With rates dipping to historic lows we get this question a lot.  Should homeowners refinance their existing home versus sell and purchase a new home?

Refinance Existing Home Versus Sell and Purchase New Home

We can make a compelling argument for both.  The best answer depends on your situation.  Odds are, you should probably do something.  If you are happy in your home, it meets your needs, and you plan on being there awhile you might consider refinancing.

If you have outgrown your home, or your home is too much work for you, you might consider a sale.  Inventory is low right now, so it is a great time to sell.  Not only will you be selling in a seller’s market, you will also be financing your next home into one of the lowest interest rate environments we have ever seen.  Of course, inventory is low, so we must make sure you have a home to go to.

Refinance Existing Home Versus Sell and Purchase

Let us throw out a possible scenario.  A homeowner owes about $274,000 on a 1st mortgage and about $243,000 on a line of credit.  Total debt is about $517,000.  Conventional loan limits are set at $510,000, so if this homeowner wants to refinance, it’d be best to pay down $7,000 to get down to the $510,000 limit, otherwise it would be a jumbo loan and priced differently.

The principal and interest payment currently is $2,756.  A new loan at 2.75% would have P&I payment of $2,082.  That is a monthly savings of $674.  Most of that is due to the lower rate.  $28.58 of that is due to paying down $7,000 to get to the conventional loan limit.

This homeowner now has a decision to make.  They can refinance at 2.75% and save $674/mo., or they can sell and purchase another home that suits their needs better at 2.75%.  The key here is the low rate.  This homeowner should probably do something.  The question is, what is best for that family?

Time to Talk

This is where we come in.  We have several lenders we work with.  We can look at your situation, see how much we can sell your home for and how much would end up in your pocket at closing.  The next step is determining where you would go.  It might be local, or you might consider moving to a different area.  We have an app that can show you homes anywhere in the country, and of course being part of the nation’s largest and most successful real estate company allows us to put you in touch with a great agent anywhere in the world.

If you are living in a home that does not quite meet your needs, perhaps it is time to start exploring.  Some people decide a move is not worth it.  Others decide they feel like they are settling and would like to make a change.  Either way, the Ellis Team is here to consult with you.  Personally, we do not care if you decide to sell today or 5 years from now.  We are here for you whenever that day comes.  We are interested in helping you make the best possible decision for your family.

Curious?

If you are a little curious as to what your home value is, you can call us at 239-489-4042 Ext 4.  Ask for Sande or Brett Ellis.  Or, you can find your home’s instantly for free on our website www.swflhomevalues.com

Making a move is not always an easy decision.  There are numbers involved, memories, and just the hassle of moving.  Our team has resources for you to help make your decision easier.  We are not here to tell you what you should do, but rather counsel you and present you with your options.

We look forward to speaking with you and helping you decide which way is the best for your family.

Good luck and stay safe!

See Last Week’s Article “Price at Market Value and Buyers Will Come

You’ve heard the movie quote “Build it and they will come” from Field of Dreams.  The saying for the SW Florida real estate market is price at market value and buyers will come.

Pending sales were up 2.2% in June which should lead to some nice closing numbers going forward.  However, if you look at the pricing trends for the past few years, you will notice prices have not moved much.  Every year around May or June home prices are lower, primarily because the larger sales happen in season.  2020 was different because season was interrupted by covid-19 and we were under a stay-at-home order in April.

Price at Market Value and Buyers Will Come

Price at Market Value and Buyers Will Come

What is selling today is pretty much anything that is priced correctly.  We are selling low, middle, and high-end homes.  The key is, buyers are looking for housing amongst low inventory, but they don’t want to overpay.  Buyers never want to overpay, and sometimes it seems like they must in low inventory markets.  We do think there has been some upward price pressure, but we are not seeing it yet in the overall numbers.  We may see it in the June or July closings when those numbers are released.

Sellers must weigh to counterbalancing ideas.  One is you have got a hot commodity in a lower inventory market.  The other is you don’t want to be greedy and miss this market.  Inevitably some sellers miss a seller’s market because they get too greedy and think the hot market conditions are going to last forever.  These sellers always say, “I wish we had that hot market back” when they own their home 4 years later but wished they had sold 4 years ago.

