METRO MARKETS

Since the bust of the real estate bubble, people have become cynical about the state of affairs of the residential real estate markets in America’s major metros. While it is true that the residential housing market is depressed, it’s not all bad news.

According to the Fiserv Case-Shiller Index, which monitors and forecasts single-family home price changes in over 375 U.S. metropolitan cities, it is predicted that 75 percent of these metro cities will see stabilization in home prices by the end of 2011. According to this Index, despite price declines of up to 1.5 percent in the third quarter of 2010, home prices have leveled out in one out of four metro U.S. cities.

The Index points that after five years of record declines in home prices a few metro area housing markets are beginning to hit their bottoms. According to Fiserv, prices have already stabilized in the metro areas of Washington, D.C., San Francisco and San Diego. Furthermore, the Index states that as 2011 goes by, about 75 percent of the metro markets would bottom out and subsequently stabilize. Portland (Oregon), Minneapolis, and New York City are amongst those that will join the ranks of stability by the end of 2011.

Metros that are not expected to recover till the end of 2012 include Las Vegas, Phoenix and Miami, according to the Index. These three cities had the steepest declines in home prices. For the mid and smaller cities, the recovery in prices will be slow and an uphill battle because of the ongoing financial crisis and the large supply of foreclosed properties that continue to drag most of the nation’s housing markets.

The housing market situation in Central Florida is worth looking into from an opportunity perspective. According to the Florida Association of Realtors, home prices across the state of Florida have fallen about 20 percent since the past year. However, they are still about 13.3 percent higher than the past five-year period. But the good news is the volume of home sales is rising again, which is a signal that the market may be recovering. Thanks to the high inventory, conditions are ideal for buyers. Mortgage rates are at their lowest levels since the 60’s. Families that are looking to upsize can expect to get more home for their money.

According to several studies, Florida will continue to be the favorite retirement destination for the 80 million strong Baby Boomers. Central Florida in particular, where the healthcare and technology sectors continue to show healthy growth, is seen as one of the best bets in the nation as far as recovery and growth in single-family home sales.

Single family home sales in Central Florida reached 1,708 in March, which is a 36 percent increase over February. Over 10,000 properties were under contract waiting for closing. About 5,400 new listings were reported in March, which is a substantial increase. Consumer confidence is on the rise in Central Florida and interest from Canadian and European buyers continues to grow.