Island home prices rise sharply; buyers coming back into market
STORY BY STEVEN M. THOMAS, (Week of April 19, 2012)
The median price of a barrier island home is up 15.7 percent over last year and people appear to be jumping back into the market.
“There is definitely an upward trend,” says Dale Sorensen Realtor Grier McFarland of home prices on the barrier island. “People are letting go of their money, which they have been afraid to do up until now.
“There are more buyers in town this year than there were last year at this time. I have run into a couple of situations where I have gotten multiple offers on a property, which is always a good sign.”
McFarland’s assessment is backed up by the popular real estate website Trulia.com. It shows the median price for a home sold in the 32963 ZIP Code area between December and February was up 15.7 percent compared to the same period a year earlier.
According to the site, the median price increased from $350,000 to $405,000, a substantial bump. The average per-square-foot price jumped 14.2 percent to $242.
Nationwide, housing prices are still trending slightly downward according to the latest S&P/Case Schiller 20-city home price report, which shows a 3.8 percent annual decline.
The continuing swoon, which has slowed dramatically since the darkest days of the crash, is driven by the much commented on “glut of foreclosures” and overly restrictive bank lending standards.
But markets in some highly desirable coastal locations seem to be bucking the trend.
Miami was one of only three cities to show a price gain in the Case Schiller report that came out in late March and values are up in the sunshine state as a whole.
“Growing optimism about the economy, gains in the state’s jobs market and continued low mortgage rates are generating interest in Florida real estate,” says Florida Realtors President Summer Greene, regional manager of Better Homes and Gardens Real Estate in Fort Lauderdale.
“Increased statewide pending sales for both single-family existing homes, up 36.1 percent, and for townhouse-condo properties, up 19.8 percent, show that buyers are encouraged by these positive signs.”
The statewide median sales price for single-family existing homes in February was $134,000, up 7.2 percent from the year-ago figure, according to Florida Realtors. The statewide median for townhome-condo properties was $95,000, up 15.9 percent over February 2011.
“It is no longer 100 percent a buyers’ market,” says Matilde Sorensen, Dale Sorensen Real Estate broker and co-owner. “It is not 100 percent a sellers’ market either. The market is coming back into balance.”
Real estate professionals generally agree a six-month supply of houses indicates a balanced market. In February, there was a 6.2-month supply of single-family homes for sale statewide, and a 6.3-month supply of condos/townhomes, according to Florida Realtors.
“The overall picture that these statistics show is of a stabilizing housing market,” says Florida Realtors Chief Economist John Tuccillo. “These are signs of a market that’s moving from being a buyer’s market to a balanced market.”
On the island, shrinking inventory and increased demand are clearly boosting prices and creating a cautious sense of optimism among real estate professionals.
“I was talking to some buyers last weekend who asked me how low their offer should be for a property they are interested in,” says McFarland. “I told them they should offer the asking price because a lot of people are interested in the property. If they don’t buy it now, it will be gone.”
“There is finally a sense of urgency in purchasing,” says Moorings Realty Sales Co. Broker Marsha Sherry. “Buyers who wait too long now are finding the property is already gone, or under contract, when they go to put in an offer.”
“Are we entering another bull market?” says Alex MacWilliam Inc. owner Buzz MacWilliam. “Maybe.
“But we won’t know for sure until six months in the future when we can look back and see what happened.”
“We are extremely busy,” says Matilde Sorensen. “We are going into a different category of market.”
“Our economy went down first in the whole state, so we are going to come back first,” says Billero & Billero Properties broker and co-founder Gene Billero. “We have the best deals and best values in Florida.”
“Prices have definitely stabilized and are starting to come up a bit,” says McFarland.
“By next season I think we will be off to the races,” she added.