Tuesday, December 23, 2014

How Do Mortgage Buyers Compete with Cash Buyers?

In the past 90 days, just over half the single home sales in Venice were to cash buyers.  Banks that are selling foreclosures prefer cash buyers, as do home owners selling on the open market.  Here's some tips to make sure your purchase offer with a mortgage is as attractive as possible to a seller.

1) Be prepared:  You have to be ready to show the seller you are a serious buyer by having a pre-approval letter from your lender.  Go do it.  Now.

2) Put as much escrow deposit down as possible: The more skin you have in the deal, the better it looks to a seller.  $1000 escrow deposits might work in certain price segments of the market.  But, if you really don't have more than $1000 to put down, are you qualified to buy a home in the first place?

3) Do your inspections quickly: FL contracts allow a 15 day period for home inspections.  You should offer 10 days.  You look like a more eager buyer who doesn't want to use the inspection contingency period to potentially back out of a contract.

4) Don't haggle: I know, your first reaction to reading this is "Wait, don't you work for me?".  According to the MLS, the Venice FL single family median sales price is 3% off the list price.  In other words, you should plan on a final price that is 97% of the list price.  My job as your buyer's agent is to work in your best interest, and your best interest isn't beating up a seller in a negotiation in this market.  Your best interest is in getting in the market now, before prices increase even further.

Every situation is different.  When you are ready to buy a Venice FL home or condo, please contact me to assist you in all your real estate needs.

Market Update: Venice FL Homes for Sale Cash vs Finance

If you need to get a mortgage to buy a Venice FL home or condo, you'll be competing with a lot of cash buyers.

According to our MLS, in the past 90 days, there have been 229 single family homes sold with all cash terms and 217 single family homes sold with conventional, FHA, or VA mortgage loans.

CASH PURCHASES
Median sold price: $218,000
Median days to contract: 26
Median sales price % of list price:  97%

FINANCE PURCHASES (Conventional/FHA/VA)
Median sold price: $226,000
Median days to contract: 26
Median sales price % of list price: 97%

Bottom line:  Whether you are paying cash or financing your Venice FL real estate purchase, properties are selling fast and at very close to list price.  Please contact me to assist you with your real estate needs.

Thursday, December 18, 2014

Coming Soon in Sarasota

One of my clients is renovating a home in Sarasota that is walking distance to Phillippi Shores Elementary School, just north of Proctor Rd. and east of Tamiami Trail.  It should be ready for sale by the end of January.

home for sale coming soon in Sarasota
The open floor plan of this coming-soon home in Sarasota has lots of light and beautiful solid hardwood floors.

This 3/3 home with bonus room/office/4th bedroom features all (real) wood floors, upgraded cabinetry (some hand-crafted), all new appliances, new roof, A/C, and lots of closet space. The master bedroom will have a dual vanity, a spa tub and separate shower stall, and his and her's closets.  The lot has plenty of room to add a pool.

If you'd like more information about this home please contact me.


Friday, December 5, 2014

Investing in Sarasota and Venice FL Real Estate

There's been some news about real estate investors tapering off their purchase activity as housing prices increase.  That doesn't mean that the smart investors are giving up, because there's still good deals out there and a lot of rental demand in both Sarasota and Venice.

For years after the real estate market downturn in 2008, it was easy to pick the low-hanging fruit of a $100K foreclosure, fix and flip it, or clean it up to rent for cash flow property.  In today's market, smart investors are factoring price appreciation in their formula for picking properties.

Sarasota and Venice real estate is appreciating at healthy rates, but the higher overall price point of Sarasota versus Venice makes Sarasota a more difficult area for a newer investor to dip their toe in the market.

Let's look at a side by side comparison of the two areas:

Sarasota

  • Target price range $150-$200K
  • Highest rental demand:  Bahia Vista south to Clark Rd, west of Beneva and east of Tamiami Trail
  • Estimated rental rates:  $1300 to $1700 per month for annual tenant
  • Housing types: single family home resales, 1300-1500 sq ft, minimum 3 bedroom 2 bath
  • Estimated major expenses: $900 per month mortgage with 30% down on a $175,000 loan, $2500 per year in homeowner's insurance, $3000 per year property tax, and management fees of 7-10% per month on the gross rent
  • Appreciation:  7-9% annually
  • Many homes have NO HOA fees

Potential Sarasota investment property $159,900


Venice

  • Target price range $120-$150K
  • Highest rental demand:  Geographic area surrounding Tamiami Trail, south of Center Rd, and the area surrounding Hwy 776 south to Manasota Beach Rd.
  • Estimated rental rates: $900-$1200 per month, annual tenant
  • Housing types: single family home resales, 1100-1400 sq ft, 2 bedroom and 2 bath minimum
  • Estimated major expenses: $670 per month mortgage with same terms as above, $2500 per year homeowner's insurance, $2000 per year property tax, similar management fees to Sarasota
  • Appreciation: 7-9% annually
  • Homes are available with NO HOA fees

Potential Venice FL investment property $133,900 with pool

If you are thinking of investing in Sarasota or Venice FL real estate, please contact me to help you find the right property.

Monday, December 1, 2014

Waiting Costs Money

If you've been looking for Venice FL real estate, or just starting out, you may or may not know that we have more buyers than homes for sale.  Homes are selling quickly, and that is creating frustration for some and a "wait and see" attitude for others.

For those waiting for just the right house to come along, the old saying "time is money" is never more true than in real estate, at least in Venice.

Let's take a look at what waiting to buy could potentially cost:

Now:
Home sales price $150,000 for a 2 bedroom 2 bath in Venice
Interest rate 4.125%
Mortgage monthly payment with 20% down: $581.58

Spring 2015:
Estimated future home sales price $165,000 for a similar 2/2 in Venice
Interest rate 4.35%
Mortgage monthly payment with 20% down: $657.11

Housing inventory is expected to stay low, rates could go higher, and prices are projected to increase between 7%-10% .  Waiting to buy could cost you $76 per month, or approximately $912 per year.  What could you do with an extra $912 in your pocket, especially if you are retired?

If you are thinking of buying a home in the area, please contact me to get started.