Tag Archives: ObamaCare

Listing Inventory on the Rise

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We’ve been waiting on inventory levels to rise so that sales can pick up and as is traditional for this time of year, the market has responded. Single family home inventory rose over 400 units from September. Last year inventory rose almost 300 units in October.

Listing Inventory on the Rise Fort Myers Cape Coral

Listing Inventory on the Rise

Inventory levels peaked this January and then began to fall as we outsold inventory as it came to the market. Hopefully our inventory will continue to increase heading into season so we have enough to sell this season.

Median prices are up about 12% over last year. In recent years most of our big price gains have occurred February though May, so we’ll be watching to see this year how season affects prices. We expect to see higher prices this season which sets the bar for the rest of the year. In season we tend to have more cash sales which are less affected neither by appraisal issues nor from changes in interest rates.

Fort Myers real estate sold

The economy seems to be improving which could lead to more market strength; however there are some wildcards on the horizon that could temper market gains.

No one knows what affect ObamaCare will have on disposable income. If people end up saving money on the exchanges they’ll have more to spend on other things, which could help the economy and housing. However, if as is being reported insurance costs rise for a great number of people, this could have an adverse affect on the economy and housing. If more of people’s income goes to health insurance then they have less to spend on house payments or other things. If it adversely affects the economy, this slows down people’s disposable income as well.

If employers either drop coverage altogether after 2014, or cut back on full time employees, this could definitively adversely impact the real estate market. It would also affect the stock market, business, and the economy as well.

Interest rates are set to rise at some point as the government phases out buying treasuries to keep interest rates low in a down economy. The Fed’s have signaled the will end this buyback soon, and the question is simply a matter of when and how they will taper.

If the economy takes off perhaps it can weather these two wildcards. People think the real estate market is either set by Realtors or happens in a vacuum, but the reality is it is influenced by many market forces and Realtors have little to do with prices. Realtors simply help buyers and sellers interpret the market based upon facts and data, and ultimately buyers and sellers make decisions about what they buy and sell.

It’s kind of like walking into a store. If a product presents as a good value, buyers will purchase. If a product is inferior or over-priced, buyers will walk. Buyers today shop many stores and look things up on the Internet. A Realtor or seller can’t just set a price and expect the market to respond. It has to be based off of data and logic.

If you’d like to search the market as either a buyer or seller, visit www.Topagent.com If you need extra help we’re always available to talk to you and help you make better decisions. Our phone number is 239-489-4042 Good luck and Happy House Hunting!

To search the MLS for properties go to www.TopAgent.com or give us a call at 239-489-4042     Good luck and Happy House Hunting!!!

Feel free to view our Virtual Tours .

Visit our Google+ Business Page

 

SW Florida Real Estate Market Continues Recovery

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SW Florida real estate market continues recovery. Many would say our market is Hot, and compared to 2006-2009 it’d be pretty hard to disagree with that statement. While we are seeing some nice gains, our market is healing, which is a good thing.

SW Florida Real Estate Market Continues Recovery

A couple of things we look for are the percentage of cash vs. financing to identify the liquidity in the market as well as the percentage of traditional sales vs distressed sales. Our market has good volume now and would be higher if we had more inventory to sell.

We’ll come back to inventory in a moment. As you can see from the attached graph, traditional sales are above 70% of the total sales. Back in 2009 they were close to 20%, so that’s a big swing.

Cash sales are dropping as a percentage of total sales. Many would say that’s a bad sign, but it’s actually a good sign. Banks add money to the market. For awhile banks weren’t lending much. There is a cap on cash sales and the amount cash buyers will pay, but not so much on financing. Buyers will use leverage to purchase more, so it helps add liquidity to the market. Cash is always good, and having cash buyers is a good thing, but relying on them is a sure fire way to a stagnant market. Infusing capital into the market helps pull the market higher, and we’re seeing definite trends in financing. Banks have finally made it possible to borrow again, and that will help us continue this recovery.

I recently had a potential seller ask me why I didn’t say the market has fully recovered and that we were in full blown market mania. When I showed the seller how much his home value had increased from 2009 he was impressed, but he had refinanced his house during the boom and owed more today than it’s worth. Had he not taken money out at the height of the market he would have had equity, but since he did, he was still underwater. He chose not to sell today but we’d revisit the issue next year.

This is exactly why I say we’re still recovering. Back in 2005 we had artificial influences affecting the market, and we still do today. Today the artificial influences are the fact that some sellers still owe more than their property is worth today. If we didn’t have upside down sellers we’d have more inventory, and if we had more inventory we’d have more sales.

Short sales, foreclosures, and traditional sales in Fort Myers Cape Coral Florida real estate market

Some sellers are above water but just don’t like their equity position because it doesn’t leave them much down payment for the next home. In any event, equity positions are holding back many sellers who’d otherwise like to sell but are still trapped in their homes. This is perhaps one of the last barriers to calling this a full blown market recovery.

When the economy finally takes off, we could move closer to that point. Signs point to a recovering economy, but things like ObamaCare could stall that if companies cut back to stay afloat. We’re also hearing from small business owners who are facing large premium increases, so this cuts into their disposable income and their real estate purchasing power. Something tells me that when fully implemented, the public will turn to their congressmen and demand some changes, and they’ll make some changes to lessen the effects.

In the meantime, let’s keep this economy rolling, and keep the banks lending. We’re doing our jobs in the trenches and we’ve got this market heading in the right direction. If the banks and Washington all play nice, 2014 is going to be a great year. To search the MLS go to www.TopAgent.com You can always call us at 238-489-4042

If you’d like to search the MLS, visit our website at www.Topagent.com  If you’re considering selling and would like the Ellis Team to show you what we think we can get for your home, go to www.SWFLHomevalues.com or call us at 239-489-4042  Good luck and Happy Selling!

To search the MLS for properties go to www.TopAgent.com or give us a call at 239-489-4042     Good luck and Happy House Hunting!!!

Feel free to view our Virtual Tours .

Visit our Google+ Business Page