Brevard Market Trends

April 2008 Report

Headlines: Last Chance to Buy at Low Rates!

Anticipating soaring inflation, smart money is rushing to real estate. In March, sales hit their highest volume in 7 months.  Locking in low interest rates, and a population moving to rentals, is finally making landlording feasible again. Home ownership will soon get very costly as mortgages rise from today's artificially low interest rates. Lock in that 30-year fixed rate mortgage NOW!

Brevard demand is driven by vacation/retirement homes for baby boomers PLUS a high-tech jobs base. Our embedded base of working renters makes Brevard a much better investment than retiree-dominated communities.

As we replace the shuttle program,  NASA is preparing new facilities for Constellation, the next launch system after Shuttle. Click to watch an overview of our next bold step into space.

The annual end-of-year dip in purchases was particularly harsh this year as buyers awaited the outcome of the Jan 29 vote on Amendment 1 that makes the cost basis on "homesteads" portable to a new purchase. Floridians were "locked in" to their homes until portability passed. Year-end sales activity was dismal, but January/February buyers have phones ringing off the hook. Watch for a surge in spring closings.

We insiders know living on the SpaceCoast is fantastic! Now everyone else is discovering the secret about favorable real estate values in Central Florida. This comprehensive monthly report shows you the investment potential that accompanies owning property in Brevard County.

December average sales prices usually drop as a reflection of Winter panic. The Condo Prices graph (see below) shows condo average sales prices down because sales over $500k are 5% of today's market compared to 11% of the market 6 months ago, while sales of units under 1,000 sqFt remained constant. Compare to an upward price spike in June due to an extraordinary 16 condos that sold in excess of $500k, two of them in excess of $1.5mil. August saw a similar, but less significant, up-spike.

Contrary to what you read in the press, we studied premium waterfront home sales and discovered that on Indian River, Banana River and Newfound Harbor, sales prices are still rising and volume matched robust  '05 levels. The same pattern holds true in Indian River County to our south.
Year Average Sale Price Number of Sales
2005 817,000 69
2006 895,000 32
2007 1,004,000 65

Perspective  It will take awhile until all the panicked sellers are out of the market. Although some had to sell immediately and temporarily pushed the market down hard, many sellers are unwilling to drop prices in anticipation of a renewed upward trend.

Government bail-outs induced irresponsible lenders to give undeserved mortgages to irresponsible buyers who cannot, or will not, honor their commitments. Sales of those units are simultaneously pushing prices down. 

Our stats show homes are still selling at 95% of asking price. When the asking price is set realistically a large number of homes have sold at full asking price.

Leading Housing Indicator Excess inventories of new homes drove Brevard prices since July '05 and remain a dominant force in today's market, followed closely by "short sales". Our proprietary Building Permits Graph and Statistics (Housing Starts) says the end of the new-home glut is in sight. Brevard builders recognized an inventory buildup and began severely reducing construction activity in June '05.  Permits declined from a peak of 1066 per month in June '05, to less than 150 in recent months, therefore finished inventories are declining but some builders are seizing an opportunity to get back into action.

For now, new completions continue to enter the Brevard market and keep new-home prices down. While adding to that oversupply, a few makeovers tend to raise some resale segments (especially waterfront) significantly.

We've been amazed at the strength of the market in the face of large inventories and some desperate sellers. Prices of single family homes remained surprisingly high in spite of For-Sale inventories five times greater than at the peak buying frenzy - but here's the good news...

 As we predicted, the MLS inventory of unsold homes and condos continues to decline. Yea!

March end-of-month MLS inventories rose far less than the expected immediate increase from the portability amendment.
       7175 Single-Family down 10% from the highest inventory
       2180 Condos
down 26% from the highest inventory

A total of 3,000 would be in balance. Since January 1 we are back in the buying/selling season - this is when prices seasonally start to rise. 

When in a Buyers Market - BUY. The real beneficiaries have been the smart buyers, buying while prices and mortgage rates are low and everyone else was afraid to buy.

