Lee County Housing Market: A Silver Lining

As difficult as it may be to see, there is a silver lining to the Lee County housing market. First, the facts:

• Residential inventory is still near its all time high.
• Residential sales are roughly equal to the sales rate of 1999.
• Prices are down, down and down from the high of 2005
• Foreclosure filings are up, up and up – by some counts, at six times that of 2006
• The property insurance and property tax crises remain unresolved at the time of this writing.
• The residential downturn is having the expected effect on commercial real estate.
• The number of Florida mortgage borrowers moving into Lee County is down by as much as 30 percent.

So, where’s the silver lining?

With residential inventory still too high relative to the number of buyers, prices will continue to decline. That’s the Law of Supply and Demand at work. However, as prices adjust, local teachers, firefighters, police officers and service workers may actually be able to realize the American Dream of home ownership. As little as two years ago this was thought to be an impossibility.

Additionally, if prices return to below the national average, where the Florida real estate market has historically been, it will help encourage both retirees and young families to move and stay here, rather than to the state’s new competition: Tennessee and North Carolina.

Developers, who rapidly built and successfully sold developments with narrow strips of land for homesites, barracks type condos and generally poor design, will be forced to compete in the market again, offering larger lots, varied elevations, more green areas and innovative overall community designs.

The real estate slowdown is also giving residents time to reflect on what they want Lee County to become. One suggestion by Commissioner Frank Mann would control new development in an effort to preserve the natural beauty most moved here to enjoy.

When it comes to Lee County foreclosures: While it’s very sad when someone can no longer afford their home, on close examination many of the properties going into foreclosure were bought by Donald Trump “wannabes” who are now getting the education of a lifetime. Florida mortgage lenders will foreclose on some and may even have to resell them at a loss. However, new owners will get a place to call home, not at some investor driven inflated price, but at one that reflects the real incomes in Lee County.

The insurance and property tax crises threatens the long-term prosperity — some say survival — of Florida’s entire economy. Because of this, property taxes will be lowered and some type of affordable insurance will return, perhaps with a national catastrophe fund.

SOURCE: The News-Press