How’s the market?

Whenever I see people, whether in a profession or social setting, the first thing they ask me (after they ask about our family) is "how is the real estate market?" This is certainly to be expected, given all the attention which the real estate market is being given by the local media.

There are many ways to answer the question, so here are a few:

1. It is a Buyer's market, and there are Buyers willing to buy. They still love the Sarasota area, and they want a good value when they purchase.
   
2. Showings are typical for early season. We usually have many "lookers" in January, which turn into Buyers in February, March and April. We will really understand the strength of the market after these months have passed.
   
3. Buyers are looking toward real estate as a tangible asset which they can enjoy. The real estate investor has not been seen for months.
   
4. International buyers are largely on the sidelines. Again, we will have to see if they show up during the high season months to make purchases.
   

Since the proof is in the actual numbers, look below to see how we are doing so far. These numbers are sales which have occurred in the past 30 days, the first of 2009. At this time. Longboat Key is leading the pack!

Longboat Key         12 sales    32 pending sales

Bird Key        2 sales        3 pending sales

Lido Key        3 sales        5 pending sales

Are we living in fear?

They say there are two motivating factors when purchasing large items like real estate, fear and greed. Interestingly, buyers tend to be most interested in buying when we are in a Seller's market (actually being greedy when they should be fearful) and less interested in buying in a Buyer's market (being fearful when they should be taking advantage of the amazing values).

In our local island markets, we are seeing this scenario play out every day. Buyers want to purchase the Sarasota lifestyle which we can offer them, yet hesitant to follow through. Those who do commit to buying are finding good choices, great values and historically low interest rates. They are also getting to start enjoying their life today, rather than waiting and worrying.

As Warren Buffet has said on many occasions, "Be fearful when everyone is greedy and greedy when everyone is fearful."

To Buy or not to Buy

People ask me this question nearly every day. Buyers want to know if the market is picking up, and in effect, if it is ok to buy Florida real estate now (the implication being that there might be a better time, perhaps in the summer).
To give the best answer, I need to understand who the Buyer is. If the Buyer is a real estate investor, then the answer is “I don’t know.” Historically, the Longboat Key area has been enjoyed by primary homeowners, long-term vacationers and second-home owners. The short-term investor only came to our area in the 2004/5 time period; they were looking to make quick profits by purchasing and selling quickly into a rising market. For those investor buyers, we may be at or near a bottom, but I cannot say we are in a quickly rising market.
If you are a long-term buyer, the kind of buyer we have been used to on Longboat Key, then most certainly this is the time to buy. If you wait for a confirmed bottom, you will certainly miss it. This not only has financial implications (you will end up spending more), it will also influence your choices. Homes are not like other investments, stocks for example. You can always buy a share of IBM stock, it might big trading at a bottom or 5% above the bottom price; but you can’t be sure that the Longboat Key property you have found will be available when you decide the market is ready for your purchase.

Setting the Record Straight

It is important to remember, and I say it repeatedly, real estate is a localized business. What this means to Longboat Key -area buyers is that we have a good market. Yes, we do have higher inventories available….this means great choices for Buyers. And guess what? Buyers are making their purchasing decisions right now. As evidence, I submit:
There are currently 12 single family homes on Longboat under contract awaiting closing. There have already been 5 closed sales since January 1, 2008.
There are currently 29 condominiums on Longboat under contract and awaiting closing. There have already been 19 closed sales since January 1, 2008.
I have personally closed/contracted $15,000,000 for 2008.
I am directing this information primarily to potential Buyers. I want you to know that the abundance of good property sliming, and if you are still waiting on the sidelines, its
time to get off the fence!

Focusing on the Numbers.

When our real estate market was at its weakest (let’s call that the bottom), I remember people asking me if we were in a Buyer’s market. I ‘d tell them we would be, if there were any Buyers! Well guess, what? There are Buyers out there today.
In fact, the Sarasota Association of Realtors just released the following information:
December 2007 sales were UP 22.7% over November 2007 sales
Overall sales in 2007 were down only 5.8% compared to 2006; last year was still the 7th highest sales year ever, with 6113 homes and 2,166 condominiums sold (of note, condominiums sales were actually up last year over 2006).
2007 was the fifth highest year on record for sales in Sarasota County

Declining interest rates are drawing Buyers back into the market. Once again rates are near historical lows, and mortgages are plentiful and obtainable here in Sarasota County.
I am personally seeing the New Year start out with much activity. My listings are being shown often, we are getting offers (some good, some not), and I am working with Buyers who are making value purchases.
The numbers look good for 2008.

Is your property listed on at least 10 websites?

Did you know that consumers are five times more likely to buy a home found online versus in a newspaper? In fact, according to the National Association of Realtors, “80 percent of home searchers conduct research on the Internet.” It is for this reason that I focus much of my marketing attention on the internet. When I list a property for sale, I create an individual website specific to that property. It describes everything about the listing, including views, room dimensions and the like. It also posts the virtual tour, digital photography, disclosures, floor plans and site plans. We name the site after the address of the property (i.e. 1101bogeylane.com) so that it is easy to find. In addition to the individual site, my listings also appear on some of the following 10 sites:
1. www.longboatrealestate.com
2. www.coldwellbanker.com
3. www.floridamoves.com
4. www.google.com
5. www.trulia.com
6. www.yahoo.com
7. www.craigslist.com
8. www.newyorktimes.com
9. www.homefeedback.com
10. www.coldwellbankerpreviews.com

Interest Rates Become Interesting…

I’ve been spending much of my time talking to Buyers about why I consider this a good time to purchase real estate, and now I’ve got another arrow in my quiver: low interest rates. Don’t let the media scare you, there is plenty of money to be lent to qualified Buyers, and the rates are wonderful.
In fact, interest rates are currently sitting at five-month lows! On a conforming loan, you will be charged 6% for a 30-year fixed loan with no points! Jumbo loans have options starting at 6.25%. These are exceptional rates which will allow you to get more value for you money.
If you would like more information about mortgages and property financing, go to my website at www.longboatrealestate.com.