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Falling home values bring buyers' market in Hernando County

There was a flurry of activity around Brooksville Realtor Gary Schraut's home office Friday as he juggled another busy day of contracts to write and offers to make.

Fueled by sinking home values — in some cases to rock bottom — plenty of buyers who sat out the first months of the free fall are now starting to think that the bottom might be near.

Just Friday morning, Schraut had looked at a new Hernando County property listing: $59,900 with three bedrooms and two baths. He said the value of the nice house seemed unreal. Not long ago, it could have gone for twice the asking price.

"I don't know where you go from here unless the bank gives you the house and writes you a check,'' he said.

From 2009 to 2010, when figured by ZIP code, every single area of Hernando County saw double-digit drops in single-family home values. Values in much of Spring Hill plummeted by 18 percent. The appraisals are based on home sales in 2008 versus 2009.

Overall, the value of property in Hernando County for that period dropped between 11 percent and 12 percent, with tangible personal property tax rising to offset the deeper losses in home values while values in commercial and vacant properties fell in various places along the spectrum.

Hernando County Property Appraiser Alvin Mazourek thinks it's unlikely the trend will change soon.

The type of housing has had a lot to do with where the rate of decline has been the greatest, Mazourek said. The largest decreases have been in places like Hernando Beach, where people have been buying and selling second homes. In some areas of Spring Hill "you had a combination of your lower-priced houses and people basically looking for deals,'' he said.

Schraut said that Spring Hill had a mix of housing that was the fuel for the boom and subsequent bust. In many of the newer subdivisions, where homes sold in the $200,000 and $300,000 ranges during the boom years, current values are about half that.

But older homes in the original Spring Hill subdivision climbed as well because, relatively speaking, they became an attractive buy.

"They looked good against the new homes until the music stopped,'' Schraut said.

Residents in the 34613 ZIP code showed less of a drop because communities such as Brookridge and High Point didn't see the same kind of increases in property values.

Mazourek said some of the larger homes at the southern end of Royal Highlands and homes in upscale areas such as Glen Lakes also retained a bit more of their value.

Still, everyone took a hit.

Adding to the value slide, last year was the first time the county used foreclosures and short sales as part of its formula for figuring property values. Mazourek said he believes that will continue to be a factor for another couple of years.

Another variable, especially on the west side of the county, is sinkholes.

Mazourek's office tracks between 1,300 and 1,400 sinkholes verified by engineers and how they affect home values. A home with a sinkhole tends to drop 50 percent in value. A home with a sinkhole that has been repaired drops 10 percent in value.

Some people have raised concerns that residents who make a claim against their insurance for a sinkhole and collect money, but spend it on something other than the property, are contributing to the falling property values. Mazourek said there are ongoing discussions about how to address that issue.

"It's a big problem in Hernando and Pasco counties, and it's starting to expand throughout Florida,'' he said.

The falling values have plenty of people underwater with their mortgages, and Mazourek hears plenty about that.

"They just bought too much house,'' he said.

Others seem to understand that what is happening is a correction to a market that was way out of kilter.

"Basically they say they're getting back to where they should be,'' Mazourek said. "It was value on paper, not real value.''

Schraut said he knows that the last year has been bad, but the last three years combined have been disastrous for values. He routinely sees homes that sold in the $200,000 range now going for $70,000 to $80,000.

"It's a good time to buy,'' he said. "There was a time when you couldn't even get a vacant lot in Hernando County for what some of these homes are selling for.''

The flip side is not good news for sellers.

For Spring Hill resident Maria Briones, whose three-bedroom, two-bath investment property on Waterfall Drive is listed for sale at $180,000, there have not been a lot of bites. She purchased the home for $160,000 in 2006 and said she would sell "if I could get good money.''

The market value on the home is just $71,354, according to the Hernando County Property Appraiser's Office.

"For that,'' she said. "I stay with the house.''

Barbara Behrendt can be reached at behrendt@sptimes.com or (352) 848-1434.

Falling home values bring buyers' market in Hernando County 09/18/10 [Last modified: Monday, September 20, 2010 3:38pm]

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