Increasingly more and more consumers are finding us and working with our agents from social media. Here is an update on some of our social media efforts and where you can find us. Back on June 21, 2010 we wrote a blog article about our recent videos and our SW Florida Real Estate Video Channel which hosts our Future of Real Estate show as well as video updates we provide on SW Florida real estate. Back then we had 29,940 video views. Today we’re at 33,370. This doesn’t account for videos we upload other places, like Facebook and others. It looks like we received about 3,430 video views on YouTube alone since the end of June. We look for that rate to increase as we really haven’t promoted that channel in recent months.
Next week we plan to interview Lee County Sheriff Mike Scott. We’ll ask him about budget woes and how his department will cope in this tenuous financial environment. We’ll also ask him about immigration and how his department works with ICE in dealing with illegal immigrants, and how Arizona’s and Virginia’s laws impact how a sheriff does their job in law enforcement.
Whiskey Creek is one of Ft Myers long standing prestigious communities established back in the early 80’s era. Before Whiskey Creek, the prestigious areas of Fort Myers were off McGregor, Ft Myers Villas, and Tanglewood to name a few. Back in the 60’s and 70’s smaller homes were prevalent with shag carpets and lime green or yellow counter tops. 2 Bedroom homes were very common. Povia Ballantine was a builder here in SW Florida and you could always spot one of their homes by the door knobs which were usually yellow speckled, and many were in the Villas, Cypress Village, and other communities.
Whiskey Creek Subdivision, Fort Myers FL
As the economy and market emerged, McGregor area continued to build up south of Colonial, and the high end dollars transitioned to Tanglewood with the bigger yards and larger floor plans. After Tanglewood, Whiskey Creek emerged.
Whiskey Creek is divided by Whiskey Creek Dr, and one side featured custom homes by various builders and the other was predominantly US Homes. This is why there was a difference in values based upon location and features which still exists to this day.
Whiskey Creek Home
What’s really interesting is the amount of interest Whiskey Creek receives to this day, which could be a function of owners maintaining their yards and landscaping so well, the mature trees, the oversized yards as opposed to today’s newer subdivisions, or the central location to everything via McGregor, College Pkwy and Summerlin Rd.
It’s amazing to me when young families call us and only want to look in Whiskey Creek to raise their family because one of them grew up there as a child and wants that same location to raise their children.
Currently there are 31 homes on the market priced from $160,000 to $849,000. There are 4 pending sales priced from $169,900 to $279,000. Since the beginning of the year there has been 26 closed sales priced from $108,000 to $875,000.
Of the 31 homes on the market, 9 are short sales, and 2 are bank foreclosures. Of the 4 pending sales, 2 are bank foreclosures and none are short sales.
Of the 26 closed sales year to date, 3 are bank foreclosures and 1 was a short sale.
These numbers indicate a stable market with a reasonable number of distressed properties given the current climate. Some of the newer subdivisions have much higher rates than this. This may be another reason as a whole the neighborhood is maintained meticulously, and why it is so desirable. It also breaks the mold of today’s newer, cookie cutter communities.
Whiskey Creek offers what today’s newer communities don’t, which is yard size, mature landscaping, and that established feel. Combined with a perfect south location, we believe Whiskey Creek will remain a favorite for home buyers for years to come.
As we’ve been telling you in these articles, we expect sales to trend downward once official numbers were released, and that is the case. We still have some pretty good numbers though, and as you can see by the chart, the 2nd quarter of 2010 is the 2nd highest on record. 2009 was the highest on record. We’re still topping 2005 levels by a large margin.
Lee County Single Family Home Sales
Home sales fell 12% in June over last year, down from 1,705 last year to 1,501 this year. Last month sales were 1,460, so we actually picked up a few sales. Single family home prices were also up about 10% over last year. Median price this year is $96,600 in June compared to $87,900 last year. Prices were roughly even in May 2010, so prices pretty much held steady.
Condo prices also held steady, holding at $131,400. They were $131,900 in May, and $125,300 last June. Condo sales were up 11.11%
So what does all this mean? We have seen an increase in phone calls lately and an increase in buyer activity in the higher price ranges. This is a departure from last year when buyers only wanted the bargain basement homes. Buyers in the higher price ranges still want value and are not willing to overpay by any means, but at least activity is picking up. This can be attributed to the higher priced homes coming down in value and entering the buyer’s radar screen on where they perceive values should be.
