SRQ Life - Sarasota Real Estate Market Insights

Great News for Sarasota Real Estate

2009-10-06T16:13:00.002-04:00

The Today show real estate pundit, Barbara Corcoran, declares that Sarasota is the best market on sale in the nation at this time. Check out the video here.

Short Sales- Here to Stay Although I Wish They Would Go Away

2009-09-28T13:47:00.002-04:00

Short sales are up 209% for the first quarter of 2009 over the first quarter of 2008. Expect 2010 to continue to improve upon this trend. It seems that lenders are realizing (finally) that they can get more money for a property if they just sell it short rather than go through the difficult and potentially litigious process of foreclosure or even modification. Whether or not I like these types of transactions, they are here to stay.

The biggest issue I have with short sales right now is how banks are attempting to value the assets that they have collateralizing their loans. Banks sometimes hire third party companies to help them find agents who are authorized to value property or perform what is called a "BPO" or Broker Price Opinion. These BPOs are usually performed by agents who are inexperienced and work on volume. BPOs are valued generally at about $50 per property. So, the agents who are getting orders to offer an opinion of value are being incentivized to get as many BPOs done as possible with little accountability for accuracy. Bank ordered appraisers really are not any better- they are usually from out of town with little knowledge at all of the true value the many micro-markets of Sarasota. I have seen BPOs and bank ordered appraisals off by as much as 35% of the property value. As the banks continue to try and recoup as much cash as they can from this real estate meltdown, they need to realize that they need to pay top tier agents or LOCAL appraisers to learn the correct value of the asset in question. Since most BPOs are MIA (made as instructed) one can usually expect the value to near listing price. If something is not done about these valuation practices, banks will continue to sell properties for less than they are worth OR deals will die because values come in too high, leading banks on as to the value of the property.

The solution to this problem is simple- the first thing we need to do revise or repeal the HVCC. The HVCC is a vile piece of over regulatory legislation that encourages unprofessionalism in valuing property (this is a wholly other rant that will take place later). If you are buying or selling property that involves financing, you need to know about this. The second thing we need to do is to hire more professional valuers of property. As NAR lobbies to correct this issue, consumers need to be aware that ALL transactions, not just short sales will continue to be affected by banks incorrectly valuing real estate.

As short sales continue to increase in frequency I believe that the current system incentivizes negligence and will continue to destabilize property values. As you are gauging your willingness to participate in a short sale transaction, you should be very aware that the numbers that bank is working off are most likely inaccurate.

Another RE Blog!

2009-08-04T13:12:00.002-04:00

For those of you who follow my posts, you should know that I also am a regular contributor to another Sarasota real estate blog. I just posted a very encouraging blog that you can access by clicking here.

Why I Love Being a REALTOR Part 1

2009-06-24T15:56:00.003-04:00

Being a real estate agent in this market is an interesting job to say the least. We all have our theories regarding who is to blame for the mortgage meltdown and the subprime scandals that have been so widely publicized. We are all in some ways hurt by the changes in the market, and these changes have affected REALTORs across the country in a variety of ways. From loss of income, to dealing with short sales and foreclosures, and to taking losses on personal investments, all agents have met their fair share of adversity. I understand this very well and first hand, but can I say to all the negative talkers around the water cooler- "enough already!"

There has not been a better time to be a real estate agent since 2005. Buyer interest for well priced properties is intense- oftentimes resulting in multiple offers, interest rates are low making money cheap and FHA is revolutionizing the home lending business, and banks have never been more willing to negotiate to sell properties before foreclosure even though these sales are very difficult. Realistic sellers are telling me that the market is nowhere near as challenging as they thought it would be and buyers cannot believe the values that they are getting on homes. My personal practice has never been busier!

I am thankful to have a job with flexible yet demanding hours, a great brokerage to work with, and especially to meet all the unique people that I get to serve on a daily basis as they interact with today's market environment. In short, I love being a REALTOR. If you are interested in dealing with someone who is young, energetic, and excited about this market and this business, then you need to give me a call at 941-993-3739 for great service without the grumbling.

I LOVE SHORT SALES? I think, well maybe...

2009-05-18T15:10:00.002-04:00

If you don't know what a short sale is, you might be part of the very lucky minority who is not addicted to CNN.com or any other news clearinghouse. If you don't know what a short sale is, you might have just decided to bury your head in the sand rather than acknowledge the financial woes that many around the nation and the world are experiencing right now. If you don't know what a short sale is, you might just be living the dream.

A short is sale takes place when a bank allows the seller of a property to sell it for less than what is owed. With the rapid deflation of the real estate bubble, this is what we are seeing in the market now all to often. Purchasing a short sale property has huge downsides- long waits on the bank, many banks might not even consider a short sale, reduced commissions for your broker, and frustrating time consuming negotiations with the lender. Being on the selling end of a short sale is much worse. You might be struggling with an impending bankruptcy or foreclosure, have enhanced anxiety and loss of sleep due to the situation, etc.

If a short sale is possible on your property, you will most likely end up in a much better place than if you allow your property to go into foreclosure. As more and more of properties on the market are becoming short sale situations, I have spent the last 3 months adapting myself to that market. If you or someone you know is in a short sale situation, make sure to consult with me. I have built a team of the right qualified professionals who can assist with getting a short sale done much more quickly and painlessly than through other traditional channels.

A Word About "Foreclosures"

2009-04-21T11:58:00.003-04:00

I have gotten many calls lately from buyers wanting to purchase foreclosures. I also recently had a call on one of my listings from a woman who loved the house, loved the price, and when I told her the house was not a foreclosed property, she hung up. It's official- the most value oriented flock of buyers in recent history are clamoring for something that may not even be worth it at all- the elusive foreclosed property.

I would like to clarify that buying a "foreclosure" in the literal sense would actually be buying a house that is in foreclosure- a short sale. Short sales have their own hassles which I will not go into here. So buying a foreclosure is not what buyers want right now, it is buying an REO, which translates to Real Estate Owned. REO's are also know as bank owned property. Bank owned properties are often attractive because they can be closed fairly quickly and are offered just at or below market. I do think they provide a good opportunity in some instances, but I think buyers are overlooking other deals just for the sake of buying an REO. Most REO properties need some work and are priced very fairly. Many bank owned properties will receive multiple offers which create a bidding frenzy and play to the banks advantage. I have recently closed on 4 of these properties and I am going to offer a few helpful hints on the process:

1.) Don't Just Sign the Bank Generated Addendum - The BGA is perhaps the most unfair, biased and difficult document out there. According to one attorney friend that I have, no one in their right mind would sign unless they thought they were getting the deal of the decade. Thoroughly review what you are signing. I would recommend retaining legal counsel to help evaluate the document. Whatever you do, just realize that once you sign that document, the Bank is driving the transaction.

2.) Be Realistic About Timeframes - The Bank will be totally unfair with how long they give you for inspections and they will also charge you a per diem for everyday past closing they have to wait for you to close. The goal is to close transactions as quickly as possible, but in the midst of this, the bank's closing agents have become backlogged. The bank can delay things as long as they want without penalty. So, just keep in mind that you could be waiting for a long time.

3.) Do Your Own Title Search - The Bank will almost always want to pay for the title work and the title insurance policy. Let them do this to save a little money and keep the process simple. What you should not do is trust their title search to be comprehensive. I have seen some abhorrent mistakes on the title work of these closing mills. Hire someone you trust in the business to help look at the title on the property and also take the time to make sure that the foreclosure was served properly. The original owned of the property could have some recourse on a botched foreclosure.

Most importantly, make sure you are working with a strong buyer's agent who can align you with the right professionals to further assist and also help work with the bank's agent. Foreclosures can be a good source of opportunity in this market, but not the only source. Proceed with extreme caution and diligence as you consider purchasing a foreclosure.

Cold Times in Sarasota

2009-01-22T09:26:00.004-05:00

Yes, this is frost. Taken this morning in my front yard. Not often do we see this type of cold in Sarasota. Many of my clients from the north are planning escapes to Sarasota to try and shake temperatures as low as -50 degrees in some parts of the country. Despite signs of cold in the air, I do see some indications that the chilly real estate market has some chance of warming up in the near future. Take a look at the statistics from November 2008 (latest available). What I see is a strong decrease in inventory coupled with strong pending sales, adding up to near 800 combining single family and condominiums. Add in the best of interest rates, and real estate in this area has not been this affordable since 2001-2002.

If you are looking for some great deals in the single family home realm, I am really impressed with areas like Laurel Lakes and Laurel Meadows right now. One can secure a very impressive piece of property in the low $300s, almost 3,000 square feet and new construction. Send me an email or give me a call and I will scout out one these deals for you.

