Monday, February 8, 2010

Jacksonville Area Real Estate Report

Jacksonville, FL – Momentum Returns as Buyers
Focus on Attractive Affordability

(5,135 single-family permits in 2008, 18th largest market in the country)

Traffic rebounds in January. Buyer traffic regained momentum in January after declining in December, as our traffic index improved to 50 from 35 in December in-line with a neutral reading indicating traffic levels consistent with agents’ expectations. Agents with positive commentary this month attributed the improvement to people moving past the holiday season and focusing on the attractive affordability currently available. One agent highlighted the combination of “pricing, inventory choices, and low interest rates,” as factors that led to better traffic levels in January. Others said that cheaply priced foreclosures remain a big draw for buyers.

However, some agents were not convinced by the improvement, noting an increase in activity relative to December is typical, so it is tough to tell how real this is. We think there will likely be further improvement over the next few months based on the upcoming expiration of the homebuyer tax credit, likely followed by another(hopefully) temporary lull in traffic after April. Prices fall, inventories rise. Home prices continued to fall in January, likely as sellers tried to draw buyers back into the market, as our price index fell to 25 from 35 in December, with any reading below 50 indicating lower home prices over the past 30 days.

Incentives also increased, as our incentive index dropped to 30 in January from 60 in
December (readings below 50 point to higher incentives). Still, inventories increased
(although some of this is likely due to normal seasonality), as our home listings index fell to 33 in January from 55 in December, with readings below 50 indicating higher listings. We think the high foreclosure levels will continue to pressure inventories and weigh on home prices in the coming months.

John Holbrook - Realtor Amelia Island, Fernandina Beach & Yulee, Florida
Cell: 904-415-0171 Email: Web:

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