While there are nearly 1,000 unoccupied new homes in Indian River County, and Florida home mortgage loan activity has slowed markedly, move-ins are happening at a record-breaking pace.

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The following bad news for owners/sellers is great news for buyers/Florida mortgage seekers:

A glut of vacant homes suggests that the national and local housing market has not yet stabilized and may be poised for another downturn, Merrill Lynch said in a research note released this week.

“Now that oil prices and [Florida mortgage rates] have stopped falling, we will be back lamenting the downturn in the housing market and its spreading effects on the economy in the second quarter, much as we were in the summer and fall 2006,” Merrill Lynch economist David Rosenberg wrote.

“Looking at the inventory backlog and still-stretched affordability levels, this story is far from over.”

The Federal Reserve’s policy-setting Federal Open Market Committee cited “tentative signs of stabilization” in the housing market last week when it voted unanimously to keep interest rates on hold.

Pending home sales jumped a stronger-than-expected 4.9 percent in December, the biggest gain since March 2004, supporting ideas that the worst was over and the housing slowdown would not tank the broader economy.

But Rosenberg called the home sales data “more of a weather report than any serious commentary on the real estate market,” pointing to unseasonably warm weather in December - typically a slow period for Florida home mortgage activity - that likely spurred demand.

Instead, he focused on a Commerce Department report showing the homeowner vacancy rate rose to 2.7 percent in the fourth quarter, well above the year-earlier level of 2 percent. That suggests a glut of almost 1 million homes sitting vacant, which will likely pressure selling prices for an extended period.

Goldman Sachs analyst Jan Hatzius noted that the vacancy rate had fluctuated between about 1 percent and 2 percent for the past 50 years.

“By itself, this would point to a fairly enormous supply overhang and little prospect of a bottom any time soon,” Hatzius wrote in a research note.

Why are home prices in Broward County and other areas dropping? It may have a lot to do with the glut of homes for sale in most of the country.

Such an inventory means buyers should have plenty of choices and lots of bargaining power in the spring selling season - typically the busiest time of the year.

Many builders and Florida mortgage brokers, for their part, hope the housing market will start recovering this year as buyers respond to price cuts and other sweeteners offered by increasingly nervous sellers. In some markets, agents say, buyer traffic has picked up in the last month or two.

But any recovery is likely to be gradual. Donald Tomnitz, chief executive officer of D.R. Horton Inc., a home builder, told investors this week that the market, which began slumping in 2005, may bottom out by mid-2007, but that “we don’t see any rapid improvement thereafter.”

Given all that, sellers should expect buyers to take their time and be tougher negotiators.

David Lee, who recently moved to Wenham, Mass., to take up a post as an associate professor of physics at Gordon College, has rented a home for his family and says they plan to be “quite picky and choosy” as they look for a home to buy. Dr. Lee doesn’t feel any pressure to decide quickly because he figures housing prices won’t rise in the near term and could fall further.

A quarterly survey of housing conditions in 28 major metropolitan areas by The Wall Street Journal showed that the inventory of unsold homes at the end of 2006 was up substantially in nearly all of the markets from the already plentiful level of a year earlier. The biggest increases were in the metro areas of:

- Miami-Fort Lauderdale
- Orlando
- Tampa
- Jacksonville
- Phoenix

The survey also includes recent pricing trends - nearly all negative - based on surveys of real estate agents by Banc of America Securities in New York, a unit of Bank of America Corp., as well as data on late Florida mortgage loan payments and job-creation prospects from Moody’s Economy.com, a research firm in West Chester, Pa.

In Miami-Dade, the number of existing condos on the market is enough to last 27 months at the current sales rate, says Jack McCabe, a real estate consultant in Deerfield Beach, Fla. The oversupply will grow, he says, as about 8,000 condos are expected to be completed this year and 12,000 in 2008.

“It’s going to get bloody down here,” Mr. McCabe says.

He estimates that Florida condo prices in Miami-Dade fell between 8% and 10% last year and will drop 20% in 2007. Eventually, he predicts, hedge funds and other investors will step in to buy surplus condos in bulk at huge discounts.

In mid-2005, the Phoenix real estate market was experiencing what local brokers call a feeding frenzy.

With the creation of thousands of jobs by the month, a sprawling expansion of new construction, and a record number of adjustable-rate loans being taken out, homes were selling fast and selling high. The atmosphere was also ripe for investors seeking quick returns.

A year later, the city is feeling the effects of a housing hangover.

“I’ve been here 17 years, and I don’t think I’ve ever seen the inventory levels as high as today,” says Robert Rucker of the Arizona Regional Multiple Listing Service.