The Best Reason to Live in Sarasota Around the Holidays

2009-01-07T08:47:00.002-05:00

This picture was taken Christmas day at about 4pm. The beach was absolutely packed with people enjoying temperatures in the mid 70s. My family and I went for a walk and watched a beautiful sunset. After being up north for a week before this, I became extremely thankful for the unique holiday experience that Sarasota offers. Instead of white powdery snow, we have white powdery sand!

Decreasing Inventories

2008-12-16T15:08:00.004-05:00

Take a look at this graph- I find it very interesting. This data is for all of Sarasota County dating back to last September. You can see a clear decrease in properties on the market from a peak of over 13,000 in February to just over 9700 for November. That is an astounding decrease in active inventory (25%!). You can also see a trend in sold and pended homes- a clear increase from 2007. There might be several explanations for the decrease in inventory- tired sellers, bank foreclosures, etc. But with recent foreclosure numbers showing that in October the number of foreclosures decreased, one begins to wonder how long our endless supply of inventory will last. I am not an economist, and I do not claim to fully grasp the scope of our economic crisis. What I do see is shrinking inventory, and better sales numbers than last year. I don't think I could ask for a better Christmas present.

Fiery Florida Skies

2008-12-16T14:57:00.003-05:00

This is a picture that I took early in the morning before the last cold front swept through West Florida. Those ominous skies gave way to a very strong front sparking tornadoes in many areas. Winter is a fascinating time of the year in Florida...

Moratorium on Home Buying Created by the Fed?

2008-12-04T09:38:00.002-05:00

In the government's latest move, the FED is considering measures to curb mortgage interest rates to 4.5% for new home buyers and new residential loans. Click here to see the article.

As a real estate practitioner, I see the short term impacts of this as nothing short of devastating. Until the FED makes a final decision on this, buyers will most likely remain on the fence only considering cash purchases for the most attractively priced properties. If I can calm myself down enough to be patient and think about the long view, perhaps there is an upside to all this. The FED is on the right track, however they are still missing the mark. Where the aid really needs to be directed is to those who are in homes now that they cannot afford and to those who are losing confidence as they make payments on an asset that is worth pennies to the dollar on what they owe. A more sensible plan would focus on underwriting banks and sponsoring a program so that troubled borrowers can refinance their current homes to lower rates. This would free up hundreds of dollars per month for the average American, stimulating the economy from the housing sector to professional services to retail etc. In the meantime, most American industries continue to suffer until final and decisive action is taken.

Another Great Winter in Sarasota Tradition

2008-12-02T21:21:00.002-05:00

Believe it or not, there is a large surfing population in Sarasota. Today was one of those classic Sarasota days with lots of cold surf to go around. Most winter storm systems bring fresh doses of cold, sunny waves to the Gulf Coast, much to rejoicing of surfing enthusiasts across the area.

By the Way, Have You Seen the Mortgage Rates?

2008-12-02T12:03:00.002-05:00

If buyers did not have enough incentive, take a look at what the 30yr interest rates have done over the past month. If you can find a bank to lend you money, the time has never been better to buy. This is the perfect storm!

Coldest Start to Winter I Can Remember

2008-12-02T11:39:00.002-05:00

This winter is off to a blustery start. I am always amazed at how quickly the Gulf of Mexico can change temperatures from almost 90 to 65 degrees. I can remember many beach days in December and warm Halloween nights trick or treating in Sarasota. Not so with this year. I would expect all our friends from the North to want to visit and stay a while this year.

If tanning on the beach in 5o degree weather is not to your liking, there are several things to consider doing in Sarasota in cooler climates. One of my favorite winter and spring traditions in Sarasota is the Season of Sculpture. If you were wondering about the large statue near Marina Jack's you can learn more here: http://www.sarasotaseasonofsculpture.org.

Enjoy this magical time of year in Sarasota and don't forget to take advantage of all our great seasonal attractions.

A Study on Housing Slump Recoveries- Housing is Quick to Recover

2008-07-07T14:57:00.000-04:00

It is fairly obvious that we are a challenging real estate market that is mired with inventory. Most Americans fear that we are in a recession and inflation is running rampant. These facts are certainly troubling to a real estate professional and leave many searching for answers. I have been studying the housing slumps that have taken place in the last 50 years, and all of them share some strong commonalities. All downturns usually precede a recession, and all recoveries seem to be quick.
There have been 6 major housing slumps in the last 50 years. Perhaps the most severe took place in 1980-1982. While housing starts fell as much as 30% during this time, they increased 30% from prior levels within the first three months of the recovery. This trend repeats itself in the downturns of 1969-1970, 1973-1975, 1980-1982, 1990-1991, and in 2000-2001. In each scenario, housing starts increased dramatically during the first three months of the recovery. There is no disputing that this housing market slump may be the worst in 50 years, but if history repeats itself, when recovery comes, it will come quickly. One reason to expect a vigorous return to activity is the standstill that housing starts have come to nationally and locally. Builders take their cues from the economy and consumers, which by definition causes their business to be cyclical. They expand and overbuild to meet demand and they must contract and ride out the glut of inventory that they have created.
According to the Joint Center for Housing Studies of Harvard University’s report for 2008, “demographic fundamentals still point to increased housing demand over the next decade. But the excess inventory must be worked off before the demand for new homes rebounds. This in turn requires a return to stable to rising home prices, sustained job growth and accessible credit. When that happens… the inventory overhang will start to thin, prices will firm even more, and average annual production… will likely head back toward [normal levels].” Luckily, this study is based on a national level. The Sarasota market continues to show stability as the most robust market statewide. While we have a way to go, here’s to hoping that history repeats itself once again! The bulk of this segment was taken from the JCHS of Harvard University’s report for 2008, which was given to me by a client and friend.

Irrational Apathy

2008-04-11T13:54:00.004-04:00

Many have referred to the past FED leader Alan Greenspan's well spoken moniker of "Irrational Exuberance" in their attempts to grasp what has happened to the local real estate market. My travels in the real estate market have taken me to some strange places in recent weeks leading me to conclude that our market has taken a full 180 degree turn from "Irrational Exuberance" to "Irrational Apathy." My many attempts to cajole listless and lethargic buyers off the fence have been met often with silence. Only the true risk takers- or let's call them the "savvy-" have been able to cash in on prices that defy common sense.

Dare to dream with me for just moment. The state of Florida has approximately 34 million acres in it, with just over half of that land being owned by the government. According to the US Census Bureau, in 2006 the Florida state population was 18,089,888 or less than one acre per person. Let's not forget that a lot the acres I am talking about are zoned for agricultural purposes such as raising cattle or growing oranges. Let's also remember that there are a lot of places in Florida that are far less appealing than Sarasota. With the population increasing by 13% from 2001 to 2006, one can see where this argument is heading. The demand for and scarcity of land in Florida is in direct tension with the current market conditions. In many ways pricing in the Sarasota market and the state market at large have surpassed the realm of the rational.

The herd mentality has long played a large role in the investment world and financial markets. In late 2005, if you had not yet flipped a piece of investment property you were feeling quite ignorant and most likely cashed in all your chips to buy something. If you did buy in late 2005 for investment purposes, you are either now feeding a never ending mortgage or you are in foreclosure. I picked up on this when a bartender was telling me about his 5 investment properties. Consider the alternative- everyone is running from the market right now. People are giving property to the banks and bringing millions to the closing table just to get rid of their "investments." Irrationality creeps into the scenario when properties are selling for far less than they could be replaced or reconstructed for.

Sellers and Banks are literally waving the white flag of surrender in an irrational manner just to get out of the market. Many properties are going at 50 cents on the dollar or to the highest bidder. One recent example I witnessed is the sale of an estate on South Siesta Key. The heirs, not wanting to wait for a better time decided that their late father's open bay front estate with sailboat water should be sold immediately for just over $1MM. The property was listed at $1.9MM and then reduced to $1.5MM to procure an immediate sale. Consider Gulf Gate- touted as one of the best locations in Sarasota. A very nice home just sold in Gulf Gate for $145,000 which is closer to land value than the price a single family home should command in that area.

Markets are driven by the people that comprise them. As they gain momentum the herd mentality that Nietzsche so well characterizes often takes over and creates time periods in which human behavior contradicts reason. Those who are independent thinkers will fare well in these dark days for Florida real estate- I recommend watching the market closely. As I see it, there has never been a better time to be different.

