Southwest Florida Housing Market Faces Uncertain Future
A trio of reports on Tuesday showed that the future of the Southwest Florida housing market remains murky even among signs that it is outperforming most of the Sunshine State.
Foreclosures continued to rise in most of the region during April - by as much as 54 percent in Sarasota County.
At the same time, though, Sarasota-Bradenton remained the only bright spot in an otherwise dismal sales environment for Florida. During the first three months of 2007, the area posted a 6 percent rise in sales compared with the year-ago period, the state’s only market in positive territory.
Its median sales price, however, dropped 12 percent to $290,500. That was the state’s biggest percentage decline aside from Charlotte County-North Port, which saw a 13 percent drop to $197,300. Sales there declined 16 percent.
But Florida real estate agents took the first-quarter results in Sarasota-Bradenton as a sign that the worst of the correction might be over, while also acknowledging the market is on the verge of the slowest time of year for real estate sales.
“These numbers indicate our local market is definitely on the upswing,” said Joe Hembree, president of the Sarasota Association of Realtors. “Hopefully, this four-month positive trend will continue as we head into the summer, which traditionally is our slower season. With the current buyer’s market, an attractive inventory, low interest rates and stabilizing prices, we should continue to have a positive market.”
“Sellers have gotten realistic in pricing, and there are lots and lots of buyers in this marketplace with money,” said Michael Saunders, head of the Sarasota real estate brokerage that bears her name. “When a market picks up, the most desirable places, like Sarasota, pick up the quickest.”
Overall, sales in the Sunshine State were down 26 percent in the first quarter when compared with the year-ago period while the median price dropped 3 percent to $237,000 in the hope that Florida mortgage demand will pick up as prices come down.
Hembree’s national counterparts took a similar view to his after reporting Tuesday that the pace of existing home sales slowed in the first quarter by about 7 percent when compared with a year ago. The National Association of Realtors said home sales reached a 6.4 million annual rate compared to 6.9 million in the same quarter of 2006.
The NAR also noted that existing home sales rose at a 2.4 percent higher annual rate than in the final quarter of 2006. Fourteen states and the District of Columbia showed an increase in the rate of home sales last quarter compared with only six states showing gains a quarter earlier.
Home prices also were falling. The national median existing single-family home price in the first quarter was $212,300, down 1.8 percent from a year ago.
At least part of the decline in the median prices of homes is because sales have shifted away from more expensive homes, the NAR said.
“It appears the worst of the price correction is behind us,” said Pat Combs, the National Association of Realtors’ president, in a prepared statement.
That report came on the same day that RealtyTrac Inc., an industry research firm, said Florida home mortgage lenders foreclosed on 62 percent more U.S. homes in April than a year ago.
“We expect foreclosure activity to at least stay above last year’s levels for the remainder of 2007, fueled by a combustible mix of risky loans taken out in the last few years - many in the subprime market - and slowing home price appreciation,” said James Saccacio, chief executive officer of Irvine, Calif.-based RealtyTrac.
