Housing prices will hit bottom in the fourth quarter of 2009, predicts Moody’s Economy.com in a new report. “Despite the darkening national economic outlook and the weak conditions in the housing market, some positive signs give hope that a bottom in the housing market is coming into view,” the report says. On average, home prices will decline 36 percent from the peak in the first quarter of 2006, the report says. By the end of the housing downturn, nearly 62 percent of the nation’s 381 metropolitan areas will have experienced double-digit-percent declines in house prices, peak-to-trough, says the report. The declines will exceed 20 percent in about 100 metro areas, according to the report, and the recovery will be “lackluster.” “A number of uncertainties in both the housing and economic outlooks remain, and the risks tilt to the downside,” says Moody’s Economy.com Chief Economist, Mark Zandi.
A recent newsbreak indicates State Farm Florida is pulling out of the homeowner insurance business in Florida. This is a surprise move that will leave more than 800,000 policyholders without coverage and will cause almost certain turmoil in the Florida insurance marketplace.
State Farm Florida president, Jim Thompson, claims they're "faced with steep declining resources to cover future claims and expenses" and says the company "...has little choice."
Thompson said the company's plan requires regulatory review, and State Farm Florida will not begin dropping policies under the plan until that process is complete. Florida, however, has no law on the books that would prevent State Farm from leaving the state's homeowner insurance market.
State Farm Florida emphasized that it was submitting a two-year plan that seeks to limit disruptions for customers, and if approved, will allow them time to find coverage with other insurers. (State Farm is Florida's largest private homeowner insurer, second only to state-sponsored Citizens Property Insurance Co.)
State Farm is also Florida largest automobile insurer with more than 3 million policies. The company says it will continue to offer auto coverage. However, a 2007 state law pushed by Gov. Charlie Crist prevents insurers from offering only auto policies if they offer both auto and homeowners in other states. And so it SHOULD be! If they want Florida's lucrative auto insurance business, they should offset that with the POSSIBILITY - not certainty - just POSSIBILITY of potential homeowner losses.
Seems as though State Farm wants their cake - and wants to eat it too. I say - NO WAY!
Company executives are reporting FNMA is testing a new "short sale" program aimed at reducing the number of foreclosures by pre-approving sales where homeowners sell their houses for less than the amount owed. How will it work? No one is totally certain yet - but - the plan is to have a branch of the company be responsible for determining an acceptable listing price (for a so-called "short sales") even before a buyer has been found. Is is a smart move? Only time, and submitted offers, will tell.
Homeowners who are having trouble staying current on their mortgages may get some help from the Economic Stabilization Act. The law authorizes the government to work with mortgage servicers and struggling borrowers to modify the loan terms on the mortgages the government owns.
The new law expands the FHA homeownership program as part of the economic stimulus package. Under that program, borrowers facing foreclosure can refinance into FHA backed financing IF the original lender writes down the balance of the mortgage to the current market value,. In some instances, the current market value may be greater than the short sale offers being made from investors to the banks. Another benefit is that current homeowners would get to keep their property at today's market value. And if history has taught us anything - it's taught us that property values WILL rise again.
This program is DEFINITELY something owners should consider and address with lenders should they find themselves having trouble staying current with their mortgage and facing possible foreclosure.
Several months ago, we reported in the HotSpot NewsNote, that state Legislators passed a pilot program allowing municipalities to issue special permits for "doggie dining" areas. Not many moved forward. Now, however, the Panama City Beach City Council passed the first reading of a new law that will allow authorized restaurants to accommodate dogs "in special outside dining areas."
It seems as though several of our council members were approached by local eateries (particularly in the Pier Park area) to establish the permitting process - and why not? Plenty of outside activities ... plenty of sunshine ... plenty of grass ... and increased traffic from the canine lovers of the world!
Yes - there are some strict rules that accompany the new law - but, it should be fun. Who knows, we might even progress to frisbee tosses and obstacle courses - that'd be a BLAST!
Times … they are a changin’! The stock market sucks! Some banks were so overextended – the Fed stepped in and closed them down. Even FNMA and FMAC were in such dire straits that the government had to bail them out. So, waddawedo now?
First – we need to recognize we’re in a recession. It happens. I think the last one was in 2001 (albeit a modest one). Anyone over the age of 50 probably remembers their parents talking about the great depression. (1929-1933). My grandfather had been in America for less than 10 years and was a furrier. To make ends meet, he & my grandmother lived atop their store in a small apartment, worked sales and manufacturing alone and saved what they could. They kept most of their discretionary income in a shoe box, big envelopes and a mattress – after all, nobody trusted banks!
This certainly is NOT a time to keep money under your bed, in a mattress or buried in the backyard. If you’re one of the lucky ones who has some “ready cash,” it’s time to buy if your credit’s okay. Especially real estate!
