We thought you’d like to see the 2024 housing inventory supply numbers as we start off the new year. Everybody asks, are we in a buyer’s or seller’s market. This data gives us our answer.

2024 Housing Inventory Supply

Buyers Market?

A seller’s market is anything less than 5.5 months and a buyer’s market is anything over 5.5 months. Currently the Lee County single family 2024 housing inventory supply stands at 5.05 months supply, which keeps us in a seller’s market.

It might feel like a buyer’s market only because of the change we’ve seen in 2023. Back in October we reported a 4.19-month supply, and in July 2023 it was 3.81. In February 2023 it was 2.81. As you can see, the market moved steadily towards a balanced market in 2023 where neither the buyer nor seller had the upper hand.

A few points to remember. I pulled this data January 2nd. Typically, I wait 10-15 days for all the end of the month sales to come in. By MLS rules they are supposed to be entered within a few days, but I allow for more time. Secondly, there were 282 expired single family home listings in Lee County from Dec 31-Jan 2nd. Many of these homes will be relisted and added to the inventory totals, which will tilt closer to the balanced market or seller’s market should that occur.

Buyer Activity Increase

We have seen an uptick in showing activity the week after Christmas. This often happens, but it did not last year, for obvious reasons. The fact that mortgage rates have declined, and people are visiting SW Florida again, causes us to be optimistic. We expect interest rates to decline slightly in 2024 and more into 2025.

An uptick in pending sales may offset the expired listings that may re-enter the market in the coming days. Currently we are tracking about 902 closed sales in December compared to 955 in 2022. As we mentioned, all sales may not be entered yet. Either way, we are expecting a decline in year over year sales in December which was par for the course in 2023. We’ve been tracking 2018 closed sales levels closely since May, and in 2018 we closed 901 single family home sales. We feel pretty confident in these preliminary numbers.

December Sales Numbers

Preliminary sales numbers suggest a December median sales price of $400,000 which would be down from December 2022. All signs point to declining home sales and declining home prices for December 2023.

Just because home prices might be down in December doesn’t mean they will stay there. In 2023 interest rates were rising. Recently rates began declining, which could stabilize the market, or infuse fuel to the market in 2024. We do not expect large interest rate swings in 2024. What we do not know is how many sellers will decide to sell in 2024. We saw a steady rise in sellers in 2023, and we anticipate a rise in buyers in 2024. The answer to both ends of that equation will answer for us where this market goes.

In the coming month or so we will finalize where our market ended in 2023, and that is important to track. What it does not tell us is where the market will go in 2024. We believe this will become apparent in the next 8-10 weeks. As always, the Ellis Team will keep you updated.

Thinking of Selling?

If you’re thinking about selling, give us a call today. 239-310-6500. Brett and Sande Ellis would love to talk to you about the market, your neighborhood, and what options you have. The most common questions we get are what could we sell the house for now in its present condition and what could we get if we made some improvements? The other is when is the best time to sell? We can help answer those questions.

If you’re just curious about your home’s value, you can get an instant online value now at www.SWFLhomevalues.com.

Happy New Year! Always Call the Ellis Team at Keller Williams Realty with your real estate questions. 239-489-4042

See last week’s article “Property Best Buy List

Ellis Team Weekend Open Houses

Open House Saturday 12-3 PM

8815 Oakshade Cir    $325,000

Ellis Team Open House January 6th
Open House Saturday 12-3 PM Whiskey Creek

Open House Saturday 12-3 PM

4431 Bay Beach Ln Unit 544     $525,000

Fort Myers Beach Ellis Team Open House
Open House Fort Myers Beach Saturday 12-3 PM

Open House Sunday 12-3 PM

14386 Reflection Lakes Dr    $400,000

Reflection Lakes Ellis Team Open House
Reflection Lakes Open House Sunday 12-3 PM

 

 

Welcome to the Ellis Team property best buy list for SW Florida real estate. The Ellis Team has been a leader in SW Florida real estate sales for over 35 years and knows a good deal when they see one. We’ve sold over 5,000 homes locally in SW Florida.

