It’s been almost 2 months since we covered the SW Florida housing supply and even longer since we covered the traditional sales versus distressed sales with breakdowns by month. Since both affect our market and tell a story, we thought we’d revisit the issue which may lead to clues on where the market is heading into season.

Months Supply of Inventory SW Florida

Listings for single family homes and villas has increased by about 500 in the past month which has increased the months supply of inventory to 3.8 months, up from 3.5 months the previous month. When new inventory hits the market there is a lag because we calculate past sales into existing inventory to derive this number. Since the inventory wasn’t available to sell until now, there’s no way it could close. Because properties are being scooped up almost as fast as they hit the market, the months supply will come down, all else being equal.

When we look at the breakdown of sales by month, we see traditional sales rising by 96 sales over last October. Short sales are roughly the same, but you’ll notice a big difference in foreclosures, or REO’s (Real Estate Owned). Foreclosures are less than half of what they were last year, and traditional sales are rising as prices increase. More sellers can afford to sell as the prices rise.

Breakdown of SW Florida Traditional Sales, REO, and Short Sales

Banks have worked hard at accepting short sales in lieu of having to sell at foreclosure months later. Because the SW Florida real estate market was artificially too low, there has been upward pricing pressure. This is why median sale prices jumped $10,000 in October over September. Heading into season we could see more of the same.

We know prices fell too far because they were far below replacement cost, which essentially cooled the jets of the building industry for a several years, however now that prices are rising builders have found ways to build again at lower cost points.

With each rising price point it becomes feasible for builders to build again. Building bolsters our local economy in so many ways, so it’s nice to see that, especially since building was such a large component of the SW Florida economy.

The SW Florida real estate market is set to take off even further once the overall economy improves. We’re seeing price gains now simply because we were undervalued. We’ll see more once traditional demand picks up. We think there is pent-up supply and pent-up demand just waiting to attack our market. Both will rise as the economy improves, and each may temper the other. We have many sellers who would like to sell once prices rise enough to cover their mortgage. They are current on their payments but strapped in their home.

We have buyers who’d like to buy but need to sell a home first, or are just waiting until they feel better about business. You’ve heard the term a rising tide will lift all boats, and the same is true with the economy. Once that happens, this market could blast off.

Good luck and Happy House Hunting!!!

We hope everyone had a wonderful Thanksgiving this year with friends and family.  While most of the other Holidays seem to be so commercialized, Thanksgiving is still one Holiday when we can all get together and be thankful for who and what we have and not be so concerned with the presents we just opened or lamenting at the missed objects we desired but didn’t receive.  I tell my kids each year, Thanksgiving is a day to be thankful for what you have, not to worry about what you don’t.  If we worry about what we didn’t receive, whatever we have will never be enough.  It will always be about what could have been, not what is.  This week is a special week.

Now, throw all that out the window on Black Friday.  Of course they had to start Black Friday on Thanksgiving.  I hope they don’t ruin that.  I hope those that were out shopping early continued their Thanksgiving and ventured out with friends and family.

Lee County Florida Median homes Prices 2009-2012

Here in SW Florida we have more to be thankful for this year than in years past.  Prices rebounded nicely up to $134,000.  As you can see by the graph, prices typically start going up this time of year, and this year was no exception.  It’s nice to know our market is continuing a positive trend.

One of the other factors we like to look at is the mix of properties in various price ranges.  For instance, in 2009 our median price bottomed because the low end firmed up, but that wasn’t the end of the story.  The upper end had room to fall while the bottom was rising.

SW Florida Real Estate Mix of Home Sales

We are seeing positive signs across all price ranges. We need look no further than the over $500,000 price range.  Last October there were 24 traditional sales and 3 short sales over 500k.  This year there was 33 traditional sales and 4 short sales.

In the $200k-500k range there were 113 traditional sales and this year there were 187.  Same goes for $100k-200k.  The only price range that sales declined in was the under $100k range, but that’s because most of those properties increased in price and graduated into the over $100k range, another good sign.  It’s getting very difficult to find anything under $100k, and one day we’ll be saying the same thing about $200k.  This is all indicative of a recovering market.

A few years ago we mentioned the market was healing and that it was a process, not an end.  We had a lot of making up to do and forgiveness wasn’t going to happen overnight.  Main Street is a little bit like Wall Street.  A few stocks can move a market, but if trading volume is light the full breadth and scope of the market can be missed.

