MARKET INFORMATION

Question: Which is worse: Selling in a Buyer's Market or Buying in a Seller's Market?

Answer: It depends on which stage of the cycle you buy and sell in. Selling at the beginning of a buyer's market still closer to the top or middle is good. Buying in the beginning of a seller's market mid way is good. Buying at the end of a buyer's market is o.k since you're in the middle of the whole cycle. Buying in the last quarter of a seller's market (Top) and them trying to sell in the last (Bottom) quarter of a buyer's market is the worst scenario. And that is exactly what has happened to a lot of nice folks who for what ever reason bought at the wrong time. You are always safe buying and selling in the middle for long term investing. However many people who bought at the top of the market are now trying to sell near the bottom. The best case is to buy low and sell high, which you can't predict, so buying and selling in the middle is safe and that is the period that we are beginning to transition into.

Interest is picking up as people are watching prices fall to tempting levels. As the interest rates are dropping in the mid 5% range, some people are realizing that it is a very opportune time to purchase select properties at reduced prices. Many sellers that have been trying to sell their properties for the past year or more are getting a very large dose of reality about market values and are finally reducing their prices to sell quickly. There are a lot of foreclosures and short sales to compete with. There are also many people who will sell properties for thousands, tens of thousand, and in some cases hundreds of thousands less than what they paid for them to get out of their increasing loan payments, insurance, taxes, and maintenance expenses. There are some individuals who have enough equity in their properties to sell them for under market values, which is a great deal at this time, and still make a great long term profit. If you are interested in selling, there are buyers in this market. They are however very well educated and have a great selection to choose from. So your property needs to clearly stand out as the best deal in its category of comparables in order to sell itself. It must be priced at what is percieved to be a great buy in this market. For example I have seen several newly listed properties priced so aggresively that they are selling immediatley for above asking price with multiple offers.

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So it is clearly evident that we are in a strong buyer's market with steadily decreasing prices. There are more pending sales as a result and the market is not nearly as stagnant as it has been. Interestingly enough, we are not still seeing the steadily increasing amounts of inventory. There is still excessive inventory on the market, however, in certain areas the inventory has actually decreased. This includes primary residences in Fort Walton Beach and Niceville. Both areas were holding about four hundred houses for sale Fall and Summer of 2007. Now they are both down to the low three hundreds. That is almost a 25% decrease in inventory. Some people are renting or moving back into there houses, some people are just withdrawing or letting their listing expire until things pick back up. But there are quite a few houses going pending and selling for great deals in an already corrected market.

There is still a gridlock with people wanting to upsize, down size, or make a latteral move. They are still watching the market and remaining on the sidelines unable to make a move because they are unwilling or unable to sell properties at current market value or because of insurance and tax issues involved with changing houses.

418 houses sold in Fort walton in 2007. 408 houses sold in Niceville. That is only about a 9 months supply of inventory available where it did reach record numbers at one point. There were 132 Condos sales on Okaloosa Island for 2007 which I found to be suprisingly high. Currently we have 392 active listings. (Feb 2008). We are not at the bottom yet but we must be getting closer to the bottom quarter. The true bottom will not be recognized until it is passed. Some of the worst areas for excessive inventory are Destin / East and Crestview /North. However this does provide an opportunity for even better bargains if you prefer those areas.

Now is a great time to buy property for a long term investment. However, short term profits are not likely in this market. The first 6 months of 2008 is definitely a better time to purchase property than this last three year downcycle following the peak of the market in July of 2005 just prior to Hurricane Ivan. Prices could remain where they are, or continue to drop for a while. But they could start to slowly recover sometime towards the middle to end of 2008. No one knows for sure. If you find the right deal and have holding power I believe you will make a decent return on your long term investment. Any one who is buying at this point will most likely not sell for less than they are paying at this time in the future. Therefore you could call that a bottom if you will. If you ever wanted to pick up any type of property now is the time to seriously start considering pulling the trigger on the right deal. If you would like for me to help find and secure a great deal for you let me know.

Don Oliver, self-proclaimed real estate economist.