Bradenton Florida Real Estate News

Friday, June 30, 2006

Real Estate Pros Are Still Optimistic

This was the headline of a story in our local paper. Here's the story:

MELISSA FOLLOWELL
Herald Staff Writer

PALMETTO - The real estate craze of 2005 may be just the beginning of things to come, an expert said Thursday.

"Between five and 10 years from now, it will be a better market than last year," said John Tuccillo, former chief economist for the National Association of Realtors. But, he added, "I'm not saying the next 18 months are going to a picnic."

In addition to his former position with the National Association of Realtors, Tuccillo runs his own consulting business and is a professor at Catholic University.

Tuccillo and local real estate broker Michael Saunders of Michael Saunders & Co. on Thursday evening addressed more than 100 real estate agents and select clients about the current state of the real estate market as well as what the future may hold.

"They can hear it from me but it helps to hear it from a neutral party who is a national expert," Saunders said.

Sales in the local real estate market fell off steeply during the first quarter of this year and many have tied that to the constantly rising prices, Tuccillo said. However, he said, the key to housing markets actually lies with jobs and population changes, not price.

The Sarasota-Manatee metropolitan statistical area's employment growth ranks seventh in the country, Tuccillo said, guaranteeing a need for housing.

People who choose to retire in the area contribute to the growing number of jobs. These retirees are job creators, not absorbers, he said.

Saunders, like other real estate professionals around the area, has seen a slight pickup in traffic in the last month or so. While things are nowhere near the pace of last year's sales, Saunders said a continuation of the frenzy seen in 2005 would have been more of a detriment than an advantage.

"It was not healthy where it was, and this is a period of correction," Saunders said.
Sales are on par with those in 2003, which was a great year, though not on par with 2004 and 2005, he said.

Although growth continues throughout Manatee and Sarasota, Saunders said smart growth has been the key to success.

"We haven't had the overbuilding of cities like Miami and Las Vegas," she said.

Tuccillo agrees that the current excess of inventory on the market is a normal spurt often seen in fast-growing communities. "But no matter what kind of market it is, appropriately priced homes will sell relatively quickly," Tuccillo said.
==============

Hurray for some good news! Florida is still a desired destination with good job growth. This market correction will pass and better days are ahead!

Thursday, June 29, 2006

Florida Foreclosures Leap Up

Florida foreclosure filings jumped by 6 percent from April to May, according to a study by RealtyTrac Inc., an online data concern. That's one new filing for every 821 Florida households.

By contrast, national foreclosure filings rose by less than 2 percent, averaging about one new filing for every 1,247 U.S. households.

The numbers for St. Lucie County were even more grim. One of every 719 households there was the subject of a foreclosure filing in May, reported Irvine, Calif.-based RealtyTrac. And in Palm Beach County last month, RealtyTrac found, one of every 561 households faced a new foreclosure action -- almost double the national average.

"Unfortunately, this is not a blip," said Jack McCabe, president of McCabe Research and Consulting in Delray Beach, which months ago warned of coming foreclosure problems. "It is going to be a trend for quite a period of time."

Continue reading at http://tinyurl.com/ocbce

(Source: Planet Realtor)

Wednesday, June 28, 2006

Today's Homeowners Worry About Rising Payments

WASHINGTON (June 27, 2006) – One out of three Americans worries that rising monthly payments – especially property taxes and energy costs – will force them to sell their home and buy a less expensive one, according to the fourth annual National Housing Opportunity Pulse, a survey released today by the National Association of Realtors®.

The survey also found that, by a 2-to-1 margin, Americans believe that high monthly payments rather than high down payments are the greatest obstacle to buying a home. Rising property taxes are the leading concern associated with owning a home (34 percent), followed by increasing electrical, fuel and other energy costs (28 percent). Only 14 percent said rising mortgage interest rates would keep them from becoming homeowners.

“It’s clear America is facing a crisis in housing opportunities with nearly two-thirds of families concerned about being able to find a home they both like and can afford,” said Thomas M. Stevens, 2006 NAR president from Vienna, Va., and senior vice president of NRT Inc. “Many families are struggling to meet the high cost of homeownership, and increasingly those costs are property taxes and energy utilities.”

Read more at http://tinyurl.com/m4chq

Source: National Association of Realtors

Here in our Bradenton - Sarasota, Florida market housing affordability is a big issue. Homeowners are enjoying record appreciation rates, but first-time buyers are finding it difficult to afford a home.

Tuesday, June 27, 2006

50 Riskiest Markets (Bradenton is NOT)

This just in regarding the latest report from PMI Mortgage Insurance Co., a subsidiary of The PMI Group Inc.:

"Thirteen real estate market areas have more than a 50 percent chance of falling house prices within two years, and eight of those areas are in California, three are in Massachusetts, one is in New York and one is in New Jersey, according to a quarterly report by PMI Mortgage Insurance Co., a subsidiary of The PMI Group Inc."

For a PDF copy of the 12 page report you can contact me at
http://www.bradentonrealestate.com/index.php?fuseaction=site.contact Just ask for the "50 Riskiest Markets Report."

