Vol 7 No. 23 - February 28, 2007

We live in interesting real estate times

By Louise Bolger
sun staff writer

During a short period of time in mid-February, some very interesting things happened related to the real estate market. If you read the newspapers and follow local real estate trends and events, you may have noticed some of what I’m about to tell you. If not, pay attention because in my opinion it’s all interrelated and may predict the future of the market.

On Feb. 15 the fourth quarter national home sale statistics were released by the National Association of Realtors, and the numbers were dismal. In the 27-year history of the National Association of Realtors’ survey this was the largest percentage of price declines.

Nationally, sales declined by 10.1 percent in the fourth quarter of 2006 compared with the same period the previous year, however, the median sale price only fell 2.7 percent. The biggest sales declines were in Nevada, Florida, Arizona and California with Florida coming in second at about 28 percent. The median sale price decline for Sarasota/Bradenton was 18 percent, with the unfortunate distinction of being the leading price decline in the country.

The very next day, the federal government reported that housing construction in the country is at a 10-year low. And the Bradenton Herald reported that in Manatee County the number of building permits issued for single family residences declined 44.7percent from January 2006 to January 2007.

Are we depressed yet? Don’t be. In my never ending desire to place a positive spin on anything to do with real estate, I also found a couple of bright spots.

On Saturday, Feb. 17, there were two absolute auctions in Bradenton Beach. I attended one of them and came away feeling that all is not lost, not even close. The auction took place at a Gulffront condo unit in the Bradenton Beach Club at 1702 Gulf Drive, a 3 bedroom, 2 bath fully furnished with a good rental history directly on the beach. Since this was an absolute auction, there was no minimum or upset price. About 75 people were in attendance and access to the unit being auctioned was available for inspection. According to the Manatee County Property Appraiser’s Web site, this unit was sold in November 2003 for $750,000.

The opening bid was $500,000. The bidding went up rapidly from that point in $50,000 and $100,000 increments until the price reached $850,000. Two buyers were bidding against each other, and they moved from $875,000 to $885,000 to the final bid of $895,000. I never expected it to sell that high, despite the fact that the unit next door, which is smaller listed for $895,000 with a local broker.

Then on Feb. 20, as if I needed to be even more encouraged about the real estate market, in a newspaper article regarding the Taxation and Budget Reform Commission, I was reminded of Governor Christ’s proposed plan:

An increase in the homestead property exemption to $50,000, portability of homestead exemptions from one property to the next and making second home and commercial property owners eligible for the 3 percent cap enjoyed by homesteaded residential property owners. If all three of these proposals are voted in by 60 percent of voters, you’ll see the real estate market get a kick start like you won’t believe.

You need to take a little bad with the good in life, and I’m going with the impending good. But, if you can’t wait for Florida to turn around you can always move to Atlantic City, New Jersey where the median home price was up almost 30 percent in the fourth quarter. Too much of a gamble for me.

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