Tampa Palms, Westchase, Carrollwood and Tampa Bay Real Estate News From Jeanne Prigitano

The Tampa Bay Area Housing Market showed some definite improvement in 2011. December 2011 sales showed an increase of more than 12.5% over November 2011. Although sales were down by 7.5 % in December 2011 over December 2010, overall 2011 sales increased 11.5 % over 2010. That is a significant improvement, especially considering that there were fewer homes for sale in 2011. The year ended with 5.3 months inventory. Six months inventory is considered a balanced market. Anything over 6 months is considered a Buyer’s market and anything less than 6 months is considered a Seller’s market. I don’t believe we are in Seller’s market, just yet, but we are definitely trending towards a more balanced market. More on that, later. The average sales price in December 2011 increased 7% from November 2011 and was actually 3% higher than December 2010. Nevertheless, average sales price for 2011 was approximately 5% less than in 2010 largely due to very low prices in the first quarter of 2011.

So, where are we headed in 2012? I had predicted that 2011 would be the year we would begin to see some stabilization in the housing market. After a rough first quarter, I believe that things did stabilize. I don’t think that we will see any major price declines in 2012 and in some areas prices have already stopped declining. Clear Capital, a housing valuation company, is predicting a 7.4% home price increase in 2012 for the Tampa Bay area making it the 6^th in the nation in predicted price improvement.

Based on my own experiences in 2011, this is what I think the market will look like in 2012. Forty percent of my 2011 sales were to investors with investor sales heavily skewed to the first half of the year. Of my remaining non-investor sales, a whopping 85% were to first time home buyers. Only 25% of my sales were bank-owned foreclosures all in the first quarter. Even investors were conventional sales. Twenty-eight percent of conventional sales were in new construction.

As 2011 progressed, there were fewer foreclosures. I believe that trend will continue. I still see the first-time homebuyer being a strong market. Out of the 3 buyers I am actively working with now, 2 are first time homebuyers and one is under contract on new construction. Housing is more affordable for the first time homebuyer, interest rates are low, and they don’t have a house to sell. My other buyer is a retiree who is relocating. Baby boomers still see Florida as the place to be. The lifestyle is great and it is more affordable than other parts of the country. It will continue to be a buyer’s market trending towards a more balanced market (neither a buyer nor seller’s market). I think the inventories are low because many people, who would have sold, have decided to stay in their homes or rent. They can afford the mortgage even if they are underwater and have decided to just stay put. Interest rates will probably stay low but will not stimulate as many sales as hoped. Interest rates could be zero but buyers still need to have good credit scores and some down payment. What we really need is jobs. It will also be interesting to see what affect this election year will have on the 2012 housing market. Stay tuned.