Do you think that Real Estate Prices will Continue to Rise in Florida.?
As stated in some of my previous posts, the real estate market had been sliding down since 2006 and home prices have gone down approximately 34% through the end of 2011. All that equity we had in 2005 went Poof.
That all seems to have turned the corner:
There are a number of factors will help bolster the housing market. Some include:
- There’s been a decline in the number of foreclosures
- Home Inventories are VERY low
- Continued job growth
- Home buyers have better access to mortgages
- Mortgage rates are at historic lows
Asking prices have already increased 1.4% in the first quarter of 2012 as compared with the last three months of 2011. There are differing opinions regarding the future of foreclosures. Stan Humphries, chief economist for Zillow feels that foreclosures have started to fade and that the percentage of mortgage loans 90 days late or greater is a good predictor of future foreclosures. That percentage is falling fast.
There are other factors that also effect the real estate market some include:
- The rate at which distressed properties come onto the market will influence the rate of home price increases. Although it will influence it, I think it will only slow down the rate in increase and not reverse it.
- The state of our economy is a definite influence on home prices. If our economy crashes, so will everything else. As long as our economy continues to get better (regardless of the pace), home prices should continue to go up.
- The state of the world economy, particularly the Euro, will have a definite effect on home prices and everything else.
- Not all states are effected in the same way. Fortunately, Florida has several advantages. It’s not call the Sunshine State for nothing. People flock to Florida. The Over 55 Communities are active, and has a constant flow of home buyers from the north (Mostly New York and New Jersey). Investors love Florida. Investors buying Florida real estate has been booming.
So what does this all mean. Nobody knows for sure. Optimism is good. It’s certainly better than pessimism. I’d like to know what you think. Please comment on this and I’ll include it in a follow up future blog.