TAMPA – Oct. 5, 2009 – It’s the million dollar question in real estate: what makes one home’s value plummet even when a similar home in another neighborhood remains stable?
Data show that home values can vary widely, depending on the neighborhood, the age of the home and the economic stability of neighbors. No Tampa Bay area neighborhood is immune to this housing downturn, but some neighborhoods are suffering more, housing professionals say.
“In general, areas that had minimal decreases have been around for some time and were not as susceptible to investors,” said David Teacher, a property appraiser with Superior Residential Appraisal Services Inc.
Even in those neighborhoods, however, there are exceptions.
Teacher, who has experience throughout the Bay area, looked at neighborhoods in Hillsborough and Pinellas counties that have been particularly hard-hit by depreciation. His research, which tracked home sales prices across the region since 2005, shows that some have fared better.
New developments in south Hillsborough County saw prices go up quickly during the housing boom and some have seen them drop fast during the bust.
For example, Symmes Grove in Riverview saw its average sales price fall from $188,621 in 2005 to $119,787 so far in 2009. That’s a drop of 36 percent.
Another neighborhood with newer homes, FishHawk Ranch, saw the average sales price of $332,027 fall 15 percent to $282,407 this year. Teacher said many homes in FishHawk have lost significant value, but since the neighborhood is diverse with homes that sold for less than $200,000 and homes that sold for half a million or more,” the average for the neighborhood was among the best ones he studied.
In many neighborhoods, he said, the less expensive homes are hit hardest.
Consider a home on Bridgewalk Drive in FishHawk: It sold for $380,500 in 2006 and $200,000 earlier this year. That’s a 47 percent drop, far more than the neighborhood’s average.
In general, homes in established neighborhoods have held value better. Part of the reason, Teacher said, is that fewer investors purchased during the housing boom, and the foreclosure rate is typically lower than in newer subdivisions.
One neighborhood that has remained fairly stable, Teacher said, is the area of South Tampa, west of Westshore Boulevard. The average sales prices of $662,634 in 2005 dropped 4 percent to $634,764 in 2009. Part of the reason may be that the neighborhood is established and hasn’t seen as much sales activity as some other areas.
Another South Tampa neighborhood, Beach Park, known for luxury homes, saw the average sales price of $646,891 drop 22 percent to $505,952 this year.
It’s not just the age of the neighborhoods that contributes to value changes. It is also relatively low prices in certain neighborhoods that attracted investors.
Pinecrest Villa in Tampa attracted investors during the housing boom who bought homes a handful at a time, Teacher said. Many of them have defaulted on loans and lost homes in foreclosure. The average sales price of $168,728 in 2005 has dropped to $73,500. The 56 percent drop is the highest neighborhood decrease Teacher observed.
One established neighborhood in Tampa, Westchase, had homes lose very little value, while others have seen prices drop.
The neighborhood’s average sales price of $361,140 in 2005 dropped 20 percent to $287,417 in 2009.
Maria Kletchka, a Coldwell Banker real estate agent who works in Westchase, said the neighborhood’s diverse mix of home prices has helped keep the neighborhood stable. It also hasn’t seen as many investors or foreclosures as some other neighborhoods, she said.
That said, it has still seen trouble.
“A bank-owned home sold for $211,000 just today,” he said. “During the boom, it would have sold for $350,000.”
Like every neighborhood, though, it all boils down to when you purchased.
“If you bought during the housing boom in 2005 or 2006, you’re likely upside down and owe more than your home is worth,” she said. “If you bought before then, you may still have some equity.”
Copyright © 2009 Tampa Tribune
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