Monthly Archives: September 2011

Florida Real Estate Bargains a Victim of Perception

Posted on by

We’re writing this article this week two days before official numbers are released, so by the time you read this official numbers will have been released. Absent this knowledge, we expect prices in August to be higher than last year and sales to be down from last year, however sales volume may be higher than July.

SW Florida Real Estate Bargains
Year End Median Sale Prices For Single Family Homes SW Florida

We’ve included a chart of average year end sales prices which is really an average of prices for that given year, not the Dec 31 average price. As you can see, prices fell from their peak in 2005 through 2009 where they stabilized and actually rose in 2010. In 2011 we’ve seen more gains over 2010.

We started writing articles and advertising back in 2009 that Florida was on sale and buyers flocked here in droves looking for bargains from all over the world. Buyers have been competing with each other for the best bargains and in fact many of these properties have seen multiple offers. As you can see from the year end chart, prices are still very affordable and are on par with 1996-1997 prices. If you look at the attached chart you’ll notice prices in July were up 14.33% over last year and up 19.1% over 2009 prices.

Median Sale Prices Single Family Homes in SW Florida
SW Florida Real Estate Prices 2009-2011

We are fielding calls from buyers looking for foreclosures, short sales, and otherwise good bargains. They just finished reading on a website or watching an older YouTube video how another buyer bought a $20,000 condo or $30,000 house close to the beach and they want to come here and buy the same thing.

If you ask any agent in this market I’m sure they’d chuckle because they’re answering some of the very same calls. This is where the perception that Florida is on sale, which it is, collides with reality. The days of buying newer homes for $35,000 are over unless the home has serious defective drywall issues or is gutted. We still have some inexpensive condos for sale. For instance we just listed a bank foreclosure 1 bedroom, 1 bath condo in Mystic Gardens for $27,900 which is a bargain. These deals are becoming fewer and farther between.

Unfortunately buyers from all over are calling and expecting homes close to the beach or on the beach for ridiculously low prices. While it is true back in 2009 we had some seriously under-priced homes from some of the banks, prices have gone up considerably since then. We’re still well below replacement cost in most cases and we’re not headed back to 2005 prices anytime soon, however we are still a bargain.

Florida Real Estate Bargains

I guess there is a difference between a bargain and a steal. The steals are over, but there are fantastic bargains and opportunities in this market if you’re realistic. If a buyer is unrealistic, they’ll suffer the same fate as an unrealistic seller, which is no transaction. A buyer who fails to buy in this market is just as damaged as a seller who overprices and misses the top. While the bottom may be behind us, we’re still close enough to it that we can see it in our rear view mirror and prices today will look like a bargain years from now.

Remember back in time when someone you know once said “Gosh, I should have bought every piece of property I could get my hands on back when prices were lower?” Well, in the future I’m sure there will be those that say, “Gosh, I should have bought everything I could back in 2010 and 2011. Those were the days when there was little competition from new home builders, interest rates were at their lowest, prices were below replacement cost, and at those prices they actually cash flowed.”

It pays to be an educated consumer, whether you’re on the buying or selling end. Remember, money is always made on the “Buy”, not the sell. Inventory is going down. If you’re truly a buyer, learn the market and step up now. I bet you’ll be glad you did.

It’s kind of funny how humans follow the herd mentality. When everyone else is buying, people feel more comfortable buying at the top, but when things are down, people are scared of overpaying. Back in 2005 you were overpaying, but most felt good about their purchases. Look what prices have done since. The smart money is buying and holding today. Failure to land a property now is a wasted opportunity.

Spotlight on Town and River

Posted on by

SW Florida September 2011 State of the Real Estate Market ReportTown & River is a waterfront community tucked away on the river side of McGregor Blvd on the Fort Myers side of the river.  The community features deep water gulf access lots as well as a fresh water lake offering some nice lakefront views.  Not every home is waterfront, but all enjoy the peace and serenity of South Fort Myers living off historic McGregor Blvd and all the conveniences to everything that comes with it. Spotlight on Town and River.

