Is Florida housing a bubble? One economist says no...

That report is an excellent read.

I still disagree on some parts though. I live in the Tampa metro area and know that many jobs created here are not the high paying ones. Call center jobs---$40k a year. Not horrible, but it's a stretch to afford a $250k house on that kind of salary, espeically once interest rates rise back to historical norms.

Other factors including communting times, lack of career opportunities, and spraw (yes it's happening here as well) may cause some urban professionals (yuppies) to move back up north. I am one of those yuppies, and the price increases on everything from housing to insurance is enough to make me want to say "enough is enough" and get a better paying job with better opportunities up north. Winters might be colder but the wallet will be fuller.

But this argument suggests it is a bubble because once construction catches up with demand, and there is no reason to expect supply not to catch up with demand eventually though it could take a recession to do so, prices could fall.

I don't think the housing bubble will burst in Florida. Too many people want to move there. A lot of baby boomers from the north and people from Europe have the money to buy at peak prices, as the dollar continues to slide.
There may be a slow down and a slight decrease in value but there won't be a crash. Florida is too popular with a lot of people wanting to retire there

Chris:

I don't understand your comment. You think that people will want to move to FL and live in a subdivision once they retire?

I think FL is going to slow down - as more poeple move here and turn the "new south" into the north it will lose all of it's allure except the weather - and the way it looks, hurricanes are doing a good job of making the weather look crappy.

I thought the dollar was rising as well.

Just sold my house for 480k, i built it for 150k. My taxes are 3k the person buying my house will pay about 8k to 9k. My house insurance has more than double. The new owner got a estimate of 2k. Ten thousand dollars is quite a bit on money for taxes and insurance. I am taking my profit to smith lake in alabama. Taxes 400 dollars a year, for a bigger house with 2 car garage and a guest house, with a pavillion. 3 acre's of land, 535 ft of water frontage. Its the third cleanest lake in the country. As soon as people start getting their new tax and insurance bills, they will wake up. Home inventories are rising, that means only one thing to me, prices will go down. Its already starting in some markets. There are plenty of places that are nicer than florida, you just have to look around.

The dollar has been rising for months, so are interest rates, taxes, house insurance, fpl bills are up too. Hurricanes are starting to get on people's nerves also. Florida better do something about their tax system. People will get sick of paying huge tax bills.

As a young professional living in South Florida I can attest to the fact that the housing market is OUT OF CONTROL. While everyone is reveling in the obscene amounts of money they've made selling their first home or buying expensive one named condos like zenith or pinnacle I think we're all overlooking one very important fact...who's going to work? If anyone honestly believes that the baby boomer retirees and South American and European vactioners want to work they are sorely mistaken. When people with advanced degrees can barely find a job paying enough to move out of their parents homes they begin to look at other areas o relocate to alt

As a young professional living in South Florida I can attest to the fact that the housing market is OUT OF CONTROL. While everyone is reveling in the obscene amounts of money they've made selling their first home or buying expensive one named condos like zenith or pinnacle I think we're all overlooking one very important fact...who's going to work? If anyone honestly believes that the baby boomer retirees and South American and European vactioners want to work they are sorely mistaken. When people with advanced degrees can barely find a job paying enough to move out of their parents homes they begin to look at other areas o relocate to altogether. In the end the talent that ideally would have helped power south florida's workforce may ultimately have to leave in order to afford some quality of life.

The developing has outpaced the infrastructure in the last two years in the outlying Tampa bay area. Condo townhomes of 200 or more being built on six acre lots feeding out to an already crowded single lane road is all too common. The lack of trees has now created an ozone haze this last year and the temperatures are a record high. The lack of emissions testing for the state means plenty of blue smoke sedans puffing in front of you at a grid locked intersection in front of a new mega walmart. Sorry to sound negative but the developers are just too greedy and the county just wants more tax revenue. They claim there are jobs here and that is true if you want to work at a doctors office or a dry cleaners.

Somebody mentioned call center jobs but Capital One just emptied out their newly built campus of all call center jobs and other companies are doing the same. If you don't mind assisting the elderly that might be the only higher paying job other than being a waitress.

My commute in 2002 was fifteen minutes for a ten mile drive. That same one in the fall of 2005 is now 45 minutes to an hour if it rains.

We all are loosing by rising home values if we ever planned on moving within the same market area if the market doesn't tumble back soon. It is a negative to say your house gained 30% last year. The house that you liked a year ago that was only 100k difference in price has increased by 30% too and you must subtract the difference between the two houses to see how this house pulled away from your current homes value. 30% of $200,000 is $60,000. While 30% of
$300,000 is $90,000. You didn't gain a thing you actually lost the difference between the two gains which is $90,000 - $60,000 = $30,000. Plus of course the taxes now are not on a 300,000 house but a 390,000 house. Insurance is higher and interest rates are on there way too. If you do this for two or three years you can see how the house of your dreams keeps pulling further and further out of reach. Enjoy the Equity Boom?? This will collapse on itself as more and more people realize they cannot move unless they want to loose money by paying too much for a home. Your dollar will be considerably weaker then your new neighbor's dollar because you are paying much more for a similar home due to the increase. Your $100 bill might be worth as little as their $50 bill and if you want your hard earned money to be worth less then enjoy the move. This is a market that traps the home owner and depresses the new buyers. It is negative and will not prevail long. The only temporary winners were the investors falsely driving the market higher by taking advantage of the strong rate of returns that were rolling forward due to the new creative home financing, therefore, creating more rate of return as more investors jumped onto the band wagon. This investment pull will decrease and sell out. Fear will be inevitable as interest rates rise and more people realize they do not want to move to purchase these investment properties because the new taxes are not worth the move. It will be the "Trapped Home Buyer Syndrome" that forces the market to crumble. Inventory will increase, these investors will get nervous because no one is willing to pay the new taxes and feel they are moving up enough in the world by spending allot more money for a home that is not much better then the one they are currently living in. People will start making offers. The downfall has begun and it is a good thing. Remember, the larger the number the faster it increases if percentages are constant for both a small number and a large number and the faster they decrease as well. So that home of your dreams may come back to reality faster then your home will fall. Enjoy the Slow Down!

People wake up housing bubble burst not if when. (at least here in Florida). In a nutshell salary 2005=salary 2000, house 2005 = house 2000 x 2. Here is the balance sheet for myself and a lot of middle income folks such as myself. Gross pay 70k me 20k wife. Net pay me after IRS, Social Security, Medicare, 401k(since we no longer get pension and probably not SS in 2040 either) and health care = 40k. Wife = 15k. Bills = 2k per month not including food or gas. House with real mortgage not in ghetto = 220k. Payment at 6 percent real mortgage not buy now bankrupcy later ARM, (with property taxes) 1600 per month.------leaves grand total of 900 dollars a month for food, gas, clothing, recreation, christmas, pet food, you get the point. Folks we make gross 90K per year that is alot compared to average family (AND WE HAVE NO CHILDREN). These numbers are not fudged, sure I have 300 per month student loan + wife 300 month credit card, who doesnt have something like this??

--Bottom line, we can not afford to buy a house in Tampa Florida on gross 90k per year. Many in my neighborhood where I rent, are landscapers, cops, etc.. with ARM loans. Now if we can't afford 220k with 90k gross per year how is the truckdriver neighbor with secretary wife going to make the payment when it is 1600 per month??

--Do the math, its simple really, noone can afford houses soon, noone can sell them, noone can sell them price goes down = bust

--ARM loans 50 dollar a month mortgage payment now (sarcasm) jumps to 1600 per month, average family can not afford it, sells it, every 2nd house on the street is up for sale, what happens to the price? ARM'ers are upside down on loan because they are forced to reduce sale price.

Basically, the real estate market made alot of money for get rich quicker's and and people who bought several years ago, however all good things come to an end. Talk to any realtor, the last couple of years brought a plethera of baby-boomer first time home investors with second/third home investment properties. This is a new variable in the housing market. People with one house will live in it and ride out the bad time, people loosing rapidly on an investment will sell and cut their losses.

--Time to wake up, don't buy the realtor/mortgage broker hype of take out an ARM for 200k now sell for 450k in two years, its just hogwash..

Real Estate in any desirable coastal area will not decrease in value; there is nothing to replace these properties......Thirty two years ago we paid $26,000. for a small house in Belmont Shores, CA - that property now sells for at least 15 times what we paid -

Will the bubble burst soon? For the sake of my community (Naples, FL) I hope it does. Young professionals cannot afford the average housing price of $500K with the few well paying jobs there are here. The school district, fire and Sherriff's departments, and hospitals can't recruit anyone. The same goes for banks, stores, and restaurants - who are constantly hiring - can't find good stable help which in turn creates a lack of quality service. Construction work is abound but there's no one to work which creates ridiculous delays in building homes and infrastructure. All this work is here, and Naples is popular with retirees and the wealthy, but the average worker cannot afford a small house in town at a price which could get you a much larger house with more amenities elsewhere. Most of the affordable housing is in Lehigh Acres or Fort Myers, which are rising in prices as well, and don't have as many jobs as in Naples. Those who make that commute can make it at best in 45 minutes or at worst, with a minor fender bender or during winter season, on an already failed road system, a commute time that can rival the largest of American cities. I for one can tell you that the quality of life down here has been on the downward spiral for more than a few years now.

