Optimism in South Florida Housing Market
According to Seattle-Based real estate website Zillow.com, South Florida’s housing market hit bottom at the end of 2011. Zillow’s position is supported by local interviews conducted by the Sun-Sentinel, who spoke to a dozen builders, buyers, analysts, real estate agents and other people involved in the local real estate market, ten of whom agreed that the housing market had reached a low point.
The median home value in South Florida has risen 1% since last year to $141,300, according to Zillow. While there may be outliers in individual cases, Zillow predicts that overall prices will climb about six percent, which would make it one of the country’s best performing housing markets.
Stan Humphries, Zillow’s chief economist, is advising people to take advantage of the low housing prices: “For people who have been waiting to time their home purchase close to market bottom, it’s time to start shopping.”
Other market-watchers seem to agree. “There are a lot of good signs,” said Ken H. Johnson, an economist at Florida International University. “If the guy who buys today looks to sell in a few years, I don’t think he will have made such a good decision. But if he buys and holds off selling for eight years or so, he’ll think, ‘Man, I made a good investment. That was really shrewd.'”
The South Florida market was particularly hard-hit by the recession. Beginning during the 2006 housing bust, short-term investing and liberal lending policies created a market with severely over-inflated prices. Existing single-family homes values fell by more than fifty percent in Broward and Palm Beach counties. Condo values were affected even more profoundly, with values falling more than sixty percent.
Prices now are back to levels seen in 2002, fueling a rebound funded largely by foreign investors and others paying cash.
While things seem to be moving in the right direction, some observers are more skeptical than others. The number of single-family homes in Palm Beach and Broward counties has shrunk by thirty-eight percent and forty-eight percent, respectively, fueling bidding wars and driving up prices. Real estate agent Marisa DiLenge is not as excited as others. “I honestly am a little afraid,” said DiLenge. “I think we’re setting ourselves up for the craziness that we had before.”
Schecter Law is a full service real estate and transactional law firm that has been providing representation and practical legal solutions for property acquisition, sales, investment and development to the greater South Florida community since 1976. It is our practice to give each client our undivided attention and to dedicate ourselves to our clients’ unique needs.
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