Notes From The Trenches- What's Really Going On

2008-02-14T16:05:00.001-05:00

The most common question I am asked as a real estate practitioner is “What’s going on in the market?” In uncertain times like these many are wondering what exactly the real estate business looks like from a day to day point of view. Here are some snapshots from the last few weeks:

- I closed two deals in which the buyers came from Canada. The Canadians and Europeans are very active in our market and are driving many of the sales in my branch office of Michael Saunders and Company. Do not underestimate the impact of the foreigners who see this as an opportunity not to be passed up. In a recent conversation with a prominent Canadian I was told that he “could not afford not to” make his most recent purchase.

- I sold a listing in a multiple offer situation. I think that one of the biggest mistakes buyers are making right now is assuming that they are the only person looking at a particular property. The listing was simply a well-priced, well-kept home which was too good to pass up. I have been in multiple offer situations twice since the market changed.

- I am seeing activity related in large part to the passage of the controversial Amendment One which changes the taxation code in a way to positively impact the local real estate market. One of the buyers from the previous anecdote was spurred on to buy by the fact that his homestead exemption is now portable.

- Showings are up dramatically and open house traffic is significant. For all the negativity in the media, I think that the external indicators show that we are in for a brisk sales season.

A Postive Article in the Sarasota Herald Tribune?

2008-01-08T10:29:00.001-05:00

Have housing prices hit bottom?
Florida's best known economist says market in region has stabilized
By MICHAEL POLLICK
michael.pollick@heraldtribune.com

Florida's best known economist says the Sarasota-Manatee residential property market bottomed out in September-October and has now stabilized in both price and volume.

Hank Fishkind predicts flat prices for both counties through 2010, as the region chews through excess inventories of new houses and condominiums.His findings jibe with what some Southwest Florida real estate observers have been saying and with what statistics from the Florida Association of Realtors have shown during the final months of 2007.

In November, for example, Sarasota-Bradenton Realtors sold twice as many homes as their Miami counterparts. The median price in November -- the most recent sales reports available -- was $267,700, down 4 percent from a year earlier, but an improvement from $244,300 in September and $263,900 in October.

Fishkind made his own predictions for this region as part of a 33-county economic report prepared on behalf of Attorney's Title Insurance Fund Inc., a leading title insurance underwriter.

His report painted Miami-Dade and Lee County as the state's most problematic areas, because of excessive condo building in South Florida and a proportionately higher level of home building during the boom in Fort Myers.

Orlando has the strongest market in Florida, followed by the Tampa Bay area and Interstate 4 corridor, Fishkind said."But both Manatee County and Sarasota County are still in considerably better shape than many other areas," he said.

Fishkind said that Charlotte County continues to shake off some of the vestiges of 2004's Hurricane Charley, but that the market is in far better shape than its neighbors to the south, where speculation on investment properties was rampant during the housing run-up.

"We are starting to see more normal activity," Fishkind said. "I am much more concerned about Lee County than I am about Punta Gorda."

Fishkind projects moderate rates of growth for population and employment in Manatee and Sarasota counties between now and 2010.

"In regard to housing growth and starts, speculative investing in the real estate market occurred in the area between 2003 and 2006 and resulted in an excessive amount of new homes in both markets," Fishkind said in his report. "

This is expected to temporarily slow down the area's housing markets in the next few years, and result in household growth exceeding housing starts in both counties in the next several years. A recovery in housing starts for both counties, however, is expected to begin in 2008," he wrote.

The Sarasota market appeared to bottom out in the spring at 470 to 480 closings per month. But then a national liquidity crisis sprang to life in August, prompted by defaults on subprime mortgages issued during the feverish markets of 2003-05 and continuing into 2006.

For a month or so, mortgage makers froze. As a result, sales fell to 310 in September and stayed flat at 319 in October.

"It seems to me that is the new bottom," Fishkind said, referring to sales in more recent months. "So I'm not seeing any major price declines, and I think volume has stabilized.

"Fishkind looked at average prices for all closed residential sales in both counties, taking into account for-sale-by-owner deals as well as builder sales.

In Sarasota, the average price for existing homes in Sarasota during 2007 was $330,042, a 12 percent drop from the peak of $374,107 in 2006, Fishkind reported.

In Manatee County, the decline in average prices has been more severe, coming down 24 percent to $280,622 in 2007 from a peak $370,200 in 2006.

The economist's forecast is predicated on the assumption that the national economy, while definitely in slow motion, will narrowly avert a full-blown recession.

"We have had a significant slowing to basically zero growth in the fourth quarter," he said. "The U.S. economy isn't going to start improving until the second half of '08 and into 2009.

"That national assumption is critically important because Florida depends on the Midwest and Northeast United States for a supply of residential real estate buyers, Fishkind acknowledged.

When they suffer, Southwest Florida suffers, too, on a lagging basis, he said.

"Almost everybody who moves to Florida in 2008 made a decision to move in 2007," Fishkind said. Because of that national slowdown, "we will see Florida's economy slowing in 2008 and not improving until 2009.

"Other economists have a more pessimistic view, leading to predictions for a more drawn-out recovery for Florida. But Fishkind maintains that the Sunshine State's historical drivers will lift it above other states in the Southeast.

"Florida tends to generate more jobs and population growth than any other state in the Southeastern United States, so turnaround for some parts of Florida ... will take place ahead of many other states in the Southeast," Fishkind said in a statement."Other parts of Florida, namely Miami-Dade County and Fort Myers, will not recover until later."

Foriegn Buyers Ice the Cake this Holiday Season

2007-12-13T16:05:00.000-05:00

In an era when the media seems to relish in continuing to deplete consumer confidence, it is refreshing to see some bright spots starting to surface in the Sarasota real estate market. Michael Saunders and Company has continually charted and shown the resilience of the Sarasota market over against the rest of the state. One of the largest factors contributing to the trend of stabilization in our local market is foreign buyers. My personal experiences over the last months have led me to encounter two sets of buyers from Canada. Both groups of wonderful people, these Canadians share one key aspect in common: they have more confidence in our market and our economy than we do!

As the media and other pundits continue to decry the woes of the dollar and the housing market it is encouraging to me to see buyers from several foreign destinations begin to take a stake in our market. Foreign nationals make for some of the most motivated buyers in the market right now. They seem to believe in the market more than most local residents do and they want to take advantage of the favorable exchange rates and pricing that might not always be there. It would serve Sarasotans well as a community not to forget our seasonal visitors from the north and from foreign lands- they just might be the catalyst that starts what will be an interesting and long road to full market recovery.

Venice Amongst Best Places to Retire

2007-10-22T10:50:00.001-04:00

Here is a great article from the Sarasota Herald (for a change...)

So what makes Venice a great place for retirees?
Locals agree with magazine that the city is a great place to retire
By PATRICK WHITTLE

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VENICE -- Lucille Steen was not surprised when she saw an article in a national magazine declaring Venice a great place to retire.After all, the city did not attain a median age of 68.8 by accident."No, not surprised at all," said Steen, who moved here from Connecticut. "When we decided eight years ago to retire, we looked up and down the west coast. We chose here."Still, U.S. News & World Report used its first-ever "Best Places to Retire" issue to tell the world something Venetians have known for years.The magazine thought highly enough of Venice to include the city on a top 10 list that also includes San Francisco, Calif., and Prescott, Ariz., but no other Florida cities.Managing editor Tim Smart said the magazine based its list of cities, which were not ranked, on a range of quality-of-life issues including "weather, crime, proximity to health care and relative cost of living." Award-winning beaches and golf did not hurt, said the magazine's Web site.That is all well and good, but locals such as Steen point to a number of slightly more folksy amenities that make them glad they chose Venice.Secret beachesTourist brochures scream about the shark teeth at Venice Beach, but locals point to the more obscure South Venice Beach, which is only accessible by ferry, as a favorite. Secluded Caspersen Beach, the longest strip of sand in the county, is another favorite."That's one of the reasons we bought in this area," said Steen of South Venice Beach.Cockpit CafeFrom the outside, the little restaurant by the Venice Airport runways does not look like much. But inside, Chef Jarda Hornacek serves up homemade soups and sandwiches.The Cockpit is a favorite place for retirees, and everyone else, to watch planes take off and land. Locals also swear by the Cuban sandwich, which Herald-Tribune readers voted the best in the county.Dolphins at the jetties at sunsetWhen the water scooters and Boston Whalers finally putter out for the night, the Gulf of Mexico's marine mammals take the stage at the North and South Jetty. Crowds of more than 50 people have been known to gather to catch the sunset and scan the surf for bottlenose dolphins."The accessibility of the beaches and the accessibility of the nature ... are reasons we moved here," said Steen.The joy of navigating endless road constructionWhile not exactly a labor of love, driving around the seemingly unending road construction north of the island is a favorite gripe of Venice retirees, and it is an instant conversation starter. Tamiami Trail was also the site of a long construction project in 2003 and 2004."They kill me with the road. How can anybody get in and out?" said Steve Fotos, former owner of Ntino's Restaurant in Venice, in 2004.U.S. News & World Report released the retirement issue on Sept. 24 and launched a Web site at www.usnews.com/usnews/biztech/best-places-to-retire.U.S. News sent reporters all over the country after narrowing down a list of 2,000 candidates, said Smart, the magazine editor.Venice stood out, he said."The small-town feel of Venice -- the writer came back with that," Smart said. "The overwhelming atmosphere is that of a traditional Old Florida feel."Steen could have told him that years ago."We really looked on the west coast, up and down. We decided on Venice," she said.

