January Real Trend Report in Walton Sun

The real trend report for January for all of Walton County showed the following data--

Home sales--units down 20% to 111, total dollar volume down 38% to $48.5 million, and average price down about 20% to $437k.

Lot sales--units down 50% to 193, total dollar volume down 64% to $19.8 million and average price down 28% to $102k.

Condo sales--units up 184% to 136, total dollar volume up 308% to $116.8 million and average price up 44% to $850k.

Home sales and lot sales continue to move ever lower in the county in spite of the increase in activity discussed by several realtors on the board.

The condo sales look interesting and I would be interested to hear from some realtors as to what happened in January. Were there a large number of closings on condos sold preconstruction during the boom? Or, is this a true uptick in condo activity?

Is this versus December totals or year over year?

Thx.
GW

Grand Dunes, South Tower closed in January, that probably has a lot to do with the increase. The majority of those sales were over a million dollars.

Is this versus December totals or year over year?

Thx.
GW[/QUOTE

Except for the anamoly with condos, unit sales in January are very comparable to December.

Here is a statistic: The number of buyers willing to pay a ridiculous price for a home is down 100% in my household.

Smart buyers aren't going to pay premium prices when half the county is for sale.

I disagree slightly with your comments above. I do think there will still be some people that will overpay for a property because they aren't smart enough to do adequate research about the market or they have too much money and don't really care about the price. They see something they like and they buy it. Take the unnamed buyer of a house in Watercolor. He paid the highest price ever paid for a house in Watercolor, $3.85 million during the latter part of 2006 as prices continue to fall. Not a smart buy IMHO--he could have gotten a much better deal if he had shopped around or waited a while. But, he probably had enough money that he just didn't want to waste the time and effort.

It's very similar to going to the grocery store. A low income person that has no disposable income will labor to find the lowest priced generics in the store while someone with a little more money won't shop too hard to find low prices. Or, a car purchase. Some people labor to find the best price on a Toyota Camry while a higher income person might simply go to a single Lexus dealer, negotiate a bit, but basically pay more than the car is actually worth just to eliminate any hassle of buying.

So, there will be some high income individuals that will pay a high price for a $10 million property in the retreat or $7 million in Rosemary or $4 million in Watercolor and they don't care if the day they "drive it off the lot" the value goes down by 20% or more (none of these recent purchases would come close to reselling at the price paid by these high worth individuals). But, for the most part, prices will continue to decline because most of us will research and negotiate to find the best price possible. Inventory levels will demand price decreases, especially for builders and investors with lots of product. John Willis and Monte Hewett homes are a couple of examples.

And I stick to my guns when I say the realtors fed the fire. And the realtors aren't the only ones that are going to suffer the consequences. Those who bought to flip property are now praying the "correction" is over. Of course it's the other guy that will have to take the hit, not them. They are too smart to lose money. Right. So they'll sit and wait it out instead of selling me and others a place for my family to realize my lifetime dream of owning a home in a great area with great people, without having to have 5 jobs to afford it.

Most of the buyers weren't looking to settle in SoWal, they just wanted to use it for a little while so they could make their cash and move on to the next investment. Let me guess, you feel good because your property value has increased as a result? It might look good on paper, but try selling in today's market.

Of course I am a hypocrite. In another post, I did make fun of those who gripe on the vent. I'm just too long winded to condense mine to a paragragh. 🙂

SoWal didn't have to become the new Miami when it comes to home pricing. I can't help but think of the expression we use in medical sales that says, "Pigs get fat. Hogs get slaughtered." I'm all for folks making a reasonable profit. But just like the stock brokers who drove the technology stocks to record overvalued levels, the correction will come.

I just strongly resent having to compete with speculative investors from the North who are trying to get me to make them wealthy sellers from the north. And that especially includes those who flocked to the gold rush who are "Northerners" from Bham, Atlanta, Memphis, etc, Sorry Doctor, I'm trying to educate my kids, not your's.

If I understand correctly the logic of the nattering nabobs of negativity (i.e. day traders), it is not to buy real estate in a buyer's market.

My Dad used to tell me to believe "none of what you hear" and "only half of what you see". The optimistic rah-rah I keep hearing and reading from agents who want sellers to believe the big pay day is right around the corner just isn't meshing with reality.

Here is a statistic: The number of buyers willing to pay a ridiculous price for a home is down 100% in my household.

If I were a betting man (and I am betting with my hard earned dollars), I truly believe a much deeper correction is about to begin. Smart buyers aren't going to pay premium prices when half the county is for sale.

Just get in the car and drive around SoWal. How many developers are competing for buyers right now? Oh, that's right... they all have deep pockets and can wait out a correction. Pfffft. They didn't acquire those big parcels of land with extra cash they had just lying around. Funny, but borrowed money has a price. And builders get a little nervous when there is no work for them. Things are about to get very competitive. And a little patience might go a long way if you are a buyer.

If you pull up the MLS listings you'll see how many dumpy 3 bedroom homes are listed in the $499,000 and up range. Heck, they might as well ask for a million. They aren't going to get it despite whatever the listing agent convinced them it was worth. I want to yell that at the knucklehead that has the little row houses listed on 393 for $299,000. He can have open houses until hell freezes over, but those houses will never be worth what he is asking.

I've been looking and will continue to wait until prices are more realistic. I know five Realtors in the area and none of them are selling squat. I hate it for those trying to support a family, but until sellers decide to start ignoring fools and start selling at a reasonable profit margin, they are going to get the same results as Mr.Optimistic on 393.

Many of the lot prices are a joke too. One day I will buy or build in Pt. Washington. I love the area. But some of the sellers need to get real. One nice lot in Pt. Washington purchased just over a year ago for $139,900 was listed for $386K. The owner dropped the price 4 times, down to $375K and I guess gave up and took it off the market. I drove right down the street to an almost identical development and lots were listed for $350K to $400K. It's almost comical.

Let's see, maybe I'll be one of the lucky ones and really get a great lot buy for $275,000... then I can pay $195 a sq. ft. to build a 2000 sq.ft home. Hmmm... $665,000 plus another $350/mo for homeowner's coverage and maybe $250+/mo for property taxes. Sorry, but that's where a fool and his money are soon parted.

I've thought long and hard about how this happened. The only thing I want to ask realtors is who do you think caused the market to go crazy? Did the beauty of this area suddenly cause everybody to get financially stupid? Or was it the new proposed airport? Or the article in the latest trendy magazine? Do they really think people are that stupid?

No. The realtors poured gasoline on this fire and have had a direct impact in artificially inflating prices to the point where they will now suffer the consequences. I hope the greedy ones starve for a while. They created this Frankenstein's monster and it's going to get ugly for architects, builders, bankers, mortgage lenders, and suppliers.