Like John, I get contacted daily by prospects looking to buy real estate in Florida. John works the Fort Lauderdale real estate market, while I work the Sarasota real estate market, but I am sure the same misconceptions exist in both areas. There are many misconceptions about Florida real estate but two stand out – nothing is selling in Florida and you can steal property here.
1) Nothing is selling in Florida
This is far from the truth. Like Sarasota, other areas of Florida are selling well. As prices have declined from the highs of 2005, buyers are leaving the sidelines and jumping in the pool. While still higher than normal, inventory levels have been dropping and properties have been selling. According to the Sarasota MLS, so far this year there have been 4,903 sales and there are another 2,204 properties under contract. This same time last year there were just over 4,200 properties closed.
(Added by John Sabia)
Fort Lauderdale real estate market has also improved significantly.
So far this year, according to the Fort Lauderdale MLS, there have been a total of 2,336 sales for both single family and condominium/townhomes in the greater Fort Lauderdale area; including Oakland Park, Lauderdale By the Sea, Sea Ranch Lakes and Wilton Manors.
Total single family and condominium sales for same period in 2008 were 1,776.
Presently, there are a total of 836 properties pending a sale.
(continue with Marc)
I don’t want to paint the picture that Florida is out of the woods because it is not. Overall, we still have too many properties for sale and there is a downward pressure on price. There also is the possibility of more foreclosures which will have to be absorbed as well. However, there are properties selling and a properly priced home or condo for sale will get action.
2) You can steal property in Florida
This misconception has some validity to it. There are properties selling in Florida for half or more of what they used to sell for. For example, I just saw a home sell recently for $680,000 that sold back in 2005 for $1,350,000. Compared to where prices were in 2005 buyers can steal property in Florida.
However, there is still the misconception that you can expect to get 25%-50% off the list price of a properly priced property. That is not true. In Sarasota, on average, single family homes are selling for 93% of list price and condominiums are selling for 91% of the list price. This goes to show that a home priced stands a good chance of selling within 5-10% of the list price. So many buyers are under the impression that you can get another 25%-50% discount from the list price. Of course, there is the rare occurrence that it does happen but usually it just means the seller sold the property for around market value or what it would appraise for anyway.
Often times, the seller has an unrealistic price tag on the property. In this case the seller needs time to realize that. A buyer can be right about the homes value and make a realistic offer only to be turned down by the seller and his impractical views. Not much can be done about this until the seller wises up and lowers price or takes property off the market. It is a fairly common occurrence.
If you wanted to relocate to Florida or own a vacation home here I do believe this is a good time to start your search. This is a great time to purchase a property for you to own and enjoy for many years.
Marc Rasmussen
Sarasota Homes For Sale
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