The lazy days of September

Things are quiet in Cocoa Beach this time of year. The students are back in class and our winter visitors won't arrive for a few months. The water is still warm, we've had great surf for weeks, the fall mullet run is on, the fish are biting and you can play 18 holes with a cart at the Cocoa Beach Country Club for a paltry $24.



These are just a few of the reasons why I love Cocoa Beach and why September and October are my favorite months of the year.

Our market is quiet as well. In the last 14 days we have had only 25 residential properties contracted in Cocoa Beach and Cape Canaveral. That is our slowest rate of the year by a good margin. Our inventory has reached a new record level as well. We have crossed the 500 level in MLS-listed condos with 150 of those priced over a half million dollars.


MLS Stats for Sept. 25, 2005

contracts last 14 days

condos over $500,000____ 4
condos under $500,000__ 18

homes over $500,000____ 1
homes under $500,000___ 2

active listings

condos all prices_______507
condos over $500,000__ 150

homes all prices_______ 62
homes over $500,000__ 37

If you'd like to take advantage of the slow season in your property search, email me at larry@southcocoabeach.com or give me a call at 321.917.5786. Now, step away from the computer and go outside and enjoy the best time of the year. See you in or on the water.

Irrational Exuberance with a twist

Irrational exuberance. Those famous words were uttered by Federal Reserve chairman, Alan Greenspan, during a speech on December 6, 1996 in reference to soaring stock prices. Here is the entire speech for those of you so inclined.

Irrational exuberance is alive and well in our local real estate market but not where one would expect. In the red-hot real estate market of the last 5 years, there has been plenty of justified exuberance as values have skyrocketed. We have seen some property values double in less than two years. The fortunate property owners during this period have every right to be exuberant. The local newspaper has printed countless articles about high appreciation rates and increasing home prices. Buyers have been very aggressive in accumulating properties in order to participate in this unparalleled boom and prices have continued to climb, at least until now. It has become evident in my market, Cocoa Beach and Cape Canaveral, that the pace has slowed considerably. Buyers have become fewer and more cautious. The sellers, on the other hand, are being much slower to come to terms with the slowed market. I continue to see over-priced new listings and increasing inventory of homes and condos. The unwillingness of sellers to adjust their asking price to the new slowed demand has brought us to a teetering point. It can go either way. The buyers can regain their previous zeal for properties and resume paying ever-increasing prices or sellers can get aggressive and reduce prices to attract reticent buyers. My gut feel is that the irrational exuberance today is that of the unbending sellers, clinging to the hope of ever-rising values. As always, I could be wrong. I have demonstrated that capacity in the past. In any event, I believe that buyers should negotiate aggressively and use this softening to their advantage. Good luck out there. Do your homework and don't overpay.

Between Storms

An interesting thing happened this past week. Buying activity picked up significantly after being pretty much flat for weeks. We have seen 5 houses over $500,000 go under contract in just the last 7 days. I can't say for sure what spurred this burst of activity but the expected easing of Fed policy in response to the Katrina damage and the projected, prolonged low interest rate scenario could have eased some fears of a cooling market. Maybe buyers are realizing that whatever happens to the housing market in general, if you want a place in Cocoa Beach, now is better than later. We are seeing a still-increasing supply of homes and condos on the market but activity has picked up in a normally slow time of year.


MLS Stats for Sept. 10, 2005

contracts last 14 days

condos over $500,000____ 5
condos under $500,000__ 40

homes over $500,000____ 6
homes under $500,000___ 0

active listings

condos all prices_______455
condos over $500,000__ 134

homes all prices_______ 64
homes over $500,000__ 37

I received the pre-construction pricing for the Magnolia Bay third building this week. Ten percent down and a ten percent note held by the developer. One building left to be released. Expected completion, late 2006. If you'd like to receive the price list, email me. As always, be careful in your negotiations and do your homework. I'm off to catch the last of the Hurricane Ophelia swell.

Freddie Mac Grants Three-Month Suspension of Mortgage Payments for Borrowers Affected by Hurricane Katrina.

Freddie Mac News Archive:� Freddie Mac Grants Three-Month Suspension of Mortgage Payments for Borrowers Affected by Hurricane Katrina.: "Return of Some September Payments to Cash-Strapped Storm Victims Planned

McLean, VA – Freddie Mac (NYSE:FRE) today announced several special policies intended to put emergency funds in the pockets of single-family mortgage borrowers impacted by Hurricane Katrina.

'We are determined to do all that we can to help the victims of this disaster,' said Freddie Mac Chairman and CEO Richard F. Syron. 'Therefore, we are instructing our servicers to suspend mortgage collections for the months of September, October and November in some of the key major disaster areas designated by the Federal Emergency Management Agency. This temporary suspension will apply to every borrower with a Freddie Mac-owned single family mortgage in these FEMA designated zones, regardless of the condition of their home,' Syron said."

Read the entire article by clicking the link at the top.

After the Storm

When I wrote the previous post about calm weather ending for Cocoa Beach because of a small tropical storm, I couldn't have known how devastating a storm Katrina was destined to become. We have all been moved by the tragedy of the storm's effects in Louisiana and Mississippi. If you haven't helped out yet, please consider giving money to the American Red Cross or, if possible, volunteer your time to the Volunteers of America or any of the many organizations who are helping. In times like these the pulse of the Cocoa Beach market seems trivial when so many have lost everything.