Buyers don’t always have a realistic view of what properties are worth, just as many sellers don’t. The exciting time in the market is when buyers and sellers perception become closely aligned. It is precisely then that transactions can occur.
We would have more transactions occurring if more sellers could afford to sell. Many sellers just owe too much to sell at these bargain prices. Of course, if more sellers could afford to sell it would add inventory, so the market has a way of balancing itself out.
We don’t think prices are going back to 2005 levels any time soon, but at least prices are on the rise, and home sales are faring well. I’ve spoken with a few lenders who have said mortgage applications are down. This is true in SW Florida and nationwide. We have seen an influx of cash buyers again as banks are sometimes stingy with the money. We have seen some lenders loosening some of their lender requirements. There are some 100% financing loans out there and interest rates are down to about 4.25%
Some buyers have backed off because they lost out on the $8,000 tax credit. The interesting thing is, rates were 5.5% back when this program was in effect, so by waiting, a buyer would now save $54,612 in interest on a $200,000 loan. Not bad for waiting just a few months.
Will we ever see interest rates this low again? Will we ever see home prices this low again? Will we ever see them this low again together? I think the answer may be No to questions 1 & 2, and definitely NO to #3. Never before have we seen this much buying power in the market, and perhaps this is why home sales are still hanging tough. If you‘re a buyer, their really isn’t a better time to buy than now, and that is a fact!
It’s been a little while since we released the official SW Florida Real Estate Current Market Index. This index accurately predicts the near term forward direction of the local real estate market by analyzing current market activity against inventory levels and assigning a value. A lower index level indicates a hotter the market, and a higher number indicates a cooling market.
Ellis Team SW Florida Current Market Index
As you can see, the forward indicator heated up in February and we witnessed strong sales since that time. We have noticed a slight cooling trend since May. As we write this article official numbers haven’t been released yet, but we have spoken with several agents and loan officers who have also indicated a cooling trend since May.
At 4.94 the index still boasts very strong numbers; however the trend has been rising lately so we’ll want to keep an eye on it. One reason the market has cooled a bit is because bargain based foreclosure property inventory levels have fallen off which has cooled buying demand. SW Florida has been a price sensitive market and buyers are off the fence and buying because they perceive real bargains. The looming question has always been what will buyers do when the real bargains begin to dry up?
We have heard reports that banks will be unloading more foreclosures to the market soon, and already we are seeing that. Banks are not filing new foreclosures at the pace they once were, so we wondered how this could be true. The answer may be that the banks have not released the entire inventory they foreclosed upon in the past few years.
To give an example, we just pre-listed a bank foreclosure we’ll be bringing to the market soon. From the time an agent receives a pre-listing it can take 1-6 weeks or so before property is ready to bring to market. Several reports, valuations, and decisions must be made, and in some instances repairs, water hookups, etc before the property is ready for market.
This particular property had suffered some fire damage. The bank of course wanted a fire report from the fire department once they learned this new fact. Keep in mind, the banks don’t know what they’ve got on their hands until the appraisal and agent reports inform them. We obtained the fire report and determined the fire occurred back in 2007. It’s obvious the borrower has not lived in the property since 2007, and presumably hasn’t made a payment on a damaged property they weren’t living in.
So the question is, if the buyer wasn’t making payments, why did it take from 2007 until now for the bank to foreclose and/or bring the property to market. The bank is just now discovering there was a fire over 3 yrs ago in the property.
The answer is either the banks have held back inventory, or have just been too busy working their backlog. So just because foreclosure filings have been down in the past year doesn’t mean there couldn’t be more ready to hit the market.
In addition to the banks we’re dealing with, we’ve also been working on FNMA listings. We’ve been told by various sources to get ready for an influx of FNMA properties as well, and already we’ve been assigned several pre-listings.
Banks have been more diligent on short sales, but they’re still not quick enough. Short sale closings have been rising, but they’re still a drop in the bucket compared to the struggling homeowners out there.