I don't know what the average person in Tampa Florida will do for housing. My Son is a fireman /paramedic. He can not afford to buy even a condo in this area on his salary. I don't know what a lot of the younger people will do, and the sad thing is what will happen to our Firemen, Police, Teachers, and Nurses when they find they can not afford to live in the area they work in. I think all of us in Tampa will lose!

I made the blunder of moving from Memphis,
TN to Tampa, FL about 18 months ago. It has
been nothing but frustration since. I
honestly have no idea how people can live
down here. I think there are two classes of
people: the ones that beat the wave and the
ones that are drowning in its wake. My
wife and I have decided that we will
continue to rent until something drastic
happens. At the very least we can cut
and run if things continue on this course.

The market in all of South Florida is ridiculous. I make 70+ a year and refuse to pay 200,000+ for those pathetic apartment/condo conversions which is about all you can get for that amount of money. I'll move before I pay the prices they're asking down here. (Palm Beach - Broward area).

Hi, my uncle lived for years in Belmont Shore. He bought a house there on Quincy St for 24 thousand in the 60's. It was where I learned how to swim, in the back bay facing Naples, Ca. It is beautiful, but the price was driven up by the Japanese. Now, of course if a rich person in LA cannot breath the smog and wants the coast, little Belmont Shore may resist price reduction longer than most places. However, if the speculators leave, then it could be subject to severe price drop, which would wash out those who just want to be rich. If you are there for the long term you probably are ok, and I would guess that a lot of homes there are paid for.

I recently moved from Memphis, TN as well the
prices of housing down here are insane St.Petersburg is defently insane 1 bedroom ,1 bath condo downtown area $150,000. The condos on the beach $500,000. I could buy a 3 story ,2 car garage underground pool, tennis and basket ball court with circle drive and natural gas burning lights, on at least 20 to 30 acres of land for what they are asking here! I just wonder what happens when no one buys? I mean the place is great and all but what real attractions are their in St. Petersburg & Tampa? My point is if I'm going to fork out that kind of money why not live at Disney !! It's the happiest place on earth. I can tell you this place sure as H@ll is not . Everyone seems to be from upstate NY. They
have either ridden in a taxi their whole life or
taken the subway ,because they sure don't know how to drive. The place also smells like as which I recall NY did too!!!!
( Welcome to Florida) sunshine state my a@!

just amazing to read the comments yes some are very true indeed'ive been living in florida for 50 years born ans raised.there will a bubble big time like back in the 1970's with townhouse same sinero buy buy than whamo hit bottom.flroida was always based on how much the citizens make until the developers came down from out of state and the mortgages where affordable to the comeon citizen.i think alot of these developers and realiter's nedd to get some florida history.and please dont let these guys fool you into to thinking that it wont. oh by the way have i forgot the high insurance you pay as well.most of the 72% homes in flroida are why over priced and the taxes are the same so buyer bewhare of what you buy and check the history of the home and see for you're self thanks gary

http://www.gtar.org/mlsjan06.pdf

As you can see residential resale's in 2006 are looking great relative to January 2005. Almost the exact same number of sales and contracts were written and closed during January 2005 as January 2006. However, the only difference that I can see is more listings then before were placed on the market. I am not sure if this is a slight panic by the general public to cash out (because they were looking for a slow and December/January always is slower then the rest of the year) but the total sales and contracts suggests there is no reason to list their homes and cash out. However, if the trend continues with people not seeing the stats and listing too much supply will through the demand out of balance and they will create there own slow and allow for low ball offers due to oversupply and false panic. Enjoy the stats.

I moved to Florida a year ago after my brother's house almost tripled in 3 years (New Tampa). house prices are starting to fall as speculators try to dump. It was inevitable, Florida's low personal income level(no economic base here) could never support those prices. Also,only 53% of Fori-tards finish high school, and the average IQ is 72. Since there is no income tax,there is little state government(bad schools, no prisons, shockingly inadequate roads, and no consumer protection of any kind) quality of life is extremely low. The Baby Boomers are moving in already, but then moving out and half-way back home when they see the low quality of life.(the term is "half-backers", according to a northern GA real estate agent I spoke with)(yes me too!)
Due to the Baby Boomer's mis-begotten retirement planning, they know they will have working retirements, but they won't do it for Florida's hardscrabble wages and bubble prices/taxes.
This is Florida's 5th real estate boom/bust, it's not like it hasn't happened before.
Also, car insurance cost is 3X Detroit! (DETROIT!)
Detroit is looking better all the time, crime levels are pretty comparable to here.
And don't even get me going About the NY/Long Islanders

Steve from Detroit, your comments are rather harsh about Florida. My entire family has raised our children here for close to 100 years. I am a nurse, one brother is a Dr. and another brother a career Air Force retiree. Your whole theory on IQ is proved false with my family and I am sure that it is an unfair remark for countless other Floridians. I assure you Detroit needs you far more than we do down here just for the massive welfare/pension gig ya got going in Detroit. The real reason prices are escalating so rapidly is lower interest rates and 1000 people moving here daily....I heard 6000 people move to Orlando a month on average. The demand exceeded the supply.

In general, I'd have to agree with Steve. Pamela's comment just reminds us that there are always exceptions to the rule.

My wife and I currently rent in St. Petersburg. We are a young couple and have been married for 6 years and we have been trying to buy a house ever since. I recently landed a decent job and now between the 2 of us we make about 85K/year. I remember looking at houses 6 years ago for 80K (because that was all that we could afford at the time). This is completely rediculous today. We are looking at 2/2/1 houses in St Pete for 220K+, which equates to almost 2K/month. We have recently started looking up in Pasco county, where at least the houses are reasonably priced 140-170K, but those houses were around 100K 2 years ago. We want a house so bad, but are unsure what to do. We can now afford those houses in Pasco, but the drive down 19 is going to be terrible. I hope the bubble bursts soon. We are finally at a point in our lives where we have paid off ALL of out debt, saved a few thousand, but are basically being driven to another county to find housing that is over priced, but at least affordable. I am so stressed. I just want a decent house at a decent price. Bubble, hey bubble, its time, please burst soon.

Jason, I grew up in St. Petersburg and by the grace of God my husband and I were able to buy a historical home in old NE a decade ago. Sold out five years ago and headed to Parrish to buy land and a home. stayed five years. My husband after selling that retired at 43 and we now live in Brandon. Try Brandon. Great schools and affordable housing with many choices..Another great place is Dade City. We have 60 acres up in the Ocala area now and a fantastic home in Brandon....Do not despair.Please keep trying and keep an open mind about other areas.

Anyone who thinks there isn't a serious bubble in South Florida is either a real estate agent or living in a cave. The baby boomer myth is a joke! Listen, every baby boomer isn't a financially wealthy individual who has sold his or her house up north for a couple million and looks at a 350K home in Florida as a drop in the bucket. The average boomer has struggled his or her whole life to save some money and isn't going to come to Florida, buy half the house for twice the money and get a job to pay the bills. That is NOT retirement.
Currently over 30% of the building going on in Florida is speculation. That is what driving the market along with low interest rates. I have builder friends who tell me that the market is currently double what it should be. That means that a $350k house should actually be priced at 175k according to building costs vs sales price.
Just hold on and things will return to normal. I sold a house on the water that was my dream home for 4 times what I paid for it in '96 and am currently renting until the bubble bursts. At that time I will be happy to buy up foreclosures with the money I have in the bank. Just be patient Florida. Sanity will return

I am a young professional here in Florida and I have been waiting for a couple of years until I could get the financial stability I needed to get into real state. Now I am terrified I don't know if I should buy a condo for $200K or wait and wait and wait as I have been doing until something different happens.. I make a decent salray but I really don't knos if it's worth risking getting into real state at this point. Is a condo from teh mid 80's really worth $200K?

The Real State bubble in Florida is now a Big Trap for everybody. You feel free and ready to purchase a house? Keep waiting about more 1 year and get a good deal.

I grew up in St. Petersburg. I've lived in Los Angeles since 1988. Florida's market is now very simular to Los Angeles's. As a Realtor myself, I do feel both markets are largely over inflated.
I also feel the market will come down over the next several years. When working with buyers I tell them my feelings about the market heading downward. I've advised many clients to wait and see if the market softens. Some clients feel I'm wrong and proceed to buy, which is fine as long as they aren't hoping to flip the property. If the market does turn down, they will be able to ride it out market conditions as long as they don't sell.

I've personally sold my home in Los Angeles and I'm waiting as well, ready to buy once the market softens. Most likely in Florida.

I feel although L.A. is grossly over valued, Florida is at much greater risk, due to many factors, especially income. If you are curious to see what homes are listed for in Los Angeles, go to my site: http://www.SuperHomeSearch.com
Click on Search the MLS - you better be seated, I don't want you fainting at the sight of 2+1 780 square feet fixer bungalows priced at $525,000 !!!

I am a college grad in my late 20's, born and raised in Miami. I CANT for the life of me buy a house or condo without using thise ridiculous ARMS loans. ATTENTION PEOPLE: Baby boomers are not moving down here. Most pre-construction condos and housing are being bought up by speculators. I have a friend that works for a developer and he says that people come in and buy three or four units at one time.... I am just sitting at home living with my parents until the bubble burst and I pray that it will soon. I would love nothing more than to buy a condo on the beach at some crazy reduced price.

