[Ten]

Originally Posted by tallrick

If this is the bottom, Florida has no hope. Prices need to fall at least six more figures or the area's economic growth will forever be stunted. High real estate prices put a burden on business and employees. We need a hard crash badly to cut our tax burden.

Good point.

We're in the mortgage crisis/banking scandal hurricane's eye, so to speak. Huge volumes of resetting ARMs are nearly upon us and this next phase won't be pretty. As one poster implied, that'll almost certainly bring about more Orwellian money management by Helicopter Bernake's fed and our masters in DC, but the net result won't be too terribly different. They can run but they cannot hide this problem.

I wouldn't consider buying property in FL until well into, and preferably past, 2009. My recent tour of the state's central and southern west coast reveals there's a whole lot of reality yet to happen -- thousands and thousands of low-mid six figure homes and not an industry in sight.

And for a real splash of cold water, check the foreclosure maps and statistics. And all this only up till this point in time, with all those resetting ARM's yet to fall.

[FLtoNC]

Taking all these factors into consideration, what would you expect a home that was worth $500K in the height of the real estate market (was that in 2005/2006?) to sell for when the market hits rock bottom? I have heard people say the market will or needs to correct itself to 1999 prices, but who thinks this will really happen? And if it does happen, I feel very sorry for those people who purchased a home when the market was hot. How can anyone sustain a loss that big if and when they need to sell (assuming they don't foreclose before then)?

[58robbo]

Originally Posted by Ten

Good point.

We're in the mortgage crisis/banking scandal hurricane's eye, so to speak. Huge volumes of resetting ARMs are nearly upon us and this next phase won't be pretty. As one poster implied, that'll almost certainly bring about more Orwellian money management by Helicopter Bernake's fed and our masters in DC, but the net result won't be too terribly different. They can run but they cannot hide this problem.

I wouldn't consider buying property in FL until well into, and preferably past, 2009. My recent tour of the state's central and southern west coast reveals there's a whole lot of reality yet to happen -- thousands and thousands of low-mid six figure homes and not an industry in sight.

And for a real splash of cold water, check the foreclosure maps and statistics. And all this only up till this point in time, with all those resetting ARM's yet to fall.

my resolve is starting to diminish. everything you have written makes absolute sense. all the fundamentals are pointing to a near collapse of florida real estate prices.
the problem is that i have seen this coming for ages and it never seems to arrive. i now even hear some agents carrying on about falling inventories and rising prices. i think the fed is trying to deflate dollar value to bring prices of everything else up in line with real estate prices. they are doing this instead of letting the banks go down the tubes.
regardless i have $300k in cash and am trying to weigh up what will drop more, the value of RE or the dollar.

[lionking]

Originally Posted by FLtoNC

Taking all these factors into consideration, what would you expect a home that was worth $500K in the height of the real estate market (was that in 2005/2006?) to sell for when the market hits rock bottom? I have heard people say the market will or needs to correct itself to 1999 prices, but who thinks this will really happen? And if it does happen, I feel very sorry for those people who purchased a home when the market was hot. How can anyone sustain a loss that big if and when they need to sell (assuming they don't foreclose before then)?

I didn't think it would drop that low either but more and more I think it might dropped to pre-2000 prices. the SHTF

[58robbo]

Originally Posted by Wild Style

^^

Well, it could always happen again IF the govt. does not prevent banks from offering exotic loans of any type to the public sector. It should be federal law that only 30 yr fixed loans are available. It should become law that at least 20% down is needed and the person(s) applying for the loan can not buy a house that is more than 2.5 to 3 times their annual income. That would stop this from ever happening again. I am sure there are SOME cases where it could be more beneficial to take out a exotic type loan. But the it isn't worth it considering what could happen again.

you could also stop bailing out banks who make irresponsible investment decisions. that might go a whole lot further then slapping on further regulation

[58robbo]

Originally Posted by Wild Style

thats exactly right, if you can not afford a car then take a bus/mass transit. Its that simple, you can't afford it then don't buy it. This mentality where people think they are owed something or that they should spend outside their means is what has placed us in this curious position.