With short sale closings rising, and the possibility of more bargains hitting the market, we could see the index drop again, but for now it is rising and we’ll want to monitor. Nationwide sales have slowed, so it’s not just a SW Florida trend. We’ll be watching sales volume and pricing trends closely in the coming weeks and update you.
In addition to providing data on the SW Florida real estate market, we thought it would be nice to highlight some local Lee County communities and explore what is happening in that neighborhood today. This week we’ll focus on Reflection Lakes.
Reflection Lakes Community in Fort Myers Florida
Reflection Lakes is conveniently located in south Fort Myers and boasts scenic lakes, special nature preserves, street lighting, community sidewalks and underground utilities all bordering pristine Lakes Park. The magnificent clubhouse sits on a lake and features a state of the art fitness center, billiards, administrative rooms, catering kitchen, heated community pool, children’s playground, 4 lighted tennis courts, basketball courts, sand volleyball court and a putting green.
Reflection Lakes Pool with Waterfall in South Ft Myers
Reflection Lakes is very close to Barbara B. Mann Performing Arts Hall, and is close to the beaches, US 41, and features easy access via Summerlin Rd.
Currently there are 30 properties for sale priced from $114,999 to $750,000. None on the market now are foreclosures. There are 4 pending sales currently priced from $134,900 to $329,900 and 3 of the 4 pending sales are foreclosures.
Because Reflection Lakes was built primarily in 2002-2003 before the boom in real estate sales, there wasn’t a lot of speculative investor activity, and this is why we haven’t seen a large concentration of foreclosures like we’ve seen in newer communities in 2005-2007. There are some foreclosures and short sales due to the downturn in the economy, as is normal throughout SW Florida.
Reflection Lakes Overlooking Lakes Park in Fort Myers Florida
So far in 2010 there have been 15 closed sales priced between $113,100 for a condo in Reflection Lakes to $350,000 for a single family home in Las Palmas, often referred to as the Estates II section of Reflection Lakes. This was a 4 bedroom, 3 bath home with 2,659 square feet of living area, a 3 car garage, pool and was lakefront.
All of the active, pending, and sold listings are posted at www.ReflectionLakes.com The floor plans are also provided, along with a site plan.
Maintenance fees for the single family homes are $159/mo and this includes cable TV, alarm monitoring, clubhouse, exercise room, pools, street lights, sidewalks, and all the amenities. Reflection Lakes even has it’s own TV channel for happenings and events inside the community.
A fact most people don’t know is Reflection Lakes has a private entrance into lakes Park. It’s not uncommon to see residents ride their bikes or take walks into Lakes Park, or enjoy kayak and canoe rides into the park as well.
The amenities, low HOA fees, floor plans, community activities, and superb location make Reflection Lakes worth looking into for buyers today. The community offers condos, town homes, villa homes, all the way to large estate homes, so there is a product to suit many lifestyles. Many people are surprised at just how much home they can afford these days, and with interest rates at all-time lows, now may be your chance.
Reflection Lakes is a gated community, so you’ll definitely want to call a Realtor to look around. Good luck, and happy house hunting.
Maybe you’ve received the e-mail making the rounds these days which states “Under the new health care bill – did you know that all real estate transactions are now subject to a 3.8% sales tax?” Of course I was alarmed because a tax on real estate would be just one more blow to the economy, as real estate contributes 32% to our nation’s GDP (Gross Domestic Product).
Upon searching factcheck.org I discovered this is partially true. According to factcheck.org “Democratic lawmakers decided on a new 3.8 percent tax on the net investment income of high-income persons.” They go on to write that the law is misleading, and it would be easy to see why anyone reading it would believe the 3.8% tax applies to everyone that sells a home. So the circulating e-mails may not have been intentionally misleading or malicious.
Furthermore, the 3.8% tax won’t apply to everyone. It will apply only to profit on the sale of a home exceeding $250,000 for a single person or $500,000 for a married couple filing jointly. There are some minimum income requirements too. The tax is not scheduled to go into effect until 2013, after the next election. We are not tax professionals, so we encourage everyone to consult with their own tax advisor.
It appears that Congress and the President have snuck in additional capital gains taxes on real estate. It is easy to see why this fact has not been advertised because it is not very popular with Americans right now.
