South Florida's housing sector asserted its independence from national trends in July as a key measure of the real estate market improved year-over-year, with the region's international buyers and still-drooping prices propping up the local housing market.
In July, pending home sales in Miami-Dade County stood at 10,113, up 40.5 percent from July of 2009, according to figures released Tuesday by the Miami Realtors. In Broward, pending sales stood at 7,830 in July, up 25.4 percent from a year earlier.
Pending home sales refer to the number of housing contracts that have been signed, and offer an early indicator of sales activity because typical sales have a one- to two-month lag between a sales contract and a completed deal.
South Florida sizes up well when compared to the national picture, where the pending home sales index hit a record low 75.7 in June, according to the National Association of Realtors. It was the second monthly falloff after the April 30 deadline to enter the federal homebuyer tax credit program, with June's pending sales down nearly 19 percent from the same month a year earlier.
The local market hasn't been completely immune from the post-tax-credit slump. In the past three months, pending home sales are down 3.2 percent in Miami-Dade and down 5.1 percent in Broward.
``We are encouraged by the statistics for pending home sales in the South Florida real estate market even after the expiration of the homebuyer tax credit,'' Jack H. Levine, chairman of the board of the Miami Realtors, said in a statement. ``While the number of pending sales has dropped slightly month-over-month, they are still significantly higher than they were a year ago.''
With financing still difficult to obtain, all-cash buyers and deep discounts on distressed properties are propping up sales, said Peter Zalewski, a principal at Bal-Harbour-based Condo Vultures.
About 60 percent of South Florida sales have gone to foreign buyers, who are more likely to pay with cash and were never eligible for the tax credit.
Additionally, more than half of recent sales in Miami-Dade and Broward counties involve short sales or bank-owned home sales. In the last 12 months, the number of bank-owned condos and single-family homes sold has more than doubled.
A short sale occurs when a home is sold for a price that is less than the value of the outstanding mortgage. In what has become a notoriously lengthy process, both the seller and the bank must agree to the price.
Banks have recently become more willing to allow sellers to pursue short sales, which now account for one in four South Florida sales.
There were 944 short sales in Miami-Dade and Broward in June, up from only 379 a year earlier, according to analysis by Esslinger-Wooten-Maxwell Realty.
That's a reason to be cautious while interpreting pending homes sales data in a market like South Florida's, said Doug DeWitt, Miami-based real estate broker.
Many short sale contracts are rejected by the bank after a seller agrees to sell for a price below what they owe, meaning those pending sales don't lead to closings.
Additionally, because short sales take months to process, many remain in the ``pending'' stage longer than normal, boosting pending sales numbers for multiple months.
In Miami-Dade County, more than half of the pending single-family home sales on the Multiple Listing Service are short sales, said DeWitt.
``I'd say at least half of those are not going to close,'' he said. ``I would say stick to the actual closed sales to make the true comparison, because there's a lot of different ways that these pending sales can fall through.''
The increasing number of short sales and bank-owned properties coming to market has put downward pressure on prices in South Florida, said Jack McCabe, chief executive of McCabe Research & Consulting in Deerfield Beach. In June, median prices of existing homes stood at $203,300 in Miami-Dade, down about 4 percent from the same month a year earlier. Median existing condo prices, at $128,000, were down about 9 percent in Miami-Dade.
``When you're in a neighborhood that has two foreclosures and a short sale that are priced $50,000 or $75,000 below what you thought you could get for your home, you do not set the barometer for the other [home] prices,'' McCabe said. ``They set the prices for you.''
Tejus Karia, who has been trying to sell his Davie townhouse for eight months, has cut prices multiple times.
He has slashed the price on the three-bedroom, from $185,000 to $165,000 to draw in buyers but didn't get a single offer. He recently decided to rent it instead.
Zalewski said many sellers are coming to accept the new, lower pricing levels being dictated by the market, and are acting accordingly.
According to a report by Trulia, one in five home sellers in the Miami area slashed prices last month, with an average reduction of 13 percent.
