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Florida Real Estate Trends: Moving Beyond The Housing Market Bust |
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Sunday, 13 April 2008 |
Recent housing industry market studies have yielded a more positive view of the appreciation rate decline, which is revealing evidence that real estate in Florida will be affordable once again, and is setting up for a correction after the mortgage bust.
As almost all the elements of a healthy real estate market are already set in place—an increasing job market, the influx of both domestic and overseas migrants, and high fertility rates, declining mortgage interest rates, and a scarcity of undeveloped land—these factors will help to make the real estate industry here a robust and thriving one again.
What Happened To The Housing Market Previously
As seen in the previous years, real estate prices in this state have been reaching record highs, which created a market wherein investors and individual home buyers could buy low and sell high almost overnight. However, these days, as supply has finally surpassed demand, home values and prices are falling and investor interest is dwindling.
In June, 2006 for instance, home sales were down 30% in all of Florida, while condo sales decreased 35%. In Naples, Florida for example, which was the area that had the highest real estate prices in the country with the average single-family house priced at over $450,000—home sales dropped a shocking 48%, while prices also dipped by 8%.
New luxury condo complexes had been sprouting all over the state, however condo sales slid by 31% in both Miami and Ft. Lauderdale, while the condo markets in Tampa were hit with a much gloomier 47% drop. Major urban centers such as Orlando, Miami, Tampa, and Ft. Lauderdale are becoming overcrowded and unaffordable to most prospective home buyers, therefore investor interest has begun to shift to less-developed areas in the state that have not fallen prey to speculators, unrealistic prices and very dense population levels.
These days, mainly residential areas like Hernando County are gaining headway by boasting reasonable prices that have adequate room for appreciation, and unlike before where investing in a declining market was considered very risky, investing in preconstruction offerings is seen to provide a safety cushion against such hazards.
Dropping Home Prices Mean More Choices For Buyers
These days, with home prices dropping considerably, most residents here can now be able to get a higher-quality residential property for reasonable prices and the lower rates as well, and will allow more people to take advantage of the abundance of jobs in areas that they would not have been able to afford a few months ago.
Florida has high potential for lucrative long-term investment, as the state’s growth will propel a gradual home value appreciation movement, without displacing residents who have more modest incomes. A lot of industry professionals and analysts see the current softening as a positive indicator, which serves as a nice way of ridding the market of incompetent home developers, speculators and flippers who were the major factors for driving home prices to totally unaffordable levels.
A steadily climbing job market and an influx of new residents is being viewed as contributing factors to the state’s quick recovery from the housing mess. Even as many so-called doomsayers and “experts” panic over the long-term effects of the real estate bust, others are looking to the depreciation as a positive indicator, as most residents do welcome the lowering of home prices, as previously, many prospective home buyers were left out in the cold due to soaring property prices which led to truly unaffordable levels for most.
Vanessa Arellano Doctor
http://commercial-realestate-florida.xon.us
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Ohio Real Estate 