Tampa & St. Pete's quality of life wasn't bad in the last 20 years considering low pay but a fair housing market. Now that the housing market has sky rocketed, I'd rather pay for a nice home out of the state of Florida. $200k should buy a home you are proud of, not a Rondo (apartment/condo). If I had to live in a Rondo, commute on streets that can not handle the current traffic flow and drive in a traffic jam for 90 minutes to get to the beach I'd go nuts. While you are waiting for the bubble to burst in Tampa & St. Pete, travel the country and find a new haven to call home (preferably one that hosts a good majority of English speaking citizens). Will the bubble burst or will the 2006 Hurricane Season take care of Pinellas? "First one out is a rotten egg"!

Born and raised Florida Cracker here. Again, 12 of the top 30 metro areas for job growth are currently in Florida. I agree with Rob to drive around the country and find a little slice of harmony elsewhere. There are 3.4 million people headed this way in the next ten years. I believe we call that a Yankee hurricane. Investment opportunities are in the rural areas. Ocala, Wildwood, Micanopy (Sorry guys to let that cat out of the bag) and a host of other small towns.
Florida at this time is a "Red State" and reaps the positives as well as a few negatives (Developers) for their pro growth initiatives. I love my State and am proud to call her my home.

People - Florida real estate is still afforable compare to the west coast. My sister just moved from Miami to Seattle.

Housing prices in Seattle was pretty mellow for the last five years, as the NW economy tend to lag the rest of the country by about three years.

A typical 3 br/1 bath craftsman house in Seattle (in a decent neighborhood) will cost you about $500k. The price increases are starting accelerate as our economy start to really pick up. A 2200 Sq ft new house in the burbs, with 5000 sq ft lot, and 4 br/2 ba will start around $500k. Spend an hour commuting into the city.

Northern California and the LA Area's cost is double of Seattle's.

On that note, I think Tampa is relatively affordable compared to most growing urban areas, especially with the amentities, activities, and job opportunities. Try not to compare the prices to other states where the economy is either stagnant, land is plentiful, or wages are lower.

Bubble? No Way.. NOT EVEN CLOSE. At least not for Miami and the Downtown Condos going up.

Why? The sea of Baby Boomers, The Stong Euro, Wealthy South Americans and Islanders looking for second homes and safe havens and ... MTV, the Media and public perception of Miami. Accurate or not, Miami is sexy, exciting and different. Don't forget warm and sunny year round.

Fear of Huricanes? Not a real factor for new highrise construction.

The Miami skyline is changing so fast if you've not been down in 6 months you won't believe what's going on.

We get calls every day asking about Miami. Outside interest has grown tremendously in Miami. Miami is a magnet .. as I walk the streets you can feel a city growing into it's rightful place in the Global spotlight.

Sure there are nay sayers who caution you to be careful and we've always had the scared and ignorant warnings about the dangers of Miami .. That's all based on ignorance and stupidity. Hell, North florida tries to steal tourism by advertising, "The Other Florida" .. You can read between the lines in those ads. Yes Miami is very diverse.. Yes Miami is different .. Yes, Miami comes with all the problems of big multicultural cities where money and power moves around. But Miami is also surprisingly rich in culture, jobs and history. Miami is inevitable. If you travel frequently and have not been down here, you are probably going out of your way to avoid this great city.

In the next few months the new and Art Center opens. The streets and lots surrounding it look like war torn Iraq with all the buildings being blown up and replaced with grand Skyscrapers. 20,000+ units comign in, many to be purchased by speculators... Reason to be concerned? NO

I was in NYC last week.. condos in the upper west side for 2, 3, 4 million... You can still buy brand new Downtown units with water views for under 500k.

[miami preconstruction condos]
[miami condos for sale]
[miami downtown highrise condos for sale]

For more information:
http://realestate.1stmiami.com/miami_preconstruction_condos.aspx

Wake up and smell the coffee realtors! Quit justifying the prices.

Tampa, Sarasota, Bradenton have homes sitting on the market for months and months. A home that was priced as others similar for 1.2 million in Bradenton has been reduced to $799,900 after six months. It's still $200,00 more than they paid in 2002. Obviously the seller isn't an investor as they aren't concerned about everyone elses property values. They just need to get their money out.

Face reality, the Europeans aren't investing since UK investors have thousands of rentals in Florida. so many rentals make it hard to even cover the cost of their mortgage, taxes and insurance. It was a great investment for the Europeans when they could get a four bedroom house for less than $200K

The prices doubled and tripled due to investors who are now sitting on their houses. Whose going to buy them? I wouldn't want a house that's been sitting empty for a year or more. Shame on the builders for getting greedy too! Of course they have lots of room to lower the prices. David Weekley homes is having Red Tag Sales.

This is just the beginning. The "creative financing" hasn't played a part yet. Give it another year and we will start seeing foreclosures. What about the hurricane insurance? Who can get it let alone afford it?

Comparing Florida to California is ridiculous! California boasts the best climate as well as scenery! As a Floridian, I love Florida, but come on it's not California. California doesn't have the bugs, humidity, constant hurricane evacuations.........

Many of my Yankee neighbors are moving back after only a year or two. Can't take the heat, bugs..... Many are choosing North/South Carolina.

As soon as the realtors face reality and start accepting the decline in the real estate market, the sooner we can get back to a normal market. A home is to live in, it's not the NYSE!

a florida author wrote tongue in cheek that mother nature hasn't finished with Florida yet. he continues that all those high rises on narrow spits of land in Miami, well, they may eventually make good mooring for yachts that visit the flooded lowlands. If the water doesn't drive you out, the taxes/insurance will. $8,000 tax on a $400K house, and $7,500 insurance on a pre-1992 construction home. South Florida is a dream that the American Middle Class has already been denied.

So, where would you recommend for reseasonable priced housing in FL? Or does it exist? Are you seeing prices decreases greatly in Tampa or are the builders just letting the houses sit? What about housing resales- are sellers coming down much on prices yet? How about Jacksonville - housing prices & job opportunities? The high cost of housing in FL is putting us off moving & buying there! Any recommendations on where to relocate in a warm state with decent job opportunituies for 2 MBA's?

You won't see the major drop in Tampa or surrounding areas for another year. The realtors are convincing sellers they will get their prices. The houses are sitting on the market. Only the serious sellers are lowering the price. I would say at least 35% of homes on the market are owned by a realtor or investor. They want to get their money. These houses are sitting empty or have "Castle Keepers" living in them for free rent.

Florida is a great place to live, but unfortunately, the investors have ruined great neighborhoods! Check out Lakewood Ranch in Bradenton. Awesome place to live, work and play. If you go to realtor.com, type in Bradenton zip code 34202, you'll find over 500 homes for sale. The cheapest home is for $349K and is only 1500 sq ft. No yard, no pool..... These are the homes the europeans and northerners were buying for investments. Most of them are empty. The house is actually worth around $150,000. Because the small houses are so pricey the larger homes are even pricier. What you can get for $800K is only a $400K home. 1 million is a $700K......The investors have ruined this wonderful community. Every other house has a for sale sign. Rentals are popping up everywhere.

This is the trend all over Florida. The market is too volatile! I would say, move to Florida. It's awesome. Rent! There are so many rental properties in great areas! You have more to lose than the tax break you get from owning! Don't risk your hard earned money thanks to a bunch of greedy developers and day traders.

Wait for all the creative financing to really hit the fan. Prices will be basement bargain! The salaries are not up to the cost of housing.... When these loans come up, people sitting on their investments will have to bail. People won't be able to make their payments and unfortunately will sell to get out or foreclose. This will effect the more expensive homes too. People who make $200k are living in $1+ million dollar homes. What if they lose their job or have a hardship?

A friend who builds small communities has cpa's for doctors, dentists and other investors come in and try and buy 4 houses at one time. Luckily he has stuck to his guns and wouldn't allow investors. As he says, he builds houses for people to live in! Unfortunately, this has been the case all over Florida and the majority of builders have just worshipped the money god rather than worry about the overall impact on the community they are building.

Jacksonville is way overpriced too! There really isn't an area in Florida that won't be hurt. My preference would be Tampa to relocate. Just don't buy right away. The builders are coming down $30-$50,000. A house in Waterchase, tampa zip code 33626, in 2004 was selling for $400k Now is selling for $700-900K. They encouraged this frenzy by making as much money they could. Now they need to lower their prices more than that. According to many reputable sources, Tampa is anywhere from 30-40% overpriced right now. Not a good time to buy.

Want to move south where it's warmer and have MBA's try Charlotte, NC. Major banking center, great downtown area and housing is unbelievably cheap. Raleigh is also great. However, they are a bit colder in the winter and get more snow. Columbia South carolina, Greenville, SC and many areas in GA are awesome and still relatively cheap. Hurry though, the halfbackers are going to bring up the prices in these areas next.

I am a Florida Realtor/Baby Boomer/Empty Nester who moved here in 2003. At that time Florida Real Estate was a bargain!!...I had cashed in on my high home price in Boston!!...and proceeded to invest in Florida.....Yikes, it was good move!!.....I have since sold all my Real Estate Holdings and Rent a beautiful home for Cheap!!
Why???....A good investor will buy right...then sell right....THE BOOM IS OVER!!!....

Why? Lots to Blame..For One...The Save Our homes Act, causing in my opinion the most unfair property taxes in the country!! ...( Even my Baby Boomer friends in Taxachusetts will no longer move here!)...niether can most Floridians afford to move. Even,into a similar home to the one they currently own. Our legislature is only going to give this a band-aid solution...Sorry Folks..this is killing our market....Wait till this November's Tax Bill comes ...OUCH !! It will be too late by then!!...Most "out of staters" don't know about our property tax problems!!

