A friend of mine recently closed on a home. He had waited 3 years to purchase. He watched the markets carefully. He finally decided on a great home in a highly desirable subdivision. He got the home for 50% of what it sold for 3 years ago, and a full 10% under the current market value.
His comment to me? "I just wish I could prevent the powers that be from using this sale as part of the 'market is recovering' hype"!
Now, I understand a healthy dose of caution when purchasing in this, or any market. But to be so cynical just after making such a great buy? His take on it is that although he purchased, he didnt want someone else to use him as an example of a recovering market.
Folks, the market starts recovering when people start buying. Even at depressed prices, decreasing inventory means less available to purchase. Homes selling more quickly means that we begin to see "list to sale" ratios declining and approaching equilibrium.
Lately, there is a lot of resistance from sellers to go any lower. Just ask a few of my buyers who have been frustrated on several properties. On others, there are multiple offers. These are all signs of a market that is ready to recover, if it is not well on its way.
It's not "hype" if all the numbers are favorable. If people are buying. If inventory is decreasing, sellers are holding, and buyers are competing. Its reality.
Could something happen tomorrow to change those facts? Of course. But for now, things are heading in the right direction.
Tuesday, October 20, 2009
Saturday, October 17, 2009
Sarasota Short Sale Pricing is Changing
This week we received word that the short sale process is being revamped and standardized at the highest levels. The most welcome news is that if the new provision passes, the banks will actually be setting the short sale price, not the listing agent.
I have heard a collective cheer go up amongst my customers. The short sale process is daunting, and most frustrating for many people is seeing a price on a listing that may not be acceptable to the bank, even if they make a full price offer.
I have noticed lately that when the daily "status change report" makes it to my inbox, that many properties have raised their price by a considerable amount. Further investigation shows that they were a short sale that has gone pending at the higher price. For instance, this morning, a home which had been listed at $109K went pending at $136K. What happened? This may be price the bank would actually take as opposed to a fantasy price set by a well meaning listing agent.
So when the short sale pricing is set by the bank, the issue of "list price reality" will be solved. What folks are not going to like, however, is that the false veil of "rock bottom prices" will be lifted. Many people express shock when a home goes into foreclosure, and the bank actually raises the price of the home from its short sale levels. It's not a surprise to me - the bank is simply finally revealing what they will accept. The reality of that number has been the same all along - we are simply finally privy to it.
Take heart, folks. Many of those prices werent real anyway. I for one would rather deal with accurate reality than fantasy.
Postscript
There is a whole other discussion to buying a short sale - if the short sale price is unbelievably low, the chances of the winning bidder paying that price is slim. They probably made an offer OVER list price. If the home is set 50% below market, making an offer 5-10% over list still makes perfect sense in order to score a great deal over the competiton who are likely offering at or less than list. In case this all sounds familiar, it should. It's called a "bidding war", and it happens in any market for well priced properties.
I have heard a collective cheer go up amongst my customers. The short sale process is daunting, and most frustrating for many people is seeing a price on a listing that may not be acceptable to the bank, even if they make a full price offer.
I have noticed lately that when the daily "status change report" makes it to my inbox, that many properties have raised their price by a considerable amount. Further investigation shows that they were a short sale that has gone pending at the higher price. For instance, this morning, a home which had been listed at $109K went pending at $136K. What happened? This may be price the bank would actually take as opposed to a fantasy price set by a well meaning listing agent.
So when the short sale pricing is set by the bank, the issue of "list price reality" will be solved. What folks are not going to like, however, is that the false veil of "rock bottom prices" will be lifted. Many people express shock when a home goes into foreclosure, and the bank actually raises the price of the home from its short sale levels. It's not a surprise to me - the bank is simply finally revealing what they will accept. The reality of that number has been the same all along - we are simply finally privy to it.
Take heart, folks. Many of those prices werent real anyway. I for one would rather deal with accurate reality than fantasy.
Postscript
There is a whole other discussion to buying a short sale - if the short sale price is unbelievably low, the chances of the winning bidder paying that price is slim. They probably made an offer OVER list price. If the home is set 50% below market, making an offer 5-10% over list still makes perfect sense in order to score a great deal over the competiton who are likely offering at or less than list. In case this all sounds familiar, it should. It's called a "bidding war", and it happens in any market for well priced properties.
