“First in, first out” is a popular phrase in the Florida real estate industry. In a state hit early by the economic downturn, there’s hope it will be on the leading edge of a recovery.
Construction and real estate play big roles in the state’s economy.
Emerging Signs Of Hope
But those who follow the real estate market here are starting to see some signs of hope. The increase in sales has been especially notable in Cape Coral. The Florida Association of Realtors reported a 43 percent increase in January over last year’s sales in Lee County.
After a devastating 2007, prices began dropping in 2008 and the market responded.
Steep price declines have encouraged first-time homebuyers with good credit, and lots of investors. In recent months, prices have begun to flatten out.
Signs of A Shrinking Inventory
And here’s a positive sign: Even with hundreds of foreclosed properties coming on the market each month, the inventory of houses that are for sale is shrinking.
At current rates, there’s now just over a 12-month supply of houses for sale in Cape Coral. That’s still higher than the three- to six-month inventory typical of a healthy housing market.
But Jeff Tumbarello, who studies the market for the Southwest Florida Real Estate Investment Association, says it’s becoming harder to find real bargains.
Attracting Investors
Matt Zacharias, a general contractor from Lancaster, Pa., had some luck. He recently bought a three-bedroom, two-bath home with a pool and its own boat dock. He paid $182,000. Sixteen months ago, the house sold for more than $500,000.
“The market down here, the prices are just too good to be true,” Zacharias says. “I had to come down and check it out for myself. One thing led to another and here we are — I’m actually going to look at another property later as another investment property.”
Affordable Housing Returns
“Affordable housing is back. That also attracts business. It also attracts residents to come into our area. We should take advantage of that and we will.” says Mayor Jim Burch
Burch isn’t quite ready to say that Cape Coral has reached the bottom of the housing market, but he believes it’s probably not far away. “We do believe in the first in, first out theory: We were the first in, without a doubt and we think, right now, we’re getting ready to be the first one to come out of this,” he says.
A Cautionary Tale
Economist Hank Fishkind, like others who watch the housing market, notes it’s not possible to know you’ve hit the bottom except in hindsight, after prices have begun to rise. He agrees though that Cape Coral is probably close to the bottom.
source: npr.org
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