Welcome to FloridaGrowth.org
Where can you find information regarding Florida’s regional and local real estate trends, real estate investing, vacant land, zoning laws or other issues related to construction or development in Florida? FloridaGrowth.org. If we don’t know, hopefully we can point you to a helpful resource. Additionally, if you have an issue, question or opinion pertaining to any of the above and you would like to voice it or get some feedback, this is your forum.
FloridaGrowth.org is your portal for all Florida development issues and resources.
According to the most recent S&P/Case-Shiller Home Price Index, its looks like Florida real estate may have found a bottom.
What is the S&P/Case-Shiller Home Price Index anyway? It’s actually 23 indices. There are 20 separate city or metropolitan area indices for the U.S., two composite indices and a national index. The indices lag by 2 months. Therefore, the latest index is as of July, 2009.
How do they work? According to Standardandpoors.com “The methodology measures the movement in price of single-family homes in certain regions. This is done by collecting data on sale prices of specific single-family homes in the region…When a specific home is resold, months or years later, the new sale price is matched to the home’s first sale price…The difference in the sale pair is measured and recorded. All the sales pairs in a region are then aggregated into one index”
What do the actual values on the indices represent? The indices have a base value of 100 in January 2000. Any differences in the values going forward represent percent increase or decreases in appreciation. (i.e. if an index value changes 205 to 210 from one period to the next, that represents a 5% increase)
We looked at the latest 20 city index to see if there have been any trends for Florida’s real estate. In the 20 city index there are actually 2 indices for Florida, one for Miami and another for the Tampa metropolitan areas. So how did Florida do? Well, as of the latest report, both areas have had gains for the last 2 months. For July, Miami’s index value was 147.27 which is an increase of 1.3% over the previous month but a 21.2% drop from the same period last year. The Tampa area had an index value of 142.84 or an increase of 1.4% over the previous month. This was a drop of 18.4% from the same period last year. To put this in perspective, we’ve compiled the above chart using the last 5 years of data from this index for both areas.
Despite the real estate bubble and all the bad press, many still consider Florida to be the land of opportunity. And since it’s a buyer’s market, you might be tempted by some of the ‘good deals’ out there. But bad times have not diminished the number of those who would take advantage of trusting, naïve buyers so it’s very important to do your homework.
For instance, you can buy a piece of land sight unseen from various web sites and from eBay. At this writing there are 86 pieces of vacant land up for auction on eBay. The highest bid price (this doesn’t include the classifieds) was just around $22,000 and the lowest was a penny (these are tax liens – more in a future post). Even at $22k, this might sound like a deal especially if you are from the north-east where an acre of land sometimes goes for hundreds of thousands of dollars, even in these bad times. Are these opportunities to good to be true? Not at all. If you investigate further, you’ll find that in most cases you are getting exactly what you are paying for.
But before you buy (or bid), you’ll need to assess the other costs of developing and maintaining a property that might be thousands of miles away. Even if you don’t plan on developing the property, here are a few things you should consider:
- Are taxes current? If not, what are they and when are they due?
- Are there any liens against the property? Don’t take their word for it. Pay for a title search. You might be able to legally purchase a piece of property without doing a title search but would you want to?
- Is there a timeframe within which you must build?
- Are there utilities to the property? If not how much would it cost to have them brought in? Some parcels will never have utilities due to being part of or surrounded by protected land. If they say that you can use septic for sewage, you better confirm. If the water table is too high, you will not be allowed to use a septic tank for sewage.
If you are planning on developing the land, you’ll also need to consider the cost to build, how will you oversee the project from far away and how you’ll manage the property long-distance if you are not planning on living there year-round.
As with any profession, there are those that give their profession a good name and those that give their profession a bad name. This is obviously true with real estate agents. During the real estate boom, it seemed like everyone wanted to get into the action and unfortunately many did. There are countless stories of agents that ruined deals, artificially drove up prices and were in cahoots with mortgage brokers and appraisers. Unfortunately and for good reason, many find it hard to trust just any real estate agent or broker. The good news is that hard times have weeded out many of those that entered into the profession on a whim.
Now that some have started to wade back into the real estate market, how can they find an agent that is not only trustworthy but adept at their profession? Here are a few guidelines:
Interview the prospective agent – In all likelihood you are going to be spending a lot of time with this person. Whether or not you like their personality can be almost if not just as important as the agent’s experience. How desperate does it seem they want to get you into just any property? Will you feel pressured into seeing properties that are not within your price range? Do they seem to understand what your priorities are? Are they willing to show you properties that are not within their portfolio? How honest do they seem to be? If they mention any examples or anecdotes of when they were less than honest, chances are they will be less than honest with you just to get a deal done. Are they interested in developing a long term relationship with you? A good agent realizes that this may not be the last property you buy or sell. It’s to their advantage to build a long-term trusting relationship.
Do a little research – it’s amazing what a few clicks on the internet will reveal about an agent. Many agencies list their available properties on their web site. What types of properties does the prospective agent seem to handle? What types of properties have they sold? What seems to be their specialty? You may decide to select an agent that seems to handle the type of property you are looking for even if you are not interested in any of their current properties.
Ask your friends and family – Chances are one of your friends or family members has purchase or sold a property within the last 5 year or so. What did they think of their experience? Would they recommend their agent? Perhaps their agent would even be willing to recommend another agent that is more familiar with the area or type of property you are looking for.
These are just a few guidelines that should be considered when contemplating making a real estate transaction whether you will be buying or selling. Remember, often times your agent is your chief negotiator. Buying or selling real estate will most likely be the largest transactions of your life. For good reason then, you need to pick your agent carefully.
Here’s another way that Florida’s foreclosures might impact your property. If you have foreclosures on your block and a hurricane approaches, here’s what you should do and why:
Did you know you can buy land from the state? Florida’s Department of Environmental Protection web site has a list of available properties. These are surplus properties that the state acquired for various reasons and either never used or no longer needs. The amount of information available for each parcel seems to vary depending on where its located. Also, based on an explanation of the process from another page, it seems like the parcels might be picked over (the local government gets first dibs) However, there might be some good finds from time to time. So check it out:
This is an interested video which aired on WBCC (Brevard Community College). It gives some perspective on how Florida’s development over the past 50 years. The segment below is the first part of a series on Florida’s growth. Check it out: