I hope everyone is doing well and looking forward to a nice Summer. The buying momentum has carried over from last year and the market has seen a lot of closings. 2009 had the highest number of sales since 2005. This year we’ve almost doubled the number of sales we have had year to date. From 1/1/09- to 5/24/09 there were 80 sales. For the same time period this year, there have been 153 closings. Most new listings that are priced aggressively are getting multiple offers. Many properties are closing over asking price. The idea of closing over asking price would have seemed crazy a year ago and is no longer uncommon. I’ve had 17 closings this year and 4 of my listings have closed over asking price.
Mexico Beach/ St. Joe Beach is by far the most active market with almost twice as many sales as any other area. (All sales for this year are below) The Cape also has a lot of ready buyers; the reason for fewer sales seems to be there have been less great deals available. There was one foreclosure listed earlier this year that was a Fannie Mae foreclosure. There is a new rule with some of the Fannie Mae foreclosures that no offers can be accepted within the first 5 days the property is on the market. In the 5 days, there were ten offers. I had a buyer offer $30K over asking price, close in 7 days, no contingencies. We were told that our offer was appreciated, but we were neither the first or second place offer. In these situations where there are multiple offers, the sellers/banks are making a common counter. They are countering each buyer with “bring your highest and best offer”. It’s tough to know what to bid and most properties that get to this point are closing over asking price.
The majority of properties on the market are not priced at these low prices. For certain property types like gulf view condos, there are a lot of buyers waiting on the next deal. Not many traditional sellers are willing to sell for a 70% loss, which means buyers are usually waiting on the next foreclosure or short sale. Over half of the sales in 2010 have been a short sale or foreclosure even though only 1 out of 6 listings is a short sale or foreclosure. The big banks are pricing their foreclosures at very aggressive prices that result in quick sales. With significant competition for the best deals and the fact most listings are priced well over what comparable properties have sold for, it’s not that easy to find a great deal for every property type right now. Many buyers are getting frustrated because they wanted they wanted a place to use by Spring. I’m hearing buyers say more and more that they wish they would have bought that property they liked last year. Rather than somebody coming down and looking at 10 good deals one day and picking one, it’s taking most buyers much longer now to find a deal they are happy with. Most buyers are losing out on the first deal they go after and then they get very serious with their next opportunity. I think there are many good deals that are still to come. It does look like buyers are going to have to get used to having to compete for the very best deals and you may have to look around more than one time.
You can always make offers if you think an asking price is too high. I recently sold what is probably the nicest house in Mexico Beachfor $240,000 less than the asking price. I have sold others this year for 40%-50% of their asking prices. It’s hard not to want to make a low offer, but I don’t advise this when a property comes out listed at a great deal. I have not seen a bank move more than a few percent from their asking price in the first month a property is listed.You will more than likely lose out to another buyer, but I’m always happy to write offers and it may be worth a try. There are still lots of properties that have been on the market for years. These properties usually have the sellers that are more likely to take far below their asking prices.
Do I think it’s a good time to buy and invest in the market? Yes. Am I buying anything? Yes. I’ve personally bought or partnered with others and bought 5 properties in the last 6 months and have contracts on 2 more. I think it makes sense as an investment to buy quality lots in desirable areas that are selling for 15 to 20 cents on the dollar from 2005 prices. Condos and other residences are being purchased for 30-40 cents on the dollar and these can obviously be used and enjoyed and also offer potential rental income. Many of you plan to retire here and have decided to buy now that new houses have been purchased for less than the vacant lots sold for a few years ago. For some of you thinking of entering the market, many prices are the lowest they have been in 10 years. There have been good deals everywhere. At one time, nothing was under $800K in Windmark Beach. There was a closing this year for $45,000. There are townhouses and condos in the low $100’s that formerly sold in the $300’s which is making owning here affordable for more and more people. It may take some time, but let me know what you’re looking for and I’ll do all I can to help you make it a reality.
