I have a few Realtor friends in Florida that I chat with regularly. They've all commented that the market there has picked up big time over the past few months, primarily with snow bound northern bargain hunters trolling for super deals amidst the foreclosure rubble of the Sunshine State.
Then last week I read this article from CNN Money, Duck! Watch Out for Falling Home Prices. The article is a lot of the same old same old, about the upcoming pull back in government support and the number of properties in foreclosure, or coming into foreclosure. But the shocker (from Moody's) is in the 4th to last paragraph:
"The worst performing market will be Miami, Fla. Moody's projects prices there to drop a heart-stopping 29.2% by Sept. 30. That follows a 47.7% decline the metro area recorded in the past three years. Grand total: 64% drop."
I knew there were deals in Florida, driven by foreclosures and investor pull outs, but that 64% top to trough drop number for Miami blew me away. (I'm already anticipating comments to this post like "Wait, Sullivan, your turn is next." But Florida has a different set of circumstances, namely speculative overbuilding, and a huge inventory of properties that investors picked up in hopes of flipping and are now walking away from.)
So how does this relate to Sullivan County? The second home market here has two components. One is died-in-the-wool country-ites from the city with dreams of having an organic garden, or fly fishing, or whatever within a couple of hours of NYC. Florida has no attraction to them whatsoever, regardless of the bargains. They want a two hour drive away retreat to pursue their country passions.
But there is another part of our second home market that is less country-committed. Their second home interests are more free ranging. A place in the country a couple of hours from NYC would be nice, but so would a place in the sun in Florida, a couple of flight hours away. Add in the prospect of picking up a super deal with the cherry on top of potential appreciation, and the scales can tip to Florida.
I've spoken with a number of potential buyers who've been kicking around in the Catskills, but also making hunting trips to Florida. (Given the winter we've had, it doesn't take a lot to come up with an excuse to head south!) And in the past month, when I've been with friends in the city and the topic has turned to real estate (which, inevitably, in New York City, it does), there's been a lot of chatter about Florida. I don't have any way to measure this, but at the moment, I think that Florida is formidable competitor for the second home dollars of some New Yorkers.