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Letter to the editor

Home prices show big drop

The November numbers mark the worst year-to-year price decline in at least a decade.

By JAMES THORNER, Times Staff Writer
Published December 15, 2007

According to several national housing experts, when the Tampa Bay area's topsy-turvy housing market finally rights itself, our homes will be worth about 25 percent less.

November's home sales price declines could be a pretty good down payment on that prediction.

The median sales price of single family homes in Pinellas County dropped 14 percent year over year. Prices fell to $185,000 in November from the $215,000 recorded a year earlier.

Pasco County came out even worse, showing an 18 percent median home price decline, to $170,000 last month from $208,000 in November 2006.

It was the worst year-to-year home price drop in at least a decade, though statistics don't go back far enough to prove whether it rivals declines in earlier housing slumps.

The Greater Tampa Association of Realtors keeps tabs on its home prices differently, using average prices instead of median prices. But even the Tampa group showed a 5 percent price decline over the past year.

Old neighborhoods, new suburbs, waterfront condominiums: Everyone's been suffering from poor sales linked partly to banks wary of lending to less-than-stellar borrowers.

"Every neighborhood's stressed. There are no exceptions," said St. Petersburg Realtor Bunni Longwell of ERA Compass Real Estate.

Price declines have tracked sales declines in the same markets. Pinellas sales were off 22.6 percent over the year, to 657 last month from 849 in November 2006. Pasco and Hillsborough home sales plunged by about a third in the same period.

The Pinellas Realtor Organization, which released the home-sales figures, took a glass-half-empty-glass-half-full approach to the news. Stay put in your home and you'll come out well in the end, said Ann Guiberson, the group's president.

"While the downturn in median sales price is certain to have affected investors intending to flip properties, home owners who have held their homes for several years have gained significantly from an overall appreciation," Guiberson said in a statement.

"More importantly, there's no question that home prices in this area are becoming more affordable, creating great opportunities for buyers."

At the heart of the price drop is the massive inventory of homes on the market. More than 40,000 houses and condos clog the listings in Pinellas, Pasco and Hillsborough. Investors get most of the blame. They over-stimulated new home construction through 2006 and dumped the surplus onto the market.

Pasco's condo scene illustrates the dilemma: Two years ago 43 of 153 condos on the market sold in November. This November's sales were nearly the same - 41 - but listings had ballooned to 1,301.

At this year's sales pace, Pasco would need 32 months to sell off its condos. Realtors consider seven to 10 months a healthy supply. It's the same story in Pinellas and Hillsborough.

Home prices drop
The sales price of single-family homes fell considerably from November 2006 to November 2007 in Pasco, Hillsborough and Pinellas counties.

Hillsborough average price
November 2006: $262,000
November 2007: $250,000
Change: -5 percent

Source: Greater Tampa Association of Realtors and Pinellas Realtor Organization

James Thorner can be reached at thorner@sptimes.com or (813) 226-3313.

[Last modified December 14, 2007, 23:15:46]