Monday, January 12, 2009
Over the past week two different areas of Pinellas County, Florida were researched and examined in the process of completing appraisal reports. One is a condominium community in mid Pinellas County consisting of about 1,000 units in several buildings, built around a private golf course. An analysis of same unit resales and listings revealed prices and values within the complex declined by approximately 1% per month over the past year.
In December, 2008 the same type of analysis was done as part of an appraisal of a luxury Gulf-Front condominium. The assignment was to develop an opinion of value in a small, boutique project with only 8 units. Each of the condominium apartments had over 3500 square feet and were of very high quality construction. Kitchens, appliances, finishes and fixtures were all of very good quality.
At the time of the appraisal there were over 37 active listings of Gulf Front condominiums with over 3000 square feet of living area in Pinellas County offered for sale in the Suncoast Multiple Listing Service. The average listing price for these listings is almost $2,000,000. Some have been on the market for over two years.
Although an initial examination of sales and recorded deeds suggested this market has held up, closer scrutiny revealed many of the closings involved newly completed units; some of them under contract for as long as 18 months. An examination of listings revealed price reductions, expired listings and re-listing units at a lower price were common. Some developers have reduced prices on their existing inventory by as much as 32%.
After consideration of all the data, it was clear that prices and values for this category of condominium declined by about 18% over the past year. Considering the substantial inventory, it was my conclusion this trend would continue for at least the next few months.
If you or your clients are curious about the pricing of your listings, feel free to give me a call or an email. We're working on a number of assignments involving listings right now; helping folks get a clear idea of their market, the competition in the area, and the pricing level necessary to attract interest. We might be able to assist you, your seller or buyer make the correct decisions.