Worst Cities For Homeowner Debt

I read an interesting article tonight from Forbes.com about the worst cities for homeowner debt.

Here are the top 50 cities for worst homeowner debt:
Sacramento--Arden- Arcade--Roseville, CA
Denver-Aurora, CO
San Diego-Carlsbad- San Marcos, CA
Minneapolis-St. Paul- Bloomington, MN-WI
Washington-Arlington- Alexandria, DC-VA-MD- WV
Los Angeles-Long Beach- Santa Ana, CA
Boise City-Nampa, ID
Colordo Springs, CO
Las Vegas-Paradise, NV
Madison, WI
Reno-Sparks, NV
Boulder, CO
Seattle-Tacoma-Bellevue, WA
Detroit-Warren-Livonia, MI
Cincinnati-Middletown, OH-KY-IN
Riverside-San Bernardino-Ontario, CA
Portland-Vancouver- Beaverton, OR-WA
Columbus, OH
Richmond, VA
Atlanta-Sandy Springs- Marietta, GA
Boston-Cambridge- Quincy, MA-NH
Green Bay, WI
San Francisco-Oakland- Fremont, CA
Lexington-Fayette,KY
Cleveland-Elyria-Mentor, OH
Phoenix-Mesa-Scottsdale, AZ
Salt Lake City, UT
Raleigh-Cary, NC
Worcester, MA
Louisville, KY-IN
Baltimore-Towson, MD
Pittsfield, MA
Indianapolis, IN
Charlotte-Gastonia- Concord, NC-SC
Bridgeport-Stamford- Norwalk, CT
Akron, OH
Dayton, OH
Virginia Beach-Norfolk- Newport News, VA-NC
Lansing-E.Lansing, MI
Providence-New Bedford- Fall River, RI-MA
Appleton, WI
Portland-South Portland- Biddeford, ME
Durham, NC
San Jose-Sunnyvale- Santa Clara, CA
Lincoln, NE
Allentown-Bethlehem- Easton, PA-NJ
Omaha, NE-IA
New Haven-Milford, CT
Milwaukee-Waukesha- West Allis, WI
Orlando, FL

Do you see anything interesting? There is only one city in Florida and that is Orlando and #50. It is refreshing to see this.

Market Update

Sarasota MLS shows:
846 single family homes under contract and waiting to close
362 condominiums under contract and waiting to close.

SKY Sotheby's Luxury Property Auction

SKY Sotheby's hosted another luxury portfolio auction yesterday at The Longboat Key Club. The auction team was much more selective this time. Last November there were over 80 properties for sale which was way too many. I was pleased with some of the results. The highlight of the auction was the sale of 4067 Shell Road.

This home on Shell Road has been on the market since November 2006. It was originally listed for $12,800,000. It was eventually lowered to the current asing price of $9,950,000. This is a good example of how an auction can be successful when the traditional method is not working.

This home at 1644 Dolphin Lane fetched in the 900,000's. I dont remember the exact number but with the 10% buyer premium the final sales price will be just over $1,000,000. This recently built home at 1654 Dolphin Lane in downtown Sarasota fetched $775k which puts the final sales price at $852,500. The above two homes were very nice.

The home above was located in The Sanderling Club on Siesta Key. I don't remember the exact amount it fetched but I believe it was just over $1,100,000. While this number was much lower than the asking price of $1,660,000 I think the final sales price was near market value. Auction haters may go on about how low this fetched compared to the asking price but that is going to happen when the asking price is too high.

These were great units near Bradenton beach. There were 3 of them in the auction and all fo them sold. They have partial views of the bay and the gulf! Every amenity including elevator, full use of the bayfront pool and dock, attached garage, beautiful finishes throughout and only 1 block to the white sand beaches.

This is Hudson Crossing on Orange Avenue west of the trail. These were finished in 2007. It is a small community of 12 units offering bayou views and sailboat water. They are very nice. This was put under contract shortly after the auction. There were other sales and I am sure a few more of them will come together over the next few days. Overall, I think it was a very successful day. Love them or hate them auctions can be successful for some people. They aren't for everyone. In fact, they probably aren't for 99% of the general selling public. There are situations where they can be useful. If you want to buy or sell in the next auction give me a call at 941-812-6272.

What is Selling?

I was getting a haircut the other day when I overhead the guy next to me talking about real estate. This guy was telling his stylist that only the low end of the market was selling. It turned out that this guy was not a Realtor so I'm guessing he heard this information from one.

Let's see what is selling. Below are all of the sales of single family homes and condos by price range for the first quarter of 2008.

There were 1,293 total sales of homes and condos in the first quarter of 2008.

$3 million and up - 10 units - .7%
$1,000,000 - $2,999,999 - 86 units - 6.6%
$500,000 - $999,999 - 184 units - 14.3%
$300,000 - $499,999 - 293 units - 22.7%
0 - $299,999 - 720 units - 55.7%

Since I just woke up from a very refreshing nap I am going to the Sarasota MLS and get these same stats from 2002 to 2007.