Florida Home Prices Up 11 Percent

I just received this news today from the Florida Association of Realtors:

"ORLANDO, Fla. -- June 27, 2006 -- With mortgage rates still ticking upwards, Florida's housing sector in May continued to adjust to changing market conditions, including a greater inventory of homes available for sale in many areas. Statewide, the existing-home median price rose 11 percent to $256,400 last month; a year ago, it was $232,000, according to the Florida Association of Realtors® (FAR). A total of 18,680 existing single-family homes sold statewide last month, a decrease of 24 percent from the 24,523 homes sold during the previous May, according to FAR.

"In 2001, the statewide median sales price was $125,200, which is an increase of about 104.7 percent over the five-year-period, according to FAR records. The median is a typical market price where half the homes sold for more, half sold for less."

---------

Our area ( Bradenton - Sarasota ) continues to be a highly desirable area. In fact our area has seen a 145 percent home price appreciation over the past 5 years! Amazing.

Monday, June 26, 2006

New Home Sales Unexpectedly UP in May

WASHINGTON -- June 26, 2006 -- Sales of new U.S. homes rose in May, surprising economists who had been forecasting that housing would slow down because of rising mortgage rates.

The Commerce Department reported that sales of new single-family homes increased by 4.6 percent in May to a seasonally adjusted annual rate of 1.234 million units. The median price of homes sold did decline to $235,300, a drop of 4.3 percent from the April sales price.

Analysts are still looking for sales of both new and existing homes to fall by around 10 percent this year as rising mortgage rates crimp demand. The lowest mortgage rates in four decades helped to propel sales to five straight annual records.

The 4.6 percent increase in sales pushed the sales rate to the highest level since last December and followed increases of 5.9 percent in April and 7.3 percent in March. The previous months' increases had been helped by unusually mild weather.

(Read more at http://tinyurl.com/p7674 source: Planet Realtor)

Could this be the bottom of the pullback in both price and volume for home sales? We may be seeing a turn around in the housing market -- just as expected by those in the industry. All the disasterous predictions just aren't coming true.

Our Bradenton - Sarasota market may be bottoming out and poised for a return to a more stable upward market. Check this blog around July 6th for our latest Current Market Condtions Report.

Friday, June 23, 2006

How To Steal Your Neighbors Property

From an article by Robert J. Bruss:

'SQUATTER'S RIGHTS' ARE THE LEGAL BASIS FOR STEALING REAL ESTATE. Every state except Louisiana adopted variations of English common law in the 1800s and early 1900s. Louisiana chose the French Napoleonic Code, which is often very "foreign" to non-residents.

For 49 states, English common law includes the tradition of "squatter's rights." Simplified, that means if I occupy your real estate without permission and pay the property taxes for the number of years required by state law, I can eventually claim full fee simple absolute ownership of your property.

For example, the house adjacent to mine has been vacant about three years. If I moved in and continuously occupied it, paying the property taxes when they come due, I could eventually acquire title to this property. However, I'm not going to do that.

The reason is I observe the legal owner occasionally visits his empty house. He has even applied for a building permit to remodel it. If he found me living in his house, he would summarily throw me out as a trespasser so I have no hope of ever acquiring title to that property by "squatter's rights."

TWO LEGAL METHODS TO STEAL YOUR NEIGHBOR'S PROPERTY. Each state has laws allowing two methods of stealing real estate without going to jail.

1. ACQUIRE LEGAL TITLE AND FULL USE. The most difficult method to steal your neighbor's property is "adverse possession." That means you must occupy the entire property without the owner's permission for the required number of years.

California has the easiest "squatter's rights" adverse possession law. Just occupy a California property for five years without the owner's permission, pay the property taxes, and you can acquire full ownership by then suing the legal owner in a quiet-title lawsuit. It's that easy.

However, Texas and several other states have much tougher adverse possession laws, requiring "open, notorious, hostile, exclusive and continuous occupancy" for 30 years. Needless to say, not many Texans claim title by adverse possession.

Other states have adverse possession limits between these five- and 30-year extremes.

The nation's leading adverse possession case is Stevens v. Tobin (251 Cal.Rptr. 587), decided by the California Supreme Court. Thomas W. Stevens sued the legal owner in a quiet-title lawsuit. He proved that he adversely possessed for 15 years the San Francisco apartment building at 1899 Oak St. in the famous Haight-Ashbury District. Stevens showed open, notorious, hostile and continuous possession. However, he was unable to prove payment of the property taxes. Therefore, he lost his attempt to gain title to the building by adverse possession.

2. STEAL PART OF A PROPERTY BY HOSTILE USE. Perhaps you don't want to acquire a neighbor's entire property without paying, but you just want to use part of that property, perhaps to plant flowers or vegetables.

All you need is a prescriptive easement. The legal requirements in each state are usually the same as for acquiring title by adverse possession, but you don't have to pay any property taxes.

In other words, you must occupy a portion of your neighbor's land by open, notorious, hostile and continuous possession for the number of years required by state law. Interestingly, use need not be exclusive so you could share the prescriptive easement area with the property owner or another user.

However, permissive use defeats ever acquiring a prescriptive easement. If your neighbor says "Sure, go ahead and use part of my property," you will never obtain a permanent prescriptive easement.

Prescriptive easement examples include driveways, paths or any portion of a property that is continuously used without permission.

