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Friday, May 2, 2008

April 2008 Real Estate Sales Report for Key West

There were 23 single family homes that sold in April 2008 for a total of $16,442,000. The one an only short sale was at 1119 Oliva Street that I reported earlier this week. But there were three bank foreclosures that sold. All three sold for about one half of the original mortgage amount. Interesting!

Eleven condos and town homes sold during the same time period with sales totaling $7,612,900. Two of those were bank foreclosures, and both were at 1800 Atlantic Condominiums. The same bank that foreclosed on one unit financed the repurchase by a new buyer. (It was my customer and he got a great deal.)

There are a total of 59 homes, condos and town homes currently listed as contingent or pending. That means there are binding contracts between seller and buyer that may either have some condition that needs to be satisfied or that is just waiting to close. Interestingly, 46 of the properties are listed as contingent/continue to show or contingent/kick out. The Key West Association of Realtors requires that property listings be changed from "active" to "contingent" once a short sale contract has been accepted by the seller and is pending approval by a lender. It looks to me like a significant number of the contingent sales are short sales awaiting lender approval.

Our mls system does not automatically sort short sale or bank foreclosure listings. So it is necessary for a Realtor to make a search of all listings for language that denotes short sale or bank foreclosure. And some Realtors are entering erroneous information into the mls database. So our database is not exactly 100% correct. We did a manual search of the 1154 active residential listings and of those about 250 are listed as short sales. That is scary.

There are way too many properties on the market right now. Many of the pre-foreclosure properties are condos or town homes and are being listed as short sales. Many of those properties were purchased in the past three or four years and most of those were purchased with little or no money down. That means the "owner" has no money invested and no commitment to the property. Many of those same properties have declined in value and are not worth what they owe. It is no wonder that owners are walking away. That exodus is driving down the value of other similar units. Home owners who purchased their properties years earlier are unaffected by the price decline as long as their basis is at par with the current market value. They just missed the opportunity to gain from the huge price increases that occurred prior to the bubble burst.

I think we will see continued downward movement on prices overall until the remaining homes condos - town homes are foreclosed upon. I know there are many more properties that will be foreclosed upon and I anticipate more downward pressure on prices as a result.

The banks are keenly aware of what is transpiring. They are playing a numbers game. They do not have an emotional tie to their real estate assets. Their only commitment to Key West is that they either own or will potentially own a foreclosed home or condo. The goal of the banks is to recover as much on the sale of their assets as quickly as possible. That is is. A good Realtor can help a buyer find a short sale or bank foreclosure and turn a bad deal into a good deal. Not all short sale properties are good deals. And certainly not all foreclosures are good deals. Low price does not equate in any way to some piece of real estate being a "deal".

I still think that there are some very good buying opportunities in Key West, especially in the Old Town area, Casa Marina, and Meadows areas. The topsy-turvy market is driving down the asking prices of properties that are not under distress. And that creates opportunities for prospective buyers. If you are interested in buying a home or condo in Key West please consider calling me, Gary Thomas, 305-766-2642 or e-mail me at

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Gary Thomas in a Nutshell

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Key West, Florida, United States
I first read about Key West in a magazine called "After Dark" sometime in the mid 1970's. But it wasn't until March 1984 that I made my first visit to the island that would become my home. I had two weeks for a vacation and reserved a room at Colours Guesthouse (now Marrero's Guest House) for one week. I thought that if I didn't like Key West, I could always go back to Miami or Ft. Lauderdale for the rest of my trip. But after a couple of days in Key West, that was no longer a consideration. But when I wanted to extend my stay for the extra week I found there was no room at the inn. The guesthouse owner did find me a room at LaTeDa, the infamous guesthouse/restaurant. That's a story I'll write another day. But those two weeks in Key West gave me the realization that I had found Paradise. Key West has been my home since 1993 and my only regret is that it took me so long to get here. I am a full time Realtor at Preferred Properties CRI. Let me help you find your new home or business in Paradise. Living in Paradise is not a slogan, it's a way of life.