June housing inventory levels remained at 3 weeks of inventory compared to April.  We did see some movements in the markets the past few months.  Let’s look at which price ranges changed since April.

June Housing Inventory Levels Update

We have a little more inventory today in the $300k-$600k price range.  The $300-400k range grew by 42 homes and the $400-600k range grew by 50 homes.  Overall inventory grew by 91 homes. We saw an increase of 38 homes on the market in the $250-300k range.  All price ranges saw increases in inventory except for $250,000 and below which all saw decreases in inventory.  What offset the increase in inventory was steep closed sales in the $300k+ market.

While $300k plus market did very well, the $600k+ market is booming. June housing inventory levels are declining in the $600k+ market while it is increasing in the $250k-600k market.

The 365-day moving average number of homes sold has increased since April which indicates the market is gobbling up any increased inventory. The numbers tell us we have a robust housing market despite rising interest rates.

In April we saw a 160.2% increase in the number of cash sales over 2020.  Closed sales were up 63.3% in April, so this tells us more buyers are paying cash.  In fact, 35.5% of all deals in April were cash.

If closed sales were up 63% in April, why are agents talking about a slowdown?  We may see a slowdown in sales, but it will not be because of lack of demand.  Supply plays a role too.  New builders may turn out less product in the second half of 2020 and it will not be due to lack of buyers.  Many builders have cut off sales to keep their backlog manageable.

We will keep our eyes on the market to see if certain price ranges begin to accumulate inventory.  So far we are not seeing it in any meaningful way, and in fact many ranges are still decreasing.

New Listings We are Working On

Our team has been working on several nice listings we will be bringing to the market soon.  What is different now than in years past is it seems to take sellers longer to make their decision to sell. Many factors go into a decision to sell and sometimes a lot of things need to happen first.  We work with sellers to help with these details.

We have a new program for sellers that allows them to purchase a home first then sell their existing property with no interest or payments for 6 months on their existing home.  With the correct marketing plan sellers receive Top Dollar in this market.  The biggest mistake we see sellers make is believing the market is hot, so they will automatically receive top dollar.  There is a difference between selling for a number you would settle for versus selling for the top end of what the market will pay.  Sometimes that difference can be tens of thousands of dollars or more.

To find out what your home is worth, go to www.SWFLhomevalues.com  This is a starting point.  Often, we are selling homes above appraised value.  You can speak with Brett or Sande Ellis at 239-310-6500 and we can discuss how much we could really sell your home for, where you would go, and help with those details that impact whether it is a good time to sell now or not.  Believe it or not, it is not usually the price that matters to sellers.  Working out the details of how a sale would work is usually the biggest obstacle.  Many people would like to sell if only they had someone to help them with all the details.

This is where the Ellis Team comes in.  We look forward to working with you to manage all those details and get you Top Dollar.

Good luck, and Happy House Hunting!

Last week we wrote about how common mistakes cost sellers thousands at closing and we got a lot of response.  We also heard from buyers throughout the country asking for help getting buyer’s offer accepted in low inventory markets.  We thought we would write some tips for the buyer side to help them.

Getting Buyer’s Offer Accepted in Low Inventory Markets

In a low inventory market, you must make your offer stand out to the seller.  One of the biggest mistakes buyers make is upping the purchase price without regard to their ability to pay more.  Sure, they may have a pre-approval letter showing they qualify for more, but that does not help if the property does not appraise more when getting a mortgage.

Your Competition is Other Buyers-Not the Seller

Keep in mind, you are not competing with the seller.  The buyer is competing with all the other buyers wishing to purchase the same property.  A cash buyer does not have to worry about an appraisal. A buyer putting 50% down may not either.  Buyers putting a minimal amount down do, unless they can show sufficient cash they are willing to plunk down in addition to their down payment and closing costs to make up the difference.

One buyer called me from another state asking for advice in another market.  They had the chance to buy a home there for $450,000 but did not jump on it right away.  They waited a day, and 13 offers came in.  Ultimately it sold for much more than what they could have sealed the deal for.  Waiting cost that buyer.

