Grey Saturday

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We sincerely hope everyone had a wonderful Thanksgiving as we all have so much to be thankful for, even if times seem tough for many across SW Florida.  For those eager shoppers we hope Black Friday was a day to score wonderful bargains.

We were trying to come up with a name for the day after Black Friday this year and we decided on Grey Saturday, because official sales numbers were released for the Florida real estate and market and SW Florida scored mixed results, earning it the Grey Area status.

Fort Myers, Cape Coral Single Family Home Listing Inventory
SW Florida Listing Inventory

Last month we reported a change in direction in listing inventory and said we wanted to keep an eye on those numbers going forward.  For the 2nd straight month, listing inventory rose.  The numbers aren’t staggering as we’re talking about a difference of 231 homes, but it is a recent trend nonetheless.

Fort Myers, Cape Coral Florida Home Prices
Greater Fort Myers- Cape Coral Home Prices

Single family home prices were up 15% over last year, but they are down 7.69% from last month.  We are in a volatile market because agents can’t count on which closings will actually close in a given month.  Transactions are becoming trickier to count on as governmental regulations are holding up closings, causing delays, and wreaking havoc on the market.  It’s not uncommon for buyers to receive approval on their short sale and then walk from the deal because of the length of time, or because they became impatient and went for another deal more likely to close.

Banks have told us the foreclosure backlog was coming and we are starting to see more assignments in the 4th quarter.  Another large bank has told us to watch out for 1st quarter 2012 for even more.  These bank foreclosures may be just what the doctor ordered for our market though because in certain submarkets there is a feeding frenzy to buy.  We have short sales, and some traditional sales of which not all are priced at market value, which is typical in any market, up, down, or sideways.  We’ve had a lack of foreclosure properties as banks were stymied with the legal debacle of the robo-signing issue that caused them to go back and evaluate if they had legal standing to foreclose and the paperwork to prove it.

We’re starting to see rising inventory and it’s not because of foreclosures.  We are entering season which is a time when properties are gobbled up like a Thanksgiving turkey, so we’d expect to see inventory decline in the next few months even if the banks do release more foreclosure inventory.  SW Florida’s appetite when it comes to a bargain is insatiable, much like a Black Friday sale.

Last month we had Trick or Treat Day, so we’d like to see a solid direction in the market.  The past few months have brought ups and downs in median prices.  Combining the recent up and down price swings, rising inventory, predicted rising foreclosure activity, and tempering that with the upcoming season means we have a market to keep our eyes on.

We really believe we’re going to have a good season.  What good is a bargain basement sale to a shopper in an empty store?  Shoppers want inventory, and this year may be one of the last good years to get the bargain.  Even after a downward price drop of 7.69%, prices are still up 15% over last year’s prices.  The absolute statistical bottom of the market may have been last year, and we may look back on 2011 in years to come as a time when buyers say to themselves, “I wish I would have hung in there and bought that bargain.”

When the economy improves and lending standards get back to normal, we’ll all look back at 2010 and 2011 and say “I wish I would have bought more.”

Good luck and good hunting!

 

Bad Appraisals Blamed For Nixing Real Estate Deals

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Don’t let the headline fool you, we’re a big fan of appraisals.  The key word is accurate, competent appraisals.  So many times sellers want us to overprice a home and sell it to a northern or foreign buyer assuming they don’t really know our market.  What sellers fail to realize is buyers usually look at several developments, several homes, and study the market more than sellers do.  If you overprice a home, it will sit.  This is a price sensitive market, and when you price a home at or very near its value, activity heats up and properties move.  We often tell sellers even if we were to dupe an unsuspecting buyer into overpaying for a home; the bank is still going to order an appraisal before they lend money.  Not only do buyers tend to research the market but they have a backup with bank appraisal.  Some sellers say, “Well, let’s find a foreign cash buyer.”  Sellers don’t realize cash buyers research the market perhaps more vigorously than financed buyers do, so they’re really grasping at straws trying to sell an overpriced property into a price sensitive market.

Value is in the Eye of the Beholder
Your Home as Seen By Buyer, Seller, Tax Assessor, Appraiser

Just as some sellers need to research the market better, so do some appraisers.  In the past week I’ve heard several complaints from Realtors who’ve said a bad appraisal nixed their closing.  Sometimes banks use appraisal management companies who utilize appraisers from different markets who aren’t as familiar with the local market as local appraisers. We’ve had past clients ask us to market homes in other cities as far away as Pensacola Fl and we declined simply because we’re not experts in that market.  Out of town appraisers are at a big disadvantage and couldn’t possibly know everything they should about our market.

