December marked the fourth month in a row in which home sales improved in the Tampa Bay area.
The long-awaited rebirth of the housing market? More like buyers feasting on a glut of foreclosure homes.
Cheaply priced properties, many of them bank-owned, constitute a disproportionate number of local sales. From December 2007 to December 2008, closings rose 16 percent, from 1,597 to 1,857, according to the Florida Association of Realtors. Median sales prices headed in the opposite direction. Year over year they plunged 27 percent, from $199,800 to $145,700.
The December sales picture across Florida was similar: Sales up 27 percent, prices down 27 percent. Buyer activity increased last month in 16 of 20 Florida housing markets. Gainesville, Tallahassee, Pensacola and Punta Gorda were the exceptions.
Tampa real estate broker Jim Knetsch of RE/MAX ACR Elite Group said foreclosures make up close to half of sales in some areas. Most of the purchasers are bargain-hunting investors with ready cash.
He expects a further wave of foreclosures to hit the market as banks find agents to list homes they've already repossessed. Until more homesteaders appear to suck up the surplus, Knetsch expects home prices to remain strained.
"It's just a race to the bottom right now," Knetsch said. "Where the bottom is, I don't know."
Florida Realtors also wrapped up their sales report for the whole of 2008. In the Tampa Bay area, 23,615 homes sold last year at a median price of $169,580. In 2007, 24,310 homes sold at a median price of $208,900.
Local home prices have crashed 39 percent since topping out at $239,600 in June 2006. It's not just foreclosures driving the decline. Buyers also are purchasing smaller homes. That skews statistics to make it look as if individual homes have lost more value than they really have.
Lawrence Yun, chief economist with the National Association of Realtors, is asking the government to inject more into a housing stimulus, including a nonrefundable tax credit, to buff up what he fears could be a lackluster spring buying season.
Mortgage rates for borrowers with good credit hover just over 5 percent. That's rock bottom by historical standards. But lenders generally are demanding higher down payments. As unemployment crosses 8 percent in Florida, fewer buyers have that sort of cash on hand.
"The market is still far from normal balanced conditions," he said. "Buyers will continue to have an edge over sellers for the foreseeable future