Pending Home Sales Rise in First Quarter

By
Real Estate Agent with Gulf Coast Realty Network, Inc.

Despite conflicting information from two data sources, it is clear that home sales in Lee County Florida have increased during First Quarter 2008.  Home SALES show a small decrease Year-to-Year, reflecting somewhat diminished purchasing activity in Q4 of 2007.  PENDING sales show a 17% increase Year-to-Year and confirm what many Realtors are saying......buyers are beginning to "pull the trigger".  Inventory levels of lower priced homes have fallen ( on a months basis) as Pendings rise.  Obvious reasons include Compelling Prices and Pent-Up Demand.

Many bank-owned properties were priced too high in 2007.  Not being known for aggressiveness, banks were always just a bit behind the pricing curve in 2007.  Some of them, at least, seem to have figured that out and have gotten their pricing about 5% to 10% ahead of falling prices.  Also, Real Estate Auctions in Lee County have become predictive of future pricing.  Result?  The $100,000 floor that seemed to exist in Cape Coral Real Estate during 2007, seems to have been re-established as an $80,000 floor.  The $90/sq ft floor for good houses is now a $75.00/sq ft floor.  That 20% write-down was apparently enough to bring out first-time homebuyers, schoolteachers, policemen and other who just couldn't make it work previously.  It also seems to have triggered a wave of vulture buyers who are betting that they can rent out the properties for three to five years and cash in on property price increases.

SouthWest Florida hs not changed, in fact, our weather for the last two years has been the best in twenty years.  And, yes Alice, the yellow brick road does lead to places with good weather.  SW Florida still has the year-round golfing, boating, fishing, beaching, sittin' on the verandah with a refreshment, and all the other things that are so much fun for retirement and spring break and holidays and (shhhh!) work.   Baby Boomers are not getting YOUNGER.  At some point they either have to make the decision to go to Florida or stay "up North".  Eventually, they will visit SW Florida, see the compelling market prices and STAY!  We have been through many cycles (albeit less severe) of this length before and they always end.   Most recently, homes purchased in 1989 did not recover their purchase price until about 1997-1999.  BUT WHEN THEY DID.......!!!!  I know, I was one of those homeowners who bought in in 1989, only to see my home's value stagnate for 10 years.  When I sold it in 2000, I tripled my money and then some.  Not bad for a ten year return - tax free.

So here we are again.  At the bottom. 
Five Years away from a payoff for today's investment. 
Guaranteed?    No.
Historically Probable?   Absolutely.

Why do you think all these "Vulture Funds" are being formed?  It's no different from a situation where you and a few friends pool some funds and buy a home.  Share it, rent it, do whatever, then SELL IT five years from now.  Vulture funds are just a larger group of investors who share the same vision.

Smile on your Real Estate.... 
JimG

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Rainmaker
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Anthony Stokes-Pereira
Better Homes and Gardens Rand Realty - Nanuet, NY
Realtor

Hi Jim;

I hope that is good news for you and Realtors in your area.

Apr 13, 2008 06:41 AM #1
Rainer
51,183
Christopher Bonta
The Bean Group - Londonderry, NH
Realtor, Integrity and Honesty
Hopefully your good news will start spreading, especially since Florida was among the hardest hit areas for Real Estate.
Apr 13, 2008 07:15 AM #2
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Kate Elim
Dockside Realty - Spotsylvania, VA
Realtor 540-226-1964, Selling Homes & Land a

Hi Jim...We're exeriencing some increased activity also.  Hopefully it will continue (and increase!).

Kathleen

Apr 13, 2008 04:37 PM #3
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Rainer
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Cape Coral Florida Golf Course and Waterfront Homes

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