Where a recession is already hitting hard

However universal the decline, this isn't bad news for everyone. It means a half-empty glass for sellers. But it may also mean a half-full glass for buyers. For about $800,000, for instance, it is possible to buy a large and essentially new house with a pool in a gated community with deeded boat dockage and direct access to the Caloosahatchee River and the Gulf of Mexico. That's about $275 a square foot. In another gated development, a three-bedroom home with a courtyard pool, boat dockage and lovely canal views is available for less than $400,000 -- about $185 a square foot.

• Video: 2008's real-estate outlook

According to Realtor.com, there are more than 12,000 listings in Fort Myers alone, with nearly 2,000 available at $125,000 to $175,000. Many cost less than $100 a square foot.

Will prices go yet lower?

No one knows. What's clear, however, is that a seller's disaster may be a buyer's opportunity. A Florida retirement may now represent an opportunity to exchange a high-priced home elsewhere for a bargain-priced home in sunny Florida.

An opportunity checklist

Here is a precautionary list for bargain hunters, culled from conversations with my host, a former executive for a major international company and former commodore of an area yacht club. He has been retired in Florida for more than 20 years.

• A bargain is about more than price. If the property is an ugly dog, it doesn't matter how low the price is, don't buy it. Remember, many of these houses and condos were built by brainless builders funded by nitwit lenders.

• Avoid developments that are not yet complete. You don't know how, when or if the project will be finished. Equally important, you don't know what the long-term homeowners association costs will be because they may be subsidized by the developer at first.

• Read the homeowners association bylaws carefully. Make sure you understand the restrictions and how they would affect your property. Some would protect you. Others might make it difficult to rent the property or sell it in the future. Pay particular attention to the association reserves. If the financial reserves are small, you could be walking into a major future assessment.

• Remember, Florida is hurricane territory. If your development has canals, docks and other water features, there can be significant assessments for repairs. Don't buy if you don't have the money to cope with special assessments.

• Check the water sources for your community. A long-term drought has reduced the water level in many canals by as much as 3 feet. It also has led to strict rationing of irrigation. Some communities have deep wells for irrigation. Others have shallow individual wells that may run dry.

• If boating is your aim, check the depth of the canal or other access to open water. Similarly, if living on a golf course is your goal, don't assume it will be there forever. Check the finances and membership of the club.

• Check the health-care services in the area, particularly if you have special needs or an unusual malady.

• If you wouldn't be living there full time, make certain the homeowners association is responsible for all yardwork. That determines, in large measure, the appearance of your development and how you would experience it.

• Don't buy a property planning on future rental income. With thousands of rental properties competing for the same renters, you'd likely be playing a game of rental musical chairs.

• Do buy a house or condo if you have a solid personal use for it, such as retirement, partial retirement or family vacation home.

• If you wouldn't be living there full time, explore the ease and cost of air transportation and car rentals. Include a budget for these in your planning.

• Don't fool yourself that this market will turn around in a hurry. Whatever the crush of boomer retirees, it will take years to work off the accumulated inventory.

Questions about personal finance and investments may be e-mailed to scott@scottburns.com. Questions of general interest may be answered in future columns. More columns by Scott Burns can be found here and here.

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