We can sell a home in a hot, warm, or cold market.  The fact is some sellers succeed while others fail to sell even in the hottest of markets.  It is always nice to sell in a hot market, and it stinks to miss it because you thought it was going to go even higher.  It’s happened before, and it will happen again.  The question is, is it going to happen to you?

Market Where the Buyers Are

The other key ingredient is knowing who your market is and knowing how to reach them.  We’ve had great success with out of state buyers, so we’ve marketed out of state.  You have to go where the buyers are, and the Ellis Team knows how to do that.

Our listing inventory has shrunk because we have sold most of it.  Sure, we have new listings coming in all the time, but not as many as we are used to marketing.  If you have a property to sell, you might want to give Brett or Sande Ellis a call. 239-489-4042 Ext 4. We have over 3 decades experience marketing in changing markets, and we’re definitely experts at reaching buyers where they are.

The Ellis Team has been voted Best in Real Estate for 5 straight years in the News Press Reader’s poll, and that does not happen by accident.  We’d like to sit down and discuss your goals and see if we can make your goals a reality.  It all starts with an idea.  Some ideas are available right now, especially since rates are so low.  Chances are you might qualify for more home for less monthly payment than you have right now.  Other ideas might take some planning, but with expert help we can put your ideas into motion and make that next step a reality much sooner for you.

Curious About Selling?

If you are simply curious about your home’s value. Check out www.SWFLhomevalues.com You can check on your home’s value without having an agent out to your home.  This preliminary step might help get the wheels turning for you.  Of course, Brett and Sande are just a phone call away if you need us.

Good Luck, and Happy Selling!  Call us if you need us 239-489-4042 Ext 4

See last week’s article “Advantage Southwest Florida Sellers as Sales Outpace New Listings

For months we have been telling you about strong real estate sales and dwindling inventory.  If our local market were a tennis match, we would say advantage Southwest Florida sellers as buyers are scooping up properties faster than new listings are entering the market.

Advantage Southwest Florida Sellers 7 Day market Watch

In the past 7 days 551 homes went pending in Lee County while only 294 new listing came on the market.  This is a daily trend, and it has been happening for months.

If you are a seller, this is a great time to sell.  You have far less competition from other sellers.  In fact, buyers are no longer in competition with the seller, but rather all the other buyers trying to purchase the same property.

Pricing is still key.  Just because it is a seller’s market does not mean buyers will overpay.  Of course, the bank appraiser will also have a say in it too.  The other way to look at it is this way.  Why would you want to overprice a home and miss one of the greatest opportunities in years?  While we expect the real estate market to do well into the future, you may not have inventory levels this low again.

Advantage Southwest Florida Sellers

Advantage Southwest Florida Sellers Months Supply of Inventory

No matter the market, we always see sellers that miss the market.  When it’s going well, they overprice it and expect the market to catch them.  When it’s on the way down, some sellers chase he market down and never quite get there, so it sits.  If they do have to sell, it can cost them.

We like to sit down with sellers and discuss their options.  We can discuss proper pricing strategies along with how our marketing is reaching out of town buyers.  What do you do when there are layoffs in town?  You go find buyers out of town, and our marketing is doing that.

Targeted Online Real Estate Advertising

For instance, last weekend we ran an online ad.  We had signups from 8 local buyers, and from 35 out of state buyers.  Add that to the 20 open house attendees and we created 63 interested parties in one weekend.  It is no wonder we are close to selling that home at the time this article is written.

Marketing must be geared to where the buyers are, and you need a Realtor who thinks out of the box to reach those buyers.  There are lots of buyers in SW Florida.  You just have to know how to reach them.  There are lots of buyers nationwide.  We know how to reach them.

Brett and Sande have the data to help you make the best decision for your family.  We do not like to under-price a home.  You do not need to in this market.  We can show you how to get Top Dollar.  If you have more buyers and more offers, you have a greater chance at top dollar.