Whether it be a vacation home or vacant land for use or sale at a later date. When the recession ends (economists are predicting this will be in the not too distant future), the value of real estate will rise again as it always has.
Many of the folks we come in contact with feel there’s no better time to start building equity in real estate … to own a little piece of this earth. Only one problem, many of them live in urban sprawls, like Atlanta, where the pace is quick, the traffic unbearable, and the prices outta sight! So, what are more and more of these folks, unhappy with the stock market, starting to do? Contact WealthCreation in an effort to buy a place outside the city… near the coast. Not vacation homes or rental properties alone – but – vacant land as well. Historically, vacant land has proven to be a valuable part of balanced portfolio. And, in today's market - vacant land is VERY affordable!
Over the past year, the number of homes and land bought for investment purposes has risen and the number is still growing. While some of WealthCreation’s sales have been due to increased speculation, market analysts believe that both first time home buyers AND aging baby-boomers are buying away from the urban sprawls. Their options? Buy a summer home, vacation rental or plot of land where they plan to retire.
What should you look for? (1) Know your market. Talk to your Personal Real Estate Consultant (that’s us!). Is the area growing? What are the comps? What type of appreciation can “reasonably” be forecasted in today’s market? (2) Know what extra costs you may face. In addition to property management fees, don’t forget you’ll also pay property taxes and, in some cases, community association fees as well. Adjust your financial calculations accordingly. (3) Ask questions about what you can expect should you decide to rent the property. Not everyone will have family or friends close by to watch over and help with their rentals. Property management companies charge as little as 5% or as much as 50% depending on the service provided and property location. B-I-G difference!
Successful investors, with full lives, face the same frustrations and hurdles as everyone else. The difference is the way they handle their “indecisions.” Rather than feeling immobilized by their worries, successful people conquer them. They know “You Can Make Money or You Can Make Excuses – But – You Can’t Do Both!” After all – according to Dr. Richard Carlson, courage is best described as being afraid and “doing it anyway.”
Make this New Year Prosperous. Resolve to Step Up…Ask Questions…Get Involved…Make Reservations … Decide … & as Nike says … “Just Do It! “
This year will be a first. Pier Park will be closing their streets to vehicular traffic. Margaritaville, in conjunction w/businesses owners and marketers at Pier Park, will host a street festival complete w/live music, food, stilt walkers, face painters, and other festivities beginning at 5:30 PM New Year's Eve. The Beach Ball Drop will occur at midnight coupled with a fireworks display over the Gulf of Mexico. Simon Group marketers are hoping to make it an annual event. I, for one, intend 2 go. C ya at the Park!
Over the past year or so, foreclosures have had an unintended effect on renters ... their eviction. Homeowners, looking to get every last dime out of a sour investment, rent their homes ... the owner doesn't pay the mortgage ... never divulges, to the unsuspecting long term renters, the home is in foreclosure proceedings ... then ... renters get served notice they've got 30 days (sometimes less) to vacate. No reprieve! Well, now, it appears, there IS a reprieve on the horizon.
FNMA and FMAC are finalizing a plan to help renters stay in their homes even if the owner enters foreclosure. Under the new plan, renters, who show they can afford the rent, will sign a new lease with FNMA or FMAC while the property is up for sale.
While to us laypeople this policy makes perfect sense ... you have to wonder who, at these quasi-governmental agencies, thought it up, presented it and sold it to their superiors. In the 28 years I was associated / employed with the Federal Govt ... they were NEVER this accommodating! All I can say is - it's about time! I guess some negatives DO produce some positives.
Last year, if your credit score was “tarnished,” the Federal Housing Administration didn’t care. You could obtain a house loan credit score “sight unseen” … not any more. The financial problems on Wall Street coupled with the housing crisis have, as most Americans know, forced lenders to tighten the credit reins. Never before has a good FICO Score been so important. It takes time to build up a credit score. And you need to remember that NO ONE can look out for you better than YOU can!
Check your credit. Get your free annual credit reports . Pay attention to mistakes – get them corrected.
Retirement hot spots like Panama City Beach and the State of Florida in general, have been hit with falling prices. There are tens of thousands of homes for sale which means that in today's market, there's a lot of choice ... and room to bargain. For those folks looking to relocate or retire in the next few years, we'd suggest you vacation with us this winter. Check out our market. In the 2 to 3 years it'll take you to relocate, prices and rates are likely to rise. In our market, for instance, recent RealtyTrac and MLS searches indicate Panama City is showing signs of a slowing inventory and firming of prices.
