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COMPARATIVE REAL ESTATE SALES DATA
(Part One) FRANKLIN COUNTY
This is the first of a series of four articles comparing three highly speculative coastal markets: from East to West, Franklin, Gulf and Bay counties - three contiguous counties bordering on the Gulf of Mexico, in the Florida Northwest. The first three articles will compare the volume and distribution of sales for the first five months of 2008 and 2007. The fourth and last article will attempt to discover patterns or trends based on the differences between these markets; these differences should enable us to better understand the current crisis affecting real estate nationwide.
In 2007, Franklin County was the smaller of the three markets with total sales of $67 million for the five months of January through May. In 2008 during the same months, sales went down four percent (4%) to $64 million.
Home sales for the periods were stable in numbers of transactions: 92. Noteworthy however is the different evolutions of new homes and resales. New homes are down -24% from 17 to 13. Resales are up 5% from 75 to 79. This is explained by an increased inventory of homes for sale, offering a wider choice to potential buyers, who can find what they want among the broad range of choices available, without having to look for new or to have to build. This last trend is confirmed overwhelmingly by the drastic drop in residential building permits filed with the county: they averaged 13 per month until mid July 2005...And have cruised down at 4 since mid 2007!
Another piece of the puzzle, pointing in the same direction, is the substantial decrease in the vacant lot sales: 110 sold during the first five months of 2007, compared to only 78 in 2008: a drop of 29%. Here again, with plenty of houses ready to be purchased, why bother with a lot? Why would anyone be assuming the headaches linked to many construction projects, when you can get what you want right now, already built, and painlessly?
An interesting twist to the residential lot sales is that the average price, countywide, has remained virtually the same $169,400 in 2007 vs. $171,100 in 2008. Yet, in 2008, you could get a better lot than in 2007 for the same dollar amount...
Last, let's have a look at commercial properties. Overall, since the onset of the real estate downturn, commercial values have been least affected - in part because they have been less subject to reckless speculation: commercial buyers tend to have sensible investment guidelines, which have prevented them from overpaying for properties. The first five months of 2007 saw five (5) commercial transactions... compared to thirteen (13) this year 2008! The total dollar amount invested in commercial properties went up from $2.79 million to $4.91 million for the first five months 2007 vs. 2008. Commercial properties are thus selling much better in 2008 than in 2007 (2.6x more).
Obviously, commercial investors seem to believe that the "bottom" has been reached! At this point, the reader must be reminded that, as a rule, commercial properties are the first ones to recover from the bottom of periodic real estate cycles - this seems to be a piece of good news in an otherwise overall grim picture.
In conclusion, Franklin County has been hit very hard and early in this recent crisis: the first signs of a slow down could be felt as early as the third quarter 2004, and the dance stopped almost entirely in the third quarter 2005. Possibly as a fair return of the pendulum, this county may be among the first ones to have hit, or be very close to hitting bottom. This view point is substantiated by the overall stable sales volume (expressed in dollars) registered for the first five months of 2008 ($64.4 million) when compared to the same period of the previous year 2007 ($66.9 million): the decrease was barely 4%, indicating that we have a stabilized situation.
Article written by Olivier Monod. Data courtesy of Metro Market Trends, Inc.
Posted by:
Olivier
Monod
Posted:
7/13/2008
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Olivier Monod
Contact
Olivier
:
Email: olivier@anchorfl.com
Office (local): 850.927.4000
Office (toll free): 800.525.4793
Olivier Monod visited the "Forgotten Coast" for the first time in 1981 and relocated permanently in 1988, joining Anchor as a real estate sales associate. He became Anchor Realty & Mortgage Co.’s broker and president in June 1990, overseeing three real estate associates and one employee in the single office on St. George Island.
Through Olivier’s vision and under his leadership, Anchor has grown to multiple offices, located along 85 miles of the "Forgotten Coast" and north to Tallahassee. With up to 80 real estate associates at the peak of the real estate boom. Anchor Realty & Mortgage Company posted sales of $235,932,037 in 2004.
In 2001, Olivier earned his designation as Commercial Real Estate specialist: CCIM (see ccim.com)
The drastic downturn in the Forgotten Coast real estate sales has forced the company to adapt in downsizing. We went from eleven to three offices. Many Realtors had to find other jobs and eventually left the profession. We are left with a small core of experienced veterans, whose loyalty for the company is only matched by their in-depth understanding of the market.
Olivier and his team have developed or sold many planned communities, including Gramercy Plantation, a 400-acre, low density, private community, with retail and residential areas in a high-end low density planned neighborhood. Gramercy Plantation was executed carefully to preserve the character and spirit of the area through dedicating substantial acreage to conservation and common grounds. The 110 home sites are scattered on minimum one-acre sites throughout the development.
Olivier, who grew up in Paris, first visited the U.S. in 1975 on a high school graduation trip; he fell in love with the country after touring from New York to San Francisco on a Greyhound bus. He subsequently moved to Florida and became a U.S. citizen.
A community leader, Olivier shows a keen interest in education and culture for our children through sponsorship of the ABC school (his two children and two step-children attend this local public school), and classical music programs for high-schoolers. Olivier and his family make their home in historic Apalachicola, in the Forgotten Coast.
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