Spurred by yet more government intervention, interest rates on 30-year fixed-rate mortgages still hover around 6% range providing an unprecedented buying opportunity.

Hottest Markets  After three years in the top ten, Brevard county's 2005 ranking finished fifth hottest in the country; our ranking for 2007 fell to bottom five. The good news is that there are now 76 market areas more expensive than Brevard, so Brevard affordability is much more reasonable than theirs.

House Price Index (federal measure of repeat mortgage appraisals of homes under $417k) Brevard appreciated 71% over the last 5 years. For 2007 however, we were down 11.36%

Brevard #1 in Job Gains
Miliken Institute's Best Performing Cities Index said Brevard topped its list where components measure job, wage and salary, and technology growth. High-tech and construction jobs lead gainers. This assures continued strong housing demand.

What is this home worth? These graphs and charts reveal what's happened lately, by type of home. If you'd like to know why, see my Real Estate eMagazine for a discussion of solid economic fundamentals powering the rush to the SpaceCoast, and various neighborhood lifestyles drawing people here.

 

 
Hot Markets Moving UpCall Richard Webb at
321-480-5514 for essential market expertise, recent updates to these numbers, and projections of future trends.

 

Hot Housing Markets

Eight Florida markets led top-ten gainers in 2005. But what goes up will also come down. 

 
Top Ten 2005   Percent increase 
 Phoenix/Scottsdale, Az    46.0
 Cape Coral/Ft Myers, Fl    43.8
 Orlando, Fl   43.6
 Sarasota, Fl   38.5
 Brevard County, Fl     36.2
 Deltona/Daytona/Orm, Fl   30.6
 Ocala, Fl   30.3
 Tucson, Az   30.3
 Miami -:Lauderdale. Fl   29.6
 Tampa - St Pete, Fl   28.6
U.S.average   12.6
 
 
 Source Data : National Association of Realtors, 
 

 

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The Best Information - Gives You a Winning Edge.  I built these graphs to give us some perspective on market forces setting the prices on homes, and to help our clients negotiate the best possible deal. These Brevard county-wide residential sales, by fellow members of the both Boards of Realtors, chart the leading edge of Brevard's overall real estate market.
Note: The following numbers include many newer, larger homes and pull the chart higher. Older less expensive homes, and extreme luxury homes will perform lower, and homes on navigable waterways will perform higher than these averages.

When in a buyers market, smart people BUY

.What is the average sale?

Last chance to bag a bargain in Brevard! We rank #71 in Median Prices, far below other desirable markets, and below the national average (still a bargain). 
Real estate (which you control and enjoy) appreciation sure beats gambling in the stock market - and you can't enjoy a stock certificate! 

Source Data: MLS. 
Graphs updated mid-monthly

 

Don't Miss the Bargains!

December average sales prices usually drop as a reflection of Winter panic. This Condo Prices graph shows condo average sales prices down because sales over $500k are 5% of today's market compared to 11% of the market 6 months ago, while sales of units under 1,000 sqFt remained constant. 

With only 70 condo sales a month countywide, these numbers are erratic

 

.When should I Buy/Sell?

Buyers get serious from early January till just before school starts in late August. See Buyer Activity Graph

Really astute buyers look for bargains during slow periods. Timing can affect the price. Expect Spring price increases.

Remember: settlements show on this chart 30 to 60 days from the time the deal was struck. See Buyer Activity Graph

Source Data: MLS. Graphs updated mid-monthly

Pick Your Home Averages are good for perspective, but can blur the picture. Look at the following charts to help you focus on categories of homes you're interested in, then call me for help finding the specific one that fits your requirements.We factor in date-sold in a way that enhances rather than confuses the analysis, and shows exactly what you should pay.

Waterfront homes offer the best appreciation potential. Unlike continually expanding developments in former cow pastures, they're not making any more navigable waterfront.  Including all the islands, we have 230 miles of coastline, and that's it, so prices get bid up faster on waterfront homes. In most areas we're seeing neighborhoods upgrade as investor-refurbishers buy homes built in the early days of the space program, and modernize them. Renovations push values higher.