When you overprice your home, you may get little to no offers, and that would be sad.  If you’re wondering what you’re home is worth and just want a quick analysis, you can go to www.SWFLhomevalues.com.  It will tell you instantly what your home is worth and how confident the value is.  You can then call Sande or Brett and we will tell you if we agree.  239-489-4042 Ext 4 

This weekend is Independence Day.  Enjoy this day, and this weekend, and remember those that fought to make this day possible.  It may also be Independence Day for your home.  You may now have enough equity to make the move you have been wanting to make.

Home values have been on the move.  Inventory is low.  Call Brett or Sande and let us see if a move is in the cards for you!

See last week’s article “Real Estate Transaction Dollar Volume Drops 43% in May

It is no surprise that real estate transaction dollar volume dropped in May.  May closings were a result of March and April pending sales which were impacted by covid-19 and stay at home orders in Florida.  Going forward, new pending sales have been strong, and top agents are having an exceptionally good year.

Real Estate Transaction Dollar Volume Drops in May

Dollar volume is the number of transactions multiplied by the average sales price.  That number dropped from $569.1 million last year to $326.0 million this year.  That is significant.

One of the things holding down sales is the limited inventory.  The other is travel has been limited during this period from other states.  That is not to say the motivated didn’t find a way to get here and purchase, but it did limit many.  Properties at the lower to mid end have been doing well.  Because of this, it has pulled the median price down .7% and the average price down 6.2%.  I would not say prices are falling though.  Right now, it is more of the mix of properties that are selling that is causing this.

We have seen this pattern before.  When real estate transaction dollar volume drops, it is not long after that agents start looking for the exit door.  These agents do not head directly for the door, they take a detour.  First, they are attracted to low cost brokerages with higher splits and fees based per transaction versus monthly.  It is an attempt to salvage their fledgling real estate career, and it does not work.  They were struggling before the crisis, and the real estate transaction dollar volume drop exacerbates it.

The detour is simply a speed bump to slow down the inevitable.  The exit door is approaching.  Sellers should be leery of listing with an agent who does not have listing transaction experience and has not had recent sales.  One question you might ask is, how long you have been with your current company?  Another would be how have your sales been in the last two months?

If you are considering selling, we have a list of questions you should ask the Realtor you are interviewing before you sign any agreement.  Another tell tale sign is when they agree to cut their commission.  This tells you two things.  Number one, they need a deal badly, and since profit isn’t a predominant factor, survival is, they may not be around by the end of the transaction.  Secondly, if they cannot negotiate their own transaction, how in the world can you trust them to negotiate on your behalf? Lastly, if they say they can do it for less, you must wonder if they’re spending money marketing your home, or just relying on the price and MLS to sell it.  If they don’t do anything for you, why pay them anything?

The whole point of using a Realtor is because they put more money in your pocket at closing than selling By Owner does, and that is a fact.  Realtors spend money, and each has their own value proposition.  If their value proposition is dropping, it means their value to you as a seller is dropping too.

Before you shortchange yourself and hire the least expensive agent you can find, call us, and explore the difference.  If netting more in your pocket at closing is more important than the low fee you pay, we need to talk.  Most people believe the less cost you pay the more money should flow to your pocket, and that makes sense.  The only problem is it is not necessarily true.

Brett and Sande will answer your questions and show you how we are able to get more money for our sellers.  In times like we are in today, experience matters.  Put the experience of Brett and Sande Ellis to work for you.  239-489-40402 Ext 4 or email us Brett@topagent.com or Sande@topagent.com

We’re excited to talk to you!  Good luck and Happy Selling!

See last week’s article “Hurricane Damage Roof Claim Settlement Deadline Approaches

Ellis Team Open House

Open House Sunday 1-4 PM

14120 Reflection Lakes Dr

New Listing in Reflection Lakes
Open House Sunday 1-4 PM

 

 

SW Florida homeowners need to be aware that the hurricane damage roof claim settlement deadline is approaching for Irma claims September 10, 2020.  We are at the three-year mark for such claims.  You do not need approval of your claim, but your claim does need to be submitted to your insurance company by that date.

