Summary: Historically, the real estate trends of Florida have always been the precursors for the rest of the country. This is why leading players of the real estate market keep a close watch on the Sunshine State’s real estate market conditions.
Keywords: real estate, Florida, Florida real estate, marketing trends, Tampa Bay Real Estate
Historically, the real estate trends of Florida have always been the precursors for the rest of the country. This is why leading players of the real estate market keep a close watch on Sunshines State’s real estate market conditions.
And whether you are a first-time homebuyer, debating the viability of building your dream house in Tampa Bay, or a real estate investor looking to sell condominium units in Miami, you certainly want to know: When is it the optimum time to buy or sell?
Purchasing a house is a major investment. With judicious planning, this valuable asset will appreciate with each year.
But how do you get the big picture? Fortunately, real estate trends are predictable because these develop over a long period, unlike the stock market, which is rather volatile.
The first thing you will need to do is to read and track real estate articles: the market reports of the Florida Association of Realtors or the Florida Building Industry Association, and the briefs created by housing analyst companies.
Once you have identified the following key indicators you will have a better grasp of the general trends in the Florida real estate market.
THE FIVE KEY INDICATORS TO WATCH
When interest rates rise, buyers shy away. Conversely, lowered interest rates attract more buyers.
This year, interest rates in Florida are on an upswing. For example, thirty-year fixed mortgage rates, which averaged 5.71 percent in 2005, has risen to 6 percent levels in January 2006. Adjustable mortgage interest rates have moved up to 5 percent levels compared to 4.12 percent in 2005.
The higher the number of building permits issued, the higher the demand for houses.
Figures show that the number of building permits issued for the year 2006 has fallen by 10 percent in comparison to last year’s figures. In terms of houses, that’s a decrease of 1,430 building permits compared to January 2005 figures, according to the Florida Building Industry Association report.
This key indicator refers to the total number of homes sold. In the law of supply and demand, when there are few buyers, real estate prices fall.
The January 2006 figures of the Florida Association of Realtors revealed that the number of existing single-family detached homes sold has gone down by 24.1 percent in comparison to sales for the entire year 2005.
Another factor to consider is the growing inventory of available houses in certain counties in Florida, which is changing the market dynamics. What was once a seller’s market is slowly turning into a buyer’s market.
This refers to the failure of homeowners to pay their monthly mortgage fees. One downside to this is that many Floridians homeowners are choosing to have a bad credit report, rather than to keep paying fees for a home whose value has been inflated by as much as 20 percent more.
Figures presented by DataQuick Information Systems, a housing analyst company, indicate that foreclosure activities in Florida have gone up by 19 percent in the last quarter of 2005. This is an increase of 3 percent compared to the third quarter of 2005 and is 4.6 percent higher when compared to 2004’s last quarter figures.
When foreclosure sales are on an upswing, consumer spending is down and consumer debt levels have risen. In the real estate market, this has meant that many financially strapped homeowners are selling their homes at lower prices. The other contributable factors are inflation, the rising prices of gasoline, the federal budget deficit, and interest rates.
Concurrently, these key indicators confirm that although home sales levels in Florida are falling, the demand for houses remains strong and steady. Always do your due diligence before undertaking a purchase of property in Florida.