To perfect a permanent prescriptive easement, after the required number of years' use, the claimant should bring a quiet-title lawsuit against the titleholder.

PREVENT LEGAL THEFT OF ALL OR PART OF YOUR PROPERTY.
(More at http://tinyurl.com/g2uzf )

{Source: Inman News}

Experts Predict Soft-Landing for R.E. Market

SAN FRANCISCO -- Unless there are substantial job losses, the real estate market appears on track for a soft landing, said economists for University of Southern California's Lusk Center for Real Estate.

"We don't believe the housing market is going to fall off a cliff. We don't really subscribe to the hard-landing story," said Stuart Gabriel, Lusk Center director, during a presentation Thursday at the annual PCBC event, a conference for home builders held at San Francisco's Moscone Center.

This is, however, a time of "stagflation," or economic stagnation coupled with inflation, Gabriel said, and the real estate market is losing steam -- with a general slowing in price-appreciation and sales. (More at http://tinyurl.com/n2uqx )

Thursday, June 22, 2006

Cash Back at Closing Scams

Cash Back at Closing:
Appealing Arrangement or Sinister Scam
by Ralph Roberts

Cash back deals are stitched into the very fabric of the U.S. economy. Manufacturers promote their products with cash rebates. Credit card companies offer cash-back on purchases. Even banks dangle cash-back deals to attract new customers. Now, home buyers and con artists are jumping on the cash-back bandwagon, and plenty of our own people -- real estate professionals -- are tripping over themselves to cater to them.

On its surface, cash back at closing seems like a win-win situation. The buyer simply pays a little more for a property than it's worth, and the seller agrees to kick back the surplus cash to the buyer.

For buyers, it can be a savvy financial move, allowing them to pay off outstanding credit card debt or use the extra cash for home repairs and renovations. The seller unloads his house at close to or better than his asking price. The real estate agent gets a bigger commission. The loan officer chalks up another successful loan. And the lender scores a larger loan and stands to earn more interest over the life of the loan. If anything seemed like a win-win situation, cash back at closing is it!

Unfortunately, as with most deals that seem too good to be true, cash back at closing schemes are just another way of scamming someone -- in this case, the lender, who's fooled into making a risky loan.

But lenders aren't the only losers. Buyers are often tricked into buying more house than they can afford. Housing values in the area are artificially inflated, making housing less affordable and raising property taxes. Honest real estate agents lose business to dishonest agents who offer cash back deals. And neighborhoods begin to buckle when homeowners default on the inflated loans and their properties end up in foreclosure. Perhaps that's why cash back at closing schemes are illegal.

Illegal?! Yep.

Read more at http://tinyurl.com/ozb4o

Wednesday, June 21, 2006

Manatee County Population Booming

MANATEE - Unincorporated Manatee County's population boom continued last year, far outpacing growth in the county's towns and cities, according to new estimates released today.

An estimated 228,197 people lived in Lakewood Ranch, Parrish and other unincorporated areas of Manatee last July 1, the U.S. Census Bureau said. That's 9,631 more people than a year earlier, and eight times greater than the 1,174 residents the county's six municipalities added during the same period.

Local officials said Tuesday the disparity was no surprise, given that there's more undeveloped land outside Manatee's cities than within.

"They're building houses about as fast as they can out there," Bradenton Mayor Wayne Poston said.

"Boy, around Parrish, it just boggles my mind," added Palmetto Mayor Larry Bustle.

Bradenton remained Manatee's largest city, with an estimated 53,917 residents last year. Palmetto's population estimate was 13,510 people, followed by Holmes Beach (5,100), the Manatee portion of Longboat Key (2,627), Anna Maria (1,867) and Bradenton Beach (1,561).

Overall, Manatee grew by an estimated 10,805 people from mid-2004 to reach 306,779 in mid-2005, the Census Bureau previously said. The estimates released today were for almost 19,500 towns, cities and other incorporated places.

Read more at http://tinyurl.com/g5h65

These projections for future growth in Manatee County is good news for our real estate market. Even though we are currently experiencing a market correction, future demand is anticipated. Once our excess inventory is absorbed we should see strong appreciation rates return.

Tuesday, June 20, 2006

Three Rules About the Real Estate Market

1. Real estate is governed by the law of supply and demand. This rule is absolute and without exception. The appreciation of a market, the expectations of buyers and sellers, and the velocity of market sales are all dictated by the supply of – and the demand for – real estate for sale.

As a recent example, we saw rapid appreciation and a frenzied response by buyers in the U.S. real estate market in the years 2002 through 2005. This response was caused by the fact that demand for real estate was at an all-time high while the supply was limited. This caused rapid appreciation, with home sellers receiving multiple offers within days or even hours. At one time during that period, homes in southern California were selling, on average, at 18% above the listed price – the result of a market condition where demand outstripped supply.

2. Real estate is governed by the law of cause and effect. Put differently, positive situations cause positive outcomes, and vice versa. For example, a vibrant economic growth leads to a vibrant real estate market and strong appreciation of homes, while loss of jobs and a languishing economy produce exactly the opposite effect.

As a specific example, as the baby boom generation matured, it fueled an explosion in second home purchases so strong that more than 21% of 2004 U.S. home sales were second home purchases – most acquired by aging baby boomers. This created desire for additional housing that affected the construction and home values in second home markets nationwide.

