To answer Skier's questions regarding the data. The data posted below is of properties that went pending during the time frame (not of all pending properties). While I agree that closed data is important, IMHO closed data doesn't accurately reflect "current" sales demand because properties may close today that went under contract 8 months ago which was a different environment. If it went under contract today, it tells me todays demand.
I'm working on some new data comparing June 04 to June 05, separating sold data for homes, condos and land in Destin, 30A and Panama City Beach. The trend remains the same: The number of sales are significantly lower. The only property type that actually had a slight increase in the number of units sold this year was 30A condos from 27 closed last June to 30 closed this June. As mentioned above, since this is "sold" data, some of these sales will reflect the closings of preconstruction condos that went under contract last year.
One thing that is clear is that the average sales price is significantly higher than last year in ALL areas. This is great for those of us who are holding or living in our properties. The property "flippers" will find that they may have to hold their investments a little longer than last year.
I also agree with the demand vs supply comments. While supply is high right now on 30A (approx 1140 lots listed), I believe that our growth restrictions and the quantity of preserve land will inevitably keep our supply low. Increased exposure of and in-migration to our area will increase the demand over time and 3 years from now, those of us who own and held our property will be very glad we did.
I would be very interested in forclosure data because I have several clients who MUST sell. They bought speculatively, they are over-extended because they got greedy and I have true concern for them. They made a bundle last year and thought they'd do the same this year. I think this is a big factor in why we're seeing so many price decreases. We simply had too many speculative buyers who had no intention of putting their properties on the rental market or holding them for any period and they can't comfortably afford them. I agree with Shelly, all of those freaking about the "bubble" are top heavy and perhaps got greedy.
When you compare our prices to many other comparable areas, I think we're still less expensive. Maybe some on the board could make comparisons for us. Are there still places in Florida where you can buy a new home 5 minutes to comparable beaches for 300K (such as those in north Santa Rosa)? Are there great bayfront lots so close to high end beaches, shopping, restaurants etc. for 600K? One of my realtors is from Palm Beach Gardens and she says prices here are much lower. I also have property in Tampa Bay which has not appreciated nearly as much as my property here but it's still more expensive.
I'm not afraid of a bubble because I'm not over-extended. From an investment standpoint, when people dump their properties, smart investors will pick them up - the old adage "buy low". How low they will go will be interesting. I don't think we're gonna see prices plummet. The bulk of owners on 30A are affluent and have the means to pay for what they've got, even if they don't want to, so I don't think we're gonna see many fire sales. I think most will just have to wait till they sell to buy that new Mercedes.
Right now, prices could drop 30% and we'd be at last year's prices. If 3 story homes ever get to $640K in Seacrest Beach again which is what I paid last June, I'm gonna beg borrow and steal to get another.