For instance, some waterfront canal property in Cape Coral brings more value than others.  Nearby neighborhoods in SW Florida may not be good comparables even though they are located right next to each other.  Computer models and unsuspecting appraisers wouldn’t always know this.

Many times when the bank is considering a short sale or pricing a foreclosure, they utilize a BPO (Broker Price Opinion) and/or an appraisal.  If either comes back too high, the short sale is rejected or the foreclosure is priced too high.  Recently we had an asset manager contact us because our BPO came in at one figure and the bank’s appraiser came in much higher.  After studying comparable sales used by the appraiser we discovered he used gulf access homes as comps even though the subject property was not waterfront.  He also used a deed in lieu of foreclosure sale which wasn’t really a sale at all; it was simply a homeowner giving the property back to the bank for the loan amount.  We submitted documentation to have the appraisal overturned so the bank can sell the home.

Bad appraisals can cost a sale at both ends.  If the short sale appraisal is too high, the price the seller’s bank accepts may be higher than the buyer’s bank who is lending money appraisal reveals, so the deal dies unless adjustments are made, which isn’t always easy or possible with new rules placed by the government.  These new regulations, designed to protect lending and real estate values are doing the opposite.  Rarely when government gets involved does anything improve, it just takes more time, more aggravation, and blown deals, which doesn’t stabilize the market.

If the lending appraiser comes in too low, the buyer’s lender won’t loan the money at the contract price, potentially scuttling an otherwise good transaction that should have closed.  There are lots of good appraisals out there which do blow some deals, which furthers our comment to sellers that it’s not wise to purposely overprice a property.  Keep in mind, value is in the eyes of the market, not any one buyer nor any one seller.  Values are subjective, and some properties are difficult to evaluate.  Not all sales are cookie cutter sales with multiple active and sold comparables.

It pays to study the market, and if you doubt the value, ask questions.  Sellers sometimes produce appraisals that are too high and the market won’t accept, and bank ordered appraisals are sometimes too low and not at actual market value.  Do your homework and question their work.  Request a copy of the appraisal.  You paid for it.  Some banks will let you see it.  And remember, keep an objective mind.  Everyone in the transaction has their own idea of what the value is, or should be.  Make sure that idea is supported by facts, data and logic and not ignorance of the market or motivations.

Banks Offering as Much as $20,000 to Short Sale Your Home

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Banks are contacting customers who are past due or in financial trouble and offering owners or tenants up to $20,000 in relocation assistance to move out of home and hire an experienced agent to sell the home as a short sale with a short term loan option.  Banks are also offering owners money to agree to a deed in lieu foreclosure in some instances as well.

Benefits of Short Sale Versus Foreclosure Chart
Alternatives to Foreclosure Chart

There are several advantages for taking the bank up on their offer.  If you let the property go to foreclosure, you’ll be evicted without relocation assistance.  Additionally your credit will suffer more in a foreclosure than a short sale or deed in lieu.  The owner is more in control when actively pursuing a sale through an experienced agent than giving up all control to the bank and the legal system.

A short sale is a commonly used alternative to foreclosure. Generally, when putting your home on the market, the goal is to market and sell your house for an amount greater than any and all outstanding liens against the property. Liens include all mortgages, escrows and fees on the property.

If you can no longer afford to make your mortgage payments and your house is worth less than you owe, a short sale allows you to sell your house at the current fair market value. You then have an option to move to a more affordable situation. In a short sale, the investor or owner of your loan must approve the sale because they are entitled to repayment of the loan and will be receiving less than the amount owed.

If you have additional liens on your property with other lenders, such as a home equity loan, all investors must come to an agreement in order to complete the short sale. This process takes time, and an experienced agent is required to navigate and negotiate through these challenges.

Another alternative is a deed in lieu of foreclosure. With a deed in lieu, you voluntarily transfer ownership of the property to your investor to satisfy the amount due on your first mortgage. In some cases, you may be eligible for a deed in lieu without first attempting a short sale of your home. A deed in lieu generally takes about 90 days, depending on your situation.

In either a short sale or deed in lieu you may be responsible for paying a deficiency.  There are many factors that determine this, such as if the home was your primary residence, what state you live in, your financial situation, etc.  Sometimes this can be negotiated with your lender.