We are beginning to see signs of strength with a wider breadth which indicates we are in full recovery.  I’m not saying our market is completely healed.  It is still a price sensitive market.  There are some things that can still stall the market, both here and nationwide.

However, this week isn’t a week to focus on what we don’t have.  Thanksgiving week is the time to be thankful for what we do have, and we do have a recovering market with tons of opportunity.

So let’s all sit back and savor.  Inventory is rising a bit which is good, because we’re going to need it heading into season.  Enjoy your leftovers this weekend.  And with that I’ll leave a word of caution to buyers.

The early bird gets the worm.  If you see something you like, grab it.  If you miss the main meal, you might be stuck with the leftovers.  Leftovers can be good, but I’d rather have a crack at my first and second choices before they’re picked over.  It’s just not as much fun settling for your 5th most favorite home when you could have had your #1.  You’re not in competition with the seller; you’re in competition with others buyers.

Consider this season a Black Friday sale.  The first one in the door gets the first crack.  Those that wait take their chances the shelves may run empty.

Good luck and Happy House Hunting!!!!


I recently read an article in Florida Realtor Magazine which is a trade magazine for Realtors that showed 14% of Realtors are using video.  The article focused on the fact that video is now the number one Internet activity even surpassing emailing.  They recommended using YouTube Analytics to verify the reach of the video audience. Realtors Using Video!

Because the Ellis Team has used video for awhile I decided to look at the analytics and see if the results the magazine touted matched what we were seeing.

Realtors Using Video
Ellis Team YouTube Channel Video Statistics

In the past 30 days our channel has received 4,471 video views. 71 came from a Google search about SW Florida. 33.9% came from mobile apps which may explain why Facebook is concentrating so much on the mobile platform.

The YouTube search pulled in 691 video looks so one could argue YouTube is a bigger search engine than Google is, at least for video.

Video Statistics by Country for Ellis Team at RE/MAX Fort Myers
YouTube Analytics by Country for Ellis Team YouTube Channel

Recently we’ve sold homes to buyers from Germany, Canada, and Dubai, so I wanted to see if video is helping us reach those markets.  Sure enough, Germany and Canada scored very high at #2 and #3 right behind the United States.  United Arab Emirates came in at #15 with 23 video views.  The buyers said they were on our website and found us on the Internet, but I guess the next question should be where on the Internet?

Did these buyers find us on our MLS property search page or ?  Did they find us on video first which led them to other areas on our site?  When a buyer says they found us on the Internet, maybe watching a video is the sum total of what they meant and they looked no further?


The International list goes on for pages so we just showed the top 25 this past month.  I’m amazed that there were 13 views from Turkey, 14 from Kuwait, and 95 from Saudi Arabia.  Could it be that we’ll sell a luxury home to a Prince from Saudi Arabia in the next month?

The answer is it’s possible.  Buyers from all over the world are finding Realtors through video.  These views we’ve provided don’t even count the virtual tours we use. Last month our virtual tour site link which can be found at received 4,125 views in addition to the YouTube video views.  Throw in our MLS property search sites, our site as a whole and views, our Blog and the numbers grow substantially.

The point is, only 14% of Realtors are using video now and more should be.  If Realtors knew the staggering number of people using video to find homes and research areas more would reach out and learn.  The trouble is video is hard to do on your own.  Sound quality is an issue and production costs are high.  With today’s modern technology those costs are coming down.

For instance, we produce our shows in-house and add our jingle and graphics.  While we have an advantage from doing TV shows and radio shows over the years, an agent without all this could hire a virtual assistant to create logos, music, and even edit videos.  An agent can even do voice overs if the initial sound quality isn’t good.

Doing video poorly isn’t good, but doing nothing can cost as well.  As you can see from the numbers, video is becoming one of the most important things.  Reaching the mobile buyer is critical.

More tablets and smart phones will be sold this year than PC’s.  More Internet traffic will occur over mobile than the office.  The sands are shifting, and Realtors have to be at the forefront.  The good news is, the real estate industry has always led, and will lead with video.

Good luck and Happy House Hunting!

This week we decided to focus on the local Southwest Florida real estate  market and study how the distressed sales market is affecting the overall market.  As we’ve been reporting median prices have been dropping the past few months which is typical this time of year.  Many people will blame it on foreclosures and short sales dragging down the market but a closer look reveals it may not be.