I live in south florida right. Some places here don't have good bus coverage. If I couldn't afford a car then I would make sure I lived in a area of town that did have good coverage. Its called sensible living, people should try it.

but you don't need big government to make laws for you to be sensible. if you are sensible that will have its reward. if you are irresponsible then that will have it consequences.
why can't people learn to take resposibility for their own actions

[jbravo]

I have my powder dry.
Guys, remember.... 125K bought you a nice house in most areas of Fl in 1999.
Really.
Think about it.
Think about it again.

[Davachka]

Originally Posted by 58robbo

which areas are you looking in? i have been monitoring the market for quite a while in north tampa (200 properties on realtor.com which i have occassionally cross refernced with the mls and various county appraiser sites). i can tell you that i have seen a 60% reduction (county court auction) on one property and it was a nice place. of the 200 there were another 3 which went for 50% less. of the 40 or so places that sold in the 15 months which i have monitored them, 15%-20% discount seemed the norm. there were obviously places that went for full asking too.
it really depends who's selling, how bad they need to let go, their situation with the banks etc.
i have put in many lowballs and had them ignored. i put this down to not finding a distressed enough seller. i've decided to wait because more of them are popping up each day, and everyday brings fewer buyers
anyone though who belives that the deals aren't out there in this market needs to do a bit more research

There are "deals" to be had, I am not disputing that. Just in our experience, they seem to be in the less than desirable areas (for us). I'm sure others are happy with those neighborhoods, but they're not what we are looking for.
For example, one of the first times we house hunted in Tampa, we found our ideal home. Everything we were looking for, and we are very particular. Unfortunately, we did not like the area. This was a large, new Mediterranean home in the low 700K range, but it was in Seffner. It was a lovely subdivision in an almost depressing looking country town right outside of Tampa. This home is now in the low 500K range. Almost 200K off! What a steal we thought, until we remembered it is still in the less than desirable area, in our opinion, and not worth it because of the neighborhood.
Same with New Tampa. We saw homes go from the high 600K range that we looked at months ago, in the 500's now. Yes, the prices have dropped, but we still do not find the area one we would move to.
Then, go to South Tampa or closer to downtown. The homes are still selling closer to the asking price. So, yes, prices are dropping in some areas, but not all neighborhoods, and not the ones we were looking at. We eventually found a home, one in our desirable area, and one with the details we were looking for, and at a % off, but definitely not 20%.

[Ten]

By the way, for a realistic take on what's befalling the Florida housing market, head on over to Mish's Global Economic Trend Analysis (I can't link because it's a blog) and read the email from Mike Morgan of Sunday, May 18. Amazing stuff:

Today I am convinced we are headed towards a Depression, and I don’t see any means to avoid it. The reason for this statement is simple. Inventory of homes is now beyond a two year supply and growing, while prices are falling off the cliff. That does not even include multi-family housing, as this market was also overbuilt. But it gets worse.

Mike is from Morgan Florida Real estate Group and offers REO services.

[Mike1306]

Originally Posted by Ten

By the way, for a realistic take on what's befalling the Florida housing market, head on over to Mish's Global Economic Trend Analysis (I can't link because it's a blog) and read the email from Mike Morgan of Sunday, May 18. Amazing stuff:

Today I am convinced we are headed towards a Depression, and I don’t see any means to avoid it. The reason for this statement is simple. Inventory of homes is now beyond a two year supply and growing, while prices are falling off the cliff. That does not even include multi-family housing, as this market was also overbuilt. But it gets worse.

Mike is from Morgan Florida Real estate Group and offers REO services.

Well I guess he has not been watching all markets in Florida because our inventory here has dropped almost 13% since the beginning of the year.

You are also reading the thoughts of someone who has been a realtor for less than 4 years and before that was mainly in marketing.

So we have someone whose current business relies on REO's and BPO's and would benefit if the market kept crashing. You think he may be a little biased?