It doesn’t have four letters, but “mortgage” has definitely been a dirty word in the financial world the past few years. That’s especially true when the word “mortgage” is paired up with such other terms as “subprime,” “delinquent,” and “foreclosures.”

Little wonder that mortgages - along with the derivative securities backed by them and the often-unseemly practices of the people pushing them - have gotten much of the blame for precipitating the economic meltdown from which the American economy is now struggling to recover.

There’s still plenty of woe in the mortgage world. But in recent months there have also been some signs that the real-estate-financing markets are at least regaining some semblance of stability, with foundations being poured for a rebuilding phase that might not be too far down the road.

So far, the most promising sign of this hoped-for mortgage-market rebound has been a late-February report from the Mortgage Bankers Association (MBA), the mortgage-lending industry’s leading trade group. The recently released report shows that delinquencies on existing first mortgages for residential properties with one to four living units - we’re talking about roughly 44.4 million loans - declined in the 2009 fourth quarter.

The MBA’s National Delinquency Survey found that late payments on these loans fell to a seasonally adjusted rate of 9.47% of all mortgage loans during the final three months of last year. That’s down from 9.64% at the end of the third quarter. But it was still well above the 7.88% level from the fourth quarter in 2008, the MBA reported.

Although the decline from the third to the fourth quarter of last year was small, it still represented the first quarter-over-quarter decrease in the number of loans potentially headed for foreclosure since mid-2006. Mid-2006 was when the rate of late payments began to rise. The rate began to increase steadily until early 2007, when a massive spike in subprime-mortgage defaults caused the late-payment rates to escalate to unprecedented levels.

The ensuing collapse of housing prices - particularly in overbuilt areas like California, Nevada and Florida - and the country’s subsequent plunge into recession, which pushed unemployment rates into double-digit territory, left an even-larger number of U.S. homeowners unable to meet their monthly obligations.

Peeling Back the Layers

MBA Chief Economist Jay Brinkmann said the positive nature of the figures was bolstered by a similar drop - from 3.79% to 3.63% - in the number of borrowers who had missed only one monthly payment. Brinkmann said that was significant for two reasons:

• First, this latest development counters the historical trend for the fourth quarter, when short-term mortgage delinquencies normally rise due to holiday spending, higher heating costs and other seasonal factors.
• Second, it means the rise in short-term delinquencies stopped short of the record levels set in 1985.

The drop in 30-day delinquencies is doubly important, Brinkmann added, because those late payments have historically been a leading indicator of foreclosure actions.

“With fewer new loans going bad, the pool of seriously delinquent loans and foreclosures will eventually begin to shrink,” Brinkman said. “It also gives us growing confidence that the size of the problem now is about as bad as it will get.”

Of course, the size of the foreclosure problem remains at record levels nationwide - and is far worse in some of the hardest-hit areas.

Across the United States, the percentage of mortgages in some stage of the foreclosure process rose to 4.58% at the end of 2009, up from 4.47% in September and 3.30% at the end of 2009. In Florida, however, 20.4% of all mortgages are either 90 days or more past due - or are already in foreclosure. Nevada is a close second: A total of 19% of its loans are either three months or more in arrears, or are now in full-blown foreclosure. Even worse, the number of subprime mortgages in foreclosure nationwide stands at 15.58%, up from 15.35% in September.

However, even in the foreclosure category, the MBA found some positive signs in the fourth quarter.

The number of loans on which new foreclosure actions were started fell to 1.20%, down from 1.42% in September and up just 12 basis points from year-end 2008. Foreclosure starts on subprime loans also decreased slightly, dropping from 3.76% in the third quarter to 3.66% in the fourth quarter.

Not everyone agreed with the MBA’s somewhat upbeat view of the foreclosure numbers. A MarketWatch commentary on the delinquency report noted that a moratorium on foreclosures had been imposed by lenders and loan regulators in many areas of the country - a restriction that could be merely delaying new foreclosure actions rather than eliminating the need for them.