Property Best Buy List

 

Property Best Buy List Qualifications

 It wouldn’t be a property best buy list if any property could make the list. To qualify to be on the Ellis Team property best buy list a property must be deemed a best buy by one of our associates.  Several criteria are used to earn this designation. We look for outstanding value and features. A home may be the least expensive home in a neighborhood but doesn’t necessarily have to be. A home could offer an unbelievable number of features compared to nearby homes or be located on a lot that cannot be duplicated and therefore exemplifies value by its unique nature and price.

Best buy properties would be properties that either our team has showed or previewed for specific clients or properties that score well on paper. This does not mean that our team has inspected the property or warrants the value in any way. There could be many factors including condition, title, permitting, etc. that we wouldn’t be aware of unless a buyer completed the home investigation process. On paper, or at first glance, we’ve identified properties that appear to be of great value and warrant further investigation.

Who Gets the Best Buy Property List?

Nobody gets the entire list. This list is developed internally by Ellis Team members and is meant to assist buyers utilizing our services. We listen to a buyer’s needs and select homes from MLS and our internal list that meets those needs. There wouldn’t be a reason to give access to the entire list because it would not meet every buyer’s needs and would have properties in all price ranges.

What Types of Property Makes the Best Buy Property List?

We have vacant land, single family homes, condos, and residential income properties that qualify to make the list. If we have absences in a category, it simply means we haven’t identified a best buy for that category today. It’s possible we just took some off the list because they recently closed or went pending. New properties could enter the market tomorrow, or an existing property could make a significant price reduction that it now qualifies to go on our list.

When a property is overpriced, it is invisible to buyers most likely to buy that property. When a price reduction occurs, the property becomes visible to more buyers, and in some cases, could be deemed a best buy.

If your home is on the market with another Realtor, don’t call us to see if your home is on the list. Your home may be a best buy, but the list is for Ellis Team clients, and we will not share if your home made the list or not.

What the List Is Not

Our list is not comprehensive. We have not been to every property, and we have not studied every property in SW Florida. We are constantly scanning for new opportunities.  Our list are properties that meet our criteria and properties we have shown or noticed through searches. We may compare these properties to similar nearby properties and/or utilize computerized valuation models. Either way, our internal list is a model that suggests a property might be worth checking out.

Buyers

If you’re interested in purchasing a home for a good value, check out www.LeeCountyOnline.com. You can register and one of our buyer specialists can listen to your wants and help you find a best buy.  Or you can search on your own for Free.

Sellers

You can go to www.SWFLhomevalues.com and get your home’s online value for Free. We have additional valuation models for your home as well that we can email you. All you have to do is ask.

The Ellis Team is active in the market and shows or views homes practically every day. We know the market, and if you’re looking for a Best Buy, we can help you learn the market too.

Good luck, and Happy New Year!

Have you heard about these buy now refinance free later offers lenders are offering?  Do they make sense? Let’s explore what these are and if they make sense for you.

Buy Now Refinance Free Later

Is the refinance later part really free? It depends on how you look at it. If by free you mean no cost to the borrower and the rate and payment goes down, then yes, it is free. Could the borrower receive an even lower rate if they paid their fees, the answer is yes. So, in a sense, it did cost the borrower versus the rate they could have gotten.

Buy Now Refinance Free Later

Let’s break it down. There are closing costs associated with financing or refinancing a home. There is a possible appraisal, title insurance, doc stamps on the note, and intangible tax on the note. These fees must be paid somehow. The lender can pay them for you, but they typically roll them into the mortgage rate, or what they call the spread.

This cost could equal as much as half percent to three quarter percent in the rate from the lender I asked. Let’s say you have a 7.5% mortgage on your current property. Rates go down to 6.5%. If the cost for a no closing cost refinance is half percent, you could refinance your current rate of 7.5% down to 7% and it wouldn’t cost you anything. You’d be wise to take that deal, wouldn’t you?  And if rates went down to 6%, you could do it again and receive a new refinance of 6.5%, and it wouldn’t cost you anything.

You could keep doing this every time rates went down. Perhaps this is why refinance applications are up 7.6% this week over last week. Homeowners are refinancing their existing rates and saving money. For anyone that purchased in the last year or so, this could be an excellent strategy to save money.

