Currently sellers control the real estate market across the state, but for how long?  We can say with absolute certainty that 2021 is the best time for a seller to sell that we have seen, ever.

What typically happens is sellers see the market going up and they believe it will always be higher next year, so they wait.  The problem with that strategy is twofold.  Prices may be higher next year.  If they are, when they go to sell, whatever they buy next year will also be higher.

Sellers Control Real Estate Market
Sellers control real estate market in Florida

If prices max out in 2021, they waited too long and missed the mark.  In a rising market sellers generally hold out. The market does not give you a warning sign that it is about to turn.  It just happens, and sellers inevitably wish they had sold the year prior.  We saw this after 2005.

We are not saying market conditions are the same as 2005.  Back then we had over-supply of homes.  We do not have that now.  In fact, construction needs to pick up the pace to keep up with Florida demand.  All we are saying is, the market is hot right now, and that will not last forever.  When it eventually runs out, some people will wish they pulled the trigger sooner.

Unfortunately, many will miss this opportunity, and they will not be able to sell in the future.  Perhaps they owe too much, or interest rates move higher and they cannot afford as much home as they could this year.

When interest rates rise, and they will at some point, it hurts buyers and sellers.  Buyers can afford less, which is less fuel for the market to rise.  Sellers who decide to sell when interest rates are increasing will face higher financing costs too.  In essence, it will limit how much they can afford if they are getting a mortgage.

Essentially sellers get hit with a double whammy.  Increased costs when they buy their next home and fewer buyers able to afford their current home.  Rising interest rates can put downward pressure on home prices unless demand is sky high.  Today demand is sky high, but what if it’s not next year?  And, what if interest rates are higher next year?

When the market gets so one-sided there is generally opportunity in there somewhere.  Right now, we believe the opportunity lies with the seller.  Sellers have everything to gain by selling now and have the most to risk by holding out another year or two.  We are not saying prices will drop or the market will turn.  If things stay the same, there is more fuel for this hot market.

All we are saying is, what if things do not stay the same?  We have a new administration coming into Washington.  They will implement new pans, new taxes, etc.  Some of these things may take a while to implement, while others may be sudden.  The long-term effects of such policies might take a while to kick in.

Nobody knows the future.  We do know the present, and presently the sellers control the real estate market in almost all scenarios. Visit Reali for more real estate information and guidance.

If you have been thinking about taking advantage of this market and just want to know your options, reach out to Brett or Sande Ellis. 239-310-6500 or visit www.SWFLhomevalues.com We’ll be glad to look at today’s pricing with you and discuss your options.

Next year you may look back on 2021 and wished you had called us.  A phone call to find out cannot hurt you but waiting could.  Brett and Sande are easy to talk to, and we present you with your options.  We are not pushy, and we like to have fun with our clients.  Give Sande or Brett a call, you’ll be glad you did.

What do these eleven homes have in common? These eleven top dollar residential property listings recently sold at or above asking price with more pending sales on the way.  The Ellis Team listed each of these homes for top dollar and marketed them.  In most cases our marketing created multiple offers which results in a higher price for our sellers.

Top Dollar Listings Recently Sold at or Above Asking Price

When people hear the words “multiple offers” sometimes they assume the home was listed below market value.  The logic goes, if it’s a deal, of course everyone will want it.  At the Ellis Team, we believe sellers are entitled to top dollar, and the home does not have to be a deal to generate interest from multiple buyers.  The home simply must be marketed to more people, which generates more interest. More interest is what helped the Ellis Team sell top dollar listings recently.

Don’t Give it Away

If you are giving something away, many people will be interested.  You should not have to give something away to create interest.  I see the ads on TV.  Price sells cars, price sells appliances and price sells homes.  That is that company’s value proposition.  Buy from me, you will get a better deal.  That is fine when they are selling their products.  But what about when someone is selling your product?

Do you really want to list with someone who is going to give your house away? Do you really want an agent that will sell your home fast and for the least amount of money?  What if you could sell your home fast and for top dollar?  Doesn’t that sound like a better deal?