In his commentary, MarketWatch Assistant Managing Editor Steve Kerch noted that many mortgage lenders are already holding large inventories of foreclosed properties and might not want to add to the list until real-estate sales actually pick up from current levels.

Ineffective Assistance Programs?

Another factor at play was the Obama administration’s increased emphasis late last year on its Home Affordable Modification Program (HAMP), designed to help 3 million to 4 million borrowers restructure their mortgages to avoid foreclosure. That could have helped stall new fourth-quarter-foreclosure actions and undoubtedly contributed to the improved MBA numbers, although the actual impact of the HAMP program still isn’t clear.

The public-interest news organization, ProPublica, reports that only about 1.0 million homeowners have been put into the program since it started in April 2009. And only about 116,300 have received permanent loan modifications, while roughly 62,000 have already been dropped from the program for various reasons, such as failing to make their payments even after those payments were reduced.

The remainder of the 1 million participants are still in the so-called “trial period,” which was supposed to last a maximum of three months. However, ProPublica says 475,000 have been in trial periods for longer than three months, and 97,000 have been stuck in loan-modification limbo for more than six months, with almost 60,000 of those having mortgages handled by Chase Home Finance, a subsidiary of JPMorgan Chase & Co. (NYSE: JPM).

The lengthy trial periods could have a negative long-term impact on troubled homeowners, since the reduced payments result in an increased balance on their mortgages, hurting the credit scores of the affected borrowers and leaving them with fewer alternatives if the modification ultimately falls through.

The low success rate and slow progress of the loan-modification programs also means that actual foreclosure rates could still spike higher, especially given the fact that very few of the people in trouble with their mortgages because of unemployment have been able to find new jobs - and more are still losing them, as evidenced by the rise in new weekly claims for jobless benefits in eight of the first 10 reporting periods in 2010.

The jobs situation also helps explain why about 275,000 homeowners in loan-modification trial periods are already delinquent on their payments, according to the U.S. Treasury Department, which monitors HAMP.

The housing market itself has been adding to the confusion with respect to mortgages. After rising nicely during the final quarter of 2009 - thanks in large part to a pair of government homebuyer tax-credit programs - sales of existing U.S. homes unexpectedly dropped in January.

The National Association of Realtors (NAR) reported that sales in the first month of 2010 fell 7.2% to an annual rate of 5.05 million units, down sharply from the predicted rate of 5.50 million homes - though that still represented an increase of 11.5% from January 2009. December sales were also revised downward slightly - from an annualized pace of 5.45 million to a projected 5.44 million units.

The impact of the waning federal tax credits on January sales was reflected in another NAR report. Purchases by first-time homebuyers using the credit - which was subjected to income limits in November - fell by 3.0% in January. The tax credits are scheduled to expire at the end of April.

By contrast, the report said January purchases by investors who were looking to take advantage of foreclosure bargains rose by 2.0% from December to January.

That surge in investor buying was particularly evident in some of the nation’s harder-hit regions, such as the Las Vegas area, where the research firm MDA DataQuick reported that 43% of all January home purchases were made by investors or second-home buyers, who paid a median price of $101,000 for their homes, down from $109,836 in December and $125,000 in January 2009.

However, the impact of that buying on the Vegas mortgage market was less pronounced since MDA also told the Las Vegas Sun that a full 50% of January home purchases were all-cash deals, up from 39% in January 2009.

That situation prompted first-time homebuyer Chris Iuso - who’s pre-qualified for a loan and looking to purchase a Las Vegas foreclosure property for as much as $120,000 - to complain to a Wall Street Journal reporter that, in spite of Nevada’s No. 2 national ranking in mortgages in foreclosure, “there really isn’t much inventory (of foreclosed houses) to chase.”

Even worse, the bit of housing that is out there and available typically sells for cash on the barrel - putting it out of reach of the typical prospective homeowner. Iuso’s agent, Bryan Mitchell of Re/Max Associates, told The Journal that some bank-owned homes have attracted more than 20 offers within just a few days.

