Finding Values in Florida
Jane Araguel, a Realtor based in Destin, Florida, will always remember the 2004-2005 hurricane season.
“This area went 65 years without a hurricane. Then all of a sudden we had four in a matter of months,” she says. “My telephones quit ringing in the first few months of 2005.”
Property values that had been spiking suddenly started to drop. Four years and one recession later, Realtors still are working to move a backlog of homes and condos. It’s good news for investors, who can buy a formerly $1 million home for $400,000.
“The values are 60 percent lower than in 2004,” Araguel says. “Real estate is an amazing investment right now.”
The story has been repeated in many areas of Florida as an oversaturated real estate market continues to recover from the shocks of the past few years.
“It is a fabulous time to buy,” says Sarasota Realtor Barbara Ackerman. “In our region, there’s been at least a 30- to 35-percent correction in the market from 18 months ago. You can get a single-family home with beautiful Intracoastal water views for $2.5 million in the Sarasota area. We have not seen these prices for a very long time.”
The drop in home values presents a rare opportunity for buyers. Araguel says condos that were selling for $600,000 to $700,000 just a few years ago are now going for $250,000. “Until we get all of the extra inventory cleared, the prices will stay low,” Araguel says. “But there’s no doubt they will rise again. The question is when.”
Ackerman says the only exception to the rule has been prime beachfront properties, whose values have not dropped. “Those homes don’t often come on the market,” she adds. “The Gulf of Mexico is gorgeous and quiet, and the sand rivals any of the islands in the Bahamas. People know they’ve got something special down here.”
Realtor Ray Corcoran of Boca Grande says premium homes in his region also tend to stay off the market. “At that level, if people need to wait a year or two to sell, they wait,” he says. “We’re seeing more activity in the lower-end market.”
Corcoran says Realtors are working to sell approximately a nine-month inventory of homes in his area. “A couple of years ago, we had more than three years’ worth on the market,” he says. “The homes have really moved fast.”
Corcoran says prices have stopped falling and may start creeping up again in the near future. But for now, “People are out here buying, and they’re really getting the advantage.”
—Jennifer Martin
Photo courtesy RE/MAX Coastal Properties
[...] Finding Values in Florida By Jennifer Martin [...]
[...] Finding Values in Florida By Jennifer Martin [...]