Fewer new Tampa homeowners upside down on mortgages
The "negative equity" situation remains rancid in the Tampa Bay area. According to Zillow, the online real estate service, a typical homeowner here owed $12,000 more than his home was worth in 2007.
But I see a little glimmer of hope in the latest negative equity numbers for the first three months of 2008. Of the homes bought at the start of this year, people have positive equity. It's the first time this has happened across the board since the summer of 2005.
Look at this chart supplied by Zillow (Note the return of "green" territory on the extreme right side of the graph):
I can think of several reasons why people are less indebted: Banks are demanding buyers put down larger down payments and are offering fewer funny-money negative amortization loans.
More encouragingly, people are getting better deals on the homes they're buying. They're paying real market value. They're not being gouged as buyers were in 2006.
(Un)Real Estate offers a peek at the housing market usually reserved for insiders. While it focuses on the Tampa Bay area, it won't neglect dipping
into the rest of Florida and beyond. Its goal? Simple: To help you keep a roof over your head without losing your shirt.
We believe Zillow?
Posted by: alex | May 06, 2008 at 01:52 PM
Zillow is poor on a home to home basis. But its broad brush stats seem to be more reliable since they approximate what you read elsewhere.
Posted by: James Thorner | May 06, 2008 at 02:08 PM
They're paying real market value.
I do not think we have come close to real market value based on prices that keep falling month after month with no bottom in sight.
In my opinion, real market value is when a properties value is in-line with the long term growth trends to which the Tampa Bay area has not reached to date.
Posted by: Fuzzy Bear | May 06, 2008 at 02:48 PM
It must be awful to be a lifelong renter. At least one can sit there and remind themselves how smart they are as they throw away $168,000 on rent in 10 years and wait for the out-of-state landlord to fix all the broken items in their rental "home."
Posted by: Ron Rentschler | May 06, 2008 at 07:01 PM
Zillow will face credibility issues for many years to come, just like Wikipedia. With what information it has to put into the logarithm, Zillow does a decent job. There are simply too many varibles for Z to accurately price a home, however. Only a person on the ground is truly qualified.
The stat you provided would seem to point to less foreclosures on the horizon. Since people are paying more realistic values, affordability increases. If the stat is accurate, it's encouraging.
Posted by: k | May 07, 2008 at 10:51 AM
Zillow values the property based on what the County Property Appraiser claims is the market value. Most County Property Appraisers (Pinellas especially) have yet to adjust for the down market. So the values Zillow is claiming are way off base. I would gladly sell my house today if I could get what the County Property Appraiser claims is market value...and be ecstatic!!!
Posted by: | May 07, 2008 at 11:48 AM
That's a very nice chart - 2 things needs to be overlayed:
1. # of months of inventory on the market
2. % of population that can afford the median home price.
#1 is at or near an all-time high (still subject to number-cooking by GTAR & siblings)
#2 is slowing increasing, but coming off an all-time low.
Cheers!
Posted by: Florida - Paradise Lost | May 08, 2008 at 10:41 AM