Of course, one reason cash is suddenly king in severely depressed markets is that lenders remain reluctant to make new real estate loans - for a variety of reasons. Those reasons include:

• Jobless rates, which remain stubbornly high, and which are actually still climbing in such geographic areas as Las Vegas.
• Low rates on fixed-rate loans - too low, in fact, for lenders to willingly take on the uncertainty of long-term loans.
• High exposure to increasingly delinquent commercial-property/commercial-real-estate (CRE) loans, which could be the focus of the next banking crisis.
• And still-declining property values, which could put even more homeowners “under water,” meaning they owe more on their loans than their houses are worth.

Still-falling average home prices were confirmed by the S&P/Case-Shiller U.S. National Home Price Index, which recorded a 2.5% decline in the fourth quarter of 2009 versus the fourth quarter of 2008. There is a bright spot, however: That’s a major improvement over the annualized rates reported in the first three quarters of 2009, when there were reported price drops of 19.0%, 14.7% and 8.7%, respectively speaking.

In the nation’s 20 leading metropolitan areas, which are surveyed monthly, the drop in average prices for December was 3.1%.

The One Place to Profit From the Mortgage Malaise

The continued decline in home prices was the major underlying reason the late-February report by real estate researcher FirstAmerican CoreLogic concluded that 11.3 million U.S. homeowners - nearly 25% of all residential-mortgage holders - owe more on their loans than their houses are worth. The report said that 620,000 new homeowners went under water in the fourth quarter, while another 2.3 million are living on the razor’s edge - with less than 5% equity in their homes.

What does this all add up to for investors? The mortgage markets may be stabilizing, but uncertainty remains far too high to generate many outstanding profit opportunities in this harried market sector.

But there may be one exception: The mortgage insurance market.

The mortgage market remains a turbulent one. Property values remain questionable in many markets. And because of a “jobless recovery” and shaky employment outlook, even a borrower with a pristine credit score may end up in a financial jackpot with the loss of paycheck that’s necessary to keep making mortgage payments. With such a dour outlook, you can bet that every lender will insist on mortgage insurance before making any new loan. That, coupled with even a modest decline in new delinquencies and foreclosures, could help out the insurers - and their stock prices.

Proof of that came late last month when Radian Group Inc. (NYSE: RDN) reported a smaller-than-expected quarterly loss - $1.12 versus a predicted $1.69 - based on a slowing in the rate of fresh delinquencies and increased liquidity to cover claims, a condition it expects to maintain through 2012.

Radian’s shares rose $1.25 each, or 14.59%, to $9.83 on the news, and eclipsed the $10 level this week. Other firms in the sector - most of which will be reporting earnings in the next couple of weeks - also rose in price on Radian’s coattails. Among the ones that could be worth a look, with closing prices from yesterday, are:

* The PMI Group Inc. (NYSE: PMI) - $2.80.
* MGIC Investment Corp. (NYSE: MTG) - $8.00.
* MBIA Inc. (NYSE: MBI) - $5.05.

But given all the uncertainty in the mortgage market right now, make sure to investigate these companies carefully before purchasing their shares.

This article has been republished from Money Morning.

Sharon J Kelly can help you avoid the consequences of losing your home or walking away. This article sheds some light onour current crisis that we are facing.

If you listen to media coverage about the current housing and mortgage crisis, you are likely to hear tales about people who are walking away from their mortgages when they find themselves owing more on their homes than their homes are worth.

The stories range from people leaving their homes and simply mailing their keys to the bank, to those engaging in something called “buy and bail.” “Buy and bail” is a scheme where homeowners apply for mortgages claiming that the rental income on their current home will cover a new home’s mortgage payments. They then buy a second, often nicer, home and walk away from the first home and its existing mortgage, never renting it out as promised. They then allow the bank to take possession of their first home. The new mortgage is much cheaper since housing prices and interest rates are lower.

