The News Press held their annual Market Watch last night. Presenters Frank D’Alessandro and Denny Grimes presented their opinions on where the market has been and where it is headed.
Both presenters offered a grim outlook for the residential real estate market in SW Florida for 2007. Denny said "Needy or Greedy, the Market doesn’t care" and "Keep out the Ginsu knives, more slicing is needed" in regards to pricing.
We agree with about 99% of the facts the presenters made at the News Press Market Watch, and we agree generally with their overall assessments. We might point out however, a few topics for discussion.
In Denny’s mind sellers need to get realistic in price. It is true we have many sellers who are in Denial (See PG 2 of our report). We have however found that there is a market at the right price, and many sellers have set that bar. The sellers who are there are selling. So not all sellers need to reduce their price, only the over-priced sellers.
Secondly, we feel it is also incumbent that buyers get realistic as well. Many buyers want to low-ball everything, and we know that some properties are actually priced correctly. Those properties need to be bought, because they are valued properly, and they are being bought.
Because buyers are reading sensational statements, buyers are afraid to step up, even though many can now afford to buy again. Nobody wants to overpay, and nobody wants to buy now if they think the market is headed for a crash. We don’t believe the market is headed for a crash, quite the contrary. Denny correctly pointed out that it will be impossible to know when we’ve actually hit bottom. We’ll know after it’s already occurred, and then it will be too late.
We believe in many cases the market has set a bottom, and only when more sellers reach that level will they be successful in selling. Because many sellers actually are selling, we know there is demand, and much pent-up demand at that. That demand will grow much stronger once buyers regain confidence. The headline from the News Press paper "Show at Harborside Event Center presents grim outlook on slumping housing sales" will do nothing to renew that confidence anytime soon.
We don’t have a grim outlook. We think buyers are asking for permission to buy, anything to validate their feeling that now is the time to jump back in. Headlines like this are sensational and don’t ease fears, and perpetuate a slumping market.
Facts are facts, and nobody is hiding the fact that we have an excess supply of homes and condos on the market in the SW Florida real estate market. Yes, many sellers need to reduce prices to be successful, but not all. We’re selling many homes quickly because sellers are pricing their homes correctly the first time. Aggressive marketing, and aggressive pricing is a formula for success in this market.
Denny was absolutely correct in two areas. 1. Sellers need to take responsibility and stop blaming their agent, their neighbor, etc for the fact they can’t get a price more in line with 2005 prices. 2. Real Estate agents need to start standing up to sellers and telling them what they need to hear, not what they want to hear.
Unfortunately, some agents who haven’t been around through up and down cycles don’t know how to do this, and really don’t understand what is happening. Lastly, many sellers shop around for an agent who agrees with them on price, and eventually they’ll find one who will take the listing at their price.
Sellers might want to save themselves a lot of time and hassle and hire an experienced agent the first time instead of the third time. A home usually sells for a better price if it is priced correctly and doesn’t become stale on the market.
Our hats go off to Denny and Frank for delivering a bitter pill. While our outlook on the market may differ somewhat, we find that we agree with them much much more than we disagree, and they did a fantastic job presenting facts.