Friday, September 12, 2008

Ahhhh, September in Cocoa Beach

Osprey riding the updraft over ocean condos this morning.

Welcome to the best time of year in Cocoa Beach. Summer is over on the calendar but the only indication on the ground here is the lack of traffic and small number of people on the beach. The summer tourists are gone, the kids are back in school and the snowbirds are months away from their annual influx. The weather is balmy and the water is warm and should stay that way through November.

A positive development this week is the dramatic decline in long-term mortgage rates following the Fed's bailout of Fannie Mae and Freddie Mac. 30 year fixed rates are once again below 6%. Real estate sales on the beach are slowing as they do every year this time. We fell back below last year's sales numbers in July and August and should follow the seasonal trend of declining total sales through November. That is positive for buyers and negative for sellers. Some of the more notable sales so far this month include;

5th floor direct ocean 2/2 Windjammer for $275,000
2/2 Beachwalk corner with boat slip and garage for $154,000
3 yr.-old, 3/2.5 River Gardens townhome w/2 car garage $175,000

One note about the inventory numbers below; there is a shadow inventory of luxury condos held by the developers that isn't included in the MLS numbers. By my unscientific count there are in excess of 100 additional over-$500,000 condos available for purchase in Cocoa Beach and Cape Canaveral that are not included in the MLS inventory of 78. If you're thinking of dipping your toes into this dangerous market segment, you need to understand the implications of this inventory and more specifically the implications of a high number of unsold units within a complex. You also need to thoroughly investigate the condo association's financials and budget. If the condo fees seem too low they probably are and will almost certainly be raised to adequately insure and maintain the complex. It's not uncommon for developers to keep fees low until a project is sold out. The owners at Crescent Palms can speak to this; the previous $300 a month has been increased to $505. Also, if buying in an older building, ask about upcoming concrete projects. Even if a seller is willing to pay the assessments for you, do you want to buy into a building just embarking on a project that could take two years to complete? Jackhammers and construction crews can make your beach experience less than idyllic. Grill your buyer's agent for all details about your target buildings.

MLS inventory Sept 12, 2008 Cocoa Beach & Cape Canaveral

Condos, all prices_____733
over $500,000________78 - 28 sold since New Year's Day
Single family homes___118
over $500,000_________42

My favorite, attractively-priced listings in the MLS right now include;

9-yr old, 4/2 half duplex steps from the beach for $210,000
Big, 3/2 canal-front condo with boat slip for $235,000
Big, 4-yr old, 4th floor, 2/2 direct river w/expansive views for $266,900
Big, 8-yr old side ocean view 3/3 for $299,900 (sold in '06 for $600,000)

If you have questions about our market or you'd like to know more about these or any other listings, please email me.

One last note about my earlier report on the Mystic Vistas auction in May; I incorrectly reported that 12 units had closed from the auction. The actual number of closed sales (as recorded on the tax appraiser's site through Aug.20) is only 11, less than half the number widely rumored to have been sold at the auction. It is entirely possible that the developer is giving buyers longer than the stated 30 days to close but, at this point, we're past 90 days and counting, so, it seems likely that 11 is the real number. If that changes, I'll update in a later post.

"Fast is fine but accuracy is everything." Xenophon