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Smiling JOe

SoWal Expert
Nov 18, 2004
31,648
1,773
skier said:
Hey Doug,

Yeah I couldn't resist trying to bring balance to the posts that seem to ignore the current state of the market. It's not doom and gloom. IT'S FACTS and simple reality. Are you and others that don't seem to like my posts opposed to discussing facts and reality???

Prices continue to drop. Recent sales in the big communities along 30A have been at prices well below the "market" just 6 months ago. A lot in Watercolor just got dropped to $450k and there are numerous lots under $600k. In Watersound, people continue to drop prices--several lot are below $700k again next to or near lots that sold for $800k or $900k within the last year. It appears (based on some other posts that I cannot confirm) that for the first time in years, the recent developer releases in Watercolor and Watersound did not sell out with 50 or 100 buyers waiting on the lottery list. The folks in ALys are calling potential buyers almost begging them to buy.

You might want to live in la la land. But, for people that are invested in the market and wanting to knowing what is really happening, I'll post info that gives actual data in the current market. Some might even find good buys in the info I post. These people that are looking for info don't need to hear people talking about returns of 5, 10, 15, 20, 30, 40 percent that simply aren't there anymore. In fact, most folks that bought recently are now under water with their investments (if they had to sell today, they would lose money period, end of story, due to the excess inventory in the market). Some people actually want facts, not hype.

So, keep on hyping and I'll keep on throwing facts back at you to balance the equation. If the hyping stops, I'll stop throwing facts out that blow the bubble on the hype. Or, hopefully, the market will turn around and my statements of fact might even be pleasing to you. I don't want to see people lose money. I don't want to lose money. But, the market is what it is and nothing I say or that you say can change that.

Back to lurking.

The prices are dropping, but dropping from what? Ridiculusly high prices? I have been saying for a long time that many Realtors and agents have taken overpriced listings just so someone else would not get the listing. Those people do a great disservice to everyone. I have yet to hear, see, or read of anyone selling for less than they paid, which happens everyday in the stock market.

The folks in Alys Beach and WaterColor are trying to get people to buy at really high prices, compared to the prices 2 years ago. They would have no problem selling if they were not so damn greedy.

I have not seen people who are upside down, or underwater as you say, sell for less than they bought. They just wont do it at the moment. That could change.
 

skier

Beach Lover
Mar 7, 2005
116
0
Smiling JOe said:
The prices are dropping, but dropping from what? Ridiculusly high prices? I have been saying for a long time that many Realtors and agents have taken overpriced listings just so someone else would not get the listing. Those people do a great disservice to everyone. I have yet to hear, see, or read of anyone selling for less than they paid, which happens everyday in the stock market.

The folks in Alys Beach and WaterColor are trying to get people to buy at really high prices, compared to the prices 2 years ago. They would have no problem selling if they were not so damn greedy.

I have not seen people who are upside down, or underwater as you say, sell for less than they bought. They just wont do it at the moment. That could change.

Joe,

I agree with you. I have yet to see anyone that is currently underwater sell at a loss (but I don't look at but a fraction of the transactions in Walton County). And, maybe no one will. It all depends on how much staying power the investors have.

There are a couple of homes in Watercolor that sold 6 or 8 months ago for very high prices. The investors that bought these homes immediately put them back on the market at ridiculous prices. They have both reduced prices to the point that, if they sell, the profit margins after commissions and carrying costs will be razor thin. One of these investors also owns another house in Watercolor that he bought at a very high price and is trying to sell at a ridiculously high price. Maybe he will get his price. If not, I hope he has lots of resources because his investment in the market is huge by most peoples standards.

But, regardless of whether people take the losses or not, if the prices at which sales do occur are lower than the market prices these people paid at the time, they are underwater and the market has fallen. The key in the newer communities is the builders of spec homes with the low basis in the land. Due to the build out time frames, the builders will build and they will be forced to sell rather than sit on the homes. I believe that these builders will the ones that set the new standard for market prices. By the way, several builders are actually selling the lots they bought in the original developer releases. What does this tell you? Why sell the lots if you can build a house and reap even more profit? Builders typically buy lots to build homes on, not to sell before building. This is another sign of the times.