Phoenix’s housing inventory has, in fact, nearly quadrupled over a 12-month period, from 11,656 in July, 2005, to 42,449 homes last July, according to data provided by ZipRealty.“All these homes bought by investors to try and get a quick return are having to be sold because of the interest rates and the leverage they put into them. [Phoenix] is having to go through some market correction to get that right,” says Pat Lashinsky of ZipRealty.

Slowing home sales in the Florida housing market are also yielding record-high housing inventories. Encouraging the local economy, advising sellers to be competitive in their pricing, and offering incentives to new buyers are some of the remedies brokers and Realtor associations are prescribing.

The factors contributing to a national slowdown in home sales — rising Florida mortgage costs, energy prices, soaring insurance premiums and property taxes — show no sign of letting up in the area. After five consecutive years of double-digit gains, home prices in Miami have driven buyers out of the area by the droves, creating a ballooning effect on inventory.

“Not only has the inventory increased threefold, but the amount of buyers on the market is less than half of what it was last year,” notes Ron Fillion of Ocean International Realty in Miami, who believes the city will retain a high inventory in proportion to its population for at least the next two years.

Whereas meteoric growth was once a given, strategies to maintain stability are already being proposed. In Las Vegas, where the population is set to grow by about 5,000-7,000 residents a month, according to the Greater Las Vegas Association of Realtors (GLVAR), a vibrant economy has already helped stabilize the elevated inventory.

Linda Rheinberger, GLVAR’s president, has advocated several strategies to sellers that could help bring the market back to equilibrium.

“We’re encouraging sellers who aren’t motivated to sell to delist and place a tenant in their property. Prices are always going to be the main consideration in any market,” she said.

For those who are determined to sell, Rheinberger advises them to move out and bring in the lifestyle-fabrication expertise of professional staging firms.

But the most effective selling catalyst, in Rheinberger’s mind, is always the simplest:

At the other end of the spectrum, Boston is already backing down from its peak inventory level of 45,815, recorded in June of this year. Last month, 46 percent of the homes for sale in Boston were reduced — an aggressive selling trend that will likely begin to show its face in more and more in the U.S. national housing market as a whole, even as home loan rates recede.

Nationwide, home sales may have risen in May, but there’s no surer sign of a weaker housing market than this: Properties are remaining on the market, unsold, for longer than any period of time in the last few years.

While the National Association of Realtors doesn’t maintain national time-on-market figures for this issue, inventory has climbed 37 percent for the 12 months through April 30, the most recent data available. Where are all the Florida home loan buyers?

They’re waiting for prices to come down, something that’s at least beginning to occur in the South Florida housing market. Nevertheless, unofficial regional numbers show that homes in Miami are now on the market for 35 days, a jump over the previous estimate of 20 days.

All this supply means homes are sitting around longer and sellers are asking more than buyers are willing to pay - an indication that prices may have to come down in order for individuals to agree upon any Florida home loans.

“Sellers are in denial, and there is a rising disconnect with the buyers,” said Jonathan Miller, a real estate appraiser in New York. “Until sellers get the message, you’ll see a drop in the number of transactions.”

Comparing housing markets

In once superheated markets, such as Florida, things have gotten tougher.

In Hanover, New Hampshire, broker Ned Redpath reports a “drastic” increase in time-on-market. All through the 2000s, New Hampshire averaged double-digit price appreciation and about 60 to 70 days on market. Now Redpath estimates average time-on-market at 125 days. He expects price changes to soon reflect that.

Meanwhile, in Miami, the time-on-market has lengthened to between 30 and 40 days from about 20 just a few weeks ago, according to Mario Tome, of Greater Miami Realty. Sales have been falling in the are as those seeking a Florida home loan wait for sellers to face reality.

As Broward County focuses on affordable housing, it looks as though the area is starting to make a conscious effort to shift toward those on the lookout for a reasonable Florida home loan. It’s about time.

After all, the number of single-family homes and condominium-townhouses on the market in Broward County in April surged - prices also continued to rise. No wonder fewer houses were being bought up.

The Realtor Association of Greater Fort Lauderdale (RAGFL) said 8,838 single-family homes were available in April, more than triple the 2,327 homes on the market for the same month the year before.

The median sales price for single-family homes was, at $354,300, up 4 percent from $340,000 in April 2005.; he median sale price for condo-townhouses in April was $210,000, up 18 percent from $178,000 the same month the year before.

RAGFL President Dori Longhini said the market is changing in favor of buyers. In other words, it’s the right time to seek out a Florida home mortgage loan.

Single-family home sales were at 746 in April, down 1,093 homes for the same month the year before, while April also saw 923 condo-townhouses sold, down 30 percent from 1,321 units for the same month the year before. The Broward housing market needs to focus on ways it can attract more owners.

If you want to buy a house in Nassau County, N.Y. (the west end of Long Island, outside New York City), you have plenty to choose from these days. The number of homes on the market in the region rose by more than half — 58 percent — from the end of 2004 to the end of 2005, according to Friday’s edition of Newsday.

