As inventory falls, agents' hopes rise

Tag : Stabilizing Agent

"We're back in the saddle again," said Wood, a Venice-area agentfor Coldwell Banker Residential Real Estate. "The baby boomers areback and they are coming from everywhere and they don't discusstaxes or insurance -- that's not even in their vocabulary."
So far, her June sales figures are already up over the total forJune 2007, and her sales last month increased five-fold whencompared with May 2007, she said.
The right site is driving the movement, followed closely by theright price.
Wood's story is one echoed by real estate agents around the region.
Leading the pack is Sarasota County, where the months of inventoryfor homes under $1 million have been roughly halved from Januarythrough May, reports Sacramento, Calif.-based real estate markettrend analyst Trendgraphix Inc. The inventory represents the numberof months it would take to sell all the houses on the market.
The company's data is not perfect because it bases its findings onthe region's various Multiple Listing Service reports, which oftenoverlap and have other statistical anomalies. Also, not all thehomes that are no longer on the market were sold. Some were pulledby frustrated sellers who could not find a buyer at the price thatthe sellers wanted.
But the data does offer a snapshot of the housing market that iswelcome to weary sellers and agents who have been struggling sincethe housing bubble burst in mid-2005.
"We are back to '05 and '06 numbers," Wood said. "The business hasabsolutely turned around."
6 months, 164 houses
Charlette and Bill Armstrong are among those who have contributedto the decline in the inventory.
After taking a loss on their California home when Bill Armstrongcame here in December to be a regional vice president forBradenton-based Champs Sports, the couple were leery about buying anew house because they did not want to get burned twice.
"We just looked and looked and looked," Charlette Armstrong said.The Armstrongs finally found what they were looking for six monthsand 164 houses later.
"Finding the right house was a lot of it," Charlette Armstrongsaid. "But a lot of it was we saw prices continue to decrease. Wewaited until we couldn't wait any longer and then pulled thetrigger."
That was in April, when their purchase of a $500,000 home inManatee County contributed to a 5 percent increase in sales for theSarasota-Bradenton market. During April, sales rose 6 percent inthe Charlotte County-North Port market when compared with the samemonth a year ago.
Realtors are saying that the May numbers, scheduled to be releasedon June 26, will show gains -- although not as impressive as thosefor April in Fort Myers-Cape Coral, a market very similar to thisregion that saw homes move at a pace 41 percent higher than in2007.
The phenomenon was driven largely by a flood of foreclosed-uponhomes that banks were seeking to get off their books.
Home prices in April dropped significantly in every market in thestate except Fort Walton Beach, where they rose a modest 1 percent.
To many, the April drops were further evidence that sellers arecutting prices significantly, and the numbers showed the impact offoreclosures.
In Sarasota-Bradenton, April's median home price fell $34,000 to$268,200 when compared with the same month last year. In CharlotteCounty-North Port, prices fell $53,700 to $143,400 during that sametime.
But Sarasota-Bradenton's price was 12 percent higher than March --and there have been other such indications of some bottoming inrecent months.
The numbers
The inventory drop comes at a time when real estate agents and homesellers and buyers are trying to determine if the region hasreached a bottom, which leads to the billion-dollar question: Isrecovery on the way, or do prices still have further to fall?
In Sarasota County, the months of inventory for single-family homespriced under $500,000 dropped from 28 in January to 14.6 in May, ornearly 48 percent. It was more pronounced for homes priced from$500,000 to $999,999: 42.3 months to 18.2, or nearly 57 percent.
Six months of inventory is considered a normal market.
Kathy Roberts, chief executive of the Sarasota Association ofRealtors, credits the decreasing inventory to three factors: morehouses are being sold at lower prices, fewer are being listed andsome sellers have taken their homes off the market, thinking theoffers they have received are too low.
Peter Crowley, president of Sarasota's Re/Max Alliance Group, saidsavvy investors are moving in and buying both foreclosed andnonforeclosed properties. He agrees that price has been key.
"Realistic pricing is the dominant factor," Crowley said. "Peoplewho really want to sell their homes are realizing prices need tocome down."
Crowley expects small ups and small downs during the summer months,activity that is indicative of bumping along the bottom before slowbut steady improvement.
"We entered this much sooner than other markets in the country," hesaid. "And we're seeing signs of the improvement before other partsof the country."
'Money in the pipeline'
Sales in his territory have been generally rising since December,says Bill Dryburgh, president of the Punta Gorda-PortCharlotte-North Port Association of Realtors.
"It won't go back to '04 and '05 numbers, but every month we aregoing up, and I'm a happy camper," Dryburgh said. "There's money inthe pipeline and, in the inventory out there, there are some reallygreat bargains." He was recently showing a three-bedroom, two-bathhome with a pool that was listed under $100,000.
"It doesn't get any better than that," he said.
For homes priced under $500,000 in the Charlotte County area,inventories have fallen from 32.4 months in January to 14.4 monthsin May, or about 56 percent. For homes from $500,000 to $999,999,the drop was 62.4 months to 50.6, or about 19 percent, Trendgraphixreports.
Dryburgh acknowledges that sellers have been pulling homes off themarket. He and other members of his association have beenpressuring sellers with unrealistic price expectations to get outof the way.
"They are out there fishing for a larger figure but the homes arenot priced realistically," Dryburgh said.
Different in Manatee
Things are slower in Manatee County, though it, too, is seeing thenumber of homes declining. Properties under $500,000 saw aninventory drop comparable to Sarasota County, but pricier homesdropped by a smaller amount.
Still, there are other good signs, said Barry Grooms,president-elect of the Manatee Association of Realtors and a brokerwith Re/Max Alliance in Bradenton.
"We are starting to see properties with multiple offers and wehaven't seen that in three years," Grooms said. "Confidence hasbeen restored a little bit and consumers are realizing the pricesare pretty good."
Grooms thinks that the market is at or near its bottom, helped inpart by foreclosures.
"While foreclosures are bad, they are a necessary evil for themarket to purge the inventory," he said. "We're seeing firefightersand teachers and young professionals who can now buy in ManateeCounty, which is awesome."
Some Re/Max agents who specialize in selling foreclosures arehaving their best months in years, and there is pent-up demandamongst baby boomers and even locals that is beginning to show nowthat prices have fallen, Grooms said.
For homes priced under $500,000 in Manatee, inventories have fallenfrom 22.1 months in January to 16.6 months in May, or about 25percent. For homes priced from $500,000 to $999,999, inventoriesdropped from 68.5 months to 41.2, or about 40 percent.
Stan Rutstein, an agent with Re/Max Gulfstream in Bradenton, thinksthat Florida's historical strengths will win out once the post-boomdoldrums pass.
"Even with all the taxes and the insurance and the hurricanes,people still want to come here," he said.
Some Realtors already have done more business in 2008 than all oflast year, says Sue Louis Wolverton, Coldwell Banker ResidentialReal Estate's senior vice president for Sarasota Bay, and inventorywill be key to the turnaround.
"We have to see the inventory get depleted until we see theproperties increase in price again," Wolverton said. "But I thinkit's really close."


Last modified: June 20, 2008 4:55am