Jacksonville, FL – Bargains Bring Buyers Back to the
Market, Although Many Buyers Still Lack Confidence
(5,135 single-family permits in 2008, 18th largest market in the country)
Traffic improves, modestly above expectations. Buyer traffic improved in June, coming
in slightly above with agents’ expectations for this time of year as our traffic index
increased to 54 from 30 in June (any reading below 50 suggests traffic below agents’
expectations). The key driver of the improvement was traffic from buyers seeking to take
advantage of the foreclosure bargains and other buyers who need to move. Agents
described significant pent-up demand from buyers who have stayed on the sidelines as
they have waited for pricing to bottom out. However, we continue to see little demand
outside of the foreclosure and short sale market, as buyers don’t view traditional sales (i.e.,
non-distress sales as bargains). The tax credit for first time homebuyers was cited as
helping to improve traffic, although the low foreclosure prices might have been sufficient
on their own.
Falling inventories, but continuing pressure on home prices. Agents reported that
home prices fell in July, with our price index registering 25, up slightly from 20 in June, but
still below a neutral level of 50 (any reading below 50 indicates lower home prices over the
past 30 days). Inventories, however, moved in the right direction, as our home listings
index registered 58 (better than 40 in June) and with a reading above 50 indicating falling
inventory. Our time to sell index, which effectively reflects trends in both traffic and
inventory, increased to 50 in July from 40 in June, with a reading of 50 indicating an stable
time needed to sell a home. The trend in this metric will be important in August as a
declining time needed to sell a home would likely be a leading indicator of better pricing
trends.

John Holbrook - Realtor 904-415-0171