Survey: Few Floridians think their house values will dip in five years

August 8, 2007

Floridians are optimistic about housing prices despite the gloom pervading much of the real estate industry, a new University of Florida survey finds.

Only 5 percent of 287 Florida homeowners said they think their house values will fall during the next five years, according to the survey, which was conducted in July by UF’s Bureau of Economic and Business Research.

Eighty-two percent expected the value of their houses to rise, and 13 percent said they would remain the same. The median respondent expected a gain of 18 percent, or a little more than 3 percent a year.

UF economists said they were not surprised by the results.

“The last time housing prices fell and didn’t recover within five years was during the Great Depression,” said Jonathan Hamilton, a UF economics professor and chairman of the economics department. “Most of the problem in Florida right now is that we’ve had a huge amount of building and lots of speculative buying, and things are now catching up.”

Although there is a large inventory of condominiums for sale statewide, many of these units are likely to be sold and occupied within the next few years, he said.

Florida’s draw as a retirement destination as the baby boomers age is another factor that bodes well for the state, said David Denslow, a UF economics professor who led the research. “As these baby boomers flood into Florida, they will be pushing housing prices up,” he said.

The questions were asked as part of the bureau’s monthly consumer confidence telephone survey. The responses about housing price expectations did not vary significantly by age, race, gender, region within the state or current house value, Denslow said.

“This surprised me a little bit because we expect people to be more pessimistic where there is a huge glut on the market such as the Tampa Bay or the Orlando area,” he said. “The people who do distressed house sales, the Web sites where they say they’ll buy your house for only 80 percent of its value, they love Orlando right now.”

The housing market is in a period of correction after the dramatic appreciation in real estate values nationally and particularly in Florida since 2000, Denslow said. In most Florida markets the median price of existing homes is declining, he said.

“Although these declines are temporary, there will be at least some Florida markets where house price appreciation will be very low over the next five years,” he said. “My guess would be that you’ll see low house price appreciation in the Tampa Bay, Orlando and Miami area simply because of the number of existing units on the market.”

In contrast, large price reductions are unlikely in Gainesville or Tallahassee where the housing boom has not been nearly as dramatic, Denslow said. “And similarly, I don’t think that Jacksonville is going to be hurt as badly as Fort Myers or Naples or the Fort Pierce area,” he said.

The survey’s error rate was 4 percent.

Source: UF

Explore further: Obama unveils high-speed Internet help for low-income homes

Related Stories

Obama unveils high-speed Internet help for low-income homes

July 15, 2015

Calling the Internet a 21st century necessity, President Barack Obama on Wednesday unveiled a program to bring faster Internet connections to more low-income households, particularly to help students living in public and ...

Shyp reclassifies contract couriers as employees

July 3, 2015

Shyp, the quickly growing startup that provides on-demand courier services, said Wednesday it would reclassify its contract workers as employees, becoming the latest high-profile tech company to change how it compensates ...

Recommended for you

French teen finds 560,000 year-old tooth (Update)

July 28, 2015

A 16-year-old French volunteer archaeologist has found an adult tooth dating back around 560,000 years in southwestern France, in what researchers hailed as a "major discovery" Tuesday.

The couple who Facebooks together, stays together

July 27, 2015

Becoming "Facebook official" is a milestone in modern romance, and new research suggests that activities on the popular social networking site are connected to whether those relationships last.

0 comments

Please sign in to add a comment. Registration is free, and takes less than a minute. Read more

Click here to reset your password.
Sign in to get notified via email when new comments are made.