As we enter the month of March, market activity is brisk, but, not across the board. Mortgage rates rose again this week for the 3rd week in a row to a national average of 5.77% for a 30 year-fixed rate mortgage. Florida today reports that existing home sales in Brevard county in January 2005 rose by 33 percent from January 2004. Statewide, home resales rose an average of 10% with some markets such as Miami, Ft, Lauderdale and Ft. Pierce/Pt. St. Lucie were actually negative over last year. This is a reflection of perceived higher value in Brevard County as measured against other more expensive areas in Florida.
Our beach market continues to be divided between hot and slowed segments. We are seeing good interest in condos priced under $400,000, mainly in existing complexes. The new waterfront complexes have pushed prices to levels that have nudged a lot of buyers to older complexes that are priced at more palatable levels. Direct river units today in older buildings range from $249,900 for a unit at Cape Shores to several in the $300,000 to $320,000 range in several other river complexes such as The Commodore, River Lakes and Harbor Isles. In oceanfront complexes, there are currently 154 units active in the MLS with prices ranging from $179,900 for a 1 bedroom, 700 square foot unit at the Saturn in Cocoa Beach to a pre-construction 5th floor penthouse at the Ocean Club in Cape Canaveral with 4 bedrooms and 3904 square feet for $1,279,900. A quick unscientific survey of the area in south Cocoa Beach between 18th St. and Patrick Air Force Base (about 3/4 of a mile) reveals a total of over 200 new condos either under construction or planned. Cheapest price I can find among these 200 plus units are a few units for $549,900 in the 77 unit Magnolia Bay project next to the Lobster Shanty slated to break ground next month. These 200 plus units represent over $150,000,000 of new high-end supply for our market in only a 3/4 mile stretch. New projects continue to sprout in Cape Canaveral with 131 new condos on our MLS this morning priced from $210,000 to $1,279,900.
I perceive a short-term oversupply of new construction condos. We are seeing multiple units on the market from investors in complexes such as Solana on the River, Bayside, Puerto del Rio, Mystic Vistas and Portside Villas. As of this morning there are 23 investor resales in Portside Villas in Cape Canaveral on our MLS ranging in price from $210,000 to $290,000. At these prices the investors expect to make $60,000 to $90,000 profit on their investments of $12,000 to $20,000. Not bad for a one-year play, IF, they can find buyers. A few contracts have already flipped for nice profits but the increasing supply may force prices down as the investors approach closing date. This project is still attractive as it represents the lowest prices for new beachside units.
Other new construction is marching ahead but I'm starting to see a lot of units languish on the market especially in the over-$500K level. In the last 90 days, 100 condos over $500,000 have hit the MLS in Cocoa Beach and Cape Canaveral. Only 14 units in this same area and price range have gone contingent in the same time period. This tells me that supply has, at least in the short term, outstripped demand. I would exercise caution with pre-construction condos and be aggressive with offers. We have shifted from a seller's market to a buyer's market in high-end condos in a very short time.
Good hunting out there. There are still attractive deals to be made for the well-informed buyer. All opinions and/or statements here are based on my own observations and research. Do your own due diligence before making an offer and, for your own protection, make the use of an accredited buyer's agent whether it's me or another qualified agent. As always, if you have any questions or need help acquiring your next property, email me or give me a call. I'm on the front line to represent you.
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