The likely explanation for this significant sign of Long Island’s real estate cooldown is, like many other markets across the U.S., homeowners trying to sell their homes at prices they would have gotten in a boom. While there has been (and will most likely not be) a catastrophic bursting of the real estate bubble, the boom has ended and buyers aren’t paying what they would have even six months ago.

The latest data from the Long Island Multiple Listing Service, released Friday, shows 14,679 residential listings in the last month, compared with 9,423 in December 2004. The trend is reaching into the Island boroughs of New York City as well. In Queens, 6,522 properties were listed as of Friday, compared with 3,975 a year ago.

“It’s a glut of housing right now, and if interest rates go up, the glut will continue” said Martin Cantor, chief economist of Sustainable Long Island, a local economic advocacy group.

Prices across the area continued their upward march, however. It is a pattern that is happening in the nation’s hottest markets — Arizona, California, Florida real estate and more — despite the increase in inventory and seeingly more opportunities for first-time buyers to tip the scales in their favor. Prices rose by 10.3 percent over the year in Nassau County, to a median price of $482,000. In Suffolk County, on the eastern end of the island, they rose 10.5 percent to a median price of $400,000.

“I think you’re seeing the turn of the housing market, and I think you’ll see much more of the turn by spring,” said Pearl Kamer, the chief economist of the Long Island Association, one of the region’s largest business groups.

The biggest evidence is the inventory. Queens had 64.1 percent more homes on the market last month than in December 2004, at which time the residential inventory had fallen by 5 percent compared with December 2003. Another important point is underscored by these figures — the fact that the jump in number of homes for sale represents an increase from incredibly low levels.

“You’re comparing it to a time when there was no inventory. We were at an all-time low,” said Dorothy Herman, president and CEO of Prudential Douglas Elliman.

The increase in available homes means significant changes ahead for the New York real estate market, as sellers will soon have to price their homes more competitively. When that happens, gradually, buyers may be able to wield considerably more leverage. That tide has yet to turn completely, as prices continue to rise at a modest pace. Right now, in fact, may be a Goldilocks housing market of sorts. In other words, just right.

“At the moment, it’s a good market for buyers, it’s a good market for sellers,” said Christopher Armstrong, the president of the Multiple Listing Service and broker-owner of Century 21 Princeton Properties, which has offices in Holbrook, Bayport and Ronkonkoma.

Analysts concur that if mortgage rates stay where they are, the housing market will continue to surge forward. However, economists have predicted, based on the Federal Reserve’s recent history of raising prime interest rates, that mortgages (currently at 6.25 percent or lower across most of the country) could rise near or above 7 percent in the next 12 months. If that happens, the story could change again and even result in price declines.

Right now, it’s a lot of hypotheticals. Whether you are in the market for a Florida home loan or a mortgage in any other state, or looking to sell your property, stay on top of the ever-shifting trends and be sure your home is worth the price tag.

Sales of existing homes fell in November by 1.7 percent as inventories hit their highest point in more than 19 years, according to USA Today. This latest sign that housing market growth is tapering off was released Thursday by the industry’s largest trade group. The National Association of Realtors report that November’s sales of existing homes (which include single-family homes, town homes and condominiums), totaled 6.97 million units at a seasonally adjusted rate - the lowest sales level since March.

As sales fell below 7 million for the first time in eight months, inventories (or number of listed properties for sale) jumped to 2.90 million, marking the biggest supply since April 1986, when the U.S. housing inventory was estiamted at 3.04 million units. At the current rate of sales, the November inventory is the approximate equivalent of 5 months. The 1.7 percent decline was slightly steeper than the 1.3 percent drop analysts predicted before the report was released.

None of this has cooled prices, however. The November median sales price of an existing home stood at $215,000 nationally, up a sizable 13.2 percent from the same month last year. Some markets, such as Southwest Florida real estate, grew by more than 40 percent in the last year. The median price in Florida is now $250,500, up 31 percent from 12 months prior. Even with the drop in sales, economists are predicting a healthy housing market going forward, with the overall 2005 sales on pace to set a 5th consecutive annual record.

“We are really on track for a soft landing,” said David Lereah, the Realtors’ chief economist. “Moderately rising mortgage rates are allowing the housing market thus far to land safely, so there are no balloons popping,” he said.

Other common barometers — including a drop in new construction permits obtained in November — also have flashed signs that the market has peaked. That may be, but it’s no reason to panic if you’re looking to invest over the course of several years. Florida home loan rates are not expected to climb about 6.75 in the next 12 months, which would still represent a historically low figure. Prices should cool off enough to help first-time home buyers, but not so much as to hurt the long-range viability of investing in real estate.