[October 27, 2008]

Home prices in Palm Beach County, Fla., resume tumble

(Palm Beach Post, The (FL) Via Acquire Media NewsEdge) Oct. 25--The region's housing market still hasn't hit bottom, numbers from the Florida Association of Realtors suggest.

The median price of a single-family home in Palm Beach County fell below $300,000 in September, although sales picked up from a year ago as buyers snapped up foreclosures at bargain prices, the group said Friday.

After rising to $323,300 in August, the median price in Palm Beach County fell back to $292,200 last month -- down 18 percent from September 2007.

For the month, Realtors sold 522 single-family homes, up 11 percent from a year ago but down 16 percent from a month ago.

Prices in the Treasure Coast continued their free fall. The median price of a single-family home in Martin and St. Lucie counties dropped to $138,000, down 32 percent from a year ago and off nearly 50 percent from the September 2005 peak.

However, the number of sales in the Treasure Coast spiked 45 percent from a year ago as bargain-hunting buyers took advantage of foreclosures and short sales.

"The lower prices result from the fact that people are out there buying the deals," said Vince Laviano, head of Realty Executives -- Treasure Coast and president of the Realtor Association of Martin County. "Buyers are out there, and what's getting their attention is price." Those buyers will have plenty more price cuts to grab their attention, many predict. The region faces a glut of homes for sale and a flood of foreclosures being dumped on the market that will depress prices further.

Home prices in Palm Beach County and the Treasure Coast are "still crashing," said Mark Zandi, chief economist at Moody's Economy.com.

"The market's still under extreme pressure," Zandi said. "It's overwhelmed by unwanted inventory and rising foreclosures." But the increase in sales offers evidence that bargain-priced properties are moving.

"There are some early positive signs that foreclosure sales are starting to pick up, and that's the first step," Zandi said. "We are at the beginning of what might be a long, painful ending. But there still need to be more price declines." He expects home prices in Palm Beach County to drop an additional 10 percent to 15 percent as values fall in line with incomes. He also predicts that the county's pricey mansions no longer will buoy the market. Buyers of those properties are feeling the sting of the stock market's drop.

"All households, even high net-worth households, are getting hurt in the past eight to 10 weeks," Zandi said.

Palm Beach County's median condo price was $139,800, down 22 percent from a year ago, but sales spiked 35 percent.

Nationally, the median home price fell to $210,500, down 9 percent from a year ago. But sales were up 1.4 percent from September 2007, and Realtors pointed to falling inventories.

"This is the first time since November 2005 that home sales have been above year-ago levels," National Association of Realtors President Richard Gaylord said in a statement. "Credit tightened at the end of September, but the improvement demonstrates that buyers who have been on the sidelines want to get into the market to make a long-term investment in their future."

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