Perhaps it’s the $8,000 first-time tax deduction courtesy of Mr. Obama (?!!?)
Just in the last few days, I have seen a ‘bottoming out’ in many neighborhoods around here. While some homes are still overpriced, the lower priced homes are starting to move and these bank-owned houses are now turning—which means they are setting true comps for the neighborhoods.
Just yesterday I was showing homes in Summerport- which I consider to be the poster-child for real estate communities hit hard by the boom. Homes there were built in 2005-2008 and some people paid literally double what the homes are worth. Drive through the neighborhood and you cannot help but notice the huge number of vacancies. Some homes are well taken care of with manicured lawns and others are overgrown with weeds and the homes are neglected and abandoned. As of this writing there are 61 single-family homes for sale in Summerport. One of the four I showed yesterday is a bank owned house that was purchased new in Feb ’07 for $465,000. It’s a 4 bedroom 2,644 sq feet home with a 3 car garage in pristine condition listed for $204,900. It was just listed Friday. There’s an identical house-also a bank owned- listed down the street that was $208,900 and it went pending in 7 days. I expect this one to do the same.
Also down the street is another 4 bedroom bank owned also listed Friday for $208,900 – it’s a bit smaller but has a pool – and is not even half as nice as the one for $204,900. In a 45 minute span of time, it showed 4 times – something I have not seen since the housing boom. Literally, we had to wait to show the house and there were people outside waiting for us to leave. Crazy. And yet a third house I showed, also a bank-owned, also listed the day before, had 7 realtor cards sitting on the counter. And we were there at 10 am on Saturday. It was priced at $192,000. Looking at the comps, the homes in the $200,000 range are (finally) selling. One agent I spoke with has 7 short sale listings – all homes are similar in size- 3 bedrooms with a bonus room or 4 bedrooms under 2,100 square feet – all priced in the range of $195,000 - $205,000. He tells me the bank has told him the recent comps – and there are several – show the lowest they will go is $197,000. So it appears that is the bottom for that neighborhood.
A similar scenario is playing out in nearby Lakes of Windermere- but that neighborhood seems to a little farther along in the recovery process. The bank-owned houses are moving faster and prices have certainly leveled off. There is a long list of homes still for sale and those prices will continue to fall until they reach the vicinity of these bank-owned comps. I doubt prices will rise until the supply of bank-owned homes are completely gone and then we’ll start to see a gradual increase. But that – as many experts agree – likely won’t happen until 2010.
But for first-time buyers or investors still waiting for the market to hit rock bottom, look around, I think we're here.