Florida's Existing Housing Market Reflects Mortgage, Economic Issues at Year End 2008

Florida's Existing Housing Market Reflects Mortgage, Economic Issues at Year End 2008

Residential News » Residential Real Estate Edition | By Michael Gerrity | January 26, 2009 4:48 PM ET

(News Source: Florida Association of Realtors)

Orlando, FL -- Florida's housing market mirrored the national trend in 2008, as mortgage industry troubles, unsettled financial markets, tightened credit and other economic issues impacted sales and prices. By year's end, a total of 124,215 existing homes sold statewide, a decrease of 4 percent compared to 129,855 homes sold statewide in 2007, according to the latest housing data released by the Florida Association of Realtors (FAR).

Florida's median sales price for existing homes was $187,800 at year-end 2008; a year previously, it was $234,300 for a 20 percent decrease. The median is the midpoint; half the homes sold for more, half for less.

"Taking steps to energize and stabilize the real estate market is key to economic recovery," says 2009 FAR President Cynthia Shelton. "Not only do strong housing and commercial property markets generate business, but they are essential to helping families build wealth and stability.

"Research shows that the typical Florida homeowner intends to hold their property for 10 years. In 1998, Florida's statewide median price was $104,700; at the close of 2008, the statewide median price is $187,800. Long-term homeowners continue to have the benefit of price appreciation, as well as a benefit that simply can't be measured - a place to raise their families, make memories and enjoy their lives. A place to call home. And now, more than ever, consumers can rely on the expertise of Florida Realtors to help them meet the challenges of today's marketplace, whether they're looking for a home or the perfect place for a new business."

Five of Florida's metropolitan statistical areas (MSAs) reported increased existing-home sales for year-end 2008; at the same time, four MSAs showed gains in existing-condo sales. December marked the sixth consecutive month that a number of Florida markets noted higher sales activity.

Economic issues are continuing to affect consumers and thus inhibit the housing market, according to Lawrence Yun, chief economist for the National Association of Realtors® (NAR). But in NAR's latest housing outlook, he noted that the right economic stimulus package could help. "With a proper real-estate focused stimulus measure, home sales could rise more than expected, by more than 10 percent to 5.5 million in 2009, and easily begin to stabilize home prices in many parts of the country," Yun said. "Stable home prices will, in turn, lessen foreclosure pressures and lay the foundations for a solid economic recovery as the nation's 75 million homeowners regain confidence."

In Florida's year-to-year comparison for existing condos, a total of 37,797 units sold statewide at year's end 2008, a decrease of 10 percent compared to 41,865 sold by year's end 2007. The statewide existing condo median sales price was $164,400; at year-end 2007, it was $205,200 for a 20 percent decrease.

The annual average interest rate in 2008 for a 30-year fixed-rate mortgage was 6.03 percent, down from the annual average rate of 6.34 percent in 2007, according to Freddie Mac. FAR's sales figures reflect closings, which typically occur 30 to 90 days after sales contracts are written.

Among the state's large to medium-size markets, sales of existing homes in the West Palm Beach-Boca Raton MSA remained basically level in the year-to-year comparison, with a total of 6,953 homes sold at year-end 2008 compared to 6,971 homes the previous year. The existing home median sales price was $302,800; at year-end 2007, it was $369,400 for an 18 percent decrease. In the year-to-year comparison for the existing condo market, a total of 6,075 units sold in the MSA at year's end, up 7 percent compared to 5,674 condos sold the previous year. The market's existing condo median price was $143,800; at year-end 2007, it was $198,000 for a 27 percent decrease.


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