Friday, January 21, 2011

When Agents Don't Disclose

A lot of Realtor Associations are good ol' boy clubs, and I think Sarasota Association of Realtors sometimes falls in this category. 

In this type of atmosphere, the members, in my opinion, seek to go along to get along.  I don't subscribe to this philosophy, especially when less than scrupulous behavior is involved, whether legal or not.

Here's a case in point.  Today, a Broker/Owner, a member of the Trulia online Realtor community, posted a question:  "What is your favorite Sarasota webcam?".  You can see the thread on their website with this link: http://bit.ly/dIovB6.

I won't get into the ins and outs and whims of how Trulia polices their online community. What irked me was that the Broker owns the Sarasota webcam website, and used the forum to seek to increase traffic to the website, where he also has a large banner ad for his real estate website, at his collegues' expense.  So what, you may ask?

In our business, we are told to disclose, disclose, disclose.  While this Broker didn't do anything illegal pertaining to FL real estate law, it does make me wonder, if he won't disclose he owns that website to other Realtors in a bald-faced attempt to fool readers into visiting it, what else does this Broker not disclose? 

I also found it strange that other Realtors cheerfully responded without checking out the information.  If this was a real estate contract, does this illustrate their level of the understanding of due diligence?

Lesson to Trulia members and consumers:  read the content and judge the level of competency displayed there yourself. 

Friday, January 14, 2011

Market Update: Foreclosure Inventory

I just updated my website, http://www.davidbarrhomes.com/, with my exclusive market inventory meter. 

It's starting to look like foreclosure inventory in Sarasota, Manatee, and Charlotte Counties is slowly but steadily shrinking, with only 1,052 single family and condo properties for sale, while the overall inventory is steadily increasing.  What's going on?

We are in our busiest real estate season, as buyers take advantage of a warmer climate to vacation and buy property.  These buyers are snapping up foreclosure properties right now faster than the banks are releasing inventory into the market, hence the short term drop in inventory.  If you are planning a trip here to buy real estate in the coming weeks, more than ever you should be prepared with your financing documentation and expect to be in multiple-offer situations on foreclosures.

Home sellers also know this is the best time of year to find a buyer, so we are seeing more traditional sales come on the market.  I would advise buyers right now to also consider non-foreclosure properties.  Sellers remain negotiable in pricing and concessions to get their property sold.

Tuesday, January 11, 2011

When the Emails Stop

I am no longer getting email updates from our "luxury leader" on price reductions.  I used to get several emails a day, which I never really understood.  It resulted in them showcasing in a shocking way, how wrong they were about their original listing price, and how much they have now lowered the price of their listings.

At one point, I calculated they had reduced prices by $10 million dollars in a week, and that was just for the property emails I had received.  One particular property which sticks in my memory was on Siesta Key that underwent a $1 million price reduction, which still is not sold.

Can you, or anyone in this market, afford to make a $1 million mistake?  "Biggest" isn't always best.  I guess someone over there figured out these emails didn't make them look especially expert at market analysis.

Monday, January 10, 2011

Herald Tribune Puffery Again?

I've heard a lot of people complain that the Herald Tribune was one of the biggest cheerleaders of the real estate boom and bust.   The real estate market, much like the stock market, reacts to consumer moods.

So this weekend the H/T posts a story about Lakewood Ranch's seeming real estate revival.   According to their real estate "expert" Harold Bubil, there were 250 contracts signed to build new construction in LWR in 2010.  Really?  I don't buy it.

What's really going on in Lakewood Ranch? 

On my website, I have posted real estate sales data for Lakewood Ranch for the past 4 years.  The number of sold units (both single family and condo) was flat, and while the average sales price increased, the average sold price per square foot decreased in 2010 versus 2009.  Average days on market went from 217 in 2009 to 203 in 2010, not exactly an indication of a reviving market.  Price per square foot likely dropped because there were more high-end properties selling at reduced price.

