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Florida Keys Real Estate Update

February 15, 2011 Real Estate Reports

Well here we are…….smack dab in the middle of our real estate season here in the Florida Keys.  Many out there are wondering what is happening down south with property prices.  Well I am seeing a mixed bag.  Prices seem to be firming, however, there still are some sellers having to sell.  Net ……net, one is offsetting the other.  Higher end properties (over $1,000K) are stable.  Lower end (Under $250K) are stable and the middle is where the weakness is.  I have seen what I call some “Fire Sales” , however they seem to be appearing less and less.  Again, there are opposing forces at work netting out to a relatively benign pricing environment.  This could be a bottoming process, but only time will tell. 

What we need to watch out for is the effect of what I call the shadow inventory. That represents the FSBO’s and the Banks that have not put their inventory out there.  However, it may not be as ominous as it seems.  This writer believes that we are getting to a point where replacement costs in many cases of some of these homes are close to parity after you add a realistic price for the land / dirt underneath the home.  This should put a floor /lend support to valuation and be an offfset to the shadow inventory I just mentioned.

Just thought I would throw some thoughts out there for everyone to consider.

Be Safe….Stay Well