Need to dump your property?

[destinsm]

:clap_1:

As expected... Perma bulls cheering perma bulls with no said "case" stated...

What do you have that shows a support for prices going up 200-300% over a 3-5 year period... other than pure speculation and greed by investors???

Are we running out of land like you Realtors have spouted off about the last few years... Hmmm seems to be over 3500 vacant lots for sale between Destin and Panama City Beach (just along the coast)...

Am I going to be priced out forever like you Realtors spouted off about the last few years... Hmmm, who would be your next buyer if we are all going to get priced out forever???

Are we different and special like all the Realtors have been saying for the past few years... I guess that means all of Florida, Califonia, the North East, Pheonix, Las Vegas, Pacific NW, and others have all gotten special at the exact same times... how convenient...

I am by no means saying that housing is a bad long term investment to have and in most cases is a good one... just pointing out that at this point in time it is waaaaayyyy overpriced at current price points, and we most likely have a long way to go down...

Oh by the way, it is hard to live in your 2nd, 3rd, and 4th spec properties as well... An illiquid negative cash producing alligator, sign me up for two...

 

[goofer]

"It is amazing how quickly and how deeply mass phycology has started to rule our markets..." DESTINSM


That is the way all markets work whether it be stocks, real estate, precious metals or fish !! When the mass psychology leans in one direction, it is time for you to go in the OTHER direction ala nasdaq in 2000, silver in the 80's, stocks in 1987 and tulips whenever that bubble was. Is the same thing happening in real estate ???? Maybe.

 

[destinsm]

"It is amazing how quickly and how deeply mass phycology has started to rule our markets..." DESTINSM


That is the way all markets work whether it be stocks, real estate, precious metals or fish !! When the mass psychology leans in one direction, it is time for you to go in the OTHER direction ala nasdaq in 2000, silver in the 80's, stocks in 1987 and tulips whenever that bubble was. Is the same thing happening in real estate ???? Maybe.

Tulip mania... first pat of 17th century...
[ame]http://en.wikipedia.org/wiki/Tulip_mania[/ame]

I agree that mass psychology always has played a role... but you would think we wouldn't be going through another one just as we finished up the previous 5 years ago...

I would hope the general populous be more educated than that... but maybe I am hoping to much!

 

[6thGen]

Tulip mania... first pat of 17th century...
http://en.wikipedia.org/wiki/Tulip_mania

I agree that mass psychology always has played a role... but you would think we wouldn't be going through another one just as we finished up the previous 5 years ago...

I would hope the general populous be more educated than that... but maybe I am hoping to much!

"Modern scholars (e.g. Garber) consider the event much less extraordinary than did Mackay. Indeed, the belief in the existence of a Dutch tulip mania may itself be an extraordinary popular delusion."

"...historians and particularly economists remain guilty of exaggerating the real importance and extent of the tulip mania."

"Given data about the specific payoffs present in the futures and option contracts, the authors determine that tulip bulb prices in fact hewed closely to what a rational economic model would dictate: 'tulip contract prices before, during, and after the 'tulipmania' appear to provide a remarkable illustration of market efficiency.'"

 

[TooFarTampa]

As expected... Perma bulls cheering perma bulls with no said "case" stated...

What do you have that shows a support for prices going up 200-300% over a 3-5 year period... other than pure speculation and greed by investors???

Are we running out of land like you Realtors have spouted off about the last few years... Hmmm seems to be over 3500 vacant lots for sale between Destin and Panama City Beach (just along the coast)...

Am I going to be priced out forever like you Realtors spouted off about the last few years... Hmmm, who would be your next buyer if we are all going to get priced out forever???

Are we different and special like all the Realtors have been saying for the past few years... I guess that means all of Florida, Califonia, the North East, Pheonix, Las Vegas, Pacific NW, and others have all gotten special at the exact same times... how convenient...

I am by no means saying that housing is a bad long term investment to have and in most cases is a good one... just pointing out that at this point in time it is waaaaayyyy overpriced at current price points, and we most likely have a long way to go down...

Oh by the way, it is hard to live in your 2nd, 3rd, and 4th spec properties as well... An illiquid negative cash producing alligator, sign me up for two...

I know very little about Destin or PCB or the inherent values of either area, but I can tell you that the specific 30-A market is different and special. I'm a Florida native and frankly long ago tired of the high rises and the fact that you can't see the water from the road in most places anymore. I know a lot of "locals" or natives are disgusted by all the development in SoWal in recent years, but compared to most of the other beaches along the Florida coast, even a fully developed SoWal (within the current Walton County Land Development Code) is absolute heaven. SoWal (and its beautiful white beaches, teal water and stricter development codes) is special. Add in the higher elevation and the protection from storm surge for pretty much everyone but but the first- or second-tier properties, plus an unusually good rental market for owners, and you have a place that is going to continue to be attractive long-term, RE bear market or not.

When friends of ours first bought into the area in late 2002, early 2003, it was ridiculously inexpensive by any Florida resort standards. By late 2003 values had already begun to rise significantly, but hubby and I came to visit, looked around for a day, and bought property immediately because whether or not we built or sold, retired there or just held on for a couple years, we thought it was a phenomenal opportunity. It was a great move.

