Wednesday, March 28, 2012

Another Article on National Home Prices

My last two blogs focused on national housing price trends and how they affect the local Sarasota real estate market.

Some brokerages seem to think that all the lovely people filling our restaurants, hotels, and beaches in season signals a return to healthier days for Sarasota's real estate market.  This overly simplistic analysis does not take buyer psychology into account, and results in sellers overpricing homes in the false expectation that values are going to be on the upswing.

Yesterday there was another article on Yahoo Finance from CNN Money showing that potential homebuyers lack confidence in the market.  This is significant because the vast marjority of home buyers in the Sarasota are come from out of state or overseas.  They read these articles and see that values in markets like Tampa made new lows in 2011.

These buyers do not have to buy, and as I blogged earlier, they are motivated by what they deem are the "best deals", whether those deals are in Sarasota, Ft. Myers, Tampa or Orlando.

Conclusion:  Home sellers, do not price your home to sell based on increasing prices, as other brokers may lead you to believe.  The national market and buyer psychology will continue to have a drag on our local real estate market for the foreseeable future.

Tuesday, March 27, 2012

National Home Prices at 2003 Levels

I just read a short article with a very informative graph showing raw national housing prices are now fluctuating around 2003 levels.  You can read this article here:  http://read.bi/GXW1Y4

I recently did an analysis about Zillow's misrepresentation of Sarasota real estate values, where I contrasted their flawed data versus the actual 2010 vs 2011 median prices based on the MLS.  The end result was that median prices year over year in Sarasota are unchanged.

When the national numbers seem to be fluctuating in a small range, and the local Sarasota numbers are stable, this means, in my opinion, the time has never been better to buy Sarasota real estate.

Thursday, March 22, 2012

More Marketing Puffery About Median Sales Prices

More and more Sarasota real estate agents and brokers are getting their hands on data showing median sales prices in Sarasota may be starting to stabilize and even slightly increase, and writing blogs about it.  Since I am a bit of a contrarian, these types of blogs bug the you know what out of me.

Blogging about a strengthening Sarasota real estate market might be a great enticement to get people to list their homes for sale, thinking the worst is behind us.  All indications, in my opinion, show we have another year or so before we are out of the woods.

Overall median sales prices are a function of half of homes sold above or below a certain number.  But it doesn't take into account values in individual neighborhoods or subdivisions.  For example, in 2009 and 2010 we were flooded with bank foreclosures, the great majority under $100,000.  The luxury market was hit hard during those years, with properties above $400,000 being sold at deep discounts with a long market time.

Sarasota has traditionally had a higher median price than Tampa or Ft. Myers. Does that mean our real estate market is "healthier", just because we have had a higher ratio of luxury home sales?  I don't think so.

As foreclosures are taken out of the market, buyers are forced up in price into other subdivisions or neighborhoods that may not have had much or any activity while their lower priced competition accounted for the bulk of sales.  But it may have another effect.

Real estate brokerages and agents can write about how our median sales prices are rebounding until they're blue in the face, but the fact remains that buyer psychology remains solidly focused on getting the very best value.  I have seen some buyers resist paying more in Sarasota by moving their attention to other markets like Ft Myers, Orlando, or Tampa.

In my opinion, scaring buyers away by trumpeting price increases in our real estate market is not a good idea.  I also believe it is misleading to sellers, by "buying" their listing with the hope of an increased selling price.

Thursday, March 8, 2012

What Makes a Great Buyer's Agent?

This question came up on Trulia forums today, and it was a timely coincidence.  I was thinking about this just yesterday.

I was watching Bravo TV's Million Dollar Listing.  What can I say?  I love seeing other people's houses, part of why I love being in the real estate business.  This show also happens to be a great example of what does NOT make a great buyer's agent.

I recently blogged about the Realtor Code of Ethics and Florida real estate law, which says a Realtor may not convey a minimum price to either party without the express consent of the buyer or seller they represent.  This did not happen on this program.

Cut to one scene with the two cooperating brokers negotiating price on a golf course, without consulting the buyer or seller.  Cut to another scene with one agent saying "I'll take $X....".  He'll take?  He is not the seller.  Cut to another scene with the agent concerned about a cut in compensation over a price reduction.  None of this should happen in a real estate transaction.