They have their eye on another property.  He asked if they should put a quick timeline for acceptance on the offer and threated to withdraw it if it is not accepted.  My response was, not necessarily.  The buyer is not holding all the cards.  It is to the seller’s advantage to slow play the offers to generate more interest.  Taking an offer too soon may cost the seller.

Seller Can Act at Any Time Regardless of What They Stated

The seller may say they will look at all offers on such and such a date.  This may be true, but keep in mind the seller can also accept an offer before that date if they choose to.  If you make such a compelling offer that the seller is worried that offer will disappear, you might be able to get your offer accepted.  Do not threaten it will disappear as that will turn off the seller.  Remember, the seller is not your enemy, but they are the gate keeper.  They have what you want, but the other buyers are your enemy.

Negotiating Tip

I would rather softly tell the listing agent we have a certain amount of time to accept simply because the buyer has been shut out on other properties and does not want to miss out again.  If this deal is not going to happen, we would rather find out sooner than later as there is another property they are considering.  Your home is our first choice, and they would be absolutely thrilled to buy it.  If the seller takes too much time, we must move on so the buyer does not end up homeless.

Keep in mind, the buyer still is not holding many cards.  It is just a softer way to proceed and may help your chances.  Relationships matter in this market more than ever.  If your buyer agent is experienced it helps if they have done transactions with the listing agent in the past.  A listing agent’s confidence in the buyer agent can go a long way to getting a deal together.  Buyers must be educated and soothed, and an experienced agent is better able to help with that, and listing agents know this. Trust between the agents can make all the difference.

Other Resources

We wrote an article back in 2012 that still has some great tips today entitled “Top 10 Tips For Buying a Home in Today’s Market” you can find on our blog at https://blog.topagent.com  Just search for that title in the search bar.

Another great article “Selecting Best Multiple Offer Tips From a Real Estate Pro” can be found here.

We hope these tips help.  Always call the Ellis Team at Keller Williams Realty 239-489-4042 or visit www.LeeCountyOnline.com for the latest listings.

Ellis Team Weekend Open Houses

Open House Saturday and Sunday 12-3 PM

Cape Coral Waterfront Pool Home

2200 SW 49th Ter Cape Coral

 

Just when you thought you had seen everything, along comes another change in the real estate market.  We are seeing SW Florida home builders changing sales tactics again, and it’s not good news for the buyer.

Builders Changing Sales TacticsTo mimic the success home sellers are having through their Realtor, several home builders have instituted a highest and best offer format on their homes.  Basically, it works like this. The buyer makes a binding offer on a lot.  There is typically a stated priced however the buyer can offer highest and best.  The winning bidder chooses the home they want built and they go to contract.

Buyer Pays the Difference

If the home does not appraise, buyer agrees to pay the difference.  Once you bid up the price, you’re buying it regardless of whether you pay cash or finance it.  If the buyer is financing it, they will have already been pre-approved to bid on the property and shown financial ability to pay what they are biding.

Previously, home builders have been limiting sales contracts so they could keep up with price increases and maximize profit.  Home sellers may have shown builders the way as builders want in on the fun as well.  All of this puts additional pressure on buyers because they do not know what it’s going to take to win the bid.

I spoke with a homebuilder who used this in another city in Florida.  The lot had a $25,000 stated lot premium and was offered out for highest and best.  The winning bidder bid it up to $170,000 and won the bid.  They then went to contract with the house on tip of that plus options.

The builders argue that it is not fair to sell to whoever shows up first.  They are getting as many as 100 people per day through their model homes.  That is 700 per week.  If a builder releases 2 lots and calls for highest and best, they now have 700 from this week, and thousands from previous weeks who have seen the property.  Builders love this because not only are they raising prices on the house as costs rise, but they are also maximizing value on the total package.

New Construction Prices Will Pull Resale Prices Higher

Rising new construction prices can help pull resale prices even higher when you have such limited supply and strong demand.  It used to be when building prices got too high people would switch over to resale and vice versa.  Now there is no switching.  Buyers must jump on the first home that meets their needs and come with their best offer.