If walking away sounds easy, it’s not. These practices have hard consequences, including future credit problems, tax penalties and possible jail time, since some of these methods are considered mortgage fraud. Some banks have even begun suing the borrowers for personal assets.

But, these stories may represent the distinct minority of walk-aways. Some housing experts are claiming that true walk-aways are rare and in some communities, like the Twin Cities, nearly unheard of. Kurt Eggert, a professor of law at California’s Chapman University Law School and an expert on predatory lending,

said he thinks that mortgage bankers are trying to shift the blame for the foreclosure crisis to borrowers, with tales of cheating homeowners and innocent lenders.

“Lenders have an interest in painting themselves as responsible, even caring entities,” he said. “They want to cast blame for the sub-prime meltdown and make themselves seem like the victim of borrowers in order to fight off additional regulations.”

Eggert insists that the banks are trying to demonize people who can no longer afford their mortgages. “In the world of high finance, people who take loans to buy high-rise office buildings walk away from them all the time,” he said. “Why the double standard? Because the financial industry is trying to claim that they are the victims.”

In fact, many of the walk-aways are actually investor owned, not owner occupied. A report by Fitch Inc., a financial rating company, found that 66 percent of the delinquencies during 2006 and 2007 were sub-prime mortgages from “those engaged in mortgage fraud for the purpose of property speculation,” that is, investors who fraudulently bought homes not to live in, but to sell at a profit when housing prices rose.

In some states like Nevada, Arizona, Ohio and Florida, during the third quarter of 2007, non-owner-occupied foreclosures represented 22 percent of all loans made, according to the Mortgage Banker’s Association. But banks continue to treat residential real estate investors the same as they do the people who are living in their homes and who want to stay there.

Mark Ireland, supervising attorney for the Foreclosure Relief Law Project in St. Paul who works locally to help homeowners avert foreclosure, has questions about the common perception that homeowners don’t act in good
faith with their banks.

“I never talked to anyone who called me to say they just want to leave the lender high and dry,” he said. “What I do see are homeowners who are incredibly frustrated. They want to modify their payment or lower their interest rate—they just want to do something. They may not be able to make the full payments but they want to make things work.”

But, said Ireland, when they contact their lender, they get the runaround and eventually they give up and let the bank foreclose. “They just want to get on with their lives. But, this idea of the greedy homeowner who has no morals or ethics, I don’t see that at all.”

It would be a good business decision, Ireland claims, for banks to start to give a little on the principal owed when homes are worth much less than the mortgage. Currently though, even the giant mortgage corporations Fannie Mae and Freddie Mac both forbid their lenders to do this. (including properties of one to four units) rose to a seasonally adjusted rate of 9.64 percent, up from 6.99 percent from a year earlier. Of these, 33 percent were prime fixed-rate loans. The situation is not expected to change until employment figures improve.

Courtesy of Stephanie Fox

Call Sharon J Kelly today for help with your home! 1 800 778-8335

Florida Still Stays at Foreclosure Forefront

Mortgage Banker’s Association stated that Florida’s late payment numbers rose from 12.18% to 12.66% during the 3rd quarter of last year. By the end of last year, the national average of mortgages in foreclosure was 4.58%, while Florida was able to claim the unfortunate distinction of a 13.44% foreclosure rate.

Nevada, which has also seen its real estate fortunes tumble precipitously, and is ranked number 2 in foreclosures nationally, averaged a 9.76% foreclosure rate. But, with Georgia ranked 3rd in delinquencies, the Southeast seems to have become the poster child for foreclosures.

Despite its delinquency rate, Georgia is one of the top HAMP performers, with more than 30,000 trial loan modifications as of January; more than 10% of those loans were modified permanently. The Department of the Treasury indicates that at least 1 million homeowners nationally have already begun to modify their home loans under the auspices of the HAMP program; however, just over 10% of that group have managed to get a modification. Many have criticized HAMP because it does very little for people who have lost their jobs or who owe more than their home is currently worth.