Karia said the main obstacle for most of his buyers was the lack of financing: ``Nobody could come up with the money. The banks aren't lending money, and that's going to leave a lot of these houses in limbo.''
Source: http://www.miamiherald.com/2010/08/03/v-fullstory/1760066/for-s-fla-market-a-hopeful-sign.html
By TOLUSE OLORUNNIPA
tolorunnipa@MiamiHerald.com
The Criscitos has been selling South Florida luxury and commercial real estate for over a decade and has sold over $1 billion dollars of property. They work as a multi-lingual team speaking english, Spanish, Italian and Portuguese. They carved out a niche as a leading boutique real estate company with two distinct divisions -residential and commercial- both personally overseeing by Marcela and Anthony Criscito.
Showing posts with label sign of recovery. Show all posts
Showing posts with label sign of recovery. Show all posts
Thursday, August 5, 2010
Monday, April 26, 2010
Home-sale surge a sign of recovery
Driven by drop-dead prices on foreclosures and short sales and a looming deadline for federal tax credits, home and condo sales in South Florida shot up in March, brightening the outlook that this year may herald a real estate recovery.
At the same time, wealthy buyers who have waited on the sidelines as the market tumbled are now jumping in. Those investors are opting to put their cash into property rather than risk it in the still-volatile stock market, real estate agents say.
``What we are seeing is that prices have dropped 40 to 50 percent since the height of the market, which has made attaining a home much more affordable,'' said Jack McCabe, chief executive of McCabe Research & Consulting in Deerfield Beach.
In Miami-Dade County, sales of existing homes rose 17 percent in March compared to the same month last year, and median prices declined 4 percent to $197,500, according to figures released Thursday by the trade group Florida Realtors.
At the same time, condominium sales jumped 58 percent to 835 sales, while median prices fell 8 percent to $138,800.
Figures for Broward County trailed Miami-Dade's, with existing home sales up 8 percent in March, and median prices falling 3 percent to $214,000, compared to the same month last year.
March condo sales jumped by 46 percent to 1,140 in Broward, while median condo prices fell 10 percent to $73,600, compared to March 2009, the figures show.
While rising sales are uplifting news, analysts differ on whether South Florida's real estate prices have hit rock bottom, which is likely the true test of an incipient recovery.
David Dabby, president of the Dabby Group in Coral Gables, believes prices have stabilized since hitting the floor in April 2009. They've been wavering -- some months up slightly, others down -- at the same low level since then.
``The market is in recovery, but it's a very weak recovery, and no price recovery, just price stabilization,'' Dabby said. ``Stabilization of prices is the best we can hope for in the foreseeable future.''
FUTURE PRICES
Meanwhile, McCabe is betting South Florida prices will hit bottom between the end of 2010 and mid-2011, with condo prices possibly continuing to decline until the end of 2011, due to the high supply of condos on the market.
``Foreclosure activity is continuing to drive the market and will keep a lid on prices for the foreseeable future,'' Dabby said.
During March, he said 55 percent of all single-family home sales in Miami-Dade were foreclosures or short sales, in which lenders allow homes to be sold for less than the mortgages owed against them.
``It's just a foreclosure buying binge, and I hope it continues, because that is the only way we will return to a normal market,'' he said.
According to data from EWM Realtors, nearly 24,000 homes and condos were available for sale in Miami-Dade at the end of March. That has been whittled down since March of last year, when 34,123 homes and condos were on the market. Similarly, in Broward, 17,469 homes and condos were on the market at the end of March, down from 26,668 one year ago, EWM Realtors data shows.
Wealthy buyers are heating up the market and helping to absorb the supply, some Realtors say.
``This first quarter is the best first quarter we've had certainly in the last three years,'' said Claudia Lewis, a Realtor with Century 21 Premier Elite Realty in Coral Gables. ``It has been so active, most agents are working 12, 13, 14 hours a day.''
In recent weeks, Lewis has sold or delivered contracts for a $3 million house in Redland, a $2 million house in Pinecrest and three $1 million-plus condos in Coconut Grove.