The H/T and most newspapers rely, or used to rely, on real estate classified advertising for a large chunk of their revenue.  I'll leave it to you to decide if they are publishing this kind of story to try to heat up the real estate market like so many thought they did in the boom years.

Friday, January 7, 2011

Marketable Title vs Insurable Title

Title claims in the current foreclosure market, such as the Bank of America/Countrywide issue, make this topic interesting for both Realtors and real estate consumers.  Lenders are more frequently looking for marketable title on properties, especially foreclosures, prior to closing.

Sales contracts generally require the seller to convey a marketable title to the purchaser. A lender will generally require the title to the property securing the loan to be marketable. 

Insurable title may come with a host of defects.  However, despite these defects, a title insurance underwriter weighs the risks involved and allows the title agent to issue a title policy even though there may be blemishes and potential problems down the road.  Ironically, should the value of the property increase dramatically, the buyer is only protected to the extent of the original purchase price.

In contrast, marketable title is a title that is clean, has no defects that will come up again in a future title examination when the property owner attempts to obtain financing or more importantly tries to sell the property.  Accepting insurable title could result in problems which need to be addressed at a later date resulting in both time and money.

Translated to the current marketplace, you should make sure you have an insurable title on the property you purchase, especially in a foreclosure.  If you purchase a marketable title, make sure there are no exceptions added by the title company that excludes them from liability if you later sell the property and the title is deemed not marketable.

Wednesday, January 5, 2011

Sarasota Real Estate Statistics

Have you ever seen real estate statistics on Zillow, Trulia, Realty Trac, or our area's "luxury leader", and wondered, "What the hell does all that gibberish mean?".

I decided it was time to put together meaningful data that real estate consumers can understand, and that relates to their needs when searching for and evaluating property.

I put together real estate statistics for the past four years for areas in Sarasota, Charlotte, and Manatee Counties that correspond to my neighborhood maps.  There you can see average sales prices, price per square foot, number of units sold, average time on the market, and list price to sales price ratio.  These are for single family homes only.

Why did I pick these metrics?  I approached this as I would a CMA, or as a real estate or mortgage appraiser would, by looking at values to determine trends and prices.  Time on the market and LP/SP ratio are excellent indicators of a firm or soft market, and the data I compiled points to some interesting trends.  I also thought that out-of-town buyers would find the price per square foot differences interesting, for example, when comparing property on the barrier islands.

Serving long distance clients

I love using technology to provide services to my clients.  Today is a good example.  I worked with a couple from out of state during their visit to our area over the Christmas holidays.  Unfortunately, we did not get a home under contract during their time here, but we developed an excellent rapport and I gained a thorough understanding of their real estate needs.

Today, I'll be heading to North Port to do a Virtual Walk-Through of a home that is newly listed for sale.  The buyers already know and like this area quite well thanks to their visit.  By providing them a video of a home for sale, they don't have to physically be here to see a property.  I post raw video of the home, filmed as I'm walking through it, and post a link to the video on my web domain, which I can email to my clients.  All they have to do is click the link and watch the video.

According to a NAR study, 74% of buyers look for real estate video, but less than 1% of Realtors provide it (and I think it's even less than that in the Sarasota area).  I invite you to read more about Virtual Walk-Through technology on my website.

Tuesday, January 4, 2011

New feature on davidbarrhomes.com

I recently added some new information to my real estate website, davidbarrhomes.com, that I hope buyers and sellers will find useful.

On my home page, MLS search page, and foreclosure search page, you will find an inventory meter showing the total number of available listings in Sarasota, Manatee, and Charlotte Counties.  You will see actual numbers of units available, with a trend indicator showing if the inventory has grown or shrunk appreciably since the last update.  I plan on updating this weekly.

An educated consumer is the best consumer, and it's important to let show how available property inventory levels can affect pricing and buying strategies in the current market.  I believe this is a one-of-a-kind feature among real estate agents in my market area.

This, combined with my Just Listed and Open House pages, and numerous interactive maps, make davidbarrhomes.com one of the Sarasota area's most informative and innovative real estate websites.