As a REALTOR , I value my reputation in Florida and tell my buyers (the investors are gone!).....Be careful...! Do not buy a condo/townhome...the price will be(actually is) Falling!!
Single Family, is a safer investment...but only if you treat it "as your home" for the long term...also,if your only going to have a job in Florida for only a few years...Renting Is Best!( get the hint investors...Buy Rental RIETS)

Great Home Buys are now arriving here in Central Florida...the Smart investors are out of the game..the headstrong Investor/Sellers are holding on against hope!!.....The sellers are not going to win this battle ...the laws of economics are taking over...ALSO, the home builders seem to be in trouble...and are releasing the bad news piece meal (maybe trying to save thier stock prices?)
I represent my buyers to get only the best possible price!!
Floridians who have never seen the "low ball offer" ..will have to get used to it!! ( Sorry Sellers)...
While housing bubbles do not Pop (LIKE STOCKS)...they do loose air...
My Advice;...Your Real Estate decision must be for the Long term..."Buy and Hold" five to ten years minimum...Or sell now!!!!! for whatever you can get as quick as you can get it!!

Seller's/Investors take what you can...don't be greedy...your making lots of money( or at least don't loose it by attempting holding on to long for that high price!!)..... Remember the old saying....."In a Fire ...Only the first people to the exits are the ones who survive!!"...............
(Yes ...I always check where the Fire Exits are located in a night club/casino too!! Do You??)

I live in the Bradenton-Sarasota Area. And , you couldn't ask for a nicer climate in the winter, as long as it snows up north, buyers will be here, just wait until the winter of 2006-2007, they will be begging to buy our homes. Yes, it is a buyers market now, but any realtor you talk to said in the past 2 weeks the buyers are really coming out, because they are concerned about the interest rates and as quick as it turned to a buyers market it will turn overnite into a sellers market. Everybody is in real estate to make money, we came down from NJ 13 years ago, and you talk about expensive, our taxes then were higher than they are now, which is about 5 grand. We have the sunshine and it is still less expensive to live here than in NY or CA and a few other states. Everybody I know said moving to Florida was the best decision they ever made. Everybody that complains about Florida's high prices, go somewhere else and complain. Forget about complaining about the hurricanes, every state in this Country has either tornadoes, earthquakes, mud slides, ice storms, blizzards-take your pick. WE LOVE FLORIDA!!!!!!!!!!!

Tricia is right about all of whats going on in Florida right now. We left Manatee county last year to be in Brandon...It is really beautiful in her neck of the woods. People are driving up and down the streets looking for homes again. And another statement about Florida that is true is how quickly the market can and will change back to a sellers market. 1000 people are moving here every day. Our inventory levels can change overnight. And if we experience hurricanes this year,I assure you it will impact us AGAIN positively. It always does.

Tricia and Pam,
Nobody is disputing that Florida isn't a wonderful place to live! Hands down, it's the only place for me! The fact remains that the market has been over valued for the last 2 years! You are probably enjoying the equity in your home. If you've been there 13 years, your house must be worth 2-5X what you paid. Am I jealous, ABSOLUTELY! If you moved houses within the last two years, I feel sorry for you. If you had to move homes today, think about the taxes. Most of my friends are remodeling rather than moving because of the taxes. If you've been in your home for more than three years, you have hurricane insurance and your taxes are low. What some buyers don't know is that a $700,000 home with taxes based on the homeowners purchase price 4 years before for $350,000 will more than double thanks to the higher value of the house, but also the new tax laws.

Fact remains, there are currently 5,332 homes for sale in Bradenton Florida. There are 6,246 rentals in Bradenton. This is just a tiny slice of Florida. What about Sarasota, Venice, Ellenton, Brandon, Lithia....... These areas are over saturated too.

If this is turning into a buyers market, why are there so many empty houses? Oh I know, the public has wised up and knows that Florida realtors have run out of steam. There is still plenty of land to build on. The speculators are losing their shirts. People who were talked into creative financing really can't afford the over valued home they bought. The speculators have ruined beautiful neighborhoods. For Sale and For Rent signs on every other house. Hmmmmmm those people driving around looking are either window shopping until prices drop to a reasonable price or are so rich, they can afford to pay 30-40% too much for their house. the houses I've been watching for 6 months, still haven't sold. Rental homes are dropping their rent too. One house we're looking at renting just posted at $200 less. It's been up for rent for several months. Guess the owner would rather get something than nothing.

We can afford to purchase a home. Our salary is over $300K a year. However, we earned our money the hard way. Working, not day trading. We have no intention of losing any of it in a volatile housing market! Nobody is complaining just stating facts. The behavior in the Florida housing market has been irrational!

WE LOVE FLORIDA TOO!

Guys:

Enjoyed your comments. I am a mortgage broker. I own my own brokerage. I am also a florida homeowner who bought a house dec 30 2005 in palm bay -which is directly across to the atlantic from tampa. Its just outside of Melbourne.

I bought the house for 262k . Its 2000 living sq ft. 4 bed split plan with fantastic master bath . Contcrete block , roll down , installed hurricane shutters, 160 ft out building, 1/4 fenced lot with full supply of inground sprinklers fed from well. We have crown mouldings in the house. double garage with seperate enterance off the wing into the back yard is added bonus too. We also of course have the vaulted ceilings, new roof and well, you get the picture.

Oh yeah, by the way, it also came with a heated inground screened pool that is to boot self cleaning.

life is sure rough here........

well,5 months later, my house is now worth about 290k , and they are trying to hawk similiar houses (without the obvious extras we have) for 299 -to 319k on the MLS.

not bad in an 'overinflated ready to bust market'

As a broker, i deal with purchases , and refis every day. I can tell you this for a fact -as a professional.

35% of all homes in the united states are paid for -there is no mortgage.

another 45% have fixed rate mortgages and thus no pressing need to refi if they dont feel like it -a vast majority of them refied below 60 % loan to value -at the historical 5-6 percent rate per year. They still have their pre boom debt so they actually save money with the lower payments. 600 dollar payments per month type thing.

the sensationalized 'arm' and exotic mortgages account for around 6% of all homes. When they say 50% of all mortgages sold, that of course does not mean all homes. big diff here. It means out of new purchases and refis -50% of those equal exotic mortgages. Dumb move i agree.

But in the big scheme of things, out of the 6% of homeowners who will need to refi by 2007-8 , probably 2% will actually have to forclose -at most.

to think if every single person in this situation of purchasing beyond their means with the option arm product -6% ALL went under, it would not COLLAPSE the market as a whole. Not even in the slightest. It would barely put a dent into it. And it would be temporary.

Yes, sheriff sales would in this insane scenerio produce short prices, but houses are never appraised by sheriff sales. But by normal home sales. Getting a home below value because of foreclosure does not make everyone dump their prices. Too far and few between, and too temporary a problem.

Yes there are too many houses on the market. yes it is investors faults for getting too greedy. But NO , its not that people are unwilling to pay the price or even more. Houses that DO sell are selling for more than last year. There are not enough BUYERS to compensate for all the huge inventories of these stupid short sighted investors.

So the prices are still going up, but the inventory is also still rising. The market was fueled by investors to a large degree.

It will be a HUGE MISTAKE to sit here and 'wait' . Wait for what? My house to be worth 150k???? How much do you honestly expect a house of my calibe can drop to? Or any house for that matter? Perhaps you have a case for grossly overglutted prices in some areas, but for an average 1200 -1500 sq ft house in the state of florida, how much do you really expect it to drop? Sorry, but i can bet you anything that if prices drop even 10 % , there will be another boom shortly afterwards. It always happens.

where on the west or east coast can you honestly get my house for even 300k ? Its still CHEAP. If you want my exact house in Nebraska -fine, you might get it for around 200, but most would agree they would far rather have florida for more, rather than stuck in the frigid tundra 7 months of the year up north for a little less.

As for you young professionals not willing to pay 200k or more? There are TONS of small houses around 1100 sq ft selling in nice areas for around 150k.

The other lady hit the nail on the head. Therewill be no lasting 'buyers market' . This is just until the inventory goes down. Why?

What is the point of REJECTING a 200k house at 6.25% 30 year fixed, all so you can buy it next year or 2 years from now at worst case collapse price 180k at 8 % interest?????????? What happens if the prices just stabilize, and not go down, which many experts predict.

Experts predict a dump in OVERINFLATED MARKETS , not the united states or any one state as a whole.

its now 2008 and you gotta pay 200k at anywhere from 7 3/4 to 8 1/2 percent interest. Everyone knows that interest rates will return to normal levels within 2 years. Whoopie!!!! You just killed yourself.

do any of you do the math on how much even 1/8th of a percentage point is in payment over the long haul?

So now, so long as interest rates are still historically low , its RETARDED to sit and wait to pay 10s of thousands of dollars MORE INTEREST later on.

I would suggest to renters to stop moaning and purchase a smaller house if you want to save money. Renting is not, never has, and never will pan out at all.

Do you honestly think the prices are going to 'dump' hundereds of thousands of dollars for an average house AND the interest rates will remain 6% at the same time??? The odds of that are so astronomical its silly. Is this what you are basing your plans on????

We bought because the prices of houses in palm bay and many many parts of florida are still WAY undervalued in my opinion. Dont base all of florida on Tampa and Miami and the likes of Sarasota.

Again, there are tons of houses on the market because of INVESTORS , not because people are unwilling to buy houses at these prices.