Pro Tip Strategy

When rates begin dropping it will create more buyer demand. Right now, buyers have excellent choices in housing, and sellers are more willing to deal or pay concessions this year than last. Once buyers flood back into the market, sellers will be less accommodating.

Wouldn’t it make more sense buying a home today with excellent inventory options rather than fighting more buyers down the road for the best properties? Once you’ve secured your home, you’ve locked in your housing costs. The landlord cannot raise your rent and housing prices won’t go up for you because you’ve already purchased. If the rate goes down, you can refinance it at no cost to you. If rates go up, you’re locked in.

How to Finance

Should you take the offers I’ve heard on the radio that say buy today and we’ll refinance you for free down the road? The lender is either putting building costs into your rate now, in which case you’d be paying a higher rate today, or they’ll add it later.  I would not select the added cost now if I were purchasing. Personally, I would wait and just deal with it later. What if rates don’t go down enough, soon enough? You paid extra money upfront for something you may not use. The costs are the same, so why not pay it when you use it? And, as we discussed, are you really paying it if you receive a benefit later and it costs you nothing to lower your payment?

Always Call the Ellis Team

We have lenders we work with that can help you make the best decision. If you want, we can offer advice too. We are not loan officers, but when we hear your story, we can help guide you to the lenders that have good choices for you.

Why Wait?

Financially, we don’t see a reason to wait for rates to come down. While you wait for rates to move lower you face increased competition from other buyers.  We have a limited window to take advantage before other buyers figure this out. Give us a call at 239-489-4042 and get a jump on the competition, and lock in your housing costs. Once we do that, things can only get better. You won’t be at the mercy of your landlord, interest rates, or other buyers bidding against you.

Search the MLS like a pro.

The Ellis Team has Two Locations to Serve you. Call us first so we can make sure we have someone to help you.

Fort Myers

12840 University Dr

239-489-4042

Cape Coral

3208 Chiquita Blvd S

239-540-9070

 

The Ellis Team Current Market Index predicts future real estate pricing accurately by analyzing key data that influences the direction of the market. Back in 2003 we were able to predict the market would take off, and it did.

2005 Warning

In October 2005 we warned people the market was about to turn. I remember doing a lengthy article on NBC where we tell people the end of the bull market is near. We all know what happened after that.We will work to find that story and upload to our YouTube Channel.

Agents told us back then we were crazy. This was a runaway bull market, and it couldn’t be stopped. People were flipping houses and making $100,000+ per house. They couldn’t, nor did they want to see the data that was driving the market. Back then we advised Ellis Team clients to stop buying, even though it cost us commissions. We could see what was about to happen because of our index.

CMI Predicted Bottom in 2009

We knew the market was on its way to stabilization in 2008. In 2009 we called the statistical bottom of the market, even when prices were about 30% of what they were a few years ago. View the CMI Index back in 2009. Again, in 2009 people thought we were crazy calling the bottom of the market. We wrote several articles back in 2009 and went on WINK TV telling everyone the bottom was here, but people didn’t believe that either. People tend to follow the crowd and believe where the market has been rather than where it is going.

Current Market Index Predicts Future
Current Market Index in 2009

 

The point is market outcomes have more to do with data than they do with emotions. Buyers today want the market to fall. Sellers want the market to rise. The market does not care what anybody wants, it rises and falls because of the data. The trick is learning which data to use and how to interpret it.

Ellis Team Current Market Index Predicts Future Real Estate Pricing

The Ellis Team current market index currently sits over 4.3. We no longer publish this index publicly as we keep it for paying customers of the Ellis Team. Southwest Florida real estate prices rose from the 90’s through 2005. 2006 is when we saw prices begin to fall. The Ellis Team Current Market Index (CMI) predicted that would happen around July of 2005 when the market was absolutely red-hot. The market peaked in January of 2006.

Current Market Index Predicts Future Real Estate Pricing
Real Estate Prices 2009

The CMI has been rising. We focus on the direction of the CMI as the actual number. When the index reaches 4+, either on the upswing or the downswing it begins to move prices. There is typically a 2–6-month lag between the index and the actual price movements, so knowing where the index stands, and the direction is critical ahead of time.