Buyers are not competing with the seller, or the builder.  They are competing with other buyers.  We have great tools on how to win bids when you are not holding all the cards.  These tools help, but they are not an automatic win for buyers in every circumstance.  You’ve got to play the cards you are dealt, and a great Realtor can help you play them as best as possible.  If you are a buyer, call the Ellis Team at Keller Williams Realty 239-489-4042 or visit www.LeeCountyOnline.com

If you are a seller, you need an experienced Realtor.  Buyer agents are trying all kinds of tricks and shenanigans trying to win deals.  Some are legit, and some are not.  An experienced agent can keep you from going down the wrong path with the wrong buyer.  If something doesn’t seem right, you need an agent with experience to sort that out.

Getting Top Dollar For Your Home

With builders changing sales tactics, so too must home sellers. There are additional ways to maximize your sale price.  Brett and Sande Ellis know how to do this as well.  If you are looking for Top Dollar, call Brett or Sande Ellis 239-310-6500 or visit www.SWFLhomevalues.com to see what your home is worth.

Do you know what your home is worth?  If you haven’t checked in the last week, then you really don’t know.

We have many happy home sellers that are glad they called the Ellis Team at Keller Williams Realty.  Let’s talk and see if we can help you too!

Ellis Team Open House

Cape Coral Waterfront Pool Home Sat 12-3 PM

You would think rising home prices would decrease home affordability.  This simply is not the case as the home affordability index nears all-time highs.

Home Affordability Index Nears All-Time Highs

If you look at the chart, home affordability was greatest back in 2012.  Median home prices averaged $131,000 for the year compared to $289,000 in 2020.  Today home prices are higher, so we took the yearly average.

So, what would cause affordability to rise if home prices are also rising?  Interest rates.  Lower rates equate to a lower mortgage payment, and it offsets the rising cost of the home.  Therefore, we are saying there is more room for further price increases.

Home Affordability Index Nears All-Time High

The home affordability index currently stands at 16.  It went as low as 13 in 2012 and hovered below 16 for 5 years.  The other thing that is different today is that we have end users for every home and rental.  Back in 2005 we had speculators bidding up prices to flip with no real end user in sight.  It was a house of cards. Today’s market is no house of cards.  We have legitimate demand.  In fact, we have more demand than supply.

Even if rates rise, we have room for that in the index.  As you can see, traditionally the index stands between 19 and 22.  At 16, we have some room if rates rise.  If interest rates do not rise much, we have room for further price growth.

Furthermore, we believe Florida has been undervalued for years relative to what it brings to the table.  Sunshine, low taxes, and freedom to work are just a few, and people are taking notice.  With the transition to work from home jobs, Florida is on the radar.  We just might see affordability numbers rise above their traditional numbers of 19-22.  That makes sense to us.

Of course, nobody knows what exactly will happen.  We do not know how much the price of oil will increase, what interest rates will do, and how the economy will react.  We do not know if northern states will continue to increase taxes, and we do not know what Covid-19 will do.  What we do know and are observing all looks favorable to Florida.

Our best advice for buyers would be to purchase as soon as you can.  As prices rise, and interest rates rise, your next home will inevitably cost you more than it does today.  If you have a home to sell, think about doing it now.  Waiting to get more money down the road will only cost you on the buying end.  It may cost you more in higher rates than you will receive with a higher price.

Our best advice to sellers would also be, do it now.  You are in the driver’s seat, and that’s a fun seat to be in.  While the market looks on the up and up, we never really know how long these markets will continue like this.  While we can make the case for increased prices, the price gains may not continue to rise at the same rate we have just witnessed.

History shows us the market never gives advanced warning when it is going to turn.  Sometimes we see signs, and we report those.  We are not seeing those signs, but someday we will and there will be those that miss out.  It always happens and will until the end of time.  It is true in the real estate market and the stock market.  You can never time the top perfectly, just as you cannot predict a bottom perfectly.  It is only after it occurs that we can tell you with certainty.

If you are thinking of selling, call Sande or Brett Ellis at 239-310-6500 or visit www.SWFLhomevalues.com for an instant home valuation.

See last week’s article “National Housing Supply Shortage Predicted Years Ago

Good luck, and happy selling!  Don’t miss this market!

