FREQUENTLY ASKED QUESTIONS

The Bay County Association of Realtors® (BCAR) continually monitors many factors in Bay County which impact home buying. These include:

* Continuing influx of people to Florida and Panama City–especially Baby Boomers.

* Interest rates, now near historic lows, and Job growth, which remains steady and strong.

* Local economy, which remains robust, with low unemployment, and an Inventory of homes, which is abundant and high-quality.

* The sustainable pace of sales and stabilization of pending sales, a sign of normalcy returning.

*The cyclical nature of the real estate industry, with peaks and valleys, but historically always a positive, appreciating investment in the long term.

All these factors, and more, indicate that now is a good time to buy in Panama City.

Q. The general attitude of home buyers in the past year has been to “wait and see” how low home prices may fall.  Why does BCAR feel positive looking forward in 2008-09?

A. Between 2004 and 2005, home prices in Panama City increased by more than 40 percent.  With double digit increases in nearly every quarter, bargains in Panama City real estate were few and far between.  During 2006, and into 2007, most serious sellers seem more flexible on price and are offering a variety of incentives to buyers.  Now in 2008, and looking into 2009, there are incredible values currently on the market.

Because of the cyclical nature of real estate, it is unlikely that the current situation will remain for long.  Home prices will begin to rise again.  National Association of Realtors research released in January shows home prices have generally bottomed out, and only a few local markets will see limited price declines.  Pending home sales are up nationally, and took a turn upward in November for the Bay County MLS.  This is an indication that buyers are returning to the market, and 2008-09 represents an opportunity to buy before property appreciation begins to accelerate once again.

Q. What evidence does BCAR have that illustrates an upward movement?

A. There are recent market indicators that perhaps home prices have begun leveling off.  We find home sellers are becoming more flexible in their negotiations with buyers.

For example:

* March/April pending sales figures are encouraging.

* The median price for a single-family home stood at $342,000  through November 30, 2006—a drop of only 2.2 percent from the 2005 year-to-date figure of $350,000.

* The median condominium sale price at that same time was at $301,225 - an increase of more than 2 percent from the 2005 median price year-to-date of $295,000.

* The 2006 market closely resembled the 2001-2002 market-  the “normal market prior to the 2003-2005 boom years” and 2007 looks even better.

Q. What is BCAR actively doing to combat the escalating concerns and stress of home buyers over the spiraling costs of property insurance in Bay County and across the state?

A. BCAR communicates with the Florida Association of Realtors® and the National Association of Realtors® concerning the property insurance crisis.  Several task forces have produced studies which have explained the issue, and defined potential solutions to help alleviate the problem. These were all addressed at the Florida Legislative Special Session in mid-January and continue to be addressed.

Q. Does BCAR believe the high cost of property insurance is contributing significantly to the sluggish home sales and keeping buyers on the sidelines?

A. According to experts, the skyrocketing cost of property insurance, fueled by an historic and unprecedented period of hurricane activity in 2004 and 2005, has been one of the primary factors behind the downturn in sales.  While there are other factors, including the three years of historic property appreciation, this one issue has put the biggest damper on sales. Once the issue is resolved, this should help in the market’s return to normalcy.

Q. Why has BCAR chosen to launch a Public Awareness Campaign?

A. This campaign is intended to build awareness and improve perception among home buyers that the time is right to purchase a home in Panama City.  We hope to generate a positive attitude among residents and seasonal visitors to Panama City.  Our community’s many incredible amenities provide a great place to live and purchase a home.  Economic forecasts suggest the recent real estate market correction is coming to an end, and is probably over, and this offers consumers a potentially once-in-a-lifetime opportunity to purchase a home at these prices.

Q. Was there a “bubble” in the real estate market, and has it burst?

A. BCAR doesn’t buy the popular notion of a real estate “bubble”– which has been equated to the actual dot com “bubble” of 1999 and 2000.  The fact is that real estate is historically a safe haven for both investment purposes and for family financial security.  While property values can and do fluctuate in the short term, over the long term real estate appreciates and grows in value.  Median existing home sale prices in the United States have increased an average 6.5 percent each year from 1972 through 2005, and 88.5 percent over the last 10 years combined.

While there is no question that the local market saw historic appreciation rates during the 2003-2005 period, this represented a “boom” in prices, and the median sale prices have since leveled off.  Unlike the dot com “bubble,” which saw the stock market lose almost half its value and the NASDAQ drop by 80 percent, property prices will not drop to pre-boom levels.  In fact, prices have dropped only slightly, and are expected to return to the traditional, normal appreciation rates of the past.

Q. Will the recent “boom” cycle cause any lingering concerns among potential buyers hoping to “time” the market turn and wait for the low point to be reached?

A. The 2003-2005 real estate cycle was so short and intense, many buyers took a “wait and see” attitude in 2006.  But now, in 2007, with the return to normalcy, buyers should recognize there could be a missed opportunity if they don’t act now.  Trying to “time” a real estate market is a difficult task of prognostication, and one at which few people succeed.  Becoming educated about the long term realities of the overall market, and the Panama City market in particular, should alleviate most concerns.

Panama City is a destination city, for both retirees and families, for many reasons. Panama City offers an unsurpassed climate, a beautiful coastal environment, rich cultural heritage and amenities, numerous recreational offerings (golf, boating, biking, fishing, etc.), great shopping, a strong business community, a tremendous educational system, and much, much more.

The local real estate community is sold on Panama City– that’s why our members have decided to live and work here.  We believe in our community, and want to share it with others.  And we know Panama City has so much to offer, it sells itself.  The incredible variety of quality homes and condominiums available in the current market gives potential buyers the perfect opportunity to grab their dream home now.

Q. What should potential buyers do in response to your campaign?

A. Don’t miss this unique opportunity to find a home in Panama City!  We strongly recommend contacting a local Realtor® to handle your real estate transaction.  You can do so by visiting www.panamacitymls.com.

Why? For the following reasons:

* Realtors® are partners with their clients, helping make the biggest investment of their life easier.

* Realtors® take care of the many details associated with buying or selling a home.

* Realtors® are a good resource for information in preparing to purchase a property.

* Realtors® are a good source of knowledge about financing, inspections, and other services related to the home buying and selling process.

For more information, contact:

Eleanor Burross, Association Executive

Bay County Association of REALTORS®
850-763-8078
exec@bayflrealtor.net