McGregor Blvd was the original center of town and housing in Fort Myers used to be defined by which side of the street you lived.  While growth has certainly moved eastward, the charm and beauty of McGregor Blvd remain a fixture alongside Thomas Edison’s vision for McGregor Blvd showcasing why Fort Myers is named The City of Palms. It was Thomas Edison after all who was responsible for lining McGregor Blvd with the majestic palms we see today and defines our place in SW Florida history as people from all over come to visit our beaches and gaze at McGregor Blvd and the seemingly endless flow of palm trees as you drive down McGregor.

Spotlight on Town and River
Riverfront Home in Town and River Sold For $1.31 Million in 2011

 

 

River and Pool View of Town and River Home
River and Pool View of Town and River Home

Town & River features some amazing homes.  The highest priced home we could find in MLS in 2011 sold for $1.359 Million. It was a 4 bedroom 3 bath home with 3,241 sq ft of living area and had a nice view of Deep lagoon canal.  We found another home at the end of Cypress Lake Cir that sold for $1.31 Million which is a riverfront view home and features 4,430 Sq Ft of living area and 5 bedrooms along with 5 baths and 2 half baths, also shown above.

Canal Front Home Town & River
Town & River Canal Front Home

The home pictured above is a canal front home just seconds to the river and has 3,921 sq ft of living area.  This home sold in 2011 for $1.275 Million.

On the other end of the spectrum we just closed a home for $260,000.  The home is lakefront and featured 4 bedrooms, 2 ½ baths and a pool with a metal roof.

Lakefront Home in Town and River Fort Myers
Lakefront Town and River Home Closed in 2011

Currently homes are priced from $171,000 to $1.695 Million.  We found 21 homes actively on the market and 2 pending sales.  So far in 2011 our MLS shows 29 sales from $100,000 to the $1.359 Million sale we reported earlier.

The lowest priced home in Town & River listed for $171,000 is a 3 bedroom 2 bath home built in 1978 and features a pool, corner lot, and is also located on the lake.

If you’d like to search for Town & River homes you can do so on our website www.townandriver.net or search all MLS listings at www.LeeCountyOnline.com

Watch our September 2011 SW Florida Real Estate Market Report Video

SW Florida September 2011 State of the Real Estate Market Report

Higher Priced Foreclosures on the Horizon

Posted on by

We’ve been saying for months the next round of foreclosures to hit the market may be higher priced than recent rounds.  Testament to that fact one just arrived today for over $1 Million.  We are expecting another $1 Million+ property within a few weeks on Captiva Island as well.  To date banks have cleared out many of the vacant investment properties that were built as part of the boom back in 2004-2006.

Front of Bayfront Home
Bay front Home Bonita Springs Florida

The higher priced properties tended to cater to wealthier borrowers who perhaps lived in the home, at least part time, and could afford to ride out the bad economy longer than investors who ran for the hills when values turned upside down and were over extended.  While higher priced borrowers too may well have been over-extended, many had the wherewithal to ride it out, but their days have also been numbered.

Bay View Bonita Springs Home
Bay View Home

Case in point is our newest listing, which is a spectacular bay front home in Bonita Springs.  It is a 2 story home and features an elevator, a large black pool, a Viking grill on lanai for superb outdoor entertaining, and a gourmet kitchen with all the extras.

Outdoor Lanai and Pool
Outdoor Lanai and Pool
Gourmet Kitchen
Gourmet Kitchen

Every bedroom features a bay view.  The property has 2 docks both with boat lifts, a 3 car garage, and wide open views from the family room.  The property is located at the end of the street on a cul-de-sac so the home is essentially at the end of a peninsula.  The property is very private and is an entertainers as well as a boaters dream home.

Entertaining Area Upstairs

The home was purchased for $2.25 Million in 2007 and is now on the market at $1.51 Million.  The home has 3 bedrooms and a den along with 3 full baths plus 3 half baths. The home has 5,124 Sq Ft of living area.  Click to view the home online or take a Virtual Tour.

We’ve seen a concerted effort by banks to avoid foreclosing on these expensive properties.  A few large banks have contacted us with lists of and asked us tow work with selected borrowers to sell their home short now versus foreclosing later.

Imagine that fact.  A few short years ago banks were reluctant to process and approve short sales, and now they’re coming to experienced Realtors and asking for assistance with their customers to effectuate a short sale.  Even though the banks have identified their own customers they’d like to do workout a short sale with, they recognize the short sale is a complicated process and they want experienced agents to counsel their borrowers and market the short sale to buyers.