2002

1,773 closed homes and condos in the first quarter of 2002

$3 million and up - 9 units - .6%
$1,000,000 - $2,999,999 - 51 units - 2.9%
$500,000 - $999,999 - 117 units - 6.6%
$300,000 - $499,999 - 262 units - 14.8%
0 - $299,999 - 1,334 units - 75.2%

2003

2,012 closed homes and condos in the first quarter of 2003

$3 million and up - 6 units - .2%
$1,000,000 - $2,999,999 - 69 units - 3.4%
$500,000 - $999,999 - 214 units - 10.6%
$300,000 - $499,999 - 319 units - 15.8%
0 - $299,999 - 1,404 units - 69.7%

2004

2,557 closed homes and condos in the first quarter of 2004

$3 million and up - 10 units - .4%
$1,000,000 - $2,999,999 - 102 units - 3.9%
$500,000 - $999,999 - 335 units - 13.1%
$300,000 - $499,999 - 521 units - 20.3%
0 - $299,999 - 1,589 units - 62.1%

2005

2,612 closed homes and condos in the first quarter of 2005

$3 million and up - 19 units - .7%
$1,000,000 - $2,999,999 - 159 units - 6%
$500,000 - $999,999 - 494 units - 19%
$300,000 - $499,999 - 705 units - 27%
0 - $299,999 - 1,235 units - 47.3%

2006

1,687 closed homes and condos in the first quarter of 2006

$3 million and up - 13 units - .8%
$1,000,000 - $2,999,999 - 116 units - 6.8%
$500,000 - $999,999 - 405 units - 24%
$300,000 - $499,999 - 493 units - 29%
0 - $299,999 - 660 units - 39.4%

2007

1,722 closed homes and condos in the first quarter of 2007

$3 million and up - 24 units - 1.4%
$1,000,000 - $2,999,999 - 104 units - 6.1%
$500,000 - $999,999 - 359 units - 20.8%
$300,000 - $499,999 - 541 units - 31.4%
0 - $299,999 - 694 units - 40.3%

Low end of the market
The percentages are obviously going to change as the overall market prices move up and down. In the 2003 to 2006 time frame notice that the percentage of homes selling under $300k decreases as market prices moved up. Also notice that in 2002 about 75% of the units sold were under $300k.

Now as prices decline from 2006 to 2008 the number of properties under $300k increases.

Luxury Properties
Even though prices have declined from 2006 to 2008 the million and up market still constitutes 6%-8% of the market.

So what does all of this mean? I don't know but let me digest it. Right now, my family is waiting for me to take them to dinner.

What do you think?

Ft. Lauderdale/Miami Luxury Property Auction

In conjuction with other Sotheby's affiliates SKY Sothebys and Daniel Decaro conducted a portfolio luxury property auction in Ft. Lauderdale yesterday. The auction included properties in the Ft. Lauderdale and Miami area. Take a look at the two stunning properties below. It looks like the auction was successful in uncovering buyers for each of these properties.

One Isla Bahia - listed at $22,999,999

1235 East Lake Drive - listed at $14,999,000

Since the Ft. Lauderdale/Miami real estate markets are behind Sarasota in terms of a recovery the auction failed to get bids on many properties. According to the Florida Association of Realtors—the Sarasota/Manatee area once again outsold the Miami and Ft. Lauderdale markets, which continues the trend for every month of 2007 and 2008. It appears the home sellers in the Miami area need to be punched in the nose with a dose a reality.

Sarasota market recovery

SKY Sotheby's had an outstanding first quarter in terms of transactions. Many of our listings have gone under contract and we represented numerous buyers in the purchase of a property.

Sarasota is recovering faster than other Florida real estate markets. Too bad the national media paints the entire Florida real estate market with one broad stroke.

This market has become more affordable again. Back in 2005 if you wanted to get a condo on the beach side of the road on Longboat Key, Siesta Key or Lido Key you would pretty much have to pay at least $500,000. Now, there are options out there under $400,000. I know of a condo on Lido Key under $350,000.

In 2005 you would have to pay at least $400 a square foot for a Downtown Sarasota condo. Now there are options out there at $250 a square foot.

Want a house under $150,000? You have 659 to choose from in the Sarasota MLS.

Want a gulf front condo under $500k? You have 68 to choose from on Siesta, Lido and Longboat Keys.

Want a house built within the last 5 years in the Sarasota area under $350k? There are 175 of them to choose from.

Want a condo built within the last 5 years on the barrier islands less than $2 million? You have 43 to choose from.

We are affordable again. I see the light at the end of the tunnel. The Sarasota MLS shows 747 homes and 309 condominium under contract. The downward movement on price is turning to go sideways.

Florida home sales show some resilience

The Florida Association of Realtors issued their statistics for February home sales for Florida.

