Rising Prices Mark The Bottom of The Market

Even in Florida, one of the most debilitating forms of human emotion is apathy.  Meaning when people suffer from the “I don’t care” attitude, their willingness to make a decision simply freezes.  I’ve noticed a certain apathy myself when I look at my lawn—but my wife has a pretty good antidote for that syndrome.  Too bad her “big stick” method of getting me over that malaise can’t be applied to real estate buyers. 

So how apathetic are real estate buyers?  Oddly the true investors are still sitting on their hands, while the everyday run-of-the mill retirees and local residents are back.  They are looking and they are buying.

Southwest Florida’s Gulf Coast has long been a magnet for retirees looking to buy a piece of paradise.  Before the housing crash, they couldn’t buy fast enough in Sarasota and Charlotte Counties.  But as home values kept falling (and falling), retirees or those thinking about it became afraid and pulled back.

For the last couple of years, buyers were very apprehensive prices were going to continue to drop more, and even after showing a potential buyer a dozen homes, I found them saying to me, ‘Perhaps I should wait until next year.’

Well, next year is here.  Only the professional investors (and by that I mean gold and silver investors from New York) disagree with me.  They ask me if prices going to drop more, and I say—probably not.  And then they laugh and say—we’ll see, we’ll see. Apathetic? Yes--even pathethic--but we will see.

But in spite of their pessimistic views, the number of pending sales in the retiree belt from Bradenton to Punta Gorda recently soared over 56%.

Apparently buyers feel the bottom has come—and that’s a good sign.  Especially since home values in Sarasota and Charlotte counties have sunk more than 50% from their peak.  It’s fair to say prices are still falling in some areas, but the velocity of the decline is leveling off.

If you’ve been a regular reader of this column, you know I am pretty optimistic—in general.  I have called the “bottom” of the market to have been almost a year ago.  And I am satisfied that I was maybe 5% off, but if you were shopping then, you had a huge inventory to pick from—today, not so much.

Now many buyers are more fearful of not getting in soon enough, before prices rise, observers say.  Rising prices are a sure marker that the bottom has been passed—and so have the bargains.

Prices in Florida today are so much more affordable than they were a few years ago.  Seven of the 10 top metro areas where demand is strongest among online house hunters are in Florida, says a recent survey from Trulia.

The top three metro areas on the list, all in Florida, are Palm Bay-Melbourne-Titusville on the Atlantic Coast, Lakeland-Winter Haven in Central Florida and North Port-Bradenton-Sarasota on the Southwest Gulf Coast.

Dane Hahn is an Englewood based  real estate professional, you can reach him at dane.hahn@gmail.com or by phone at 941-681-0312.  See him on the web at http://www.danesellsflorida.com/.