We have been conditioned as consumers we must be the lowest price to sell.  Think of it this way.  If you only had one buyer for a widget, would you get top dollar for it.  What if you had 10,000 buyers bidding on that same widget?  Do you think the seller would sell for a higher price?  Of course, the more interest in a product brings you closer to top dollar.  Minimal interest means you had better be the best priced.

So why list a home with a Realtor with minimal marketing?  If the Realtor’s marketing plan is put it on MLS and pray somebody sells it, that is not really marketing.  I know, some Realtors will tell you the MLS gets picked up by Zillow and Realtor.com so everybody sees it.  That is not true.  Everybody does not see it, and the ones that do simply look for the best priced listing online.  They look at metrics like $/sq ft which does not tell the whole story.

Upgrades Count

One home may have a pool while the next does not.  One may have quartz counter tops, upgraded flooring, cabinets, counter tops, etc. while comparables do not.  One seller may have maintained their home while recent sales may need some attention.  All this should be factored in.  When the buyer shows up and sees the home in real life, it matters.

Minimal marketing creates minimal interest and does not always produce top dollar.  Most Realtors do not aggressively market because it costs money.

One mistake sellers make is assuming all agents do the same thing.  If that were true, I would go out and hire the least expensive agent I could find and let the MLS sell my home.  Unfortunately, this is not true and the agent you hire matters.

We talked about marketing.  Another factor is hiring an agent with experience that works at the best Residential Real Estate Company.  Find an agent that does not take the first offer simply because they are worried another offer will not come along.  If they are aggressively marketing your home, you have the luxury of choosing the best offer, not the only offer.

Talk to Us Before You List!

Before you list your home, talk to Sande or Brett Ellis 239-310-6500  Hiring the wrong agent could cost you thousands.  We have the marketing and experience to get you Top Dollar.  Just ask the happy sellers of these 11 homes.  Or visit www.SWFLhomevalues.com for a free instant online estimate of your home’s value.

Ask us for a list of Top Dollar Listings Recently Sold by the Ellis Team.

Good luck and Happy Selling!

Good news for home buyers and home sellers in Lee County.  Conventional loan limits increase to $548,250 in Lee County.  The previous loan limit was $510,400.  Because sales prices have increased this past year the loan limit was increased.

Conventional Loan Limits Increase to $548,250 in Lee County
Conventional Loan Limits Increase to $548,250 in Lee County

If a buyer wished to finance over the $510,400 it made the loan a jumbo loan.  The interest rate may have been higher and the underwriting guidelines in some cases could be stiffer because jumbo loans are not insured by FNMA or Freddie Mac.

Conventional Loan Limits Increase

The increase to $548,250 means a buyer can pay more for a home and still meet conventional loan guidelines.  Interest rates are around 2.5% for people with good credit.  This eases down payment pressure for many buyers who need a conventional loan.

Let’s say a buyer wanted to buy a home for $600,000.  Under the old guidelines the buyer would have had to put $89,600 down to stay in a conventional loan.  Today the buyer could put down $51,750 and still meet conventional guidelines.  That would be 8.6% down payment which is acceptable.

With conventional loans the buyer can put down as little as 3%, but 5% is more realistic for most people.  The PMI rate (Private Mortgage Insurance) declines the more a borrower places in down payment, and it disappears entirely if buyers put 20% down.

Buyers Can Afford More Home

The bottom line is buyers can absolutely afford more home today than they could last year.  Down payment requirements are less and interest rates are less.  This is good news because prices have been going up, so this alleviates that pressure.

This is one more reason we believe there is still fuel to power prices higher.  Of course, low rates will not help if the economy crumbles or demand falls.  We do not see any signs of demand falling.  In fact, Florida is more attractive than ever to northern buyers in high tax states.  Companies are leaving northern states and relocating to Florida, so it is not just remote workers making the switch.

Conventional loan limits increase benefits sellers as much as buyers because more buyers now qualify for the same property.  We already have multiple offer situations on many properties, and the conventional loan limits increase may add to the demand for properties priced $535,000 and higher.

In the coming weeks we will report final 2020 real estate market numbers.  To date we have official numbers through November, and we expect 2020 to end with a bang.  Traffic on our roads is busy, and our team has been busy working with buyers from all over the country attempting to purchase a home.

