Area Foreclosures

[Miss Critter]

Let me jump in here since I don't have a reputation at risk:funn:It looks pretty simple to me. While it may not be the absolute bottom, I feel comfortable saying that a safe buy point will be the inflation adjusted pre bubble price for homes/land. By my calculation that would be approximately $ 185 per sq. ft. based on the area wide averages that Josh publishes. I think the current number is somewhere just above $200 per sq. ft. I suggest that if there is exogenous legislation that provides huge incentives i.e. $20k TAX CREDIT for home purchases, present value calculations can be made and added on a sq. ft basis to adjust.

Okay, who are you and what have you done with the real CC??

 

[Miss Critter]

It will be interesting to watch the market in 2009. The economy seems to really be breaking down now plus folks have lost one-third or more of their stock investments while the value of their primary residence continues downward. Credit is still tight. It seems to me that the vacation market is the primary value driver in SoWal. If it holds up, further damage could be somewhat contained. It not, it could be ugly. BTW, travel spending was down over 8% in the third quarter of 2008. Have not seen fourth quarter numbers yet.

This is key. The second/vacation home market is far more vulnerable than the primary home market, imo. No one needs a vacation home, and as we've learned, many who thought they could afford them really can't. The pool of truly qualified buyers is drastically diminished from boom years, and inventory is way up - not just in sowal, but in virtually every second home market in the country. Add to that severely restricted credit and . . . ouch.

 

[JoshMclean]

Here is a snippet from my 2008 end of year report. Statistics are directly from the MLS and are single family homes between Destin and Inlet Beach.


2008 has been a rough year for the economy in many different areas including Real Estate. We showed a sharp decrease in the average sales price in this area compared to years past. The average sales price for the area is now down between 2003-2004 levels. Total sales in 2008 (754) were over 20% higher than the low in 2006 (618). I strongly believe that sales will continue to rise with the deeply discounted homes that are now available.

2005
Total Homes Sold - 1,270 Average Sales Price- $802,072 Median Sales Price- $569,000 Inventory- 1,327

2006
Total Homes Sold- 618 Average Sales Price- $861,960 Median Sales Price- $558,750 Inventory- 2,366

2007
Total Homes Sold- 672 Average Sales Price- $858,516 Median Sales Price- $537,500 Inventory- 2,584
2008

Total Homes Sold- 754 Average Sales Price- $636,225 Median Sales Price- $395,000 Inventory- 2,458

Here you go Shelly.

 

[JoshMclean]

Sales in 2007 equaled 28.4% of the previous years inventory. Inventory increased 179% between 2006 and 2007. Clearly inventory is on the way down right now.

Hey Josh, care to post those tables of single family home stats for Oct - Dec? It might be interesting to see where we're at.

It's not formatting the tables properly. Send me your email address again via pm and I'll send them.

 

[ClintClint]

Okay, who are you and what have you done with the real CC??

Dammit, freaking Mensa stuff slips out periodically---usually I'm stuck in the gutter. You've got to promise not to tell anyone in the lounge.

 

[Miss Critter]

Dammit, freaking Mensa stuff slips out periodically---usually I'm stuck in the gutter. You've got to promise not to tell anyone in the lounge.

Your secret is safe with me.

 

[Matt J]

SHELLY, I haven't been on Sowal as long as you. Have you made a prediction yet about where you really think the prices will truly stabilize at in terms of a historical value? An example would be where I predicted we would see stabilization ( bottom ) at 1999 price levels.

SHELLY's is more of a doomsday prophecy. We'll be bartering and growing our own food before SHELLY thinks it's over.

 

[AAbsolute]

SHELLY's is more of a doomsday prophecy. We'll be bartering and growing our own food before SHELLY thinks it's over.

Have you ever seen SHELLY's prediction for a firming of price? It sounds like he called the downturn correctly.

 

[SHELLY]

Here you go Shelly.

Tanks, Josh.

.

 

[SHELLY]

SHELLY, I haven't been on Sowal as long as you. Have you made a prediction yet about where you really think the prices will truly stabilize at in terms of a historical value? An example would be where I predicted we would see stabilization ( bottom ) at 1999 price levels.

...at present I envision a "bottom" more as matter of time than a matter of price. (Timewise I think at least another year and then flat for several more.) To even predict a price point would be to assume that the "vacation/second home/building lot" market was a "real market" to begin with and not just another speculative bubble like tech stocks and beanie babies. Last time I looked, JDS Uniphase (bubble price: $1,000) was $4-and-change; and Princess the Beanie Bear (bubble price: $700) could be had on Ebay for $3.99. Granted, RE is more tangible than the other two (although the Beanie Bear is pretty close), but it is not only more risky and expensive to carry, but also a depreciating asset that's not an "everyman's" investment--like so many investulators are now finding out.

The economic meltdown; global recession; RE Crash; Credit Crunch; Stock Market/Hedge Fund Collapse; Trillion-Dollar Bailout-a-Palooza; and Madoff-like schemes will totally change the dynamics of investment going forward. All the rules have been tossed away and we're entering uncharted economic waters. When the smoke clears, I think a high-priced "second/vacation home or investment lot" is the last thing the public-at-large will be seeking (or able) to acquire.

The RE-Free Money Frenzy has produced an over-abundance of vacation property all around the world. I know that many who live and vacation here think that this is the "only and most pristine" property worth buying on the face of the earth--truth be told, it isn't.