Did anybody else read the truly uneducated and offensive blog (I mean diatribe) by Bob Guterma in the PJ on Friday? He railed on about how awful, unkept and unsightly "Central Beach' was (don't you just love broad generalizations) as an example of Vero's barrier island going to pot - even stating the property owners' there paid little attention to their properties. He hypothecized that all of the homes ought to be razed and rebuilt -- and get this: that all A1A fronting homes should be similarly razed and rebuilt FACING A1A, noting precedent for prestige for an A1A address in other Florida communities. Where do I begin? Oh yes, he also noted that the notion of Central Beach homes being worth $500,000 in this market is insane, supporting his opinion with 'who said that a lot in Central Beach is worth as much as one in John's Island?" (Bob's chosen community, by the way) Nobody Bob, that's why values in John's Island are higher than those in Central Beach. Central Beach is not a blight on Vero, rather a reflection of its origins from the '50s- through '70s, with gorgeous live oak canopies and even a few shell path streets. Known for its ecclectic resident mix of educators, writers, families with kids, it is a desirable place to call home for folks not interested in gated club communities like John's Island. Central Beach prices skyrocketed in recent years much like all barrier island properties, and today, many languish on the market due to extreme overpricing -- much like the gazillion of other gated, fancier barrier island homes that languish on the market if they are overprices.
Time and Mother nature are together transforming all of Vero Beach, as human nature and cultural preferences for updated properties one by one convert older homes into renovated homes reflective of today's living and building standars. I dare say that our '04 hurricanes accelerated this update across the whole island -- including lots of dated condos (including JI) that got whomped in the hurricanes and received current code makeovers out of necessity. To suggest that an entire, interesting neighborhood for whom so many have great affection out to be razed is ignorant, are his Guterma's other insults hurled on Central Beach (clearly reflective of one who has not ventured down many of the streets there recently.) Oh -- and the great idea to raze all A1A facing homes and to re-build them FACING A1A, an idea that is as impractical as it is goofy. Would YOU want to live in a home facing A1A, hearing speeding traffic 24/7? I know I wouldn't....

Recent front page article on 'overvalued' markets like Vero just drive me crazy because they include INCOME as a criterion to assess valuation and fail to include intangibles like quality of life or lifestyle. Using INCOME as a criterion in a resort market like Vero in which a huge chunk of purchases are either second homes or for retirmement negates the validity of income -- folks who buy a second home here or who retire here will NOT report income -- so its use skews results. Here is a great example to illustrate my point: in my small neighborhood, just about 50% of owners are either retired or use the home as a second home -- neither would report inocme here. That means the study failed to consider 50% of my neighborhood -- extrapololate this small example to the entire Vero area, well you can see how skewed results would be. Somethings just cannot be quantified, either, like lifestyle or quality of life -- these intangibles are highly important to valuation in a resort community market like Vero. Bottom line: supply and demand fuel valuation and properties are worth what buyers are willing to pay and sellers are willing to accept. Analyses of valuation using tangible criteria like income may work for more traditional markets but not for resort marketplaces like Vero.
PS: the other recent article about the impact of the Internet on real estate missed the headline in my opinion (or more bluntly, had the wrong headline) The Internet is NOT taking its toll on the real estate market; the rise of the Internet's influence in the real estate market has NOTHING to do with recent price corrections. The Internet is a great tool that now offers prospective buyers and sellers greater transparency of information previously difficult to ascertain, like sales data, property conditions -- even liens on specific properties. The 'net has made it much easier to search smarter for properties across the globe from your living room...empowered buyers and sellers are only GOOD for the market and do NOT adversely impact values. The decline is values of late is due to marketplace corrections, not the rise of the Internet.

Very important change in our market detected during my analysis of May barrier island sales:
inventory levels DECLINED for the first time in six or so months. We have approximately 18 months of inventory of both homes and condos on the island -- down for the first time in half a year when inventories had remained fixed at around 22 mos and 27 months, respectively.
What does the drop in inventory levels really mean? I think it means that the correction is over and pricing will remain flat as it is currently, with a slow return to appreciation as invetories continue to shrink -- as further reduction of inventories will cause upward pressure on pricing. Key to the mix as usual: inflation, interest rates and the great unknown, hurricane season.

Great cover story in this weeks Barron's describing the glut in the second home market. I fully believe that the 20% volume decline in sales we've seen in Vero Beach -- and in other markets -- is the amount of investor activity that existed previously and helped the heady markets froth to where they were in 2005....Thankfully because Vero has such strong zoning and building limits on its barrier island, we have far less condos than other resorts areas -- ergo less sheer numbers of units to sell and less impact by definition by the investor mass exit.
Here's a question: what will the investors do with their monies in lieu of real estate? That is if they have any money left after what are sure to be real estate losses.....Any thoughts? Gold, do I hear gold?

Searching for possible homes for a buyer who's relocating to the area (boy what a good time to be a buyer) who is not interested in new homes in character-less subdivisions. Interesting to me what a challenge this actually became, as old in Florida is akin to built in 1990 -- I am used to the Northeast when old meant from the 18th century! Still, there are some interesting homes with the requisite character in Central Beach on the island and in the Royal Palm/Vero Beach Country Club/McCansh Park area that might suit, several with extensive reno that have sat and sat due to overpricing that represent really great values......

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Interesting to chat with colleagues while hosting a broker open house yesterday. While all bemoaned the bloated state of our inventory of properties for sale, they all also knew of specific properties that on the island that have sold with little difficulty after either bring priced to reflect our current market out of the box or with sellers who agreed to the necessary price reductions after initially listing too high to effect a sale. Proof positive that a market is a market and that a property is only worth what a buyer will pay for it as a specific time.