Great Article- 10 Reasons to Buy

2007-10-16T11:31:00.000-04:00

I found this article online and thought it was a good one. It is by Paul Pastore.

10 Great Reasons to Buy:

Selection, selection, selection. There are about 57,000 resale homes on the market in Maricopa county(Phoenix). Regardless of the price range a buyer desires, there are plenty of houses from which to choose. Just a few years ago the resale inventory dropped below 5,000 units. A buyer was forced to make compromises if they were going to locate the home of their dreams. There is a great selection of attached homes, condos, and townhouses. You can find large lots, small lots, and a lot that will accommodate your boat or RV. There are lots of options in this market.

No Bidding Wars. In 2005 we had one client that made an offer on ten homes. They lost the first nine to the 'feeding frenzy' that existed. Other buyers bid the properties up substantially from the original listing price. There were escalation clauses where buyers authorized their agents to outbid other offers by thousands of dollars. There is no competitive bidding in this buyer's market.

You can make an offer. A few years ago when you made an offer, the only question was how high above the list price could the buyer reach in hopes of being the best offer on the table. Today the sell price list vs. price ration is about 96%. A seller will not be insulted if you 'make them an offer they can't refuse'.

Patience is tolerated. In the hot seller's market that existed everything was rushed. Find a house before other buyers did. Hurry up and make the offer. Today a buyer can take their time. Look at several homes and think about your decision for a few hours.

Due diligence is welcomed. In this market a buyer is encouraged to obtain a home inspection, termite inspection, and appraisal. In 2005 many buyers waived these contingencies in order gain an advantage with multiple offers.

There are plenty of specs. In the not too distant past buyer had to 'play games' if they wanted a new home. There were lotteries and waiting lists in order to obtain new construction. Some buyers slept in their cars in order to get to the head of the lines. R.L. Brown estimates that builders have thousands of specs ready for immediate occupancy.

Repair requests are welcomed. After a buyer completes a home inspection, they are allowed to submit a repair request to the seller. In the past a seller might insist the home was sold 'as is'. Many times, there were back-up buyers waiting for a primary buyer to upset the seller whose home was increasing in value almost daily.

Few, if any investors. It is estimated that one third of all sales in 2005 were to investors. These non-owner occupied buyer caused the market to inflate and affordability to decline. Mortgage fraud became commonplace. It's a great time to buy without having to compete with hundreds of prospective landlords.

Location, location, location. Today's buyers can find homes closer to work. In the past buyers flocked to Maricopa and Queen Creek in order to find affordable homes. In this market, reasonably priced homes are within biking or walking distance to schools, rapid transit lines, and relatives.

Real Financing is available. The 'wink, wink' zero down, no doc, adjustable, sub-prime loans are gone. Fixed rates are back. FHA financing, first time homeowner bond programs, special loans for teachers, and police officers are back in business. It's a great time to buy real estate!

Michael Saunders on the Real Estate Market

2007-09-18T12:25:00.000-04:00

Michael Saunders has been an innovater in the local real estate market for 30 years. No one knows the ins and outs of the market better than she does. I thought that I would post a link to a recent Sarasota Herald Tribune interview featuring her. I would recommend taking an opporunity to listen to her perspective. The interview is in pocast form and can be listened to using this link:

http://www.heraldtribune.com/article/20070912/PODCAST0701/70911027/1201/REALESTATE

Market Update

2007-08-31T14:14:00.000-04:00

As I run into my colleagues, friends and family, I am constantly being asked the same question: “Drew, what’s the latest on the real estate market?” Hopefully I can provide some insight into the latest trends in the market for you in the limited space I have for this column. I think that the most prominent contour of our market right now is how much the face of residential lending has changed in a very short period of time. We are seeing ripple effects of tightened lending standards at all price points of the residential market. While I have been seeing 30 year fixed rate loans as low as 6.125%, jumbo loans (loans over $417,000) have become very unattractive to lenders and are subject to much higher interest rates. While this is painful trend for sellers, I see this tightening of credit as something that will be good for the long term health of our market.

Why This is a Good Thing: To be perfectly candid, a lot folks I have come across in the last few months are having problems with affording properties that they should never have bought in the first place. Lenders are really scrutinizing would-be borrowers to make sure that they can repay mortgages. For well qualified borrowers financing is still easy to come by while those who are over-leveraged will not be able obtain mortgages- especially on investment property. This new level of scrutiny by lenders will ultimately be a large part of the solution to our volatile real estate market. What we need is confidence by consumers. This will eventually be a natural byproduct of lessened speculation and unqualified purchasers. Deals closed with the help of conventional financing will become more and more solid as qualified buyers (mostly end-users) will begin to absorb well priced inventory and bring more stability to our market overall. I see our residential market as on the road to recovery. There are still plenty of people out there who need to buy and sell, which is why when people ask me how my practice is going, I can honestly respond, “Better than ever!”

On Auctions...

2007-04-23T15:49:00.000-04:00

Auctions have come to the forefront of the real estate market as a viable means of liquidating properties that just will not sell under the traditional brokerage model. With surging inventories and diminished sale prices, many are under the perception that the best way to induce a quick sale is sign with one of the companies who is offering auction services. Based on my study of several local auction companies (whose function in the market I highly respect) I am going to explain how the process works. I believe that the process has a value to it, but is not appropriate for all the sellers who have chosen this path as of late. While many of the local brokerages are sponsoring this new way of moving homes, I am not convinced that an auction has a true benefit to sellers at all. Michael Saunders and Company continues to operate under the philosophy that a well-priced and professionally marketed property will always sell- and often at a higher than auction price.

The auction process often starts with the seller being to referred to an auction company by his or her listing agent. For this referral, the agent will be paid a commission in conjunction with the successful sale at auction. An up-front marketing fee is paid to the auction company- this is often over $10,000. Before the auction begins the auction company and the listing broker establish an aggressive marketing plan to create a buzz about the property to be sold. During this time, several prospects are driven to the property and in some instances the listing agent is able to procure a sale without going to auction, but the seller still has paid up front costs out of pocket. If the property does make it to auction, the best way to sell the property is absolute (a term which apparently has many meanings). An absolute auction means that the property will go at any price, although several stipulations can apply to this such as an approval from the lender if the property is a mortgage short sale. If the property does reach a successful sale at auction almost all the auction companies charge a 10% buyer’s premium on top of the sale price. So buyers are always mindful of this and offering 10% less than what they are willing to pay. Those percentage points start to get awfully big very quickly. Out of the 10% premium, the listing broker gets 3% for the referral and the auction company keeps the rest (If anyone reading this thinks the process work differently, please enlighten me at drewrussell@michaelsaunders.com)

So to recap, an auction seems like the worst way to sell a home unless you are absolutely in immediate distress. In addition to the normal closing costs such as prorated taxes, doc stamps, title fees etc., the seller forks out a large sum of money up front. At Michael Saunders and Company, most of our agreements are structured so that we are paid on a contingent fee basis, meaning we are paid to perform. After this money is gone from the seller’s pocket, bidders come to see how low they get the price, ever mindful of the painful buyer’s premium, closing costs, loan origination fees etc. etc. The end result is much more money being spent to procure the property transfer at a huge disadvantage to both parties involved. The traditional brokerage model works and compensates real estate professionals fairly for their work. As a seller, consider speaking with your agent seriously about a price reduction before you go to auction. Do you believe enough in the marketability of your property to stroke a check to the auctioneer? If not, get real and give your agent a price reduction. Undercut the market and create a buzz and frenzy. My bet is that in a private sale, assisted by a qualified broker, both parties will come out ahead while maintaining a bit more peace of mind.