In any event, most lenders agree it is much better on your credit report and they are likely to lend you money in the future faster if you agree to a short sale or deed in lieu instead of a full blown foreclosure.

If you’ve been contacted by your lender, it may be at least worth considering your options.  Don’t throw away documents sent to you by your lender.  If they make you an offer call your attorney for legal advice or an experienced real estate agent for advice on the program and assistance selling your home.

The banks really don’t want your home back.  They’d prefer that owners pay their mortgage payments.  When that’s not possible, it may be less expensive to offer the occupant relocation assistance and get on with the process of selling the home before it gets to the costly foreclosure process.  Once the home gets into foreclosure, the costs mount, the credit suffers, and owners lose options.

If we can help, call us at 239-489-4042.  Each situation is unique and it takes time to look into each program.  The good news is we have past experience with many of these programs.

 

Official SW Florida Sales Numbers Reveal Higher Prices

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Last week we reported we expected sales to be roughly even if not slightly behind 2010 levels when official numbers were reported.  Well, its official and we were wrong.  Sales actually increased by 25 sales over last year.  Single family home sales were reported as 1127 sales versus 1102 last year.

Fort Myers - Cape Coral SW Florida Homes Closed
SW Florida Homes Closed

We also reported listing inventory actually went up slightly by 43 units which was another change in direction.  It turns out the sales weren’t a change in direction, but it doesn’t matter.  Whether they were up or down 25 units statistically it’s not a big difference.  What was interesting was the first change in direction, and something we wanted to monitor going forward.  While we’re usually correct with our predictions, this time we were off on the sales numbers.

Home Sale Prices in Cape Coral - Fort Myers Florida
SW Florida Real Estate Home Sale Prices

There was another bit of good news in the official numbers.  Not only were sales up, but prices rose 17.6% over last year and 7.17% from the previous month.  This could be because home affordability is at an all-time high and buyers today can afford more home due to lower prices and lower interest rates than ever before, or it could be because there was less distressed this past month.  In fact, in September 50.77% of all single family home sales were distressed, down from 54.26% in August.  Those numbers were as low as 44.57% in June of 2011.  Banks have not brought significant foreclosed inventory to the market since the robo-signing fiasco, although we’re being told this may change in January as several of the large banks are able to bring more as they’ve worked through legal issues pertaining to those questionable foreclosures.

Pending sales were down last week, so we’ll have to see how this affects sales going forward, however they are typically down this time of year and start picking back up again going forward.  There is some seasonality in these numbers we like to account for, and this year is no exception.

We have noticed our roads are getting busier and our northern friends, sometimes referred to as snowbirds, have begun their trek to SW Florida, and judging by our phone calls and Internet leads, many are in search of their piece of paradise.  This could bode well for another strong season in the SW Florida real estate market.

Two new programs were just announced that will greatly benefit distressed homeowners.  One program allows underwater sellers to refinance their home no matter how much is owed if it is a FNMA or Freddie Mac insured loan as long as they’ve been current on their mortgage in the last 6 months, and another program that offers sellers up to $20,000-$30,000 in financial assistance to move and sell their home for less than what is owed.

We’ll bring more information to you about these two new programs in the coming weeks.  If you’re a homeowner and struggling to make your payments, you might be interested in either of these programs.  Simple give us a call at 239-489-4042 or email me at Brett@topagent.com feel free to visit our website www.Topagent.com for other timely information and links to our videos.

 

SW Florida Real Estate Market Reverses Fortune

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We like to include charts to illustrate latest trends in the SW Florida real estate market.  For years we’ve tracked numbers and reported the upside and the downward trends in the market.  For the past year or more all market trends have been to the upside.  Preliminary numbers gathered by the Ellis Team indicate single family home listing inventory in Lee County went up for the first time since January 2011.  Granted, back in January single family home inventory was 34.54% higher than it is today, but this past month is the first time we’ve seen inventory rise in months.

SW Florida Single Family Home Sales
SW Florida Single Family Home Sales

Listing inventory only rose 43 units which accounts for about .5%, so it’s not an alarming trend, just a slight change in direction we’ll keep our eye on.  Due to space constraints we didn’t include that chart; however we’d like to draw your attention to the SW Florida Sales Chart and the Pending Sales Chart.  Both these charts support findings in the inventory levels.