Growth is bustling in Panama City Beach, but the area’s beauty remains unspoiled. Once a tiny, lesser-known, rural area, Panama City Beach, Florida today is well known for its sugar white sandy beaches, emerald green waters, lagoons and rivers, venues for recreational boating, sailing and fishing. What makes folks want to come back time and time again is the reality that still much of the area is undeveloped and, oh, so pristine. Thanks to the State of Florida, Panama City Beach enjoys neighboring St Andrews State Park that includes picnic pavilions, camp sites, dedicated reefs (enhancing one’s snorkeling and scuba diving experience), restrooms, showers, a boat launch, piers, a bait shop and a dedicated venue for shell collectors, and Shell Island, accessible only via the connecting waterway by boat. If you’re into fishing, you can wet your line in both fresh and salt water in the Panama City Beach area. With any luck, you’ll reel in bonita, king mackerel, speckled trout, mahi-mahi, and/or pompano. Both off shore boat excursions and stationary pier fishing are available. Panama City Beach boasts outstanding restaurants, antique shops, flea markets and art galleries with more businesses relocating here everyday. The area lies between the planned paradise development Seaside (the location of the 1997 hit motion picture “The Truman Show”) and Apalachicola (home to the BEST and MOST RENOWNED oyster beds in the State). Once you have experienced Panama City Beach yourself, don’t be surprised if it sneaks into your mind long after you’ve returned home. Pristine beaches, salt air, quiet days and gentle breezes have that legacy.
The Fed cut it's discount rate to near 0% yesterday. There is not much more ammunition left in the Fed's arsenal to make further cuts and investors wonder what they can do next to shore up our credit system. If you have a prime-based HELOC, that does not have a "floor", you should be turning cartwheels today, but don't expect too much to happen with mortgage rates.
The financial markets already anticipated a cut of 0.5% and that effect was factored in to today's rates. This morning, the market is poised in anticipation of wiping out most of the yesterday's gains as the realization that, "It may not do that much to help" sinks in. On the flip side, if the stock market continues to rise, demand for the Tbills will drop off and could conceivably send those yields up. (Complicated system - that does NOT favor the little guy!) So, a continued rise in stocks MAY put downward pressure on the price of Tbills and drive mortgage rates back up. (Isn't this fun!)
Suffice it to say, the short term psychological reactions will wane very quickly. This FED rate drop will most likely be "short term". Then, as the markets re-gain their composure, rates will return to their previous levels and erase those short term gains. What's the good news?
Rates will still remain at historically low levels; and, we could see a much slower trend downward. But, most likely Banks and Lending Institutions will hoard the spreads to try to recover some of their huge losses in their servicing portfolios and investment banking divisions. (Opportunistic SOB's!)
To become a fact, the 4.5% mortgage (that seems to have everyone's attention) would require extreme intervention by the Fed. We all got wind of that # in the press over the last couple of weeks. What it did was actually slow the recovery! How? Buyers who were otherwise comfortable with the rates in the (historically low) mid 5% range and were ready to buy have now moved back to the sidelines in anticipation of these low rates. It COULD happen, but according to one of our local professionals, the general feeling is that "Even if the FED starts buying mortgages directly, the banks will still try to figure out how to pocket the spread and increase their miserable bottom lines."
With rates at an average of 5.25%, the difference in the payment will be around $45.00 per $100,000. I think when consumers become aware of what that monetary difference is, it will change their perception of whether they need to wait around or not. Now IS the time to buy!
(Special Thanks to Grady Brown, Wells Fargo Mortgage Consultant, for this content; For addntl info - 850-522-6162)
Do some homework and your research will show you Panama City Beach is where many Americans are moving and real estate, although tempered with today's market, is still projected to boom! This “hot little town” not only offers everything from good education to affordable housing, but a solid military presence (NAS Panama City and Tyndall AFB) and a growing job market as well. Most investors, retirees and job seekers hunting for the right town in the sunshine State are seeking an area capable of providing a tempered lifestyle, warm weather, excellent hospitals, crystal clear water, and distinct weather seasons. Panama City Beach has it all!!
According to Renee Rackett, Broker/Associate WealthCreation, "As more people are exposed to this area through vacationing, more want to make a permanent investment by buying a second home or condo. Armed with disposable income, these individuals are turning to the Florida Panhandle and Panama City Beach. The coastal market is shifting. Destin, San Destin, and Perdido Key buyers are heading east. So, shoulder markets, such as Panama City, are now benefiting from buyer’s hunger."
We believe knowledge and information is power – so, we try to stay in contact with you … our buyers … to keep you up to date on the happenings in this area. If you haven't been here lately ... you haven't been here! Happy Holidays!
If you missed the auction this past week-end at Origin of Seahaven but you'd like to get in on the "steal" ... you're up that well known tributary without the proverbial paddle! "Incredible" is the only word that comes to mind.
