$100K homes dominate the market
At the beginning of this decade, Brevard County’s real estate market was dominated by homes selling for less than $100,000.
floridatoday.com
The end of the decade is shaping up the same way.
In 2000, half of all residential properties in Brevard were sold for less than $100,000 and in 2001, the figure was 42 percent, according to a FLORIDA TODAY analysis of county property sales records.
By 2006, soaring real estate prices meant only That shrank to only 3 percent of sales that year were less than $100,000.in 2006 as the real estate prices soared, .
This year, as the economy slumped and housing prices dropped, homes in that category are on pace to account for almost 4 out of every 10 sales.
“For buyers, they are no longer priced out of the market,” said John Krause, a sales associate with National Realty of Brevard.
Much of the trend has been driven by foreclosures and short sales and sales of other “distressed” properties, which now account for about a third of homes sold here.
So far this year, 1,550 houses, condos and townhouses were bought from banks or other financial institutions. Another 845 were sold under duress.
The median price of those homes was $89,400. Those properties range from a south Melbourne single-family home bought from a bank for $5,000 to a short sale of a Lansing Island home for $1.4 million.
Krause said nearly all the buyers he is working with are looking at homes in Palm Bay built in 2005 or 2006 and that are now selling at prices up to 50 percent off their original sales.
President Barack Obama on Friday signed a bill that extends up to April 2010 an $8,000 tax credit to first-time homebuyers while adding a provision for buyers who have owned their current homes for at least five years. They could get tax credits of up to $6,500.
Falling home prices were a tremendous opportunity for Vicky Raimer and her parents.
Years ago, A few years back, the three decided to leave Brevard and move to South Carolina.
A couple of years ago, though, they decided to move back to Brevard, where her parents met and married 51 years ago. At first, Raimer and her parents rented adjoining apartments and later shared a rental house.
(2 of 2)
But falling home prices lured Raimer to a seminar for first-time homebuyers. Earlier this year, her parents bought the perfect house for the trio, one that has two bedrooms and two-and-a-half baths downstairs for her parents and separate living quarters with a private entrance upstairs for her.
“Since both of my parents are in their 70s, we all liked the idea of living together in case of emergencies,” Raimer said. “We spend time together and have dinner together but I still have my own place to go to when I’m ready.”
The Raimers paid $138,000 for the house, which had been listed months earlier for $214,000. Raimer said they wouldn’t have been able to afford the home — which was a short sale — at the higher price.
“It has been a blessing,” Raimer said. “Unfortunately for the people who had to sell, we feel for them. Nobody wants to see anybody lose their house. You really don’t. But it has worked out great for us.”
Looking
for a deal
Just about all his potential buyers are looking for lower-priced homes said, said Merritt Island real estate broker Ralph Perrone Jr. “That is pretty much all we see. And mostly it is investors who are buying.”
Investors who can pay cash are in the driver’s seat in this market, Perrone said, since they don’t have to go through the time-consuming process of getting a mortgage. In some cases, he said, deals are closed in matter of days, rather than the weeks or months needed for non-cash transactions.
Besides financing difficulties and competition from investors, people looking to purchase a home to live in for less than $100,000 have other hurdles to clear, such as low appraisal prices and the tedious — and uncertain — process of buying a short sale.
“It is the right time to buy,” Perrone said, “but it is a very difficult time to buy.”
Fewer high-
dollar homes
Financing limitations have helped slow the sale of more expensive homes. Because of the credit crunch, the only source of financing for most people are loans insured by the Federal Housing Administration. Such loans require down payments as little as 3 percent, but are limited in Brevard County to no more than $291,250.
Anybody looking to buy a more expensive home would almost certainly need a 20 percent down payment, or $60,000 on a $300,000 house. Earlier this decade, such loans were available with little or even no down payment.
So far this year, just 9.2 percent of the homes sold in the county went for $300,000 or more. In 2005, 27.2 percent did.
Those who are buying more expensive homes say they are doing so for the same reason first-time homebuyers are: Because they feel those homes are great values right now. So far, 20 homes have sold for $1 million or more this year.
“When a $3 million house goes down to $1 million, you can get a cash buyer from Canada or London,” Perrone said.
Perrone’s own parents bought a riverfront home in Cocoa last November for $1.2 million, in a deal he brokered. But Ralph Perrone Sr. points out the house was listed for $3.9 million in 2005. “The value was absolutely there. . . . I’m glad I didn’t pay $3.9 million for my house,” he said.
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