Back in 2006 the Ellis Team was able to advise seller clients to get aggressive with pricing before the market forced them to take even less. All our clients listened, and they were glad they did as they watched the market plunge. These decisions were based off data, not emotions or I think this might happen.

Later when home sales became tough, we went on TV again and showed a different way to sell homes when others weren’t able to sell.

The Ellis Team Current Market Index will go up and it will go down, as will prices. It was designed to help interpret the forward direction of pricing. You cannot read more into it than that, as we have to look at the actual number, the direction, and the pace. Back in 2006 the pace was significant. While the current number is rising, it is nowhere near the pace of 2006, so we are not calling for a plunge in values.

Consultants Vs Salespeople

The cool thing is this index will tell us the forward direction of real estate prices before they happen. If you have questions about your home and the Future of Real Estate, call Brett Ellis or Sande Ellis 239-310-6500. We’ll be glad to evaluate your situation and give you the information to make good decisions for your family. We consult with you after listening to your needs.

Good luck and Always Call the Ellis Team at Keller Williams Realty!

 

Latest released data shows SW Florida 12-month housing prices hold steady. The data was sort of a mixed bag.

Median sales price is down $25,000 from $425,000 down to $400,000 this October. However, average sales price was up $16,068. The median sales price is down 5.9% over last year while the average sales price is up 3.0%.

We like to look at year over year data because there is some seasonality to our local SWFL home prices. The larger luxury homes tend to sell in season or just after. Luxury buyers tend to visit in season and put in offers in the first half of the year more so than the second half. Don’t mistake that you cannot sell a higher priced home in the second half, it’s just that there are more buyers here in the first half.

Uptick in Buyer Activity

Last week we wrote about how interest rates influence home sales and provided historical data. We are happy to report that recent mortgage rate decreases have led to some buyers getting off the fence. Rates trended down for 3 straight weeks before leveling off, and buyers took advantage. Total pending sales increased by 37 this past week, which is a good sign.

1 weeks’ worth of data doesn’t identify a trend, but it is something we will be watching. It is slightly significant because it reverses a trend of declining total pending sales.

Home Prices Down From Peak

Median home prices are down $70,000 from their peak in April 2022 when they were at $470,000. Average home prices are down $111,210 from their peak in May 2022. Keep in mind, both those peak months are seasonal closing months, so they are usually higher than the averages.

12-Month Housing Prices Hold Steady

Selling Your Home Today

If you are selling your home today, you need up to the minute home statistics to make the best choices in marketing your home. One of the best indicators around is the Ellis Team Current Market Index. We no longer publish this publicly but it is available for Ellis Team clients. We can say that the Current Market Index has been rising since April 25th of 2023. This past week was the fourth week we’ve seen it take a pause in rising, only to begin rising again in subsequent weeks.

Current Market Index

We will be watching the Current Market Index to determine if and when a new trend begins, or if we have a continuation of the old trend. This is important because it tells us where housing prices will go. Like I said, if you are a seller, you would most definitely want to know what the future holds. If you knew prices were heading down, you’d want to get ahead of the market.

Back in 2006-2009 Ellis Team clients benefited because we were able to tell them what the market would do ahead of the market. Many thanked us for saving them thousands of dollars.

Buyers

Ellis Team buyers benefit from this data too. It helps knowing what to offer. If you are a buyer, we suggest checking out www.LeeCountyOnline.com and searching the MLS like a pro. We have some advanced search features you won’t find anywhere else. Our team of buyer agents can help you setup your searches with advanced fields you won’t see. They can also assist you with neighborhood market reports and more.

Sellers

If you have a property to sell, you can check out www.SWFLhomevalues.com It’s a great place to start and will give you a home value for Free, instantly. Of course, you can always call Brett or Sande Ellis 239-310-6500 to talk about your home, your situation, and go over the latest statistics and see how they affect you moving forward. We’d love to talk to you, even if you aren’t ready yet to make a move. Preparation is key to making the best decisions.

12-Month Housing Prices Hold Steady

While median prices are down from the peak, they have held steady the past few months. Aerage prices increased slightly last month, so we are seeing 12-month housing prices hold steady for now. we’ll keep an eye out in future months to see if this holds true going forward.

