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Cheap Home Listings Cause Residential Market to Lag Behind Commercial

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By : John Cutts    99 or more times read
Analysts stated that the presence of cheap home listings is causing the values of residential properties to decline in Jacksonville, Florida, and is slowing the industry's recovery. The commercial property market, on the other hand, is showing some signs of improvement, with fourth quarter absorption posting better numbers than previous periods.

Foreclosure listings in Jacksonville have always been considered by market analysts as a huge part of the reason for declining property values. However, the fourth quarter of 2010 showed that the commercial property industry is starting to shrug off the impact of the huge supplies of foreclosures in the area.

Despite continuous rise in residential and commercial foreclosure listings in Florida, the metro area's industrial, retail and office markets recorded improvements during the period October-December 2010. According to data released by CB Richard Ellis, the office space market recorded an absorption total of 5,832 square feet during the fourth quarter, bringing the total of absorption for the full year to 3,683.

Although cheap home listings remain a serious problem in the region, the commercial segment of the real estate market seemed to be showing some improvements, according to local market analysts. For the fourth quarter, office space vacancy was pegged at 23%, with Baymeadows recording the highest vacancy rate for the segment at 35%. Although the vacancy rate is still below the 13% recorded in the 2006 fourth quarter, it is still better than most periods since the real estate market crisis started around four years ago.

Analysts are hoping that the improvement in the commercial property industry will help the Jacksonville real estate market recover despite the continuous growth of the list of foreclosed properties in the region. For the retail property sector, fourth quarter vacancy rate was at 11%, with Arlington recording the highest vacancy rate for retail at 19%. Back in the 2006 fourth quarter, the retail market vacancy rate in Jacksonville was 5.5%.

Although cheap home listings and huge supplies of residential foreclosures will likely continue in pulling the housing market down, analysts are hoping that the commercial property sector at least will show some improvements in 2011. So far, they stated that office and industrial spaces are doing much better than previous periods.
John Cutts has been educated in the finer points of the foreclosure market over 5 years.

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