The Anna Maria Island Sun Newspaper

Vol. 9 No. 4 - October 15, 2008

REAL ESTATE

A bailout plan for the ages

Did you hear that? Did you hear the crash? Listen again. It’s subtle, but I know I heard something. It may be my imagination, but I think I heard the housing market hit the bottom last week. Hold on. Don’t start dipping into what’s left of your kids college funds or your 401(k) and scoop up five condos. If economists are correct, the bottom will be around for quite a while.

You don’t have to be a graduate of Wharton Business School to know that the United States economy is in a mess. The government bailout plan approved by the Senate and Congress is designed to bring a sense of stability to the financial markets and restore confidence. Since consumer confidence is an essential ingredient for the housing market to recover, stabilizing banks and other financial institutions should go a long way to settle down potential buyers.

The bailout plan will also assist hundreds of thousands of financially-distressed homeowners from falling into foreclosure. With the government taking over mortgage portfolios foreclosure actions will be at least temporarily halted, providing work out terms for many homeowners. In addition, there is $541 million in grant money coming to the state of Florida – over $5 million earmarked for Manatee County. These funds are designed to help counties maintain abandoned homes in an effort to keep up property values in distressed neighborhoods as well as assisting low and middle income home buyers. And Countrywide Financial, which is now owned by Bank of America, will compensate Florida homeowners who may have been victims of predatory lending practices. At least 600 Manatee County homeowners could have their principal and interest rates reduced avoiding possible foreclosure.

However, the most recent positive news came from the Federal Reserve last Wednesday when the Federal Reserve chairman announced an overnight interest rate cut of 1/2 percent. Since our economy is tied to the economies of many countries around the world, it was not surprising when the central banks in Canada, England, Sweden, Switzerland and the European Central Bank also reduced their prime lending rates. The purpose of this quick and unprecedented action on the part of our Federal Reserve, as well as other central banks, was to stave off an economic slump, which has become toxic to all businesses in the ever-expanding "flat" world. The rate cut will lower interest rates for companies who that to expand, as well as a variety of consumer credit options, including bank credit cards and auto loans.

So, why do I think all of the above radical measures could result in the beginning of the real estate bottom,? Here’s a few key points: Greater consumer confidence in the financial marketplace, modest interest rates, very attractive prices, property foreclosures peaking because of government assistance, fewer new homes being built reducing available inventories, an expanding population and perhaps most important, gold plated qualified buyers entering the marketplace. All of this could be enough to kick the whole cycle into gear and get housing moving again.

If you’re a buyer your head is probably getting ready to explode trying to determine the right time to buy. If you’re a seller, you need to prepare with a great product or a great price to set your property apart from the competition. Either way in six months we’ll know the story, so keep your ears tuned in because the next sound you hear may be the market starting to rev up.

Real Estate Transactions
Closed sales between June 16 to July 11, 2008

Anna Maria

217 Pine Ave.     Mixed use      $750,000
413 Poinsettia Rd.      Single family      550,000
308 Pine Ave.      Single family      525,000
161 Crescent Dr.      Single family      390,000
215 Palm Ave.      Single family      380,000
407 S. Bay Blvd.     Single family      359,500

Bradenton Beach

200 Gulf Dr. S. #3      Condo     $750,000
205 Church Ave.      Single family      539,000
1105 Gulf Dr. S. #3      Condo      350,000
1801 Gulf Dr. N. #104     Condo      186,500
117 Seventh St. N. #20     Condo      150,000
2601 Gulf Dr. N. #303     Mobile      83,400
117 7th St. N. #16     Condo      60,000

Cortez

4003 129th St. W. #102      Condo     $495,000
4104 128th St. W. #702      Condo      345,000

Holmes Beach

524 67th St.      Single family     $700,000
623 Foxworth Ln.      Single family      632,000
222 82nd St.      Condo      575,000
213 67th St. #B      Condo      510,000
229 South Harbor Dr.      Single family      485,000
668 Key Royale Dr.      Single family      475,000
203 71st St.      Duplex      475,000
204 71st St.      Single family      442,000
3400 Sixth Ave. #5      Condo      305,000
3701 Fifth Ave. #1      Condo      299,900
3601 East Bay Dr. #10     Condo      245,000

Source: Manatee County Property Appraiser’s Office.


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