Cape Coral Days on market, Fort Myers real estate

Average days on the market has been slowly rising, however it did the same thing this time last year so we’re not too concerned.  There is sometimes a brief lull before the season sales heat up beginning in January.  Inventory is up slightly but hardly enough to keep up with demand in season.  This upcoming season could be held back due to limited inventory.  Depending on how election goes, prices could rise quickly or stagnate.  We’re writing this article before the election so we have no idea what consumer sentiment about the national budget, the fiscal cliff in January, or anything else until more is known.

What is known is that distressed sales actually increased in the 3rd Qtr of 2012.  This isn’t the end of the story however.  People usually associate foreclosures and short sales with lower prices, and it’s true the distressed sales were at lower price points than traditional sales, but an in-depth look reveals something interesting.

Fort Myers Beach Traditional sales graph

Traditional sale median single family home prices actually fell $6,000 while short sale median prices rose $3,500 and foreclosure prices rose $1,775.  We can’t blame the decrease in prices to distressed sales, so something else is going on.

It is seasonal. It can also be the economy.  Employers have been on hold waiting to hear what the health care regulations will be, along with what will happen in January with the financial cliff.  Several large employers nationwide were set to give pink slips to employees until the Obama administration said by law they don’t have to give the notice.  He made an executive order to suspend that law during the election.

The thinking must be that whomever is elected will work with Congress in Nov and Dec to avoid severe cutbacks in defense spending and high tax increases in January.  Once employers know what the true cost will be to hire employees they can make decisions.  Our nation has been in a no-man’s land and it’s hurt the economy.

The economy drives the real estate market, and in turn real estate sales pays back the economy with spending on things like appliances, carpet, home improvement, etc.

Either way I think season will be good because we have low inventory..  The question is will it be great?  The answer to that relies on the economy and the next president’s ability to work on solutions with Congress, for the benefit of us all.

Good luck, and Happy House Hunting!!

We’ll attempt to answer a few questions we hear things buyers say:

Things Buyers Say

1. What did the seller pay for the home? What the sellers paid back in time really has no bearing on its value today. If a seller paid $300,000 5 years ago and it’s only worth $200,000 today you’re not going to offer $300,000 because that’s what the seller paid. Conversely if the seller paid $62,000 back in 1975 and it’s worth $300,000 today their not going to sell it for $90,000. Sellers should expect to sell at today’s current value and buyers should expect to pay that as well. What a seller paid or how much they owe has nothing to do with value.

2. If it’s meant to be it will happen- When a buyer says these words it’s typically out of fear of making a decision, so they sit back and let someone else make the decision for them. Let’s say more than one buyer is interested in a home. Buyer A doesn’t know what to counter offer in light of the news another buyer is interested, so they freeze. They essentially let another buyer make the decision for them. I’ve found in life that when you let others make decisions for you, you might not like the outcome. You are in control of your own destiny. If it’s a home that suits your needs and you really like it you have a chance to control your fate. Step up or you may be forced to offer on your 3rd or 4th best favorite. In this market there is limited inventory, so finding 4 homes you really like might be tough.

3. Is the Seller motivated?  If I am the listing agent I simply answer the buyer agent with yes, they are interested in selling or they wouldn’t have put it on the market. It’s in the buyers interest to find out what they can if a seller or seller’s agent will tell, but it’s not in the sellers best interest to do so. You can always ask the question, but don’t be offended if you don’t receive an answer. The buyer doesn’t get to know the seller’s private business just as the seller doesn’t need to know the buyer’s private business, other than if the buyer is qualified at the agreed upon price.

4. I heard you always offer 10% less on a home. We’ve had buyers say this is a rule where they came from. First off, there is no rule. Secondly, all real estate is local and certain areas may have customs, but I highly doubt asking 10% less in any market is a good idea unless sellers typically overprice homes in a certain area. Most homes in SW Florida sell for about 96-97% of asking price, so if you’re offering 10% less you’re probably losing out to other buyers who are more realistic. If a home is overpriced by 10% or more that’s another story, but those homes typically aren’t getting offers because they are so over-priced.

5. Will the seller do a lease-option? Most sellers wish to sell outright. Occasionally a seller wouldn’t mind leasing first, but they hate to lock in a price today at today’s prices in a rising market. Buyers typically have misconceptions about how the lender will finance the home at the end of the option. Rent money cannot be used for down payment money unless buyer pays over fair market rent as determined by the appraiser and then only that portion above fair market can be credited as down payment. Also, the buyer loses the option money if they don’t close for any reason. Many buyers ask this question because they don’t have good credit today and they may not have 1st month, last month’s rent and security deposit. Both buyer and seller should sit down with an agent and discuss their options first or a situation like this could turn out badly for both later.