Orlando vs So Florida depreciation-high end (Lake Mary, Celebration: sales, real estate, foreclosure)

[bostontoorlando]

I'll be moving to Orlando in late summer; I'm looking for a home in the 6000-7000sf range on about 1 acre in a gated community with amenities such as tennis. I've been watching listings and sales over the last 3-4 months and I see pretty high list prices and very few sales in the 1.5 -2.5million dollar range. Many of these houses have appreciated 70-90% the last five years- way more than we saw in the Northeast (more in the range of 10-20%). Some say the high end would not drop much but these houses are not selling.

Any sense of what would be reasonable for offers? Some have suggested focusing on homes older than 2002 when prices were reasonable and making bids for what the price may have been in 2005. Any sense of relative demand for areas like Windermere versus Alaqua/Lake Mary? I went to a neighborhood Estates at Lake Butler Sound and the houses were lovely but in the current economic climate I couldn't imagine that those were remotely good buys.
thanks!

[Silence Dogood]

Nobody is buying those homes, ask for slightly more than they paid if they bought it after 2000 and you should get it. People are coming down 100's of thousands off asking on high end homes.

[bostontoorlando]

Thanks SD, I hope to find a good deal on a house that someone actually needs to sell and that bought before the huge bubble run-up. I wonder how the folks and builders that bought/built in 2006/2007 are going to sell at anything but a loss- buyers aren't fools and there is no denying the oversupply and poor demand that define a sinking market. The real estate agents tell me that at the high end people just hold on to the homes until the market improves, but that could be years. I know that when we move from Boston, we have to sell our house as do most people even in the upper price ranges. If any agents out there know of promising prospects feel free to PM.
thanks
BTO

[Mountaingirl67]

FYI, I rented a house that the person couldn't sell at 100K less than he paid in 2006. That projects to 500K difference in your price range.

[GregTraub]

Well, I wish I could tell you more than what other agents have told you, but it's true that in those higher price ranges, there isn't near as much pressure on the sellers to start lowering prices dramatically. They have the financial fortitude to not care if the home sells quickly or not. So while the Supply and Demand lines are all out of whack, this doesn't necessarily mean prices will drop like they have in the lower price ranges. The main reason for much of the price drops of recent have been foreclosure and pre-foreclosure property that is much less prevalent in the upper price ranges.

That being said, you can always find good deals, and many sellers in this range will simply list high and expect to accept an offer for 100K's less. There are also quite a few New home builders in the Windermere area that are offering the best deals. They don't have pride or emotion involved in the sale and are only looking at the bottom line, usually understand the supply and demand situation and price accordingly.

I also think it could take years for the supply and demand to equal out in that upper price range, especially since the majority of the market isn't lowering prices as quickly as they should. Of course time is the great equalizer, sellers may say they are in no rush to sell today, but after 1 2 or 3 years go by, eventually everyone comes to realize reality. There is no harm in putting in an offer under asking, and a good agent can usually get some kind of indication of whether a "low ball" has a chance or not at all.

The key right now is to just find the houses that look like a good fit, and then find the seller that is realistic and actually motivated to sell today. There's no point in wasting time on overpriced property.

As far as differences in demand between Lake Mary and Windermere, I have personally seen more interest in the Windermere area, but only by a small margin. There are many more homes in the Windermere/Dr. Phillips area available in that price range with about a 10-15% absorption rate over the past 6 months. Lake Mary area is roughly at the same clip of 15%. The main difference between the two area's being the Chains of lakes in and around windermere causing the whole area to have many more high end homes than LM.

Winter park is also a hotspot for that price range that also has not seen any significant price drop over the past 3 years.

[luvthatmouse]

Homes in the 1 million+ range are still selling very well in Celebration-go figure. The Mean and Median average Sold price was 94% of the List price the past few months.

[GregTraub]

Overall SP to LP is about 95% in all price ranges around Central Florida.

All depends on where that List Price is. Some overpriced home actually sell....for 80-90% of their listed price, and some underpriced homes sell for over 100% of list price. Everything is relative to the magical "Market Value" that is so elusive.

It's the Time on Market that I think most think of when considering if anything is selling well.