3. History will repeat itself. In any marketplace, there are cycles. Periods of rapid real estate appreciation are followed by stagnant periods where values stabilize or even decrease. By acquiring marketplace knowledge, you can foresee trends both for your own benefit and for the benefit of your clients. For example, in a number of key U.S. market areas more than 40% of new home loans are being written as low money down, interest only mortgages. These limited-equity position purchases are being made on the assumption – the gamble – that the recent rapid-appreciation cycle will continue and that housing prices will climb ever higher. When the growth trend stops, as it has many times before, home values will decline, mortgage balances will exceed resale prices, and a large group of home buyers will be forced to walk away from their homes as banks foreclose on a significant number of loans. This will further lower values and stagnate growth, as it has many times before.

5 Reasons Some Homes Don't Sell

Spring is the traditional peak sales season for houses and condos. Summer is also usually very good until the traditional August slump, especially for families who want to relocate before school starts. More prospective home buyers are in the market at this time of the year than during any other season.

But 2006 is proving to be a bit different. Although 2005 was a record home sales volume year, the number of residence sales has slowed this year. There could be several reasons, such as adverse weather in many areas and slowly rising mortgage interest rates. In a few communities home sales prices have taken a slight dip so prospective buyers might be waiting to see if desperate home sellers reduce their asking prices. Another reason for waiting to buy a house or condo is the inventory of available listings is slowly rising, thus offering more homes available for sale. In summary, for most communities it is definitely a "buyer's market." That means there are more homes listed for sale than there are qualified home buyers. The result can be bargain prices for savvy home buyers.

5 Reasons Some Homes Don't Sell
1. The asking price is too high
By far, this is the top reason a home doesn't sell. Although you might be just testing the market, prospective home buyers are very smart and they know an overpriced listing when they see it. Worse, their buyer's agents won't even bother showing homes with asking prices above recent sales prices of comparable nearby homes.

2. The Home is difficult to show
Seller's who make a home difficult to show will "turn off" agents. The home should be in the Multiple Listing Service, on a lock-box system, and easy to show at a moments notice.

3. The home is in poor condition
Most home buyers want to purchase a residence in near "model home" condition where all they have to do is turn the key in the front door and move in. However, if the residence requires considerable work, that turns off all but the most die-hard bargain hunting home buyers. Your home should be move-in ready.

4. Offering the home "as is"
Closely related to homes that don't show well are those listed for sale in "as is" condition. The term "as is" means the seller offers the residence in its current condition and will not pay for any repairs. However, the seller must still disclose in writing to buyers all known defects, such as a leaky roof or a bad foundation. "As is" raises a red flag.

Whenever possible, home sellers should not offer their homes for sale "as is" because it is like waving a red flag in the buyer's face. A better alternative is for the seller to obtain a professional inspection report and have the recommended repairs made before listing the home for sale.

5. Ineffective marketing
Most agents put the listings in the Multiple Listing Service, hang up a for sale sign, and run a few ads. Successful agents do a LOT more. Your agent should have a dominant internet presence and should actively, agressively promote your listing to buyers.

(Check out Premier Team's internet presence by using any major search engine and searching on "Bradenton Real Estate". You'll find our site in the top 5 results. Pay little attention to "sponsored sites" that use pay-per-click to get list on top. Sites that show in the top 5 of search results are rated the highest and will provide the most exposure for your listing.)

Selling houses and condos in the current buyer's market requires hard work by successful listing agents. If your home has been listed for sale with a successful realty agent over 45 days and without any purchase offers, it's time to discuss the five key reasons some homes don't sell with the listing agent and make adjustments to get your home sold.

Monday, June 19, 2006

Bye, Bye Discount Brokers

We may be seeing the demise of many discount real estate brokerages as a result of market changes. A search of the Manatee Multiple Listing Service shows less and less listings being taken by so-called "discount brokers".

What's going on? Why are more sellers choosing full service Brokers? I've got a few ideas.

1. In our current market we have almost 600% more homes on the market than we did in 2005. It was so easy to sell a home then. All you had to do was stick a sign in the yard and put the listing in the MLS. It was sold in a matter of days or hours. Now, it's taking months for houses to sell. Brokers must have a detailed marketing plan, spend a lot of money on marketing, and have the staff to service and sell the listings. Discount brokers generally do little marketing, spend very little on marketing listings, and run a lean staff with little "service" provided. Most sellers today recognize the difference.

2. If you were a real estate agent and saw that the cooperating listing office was offering 1% or 2% commission compared with others offering 3-5% commission, which listing would you show? Sellers choosing an agent offering minimal compensation may discover their home isn't shown.

3. Desperate real estate agents are taking overpriced listings and discounting their commission just to get the listing. Consider this, last month there were 255 single family homes sold among approximately 3000 agents in our local MLS. There's a lot of hungry agents out there. I've heard of some Sellers who are shocked to find out their agent has now left the business. Discounting commission is a downward spiral to a failed business. Most sellers recognize this and are choosing full service brokers today.