Wednesday, October 14, 2009
Sarasota Real Estate Numbers
Trends continue to signal recovery in the Sarasota market according to the Sarasota Association of Realtors September report:
* Home and condo sales skyrocketed - a 35% increase in sales over September of 2008
* Sales up 10% over August in our traditionally slowest month
* Pending sales have exceeded 800 for 7 of the 9 months in 2009, after lingering between 400-500 much of the last two years
* Time on market numbers are down to 9.8 months from over a year for a single family home - 6 months is considered a market in equilibrium
* Inventory numbers - 3,915 single family homes and 2,337 condos - are the lowest they have been since August 2005.
Median sales prices are lower , fueled by short sales and foreclosures. As these inventories dry up, prices will again begin to climb and we will begin to see more multiple offer situtatons - bidding wars - on the best properties.
* Home and condo sales skyrocketed - a 35% increase in sales over September of 2008
* Sales up 10% over August in our traditionally slowest month
* Pending sales have exceeded 800 for 7 of the 9 months in 2009, after lingering between 400-500 much of the last two years
* Time on market numbers are down to 9.8 months from over a year for a single family home - 6 months is considered a market in equilibrium
* Inventory numbers - 3,915 single family homes and 2,337 condos - are the lowest they have been since August 2005.
Median sales prices are lower , fueled by short sales and foreclosures. As these inventories dry up, prices will again begin to climb and we will begin to see more multiple offer situtatons - bidding wars - on the best properties.
Sunday, October 11, 2009
Right Under Your Nose
The market has been abyssmal for so long in Florida, that there is a sense that it will never change. Buyers are content in the knowledge that they are firmly in the catbird seat, and that they should still wait out the "bottom" of the market.
The problem is, that as exclusive buyer agents in Sarasota, we are seeing the exact opposite. Three times this week, my buyers found themselves in multiple offer situations. Often, these situations are resulting in the successful bidder offering list price or higher to get the property.What is happening? The best deals are being scooped up quickly, and there is no more luxury of "wait and see". The fact is this - the list price is the most irrelevant number in the whole process - the VALUE is what is important.
Its a strange time in the Sarasota real estate market. The prices have fallen remarkably low. However, no matter how low they fall, buyers still seem convinced prices are too high. With all evidence to the contrary, they want to lowball the offer thinking that the seller will be thrilled to get an offer. However,the sellers have come to the opposite conclusion. With inventory shrinking, and sales AND values rising - they think they have gone low enough. With season approaching and news media reporting that everyone should consider a Sarasota real estate purchase - they are feeling more empowered than they have in years.
So what happens when buyers don't want to admit that times are changing, and sellers insist they are? Buyers are often missing out on incredible deals as savvy investors are buying the best deals right out from under them. The market is undeniably changing. Buyers will need to adjust their thinking or face the fact that they missed the opportunity.
The GREAT NEWS for buyers? The prices are likely still near the bottom, the properties are still available, and the deals are still there. For now.
The problem is, that as exclusive buyer agents in Sarasota, we are seeing the exact opposite. Three times this week, my buyers found themselves in multiple offer situations. Often, these situations are resulting in the successful bidder offering list price or higher to get the property.What is happening? The best deals are being scooped up quickly, and there is no more luxury of "wait and see". The fact is this - the list price is the most irrelevant number in the whole process - the VALUE is what is important.
Its a strange time in the Sarasota real estate market. The prices have fallen remarkably low. However, no matter how low they fall, buyers still seem convinced prices are too high. With all evidence to the contrary, they want to lowball the offer thinking that the seller will be thrilled to get an offer. However,the sellers have come to the opposite conclusion. With inventory shrinking, and sales AND values rising - they think they have gone low enough. With season approaching and news media reporting that everyone should consider a Sarasota real estate purchase - they are feeling more empowered than they have in years.
So what happens when buyers don't want to admit that times are changing, and sellers insist they are? Buyers are often missing out on incredible deals as savvy investors are buying the best deals right out from under them. The market is undeniably changing. Buyers will need to adjust their thinking or face the fact that they missed the opportunity.
The GREAT NEWS for buyers? The prices are likely still near the bottom, the properties are still available, and the deals are still there. For now.
Monday, October 05, 2009
Why didn't you show me this one?
As exclusive buyer agents, we look at a lot of property. We research neighborhoods, scour county records, and run out to preview homes that look like great deals as soon as they are listed. We pride ourselves in knowing the current inventory in Sarasota.
Often people will call us and give us their criteria, asking for our assistance in finding a great property. Criteria usually includes price range, monthly budget, lifestyle preference, and size of home. Most often, I begin to visualize great options before I even open up the search screen.
