Lots of action on Periwinkle Way today with setups going on across the street for Sunday afternoon’s “Taste of the Islands”. It is expected to be a beautiful day with thousands in attendance for a good cause (C.R.O.W.) so we are hoping that we’ll see a few walk-ins also interested in real estate. The islands already are filling up for the Thanksgiving holiday, with more check-ins expected tomorrow, and as the next week progresses. Here are a few news items, followed by the activity posted in our Multiple Listing Service since last Friday. We’ve been busy.
Real Estate Recovery Depends on Jobs
The National Association of Realtors® (NAR) posted an article yesterday indicating that although the recent trend of rising long-term borrowing rates may mean higher mortgages for consumers in the coming months, the greater obstacles to housing market recovery are job creation and availability of credit. “Modest changes in mortgage rates are less important to a housing market recovery than the number of people who are able to obtain mortgages,” says NAR Chief Economist Lawrence Yun. Last week, NAR’s Board of Directors approved a credit policy to urge the mortgage lending industry to reassess and amend their policies so more qualified homebuyers can become homeowners. “Currently, the overly tight underwriting standards are holding back the pace of housing market recovery,” says Yun.
As Congress reconvenes this week and considers an extension of the Bush tax cuts, their decision could impact job creation. If the Bush tax cuts are extended for those earning less than $250,000 but taxes are increased for higher earners, Yun expects about 1.5M net new jobs to be added to the economy in 2011. Mortgage rates are expected to rise to 5.4% by the end of 2011 from the current 4.2% average rate, provided the inflation rate stays manageable at near 2%. Total home sales, both existing and new combined, would rise to 5.5M in 2011 from 5.1M in 2010. If the Consumer Price Index inflation rate reached 3%, then mortgage rates could rise to 6% by the end of 2011, cutting home sales to 5.2M. “If the Bush tax cuts were extended for everyone across the board, an additional 400,000 jobs could be created in 2011, with home sales rising by an additional 60,000 to 80,000.” says Yun.
Expert Predicts New Wave of Repossessions
An article in yesterday’s “Miami Herald” also had some other closer-to-home predictions. Foreclosure investor Rich Meyer told a group of Miami real estate professionals this week that the foreclosure slowdown initiated by banks will lead to a sharp drop in bank-owned properties and an increase in short sales in the short term, followed by a new wave of bank-repossessions. Meyer, a veteran of Broward County’s courthouse foreclosure auctions, said the current halt in new foreclosure inventory would be temporary, and predicted a return to record-high bank repossessions by mid-2011. “There’s a backlog of future filings,” said Meyer, who now teaches investors how to navigate the foreclosure world. “Once the litigation is settled, it’s going to be a wave.” Potential investors attended the Condo Vultures workshop, looking to hear about what the foreclosure freeze means for the hottest sector of South Florida’s housing market. As the market for bank-owned homes, or REOs, dwindles, there will be more competition and prices will increase, Meyer told them. Banks are also likely to favor short sales over foreclosures in the near term, he said.
The workshop took place just a few hours after bank executives and real estate experts testified before the U.S. Senate Banking Committee in Washington about problems plaguing the foreclosure process. During the hearing, the president of Bank of America’s home loan unit, Barbara Desoer, acknowledged that mistakes were made in the bank’s foreclosure processes, causing some homeowners to be foreclosed on while they were on track for a mortgage modification. About 20% of Bank of America’s defaulting loans are in Florida, Desoer said.
The Congressional Oversight Panel released a report this week stating that the potential fallout from “foreclosure irregularities” could be significant. “Banks may be unable to prove that they own the mortgage loans they claim to own,” it read. “If such problems were to arise on a large scale, the housing market could experience even greater disruptions than have already occurred.” Meyer acknowledged that the road out of the current foreclosure mess is likely to be particularly difficult in South Florida, which has one of the nation’s highest default rates. “It’s going to get ugly and the banks have recognized that it’s going to get ugly,” he said. “And that’s why they’ve pumped the brakes on these foreclosures.
Sanibel & Captiva Real Estate Inventory
Though island real estate professionals continue to believe that we will have a good winter selling season, our business continues to be affected by reports such as those quoted above and the economic happenings around the world. Our market is unique but no longer insulated from these events. Here’s an update of island inventory and sales today compared to past years activity. Notice that although the number of condo sales is up this year, the average sale price continues to decline. The number of Sanibel homes sales is a tad behind last year, while lot sales are up. From a seller’s prospective, prices are pretty dismal in all property types, but the good news is that island real estate is moving. I had several appointments this week with prospective sellers, many in price shock when I relayed my estimate of the market value of their property. Several offers passed my desk this week too, with the SanibelSusan Team thrilled to be super busy again. I am happy to report that Lisa Murty will rejoin our team in early Dec, initially part-time. She received her FL real estate license while working with us in early 2007 so already knows the ropes in the office as well as many of our clients and their properties. Welcome back, Lisa.
