Average prices for property in Florida are still falling but the number of sales is increasing as more foreign property investors return to investing in the sunshine state, it is claimed.
Florida has been one of the hardest hit states in the US property collapse but it is still very popular with property investors looking for a holiday home.
Forbes Traveler magazine named Orlando Florida as North America’s top vacation spot in its newest ranking of destinations in the US, Canada, Mexico and the Caribbean and the state has always been popular with UK buyers.
‘Enquiries and sales are up. While the national housing bust has devastated property values it has also created some outstanding opportunities if you know where to look. There are clear indicators that the market is recovering,’ said Lee Weaver of Orlando-based British Homes Group.
According to IHS Global Insight’s Regional Estate Service, some locations in Florida are amongst the most undervalued places to live in the US.
‘What we have seen is that in markets such as Florida, California and Nevada that became significantly overvalued during the property boom are now very undervalued,’ said Jeannine Cataldi, senior economist at IHS Global Insight.
These include the upmarket retirement community of Naples on Florida’s southwest coast where property prices here have fallen by nearly 50% from the first quarter of 2006 to the first quarter of 2009 and IHS Global Insight now considers the average home price to be 33% undervalued.
In Sarasota, an upmarket, artistic community on Florida’s west coast prices plunged by 44% from the first quarter of 2006 to the first quarter of 2009 and are now reckoned to be 28% undervalued.
Figures from the Florida Association of Realtors show that the average price for existing Florida homes is down 28% from June 2008 and for condos it is down 37%. Now prices are starting to rise again. The latest figures from the Federal Housing Finance Agency show that prices rose 0.9% from April to May, the biggest jump since the housing bust began.
‘We think prices will bottom out later this year after three years of spiraling downwards so it is time to buy before prices rise,’ said Weaver.
However, economists warned that the real estate market in the US remains fragile. Randall Guttery, Professor of Real Estate at the University of North Texas said that an excess if inventory needs to go before the market returns to normal. And Amy Baker, the head of the Legislature’s Office of Economic and Demographic Research, said the real-estate market won’t bottom out until next year.
‘All the price declines that are in the pipeline haven’t materialized yet. There are multiple factors keeping prices low including distressed sales, foreclosures and just general price declines because people aren’t buying but some need to sell,’ she added.