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Historical data on HUD bids in Tampa for the last 60 days.

 

I was reviewing the data on the government owned (HUD) houses that have gone under contract in the last 60 days in Tampa.

There were 30 total transactions that went under contract in that time period.

7 of them went for the full asking price.

10 of them went for greater than the list price. They ranged from a high of  21% over list to 1.5% over list.

13 of them went for less than list. The range was a low of -29% to -.5% under list.

since this is a new statistic we don't know what it means yet or what the trend is. We'll just keep poking away at it for a while and see what we can glean from the data with some seasoning. All these figures were extracted from the NHMS web site on 4/21/10.

 

 

	Sales Statistics For The Bay Area
		Hillsborough County
Month	Active Listings	Sold For Month	Sold Last Year
Mar-10	9,240	1,334	1,085
		Pasco County
Month	Active Listings	Sold For Month	Sold Last Year
Mar-10	5,450	601	509
		Pinellas County
Month	Active Listings	Sold For Month	Sold Last Year
Mar-10	11,885	1,284	958

Tampa is showing a 19% gain over year to date.

Pasco is a little bit less at 15% over last year. They also have a greater percentage of REO’s to listings than the other two counties.

Pinellas is the biggest gainer with a 25% increase over last year. Of course the big BUT! Is they are the smallest of the three bay area counties and have the greatest number of listings. They have a longer way to go.

 

 

	Clearwater Beach Condos
2010
Month	Active Listings	Sold For Month	Sold Last Year
March	441	31	27
	St Petersburg Beach Condos
Month	Active Listings	Sold For Month	Sold Last Year
March	1,018	77	36
	Tampa Total Condo Count
Month	Active Listings	Sold For Month	Sold Last Year
March	1,552	200	116

Looks like Clearwater is still flat for year to date.

St Pete is showing significant signs of improvement, Tampa as well.  Financing is still a big issue with condo sales. Many of the communities do not qualify under the new guidelines set up by the government.

Although the market may be uncertain if you are an investor that wants to buy and turn over your investment property for a profit and move on, it's a different story if you want to become a landlord.

The standards are a bit different. We look at returns and cash flow rather than short term profits. Not that there's anything wrong with profits! It's one of the main pillars of capitalism, my favorite economic system. As I always say . . . First rule of business "get the money!"

Back to being a landlord . . . I just found a property in a decent neighborhood for one of my landlord clients. It's a cookie cutter garden variety 3/2 that's only ten years old for $54,000.

 

 

This was a foreclosed property in Temple Terrace. You may wonder what the interior looks like, considering what a lot of foreclosed homes go through during the process, well, see for yourself! Not bad.

 

It wasn't perfect by any means. The central air conditioning was completely removed as was the water heater.

My investor is getting a new A/C for $2,600 completely installed. Water heaters are not that much money. The only thing left is a quick coat of white paint and some appliances. That's much less than $7,500 in repairs and we can rent the place for $950/ month. You crunch the numbers. They're great.

On my end as the agent, I get paid for the transaction and I get paid to get it leased up! Not bad, almost like double ending the deal. On top of that my investor is very happy with me and looking for seconds.

One of the interesting parts of this deal is this house was not financable in the condition it was in, yet it's a block construction home only ten years old and in a decent neighborhood for much less than $50 / square foot!

Now these values don't grow on trees, and we do miss some to buyers that are a bit over exuberant in their bidding. but We'll pick up several a year.

If the banks keep being unwilling to rehab their properties so they can get them financed by mom, dad and the kids, they are going to end up giving away nice homes in good neighborhoods to the only buyers in the game . .  . Cash buyers. The prices on that quality of home will keep going down too. We can only sell what's out there. We don't make the market, we don't own the houses. Soon enough there will be two classes of houses  and two markets. Cash only houses and homes for families.

We live in interesting times.

 

 

 

I was reading in the Tampa Tribune business section this Sunday that FHA loans were accounting for about half of all new transactions. If that includes cash deals, likely FHA's are accounting for closer to 75% of all financed deals. This last year or so that's been my experience. With the murkey lender requirements for conventional transactions, they have become few and far between. The article went on to say that the default rate of these mortgages has increased. Well I guess so . . . Around here FHA is known as the new subprime. The standards are certainly not what they once were. Remember VC reports? Not anymore. How about seller mandated costs? Hummmm. I am guessing that this has affected our price points as well . . . . Downward. We're still waiting for next wave of REO listing to descend upon us. Can't wait to see what that does to the prices, now that they have finally appeared to have stabilized some. Going to have to figure out soon what to do with all these vacant houses. We no longer have to population to fill them up, now that all the construction crowd has moved on and taken their vendors with them. 

Greater Tampa Bay area housing prices declined once again by a significant number. According to the S&P  Case /Schiller index we declined another 15.2% over last year for October. This compares nationwide to a general rise in prices for the fifth straight month. Many experts were of the thought that our prices had stabilized.

We had been blessed with modest increases in June, July and August. Things were looking up. Then this. To add insult to injury, the home price index hit 140.27 in October. This is the lowest figure it has reached since the great run up.

Take heart, we're not alone . . . Chicago and Hot ‘Lanta were next on the decline list.  Both were off by 12% annualized. Misery loves company. In fact only eleven of the twenty cities that the index tracks showed gains. Just a little over half, the rest either were stable or like our case, declined. Doesn't look like to me that the housing recession is anywhere near over.

The easy money from Fannie and Freddie is supposed to come to an end early this spring. Now Bernanke is mumbling about raising interest rates.  Since almost all of our buyers are first time FHA borrowers, we can see how that will go . . . Down hill.  Once the banks are forced by the Fed or their regulators to release their next wave of REO's I can see little way in improvement for our prices either.

 

Most anybody can tell you there are a lot more homes that are standing empty and abandoned than are for sale as foreclosures in just about any community around here these days. The why of this and the when of marketing them is important enough, but what it speaks of our area has consequences that I have not heard anybody talking about yet.

We are experiencing a population flight from our area that is greater than is being owned up to by reporting agencies. We are being abandoned and thousands of homes are being abandoned as well. Since this is my home and I’m a bit long in the tooth to just pick up and start anew elsewhere, I’m concerned.

The boom years of the early and middle aught years were fueled by construction and easy money. It attracted tens of thousands into the Tampa area. They built homes, sold tile and carpet or windows, made loans and worked in real estate or title companies. When it busted, they moved back out. Now we have all these houses and not anywhere nearly enough population to fill them up regardless of the price.

Now many of the houses are deteriorating to the point that  lenders will not lend on them. They either cannot afford to or will not fix them up so they can sell them to families that want to buy homes to live in. There’s only so many cash buyers out there that are in the rehab business. If they go through a long hot Tampa summer without air conditioning, the ensuing mold bloom will make them permanently uninhabitable. That will be worse that the Chinese dry wall issue.

Without a new economic engine to drive growth and commerce, we’ll be hard pressed to get the housing problem corrected for a lot more years than anyone can imagine. The last time an event that was even marginally close to what we’re currently experiencing occurred was the savings and loan debacle of the late 80’s. That can’t hold a candle to this one and it took nine years to snap back from that one.

 

I hear a lot of talk about the disproportionate number of short sales we have in our area. I did a search of the MLS database and here’s what I found:

April 2010
County	Total Listings		Short Sales	REO Listings
Hillsborough	9257		3267	310
Pasco	5423		1433	1539
Pinellas	11900		2304	257