Vacation and investment property above $400k is in highest demand. Near-retirees establishing a beachhead for retirement, or beginning to move to Florida, want high-end homes and condos. They appreciate faster than blue-collar homes as a result.

Note: Some people mistakenly try to use the tax appraiser's values as a guide to home pricing. That will not work in Brevard. The appraiser's Market Value and Assessed Value offers no predictable relationship to sales prices as evidenced by my Appraiser Ratios analysis (click to see).

Is Demand for Real Estate Ending? Not in Florida! Not when 900 people per day are moving to Florida, already the 4th most populous state. The baby boom started in 1946 -- add 65 years and we will begin seeing baby boomers (who for decades have dreamed of moving to Florida) retiring in 2011. Many current home shoppers are early retirees, and those who plan ahead (a characteristic that made them successful in the first place) are purchasing now. Each time the Fed chairman raises interest rates to curtail what Greenspan called "froth" and "irrational exuberance" the press predicts the end of the housing boom - but not in Florida.

Kiplinger's 13 riskiest housing markets were characterized by extremely high-end prices, reduced local employment, and people leaving. Brevard shares none of these characteristics. In fact our 3-year jobs growth is 7.1% versus the national average 2.4%. The following chart shows the housing demand created by new jobs. Add to that the huge demand created by retirees and second-home buyers and you get a demand for homes pushing prices ever higher.

Brevard County Housing Starts

source: National Association of Realtors

New Economics Did you notice that the largest credit card issuers doubled their minimum monthly payment?  A brilliant new monetary strategy! That's one great way to curb inflation! It cuts consumer mis-spending, and it had to be done with quiet government sanction; otherwise banks would have been in illegal collusion. This is a revolutionary method of reducing borrowing in precisely the sector that defaults on debt due to their irrational exuberance. It has been more effective than the Fed increasing reserve requirements to curb lending. We'll be watching its positive effect on inflation and interest rates, while expecting the press to whine about negative effect on credit card borrowers and how consumers are not spending enough.

Investors Call Richard Webb, a fellow investor, for expert help selecting properties with the highest total return in your portfolio. Sometimes half of my buyers and sellers hold real estate licenses in Florida or other states. I am a Realtor's Realtor backed by an office of 140 specially selected and trained agents in 7 offices of the Coldwell Banker Ed Schlitt Realtors team, the most respected professionals on the Space and Treasure coast. We're everywhere you want to be along the Indian River.

 

MAAR Waterfront Home & Condo Sales

Realtor's MLS system no longer produces these numbers                          Res = Single Family Residential   Att =Attached Condos/Townhomes.    Number is units sold.

2005 Prices thru Dec 31

2004 Prices 2003 Prices 2002 Prices
Indian River Res - 107 Att - 163
Avg. Sales Price $848,767 $439,889
Sales Price per/sq.ft. $337 $219

Banana River Res - 76 Att - 154
Avg. Sales Price $804,566 $354,495
Sales Price per/sq.ft. $311 $225

Sykes Creek Res - 48 Att - 7
Avg. Sales Price $510,414 $292,685
Sales Price per/sq.ft. $245 $173

Lakefront Res - 927 Att - 189
Avg. Sales Price $360,490 $228,977
Sales Price per/sq.ft. $168 $162

Ocean Front Res - 25 Att - 439
Avg. Sales Price $1,238,768 $482,233
Sales Price per/sq.ft. $476 $300

Newfound Harbor Res - 7 Att - 0
Avg. Sales Price $522,142 $0
Sales Price per/sq.ft. $231 $0

Canal - Navigable Res - 246 Att - 36
Avg. Sales Price $564,860 $332,790
Sales Price per/sq.ft. $265 $236

Canal - Drainage Res - 224 Att - 43
Avg. Sales Price $233,510 $152,152
Sales Price per/sq.ft. $137 $144

Other Res - 128 Att - 98
Avg. Sales Price $347,342 $254,200
Sales Price per/sq.ft. $188 $186
Indian River Res - 122 Att - 165
Avg. Sales Price $823,143 $337,290
Sales Price per/sq.ft. $278 $181

