Is Your Reality In Line With Reality? Poinciana Fl.

By
Real Estate Broker/Owner with Tutas Towne Realty, Inc and Garden Views Realty, LLC BK607690

Call me!!! 407-873-2747 

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?

www.buypoinciana.com

Copyright © 2007 Broker Bryant Real Estate Ramblings | All Rights Reserved

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Ambassador
557,018
"The Lovely Wife" (Broker Bryantnulls Wife) The One And Only TLW.
President-Tutas Towne Realty, Inc. - Kissimmee, FL

Lane...

I reserve my parking spot with a kiss :)

TLW...ROAR!

Dec 13, 2007 07:00 AM #8
Rainmaker
1,142,060
Bryant Tutas
Tutas Towne Realty, Inc and Garden Views Realty, LLC - Winter Garden, FL
Selling Florida one home at a time

Dan, You are right. And those are exactly the foks that the rate freeze is supposed to help. My question is why? Why should they have expected appreciation in such a short period of time? And they never should have taken out an ARM expecting to be able to rtefiance within a 24 month period. It's utter foolishness.

Marc, Yep it does. I hear it every day. Well cry me a river. I bought 4 properties in 2005 and I too have lost a lot of equity BUT I was smart enough to get fixed rate mortgages.

Candace, Poinciana is one big PUD(planned unit developement). Our association has a monthly paper and on the back they published how many homes are under construction and haow many folks have moved into the area. It's very handy info.

Jennifer, I've been sellling property in Poinciana for almost 14 years. I'm used to working a difficult market.

Randy, Volume is certainly way down. Look how our values have more than doubled in 5 years. That's awesome!!

Lane, I too find it hard to put a positive spin on things when the reality is the market sucks!!!

TLW, xyz :)

 

 

Dec 13, 2007 07:09 AM #9
Rainmaker
1,142,060
Bryant Tutas
Tutas Towne Realty, Inc and Garden Views Realty, LLC - Winter Garden, FL
Selling Florida one home at a time
Dec 13, 2007 07:11 AM #10
Rainmaker
340,012
Ann Cummings
RE/MAX Shoreline - NH and Maine - Portsmouth, NH
Portsmouth NH Real Estate Preferrable Agent

BB - WOW, is all I can say to that kind of growth in that short of a time period!  That's amazing to see those kinds of numbers....  your chart is a great way to show in writing what reality is to potential sellers.  And then to factor in the new construction sales and the impact of those on the market over that same time period.

I'm still thinking -->  WOW to that growth!

Ann

Dec 13, 2007 07:16 AM #11
Rainmaker
707,379
Bill Roberts
Brooks and Dunphy Real Estate - Oceanside, CA
"Baby Boomer" Retirement Planner

BB, OK, you got me here. I commented on Lenn's post after you did. I had a few questions for her. The idea being that there are a lot of factors in todays market not the least  of which is "general perception" and other economic conditions.

Assessing what the average price should be now in relation to 2002 is going to be difficult. All the new construction in your area is going to raise prices because the houses are probably bigger and better than what was generally available in 2002. But if you calculate your 2002 value per square foot then add 5% per year for inflation (not growth, that's another factor) you should be able to come up with a value per square foot today. Apply that to a typical house that is available for sale might give you a useful comparison.

Anyway, the absorption number means nothing to me. If home sales pick up next month then the number will be very different. Actual sales numbers are interesting, but only interesting not meaningful.

Your population growth is really something. Are they all going to stay there? What I'm asking is, "is  it real?"

But  back to the other post, I can't believe you want more foreclosures. Who does that help? Speculators, bottom feeders?