If you were smart, buy a smaller house while interest rates are still very low, because in florida here, most of the state will continue to increase slowly, not depreciate.

For heavens sake, ignore the post of the mortgage broker. The conflict of interest is glaringly obvious. Don't get stuck with an over-priced tiny house and a huge mortgage.

Just be patient, prices will revert to trend. You are better off renting for the moment.

Yes people, run as fast as you can and buy a house! The law of supply and demand doesn't really effect real estate with rising interest rates. Hurry, before thousands of empty houses are sold! HURRY, HURRY, HURRY!

Ok Mr. Mortgage Guy, answer this: How are the prices going to continue to go up at the rate you predict without the salaries to go with them? In case you haven't noticed, salaries haven't exactly skyrocketed anywhere in Florida for the common working person.

Sure, folks from the North will pay the seemingly paultry amount for a house down here, but just who is going to service them? I don't know about you, but when I retire, I don't want to be working 40-60 hour weeks just to make the tax payment! No teachers means no schools. No police means no protection. No paramedics or firemen, who the hell is gonna take care of everyone when something goes wrong?

There's not the right infrastructure here, Tampa area and beyond, to support the kind of prices being slapped on the market. No one wants to pay a reasonable cost of living salary to those of us who aren't CEO's, executive VP's and the like.

The housing bubble probably won't burst, but will deflate quite a bit. I'm sure there's more of those exotic mortgages in the area than you believe that will default soon enough. Investors get antsy and will cut their eventual losses to put their monies elsewhere.

2007 will be a good year to start getting back into the housing market for the average Joe. I just hope that what's left of the supporting infrastructure - teachers, police, fire, paramedics - can weather out the storm to make it all worth while.

I do agree with Sean about affordable housing in the Florida markets for the community support staff. The hardest hit as mentioned are teachers,police, and nurses. We will begin to see a drain from these professions in the future I believe. The other issue is the price of building materials and labor costs associated with building new homes. They expect these costs to increase 20% this year. The amount of inventory will be absorbed sooner in Florida markets than many other areas in the country. People are still waiting on the sidelines and I completely understand that. However, with the 40,000 people moving here a month,this will change down the road.

Just in the past week, we notice more and more contract pending signs. I know a realtor who said she just had 3 signed contracts over the weekend.
The prices are not really coming down that much, in our area-Sarasota-Bradenton, only the desperate sellers are lowering their prices. For most of the sellers they are holding to their price, and then only lowering it some when they get a buyer. The buyers know it is the right time to buy, our area holds the prices because of our world famous beaches and all the culture that comes with it. As I have said before if you want to live in paradise you have to pay for it.

One more thing, Tricia, how can you say your area holds it's value because of the world class beaches...... There is no history of this area for several reasons... Aside for the beachfront areas, most homes for sale-investors/realtors are sitting on, are in the suburbs that have popped up over the past 2-8 years. Homes on the golf course in Lakewood ranch in the country club were 400K, in the mad rush were going for over 1 million, and are now down to 700-800k and still not selling. This is an unprecedented housing boom that has absolutely NO history. On any given realtors website there are advertisements for foreign investors. They are now gone as the affordable housing that floridians, sarasota-Bradenton-Venice-port charlotte.... have enjoyed for decades. We are in unchartered territory!

Sure do hope you folks cashed in already. The sad thing is most realtors and mortgage brokers probably spent all their commissions instead of saving for the rainy day we are now experiencing! Unfortunately, from the unrealistic posts, I have a strange feeling many didn't and are now in panic mode!

I tend to agree with Sean on this one. Something has to give here. My wife and I live and work in Tampa and make about 95k gross together. We are like many in FL and are from the North. We moved here about 4 years ago but were just out of college and so broke that we could barely breath and couldn't even touch a mortgage. Now we are on track and have been looking to buy for the past year or so.

We're finding 2bdr 1ba condo's for $225k+ plus a maintenance fee of $200 - $250 in Tampa!! This is nuts! No way we can afford to eat and keep up with all of the other costs of living. We make decent money and can't afford to buy here. How in the world can a teacher and a mechanic afford it? Either the housing has to go down or the wages go up! How will this society survive if everyone is a retired baby boomer?

We have been looking at the surrounding areas since to buy in Tampa is crazy. Still it's about $195k to get a condo in Brandon or a similar area, a tad cheaper but still too much. In Ohio (where we are from) $195K buys you a 4bd/2ba/2cg in a great area with great schools and low crime. Yes, the snow sucks (snowboarding is fun tho!), but there is no traffic compared to here, you make the exact same wages as FL, and you actually have a chance to win the rat race.

We will rent for another year and if things don't change then we'll be heading back up north. We LOVE Florida and don't want to leave but its not worth eating beans and rice every day for the forseeable future to live in an overpriced condo and drive 30 - 45 min to work. I know the Mortgage broker and realty agent will disagree and I would too if my lively hood was in the real estate market right now. I know I am not alone, every one of our friends is renting as well (only 1 couple we know has purchased and they are very RICH!!! not that we are the concensus...)

Bottom line the places we have been shopping to purchase HAVE lowered prices in the last few months (about a 10k - 15k drop), but still too much for us. This gives us enough hope to stay around another year, but I'm hoping that the bubble will deflate soon!!

The only reason to Live in Florida is a warm winter! But lately the winters have been hot & humid.

South Florida is the most disconnected place I have every lived in.

Sold my condo that I paid 75k for in 2000 for 290K last year and moved to a real city. Best thing I ever did. And cold weather is sort of nice. You can dress up and not sweat. I'll take winter over hurricanes!

Well I guess it's all relative.

I presently live in Calgary, Canada, where our homes increase in value $500. per day.
Bought ours for $222, it's up to $360 in a year, with no signs of slowing.

Taxes...where do I begin? Pay about 30-40% income tax. The cost of living is pretty high, no increase in wages, and its pretty cold there most of the time! Yep, use the furnace in June.

We are planning to take our equity and move down to better climate, lower taxes and hopefully a better life.

Living in Tampa (Native to the Area) and noticing that the houses are starting to sell again. It is normal in the past to have a slow in the winter and spring. I guess the Newbie Investors just got a bit nervous with the normal cycles and the media breathing housing bubble down their back and therefor listed to many homes during this normal lull. This false frenzy made everyone nervous for a while and no one was buying but everyone figured heck it must be time to sell. You know some interresting trivia is simply that nearly the same amount of homes were selling and going under contract in Dec, Jan, Feb 2005 as in Dec, Jan, Feb 2006 the "Inventory" was the only thing that went up erratically with homes getting listed all day long. Looks like the only FALSE thing about the local market was the False Panic that just occured. At least now that seems to be comming to an end. Sales have increased drastically and the invetory seems to be depleting in chunks. Equilibrium seems to be comming back from the Panicers. I see just in our neigborhood 8 homes have sold in the past 4 weeks where all these homes as well as 3 others sat for the past 3 months due to this false panic. Look forward to the same thing happening again next year during the winter (panic) and summer (normal sales) as for now enjoy your moves and settling into the new home while kids are out of school. At least alot of the Newbie Investors sold off their homes during this time period (probably for less profit or negative profit)and I hope they learned a lesson and will stay out of the industry for a while.

It appears this thread has been taken over by realtors and mortgage brokers. The lines "beautiful house", "world class beaches", and "culture" reek of a sales brochure.

Pamela & Ryan - I haven't seen any sign of sales increase in the Tampa Bay area. I counted 16 (SIXTEEN) homes for sale along a single road in less than 2 miles. There are plenty of homes for sale in my neigborhood (north St. Pete) and lots of 'just reduced' signs.

Tom Davie - you make some good points with regards to prices and rates, but we don't know what will happen to either. I'd say a good bet is for declines in both of them 2 years out. Unfortunately you attempt to use your paper appreciation as a means to justify the increase in prices. What does it matter what kind of house you have? Where I grew up, a house like that would go for $200k, there would be higher wages than FL, and it certainly would be a lot nicer house made of brick and not ugly, cheap stucco that is common in FL.

As a first time buyer, the only thing available to me is a cheap cinder block home from the 1950s that has mature trees but is small (1000 sq ft) with a garage just big enough for a motorcycle surrounded by old foggie neighbors. The other option is a crappy tract home that is slapped together cheaply without much yard, no trees, and surrounded by vain neighbors interested in showing off their new SUV. No joke either; I have friends that fall into both categories. The third would be an overpriced condo but I would never consider that so I don't even think about it. A friend bought a condo last fall and can't sell it now even though he HAS to move for a job transfer. Ouch....

I LOVE FLORIDA!!!! I really enjoy living here but it seems that the cards are stacked against ever being able to make it ahead if I were to get married and have a family. Florida is a great place for water sports but coming from a cold weather state there were things to do up there all winter as well. My Florida car insurance bill is enough to make me gag (and that's on a 6 year old vehicle). The jobs are okay but wages are stagnant. Plenty of work but it's not really a raise to move up $5,000 in salary but spend an extra hour on the road each day. I'll stay here as long as I'm single and everything works out, but the day that changes, there will be a very thorough review of plans.

I have a place in Florida on the East Coast. I pay about $2800 in taxes a year. A neighbor of mine with a SOH exemption and a $25000 value exemption pays around $490. How long do you think it'll be before the out of town owners get a good lawyer and sue the counties for the 4th Amendment violation of equal protection in the Supreme Court. You Floridians make me laugh. You all sight the low living costs , but you are trapped in your homes because of some 1960s valuation. We can't afford to finance you forever!

