by Joe Wilhelm Jr.
Staff Writer
The darkness of the real estate market hasn’t begun to lift yet, but a local market analyst has seen some points of light in the local industry.
The Northeast Florida Association of Realtors hosted Ray Rodriguez, owner of The Real Estate Strategy Center of North Florida, to discuss the state of the local real estate market.
“I understand the market is volatile right now. It’s a new time and the market is changing,” said Rodriguez. “Are we in bad shape? You betcha.”
One reason for escalating occurrences of foreclosure cases is because there are more people who are in need than there is help available.
“In 2008, there were over 13,000 foreclosure filings in Northeast Florida,” said Rodriguez. “We have the TARP (Troubled Assets Relief Program), and the program has helped about 400 people so far, but there are a lot more people that need help.”
This market has not only affected those looking to buy houses, but also those selling. Rodriguez took a look at the real estate along State Road 210 as an example of what the market has become.
“In 2007, the average gross profit on a house sold along the Highway 210 corridor was $61,000,” said Rodriguez. “That same house in 2008 provided an average gross profit of $6,900.”
With profits dropping and foreclosures increasing, businesses in the real estate markets have to find a way to take advantage of these fluctuations.
“The question is how do you deal with it, and, hopefully, profit from it,” said Rodriquez.
He told the audience to pay attention to other factors, like the price of gasoline.
“We saw the out-migration to the suburbs during the ‘80s,” said Rodriguez. “Now we are seeing, for whatever reason, people moving back to the urban core. If gas prices go back up to where they were, that might become an even stronger movement to live closer to where people work.”
He encouraged the Realtors in the audience to present buying a home as a long-term investment instead of a quick return on investment.
“I feel sorry for the people who are trying to sell now,” said Rodriquez. “It’s the people that hang on for the next 5-10 years that will see the value of the property go back up.”
Value isn’t a word that would be associated with condominiums right now, as 7,100 remain empty in Northeast Florida. A lot of emptiness can also be found in over 200 new developments in the same region.
“They have more vacant lots than houses built in them,” said Rodriguez. “But let’s talk positive now. There are new players in the industry.”
With a little more excitement in his voice, Rodriguez talked about Advantage Home Builders, L.A.B. Homes, JDB Homes (formerly Jacksonville Design Build), and Magnolia Homes.
“L.A.B. Homes was the first company to start buying up properties with trailers on them, tearing them down and building single family homes,” said Rodriguez. “Bits and pieces, that’s what the industry is doing right now.”
One of the hot commodities in real estate right now is multifamily properties, according to Rodriguez.
“Duplexes are great right now,” he said. “And Riverside is drowning in them.”
Some rental property owners may have trouble establishing long-term tenants, but a solution is also available for this problem.
“Make the property wheelchair accessible,” said Rodriguez, who uses a wheelchair himself. “Most likely, they will be a long-term tenant because they have accessibility.”
Realtors aren’t the only people feeling a crunch because of the conditions of the market. Builder Lawrence Murr has experienced a lull in the remodeling industry.
“Projects have been smaller lately,” said Murr, of Lawrence Murr Remodeling. “People are holding back right now on work that isn’t necessary, but can you blame them?”
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