Good luck and Happy Selling!

If you look at the chart you will see how interest rates influence home sales. Look at 1982 as an example. As interest rates began to fall, the number of home sales began to rise. Then again starting in 1996 we saw rates falling and home sales rising.

Interest Rates Influence Home Sales

Fast forward to 2021. Rates bottomed out at 2.74% then started rising. Almost simultaneously home sales began falling. Sometimes there is a lag, but if you look at the chart many times it’s instantaneous.

Interest Rates Influence Home Sales in 2024

Nobody knows for certain where rates will be in 2024. As I write this article the 10-year yield stands at 4.471%. Three weeks ago, it was at 4.934%, so it has fallen about a half percent in the last 3 weeks. Some believe the Fed is about done hiking rates. Others believe the Fed may have one more rate hike in them.

Keep in mind, mortgage rates are not directly tied to what the Fed does. The market sets its own rates more closely tied to the 10-year yield. This is why we study it so much. What the Fed does can influence the 10-year yield, but the markets can also buck whatever the Fed does and do their own thing too.

Most people we talk to believe interest rates will start coming down some in 2024.  Most agree it could eventually get down into the 6’s somewhere, sometime between later 2024 or mid-2025. The average interest rate from 1971 through 2023 is 7.74% If rates come down into the 6’s, we could see a lot more buyer activity, which begs the question. If I am a buyer, should I buy now, or wait?  We’ve written several articles on this. We believe if you need a home, buying sooner before rates fall might help you beat out other buyers who have also been waiting for rates to drop. We know that interest rates influence home sales.

Should Homeowners Sell Now?

This depends on your needs. Some say prices nationwide could fall further as rates stay in the 7’s, but could level off once they hit 6’s.  Our advice would be, if the home isn’t working for you now, consider selling now. This is especially true if you’re selling and buying as you’ll be buying before rates fall and buyers jump back in.

Election

Truthfully, nobody knows where the economy will be in a year, what inflation will be, and what the election will look like in 2024. I saw an analysis the other day that showed election years tend to be steady until the uncertainty of who takes over shakes out. If this is true, we could see a steady year in 2024 with peak interest rates beginning or thinking about falling. This could set us up for a decent 2025.

Home Sales

We expect there to be about 4 million national home sales in 2023, and about 3.7 million in 2024. Unemployment may rise, which was the Fed’s goal to bring down inflation.

Florida may outpace the rest of the country once rate direction becomes established. Living anywhere in the South half of Florida might be a good bet, if you can afford it. Rising insurance and taxes are pushing some out while a new crop of buyers replaces them.

Always Call the Local Experts

The Ellis Team studies the market as well as anybody. Our team can guide you through your decision. We listen before we offer advice. We’re not here to sell you anything. Our goal is to help you make the best decision for your family. We might challenge you with some facts so you have something to think about. We don’t follow the herd mentality, rather what is right for you.

You can call us at 239-489-4042 or visit www.LeeCountyOnline.com and search the MLS like a pro. Your data will never be sold to 3rd party companies or other Realtors, so you won’t have 20 Realtors calling you by signing up. Your data is safe with us, and you will only hear from us. Now that’s a Thanksgiving deal worth celebrating!

Hope your turkey dinner was great. Let us know how we can help you!

Ellis Team Weekend Open House

Open House Saturday 12-3 PM

Ellis Team Weekend Open House River Grove Estates
Over 1 Acre

3199 River Grove Cir, Fort Myers, FL

Over 1 Acre Lot with fenced back yard, shed, 2+ car garage

Today we want to explore real estate false imprisonment. Back in 2007-2012 we used the term real estate prison because people felt they were in prison in their own home because they were upside down on their mortgage.  The only way out was to short sale, bring a bunch of money to closing, or default and risk foreclosure. Their needs changed but they could not financially get out.

Real Estate False Imprisonment

Get Out of Jail Card

Virtually nobody is in real estate prison today because so many paid cash in the big runup or paid a large down payment because they were competing with other buyers. Additionally. prices appreciated so much and have not fallen like they did back in the 2000’s. Sellers today do not feel like they are a prisoner in their own home because of home values, they feel locked in for another reason. We call it real estate false imprisonment.

