Insiders Upbeat About Housing Turnaround

More than 200 builders and real estate professionals gathered to hear experts on the local market discuss statistics, perceptions and reality at the Marriott Southpoint.

Mark Vitner, director and senior economist with Wachovia, opened the seminar with a preview of what lies ahead locally and nationally. "Home sales peaked about a year ago," Vitner said. "And we're about halfway through a major correction."

"Consumer spending is growing more modestly, but it will hold up better than expected thanks to job growth," he added. "Businesses are still cautious, though, because capital spending has not picked up as much as had been thought."

Locally, Vitner said the unemployment rate remains extremely low, and relocators are still drawn to the First Coast in part because of job opportunities.

Vitner noted that builders have dramatically decreased production so they can clear their inventories. Therefore, he said, housing prices are likely to cool a bit but not drop. Northeast Florida home prices remain more affordable than those found in other markets statewide, he noted.

Prudential Network Realty of Northeast Florida founder and CEO Linda Sherrer compared today's situation with previous slowdowns-and said conditions are much more favorable for a quick turnaround.

"We're in a very different economic climate today than we were in either of the most recent contractions," she said. "The late 1970s, early1980s and again about 10 years later were also times of job losses, a recession and double-digit mortgage interest rates. Does anyone remember 13 percent mortgages?"

The current average 30-year, fixed-rate mortgage is at about 1968 levels, Sherrer added, while the average Northeast Florida home has appreciated 49 percent in five years.

"Compare that return to the Standard & Poor Index, which decreased 6 percent during the same time frame," Sherrer said. "Real estate is still the best deal in town."

Sherrer agreed with Vitner that job growth and relocation are contributing significantly to the ongoing strength of the Jacksonville market

"The National Association of Realtors is projecting that 2006 will be the third best year in real estate history," she said. "With all the outcry about the so-called real-estate bubble, we're still having the third best year ever."

Local real estate consultant Charlie Clark told the group that thanks to an array of choices, low interest rates and favorable pricing, now was a great time to buy a new home.

"Through October, we've had 42,345 transactions[in Duval, Clay, St. Johns and Nassau counties]," Clark said. "Does that sound like a disaster to you? I've been in real estate a long time, and it sounds good to me."

Citing population growth as a positive indicator for the housing industry, Clark said Florida can expect 100 million people will move to Florida in the next 40 years. He also said the state will continue to welcome some 80 million tourists a year.

"Of those 80 million tourists, how many do you think will eventually return here to live?" he asked. "Florida is a top vacation destination, and as people start thinking about retirement, Florida looks very good-climate, ocean, recreation. We've got it, folks."

Clark told the group that he expects to see housing pick back up in the third quarter of 2007 and be at 2004 levels by the first quarter of 2008.

Clockwork Marketing Services founder and president Maxine McBride closed the program with practical advice for business owners, managers and other decision-makers.

"People are telling us that they know a lot of what they read and hear doesn't apply to Jacksonville," she said. "They're aware of cycles in the market, and they're a little confused about how long the downturn will last."

McBride praised NEFBA for its "Great Time to Buy" campaign, a multimedia effort during November and December that was designed to educate consumers on the reasons why buying conditions are now favorable.

For more information on the Buy Now program, log onto

www.JaxHomeFacts.com.