Lenn Harley posted yesterday about market data and the media. She pointed out that it is not all about the price but also about the volume of sales. In her area the price is up 57% since 2002 but volume is down 59%. She explains it better than me so here's the link....go read and her post. I'll wait...........la la la la la la. Ok are you back?
Anyway, Lenn's post inspired me to do a little research on my market, Poinciana, Fl., to see how things have changed since 2002.
Here's a little chart I put together:
Price and volume comparisons 2002-2007
Poinciana FL.
YEAR | SALES | % CHANGE | AVE. PRICE | % CHANGE |
2002 | 494 |
| $ 94,000 |
|
2003 | 716 | + 31% | $107,000 | + 12% |
2004 | 923 | + 22% | $131,000 | + 18% |
2005 | 1256 | + 27% | $189,000 | + 31% |
2006 | 1075 | ( -14%) | $217,000 | + 13% |
2007 | 409 | (-62%) | $194,000 | (- 11%) |
OK, here are my comments. First statistics can always be deceiving and don't necessarily show the entire picture. For example, these stats are from the MLS. But what about new construction?
According to City Data, Poinciana had a population of 13,647 in 2000. Right now our population is roughly 68,500!! That's an increase of 491%. That means there were a ton of new homes built in Poinciana during this 7 year period. Most of these were built during the boom period of 2002 to 2006. If I were to estimate 5 people per household that would be close to 10,000 homes. That sounds about right to me.
According to my chart values are only down 11% this year from 2006. That may be true for homes sold through the MLS but it is not true based on my experience. There are currently 1149 SFH on the market in Poinciana neighborhoods. 404 of these were built in 2005 or later. There are also 554 homes currently under construction. What this means is new construction is a major part of Poinciana's market. Based on the analysis, that I do daily for potential Sellers, values are down 25% to 30%. If they bought a new house in 2006 for $250,000 it may be worth $180,000 at this time. That's a decrease of 28%.
But the true indicator of market conditions is the sales volume. The amount of homes sold through the MLS is down 62% from last year. I'm not sure the exact number but new construction is down at least that if not more. Our absorption rate is currently 36 months!!
According to my research, look at the chart again, if you bought your house in 2004 or earlier then you should be in a pretty good position. Values have actually more than doubled since 2002 and have increased 32% since 2004!!!
So folks, the reality is even though the RECENT decline in prices and volume are pretty drastic, overall, if you bought your house at least 3 years ago you have experienced good appreciation and should be in an excellent position to sell or refinance if you need to. This of course, assumes you haven't already refinanced and spent all of your equity. Did you?
IN SUMMARY
If you have no equity in your house, you either have not lived there at least 3 years or you have already spent it. This is the reality of market conditions in Poinciana Fl. Is your reality in line with reality?
Copyright © 2007 Broker Bryant Real Estate Ramblings | All Rights Reserved
Comments(27)