I know it sounds like I am telling the same old story for the last few month. But now we are getting proof that the Real Estate Market in south west Florida is in recovery. Sales were up in June and July, prices are increasing and you will hear now from a lot of Realtors and buyers that they are being "outbid" by another buyer on certain properties. 

Just last week I got a phone call from another Realtor who presented an offer on one of my listings. She told me that this property (my listing) is her 4th try with this buyer to buy a property - she lost the previous 3 because they got outbid by other buyers. This home was on the market for only 2 days and I had multiple offers on it. However her offer was the strongest, so finally this buyer is able to go ahead and make his moving plans. This property was priced at fair market value, not under and not over.

I had another listing which was only on the market for a few hours and it had several offers on it. Here the same situation. The Agent whose buyer ended up buying this property previously had made several attempts to get a home for her buyer.

Those are not single cases, it happens to me with my own buyers as well. 

Don't get me wrong - we still have enough inventory and the prices are still very good. With most properties still under market value. However those properties are going fast and buyers and agents really have to jump on those homes and the times of, oh well, I will think about it for a few weeks and then I probably will write an offer - those times are over.

The Market in our area is cooking just below the surface and in my opinion, it will not take a lot to make it explode again. 

I just heard in the news that the property value in South West Florida is up for 25% compared to the same month last year.

          

I do not have a crystal ball either. But I am a full time Realtor in South West Florida since almost 15 years. I have worked thru Buyer's markets (commonly named "bad" market) before and actually under way worse circumstances. At those times the interest rate was above 14% and it was very hard to obtain financing all together. I have also worked thru Seller's Markets (commonly named "booming" market) where properties did not even hit the market and were sold. Where buyers starting bitting against each other just to purchase one property. I don't think there is such a thing like a "bad" or "booming" Real Estate Market. I think that is a point of view. Buyers love a Buyer's Market since Buyers are sitting in the driver's seat and since buyers can purchase properties to very good prices which equals a very good investment. Sellers of course love a Seller's Market where properties are being purchased way above Market Value - they are getting a good return on their investment.

An educated Buyer will always buy in a buyer's market and an educated Seller will always sell in a seller's market - of course  only if either buyer or seller have a choice. Understandable there are situations where a seller is forced to sell in a buyer's market or where a buyer is forced to buy in a seller's market.

Since the end of 2007 I am taking about the recovering Market in South West Florida. A lot of people stated that they are nocht expecting the market to recover any time soon, most people expected the market to be down for another few years. I disagreed back then and I disagree now even more. I said at the end of 2007 that I believe that we will see a major improvement before the end of 2008.

Here is our current Situation (July 2008) Good priced properties are rarely hitting the market and are gone - picked up and purchased by Buyers or Investors. Even High End properties are hitting the market and are sold. Just today I heard a report on the news that the sales in our Area (Cape Coral/Fort Myers) increased by 47% and the prices are increasing by 10 - 25% already. I also read an article in CNN Money today stateing that the market is going to recover faster than anticipated and the we did hit the buttom a few weeks ago. All of us Realtors are very busy right now. Due to the still low property prices, the low interest rate and the European Market with the strong Euro towards the US Dollar - it is still a buyer's and investors heaven.

I still remember the time before the past boom in 2004 and 2005. We all expected the market to take off but nobody expected it to happen that fast and drastic as it did. Almost over night we saw the prices jumping - and yes jumping is the right word, prices did not increase just 1,000 Dollar, they increased in 5,000 - 10,000 Dollar jumps - nearly over night on a daily basis. How major those changes were? Just one small example. Mid 2004 I sold vacant land to a young man from Germany (he inheritated some money from his grandfather and was looking into investing it in Real Estate). He paid for this lot (a building site in Cape Coral) $ 11,000. By the end of 2005 he sold this same lot for $85,000. What a nice return on his money. What a smart young man. I remember his mother, who was very mad at me that I sold this in her eyes worthless piece of property to her son. But at that time I just knew that the area where the lot was located will just take off. I just knew that the 11,000 will double in a very short time. However I did not expect that this lot would increase almost 7 times as much. Needless to say mother and son were extremly happy.

