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NOVEMBER 2009 MARKETWATCH NEWSLETTER
U $500k HOT HOT HOT AND A FLURRY OF $1MM RIVER & OFRONT SALES
Formerly DOA, our island’s high end market came to life over the past 60 days, with flurry of ocean front and river front sales closed over $1MM, proof that when pricing reaches current market levels, buyers do turn out ready to buy (we garnered 3 offers in 24 hrs for a riverfront client who is now happily SOLD!); Still particularly robust and getting hard to find as demand exceeds supply: barrier island under $500K – more so under $400K -- single family homes or villas that live like a single family without the high fees of similarly priced condos. That said, condo sales volume past 60 days exceeded that of single family homes, comprised primarily of prices under the $250K level though, yet that price point represents a tiny percentage of prices of inventory remaining for sale, an inverse correlation between what’s selling and what’s for sale for all property types, but for condos likely to compensate for the uptick condo dwellers face with fees now disproportionate to their market value.
With recent GDP numbers indicating what some would argue artificially produced growth officially ending our painful recession, Vero appears like the rest of our nation to be in the midst of a slow recovery. The always interesting Case-Shiller housing index again showed upticks for the second month in a row of pricing in 28/30 housing markets studied, notable as since the index’s launch 36 mos ago the past two months literally represent the first time ever growth was positive. Unclear is whether the legislated attempts to jump start the languishing middle markets of our nation’s real estate market will impact our region, as buyers making under $250K year can now qualify for a $6K income tax credit for purchasing a home that closes by April 2010. Loan Rates remain historically low with even some past premium for jumbos eliminated by many lenders wanting back into this market, affordability’s the greatest it’s been since early 2000 years, yet confidence about our tender recovery and economic future combine with a weak recent T-Bill auction to potentially raise rates. The one undeniable truth, well, two: the inevitable arrival of Old Man Winter and Boomers turning 60 through 2015 could well be keys to insure our tender recovery continues to strengthen.
August 2009 MarketWatch Newsletter
U $600K remains robust, yet most island property's over $900K...
Yet signs of life emerge in higher price points...
This August's hardly been the prototypical sleepy summer as buyers increasingly jump off their perch of indecision, making offers on a bevy of screamin' property deals. In the past 30 days more than half a dozen properties we'd been watching for months on behalf for clients - from $200K to well over $1MM - have taken contracts. While the under $600K market has been robust since last November, most sales remain under $600K, with most inventory over $900K, illustrating a genuine disconnect between what buyers are buying and what sellers are selling (a tale of two markets, as noted in a great Wall St Journal front page piece last week in which we're pleased to report we were the only FL realtor quoted!).
Still, there are signs of movement in higher price points: over just the past week there has been a discernable uptick in interest and showings of real live buyers ready, willing and able to strike in homes over $1MM with several contracts coming together and several deals quietly brokered at handsome discounts. Vero continues to mirror regional, state and national sales activity that's up markedly YOY and with every successive month this year, as we continue toward stabilization of prices. Our belief remains that the best deals to be had will be traded in the U $600K now through October and over that between now through fourth quarter 2009. The majority of off island sales continue to be REOs as buyers' disaffection for arduous short sales continues while the sheer rarity of REOs on our barrier island translates into sales brokered by owner/occupant sellers who price their homes akin to '03-'04 levels to attract a buyer ready, willing & able to write a deal. Another good sign: Jumbos showed a sign of life over the past month, as several institutions began campaigns to attract buyers needing loans over $417,000 and even shaved higher than usual rates and down payment requirements to increase their lure.
July 2009 MarketWatch Newsletter
Under $600K sing fam homes are KING; condos, $1M+ homes: not!
Holy Toledo, what a month! June was the first time in three years we've been so busy managing buyers, contracts and closings that we were unable to produce the monthly edition of our BUY rated newsletter. Translation:biz is up for single fams in the under $600K market, with buyers from across the globe pulling the trigger and entering into contracts -- some after waiting years, some after seeing a national report that cited Vero a whopping 42% undervalued when compared to 330 national markets. (A report in which yours truly was pleased to be asked to opine, as we have long been bullish on the value called Vero Beach real estate.)<br>The next time you hear somebody tell you that Vero is sleepy in the summer, remind them that gone are the days of 'seasonality' to our real estate market as smart buyers realize the best deals will trade now through the Fall as devaluation continues to transition into stablization.
