US Consumer Confidence Recovers In March

Yesterday, a survey was released by the Conference Board in regards to the Consumer Confidence Index.

According to the Conference Board, a business research firm, the consumer confidence index rose to 52.5 points in March, from a revised figure of 46.4 in February reversing some of the deep pessimism felt last month. The February 46.4 marked the lowest level since April 2009 and erased three consecutive months of improvement so all eyes were on this current survey due out yesterday. Analysts were expecting a number of about 50 so the 52.5 was very encouraging! That recovered at least half of what was lost in February.

The monthly poll asks 5,000 US households a series of questions about their level of confidence in the economy. The results produce an index were 100 points would signify absolute confidence, while zero represents absolute pessimism.

The confidence report came out the same day as a key home price index (up nearly 4 percent from its bottom in May 2009, but still almost 30 percent below its May 2006 peak). Housing along with Job Market challenges are the primary factors in slowing down a rebound. The Labor Department with report on Friday, but economists are expecting unemployment to remain steady at 9.7%. Florida's unemployment rate remains 6th in the country at 12.2%! That is why we are also watching the impact on job growth by the Rapid Rail project... about to ramp up its construction for a Tampa to Orlando Fast Train.

Advance Notice Of New Listing At Redington Shores Yacht & Tennis Club!

Redington Shores Yacht & Tennis Club continues to shine as a favored destination along the barrier islands of Tampa Bay. Redington Shores is located mid-way between Clearwater Beach at the north end and St Pete Beach at the southern end of this 23 mile stretch of pristine white sandy beach and beautiful azure sea.

The Yacht Club sits on 25 acres combining custom built homes with waterfront condominium residences ranging is size from 2000 to 4000 square foot penthouse villas! With Boca Ciega Bay flanking it north side by the condos, the intercoastal heading north and south on the east side and the Gulf of Mexico directly across the street to its west, owners and guests at the condos find water views in all directions!

Each of the 4 residential condo buildings are individually named: Las Palmas, Las Flores, Las Brisas and La Bahia. By the end of this week, we will be listing a 5th floor condo in Las Flores for sale. The "standard" floorplan of 3 bedrooms/3 baths is where "standard" ends! Upgrades are many and include Cherry wood cabinetry with crown molding, tumbled marble back splash, built-in dry bar with wine chiller, high level granite counters and designer lighting over center island.

30 feet of waterfront balcony encourage outdoor living that our Florida lifestyle enjoys. Full laundry room is a pleasure, but the master bath is truly a dream... from the step-up garden tub to the oversize walk-in shower, everything is customized to make your daily life a treat. PLUS, the condo is fully furnished with everything you need down to the matching dinnerware. Simply bring your toothbrush and enjoy!

And when you're ready to step out, head over to the clubhouse or play a set of tennis... then head over to the beach for a sunset stoll... now that is the life!

All Eyes On Fed-Back Program Ending March 31st

We have been keeping a close watch on mortgage rates with the March 31st deadline approaching. Rates have been kept down by the Fed’s $1.25 trillion program to buy up mortgage-backed securities issued by both Freddie Mac and Fannie Mae. That program is scheduled to end March 31st - this coming Wednesday. Rates on a 30-year mortgage had fallen to a low of 4.71 last December and has remained around 5% since then.

This week, mortgage rates on a 30-year fixed moved slightly higher to 4.99 but remained just below 5 percent. Many are concerned that mortgage rates could rise once the program ends, weakening the fragile recovery in housing and the overall economy. Once the Fed-based funding ends, these mortgage bond giants will be dependant on private funding. The looming question is whether private investors will demand a higher rate of return for their still somewhat risky mortgage bond investment. If that becomes the case, mortgage rates could climb quickly.

In addition this week, the average rate on a 15-year fixed-rate mortgage was 4.34 percent, up a bit from 4.33 percent last week, according to Freddie Mac.