So many people financed their home at rates around 3% and they don’t want to give that up. If they were to make a move today, they would trade in that 3%ish rate for something closer to 7% or more. So, many are holding tight.

Waiting For Interest Rates to Change Could Cost You

Last week we talked about how waiting for rates to come down might hurt many home buyers. This is also true for homeowners who feel locked into their existing home. There is a downside to waiting to make a move.

Here is what we do know. A home feels comfortable for you for a period of time. It meets your needs. Then things change in your life, and your homeownership needs change. Some people outgrow their home, others want to downsize when the kids move out, and others need to change locations. Still others get tired of the homeowner life and opt for the carefree condo life. Some try the condo life and love it while others say not me and move back to a single family.

Whatever your needs are, they change over time. Back in the early 2000’s people were locked into their homes due to financial reasons. This isn’t true today.  While it can be uncomfortable living in a home that no longer works for you, many do it. Most do not realize there is a better way. Sellers today have options, and there is more inventory available to move to. When rates were rising, many sellers didn’t pull the trigger because they didn’t know where they would move to. Be sure to read last week’s article “Interest rate Purchase Strategy

New Programs

We literally have new programs now that allow you to purchase another home, so you are not homeless, then sell your existing home. You only make 1 payment on the new home with no payments on the existing home. This gives you time to move into the new home and sell the home that is no longer working for you. You also avoid having 2 payments.

Trusted Advisor

The key is sitting down with an experienced Realtor you trust and going over your options. We perform a needs analysis and identify where we can improve your situation. Our team has resources to help you identify ways to make a move happen for you at the least inconvenience to you, and the least cost. It doesn’t cost anything to sit down with us and discuss your options.

We know what it’s like to sell and buy. We’ve done it ourselves, and we’ve helped thousands of clients just like you do it. Making a move doesn’t have to be hard if you’re working with the right people.

Give the Ellis Team a call. 239-310-6500. Brett and Sande will sit down with you and discuss your needs. Is a move right for you? We won’t know until we talk. For some it is the right move. Some decide to stay put. The decision is yours, and it’s always easier with the right information. We are not here to sell you anything. We enjoy giving people their options. Should you decide a move is right for you, of course we’d be honored to work with you. Don’t let real estate false imprisonment keep you from living in the home that best suits your needs. Or visit www.swflhomevalues.com to get a quick estimate of your home’s value.

Good luck, and Happy Selling!

We’ve been having a lot of discussions lately with buyers regarding their interest rate purchase strategy. With rates rising so fast, naturally they ask the question if now the right time is to buy.

Here is what we know about interest rates, and the 3 implications of waiting for rates to drop.

Interest Rate Purchase Strategy

Interest Rates Could Go Up

If rates go up, it will cost you to wait. As rates increase, so does your payment.  You may even qualify for less home if rates continue to rise.

Interest Rates Could Stay the Same

We could have a period where rates stay the same for a while. In this scenario, as a renter you’re getting nowhere.  Your landlord thanks you, but you are gaining no equity whatsoever. When you rent, the interest rate is always 100% because all goes to somebody else and none to you or your equity.

Interest Rates Could Go Down

This is perhaps the worst possible scenario for buyers. Like you, other buyers have been on the fence too. When rates decline, other buyers hop off the fence and jump into the game. They become your competition for buying the same homes you are looking at.

When this happens, it can put pressure on the market and cause prices to go up. We saw this movie a few years ago when the rates were lower. Buyers were tripping over themselves to buy anything they could. At this point, sellers are not your competition. Your competition is all the other buyers looking to purchase the same home you are.

Added Benefit

Not only can you lock in a home price today while there are fewer buyers competing for more homes, you have an added benefit. You may be able to refinance later when rates come down. Contrast this with buyers who wait. They may be paying a higher price for the home. You locked in your price when rates were higher, and now you can refinance at the same rate they’re trying to buy a similar home for. You’re both financing at the same rate down the road, but you may be in the home for much less because you bought before prices started rising again.