New Opportunity in Whiskey Creek

We are writing this article the morning after the election.  At this time, it is unclear who the next president of the United States will be or when we will know.  What we do know are the real estate statistics pre-election.  Today we decided to focus on pre-election dollar volume for the SW Florida real estate market.

Pre-Election Dollar Volume SW Florida Real Estate Market

Pre-election dollar volume measures the total dollar volume of sales in a defined time period.  We calculate this by adding up all the sales volume in each month.  September 2020 SW Florida saw $564.8 million dollars in total dollar volume.  That is a whopping 63.4% increase over 2019 numbers which were $345.6 million.

Pre-Election Dollar Volume up in Summer

Pre-election dollar volume started taking off back in June.  Keep in mind we have been in the middle of a pandemic and we are still eclipsing 2019 numbers.  2019 is the benchmark, and we know that was a good year in real estate in SW Florida.  June was only up 1.5%, but it started a trend we will look back on as a defining moment.  July posted a 20.1% increase in pre-election dollar volume in real estate sales.  Along came August which blew June and July away.  People thought the market could not get any stronger, and September would prove them wrong.

New pending sales in September are 58.2% higher than 2019.  We know you must have a pending listing before you can have a closed sale.  New pending sales are a leading indicator of what may happen 1-2 months down the line.  Because many home loans are taking a minimum of 45 days to close, many of the September new pending sales will close in December. August new pending sales were up 42.4%, so we believe October official numbers when released will show increases as well.

We may not see a rise of 63.4% like we saw in September, but October numbers should rise compared to 2019.  We have seen excellent demand.  One thing that could limit sales would be limited supply.  The other factors that will influence the market going forward is how people feel about the eventual winner, and the makeup of congress.

Will economic policies spur growth?  How will northern states react to the winner, and will they continue moving to Florida?  Will that pace speed up or slow down?  How many people will decide to list their home post-election?  All these factors will play a role in the total dollar volume moving forward into 2021.

Waiting on a Winner

Once a presidential winner is determined, it may take people awhile to digest how they feel about it and how future economic, social, and tax policies will affect homeowners.  This may vary by state and county.  We have seen a migration away from high tax states to low tax states. We do not know if other factors will come into play post-election.

It would be impossible for anyone to predict how the SW Florida real estate market will fare going forward.  Heck, as of today writing this article we cannot even tell you who the president will be or who will control congress.  We can report that pre-election dollar volume was excellent in SW Florida and on the rise.  It should remain great for another few months.  Other indicators have been excellent as well.  Right now, SW Florida has an exceptionally good real estate market.

If you would like to talk about selling your home, please call Sande or Brett Ellis 239-489-4042 Ext 4.  We can discuss your options, how the overall market is doing today as well as your neighborhood and put a game plan together for you should you decide to sell.  Or, you can always get an instant value of your home at www.SWFLhomevalues.com It’s instant and easy.  We can validate the online price in person if you are considering selling.  Your choice.

Always call Sande or Brett Ellis at the Ellis Team Keller Williams Realty! We’re never too busy to talk to you.  Good luck and Happy Selling!

Ellis Team Weekend Open Houses

Saturday Nov 7th 12-2 PM

11685 Kati Falls Ln

 

Sunday 1-4 PM

13825 Bald Cypress Cir

13876 Lily Pad Cir

 

 

Like Southwest Florida, the United States housing market has fared very well in 2020.  A robust economy pre covid-19 and low interest rates are two factors that have fueled the real estate market locally and nationally.

We like to analyze data that may affect the market now or in the future.  When looking at national unemployment numbers we see that unemployment is falling fast and steadily from its peak in April.  The last time we saw double digit unemployment was 2009 and it took 4 years to fall just 2.5%.

United States Housing Market Not Affected From Unemployment Yet

We know that our current unemployment rates were forced by the Coronavirus outbreak and was precipitated by forced shutdowns.  It is not surprising that we are rebounding so fast and steadily., and yet we know that anyone who lost their job probably lost their ability to pay for housing for any length of time.  Thank goodness we had a good economy going into this thing.  Imagine how tough this would have been financially back in 2009.

