More Accurate Home Price Data for Florida

The chief economist for Florida Realtor’s, the state’s real estate group, has been hard at work to develop a home sales price index, reportedly the first of its kind in the nation. The index will offer a more accurate measure of property values in Florida’s recovering market. The state was hit particularly hard when the real estate bubble burst back in 2007. The index will resemble the widely trusted Standard & Poor’s/Case-Shiller report, and is scheduled to launch in September.

The index will include regional and county-wide information, and will include every parcel in the state. The hope is that this index will offer a more accurate reflection of monthly median home sale prices. Realtors often complain that the current method isn’t an accurate reflection of increasing and decreasing values, and the numbers can fluctuate widely, especially when large numbers of foreclosures and short sales, and luxury homes sell in a particular month. The new “repeat sales index” will offer a combination of Florida Department of Revenue data, and the prices of individual properties sold over time. The index will be released in quarterly installments and will include data back to 1995.

Adds Bill Richardson, district sales manager at The Keyes Co. in Boca Raton and a past president of the Realtors Association of the Palm Beaches,” This is definitely the thing we’ve been waiting for and it will be much more reflective of what prices are doing. It’s truly something we’ve needed.”

According to NAR spokesman Walter Moloney, no other state has its own price index. In California, the “affordability index” is perhaps the closest thing, however, that shows the percentage of all households that can afford to purchase a single-family home and the sale prices are still reported as median. When asked about Florida’s new index, Moloney said, “All of the measures have strengths and weaknesses, but a repeat sales index is probably better than a median price on an aggregate basis. We’re looking at developing one on a national level but it’s not quite ready for prime time yet.”

Case-Shiller’s Florida data only includes Tampa and South Florida, including Palm Beach, Broward, and Miami-Dade Counties, so the new index will be a welcome tool for real estate agents who are looking for a more complete overview of home prices. It will be a great way to monitor Florida real estate sales, and John Tuccillo, the chief economist for Florida Realtors, has made this a priority since he started with the organization last year. He is the former chief economist for NAR.

Details of the index are not being released quite yet, however, Tuccillo did say that for the past two years, prices in Florida have essentially bottomed out. Back in January, he worked to institute a change that allows realtors and home buyers to access statistics by zip code. He adds, “As a colleague said to me, we’re now moving along a cobblestone road, flat with bumps. This is really the first of its kind in the nation. We’re pretty proud of it.”

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