Across the nation, the rate of delinquent payers fell slightly to a rate of 9.47% at the end of the 4th quarter. While this is down 17 basis points from the 3rd quarter rate, it is still 1.5% higher than it was at the end of 2008. The Atlanta Business Chronicle suggests that the drop in delinquencies that appeared at the end of 2009 may be a sign that the mortgage crisis is coming to an end.

A number of economists, according to the Wall Street Journal, disagree with that theory. They feel that as long as unemployment rates remain above 10%, foreclosures will keep pace with that rate or will trend higher for the foreseeable future.

They reason that if people are not earning a salary, or are working only part time and making a fraction of what they used to earn, they will be hard pressed to pay their bills, especially a mortgage on a home that has declined so sharply in price that it is worth far less than the owner paid for it in the first place.

Florida’s foreclosure rates, based on the immense job losses we have recorded over the last 2 years, and the current 12.2% unemployment rate, seem to attest to the more pessimistic point of view.

Written by Marc Jablon

AP

President Obama is unveiling $1.5 billion in housing help, a boost timed to his appearance in the city with the worst foreclosure crisis in the nation.

In Martin County, at least, the sales trends appear to have continued upward.

Realtors sales in the Port St. Lucie Metropolitan Statistical Area, which encompasses both counties, increased 51 percent over the same period of 2008, data from Florida Realtors shows.

Indian River County sales were up 63 percent in the same comparison, data from the county Realtors Association reported.

Statewide, sales of existing single-family homes rose 44 percent. It marks the sixth consecutive quarter that Florida has seen higher existing year-to-year home sales.

“The sales volume shows that many buyers are taking advantage of the low interest rates, which are currently around 4 percent, the bargain prices for homes and the First Time Home Buyer Tax Incentive,” Maria Wells, president of the Realtor Association of St. Lucie, said in an email.

Bonnie Peters, president of the Martin County Realtor Association, said sales were up 46 percent in January over the same month in 2009 in the Martin County Multiple Listing Service. Pending sales were up 72.6 percent for the month (504, compared with 292 pending in January 2009).

“We anticipate the trend to continue even as we face an increase in foreclosure listings during 2010,” Peters, managing broker of Prudential Florida Realty’s Stuart office, said in an e-mail.

Except for the Lakeland-Winter Haven MSA, all of the other 19 MSAs that Florida Realtors tracks in its report had increased sales of existing homes in the fourth quarter compared with the same period of 2008. All of the MSAs showed gains in condo sales. Indian River County is not in any of those MSAs.

The median price of the 1,689 homes sold in the Port St. Lucie MSA was $110,800, a drop of 16 percent from a year earlier. Statewide, the median price fell 13 percent.

The median is a typical market price where half the homes sold for more, half for less.

In the condominium market, sales in the Port St. Lucie MSA were up 82 percent, not quite as much as the 93 percent increase statewide. But the median price of the 82 condos sold in the local market dropped less than the statewide figure. Indian River County condo sales were up 131 percent in the same period.

This marks the fifth consecutive quarter for increased statewide sales in both the existing home and condo markets compared to year-ago levels.

“The condo market is staying stable with the same amount of sales as last month and year to date,” said Wells, who is broker-owner of the Lifestyle Realty Group

The University of Florida’s Bergstrom Center for Real Estate Studies conducts a quarterly survey of industry executives, market research economists, real estate scholars and other experts. The survey noted uncertainty over the tight credit market, foreclosures and the jobs outlook.

The survey also found that private investors – both foreign and domestic – are starting to “kick the tires” in many markets, said Timothy Becker, the center’s director. In addition, investor expectation for returns is starting to fall to more realistic levels, helping to close the spread between bidding and asking prices, he said.

“These developments bode well for the transaction market when quality properties start coming to the marketplace,” Becker added.

