By Louise Bolger
Tracking down the birds of real estate
sun staff writer
The white pelicans are back. The beautiful snowy white larger
version of our native brown pelicans have made their winter
migration to the shores of Anna Maria and Sarasota Bay. The
white pelicans are also accompanied by exotic birds with license
plates from Michigan, Ohio, Illinois and Quebec, who can also
be spotted driving up and down Anna Maria Island and over
the bridges. But what about those other exotic birds, the
ones who come to permanently roost in our condos and our waterfront
homes, the ones who have driven up the value of our properties
during the past five years, the ones we have come to depend
upon - the buyer birds - has anybody seen them yet?
The National Association of Realtors reported that total existing
home sales, including single family and condo, were down 12.7
percent from the third quarter of 2005 compared to the third
quarter of 2006. Further, they report this is the first time
since 1993 that quarterly home prices took a downturn. Not
surprising to anyone on Anna Maria with a property for sale,
the declines were the largest in the once-booming areas of
the country, including Florida, which fell 34.2 percent. Nevada,
Arizona and California were all approximately in the same
rate of decline as Florida.
David Lereah, the National Association of Realtor's chief
economist, has put somewhat of a positive spin on otherwise
depressing numbers by predicting that the downtrend will continue
in the months ahead, but predicts modest appreciation in 2007.
I sure hope you're right, David, but more likely 2007 will
be loaded with uncertainty and probably won't be a standout
year in the housing market.
Some of the experts in the field, including the Urban Land
Institute's study of emerging 2007 real estate trends, are
hopeful that the economy has built up enough momentum to pull
the housing market along until the next upturn. The change
in the market will be a sideways or slowly slipping downward
trend instead of an abrupt drop. Hardest hit will be recent
buyers who need to sell without waiting out the downturn and
speculators who got in the game too late.
Existing homeowners who have years of equity gains will fare
well even in a declining market as long as they haven't borrowed
too much of their paper equity for other big ticket items,
or engaged in creative financing. Also in for a rude awakening
are new or potential retirees who were depending on their
home's value to fund their retirement. They may have to recalculate
their net worth in view of softening home prices.
Unfortunately for us, the second home market has inevitably
slowed to a crawl. There are a lot of likely vacation property
and second home buyers sitting on the fence waiting for what
they perceive as the absolute bottom of the market where they
can negotiate from a position of power.
With the market in full transition, if you were planning on
spotting the buyer birds, this may not be the year you're
successful. They may be a rare breed now, but they can't stay
away forever; eventually they'll want to fly south for the
winter and we still have what they're looking for.
Wishing everyone a happy and peaceful holiday season.