In its latest report on the status of the local residential real estate market for May 2011, the Pinellas Realtors Organization called it “strange.”

Citing the dwindling inventory of active home and condo listings (pegged at -22% and -12%, respectively), the PRO says that this situation would normally cause prices to rise. However, that didn’t happen in May, when the median sales price for single family homes dropped from $139,000 to $117,000 from year over year. Similarly, the median condo sales price was down from $139,000 to $117,000 from year over year.

Meanwhile, the overall residential market sales increased from 1,275 units to 1,316 units or up 3% from May 2010 to May 2011.

Legal Issue Insights

Having a real estate lawyer represent you in a home or commercial property sale or purchase can save you a lot of money. The contracts and multitude of forms and letters associated with a closing can be confusing. Review of a prospective real estate sale or purchase can give you real peace-of-mind that you will not have future legal issues resulting from the transaction.

Among the potential issues that could arise in any real estate transaction are concerns about having clear title to the property, including identifying potential property liens; property boundary disputes which might require a site survey; or Florida homestead issues.

Remember, real estate purchases frequently represent the most valuable asset a person has. Contracts and loan terms can be confusing. Call DeLoach & Hofstra to get a seasoned, reliable real estate attorney who will protect your personal and financial interests. Our firm is large enough to handle the most complex and sophisticated transactions, but small enough to deliver the personalized service our clients need.

The Wall St. Journal’s front page, top of the fold headline may be good news for the troubled Florida housing market. WSJ reports that cash buyers are buying homes at a vigorous pace. These buyers are betting that home prices are at rock bottom and the housing market across the country is poised to rebound. Last year, 28% of all sales were all-cash transactions. In 2008, the rate of all cash housing transactions was 14%. The local Tampa market, which had the third highest rate among cities surveyed by the Wall St. Journal, jumped to 44.6% of its housing sales listed as all-cash transactions.

The Journal concluded that “Residential real estate has been slower to bounce back than stocks, but the presence of apparent bargains is luring in newly confident buyers.” Hopefully, this is a trend and not an anomaly. Our local Tampa Bay market is dependent upon strong housing sales if it hopes to recover from the poor economy.

It used to be that banks would foreclose on homes and condos when owners became delinquent with their mortgage payments. Now, that’s changed. Condo owners who’ve fallen behind their mortgages or their association dues may be facing foreclosure by the condo association. Banks don’t want to do it because then they are responsible for the association fees. So, with the advent of a new law, condo associations

According to the article in the St. Pete Times today, “HOAs are seizing more and more property as owners stop paying their monthly assessments. Some are going a step further — renting out the seized properties to recoup the lost dues. And thanks to a new law, they don’t even have to foreclose to collect rent in some circumstances.”

Tough economic circumstances have led to such a drastic change. “A Florida law enacted on July 1, 2010, allows homeowner and condominium associations to seize rent from tenants who rent from delinquent owners — even before foreclosing.”

While the normally slow holiday month of December showed marked improvement in the real estate market, a closer inspection of those numbers reveal a troublesome statistic. Condo and single family home sales dramatically increased during December 2010. However, half of those sales were the result of short sales or foreclosures. The mixed message provides no solid indication that we are out of the woods as far as the Pinellas County real estate market is concerned. The sales prices for both condos and single family homes continues to drop even though the volume of sales for both markets is up since the same period last year.

The St. Pete Times recently reported the same trend for upscale luxury homes in the Tampa Bay area.

“The Times reported last month that the sales of million-dollar-plus homes and condos aren’t skyrocketing in the bay area, but they are selling again — at a discount. Sales were up 22 percent in Hillsborough, Pasco and Pinellas counties in mid December.” For instance, former NBA player and Countryside High School basketball star Matt Geiger’s Tarpon Springs mansion finally sold this month after being on the market for four years. The original asking price of $20 million was reduced to $8 million in order to move the property.

What happens when condominium owners stop paying their condo dues and maintenance fees or become delinquent on their mortgages?  As is evident in a recent Wall St. Journal article, it creates for neighborhood tension, hard feelings, and in some cases, action by the condo association itself.  In Florida, in certain circumstances, a condo association is allowed to take temporary title of residential condo units from people who aren't paying the maintenance fees they agreed to pay.  In the example cited by the Journal, one condo association went even farther.  They  installed a fingerprint-scanning device that would bar condo owners who were delinquent on paying their fees from entering the clubhouse or the pool area.

The decline in the real estate market coupled with a tough job market has caused some condo residents to forego mortgage payments and association dues.  Unfortunately, this affects the other condo owners and the overall real estate market.  It's not a good situation and has led to some angry confrontations between condo owners as well as rifts among condo association board members, according to the Wall St. Journal article.

The Florida condominium market is finally showing some signs of improvement while the Sunshine State's housing market remains grim.  Sales of existing condos rose by 5% in the month of November while condo sales have improved by 11% in the last year.  This is a positive sign for the condo market as well as the many condominium associations I represent here in Florida.  As the winter sets in up north, the upward trend should improve in the first quarter of 2011.  Of course, the condo market and the overall real estate market can be affected by the nation's economic recovery, especially since so much of our economy is based on service industries and tourism.