Banana River Res - 80 Att - 155
Avg. Sales Price $743,230 $265,438
Sales Price per/sq.ft. $246 $180

Sykes Creek Res - 60 Att - 7
Avg. Sales Price $386,377 $238,750
Sales Price per/sq.ft. $203 $179

Lakefront Res - 905 Att - 158
Avg. Sales Price $286,032 $181,525
Sales Price per/sq.ft. $132 $130

Ocean Front Res - 34 Att - 558
Avg. Sales Price $1,194,367 $382,848
Sales Price per/sq.ft. $411 $243

Newfound Harbor Res - 12 Att - 3
Avg. Sales Price $570,758 $257,333
Sales Price per/sq.ft. $233 $152

Canal - Navigable Res - 273 Att - 46
Avg. Sales Price $453,105 $234,013
Sales Price per/sq.ft. $212 $163

Canal - Drainage Res - 199 Att - 5
Avg. Sales Price $165,491 $150,660
Sales Price per/sq.ft. $101 $108

Other Res - 185 Att - 125
Avg. Sales Price $264,243 $161,941
Sales Price per/sq.ft. $136 $142
Indian RiverRes - 95Att - 125
Avg. Sales Price$487,523$161,857
Sales Price per/sq.ft.$197$118

Banana RiverRes - 83Att - 135
Avg. Sales Price$487,976$194,774
Sales Price per/sq.ft.$208$138

Sykes CreekRes - 49Att - 5
Avg. Sales Price$289,696$232,910
Sales Price per/sq.ft.$147$123

LakefrontRes - 789Att - 129
Avg. Sales Price$222,568$138,772
Sales Price per/sq.ft.$106$99

Ocean FrontRes - 33Att - 608
Avg. Sales Price$939,863$287,442
Sales Price per/sq.ft.$327$184

Newfound HarborRes - 12Att - 2
Avg. Sales Price$445,925$168,500
Sales Price per/sq.ft.$161$113

Canal - NavigableRes - 250Att - 40
Avg. Sales Price$338,717$173,502
Sales Price per/sq.ft.$165$123

Canal - DrainageRes - 150Att - 3
Avg. Sales Price$136,917$189,500
Sales Price per/sq.ft.$83$106

PondRes - 120Att - 72
Avg. Sales Price$182,283$124,752
Sales Price per/sq.ft.$102$103
Indian RiverRes - 84Att - 92
Avg. Sales Price$489,396$128,919
Sales Price per/sq.ft.$172$98

Banana RiverRes - 69Att - 110
Avg. Sales Price$442,564$153,590
Sales Price per/sq.ft.$177$112

Sykes CreekRes - 41Att - 14
Avg. Sales Price$262,102$187,878
Sales Price per/sq.ft.$140$99

LakefrontRes - 554Att - 117
Avg. Sales Price$207,705$118,066
Sales Price per/sq.ft.$98$80

Ocean FrontRes - 27Att - 539
Avg. Sales Price$679,144$243,343
Sales Price per/sq.ft.$252$150

Newfound HarborRes - 7Att - 6
Avg. Sales Price$355,628$172,233
Sales Price per/sq.ft.$132$102

Canal - NavigableRes - 240Att - 39
Avg. Sales Price$289,902$168,012
Sales Price per/sq.ft.$138$113

Canal - DrainageRes - 100Att - 3
Avg. Sales Price$122,453$65,833
Sales Price per/sq.ft.$74$69

PondRes - 39Att - 34
Avg. Sales Price$217,962$138,032
Sales Price per/sq.ft.$102$102
Source:  Melbourne Florida Area Association of Realtors (MAAR) Annual MLS Sold Statistics Report  - Waterfront

 

All MAAR Home & Condo Sales

 

2005 Prices thru July 15 2005 2004 Prices 2003 Prices 2002 Prices
Total Sales - 6152 units
2 BR 281 Avg. Sales Price $183,538
3 BR 3062 Avg. Sales Price $233,360
4 BR 1215 Avg. Sales Price $340,036
Condos 1432 Avg. Sales Price $274,008