``The market has just changed dramatically from the fourth quarter of 2009 to the first quarter of 2010,'' she said. ``There has been a dramatic increase in activity and sales.''
FINANCING
Nudging the market further is financing -- when available -- remains affordable, with mortgage rates hovering at about 5 percent.
In fact, even foreign investors are again abundant, particularly from Europe and Latin America, said Maria Visser, international director/corporate relocation, and a broker associate with Century 21 Premier Elite Realty in Coral Gables.
``What they are seeing is that prices are low, interest rates are low -- when has it been this attractive to buy here?'' she said.
Yet another financial impetus: Potential buyers have one week left to gain access to federal tax credits, geared to stimulate sales.
Buyers who have signed a contract to purchase a primary residence by April 30 have until June 30 to close to be eligible for the federal tax credit of up to $8,000 for first-time buyers and up to $6,500 for repeat buyers.
``We're seeing a last-minute rush here for people trying to capitalize on this, and I have several buyers coming to town specifically to find something with the intent of making a contract before the end of the month to meet the deadline,'' said Steve Scarpone, a Realtor with Coldwell Banker in Kendall.
To spur sales even after the deadline, Coldwell Banker is asking its sellers to agree to pay $8,000 toward a buyer's closing costs after May 1.
In fact, a survey released this week by Century 21 Real Estate showed that first-time home buyers rated the three most influential factors in their decision to buy a home as current housing prices (66 percent), followed closely by the home buyer tax credit (63 percent) and low interest rates (60 percent).
ACROSS U.S.
Nationwide, existing-home sales, including single-family, townhomes, condos and co-ops, rose 6.8 percent to 5.35 million in March, compared to 5.01 million the previous month, according to data from the National Association of Realtors.
The median sales price rose 0.4 percent in March to $170,700, and sales were up 16.1 percent, compared to March 2009, marking the beginning of an expected spring surge, the association said.
The home buyer tax credit is spurring sales across the nation, said Lawrence Yun, chief economist for the association. A NARS survey shows first-time buyers purchased 44 percent of homes in March, up from 42 percent in February. Investors accounted for 19 percent of transactions in March, unchanged from February; the remaining sales were to repeat buyers.
``The home buyer tax credit has been a resounding success as these underlying trends point to a broad stabilization in home prices,'' Yun said in a statement. ``This is preserving perhaps $1 trillion in largely middle class housing wealth that may have been wiped out without the housing stimulus measure.''
Source: http://www.miamiherald.com/2010/04/22/1593777_p2/home-sale-surge-a-sign-of-recovery.html
BY INA PAIVA CORDLE
icordle@MiamiHerald.com
At the same time, wealthy buyers who have waited on the sidelines as the market tumbled are now jumping in. Those investors are opting to put their cash into property rather than risk it in the still-volatile stock market, real estate agents say.
``What we are seeing is that prices have dropped 40 to 50 percent since the height of the market, which has made attaining a home much more affordable,'' said Jack McCabe, chief executive of McCabe Research & Consulting in Deerfield Beach.
In Miami-Dade County, sales of existing homes rose 17 percent in March compared to the same month last year, and median prices declined 4 percent to $197,500, according to figures released Thursday by the trade group Florida Realtors.
At the same time, condominium sales jumped 58 percent to 835 sales, while median prices fell 8 percent to $138,800.
Figures for Broward County trailed Miami-Dade's, with existing home sales up 8 percent in March, and median prices falling 3 percent to $214,000, compared to the same month last year.
March condo sales jumped by 46 percent to 1,140 in Broward, while median condo prices fell 10 percent to $73,600, compared to March 2009, the figures show.
While rising sales are uplifting news, analysts differ on whether South Florida's real estate prices have hit rock bottom, which is likely the true test of an incipient recovery.
David Dabby, president of the Dabby Group in Coral Gables, believes prices have stabilized since hitting the floor in April 2009. They've been wavering -- some months up slightly, others down -- at the same low level since then.
``The market is in recovery, but it's a very weak recovery, and no price recovery, just price stabilization,'' Dabby said. ``Stabilization of prices is the best we can hope for in the foreseeable future.''