Friday, June 16, 2006

Housing Bubble Likely to Deflate Slowly

"...are fears of a housing market meltdown exaggerated? That's the conclusion of a new study by Harvard University's influential Joint Center for Housing Studies. In its annual State of the Nation's Housing report released June 13, researchers took a more sanguine view of the outlook for the real estate market than the growing number of bears predicting that overheated markets like New York, Washington, and South Florida could see a 20 percent to 30 percent price decline in coming years. "

Read the full MSNBC article here: http://msnbc.msn.com/id/13346351/

Manatee Schools Receive "A" Grade

MANATEE - Fifty-one percent of Manatee County's public schools received an A grade from the state, and the number of local schools receiving As rose from 16 a year ago to 25 this year, according to Florida Comprehensive Assessment Test scores released Wednesday.

But the bad news was that three of Manatee County's six traditional public high schools - Bayshore, Palmetto and Manatee - received D grades.

Superintendent Roger Dearing and Carla Frazier, the district's supervisor of measurement and data analysis, said the three high schools scored enough points to warrant a C grade but were penalized a letter grade because their lowest-performing students didn't improve enough in reading.

One of the factors that determine a school's FCAT grade is how much improvement is made by the 25 percent of students who score at the lowest level.

"We really have to focus in on the bottom quartile of students in our high schools," Dearing said. "We need to make sure they are making a year's worth of progress in their reading skills."
The county's three other high schools gave the district reason to celebrate.

Lakewood Ranch became the county's first high school to rate an A in the seven years FCAT school grades have been doled out, and Southeast rallied from a D to a C.

Braden River High School, which opened this school year, scored a B.

School administrators said there was other good news in the school grades as well. No Manatee County school received a failing mark, and 46 of 49 county schools graded received a C or better.

"It was very, very good news," Dearing said. "It's rewarding to know that the new reading coaches and new reading programs we've put out there have really helped us turn a corner."
Michael Wilder, principal at Lakewood Ranch, said a "team effort" was behind his school's improved score.

"When I saw the test score, I thought about all the hard work that everybody, and I mean everybody, put into making this happen," Wilder said.

During the last school year the Manatee County School District added 42 new reading teachers and new computer-based programs to assist struggling readers.

"I think we need those reading strategies in all classrooms, not just English, but in every class," Wilder said.

One of the specific areas of emphasis for the school district was at the middle school level because those were the grades where previous reading scores tended to dip.

This year, six of the county's nine middle schools received A grades, and four middle schools improved their grades by at least one letter.

The middle schools that earned A grades were Braden River, Haile, King, Lee, Nolan and Sugg. Lee Middle jumped from a C to an A.

"We're ecstatic, everybody's really happy," said David Wernicke, assistant principal at Lee.
Among Manatee County's 31 traditional elementary schools, 18 received A grades, five received B's and eight received C's.

Myakka City Elementary principal Diane Nichols said she was overjoyed when she learned her school had earned a B, up from a D in 2005.

"Naturally we are thrilled," Nichols said. "Of course we knew all along we had a great school with a great bunch of teachers and students, but this score just reaffirms that."

In order to improve her students' performance this year, Nichols said Myakka City Elementary implemented an after-school program that tutored students in reading and math. Nichols said teachers were also involved in a mentoring program that provided extra attention to those students who scored in the bottom 25 percent on the FCAT in 2005.

"Teachers were directly assigned to those students," Nichols said. "And we kept an eye on their progress and showed them that someone cared about them. It obviously paid off."

Sea Breeze Elementary received its seventh straight A to maintain its status as the only school to receive an A grade from the state every year grades have been given out.

Manatee School for the Arts in Palmetto, the county's largest charter school, earned a B grade for the third straight year. Two other local charter schools, Bradenton Charter and Manatee School for the Arts and Sciences, both received C grades.

Community High School, a school that caters to students who have struggled in traditional school environments, received an I for "investigating," according to Frazier.

"The state has asked me to look into the test scores at Community High because they only tested 83 percent of their students," Frazier said. "Schools need to test 90 percent of their students or above to qualify for a grade."

Overall, Wilder said the public should be impressed with the entire district's scores.
"Everyone has their own opinion about the FCAT, whether that kind of testing is beneficial or not," Wilder said, "but the main question that needs to be asked is: Are our kids better readers? And the answer is, 'Yes.' "

(Source: Bradenton Herald MICHAEL BARBER
Herald Staff Writer)

Thursday, June 15, 2006

Current Market Conditions Report - May

Every month we publish a Market Conditions Report. If you would like a copy, please ask for it by email. You can contact us through this website.

RESIDENTIAL LISTINGS
Number of Listings Up 4.5% over last month
Number of Listings Up 546% over last year
Sales are down 42.5 % from last year
Median sale price is down 12.8% from the high of 2005

CONDO LISTINGS
Number of Listings Up 4.2% over last month
Number of Listings Up 576% over last year
Sales are Down 31.1% from last year
Median sale price is down 14.9% from high of 2005

We continue to see a strong market correction in the Bradenton - Sarasota Florida market. It' s Buyers market for sure!

Pricing Your Home To Sell

Marie and I are working on an upcoming seminar we will call: Pricing Your Home to Sell.

I found this article that straightforwardly deals with pricing in a Buyer's market like we have here in the Bradenton - Sarasota Florida market.


Pricing Right Sellers' Job No. 1
by M. Anthony Carr

It seems during a slowing market, the last person to get the message that the house needs a lower price is the seller. After all, the seller has the most to lose by "improving" the price and it's a tough decision to let go of a dream of cashing out.