So that's what's hot. What's not: condos remain very very soft as buyers reject their escalated fees. Homes over $1M of any type, but esp those without water of some sort -- even homes with dockage need to be extremely aggressively priced to attract a buyer who's ready, willing and able. Declines in our key feeder markets in the NE and midwest continue to create a major domino effect as sellers await buyers' collective sale of properties elsewhere to enpower their purchase here in Vero Beach. <b>Sales volume continues up YOY </b>as prices naturally decline, albeit in smaller increments -- to whittle down swollen nventories. Note to visionary buyers: anyone in search of a 3+ year play of any property type will have a plethora of choices. Ask us where the bones are buried! Other Buyer trends we see continuing:</b> smaller living spaces, 'less is more' and continued interest in in-town abodes that keep cars in the garage.
May 2009 MarketWatch Newsletter
Hot hot hot: sing fam under $600K E of A1A, inventory scant!
Heightened showing and sales activity continued this month, lending further credence to our contention of last month that pricing has bottomed and that our market is transitioning from devaluation into stabilization. Single family homes under $600,000 are particularly robust with scant inventory available – lending speculation about whether demand with little inventory will begin to put upward pressure on pricing.
Florida’s existing homes sales in increased in March, making it the seventh month in a row that sales activity showed YOY gains from 2008. And for a market like Vero that’s reliant upon feeder markets from the Northeast and Midwest to bring second home and relocating buyers, there’s more good news: a recent Radar Logic analysis of 25 metro areas showed that price declines in all areas were beginning to level off. That means as other regional markets improve, there’s hope for buyers elsewhere desirous of buying in Vero but unwilling until the sale of property owned elsewhere.
One of our favorite financial gurus Wilbur Ross recently came out on the record as bullish for investment in Florida real estate, opining that Florida real estate had demographics going for it, as he noted “People want to be in a warm climate where there is no State income tax or State estate tax.” Boomers turning 60 through 2015 are another undeniable global demographic trend that will pair with three years of pent up buyer demand that’s showing signs of breaking open to fuel our market return to more balanced condition between supply and demand.
Note to those of you aspiring for your dream vacation, second or retirement home: take a look at this week’s Barron's – noting that luxury properties are priced nationally at a 30% discount off their peak prices. This stat holds true in Vero as well, with some property types – notably some very tony golf course and deep water dockage gated communities heavy with inventory yet having nary a sale thus far this year, ripe for deals by opportunistic buyers ready willing and able to write a contract and close fast. Inventory of oceanfront single family homes and condos of all price points remain very soft, also offering significant acquisition opportunities.
April 2009 MarketWatch Newsletter
Opportunities Lost...As Stablization Sets In
How’s this for action: in the past three weeks 7 properties we’ve been watching for clients took contracts after long tenures on the market, all representing the best buys of their type and category for condition, locale and likely acquisition price. Translation: buyers that were watchers instead of active participants allowed other buyers to scoop up deals that had intrigued them.
Market conditions are beginning to shift into stabilization, and in some brackets downright robust -- particularly in the under $500K bracket, but seen in all price points for properties priced to reflect current market conditions ( including a flurry of oceanfront properties that have sold, all after years on the market. ) As markets often correct from the bottom up, we see the increased affordability of jumbo loans combining with the elimination of the best deals from lower price brackets to likely push buyer demand up to the under $600K price brackets and any other aggressively priced product for its type.
Dramatic upticks to buyer showings appear to be translating into offers and pending sales. A careful eye on pending sales -- a more forward looking indicator than sales closed, a rear view mirror approach –should clarify whether or not the shift is an aberration or more long term, as we believe it to be. Historically low interest rates appear to be convincing buyers previously set on a fence of indecision to seize the market – that, and a belief that values have effectively bottomed out to 2003-2004 levels. It is our believe based on macro and micro market indicators that our market is undergoing a transition into one of stabilization – meaning the best deals to be had will be traded from now through the summer months by savvy buyers who set property basements by tendering their offers to purchase.