Courtesy of George Andreassi   TC Palm

FORT PIERCE — After setting a new record in 2008, lenders filed 1,246 fewer mortgage foreclosure cases in St. Lucie County last year and several county officials said they hope the downward trend continues, but can’t guarantee it.

A total of 8,324 mortgage foreclosure cases were filed in Circuit Court in St. Lucie County in 2009, a decline of 13 percent from the all-time high of 9,570 in 2008, court records show.

And the 507 foreclosure cases filed in January is the lowest number in more than two years, with the exception of April 2009 when a mandatory mediation program went into effect for foreclosure cases in the 19th Judicial Circuit.

“We’re hopefully trending downward,” said Joe Smith, the clerk of the circuit court in St. Lucie County, about the foreclosure numbers. “I hope the downward trend is a trend we’ll be able to report about all year.”

“I think that we’re like the stock market where past performance cannot predict future results but this January we had 507 foreclosures compared to 793 in 2009,” Smith said. “That is a significant decline.”

But Smith and several other economists and government officials said they do not think the foreclosure crisis is over because of the high number of cases. That means property values will continue to decline as lenders resell foreclosed residential and commercial buildings for lower prices and drive down the real estate market.

Meanwhile, Martin County set a new record for foreclosures in 2009 with 2,082 new cases, court records show. That represented a 19 percent increase compared to the previous record of 1,742 filed in 2008.

And lenders filed 2,459 mortgage foreclosure cases in Indian River County, a 1 percent decrease from the record 2,488 cases filed in 2008, court records show.

William Pittenger, a senior vice president and chief real estate economist for Seacoast National Bank, said high delinquency rates on mortgage payments combined with a backlog of foreclosure cases because the court system is so clogged leads him to believe the crisis will last until at least 2011, maybe longer.

“I do expect on the Treasure Coast … that foreclosures are going to stay elevated well into 2011 and perhaps into 2012,” Pittenger said. “We’re not going to get out of this very quick. The demand just isn’t there to make that happen.”

One reason for the persistence of the crisis is that interest rates are increasing on adjustable rate mortgages taken out on many properties bought when the real estate prices were going up, Pittenger said. That will result in higher monthly payments and make it harder for borrowers to repay their loans.

Another reason is some homeowners who bought at the height of the market are withholding payments from their lenders, even if they can afford to pay, because the amount they owe is so much greater than the current value of the property they don’t want to throw good money after bad, Pittenger said. That’s a change in philosophy from the past when it was considered shameful to walk away from a home.

“The social and moral barriers to foreclosure are just falling all around us,” Pittenger said. “People who you would never think would enter into foreclosure are doing it, just cutting their losses and running. They are thinking that, ‘I am never going to get out of this,’ and they’re probably right.”

The proliferation of foreclosed properties is driving down the value of St. Lucie County’s real estate, said county Property Appraiser Jeff Furst.

“How has it effected our property values? Well, it’s killing them,” First said. “The total collapse of the real estate market is a problem, but this foreclosure thing has driven it even deeper into disarray.”

“We’ve had some horrendous years,” Furst said about the foreclosure cases. “These are giant numbers. I suspect we peaked, but I also suspect there’s a lot of pain left and our numbers are so big that it’s a huge problem.”

The value of real estate declined last year by 25.6 percent in Port St. Lucie, 20.9 percent in St. Lucie County and 17.4 percent in Fort Pierce, county records show. In 2008, values went down by about 18 percent in Port St. Lucie, roughly 15 in St. Lucie County and 6.6 percent in Fort Pierce.

“It’s because we have this large inventory (of properties for sale) and we’ve had these huge amounts of properties sell off at very depressed prices,” Furst said.

But prices don’t seem to be going down as fast this year as in the past two years, Furst said.

“Even if … the market settles and it doesn’t go down, nobody thinks it’s going up,” Furst said. “There’s almost universal agreement that when it comes to real estate it’s going to … be this long, protracted not-going-anywhere deal.”

St. Lucie County Commissioner Charles Grande, a real estate broker, expressed similar sentiments.