Follow the BIG ARTS Chorus
11/21, Sun – Sanibel Thanksgiving Celebration at The Community House, 6:45 p.m. Bring a non-perishable food item or monetary donation for F.I.S.H. (Friends in Service Here).
11/27, Sat – Sanibel Masters Art Festival at The Community House, festival is 9 a.m. – 5 p.m. (both Sat & Sun). We sing twice Sat, late morning.
12/3, Fri – Sanibel Luminary. Several chorus members will sing Christmas carols at Baileys Shopping Center and The Community House.
12/9, Thurs – BIG ARTS Chorus Annual Holiday Concert at the BIG ARTS auditorium, 7 p.m. Expected to be a sell-out again this year. Buy your tickets now at the box office.
Sanibel & Captiva Islands Multiple Listing Service
Here’s the activity posted since last Friday (November 12-19, 2010)
3 new listings: Tennisplace #E33 2/1.5 $279K; Lighthouse Point #230 2/2 $519,915; Lighthouse Point #128 2/2 $649K (our listing).
5 price changes: Coquina Beach #5A 2/2 now $379K, Nutmeg Village #308 2/2 now $679.9K, Shorewood #2C 3/2 now $874K, Pine Cove #1A 2/2 now $899K, Dosinia #D3 3/3 now $1.595M.
5 new sales: Pointe Santo #D41 2/2 listed for $759.9K, Compass Point #112 2/2+cabana listed for $999K (our listing), By-The-Sea #C301 2/2 listed for $1.395M, Tantara #301 3/3 listed for $2.495M, Sanibel Siesta #203 2/2 listed for $349.9K.
No closed sales.
10 new listings: 2991 Singing Wind 2/2 $434.9K, 9127 Mockingbird Dr 4/2.5 $597K, 548 Chert Ct 3/2 $624.9K, 4377 Gulf Pines Dr 3/3 $675K, 1057 Sand Castle Rd 3/2 $725K, 1241 Junonia St 3/3 $779K, 751 Sand Dollar 4/2.5 $875K, 1558 San Carlos Bay Dr 2/2 $1.5M, 791 Pen Shell Dr 4/3 $1.699M, 5029 Joewood Dr 3/2.5 $2.595M.
11 price changes: 766 Donax St 2/2 now $330K, 1613 Sand Castle Rd 3/3 half-duplex now $399K, 1236 Sand Castle Rd 2/2 now $425K, 9428 Moonlight Dr 3/2 now $489K, 4573 Bowen Bayou Rd 3/2 now $639K, 1405 Causey Ct 3/2 now $659K, 271 Robinwood Cir 4/2.5 now $699K (short sale), 310 East Gulf Dr 3/2 now $729K, 751 Sand Dollar Dr 4/2.5 now $875K, 600 N Yachtsman Dr 3/2.5 now $1.214M (short sale), 1069 Bird Ln 4/3.5 now $3.749M.
4 new sales: 721 Cardium St 2/1 listed for $259K, 237 Daniel Dr 3/3 listed for $646K (my sale), 885 Limpet Dr 3/3 listed for $1.739.9M, 1262 Bay Dr 3/2 listed for $895K.
1 closed sale: 2001 Roseate Ln 2/2 $300K (short sale).
1 new listing: 1639 Serenity Ln $310K.
4 price changes: 971 Main St now $199.5K, 5148 Sea Bell Rd now $250K, 1299 Par View Dr now $259K, 5439 Osprey Ct now $391.5K (foreclosure).
1 new sale: 3324 St. Kilda Rd listed for $294K.
No closed sales.
1 new listing: Tennis Villas 2/2 $410K.
No price changes.
No new sales.
1 closed sale: Bayside Villas #5218 1/2 $271,584.
No new listings.
4 price changes: 13500 Palmflower Ln 4/4 now $995K, 1 Sunset Captiva Ln 2/2 now $20195M, 15699 Captiva Dr 5/5.5 now $7.495M.
1 new sale: 13500 Palmflower Ln 4/4 listed for $995K.
No closed sales.
1 new listing: 13470 Palmflower Ln $1.195M.
No price changes, new or closed sales.(This representation is based in whole or in part on data supplied by the Sanibel & Captiva Islands Association of Realtors or its Multiple Listing Service. Neither the association nor its MLS guarantees or is in any way responsible for its accuracy. Data maintained by the association or its MLS may not reflect all real estate activity in the market. The information provided represents the general real estate activity in the community and does not imply that SanibelSusan Realty Associates is participating or participated in these transactions.)