Existing Home Sales Improve Slightly

Buoyed by improved affordability, existing single-family home sales in Hernando County rose in September.

There were 204 sales in September, compared to 126 in September 2007, according to multi-listing services statistics.

Barbara Hahn, president of the Hernando County Association of Realtors (HCAR), said there are many great deals out there if a person is in a position to buy.

The average sales price of a new home is $147,352, down from $175,010 last year.

Many recent sales are foreclosed homes and "short sales" - where the seller is willing to take a lower price for the home than what is owed the bank.

Another positive sign: The county's housing inventory shrank from 4,350 during its highest point in 2007 to the current level of 3,520.

"If we can get (those homes) out of the way, our market will readjust and we'll get Hernando County back on track," said Hahn, broker for A-1 Realty.

Hahn said her realty firm and other brokers reported stronger sales from July through August. But a financial crisis on Wall Street, coupled with a wariness leading up to the national election, has slowed the pace, she said.

Also, Hahn said banks have tightened their lending policies, making it harder for homebuyers to obtain credit, a concern shared by Lawrence Yun, chief economist with the National Association of Realtors.

"Home sales will be constrained without a freer flow of credit into the mortgage market," Yun said. "The faster that happens, the sooner we'll see a broad stabilization in home prices that in turn will help the economy recover."

For the first time in almost three years, Florida's existing home sales rose in September - up 24 percent from last year, according to the Florida Association of Realtors (FAR).

A total of 10,817 existing homes sold statewide last month, up 24 percent over the 8,725 homes sold in September 2007.

"This is a clear sign that the significant price declines that have occurred across the state are leading to a more rapid absorption of the housing inventory," said Sean Snaith, economist and director of the University of Central Florida Institute for Economic Competitiveness.

Florida's median sales price for existing homes in September was $175,100. A year ago, it was $224,700, a 22 percent decrease.

Home Permits Continue Decline

New home construction in Hernando County is not faring as well.

The county building department issued only 28 single-family home permits in September, compared with 54 in September 2007.

From January through September 2008, the county issued 294 permits, down from 807 during that same time frame in 2007.

"New home construction is nil," said Joe Mazzuco Sr., owner of Royal Coachman Homes. "There's nobody even coming in the doors."

Builders, he said, are surviving right now on room additions and home renovations. And, like others, Mazzuco has been forced to lay off most of his staff. He has only part-timers right now.

Mazzuco said he builds in Hernando, Pasco and Citrus counties and the story is the same: people who are in a position to buy are opting for existing homes.

"We can't compete with these houses that have lost 30 percent of their value," he said.

Mazzuco said new homebuilding won't pick up until the existing housing stock goes down. And there are signs that's happening, he said.

He said it might happen even more after the election when people might have more confidence in the economy and those stimulus checks politicians have promised start arriving in mailboxes.

Mazzuco's comments are echoed by David Seiders, chief economist with the National Association of Home Builders.

"Without question, an additional economic stimulus package - including substantial measures to spur home buying and limit foreclosures - is necessary to support home prices, stabilize financial markets and limit the severity of recession," Seiders said.

Bob Eaton, president-owner of Artistic Homes, said he is sensing some pent-up demand out there for new homes, judging by increased traffic and phone calls to his model center.

"This is three years since demand started falling off," Eaton said. "So yeah, I'm hopeful things are going to start picking up some."