United States Housing Market Unemployment By Age

Secondly, we like to look at who was most affected by job loss, as that may leave clues as to what is ahead for the United States housing market. The hardest hit segment is the 24 and under segment with current unemployment at 14.1% They make up 3.0% of all home sales in the United States housing market.

The 25-34 age group has 9.7% unemployment and make up about 25% of all home sales in the United States.  Lastly, we see the 35+ group with 6.8% unemployment.  They make up 72% of all United States housing market home sales.

Home Sales are Strong

This might explain why home sales have been so strong.  The majority of home buyers have been the least affected by unemployment. Low interest rates have helped offset any losses by affected home buyers.  Still, 8.4% unemployment and rising home sales may not be sustainable forever.  The good news is unemployment should not stay at 8.4% as those numbers are declining rapidly.

We plan to watch these numbers as they should leave clues about what is ahead for the United States housing market.  One potential scenario is it could hold back move-up buyers.  The 25-34 age group tends to be first time home buyers, and if a significant number hold off purchasing their first home it could impact down the road some move-up buyers who are ready to make their next move.

If the economy keeps improving and we get the service sector back to work, this should all work out.  Question marks remain how the travel and tourism segments will fare and people’s willingness to travel until covid-19 is under control.  Optimism in the vaccine and treatment fronts abound and this could help that segment recover sooner if therapeutics or prevention pans out.

Florida Looking Good for the Future

While the United States housing market may max out at some point until the economy recovers, Florida is looking rather good as many from out of state have found Florida desirable.  Florida is a net migration state from other states, so we may buck the trend if the national United States housing market maxes out someday.

At last check Lee County single family home inventory is down to 2.36 months supply of homes on the market.  Buyers must be quick and decisive to score a home in this market.  Sellers must be wise and patient, making sure they select the best offer for them, not necessarily the first offer that tried to box them into a quick decision.  This is where experienced agents come in.

Experienced buyer agents know how to make your offer as strong as possible.  Looking at it from the seller’s eyes is extremely helpful now, and therefore experience matters.

Sellers need experience now more than ever, so be careful trusting your home sale to an agent with little to no listing experience.  If you would like to speak to Brett or Sande Ellis about the process, we’re available.  Simply call 239-489-4042 Ext 4, or visit www.SWFLhomevalues.com to get a Free estimate of your home’s value.

Good luck and Happy House Hunting!

See last week’s article “Florida Real Estate Demand Heats Up From High Tax State Residents

Ellis Team Weekend Open Houses

Open House Saturday 12-3 PM

1453 Mandel Rd

6414 Royal Woods Dr

Open House Sunday 1-4 PM

7706 Bay Lake Dr

SW Florida seller’s market fuels rise in home sale prices.  Hot home sales and declining inventory along with low interest rates have caused this seller’s market.

Eventually it had to show up in prices.  Median home sales increased 9.4% over last year while average prices increased 8.5%.  This is July over July numbers, not July over June 2020 numbers.  This tells us prices are on the move.

Seller’s Market Fuels Rise in Home Sale Prices

Seller’s Market Fuels Rise in Home Sale Prices

Rising prices are a good thing for home sellers, but not necessarily a bad thing for home buyers.  Waiting may be a bad thing for home buyers, but not rising prices itself.  The reason is interest rates have helped increase affordability, which means buyers can afford more purchase price for the same monthly payment.  The only thing that may hold some buyers back is the larger down payment.

We are seeing buyers asking for closing costs because they are having to put more down payment up due to rising prices.  This is one reason buyers should look to purchase sooner than later, because their down payments will keep going up with rising prices.

High Tax States Losing Residents

Secondly, we are seeing buyers purchase in Florida from other states.  New York city is losing residents in droves.  In fact, you cannot even get a U-Haul to move out of the state right now in New York City due to high demand.  Vacancies in New York City are rising fast.

New York City is not alone.  It is darned near impossible to grow a business with high taxes, shutdowns, riots, and violence.  One of these factors alone puts pressure on businesses and combined it is becoming the fatal blow.  Some people speculate these factors may result in the downfall of our cities.

