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Don't take my word for it....noted economist Hank Fishkind, who focuses a great deal of attention on the Florida real estate market said yesterday (Aug. 30, 2007) that he still believes the market reached the bottom months ago.  He backs this up with statistics that show the following:

1) The sales of existing homes in Florida have now been stable for 7 months in a row.

2) Housing starts in Florida have stabilized over the last six months, and last week's report on new home sales confirm that the market has bottomed out.  Sales increased 2.7% and inventory of new but unsold homes decreased.

Fishkind maintains that the economy is stronger than the news reports would have people believe.  He doesn't believe that Florida will see further price declines over the next 18-36 months, although he does believe that prices may remain flat in many areas.

What about Northeast Florida?  Well, Fishkind didn't comment specifically on Northeast Florida, so I will give you my opinion.  I believe the real estate market in Northeast Florida will recover faster than most other parts of Florida.  We are overbuilt, but nowhere near to the extent that South Florida is.  Prices have already adjusted in most areas, and will not fall significantly from this point.

Condos away from the beach will not see any significant price increases for several years.  In fact, they could decline in value even more.  New construction prices for single family homes will remain stable in most areas, but could decline in other areas with fewer qualified buyers and high inventory levels.  Some areas, especially areas that are unique with minimal supply of raw land to develop will recover quickly over the next 6-9 months.  

We need to keep a close eye on the mortgage markets, as availability of loans and rates will play a large role in how many buyers come into the market.  Recently we have had bad news in regards to the mortgage market, however many believe we have seen the worst of it and things will get better soon.  I believe we will see the Fed drop rates at some point in the near future in order assist with the recovery of the housing market.

Todd Gifford - Copyright © 2007

Source for some of the information in this article: Florida Association of Realtors