Steve Eckhardt, Tampa & Sarasota Luxury Broker

Sales of million dollar homes took a dive in 2008 for both the Greater Tampa Bay area and the Greater Sarasota/Bradenton areas. The scarcity of jumbo loans, falling investment portfolios, and economic pessimism all contributed to the slow sales in the luxury home market.

The following statistics are taken from the Mid Florida Regional MLS and cover single family homes over $950,000. The Greater Tampa Bay area statistics cover Hillsborough, Pinellas, and Pasco counties. The Greater Sarasota/Bradenton statistics cover Sarasota and Manatee counties.

Greater Tampa Bay Area

492 homes over $950,000 sold in 2008 vs. 601 homes in 2007. The drop of 109 homes represents an 18.13% decrease in sales of million dollar homes. The average list price in 2008 was $1,720,163 and the average sales price was $1,339,315. A discount of 22% off the average asking price. The average size of the luxury homes sold in Greater Tampa Bay was 4089 square feet with a average price of $327.54 a square foot. There are currently 1446 homes over $950,000 available for sale in the Greater Tampa Bay area. 30% of the luxury buyers in 2008 paid cash.

Greater Sarasota Bradenton

537 homes over $950,000 sold in 2008 vs. 733 homes in 2007. The drop of 196 homes represents a 26.7% decrease in sales of million dollar homes. The average list price in 2008 was $1,920,218 and the average sales price was $1,633,010. A discount of 14.9% off the average asking price. The average size of the luxury homes sold in Greater Sarasota/Bradenton was 3545 square feet with a average price of $460.65 a square foot. There are currently 1561 homes over $950,000 available for sale in the Greater Sarasota/Bradenton area. 55% of the luxury buyers in 2008 paid cash.

As you can see from the above statistics, the Greater Sarasota/Bradenton area had a much larger percentage of cash buyers. And while they had a larger percentage drop in the number of homes sold, they were able to command 40% more per square foot and keep the sales price to listing price discount at 14.9% vs. 22% in the Greater Tampa Bay area.

Nationally, the number of luxury homes on the market increased in the month of January after 5 straight months of falling inventory. The statistics are compiled by the Institute For Luxury Home Marketing and Altos Research. (The chart covers homes on the market for at least $500,000 in the top 10 zip codes for 31 major metro markets around the county.) I expect this trend to last through the Easter holiday and then start a gradual decrease through July.

If you are considering the purchase of a luxury home on the Gulf Coast of Florida, please call or e-mail. Steve Eckhardt, Broker, (813) 765-1182 or steve@TheFloridaAuthority.com

The following is a blog that I posted last night under the title "30% Off Sale On Homes". I can't tell you how happy I was to be watching Fox News this morning and see Lawrence Yun, the Chief Economist for the National Association Of Realtors stating that the latest figures had housing affordability pegged at levels not seen since 1973. Imagine that! The average person buying an average home, with an average interest rate is paying LESS, as a percentage of income, than they would have paid for an average home in 1973! WHY AREN'T WE SEEING THESE HEADLINES IN EVERY SINGLE NEWSPAPER AND ON EVERY NEWSCAST NATIONWIDE?!

A couple days ago the media reported that existing home sales for December had "unexpectedly" increased by 6.5% to an annual rate of 4.74 million units. The South fared even better with a 7.4% increase in sales. And, the number of unsold homes on the market last month fell nearly 12% to 3.7 million homes. At the current sales pace, it would take 9.3 months to sell all the properties. This is down from 11.2 months in November.

Can we take a moment to look at the current numbers since nobody seems to be pointing out the obvious? The median sales price has plunged 15.3% in just one year. The average 30 year fixed rate has dropped from 6.58% in August to 5.14% last week. A drop of 1.44% and an additional 15% of buying power. So, the average buyer looking at a $450,000 home last year, would have been looking at a $2294.42 P & I payment had they put down 20% and locked in at the average 30 year rate of 6.58%. TODAY, the same home is selling for $382,500 and the P & I payment is $1668.96, assuming 20% down and a 5.14% interest rate. A 27.2% DECREASE FOR A MONTHLY PAYMENT!

