Jacksonville Report

Jacksonville, FL – Improvement Coming Slowly, but Still Seems Price-Driven (3,381 single-family permits in 2010, 26th largest market in the country) Traffic improves modestly as prices fall further. Buyer traffic improved modestly in February, as our traffic index rose to 50 from 46 in January, indicating overall levels in-line with agents’ expectations for this time of year (as measured by a reading of 50). Though this is the second straight month of traffic in-line with expectations, it may be a little early to say the market is out of the woods yet, especially since the better traffic seemed to be driven by further price reductions this month (in contrast to many other markets that saw better traffic and stable prices). One agent cited, “Great prices on available inventory!” Another credited, “prices and interest rates.” According to one agent, “There is less inventory in certain price points. Especially under $100,000. Buyers are also waking up to the fact that they can spend 5 months waiting on a short sale to happen or wait for new construction.” Another agent also noted, “good builder incentives, great interest rates, tightening market, stabilizing prices.” Home prices fall at start of selling season, despite lower inventory. Home prices continued to fall in February, as our home price dropped to 17 from 38 in January, well below a neutral reading of 50 (readings below 50 suggest lower home prices over the past 30 days). This is the lowest reading since late 2010, which is interesting considering the improvement in traffic and inventory trends. We will watch closely in the coming months to see whether this is just a blip or a sign of more meaningful price pressure beginning again. Inventory levels continued to trend lower, as our home listings index improved to 78 in February from 71 in January, well above a neutral 50. However, our concern remains that there is still a meaningful shadow inventory of distressed properties. The length of time needed to sell also increased again in February, reversing last month’s improvement, as our time to sell index fell to 28 from 42 in January (well below a neutral 50). John Holbrook - Realtor Amelia Island, Fernandina Beach & Yulee, Florida Cell: 904-415-0171 Email: holbrook66@msn.com Web: www.nassaumls.net www.johnholbrook.blogspot.com