Sales in SW Florida have been falling since March which isn’t out of the ordinary the past several years.  What’s interesting is that September 2011 sales are slightly behind 2010 levels, but not by much.  Again, it’s the direction of the change, not the actual numbers we’re looking at.

Pending home sales Fort Myers Cape Coral Lee County Floirda
SW Florida Pending Home Sales

Pending sales have also fallen since March.  This confirms that pending sales are an accurate indicator of future closings.  While it makes perfect sense, sometimes in life what appears to make sense doesn’t always match reality, but in this case it does match. For months inventory levels have gone down and many have speculated that’s the cause of decreased sales.  We think there is a lot of truth in that.

Listing inventory just went up this past month, so does that mean sales will go up?  When official numbers are released next week we don’t think so.  We think they’ll mirror what we’ve been reporting and will be down slightly from the previous month.  So if inventory has been a legitimate reason sales have fallen, why wouldn’t the increase signify increasing sales going forward?

The answer is it could, but there are other factors.  We must look at the mix of inventory as well as other factors.  The mix refers to traditional sales versus foreclosed homes and short sales.  Not all short sales close, and their timing is anything but predictable.  Foreclosure inventory looks to rise some in the 4th qtr of this year and more in the 1st qtr of next year.  If this bears out, sales will almost assuredly be influenced by the exact number hitting the market as there is a large appetite for foreclosed bargains.

Other wild cards influencing the market are the availability of credit. Banks are requiring buyers to jump through more hoops and regulations than ever. The new Dodd Frank Act is making it more difficult to close even approved loans.  Regulations have become burdensome and making it impossible to meet certain deadlines.  We always say time is of the essence in our contracts, but that’s not the case as Congress has changed so many regulations for the worse.

There are waiting periods for HUD closings statements to be approved, so if there is any little change, all prorations of fees may need to be re-approved. If a buyer selects a different rate or program, the bank must re-disclose everything and a new waiting period begins.  This makes it difficult to meet certain deadlines in short sales, and many times that property is foreclosed instead of a successful sale because Congress saw fit to add additional layers and slow everything down.

Congress always has good intentions, but they don’t use their head.  Loans take hours to underwrite now and certain loans banks don’t even want to mess with because of the new regulations.  This hurts certain segments of the market.  I hear almost everyday complaints from loan officers on how tough their industry is.  Of course, lending affects our industry, and real estate affects the economy.  Sometimes I wish Washington DC would listen to people in business and get out of the way.  We’d all be better off if they regulated less and let business do business.  That’s the way to create tax revenues.

While we can’t control Washington, we can keep our eye on Main Street.  Main Street is ok in SW Florida, and we’ll continue to monitor.  One month doesn’t make a trend.  We’re simply reporting a slight change in direction, and we’ll watch the trends going forward to see what sticks.  If we can help you with your real estate needs, don’t hesitate to call 239-489-4042 or visit our website www.Topagent.com

 

Housing Affordability in SW Florida Hits All-Time High

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People are surprised to learn fixed interest rates are at or below 4% for 30 yr mortgages.  Because of this there has been a refinance boom which should throw some disposable income back into the economy.  It did the last time we had a refinance boom.  Not everyone can take advantage of this bonanza though as some are upside down on their mortgage.  Owners might be happy to know there is a government program that allows homeowners to refinance even if their first mortgage is up to 120% of current value, and if you have a second mortgage or equity line it can be subordinated to the 1st.  All good news if your rate is 6% or higher.  It’s possible good news even if your rate is in the 5%+ range depending on the home value.  Check with your lender for details.

Housing Affordability in SW Florida
Fort Myers Cape Coral Year End Sales Prices

Getting back to the main subject of this article, buyers today can now afford more home than ever before.  The reason is simple.  A home’s cost has several elements, and the two primary elements are sales price and financing costs.  As you can see from the year end sales prices our median home values have dropped dramatically and at the end of 2010 year end average prices were approximately even with 1997 prices.

Everyone rushed to buy in 2005 when in fact they should be rushing today.  Prices have moved upward a bit and when year end prices are posted for 2011 they will show an upward trend.  Bottom line is they’re still a far cry from the peak in 2005.

