Remembering that real estate was the first “industry” to feel the impact of a weakening economy, it stands to reason that it may lead way to recovery.
Real estate sales transactions have been increasing around most of the rest of the state for the past year or so. The Emerald Coast, or Northwest Florida in general is typically believed to trail the rest of the state by from 12 to 18 months, depending upon whom you ask.
So, sales transactions are finally increasing here as well. Not as compared with last year, but as compared with recent months. This 2009 positive trend is the result of a number of things:
1. Interest rates are incredibly low.
2. Sales and asking prices are incredibly low.
3. Inventory levels are high – Choices are plentiful.
4. $8,000 tax credit for first time buyers.
5. An overall sense that prices will not decline much further.
Moreover, we have never seen low mortgage interest rates and low housing prices at the same time. This is an unprecedented opportunity for buyers. This helps to explain why we are seeing so many institutional buyers and investors coming back into the market. We are being approached by REITs and others, searching for investment properties, both residential and commercial.
You cannot turn a battleship on a dime, and neither will this economy rebound in an instant. What we are seeing now are the early signs of a real estate recovery. Some prices may very well go lower before they go higher, but as sales transaction numbers continue to improve, the brighter becomes the light at the end of the tunnel.