Home sales keep sliding
Nationally and in the Tampa Bay area, no end is in sight.
By Times Wires
Published September 26, 2007
The Tampa Bay area ended the summer home-buying season with another report of falling sales and weaker prices.
Thanks in part to tougher mortgage standards and a historic real estate glut, the region's single family home sales fell 29 percent year in August.
Home sales in Pinellas, Pasco, Hillsborough and Hernando counties totaled 2,154 last month, vs. 3,029 in August 2006. The sales numbers approximated pre-housing boom totals from August 1995.
Median prices fell 8 percent year over year, from $232,400 in August 2006 to $214,100 in August 2007.
Nationally, sales of existing homes fell for a sixth straight month in August, pushing activity to the lowest point in five years. The National Association of Realtors said sales of existing single-family homes dropped by 4.3 percent from July to August. Sales at a seasonally adjusted annual rate dropped to 5.5-million units, the slowest pace since August 2002.
"The unusual disruptions in the mortgage market, including a significant rise in jumbo loan rates, resulted in a fairly high number of postponed or canceled sales, with many buyers having to search for other financing when loan commitments fell through," said Lawrence Yun, senior economist for the National Association of Realtors.
"Once we get through these disruptions, we'll get a better sense of where the actual market is in late fall as conditions begin to normalize," Yun said.
The state numbers were released by the Florida Association of Realtors on Tuesday, a day when yet another report flagged Tampa as the second worst among 20 metro areas in home price drops.
The S&P/Case-Shiller home price index said prices have fallen by the steepest percentage since the housing recession in 1991. It also shows Tampa Bay prices returning to September 2005 levels.
Five cities on the index still showed rising prices: Atlanta, Charlotte, N.C., Dallas, Portland, Ore., and Seattle. But all have reported slowing growth the past year, S&P said.
The housing market has been battered by the steepest downturn in 16 years. Those problems were exacerbated in August by turmoil in credit markets, reflecting new worries about rising mortgage defaults.
The national median price of an existing home - the point where half sold for more and half for less - edged up slightly in August to $224,500, an increase of 0.2 percent from August 2006. It marked the first year-over-year price increase after a record 12 straight months of declines.
Many analysts believe that sales and prices will fall further as the housing market suffers from more foreclosures that dump more homes on an already glutted market and cause lenders to tighten standards.
The inventory of unsold homes reached a record 4.58-million in August. That means it would take 10 months to exhaust the inventory of homes at the August sales pace. Inventory is worse in the Tampa Bay area, where about 41,000 homes are listed for sale. It would take about 19 months, to exhaust that supply. A 6 to 8 month supply generally represents a balanced market.
Many economists predict the market won't reach a health balance of supply and demand until mid 2008 at the earliest.
FAST FACTS
Record loss
Tough times in the housing market led to a company record loss of $513.9-million for Miami-based Lennar Corp. in the third quarter, with drops in sales prices and home deliveries compounded by heavy charges to write down land values. Losses for the quarter ended Aug. 31 amounted to $3.25 per share, compared with a profit of $206.7-million, or $1.30 per share, in the 2006 period.
2,154 Existing home sales in Pinellas, Pasco, Hillsborough and Hernando counties last month.
3,029 Existing home sales in Pinellas, Pasco, Hillsborough and Hernando counties in August 2006.
$214,100 Median price last month.
$232,400 Median price in August 2006.
Source: Florida Association of Realtors