Wednesday, October 25, 2006

Seminole County Real Estate Update

Seminole County Property Appraiser David Johnson said Seminole County’s residences have not experienced the decreases in value that some real estate markets have.

Johnson provided updates on current issues affecting the local real estate market as the first of two guest speakers at Thursday’s Sanford Chamber of Commerce luncheon. (See separate story, Page B8.)

Johnson said despite the large number of houses currently on the market, Seminole County homeowners have not yet seen a high degree of price deflation when selling their homes.

According to Johnson, the average single family home in Seminole County now sells for $268,000 — compared with $246,000 in 2005 and $196,000 in 2004. The increase in property values has led to dramatic increases the amount of property taxes collected by the county and the seven cities within the county, with property taxes serving as the primary finding source for local governments and the county school system.

The total taxable value on the county tax roll increased by about 24 percent in 2006, Johnson said.

“That’s a lot, but what’s more impressive is that the taxable value in Sanford went up 37 percent,” he said. Johnson praised the efforts of the Chamber of Commerce and the city of Sanford in working to create a real estate market that people want to buy into.

“People want to live here,” he said.

On a less positive note, Johnson said there are currently between 20,000 and 25,000 residential properties currently on the market in the Orlando area. “It has definitely switched from a seller’s market to a buyer’s market,” he said. Many of those properties were purchased during last year’s real estate craze when investors jumped into the real estate business thinking they could flip the properties for a quick and easy profit. That same mentality led local builders to increase the number of homes they were building so they too could cash in on the skyrocketing prices.

A year later, many of those units now sit unsold.

“When you read about a trend in the newspaper, it’s already too late,” Johnson said, which led to many nods of approval from his audience. He said he expects to see many of the properties currently for sale being taken off the market while owners wait for the market to turn around again.

“I don’t think the sky is falling, it’s just a matter of getting some of these properties sold,” Johnson said. He added that he remains encouraged because interest rates are relatively low and the growth rate in the county remains strong, due in part to the quality of the county school system.

Johnson said he believes the high number of condo conversions in recent years have contributed greatly to the current real estate climate in the county. In 2004 there were around 9,000 condominium units in the county. There are now about 15,000.

“About 8,000 units came into the market almost over night. There’s no market that can absorb that that quickly,” he said.

Johnson said this trend forced a lot of potential homeowners out of the market and added to the lack of affordable housing in the county. Courtesy The Sanford Herald 10/22/06.