New Market Stats- Local Market and Palmer Ranch

2007-04-04T14:14:00.000-04:00

There is slightly better news in the latest statisitcs that I have pulled from the Sarasota MLS. In terms of single family homes in the Sarasota market, total sales have increased slightly as did the inventory. Based on February 2007, which is the last month of data availible, we have a 32 month inventory of homes available. The most promising trend is the increase in homes put under contract which has climbed steadily over the past 3 months which will very likely reduce some of our lingering inventory. In December 151 homes were put under contract. This number rose to 224 in January and climbed to 266 in February. These numbers seem to be indicative of the larger trend that I am seeing which shows stabilizing market (at least prices are falling more slowly now.)

In Palmer Ranch, single family home sales accomplished an amazing feat- 31 homes were put under contract- a number higher than anytime in the past 14 months. (I was able to account for two of these sales). Inventory remains at an all time high of 35 months. Sales are picking up due to ever falling prices of properties- most homes in Palmer Ranch are now selling in the mid to high $100's per square foot. In February, the average time on the market for a house that sold was 124 days, and most homes sold within 93% of the listing price. The average house sold for $397,000 while the average listing was priced at$573,000.

The strength of the condominium market was actually fairly similar- less condos were put under contract (14), but this was a huge increase from only 4 in the prior month. There is a 31 month inventory of condominiums for sale in the area, and the average sold condo sells in 90 days at 93% of the list price. The average sold condo in Palmer Ranch had a final price of $251,000.

For information and statistics on your neighborhood, be sure to email me at drewrussell@michaelsaunders.com.

Snow and Taxes

2007-02-26T11:03:00.000-05:00

I managed to escape our Sarasota winter climate for one much further West- and one much colder- for a week on a snowboarding vacation. Amidst the dryness and abundant snow, I was amazed to find similarities in real estate trends between Sarasota, Florida and Vail, Colorado. I am amazed at the prices in Vail Valley. It is not the fact that a massive snow chalet can set you back about $12MM, but the fact that what the buildings are made out of is so much cheaper than Florida building materials. The land is the key as in all real estate deals and location is king. From what I learned in Vail, the luxury market is surging much like it is in Sarasota. Record prices are being set everywhere, with extreme buying confidence being found in the elite.

I am also receiving lots of calls and questions in regards to recent series of newspaper articles regarding a change in tax law in the state of Florida. For those who have not heard, a proposition is on the table that would eliminate property taxes for homesteaded property and raise consumer sales to 8.5%. The tax rate on vacation homes and commercial property would also receive a break to the tune of around 18%. There are many ramifications of this potential legislation, but as a homeowner and Realtor, I can see a large upside. Stay tuned to government news sources as this very exciting and controversial discussion continues.

On My Soap Box Again

2007-02-05T14:26:00.000-05:00

This is a familiar stumping topic for me, but I am again amazed at the confidence that I am seeing in the upper end of our market. Just last week, our company participated in two record sales: A closing for over $7 MM in Harbor Acres and a closing for over $6MM in Cherokee Park. We are continually seeing a pattern of the wealthy making bold investments in this market. Now that the stock market is hot everyone is talking about their investments in similar fashion to how everyone was talking about their real estate holdings a year and a half ago. Be different and be smart. Now is one of the best times to buy and hold in the Sarasota market.

Some More Market Data For Number Crunchers

2007-01-23T11:25:00.000-05:00

We are seeing an up-tick in sales activity both locally and nationally. Take it with a grain of salt though- inventory levels are still high, and there are plenty of investors out there with ARM’s or negative amortization loans that will be adjusting payments soon. I expect to continue seeing higher than normal amounts of property coming on the market though prices seem to have somewhat stabilized. On a national level, the number of homes that were pended slipped a bit statistically- about .5%. This number is actually encouraging considering the departure from the double digit decreases around this time last year (Source NAR). In Florida, a total of 11,912 homes sold in November of 2006 (the most recent month of completed statistics) while 17,088 homes sold in November of 2005. This is a decrease in volume of roughly 30%, and at the same time median sales prices slipped 3% to $242,500. David Lareah, chief economist for NAR predicts that this period of price adjustment is nearing its conclusion and that all markets will feel a lift in consumer confidence and sales in the first quarter of 2007 (Source FAR). The Sarasota market’s individual numbers were up for the first time in a while, with the November sales mark of 294 homes besting October’s numbers by 9.6%. In these sales the median was up about 3% to $315,000 (Source SAR). We are still in a tough market, but indicators show that more sales are occurring and the consumer confidence is rising. Most forecasters look for this to be the 3rd best year on the books, with activity returning to 2001-2003 or comparable levels.

A Glint of Hope in Recent Stats

2007-01-10T11:11:00.000-05:00

For the most recent MLS sales data, most numbers continued to show a negative trend for real estate values and market strength overall. These numbers are comparing December of 2005 with December of 2006. The average sales price for a residential dwelling was down 10% with $567,412 being the average for 2005 and $510,848 being the average for 2006. Active listings went up 29%, number of sales was down 20%, expired listings were up 279%, but the promising figure for me is that the total number of listings taken was down 45% for the residential market. So we must be getting to the end of some of this inventory- it is not being created as quickly as developers are losing confidence and inventories are starting to get absorbed. The condominium market was down in listings by 40% as well showing that with less coming onto the market there may be an end in sight to this lopsided market.

What's On Tap for 2007- Sarasota Markets

2007-01-08T11:28:00.000-05:00

To my readers I must apologize for the gap between my last posting and now- I have been working on updating www.drewrussell.com to serve my clients better and took a break from posting blogs. For my first blog of the new year, I thought I would answer the question that virtually all of my clients are asking me- and that is "where do you see the market going in 2007?"

My prediction is that 2007 will feel vaguely like 2006 except without the bleak Winter-Spring the real estate industry saw last year. The first three months of last year were so quiet that most everyone was scared of what was in store. We are on the other side of that now, and from what I can see prices are beginning to stabilize and buyers are making moves on the properties that they had been waiting for. Couple that with low rates- my last closings featured rates at 5.875%- and I see absorption increasing in the coming months. It will take us a good long while to get out of this funk, but better times are ahead in a more equalized market. 2006 was still a great year to do business. My personal sales volume was higher than 2005, and I was able to find many clients great deals on the buying side. The listing side was a bit more challenging, but many sellers who were savvy took my advice on pricing and still made large profits.

On a bit more sour note, I did serve some investors who got some bad advice from other sources and ended up losing a lot of money. That was tough to be a part of, but as amateur investors are getting flushed out of this market, so are those are wanting to sell and move back up north. Another factor that is going to affect this market greatly is the segment of sellers who are looking to make in town moves. As soon as their houses sell, they will be out hunting for new homes as well. As this market starts to slowly gain momentum, I think everyone will be surprised at the speed of the rebound- especially in unique residential sections. This does not apply as much to cookie cutter developments and condos overwrought with irrational investors.

For those of you who like cold hard numbers with your highly speculative real estate forecasts, consider some of these. In late December the Main Street Office of my company had a $20 million dollar day- that's right- $20 million in about 6 contacts- all high end sales. For the year of 2006- the worst year in several- 397 properties closed escrow for over $2 million. This shows me that there is confidence at the top of the market- and regardless of how you feel about trickle down economics on a macro scale, I do think we are going to see this confidence trickle down and help revive a weak market.

That's the update for now- be sure to email your comments to drewrussell@michaelsaunders.com.

Finally A Decent Piece of Journalism

2006-10-19T16:06:00.000-04:00

Most of you who subscribe to our local newspaper have probably had it with negative real estate reporting in the news. I know I have- so Kenneth Hearney's article in last Sunday's paper was a welcome moderate voice, even if we did have to rely on the AP for some good reporting. The article concludes by stating that a lot of the recent news media rhetoric has been superfluous and severe. Hearney's conclusion is that this faulty rhetoric, while terribly effective at selling papers, really cripples the market in the long term. I share this sentiment with him.

People always ask me where I see the market going... so here goes.

The U.S. economy is in an interesting position- the Dow is hitting record highs, unemployment is low, oil prices are down, and the long term interest rates have slowly been falling each week. Also the luxury housing market is very strong. All of these externals lead me to believe that serious buyers and sellers don't need to sweat the larger forces of the economy. Although we are in a correcting market I think we are seeing greedy and frivolous investors get what was coming to them. These are the true horror stories- otherwise I think things are getting back to normal. Normal means that the drastic 30-40% run up in prices is easing back to the normal patterns of what prices would have increased to incrementally without the boom. The day to day vicissitudes of being a real estate practicioner model to me more of a correction than a bust.

