Florida Real Estate Prices Rise
Florida real estate prices are on the rise, finally. Parts of Tampa Bay have seen increases as much as 5% a month over the past quarter. The increase is due largely in part to a reduction in inventory throughout the state of Florida. The other major factor is the increasing demand for any form of real estate; whether it be single family or multi-family. Surprisingly enough, short sales are also to thank for the increase in prices. Typically, Tampa homeowners feel that short sales and bank owned/REO properties drive prices down. However, this is not always the case. There is a common misconception that a short sale is a bargain. In reality though, the bank approving the short sale is looking for market value, and will rarely accept a “low ball” offer just because the property is a short sale. Furthermore, if an individual or group of investors owns a note, rather than the bank, they tend to be even less motivated to accept a short sale. These third parties do not get the benefits of the government bailouts, and will generally only accept whatever figure they determine is appropriate. Accordingly, it is possible that a short sale would set the trend for a price increase in a neighborhood. Moreover, as banks become more willing to accept short sales, it helps to dry up excess inventory and drive prices up across the board.
While the market surely appears to be heading the right way, real estate experts speculate that we are still about a year away from a recovery. The instability of prices in the market place supports this thesis. Experts say that some houses are selling over listing price in just a few days, while other houses sit around for months and end up selling well below market value. Ultimately, the instability makes it difficult for buyers to know what to pay, and some are still skeptical. Nonetheless, we are starting to see hammers hit nails again, and the interest in real estate appears to be back. Stay tuned, because the next year should be very interesting.
Please be advised that this article does not constitute legal advice nor does it provide any basis to form an attorney-client relationship. Nothing in this article should be copied without the express permission of the author.