In all three scenarios a buyer is better off buying today than waiting for rates to drop. We haven’t even mentioned yet the tax advantages of writing off interest versus rent. It’s easy to follow the masses and do what everyone else is doing because there is safety in numbers.

The truth is, this is where the opportunity lays. Opportunity always comes from doing the opposite of the masses. In the stock market you buy when everyone else is selling and sell when everyone else is buying. While we are not giving stock advice or predictions on what the real estate market will do, we do know a few things.

Over time, owning your own home is a good bet. The sooner you start that process the more wealth you are likely to have over your lifetime.

Home Buyer Seminar

The Ellis Team conducts home buyer seminars for people wanting to learn how to get into their first home or build wealth through real estate. If you’d like to attend a future seminar, give our office a call at 239-489-4042 We’ll be happy to get you into our next seminar, or meet with you one-on-one if that helps too.

You can also search for all the homes in MLS at www.LeeCountyOnline.com Our team is experienced and can give you the latest market data to help you make better decisions. We also have access to financing options that you might not know about. We have ways to get that rate down and several programs to get that down payment down too.

The Ellis Team looks forward to helping you make a good decision for your family. If you are a seller, you should call us too. Put our Know How to work for you. Experience wins the day, and the Ellis Team definitely has the experience.

 

Good luck, and Happy House Hunting!

Most buyers and sellers do not realize that Zillow busts agent marketing budgets. Let’s explain what Zillow is and what they do.

Zillow Busts Agent Marketing Budgets

What is Zillow?

Zillow is an online portal that collects leads from buyers and sellers by displaying property information from the MLS. They made their mark by offering the Zestimate which was an online value generator for homes across America. Homeowners were intrigued by the Zestimate because it was a way for them to track their home value over time. It wasn’t always accurate, but that didn’t matter. It was exciting.

Later on Zillow got into the homebuying business and bought homes to flip. They later discarded this business because they admitted they were unable to accurately predict a home’s value, nor the future direction of a home’s value. So now they pretty much stick to selling leads to agents.

How Zillow Busts Agent Marketing Budgets

Zillow collects a fee on every transaction for agents in their Flex program. The fee in the Cape Coral/Fort Myers area is 40% on homes over $300,000. It is 35% between $225,000-$299,000. Most home sales in Lee County are above $300k. What this means is the agent or team pays 40% of the listing side commission to Zillow first. Then, they must split with their broker. If there is money left over, they may have money to pay employees, rent, signs, phone, internet, gas, car, etc. Then there is advertising. If an agent is paying 40% off the top to Zillow, and another 10-50% to their broker, this isn’t much money left for advertising a home, or for buyers.

Dependent

 Agents become dependent on Zillow for everything. They receive buyer and seller leads, and they have little to no money left over to acquire leads or advertise in other places. Zillow has another program called Zillow Premier which allows agents to pay a monthly fee. I know some agents paying $20,000/Mo for this program. They avoid the high referral fee on each transaction, but again the money is sucked up by the monthly spend. The agents become dependent on Zillow for leads because so much of their budget is tied to one source. To be fair, there are other agents paying $5,000/Mo or less, but they get even fewer leads that way.

In the Way

All Zillow does is get between the agent and the transaction. Zillow is not alone, there are other online portals like Homes.com, Realtor.com. etc. Each of these charges leads back to agents in some form or fashion.  What if that money went to advertising a home instead of online portals like Zillow?

Who is to Blame?

Zillow is in business to make a profit. Some agents like the easy button where they acquire leads to work on for a price. Some agents don’t have or maintain a client database. They are transactional agents. They love working the deal, but then that’s it. Relational agents like to keep in touch or hold client events. It’s more of an ongoing relationship versus a one and done transaction. Consumers do not know the business and they like some of the features of Zillow. They don’t realize many of those features are available in other places. Other sites may have even better features, but Zillow spends so much advertising themselves that consumers find their way there. Zillow bids up the keywords and consumers click on the first link they see in some cases. So, nobody is to blame, and yet look at who benefits.

