Northwest Sellers Must Lower Prices to Attract Florida Mortgage Seekers

We hear it every day. The Northwest Florida housing market is stabilizing, returning to normal, slowing to a more reasonable pace.

But what does that really mean? Especially for folks whose “For Sale” signs have started to grow moss? Or the newlyweds hoping to find a deal?

It means, says mortgage broker Richard Bell of Beach Bell Realty, that your price had better be right and your patience intact.

“If I’ve got $400,000 to spend on a house along the Emerald Coast, I’ve got so many choices,” Bell said. “It’s all about price.”

According to data from the Emerald Coast Association of Realtors, in the fourth quarter of 2006 it would have taken 19.3 months to sell the entire single-family home inventory in the area. It would have taken 54 months to sell all of the condos on the market.

“If you want to sell your house, you have to lower your price,” said Bell, who is based in Atlanta and has experience selling real estate in Northwest Florida. “Everybody’s got the bells and whistles, but price is that underlying equalizer.”

Early results from the first quarter of 2007 back up his claim.

“We’re seeing a lot of activity on houses that are priced right,” said Ray DiTirro, a Realtor with RE/MAX Southern Realty.

In the fourth quarter of 2006, the average list price for single-family homes was $413,302, and the average sale price was $385,973. So far in 2007, the average list price for single-family homes is $370,594 and the average sale price is $342,064.

When it comes to condos, the market is equally, if not more, crowded, Bell said.

“There’s a huge amount of condos out there,” he said. “We’re overbuilt, there’s no question about that. We’re waiting for the blood to flow.”

Many condominiums are finally receiving their certificates of occupancy, but Realtors are uncertain about Florida mortgage applicants showing up to close the deal.

“There are a lot of people who are just walking away,” DiTirro said. “They do their cash-flow analysis and they say, ‘It’ll cost me less to walk away than to carry this condo.’ ”

Some long-time developers say they’re not alarmed and that the market is simply moving from one cycle to the next.

“The market couldn’t sustain the pace it was running at,” said Lowell Larson, chief executive officer and president of Southern Ventures Corp. “I’ve seen it before. I think if you’re going to be invested in real estate, you have to take the long view.”

Larson’s latest project is Terceira condominiums at the foot of the Shalimar Bridge. He is in the process of pre-sales.

“The market is slower than what we’d like right now, but we feel like it’s going to come back,” he said. “I think the Panhandle of Florida is going to continue to have growth.”

DiTirro agrees, pointing out that many factors will shape home purchase loan market activity in 2007.

“We’re normalizing,” said DiTirro, predicting that the year ahead would likely be one of correction. “It’s going to depend on what happens with our storm season and the insurance issue and this new sales tax proposal.”

Meanwhile, the slow-down is taking a toll on both first-time home buyers and sellers. DiTirro reminds his customers to keep an eye on the big picture.

“You show them the statistics. You show them the graphs,” he said. “The market doesn’t have a heart. It is what it is.”

SOURCE: The Northwest Florida Daily News