Opportunities remain for buyers to seize the best deals still on the market, and there are plenty of them out there. It would be our pleasure to learn your wish list and create your own custom BUY-rated list of acquisition opportunities for your ideal property in paradise.
March 2009 MarketWatch Newsletter
The frenzied buyer activity of the past three months has shown a clear schism in our market: buyers have determined that the low and uber high end markets have hit their bottom, with both low end and high end - largely oceanfront - high profile properties going under contract (some after years on the market) at aggressive, (read: soft) list to sell ratios. At the other end of the spectrum, contract activity in the middle market that contains the majority of inventory has virtually evaporated, awaiting its bottom to be set by bold buyers proffering contracts. Condos and raw land remain the softest of all, with buyers taking a pass on condos largely due to escalated HOA fees, perceived to be too high to justify, acting thus like a rock pushing down condo values and land, simply because the abundant availability of new or nearly new at resale pricing makes the hassle of building difficult for most buyers to justify. Why the disparity in market segments? Hammered by continued stock market declines of the past six weeks, buyers in our market's pivotal middle market have retreated into their buyer shells, no longer sure that signs of recovery evident early in the year now ring true, as their usually elective purchases of often second or seasonal residences are put on hold for better times when the roadmap of the future appears less cloudy. Uncertainty by many brings opportunity for a bold few, however, as money's not been cheaper in a long time, and sellers, equally unsure about the future, are more motivated than ever to broker a deal with a buyer who's ready, willing and able. Be bold, buyers! Seize the market and make it yours -- we can help identify properties we'd rate BUY in top notch communities with solid records of long term appreciation offered by sellers to truly want to sell and can make a deal happen. If a property in paradise is part of your long term plan -- with no heady plans for a fast flip in a year or two -- now is the opportune time to capitalize on the market malaise to acquire your ideal property at prices you didn't think possible. We can ID a bevy of once in a lifetime opportunities that only this tsunami of circumstances could create -- we'd be delighted to help make one such opportunity yours.
February 2009 MarketWatch Newsletter
Whether a result of avoiding cold climes or seeking to scoop up bottom market deals, last month again saw a huge uptick in buyer activity along the barrier island that began around the holidays. Buyers from across the globe are looking at properties of all types and points – we've not seen this level of activity in nearly three years (apparently the statute of limitations on pent up buyer demand!) Colleagues report similar foot traffic and statewide sales were up 27% Y/Y while only up a respectable 6% nationally. Double digit sales volume for the last several months year over year appears to signal a trend that sales volume -- the vital first component to any recovery -- may finally begin to stabilize at a level that will continue to whittle away at bloated inventory levels to balance supply with demand and, gasp, may even put upward pressure on pricing by year's end! (That, and looming inflation worries...)
Sales last month saw a decline however, reflective we think of November's stock market shock waves. What's more important: looking forward -- will the activity of the past 7 weeks translate into sales? March & April sales stats should reveal whether or not buyers are finally hopping off their fence of indecision, establishing bottom market pricing with their purchase offers.
While we were deeply disappointed to see the proposed $15K homeowner tax credit and increase in conforming loan limits nixed from the final stimulus bill, we were pleased to see Vero given its props by selection for the updated travel book Great Towns and in a recent travel piece in the Toronto Star, the hometown paper of so many of our Canadian friends who've long since had an important presence here.
Remember the car trip license plate game? Here's the Vero version: buyers since Christmas with whom we've had the pleasure of touring around Vero, or will by end of March: MI, NE, WI, NJ, FL, Berlin, Frankfort, Toronto,, CT, NY, MA, TX and SC (yes SC, clients seeking to escape winters colder than expected, as Vero is the start of the tropics.)
Who says nobody's moving to FL and that only retirees come here? Check this out:
Facts gleaned from an Associated Press study of new Florida driver’s license applications submitted in 2008:
— Florida remains the top choice of New Yorkers relocating out of the Northeast, ahead of North Carolina, California, Virginia and Georgia, even though that number has dropped by almost 30 percent over five years.
