Florida Real Estate Insiders Weigh in on Future of Local Housing Market
Every year at this time, the South Florida Sun-Sentinel polls real estate industry professionals who are experts in different segments of the local real estate market. They’re asked to predict what the market will do in the coming year.
Here are their responses:
Jeff Kahn, manager consultant of Century 21 Hansen Realty in Fort Lauderdale: “Save any unforeseen catastrophes and assuming the continued low [home loan rates], 2007 should end up being a much better year in real estate than 2006. I certainly don’t foresee any rise in the average sales price; in fact, I think we will see a continued decline for at least the first and probably the second quarter and then maybe a steadying of prices for the remainder of the year.”
David Levin, a real estate industry consultant based in Delray Beach: “People with a vested interest in promoting real estate transactions will use anything they can to claim that now is a good time to buy and/or sell. Despite this, sales volume for 2007 will remain at current levels.
As sellers and home buyers continue their [standoff] prices will erode approximately 5 to 10 percent further. Inventory levels will increase before backing down in the latter part of the year as disenchanted sellers take properties from the market and buyers selectively buy properties that actually meet investment criteria or can be carried by income.”
Frank McKinney, Delray Beach-based developer of ultra-luxury homes: “2007 promises record sales of trophy properties, bucking the trend of the macro real estate market. Ultra high-end properties are defined as having a value in excess of $10 million. These properties represent lifetime achievement awards for those who can afford them, and more will be able to. The ultra-wealthy class of buyer is growing at an alarming rate. By the end of 2007, there will 22 percent added to the rolls of those with a net worth over $50 million.”
Peter S. Mottek, president of First Southern Bank in Boca Raton: “Every major player in real estate finance wants a slice of the pie. Intense competition for relatively few new projects will push loan rates down to artificially low levels. Most of 2007’s action will be in the commercial sector as buyers pick up office and warehouse properties offered by sellers anxious to cash out before rising taxes and insurance costs consume profits.
Don’t look for any upswing in new condominium loans until the current 18- to 20-month inventory of unsold units falls below the 12-month level. Financing for condo conversions will likely be limited to the affordable housing sector.”
Orin Rosenfeld, senior associate, retail services, with CB Richard Ellis in Boca Raton: “The retail market will continue to be strong in 2007. Land and product is scarce, and that will not change unless there is a major shift in the economy. With Florida slated to be the third most populous state in the country by 2011, retail must be created to serve the growing population. Vertical retail has debuted in [the Miami housing market] and that trend will also continue in 2007.”
Andy Weiser, mortgage broker-associate with Coldwell Banker in Fort Lauderdale: “I see our market continuing to improve slowly and steadily. For end-user buyers, this is going to be a great time to buy. Sellers (and their real estate agents) will have to reposition their prices. This is not the time to give your best friend’s kid who just got a license the chance to learn about selling real estate by listing with him or her.”
Mark Zilbert, broker/owner of Zilbert Realty Group in Miami Beach: “The Miami-area residential market will see renewed growth after about 15 months of waning buyer interest. We will see an appreciation of 5 to 7 percent in the luxury [Florida condo market] and a 20 percent increase in the number of real estate transactions. The increase in transactions will be due, in part, to sellers deciding to bring their listing prices down.
We will see a 10 to 30 percent reduction in the listing prices of resale condos in the $500,000 to $900,000 range, but there will be growth, although modest, in condos costing $1 million and up.”