SW FL Real Estate

Check out all my blogs.....combined blogs for both Real Estate and Insurance can be viewed by clicking the link below:

http://connell-tc.blogspot.com/

What is your personal situation with property insurance in SW FL?

As a realtor, we are really struggling working with clients trying to obtain adequate coverage at a "close to livable" cost.  My personal home insurance has been terminated.  The "bad hands" people rec'd approval to terminate another 130,000 policies in FL.  That should be really helpful.  I am going to make my own personal dent in this problem.  I am talking to, what I believe are, the right people and we are going to provide outstanding insurance coverage at rates that will at least beat the current rates available from these current companies..... stay tuned...

The market is staying fairly active as we look into May.

The national sales data for March is out and it isn't getting better.  If anything, it gets worse.  For example the USA Today reports the national  numbers for March were the worst in 18 years. 

1. It's the "buy now" syndrome.  What? 
2. Yeah, SW FL has the best buyers market in the last 15+ years.  That's why people say, "buy now". 
3. It's your call, Mr/Mrs. buyer. 
4. Are you going to buy at the bottom of the market?  Probably not.  You are never going to buy at the absolute bottom. 
5. But, buy now and no matter what happens in the next few months - you are going to be great 3-5 yrs. from now.
6. If you are a buyer in this market you hold the cards and the leverage.

There are great opportunities for 1st time buyers and limited resource buyers as well as for cash buyers and high equity buyers.  Why is that?  Because sellers must be creative if they want to sell their property.  That means?  With a true professional agent representing the buyer, there are many possible concessions from a seller (not just final sale price) that could be most beneficial to the buyer. 

I will keep posting current real estate sales transactions info for the month of April - that I have commented on in prior postings as the busiest month of the year in this SW FL market.... Then, in May, we will have a better feel for what the summer will bring to this market.

Let's talk about these things - post a comment - a question - a comment - email me with any of the above, etc.... what do you think?

I just read a good article on the conditions of this market. I won’t plagiarize it but I will hitch hike from it a bit.

As discussed many times on this spot, April is the busiest month of the year. We normally head into slower months from this point until the end of the year. The current over supply doesn’t speak well for seller pricing over this future time. The seller must know when to take the hit and when not to take the hit. Sellers must ask themselves: Is it mandatory to sell this year? If yes, you must get creative and be in the lower 20% of your comparable price range. That price range may change frequently. Sellers must stay up with comparable sale prices (through their listing agent).

IF the answer to that question was no or maybe – evaluate further and or take it off the market – now.

Here are some evaluation points/factors:

• Your annual cost of owning the property (payments + interest, property taxes, insurance, utilities, mandatory fees, maintenance).
• That is your total annual loss or cost of ownership because the property hasn’t appreciated in the past year.
• Estimate the net amount to you after selling the property – today.
• Take that number times about 4% for the simple interest – time value of the money.
• This process makes no calculation for tax consequences of any kind (positive or negative).
• This total is what it costs you to own this property and not sell it and or price it at a number where it will sell.
• IF the property appreciates at a rate of 5% per year over the next (?) years - what does it take to get you out of this hole?

The next step is to take that cost of ownership and reduce it by a realistic rental income number if you decide to rent it for the next year or longer. This rental number will put a band aid on the wound but won’t do much to heal anything. Don’t forget after you rent it for a year or two you will be forced to spend thousands of dollars renovating it to try to make it marketable again.

Now you must decide. Is it time to take the hit or do you wan to hold on for another year or two?

Here are the Bonita Springs - Estero real estate sales and pending sales numbers compared to prior years.

	4/1 Thru 4/20/07	03/07	04/06	04/05	04/04
Both Pending	131	169	141	346	289
Estero Only	36	46	39	77	45
Both Sold	63	134	149	315	282
Estero Only	17	29	32	79	49

What does this tell us?  A lot of things but maybe nothing we didn't know:

• We will likely pass March pending and sold but you always do...
• We will likely pass April '06.  That wasn't assured but that is positive
• '05 won't be seen again for many many years but it shows you where our market was at its' peak
• We won't even get close to the market activity for '04
• This market is therefore less active then it was 3 years ago.  You have to find records for 4-6 years ago to find comparable activity levels
• That does not indicate the prices being reduced to 4-6 years ago however, they appear to be reduced to 2 year ago levels
• Due to Feb. & Mar. being such slow months, we can't catch the sold #'s of prior years for the month of April

What's your take?