Compared to 2004: Reflects a 43% increase in
overall sales with average sales
prices increasing by 27 %

Time on Market of Units Sold
Days #S/Fam #Condo
 
1-30 441 139
31-60 1886 477
61-90 1170 309
120+ 592 190
91-120 616 309

Residential with in-ground pool - 1179
Avg. Sales Price $380,070
Sales Price per/sq.ft. $179

Golf Course Res - 112 Att - 60
Avg. Sales Price $345,080 $211,710
Sales Price per/sq.ft. $157 $154

1 Acre + Res - 259 Att - 23
Avg. Sales Price $476,957 $491,578
Sales Price per/sq.ft. $188 $206

Total Sales - 10794 units
2 BR 556 Avg. Sales Price $123,928
3 BR 5340 Avg. Sales Price $177,624
4 BR 2164 Avg. Sales Price $283,520
Condos 2425 Avg. Sales Price $212,865

Compared to 2003: Reflects a 7 % increase in
overall sales with average sales
prices increasing by 28 %

Time on Market of Units Sold
Days #S/Fam #Condo
 
1-30 873 291
31-60 3369 893
61-90 1863 470
120+ 980 239
91-120 1249 525

Residential with in-ground pool - 2046
Avg. Sales Price $316,224
Sales Price per/sq.ft. $147

Golf Course Res - 150 Att - 111
Avg. Sales Price $280,893 $170,202
Sales Price per/sq.ft. $127 $119

1 Acre + Res - 490 Att - 52
Avg. Sales Price $378,262 $378,403
Sales Price per/sq.ft. $152 $187

Total Sales - 10046 units
2 BR 533 Avg. Sales Price $99,220
3 BR 4940 Avg. Sales Price $141,778
4 BR 1963 Avg. Sales Price $229,619
Condos 2405 Avg. Sales Price $160,301

Compared to 2002: Reflects an 18% increase in
overall sales with average sales
prices increasing by 15 %

Time on Market of Units Sold
Days #S/Fam #Condo
 
1-30 579 188
31-60 2470 781
61-90 1816 522
91-120 1056 299
120+ 1687 600

Residential with in-ground pool - 2011
Avg. Sales Price $239,111
Sales Price per/sq.ft. $115

Golf Course Res - 141 Att - 108
Avg. Sales Price $246,806 $125,026
Sales Price per/sq.ft. $107 $91

1 Acre + Res - 477 Att - 16
Avg. Sales Price $259,891 $216,012
Sales Price per/sq.ft. $113 $141

Total Sales - 8508 units
2 BR 494 Avg. Sale $78,348
3 BR 4221 Avg. Sale $124,505
4 BR 1576 Avg. Sale $205,535
Condos 2052 Avg. Sale $137,313

Versus 2001: Reflects a 10 % increase in
overall sales with average sales
prices increasing by 16 %

Time on Market of Units Sold
Days #S/Fam #Condo
1-30 554 215
31-60 2031 686
61-90 1487 421
91-120 868 249
120+ 1505 478

Residential with in-ground pool - 1787
Avg. Sales Price $214,156
Sales Price per/sq.ft. $102

Golf Course Res - 141 Att - 87
Avg. Sales Price $200,255 $110,471
Sales Price per/sq.ft. $92 $78

1 Acre + Res - 384 Att - 0
Avg. Sales Price $229,470
Sales Price per/sq.ft. $99

Source:  Melbourne Florida Area Association of Realtors (MAAR) Annual MLS Sold Statistics Report - All Areas

Coldwell Banker Ed Schlitt RealtorsRes= residential   Att=attached condos/townhomes.  Number is units sold by MAAR members.
Note: Sales may be skewed toward south and central Brevard, and new construction.

 

Contact the WEBBmaster for updated details, and help finding the perfect home or investment. Hire a professional who really knows Brevard County real estate.    321-480-5514 cel   webb@4Brevard.com

©2006 Richard Webb, Top Producer - Coldwell Banker Ed Schlitt Realtors 

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