The current Market in our Area (Cape Coral/Fort Myers) shows the same signs right now we saw in 2004 just before the booming market. Buyers and investors are back and they are taking advantage of the current prices. This is bringing down the housing inventory and even with more bankforeclosures coming on the market we now have buyers and investors to absorb those property in a very fast path. Even builders are starting builidng again, they sold almost all of their inventory in the first half of 2008.  

Florida is still an area (specially the West Coast) where people want to be. Cape Coral is one of the fastest growing areas in the whole nation, the average age is by 41 years old, there is work and entertainment. We have the beaches and the nice weather.

If you are a buyer or investor and would like to invest into Real Estate in Florida - now is the time to buy, low interest rates, still low property prices and still a good choice of properties. All this will change in very near future and I think it is just a question of time that the interest rate is going up again - and probably the Dollar is gaining strength again.

For more information about the Real Estate Market in the Cape Coral/Fort Myers Metro area, please visit my Web Site at: Spotfloridarealestate.com   

Feel free tp contact me with any questions you might have.

Monika

Century 21 Sunbelt Realty

Cape Coral, Florida          

What would you do?

What would you do if you would be a business owner and would hear constantly the economy is bad? Would you hire more employees or lay off people.

What would you do as a potential home buyer or investor? Would you buy or invest if you get told the Real Estate Market is far away from recovery?

What would you do as a consumer if you hear permanently that times are getting worse? Would you go out shopping or save your money?

What would you do if you would be a teenager and everybody tells you that you have no future? Would you waste time into your education?

What would you do if you would if you hear that you will not be able to find any job? Would you go out looking for one?

What would you do if you see trash all around you? Would you clean up or add additional trash to it?

I could continue with this list for pages and pages and hours and hours. Just try to listen to the News, read the paper or talk to other people. See what you are being told every single day. Don’t you hear over and over how bad everything is? You hear some good news for example that we have less foreclosures this month than we had in the month before but even those actually encouraging news are being put into a “negative” content.

Sometimes I ask myself – are those “bad” news steered by some very smart people? If just a few people feed the media with bad news about the housing market and the economy in general is this working in their favor? Are those few people taking advantage of the “low” Real Estate Prices and the falling stocks? Are they buying now in those so called “bad times”? If this is the case the same few people can do the opposite in a few month and feed the media with good news about the booming housing market and the great investments in stocks? Just to sell then with a very high profit?

The Stock Market and the Real Estate Market are very sensitive, just a few bad news will lead the markets to go in one or the other direction. Just a few people could really influence the development of an either booming or a declining market. The only thing they need to do is to feed information to the media in one or the other direction. The Markets will react how ever those people/media are steering it.    

I know this is a bold theory but think about it – can’t there be some truth to it?

The Real Estate Dilemma

Home Made Crises?

 

This is my personal opinion only and may or may not reflect the opinion of fellow Realtors or the company I am working for. 

 

 

As a Realtor in Southwest Florida since almost 15 years I have seen and worked in both, Buyers and Sellers Markets. Normally it is just a healthy cycle and the Real Estate Market based on supply and demand regulates itself.

 

But this time around it seems to be more complex. Not that we don’t have buyers and investors who are ready, able and willing to buy. They are here,  Europeans are very attracted due to the good exchange and a lot of Americans agree NOW is the time to buy.

 

We would be able to reduce the inventory way faster than it happens right now. But the lenders and banks are trying to compensate their mistakes from the past with the other mistakes today. From lending to everybody in the past they tightened the guidelines and make it extremely hard to obtain loans. Even the Federal Rate Cuts are not really helping, just for this reason.  

 

A lot of those properties bought in the sellers market to high prices and with adjustable rates are ending up in short sales or bank foreclosures. The supply increases, the prices drop.

 

This is not the only problem we are fighting in today’s Market.

 

Lets take the “Short Sales”. In a Short Sale the lender agrees to take less money than is owed for the property. Unfortunately in a lot of cases the “less amount” is still higher than the current market value. The educated buyers and investors have a lot of inventory to choose from and they will choose the “best deal” for their money. Overpriced short sales are going into Bank Foreclosure and are creating an even higher loss for the lender.

