Tag Archives: SW Florida Home Sellers

Market Data Shows Price Decreases Amid Growing Inventory

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It’s that time of year again folks.  SW Florida home sellers begin reducing prices as season drags on.  This isn’t necessarily a bad thing.  In season, homes fly off the shelves, but not all homes.  Each year some sellers get greedy and hope that an out of town buyer will overpay for their home because they just love it so much.  What’s different this year is that inventory levels are higher and the monthly supply of inventory has grown. Market data shows price decreases amid growing inventory.

Market Data Shows Price Decreases Amid Growing Inventory
SW Florida Market Watch

Motivated sellers are finding out that they cannot overprice a home and expect it to sell.  It’s been a seller’s market in years past.  This year it’s more of a balanced market.  We have perhaps one of the healthiest markets we’ve had in a decade.  By that we mean neither seller nor buy has an advantage.

When the market shifts like this it’s an opportunity for educated sellers to use their knowledge and jump ahead of other sellers before they figure out what’s going on.  It’s not that hard to do.  Many sellers are reluctant to hear the truth, so they tell themselves the market is better than it is.  They study neighbors asking prices and add some more simply because their home is nicer.  Never mind the fact their neighbor’s home has been on the market for over a year.  They judge their competition by asking prices instead of sold prices.

Market Data Shows Price Decreases Amid Growing Inventory Listings
Listing Inventory

The educated seller looks at other sellers who have won the home selling game.  It’s kind of like asking a group of fishermen how the fish are biting today.  You wouldn’t ask the ones going out in the morning who haven’t caught anything yet.  If you truly want to know how they’re biting, you’d ask the ones coming in at end of day with fish in their boat.

Market Data Shows Price Decreases Amid Growing Inventory Months Supply
Month’s Supply Inventory

The same is true with the real estate market.  We must look at actual sold data and compare to the subject property.  And we should look at what the conditions were at the time of those sales versus today.  If a home sold 5 months go back when we had less inventory to compete with we may have to discount that a bit now that we’re competing with many more homes.  We must take all conditions into account.  Otherwise we may misjudge the market, and that only hurts the seller in the long run.  Sure, they’ll feel better about themselves for a month or so until they realize the price they thought their home was worth was just pie in the sky.

Sellers may blame the market. They may even blame their Realtor for not selling it.  We’ve been through shifting markets before.  Many times, we’d call a seller and talk to them about market conditions.  Some just do not want to hear they need to reduce their price.  No Realtor enjoys that conversation anyway, but ignoring changing conditions can be at your own peril.

We have a good market right now.  Chances are if your home hasn’t sold yet it’s due for a pricing checkup.  Marketing becomes more important as inventory grows.  Pricing is equally important.  It could just be that you were a little too aggressive initially and re-positioning your home in the marketplace could do the trick.  As you can see, a lot of sellers are selling, and the one’s that aren’t are reducing their price.

If you need to get your home sold, call the Ellis Team at Keller Williams for expert pricing and marketing 239-489-4042.  If you’d like to shop and educate yourself online first, go to www.LeeCountyOnline.com  It has all the listings and it’s updated every 5 minutes.  No more looking at homes that sold months ago, or old prices.

If you’re looking to buy or sell, our team can help!  We make the process easy and we handle all the details.  Let us help you with your next SW Florida transaction.

Good luck and Happy House Hunting!

SW Florida Real Estate Shift is On

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Real estate shifts are the natural ebb and flow of the market.  The real estate market never stays constant.  It is affected by supply and demand, employment, the economy, interest rates, weather, political forces, and more.  Our world is in a constant state of shift, so why would the real estate market be any different? We’ll show you why the SW Florida real estate shift is real and it is in effect.

Nobody would expect the stock market to stay the same each day.  People know that it goes up and down, and many times it does so in the same day.

Currently the SW Florida real estate shift is on.  Last week we reported that sales prices have been flat all year.  Some prices ranges have gone up and some have gone down, and overall the market is flat.  If you didn’t read last week’s article on about SW Florida home sellers  we’d encourage you to go back and read it as the graphs show perfectly what is going on with prices.

SW Florida Real Estate Shift is On

SW Florida Real Estate Shift

Today we’d like to focus on closed sales.  As you can see from the chart, closed sales are down in Lee County versus last year.  In fact, they’re down 9.04% year over year.

We have rising inventory, declining sales, and stagnant home prices.  I’d call that a shift.  It’s nothing to worry about or blatant in the numbers, but something to be aware of going forward.

In a shifting market, marketing is more important than ever.  To get top dollar your home must compete and stand out.  It must do so in three ways.

Everyone knows if they wish to sell something it pays to have interest from more than just one party.  Imagine selling an item online.  Would you rather have 1,000 bidders or just 1 bidder for your item?  Of course, everyone would choose multiple bidders when selling.  The same is true in real estate.  You don’t necessarily need multiple bidders; however, you better expose the home to multiple parties.  Everyone would agree that 100% exposure equals top dollar.  Anything less may net you less than top dollar.

