As the economy sputters along and unemployment rates remain steady at more than nine percent, there isn’t call for celebration. Whereas the real estate market was also lumped in with these aforementioned Great Recession causalities, in certain regions sales of homes and condominiums are showing positive signs giving hope to an industry that has been treading water for over three years.
“The (Miami) market has done a complete 180 [degrees] from twenty-four to eighteen months ago,” says Darin Tansey, vice president for Barclay’s Real Estate Group. “People were looking for deals and steals but now they are buyers looking at more substantial properties,” he continued. “Last year, there were only twelve closings on the water, and we have already had fifteen closings this year and we haven’t entered the fourth quarter yet.”
In September, the National Association of Realtors (NAR) released its monthly report and the news was encouraging. From August 2010 to August 2011, sales of existing single-family, townhomes, condominiums and co-ops spiked by18.6 percent. The report also found that sales on a monthly basis increased by 7.7 percent with unsold inventory dropping by three percent.
While these are aggregated national statistics show promise, these real estate tea leaves should be read with caution. “Some of the improvement in August may result from sales that were delayed in preceding months, but favorable affordability conditions and rising rents are underlying motivations,” noted Lawrence Yun, NAR’s chief economist. “Investors were more active in absorbing foreclosed properties. In additional to bargain hunting, some investors are in the market to hedge against higher inflation.”
The Miami Herald’s “Economic Time Machine” finds that Florida’s real estate industry isn’t having a banner year but improvements are clear to see. For example, the Sunshine State finished fourth in earnings from real estate in the second quarter with a 1.2 percent gain from the start of 2011. Texas, Oklahoma and New York were the only states that ranked higher with real estate earnings up between 1.5 percent and two percent.