More Growth for Lakewood Ranch

2006-10-05T16:09:00.000-04:00

Despite the slowing real estate market Lake wood Ranch is planning for more massive future growth. I was astonished to learn that SMR is planning to add over 8,000 more homes north of State Route 70 in South Bradenton. In an effort to make Lakewood Ranch a more autonomous community the focus will be on growth not only in residential units, but also in commercial and industrial sectors as well. Although building is not supposed to start until next year, and build out wont be until 2019, this news is a bit surprising since much of Lakewood Ranch is for sale right now. This shows us that big developers are still buying into the long term viability of the Sarasota Real Estate Market. One thing that you can bet on about this new development is that much of it will be "affordable" in comparison to other Lakewood Ranch areas. For those who enjoy the Lakewood Ranch lifestyle, now is a great time to buy. A source at Neal Communities told me about a new community in the Country Club that is starting in the $380's- a very modest price for the luxury that lies behind the gates.

Negotiating Tips- Be Courteous and Get More

2006-09-28T15:16:00.000-04:00

I had a past customer of mine call the other night. She was in a panic and trying to negotiate a real estate deal that she and her agent were working on up north. In most parts of the country we are dealing with a much different market than a year ago and people who bought and sold in the boom are now finding a new paradigm coming into play when negotiating in a tougher market. Her dilemma was complex- she was a seller trying to muddle through the details of a very bad offer with many contingencies and complexities clouding what even the final sale would net my past customer.

I have another acquaintance who is working with an agent and is trying to buy a house in Sarasota. His agent is helping him write several insulting offers a week which are being met with mixed levels of resentment, rage, or indifference.

Both of these scenarios highlight a negotiation technique that is rooted in both common sense and decency: Focus on one goal in your offer. Sellers are feeling the heat of this market and will more often bite on a clearly written offer with a lower price than one with all sorts of confusing contingencies and negative clauses for the seller. Try not to insult already suffering sellers and put together a good offer with realistic terms and really go for it on the one front your are trying to gain ground on. Usually it all revolves around the lowest price so make sure that price is in the range of reality and go for it- but show the seller you are a solid buyer by offering solid terms and as few contingencies as possible. I have seen this technique be successful for both buyers and sellers as it eliminates the confusion of a messy offer.

Let's Go Buy Some New Construction

2006-07-11T12:43:00.001-04:00

Well, builders seem to be sucking wind this season. Before I can get any real work done each day, I have go through and delete all the builder incentive emails that I am getting. While I do appreciate the sales incentives, the true advantage lies with the buyer. A year ago, you were lucky to get on a waiting list. Today, you can walk in and buy and inventory home at a greatly reduced price with many upgrades at "no charge." If you are condsidering the purchase of a resale home, you might be better off looking in the same area for something new. You will most likely be surprised at what you can get. Give me call or shoot me an email for some ideas. Mail to: drewrussell@michaelsaunders.com.

More Palmer Ranch Statistics

2006-05-11T12:09:00.000-04:00

Well, there's always good news and bad news- and they usually come together. The GREAT news that as a whole, the MLS pended sales for last month were 430, a level equal to last January when the market was totally different. That is a great sign of the vibrance of our market. While we are seeing the same level of buyer activity, listings are taking a great deal of time to sell with over 4 times the inventory of last year!

Here are some more comparative stats, and the essence remains the same: While sale prices are up, so are listings. Total sales are down for the year despite recent signs of a healthy resurgence.

These stats are comparative for 1/1 to 4/31 for 2005 vs 2006.

Palmer Ranch Single Family Homes

Total Number of Listings Taken: 2005: 175 2006: 327 Up 87%
Total Number of Sales: 2005: 138 2006: 81 Down 41%
Median Sales Price: 2005: $416,750 2006: $499,900 Up 20%

Palmer Ranch Condominiums

Total Number of Listings Taken: 2005: 146 2006: 259 Up 77% (flippers beware)
Total Number of Sales: 2005:100 2006: 62 Down 38%
Median Sales Price: 2005: $272,775 2006: $282,500 Up 2%

Another Outstanding Siesta Key Property

2006-05-09T17:22:00.000-04:00

I just listed a very interesting and historic Ruth Richmond home on Siesta Key. This home was built in 1971, and has been relatively untouched by its original owner. It is a three bedroom, two and a half bathroom home located on a Siesta Key Canal. On over a third of an acre, this home could be torn down, or would be perfect for restoration. Only one bridge separates the owner from the Bay. The property is being offered at $999,000 and for more information, shoot me an email.

Palmer Ranch Market- First Quarter '05 vs. '06

2006-04-04T10:40:00.000-04:00

Here are the Palmer Ranch statistics as a comparison point between the first quarters of 2005 and 2006:

Residential Single Family Homes

Total Listings Taken : 2005- 143, 2006- 257 Up 80%
Total Number of Sales: 2005- 100, 2006-62 Down 38%
Mediam Sales Price: 2005- $415,250 2006- $502,500 Up 21%

Condominiums

Total Listings Taken: 2005- 96, 2006- 205 Up 114%
Total Number of Sales: 2005- 71, 2006- 42 Down 41%
Median Sales Price: 2005- $275,550, 2006 $282,500 Up 3%

Summary: Its a great time to be a buyer as we continue to see inventory accumulate. Its an unbelievable sitaution for buyers as sellers are seriously looking at all offers. In the condo sector, opportunity abounds as modest appreciation rates and improved condos are reselling for a modest investment return.

Outstanding Siesta Key Opportunity

2006-04-03T10:54:00.000-04:00

I went out to eat last night at one of my favorite local restaurants, and was amazed at how many out of state license plates were clogging up the parking lot. Never in my life have I seen Sarasota this crowded with the influx of tourists. Siesta Key is bustling with life, which leads me to my point. I have just listed an outstanding 6th floor condominium in Harbor Towers which offers great investment potential. In peak season the rent will gross the owner over $4000.00 monthly. While cashflow properties on the Key are all but extinct, this unit is being remodeled and offers a way to invest in waterfront real estate in Sarasota with a nice opportunity to recoup out of pocket expenses. Send me an email to learn more.

Sarasota's Luxury Market

2006-03-27T10:12:00.000-05:00

For months now I have been telling people that the high-end market in Sarasota is going to be less susceptible to the impending "correction" than other market sectors. The investors that I have had the pleasure of working with over the past year will tell that I always counseled them to avoid multiple "small" deals and pursue the market segment above the million dollar mark. The reasoning behind that is simple- every mom and pop operation in Sarasota and from everywhere else it seems invested in condos and lower end homes to flip. Speculation in the high end market is also fierce, but by virtue of the numbers, there are simply fewer players on the investment side. In a market where sales are slowing, I have long seen and forecasted that our luxury market would not feel as much of a correction as other market segments. No one can argue that inventory in the luxury sector is up greatly over last year, but what is impressive is that benchmark sales are occurring with some regularity.

Take for example these recent sales:
A home sold this week on Westway Drive on Lido Key set a regional record for a sale of a home on a single parcel- the home sold for $13.1 million dollars and both sides of the deal were handled by my firm, Michael Saunders and Company. Our office also has a very dominant presence on Casey Key which has been the subject of many discussions about the vibrance of the local real estate market. A deal recently went pending in my office for the sale of a Casey Estate that has a list price of 10.5 million dollars. There are currently 20 pending sales of properties valued from $3 million to $14 million in the Sarasota MLS, a bold statistic in a faltering market.

There are many reasons for this, but one is that buyers from markets like California and Naples are realizing the opportunity that Sarasota provides- and that luxury estates here are still priced fairly well- especially in a "buyer's market."

What's up with Zillow.com?

2006-02-28T11:25:00.000-05:00

When my grandmother called me to tell me about a real estate website, I almost had a heart attack. This is my generation- the generation of technology... despite the shock, I checked the site out and think it is a pretty cool concept- one I surely wish I had come up with. It seems that some wonder if real estate agents see Zillow as an impediment or competition to our jobs. Questions the Sarasota Herald has been asking seem to indicate this.

Zillow is good in moderation, but what people have to realize is that it is a new site, and that the comparable sales are generated and picked by computer. I tried about 10 properties out and found Zillow to be a good bit off. To its credit, it was right on two parcels. Before you try to sell your based on the figure Zillow spits out, consider a few things:

1. Computers do not have nuances programmed in. Is your house on a corner lot? Does is have granite countertops? You get my drift.
2. Everyone in any given neighborhood know the general prices homes have been going for. Zeroing in on the exact dollar amount is more tricky.
3. Some of the comps Zillow found for me were months old. For instance I bought my home over two months ago and it was not updated. The market looks much different today than it did months ago.