Believe me I do not want housing to go up any further as well as you. Even though we have a house doesn't mean we don't have similar predicaments with you. We would like to of course upgrade but the houses have gone up too much for us to upgrade very much. However, we have learned to understand that this is how life is, it isn't always fair and if we want to upgrade and stay in Florida we may not be able to gain 1,000 sq. ft. anymore for minimum money. We are just fortunate to have a house and are looking just gain another bedroom for the baby so we have lowered our standards and are looking at homes that are three bedrooms now without the bells and whistles. This happened in California years ago, I know, I know, we are not California but you also must know we are not California prices right now. What I am referring to is when prices went up allot in California (almost overnight) low wage workers and young adults (1st home buyers) couldn't afford to own a house anymore and faced reality. Many moved to other states that didn't have the luxuries of nice weather and beaches but they dealt with it just like you said after all there is some fun in winter sports. Problem is when people age they don't like the cold that is why they all move to California if they have allot of money or Florida if they have a solid retirement which drives up prices. Try Idaho or Wyoming if you want a good bang for the buck and both are undervalued by older individuals with access to the Rocky Mountains! Take advantage of the fact that retires are leaving these states and other colder states to come to warm Florida. Prices are low their now and you can get more bang for your buck (bigger houses) more bang for the buck. You see retires don’t want the large houses they just want the weather and beaches that is why they are willing to pay so much for a small house/condo. Sometimes you have to look at it from another perspective like you had mentioned.

-Ryan-

Do some of the posters read the papers? Do they watch the news? Do they watch CNBC? Do they follow the stock market? Do they listen to Ben?????? If they don't they should before buying up. Even in California the builders are offering $100,000 off homes(one weekend Only-ha). I get emails everyday from builders offering huge incentives. Ryland homes is offering lots of incentives right now. We were going to try and buy in their new Sarasota neighborhood as we've been pleased that they didn't jump on the bandwagon and raise their prices as much as other builders did the past two years. Arthur Rutenberg homes threatened us almost a year ago with the "they aren't making anymore land" and "there's 1,000 people moving to Florida everyday so you better buy now before prices go up" bit. They sent me an email after almost a year, saying they missed us and would love to talk with us if we are "waiting it out". Even they are getting desperate. If that's not a sign of a slowdown than what about the empty homes sitting for months on end because the flippers(oops investors) are in so deep they can't and won't lower the price. Unfortunately, many will get burned in this turn in the market. It's a tough lesson many that are deeply mortgaged will soon learn. Lots of money was made over the last two years. Just like any hot investment, the key is knowing when to get out before it bottoms out.

Florida your property tax is 20% out here in liberal California property tax is 2% That is not a type-o, the property taxes in Calif. are 2% Maybe the Liberials know something your conservitive Republican state dosn't. I went out to Florida to buy land when I heard about your taxes I said forget it. Don't brag about not having to pay state income tax, you are still getting screwed, I did the math.
In addition if I am retired, not having to pay state income taxes doesn't mean a thing to me.

Lisa, you may want to check your calculator because your 20% number is way off. I have no idea what property taxes in CA are. I am sure you are right and they are much less than here in Florida. But I can also tell you that I just purchased my house last year for $400k and the property taxes aren't even close to 20%.

Well I myself must stay in Florida for a while longer due to just becoming an empty nester,I must watch my little birdies stretch their wings and make it on their own and if need be come back to the roost.So I'm looking into the Charlotte County area .My husband has just relocated for his -job in North Fort Myers and the research I've found is Charlotte County (even with the past hurricanes is still affordable).My question is should I buy a newer low priced home in North Port which is in Sarasota Co. and has higher taxes than Charlotte Co. but may be cheaper on insurance due to home being at least a 2000-and up year, or an older one which has been redone (roof walls windows floors ect)due to the hurricanes.I'm wanting a pool this time and plan to retire in it. Or at least live in it 10 yrs.then be a half/backer and maybe move to GA. or NC.Are older homes red-flaged after hurricane damage? Making insurance higher or lower because of being more up to code? Which way should I go?Older homes in Port Charlotte are somewhat cheaper by abought 10k.Any comments greatly appreciated.Thanks

Yes, I bought my house around Tampa bay area (Pinellas county). I paid $500k for the house. My property tax is around 2%. It is about 10,000 a year. So I am not sure where is 20% come from.

I don't know what part of Florida the taxes are 20%. We live in River Club, Braden Woods area and our taxes are no more than $4300.00 per year. Our house is worth $625,000, which we just had appraised by an appraisal company. Yes, the taxes will increase with a new buyer, but our area boasts Siesta Key, Longboat key and so on. We have 6 rated A schools within 5 minutes of our home and we have some of the best golfing around, which my husband loves. Some of these posts sound like people have nothing better to do than make inacurate statements about our real estate and taxes. Like I have said find a better state to buy in and then you can find something to complain about that state. People will always move to Florida, and our contract pending signs are increasing, so obviously people love are area.

I agree on some points...but on buble one ..I disagree with this economist...

Condos to Take the Hardest Hit on the 'Bubble Burst'
Analysts reported that the housing sector's luster is now fading. Douglas Duncan, an economist, recently announced that the housing sector's weakest aspect is the condominium market.

Duncan projected that the housing sale total would drop by 7% to 8% from 2005. He said that the pricing for condominiums is very much different. They are volatile. That is because they only face moving costs.

Analysts also reported the stock market had some setbacks late last week. That is because copper had a rate of $4 a pound and gold went up to $730 an ounce.

In Sarasota-Manatee you can pretty much bank on a 1.2 to 2% property tax rate depending which area of the county you purchase in. There is no bubble so just relax. This is all a bunch of hype. The death of this country will be the media and the way they take a story and run with it. Unfortunately, most people believe everything they read in the paper, hear on the street, and watch on tv. Go ahead and wait for a house to "maybe" go down 5 or 10% (your probably wasting time on an overpriced home anyhow) in the mean time, your interest rate is .5 to a 1.5 points higher. It's a buyers market so go find a great deal and you will probably be sitting on instant equity, plus you will most likely see the typical 5 or 6% appreciation we enjoyed before the frey. I'm not a mortgage broker or realtor, just someone who has lived in the area for 10 years. Had I bought when I first moved here I would be that much better off. The increase in price has been happening since I moved here, and yes it really took off in 2003, and guess what....it will continue to go up(even if at a measly 5%- pretty damn nice return on 500k(that's 25k per year by the way for you slower folk) You will never loose in the real estate market down here if you think long term. The biggest price drop in Sarasota was in 1982 and was only 5%. The truth is this, quite a few homes sold for peak prices last summer right before the slow down. Many sellers listed their homes for these high prices even adding another 20% thinking that we would have another break out year, well that didn't happen, so the price reductions everyone is talking about are on these "overpriced" homes. The homes that are priced right are selling pretty quickly as are homes in the over 1 million mark. In my opinion, this is the best time to buy property down here because of all the frantic sellers. My wife and I are looking for another to add to our portfolio as I type this message. Those of you posting on this board claiming that you can't afford a house in this area on 70 to 100k earnings should talk with a financial planner and find out where you're spending your money. That's the most ludicrous thing I've heard! Work you r way up- I did. Start with a modest home and in a few years if you like sell it and put the equity into another home that is closer to your "dream home". I sense a lot of first time buyers who really don't understand the whole buying process and expect the "perfect" home "now". Maybe you should talk with someone in the industry that you feel comfortable with including realtors, lenders, etc. Interview a few and get their opinions. Especially those that have been in the business locally for 20+ years. They will be able to help explain what great an investment this can be. I also don't hear any mention of the tax benefits of owning vs. renting?? Wow

There is no bubble because the air is gone. It is not the media's fault! If anything, the media kept blowing air for far too long. I remember watching a show on CNBC with homebuilders, realtors.... talking about what a wonderful asset housing is....you can't live in a stock! The value will never go down.......... Shows like this fueled the housing boom! Economists calling for a bust, were made to look irrational at the height of the real estate boom.

To say now is the time to buy in Sarasota/Manatee is just wishful thinking! The costs have gotten out of hand. At least every other house for sale is empty! In newer neighborhoods 30% or more of the houses are for sale. The increases in this area couldn't be sustained indefinately. As far as the homes that are selling, they are few and far between. Even those that are priced right. Two homes I've been watching, were over a million six months ago. One is down to $735K the other $850K for the past two months. No bites.

We are in the market for a home in the $850K range and able to afford in the $1 million range. There is no way we would buy a home there right now. The market is volatile and foreclosures are on the rise. Homes increased double fold. Salaries didn't. Boomers moved to NC, GA, The Villages......the Europeans have left the market as they can no longer get the bargain homes!

If prices are only going up, why are builders in Lakewood Ranch offering $50K in options right now? What's next month? $75K, $100K the month after????? Please, these same builders were so arrogant over a year ago, they wouldn't give you the time of day unless you put a deposit down! Of course you couldn't put a deposit down unless your number came up in the lottery! If that isn't a sign of a downturn, I don't know what is!

People refinanced their homes for the new values and can't get out from their debt. Others bought larger homes because they were scared if they didn't do it now, they wouldn't be able to afford to do it in a year or two. They now have two mortgages and are trying to sell both properties to see which one goes first. Soon they won't be able to afford either property. Simple economics says two mortgages + no buyers= foreclosure!

