July brings bad news for sellers, particularly in the Tampa Bay area where bidding battles are just a fond memory for homeowners.
By HELEN HUNTLEY, Times Personal Finance Editor
Published August 24, 2006
Home sales fell across the country last month, but in Florida they took a dramatic nosedive, according to numbers released by state and national Realtors' groups Wednesday.
Sales of existing single family homes fell 5 percent nationally, 33 percent statewide and 45 percent in the Tampa Bay area in July compared with the same month a year ago. Sales of existing condominiums rose 3 percent nationally, fell 37 percent statewide and plunged 52 percent in the Tampa Bay area.
Not surprisingly, the statistics show that sellers have lost the pricing power they had last year when buyers were trying to outbid each other and prices were rising every month.
"There were a lot of speculators in the market and when you take them out, the difference is pretty dramatic," said Bradford Monroe, president of the Greater Tampa Association of Realtors. "Our inventory is four times what it was back then and the number of sales has gone down.
The median sale price for a single-family home was about the same in July as it was a year ago - $237,000 in the Tampa Bay area and $250,800 statewide, but both numbers are down from June.
David Lereah, chief economist for the National Association of Realtors said it's likely to be months before prices begin to appreciate again. Nationally, the inventory of unsold homes is at a record 3.9-million.
Buyers clearly have lost their sense of urgency.
"Before they were afraid to wait because if they did, prices would go higher," said Carolyn Kling, president-elect of the Pinellas Suncoast Association of Realtors. "Now they're sitting back, waiting to see what happens."
Those looking for huge bargains don't appear to be finding them, but some sellers are pricing properties more aggressively. Monroe said he's seeing wider disparities in listing prices for similar properties.
"If your house was worth $300,000 last year and there are 20 homes on the block priced at $300,000, if you want to sell yours, to stand out, you list it at $295,000 or $290,000," he said.
Monroe said those who bought several years ago at lower prices can afford that kind of price cut, while someone who paid $310,000 cannot.
Many investors who bought condos are opting to rent them out rather than sell for less, said Kling, who has a property management business, Island Resorts Realty, in addition to a real estate sales company. "Our rentals are increasing tremendously," she said.
But she said some sellers are still thinking unrealistically.
"We still have some properties out there that are priced at last year's wishful thinking," she said.
One statistic that dramatically illustrates the change in market climate is the absorption rate - sales divided by listings - a statistic that Pinellas Realtors compile. In the single-family market, the monthly absorption rate has fallen from a peak of 59 percent in June 2005 to 9 percent last month. In the condo market, the rate peaked at 62 percent in April 2005 and fell to 5 percent last month.
Outside the Tampa Bay area, single-family sales are down most dramatically in southwest Florida. The strongest market in the state last month was Ocala, with sales down just 1 percent and prices up 20 percent. One reason may be that Ocala's median sale price of $147,400 is the lowest of the state's metro areas.
Condo sales were down in most parts of the state, with Gainesville, Orlando and Tallahassee notable exceptions.