I think if values have risen by 300 percent in recent years, maybe 2/3 of that is justified because the area has been maturing and the word has gotten out. The rest was similar to speculation that fueled the bubble nationwide. Probably sometime in mid-to-late 2004 in SoWal things got well out of hand. Prices have come down to earth, and may well continue to as we see how things play out locally and nationally, but I don't think there is any way that in SoWal we are going to see 2001, 2002 and probably not much 2003 pricing again except among the desperate. The area was simply undervalued back then, and now more infrastructure is there to support the pricing.

And by the way, the Northeast boom started before the California boom, which started before the Florida boom ... nothing happened in all places all at once. Even in a down cycle, all real estate is local.

 

[dsilvar]

What do you have that shows a support for prices going up 200-300% over a 3-5 year period... other than pure speculation and greed by investors???

Supply and demand!!...Do you think that because there is a paucity of buyers now and high inventory on the books, that the demand for housing is going to diminish?
Even as we speak there are positive forces at work that mitigate in favor of a healthy RE market going forward.
There is increased job growth and employment, intrest rates that are still historically low, a huge baby boomer cohort with money and young families looking for a home.
In our neck of the woods it will be the wealthy that are/will be buying and that will continue because Walton county is still underpriced compared to other cities worth living in. Price a home in London or Sarasota or West palm beach.
Destin and the surrounding areas were "discovered" and that pushed prices along with speculation. The development we will see is just starting..like it or not this area is going to boom..for all the right reasons..enjoy it while you can
Yes there will be a correction in prices but not for long..IMHO

 

[BlueMtnBeachVagrant]

.......
Take for instance Rocky who is trying to sell at $800k or rent for $1600/month... I bet if you take a cash flow look of that property ($1600/month * 120 ~ $200k) we would be right at those dreadfully low 2002 even 2000-2001 values you are speaking of...

Curious number....
120 times the month rent = property value. Do I have this right?

If so, do you think this applies to ALL properties (beach front being the same as Freeport)? In other words, when the western most property at the Retreat was recently sold for over $9,000,000, does this mean the owner would HAVE to be able to find a renter that is willing to pay $75,000 per month to substantiate it's value?

I think you might understand my point here that there IS a limited supply of "unique" properties in our area. A property located one or two blocks from the beach is not as unique and your 120 factor may be more legit. Gulf front, bay front and beach first tier properties with really good views are definitely more unique. When someone WANTS to live here full or part-time, they'll pay a premium for a unique property. To solely base property values based on rental potential may not be entirely accurate depending on the property.

Perhaps I'm looking at it too simply.

 

[destinsm]

Curious number....
120 times the month rent = property value. Do I have this right?

If so, do you think this applies to ALL properties (beach front being the same as Freeport)? In other words, when the western most property at the Retreat was recently sold for over $9,000,000, does this mean the owner would HAVE to be able to find a renter that is willing to pay $75,000 per month to substantiate it's value?

I think you might understand my point here that there IS a limited supply of "unique" properties in our area. A property located one or two blocks from the beach is not as unique and your 120 factor may be more legit. Gulf front, bay front and beach first tier properties with really good views are definitely more unique. When someone WANTS to live here full or part-time, they'll pay a premium for a unique property. To solely base property values based on rental potential may not be entirely accurate depending on the property.

Perhaps I'm looking at it too simply.

I agree with your comment 100%...

but I am not referring to these "unique" properties... look at properties in communities like Mack Bayou Estates, Driftwood Estates, Paradise Retreat, Emerald Bay, Calusa Bay, etc, etc... Nothing destinctly "unique" about these neighborhoods when you compare rentals to sales price...

General speaking (obviously size of house and location play a factor) these homes are asking rents in the neighborhood of $1500-$2200/month rent and the selling range for these homes is $350k-$600k...

I could give specific examples if interested... It is not just Destin, Santa Rosa, SoWal... it is every city in NW Fl to include Freeport, Crestview, Niceville, FWB, on and on... I am simply trying to point out that the asking price of homes in my opinion are way above their true value...

I am obvoiusly in the minority in this forum!!

 

[BlueMtnBeachVagrant]

....I think if values have risen by 300 percent in recent years, maybe 2/3 of that is justified because the area has been maturing and the word has gotten out.

TFT, I believe you're close.

Remember a 100% return doubles your money ;-)

My guess is that its more like a 150% increase (= 2.5 times orig price) over the past 4 years at the recent peak and then a pullback of around 30% off the peak price. Resulting increase is still around 75% over 4 years. I believe this is not an unreasonable appreciation rate at less than 20% per year for property such as South Walton.

Example:
$300,000 estimated value for an actual gulf front condo in 2002.
$750,000 actual resell price just before hurricane (peak valuations)
$525,000 realistic price today (my estimate); more if you ask a RE agent

 

[Smiling JOe]

As expected... Perma bulls cheering perma bulls with no said "case" stated...

In 2002, the house for which I paid $170K in SoWal was priced at $100 per square foot (including the lot). Today, find me a builder who can build at $100 per square foot, then give me a free lot, and I will take you to the bank every time. How is that for stating a case? ...and yes, that house will rent for $1700/mo, providing a 10% annual return on investment with 20% down and a 30 yr mortgage at 6%. So, bring me your listings with 2002 prices. I will sell every one of them.