— Last year, the top states from which applicants for Florida drivers licenses originated were New York (42,000), Georgia (21,000), New Jersey (20,000), Michigan (19,000) and Pennsylvania (17,500). In 2003, the top five states were New York (76,000), New Jersey (31,000), Georgia (29,000), Ohio (24,500) and Pennsylvania (24,200).
— The states that produced the fewest Florida transplants last year, as well as five years ago, were two of the least populated states: North Dakota and Wyoming.
— Considered as a group, the largest number of new applicants were foreigners last year, as in 2003. Coming from more than 200 countries, they made up almost 70,000 applicants last year and more than 83,000 applicants in 2003.
— The average age of the new applicant last year was 42, as it was in 2003, indicating that people moving to Florida skewed toward a working age population rather than retirees.
January 2009 MarketWatch Newsletter
Will Buyer activity convert to sales?
Now that shock of last Fall's stock market volatility has abated, buyers are out in force, looking with our firm
and others having dramatic increases in buyer tours of a myriad of property opportunties at all price points. Activity in the over million category remains very sluggish, as buyers ponder whether or not to preserve cash and whether real estate in Vero that appears to most to have bottom out deserves a place in their portfolios.
Jumbo may be the elephant in the living room, as confirming loans limits of $417K remain insufficient to meet the lending needs of average home purchases on our island, with buyers forced to pay 2% or more for a jumbo-- forget another bailout, how about a Fed policy decision to raise our confirming loan limits to continue our market correction?
Also aiding activity: Old man Winter, as reliable as death and taxes, who's reminding buyers mightily this year why Vero's 'where the tropics begin' climate's favored by those fortunate to call Vero home (and why we continue to work with former Vero-ites now in the Carolinas anxious to return to Vero to escape Winters far colder than expected or desired!)
Snaps to FL public schools for being ranked #10 nationally by a well regared education publication, citing accountability and choice in particular when ranked #30 just 5 years ago.
Also interesting: the annual Allied Van Lies survey that tracks FL in/out migration that last year showed a net population
loss, this year showed a net zero change from equal in/out migration.
Finally, Florida economic wunderkind Hank Fishkind's just filed a national report on real estate recovery, predicting a nationwide return to more balanced conditions in the 3rd & 4th quarters of this year, with Florida's recovery highly
dependant upon recovery of economies of the Midwest and Northesast that remain key feeder markets for us.
Call us if you'd like a PDF copy!
November's 2008 MarketWatch Newsletter
Like Winter, buyers inevitable return....
Since last month's lack of activity, Wall Street's volatility has brought buyers back to Vero over the past month in search of alternative investment vehicles to as bottom market real estate -- in Florida in particular -- is increasingly seen as a savvy investment vehicle. Key to any acquistion is an aggressive acquisiton price with long term value, and our current lack of demand relative to bloated supply supports that set of buying conditions.
Vero's rigorous height and density regs keep our housing units relatively fixed against a long term outlook of increased demand from boomers turning 60 until 2015. Both short and long term outlooks support the case for investment in Vero real estate where we are relatively immune from value dilution from sprawl that's impacted other areas.
Whether seeking your own vacation home, retirement oasis in paradise or an investment that will yield long term rewards, we can help find a deal for you as Sellers continue to wait for buyers offering a contract to set the basement on properties currently for sale.
Check out our updated inventory analysis that contains interesting stats from last quarter as well as year over year -- volume's up, pricing's down and list to sell ratio's remain soft as a rather robust market in lower price points may signal a typical 'bottom up' recovery and slow return to more balanced conditions between supply and demand.
October 2008 MarketWatch Dare We Say BUY, and Buy Now?
Why?! A simple function of supply and demand, now and long term.
Short term supply: Bloated, as inventory levels remain essentially unchanged with sales being offset by new listings. Demand? Non-existent, as buyers are frozen in a holding pattern.
Translation: right now buyers rule the roost more than they have in a long long time, and soft list to sell ratios mean now you'll be able to afford a lot more house that you could have just 30-60 days ago.
