REAL ESTATE NEWS, COMMENTARY & OPINION
Single-family home sales on Amelia Island during the second quarter of 2007 (April 1, 2007 through June 30, 2007) indicate many sellers have to wait longer to sell a home and they are getting a bit less for their homes this year compared to the same quarter last year. With an abundance of inventory on the market, some sellers who need to move are cutting prices. New home builders in the Amelia Island area have been offering home buyers big incentives including slashing home prices, paying for closing costs and other upgrades, to attract buyers to spec homes already built.
Data from the Amelia Island/Nassau County, Florida MLS for the second quarter of 2007 indicates that 72 single family homes were sold by Realtors® on Amelia Island (MLS areas 1-6), at a median price of $406,500, and average days on the market 128. Time on the market is about one month longer this year than the second quarter last year. Also, home sale prices have declined about 6.5% from the median sales price last year, which was $435,000 during the 2Q06. The number of sales transactions for the second quarter this year indicates about an 11 percent decrease in sales transactions on Amelia Island in the single-family home category compared to the second quarter last year in 2006, when 81 single-family homes sold on Amelia Island. This 11% dip in single-family home sales activity is actually much better than the Florida statewide average (across Florida, existing single-family home sales transactions were down 30% during the 2Q07 when combining all MSAs (metropolitan statistical areas). The median price of a single-family home in Florida dipped 4% during the second quarter of 2007, compared to a year ago (see more about Florida statewide home sales data at end of article).
It’s notable when looking at Amelia Island MLS (Multiple Listing Service) activity reports these days, that there are many more listings “expiring” without a sale, and/or being “withdrawn” from the MLS, compared to recent years. As of August 28, 2007, there were 360 single-family homes for sale on Amelia Island. Looking at monthly sales activity for the island (single-family homes), during the month of July 2007, 31 single-family homes sold. Thus, at the recent monthly closed sales transaction pace, it would take around 11 months to absorb the current supply of single-family homes located on the island. The supply/demand situation remains unbalanced, and it’s obviously a much better time to be a buyer than a seller. Note that some would-be buyers desiring to purchase a home in the Amelia Island area and in Florida, are sidelined because they haven't been able to sell a property elsewhere to be able to buy here.
Market psychology has also come into play, with so much negative media on the housing outlook in the national news and mainstream media, creating an atmosphere of high anxiety. The real estate market is similar to the stock market in this respect, with fear and uncertainty itself able to impact the direction of the market at times. (Just like positive reports of fortunes being made -- stories of people buying pre-construction and flipping in the boom years, making great profits, enticed many to jump on the bandwagon as prices were on the upswing at a record pace.)
Looking across several categories of dwellings, this past spring 2007 (as of March 12, 2007), there were 739 “active” properties listed for sale on Amelia Island in zones 1-6 in the Amelia Island/Nassau County MLS (dwellings in the residential categories of single-family, condo, town home and duplex). Recent data from the Amelia Island/Nassau County MLS indicates as of September 3, 2007, 765 dwellings listed for sale on Amelia Island by Realtors® in these same categories. Thus, during the past six months, supply has increased slightly.
Of course, real estate is a cyclical industry, so the transition from a sizzling real estate market in 2004 and 2005 to a slowdown in real estate activity was inevitable -- the record high sales pace of the “hot” market could not sustain itself forever. However, some think the fall out from the meltdown in the credit/mortgage industry has added additional uncertainty for a housing recovery anytime soon. Whether the Fed will step in and begin a series of cuts to the Fed Funds rate (which effects the prime rate and some mortgage rates) to offer some relief, remains to be seen (next Fed meeting is September 18, 2007).High-end Amelia Island Homes Sales Activity Remains Steady
Note that the real estate market slow down has not hit the high-end homes here on Amelia Island like the below-million segment of the market. When looking at the high end of the Amelia Island market – including homes, condos, town homes selling above a million dollars -- sales activity has not declined. The number of sales above one million dollars on Amelia Island, sold by Realtors® and listed in the Amelia Island/Nassau County, Florida MLS during the first half of 2005 (a great year for real estate) were 22 sales of million dollar-plus dwellings, a mirror image of 22 sales of such properties in the first half of 2006. This year, there’s actually a slight increase in sales transactions at the high end of the market -- twenty-five $1,000,000-plus sales on Amelia Island during this year’s first half (January 1, 2007 to June 30, 2007). Interestingly, this year in the first half of 2007, those 25 sales of million dollar-plus properties sold more quickly -- days on the market was 177. It actually took a bit longer to sell high-end property in the previous two years when days on the market were recorded at 207 days in the first half of 2005, and 206 days in the first half of 2006.
Jacksonville Beach Communities Real EstateIt appears the Amelia Island single-family home market activity level may be fairing a bit better than some of the nearby Jacksonville beach communities. According to an August 24, 2007 article in the Jacksonville Business Journal, during the second quarter of 2007, “overall home sales activity is down 21 percent in the beaches communities near Jacksonville,” (Neptune Beach, Atlantic Beach, Jacksonville Beach, and posh Ponte Vedra Beach), compared the same quarter in 2006 (the Biz Journal’s articled was using data from the Northeast Florida Association of Realtors®). As noted above, sales transaction activity of single-family homes on Amelia Island dipped 11% from 2Q06 to 2Q07. The Jacksonville Biz Journal also reported that million-plus homes in the North Corona area of Ponte Vedra have been consistent, with similar sales activity year-to-year during the second quarter, and a $300,000 increase in the average sales price.
Florida statewide Single-Family Home Sales
Looking at the Florida single-family home real estate market for the second quarter of 2007, according to the Florida Association of Realtors© (FAR), “In second quarter 2007, Florida's housing sector in many markets continued to report higher inventory levels of homes for sale, median prices edging down and sales activity reflecting a buyer’s market."
Statewide, sales of single-family existing homes in Florida totaled 37,709 during the three-month period, a decrease of 30 percent compared to 53,723 homes sold during the same time a year earlier, according to the Florida Association of Realtors® (FAR).
The Florida statewide existing-home median sales price was $239,200 in the second quarter of 2007; a year ago, it was $250,400 for a decrease of 4 percent. In 2002, the second-quarter Florida statewide median sales price was $137,400, which reflects an increase of about 74.1 percent over the five-year period.” FAR released this data in an August 27, 2007 press release.
__________Note: MLS data may contain errors and is not guaranteed. The data above for both Amelia Island inventory supply and the number of sales exclude some properties located on the Amelia Island Plantation that are listed in-house with the Plantation’s real estate division, and also excludes privately recorded sales (For Sale By Owner properties), that are not listed/recorded in the Amelia Island/Nassau County MLS.)