Sunday, October 22, 2006

Back to Basics

In our condo market, most activity has been bunched at the low end of the price scale. For the first 22 days of October, out of 10 closed condo sales on our MLS, only one was for more than $330,000. It closed at $490,000. There continue to be closings of brand-new high-end condos but they are not showing up in our MLS stats because only those that were flipped show in those numbers and flips have gone the way of the pterodactyl.

For the last 30 days, we have had 22 MLS-listed condos and townhomes close. Current total "for sale" inventory is 1014 units. My paper napkin math tells me that, at this rate, we have a 46 month supply. Digging a little deeper into the numbers we see 203 of those listed units over $500,000. There were 2 closings in that price range in the last 30 days, so, our activity is obviously lopsided. This snapshot absorption rate is somewhat misleading as September through December are historically our slowest sales months although it is not good news for sellers hoping to cash out before the end of the year. Until the bulk of our winter guests begin arriving in early 2007 expect to have major negotiating power as a buyer.

The cheapest oceanfront condo I can find today in our MLS is a 1 bedroom unit at the Saturn in Cocoa Beach with a side ocean view for $169,900. There are several dozen direct ocean units in the $300-$350,000 range including one 2nd-floor, 3 bedroom direct ocean unit in south Cocoa Beach for $349,000. I find 14 units listed for over $1 million with the peak represented by a 4617 sq.ft. unit in Cape Canaveral for $2,750,000.

I'm seeing more and more buyer's agent bonuses and higher commissions being offered out by sellers. Their intent is to somehow entice agents to favor their properties over others. Makes more sense to me to just lower the price, but, maybe a seller's pride can be left more intact by getting closer to their mental target price and paying higher costs. As a buyer, why not ask your agent for that bonus at the same time you're asking the seller for concessions. You are the one bringing the money after all, so, in effect, you have paid that bonus buried in the selling price even though your agent may not have disclosed to you up front that she was receiving a bonus. Our MLS, for some reason, hides the bonus amount on the customer printouts. Read my previous post on this subject here.

If you can, try making it to the beach soon. The water is still warm, the mullet run is still happening and the beaches are deserted most days this time of year.

Here's a snook from the surf on October 25.