Rates on five-year, adjustable-rate mortgages averaged 4.14 percent, up from 4.09 percent a week earlier.

Rates on one-year, adjustable-rate mortgages rose to 4.20 percent from 4.12 percent.

Spotlight On Seamark In St Pete Beach!

Each of the beach communities along the barrier islands of Tampa Bay is unique and St Pete Beach is no exception. Famous for its resorts like Tradewinds, Sirata and Alden, St Pete Beach is a beach wedding magnet and on any given weekends there are an abundant number of excited brides and grooms taking full advantage of this lovely stretch of beach and the amazing photo opportunities at sunset! People whose families have been coming to this area for decades are very familiar with Seamark, a residential gulf front complex that is nestled between Tradewinds and Sirata.

Built in 1973, Seamark features 1 and 2 bedroom condos on 11 floors. On the beach side of the building, there are two gulf front 2-bedroom corner residences per floor. The views from these units are stunning and feature TWO balconies to take full advantage! The PURTEE Team recently sold Unit #902 and currently has Unit #602 listed. This week, Unit #802 was just listed at $725,000. Information can be found in our Featured Listings. In this unit, a great deal of thought and upgrades sought to make this slice of paradise unique. Gone is the shotgun feel of enclosed walls! Kitchen area has been opened and expanded with full upgraded finishes. Walls to both bedrooms have been replaced with glass... yes, even glass doors! Since both bedrooms have stunning beach views, as well as the living room, one walks in and is simply WOWed by the full 90 degree view! And yet, a simple shutter system makes privacy quick and easy.

Ready to find your own place at the beach? Seamark is definitely worth considering!

Spring Break - Beach Magnet!

Nothing draws spring breakers like the allure of warm weather, sandy beaches, bikinis, volley ball and a general sense of "good times". This picture was taken yesterday on the beach in Treasure Island, one of the barrier island communities along the shores of Tampa Bay.

Treasure Island with its buccaneer past is a "treasure" of a location for beach-goers. It's beautiful beaches include the extra wide beach near the Bilmar and Sloppy Joe's... the central location for concerts, Sunday evening jam sessions and magnificent firework displays... all the way to the pristine neighborhood of Sunset Beach at the southern end of Treasure Island.

The draw on this day was in Sunset Beach at a local beach bar & restaurant called Caddy's On The Beach . With its casual atmosphere, 7 days a week live music, grouper sandwich and awesome barbeque, as well as volleyball games and anchorage area for visiting boats, Caddy's has become a favorite place to spend a beach day!

Living in the area, we frequent the restaurant in the quiet times as well, so it is amazing to see it come alive during Spring Break to share with friends from all over the world...

What Will It Take To Recapture That Buyer Sense Of Urgency?

It has truly been an eye-opener to observe the difference in Buyer behavior over the last 7 years. One of our gulf front listings back in 2003 was listed at $995,000 and we were very aware of that $1 million threshold that had not been broken. It sold to the the condo owner next door for $950,000. Since this upscale complex offered two condos per floor, the new owner was able to merge the two into one dramatic penthouse residence.

Once the $1 million threshold was broken, things really began to heat up. Buyers were able to get financing on a "drive by" appraisal, or with "stated income", or the ever so attractive "interest only". Interest only was a seemingly great choice because appreciation was occurring at an unprecedented 19-21%/year! "Flipping" a unit (or reselling it for a higher price due to an original low entry price combined with appreciation) became an obsession to many ready to earn a quick profit. There was a point in 2006 where you could not get a property on water here in Tampa Bay for under $700,000! And buyers were flocking in, competing offers for prime properties, and bidding wars. Over 1000 people were moving to Florida a day!

Then a series of things happened... the hurricanes of 2004 wreaked havoc in Florida as 5 named storms made landfall, 3 of which with sustained winds of 115mph. Charley, Jeanne, Frances and Ivan became names not to be forgotten. When Katrina hit New Orleans in 2005, bringing national concern and attention to the issue, Florida found insurance premiums drastically increasing and some insurance companies pulling out altogether.