Bill Roberts 

Dec 13, 2007 07:20 AM #12
Rainmaker
1,142,060
Bryant Tutas
Tutas Towne Realty, Inc and Garden Views Realty, LLC - Winter Garden, FL
Selling Florida one home at a time

Bill, I certainly do not want more foreclosures. BUT it is what it is. It's my opinion that the faster we crash we faster we can start rebounding. My market is being devastated by foreclosures and next year is going to be quite a bit worse. Most of them are flips that flopped. Poinciana was raped by Investors during 2005 and 2006. They came down from NY and up from South Florida and caused our prices to sky rocket. Poinciana is just a working class community. Still to date the highest resale in Poinciana EVER(not counting Solivita) was $375,000.

Poinciana is a family neighborhood. 50% of our population is under 18. They will stay. It was, and will be again, affordable housing right in the middle of the State. One hour to Orlando and one hour to Tampa.

Commercial properties are booming in Poinciana right now. That's a good sign.

Ann, we have certainly experienced tremendous growth over the last 5 years or so. We still have room for about another 100,000 people. Poinciana is the second fastest growing PUD in the country. There were only 7,000 people when we first started selling here about 14 years ago.

Dec 13, 2007 07:33 AM #13
Rainmaker
123,462
Rebecca Savitski
BSR Real Estate Group - Cary, NC
NC Real Estate Listings
How many of the sales were due to investors? Do you have the data to support that? Just curious.
Dec 13, 2007 07:57 AM #14
Rainer
292,552
Diane Aurit
LKN Realty, LLC - Mooresville, NC
Lake Norman Real Estate
Nice, clear analysis of your market.  I just wrote a post for my Lake Norman area trying to address the realities of our market vs. the media as well.  I think this may be our most important role right now!
Dec 13, 2007 07:57 AM #15
Ambassador
2,739,883
Lenn Harley
Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate - Leesburg, VA
Real Estate Broker - Virginia & Maryland

Bryant.  There are very few new homes that are not listed in our MLS.  Ryan Homes in MD for one is not in the MLS because they don't co-op. 

The point I was making is that, just because prices are holding up in our area, sales are way down.  The trend is also down, down, down. 

As I see it, there are two big differences in your market and mine. 

1.  You have more investment and second home buyers which are much more subject to foreclosure than our owner occupied homes. We do have a number of investor owned homes on the market or in foreclosure but they're all real estate agents to tried to buy new and flip.  Can't have a lot of sympathy for them.

2.  Our prices simply out paced our buyers income dramatically.  If the average price had held steady at the affordability range, for most buyers around $450,000 or even $500,000, we'd still be selling.  But, no, they had to keep driving the prices up, agents did that to get the listings and then the lenders would finance anyone who could fog a mirror.  Once the average price got over $700,000, it was over. 

Nice post.  I love the stats, being the stats junkie that I am.

 

Dec 13, 2007 08:19 AM #16
Rainmaker
1,142,060
Bryant Tutas
Tutas Towne Realty, Inc and Garden Views Realty, LLC - Winter Garden, FL
Selling Florida one home at a time

Lenn, I wrote this just for you:) I know how much you love stats. We actually had very few builders with inventory in the MLS. That has changed some now. Even Maronda homes just started offering commissions to agents. That's a first for them in about 30 years of being in business!

Diane, I agree. It's good for folks to be able to see LOCAL data.

Rebecca, I don't know. I do know that a large portion of the new construction over the last 3 years was investor bought. If I had to take a guess I would say as much as 50%. Village 7 in Polk county Poinciana looks like a ghost town with all the empty "flips that flopped". That was our busiest neighborhood in 2005 and 2006.

Dec 13, 2007 08:37 AM #17
Ambassador
920,196
Missy Caulk
Missy Caulk TEAM - Ann Arbor, MI
Savvy Realtor - Ann Arbor Real Estate
Gosh, Bryant you really did start seeing market changes in 2005. We saw them so much earlier that we are use to it. Not happy but use to it.
Dec 13, 2007 08:47 AM #18
Rainmaker
224,121
Laurie Mindnich
Centennial, CO

BB, these are critical points to consider, from the comfort of a holiday time chair.  Let me ponder.