Residents are voting with their pocketbook and they are getting out of Dodge.  People want to feel safe and feel like they can live and work in a place with opportunity.  Florida is one of those places people are choosing to move to, among others. The SW Florida seller’s market fuels rise in home prices.

What this means for home sellers in Florida is this is the best seller’s market we’ve ever seen.  It is always better to sell your home when there are many buyers and few sellers to compete with.  Even computer valuation models are picking up on the rising prices.  One of the best is www.SWFLhomevalues.com  You can receive a free estimate of your home’s values in seconds.  The site will even display a confidence score.  The higher the confidence score, the more accurate the valuation tends to be.

Getting Top Dollar For Your Home

Getting Top Dollar for your home is a science best left to experienced agents.  In this market you are likely to encounter multiple offers if the marketing is done correctly.  Experienced agents know how to get the most out of multiple offers and have the wisdom to know which offer to take.  One of the deadly sins homeowners make is selecting the wrong offer.  Each offer is a gamble, so selecting the right offer is critical.  It is not fun to go 45 days into a transaction and find out the buyer or the buyer’s lender cannot perform under the terms of the contract.

We receive offers all the time from inexperienced agents that have no idea the offer they wrote will not fly with the lender.  Sellers can pay closing costs, but each loan program is different.  We had to restructure a loan the day before closing because buyer did not have minimum amount down and could not benefit from agreed upon closing costs for a repair.  I asked the buyer agent to check with the lender before we agreed to the change, and she said she did.  She did not realize how something like this could kill a deal.  Now she does.  It is not her fault; she just did not have the experience to know better.

Therefore, hiring the right agent upfront can make all the difference.  We got it done, but it took a lot of work at the last minute.

Always call Brett or Sande Ellis 239-489-4042 Ext 4 to get your home sold Fast and for Top Dollar!

See last week’s article “Closed Home Sales Back on Track After Shutdown

Seller’s market fuels rise in SW Florida home prices, and it could last awhile with interest rates expected to stay low through 2021.

New Ellis Team Listings

High Point Place

2090 W First St #H2908

Reflection Lakes

7706 Bay Lake Dr

Part of any successful advertising campaign should include the ability to identify and target people most likely to buy a product.  The Ellis Team uses targeted real estate advertising as an additional way to sell homes for top dollar.

Let’s say your company makes the best dog treats on the planet.  You would want to target pet owners, and more specifically dog owners.  It would do no good to target cat owners if cats do not like the treat.  When we list a property, we try to think like a buyer.  If I list an 800 sq. ft home, chances are 8 roommates are not going to buy it.

In the covid-19 era we know many people lost their job, so they are not in the market to purchase right now.  Others who kept their job may want to take advantage of the low rates.  Still others do not need a job to purchase.  It gets complicated.  What we do know is an owner has hired us to find a buyer for their property.

As aggressive real estate marketers the Ellis Team casts several nets.  Our newspaper, PPC, radio, TV, social media, and direct mail campaigns cast a wide net.  We advertise the property to anybody and everybody hoping to find one or more buyers who show interest.  We call this the shotgun approach.

Additionally, we cast tighter nets.  We call this the rifle approach.  Lately we have been targeting cities up North where we know buyers are selling and leaving.  We talk to agents daily who tell us they have sellers leaving their state and they are not coming back.  Florida is one of the areas they are moving to. We have the ability to advertise our listings anywhere in the country.

Targeted Real Estate Advertising

Targeted Real Estate Advertising Selling Homes for Top Dollar

Targeted Real Estate Advertising Selling Homes for Top Dollar Wildginger Dr

The graphic shows two separate ads we ran this past weekend.  As you can see, these two ads generated 40 buyers in just one weekend.  Keep in mind, we are showing you just 2 of the out of town ads.  We may run more ads than 2, and we also run local ads for buyers who have an interest in real estate.  I count 61 buyers signed up just last weekend alone.

By casting multiple nets, we have been able to accumulate a significant amount of people interested in buying property here in SW Florida.  This data is useful because our team of buyer specialists can see what they are searching and call them with new properties entering the market.

It works like this.  Let’s say Sande or I go on a listing appointment and the seller wants to sell.  We know they will have their home ready next week to put on the market.  Our buyer agents can begin calling buyers in our database ahead of time letting them know that a seller will be listing their home next week in an area they are looking in.

