Florida: home price spike likely to continue

By DICK HOGAN • dhogan@news-press.com • October 26, 2010

September’s home sales dipped while prices spiked up in Lee County – but more recent chaos in the foreclosure process could make those patterns seem mild.

The median price of an existing home sold in Lee County in September was $94,400, compared to $88,400 in August; the number of sales fell from 1,193 to 1,102 for homes sold with the assistance of a Realtor, according to a report released Monday by Florida Realtors (formerly Florida Association of Realtors).

But in early October, some of the nation’s largest banks abruptly yanked some houses off the market that they’d taken back in foreclosure – citing potential irregularities in the way the paperwork had been handled.

In Lee County and around the country, the announcement by Bank of America, JPMorgan Chase and others caused fears that flawed foreclosure documents could keep buyers on the sidelines in the final months of the year.

A trend of fewer sales and higher prices likely will continue, although the extent on final sales won’t be known until next month, said Steve Koffman, a real estate broker with Century 21 Sunbelt in Cape Coral.

“It’s kind of a false sense of security when you see the median go up,” Koffman said.

The trend likely will mainly reflect that most of the houses pulled off the market were the most inexpensive ones for sale. With much of the bottom of the market gone, Koffman said, the median price will likely rise further by default.

A smaller inventory of houses for sale likely will mean fewer sales, he said, although that’s not certain – investors could simply switch to higher-end homes.

But it’s not clear how strong that effect will be, said Brett Ellis, head of The Ellis Team with Re/Max Realty Group in Fort Myers.

For one thing, he said, some banks continued filing foreclosures and getting judgments in existing cases, although there were some delays.

“I never saw a pause whatsoever,” Ellis said.

The Naples Area Board of Realtors does not make its sales and prices public.
Nationally, sales grew 10 percent in September to a seasonally adjusted annual rate of 4.53 million, the National Association of Realtors said Monday.

Still, sales could fall further if potential lawsuits from former homeowners claiming that banks made errors when seizing their homes make consumers fearful of buying foreclosed properties.
In a survey taken by the association this month, about 23 percent of the 2,000 agents surveyed said they have a client who is no longer interested in purchasing a foreclosed property due to the foreclosure-document mess.

“You’re going to see uncertainty on the part of homebuyers,” said Quinn Eddins, director of research at Radar Logic Inc., which tracks the housing market.

Mortgage applications to purchase homes last week were 29 percent below the same week a year ago, according to the Mortgage Bankers Association. At that time, buyers were rushing to purchase homes to qualify for federal tax credits.

Florida Property Bottoming out?

Distress sales boost existing-home prices.
By Mary Shanklin, Orlando Sentinel.

Orlando’s existing home prices climbed more than 5 percent in September, rising to $105,000 from $99,900 in August, according to a new report from the Orlando Regional Realtor Association.

The price increase, up from a 12-year low during August, was driven by a 10-percent price hike for short-sales prices and a 3-percent boost in prices of bank-owned houses. Those sales represented more than 70 percent of the market activity in September. Prices for “normal” sales – houses that aren’t sold in distress – were down 5 percent from August.

Members of the association completed sales on 2,226 homes in September, which is 13 percent decline from August and a 3 percent decrease from September 2009.

“What we are seeing is that a huge backlog of pending sales have finally worked through the system,” said Re/Max Town & Country agent Kathleen Gallagher McIver, chairman of the association. “Going forward, I now expect both the completed sales and pending sales columns to be lower compared to the previous year.”

The association noted that, to date, home sales are up 32 percent over this time in 2009.

There are currently 16,359 homes listed for sales on the area’s multiple-list service. The September inventory level is 2 percent higher than it was in September 2009, when 15,967 houses were listed for sale. The current pace of sales translates into 7.4 months of supply; September 2009 recorded 7-month supply.

Homes spent an average 88 days on the market before coming under contract in September 2010. In September 2009, houses were on the market an average of 96 days. The area’s average interest rate decreased in September to 4.46 percent.
Throughout the four-county metropolitan area, September sales volume exceeded the pace from a year earlier:

•Lake: 9.6 percent above 2009, with 3,224 homes selling to date this year

•Orange: 27.5 percent above 2009, with 14,629 homes selling to date this year.

•Osceola: 17.6 percent above 2009, with 4,813 homes selling to date this year.

•Seminole: 41 percent above 2009, with 4,396 selling to date this year.

Detroit House Prices Are Rising

Is Detroit To Be The Fastest Recovering Economy Ever Seen?

The City of Detroit has been one of the worst economic cities hit by the recent recession in the United States. Back in the early years when the big three auto makers made Detroit one of the wealthiest cities to live in and work. Now house prices are rising again – is Detroit to be the fastest recovering economy ever seen? It certainly looks that way.

The City of Detroit is the largest city in the great State of Michigan. It is home to the auto giants Ford, Chrysler, and General Motors. It employs tens of thousands of people, and at its prime, was a very vibrant and proud city with low crime and enviable growth.

The tide changed over the years. With the automotive industry in the United States becoming more and more weak in the global economy, Detroit was now poised to be a lesser city that it used to be. Jobs became more and more scarce for a city that mostly knew how to produce the best cars and trucks the world has ever seen. Home prices have fallen to record lows.

Competition became more and more stiff. Japan was building cars and trucks that were being bought the world over due to their quality and better fuel economy. In addition, their prices were good and that attracted more and more customers away from buying American. Automotive loyalties changed.

Crime in the city rose, and with the loss of jobs, many families moved from the city limits to the surrounding suburbs. This left the city with abandoned homes and businesses. Detroit was feeling the pressure.

Schools were in decline and the graduation rates for students was dropping. It was hard for the city to rebuild its image, and its economy. And what was worse, was the obvious decline of the motor industry that was felt throughout the world. It seemed that Detroit’s automotive hold and place in the world was over for good.

Now, with the help of the US taxpayer and the new Obama Administration, all big three automakers are back making money, and they are making it back quickly with Ford and GM releasing reports of bumper profits for the past 2 years. Newer cars and trucks with better quality and much better fuel economy is drawing back customers and new jobs are being created. A brand new Ford plant in Detroit to build the first production electric car is already under way – ‘Motor city’ has pledged it’s eligance to Detroit.

Detroit is embarking on a new image with movie studios, a direction they have never been in before. Detroit is making a huge comeback. Now, Detroit house prices are rising – is Detroit to be the fastest recovering economy ever seen. The future looks bright.

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