My advice: Zillow in moderation- and consult an agent or appraiser if you want a more accurate price.

Palmer Ranch Market Update First Quarter 2006

2006-02-28T11:11:00.000-05:00

Despite the external signs of the shift to a drastic sellers market, home and condo values are still on the rise in the Sarasota market in 2006. How ever, there is over 15 months of condominium inventory in the Palmer Ranch Market. Transactions are slowing, but market prices are maintaining their robustness with a very strong upward surge in Palmer Ranch home values- to the tune of 34%!

Here are the statistics:

Residential 2006 2005 Change
# of Listings Taken 161 80 Up 101%
# of Sales 28 54 Down 41%
Median Sales Price $557,500 $432, 500 Up 34%

Condominium
# of Listings Taken 156 60 Up 160%
# of Sales 18 35 Down 49%
Median Sales Price $284,950 $270,000 Up 6%

Even in a shifting market home ownership seems to pay a lot better than the bank. A word of advice to sellers. BE REALISTIC. Take a look up and down the street. If you see multiple For Sale signs, the market is competitive. Ask yourself what is that will sell your home. The answer is value. Buyers determine value by comparison shopping. Make sure your house stands out and priced well per square foot. No matter how much you advertise, if your house is overpriced, it will not sell. If you are wondering what your home is worth and how to get it to sell more quickly, give me a call or email me: drew@srqlife.com.

City Place at Pineapple Square- Sure to be a Good Bet

2006-02-16T11:04:00.000-05:00

As one who did his undergraduate work in Palm Beach, I feel that I can speak with authority about the City Place concept- after all I spent a lot of my time there- eating at Cheesecake Factory, visiting at Starbucks, or studying at Borders. One of my former professors bought a condo at City Place in West Palm Beach and has seen tremendous appreciation on his purchase. I am excited about Sarasota getting a City Place for many reasons- and I think that Sarasota's version may even be more luxurious due to its proximity to the water. City Place will have condominium residences located convenient to the arts, entertainment, fine dining, and high-end retail. Preconstruction pricing is available now from the $400's to the $900's. Shoot me an email to drew@srqlife.com for more information on this up and coming Sarasota hotspot.

Downtown Skyline to Continue Significant Changes

2006-01-23T10:07:00.000-05:00

Despite gloom and doom forecasts by some of the regions leading economists, some downtown Sarasota developers continue to see the silver lining of the local luxury market. Two more buildings will be added to the frequently changing Sarasota skyline- The Grande Sarasotan and The Marquee on the Bay. Both buildings are going to be centered on larger and fewer units and gunning to fetch over $3 Million for each unit. Both buildings, located in close proximity to Sarasota Bay will offer great views and will focus on the luxury niche. My appreciation for the diversity and luxury of Sarasota's downtown area continues to grow. With areas like Golden Gate Point and buildings like these, Sarasota will continue to become more and more of a Florida Landmark. For more information about these exclusive residences, or what's going on downtown, shoot me an email- drew@srqlife.com.

Palmer Ranch Market Update

2006-01-18T08:42:00.000-05:00

Palmer Ranch has always been an outstanding place to call home in Sarasota. Its county club feel, combined with close proximity to beaches and shopping make it a prime place to live. The Palmer Ranch market continues to show signs of robustness, especially in the single family home arena. So for those who want to know, here are some 2005 Palmer Ranch comparative stats:

Single Family Homes:

March 2005-
New Listings: 60 Sales: 43 Average Sale Price: $475,418 Average List Price: $521,163 Average Days on the Market: 69

September 2005
New Listings: 53 Sales: 31 Average Sale Price: $564,337 Average List Price: $655,656 Average Days on the Market: 74

December 2005
New Listings: 41 Sales: 22 Average Sales Price: $653,789 Average List Price: $602,245 Average Days on the Market: 115

Summary: Although the listing inventory is accumulating, sale prices show strong growth resulting in almost $175,000 in average sale price growth in the last nine months.

Condominiums: (A Different Story)

March 2005
New Listings: 34 Sales: 34 Average Sale Price: $297,933 Average List Price: $284,244 Average Days on the Market: 136

September 2005
New Listings: 46 Sales: 31 Average Sale Price: $281,144 Average List Price: $281,144 Average Days on the Market: 197

December 2005
New Listings: 44 Sales: 17 Average Sale Price: $299,163 Average List Price: $304,595 Average Days on the Market: 86

Summary: What the data shows is a more stagnant condo market but this data is skewed due to over speculated condo projects in the area such as Arielle and the Serenade. There are very nice condos showing consistent stable growth in places like Prestancia and Stoneybrook. Shoot me an email with any questions.

I Agree

2006-01-11T15:18:00.000-05:00

RISMEDIA, Jan. 11 — The key word for the housing market in 2006 is balance, with a return to a more normal rate of price growth, according to the National Association of Realtors®. David Lereah, NAR's chief economist, said current trends in the housing sector are healthy. "We don't need to break a record every year for the housing market to be good – in fact, cooling sales are necessary for the long-term health of this vital sector," Lereah said. "A modest slowdown in home sales, coupled with improvements in housing inventory, means the market is in the process of normalization. That will help to bring balance between home buyers and sellers, yet sales will remain historically strong."

What's Really Going On?

2006-01-11T11:50:00.000-05:00

I wish a Happy New Year to the followers of my blog and apologize for the brief respite from publishing my opinions. You might notice a newer look to the website, and note that I striving to make drewrussell.com a more comprehensive and relevant Sarasota real estate information source. The holidays were good this year for most Sarasota investors who tried their luck in the market and sold in 2005. Many investors who bought lower end condo conversion properties in mid to late 2005 are now sitting nervously waiting for the next mortgage bill to come OR a phone call with good news from their agent.

My volume of seller phone calls has increased as of late and I am enjoying working with savvy sellers who realize that the market is not crashing. The key to selling a property right now is staying within the realm of comparable sales and not being greedy. I can attest from multiple sources that the market is picking back up, but with more picky buyers and "value" priced homes. I am constantly barraged with emails from agents and sellers offering ludicrous agent bonuses and buyer rebates on their overpriced homes. If you are thinking about selling be realistic and consult an agent you trust for an accurate opinion of value. If you are buying, now is a great time to buy. Look for discounts off of list prices, but be sure to understand the value of the market is not going to crash- so be fair.

Investors have the most to consider right now. And I will return to my stump and counsel them to focus on uniqueness. Absolutely do not buy a cookie-cutter condo on speculation right now. Most developers are fetching market price and the easy flip now becoming as elusive as the perfect NFL season.... More to come, and thanks for reading!

Upcoming Communities- The Lake Club at Lakewood Ranch

2005-10-17T14:27:00.000-04:00

I recently took a bike ride with my wife through the Lakewood Ranch Country Club. It was the early evening and the scenery was absolutely stunning. I was amazed at the tranquility and quiet luxury of the whole setting. With prices in the gates of the Country Club spiking 40% in the past year, I am interested in the demand for other East County luxury communities. With the Concession going in and already being built, (homes in Nicklaus Manor start around $2.2 Million) and the Lake Club getting under way, this is sure to be a hotspot for many years to come. Sarasota continues to see high demand for a luxury product without the insanely high dollars per square foot of the barrier islands.

The Lake Club will be a new luxury enclave with over 700 homes and 300 carriage homes and condos. Set in a similar setting to the Country Club, the Lake Club will be luxe community with golf and all the amenities. Homesites are now available for between $200,000 and $800,000 with the prices likely to increase as sales continue. If I was looking for a luxury preconstruction home in Sarasota away from the water, the Lake Club would be where I would start.

New Condo Conversions on the Horizon

2005-10-10T10:34:00.000-04:00

In a continuing trend that just never seems to tire investors, three more apartments are being converted to condos. Village West in Bradenton was purchased for $2.5 million- or $92,500 per unit for the 27 unit complex. Sugartree Village Apartments in Sarasota will also be converted. This property was purchased for $15.6 million- or $77,600 per unit for the 201 unit complex. Saddle Creek apartments off of 26th Street in Bradenton will also be converted, giving the nudge to the residents of the 272 unit complex if they choose not to buy. As affordable housing becomes more and more scarce, we can expect these condo conversions continue until investors start losing money. However, based on the prices above, it is not hard to see how the conversion business is extremely lucrative. Buyers of the large complexes are filling a need in Sarasota right now- giving housing and ownership to lower earning families.