A sellers market builds over time. If new jobs enter a particular area and housing doesn't keep pace, home shortages create a sellers market where prices increase and bidding wars begin. Then, one of two events happen to make a market cool down: the economy stops growing or prices become too expensive (combined with an ample supply of rentals). A normalized/buyers market is born and sellers need to get on board or hit the showers.

When people ask if the market is crashing, I just point out that if you were driving at 120 mph and slowed to 75 mph, how would it feel? The lower speed limit may seem a lot slower, but it's still faster than the speed limit.

We're running at that fast, but slower pace, now.

Nevertheless, as inventories grow and days on market increase, those in the business know what will sell a house more than anything else -- a price correction. Call it "reduced," "price cut," "realignment," "price improvement," "repositioning," or whatever you want -- the price needs to come down to where the buyers are biting.

I've collected quite a few excuses that sellers and some agents hold onto, instead of biting the bullet and bringing down the price.

"My house is worth it." Well, according to who? Usually, this statement is followed by a shopping list of items that have been added to the house: hardwood floors, 9-foot ceilings, new appliances, upgraded bath/kitchen, you name it. Yeah, your house is unique, just like everybody else's. The reality is while your house may have all those neat amenities, so do the other dozens, scores or hundreds of homes in your market area that are also on the market.

"It's a great looking house." It better look great if it's going to beat out the competition. Location, price and condition will always be a factor in any market. It may look great, but looks have nothing to do with real value.

When you start thinking that your house pales all the competition it means one thing you probably haven't seen other houses like yours on the market.

"I have to get this much or I can't sell." Oh, I really like this one. What a seller needs doesn't matter to the buyer. The buyer is looking for as much value in a community of high-priced houses. In the DC area, the average price lingers around $550,000. For that price, many buyers want the house to look good, have plenty of amenities and be connected with a realistic seller who is motivated.

"If I can't get my price, then I'll take it off the market." My question to that statement is: "Then why are you on the market to begin with?" Look at what it's going to take to sell your home and realize your true goal -- getting that next property. Looking at only what your house will draw is too short sighted. The real question is, "What kind of deal can I get on the next house?"

The reality of most sellers, when they are dropping the asking price, is that they are still walking away with a boatload of money, just not as much as they wanted. They really haven't "lost" anything. They've doubled their gain.

When pricing your house, look at these hard-core realities: what were the last few "solds" in my type of home; what is my true goal -- to get a certain amount of gain, or to get to the next house; and, finally, am I really in the game or am I playing around? Get serious. Price right. Get the next home of your dreams.

1031 Exchange Into Your Dream Home

Can you use a 1031 exchange to buy your dream home and avoid paying capital gains tax?

A new IRS rule adopted in 2004 makes this possible. You must carefully follow these steps:

1. Sell your current investment property and have the sales proceeds held by a qualified third-party intermediary.

2. Buy your dream home and rent it out for a least 6 to 12 months after purchase to show rental intent. Then you can move in and convert it to your personal residence.

3. If you plan to sell it and claim your $250,000 or $500,000 principal residence exemption of IRC 121, you must own it at least 5 years and live in it as your principal residence at least 24 of the 60 months before the sale.

(We are Realtors and cannot give you tax advice. Consult with your tax professional.)

Want to learn more about 1031 Exchanges. Attend our seminar tonight - June 15,2006 in Bradenton, Florida. See the details at:
http://www.bradentonrealestate.com/?fuseaction=site.seminar

Wednesday, June 14, 2006

Today is Flag Day. Why is that important?

Flag Day has been celebrated on June 14 since President Truman signed an act of Congress on Aug. 3, 1949, designating June 14 as “National Flag Day.”

Think of the last time, though, that you considered what it meant to be able to fly Old Glory in front of your home or business - you don't have to get permission and you have a choice about doing so.

That's what is beautiful about the American flag: the freedoms and choices it gives us.We can fly a flag or not.We can be proud of it or not.We can salute it or not.It represents us all, just the same.

Continue reading at http://tinyurl.com/rke4x

Housing Outlook is Good

Harvard study says there may be bumps along the way, but that the long-term health of the housing market is intact.

NEW YORK (CNNMoney.com) - The housing market is entering a down cycle, according to a report from Harvard's Joint Center for Housing Studies, but is unlikely to undergo a severe reversal.

The market may face risks as interest rates rise, decreasing affordability and expanding inventories, according to the study, but the market will suffer only a modest downturn unless the broader economy collapses and jobs dry up.

"There may be tough times ahead," says Nicholas Retsinas, director of the Joint Center for Housing Studies at Harvard, "but housing will emerge stronger than ever."

Read the rest of this article at http://tinyurl.com/rhy9b

Tips For Selling in a Buyers Market

The problem with market slowdowns is that the United States hasn't had one in more than a decade. In fact, you'd have to go back to the early 1990s to find the last extended period of time when homes weren't selling well in some locations.

Since then, nearly every major metropolitan area has experienced if not a strong seller's market (when the number of buyers outpaces the number of homes for sale), then at least an active market where homes appreciate anywhere from 5 percent to 41 percent in value each year and rarely stay for sale for longer than two to three months.