Time will tell.
 

Cavallino

Beach Comber
Jun 11, 2005
34
0
52
depends on the date
Skier,

Are you really an owner? Your repetitive messages appears to hope values decrease dramatically. If you really are an owner, state the MLS listing of your property....like many other's have requested!

Doug
 
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Seasider

Beach Lover
Nov 27, 2004
74
4
skier said:
I counted 39 closings for the same period in 2004.

The houses sold this year closed at prices substantially higher than last year. The rapid runup in prices is indeed slowing the market, but I have not seen any evidence of market wide price pull back in Seaside.
 

Smiling JOe

SoWal Expert
Nov 18, 2004
31,648
1,773
skier said:
... The key in the newer communities is the builders of spec homes with the low basis in the land. Due to the build out time frames, the builders will build and they will be forced to sell rather than sit on the homes. I believe that these builders will the ones that set the new standard for market prices. By the way, several builders are actually selling the lots they bought in the original developer releases. What does this tell you? Why sell the lots if you can build a house and reap even more profit? Builders typically buy lots to build homes on, not to sell before building. This is another sign of the times.

Time will tell.

I know plenty of builders who have sold lots rather than building on them, just to free up debt load, and keep the cash flowing. You must remember that a builder who purchases a lot today, may take at least 6 months before he begins construction, depending on how many houses he is building. Sometimes, builders don't start construction even that soon. Right now, you are looking at 8-9 months to complete a home once you begin. So, even if he buys the lot today, he will not be selling that until a least a year down the road. If these builders are nearing completion today, they can still afford to sell for cheap, and pocket some good cash. They will not have a problem making money.

Everyone can look at Cypress Dunes to see what is going to happen with build out times, which are quickly approaching for some lots. The lot I mentioned earlier, lot 112 Cypress Walk, has one of the longer build out times of all the 44 which are actively listed. The buildout time for it is about 13 months to begin construction and an additional 1.5 years to complete. Other lots in there, including one priced around $1.2 M, have construction start dates very early in 2006. I don't think $1.2 M is a motivated price. Cypress Dunes is looking at possible extensions on a case by case basis.

One problem that may come back to haunt Cypress Dunes, and Ashwood Development, is that Coastal Properties, the exclusive brokerage, would not pay co-brokerage (commission) to another agent who brought a buyer to them. That alone was enough to make other Realtors push people away from Cypress Dunes. At the time of the Seller's Market, this was not a problem, but now that the market has shifted to a Buyer's Market, little is moving in there, and I don't see other agents remembering Cypress Dunes in a favorable light due to the exclusive agreement with Coastal Properties.
Just my two cents.

In addition to the 44 Active listings for lots in Cypress Dunes, as of yesterday, there were 9 lots under contract, and only 7 lots have closed in the last 90 days.

Skier may bring the extreme end of doom and gloom, but he makes some very valid points which everyone thinking of purchasing today should read. I know most of you are not new to this market, and many of you will not be affected at all by that which Skier is bringing up. The market has declined, but I still say that most Sellers are not very motivated. There are a few out there, and some good values can be purchased right now.
 

ecopal

Beach Fanatic
Apr 26, 2005
261
7
THE TOP TEN CAUSES TO THE PERFECT STORM THAT SANK THE EMERALD COAST REAL ESTATE MARKET?

1. Hurricane Ivan last year

2. Devastating hurricanes this year-and it's not over.

3. Over development resulting in bloated inventory.

4. Excessive speculation with leveraging.

5. Fears about hurricanes getting more frequent and more severe due to global warming.

6. Highly publicized concerns about "real estate bubble" bursting.

7. Beach erosion and shark attacks are making beaches less inviting.

8. interest rate hikes

9. record high gas prices

10. General national malaise of weak economy, Iraq mess, exploding budget and trade deficits, New Orleans disaster, terrorist menace, and loss of confidence in federal government's ability to deal with it all.

