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Monday, June 1, 2009

Key West Bottom Feeders - Part Two

A year ago today I wrote about the month ending May 31, 2008. CLICK HERE to see what I wrote then in full. Everybody in town continues to be an expert on the state of Key West real estate sales and our local economy. I still use this blog to lure new buyers. And I still don't associate with Realtors during my time away from work.

There were 7 single family homes sales in all of Key West during the month of May 2009. Two were short sales and one was a bank owned property at 910 United Street. I showed that house at least a dozen times. That place had huge locational and structural issues in my opinion. The house was sagging terribly on one side and had the misfortune of having one hell of a tree in the yard which may prevent any owner from ever putting in a pool to take advantage of the otherwise enormous lot. Oh, it's on a busy street to boot. It sold for $488,000 or $221 per sq ft. Another house located at 1300 Seminary Street (originally priced $1,869,000 in 2005 and sporadically reduced) sold for $1,035,000 (or $524 per sq ft)after just 27 days on the market when it was offered at $1,188,000.

The least expensive house to sell went for $270,000. The most expensive maxed out at only $1,100,000. (I had a buyer that submitted a higher all cash offer on that place last fall. The Seller should have taken the bird in the hand offer rather than wait for more money. I remember an email I sent to the listing Realtor warning about the cost of holding that property [monthly mortgage payments, utilities, pool maintenance, etc. which I estimated to be around $7000 per month]. My buyer bought something else in a better location at a better price.) The average price per sq ft on single family homes in all of Key West in May was $370. But readers need to be aware of the marked disparity of properties and locations. That price per sq ft is not proof of anything.

There were 14 condo and townhome sales during May. Two of those were shown as short sales. But 7 were bank owned properties. None of the remaining 5 sales was anything to write home about. So at least 64% of the sales that closed were problem properties. The least expensive unit sold for $110,250 and the most expensive only sold for $405,000. The average price per sq ft for units sold was a mere $261.

Here is some food for thoughtfor you bottom feeders: there are 110 properties single family properties shown as contingent or contract pending. Ten of the properties are already bank owned. Sixty-five of the houses are officially designated as short sales. Ten that I counted are bank owned. That means at least 68% of the single family homes in Key West currently under contact are distress sales. The positive spin on that number is that 110 properties are under contract. Not all will close. But I have to think a great number will. Consider the alternative. Is Countrywide or any other big lender prepared to own that many houses in Key West to get a better deal? The short sale contract between the short sale owner and the short sale buyer may not get accepted by the short sale lender, but I cannot accept the big national lenders wanting to absorb more bank owned properties.

There are 104 condos and townhomes shown as contingent or contract pending. Fifteen of those are already bank owned and 70 are designated as short sales. That means 82% of the condos and townhomes are officially distress properties. But there is some good news about a couple of the contingent properties. Two luxury units at Harbour Place went under contract in May, and neither is a distress sale. There is also a unit with a full transient rental license at Beach Club under contract, and it is not a distress sale either.

We are working our way through the inventory of available homes, condos and townhomes. The inventory is shrinking. I can't definitively state we are at the bottom of the downturn, but we must be pretty close.

If you want to buy your place in Paradise before the big one eludes you forever, CLICK HERE to search the Key West Association of Realtors mls database. Nobody will track your movement on the Internet and your personal information will not be collected by me. If you see a property that interests you, please call me, Gary Thomas, 305.766.2642 or e-mail me at I am a full time Realtor at Preferred Properties Coastal Realty Inc. Our office is an affiliate of Christies Great Estates.

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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.