Thursday, September 13, 2012

Jacksonville Report

Jacksonville, FL – Buyers Hesitate on Pricing Worries (3,245 single-family permits in 2011, 27th largest market in the country) Traffic remained below expectations in August on market uncertainty. Traffic slipped in August and fell below agents’ expectations, as our traffic index came in at 25 (from 38 in July), with readings below 50 pointing to less than expected traffic for this time of year. Agents attributed the decline in traffic to general uncertainty. One agent mentioned, “Traffic has taken a seat since June when it was at its best. I think the fact that prices are still falling has something to do with it. Buyers don’t really feel comfortable entering at this time.” Another agent added, “The election is giving reason for buyers to pause. They don’t want to make any commitments while they’re still unsure of what to expect in the upcoming years.” In addition, while lower inventories have helped spur demand in some markets, agents noted that, in Jacksonville, buyers have shied away from the current availability. Prices remain flat in August. Prices remained flat in August, as our home price index came in at 50 (unchanged from our reading in July), with readings of 50 pointing to flat pricing. Meanwhile, inventory levels continued to fall in August, as our home listings index came in at 72 (from 69 in July), above a neutral reading of 50 (points to lower inventories). We view this as a positive for future pricing. In addition, our time to sell index came in at 67 (from 56 in July), above a neutral reading of 50 (points to a reduced time to sell). We view this as a positive for future pricing. However, we think the high backlog of distress inventory not yet held for sale could hinder prices going forward. Comments from real estate agents: ■ “The market is full of short sales. Lenders are taking a long time to respond and buyers are starting to walk away.” ■ “The beginning of school has taken traffic down slightly.” John Holbrook - Realtor Amelia Island, Fernandina Beach & Yulee, Florida Cell: 904-415-0171 Email: Web:

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