Destin and the rest of the Gulf Coast have seen a rise in rental properties and home ownership since January. Although the latter faltered somewhat since the beginning of the year, by the middle, the market started increasing again but not at the same level as before the real estate crash in 2007. With homes reasonably priced, as well as foreclosures and short sales on the market, many are purchasing homes in general. Couple that with a desirable destination, and you have a local real estate market that has seen somewhat of an upswing, according to The Destin Log.

According to the piece published in The Destin Log, single family homes saw a 45-percent increase in fall, while condo sales increased 82 points over the course of a year. For single family homes, some of the factors for the increase might have included buyers waiting until fall and the tax credits for first-time home buyers. For the former, the fall appears to be an easier time to buy a home, as, aside from being “shoulder season” for snowbirds, getting to view a home or unit is easier and sellers are easier to negotiate with. Additionally, the tax credit for first-time buyers has been extended to April 30, 2010 and a new tax credit for repeat home buyers was also created.

Condos, on the other hand, don’t always fall into the “home” category and many snowbirds, always present in the Gulf Coast during the fall and winter, look for a second home. Perhaps the reason behind the condo sales increase is simply that the lowered prices this year have attracted more buyers looking for a second home, be it for a winter residence or a summer vacation getaway. Either way, the market for Destin real estate has been on a steady upswing since the middle of the year.

Destin and the rest of the Gulf Coast area have been named an up-and-coming vacation destination, but, not until recently, did it get any notable recognition outside of the US. Frommer’s Travel Guide named the Gulf Coast as one of the Top World Vacation Destinations for 2010. Some of their reasons, as mentioned in the link, include diverse recreational options, beaches, trails, and “quirky” restaurants. Additionally, the affordability is another important factor that catapulted the Gulf Coast to such a status. In their decisions for top vacation destinations in the world, the Gulf Coast was placed alongside Abu Dhabi, United Arab Emirates, Hawaii’s largest island, and Hanoi, Vietnam.

For specific areas cited in Frommer’s decision for the Gulf Coast, both Destin and Seaside (part of South Walton) were highlighted. But is this really news? From one perspective, it is. Destin has shot from being a premiere local vacation destination to one, in the course of just a couple of years, that now has world-wide recognition.

Do Destin and the rest of the area deserve such recognition? In a word: Yes. Destin and South Walton have been touted as the best kept secret for a vacation destination solely because of these reasons. People have been traveling to the area for its beaches for years and the entertainment and nature compound to this. The fact that most activities in the area are affordable puts it ahead of other beach destination peers in the US.

Such a rank could affect the traffic for 2010, and Frommer’s seems to anticipate this. 2009 saw a large jump in terms of rental traffic, partially due to the economy causing many to stay home. But, it’s possible that a poor economy worked to Destin’s benefit and, instead of becoming just another seaside destination with a nice beach, it made the entire Gulf Coast seem like the perfect vacation destination for a variety of budgets.

Beach renourishment has been an issue this past decade in Destin and a case by the Stop the Beach Renourishment Inc. association has made it to the US Supreme Court. The case, which involves beach homeowners saying renourishment lowers property values ruled in favor of government projects, like beach renourishments, that prevent erosion. The Stop the Beach Renourishment association is still pushing their case to the Supreme Court.

What’s the background for the case? Although the linked article goes into more detail, owners of beachfront properties in Destin claim that the beach renourishment project the local government has been doing separates them from the sea by a 75-foot wide sand barrier. Because of this barrier, the Stop the Beach Renourishment association, a group of five Destin beachfront home owners, claim that their homes are no longer classified as “beachfront properties” and, thus, their properties have been devalued. Because of their claims of devalued properties, they state they should receive compensation to make up for the property differences.

Another issue in this case is property lines, mainly what is classified as a property line for Destin beachfront real estate. For the Gulf Coast and any areas in Florida with beachfront properties, the property line is set where high tide peaks, according to the Department of Environmental Protection. With more sand added to the beach in renourishment projects, this means the property lines were moved farther away from the homes and, in Destin’s case, this has created the said sand barrier. Although, because the homeowners are still able to access the beach regardless of the barrier, the Florida Supreme Court ruled that these homeowners still have access to the water and, because of this, their homes are not devalued.

The third issue presented here is erosion, which all beaches in the US face. In fact, as mentioned in the article, one on four homes become damaged due to beach erosion, which is why renourishment is done in the first place. Areas that experience hurricanes, such as Destin and other Florida coastal cities, can experience more damage, such as the aftermath of Hurricane Opal in 1995. Although Destin has come a long way in 14 years, beach erosion leaves properties directly on the beach open to more damage with a hurricane approaching. In fact, the last significant hurricane, Ivan, still caused some damage to coastal properties in Destin.

Homes, whether sold ordinarily or as foreclosures, may be considered defective. If the defective home is sold as a foreclosure, in general, there’s nothing that the former owner or bank can do, aside from keeping the house in presentable form. But if you’re not selling your home as a foreclosure or a short sale, a defective home may be a difficult sale. What counts as a “defective” home? About.com has a specific listing of what makes a home defective or less desirable. For some basics, defective homes have at least one of the following that can make getting sold difficult:

• Bad location. Whether a house is close or on a highway, near train tracks, or in simply a “bad” neighborhood, all of these may qualify as a less-than-desirable location to own a home.
• Bad layouts. Things like narrow hallways and poor layouts inside of a home can make it defective.
• Damaged homes. Although the term “fixer-upper” is a common term for homes needing work, when a home needs $50,000 worth of work inside or outside, it’s beyond being a “fixer-upper.” Even if a contractor fixes up the house, the labor needed should be factored into the cost of the home.

If you’re considering selling your home and have some of these defects, the solution, as offered by About.com, is to put a positive spin on it. A bad location can have some desirable aspects, such as being close to a school or parks or being in a location less prone to thefts. Although bad layouts and damaged homes can be difficult to find a positive aspect, the benefits of these include being sold as less than most homes.

A website like Josh McLean Homes offers short sales and foreclosures, but, if you’re considering one of these as the last resort, which one should you consider? Both types of sales can affect your credit, as we have discussed, but a short sale is considered less of a negative remark on your credit report than a foreclosure. But how do you know if you quality for a short sale? A list of qualifications is listed on the home buying blog at About.com, but here is a condensed version to see if you could qualify:

• The market value of the home is lower. If the home has been on the market and the value of the home is less than the unpaid balance, the property could be sold as a short sale. The danger lies in the pre-payment penalty a current home owner will have to pay.
• The mortgage is on or near default status.
• The seller or home owner has fallen into financial difficulty. This requires a letter of hardship, and not all conditions of financial difficulty qualify. According to About.com, this can be unemployment, divorce, medical emergency, bankruptcy, and death. Moving to a smaller residence or pregnancy does not qualify. This type of hardship letter, in addition, needs to be about not being able to make monthly payments and why you can’t pay the difference between the market value and what remains in mortgage payments.
• The seller has no assets. Assets can be used to make mortgage payments in some degree, but if you have no assets, you might qualify for a short sale. Assets, however, consist of savings accounts, real estate, stocks, and IRAs or other retirement accounts.

If you fall into one of these categories, your property may qualify for a short sale. If you’re wondering about the consequences, consult the link at About.com or previous posts about short sales on this blog.