To tell people they need to meet with a financial planner if they can't afford a home making 70-100K a year is ludicrous! Most people want to keep their hard earned money! Gambling it on a risky real estate market is ludicrous! They just aren't willing to pay $500K for a house that's worth $250 at most! Any reasonable financial planner will tell them that they would save money by renting. You can't get a $500K home with insurance, taxes.... with 20% down for less than $1800 a month. You will save more by renting. Then you won't lose your 20%. Put your money in safer investments! Yes, housing does go down!

The number of rental properties is astounding in the area! I've been watching both the rental and resale market in Bradenton for two years now. The same rental houses and resales are there week after week, month after month. Some almost a year. There are some bargains to be had in the rental market!

I know there are so many who are hurting as a result of the current housing conditions. Only one thing got us to this point. Greed, not the media! Everyone jumped on the low interest rate, it only goes up, they aren't making any more land band wagon.

What kills me is the appraisers. How they could justify appraising simple little tract homes for two-three times the actual worth. Let's blame them. What about the builders, who sold to people knowing they were going to turn around and flip it for more. They aren't hurting yet as they still have orders on homes for the next six months. Watch what happens once those orders are completed!

Buyers, before purchasing, just drive around the area and look at all the For Sale and For Rent signs! Do you want to spend $500K and live next door to someone renting for $1500-$1800 a month. Look at the number of empty homes.... simple economics of supply and demand will make you think-Somethings got to give. Unfortunately, there will be less realtors and lenders who have jobs. There will be people who lose their homes. Greed started this boom and greed will get lots of people in trouble!

lots of good comments,lots of wise people.bought and sold two homes in Bradenton 03-04 and made enough for a 20% dn payment on a new carriage home in Naples,Fl.bought in 04 @186325,sold in 05 @312000.there are now about 80 homes for sale out of the 438 built in that one comm.Naples is one strange market.its almost like a huge ponzi.i don't really think that market will tank but you could find a minor bargain if you look.cost to carry getting burdensome for the last guy on the bus.the flippers have just about run out of stupid people.i think overall Fl has about a 5-6 mo inventory of property.places like Naples,Sarasota,Miami have 18-20 mo.flippers can't carry that long with neg cash flow.thats the potential bargain if your in the right place.we do have a net pop.increase of 1000 day.as long as the major homebuilders build when contracts are signed and not just on spec we should have an orderly market.

No bubble Fl. will always be an area for making money on real estate.Any comments on the Port Charlotte, North Port areas which city would be better to purchase a pool home for under $210,000 Taxes higher in Sarasota but pool homes in the 1990's.in that price range. Port Charlotte is closer for husband to commute to North Fort Myers to work.Port Charlotte I hear is a nicer town with less crime but the homes in that price range are 1970's and 80's Any comments on what to do w/ my equity on purchasing a home in those areas deeply appreciated. Not worried about a bubble bursting,can always sell property here and 1/2 back it years from now if need be.

I am a top-producing realtor in the Orlando Area...the market couldn't be worse!! .................

Those who make thier living from Real Estate sugarcoat what is going on!!.............

Like the NAR ...Home builders etc..

Florida has so may problems to overcome...you'all are locked into your homes cause you can't sell'em!!...The seller's are way over pricing and the buyer's are not buying.....THEY ARE BROWSING!!!...They will not commit!!..................

Some emperical evidence...May'05 total MLS listings ... 10,600 Listings ...Today 49,100 Listings ......................................
Hello...that's almost a 500% increase..YES,.. this is Tampa Orlando to Daytona....

If you think "we have a problem Houston" you are right!!!

I feel bad for the first time homebuyer's ..those with a good income...most are qualifying for 225K to 275K...which is a sad looking house in Orlando vs a few years ago...................

PENDINGS...A VIEW OF CURRENT MARKET....Areas that had 600 plus pendings last year are now 225..and dropping....this is real!!

Those of you who are "hoping" again for a seller's market...listen to my annecdotal evidence....

"Everyone wants the warmer weather, and will retire here" ..How can everybody sell...where are they going?"....

I can tell you first hand...retirees move back north in their older years....75 plus..(to be closer to family and maybe better medical care?).

Also...Central Floridians are cashing out their gains ...i have sold homes for people moving to Tenn, Ga , Al ,S.C., Texas...all way cheaper...(mmm...sounds like the northerners going to lower cost areas ( FLA.), but now Floridians have the idea of going someplace cheaper?? This is NEW!!)

In my opinion the influx into Florida is going to subside..the property tax for new owners is opressive!! (Thank You SOH!!)

We are 7 months into a 4 to 5 year down market......this is Florida's first time...Calif and the Northeast know about a down market.....

Hold on Folks...This market is a rollercoaster...we just went up the big first hill (Price Aprreciation "03-"05) and you'all know what comes next!!

According to www.zillow.com things do not look that bad in Florida. I do not know how accurate zillow is though.

Zillow is way off. Check back in six months. If you want a true reading of Florida real estate, read the local papers. Check out the Sarasota Herald Tribune. This past weekend was an article of homebuilders slashing prices up to $129,000! Drive around neighborhoods in Tampa, Bradenton, Orlando.... It's all the same. House after house for sale. Even Port Charlotte and North Port are going to be hit!!!!!!!! To say that Florida real estate always goes up is to say that the most educated economists are stupid. To listen to a realtor who isn't even required to take an economics class is absurd.

Another way to track real estate in Florida is to watch the listings on realtor.com. I would narrow it down to one zip code though. There are just too many homes for sale in an area like Bradenton or Tampa to track the whole city. You will see the same houses week after week, month after month. Another thing you will see is that the majority are empty! How long can these investors hold on???????

There was an article in the Sarasota Herald back in December about all the savy home investors. It was sad to see bartenders, waitresses being worth over a million dollars on paper because of their investments yet having negative cash flow of -$1,400 a month. Those poor people! What will they do when their adjustable rate mortgages go up???? So many are going to get burned. I know that a positive spin needs to be put on this to help get people out of very grave situations, but as the old saying goes... if it walks like a duck and sounds like a duck, it probably is a duck.

Yes Virginia, there is a real estate bubble! Florida has experienced a bubble of epic proportions!!!!!!!!!!!

Goldie, I took my daughter up to camp in North Carolina this past weekend. The number of Florida plates were astounding. At first I thought they were all vacationing, but after looking at a few developments, found that the area of Asheville, Hendersonville... are being over run by the Floridians and halfbackers. The salesperson said that they have record sales in the last 12 months and 65% of the buyers are from Florida. Alot of halfbackers. I guess the North Carolina mountains aren't seeing a downturn just yet.

Hopefully things will get back to normal in Florida. Enough making $100,000 in a year! People need homes to live in not to make a career of it. Too many tried to milk the Florida real estate investment cow.

Live report from Tampa Bay here. Looked through the St. Pete Times on Saturday - plenty of homes for $60,000 off initial price. I suspect that will soon become $160,000 discount because there is no way someone should pay $224,000 for a small 3-bedroom house that is 30 miles from the majority of jobs.

Driving through town on Sunday were a bunch of "cheerleader type" girls on the corners of Kennedy Blvd. at all major intersections holding signs saying "CONDOS: MOVE IN TODAY FOR $1". The local condo market must be very rough, but it shows there was a limited pool of suckers to buy 20-year old apartments that received a cheap cabinet upgrade and pay a monthly outlay over 2x the cost of the market rent just for the pleasure of owning.

On the flip side, the apartment market is going haywire. Many places are raising rents 10-20% per YEAR because the apartment supply has been so constrained with condo conversions. Once many empty condos come back on the market as rentals this will drive down the increases but it will be years before this market is anywhere near a stable situation.

Moved from Cleveland, OH to Lakeland (really an exburb) of Tampa. Cleveland. Land of semi cheap houses and no jobs. Tampa, land of expensive houses and tons of jobs. There are a lot of semi decent jobs here, and a huge number of low paying ones. There are jobs everywhere. hiring bonuses for jobs at the Florida minimum wage of $6.40.

Nice 1600 square foot starts at 200k+++++.

I have a decent job but can not afford $1700 a month that would cost PITI.

As for actual declines... We shall see. It depends on the balance of "want to movers" vs. the "have to movers" A person I work with is putting his home up for sale soon. He is a "want to mover" and wants to move up. When I asked him what happens if he doesnt get his (inflated) price, his answer was "I'll wait it out"

205k house now comes with 20k in "free" options. its not in quite as nice a city and the schools are not as good though. In the better areas that house is 220k with 20k in "free" options. I can not afford either unless I do some kamikaze financing scheme.

OTOH ***NICE*** houses rent for $1100 to $1200 a month.

I talked to one of the house salespeople. She told me when she started 2.5 to 3 years ago the neighborhoods started at 80k. Now they say 180k. (1100 square feet so a tad small for a family of 4)

We started looking for building a new home around Tampa bay area since 2003. Most custom home builders offered some kind of incentive. We went with Mark Ruthenberg homes in March 2004. They offered "perfect kitchen" as free option. Include upgraded granite counter top, 48inch wood cabinet, Thermador stainless steel professional appliances . It was 50k plus options. Then we asked them to throw in tile floors for the whole house. They did as well. Mark Ruthenberg is custom home builder in Pinellas county. That was about 50-60k free option on 550k+ homes 2 years ago. Other builders offered something else in the same community. So I guess the incentive is really nothing new. Builders have to compete with each other in the same community. Of course, now it is tough time, they might throw in more stuffs now. I have not check the new home lately.

