Existing Home Sales Decline Nationally but not in Palm Coast

Once again, national headlines overshadow the fact that the Flagler County market for existing homes is doing OK.

Palm Coast, Florida – December 23, 2008 – A report released this morning in Washington, DC by the National Association of Realtors® (NAR) announced "Existing-Home Sales Decline in Economic Uncertainty." The Wall Street Journal’s take on the NAR report, can be found under the WSJ’s juiced up title "Existing, New Home Sales Plunge." Neither title applies to the Palm Coast/Flagler County market.
 

National

Nationally, the number of existing homes sold in November declined 8.6% from October ’08 and 10.6% from November ’07.
 

Palm Coast/Flagler

The number of existing homes sold in November declined 15.3% from October ’08. However, this is in line with our local market. In each of the past three years, October to November sales numbers have declined (’07 – 4%, ’06 – 34.1% – ’05 – 19.6%), indicating seasonality, not a general trend.  This may be true for national markets as well. More importantly, the number of sales in November was up 6.4% over ’07. In fact, the last three quarters of ’08 is up 6.3% over the last three quarters of ’07 (and the month is not yet over).

All Real Estate Markets are Local

Despite an overall softening in sales, there has been a solid trend of rising activity in California, Nevada, Arizona, and Florida markets. "Sales are rising only in areas with large numbers of distressed properties as bargain hunters take advantage of discounted home prices," according to NAR chief economist Lawrence Yun.
 
Prices have been drawn down by the sheer number of short sales and lender-owned properties on the market. As the NAR report states, "There remains a significant downward distortion in the current price from a large number of distress sales at discounted prices."

Distress Sales

As of this writing, 81 single-family homes have sold in Flagler County vs. 79 in all of December ’07. But 59.2% were either lender-owned (through foreclosure) or short sales. Following are some examples drawn from actual December ’08 sales of single-family homes illustrating the extent to which distressed sales can depress selling prices. Notice that the previous sale dates cluster around the peak of the market when the most exotic mortgages were available.
 
Short Sales:
 

Short Sales In Palm Coast and Flagler Co.

Sale Price ($000)

Previous Sale Date

Previous Sale Price ($000)

100

12/06

217.4

100

8/05

209.9

147

1/06

248.5

106

1/06

235

260

7/05

420

125

6/06

225.4

125

5/06

222.7

106

6/05

187.5

355

6/06

438.1

138

12/05

238.1

113

12/05

249.9

100

4/06

235

220

10/06

385

215

9/05

440

115

8/05

210

 
 
Lender-Owned:
 

Lender-Owned Home Sales in Palm Coast and Flagler Co.

Sale Price ($000)

Previous Sale Date

Previous Sale Price ($000)

197

2/06

296.9

129.9

5/06

150.9

119.9

1/06

239.3

119.5

6/05

205.9

178

11/05

292

125

6/05

175.9

126

10/05

223

154.2

8/06

290

190

4/06

340

114

10/06

284

85

4/06

169

135

10/05

216.8

130

8/05

225

2 replies
  1. George Meegan
    George Meegan says:

    You can’t build them for what they are selling for

    The bottom of the housing market has been described by the point where properties have declined 40% from highs. The sales and asking prices, here in Palm Coast, are at and below that level. You now can buy a two year home on the lot for around $50 a square foot.To build it it would cost around $125 a square foot. These are indeed bargans, although some say it is not the bottom yet. I see more buying as mortgage rates are bottoming and this is not a bad place to live. The stock market, obviously, is more risky than housing, so yes, it is a good time and price so why not buy.

  2. Toby
    Toby says:

    Reply to George

    Your thoughts are along the right lines, but I’ve never heard the bottom described as a 40% price decline. Most declines in the housing markets stop before reaching 10%, which is why the present drop caught so many of us by surprise. The bottom is simply where the prices stop dropping and eventually rise again. Your observation that this is a good buying opportunity is right on the money.

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