Thursday, October 26, 2006

Buyers Calling the Shots...

Flashback to 2005. Sellers would receive multiple offers, at full price. Flippers were everywhere. Prices went up 2-3 % a month.

Fast forward to 2006. Like a marriage gone bad, homeowners are trapped in their houses, unable to sell, unable to move, and some are unable to continue to make the payments.

As reported in today's Palm Beach Post , the markets have turned from a seller's dream to a sellers nightmare. The scary thing, is that we have a long way to go until prices return to the mean. The nightmare will continue for some time. Prices in Palm Beach county dropped 9 percent year over year. Notice the key points of this article, all of which have been mentioned since this blog started. As usual, the MSM is reporting the obvious.


"Palm Beach County and the Treasure Coast, once among the hottest real estate markets in the nation, are no longer the booming sellers' markets they were between 2000 and 2005. "

"Now, buyers are calling the shots. "

"The slowdown has caused an astounding 49-month supply of existing homes for sale in Palm Beach County, Regional Multiple Listing Service records show. Last month, Palm Beach County and the Treasure Coast led the state in declining home sales and tied for the third-largest rate of falling home prices. "

"The buyers who are out there now are very aggressively looking for tremendous price cuts," said Klein's agent, Barbara Siegel of Lang Realty.

"Before the slowdown, homes in this community were selling in 24 hours," Siegel said. "There were bidding wars."

"In most neighborhoods where we sell property, the average sales price has dropped more than 20 percent this year," said Thomas Moffett, broker/owner of Century 21 Sunland Realty, whose office sells property in central Palm Beach County. "

"In Martin and St. Lucie counties, the median price of an existing home also dropped significantly, to $244,300 from $269,400 in September 2005. It was the fourth straight month of falling home prices and the biggest percentage drop so far. "

"Until last month, when the median price of an existing home in Palm Beach County fell 6 percent, the last time comparable prices fell year-over-year was in February 1999, according to association archives. But the number of homes sold has been declining throughout 2006, and that trend continued in September, when existing single-family home sales fell 53 percent in Palm Beach County and 46 percent in the Treasure Coast, the two biggest declines in the state. Palm Beach County buyers closed on 566 homes last month, just over half of last year's 1,022. Treasure Coast buyers purchased 336 homes, down from 621. "

"The market turnaround has caused a tremendous increase in what the industry calls "inventory," unsold homes on the market. The regional MLS shows 27,611 homes for sale this month, more than double October 2005's inventory of 11,605. "

"Nevertheless, affordability remains a critical issue in Palm Beach County, where 90 percent of the workers can't afford the median-priced home, recent studies show. "

"Foreclosures also loom large as falling home prices prevent financially troubled homeowners from selling to get out from under exotic mortgages with escalating payments they no longer can afford. "
Statewide, the median price of an existing single-family home fell 1 percent last month, to $243,900. Sales fell 34 percent statewide as every market in Florida posted declines compared with September 2005.




7 Comments:

At 1:15 PM, Anonymous Anonymous said...

Why aren't prices coming down faster given the huge inventory buildup?

 
At 4:25 PM, Anonymous Crazy G said...

Very, Very simple answer to that question;

With the insurance situation , and the taxes to boot, people are just NOT buying into the Florida lifestyle anymore

PRICES WOULD HAVE TO DROP BY 50% OR MORE, TO ENTICE THE MULTITUDES TO TAKE ALL THIS INVENTORY!!!!

You calculate the afforablity rate, and see for yourself!!!

Go out and find a teacher, a fireman, or a policeman, that wants to buy a house, and see how much they can pay, and set the resale price at that, then you'll get the inventory moving again!!

""NOT BEFORE""

 
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At 11:23 PM, Anonymous Anonymous said...

your right there is lots of arrogance from seller and they still think in there minds that they can get 2005 price , yea right i say , I'm in south Florida right now trying to buy something and it seems to me that seller are inn denial. big daddy please give me some advice , when do you think it is a good time to buy should i wait 6 month to a year , i figured by coming here now from long island i would be able to get a good deal compared to the past years. i am working with 20% down and would be able to close asap and seller are not as negotiable as i thought they would be. a example is in a town called plantation in the prime market a town house in this development was selling for 205,000 these seller are asking 215,000 and wont come down a nickel. i told them forget it and keep dreaming i offered 185,000 witch i thought was a fair offer and it was denied they property has been on the market for about a year , are these seller nuts , the need to get there head out of there ass and realize that times have changed before there property ends up being worth only 145,000 in a few years , big daddy should i buy or should i wait to buy in broward county please email me at dalmi343@yahoo.com with you advise or if anybody else has an option for me please feel free to write me , thank you

 

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