We Do Not Advertise on Zillow

The Ellis Team quit advertising on Zillow years ago. Our website has some better features www.LeeCountyOnline.com and www.SWFLhomevalues.com and we prefer to spend our advertising dollars on our clients and our clients homes. I am sure there are some very successful agents who still advertise on Zillow. We choose not to. Zillow’s success makes no difference to us as we do not use them. We do not blame other agents who do. We just want consumers to realize where their commission dollars are going and decide for themselves whish way is best for them to buy or sell.

Always Call the Ellis Team at Keller Williams Realty 239-489-4042 We’d love to talk to you about how we advertise your home and get Top Dollar. We’ve been voted the Best in Real Estate for 11 straight years by News Press readers.

Ellis Team Weekend Open Houses

Open House Saturday 12-3 PM

8515 Oakshade Cir #101 Fort Myers, FL $330,000

2 Bedroom 2 Bath in South Fort Myers
Open House Saturday 12-3 PM

Open House Sunday 12-3 PM

1417 NE 34th St Cape Coral, FL $330,000

3 Bedroom 2 Bath cape Coral Home
Open House Sunday 12-3 PM

 

I want to talk about the difference between salespeople versus order takers. Most are surprised to know that 87% of Realtors fail and leave the business within 5 years. This means that only 13% have been around since 2018.

We often see real estate agents leave the business when the market shifts. 2023 is no exception, and with real estate closings down significantly year to date, we expect more to leave the business when board fees become due at the end of year.

Skills Based Market

The 2023 Southwest Florida real estate market is a skills-based market. Only the best salespeople will survive because there are less transactions to go around. A few years ago, anyone could sell a home because the market drove sales. In many cases, you just had to show up with a blank contract in hand and write it. Buyers and sellers didn’t seek out the best agents because in their mind it didn’t make a difference. They just wanted someone there now! I would argue that did cost some of them, but that’s another story.

Sellers Need Salespeople Versus Order Takers Now

Today, things are different. Homes do not sell in a day, and certainly not with 50 offers each. It takes marketing and salesmanship to get the job done. Agents need to learn to probe deeper and find out what’s going on. When a buyer says no, there might be more to the story. Overcoming an underlying issue that has nothing to do with what the buyer said may make the difference.

salespeople versus order takers

Often the buyer’s first objection is not the real objection. Too many times we see agents solving for the objection they heard versus probing for the true objection. When agents spend time and energy solving an objection that isn’t even real, they’ve wasted an opportunity.

Imagine you were playing a game of Find and Seek. If you took the clues down the road on the right and spent all your time there, you’d be disappointed to find out the object was on the road to the left. You would have wasted all your time looking for something that was never there.

Isolate Objections

Buyers don’t intentionally lie. They throw out objections to slow the process down, because they are afraid, or they have not thought enough about what they truly want. A skilled agent learns to isolate the objection. By isolating the objection, you can determine if you chose the right road, or if you need to ask more questions. No sense spending time on the wrong road. It’s hard enough to find solutions on the right road, let alone choosing the wrong road.

This is why sellers today need salespeople versus order takers more than ever. When the going gets tough, 87% get out of the business. When you hire an agent, you want to know three things.

  1. Your agent will be there until your house sells, not quit the business.
  2. The agent you choose has been through a shifting market like this before and survived.
  3. Your agent has a plan to sell your home and overcome objections.

Experienced agents who thrived in up, down, and sideways markets give you your best chance because they have a track record. You have something to grade them by. When you hire a less experienced agent, you hire them because you like them. Liking an agent is very different than hiring the best agent. This is your home, your money, your life, and your success.

Always Call the Ellis Team

Sande and Brett Ellis have worked in the greatest Boom SW Florida may ever see, and the greatest Bust we may ever see, along with every shift in between. Today’s shift is easy peasy for us, because we’ve been here before and we thrive in a shift. We have the skills you need to sell! People skills never go out of style, and they are needed today. Call us at 239-310-6500.

If you’re an agent who is struggling, give us a call. We have sales positions available and leads. Our coaching and leads might just help you stay in this business and save your career.

Good luck, and Happy Selling!

Ellis Team Weekend Open House

8515 Oakshade Cir Unit 101 Fort Myers, Fl 33919

Open House Sunday 12-3 PM $330,000

Open House Sunday 12-3 PM
Super South Fort Myers Location