 

Here an example out of my own experience. I had a very nice, brand new home listed on a golf course. This property was offered as a Short Sale. The Seller owed about $500,000 Dollar. The list price as a short sale property was 399,000. Another Realtor brought me an offer for 340,000 cash and fast closing. This actually was over fair market value. After month and month with no word from the lender in regards to this offer, the lender finally  denied. A few month later the same property went into bank foreclosure and is now offered for 235,000. Beside the costs for the lender to go thru the foreclosure procedure and the consequences for the owner, they also lost about 120,000 just in not taking the original cash offer.

 

This is not a single case and unfortunately Realtors can fill books and books with similar stories.

 

Buyers, Investors and Realtors are getting frustrated because there is no communication, no update from the lender for weeks or month. For just this reason a lot of Buyers and Realtors are simply avoiding short sales all together.

 

We have cases of willing and able buyers or investors, with 30 – 40% Down Payment, applying for a commercial loan, for land, construction or development. A development which would create jobs in construction and later to manage and run. Most conventional Lenders are not even looking at loans like this anymore. Even so it would solve a lot of problems for our economy. Those investors have two options - either leave it alone or turn to private investors. I am personally working with an investor who is planning to build a unique facility in Fort Myers. Since almost 1 year we are trying to line up the financing. My client has 35% down payment and an excellent credit and reputation. Another client of mine is trying since about 4 month to invest in a good going business including Real Estate, he also has almost 40% Down payment toward the loan. This seems to be a “mission impossible”. Federal Rate Cuts are not doing any good here either.

 

Still not enough – Dealing with Bank Foreclosures is not that easy anymore either. Most Banks hire attorneys, those attorneys are overloaded and to get closing documents takes weeks and month. Even cash deals, supposed to be so easy are taking for ever until they can be closed. Those buyers are getting frustrated and turning away for good. They do not need this stress just for spending their money, they can do that otherwise and way more relaxing. Banks and Lenders should realize that every day the property does not close costs their money, adds up interest and other costs.

 

We Realtors could help to overcome the current Real Estate and Economic crises, we just would need some lenders or attorneys to realize that they need to hire able people to make the whole procedure of buying Real Estate easier and smoother. They should not lay off people, they should hire people, may be Realtors, who know what they are doing and get things done in a timely manor. This actually would save them money since they get those properties faster off their books.

 

Banks and lenders should not go from one extreme (lend to anybody and everybody) to the other extreme (tighten their guidelines to nearly impossible). They need to find a golden middle. Learn out of past mistakes, draw a line and make it better (not worse).

 

We all are sitting in the same boat (Lenders, Investors, Buyers, Realtors and actually everybody world wide), we need to realize this, everything is going hand in hand. We need to work together and we can turn the whole economy  around (not only the Real Estate Market). We can make it work again for everybody.

 

This is my personal opinion only and may or may not reflect the opinion of fellow Realtors or the company I am working for. 

 

Monika Wilson

 

In my last Blogs I was talking about that the Real Estate Market in Southwest Florida will recover faster than expected. The market is on a turning point right now. We are seeing multiple offers on good priced properties. We did not have this since quiet a while. Buyers and Investors are seeing their chance to get into the market with the prices still low and the inventory still high enough. Chances are very high to find the right property to a very good price right now.

If you are a seller and want to sell your property fast, one way to do so is to price it right, drive thru your neighborhood and look at properties currently for sale, look at those properties and compare it to the property you are trying to sell. Then put yourself in the buyer's shoes. Which property would you pick? This will show you fairly quick what you as a seller need to do, to convince the buyer to buy your property and not the one down the street.

If you are a buyer/Investor, now is the time to buy, Interest rates are still low, prices are still down. But Invetory is decreasing and prices will increase. In 2004 that almost happened over night, here also everybody expected the Market to take off but nobody expected it to happen that fast and that high. I am not saying that that will happen again and this time probalby not that fast either. But I would not take the chance to miss out if it would.