Just In: September 2010 SoWal Real Estate Summary

[Kurt]

September 2010 SoWal Real Estate Summary

Submitted by Murray Balkcom on 10/06/10

It would be short of me to cover real estate without talking about why people want to be at the beaches in South Walton.

The cool weather blew in out of the north just in time for Fall at the beaches in South Walton.

Most vacationers have returned to work and school, leaving the most beautiful time of the year in SoWal to the locals and the occasional visitors.

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[melscuba]

Getting a "page not found" message??? Is it me or you?

 

[30ashopper]

Government incentivized sales (MAR, APR, MAY) vs. the real market (JUN, JUL, AUG, SEPT)? I don't expect the same closed sale volume early next year.

 

[Em]

30ashopper, that is a good subject to discuss. Thanks for bringing it up. Which particular incentives do you feel applied the most for Mar, Apr, May in the South Walton real estate market?

We still have gov't incentivized sales in the way of the gov't charging almost nothing to lenders. Interest rates have been and continue to be at record lows, currently less than 5% for 30 year loan. That is a huge incentive. You could also say that Homestead Exemption is a gov't incentive, and it didn't end in May. There continue to be "new buyer" loans, which require only 5% down, no payments for three months, interest rate of 5.25% with no points, no fees and no PMI. I didn't notice any slack in the gov't incentives, and they were around before March.

I agree that the gov't incentives hide the real cost of real estate, but the gov't incentives or penalties apply in almost every aspect of business today. They will likely just change over time, not go away.

 

[30ashopper]

I was thinking of the expiring federal tax credit of up to $8,000. I think that ended June. I agree low interest rates are a plus. The wonderful no money down loans that are now back concern me however, that's how we got into this mess in the first place.

 

[Em]

Remember, that tax credit has been going on since Nov 2009, not just during Mar, Apr, May 2010. Maybe your are suggesting that people procrastinate and were holding out until the end?

Also, I believe the tax credits were for primary residences only, and depending on when you bought during this period, and whether or not you were a first time home owner (owned within last three years), there were income caps.

I think our market has seen more secondary home sales than primary, so I don't think that tax credit affected local sales as much as other markets. However, the cheap interest rates do affect our local market and are as you suggested, gov't incentives.

 

[30ashopper]

Remember, that tax credit has been going on since Nov 2009, not just during Mar, Apr, May 2010. Maybe your are suggesting that people procrastinate and were holding out until the end?

Absolutely. National sales trends back this up.

Also, I believe the tax credits were for primary residences only, and depending on when you bought during this period, and whether or not you were a first time home owner (owned within last three years), there were income caps.

I don't believe the second round of credits had any restrictions aside from primary residence. The limit on jumbos was also pushed way up during this so pretty much all the property here would have been qualified.

I think our market has seen more secondary home sales than primary, so I don't think that tax credit affected local sales as much as other markets. However, the cheap interest rates do affect our local market and are as you suggested, gov't incentives.

I would love to see some stats on that. I imagine the second home market is hurting, people don't have the money. I've always wondered what the ratio is for walton. Does ECAR track that in it's database?