Homes going up or Down in Price? (Cape Coral, Fort Myers: gated, compensation)

[monikac21]

The percentage of "traditional" sales (neither bank-owned or short sales) made up 52.34 percent of all transactions involving from Realtor Association of Greater Fort Myers during June, 2011.

Overall median price, increased 9.14 percent in June to $101,500 from $93,000 a year ago. This is the fifth month in a row that the median price has been above $92,000.

The inventory of single family homes declined by 2,323 homes (33.20 percent) from last June and now stands at 4,675. This is a slight increase from May, 2011, when our inventory was 4,656 homes. Pending sales - those under contract and awaiting closing - are 124.24 percent higher than last June.

The numbers reported by the Realtor Association of Greater Fort Myers and the Beach Inc.

[garyreno]

20% Drop in Housing to Cause Recession in 2012, Says Gary Shilling | Fin - Daily Ticker - US - Yahoo! Finance

[monikac21]

The US is a very large country - what is true for one area is not true for another. There are several articles reporting exactly the opposite - they are talking about a housing shortage.

HOusing shortage coming (CNN/msn)

http://www.huliq.com/8738/92045/hous...alysts-say-yes

http://articles.moneycentral.msn.com...-shortage.aspx

http://realestate.msn.com/article.as...entid=23505825

http://money.cnn.com/2010/06/15/real...bble/index.htm

[garyreno]

Originally Posted by monikac21

The US is a very large country - what is true for one area is not true for another. There are several articles reporting exactly the opposite - they are talking about a housing shortage.

HOusing shortage coming (CNN/msn)

A housing shortage in 2012? Some analysts say yes

Housing shortage is on the way, experts say - MSN Money

Economist: Housing shortage coming in 2011 - MSN Real Estate

New housing bubble coming? - Jun. 15, 2010

Old Links from Feb, Mar 2010.

[nhkev]

Originally Posted by garyreno

20% Drop in Housing to Cause Recession in 2012, Says Gary Shilling | Fin - Daily Ticker - US - Yahoo! Finance

I didn't hear him mention lee county specifically (this is discussing lee counties home prices) I don't know one single person who nationally has said they expect an increase in prices in the next year so can we just once and for all agree on that?

So to put out anything nationally is pointless. a normal supply level nationally is under a 6 month supply. it is currently 9 months or more. so that means there is plenty of supply. on the demand side there are an annual avg of 5 million sales, a normal demand would be 6 million a year so demand is weak. so if there is a high supply and low demand it would seem reasonable for prices to decline. Experts can differ on how much they will drop and they are all guessing. some of them will obviously be right but we will know the same time they do when sales volume and inventory reach normal levels prices will stabilize.

So if you take Lee counties 3 month supply of inventory and super strong sales volume and prices have already stabilized for 24 months and then headed up year over year for the past 6 months, foreclosures have fallen off by 80% and new construction has been non existant compared to past years it is clear there will be a shortage of inventory going forward and worse come next April when the backlog of lee counties foreclosures have worked through the system.

In June the avg foreclosure sale was 69k the avg short sale was 84k and the avg traditional sale was $148k. So it is easy to see if there are less foreclosures and short sales as a total percent of sales it won't take long for the median to jump quickly. You don't need national experts unless you are looking to buy a house somewhere else in the country. I will openly debate any "expert" you put in front of me regarding lee county. But I think you would be hard pressed to have someone look at the data points and not draw the same conclusions I have come up with.

[monikac21]

Originally Posted by nhkev

I didn't hear him mention lee county specifically (this is discussing lee counties home prices) I don't know one single person who nationally has said they expect an increase in prices in the next year so can we just once and for all agree on that?

So to put out anything nationally is pointless. a normal supply level nationally is under a 6 month supply. it is currently 9 months or more. so that means there is plenty of supply. on the demand side there are an annual avg of 5 million sales, a normal demand would be 6 million a year so demand is weak. so if there is a high supply and low demand it would seem reasonable for prices to decline. Experts can differ on how much they will drop and they are all guessing. some of them will obviously be right but we will know the same time they do when sales volume and inventory reach normal levels prices will stabilize.

So if you take Lee counties 3 month supply of inventory and super strong sales volume and prices have already stabilized for 24 months and then headed up year over year for the past 6 months, foreclosures have fallen off by 80% and new construction has been non existant compared to past years it is clear there will be a shortage of inventory going forward and worse come next April when the backlog of lee counties foreclosures have worked through the system.

In June the avg foreclosure sale was 69k the avg short sale was 84k and the avg traditional sale was $148k. So it is easy to see if there are less foreclosures and short sales as a total percent of sales it won't take long for the median to jump quickly. You don't need national experts unless you are looking to buy a house somewhere else in the country. I will openly debate any "expert" you put in front of me regarding lee county. But I think you would be hard pressed to have someone look at the data points and not draw the same conclusions I have come up with.

