Second-home sales dip reflects national trend
By Tom Bayles Sarasota Herald Tribune
Published: Tuesday, March 31, 2009 at 1:00 a.m.
Sales of vacation and investment homes -- traditionally a key component of the real estate business in Southwest Florida -- slid 22 percent across the nation last year, a sign of the deep recession and of tight credit.
The National Association of Realtors reported that sales of second homes comprised 30 percent of the entire housing market last year, down from a peak of 40 percent in 2005, at the height of the housing boom and when loans were plentiful.
Florida and the South remained the undisputed leader geographically in second-home purchases, accounting for 45 percent of vacation homes sales and 40 percent of investment properties, the NAR report showed.
But Southwest Florida has been no exception in seeing a drop in sales of those properties.
Of the 12 home sales pending for Realtor Tammy Garner, only two are second homes, which has not been typical amount during Garner's 18-year tenure in the region.
"What's selling right now are primary homes because of the financing that is available right now for primary homes," said Garner, who works for Michael Saunders & Co. "In season, I typically have more second home and vacation home buyers, but the reality is unless they get an exceptional value they get on the plane and leave and try and find an exceptional value the next year."
Things are looking better for some in 2009, said Carla Rayman, who heads up the international sales division at Sarasota's Prudential Palms Realty.
"We are starting to see an uptick in the market in people either coming over to investigate -- to look and/or buy," Rayman said. "I wouldn't say we've released the floodgates, but our area is starting to see some investment in second and vacation homes."
Buyers are interested in properties at all price points, but the $300,000-and-under market is where most investors are looking, she said.
Even the big drop in mortgage rates of the last several months has not yet sparked a significant rebound, said Geoff Allison of Bradenton's Gulf Atlantic Mortgage.
"We're down significantly," Allison said. "Second home purchases have dried up and investment-homes purchases are gone, too, even with the interest rates down where they are."
The National Association of Realtors found that wealth and age are strong factors in second home sales. Nearly half of vacation home buyers and two-fifths of investment home buyers had a household income of more than $100,000. The median age for vacation home buyers was 46, nine years older than buyers of primary homes.
Cash played a big role in second home deals. Forty percent of people who bought investment homes told the Realtors group that they did so with cash; it was 30 percent with vacation home buyers.
Overall, second home sales dropped from about 2.09 million in 2007 to 1.63 million last year. Vacation home sales dropped 31 percent to 512,000, while sales of investment properties fell 17 percent to 1.12 million.
Deeply discounted foreclosures and home builders' efforts to unload inventory led median sales prices of vacation homes and investment properties to drop 23 percent and 28 percent respectively.
The median sales price of vacation homes fell to $150,000. Sales prices of investment properties dropped to $108,000.
"As in the market for primary residences, it appears that many sales of deeply discounted distressed homes are pulling down the median price in the second-home market," said Lawrence Yun, the Realtors group's chief economist.
After the South, the highest percentage of vacation homes were in the West, the Northeast and the Midwest.
The report suggested that future demand for second homes might be waning. Asked if they were very or somewhat likely to buy a vacation home within the next two years, 30 percent of respondents said yes. That was down from 44 percent in the previous year's survey.
The 2008 report also showed that 46 percent of investment buyers said they were likely to buy within two years, down from 57 percent the year before.
Information from the Associated Press was used in this report.
Tuesday, March 31, 2009
Wednesday, March 25, 2009
Home Sales Up, Prices Down
SAR STATS
Pending sales in the Sarasota area in February reached 782, the highest levels since April 2006, according to the Sarasota Association of Realtors. In January, there were 683 pending sales. In February 2008, there were 654. But the median sales price for single-family homes in February declined to $142,000 from $149,950 the prior month. Officials said the lowered median was likely because of a high percentage of short sales and foreclosure sales.
Pending sales in the Sarasota area in February reached 782, the highest levels since April 2006, according to the Sarasota Association of Realtors. In January, there were 683 pending sales. In February 2008, there were 654. But the median sales price for single-family homes in February declined to $142,000 from $149,950 the prior month. Officials said the lowered median was likely because of a high percentage of short sales and foreclosure sales.
Monday, March 23, 2009
Key Concierge Opens Concierge Sarasota
Longboat Key-based Key Concierge, a home watch and property management company, has opened a Concierge Sarasota division that plans to provide comprehensive services to individuals and groups. Concierge Sarasota is partnered with the Sarasota Association of Realtors. Susan Robinson is president of both companies.
Contact us and we will be happy to put you in touch.
941-993-6443 or 1888-755-2637
Longboat Key-based Key Concierge, a home watch and property management company, has opened a Concierge Sarasota division that plans to provide comprehensive services to individuals and groups. Concierge Sarasota is partnered with the Sarasota Association of Realtors. Susan Robinson is president of both companies.
Contact us and we will be happy to put you in touch.