Long term: no matter what happens on Wall Street, Boomers will continue to turn 60 until 2015, and that's a lot of demand for life in paradise. And population shifts to the New South mean that Florida will remain high on the radar screen.
And what about supply? Vero's visionary 'low profile, low density' zoning and building regs mean that our island's housing units will remain as it is today, fixed and immune to sprawl that's caused some exodus from places like South Florida and even Naples.
If you're a buyer that long term sights set on Vero property -- not looking to make a fast buck -- think about the fundamentals that make today's market poised to offer you aggressive acquisition opportunities and support value in our real estate in the future.
Forget cash under your mattress. Where do you want to spend this Winter? In 5 years?
Living in paradise -- a place where most hope to vacation a week or two -- is a privilege with a quality of life that's difficult to put into words. Your kids can surf before school; you can walk the beach or curse the golf gods daily. And you can throw your snow shovel away!
Let us know what your real estate aspirations are so we can become your trusted counselor to make your plan a reality.
July 2008 MarketWatch: Election Watch, Jumbo Issues Cool High End Activity?
We've seen a heightened interest in aggressively priced single family properties
in the below $800,000 range, while showings of higher end properties has noticeably cooled.
It could be that buyers in this price range are watching and waiting for the November Presidential election
to sort out, with all kinds of potential tax implications in play. Another culprit could be a pronounced
tightening of jumbo mortgage monies that many in this price bracket rely upon for purchase of properties.
Regardless of the reason, pricing remains paramount and and with the higher end activity cooling
but pricing remaining as it currently is, savvy buyers in search of higher end properties --
particularly riverfront or canal front with private dockage can dominate negotiations with
sellers desirious of getting a contract on their properties.
For the past 60 days we've seen appreciation instead of the depreciation we've seen
for the past 18 months, in what could be a significant sign that we've bottomed out and are slowly,
slowly returning to modest, sustainable appreciation at perhaps 3-5% per annum. Existing home sales
stats and Case-Shiller Index stats to be released this week may shed light as well, though Case-Shiller
only collates data for 13 markets, and as a result magnifies the import of overbuilt markets in California,
Arizona, Nevada and Florida as it does not include stats for areas of the country with more balanced
conditions.
With pent up demand expected to break open post-election this Fall, August to October remain
prime months for opportunistic buyers to seize the market and make properties of interest theirs
as competition remains slim! We've got great mortgage partners who keep us abreast of creative
products to make financing great buys a reality, whether you're a first time buyer -- like the soon to be eliminated Federally-based Neimiah program that enables sellers to gift as much as 6% of purchase price
for buyer downpayment and closing costs -- or a great new product than enables buyers to securitize
their assets in lieu of liquidation to fund a purchase -- meaning your money can remain where it is,
earning income for you while serving as collateral to fund a savvy real estate purchase.
Bottom line: buyers still rule the roost and there are great buys out there for buyers who have vision
and understand the fundamentals that support the inherent value in Vero real estate thanks to existing
zoning regs that forever limit supply and national demographic shifts and aging Boomers that will impact
demand for the next 15 or so years!
June 2008 MarketWatch: So Much For Sleepy Summer!
So much for sleeply summers in Vero -- our traditionally slow season has been buoyed by the start of pent up buyer demand activity -- with both aged properties reduced to market-appropriate prices to generate buyers and new listings hitting the ground running with aggressive prices reflective of current market pricing.
As predicted, the deep water dockage opportunity we alerted our buyers to earlier in the month took multiple contracts within 48 hours. While that sale was spurred by a seller reduction, the majority of contracts were not spurred to purchase by new price reductions, rather by the Buyers themselves seizing the day by presenting offers for purchase that were negotiated into successful contracts -- and in many cases set the market basement for the prices with their offers that secured the purchase.
Sellers remaining on the market truly wish to sell; we remain firm in our advice that summer will serve as the key months in which to approach properties -- as we've already seen that our tradtionally sleeply summer selling season will be anything but for smart buyers.
May sales volume continued to surge on the barrier island as begun in April, nearly 20% over volume of the year prior, indicating many buyers' concurrence that values have bottomed out and pent up demand is beginning to appear. We remain of the opinion that we'll scud around for a couple of months until inflation, increased demand and reduced inventories begin to put the smallest bit of precipitious upward pressure on pricing this Fall. Check out our BUY-rated list and you'll see the majority have sold .