Simultaneous to this boost in insurance, the tax man was also on the way. Home values soared and along with it property taxes. So owners got a double dose of increased carrying costs which made owning these properties MUCH less affordable. If that wasn't enough, interest rates began to rise. This was the point when things began to go downhill. Buying a $700,000 condo carried with it a much higher cost and had lost its star appeal.

As property values plummeted, the Buyers had become cautious. No one knew where the "bottom" was and the concern was buying too high. We saw potential buyers begin to rent the properties that they might normally have purchased... as the rent was less that what it would cost to own. Sellers now found themselves competing for the few Buyers ready to take advantage of this time. And the Buyer's market brought out the merciless tactics of driving hard bargains and leaving Sellers unable to even cover their mortgages. Thus, short sales, foreclosures or in many cases the Seller bringing the shortfall $$ to the table.
But things are beginning to shift again. Insurance premiums have come back down, property taxes have lowered with the decrease in property value, and interest rates are at significantly lower numbers. What sparks that sense of urgency? The picture left is a project called Signature Place in downtown St Petersburg that took a beating in value as it was completed in 2008. An auction took place March 7th with 41 units being offerred at a fraction of their original prices. Attendance was great! Every unit sold above the minimum bid price, ranging from $174,000 for an 859 sq ft unit to $742,000 for a 2,319 sq ft unit. At least 10 additional units were sold and there are plans to bring more units onto the market shortly.

An announcement came out late Monday about a Builder Closeout for 20 waterfront units in Treasure Island ranging from $129,900 to $239,900. They will begin taking contracts on these units this Saturday at 9am. Speaking with the agent, they already have commitments from 40 Buyers interested in making an offer and 60 others planning to attend Saturday to take a look! To take advantage of this kind of opportunity, Buyers will be forced to make a decision and "pull the trigger" quickly. These are the kind of deals that spurred Buyers on in 2004 and 2005. It should be interesting to see how this unfolds.

Anyone interested in participating in this Treasure Island opportunity should contact us as soon as possible at 727-480-8219.

Financial Implications Of The Current Recession

An article came out last Friday written by Dave Carpenter and Jeannine Aversa, business writers for the Associated Press entitled, "Slowly, Americans are Regaining Their Lost Wealth ".

On the surface, this seems like a ray of hope moving beyond this economic downturn... the worst since the Great Depression of the 1930's. It is fairly inconceivable that American Household net worth that had soared to a pre-recession peak of $65.9 trillion had fallen to its low of $48.5 trillion in the first quarter of 2009. "Net worth is the value of assets such as homes, checking accounts and investments minus debts like mortgages and credit cards." That is a 26.4% drop or over a quarter of each American family's net worth over that 2 year period! To recoup to pre-recession times, the net worth would have to climb over 21% from its latest 2009 4th quarter level of $54.2 trillion.

We have seen rebounds from previous recessions spurred on by consumer confidence and therefore more spending. Americans, in general, have had the wind knocked out of their sails during the last 2 years and are naturally cautious. However, what makes us strong as a nation is that we are a land of hope, entrepreneurism and determination to make things better. That is what will pull us out of this slump and lead us forward into a new period of prosperity.

It is a little like watching the impact of this long stretch of cold weather we have experienced the last 2 months on our beautiful palm trees here in Tampa Bay. They looked so brown and bleak from the cold. Now that our beautiful weather has returned, there are new bright green sprouts reflecting the new life and beauty just around the corner.

12 Days & Counting To The Honda Grand Prix Of St Petersburg

Springtime is here and that means welcoming a host of activities in the Tampa Bay area! Right around the corner is the annual HONDA GRAND PRIX OF ST PETERSBURG. Racing along the downtown waterfront city of St Petersburg, Florida has been a traditions since 1985. Beginning in 2006, the race became an IndyCar Series and the first non-oval track for the Indy Racing League. The race includes 100 laps of the 1.8 mile track and to date the lap record is 1:00:98 by Sébastien Bourdais, Newman-Haas Racing in 2003.