Hurricane Damage Roof Claim Settlement Deadline

Hurricane Damage Roof Claim Settlement Deadline

Here is what is so important about this.  Many people had roof damage and do not realize it.  When they go to sell their home, it will come up on a roof inspection.  The seller will be required to make the repairs or put on a new roof if the roof is not repairable.  Many roofs are not repairable because the tile system on their home is not made anymore, or because the percentage of damaged shingles is too significant.  In that case, a new roof may be required.  Many tile roofs cost over $50,000.

If an insurance claim is filed and not closed it would be on record and the new buyer might not be able to obtain insurance.  Choosing a roofer with extensive experience dealing with insurance companies is a must.  The attorney they work with when the insurance company says no the first time is important too.  Filing a claim is a big decision and should be done if you have damage, but you need to be prepared to follow through because the insurance company will not just hand over the money.

There is a lot of disinformation on the streets.  You must be careful not to listen to the roofing salesman. We have heard some whoppers and not all of their claims are true.  For instance, the homeowner will have to pay the deductible.  Insurance companies reserve the right and will go back and verify later that the deductible was actually paid.  Some roofers entice homeowners to choose them because they scheme up ways to avoid this and the homeowner thinks they are going to get a free roof.  This is insurance fraud, and it could come back to bite the homeowner.  Yes, the roofing company may be committing fraud too, but when they are out of business it will not matter to the homeowner who also committed fraud.

Roof May Determine Sale Ability

The bottom line is if you’re thinking of selling during the remaining useful life of your roof, you should have it checked. If there is damage you may not be able to sell your home with the damage.  You also want to use a reputable roofer who knows what they are doing, backed by a competent attorney who also knows what they are doing.

If you need the name of some roofers we’ve had good experience with, we would be happy to supply them to you.  Simply call Brett Ellis 239-489-4042 or email Brett@topagent.com and we’ll pass along the information.

It may be possible to sell the home if the damaged work in the claim was repaired.  We can submit that info to new insurance company and coverage can be bound.  We work with some excellent insurance companies. That is the other end of the equation people do not always think about.

New Roof May Increase Home Value

It pays to work with experts in their field.  When you have a home under contract it’s sad to lose the deal over something that could have been prevented.  A new roof may help improve the value of your home too.

Buyers consider the price of a home combined with all the improvements, upgrades, and maintenance items they’ll have to make.  The more repairs and maintenance items eat into what they will offer for a home, if at all.  Maximizing your bottom line is a consultation between you and your Realtor.  An experienced Realtor can guide you to help you make best decisions.  Mistakenly, some sellers believe hiring the cheapest agent they can find will save them money. In fact, this strategy may cost them thousands.

If you want to save thousands on your next sale, ask Brett or Sande how we can save you money. Besides our experience, we have some programs that save our clients thousands of dollars.  It pays to know what they are. Call us at 239-489-4042 Ext 4 or visit www.SWFLhomevalues.com to find out how much your home is worth.

Have questions?  Brett and Sande are here to help!

See last week’s article “Changing Real Estate Trends We Are Watching

We thought you would like to know some changing real estate trends we are watching and how we are adapting.  This is only the 2nd time in my 30+ years in real estate I can remember changes so significant like we are seeing today.  The trends we are seeing today are different than normal economic cycle’s ebb and flows.

The last changing real estate trends we saw was back on 9-11, 2001 The United States was rocked by an enemy.  The country banded together, and Americans decided it was safer to nest at home versus travel abroad.  So, they did.  People hunkered down, traveled to within driving distance of their home and made home renovations, because home is where they were going to enjoy life and their family for a while, if anyone in Australia is requiring a reliable renovation specialist then you need an accredited and fully insured home renovation builder in North Brisbane to start your project.

Changing Real Estate Trends

Today, we are seeing similar tendencies.  Cruises, airline travel, and International travel are scary to many considering covid-19.  Workers learned to work from home, and companies learned it’s feasible.  Once companies learned this, they also learned they can save on high cost lease space in the city and setup shop in either the suburbs, or far away from where they originally thought they must be.

