Home Sales Rise in Florida, Sluggish in LA

Published by julia | Filed under Buyer / Seller Tips, Market Trends, Pinellas County Homes, Real Estate

May was a better time for Florida, as sales rose to 16,745 single-family residences from 14,172 same month last year, marking an 18 percent increase. Likewise, the median price has increased by $300 in a month’s time, from $140,100 in April to $140,400 in May. For the 3rd consecutive month, the median price has continued to increase. On the other hand, median price this May has decreased by 2 percent from the same month last year. In May 2009, house median price was at $143,800.

Condominium sales are also picking up. The year-to-year comparison indicates that there is a remarkable 40 percent change condo sales. From 4,845 units sold last May 2009, it increased to 6,779 units this May. Similarly, condo median price has dropped compared to last month or last year.

Sales continue to rise because good properties were sold at reasonable prices, and this kept the interest of buyers at bay. Also, mortgage rate is at its all time low for 39 years, sparking more interest from homeowners to-be.

Though real estate in Florida showed signs of recovery, citizens are asking for how long will this carry on. For one, the gulf oil spill has affected the beaches of Florida, as the state is well known for its coastal area. The long term effects of this unfortunate event are also uncertain. Secondly, tax credit has expired in April. This has been a great motivator of homeowners to continue with their mortgage payment. With this gone, borrowers need to be financially stable enough to be able to make the monthly mortgage.

Meanwhile, Los Angeles real estate remains to be sluggish. In the midst of falling mortgage rate and amiable housing policies, sales continue to drop. Interest rate has already set a 4.69 percent for a 30 year fixed-rate payment record low and still people are not buying it. The reason? People complain of very high housing prices. Even couples who earn 6 digits claim they cannot afford a house in LA, but would opt for renting instead. People prefer a low principal amount. So even with a small monthly interest but with a high principal base, they still find it beyond their ability to pay. Because of this, new units sales have dived by 32.7 percent in a month’s time, marking the lowest slump in 47 years.

In order for the industry to improve, there is a need to seriously address unemployment. All these recovery can be made sustainable if more jobs become available in the market.