A Turning Tide
Real Estate Demands Increase Along Forgotten Coast
The calls have been steadily coming in, and it seems that interest in Forgotten Coast real estate is starting to take off once again.
Past top-heavy estimates are now bottoming out, and the number of transactions is rising, according to William J. “Jay” Rish, owner of Century 21 Gulf Coast Realty in Port St. Joe. Rish said the market is in an “overcorrection” period: Real estate prices that were once high and peaked in 2005 are now bottoming out due to the uptick of properties on the market and depressed sales.
Meanwhile, Jason Naumann of the Tallahassee-based Naumann Group Real Estate said that one of the main challenges of the Forgotten Coast market right now is financing. Over the past few months, banks have become more vigilant about financing houses along the coast, which has led to an idle market.
“The silver lining is that the pendulum has swung from one extreme to the other,” he said.
The real estate market along the Forgotten Coast has been on a steady decline since the boom of 2005. In some cases, prices have dropped about 70 percent, leaving the market at a standstill. Gordon Adkins of Weichert Realtors said that prices along the Forgotten Coast have come down so far that he has seen a 90-percent decrease in some subdivisions.
“It’s not to say that our prices can’t go down more,” Adkins said. “The cure for low prices is low prices.”
The drop in prices has encouraged a higher percentage of cash and line-of-credit purchases. According to Realtors along the Forgotten Coast, potential buyers who weren’t able to get into the market, and people buying homes for their own use who have been waiting on the sidelines, can now benefit from the dropping prices. More and more out-of-towners are buying property along the Forgotten Coast as well. However, they tend to be interested in vacation homes and rental beach/waterfront properties.
Realtors agree the natural beauty of the Forgotten Coast is unique, and the zoning has proven to be attractive to visitors. Some even venture to say that the Forgotten Coast’s quiet lifestyle is a much-needed change from the hustle and bustle of the big cities.
“In my experience, I see more people that are buying property for themselves, not buying to speculate or rent,” Adkins said.
Currently, a foreclosed house may be priced well below what it would take to build a house from start to finish. New construction and vacant lot prices also have come down to accommodate the already low market prices. Therefore, people who could not afford homes in the past have a fighting chance to not only own their dream home but to build it as well.
“Fallen prices have made homes affordable to local buyers,” said Helen Spohrer of Prudential Resort Realty on St. George Island. This means that today’s buyers are in luck. Spohrer said that because there are a large number of foreclosed homes, prices will remain low, making it a fantastic buyer’s market.
Experts also said that if sellers can afford to “sit” on the property, it would be wise to do so. Homeowners looking to sell in today’s market face pitting their prices against the prices of bank foreclosures. Agents suggest that homeowners continue making payments, if at all possible, or look into short selling.
A “short sale” is a transaction in which the homeowner is present with an opportunity to sell the property for less that what it is worth – providing the bank consents. A short sale is a more palatable alternative than foreclosure.
“It is better on everyone if a short sell can take place rather than a foreclosure,” Rish said.
Homes are now worth significantly less than what they were worth a few years ago.
“Be realistic on price,” Spohrer said. “Don’t look at what you paid, look at what it’s worth now.”
Highs and Lows in St. George Island Real Estate
Plantation Homeslow salehigh sale2006$1.75 million$2.9 million2007$1.1 million$2 million2008$1 million$2.6 million2009$900,000$1.8 million
East End Homeslow salehigh sale20060
2007$1.9 million$2.6 million2008$979,000$1.9 million2009$1.1 million$1.3 million
Gulf Beaches Homeslow salehigh sale2006$1.1 million$1.6 million2007$710,000$850,000
Source: CENTURY 21® Collins Realty, Inc.