Economists Say that Housing has finally Hit Bottom

 The great housing depression of 2006 to 2010 seemed like it would never end. It began in September of 2006 and relentlessly tumbled year after year without an end in sight. However, now for the first time experts are starting to see the signs that we have finally hit bottom and they are optimistic that recovery will begin quickly.


Christopher Thornberg, founder and principal of Beacon Economics says that a high level of affordability is likely to drive demand up and reduce the stock of excess inventory, which will ultimately result in the need for new housing, a rise in home prices and a resumption of new construction.

Jordan G. Levine, manager of Beacon Economics Research says, "While prices may fluctuate modestly over the next several months, we believe the worst of the housing crisis is behind us. We expect prices to stabilize around current levels and likely be higher in the next 12 months."

This news is welcomed by the downtrodden, underwater homeowners who have been searching for any sign of relief after watching their property values perpetually free fall since the crisis began.

On the brighter side of this downturn, those who are lucky enough to be potential buyers are waking up to find the rain has stopped and housing bargains have fallen from the heavens all around. The housing market in many parts of Florida is sitting at an astounding 50% below construction cost.

“I can’t say if the market is really at the bottom or not,” says Ed Cooper of Port St. Lucie, “but it’s so close that I don’t think it even matters anymore. I don’t know how people can go wrong when they’re buying a 2,100-square-foot home that’s 3 years old, for $50 a square foot.”

Anyone hoping to cash in on a deal had better start now, because to add a spark to a match, October’s 30 year mortgage rates have hit a light-headed 3.875%, an all time record low in the history of Freddie Mac. For this reason most industry insiders are one by one coming to the realization that with the fantastically low housing prices coupled with miniscule mortgage interest rates the conditions are ideal for the entire housing industry to explode like a powder keg.

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re-blogged from our main Naples Real Estate Blog
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Naples Home Market Statistics, 2nd Quarter 2010- Price Increase.

Prices for homes in Naples HAVE been going up as evidence by this median sales price market report. The median sale price for homes in Naples for the last quarter has been $192,500. This is a 6.4% increase or $11,500 compared to the first quarter of 2010 and a 10% increase compared to 2009.

 Is this an indicator of the Naples home market rebounding or are we going to see a second decrease in home prices?

It is anyone's guess! However I personally believe that Naples, being a world class destination, will not see any further softening. Sales prices for homes in Naples have depreciated 43.3% over the last 5 years, which is virtually half of what they were in just 2005.

Families and indivuduals with money have always been attracted to Naples with its pristine beaches, world class shopping and dinning and upscale entertainment and residences and that will continue keeping the home prices in Naples relatively stable. As evidenced by the fact that the most popular neighborhoods in Naples in 2010 have been Park Shore, Old Naples, Moorings, Royal Harbor, Port Royal, and Coquina Sands,
luxury home communities, mainly on the water or with bundled golf.





The home buying frenzy in Naples slightly cooled down by the end of the summer as expected, which for a prospective buyer would mean less competition at still low prices. If in the past we have seen multiple bids on most Naples listings on the market with buyers fighting over Naples homes, now only the lowest priced listings in Naples get the same attention, while others sit on the market for slightly longer.




Average price per square foot in Naples has been steadily increasing over the last year, going from $137/sq.f last August to $244/sq.f in August 2010





For more information contact Andrew and Elena Ollick:
Andrew and Elena Ollick

Amerivest Realty

PHONE: 239-206-4500

TOLL FREE: 800-801-6080

FAX: 888-264-1080

EMAIL: eo@oceanhomesrealty.com

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re-blogged from www.AndrewOllick.com/realestateblog

SW Florida Homes http://www.andrewollick.com/

SW Florida Luxury Homes http://www.oceanhomesrealty.com/

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Buyer's Market vs Investor's Market

The Mass Media and Naples realtors have been screaming about Naples, as well as Florida as a whole, being a buyer's market.

THE ADS SAY:"NOW IS THE TIME TO BUY!"

And who can argue? Home prices in Naples have gone down more than 50% off construction cost.

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The problem for ordinary Naples home buyers becomes the fact that Naples investors came out of their hiding places with all their stashed cash to pounce of foreclosures. That might seem like a good thing for the market, however, cash wielding investors negotiate much lower prices to due the immidiate nature of the purchase, thus lowering the prices further. To add to the problem, eager investors take over bids that would normally go to good Naples homebuyers, who would finance the property and use it as as a primary residence.

If anyone has ever worked with a Naples real estate agent and tried to put in a bid on a reasonably priced Naples property, they would have discovered that it take 3-4 offers to get one accepted by the bank. Banks want NOW and they want CASH. They will take a lower bid in cash over a higher one with financing contingency. That makes some cash investors quite unrealistic.
I've had people call me with the following words:
"I have cash and I'd like to offer "here goes an offer that is 50% less than asking price" on a property located 123 Main Street, Naples FL".

Some first time primary residence home buyers have gotten the impression that cash will do miracles. However they are wrong- cash only goes so far. That's why it's pretty important to have an experienced Naples agent who has worked on Naples foreclosures and Naples short sales, negotiated a few of those and knows where the breaking point for a one or another seller would be . Also this changing market requires us, Naples realtors, to adjust accordingly and FAST. How many realtors have met who still don't know how to use internet well, who fumble with Facebook, sign everything in person, have only paper copies of documents?

Getting back to the Naples investors issue, the problem is they don't let normal hard working buyers get a chance at buying a good property. They win. Every time. You work with a client, you put in 2,3,4 bids in and NOTHING. Then the homebuyer finally agrees to start bidding higher than the asking price, like you've been trying to coach him/her. And that's how you get a contract accepted. A Calculated risk of paying higher price over actually getting the house.

I see several scenarios that will happen after the investors have bought up all the possibly Naples inventory.

They start selling it! At a higher price! Market value starts going up: good for the Naples market and Naples homeowners , bad for the average Naples homebuyer.

Or we see another inventory rise, which coupled with a new foreclosure wave will lower the Naples prices to where we have them now.

Either way,
what an average Naples homebuyer should get out of is this:
Buy and buy now! It WILL be hard to actually get a contract on a good Naples home, unless you're willing to be over the asking price. However, it's well worth.
It's like the stock market and the Naples Homes stock has been upgrade to "BUY".

What a Naples investor should get out of this:
Get your money out and cash in on the greatest feeding frenzy there has been in a long time.

What's come down is bound to come back up!
So arm yourself with a good Naples realtor, and start shooting!

FYI: Naples Home StatisticsNumber of Naples homes bought in cash: 5,135Number of Naples homes financed with 20% down: 2,125