Home Prices Slip
Median home prices are up over 9% from last year, but they did take a step back in May, down 4.53% from April’s numbers. The median sales price of a home stands at $96,900, down from $101,500 a month earlier but up from $87,900 last year. Home sales remained strong in April with 1,460 sales in May, which was up over last year’s 1,417 number.
Median Home Sale Prices Lee County Florida
We have noticed a drop in pending sales in June. We know that many sales have been delayed or fallen out due to the flood insurance expiration. Congress has not renewed the National Flood Insurance Program, so essentially it’s impossible to get a mortgage on properties that require flood insurance. One tactic people are using is buyers assuming the sellers existing flood insurance, if it exists. You cannot do this with hazard insurance, but it can be done with flood insurance.
We’ll keep a close eye on the SW Florida real estate market going forward. Oil has not hit here, and as we wrote last week, there are scientific reasons why it may not ever. We have lost one sale from a buyer who definitely wanted to buy a waterfront home but is waiting to see what happens with the oil spill. Between the oil, flood insurance, tax hikes, expiration of tax credits, and the like we’d hope that our government would be more proactive in stimulating real estate activity, because we know real estate sales stimulate the economy. At the very least, renew the flood insurance program and eliminate tax hikes on sales so people who want to purchase can again.
Here’s an update to our SW Florida Real Estate Video Channel. The Top Agent channel has received 1,661 channel views and the videos have received 29,940 views. We have videos posted other places, so this is just the videos contained inside this channel.
That’s a good question, and I guess the answer depends on which facts you believe. In the beginning we were told the spill was leaking about 1,000 barrels per day, and just this past week we’ve been told it is now 35,000- 60,000 barrels per day, which translates into 1.5 million gallons to 2.5 million gallons per day. The truth is BP hasn’t been very concerned with educating us on the true facts nor the scope of the problem in the Gulf.
I’ve been watching a lot of TV on the issue and reading articles and it appears that many experts believe SW Florida is located in what they call a “Dead Zone, or Forbidden Zone”. This is a confusing term because they also call the panhandle a dead zone because of the impact of oil and its effect on wildlife caught up in the oil. The “Forbidden Zone” they refer to in SW Florida has to do with currents, and the fact many experts believe SW Florida will be protected by these currents from the oil.
Gulf of Mexico Loop Current and Forecast Map
In fact, Dr. Jeff Masters who created Weather Underground wrote a blog article on how SW Florida is protected. He writes “the west coast of Florida from Tampa Bay southwards to the Everglades is at minimal risk of receiving oil from surface currents. It appears the ocean side of Key West as well as the East coast of Florida is at more risk than SW Florida due to the currents and land configuration.
So is SW Florida completely safe from oil? That answer is probably not. There is still a risk of a hurricane or tropical storm blowing oil into SW Florida, although not likely. Most likely a tropical system would help blow oil away from SW Florida. Dr Masters also writes that the protection in the “Forbidden Zone” only holds true for surface oil, and if in fact there are underwater plumes, this oil could get caught up in the Loop Current and could make its way anywhere really. Again, more likely would be the sensitive areas of the Keys and up the East coast.
The larger risk to SW Florida is the “Perception” that oil has hit, and this affects tourism and the economy. News reports indicate hotel bookings are down across the state as many people believe oil has hit, or will hit very soon and they’re afraid to book travel. The Reality is oil has not hit anywhere close to SW Florida, and likely will not anytime soon, if ever. Of course, misleading facts from BP and the government do little to soothe people’s fears, so their perception becomes their reality.
The reality is oil may not ever come here. The reality is oil has already hit other places, and likely will hit more places. Once word reaches out that SW Florida has been unaffected, other places loss could become our gain. My gut tells me nobody wins though, as tourists tend to shut off and believe the entire state is under siege. It’s possible in the future tourists will want to go where there was no oil, and that could become a future selling point for SW Florida down the road.
In the meantime, I think we just need to keep the word out that the oil is not here, is not close to here, and our beaches are safe and a fun place to vacation. SW Florida remains home to fantastic fishing, awesome beaches, excellent real estate values and a high quality of life.
It’s been 8 weeks since we last reported on short sales, and we’re happy to report short sale activity is up as we’d hoped it would be. Short sales make much more sense to all involved over a foreclosure as it helps preserve the sellers credit better, minimizes losses to the lender, and keeps the neighborhood in better condition.
