J. Kretchmar, Both Buyer and Seller in Texas

Is the Ft. Lauderdale residential housing market likely to continue falling or has it reached the basement?

Asked by J. Kretchmar, Texas Thu Feb 19, 2009

Am relocating there (Davie-vicinity of NSU) and wondering if I should buy (obviouslly there's tons of 'bargains") now, or rent for a year to see if there are better deals coming...last thing one needs now it to buy and then lose value, since I'm gonna take a hit already on the home I'm selling when I relocate.

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8
Who told you the market was still falling? Sales prices for single family homes in Broward County for 2009 have been holding their own in most neighborhoods. Condo prices are still slipping, and it is also true that some newer condo complexes are TRAIN WRECKS where everyone is upside down! When you buy a condo, you don't just buy the unit, you buy into the complex, so those must be evaluated on a case by case basis. Use extreme caution and the services of a local full time professional before you buy a condo in south Florida.

Back to single family homes. The average sale price for a single family home in Broward County for January was $254,000. In June? $267,000. Every month in between had an average in the range of $243,000 to $290,000. Doesn't look like much of a "buyer's market" or "falling prices" does it?

Most buyers are finding at this point that much of what remains for sale is literally "the leftovers". About 70% of what is on the market right now is Overpriced Crap. It's never going to sell. Those sellers are gradually taking their homes off the market as their listings expire. About 10% of what is coming on the market now are sellers that are priced REALISTICALLY when they hit the market. Those homes sell VERY quickly, VERY close to the asking price in a matter of DAYS. The section in between sellers that have to do one or more price adjustments before selling are staying on the market 120 days or longer.

I do agree with the former postings that stated if you are going to buy you need to be thinking LONG TERM. If there is a good possibility you are going to move again in three years or less, don't even think about buying. Just rent and make do with what you find.

If you are willing to stay in the next home for much longer, say 5 to 10 years, then your choices are probably ALREADY much lower than you realize. It will become apparent when you really start looking at homes and trudging through the "overpriced crap" I mentioned.

Also, something no one else has mentioned. If interest rates go up ONE PERCENT between now and the time you buy, you would end up paying 10% MORE in payments, even if the price was exactly the same as what you found today. Food for thought.

When it comes to real estate, think practical, think long term, and think about the REAL reasons people traditionally bought homes. Freedom to decorate, entertain, stability, and no landlord dictating your choices.

Let me know if I can help in any way.

Barry Dunn
Keller Williams Realty Professionals
3696 N Federal Hwy STE 101
Fort Lauderdale, FL 33308
0 votes Thank Flag Link Wed Aug 5, 2009
Update - I finally did buy after renting for awhile. By doing so, I was able to find the right property at the right price and saved $100,000 over what it would have been 3 years ago, and $50,000 over what it would have been last year. However, I intend to stay in it for a long time, and I am satisfied with the price I paid. If I tried to resell it tomorrow, it would probably still be a loser. The market shakeout is not over yet.
0 votes Thank Flag Link Sun Jul 5, 2009
If we had the exact answer, we'd all be rich. In this market, the money is made up front. I'd rent month to month, then buy a great deal.

Jeff Holloway
Dania Beach, Fl
0 votes Thank Flag Link Thu Apr 9, 2009
Much would depend on how long you are likely to stay in your new place. Less than five years - forget about it, unless you find something at a real bargain basement price. Interest rate resets on existing mortgages, job losses, and a very large shadow "for sale" market, as well as new construction still finishing will continue to add to price pressure.

More on the shadow market - there are many, many places that are theoretically for sale, but not listed. The owners are waiting for better times, which will not be any time soon. The only question is - how long can they hold out before being forced to sell?

While the stimulus credit and low mortgage rates are appealing, they are only worth obtaining if you plan on being in place for the long term - say ten years.

Just remember, the real estate pros tried to sell you property all the way up, and all the way down. Even Warren Buffet admitted he bought too early and suffered significant losses. This recession has far to go, and when it stops going down, prices are apt to rise very slowly for the first few years, thus preventing you from recovering your acquisition and sale costs.
0 votes Thank Flag Link Sun Mar 1, 2009
J.
I will say as the others have, that right now interest rates are very low, and you can get a great deal on a home. Prices may come down a bit, but right now they are at a level that we haven't seen in years, and the interst rates make it all the more attractive. It's a chance you take, but if you are buying a home to live in it a few years you really can't go wrong. Once things turn around it tends to happen quite fast, and if you are in a rental with a lease, you could miss the bottom at that time.

I would recommend that you investigate some different neighborhoods and decide what areas you would be interested in. Then you can make an informed decision on value and see if you want to wait or not.

I specialize in the Davie, Cooper City, Weston areas, and would be glad to send you property bochures.It would help you get to know the area and specifically the neighborhoods in your desired area.

Please let me know if I can be of any help to you.

Good luck!
Stefanie Cohen
Prudential Florida Realty
954-547-9203
Scohen77@aol.com
0 votes Thank Flag Link Thu Feb 19, 2009
Dear J: Many experts disagree as to whether home prices have "bottomed out". As long as there is an imbalance between buyers and sellers, there are forces exerted on home prices that push them downward. That is still going on in Broward County, in Florida, and across the nation as a whole, and it is quite probable that prices will continue to fall until an equilibrium is reached between buyers and sellers. The new measures announced by President Obama yesterday, were designed to invigorate the housing market, but it remains to be seen how quickly these stimuli will take effect. An article I read today quoted the analyst from the FDIC to suggest that the effects will begin to take hold in April.

Even if prices should continue to fall over the near term, the confluence of housing prices and mortgage rates is especially attractive right now. A prospective buyer could wait for home prices to fall, only to find that mortgage rates were considerably higher when the bottom for prices is finally reached. You will have to consider whether trying to time the price market is worth the potential of mistiming the mortgage market. Right now, with the ongoing world-wide banking and lending crisis, mortgage applicants are experiencing extremely conservative underwriting analysis, and lengthy approval timelines. A buyer who is looking to buy today, may face several months of delay. If you are ready to buy now, I would encourage you to begin the mortgage application process immediately.

Right now, there are a good number of very attractive home buying opportunities throughout Broward County. Many properties are selling for hundreds of thousands of dollars less than they would have sold for as little as 2 or 3 years ago. Even if you felt that home prices might continue to fall across the board, there are still houses that present an outstanding financial opportunity today. If you are moving to Broward County with the intention of making this are a permanent home, I would definitely encourage you to investigate the current market, in order to see whether the "house of your dreams" is available at a reasonable price today. If you don't find anything that you're looking for, then it might make sense to hold off for another year, so that you can re-visit the market and an all new inventory in 10-12 months time. There are certainly no reasons I can think of not to even look at the available housing stock right now.

I hope this information helped you. If I can be of any additional assistance in answering your questions, or in helping you with your home search, please do not hesitate to let me know.

Very best of luck with your new job.

Angela
Villa G Realty, Inc.
Tel: 954-816-7996
Web Reference: http://www.villagrealty.com
0 votes Thank Flag Link Thu Feb 19, 2009
Hi J. Kretchmar:
You have a very valid question! My thoughts along with many advisors in investment say that now has never been a better time to buy. With interest rates the lowest in a long time (4.9%) and prices at basement bargin prices. If you need further help or would like me to send you listings in Davie, I would be very happy to do that for you.
Judy
0 votes Thank Flag Link Thu Feb 19, 2009
It is likely to continue to fall. You can probably find a great rental deal and take your time.
0 votes Thank Flag Link Thu Feb 19, 2009
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