The first sale was a 3 bedroom unit for $270,000. At 1781 sq ft, that makes the square foot selling price of that unit $151.60! The next unit, a 2 bedroom condo, sold for just over $200,000. At $201,000, the 1306 sq ft 2 bedroom 2 bath unit fared only slightly better than it's 3 bedroom sister. It garnered a mere $153.90 sq ft.
I guess I shouldn't be too surprised. I mean, Palazzo and Ocean Reef sold for just over $200 sq ft and they're beachfron properties. Seahaven, while of first class construction, is, in fact, not Gulfront, rather Gulfview. As such, probably should command a 10% discount. Even so ... buyers at Saturday's auction finally got what Ocean Reef, Marina Landing and Palazzo failed to deliver ... condos at an "Absolute" auction for a bargain basement price.
Yesterday, the national average rate on a 30-year fixed rate mortgage fell to 5.49 percent, down slightly from 5.54 percent on Tuesday, according to financial publisher HSH Associates. Rates. Also, yesterday, the Mortgage Bankers Association said mortgage application volume dipped about 7 percent last week after soaring a week earlier. People are beginning to take a "wait-see" type attitude. Falling interest rate significantly effect mortgage notes homeowners pay ... a 1/2% decrease can mean hundreds of dollars in savings for prospective Buyers.
Lower prices in some of the hardest hit markets, and almost irresistible bargains on distressed properties, are bringing some buyers out of the woodwork.
Conversely, lower mortgage rates also could prevent housing prices from dropping as much as they otherwise would. That would mute their effect on the overall economy.
Unlike our sister states, when it comes to condos, Florida real estate professionals have long held the best way to determine the "health" of a market is by examining the price per square foot. Price per square foot is much more relevant than the sales price. For example, while a 2 BR / 2 BA unit at Emerald Beach Resort may sell for $292K; and a 2 bedroom at Shores of Panama for $255K, it's important to note the unit at EBResort unit is 1299 sq ft while the unit at Shores is 1063 sq ft. So at $225 per sq ft vs $240 per sq ft (in this example, only) the Emerald Beach unit would be a better deal. For those interested in the "health" of the respective markets in the Panhandle, a recent comparison of NWFlorida markets yielded the following: Condo units along San-Destin's 30-A corridor (Seaside, WaterColor, etc) had the highest resale value at approx $415 sq ft, followed by Okaloosa Island and Pensacola Beach at $384 and $378 sq ft respectively. Panama City Beach was last at $230 sq ft ... driven down, primarily, by the current auctions clearing excess inventory. The good news is that inventory levels in Panama City are nearing 2005 levels - terrific news for sellers.
In Dec's HotSpot NewsNote we'll be covering this topic in greater detail. Suffice it to say, while, at one time, there was quite the concern over Panama City stealing Destin's tourists, businesses and the like ... concerns have settled. Panhandle cities seem to ALL be excited about the possibilities that are prophesied to accompany the new airport. Some, already, seem to be bearing fruition. The increased publicity has spurred a new interest in the area by both investors and the media. Want to learn? Sign-up to receive our monthly HotSpot NewsNote.
On December 13th, 2008 an auction will be held on site at Origin, the Towne of Seahaven. They will sell 29 condos with over 60 to choose from, including 2, 3, and 4 bedroom options. It is being advertised as no minimums and no reserves with the auction to begin at 11 am CST. Registered bidders are expected to bring a deposit and pay a 10% buyers premium on top of the final auction price.
Edgewater Beach Resort’s been the premier resort in PCBeach for nearly 3 decades. You’d think, with all the new developments, they might be losing some of their luster. Not so. Long a magnet for social, recreational and business events, it’s no surprise Edgewater Beach Resort is planning the first of several “facelifts” between now and Spring 2009. The 32,000sf Convention Center will be upgraded; a children’s pool with a water feature will be added; a new sports complex; tennis courts will be resurfaced and exterior improvements to both the resort towers and landscaping are on the books.
Tower I and Tower III have been up and running for some time now and if “butts on beach chairs” are any indication of success, Emerald Beach is VERY successful. While several issues still exist with regard to Board of Directors vs Wyndham vs Owner priorities, THIS project will (unlike Boardwalk, Tradewinds, Seahaven and a few others), it seems, be completed. With approx 800 feet of Gulf-front, Emerald Beach is the largest Resort development in PCBeach.
Corus Bank took possession Oct 1, 2008. Certificates of occupancy have been received for the entire project. Only 60 units are listed as sold. Current estimates indicate an additional $10 million is necessary to complete the building. From what we’re being told, Corus intends to furnish approximately half of the unsold units making them available for rent.