Buyers interested in our recent high profile uxury property auction: call or write us for a post mortem and for our own short list of BUY-rated oceanview, oceanfront and riverfront estates listed from the high $900s to mutli-milions that we're watching as potential candidates genuine BUY-rated opportunities.
May 2008 MarketWatch: It's Harvest Time for Low Hanging Fruit
Buyers began to at long last act upon leading economic indices increasingly indicating that our housing market has bottomed out in Indian Rvier County as the past week saw a frenzy of contracts flying for opportunistic values of at least 15 properties we noted, ranging from multi million dollar riverfront and oceanfront homes to condos in the $300K range. Many of these properties had languished on the market for years. It is important to note that the successful buyers were not spurred to purchase however by new price reductions, rather it was the Buyers themselves who seized the day and set the market basement for the prices with their offers that secured the properties' purchase. Another interesting note is that several high profile listings hit the market over the past month out of the box with aggressive list prices reflective of the price per foot of sales from the past six months -- an important sign that Sellers and their agents are increasingly recognizing the realities of our market.
And proving that properties priced well sell, and sell fast: an unbelievable opportunity for a sensational custom private dockage riverfornt estate hit the market last week as a short sale, priced barely over land value. As we predicted, it took multiple offers within 72 hrs and we're pleased to report that it was our savvy client whose contract was accepted by the Seller. Well done! Sellers remaining on the market truly wish to sell; we remain firm in our advice to clients that May and June will serve as the key months in which to approach properties -- as we've already seen that our tradtionally sleeply summer selling season will be anything but for smart buyers.
In April, sales volume on the barrier island surged a whopping 125%, reducing our bloated inventory down to 18 mos for homes and 15 mos for condos; pending sales, a forward looking indicator, also surged up 16% from February and up a whopping 75% from anemic December. All signs that after last May's stablilization followed by August's secondary tumble that our bottom has hit and that we will scud around for a couple of months until inflation, increased demand and reduced inventories begin to put the smallest bit of precipitious upward pressure on pricing.
April 2008 MarketWatch: Foreclosure Immunity on the Barrier Island?
A reminder to pundits opining that foreclosures that have yet to hit the books this year mean another year of pricing downturns: all real estate is local. The barrier island has been relatively immune from valuation dilution from foreclosures compared to Vero’s mainland, that has indeed been impacted, as several 2005-era projects seemingly purchased wholesale by investors now facing the likely prospect of foreclosure have seen values decline by as much as 40%. A 30% downturn in second home purchases is the major culprit to the island’s market malaise as supply simply exceeds present demand. Wall Street woes have no doubt contributed to the demand decrease, as have market downturns in key feeder markets along the Eastern seaboard. As the island’s sales are 80% cash, the island’s also been largely immune to the impact of the sub-prime mortgage mess… What’s the Rx to boost demand? Pricing needs to continue to correct, as Sellers’ listed over a year need to listen to the market response and reduce their pricing accordingly or take their homes off the market to reduce inventory supply to meet demand as less supply will begin to put stabilizing, then ultimately, upward pressure on pricing.
Pending Sales UpThe flurry of activity seen post-holidays has manifested itself in an up-tick of pending sales, our preferred forecaster of market movement as it is forward-looking and not backward looking as are closed transactions. Pendings are up 20% over January and February and up a whopping 80% over December. That said, we’ve seen and have heard much colleague anecdotal evidence that there is still a major disconnect between buyers’ and sellers’ perceived value of properties, with many an offer tendered but going nowhere as buyers continue to want bigger discounts than sellers are willing to provide. The good news is that if properties are priced to reflect current market conditions they SELL. Check out our BUY-rated list and you’ll see the majority have sold – and one of our picks slated for this month didn’t make it to publication as it’s already found a buyer… Pricing pricing pricing!