Because of the great tools on the internet, folks can search on their own. This is valuable to us, because we can begin to see those types of properties that catch your eye. The most common question I get, though, is "Why didn't you send me these homes? (see attached link) They look great!"
The answer lies in access. I simply have more access, and more information, than you do when looking at listings. It's a perk of the license. The most common reasons I didn't send you the "perfect home at the almost unbelievable price" include:
1) The home isn't in Sarasota. Yes, I know the listing says it is. But it isn't. Sometimes listing agents put a more desirable address on a property. You can't tell its 30 miles away and 15 miles from a beach. But I can.
2) It's a short sale. Some clients are well educated on the short sale process and are willing to take on the challenge, and the waiting game. Many others do not have the time luxury to wait around months for a bank. Unfortunately, the listing that you see doesn't always say that the crazy low price you see is actually not bank approved. If you are looking to buy within a time frame, a short sale is not for you. But you can't see the status.
3) I know why its so cheap. It backs up to a major road, or is located next door to a garbage dump. Or it may just have really small lot sizes. Whatever the reason, you have told me your criteria, and I know this won't cut it for you.
4) Country clubs cost money. In this market, many of the homes in the country clubs have dropped in price dramatically, making lovely homes seem too good to be true. But while the home is great, and the community is awesome, there is a required membership fee to the club - and what I have learned in in most cases, only the most avid golfer is willing to pay a membership fee that seems pricey given the price of the home. By the same token, some condos have low prices, and sky high condo fees. These are often not evident on your information.
5) Your kids, your dog, or your work truck are not welcome there - That sounds terrible, but 55+ communities often will not allow occupants under 18, many places have pet policies, or HOA rules. Based on what you told me, I know you aren't moving here without your dog - or your kids! :) So I didn't include the property. Another spin on this is when you are looking for investment/rental property, and the association does not allow rentals.
I understand that when you see a home that looks fantastic, you want to know the information on it! And I am happy to provide it. Just know that we are working diligently behind the scenes, looking at every listing, evaluating if it is good for one of our folks, and sending it along to you. We are also screening the homes that may look good on the surface, but we know to be contrary to your needs or budget.
Together, well find a great Sarasota home.
Often people will call us and give us their criteria, asking for our assistance in finding a great property. Criteria usually includes price range, monthly budget, lifestyle preference, and size of home. Most often, I begin to visualize great options before I even open up the search screen.
Because of the great tools on the internet, folks can search on their own. This is valuable to us, because we can begin to see those types of properties that catch your eye. The most common question I get, though, is "Why didn't you send me these homes? (see attached link) They look great!"
The answer lies in access. I simply have more access, and more information, than you do when looking at listings. It's a perk of the license. The most common reasons I didn't send you the "perfect home at the almost unbelievable price" include:
1) The home isn't in Sarasota. Yes, I know the listing says it is. But it isn't. Sometimes listing agents put a more desirable address on a property. You can't tell its 30 miles away and 15 miles from a beach. But I can.
2) It's a short sale. Some clients are well educated on the short sale process and are willing to take on the challenge, and the waiting game. Many others do not have the time luxury to wait around months for a bank. Unfortunately, the listing that you see doesn't always say that the crazy low price you see is actually not bank approved. If you are looking to buy within a time frame, a short sale is not for you. But you can't see the status.
3) I know why its so cheap. It backs up to a major road, or is located next door to a garbage dump. Or it may just have really small lot sizes. Whatever the reason, you have told me your criteria, and I know this won't cut it for you.
4) Country clubs cost money. In this market, many of the homes in the country clubs have dropped in price dramatically, making lovely homes seem too good to be true. But while the home is great, and the community is awesome, there is a required membership fee to the club - and what I have learned in in most cases, only the most avid golfer is willing to pay a membership fee that seems pricey given the price of the home. By the same token, some condos have low prices, and sky high condo fees. These are often not evident on your information.
5) Your kids, your dog, or your work truck are not welcome there - That sounds terrible, but 55+ communities often will not allow occupants under 18, many places have pet policies, or HOA rules. Based on what you told me, I know you aren't moving here without your dog - or your kids! :) So I didn't include the property. Another spin on this is when you are looking for investment/rental property, and the association does not allow rentals.
I understand that when you see a home that looks fantastic, you want to know the information on it! And I am happy to provide it. Just know that we are working diligently behind the scenes, looking at every listing, evaluating if it is good for one of our folks, and sending it along to you. We are also screening the homes that may look good on the surface, but we know to be contrary to your needs or budget.
Together, well find a great Sarasota home.
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