Naples Housing Market to Turn Corner Next Year, Says Economist
The downturn in the Southwest Florida real estate market should reverse itself by next year, a national economist told Naples area Realtors and brokers.
“The recovery will not be a robust recovery … but nonetheless it will be an improvement,” said Lawrence Yun, senior economist and vice president of research at the National Association of Realtors.
“What people experienced back during the (real estate) boom was a once-in-a-lifetime situation,” he added.
Yun expects that by early 2008, the decline in the local real estate market will reverse, however, not to the peak levels that had the Naples housing market aflutter in recent years.
He said the impact on the local real estate market was due to a lack of confidence, not necessarily lack of financial wherewithal.
However, that doesn’t mean recovery will be quick, or that the effects have been any less severe.
Some local Florida mortgage brokers blame the media for the perception that the market is bad, which in turn hurts foreign investment, as many buyers abroad base real estate choices on media input.
Others attributed the market downturn to the overzealous Florida mortgage firms and the bottoming-out of subprime lending.
More stringent U.S. visa restrictions have also affected the number of foreigners investing in Naples real estate, some say.
Brenda Talbert, V.P. of the Collier County Building Industry Association, said the adjustment in the real estate industry “seems to be landing where the normal market would be.”
This may be a tough pill to swallow for those in construction. According to Talbert, middle management in the industry in particular has taken a hard hit during the real estate downturn.
“There’ve been a lot of layoffs,” said Talbert. “Workers with transferable skills have been able to go into commercial construction and remodeling, it’s middle management that is taking it on the chin.”
According to local Florida real estate broker Birgit Wolf, “it was a good time to bring (Yun) in and give Realtors a bit more confidence.”
Other Realtors said that Southwest Florida mortgage applicants and investors are the ones who need the reassurance, not their real estate agents.
“Everybody is sort of not knowing what is going to happen next and how far we’re going to have to wait until the market turns,” said Hilda Díaz-Perera.
“I think we have the subprime [bad credit mortgage] rate that really killed us, because investors don’t have any confidence at all.”
For Díaz-Perera the key is “to clean up the Florida mortgage business … so that the people are offered products that are good, not porous.”
SOURCE: Naples News
