To Clearwater investor Jack Shea, a surge in Tampa Bay area home sales in February represented less a housing recovery than a "bottom picking of low-hanging fruit.''
But after three years of housing drought, the fruit basket looked uncharacteristically bountiful. Local sales rose 23 percent in February, the largest year-to-year jump since September 2005.
Of the 1,856 home sales recorded by local Realtors last month, close to half the properties were in or heading toward foreclosure. The median sales price in February stood at $131,400, a yearly decline of 27 percent.
"Investors that I know are buying selectively," Shea said. "In places like Pinellas Park, a house that didn't make sense to buy at $150,000 makes sense at $80,000."
The Florida housing market outperformed the national market. The number of sales nationally dipped close to 5 percent year over year as the recession crimped purchases in former boom states like North Carolina.
It's not just investors propping up local real estate. First-time home buyers, motivated in part by 5 percent mortgage rates and an $8,000 federal tax credit, made a relatively strong appearance.
"Fifty percent of what is happening out there is first-time home buyers," said Nikki Ubaldini, who runs a branch of Keller Williams Realty in Palm Harbor. "We're seeing relocation inquiries daily."
Few are calling a market bottom. While the 1,856 sales in February hit a recent high mark, they still pale next to the 3,771 homes that closed during February in the peak year of 2005.
Nor did the strength extend to condo purchases, which rose 1 percent from February 2008 to February 2009. Bargain hunters drove median condo prices in Pinellas, Hillsborough, Pasco and Hernando counties down to $98,800. It's the first time in years overall condo prices dropped below $100,000.
But revived investor interest, combined with a renewal of house hunting among younger families, points a way out of the thicket. Tampa home investor Vince Pizzitola said buying rental homes makes sense considering how poorly most other investments are faring.
"What are you getting from the bank account? One percent? One-half of a percent?" Pizzitola said. "You buy a $100,000 house and can get $1,000 rent for 12 months. That's a 12 percent return. That's a nice investment these days.''
Prices will struggle to stabilize until the market works off its glut of unsold homes. So far it has been slow going. Pinellas Realtors said home listings stood at 14,574 in February, down from a peak of 18,504 two years ago. Hillsborough listings are down to 17,400 after cresting at 21,000.
For the rest of the year, the market could be tugged in opposite directions, the negative pull of the recession laboring against the positive pull of the economic stimulus plan.
"Improvement from the economic stimulus isn't likely to show as closed home sales before summer, although we may see an earlier lift from lower mortgage interest rates," said Lawrence Yun, chief economist with the National Association of Realtors.
The Tampa Bay area housing market performed slightly better than Florida's. Overall Florida sales climbed 20 percent in February. In Cape Coral-Fort Myers, where typical homes sell for about $97,000, sales almost doubled last month.
Northern Florida markets like Gainesville, Tallahassee and Pensacola showed large sales declines year over year. Home prices in all three of those metro areas are higher than they are in the Tampa Bay area.
James Thorner can be reached at [email protected] or (813) 226-3313.