Are you giving this information to your customers that are sitting on the fence? Don't be surprised if we see more "unexpected" numbers over the next six months. Interest rates aren't going to stay this low. The smart buyers understand that the price of a home is only one factor that determines the total cost. If the interest rates go back up to 6.58% and real estate prices drop another 15%, their monthly housing cost is going to remain the same.

The big difference will be the available inventory. Last month, inventory dropped 12%. The doomsayers are saying that the next wave of adjustable rate mortgage foreclosures are coming and inventories will increase again. Interesting theory, but I think that they are overstating the problems with adjustable rate mortgages. While some programs like the option ARM are problematic, the popular 1, 3, & 5 year adjustable rate mortgages pose much less of a risk. I have a one year adjustable that I've had for 3 years. The first year it was lower than the 30 year fixed rate. The second year it dropped. Last year it dropped again. Today, I received my new adjusted rate. My rate fell from 5.75% to 4%. My monthly payment dropped 18%! This is IN ADDITION to the 11% decrease in my property taxes this year. Is there anybody talking about these mortgages and variables?

The smart money is already starting to search. Our global listing traffic is up 240% since October. With 4 days left in January, we've already exceeded our page views from December. And January is typically one of the slower months of the year. As long as interest rates stay low, I think we'll start to see significant inventory reduction and many more "unexpected" results. Here's to a great 2009!

A recent poll done by Opinion Research Cop., surveyed 1000 U.S. adults and asked: "Do you think the financial press is making the economic crisis worse by projecting fear into people's minds?" A WHOPPING 78% said YES. If that is the case, why is it that almost every person we meet lately wants to talk about all the negative around us? In my opinion, they are looking for reassurance.

I attended several holiday parties and visited relatives, and I was asked no less than 50 times in the last month, "How is the real estate market?'. Every time the question was asked, it was accompanied by a look of despair that suggested I had just lost a member of my family. In every instance I replied "Great!" with a huge smile and then proceeded to give the reasons why (low prices, lowest interest rates in generations, huge inventory to choose from, etc). Believe it or not, 98% of the people I spoke to about real estate listened to what I had to say and walked away from our conversation with a much improved attitude about the market. I truly believe that most people are out there looking for positive reassurance. That's why my New Year's resolution for 2009 is to ATTACK THE NEGATIVE.

I started two weeks ago on an article in the Walletpop section of the AOL website. A blogger was commenting on a story about FHA loans and spouting off about how much the average consumer has purchased and what "they" can afford without giving any concrete numbers or data to back up his claim. I have since "ATTACKED" over 15 random posts with actual facts and figures that refute the negative chatter on these message boards and blogs. The funny thing is that only one time have I received a response. The response was incoherent and talked about the fact that just because he "could rent a $500 a night hotel room does not mean that he could buy the hotel". Don't let the negative continue to dominate the marketplace! If we want to see a change in what is being said in our newspapers, on websites, and in blogs, we need to take the initiative to educate the public and the publishers.

With a degree in Economics, it's second nature for me to look for the statistics and the proof behind a story. My 2009 business plan includes one hour a week of "Attack The Negative". Know your market and know your numbers. When the newspaper or web article reports that foreclosures "Increased 28% from the same month a year ago", make sure that they also report that only one in every 488 U.S. Homes are in Foreclosure, that this number was down 7% from the prior month, or anything else they purposely left out to sell the doom and gloom. My glass is half full, is yours?

For the last 3 years I have been telling my agents, my customers, and anyone else that would listen that print advertising for real estate is on it's way out. The listings were old, the ads didn't contain the newer listings, and you weren't able to get a feel for the home like you can with virtual tours and online video.

Apparently, I was right. A new study conducted by Harris Interactive and sponsored by Intel Corp. finds that 65 percent of adults feel they cannot live without Internet access. Additionally, 71 percent consider it important or very important to have Internet-enabled devices, such as laptops and mobile communications on hand almost constantly.

According to the survey, 46 percent of women and 30 percent of men would rather go without sex for two weeks than give up Internet access for the same amount of time. For women ages 18-34 it was 49 percent and for women ages 35-44 it was 52 percent. For men ages 18-34, it was 39 percent. I don't know for sure, but I would guess that newspapers and other print advertising have NEVER experienced that kind of popularity!

