Smith and Associates

Market Change

Smith and Associates Real Estate has been tracking the Bay area real estate trends for years and at their annual meeting released those trends providing some insight into what is effecting seller and buyer decisions in the resale market of condominium and single family homes. Listing Inventory in Hillsborough County

In both Hillsborough and Pinellas counties the listing inventory is lower today than it has been in the past 5 years.  This statistic compares both residential and multifamily- condominium properties.  The factors that will continue to support a reduction of inventory are the federal programs that have been established to assist seller’s in keeping their homes by reconfiguring existing problem loans to reduce short sales and foreclosures.  In addition, the fiscal policies that are providing monetary programs have reduced interest rates so consumers can enjoy refinancing at historic low rates.

Many sellers had to rent their properties placing longer term leases into effect for several years holding out for conditions favorable to sell and obtain value.  Housing values took their greatest adjustment in 2008, with sellers having to adjust value competitively to meet buyers perceived purchase power.  That total dollar volume remained below records kept over the past 5 years.  By late November into December the volume began to trend back up.  That signaled stabilization in values as sales increase and inventories continue to stabilize and in some neighborhoods decrease.

A push of closings at year end allowed the Greater Tampa statistics to be out in front of 2007 for total closed units of 14,886.  The difference was small but after a year that began with some stability and consistencies, by September with the collapse of the markets, so went real estate.  Based on contracts written late 2008 into 2009 there is a great disparity between how the market began to taper off in late 2007.  This trend, along with the diminishing listing inventories, further supports stability in values for homeowners but that also may be a marker for the buyers who were hoping to have bought at a perceived “bottom” of the market.  Again, fiscal and monetary policies have not been fully felt in sales.   As further capital becomes earmarked to conforming and jumbo loans with the competitive rates now available it is expected that 2009 sales will again improve over 2008 with some consideration towards values of some of the areas of the county improving in late 2009 into 2010.  The average price of a single family home $233,961, along with the low interest rates, makes the affordability factor high based on number of households that are able to purchase.

Condominium Sales

The total dollar volume of closed sales $325,081,733 is 20% less than prior year 2007 closings (1,619 units vs. 1,732 yr prior).  Throughout 2008 properties that were considered condo conversions had accounted for the majority of unsold inventory, remaining inventories were reduced to sell gradually or converted back to rental.  Entire condominium developments such as “The Place” in Channelside were sold in their entirety and have since converted to rental units.  The Element condominium in downtown Tampa  released its buyers and have restructured ownership in order to provide the offerings as a luxury rental tower.  As the activity has ended on new developments and without capital for any new projects in the near future it allows the buyers to have confidence in an existing condominium purchases.

Pinellas County Sales Activity

Sales were off from 2007 to 2008 in Pinellas County by 6% over the year prior.  This gap had begun to get closer in the last quarter of 2008, the turn around was in September  as residential sales began to exceed the prior year as a consistent trend.  The average price of an existing single family home is likely to rebound from the low of $249,000  as properties are expected to begin a slow rebound.  The absorption rate further supports the stabilization although the increase from year to year is within a point that shows a trend from July forward that both condo and single family had increased over a year prior. (Determined by number of units sold during the month by the total number of listings in the MLS).