February 2008 MarketWatch: State of Movement
A recent Wall Street Journal piece detailed the fascinating results of the annual United Van Lines survey that often mirrors migration patterns in the country. Among findings: in addition to climate and quality of life, taxes appear to have a direct bearing on where folks are choosing to live, as states without an income tax – including Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington and Wyoming – are gained net domestic migrants. States with onerous state taxes like North Dakota and California -- home to the nation’s highest state income tax – ranked at the top of the out migration list last year with residents flocking to nearby South Dakota and Nevada.
Despite modest tax reform passed in our January 29 referendum and legislators’ promises of more to come, Florida’s two tiered tax system created by the Save Our Homes amendment may well be benefiting neighboring states of North and South Carolina, among the top five states of net in migration last year, despite having a state income tax Florida lacks. While much needed insurance reform has made the cost of coverage far more affordable for full and part time property owners, legislators would be wise to heed the call for continued tax reform to be sure that Florida remains among the top destination states as it was in the annual survey.
Activity Buzz Continues
The flurry of activity we’ve seen and heard of from colleagues can showed no signs of slowing down, as buyers from across the country – and globe – have decided to seize the day and make the market theirs by scooping up at often great deals properties that suit their needs. In many cases pricings are rolled back to 2004 levels and list to sell ratios remain very soft, but buyers, buoyed by our low density, low profile growth policy are confident that our already finite pool of housing product will not be diluted in the future by sprawl and that investment in Vero real estate will return to modest and sustainable appreciation by year’s end. Inventory levels remain about the same, as sellers hopeful for a market turnaround listed properties for sale; as a result we see pricing flat or perhaps down 5% by end of year until inventory levels reduce to meet demand. Oceanfront of any kind and condos remain among the softest property types, while pricing in the under $600 for homes and $1.5-2M range for riverfront homes remain particularly robust, with properties of any type over $3M taking often well over a year to find a buyer. Of condos sold last month, more were in the $2M+ range than any other,perhaps signaling that only buyers at the very high end are not off put by post-storm escalated monthlies that have deterred many buyers, with fees acting as a rock pushing down the valuations of lower priced units….
Januuary 2008 MarketWatch: Buyers Flock To Vero
What a difference a few weeks can make in this heavily psychological phenomenon we call the real estate market. Buyers were an endangered species last Fall through our typically slow holidays. Fast forward to January 2008,
cold weather across much of the nation and whammo! buyers are back big time, seizing what we believe
to be bottom market pricing producing bargains galore of all housing types and products. For months, we've seen pent up demand across the globe via record breaking hits on our Internet site; our own experience with buyers from across the globe since the new year evidences buyers' willingness to buy, reinforced by
similar scenarios expressed to us by colleagues. We've written multiple contracts this week and continue to have calls from clients making plans to come to town now through March specifically to preview properties for purchase.
What does all of this activity mean for buyers and sellers? Buyers, get off that fence -- seize the
market,</b> as the truly good deals are getting scooped up - let us help you figure out which is the best deal to suit your needs. Sellers: re-evaluate your pricing if you're already listed, or ask us for a market valuation estimate to see if our current momentum just might not be the right environment in which to sell your property. Rates will continue to decline as the year progresses, having a stimulative effect on the market as it continues to pull out of its malaise and returns to more moderate --but sustainable -- appreciation toward the end of this year.
December MarketWatch: W Spells Recovery? |
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TRENDS/ANALYSIS: W for Recovery?
Most analysts agree that housing recoveries resemble Ls or Vs – a sharp downturn followed by a flat period (L) leading to eventual recovery or a sharp downturn followed by an equally sharp upturn (V). We contend that our current recovery’s a hybrid, looking more like a W, as our decline appeared to recover in June and July (a V) but then turned downward again at the start of the fourth quarter but again shows signs of recovery (another V, making a W)…Why the W?
Perhaps because this housing downturn was fueled by speculation, loose underwriting standards and Fed interest rate tinkering while other housing downturns had more fundamental economic roots like unemployment and job related issues tied to overall economic growth…
Subtle Changes: Some Properties Are Selling FAST
Yes, inventory remains bloated and sales remain scant, but last month we saw the start of a significant change to sales data: in the past 12-18 months, virtually all sales took over 120 days to find a buyer. Last month, however, only 50% of sales took 120 days to sell, while 20% of sales sold within 0-30 days and another 20% sold within 31-60 days. Proof that buyers are indeed ready, willing and able to scoop up properties priced to reflect current market conditions.