Secondly, while marketing is most important, no amount of marketing will sell an overpriced home.  We could spend a million dollars marketing a property.  If it is worth $500,000 and we price it at $1 million will it sell?  Of course not.

Thirdly, the agent you choose may be the most important factor of all.  You want an agent that will give your home the most exposure.  You want an agent with experience to know what price it should start at, and the wisdom and courage to tell you when it’s time to adjust.  Inexperienced agents may not know how to price, and they may not have the courage or confidence to tell you an adjustment is needed.

When I go to the doctor because I fear something is wrong I don’t want a doctor who will tell me what I want to hear.  Of course, I hope its good news and nothing to worry about.  However, if it isn’t I want a doctor to tell me straight-up so I can make quick decisions and rectify the bad situation.  The sooner you deal with a medical issue the less pain you may feel on the back end.  In life, the sooner you deal with issues the quicker they are resolved and the sooner you get back to living life.

The same is true in real estate.  When making a real estate move, don’t call that friend who just got their license or that family member who needs help.  You want the best, and your financial success depends on it.  Especially in a shifting market.

When financial markets shift, you’ll hear the term “Flight to quality.”  This means a movement towards safety and dependability.  In real estate, sellers move towards experienced agents who can guide them through the shifting maze.  Now is when experience counts, and your future depends on the advice, expertise, and marketing from agents who can guide you.

If you go on a swamp buggy tour, you’ll know what I mean.  You want a tour guide who’s done this a time or two and won’t tip the buggy over in alligator infested swamp water.  We’ve done this a time or two, so feel free to call us if you’d like to buy or sell in SW Florida.  Visit our website at www.LeeCountyOnline.com to see all properties in the MLS or find out what your home is worth.

Watch our SW Florida Real Estate Shift Predictions Back in February 2016

SW Florida Home Sellers Confused

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Thank goodness we’ve been busy listing and selling a lot of property lately.  The 360-degree home tours and advanced marketing we’re employing to go out and create buyers for our listings is working.  We have noticed a trend recently we thought we’d try to clear up.  SW Florida home sellers are confused when they read headlines that home prices were up 11.3% in August.  They’re interviewing agents and they aren’t hearing the higher prices they were expecting, so they’ve called us out to verify what’s really going on in the market.

SW Florida Home Sellers Confused

We decided to present the chart in a different way.  Agents have been telling sellers there’s been a shift since we reported on it back on February 16th.  Sellers aren’t seeing it though because they read the headlines.  It is true, median prices are up 11.3% over last year.  However, they are down $5,000 from last month and down $2,000 from where they were last November.

Unless home prices rise in the next few months, we’ll be looking at essentially a flat line since last November.  In other words, home prices aren’t statistically rising right now.  The rise occurred last year up until November, so when you read that home prices are up over last year, they are until we get to November.  They are actually down month over month as much as they are up which is creating the flat line.

It is possible prices could start rising again.  Perhaps after the election consumer confidence will grow.  I think everyone can agree they’re tired of the political season and just want it over with as soon as possible so we can move on with our lives.

We see the Fed raising rates at their December meeting.  Interest rates have been quietly rising the past few weeks and we see more of that in 2017.  Rising rates typically do not help home prices rise because it steals affordability from the buyer.  Basically, when rates move up 1% it robs the buyer of about 11% purchasing power.

In other words, a $400,000 buyer putting 10% down could finance $360,000.  If they lose 11% purchasing power, for the same payment they can now finance 320,400.  They lose $39,600 in purchasing power.  Their payment remains the same as if they were financing $360,000 and paying $400,000 earlier before rates went up.

This is why rising rates does not help home prices.  Rising rates can spur home buyers who have been on the fence to buy now so they will save money on payments, but it doesn’t help prices long-term.

This is one reason choosing the right Realtor to list your home will become even more important.   You need a Realtor who has sold during a rising rate environment.  I venture to guess that over 80% of agents today have not been in business long enough to experience that.

How you sell in a rising rate environment is vastly different than in a stable or lowering interest rate environment.  Marketing becomes more critical as well.

If you’re a buyer, I would seriously consider buying now.  It will cost you to wait.  Prices may still rise, just not as fast.  Or they may remain stable.  The only advantage to you might be more inventory to choose from.  The disadvantage will be that it will cost you more to buy the same house next year, simply because of rising rates.

If you’d like to search the market, check out www.LeeCountyOnline.com  You can beat out other buyers to hot new listings as our database is updated every 5 minutes directly from the MLS.

SW Florida home sellers, if you’re  considering making a move, you should call us now.  239-489-4042.  Or visit LeeCountyOnline.com and get a free computerized estimate of your home’s value.

Please call us if we can help.  Good luck and Happy Home Buying!

Our Paint the Town Red event was a success.  We had over 35 properties open in one day and produced several interested buyers for our properties.  Be on the lookout for our next open house extravaganza.

Don’t forget to enter our contest so you can win a Yeti Cooler.