Two things happened.  Workers realized if they could work from home anywhere, why be in the city, and why be in high tax states?  Why not move to warmer climates that are tax friendly?  Not long after that, companies realized the same things.  If our workers are moving, why couldn’t we?  Companies have been reluctant to move for fear of displacing so many workers and not having talent in the location they might move to.  With them the need for commercial property maintenance arose. Considering the facts the companies are trying to explore their options and trying to bring the right change.

Then another thing happened; the unfortunate death of George Floyd, the protests that ensued, and more specifically, the riots and mayhem.  Combine this with talk of disbanding police departments and it sent some companies over the edge.  Companies like steady, predictability. Chaos and mayhem are not business friendly.  The thought of closing stores, losing inventory, and putting employees in harms way was too much to stomach, and many businesses are leaving.  It’s not good business practice to operate in unstable environments.

This is also a reason why some companies are relocating from China back to the US; predictability and stability.  So, who benefits and who loses in such a scenario?

Florida is Attractive to Buyers

States like Florida are big winners.  Florida has done well with covid-19.  Riots have been well contained in Florida and leadership at the state and local levels have been strong.  Sure, some will always disagree with this stance or that, but leadership itself has been strong.

Consumers are looking to migrate out of cities and move to suburbs, smaller towns as well as rural. RV sales have picked up tremendously.  RV dealers are practically sold out in some cases.  I checked with an RV dealer locally who confirmed sales are off the charts and they are having a hard time keeping inventory.  Sound familiar?

Gun sales have increased.  People are worried they may rely less on the government for protection.  The events of 2020 may shape real estate decisions in a way we have not seen since 2001, and this time it appears to be more dramatic.

People crave predictability and stability.  Companies do too.  When they do not have that, they take control to the extent they can, and that’s their family’s personal safety and housing.

Changing Real Estate Trends We are Watching

Shifts in Advertising

We have shifted our advertising.  We still advertise locally, and we are bumping up our advertising into areas where we know people are migrating out.  It is working.  We have buyers coming in from all over.  Our artificial intelligence can identify where buyers and referrals are coming from for any city.  For example, here is the map for incoming referrals to Tampa.  Each city has its own patterns.  Hire us and we’ll put the SW Florida data to work for you.

The Ellis Team is forging relationships with top agents in each of these cities, as well as taking out targeted ads directly to buyers in those cities.  They are coming here and buying.  Our team sold 3 homes last weekend to leads we have been working using targeted ads.

If you are thinking of making a move, call Sande or Brett Ellis 239-489-4042 Ext 4, or visit www.SWFLhomevalues.com to see what your home is worth, or www.LeeCountyOnline.com to find your next home.

See last week’s article “Agent You Choose Matters When Listing Your Home

Agent You Choose Matters When Listing Your Home

Ellis Team Open House

Today, more than ever, the agent you choose matters when listing your home in SW Florida.  Pending sales are down 7.1% year to date, and down significantly in March and April.  Obviously, the economy took a big hit from Coronavirus, but that is no excuse to sit back and do nothing.

One thing we know is when pending sales take a big hit, closed sales will fall in the coming months.  When closed sales fall, agents get out of the business.  The agent you are thinking about hiring to list your home may be hanging on by a thread and may not make it to closing.  Furthermore, even if that agent has a side gig and can withstand a sales pullback, they may not have the experience to guide you through a shifting market.

Agent You Choose Matters When Listing Your Home

Agent You Choose Matters

Our team has been through several shifts, so we know what to do.  In times like this, you work harder, and your experience pays off for clients. Ellis Team sales are up year to date, as are a few other experienced agents we talked to.  But for the most part, agents will feel the brunt of the pending sales slowdown.

Believe it or not, even though pending sales are slower, pending sales are outpacing new listings about 2 to 1.  This means it can be a good time to sell.  While new pending sales were down 36.9% in April, listing inventory is down 22.9%.  We believe the month’s supply of inventory will go down.  Officially it stands at 4.3 months in April, even though we had it falling to 4.2 months back in March.  For April we have it at 3.85 months supply.  This puts us firmly in a seller’s market, which means an experienced agent should be able to get you Top Dollar and get your home sold fast.