Yes that is what I meant in regards of the US is a large country and what is true for one area is not true for another. the Real Estate Market in Lee County (and also Collier County) is recovering and we are No. 2 in the Nation in regards of recovery.

[justNancy]

Is this thread still active?

Bottom line is what newspapers/articles you read.

Example:

[URL="http://www.ocregister.com/articles/nation-305074-san-worst.html"]Nation's Worst Housing Markets[/URL]

"The next worst performing markets? Detroit (down 37.4% from 2003), Phoenix (down 29.6%) and Cape Coral-Fort Myers, Fla. (which saw prices shoot up 109%, only to fall back down 28.3% from where it began).

But this one says things are getting better.

[URL="http://www.marketwatch.com/story/5-house-markets-with-best-worst-outlook-next-year-2011-06-20"]Some Hard-hit Markets May Be on Slow Path to Recovery[/URL]

"Examples are places like Phoenix or Cape Coral, Fla. Many of these markets are better now because the housing supply has drastically fallen,”

[hiknapster]

Yep! This very much reminds me of back BEFORE the crash. The pundits were all over the place. One would say the bubble is going to pop, the next one, there is no bubble, and on and on it went.

Like I've said before, there is no sign on the road that says "Now is the time to buy!" as well as one that will pop up and say, "Sell! Sell now! Hurry!"

That's what makes some investors very good at what they do. The rest are just hacks. And of the good investors half of those have dumb luck.

The trick is to stay on top of the trends and stats, almost day-by-day, have boots on the ground and a very reliable feeling in your gut. Even then you could lose everything. Life has a way of throwing things at you that you could never see coming, good and bad.

Originally Posted by justNancy

Is this thread still active?

Bottom line is what newspapers/articles you read.

Example:

Nation's Worst Housing Markets

"The next worst performing markets? Detroit (down 37.4% from 2003), Phoenix (down 29.6%) and Cape Coral-Fort Myers, Fla. (which saw prices shoot up 109%, only to fall back down 28.3% from where it began).

But this one says things are getting better.

Some Hard-hit Markets May Be on Slow Path to Recovery

"Examples are places like Phoenix or Cape Coral, Fla. Many of these markets are better now because the housing supply has drastically fallen,”

[nhkev]

Originally Posted by justNancy

Is this thread still active?

Bottom line is what newspapers/articles you read.

Example:

Nation's Worst Housing Markets

"The next worst performing markets? Detroit (down 37.4% from 2003), Phoenix (down 29.6%) and Cape Coral-Fort Myers, Fla. (which saw prices shoot up 109%, only to fall back down 28.3% from where it began).

But this one says things are getting better.

Some Hard-hit Markets May Be on Slow Path to Recovery

"Examples are places like Phoenix or Cape Coral, Fla. Many of these markets are better now because the housing supply has drastically fallen,”

It doesn't matter what paper you read, they are completly different standpoints. the first one they are comparing one point in time (today) to another point in time (2003) What relevance does that have on anything to do with where prices are going? Why not compare the prices to 1950 or 2010? Whenever there is a specific time something is compared to it very rarely has any relevance to anything happening now or the future.

The 2nd article at least has a reason of what the market is like now and why it's that way "the housing supply has drastically fallen"

My forecasts are always data dependant not opinion dependant. There is so much irrelevant info that is put out there. I have explained this before but real estate starts with location and is followed by supply and demand. to compare one area to a another that has a different location is flawed from the start. 2nd there are some things nationally that do effect every market. such as interest rates, lending standards, foreign exchange rates. supply and demand dicates inventory levels. Levels are either put into buyers market , sellers market, or balanced market. typically categorized of absorbtion rates over 6 months supply , between 4 and 6 months supply, less than 4 months supply. If you see absorbtion rates less than 4 months, have Days on Market less than 120 days, have houses selling at 95% of original asking price it is usually considered a healthy market. Even though Cape Coral meets these I would still not consider it a healthy market untill unemployment is below 8%, foreclosures are selling at a discount of 28% (currently 50% lower). New construction is adding to supply, and distressed sales represent less than 25% of total sales, home values are 85% of replacement costs. This is when I will consider the area recovered and it won't matter how it compared to 2003 or the peak or 2010 it will be what it should be.

[hiknapster]

I am a firm believer in knowing your area. What keeps the area chugging along? Big industry? National headquarters? Vacationers? Farming? Government contracts? What does the economic feeders look like? Is the industry healthy? What about the corporation? Agriculture? There are a million variables but if you are in the area you have a much better chance of getting word on the street.

And another huge factor to consider is the history. How has the area traditionally performed? Is any of that about to change?

A one-off is no way to hedge your bets. Look at what the area has done for decades. Unless Pratt and Whitney is going to start a jet engine plant in Immokolee or baby boomers are going to show up with fat pensions, things might stay they way they have always been.

And while we are on the subject of pensions, does anyone else notice that the people that hope the fat pensioners arrive are the same people that don't believe in fat pensions? Unless it is themselves with the fat pension, of course.

Just thinking out-loud.