I live in Tampa in the Hunters Green area. I have been watching the market very close and I can tell you Pulte has been sending me e-mails. I went to look at a home in Meadow Pointe and was told 360K now that model is on "special" for 290K can we all say slow down.... Hunters Green (very desirable area) had a waiting list of people wanting to buy homes last year, now if you drive throught the neighborhood you see lots of for sale and "reduced price" signs last year I could not find any for sale signs because they were sold before the sign even went up. I went to an open house 3 months ago the house was 315K that house is still for sale "price reduced" 265K. I don't know where some of these people are getting their information but I won't buy a house right now because I have been watching very closely and the prices have come down. I would say if you are in the market watch it for a couple of months at least houses are staying on the market much longer. Before you put in an offer look at the proeprty appraisers website and see how much that person paid,how long they have had the house, and what the taxes are. I use lots of public information to my benefit when home shopping. Be an informed consumer.

Just give 2 more years for things really to start falling. Can we all say negative amortization loan? Most of these will mature in 2 years and those poor buyers who are now paying X dollars will paying 2X to 3X for mortgage.

I've read, thre will be 25,000 more condo units completed by the end of this year in South Florida. 70% of those units were bought by "investors" who borrowed money to do so. One of my friends is such an investor. Last week he received a letter form his condo association that his mainteance fee is going up from $600 to $1000 a month due to insurance increase.

AJ,

They aren't getting info. They are most likely speculators, realtors, mortgage brokers or in some field that they make their living off real estate. I guess another scenario is that they are homeowners who refinanced the inflated equity in their homes, spent the money on cars, vacations, boob jobs.... and now can't afford the payments and must sell. It's scary what has happened and unfortunately more than just the slime balls will get burned!

I hope Tampa recovers quickly from this. I almost bought a house last year in Grand Hampton, but I couldn't bring myself to pay the kind of money they were asking. I knew that Taylor Woodrow homes in there started in the 400's when the neighborhood opened the previous year. Last year they were close to sell out and were asking in the 700's. I knew that construction prices, and definately the land prices(since it was already purchased) hadn't gone up to warrant such an increase in new construction in one year! GREED! Of course what really kept me from buying an Arthur Rutenberg home there were the lines the saleslady kept giving us. We felt we were buying a used car not a high end home. I love Tampa and hope we don't have to much of a backlash from this.

WARNING: slimeballs stay away from Florida! You've done enough damage.

Check out this report to see how Fla housing has gone from approx. 10% undervalued to approx. 30-100% overvalued in just five years.

http://www.globalinsight.com/gcpath/1Q2006report.pdf

I sold my house in Va. and moved to Jax Beach where I am renting. I have spent the past three weeks trying to see if there is a niche of this housing market (in Jacksonville) to make money in today and I'm convinced there isn't. For rental property the numbers don't work unless you expect rents to rise 10% a year - and the quality of renters in Jax is low. Typical 2/1.5 X 2 duplexes are listed in the 450K range at (not on) the beach. I think I could buy one for around 360K - but do the numbers - at an optimistic 24K/yr. total rent you can't even break even on a 30-year fixed at 6 1/2% even putting 60K down, what with taxes, insurance, etc. (a full 3 X Va. levels). And there is a huge amount of building going on. I see best-case scenario as a break-even on resale values over the next five years even if rents do rise 10%/yr., which is unlikely (I do think rents will rise more than housing prices, though). Worse-case scenario is down 20% in 2007, down another 10-20% in 2008. I like Florida a lot, too, and I think I'll hang out here for a year, but then I'll probably end up buying in TX or TN. Florida, California, Massachusetts - they're all in the same boat and have already taken on a lot of water.

Just saw on the news, the newsman still belive there are housing boom in Tampa bay area. He reported there are going to be around 5,000 house to be build around SR50 & Suncoast highway (Hernado county).

Condos dropping like crazy in the SE (fort lauderdale).

My current one bedroom apt decided to go to condo, got notice in Dec. 2005, was to be out by Aug 06.

I was given the option to buy at 160,000 in Dec 05.

In May 06, they decided to give me a "special" price of 150,000 due to being a "great tenent" - yeah right.

Last week (July 06), got the option of 125,000 OR continue to rent for another year. Well canceled my new apartment lease and Im staying.

Another couple months they may give me 2 for 1. :)

Wait it out folks.

There was just an article in last weeks paper that Lakewood Ranch will be building 500 more homes on the Sarasota County line. Things certainly are not slowing around here. We have a neighbor that just FSBO'd her home 3 weeks ago, and got a qualified buyer. She got 95% of her asking price. The real estate market has been real slow this year, but it is starting to really pick up. We were just in the Winston Salem/Clemmons NC, area. Very nice, but you do have to pay a high State income tax, we looked at several homes in Kernersville, and the taxes were $2600-$2900. Couple that with State income tax and you are still paying more than here in Florida. Even with our homeowners insurance and real estate taxes, we still fare better. Plus we Have Siesta Key beach, voted 1 of the best beaches in the world. Love Florida and will never leave.

Hah, no bubble?

Renting an apartment for 850 a month in lauderdale for the last 2 years.

Dec. 05 - Get notice of condo conversion and need to be out by Sept. 06. Asking price for my unit is a "special" 150,000 and for the public its 157,000.

May 06 - Get a letter that due to being a "wonderful tenant" they will discount 5,000 to 145,000.

Well guess what? Just got a letter that I can stay at my place for another year for 850 a month plus I get free membership to the golf course which is normally a 50 per month membership.

Hear something? I think its air seeping out of a giant bubble or should I say an investors head.

OK- Just had to answer some of these comments. First of all, everyone in Florida just thinks the home prices are inflated because they haven't experienced this before. In the New York area where I have lived and owned many homes, double and triple of prices in 5 years is "normal". And the people who own these homes, can still find buyers to pay these prices for them. I am 50 with a pension and set financially. Every one I know in the same boat is looking for something in Florida. The taxes and insurance are high in comparison to what we pay here, but the weather and other attractions still hold. As for first time home buyers and the price ect., you guys are really spoiled. No one here could dream of buying 3500 sf + brand new homes. I'm talking about people with a $200,000 income and net worth in the millions. So a first time home buyer complaining about what they can't buy sounds rediculous to us. First time home buyers here can buy a 1950's era ranch on a tiny lot in a so-so blue collar neighborhood for 400,000. Taxes 7,000 and going up. As long as Florida compares favorably to that, people will come. The reason there are not as many buyers, is that people are being scared off by all the reports of bubbles, ect. so they are just waiting. Me included. But if they are not speculating and expect to spend any time in Florida they will buy. At least that's my opinion.

The denial of the bubble is just comical now.

Glad Lakewood Ranch is expanding. More reason not to buy there. You think they'd hold off until things settle. Glad the FSBO's are selling because the MLS listings certainly are not. Drove around again last week and even more for sale signs. The builders have had the same lots for at least a month for sale.....Good idea build 500 more empty houses. Great community, but much too risky. I feel sorry for all those that have stretched themselves too thin. I bet the FSBO neighbor is sleeping better now.

As far as comparing New York to Florida that's just a joke. Keep on moving down, there's some great deals out there. There are 5,608 listings in Bradenton(1,328 in the Lakewood Ranch area), 5,845 listings in Sarasota, 6,911 in Tampa,8,291 in Orlando, 2,997 in Clearwater, 7,526 in jacksonville, ........... there are plenty of houses to choose from. Glad there are some who are willing to pay the price. Florida needs to sell some properties. Keep em coming! A lot of people are in a bit of a financial mess. Good thing there are folks from New York to bail them out.

Just saw on CBS news, the home forsale inventory was up 392% in Orlando FL. The bubble burst!!!

Donna,

You defeated your argument when you said

"I'm talking about people [in NY] with a $200,000 income and net worth in the millions."

Ya, well, people in florida don't normally earn $200,000, and they aren't worth millions.

And, New York is in a deflating bubble too, so what is your point?

John

You think you got it bad ? try living in the UK, especially in the South of England. And as for taxation - let's not go there. Typical small [i.e. VERY small in US terms] house is £150k [$270k-ish].

You can say no bubble all you want. My wife and I can afford a house and we rent. My boomer parents can afford a retirement home and they won't buy.

Buying in Florida right now would be stupid, bubble or not.

Donna,

I had to read your post again. Okay, first time homebuyer should pay $400k for a house?????? That sounds good to you??? My first house costs $60,000. We didn't buy a $400k house until our salary was well in the six figures(we like to eat, take vacations, shop....without any debt). Four years ago, $400k bought you a nice, large home with a pool in Florida. Four years later young people should be paying 400k for a starter home? I don't think so! It is delusional people that kept the prices going up for as long as they did! The only way a first time buyer on a combined salary of $60k can afford to buy a $400k home is to use "creative financing" and find themselves so deeply in debt that 2 years later they will find themselves needing to sell or refinance to pay off the debt. Looks like that's what's happening in Florida now. Only problem is they now have to compete with everyone else in the same boat, those that want to get out before it gets worse and the flippers!

One thing to note, we are buyers sitting this thing out. We won't touch a house built between 2002 and 2006! The investors who bought those homes didn't care about the quality of the build. They probably didn't hire their own inspectors. The houses were built so fast the quality can not be what it was pre bubble! We will either purchase a home built before this time or wait for the builders to come down in price(Which they already are) and slow down.