Out Of Your Mind

Florida home sales jump as national market stumbles

0 Comments | Palm Beach Post, Jul 23, 2010 | by KIMBERLY MILLER

June was still sunny in the Sunshine State for existing home sales, with an increase in purchases bucking a national dip in buying blamed on the end of the tax credit.

Statewide, single-family home sales last month were up 8 percent compared with May and 15 percent over the same time last year, according to monthly data released Thursday by the group Florida Realtors.

Palm Beach County and the Treasure Coast saw a similar trend with purchases jumping 23 percent and 16 percent, respectively, in June over May.

“Everybody saw a slowdown for a second after the tax credit,” said Realtor Shannon Brink, of Re/Max Prestige Realty in West Palm Beach. “But a great home priced correctly is selling.”

The National Association of Realtors had expected sales to drop following the April 30 expiration of a home buyer tax credit, and while June buys reflected a 5.6 percent dip from May, they were still 8.5 percent above where they were in June 2009.

To cash in on the tax credit worth up to $8,000 for first-time buyers and up to $6,500 for some repeat buyers, a contract had to be signed on a home by April 30, with closing taking place before the recently extended deadline of Sept. 30.

Both the Florida Realtors and national association measure closed sales.

“Broadly speaking, sales closed after the home buyer tax credit will be significantly lower compared to the credit-induced spring surge,” said Lawrence Yun, chief economist for the National Association of Realtors. “Only when jobs are created at a sufficient pace will home sales return to sustainable healthy levels.”

One theory on why Florida’s sales were still climbing in June is that the state’s abundance of short sales, which take longer to complete, were still working through the spring tax credit buying timeline. Even if buyers signed a contract on a short sale by April 30, they could still be trying to close the deal.

Cut-rate pricing and historically low interest rates may also have nudged fence-sitting borrowers forward, said Bill Hardin, director of real estate programs at Florida International University in Miami.

“I think we’re getting to some price points that are very attractive,” Hardin said.

The median sales price in June for a single-family home in Florida dropped 3 percent from 2009 to $143,400 in June, while Palm Beach County’s saw a 7 percent decrease to $232,700.

The median Treasure Coast price increased 3 percent to $112,900
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