Speaking of fast, in April the median time to contract was 48 days.  Contrast that with April 2019 when it was 71 days.  That is a 32.4% reduction in time to sell a home.

Thinking of Selling?

If you are thinking of selling, you should talk to Brett or Sande Ellis 239-489-4042 Ext 4. Brett and Sande have the experience of selling over 5,000 homes in SW Florida and have been through several market cycles.  This market cycle is different than others.  One thing we know about shifts, and this is true no matter what the cause, they happen gradually then suddenly.  When markets shift, buyers and sellers have fear.  Fear causes people to pause or do strange things.  It is not strange at all when you realize what is happening.  It takes skill and trust to turn that around.

Brett and Sande have the skill and trust of buyers and sellers.  Because we have experience, our deals are more likely to close, and when problems arise, we know ways to keep them together.  Quite often the buyer still wants to purchase, and the seller still wants to sell.  We simply must overcome the obstacles the lender or the parties put before us, and this leads to a successful transaction.

Marketing is also key.  Many agents will tell you it is all price.  Price is important, but so is marketing.  We have had great success marketing into northern markets and pulling buyers.  Every shift presents obstacles and opportunities.  We prefer to focus on the opportunity, and when we do that, the obstacles seem to melt away.  Let us show you how we are attracting buyers with our marketing.

Of course, we must also price your home correctly for the market.  No amount of marketing is going to overcome and overpriced listing.  If you have a home that failed to sell in the past, let us take a look at it.  Today’s low inventory, proper pricing, and our marketing might just be the winning formula to get you on to your next venture.  We are experts at making dreams a reality.

Find out what your home is worth for Free at www.SWFLhomevalues.com

And remember, the agent you choose matters when listing your home.

See last week’s article “Rising Home Sale Price Trend Continues Despite Pandemic

2020 has been a good year in real estate for buyers and sellers alike.  Both have benefited for different reasons.  The rising home sale price trend continues despite pandemic concerns.

Year to date median home prices are up 5.6% and averages home sale prices are up 9.8%.  Most experts did not know how the shutdown was going to affect real estate sales or prices for that matter.  Busy Realtors on the front line saw a developing trend and we reported it to you as it became apparent.

Rising Home Sale Price Trend Continues

Rising Home Sale Price Trend Continues Despite Pandemic

Quite frankly, we were not surprised and in fact predicted this, because we have seen similar events in the past shape consumer behavior.  If you read our weekly article, we have talked about 9-11 and how that changed people’s travel and home buying preferences.  Covid-19 may be a similar such event with similar results.

Interest rates are low which is helping home buyers.  We are seeing more financed deals than cash deals.  For instance, closed deals were down 14.1% in April.  Cash deals were down 39.3% For people that have jobs, they are financing.  Another boom down the road will be homeowners who refinanced.  Those homeowners will have more disposable income in their pocket after this is all over which may help the economy going forward.

The economic stimulus is not all out and in the hands of the people yet.  Some are predicting a v-shaped recovery, while others predict a u-shaped.  A few predict a w-shaped, and this is what we don’t want.  We believe the 3rd quarter will be robust compared to 2nd quarter, and the growth rate will set all-time records.  It will not bring us back to pre-covid 19 levels, so people should not read the headlines and think the economy is all the way back.  It may take years before it’s all the way back, and yet recovery will be welcomed.

Housing inventory is down 22.9% from last April, and we have noticed an uptick in sales activity in May.  These numbers will not be reported yet for another month, so you’re getting inside information early.  It pays to know a busy Realtor on the front lines.

Some speculate that with near 20% unemployment, home sales and prices must go down.  This would be true if we had excess supply.  We simply do not right now.  With record low interest rates, and people going back to work, we may not have the opportunity to slide much, if at all.

