Lisa Barton

• Median sales prices continuing to drop and sales prices in the Beaches area were down almost 30% from first quarter of 2009.
• Mortgage interest rates remained very low, particularly for conforming loans, making real estate very affordable.
• Inventory is still relatively high, giving buyers many homes to choose from.
• Entry level buyers and buyers seeking to take advantage of the tax credit, which expired at the end of April, were very active in the lower price ranges. Purchases of entry level homes were very high during the first quarter and will most likely be driving the market through the second quarter of 2010.
• For the first time in months, some of the beaches markets are seeing strengthening sales in medium priced homes and also in homes above $1 million.

On the downside, pressure from foreclosures and bank managed sales continued to be a big part of the beaches (and Jacksonville) real estate picture. While distressed properties are a relatively small part of the total Beaches inventory at 21%, they accounted for 30.5% of all sales in the past twelve months. Ponte Vedra Beach was the least affected by distressed sales, but even there, bank mediated sales accounted for close to 25% of closed sales. 

Lender mediated home sales prices at the Beaches are significantly lower than traditional sales—and because of their sheer volume, are affecting the overall median sales prices and leading buyers to believe that they should be able to get a “deal.” Given that foreclosures continue at record levels, it is likely that prices will continue to face downward pressure in the coming months. Until the upcoming inventory of distressed sales is purged seller mediated prices will continue to negatively affect property values.