Two huge new area projects have recently opened. I believe these will both have a tremendous positive effect on the area. The $40 million dollar Sacred Hearth Hospital in Port St. Joeopened March 15. We now have top notch health care that people use to have to drive to Panama City to receive. The new $318 Million Dollar International Airport in Panama City opened this past weekend. This is being referred to as one of the biggest things to happen statewide with an effect that could “change everything”. A smaller project recently completed was the 250' pier extension in Mexico Beach and the new boat ramp is scheduled to be completed in early July. On another good note, I noticed yesterday that Mexico Beach recently made an AOL.com Travel list as a top 35 beach.
Of course the 800 pound gorilla in the room is the oil situation. We don’t have any signs of oil rightnow and I hope we never do. Obviously none of us know for sure exactly what’s going to happen. Is there any effect on the real estate market right now? Yes, the immediate effect has been bigger on vacation rentals. There have been some cancellations. Many others are nervous and want to make sure they can cancel if the oil does come. I have also heard of a few sales contracts cancelled. These all involved people closing this time of year and counting on the big rental income from the next 3 months. Others have postponed closings a week or two to try and get a better understanding of what’s going to happen. Most closings have continued as scheduled. Most buyers have told me they will still happily write offers and close right now if I can find them the property that meets their goals. I do have some buyers that want to wait and see what happens with this situation before purchasing. The next 3-4 months would normally have significantly more closings than any other time period of the year as more people are here vacationing and looking to buy. We were really rolling along well with inventory being reduced and more and more buyers looking to buy. I guess time will tell what long term effect the oil will have on our area and the real estate market. I don’t wish the oil upon any area, but I really hope it stays away from here.
One of the properties I sold recently was our office in Beacon Hill. We still have offices in Port St. Joe and Cape San Blas. We just opened a new office in a much better commercial location in Mexico Beach. This is the office I work out of the most and please feel free to stop by anytime at 3706 Hwy 98. We are in the office formerly occupied by Pelican Real Estate in The Villas of Mexico Beach condominium complex.
Best Deals on the Market:
MexicoBeach/ St. Joe Beach/ Windmark Beach (Mexicobeachsales.comtop 25 and top 15 lots are now being updated at least weekly. I also went back to ranking the best lot deals.The hot products seem to be cheaper lots in the 30’s to $40’s and condos under $200K. There have also been very nice high end houses purchased at great prices.
Vacant Lots: (Not shown are a few new foreclosures just listed in the $30K-$45K range, please let me know if you’re interested) http://www.rafsg.net/RAFSGReports/ListitLib/show_report.aspx?ID=1206544995
Cape San Blas:
Port. St Joe
What's Sold in 2009? 153 Closings
Mexico Beach/St. Joe Beach: 67 Sales
(The hot properties seem to be cheaper lots in the 30’s to $40’s and condos under $200K. There have also been very nice high end houses purchased at great prices.)
Cape San Blas/Indian Pass: 37 Sales
Buyers are buying whatever they can get a great deal on. Most buyers are continuing to chose the North End of the Cape.
Port St. Joe: 31 Sales
The majority of purchasers have been buying single family homes from $50-$150K with some buyers also looking for heavily discounted vacant lots.
North Gulf County: 18 Sales
Mostly lower end sales with only one closing over $100K
What's Currently Under Contract? 72 Properties
Cape San Blas: 28
Port St. Joe: 8
North Gulf County: 6
I hope some of this information is helpful. As always, please let me know if I can help with any of your real estate needs. Mexicobeachsales.com now has links to see all foreclosures and tons of other real estate information. If you’re coming down this weekend, there is a music festival in Port St. Joe on Saturdaythat should be a lot of fun. For those of you that like me that like to fish, red snapper season comes in Tuesday and fish are everywhere.
(Recent Aerial taken in Mexico Beach showing the pier extension)
Have a Great Holiday,
Broker- Port St. Joe Realty