For 3 days from March 26-28, 2010, downtown St Petersburg will come alive with this "grand" event! And to get things off to a great start... on Thursday night, March 25th, the 2010 Illuminated Night Parade & Fireworks will begin at 7pm. "Grand Marshall Ryan Briscoe, together with the other race drivers, will wind through downtown and along the beautiful waterfront to celebrate the official start of the Honda Grand Prix. The Illuminated Night Parade has been a favorite among audiences of all ages since 1969 with fabulous floats lighting up the night sky, music and beads!"

Just one more reminder about all there is to do and enjoy every day in Tampa Bay!

February Statistics Are In - Where Are We Headed?

The February Market Statistics have just been posted for Pinellas County and we have added them to our website. Personally, I always go first to the Absorption Rate (or Inventory Turnover) to catch a trend. The Absorption Rate is determined by dividing the number of units sold during the month by the number of active listings in the Multiple Listing Service.

Click On The Chart For A Clear View:
The absorption percentages increasing reflects the market absorbing the inventory that is available. This is definitely a result of the median price. In Single Family Homes, the highest price level occurred in October of 2005 at $276,000. In February 2010, the median price of homes sold was $130,000.

Condos reached their high level as well in October of 2005 at $215,000. In February. the median price was $110,000.

The inventory has had to experience this decrease in value to stimulate the market back into activity. This is the point investors, and buyers in general, start to look hard at which depreciated properties have the best chance to appreciate on the upturn.

Can The Boomers Lead Us Out Of The Slump?

If it truly is a numbers game, more than 78 million baby boomers... born between 1946 to 1964... will reach age 55 over the next 10 years. This group has taken a beating with declines in their home values, IRA's and other retirement plans. The dreams of early retirement and decades of carefree living may seem further off right now, but I have personally seen this group of people re-write the book on how things are done.

Last October, we featured an article about the aging population: http://floridagulfpropertypurteeteam.blogspot.com/2009/10/social-economic-implications-of-aging.html This is an innovative group with massive influence with their actions. They are not inclined to stay down. This hard-working group may have just the answer to analyzing what caused this economic downturn and how to propel it forward. Even though none of us has been immune to the implications of the last couple of years, I personally am so grateful we are already in the Tampa Bay area. As others discover its tremendous appeal, we as realtors are doing all we can to help ensure they get the same benefits of living in the area as we have.

Warren Buffet's Latest Real Estate Forecast

Warren Buffet, a well respected billionaire and head of Berkshire Hathaway investment group, has gotten a great deal of press from his Annual Letter To The Shareholders. From Bloomberg to USA Today to Reuters UK, his commentary has our attention.

He has basically said the problems in the US property market will be over within a year. Although prices will remain ‘far below bubble levels’ for the medium term, he predicted the house inventory declining should have the market rebounding by 2011. The quote that sums it all is “People thought it was good news a few years back when housing starts - the supply side of the picture - were running about two million annually. But household formations - the demand side - only amounted to about 1.2 million. After a few years of such imbalances, the country unsurprisingly ended up with far too many houses.”

Andrew Frye with Bloomberg cites that this has been "the worst housing decline since the Great Depression and has left one in five U.S. mortgage holders owing more than their houses are worth. Record foreclosures last year flooded a real estate market already glutted with unsold property, causing new construction to fall to the lowest in at least 50 years. The fall in homebuilding is the only fix unless the U.S. decides to 'blow up a lot of houses,' Buffett joked."

We are seeing inventory levels shrinking here is Tampa Bay and Buffet's prediction go right along with the advice we are giving our clients... the time to buy is now. Don't hesitate to call on us!