And we thought 2012 was going to be the year…

From a Forbes.com article written December 8th, 2011:Morgan Brennan, Forbes Staff

Cities Where Home Prices Are Falling Dangerously

The folks at Local Market Monitor, a Cary, NC-based real estate research company, compiled a list of the cities that suffered relatively big home price hits this year with more projected through the next 12 months. LMM sifted through market data for more than 300 Metropolitan Statistical Areas (MSAs) and Metropolitan Divisions (MSADs), as defined by the U.S. Office of Management and Budget.  The company, which releases quarterly housing market reports, crunched home prices from October 2010 through September 2011 and calculated price projections through September of next year. For its projections, LMM took into account job growth and unemployment rates, population growth, sales and rental prices, and something called “Equilibrium Home Price,” which is a gauge of where the average home price should realistically lie based on economic data versus where it actually is…

Every one of the 13 markets that made our list suffers from a glut of foreclosures. “Foreclosures are continuing to weigh down home prices in hard-hit foreclosure markets as the average sales prices of foreclosure-related sales drop,” explains Daren Blomquist of RealtyTrac, an Irvine, CA-based foreclosure listing site…

A foreclosure–studded state where home prices continue to get hammered is Florida.  Orlando and Jacksonville lost 11% and 9% of their home values this year, with 9.4% and 7.7% losses predicted in months to come.  The Metropolitan Division that includes West Palm Beach (West Palm Beach-Boca Raton-Boynton Beach, FL), Home Price Drop from Oct. 2010 to Sept. 2011: -8.5%, Projected Home Price Drop through 2012: -8.7%, also landed on our list.

Ingo Winzer, founder and president of Local Market Monitor, says two things are driving the dive in Sunshine State markets: too much inventory and not enough jobs.  Construction backstopped a sizeable chunk of Florida’s local economies, as developers built spec homes for an anticipated deluge of Baby Boomer snowbirds that, thanks to the current economy, have yet to retire. “First, a lot of homes were built, maybe more than should have been built, and second, while population growth in Florida will eventually sop up those properties, right now there’s no work so we have large numbers of homes sitting empty…causing prices (to continue to) fall,” he says.

As I consult with sellers, we go through the following exercise to determine whether to sell now or wait:  If we take the average value in the report, $211,000, factor in the projected decline, then factor in a hoped-for annual appreciation of 3.5% from then on, for a seller to just break even with what they would get with a sale today, they will have to wait until the end of 2016! So…if there is a need/desire to sell in the next 3 years…don’t wait and hope, now is the time.

If you are one of the “should I stay or should I go” owners…lets meet at my office (or your home) and see what decision is best for you.
Call me at 561 –602-1258 or