Despite Florida Mortgage Woes, Optimism Remains in Boca Raton, State

Sales of existing homes in Florida remained at a sustainable pace in March, with buyers continuing to see favorable Florida mortgage rates and a range of housing options available in Palm Beach County and across the state.

While many agree that the party hats seen in the Florida housing market over the last five years are now back on the shelf, the market remains “vibrant,” according to one of its major local players.

“It’s interesting,” said Scott Agran, broker and owner of Lang Realty. “I feel the market is more vibrant than last year.”

Olive Belcher, a Realtor and agent with ReMax Services in Boca Raton, said she deals with high-end transactions, and the declining market has less negatively impacted that segment.

“I feel like the market is picking up,” she said.

“I had a $10.5 million listing for only a month and we’ve had three or four showings. We just got the marketing out. The high-end market, that’s what’s selling. They aren’t worried.”

And while no local Florida mortgage broker, lender or real estate agent groups are close to throwing in the towel, most were also realistic.

“I have to look at the past nine months,” said Sam Mina, broker and owner of SaMina Realty.

“The market has not been the way we would like it to be. There has been a big, big slowdown in making decisions to buy. Buyers are very, very careful - and they are educated. Yesterday, I was at an open house with about 30 brokers - and they made the same comments I did.”

Mina felt the “biggest concern” is “taxes. When people see they will have to pay 2 percent of the purchase price, they get scared.”

He said the governor and state legislature are making noises about cutting taxes, but the negativism is still spreading.

“And we don’t want it to spread.”

Lang Realty’s Agran says concern stems from the reality that many “marginal” Florida mortgage borrowers are going belly-up.

When homes were selling at a rapid pace and prices soared, many Florida mortgage providers offered subprime mortgages to marginal borrowers.

“Now, the mortgage rates are going up,” he said.

“It was all right when all properties were increasing in value. Then, if a person got in trouble, he could go out and sell,” he said. “Now, people can’t sell. And they can’t afford to stay in their homes.”

He admitted the Boca area “hasn’t had a lot of this.”

But he fears that as lenders deal with foreclosures and “the subprime market starts to fall out, banks may cut back on credit. It would make it a little more difficult to get loans. Only the best would qualify,” he said.

And while Belcher at Remax Services says the current market slowdown is among the worst she’s seen over the last 20 years, Mina at SaMina Realty offers an optimistic note:

“My feeling is that we’ve seen the worst of it. Sellers are saying, “Enough.” Just go and sell it. We are starting to see a transition.”

Agran noted that people who are trying to sell don’t want to play games. The sellers understand that they have to energize the Realtor.

If you want to play games and try to outsmart the market, he says, you will be holding on to your property for a long time, as Florida home loan demand remains tepid in spite of low rates.

He figures that “in a year to a year and a half, the market will trend back to normal.”

Mina predicted six months to a year. “Our company is doing well,” he said. “We are paying the bills, making a few dollars – and lighting a candle.”

SOURCE: Boca Raton News