Dec 13, 2007 09:46 AM #19
Ambassador
1,509,132
Renée Donohue~Home Photography
Savvy Home Pix - Allegan, MI
Western Michigan Real Estate Photographer
Great post BB!  I missed Lenn's post so thanks for pointing out that one.  He who holds the keys will win!  With my market, I am watching new construction very close also as this is what I am selling and buyers are interested in (along with REO)
Dec 13, 2007 11:25 AM #20
Rainmaker
338,442
Gary Bolen
McCall Realty - South Lake Tahoe, CA
CRS - Lake Tahoe Real Estate Information

Yep, this is the telltale stuff. Lenn's good at presenting it. So are you. Seems that all markets have this in common, if they have had their home for five years, they make good money. But they don't make any that never existed. Good post... but we expect that from you.  Bertha though, that's a toss up ball.

Cheers 

Dec 13, 2007 12:30 PM #21
Rainmaker
595,381
Lisa Hill
Florida Property Experts - Daytona Beach, FL
Daytona Beach Real Estate
Do you have the data for the properties that weren't in the MLS and weren't new construction. As in FSBOs?
Dec 13, 2007 12:52 PM #22
Rainmaker
237,749
Marlene Bridges
Village Real Estate Services, Inc. - Laguna Hills, CA
Laguna Homes|Laguna Condos|Laguna Real Estate
BB - Nice analysis.  We sure can be misled by the data unless we understand how is was collected.  It's just more proof that folks need to work with agents like yourself who intimately understand their market.
Dec 13, 2007 03:34 PM #23
Rainer
155,621
R. B. "Bob" Mitchell - Loan Officer Raleigh/Durham
Bank of England (NMLS#418481) - Raleigh, NC
Bob Mitchell (NMLS#1046286)

Pretty wild figures there... would the moral of the story be to concentrate your marketing efforts on people who have been in their homes over 3 years then?

 

Bob Mitchell

ValueList Real Estate Services, Inc. 

Dec 14, 2007 02:16 AM #24
Rainmaker
1,142,060
Bryant Tutas
Tutas Towne Realty, Inc and Garden Views Realty, LLC - Winter Garden, FL
Selling Florida one home at a time

Missy, the turning point in our market was the hurricanes. We had 3 direct hits in Aug and Sep of 2004. Most of thise sells in 2004 were hurricane damaged properties. We were swamped with investors from Nov 2005 to about summer of 2006. That was pretty much how long our boom was.

Laurie, How is that chair working out for you? I just started my holiday chair activities today.

Renee, It sounds like you have been very busy. Good job!!

Richard good to see ya. I dread getting calls from sellers that just purchased 12 months ago. I know there is nothing I can do for them.

Lisa, I don't. I'm sure I could get it from the public records but that's waaaay too much like work:)

Marlene, It's so important for folks to list with someone in their area. I don't care how many properties a REALTOR(R) has sold, if they haven't sold in Poinciana they are clueless.

Bob, It is exactly what I do. The problem though is there are so many newer short sales and bank owned properties on the market that anything built before 2000 is very difficult to sell no matter how we price it. My market is a mess.

 

Dec 14, 2007 06:50 AM #25
Rainmaker
275,571
Ken Cook
Content, coding, marketing, host. - Marietta, GA
Content Marketer/Creator
So when you moving up? We need roommates. I'm even thinking about building a YouTube studio in the dart room.
Dec 14, 2007 02:34 PM #26
Rainer
139,950
Jay McGillicuddy
Berkshire Hathaway HomeServices Verani Realty - Exeter, NH
Real Estate Broker

WOW, how times have changed. That is pretty depressing. Hopefully 2008 will be better. We have written 3 contracts this past week and one has fallen through already due to home inspection and the other two we are waiting for the banks (sellers) to respond. At least the fall through will start looking again after the holidays.

 

Dec 22, 2007 07:54 PM #27
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