Florida's Battered Home Market Hits Another Low
Countering earlier forecasts of recovery, slumping Case-Shiller price index says 'no relief in sight'
Around the State
The prospects for Florida's economic recovery took a new hit Tuesday, with a widely followed housing index reporting yet another price drop.
The national S&P Case-Shiller price index tumbled 4.2 percent from the first quarter, and was down 5.1 percent compared to its year-ago level. It was the eighth straight monthly decline.
"Home prices continue on their downward spiral with no relief in sight,” David Blitzer, chairman of S&P’s index committee, told the Wall Street Journal.
The news was particularly ominous for Florida, where foreclosures remain high and prices have plummeted farther than the national averages.
The Case-Shiller report also punctured predictions for a turnaround this year. Back in 2009, Florida economist Hank Fishkind forecast that the state's housing market would rebound "by 2011."
But amid continued double-digit jobless rates and a stalled housing market nationally, Florida real estate remains stuck in the mire.
Earlier this month, the NAHB Housing Market Index, an indication of the sentiment of builders, came in at a lowly 16. A reading below 50 suggests a negative outlook by builders.
"The reading has not been above 50 since April 2006," reported George Leong, senior editor at Lombardi Financial.
The only bullish indicator -- if it can be called that -- is in rental property.
A national survey this week reported that the percentage of rented homes grew in more than 500 U.S. cities -- and several Florida cities far outstripped the national average.
Among the biggest gainers: Boynton Beach (+6.4 percent); Gainesville (+9.8); Jupiter (+6.4); North Port (+12); Palm Coast (+10.1).
With experts citing Case-Shiller as signaling a national housing "double-dip," Florida remains in a slump that began in 2006. That continues to blow a hole in the state's labor force, which is tied closely to residential construction and the real-estate market in general.
Though home sales have increased sporadically, and the Miami market has been propped up by foreign investors, notably from Europe and South America, overall Florida home prices have fallen steadily amid ongoing oversupply of inventory.
Adding to the misery, and making a housing rebound increasingly unlikely, strapped consumers are spending more of their household budgets on essentials like gas and groceries.
According to the Florida Association of Realtors, the median sales price for existing homes in April was $131,700 compared with $140,300 a year ago -- a 6 percent decrease. Sales volume was up a modest 2 percent.
Florida’s condo sales showed a bit more life, rising 20 percent year-to-year. But median prices in the sector were still down 8 percent to $91,900.
Though market hucksters have been saying for years that "There's never been a better time to buy," prospective purchasers are holding off, figuring that prices still haven't bottomed out.
Today's Case-Shiller index gave no indication that the bottom is near. It reported that year-to-year home prices were down 6.9 percent in Tampa and 6.1 percent in Miami -- their lowest levels in nearly four years.
The only city among the top 20 metro markets to register an increase was Washington, D.C., up 4.3 percent.
Reach Kenric Ward at firstname.lastname@example.org or at (772) 801-5341.