We May Already Have a Buyer

Our team may already have the buyer for that listing.  We acquired that buyer through endless marketing, both during the time of the listing, and even before we took the listing.  Sellers benefit from the previous marketing our team has done because we keep the database of buyers.  This database is so valuable because it not only includes their name, email, and phone number, it also tells us what they are searching for and what they like.  Our agents can search the database and find buyers quickly.

Do not call us if your home is listed with another Realtor.  We offer this service for Ellis Team clients only.  We already know about the homes listed on the MLS.  Our buyers can see your home on our website. The Ellis Team proactively calls buyers when our team lists a new property to MLS.  Those sellers hired us, so those are the sellers we spring into action for.

If you’re thinking of selling and want to talk to us about the process, call Brett or Sande Ellis 239-489-4042 Ext 4, or visit www.SWFLhomevlaues.com for a Free instant online estimate of your home’s value.  Find out how targeted real estate advertising can help your home sell for top dollar too.

Good luck and Happy Selling!

See last week’s article “Total Real Estate Sales Volume Bounces Back for the Year

Ellis Team Open House

Open House Sunday 1-4 PM

14120 Reflection Lakes Dr

14120 Refletion Lakes Dr
Open House Sunday 1-4 PM in Reflection Lakes Fort Myers

New Listing – Video Walkthru

5259 Skylark Ct

 

It is no surprise that real estate transaction dollar volume dropped in May.  May closings were a result of March and April pending sales which were impacted by covid-19 and stay at home orders in Florida.  Going forward, new pending sales have been strong, and top agents are having an exceptionally good year.

Real Estate Transaction Dollar Volume Drops in May

Dollar volume is the number of transactions multiplied by the average sales price.  That number dropped from $569.1 million last year to $326.0 million this year.  That is significant.

One of the things holding down sales is the limited inventory.  The other is travel has been limited during this period from other states.  That is not to say the motivated didn’t find a way to get here and purchase, but it did limit many.  Properties at the lower to mid end have been doing well.  Because of this, it has pulled the median price down .7% and the average price down 6.2%.  I would not say prices are falling though.  Right now, it is more of the mix of properties that are selling that is causing this.

We have seen this pattern before.  When real estate transaction dollar volume drops, it is not long after that agents start looking for the exit door.  These agents do not head directly for the door, they take a detour.  First, they are attracted to low cost brokerages with higher splits and fees based per transaction versus monthly.  It is an attempt to salvage their fledgling real estate career, and it does not work.  They were struggling before the crisis, and the real estate transaction dollar volume drop exacerbates it.

The detour is simply a speed bump to slow down the inevitable.  The exit door is approaching.  Sellers should be leery of listing with an agent who does not have listing transaction experience and has not had recent sales.  One question you might ask is, how long you have been with your current company?  Another would be how have your sales been in the last two months?

If you are considering selling, we have a list of questions you should ask the Realtor you are interviewing before you sign any agreement.  Another tell tale sign is when they agree to cut their commission.  This tells you two things.  Number one, they need a deal badly, and since profit isn’t a predominant factor, survival is, they may not be around by the end of the transaction.  Secondly, if they cannot negotiate their own transaction, how in the world can you trust them to negotiate on your behalf? Lastly, if they say they can do it for less, you must wonder if they’re spending money marketing your home, or just relying on the price and MLS to sell it.  If they don’t do anything for you, why pay them anything?

The whole point of using a Realtor is because they put more money in your pocket at closing than selling By Owner does, and that is a fact.  Realtors spend money, and each has their own value proposition.  If their value proposition is dropping, it means their value to you as a seller is dropping too.

Before you shortchange yourself and hire the least expensive agent you can find, call us, and explore the difference.  If netting more in your pocket at closing is more important than the low fee you pay, we need to talk.  Most people believe the less cost you pay the more money should flow to your pocket, and that makes sense.  The only problem is it is not necessarily true.