Income Needed To Qualify for $200,000 Loan

Look at the average 30 yr interest rate chart.  Back in October 2006 rates were approximately 6.36%. Today rates are around 4%. That’s a difference of about 2.36%. A $200,000 mortgage this year would be roughly $300 cheaper than it was 5 years ago.  This fact alone makes housing much more affordable.  Combining the lowest rates we’ve seen on record with deep price reductions in our market, it’s no wonder why this is the best time in years to purchase a property. Much thanks to Keith Cloak from Summit Home Mortgage for pointing out these historical rates to me.

The nation’s economy has been stalled for years.  Locally our market was hit first, and hard.  Because of that our market may be poised to recover sooner.  Tourism may get a shot in the arm if the proposed $1 Billion casino is approved at the Forum.  This would put Florida on the map for additional tourism and the all important convention and trade show business.  We would have our gorgeous Sanibel and Fort Myers beaches, year round sunshine, and now convention business attracting tourism to our area.

I spoke to Lee County sheriff Mike Scott the other day about his thoughts on the casino.  Those against bringing gambling to Florida argue it brings crime and detracts from the family atmosphere Florida is known for. Sheriff Scott doesn’t believe a casino would bring crime from a law enforcement standpoint.  Judging from my visits to Las Vegas or a seminar I attended in AZ at a casino on an Indian reservation, I don’t necessarily buy into increased crime either.

I do see this as an opportunity to add $1 Billion in construction at a time when our area desperately needs it.  I also realize we have gambling in Florida at Indian reservations, so I wonder why the state can’t capture some of that revenue too.  Lord knows our state needs the revenue as well.  Primarily I think about what increased tourism, conventions, trade shows, and visitors who might extend their stay a few days because Florida has so much more to offer than Las Vegas.  Vegas has gambling, but we have beaches, Disney, water sports, nature, and so much more.  I can envision vacationers choosing to come here instead of Vegas or Gulf Port MS, or even places like Branson MO.

With housing affordability in SW Florida at all time highs, home prices on the rise which will settle people who may be afraid if now is the time to buy, and a possible economic jolt to our economy, it sure is exciting to live in SW Florida.

Check out what Fort Myers Beach and Sanibel Island have to offer you.

Realtors Connecting With Customers on Social Media on the Rise

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Social media has been the buzz words the past few years and it seems everyone has tried to capitalize and make money from the latest craze. For those that understand its value and proper use, social media can be very rewarding. For those that make freshmen mistakes, the cost can be lost customers and countless hours of wasted time.

Realtors Connecting With Customers on Social Media

Realtors Connecting With Customers on Social Media
Ellis Team Twitter Page

The benefits are clear. If done properly, consumers may flock to your content, or you may find yourself interacting at deeper levels with your customers and finding out more about them than you ever would have face to face. Social media opens up a new world where people sometimes feel safer sharing inner feelings and facts about themselves than they do in real life.

Connecting with customers is all about getting to the heart level and learning what’s important to them. You’ve probably heard the old saying, “Treat others as you’d like to be treated.” At the Ellis Team we like to use the Platinum standard which is “Treat others as they’d like to be treated.” We study personality profiles and adapt our communication based upon the way our customers like to communicate. Not every personality profile is the same.

Official SW Florida Real Estate Facebook Fan Page
SW Florida Real Estate Fan Page

Some personalities are bubbly outgoing social beings that have never met a stranger and are certainly the life of every party. Another is the calculated detailed oriented person who must know all the facts before making a decision. There is also the family oriented person that could talk children and family all night, as well as the dominant director type that makes quick decisions and is in charge. Knowing who our customers are helps us to interact with them on their level. The director type turns off with hours of facts and needless chatter, while the engineer, detailed oriented person would never make a decision without studying it from many angles.

Social media helps us to understand our customers and deliver information on many levels. We also engage our customers. We teach our team that if you can get a person to talk about (FORD) Family, Occupation, Recreation, Dreams you will connect at a deeper level and become friends with everyone you meet. Many of our customers are friends because we care about them as a person, not just a transaction.

Apply FORD to Facebook. In just a few minutes you may find out about someone’s niece or nephew, their child’s soccer game. You might also find out their new relationship status, how happy they are in their job, what they did on vacation, how their sports team is doing, etc. You can hit all 4 FORD items quickly. Social media is an opportunity to engage.