My how things have changed -- and sellers are suffering. Real estate agents and brokers seem out of practice in dealing with buyer's markets (when there are more homes for sale than buyers to purchase them). Of course, it's not their fault. Many of today's real estate agents and brokers weren't even in the business in the early 1990s. They've never worked through a true buyer's market.

And it looks like this one qualifies. In many real estate markets across the country, prices are being cut, the amount of time homes sit on the market has lengthened, and the "inventory" -- the number of homes for sale in a given area -- has increased dramatically.

If you're a seller, you'll want to do everything you can to bring as many buyers across your threshold in as short a time as possible. Here are a few suggestions to help increase your house-hunting traffic:
  • Find the right agent at the beginning of the process. Ask the agents to do a comparative marketing analysis (CMA) and to list the marketing strategies they will employ while selling your home. These could include color magazine ads, or sending out mailings, such as flyers or postcards. You may also have to pay a little more in commission. Don't make the mistake of listing with the agent proposing the highest price. In fact, it's best to pick your agent first and then discuss price.

  • Give a bonus to the agent who brings the buyer to the closing table. While a great agent isn't going to force a buyer to purchase a house just to get a cash bonus, he or she probably will include your house as an option as long as it meets the buyer's criteria. Other options include big gift certificates, family vacations, or, if you're trying to sell a very expensive house, you might consider giving away a fancy car.

  • Let your neighbors know your house is for sale. Make sure to drop a complete listing sheet into your neighbors' mailboxes. If your neighbors like the neighborhood, they'll be more likely to recommend your house to friends and relatives who are shopping around for a new home. Want to goose your return? Offer a gift certificate to any neighbor who recommends the person who ultimately buys your house.

  • Take advantage of technology. Make sure the agent you choose has a Web site that really works and that can accept multiple photos of your property. You can even set up your own Web site so that anyone searching the Web for property with your home's amenities or in the neighborhood will find it. More than 85 percent of buyers start their search for a home on the Internet, which means you've got to "wow" them online or they'll never even look at your house in person.

  • Give your landscape an upgrade. Spending $500 to have your yard professionally overhauled will pay off big-time now that summer has come. Have a professional landscaping company trim bushes and trees, manicure lawns, plant colorful flowers and de-weed the garden. Exterior rooms are popular, so consider buying new, matching lawn furniture and a movable fireplace pit to encourage buyers to think about spending their evenings under the starry skies in your backyard. This will help to give your home a good buzz throughout the neighborhood.

(These suggestions come from Ilyce Glink by way of Inman News)

Tuesday, June 13, 2006

Landscaping Pays Off

Money spent sprucing up the yard with trees, shrubs, lighting, and patios is well spent -- especially when it comes time to sell the home, a new study says.

The report, by Arbor National Mortgage, found that 84 percent of real estate professionals believe a house on a treed lot would fetch at least 20 percent more than one on a lot without trees.

Another of the company’s surveys suggested that while shelling out for top-of-the line landscaping may only bring in an additional 4 percent to 5 percent, spending minimal amounts has a penalty. Home with average landscaping sell for 20 percent more than homes with just fair landscaping.

Source: Orlando Sentinel, Lew Sichelman

Housing Market Outlook is Good

House prices surged faster than household income and inflation, the national home-ownership rate fell for the first time in over a decade, housing inventories shot up with slowing sales, and the volume of sub-prime loans has soared.

But despite these findings, released today by Harvard University's Joint Center for Housing, the outlook for the housing market is generally good.

"The greatest threat to housing markets is a precipitous drop in house prices. Large house-price declines appear unlikely for now. But if the economy falters, both job growth and housing prices will come under renewed pressure. This would spark higher default rates, especially among sub-prime borrowers, and turn housing from an engine of economic growth to a drag,"

Read more at: http://www.inman.com/hstory.aspx?ID=53089
(Source: Inman News)

Monday, June 12, 2006

Manatee County Real Estate Transactions

Click here to see real estate transactions posted at the Manatee County Courthouse:
http://tinyurl.com/hbxhh

Our Bradenton - Sarasota, Florida market continues to see an increase in listings with few buyers. Buyer activity has increased since school has let out.

Our team is selling several listings each month. To view our latest listings please click here:
http://www.bradentonrealestate.com/?fuseaction=site.homes

Manatee County Foreclosures Down

Manatee County seems to be bucking state and national trends that show home foreclosures are increasing.

Nationally, foreclosures in the first quarter of 2006 - January through March - have increased 38 percent from last year's fourth quarter, October through December. Florida foreclosures have increased 21 percent in the same time period, according to RealtyTrac Inc., a property tracking company.

In Manatee County, however, the change is reversed. From January through March, county residents filed for 14 percent fewer foreclosures than from October through December of last year.

The number of foreclosures in the last two months has remained steady, with 54 in April and 51 in May. Unless more than 66 owners file for foreclosures in June, this quarter will mirror the last.

Read more at
http://www.bradenton.com/mld/bradenton/business/14774444.htm

Friday, June 09, 2006

What do REALTOR's do for you?

With the backing of our 1.2 million members, NAR lobbies congressional representatives and federal policymakers in support of private property rights and housing affordability. Our efforts enable more Americans to achieve the American dream of home ownership and to benefit from the expertise of a trained, reliable real estate professional.