We saw evidence of this recently, as two properties we alerted clients to as the very best choice for them in terms of pricing and locale both took contracts within days of our notification. So listen up, buyers: when we call a property BUY-rated, it will sell – and soon.
Where did our rebound go? Robust sales activity of the past several months that reduced inventory to its lowest point in 18 mos came to a grinding halt in September and October, typically a slow period for our market. Here's the real question: is the slowdown seasonal or symptomatic of erosion in our recovery as buyers continue to wait on the sidelines? For the first time in 18 mos, condo sales outpaced single family home sales on the island and our two tiered market becoming more prevalent, as 41% of inventory is priced below $700,000 while nearly 20% is priced over $2,000,000. The middle section of the market in the $800-$1.8M range continues to struggle, leaving this key 'move -up' section of our market stalled. Inventory is fairly evenly spread across the island, with the Indian River Shores area having the largest number of both condos and single family homes for sale -- a function, likely, of being the small area on the island where our tough density laws have placed the majority of our condos.
A glance at our scant sales -- only 10 houses on the island -- also show our two tiered market, with sales only under $625 and OVER $2M. Good news: pent up demand appears to be strong, as our web traffic since Oct 1 is up a whopping 56% from browsers across the globe, many of whom have currency stronger than our dollar. The $64,000 question is however, when and how much of it will convert to buyers, as pending sales reveal scant activity continuing across the island....
With its finite product supply and predominance of cash buyers, the island remains the stronger segment of the Vero market, yet condos throughout the entire area remain by far the softest type of housing product, a result of diminished buyer demand from overbuidling on the mainland and escalated fees on the island after the '04 storms. Tax reform appears likely to be passed, perhaps accelerating our return to more balanced market conditions. Tax reform of some sort appears likely to be passed, perhaps accelerating our return to more balanced market conditions. As the old adage says "Bells don't ring when you hit a bottom..." it's tough to time a market: once you think it's there, you've likely waited too long.
Our advice to savvy buyers remains unchanged: seize the market and make it yours.
Regardless of your wish list or price point, there are sellers ready, willing to deal on their properties -- give us a call to help you sift through what can be an overwhelming number of choices to help you make your best buy for instant equity in this rare buyers' market.
Buyers, you remain in the driver's seat!
Our August BUY-rated picks are all fabulous opportunities for savvy buyers, priced below market value in communities with established appreciation -- a savvy buy for instant equity. (These are not our listings; we've no vested interest in them, just find them great opportunities)
Our listings are all fabulous deals, too, The River Penthouse, an unbelievable riverfront penthouse that lives like a single family home with its 3,500 sq ft but offers the sweeping views and luxury of carefree, concierge living that only a penthouse could provide...
PS: Check out our full roster of BUY-rated picks. Many have sold or been reduced further!
Market fundamentals including population aging trends and in-migration continue to combine with Vero's relative affordabilty compared to other seaside communities and tough height and density regs to insure solid return on investment.
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Bottom Line: don't let bloated inventory levels and price corrections overshadow our strong market fundamentals -- it's a rare buyers' market, and truly a great time to get more for your dollar in Vero:
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After an initial price correction last year, average pricing in the County is UP from last year: prices are in fact appreciating, albiet not at the double digit levels we'd grown accustomed
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Sales levels remain HIGH ( '06 set to be 3rd highest year of sales on record), as mortgage rates remain historically LOW
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Florida will remain among those states with the highest in-migration thanks to generations of boomers turning 60 until 2015
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These factors will combine with Vero's relative affordability compared to other coastal communities to support investment in Vero Beach real estate.
A Northeastern transplant myself, I understand the questions and concerns that impact your decision making. Whether you plan to live in Vero and work elsewhere, live and work in Vero or enjoy your Vero property as a retirement or second home, it would be my privilege to send you additional information on Vero Beach, sample listings or to alert you when properties of interest hit the market.
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