FUTURE PRICES
Meanwhile, McCabe is betting South Florida prices will hit bottom between the end of 2010 and mid-2011, with condo prices possibly continuing to decline until the end of 2011, due to the high supply of condos on the market.
``Foreclosure activity is continuing to drive the market and will keep a lid on prices for the foreseeable future,'' Dabby said.
During March, he said 55 percent of all single-family home sales in Miami-Dade were foreclosures or short sales, in which lenders allow homes to be sold for less than the mortgages owed against them.
``It's just a foreclosure buying binge, and I hope it continues, because that is the only way we will return to a normal market,'' he said.
According to data from EWM Realtors, nearly 24,000 homes and condos were available for sale in Miami-Dade at the end of March. That has been whittled down since March of last year, when 34,123 homes and condos were on the market. Similarly, in Broward, 17,469 homes and condos were on the market at the end of March, down from 26,668 one year ago, EWM Realtors data shows.
Wealthy buyers are heating up the market and helping to absorb the supply, some Realtors say.
``This first quarter is the best first quarter we've had certainly in the last three years,'' said Claudia Lewis, a Realtor with Century 21 Premier Elite Realty in Coral Gables. ``It has been so active, most agents are working 12, 13, 14 hours a day.''
In recent weeks, Lewis has sold or delivered contracts for a $3 million house in Redland, a $2 million house in Pinecrest and three $1 million-plus condos in Coconut Grove.
``The market has just changed dramatically from the fourth quarter of 2009 to the first quarter of 2010,'' she said. ``There has been a dramatic increase in activity and sales.''
FINANCING
Nudging the market further is financing -- when available -- remains affordable, with mortgage rates hovering at about 5 percent.
In fact, even foreign investors are again abundant, particularly from Europe and Latin America, said Maria Visser, international director/corporate relocation, and a broker associate with Century 21 Premier Elite Realty in Coral Gables.
``What they are seeing is that prices are low, interest rates are low -- when has it been this attractive to buy here?'' she said.
Yet another financial impetus: Potential buyers have one week left to gain access to federal tax credits, geared to stimulate sales.
Buyers who have signed a contract to purchase a primary residence by April 30 have until June 30 to close to be eligible for the federal tax credit of up to $8,000 for first-time buyers and up to $6,500 for repeat buyers.
``We're seeing a last-minute rush here for people trying to capitalize on this, and I have several buyers coming to town specifically to find something with the intent of making a contract before the end of the month to meet the deadline,'' said Steve Scarpone, a Realtor with Coldwell Banker in Kendall.
To spur sales even after the deadline, Coldwell Banker is asking its sellers to agree to pay $8,000 toward a buyer's closing costs after May 1.
In fact, a survey released this week by Century 21 Real Estate showed that first-time home buyers rated the three most influential factors in their decision to buy a home as current housing prices (66 percent), followed closely by the home buyer tax credit (63 percent) and low interest rates (60 percent).
ACROSS U.S.
Nationwide, existing-home sales, including single-family, townhomes, condos and co-ops, rose 6.8 percent to 5.35 million in March, compared to 5.01 million the previous month, according to data from the National Association of Realtors.
The median sales price rose 0.4 percent in March to $170,700, and sales were up 16.1 percent, compared to March 2009, marking the beginning of an expected spring surge, the association said.
The home buyer tax credit is spurring sales across the nation, said Lawrence Yun, chief economist for the association. A NARS survey shows first-time buyers purchased 44 percent of homes in March, up from 42 percent in February. Investors accounted for 19 percent of transactions in March, unchanged from February; the remaining sales were to repeat buyers.
``The home buyer tax credit has been a resounding success as these underlying trends point to a broad stabilization in home prices,'' Yun said in a statement. ``This is preserving perhaps $1 trillion in largely middle class housing wealth that may have been wiped out without the housing stimulus measure.''
Source: http://www.miamiherald.com/2010/04/22/1593777_p2/home-sale-surge-a-sign-of-recovery.html
BY INA PAIVA CORDLE
icordle@MiamiHerald.com
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