Have we turned a corner? Barrier island condo sales on the rise

Special from Vero Beach 32963

INDIAN RIVER COUNTY — Sales of condominiums on the barrier island were up 15 percent over the summer months as buyers scooped up bigger and better deals in what has been one of the softest segments of the real estate market here and in the region.

The news is the second positive sign that perhaps the economic slowdown that has gripped Indian River County is starting to loosen. Piper announced this week that it expects to increase production in its Vero Beach plant by 50 percent in 2010. In a market such as Vero Beach has experienced the past couple of years, Realtors look for any positive trends as indications of recovery and rebound.

According to MLS data, 50 condominiums sold on the barrier island from June 1 through Sept. 30, a 15 percent increase from the 43 closings during the same time period in 2008. Sales ranged from $110,000 to $1.75 million for barrier island condos.

Prices are going down, however, as sellers get antsy and more willing to deal after making mortgage payments on vacant units listed for many months or even years.

The average list price in 2008 was $506,988 with the average selling price being $428,734. This year, the average list price was down to $431,451 and the average selling price was $368,218. The average condominium sold this summer was a two-bedroom, two bath unit of about 1,600 square feet, slightly larger than the 2008 average size of 1,490 square feet, so buyers are also getting more living space for their money.

The barrier island has plenty of bargains, a factor that Norris & Company Owner-Broker Gena Grove said could foreshadow a lucrative upcoming season when the snowbirds return. Some may look to upgrading their existing vacation home or to invest, now that stock portfolios have begun to creep out from the depths of last autumn’s global banking crisis.

Grove said the activity seems to be spotty, with certain areas showing more signs of life in the condo market than others.

“Last year, the major area for activity was Central Beach because of the bargains there and the revitalization of the Central Beach Village area around Ocean Drive and the hotels. Now that has leveled off some but is still steadily improving,” she said. “Now the area that has blossomed up is Indian River Shores all the way up to County Road 510.”

Grove said her office placed three Baytree oceanfront condos under contract in the past couple of weeks. She emphasized that the oceanfront properties, whether in the single-family or multi-family market, are always a precious commodity due to the area being mostly built-out and the finite amount of ocean views and beachfront to be had.

Norris and Company’s Grove said she thinks some of the hesitancy up to now has been the rate of foreclosures and defaults of association fees. It seems that possibly the worst is over and that losses to condos have had a chance to “shake out” or at least make their way to the association’s books so buyers who do their homework can at least go in with eyes wide open.

“I think people have been waiting to see if the condominiums were going to be okay. People who ran into financial difficulty, a lot of them just walked away from their condos and let the bank take them back,” she said. “The condo market in Vero Beach is primarily second and third homes and it’s just taking a while to attract the people to invest in second and third homes again.”

Of all the barrier island condominium communities, something almost magical seems to be happening down at the Moorings.

Compared to the same time period in 2008, sales were up 120 percent from June 1 to Sept. 30, with closings rising from six in 2008 to 13 this summer. Prices there also rose slightly, with the average going from $319,833 for the average of the units sold from June 1, 2008 to an average of $367,461 for the units sold from June 1 to Sept. 30 of this year.

“Prices have reached a point where the buyers finally realize the values,” said Moorings Realty Sales Company Broker Marsha Sherry. “We are seeing Buyers who believe that prices have bottomed out – that’s a good sign and the first step to prices starting to increase.”

Sherry said she’s spoken with appraisers and, though most experts agree with the buyers that we’ve hit the bottom of the market, condo values don’t seem to be moving upward yet. This means there is still an unknown window of opportunity to take advantage of what may be the best condo prices in a decade for a home with a breathtaking view of the river or the ocean.

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