Nov 20, 2008 11:42 pm US/Eastern
South Florida Home Price Drop Double US
Click Here for a comple list of cities.
MIAMI (CBS4) ―
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A sign indicating a reduced price is posted in front of a home for sale.
AP
A new report shows home prices fell in a record 4 out of every 5 cities in the third quarter, and in South Florida, fell by almost 17 percent when compared to the same time one year ago, as the real estate market was flooded with foreclosures and stalled by alarming economic news. The South Florida decline was nearly double the national average price decline.
As bad as that sounds, it's not the worst news in Florida. That distinction belongs to the Cape Coral-Ft. Myers area, where home prices fell a whopping 31%, the 5th worst decline in the nation among cities surveyed. Miami-Ft. Lauderdale's decline was the nation's 20th worst, still better than 4 other Florida metro areas.
The news in South Florida is almost as bad for condo sales. Even as builders continue to bring new buildings on line, condo sales prices in Miami-Ft. Lauderdale dropped 14.6 percent compared to the same quarter last year, more than double the average national decline. That equates to the 13th worst decline of all cities surveyed.
Among 152 metropolitan areas included in the trade group's survey, 120 posted declines in median home sales prices compared with a year ago, the National Association of Realtors said Tuesday.
Nationally, sales fell by almost 8 percent in the third quarter compared with the same period a year ago.
Sales fell in all but four states in the Realtors group's report. The exceptions were Nevada, California, Arizona and Virginia, where buyers have been able to snap up foreclosed homes at a bargain.
While the news regarding the number of foreclosures is distressing, transactions in foreclosed homes virtually led the real-estate business. Sales of foreclosures and other distressed properties made up around 40 percent of transactions in the quarter, bringing down the median price by 9 percent from a year ago to $200,500.
"A very large proportion of distressed home sales are taking place at discounted prices compared to more normal conditions a year ago," Charles McMillan, the Realtors group's president, said in a statement.
A nasty brew of strict lending standards, falling home values and a tough economy is filtering through the housing market.
By the end of the year, foreclosure listing service RealtyTrac Inc. expects more than a million bank-owned properties to have piled up on the market, representing around a third of all properties for sale in the U.S.
Meanwhile many economists believe the economy has fallen into a recession that could be the worst downturn in more than two decades. As layoffs accelerate, that's likely to put further downward pressure on housing prices.
Freddie Mac reported last week that rising unemployment rates, tightening credit and deteriorating economic conditions "contributed to a substantial increase in the number of delinquent loans," including loans made to borrowers with strong credit.
Freddie Mac has 28,000 foreclosed properties on its books, while its sister company, Fannie Mae owns 67,500.
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