All real estate is local.  Not only are we seeing buyers coming in from out of state to escape regulations and living conditions where they are, we are also seeing it in-state buyers.  While inventory is shrinking here, it’s also shrinking other places in Florida.  We are seeing more people coming over from Miami area and purchasing here, which is putting further pressure on inventory.  We saw this back in the boom.  The only difference today is we do not have an over-supply of homes like we did back then.

Our Office is Moving

Keller Williams and the Ellis Team office is moving south on Summerlin.  Our new address is 12840 University Dr in South Fort Myers.  It is located directly across from FSW college.  This is kind of like old times for the Ellis Team as were in a nearby office on University Dr for years with another company before moving to Summerlin Lakes Dr, and eventually over to Keller Williams.  We look forward to seeing past and future customers at our new location.

Our team and company are growing.  We might be the only real estate company expanding right now, and that’s because our lead generation and technology are second to none.  If you have a home to sell, please call Sande or Brett Ellis at 239-489-4042 Ext 4 or visit  www.SWFLhomevalues.com for a free analysis of your home.  You can tell us how accurate you believe it is.

If you’re looking to purchase, visit www.LeeCountyOnline.com The information is updated in real-time, so you’ll never miss out on new listings or price changes.

We are moving this weekend to better serve you.  Make your move with the Ellis Team at Keller Williams Realty.  Knowledge and experience matter in changing times.  Put our experience to work for you.

See last week’s article “Buyer Beware Listing Inventory Disappearing Quickly

We have been reporting for weeks that pending sales have been outpacing new listings.  See last week’s article “Housing Inventory Falls in May” We entered 2020 with low inventory and since the Coronavirus outbreak it’s only deepened.  It’s time to issue a warning.  Buyer beware listing inventory disappearing quickly.

Many people watch the news and speculate that homes are not selling.  The truth is homes are outselling new listings by a 2 to 1 margin.  In the last 24 hours we had 84 pending sales and 39 new listings.  It’s a similar story the past 7 days, and the last month for that matter.

Buyer Beware Listing Inventory Disappearing Quickly

Buyer demand is strong.  Realtors are on the front lines, so we hear the stories every day.  Northern buyers are flocking to Florida and buying property.  They are either buying a 2nd home and moving here to escape quarantine, or more predominantly they are escaping what they see as repressive government overreach and leaving their state entirely.

If business owners pull out of those states some of those jobs will never return.  Others are deciding on early retirement and getting out of Dodge.  You can only lockdown people for so long before they feel they need to make a change.  States like Florida and Texas are particularly attractive for a few reasons.

Both states have had far less mortality rates and fewer hospitalizations than other states.  Buyers feel as though states like Florida and a few others have been better managed through the crisis.  Secondly, Florida and Texas offer no state income tax.  Before Coronavirus people were already fleeing high tax states like New York, New Jersey, Illinois, etc.  Low tax states like Florida helps seal the deal for business owners and higher end employees seeking relief from high taxes.

The other thing we have learned through this pandemic is people and businesses are re-thinking work models.  More companies have allowed work from home, and employers and employees alike have gotten used to it.  Now that its viable, companies are questioning if they need high lease space commercial properties or if they can get by with less expensive space out of the bigger cities.

Financially it may be an easy choice for employers, and even easier for employees.  Add in the pandemic and there is a propensity to escape densely populated areas to more rural areas.  When you combine financial concerns with health concerns, more employers and employees are choosing to get out of the big city, even if it means quitting a job, or closing a company.

We believe over the next few years companies will start migrating out to flex space in the suburbs, and out of high tax states altogether.  As more people leave those states, it will place a higher financial burden on the fewer remaining to carry a higher tax load, and they will eventually leave too.  It’s like a chain of events that began a few years ago with America’s economic revival and it’s picking up steam today due to Covid-19.

Buyer Beware Listing Inventory Disappearing Quickly

Our advice to buyers is select a property that meets your needs and lock it down.  We are down to about 3.85 months supply of inventory and going lower every day. We were down to 4,440 single family homes on the market in Lee County Mid May, and if this pace keeps up, we’ll be down in the 3,000’s by June.