When you hire me to represent you in the purchase of a home, rest assured your needs come first.  I present all options, show homes that closely fit your needs, and above all, listen.  Read more on my website for buyers and for sellers.

Wednesday, March 7, 2012

Follow Up: Media Disinformation about REO's Substantiated

A day after I blogged about an article predicting more doom and gloom because of increased foreclosures entering the market, a new article today seems to support my position.  Read the article here:  http://bit.ly/xOaNVS

The report from Clear Capital found that while the number of bank owned properties for sale did dramatically increase in the top 15 markets (not the Sarasota/Bradenton market), prices in those areas showed average gains or mostly stable home prices compared to the previous month.  The article I blogged about yesterday, using Realty Trac as a source, predicted dumping foreclosures in the market would further depress home prices.

Any time anyone reads a real estate article relying on Realty Trac, Zillow, or Trulia, they should take the predictions with a grain of salt.

Tuesday, March 6, 2012

More Disinformation in the Media

This article was linked on the Drudge Report, so it likely got a lot of hits.  The dire headline:  Foreclosure Sales Flood Market.

The basic problem with the article is that it relies on Realtytrac.com as a source.  Ugh.

Realtytrac is the same thing as Zillow.  They are not a licensed real estate broker, and they do not have access to MLS data.  They scrape the same property tax assessor websites as Zillow.   As we all know, tax values have little to do with actual market values.

Apparently, the doom and gloom for this article comes from the fact that local municipalities have recorded a higher number of foreclosures.  This does not mean these foreclosures are even on the real estate market, but the article says this increase is an indicator of a future glut of distressed properties.

In the Sarasota and Bradenton real estate market, a year ago there were approximately 5500 short sale and bank owned properties available for sale the MLS.  Today, there are 1700 available short sales and foreclosures.  Yes, BOTH short sales and foreclosures.  My analysis of Sarasota and Manatee County real estate prices shows most popular neighborhoods are flat to up in average price and price per square foot in 2011 versus 2010. 

It is hard to see how our local real estate market will experience a glut of distressed properties in 2012.  Don't believe everything you read in the media.

Sunday, March 4, 2012

Closing Costs in Sarasota

I get a lot of hits on my website about real estate closing costs in Sarasota.

Are any costs negotiable?

The state of Florida imposes taxes on both buyers (both US citizens and foreign nationals) and sellers of real estate.  For buyers, there is the intangible tax on mortgage and doc stamps on mortgage.  Along with the owner's title policy, these three items make up the largest portion of the overall buyer's closing costs.

Buyers should be prepared for additional fees such as a home inspection, termite inspection, mold inspection, well or water testing, septic tank inspection, home or condo association application fee, and various recording and administrative fees.

In our area, many of the large franchise real estate companies, like Coldwell Banker, charge the buyer a fee of $250-$350 at closing.  This is a junk fee, and goes straight to the bottom line of the brokerage.  Buyers should NOT have to pay any fee for a Realtor to represent them in a transaction.  

Sellers are subject to a doc stamp tax on the deed, which are paid from seller's funds at closing.  Combined with the fees a seller pays to a real estate agent, these constitute the bulk of the seller's closing costs.

In a short sale or foreclosure, the seller's lender often agrees to select and pay for the closing agent or attorney, the closing agent fee, and the owner's title policy.  In a traditional sale, these fees are usually paid by the buyer.

You can view a closing cost calculator and more information on my website:  www.davidbarrhomes.com/closing_costs_sarasota

Thursday, March 1, 2012

Sarasota Ranked Top Place to Retire

Find out what people who live here already know about why Sarasota is so great, according to a study by TopRetirements.com and an article on Moneywatch.com:

http://bit.ly/y9Woon


More Zillow Backlash

Seems I am not the only person with a deep dislike of Zillow and how they misrepresent real estate values, particularly here in Sarasota.

I've posted here about specific flaws in Sarasota real estate data on the Zillow site, but some brokers and even entire MLS systems are banning their data from being displayed on Zillow.

Here's a great recent article from MSN Money:  http://on-msn.com/zVTnbq

I have a list of more articles on my real estate website about Zillow:  www.davidbarrhomes.com/debunking_zillow

Sales reps from Zillow call me constantly to advertise on their site.  Sorry folks at Zillow, I refuse to tarnish my real estate expertise by being a sponsor of your garbage in/garbage out website.