Here are just some of the issues we are working on:

We defend the mortgage interest deduction
As of Spring 2006, the deduction appears to be safe, but we remain on alert.

We support state efforts to curtail “eminent domain” decisions that allow local governments to seize private property for use by private interests in the name of enlarging their tax base and promoting economic development.

We are speaking before Congress and government agencies to keep banks out of real estate, which could compromise bank lending decisions and restrict consumer choice and competition.

We are working to urge Congress to pass small business health plan legislation which will give 45 million small business employees access to the same quality group health insurance plans currently available to union workers and employees of large corporations.

We educate REALTORS® about how to comply with the federal Real Estate Settlement Procedures Act to ensure that real estate closing practices are fair, ethical, and legal.

Friday, June 02, 2006

Is The Housing Boom Over?

Former Federal Reserve Chairman Alan Greenspan said Thursday that Americans’ consumption could taper off somewhat now that the U.S. housing market’s “extraordinary boom” has ended. Greenspan, in his first public U.S. speech since retiring in January from a storied tenure leading the Fed, predicted there is no danger of a total collapse of the housing market. His comments come on speculation the Fed could pause its cycle of rate hikes as a housing slowdown feeds a cooling of the U.S. economy.

“This has been quite an extraordinary boom,” Greenspan said in remarks at the Bond Market Association’s 30th anniversary dinner in New York. “Home sales are off, applications are off, everything is going in the same direction. The boom is over, and you can say that with a fairly strong degree of confidence.”

Our Bradenton - Sarasota homes sales are about 44 percent below 2005 numbers. Increasing inventory, falling prices, and stalling buyers are taking their toll.

Pending Real Estate Sales Fall for Third Month

An index that tracks pending home sales fell for the third consecutive month in April, the National Association of Realtors reported, dropping 3.7 percent since March and 11.7 percent since April 2005.

The Pending Home Sales Index, which is based on pending sales of existing homes, was 111.8 in April 2006. A sale is listed as pending when the contract has been signed and the transaction has not closed, but the sale usually is finalized within one or two months of signing, the association reported. The level of monthly sales-contract activity from 2001 through 2004 has been shown to parallel the level of closed existing-home sales in the following two months.

An index of 100 is equal to the average level of contract activity during 2001, the first year to be examined, and was the first of five consecutive record years for existing-home sales.

The association also noted that the index is based on a large national sample and typically represents about 20 percent of transactions for existing-home sales.

David Lereah, NAR's chief economist, said in a statement, "When some measures are up and others are down, it tells us that we're in a period of transition. Pending homes sales probably give us the best measure for the overall direction of the housing market, which is falling from historical highs," he said. "I see this time of adjustment as being a trough in home sales that will more or less level out toward the end of the year. Over time, home ownership remains the best investment a family can make."

Regionally, the index in the South rose 1.4 percent in April to 129.4 and was 5.7 percent below April 2005. In the Northeast, the index fell 5.5 percent in April to 106.7 and was 9.3 percent below a year ago. The index in the Midwest declined 5.6 percent to 100.3 in April and was 16.6 percent lower than April 2005. The index in the West dropped 9.8 percent to 100.2 in April and was 19 percent below April 2005.

Source: Inman News

Thursday, June 01, 2006

Where Does Florida Go From Here?

A new statistical analysis of housing price cycles in 100 major metropolitan areas suggests that real estate action is shifting to areas that didn’t enjoy the recent housing boom.

Christopher L. Cagan, director of research and analytics for First American Real Estate Solutions, examined historical housing price movements and concluded that middle America markets like Columbus, Ohio; Indianapolis; Houston; San Antonio; Memphis, Tenn.; Atlanta; Cincinnati; Des Moines, Iowa; and Louisville, Ky., are due for above-average price increases and home building because of expanding employment bases and moderate housing prices.

Cagan also doesn’t believe what he calls the shooting stars of housing booms, such as most of California, Florida, Washington, D.C., New York City or Boston, are going to incinerate. He simply believes appreciation rates will dwindle to the low single digits or go flat until incomes catch up.

His bottom line: Figure out where your community is in the cycle and adapt.

Source: Washington Post Writers Group, Kenneth R. Harney

FREE Car When You Buy a Home

Our soft real estate market has caused builders and Realtors to come up with unique incentives to attract buyers. One local builder is even offering a free new car with the purchase of homes in the high $300's and $400's.

Buyers will receive either a new Hyundai Elantra or Tucson. (Call us for more info 941-746-0505)

In April home sales in the Sarasota - Manatee market fell 44 percent from a year earlier. Sellers are finding creative ways to attract Buyers. Home builders are offering free furniture packages, credit towards closings costs, and high commissions to real estate agents. All of this is in addition to serious price cuts.

If you are selling your home here are some incentives you might consider:

1. Be willing to pay a higher than normal commission to motivate your agent and selling agents.
2. Offer an additional bonus to the agent who finds the buyer and sells the home.
3. Offer to pay some of the Buyer's closing costs.
4. Provide a free home warranty to the Buyer.
5. Offer to pay the Buyer's first 3 house payments.
6. Offer to pay points to buy down the Buyer's mortgage rate.