941-993-6443 or 1888-755-2637
Thursday, March 12, 2009
Mortgage News
FIRST TIME HOMEBUYER CREDIT - 6 THINGS TO KNOW....
First time homebuyers who purchase a home by 12/01/2009, may be eligible for a generous 2009 tax credit!
1. First time homebuyer is someone who hasn't owned a principal residence for 3 years before buying a house.
2. The tax credit is equivalent to 10% of the purchase price of the home, capped at $8,000.00.
3. Only those who purchase a home between 1/1/2009 and 12/01/2009 are eligible for the credit.
4. Single buyers need a modified adjusted gross income of $75,000 or less to qualify for the full credit ($150,000 for married couples).
Those earning more than these thresholds may be eligible for reduced credits.
5. Because the tax credit is refundable, qualified buyers can take advantage of it even if they don't have much tax liability.
6. Buyers who own their home for at least 3 years do not have to repay the tax credit once the home is sold. If they sell the home before then,
they will have to return the credit to the government (exceptions for certain cases, such as death or divorce).
Now more than ever is the time to buy.....If you are not a first time homebuyer, please pass this on to someone who is!
First time homebuyers who purchase a home by 12/01/2009, may be eligible for a generous 2009 tax credit!
1. First time homebuyer is someone who hasn't owned a principal residence for 3 years before buying a house.
2. The tax credit is equivalent to 10% of the purchase price of the home, capped at $8,000.00.
3. Only those who purchase a home between 1/1/2009 and 12/01/2009 are eligible for the credit.
4. Single buyers need a modified adjusted gross income of $75,000 or less to qualify for the full credit ($150,000 for married couples).
Those earning more than these thresholds may be eligible for reduced credits.
5. Because the tax credit is refundable, qualified buyers can take advantage of it even if they don't have much tax liability.
6. Buyers who own their home for at least 3 years do not have to repay the tax credit once the home is sold. If they sell the home before then,
they will have to return the credit to the government (exceptions for certain cases, such as death or divorce).
Now more than ever is the time to buy.....If you are not a first time homebuyer, please pass this on to someone who is!
Sunday, March 08, 2009
Tax cuts could finally fall on snowbirds
Todays Herald Tribune
By DOUG SWORD
Property taxes will drop by more than $300 million this year in Southwest Florida, but much of that will go to snowbirds as the recession flips Florida's property tax system and its goal of providing tax relief to residents.
Meanwhile, taxes will go up slightly for full-time residents even if cash-strapped local governments resist raising tax rates. And if an expected state-mandated increase in tax rates to pay for schools occurs, as it has in past years, taxes on locals might go up substantially.
Southwest Florida continues to see the biggest decline in real estate values, according to a new estimate by state economists. Manatee, Sarasota and Charlotte counties will shed a total of $22 billion in property value from their tax bases this year, a 21 percent decline. That is double what the same state economists were predicting just three months ago.
Of the seven counties with the biggest percentage declines in property values this year, state economists say, five of them -- Manatee, Sarasota, Charlotte, Lee and Collier -- are in Southwest Florida.
After two years of cutting, it will be difficult for some local governments to resist raising tax rates, despite the political fallout, said Sean Snaith, director of the Institute for Economic Competitiveness at the University of Central Florida.
"There's two ways to close a budget gap: There's cutting spending or raising revenues," he said. "And a lot of cutting has already taken place." Some governments have "clearly cut to the bone," Snaith said.
Raising tax rates in a recession, even under dire conditions, is dangerous. Two Charlotte County commissioners were voted out of office after voting to raise tax rates last year by 25 percent.
But based on the new estimates, Charlotte County will be the hardest hit among Florida's 67 counties. Since 2007, declining real estate prices have cut the county's tax base by 37 percent. Sarasota County ranks fourth.
Although the new estimate would put a $39 million hole in its budget next year, Sarasota County is not considering raising tax rates, said County Administrator Jim Ley.
Last year the county began balancing its budget by dipping into reserves set aside during the boom. It has also cut 220 jobs and is set to lay off 20 or so more.
"Our general approach is you don't raise property taxes in these tough times," Ley said.
Raising other revenues is another matter, said Ley, noting that he planned to reintroduce the possibilities of taxing electric service and instituting paid beach parking. Both ideas have been nixed by commissioners before, although Ley said he would "face the firing squad" again and propose them because of the size of the county's shortfall.
There is a coming clash between politics and the real estate market.
Southwest Florida politicians are generally more conservative and more reluctant to raise taxes than those elsewhere in the state, Ley said.
"Last year you saw a trend toward some local governments moving toward millage increases, and I think you'll see more this year," Ley said.
In the unlikely scenario that there are no tax increases, even for schools, the tax cuts for a home owned by a part-time resident would be impressive.
In Bradenton, the owner of a home worth $150,000 last year and reappraised at 20 percent less would get a $565 tax cut. Twenty percent is the average decline for Manatee County, according to the state estimate.