I recently heard a funny quote “Why do they call it a short sale if it takes so long?” While I can’t remember who said it, it’s funny because it’s so sad. Hopefully with new initiatives in place we’ll see quicker turn-around times for short sales. As a CDPE (Certified Distressed Property Expert) we thought we’d share a few tips to help agents navigate this short sale process and make your deals quicker and smoother.
Foreclosures Vs. Short Sales in SW Florida Real Estate
There is a clause in the Short Sale Addendum to Purchase and Sale Contract entitled #5; Multiple Offers which reads “Unless otherwise agreed by Buyer and Seller in writing, Seller may continue to market the Property for sale and accept other offers and submit those accepted offers to the lender.” We are not attorneys and we are not giving legal advice. This clause seems suspect though and we encourage listing and selling agents to amend or supersede this clause.
A purchase and sale contract is between one buyer and one seller, and once accepted you can request the lender to take less than what is owed via a short sale. In a normal transaction a seller wouldn’t enter into multiple contracts with multiple buyers, so why would you muddy the waters and try that on a short sale? Selling the property to multiple people just seems unethical and one buyer may have legal remedies against a seller for employing such a tactic.
Quite often we see sellers accepting any offer that comes down the road, but the lender certainly would not agree to the short sale because it is so far below market value. The lender wants to minimize their loss, and only agree to short sales if it makes sense. Sellers would be far better off negotiating or waiting for a reasonable offer than to accept any old offer.
When you submit multiple contracts to a lender they mistakenly think it must be a hot property and hold out for more, and many times each new offer starts the process all over again, further delaying approvals. And keep in mind when you submit more than one contract, the seller may be legally liable to more than one buyer.
You don’t submit offers to the lender, only accepted contracts. A seller should really only enter into one accepted contract. A lender cannot do anything without an accepted contract between buyer and seller as the lender is not a party to the transaction and can’t sell to anybody. This could change if they foreclose, but until then they are just the lender.
If you’re a buyer the last thing you want is the seller sending in other accepted contracts. It would be far better to move on and go buy another home and not waste any time waiting or investing in inspections, etc. As a seller, it should also be the last thing you want as well as it can hold-up or kill your sale. From a practical standpoint we don’t even know why this clause is in the addendum, or why agents or sellers would employ this tactic.
The other advice we would give is to have the sellers completely fill out a financial questionnaire upfront before taking the listing. There is no sense wasting buyers and sellers time if the seller isn’t going to qualify for hardship with their lender. You’ll need all this information with the accepted contract anyway, so it’s best to do it upfront and save everybody time. Not only will this speed up your short sale, but it will also help you skip doing deals that should never be attempted in the first place. Buyers are skittish enough on short sales anyway, so why attempt one if it has no shot at success? We’ll bring you more tips on short sales in upcoming articles. By educating the market on what works and what doesn’t, everybody wins. Good luck buying and selling. We’re all in this market together, for better or worse, and it pays to work together for success.
We just posted two new videos of our Future of Real Estate show. The first segment, Pricing Your Home to Sell – Future of Real Estate demonstrates the Pricing target, which shows homeowners how well their property is priced depending on the number of showings, drive-up, and drive-bys. This graph is very informative and has been tested across North America with many Star Power Stars and attendees, which are the highest producing agents in the country. Brett, Mike, and Sande of the Ellis Team are Star Power Stars and and enjoy learning and sharing great ideas with other high powered agents.
We also talk about the expiration of the National Flood Insurance Program for the third time this year and what that means for closings in SW Florida, as well as a new Condo and HOA law that was signed by Governor Charlie Crist this past week. Also information on banks participating in the HAFA (Home Affordable Foreclosure Alternatives). Stay tuned to Topagent.com
The second video Featured Hot Listings – Future of Real Estate SW Florida features four new listings, one in Daniel’s Park which is a gated community in South Fourt Myers for $165,000, and other in Brandywine in Myerlee for $20,000, one in Carillon Woods and another in the Forest Country Club. We also tell you how to view virtual tours of all the Ellis Team Listings, as well as search the entire MLS for free.