By all accounts, 2021 should be another great year.  The only thing that may hold it back is lack of inventory.  Sales could decline simply because we do not have enough inventory.

Considering Selling?

If you are considering selling, please call Brett or Sande Ellis 239-489-4042 Ext 4.  Now may be the best time.  Our marketing is reaching local and out of town buyers, and they are making offers.  Our team is working harder than ever for our clients. We are getting sellers who list with the Ellis Team top dollar.  It is always more fun to sell when we attract multiple buyers for your home.  Sellers can sit back and select the best offer, but that is only possible when you saturate the market.  Advertising locally and nationally is the key.

Or you can check your home’s value instantly at www.SWFLhomevalues.com Prices are changing by the week so it pays to keep up.  Is there a price you would sell your home at?  If so, perhaps we should talk.  Always ask for Sande or Brett Ellis.  There is no substitute for experience.

January 2021 SW Florida Real Estate Market Update

 

Real estate sales prices rose over 20% since last November in Lee County.  The median sales price last year was $262,500.  This year it was $319,150 for a 21.6% gain.  Average real estate sales prices last year were $335,357.  This year it stands at $422,452.  That is a whopping 26.0% gain.

Real Estate Sales Prices Rise over 20%

October year over year numbers saw similar gains, so it was not a one-time anomaly.  If you read our articles regularly you know that we have talked ad nauseum about the reasons the Florida real estate market is on fire.

How Long Will it Last?

The real question everyone wonders is how long it will continue.  We believe there is good reason for this market to continue for a while.  Interest rates are low, and we expect them to stay low. Oil could rise with new energy policies by a new administration.  Typically, when oil rises it is inflationary and interest rates rise as well, but that may not happen for a few years.

Rising oil prices could eat into consumers wallets which might limit how much they can spend on things like housing.  This could tamper the positive effects of low interest rates, but only to a degree.  Florida still stands to win big because companies are seeking low tax states.  Companies and residents are fleeing states like New York, New Jersey, Illinois, and California in droves.

Making matters worse, as residents flee, these states are raising taxes on the residents who are left to make up the shortfall.  It is a vicious cycle, and at some point, it is game, set, and match.  Florida sits in an exceptionally good position going forward.  You have seen the benefits the last 4 years and it is possible this may accelerate the next four years.

How to Win in Fast Paced Market

So how do buyers and sellers win in such a fast-paced market?  Experience!  Simply put, you must work with an experienced agent who has been through up and down markets.  Experienced buyer agents know where to find inventory, even when it is not on MLS.  Sometimes there is hidden inventory that is sold before ever hitting the market.

Other times it is having relationships with builders who call the top teams when a deal falls out, or when a new inventory home is about to become available.  Lastly, in a world where speed wins, technology can play a crucial role.  Having all the listings on a website updated in real-time is crucial.  Ours does. www.LeeCountyOnline.com  Many buyers are surprised to learn that the big portals do not have all the listings, and sometimes the data is old.

Sellers Benefit Too

Sellers benefit from experience too.  Multiple offers are good, but taking the wrong offer is not.  Experienced listing agents help weed out the good offers from the mediocre.  The highest price is great but evaluating the most likely to close is a skill onto itself.  Every offer is a gamble, but you can have the odds in your favor with some knowledge, skill, and investigation.

For instance, we call the loan officer if we have any question at all about the buyer’s ability to close.  We also look for the way items are worded in the contract which can yield clues.  Sometimes contracts are craftly worded to disguise a hidden contingency.  The contingency is not revealed because they feel it would hurt their chances of getting their offer accepted. This is exactly why sellers need the sharpest agent they can hire.

If you are looking to buy or sell in SW Florida, always call the Ellis Team at Keller Williams Realty.  We have experienced buyer agents on our team ready to put our skills to work for you.  Sande and Brett Ellis handle the listings on our team, and nobody is more experienced than we are.  We would love to help you sell your home and get you to your next destination.  You can reach Sande and Brett at 239-489-4042 Ext 4.

Good luck and Happy New Year!