New Condo Development Opens for Sales: Serenata

2005-10-06T11:52:00.000-04:00

In my capacity as an agent, I am constantly getting calls from investors who want to be the first to buy in new developments. Well, one just opened for sales last Sunday called Serenata. Heres my take- the property is nice but exposed to a lot of commercial activity. The units are attractive and look similar to apartment buildings with the prices ranging from the 200s to the 300s. The upsides are the location and the fact that there are no investor restrictions except that you can only purchase two units. The downsides are the the 2% developer cost added to the price and the high monthly maintenance fees. This property is a great example of my point that developers are not stupid- meaning these units are priced at the upper limit of what the market will bear. They will also be released in phases to maximze sales dollars. I really like Serenata for someone who needs a cheaper condo in Sarasota. For investors Serenata looks tight pricewise, but may be a good shot for a longer term hold. After all, we have not seen any new construction condo releases in this price range for quite some time. Also, the rental restrictions are lax, which is a positive for investors. For more info, shoot me an email.

Market Snapshot: Lakewood Ranch Single Family Homes

2005-10-06T11:20:00.000-04:00

If you've lived in Sarasota for any amount of time, you have surely heard the buzz about Lakewood Ranch. I am becoming more and more interested in this area for several reasons. The first is that the land is absolutely gorgeous. This masterplanned community has done a great job with conserving wide open spaces for everyone to enjoy. The second reason is that commercial development has finally caught up with residential sprawl. With the much anticipated opening of Main Street and the shopping center coming soon, finally all the residents of the Ranch will not have to drive far for high-end dining and retail. The numbers for the last year are solid:

September 2005
New Listings: 67 Sales: 32 Average Sale Price: $522,953 Average List Price: $682,364 Average Days on the Market: 72

March 2005
New Listings: 53 Sales: 48 Average Sale Price: $ 456,247 Average List Price: $ 701,029 Average Days on the Market: 76

September 2004
New Listings: 32 Sales: 26 Average Sale Price: $ 580,562 Average List Price: $610,553 Average Days on the Market: 116

Inventory is up just like everywhere else, but I do not see this as a problem. Its more of an opportunity. Great developments like the Country Club will continue to hold their value and appeal for many years to come, especially with the arrival of many other high end developments further east like the Concession and the Lake Club. For information on these areas, email me at drew@srqlife.com.

Market Snapshot: Central Sarasota Single Family Homes

2005-09-26T12:49:00.000-04:00

Central Sarasota has always been a hot spot due to its proximity to beaches, doctors, shopping and great schools. These statistics should give a glimpse as to what the market has done over the last year. Perhaps the most shocking number to consider is that the average sale price of a central Sarasota home has increased 57% in one year. For you locals, the area that I am considering to be central Sarasota is the square between Fruitville Road and Central Sarasota Parkway, sandwiched by US 41 and Interstate 75. Here's the numbers:

September 2005
New Listings: 219 Sales: 106 Average Sale Price: $395,924 Average List Price: $421,247 Average Days on the Market: 76

March 2005
New Listings: 196 Sales: 173 Average Sale Price: $323,457 Average List Price: $397,142 Average Days on the Market: 68

September 2004
New Listings: 232 Sales: 173 Average Sale Price: $252,047 Average List Price: $267,913 Average Days on the Market: 101

Notice that new listings this month double the sales so far! Talk about a correction! Buyers can relax a little bit and enjoy a more powerful situation in the market and the negotiating process. If you have been contemplating a buy in the Central Sarasota market, now is a great time to consider making your move.

Market Snapshot: Longboat Key Condos

2005-09-26T11:57:00.000-04:00

One of my favorite niche markets in Sarasota is the Longboat Key Condo market. This market is one that has a wide variety of properties, all with close proximity to one of southwest Florida's most pristine beaches. My data here shows me that the pace of sales is slowing in most areas of our market right now- including Longboat Key. Keep in mind that these statistics include all of Longboat Key, and are for condominiums only.

September 2005
New Listings: 38 Sales: 20 Average Sale Price: $955,450 Average List Price: $936,039 Average Days on the Market: 124

March 2005
New Listings: 55 Sales: 55 Average Sale Price: $947,346 Average List Price: $1,111,645 Average Days on the Market: 136

September 2004
New Listings: 25 Sales: 33 Average Sale Price: $649,415 Average List Price: $716,892
Average Days on the Market: 170

Notice that this month lacks the equilibrium in listings and in sales that caused Sarasota's extreme seller's market over the past couple of years. While prices on Longboat Key continue to hit all time highs, the frequency of these sales seem to slowing. Time will tell if this is seasonal, but after looking at the stats from '04, I would say things are slowing.

The State of the Market

2005-09-20T12:16:00.000-04:00

What is really going on in this market? Well, there are several factors contributing to what I see as a general slowdown in the real estate market. Have you seen the signs of a slowing- notice the length of time homes stay up for sale, and open the paper and see how many homes are advertised as "reduced." Typical of this season, the market has slowed down and buyers seem to be a little more scarce than they used to be. I fully expect "season" (October to April) to change things drastically, but I wonder how much of the hype will be residual from last year. Sarasota will remain in heavy demand, but maybe the market will bear a slightly more level playing field this year instead of favoring the seller almost unilaterally.

What does it all mean? Everyone in the industry is trying to catch their breath after a dizzying run. Sellers are realizing that their has to be some logical basis for the price they are charging, and buyers are realizing that the negotiating process does indeed exist. We are going to see a drop in For Sale By Owners and Realtor relevance is going to comeback into the picture. I think Realtors will be needed more for marketing and networking to move housing inventory. Also, over-leveraged investors might be in for some foreclousres if prices don't inflate another 30% this coming year. I would still feel confident to purchase, but buyers need to rethink their strategy if they are banking on huge property price gains again. I hope this is helpful. Email me with your comments, good or bad, at drew@srqlife.com.

Condo Conversion Blues

2005-09-19T17:09:00.000-04:00

I think that sometimes people have a very unfounded sense of confidence when purchasing through a condo conversion. I have sat and watched buyers sign contracts that they have not even read. Just because there are people in front of you in line signing quickly does not mean that you should too. Be careful.

One such example that demonstrates my point can be found in a recent contract I was dealing with. Effectively, once a buyer signs there is no financing contingency or remedy for not being able to get a loan. This means the buyer is making a cash offer with no way to back out regardless of whether they can get a loan or not. Just because the state contract allows for a financing contingency does not mean that a contract from a developer will do the same.

Make sure your agent has had proper time to evaluate the contract you are signing. Sign slowly and make sure that you understand every clause. And remember, just because the developer's lawyer drew the contract up does not mean it cannot be altered. Don't shy away from asking for more, or at least a fair contract.

Stupid Developers??

2005-09-19T10:40:00.000-04:00

I think not. With the state of the current market I am constantly receiving phone calls from investors and home buyers alike who are sold on the idea that anything preconstruction is a great idea. The investors think that it means instant money in the bank at closing time, and home buyers think this is way to get the most bang for their respective bucks. Allow me to differ.....

While many small fortunes have been made in recent months on preconstruction "flipping," the idea that developers sell cheap to complete the development is erroneous. If anything, developers have cashed in on the recent buying frenzy boosting their profits to all time highs. While I do not argue the point that costs have increased to builders across the board, I do take issue with the thinking of many buyers and investors who earmark these products as "good deals." I am currently watching several scenarios play out where investors bought a product from a developer at such a high price that their margins after the flip, coupled with their tax liability from the resale make their efforts look like a waste of time. For the couple thousand dollars they make they should have just taken a vacation instead of sinking money into a low paying investment.

My advice: When you are investing or looking to purchase a residence strategically, don't follow the masses. While many have made money buying straight from developers in the past, I think that the developers are not as dumb as some think they are. They realize that they can sell to end users at a premium, and that's exactly what they are doing. The key to successful investing and purchasing for profit in this shifting market is to be DIFFERENT. I think that there are a lot of sleeper deals out there on existing property that have the potential for profit. So before you rush to sign your life away on a half of a million dollar condo that isn't even built yet, check the markets pulse and look around first. While there are some deals still out there, remember the pop culture adage "fools rush in."

SRQ Life Blog Lauches

2005-09-12T09:57:00.000-04:00

Thank you for coming to view my blog. For me, this blog represents a place where I can pass on my experiences and opinions- essentially a place where I can give back to the great community that supports me. If you have comments or questions, feel free to email me at: drew@srqlife.com.