“I wouldn’t celebrate on the foreclosure side yet,” Grande said. “I don’t think (the crisis) over. I don’t think it’s gotten worse. I think we’re kind of on a flat bottom.”

NUMBER OF FORECLOSURES IN ST. LUCIE COUNTY

2005: 485

2006: 1,327

2007: 4,873

2008: 9,570

2009: 8,324

By Jeremiah Jacobsen

Financially stressed homeowners left hanging while their banks consider whether to approve the short sales of their properties may benefit from new federal guidelines.

In a short sale, the homeowner sells the property for less than what is owed on the mortgage, and the lender forgives the difference.

While short sales are considered an ideal solution for banks and for “underwater” homeowners on the verge of foreclosure, the deals often drag on as lenders take weeks or months to decide what to do.

Local homes in st lucie county are prime for the investor as homes for sale are well below the average price. Here is an article that I would like to share with you about Florida’s Real Estate market and the comeback that is happening.

The Florida existing housing market made some sizeable leaps during the final month of 2009. According to tatistics released by Florida Realtors, December sales of existing single-family homes jumped 33 percent and condos, a whopping 91 percent.

“The market is on a comeback,” said Emerald Coast Association of Realtors (ECAR) President Mary Ann Windes. “That’s why ECAR’s theme for 2010 is ‘The future’s so bright, we gotta wear shades!’”

Locally, sales of existing single-family homes along the Emerald Coast were up 22 percent. Panama City also saw their numbers rise, albeit modestly at 2 percent, and Pensacola reported a small decline, dipping 2 points.

While most of the markets in Florida saw a decrease in the median sales price including Panama City and Pensacola at 9 and 8 percent, the Emerald Coast was one of only a handful to report an increase, up by 10 percent.

“We’ve been creeping along the bottom of the market for awhile now and we’re seeing a little upward movement in price. Even though we won’t know for sure until we’re well past it, we believe prices hit the bottom in 2009,” said Windes, broker-owner of Real Estate Professionals of Destin Inc.

“It’s too early to say that they’re rising,” she continued, “but I can tell you from personal experience that prices are getting competitive again.”

Condos remained a hot commodity in the chilly month of December, with sales of existing units soaring 91 percent, as compared to the previous year. The Emerald Coast bettered the state’s average, rising 135 points.  Panama City and Pensacola also saw gains, each rising 42 and 70 percent respectively.

Although the median sales price dipped in nearly all Florida markets, gains were reported in three areas, including Pensacola, up 28 percent. While the Emerald Coast and Panama City Beach reported decreases in median sales prices of 8 and 10 percent, both areas skirted under the state’s average drop of 18 percent.

“With the number of buyers increasing in the market, sellers don’t have to reduce their prices to compete, and this seems to be stabilizing prices,” Windes said.

She also noted that short sales and foreclosures appear to be attracting buyers to the market, and this trend probably won’t disappear anytime soon.

“Short sales and foreclosures are a reality of the market and will be for quite some time,” Windes affirmed. “The market continues to adjust to current conditions, as it always does.”

Windes observed that federal tax incentives continue to draw buyers to the market now that the deadline for the first time homebuyers’ $8,000 tax credit, originally implemented in 2009, has been extended to include buyers who sign sales contracts between Nov. 7, 2009 and April 30, 2010, providing they haven’t owned a primary residence in the past three years.

Additionally, a relatively new tax credit allows qualifying repeat buyers to reap up to a $6,500 tax credit, if the home being sold or vacated was used as a primary residence for at least five consecutive years of the past eight.

With all the programs, incentives and other factors affecting the market, it’s particularly important to Rely on a Realtor, said Windes. “Realtors are bound by a higher code of ethics and are required to disclose materially known defects,” she said, listing just a few of the advantages Realtors bring to a transaction. “And Realtors know who’s who among lenders, property and pest inspectors, surveyors, appraisers and closing agents.”

This article was contributed to The Log by the EmeraldCoastRealtors.com