If you are a seller, there is no better time to sell than right now.  We are seeing properties that did not sell in season suddenly sell because they are the next one up.  If you are a buyer, you need a realtor that knows how to write a winning offer, and that takes experience.

If you are a seller, you need a Realtor with experience dealing with multiple offers, or the wisdom to know when to wait for a better offer that might be just around the corner.

Neither side should wait.  Interest rates are low, and there are compelling reasons for both sides to act quickly.  Call Brett or Sande Ellis 239-489-4042 Ext 4 to discuss your sale, or visit www.SWFLhomevalues.com to find out what your property is worth instantly.

Buyers, we have a system that will alert you to new listings the minute they hit the market.  We can also tell you about new listings we might be working on.  We’re here to help.

Happy Memorial Day!

SW Florida housing inventory supply falls to 3.85 months, down from 4.20 months supply back in March.  We do not have official April sales numbers, but a quick search of single-family homes in our MLS shows 1,116 closed sales in 2020 versus 1,361 in 2019.  That is a 18% decline in sales in our MLS.  So how did the months of supply go down?

Housing Inventory Supply Falls in May

Housing Inventory Supply Falls in May

Heading into the Coronavirus crisis inventory was light to begin with.  Sales picked up in the $300-$600k category and declined in all others.  Inventory increased in the under $100k category and declined in all others.  Keep in mind, these numbers are from previous 365 days from each point in time.  365-day sales were down 1.96% while 365-day inventory was down 10.16%

We can determine that months supply of inventory is down because there are fewer home sellers.  It is also possible that we have less home sales because there is less inventory, which means there is less opportunity for buyers to choose from.

We have seen more sellers step up and decide to place their home on the market, and yet the listing numbers are still down.  This tells us it is an absolute perfect time to sell because there is less competition from other sellers and buyer demand is still good.

Speaking of buyer demand, we see several key factors in play and right now one is winning out.  Locally, we are seeing layoffs and business closures.  This was to be expected due to shut down. Some businesses just could not survive this.  The other thing locally we have found is many people who still have their job but were renting have decided they want to buy.  They were shut in on quarantine in a place that wasn’t their own, and they did not love.  Many want a larger space and moving forward we’re not sure the virus is going away anytime soon.

Northern Buyers Heading to Florida

Secondly, many people up North do not agree with shutdown orders of their businesses and lifestyle and they are deciding to purchase in Florida.  They may not like the fact they live in a high tax state, and now with onerous restrictions, they have had enough.  Florida is one of the places they want to be now.

At least three factors are in play, and two are winning out favoring real estate sales in Florida.  Our team has been advertising in markets up North and we are generating a lot of buyers looking to relocate to Florida.  Some of them are Now buyers, meaning they are not waiting until they retire.  They want to purchase now, and covid-19 and the reactions to it is the impetus for their immediacy.

If sales declined 18% in April, our team’s sales did not. This suggests some agents are being aggressive  finding buyers for properties while others may be sitting home wondering what they can do.  Brett and Sande have been involved in real estate in SW Florida through many shifts.  The reason for this shift is different, and yet all shifts are alike.  They tend to come suddenly, and how you act and market in a shift matters more then when times are great.

Aggressive Agents Have Strong Sales Right Now

A great market hides a lot of imperfections because sales seem to find the agent.  Not all agents survive in a shift, as many are exposed as order takers instead of marketers.  High tide lifts all boats, and often masks other issues.  Low tide reveals who has the grit, knowledge, and determination to get the job done.  You must survive to thrive.  Surviving means performing, and performing means serving your clients at a high level and educating them.

If you enjoy reading this column and you’re thinking of buying or selling in SW Florida, please reach out to Brett or Sande 239-489-4042 Ext 4 or visit www.SWFLhomevalues.com  to get an instant value on your home.  You can search homes there too.

Sande and Brett are here to give you advice on if now a good time for you to make a move and talk about how the process would work.  If you’re a buyer and do not have a property to sell, visit www.LeeCountyOnline.com We look forward to helping you!

See last week’s article “If You Could Work From Anywhere Where Would You Want to Be?