Did I leave something out?
 

Smiling JOe

SoWal Expert
Nov 18, 2004
31,648
1,773
ecopal said:
THE TOP TEN CAUSES TO THE PERFECT STORM THAT SANK THE EMERALD COAST REAL ESTATE MARKET?

1.Hurricane Ivan last year - yes

2. Devastating hurricanes this year-and it's not over. - yes

3. Over development resulting in bloated inventory. - yes

4. Excessive speculation with leveraging.

5. Fears about hurricanes getting more frequent and more severe due to global warming.

6. Highly publicized concerns about "real estate bubble" bursting. - yes

7. Beach erosion and shark attacks are making beaches less inviting.

8. interest rate hikes

9. record high gas prices

10. General national malaise of weak economy, Iraq mess, exploding budget and trade deficits, New Orleans disaster, terrorist menace, and loss of confidence in federal government's ability to deal with it all.

Did I leave something out?

I think "Sank" is the wrong term. This market has not sunk. The word sunk insinuates that people are losing money. This is not the situation. The reasons you mention may be some factors slowing the market. One you failed to mention was the higher prices weed out many potential buyers by getting out of their price range. I will highlight the few that I agree with for some that are helping to slow the market.
 

Cork On the Ocean

directionally challenged
I was told of a gloom and doom quote on the board and knew it was skier before I checked the board :rotfl: :rotfl: .

The median price of a pending lot in Watercolor between 08/01/04-9/8/04 was $637,500 (22 lots)

There was only one lot in Watercolor that went pending this past month which was a gulfront lot for $2,295,000

From 5/1/04-9/8/04 - 91 lots went pending in Watercolor for a median price of $600,000
From 5/1/05-9/8/05 - 18 lots went pending in Watercolor (80% decrease in # of sales). The cheapest lot in watercolor was $659K. The median price is $752,500 ( 25.4% appreciation ).

Prices have not dropped below last year's price. They may have dropped from 2/05 but they still made a nice annual appreciation. Will they drop next year? :dunno: 91 sales in 4 months in one community is really high. 18 sales (4 per month) for such a small area is probably normal in lots of areas of the state. My feelings are that it's gonna be a lot tougher to sell this year than last year because of the inventory. Average days on market in watercolor this year has been 125 days which isn't bad.

Same 4 months in Seagrove:

Last year there was 193 sales in Seagrove Beach with a median price of $587,000 and average Days on the Market was 44 days.
This year there were 36 sales (81% decrease in # of sales) , the median price was $702,500 (19.6% appreciation) with an average days on market of 111 (2.5 times as long).

I can't imagine a crash because we're not that expensive compared to other comparable areas across the state. I think we're just gonna move into a normal healthy market over the next couple of years with nice annual appreciation. The quick flippers are the only ones that could really be hurting if they are overextended, can't afford their payments and it's taking longer to sell. Imagine payments on $500K for a piece of land you're sitting on. Payments must be $4000 per month. That's a chunk for most people. It's not like these people bought these lots cash and are sitting on them which many small builders do. People got crazy last year and many borrowed beyond they're means. If someone bought 2 months ago and thought they would make a huge profit in 2 months they were dreaming, If they sit for a year, they'll probably make a decent return.
 

Cork On the Ocean

directionally challenged
Guess I should do houses:


Watercolor 05/01/04-09/08/04 - 24 homes went pending for an average sq ft price of $599.38

Watercolor 05/01/05-09/08/05 - 10 homes went pending (58% decrease in the number of sales) and the ave sq ft price was $752.96 (25.6% increase in value)

These are facts. It's from the Emerald Coast MLS. FSBO's and in-house sales may not be in the MLS but these are the closest to facts that we have to go on.
 
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