Obviously, the study didn't focus on real estate, but if people are that passionate about Internet access, wouldn't it just make sense that the Internet is where they are going for their information? The 2008 National Association Of Realtors Profile of Buyers and Sellers says that more than 90% of home buyers 44 years old or younger used the Internet as a source of information during the home buying process and 87% of ALL buyers used the Internet during the process. It goes on to say that 69% of buyers used the Internet FREQUENTLY to find a home compared to 15% that used a print or newspaper advertisement frequently to find a home.

If you are a professional listing agent, it only makes sense to spend the bulk of your advertising dollars online. We're in our 2nd year of 100% Internet advertising. We've invested heavily in our website, SEO (search engine optimization), and listing syndication. In November we had over 652,000 page views of our 53 listings on just Realtor.com. That's over 15,000 views per listing in a single month. If you consider that Hitwise gives Realtor.com a 7.68% market share and our listings are are also on seven of the top ten real estate web sites (as well as hundreds of other sites), we estimate that each listing is viewed an average of 150,000 times each month!

There isn't a publication in the world that can guarantee that my listing will even be noticed in the pages that they print, but with inexpensive (or free) tracking software, I can tell my clients how many times their home has been viewed, how many times the virtual tour has been taken, and how many times, the potential buyer has looked at a video of the neighborhood. I can even communicate all of this information to the customer on a weekly basis with just a click of the mouse. It doesn't surprise me a bit that half the adults would rather give up sex instead of Internet access. This is exciting stuff!!!!

As we head into the holiday season I am looking forward to a little time off and some great football. Some of the biggest games that will happen are being held right here in Tampa. The Tampa Bay area will be featured nationally and internationally in Outback Bowl on January 1st and in the Super Bowl on February 1st.

The University of Iowa and the University of South Carolina will meet in the Outback Bowl on New Year's Day in Tampa, Florida. The No. 26 Hawkeyes will face the Gamecocks for the first time in history. There will be a FULL schedule of events starting on December 26th through game day.

The Super Bowl festivities will start 2 weeks prior to the game and get into full swing with the opening of the NFL Experience on January 24th. The NFL Experience features more than 50 interactive games and attractions as well as special programming including free football clinics, autograph sessions, the largest football card show ever and NFL Coaches Chats, during which NFL coaches give an inside look into the game of football. The Gasparilla Extravaganza will also run on the 24th and welcome the return of the Gasparilla Pirate season in Tampa Bay! The event features the Children's Gasparilla Parade and the "Piratechnic" Extravaganza, one of the largest fireworks presentations in the country.

And while a good portion of the United States will still be feeling the cold and snow, the weekend after the Super Bowl Tampa will be "invaded" by the legendary pirate, Jose Gaspar, and his band of marauding buccaneers as they return to Tampa to reenact the historic pirate invasion, which began in 1904. Amidst a volley of cannon fire, the City is defenseless as the Jose Gasparilla docks at the Tampa Convention Center at 1 p.m. The Mayor surrenders the Key to the City of Tampa into the hands of the Captain of Ye Mystic Krewe of Gasparilla at approximately 1:05 p.m. And, following another successful invasion of Tampa, the Pirates gather on Bayshore Boulevard for a victory parade, which begins at 2:00 p.m. at Bay to Bay and Bayshore. The 2009 Gasparilla Pirate Fest Street Festival features live entertainment, food, thrilling rides, fun games and amusements for all ages. The Pirate Festival will be located in Downtown Tampa between Kennedy Blvd and Channelside Drive. The Gasparilla Parade in Tampa is the largest parade in the bay area. With over 500,000 people spanning the 3.5 mile parade route it is one of Florida's largest parades.

All of this in January and February! Is it any wonder why Tampa is fast becoming one of the best cities to live?! Football, Hockey, Baseball, Spring Training, College Sports, Theater, Concerts, The Hard Rock Casino, Parks, Bike Trails, Boating, Beaches, Shopping, World Class Restaurants...........AND some of the nicest real estate in Florida.