Most of our previous posts for some time now have focused on all of the good news associated with the South Florida real estate market. Home values have been rising consistently, residential development is firmly underway and residential property in the area seems like it has never been hotter. However, many of our previous posts have also commented on the possibility of the housing recovery picking up too much steam, leading to more problems in the future - possibly the near-future. A recent article in the Sun Sentinel sounded those same alarm bells.
According to the article, the double-digit increases in home prices - over 20 percent in both Palm Beach and Broward counties when January of 2012 prices are compared to January of 2011 prices - may seem like good news, but there are rumblings that the improvement is too much, too fast. Some rumblings even go so far as to use the ominous "bubble" term.
South Florida counties are seeing something that most counties throughout the country haven't seen in years: bidding wars. When multiple buyers are interested in the same property, these bidding wars can have a substantial impact on the actual final selling price. Investors, foreign buyers and current South Florida residents can sometimes lock horns in an attempt to secure a prime piece of property.
Another problem: prices aren't rising because buyers have more money to spend. According to the recent article median incomes in the South Florida region are actually dropping - figures reported by the Census Bureau.
Buying and selling property has always held the possibility of being complicated. But it appears the local area may be seeing more complications than ever. Contract terms, issues with real estate agreements, title issues and lack of disclosure concerns could all derail a sale at a real estate closing session. Going into the process with the best information about the available options can be the key to getting the right deal.
Source: SunSentinel.com, "Fast-rising home prices stir fears of another bubble," Paul Owers, March 3, 2013