You might ask why a bank would do this.  The answer is it’s less expensive to consummate a short sale than go through the foreclosure process paying whopping legal bills all the while the property is not being maintained.  This process leads to a deteriorating property and a lower sale later on.  Banks are simply attempting to minimize losses.

In these cases it may make sense for a buyer to consider a short sale, or one of these high end foreclosures.  If you’re finding today’s economic environment challenging, call an experienced Realtor today and learn about options you might not have even known existed.  We just might be able to help you in these tough times and help you move forward instead of looking back.

 

Insider Secrets from a Foreclosure Pro

Posted on by

With foreclosures slowing down, the competition to purchase these bargains has become even stiffer.  Many people call each week hoping to land these bargain properties and few will win the prize, so we thought it might be helpful to buyers and agents alike to learn the inside secrets on being the successful bidder on these properties.

As a listing agent for many banks, we know what the banks are looking for. We speak to the asset managers.  If you follow these tips your chances will increase as not every buyer knows what the bank considers when looking at multiple offers, which many foreclosures receive.

The first thing buyers must understand is there is a lot of competition for these homes.  Typically bank foreclosures go fast, and for over asking price.  Everybody seems to want them.  So structuring your offer and submitting it correctly will increase your chances.

Foreclosure Tips From a Real Estate Pro
How To Buy a Foreclosure Chart

Keep in mind, listing agents must have all the required information, so if they ask for something upfront, they mean it.  Listing agents don’t have time to track your agent down for this info.  We attach a document to each MLS listing specifying what is required with the offer.  Make sure your agent completes every single field.  We submit offers into an online system, and if information is missing, the offer cannot be submitted.

The bank never sees your offer until one is accepted.  The listing agent must enter information into an online submission, and it must conform to what the bank asks for, and all fields must be filled out.  If a foreclosure has 20 offers, the listing agent doesn’t have time to call 15 agents and beg for information that is required by the banks online system.  Keep in mind, it takes awhile to upload 20 offers, and the listing agent may be dealing with 20 properties.

Listing bank foreclosures is very time intensive, and the listing agent coordinates everything from repairs to working out HOA fees, title issues, code violations, etc.  Providing the required information is the first step.

Secondly, consider that you’re probably competing against other buyers, and that many will be above asking price.  So how do you compete?  Consider a higher escrow money deposit, shorter closing time, and definitely a shorter inspection period.  Bank asset managers are also gauging the strength of each buyer, so you want to put your best foot forward in hopes of getting the property.

Banks are on the lookout for buyers tying up properties then using contingencies to escape later.  Banks want solid deals, so you want to dress up your offer to make you look like the best buyer in the batch.  The price will be close to asking price or above because it’s a deal anyway, so you have to compete in other ways.

In many cases banks will counter multiple offers with highest and best.  Buyers are shocked when the bank doesn’t and just accepts one offer, so it always pays to pony up early on and go for it.  If you do get a highest and best form, assume the other buyer wants it as bad as you do, and act accordingly, because if you don’t, chances are you won’t end up with the home.

Be careful that your offer is written well and clearly states all fees and costs.  It is difficult to impossible to make changes later, and it could cost you the home.  Any change to the contract later on opens up the possibility the home goes back out for rebid and you could lose it, so it pays to write offer correctly the first time.  Same applies with names; make sure everyone who wishes to take title is on contract from beginning. You may not be able to add names until after closing, which could require new title insurance and additional fees.

If you’re purchasing as an LLC, make sure you provide documents upfront that you’re authorized to sign for the LLC.  The bank will ask.

These are some very useful tips by an experienced foreclosure agent. Each bank has their own rules, so be sure to follow directions well.  Make sure you’re working with an agent who understands contract language. Many times we see financing contracts that don’t match up or specify some costs buyer is not allowed to pay under the buyer’s financing program, and the offer cannot be presented to bank until language is cleaned up which could cost the buyer the sale because of delays.  Be sure to work with an agent who has experience writing clear and concise contracts and understands financing in and out.

Following these tips will increase your chances, and ignoring them will most assuredly have you scratching your head wondering why the bank selected another offer.  Good luck and happy house hunting.