January 2009 

I have seen the Brevard County Florida Real Estate market come full circle. Currently, we are experiencing a market correction. Our property values went up by 180% within a 5 year period!

In 1996, I remember when starter homes were selling for $30K, $40K and $50K! Homes were taking 8 to 10 months to sell (seems unbelievable at those prices, doesn't it?). If only we knew then, what we know now.

I buy, sell, rent, own & manage my own investment property and have since 1996. I buy 1 to 2 houses a year. I've sold a few along the way. I understand the dynamics of the market, both locally and nationally. I have worked with many investors buying, selling and renting their own properties. In my opinion, Real Estate is a long term investment. Wealth is created over time.

Investors had previously lost money in the tech stock market bubble. Many shifted to real estate. In 2005 homes were selling in Brevard for over-inflated prices, the market peaked. Many were optimistic that the market would continue up! House flippers were scooping properties up, which drove prices through the ceiling! It was just too good to be true. There was a shortage of homes available for sale. In January 2005, in a 5 mile radius within Melbourne, there were only 4 homes for sale below the $200K mark! I remember the year before, when there were 135 houses for sale under $200K in the same area! Many of those were even priced below $100K.

After new owners bought at 2005 peak prices they got their tax bills based on their new higher assessed values. They didn't anticipate such a blow. We we were then visited by a couple of storms, namely Frances and Jeanne. Property insurance rates doubled. Then, to make matters worse, owners interest-only, 100% financed, negative amortization, adjustable rate mortgages readjusted upward. Owners had to get out. The market began declining with the overabundance of homes being put on the market. House flippers were caught with over-inflated priced houses. Unknowing homeowners were stuck with mortgage payments they couldn't afford.

Thus, the subprime mortgage mess.

Our economy is going through a market correction. 

We don't know for sure how long our market correction will last. None of us has experienced a market like this. However, one thing is for sure...interest rates are historically low and prices have decreased. We are currently in a buyer's market in Brevard with an overabundance of inventory for sale.  There are hundreds of foreclosures on the market that are undercutting pricing. Smart investors have gotten back into the market and are picking up some very attractive deals on competitively priced properties.  First time home buyers are also buying, as they are not waiting for something else to sell. Some owners must wait for their home to sell, before they can move forward and buy something else.  Buyers looking for a vacation home are currently out shopping for upper end properties.  The question is, have we reached the bottom of the market yet? It may take some time to clean up the mess of the past several years, but we'll just have to wait and see what 2009 will bring.    

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