Brett and Sande will answer your questions and show you how we are able to get more money for our sellers.  In times like we are in today, experience matters.  Put the experience of Brett and Sande Ellis to work for you.  239-489-40402 Ext 4 or email us Brett@topagent.com or Sande@topagent.com

We’re excited to talk to you!  Good luck and Happy Selling!

See last week’s article “Hurricane Damage Roof Claim Settlement Deadline Approaches

Ellis Team Open House

Open House Sunday 1-4 PM

14120 Reflection Lakes Dr

New Listing in Reflection Lakes
Open House Sunday 1-4 PM

 

 

We thought you would like to know some changing real estate trends we are watching and how we are adapting.  This is only the 2nd time in my 30+ years in real estate I can remember changes so significant like we are seeing today.  The trends we are seeing today in are different than normal economic cycle’s ebb and flows.

The last changing real estate trends we saw was back on 9-11, 2001 The United States was rocked by an enemy.  The country banded together, and Americans decided it was safer to nest at home versus travel abroad.  So, they did.  People hunkered down, traveled to within driving distance of their home and made home renovations, because home is where they were going to enjoy life and their family for a while.

Changing Real Estate Trends

Today, we are seeing similar tendencies.  Cruises, airline travel, and International travel are scary to many considering covid-19.  Workers learned to work from home, and companies learned it’s feasible.  Once companies learned this, they also learned they can save on high cost lease space in the city and setup shop in either the suburbs, or far away from where they originally thought they must be.

Two things happened.  Workers realized if they could work from home anywhere, why be in the city, and why be in high tax states?  Why not move to warmer climates that are tax friendly?  Not long after that, companies realized the same things.  If our workers are moving, why couldn’t we?  Companies have been reluctant to move for fear of displacing so many workers and not having talent in the location they might move to. Now that workers are willing to move, combined with fact they can still work and not have to live where they work opened the doors for companies to explore options.

Then another thing happened; the unfortunate death of George Floyd, the protests that ensued, and more specifically, the riots and mayhem.  Combine this with talk of disbanding police departments and it sent some companies over the edge.  Companies like steady, predictability. Chaos and mayhem are not business friendly.  The thought of closing stores, losing inventory, and putting employees in harms way was too much to stomach, and many businesses are leaving.  It’s not good business practice to operate in unstable environments.

This is also a reason why some companies are relocating from China back to the US; predictability and stability.  So, who benefits and who loses in such a scenario?

Florida is Attractive to Buyers

States like Florida are big winners.  Florida has done well with covid-19.  Riots have been well contained in Florida and leadership at the state and local levels have been strong.  Sure, some will always disagree with this stance or that, but leadership itself has been strong.

Consumers are looking to migrate out of cities and move to suburbs, smaller towns as well as rural. RV sales have picked up tremendously.  RV dealers are practically sold out in some cases.  I checked with an RV dealer locally who confirmed sales are off the charts and they are having a hard time keeping inventory.  Sound familiar?

Gun sales have increased.  People are worried they may rely less on the government for protection.  The events of 2020 may shape real estate decisions in a way we have not seen since 2001, and this time it appears to be more dramatic.

People crave predictability and stability.  Companies do too.  When they do not have that, they take control to the extent they can, and that’s their family’s personal safety and housing.

Changing Real Estate Trends We are Watching

Shifts in Advertising

We have shifted our advertising.  We still advertise locally, and we are bumping up our advertising into areas where we know people are migrating out.  It is working.  We have buyers coming in from all over.  Our artificial intelligence can identify where buyers and referrals are coming from for any city.  For example, here is the map for incoming referrals to Tampa.  Each city has its own patterns.  Hire us and we’ll put the SW Florida data to work for you.

The Ellis Team is forging relationships with top agents in each of these cities, as well as taking out targeted ads directly to buyers in those cities.  They are coming here and buying.  Our team sold 3 homes last weekend to leads we have been working using targeted ads.

If you are thinking of making a move, call Sande or Brett Ellis 239-489-4042 Ext 4, or visit www.SWFLhomevalues.com to see what your home is worth, or www.LeeCountyOnline.com to find your next home.

See last week’s article “Agent You Choose Matters When Listing Your Home

Agent You Choose Matters When Listing Your Home

Ellis Team Open House