There is no substitute for being face to face with someone and interacting, and many people condemn social media because of that. However, perhaps there is no more efficient way to connect as social media. In real life true communication may mean asking many questions. We call it going 4 or more deep with questions to find out what someone really means. Because people aren’t as inhibited online as real life, true feelings come out much quicker, so in some respects I think social media has improved true communication. Not everyone has the time or skill to go at least 4 deep. However, the downside with social media is you might just learn a whole lot more about someone than you cared to know. LOL

So the next time you jump online and into a social media platform, think about more than just posting random thoughts. Use it as a tool to elicit responses, get people talking, and learning more about others. When you learn and care about others, you become more attractive as a friend or resource, and people will enjoy telling you everything, and maybe even doing a little business with you. And if not, at least you’ll make some true friends.

Good luck and happy communicating. We’ve included a few of our public social media pages in case you’d like to get some ideas. And maybe we’ll become friends too.

 

Useful Social Media Links:

Official SW Florida Real Estate September Sales Numbers Show Mixed Signs

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Official sales numbers were released this past week by Florida Realtors and as expected median sales prices fell 3.46% from July as more distressed sales sold in August 2011 than July. Sale prices were up 16.74% from August 2010 which is positive. Listing inventory continues to slide which bolsters prices as well. Last year Lee County had 11,667 combined single family homes from all MLS’s on the market and today we’re down to 7,675 combined. Actually there are less than both numbers because some homes are listed in multiple MLS’s, especially high end homes or homes in Estero, Bonita, San Carlos park where Realtors may belong to more than one MLS and desire additional exposure. Sanibel and Captiva is another example of where agents might list homes in the Sanibel board and the Fort Myers board.

SW Florida Real Estate Homes Closed 2009-2011
SW Florida Single Family Homes Closed

As you can see from the attached charts, even though inventory has been falling, Realtors have been successful at closing high numbers of homes even though many are short sales. This is a testament to the fact buyers are being forced to look at short sales which may take longer to close to find homes in their price range. It is also testament that Realtors are increasing their education to handle these complicated sales, and banks are gearing up to close more of these sales rather than selling through foreclosure.

SW Florida Single Family Sale Prices 2009-August 2011
Single Family Home Sale Prices in SW Florida 2009-2011

While sales prices have declined from their 2011 seasonal highs, they are still significantly higher than last year’s numbers signifying the bottom may be behind us. Before our market reaches for the skies again, we must first repair our fragile economy and create jobs and income growth. Combining that with a coherent, understandable, and definite tax policy will also help settle the real estate market. Congress and presidential politicians keep proposing changes to mortgage deductions, increased capital gains taxes on certain groups of people, and worst of all they’ve failed to extend the National Flood Insurance Program which puts hundreds of thousands of current transactions in jeopardy.

Washington couldn’t script are more harmful strategy to disrupt housing, which is amazing as housing leads to 32% of the nations GDP. There has got to be a better way, and thankfully there is a better way, but it won’t happen until the next election.

So for the next year the nation’s economy and housing market will have its ups and downs and will take its lumps until certainty returns to the market. I never understood why the president proposes raising taxes on certain people and not others. While I’m certainly not rich, nor is any real estate agent I know in SW Florida, I just don’t understand how taxing those that make more money encourages them to work harder or hire more people, which is what our economy really needs right now.

Last week I wasn’t paying attention and I received a speeding ticket. A day later I thought. Hey, if certain people get to pay more taxes because they earn more, then why can’t certain people drive faster than others? If I’m paying more shouldn’t I be allowed to drive faster? Well, it’s a silly argument as we should all obey and drive by the same rules, and so it goes with taxes, we should all pay the same rates. If someone makes more, they automatically pay more. So why should they pay more, and pay a higher rate?

And when companies are taxed at one of the highest rates in the world, why do we wonder when they move operations overseas? Perhaps we should lower taxes and encourage them to come back and hire US workers, which would raise income to the government.

Have you ever wondered why certain corporations move to Delaware or South Dakota? It’s because those states learned to compete with other states they must have lower taxes. It’s about time our Federal government understood this. We are in a global competition. When someone can accurately predict when our government will get its act together, almost anyone will be able to predict the real estate market. Until then, we’ll keep reading the tea leaves and reporting what we see.

 

SW Florida Real Estate September 2011 Official Numbers Released

Florida Real Estate Bargains a Victim of Perception

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

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

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

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

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

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

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

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

Florida Real Estate Bargains

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

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

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

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

Spotlight on Town and River

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

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

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

 

 

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

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

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

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

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

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

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

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

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

Watch our September 2011 SW Florida Real Estate Market Report Video

SW Florida September 2011 State of the Real Estate Market Report