In unincorporated areas the cuts would be $454 in Manatee, $521 in Charlotte and $369 in Sarasota County.
But residents with the Save Our Homes exemption would actually see an increase. So long as a home's value is under the market value, Save Our Homes limits the annual increase in a property's taxable value to 3 percent or the inflation rate, whichever is lower. Inflation virtually disappeared last year.
If tax rates remain flat, full-time residents in the three counties who owned homes taxed at $150,000 last year would see increases of $2 to $3.
The economists' new prediction drew criticism in Manatee County, where officials believe the estimate that the tax base will drop 20 percent is way off.
"We're not even going to be down 20 percent in market values," said Dale Friedley, an analyst in the Manatee County Property Appraiser's office, who thinks the county will probably lose about 12 percent of its tax base.
Half the county's property value is in the hands of full-time residents and 14 percent is businesses, which will see only modest declines, Friedley said.
If tax rates do not change, that would mean most of the estimated $100 million in tax cuts in Manatee County would go to a group that has long gotten the short end of the property tax stick.
Snowbirds.
By DOUG SWORD
Property taxes will drop by more than $300 million this year in Southwest Florida, but much of that will go to snowbirds as the recession flips Florida's property tax system and its goal of providing tax relief to residents.
Meanwhile, taxes will go up slightly for full-time residents even if cash-strapped local governments resist raising tax rates. And if an expected state-mandated increase in tax rates to pay for schools occurs, as it has in past years, taxes on locals might go up substantially.
Southwest Florida continues to see the biggest decline in real estate values, according to a new estimate by state economists. Manatee, Sarasota and Charlotte counties will shed a total of $22 billion in property value from their tax bases this year, a 21 percent decline. That is double what the same state economists were predicting just three months ago.
Of the seven counties with the biggest percentage declines in property values this year, state economists say, five of them -- Manatee, Sarasota, Charlotte, Lee and Collier -- are in Southwest Florida.
After two years of cutting, it will be difficult for some local governments to resist raising tax rates, despite the political fallout, said Sean Snaith, director of the Institute for Economic Competitiveness at the University of Central Florida.
"There's two ways to close a budget gap: There's cutting spending or raising revenues," he said. "And a lot of cutting has already taken place." Some governments have "clearly cut to the bone," Snaith said.
Raising tax rates in a recession, even under dire conditions, is dangerous. Two Charlotte County commissioners were voted out of office after voting to raise tax rates last year by 25 percent.
But based on the new estimates, Charlotte County will be the hardest hit among Florida's 67 counties. Since 2007, declining real estate prices have cut the county's tax base by 37 percent. Sarasota County ranks fourth.
Although the new estimate would put a $39 million hole in its budget next year, Sarasota County is not considering raising tax rates, said County Administrator Jim Ley.
Last year the county began balancing its budget by dipping into reserves set aside during the boom. It has also cut 220 jobs and is set to lay off 20 or so more.
"Our general approach is you don't raise property taxes in these tough times," Ley said.
Raising other revenues is another matter, said Ley, noting that he planned to reintroduce the possibilities of taxing electric service and instituting paid beach parking. Both ideas have been nixed by commissioners before, although Ley said he would "face the firing squad" again and propose them because of the size of the county's shortfall.
There is a coming clash between politics and the real estate market.
Southwest Florida politicians are generally more conservative and more reluctant to raise taxes than those elsewhere in the state, Ley said.
"Last year you saw a trend toward some local governments moving toward millage increases, and I think you'll see more this year," Ley said.
In the unlikely scenario that there are no tax increases, even for schools, the tax cuts for a home owned by a part-time resident would be impressive.
In Bradenton, the owner of a home worth $150,000 last year and reappraised at 20 percent less would get a $565 tax cut. Twenty percent is the average decline for Manatee County, according to the state estimate.
In unincorporated areas the cuts would be $454 in Manatee, $521 in Charlotte and $369 in Sarasota County.
But residents with the Save Our Homes exemption would actually see an increase. So long as a home's value is under the market value, Save Our Homes limits the annual increase in a property's taxable value to 3 percent or the inflation rate, whichever is lower. Inflation virtually disappeared last year.
If tax rates remain flat, full-time residents in the three counties who owned homes taxed at $150,000 last year would see increases of $2 to $3.
The economists' new prediction drew criticism in Manatee County, where officials believe the estimate that the tax base will drop 20 percent is way off.
"We're not even going to be down 20 percent in market values," said Dale Friedley, an analyst in the Manatee County Property Appraiser's office, who thinks the county will probably lose about 12 percent of its tax base.
Half the county's property value is in the hands of full-time residents and 14 percent is businesses, which will see only modest declines, Friedley said.
If tax rates do not change, that would mean most of the estimated $100 million in tax cuts in Manatee County would go to a group that has long gotten the short end of the property tax stick.
Snowbirds.
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