Pappas Realty Co... "Commercial Real Estate...Exclusively" in Northeast Ohio since 1957

Saturday, December 17, 2005

I am typing this from Sarasota, FL.....

Good article on local attitudes and sentiments on the current lull in the market and with the panic in the market, i can validate some of the points made, but in also seeing the other side, whereas the builders in the article seem to feel that although a slowdown is happening, they feel the market will continue to satisfy the continual building of homes. In my neighborhood two months ago there were two condos for sale.... now there are 6. The same numbers hold true for one of my friends and his home. He had one home for sale four months ago and now there are 7 in his community. I get the feeling that most home owners and residents are simply trying to get the money out of their home, as the appreciation has been a bit ridiculous... almost anywhere between 5% up to 300% in some cases and more I am sure if there are certain attributes such as waterfront, golf courses, etc.
Ultimately, I feel the market has been flooded with sellers and now presents a buyers market, in that, some investors who may have gotten aggressive financing, may be willing to sell at a loss just to unload what they thought would be a quick flip as to avoid the mounting mortgage, condo, real estate, utlitity costs that are due monthly.

I have another premonition that the market will stabilize, but the appreciation that has been so newsworthy, will be tempered but above average for the forseeable future. A plethora of problems and concerns exist for a market like this, such as forclosures, folks who live in the area, but cannot continue to afford living in the area as property taxes skyrocket, etc. Eventually the rental market which has all but dried up due to condo conversions, ability to purchase versus rent, will come back into popularity or necessity is a better word, as folks who were trying to purchase but became overwhelmed, will then look to rent. Now the other side of the sword is, as a landlord can you overpay and rent your investment out for enough money to cover the mortgage and the expenses that also come along with ownership. In most cases it will be tough to succeed, unless you buy right, or have the ability to cover some minor expenses each month but cover the mortgage.

Anyhow, thats my wrap up report for the past week. I hope everyone had a great weekend no matter what the weather was like wherever you might be reading this.

Stay warm and the best to you and yours this holiday season.



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