Florida Home Prices Now Less Overvalued, Reports Say
Below are excerpts from Southwest Florida and Southeast Florida publications in recent months regarding home prices and the directions they are headed, as compiled by The Housing Bubble Blog …
The Sun-Sentinel: “Home builder Hovnanian Enterprises is trotting out big bargains this weekend, in Palm Beach County and other areas nationwide, to cope with the worst housing slump in 16 years.”
“Buyers can expect price reductions and other incentives worth up to $50,000 at each of the developments on Southern Boulevard, said Mark Hodges, president of Hovnanian’s South Florida division.”
“‘We’ve told our sales staff to be ready to sit down with everyone who walks in the door and find a way to get them into the home,’ he said.”
The St. Petersburg Times: “Last year, a townhouse seemed like the perfect move for Richard Wojciechowski. He bought a 1,700-square-foot Sabal Pointe home and listed it at $229,000. The retired banker thought it would be an easy sell. But 14 months later, in Hillsborough County’s slowest housing market in seven years, the place is still for sale.”
“Realtors have persuaded Wojciechowski to drop the home price to $204,900. That’s more than $15,000 lower than the median home sale price in Brandon last quarter, and it’s as low as he wants to go.”
“Hillsborough County’s noticeable price declines last quarter occurred in neighborhoods where home builders were most active during the boom.”
“Anthony Teta tried lowering the price on his 1,400-square-foot home, starting at $229,000 and went to $189,000. ‘I was coming down to a break even point,’ he said. But with nearby builders offering major incentives, Teta felt he could not compete.”
“A real estate Web site still lists his house as ‘priced to sell.’ Teta took the ‘For Sale’ sign down weeks ago. ‘I love the house. I love the neighborhood,’ he said. ‘I had to remind myself of that.’”
“Realtors say many clients cannot afford to lose those gains, because they took out Florida home equity loans, borrowing against the soaring value of the house. ‘They paid for boats, and BMWs and trips and whatever,’ said one Realtor.”
The Miami Herald: “When Micheline Louis-Charles bought her house in North Miami 20 years ago, her salary was enough to pay off her Florida mortgage and raise five kids.”
“Since then, her payment, which includes the home mortgage, plus taxes and insurance, has doubled to $1,200 a month, and her income has not kept pace. She rents out a room in her three-bedroom house to cover costs.”
“‘Everything goes toward the [Florida mortgage]. I survive in a very hard way,’ said Louis-Charles. When asked if she has thought of selling, she says, simply: ‘Where would I go?’”
“The largest discounts nationally are on the most expensive homes, including a three-bedroom condominium by the Hudson River in West New York, which has been reduced $240,000, or 22 percent, to $862,000 this weekend.”
“Keith Gumbinger, Senior V.P. of a consumer loan research firm found the sale remarkable, given low mortgage rates. ‘You wouldn’t think there is a need to go to the marketplace with such discounts. This is a pretty good indication from a prominent home builder that the market is troubled.’”
The News Press: “The Southwest Florida housing market is still overpriced — but they’re a far better buy than they were a year ago, according to a national survey released this week.”
“Homes in Lee County, now the 95th most overpriced of 330 markets in the U.S., were overvalued by 23.3 percent in the second quarter, compared to 38.8 percent a year earlier, according to Global Insight.”
“In the same time period, prices in the area fell from a median single-family home price of $298,700 to $230,000.”
“The Naples housing market was overpriced by 49.5 percent at $376,000, the 17th most overvalued market in the country. But that’s an improvement from a year earlier, when it was ranked 8th: overpriced by 65.5 percent.”
“Charlotte County, in 54th place, was over by 32.6 percent with a median home price of $193,900, improved from 56 percent over at $212,400.”
“Southwest Florida’s numbers are cause for optimism, said Jamie Pirrello of Fort Myers-based Vision Homes USA. ‘I actually felt, ‘Wow, maybe we’re finally approaching close to bottom… the amount we’re overvalued has decreased.’”
SOURCE: The Housing Bubble Blog
