2008 Florida Housing market Thread Jan - Mar (Palm Beach, Rotonda: mortgage, lender)

[jbravo]

At what year prices do you think the market will stabilize at?
It's meaningless to say 30% off.
Off what year?

My guess is 2001.

Thanks.

[CJFlorida]

Originally Posted by jbravo

At what year prices do you think the market will stabilize at?
It's meaningless to say 30% off.
Off what year?

My guess is 2001.

Thanks.

People are saying what % off the peak pricing. Peak prices were hit in 2005-early 2006.

So when someone says 30% off, they are guessing the bottom will be 30% off peak prices.

Some also say what year price levels will return too. So someone may say 2001 and they mean they think prices will eventually return to 2001 levels, adjusted for inflation.

It also depends on what part of Florida and what type housing. Some areas may have been 20% overpriced at the peak, the most extreme end of the markets such as some condos will drop to less than a third of their peaks.

[jbravo]

Originally Posted by CJFlorida

People are saying what % off the peak pricing. Peak prices were hit in 2005-early 2006.

So when someone says 30% off, they are guessing the bottom will be 30% off peak prices.

Some also say what year price levels will return too. So someone may say 2001 and they mean they think prices will eventually return to 2001 levels, adjusted for inflation.

It also depends on what part of Florida and what type housing. Some areas may have been 20% overpriced at the peak, the most extreme end of the markets such as some condos will drop to less than a third of their peaks.

Ok, good answer.

[hiknapster]

Well, greed may have precipitated the whole mess, but "The Good Ship Bernake" is sinking the entire American economy, the housing disaster and all that is wrapped in it, be damned.

As I said, almost three months ago, even municipal bonds are wrapped up in this. There was a run on the Florida fund, which I posted, and hardly anyone took notice.

[kdzgon]

Originally Posted by CJFlorida

The vast majority of boomers will have to keep working, retirement savings are very low. Also, many are looking for alternative, inexpensive states to retire in. Lastly, they tend to look for planned retirement communities with services and inexpensive housing. I also believe I have read where many seniors are looking to leave Florida due to the high costs.

The thought that baby boomers will all retire and come save the Florida housing market is a myth.

Just to clarify, I never said anything close to your last statement.

I agree many retirement savings are low, and it is a situation that is worsening. However, I would also say the leading edge of boomers have a greater percentage of defined benefit plans vs defined contribution plans and similar. Seventy percent of union workers have a defined benefit plan. Government workers tend to have excellent retirement plans, and I think I read somewhere that 50% of all jobs are now government-related. Overall, I don't believe the real estate market trends for the next 3-5 years will be significantly affected by low retirement savings.

Many will continue to look for better weather as well as less expensive states, including those with features such as no state income tax. Florida has many "planned retirement communities with services and inexpensive housing", "inexpensive" being relative. We had quite a large selection of homes to choose from, priced at 50% or less than that of our current home. Utilities, gas, real estate and income taxes are all less in Fl than here in the Northeast. Living on a fixed income would be easier there than here for us, and I don't believe we are alone in this, at least not yet.

[CJFlorida]

Originally Posted by kdzgon

Just to clarify, I never said anything close to your last statement.

I agree many retirement savings are low, and it is a situation that is worsening. However, I would also say the leading edge of boomers have a greater percentage of defined benefit plans vs defined contribution plans and similar. Seventy percent of union workers have a defined benefit plan. Government workers tend to have excellent retirement plans, and I think I read somewhere that 50% of all jobs are now government-related. Overall, I don't believe the real estate market trends for the next 3-5 years will be significantly affected by low retirement savings.

Many will continue to look for better weather as well as less expensive states, including those with features such as no state income tax. Florida has many "planned retirement communities with services and inexpensive housing", "inexpensive" being relative. We had quite a large selection of homes to choose from, priced at 50% or less than that of our current home. Utilities, gas, real estate and income taxes are all less in Fl than here in the Northeast. Living on a fixed income would be easier there than here for us, and I don't believe we are alone in this, at least not yet.

http://www.nytimes.com/2007/02/26/us...=1&oref=slogin

[Wild Style]

Originally Posted by CJFlorida

http://www.nytimes.com/2007/02/26/us...=1&oref=slogin

^^

well there goes the whole moving to Florida in droves theory.

[Mike Peterson]

Originally Posted by Wild Style

^^

well there goes the whole moving to Florida in droves theory.

You may want to read the article again.

They are talking about senior citizens 75 years or older that had moved down south when in thier early 60's.

As they age and their spouse dies they want to be close to family again and head back north. This is not a new phenomenon, it has been this way for years and if more 60 or so seniors are moving down here then more will be moving back.

“As the numbers increase of people in their early to mid-60s that move from the North to the South, we would also expect the numbers of people 75 and older that move from the South to the North to subsequently increase as well,” said Grant I. Thrall, a geography professor at the University of Florida in Gainesville.

[Wild Style]

Demographers say that the last time more older people left the South than moved there was during the Depression, when there was a net loss of people older than 65.

taken from the fourth paragraph of the last page.

As I said, the whole moving here in droves theory has gone out the window.

[kdzgon]

Originally Posted by CJFlorida

http://www.nytimes.com/2007/02/26/us...=1&oref=slogin

I presume you were referring to this lead sentence: For the first time since the Depression, more Americans ages 75 and older have been leaving the South than moving there, according to a New York Times analysis of Census Bureau data.

But, right within that article are these statements (emphasis mine):

From 1995 to 2000, another Census Bureau survey of migration patterns found, for the first time slightly more people ages 85 and older left Florida than settled there.

From 2004 to 2005, a separate Census Bureau survey reported a slight gain in migrants 75 and older to the South.

The reversal appears to be driven in part by older people who retired to the South in their 60s [10 - 15 yrs earlier], but decided to return home to their children and grandchildren in the Northeast, Midwest and West after losing spouses or becoming less mobile.

“As the numbers increase of people in their early to mid-60s that move from the North to the South, we would also expect the numbers of people 75 and older that move from the South to the North to subsequently increase as well,”

William H. Frey, a demographer at the Brookings Institution, said, “The South, and Florida especially, has been a magnet for yuppie elderly: younger seniors with spouse present and in good health. “These are a catch for communities that receive them, because they have ample disposable incomes and make few demands on public services,” he continued. “The older senior population,[the ones moving back North] especially after 80, are more likely to be widowed, less well off and more in need of social and economic support.”

Calvin Beale, senior demographer of the Economic Research Service at the federal Department of Agriculture, said: “After age 75, as health diminishes and/or widowhood occurs, there is some measure of return flow back to areas of origin, or wherever a caretaker-minded son or daughter lives. And this means a net outflow from the South.”

So, I'm sorry - I don't see how this article in any way shows any great evidence of a situation that will have significant impact on the market, especially as a result of low retirement savings. These statistics are nothing more than evidence of a natural progression in life. As demonstrated in this article, in large part it's a numbers issue - an aging population will result in higher numbers of individuals returning to their families when they need more care. If anything, this article points out what I said: people relocating to Florida can afford to live there.