Sales in the Sarasota-Bradenton market dropped 10 percent when comparing February with the same month a year ago. The number of homes sold dropped from 672 to 608.

Only two Florida markets improved from February of 2007: Fort Pierce-Port St. Lucie was up 4 percent while Fort Myers-Cape Coral, a market that had the highest per-capita number of foreclosures nationally in February, was flat at 445 sales.

Prices fell 25 percent in Sarasota-Bradenton and 20 percent in Charlotte County-North Port. While sounding drastic, it was at roughly the price range that houses have held for months.

The $254,200 February median in Sarasota-Bradenton compares with $246,300 in January, $246,900 in December and $267,700 in November.

Here is an interesting statistic:
Sarasota-Bradenton's 608 sales were more than all but three of Florida's 20 largest markets: Jacksonville, Orlando and Tampa-St. Petersburg-Clearwater.

According to FAR there were only 244 homes sales in Miami. For such a large market that is amazing. I sometimes wonder about the accuracy of these numbers.

Here is some valuable information from the real estate veteran Howard Rooks of Rooks-Morris brokerage firm. "I have seen many, many cases where properties are worth less two or three years later," he said. "But they've always been higher five years later. We are going into our third year of a tough market now."

Homes are becoming affordable again. The Sarasota MLS shows 645 homes for sale under $150,000. Someone can buy a beach front condo under $500,000 again. Want a winter condo getaway in a downtown Sarasota? You can get one under $400,000. Want a condo with gorgeous water views? I just saw one close in Condo on the Bay for $340,000.

International Exposure

Looking for some international exposure for your home? With the U.S. dollar so weak and our correcting real estate market we are getting a lot of interest from Canadians and Europeans. This is a fabulous time for them to buy.

I was perusing through my website statistics yesterday to see how many visitors I had from foreign countries. In the last 30 days my Sarasota real estate website had visitors from 99 different countries. I had a visitor from Togo who stayed on my site for 25 minutes. Togo is a country in West Africa (I had to look it up). Below are the number of visits for the top 10 countries:

• 2,516 Canada
• 838 United Kingdom
• 162 Germany
• 119 France
• 85 Denmark
• 78 Sweden
• 73 Japan
• 71 Netherlands
• 70 Czech Republic
• 55 Ireland

Contact me at 941-812-6272 if you need to sell your home and want extensive internet and international exposure.

Nobody is Buying in Florida

Untrue!

The Sarasota MLS shows that there are:

733 single family homes under contract
311 condominiums under contract

Contrarian: An investor who buys a category when most others are selling and sells when others are buying. A contrarian doesn’t chase what is hot, but is often buying a category that has recently underperformed.

If you need help buying or selling please contact me at 941-812-6272.

House Price 'Bubble' Now Deflated

According to a new study by SMR Research Corporation the housing "bubble" -- whose bursting triggered the current mortgage credit crisis -- has now fully deflated.

This sets the stage for a mild housing recovery, which SMR said would begin prior to year end 2008.

The recovery is likely to be gradual, with house prices merely firming up or increasing slightly, rather than returning to the strong growth they showed from 2002 to mid-2006, the firm said.

SMR specializes in mortgage and home equity loan industry research. An SMR study was among the first to declare (in 2002) that a housing price bubble existed, defined as prices rising faster than consumer incomes. In a 2004 study, SMR forecast that a "perfect storm" in credit quality would cause an explosion in foreclosures within two years.

"Our prior forecasts were accurate but widely disbelieved when issued," noted SMR President Stuart A. Feldstein. "We similarly expect a skeptical reaction now to a recovery forecast, which is not the common view. But the numbers are what they are."

The new recovery forecast was published within SMR's annual Spring study on mortgage industry trends and leading players: Giants of the Mortgage Industry, 2008. More than 230 pages this year, Giants has been in continuous publication since 1986.

A special section in the study used home price and consumer income data from several sources to show how the bubble grew from 2002 to 2006. The same data now show the bubble has evaporated at current mortgage interest rates after 18 months of rising incomes and falling home values.

"Homes are now affordable again," Feldstein said. "Consumer psychology is the biggest remaining hurdle to recovery."

Prospective home buyers, still hearing predictions that prices will fall further, keep waiting to buy, SMR noted. This becomes a self-fulfilling prophecy, as scant demand pushes home prices lower.

"The stage is set for recovery, but the play won't go on if no one buys a ticket," Feldstein said. "Consumers must believe prices have bottomed out, or nearly so, before they will buy in larger numbers."

SMR noted that home price depreciations always do come to an end eventually, as occurred over the last 20 years in California, New England, New York, and Hawaii. Falling mortgage interest rates could trigger the end of this one.

The recovery in housing will be tempered by three negatives, SMR said.

First, borrowers with low credit scores may be unable to participate. Second, existing home owners who owe more money than their homes are worth may find it difficult to move until prices firm up.

Third, there is another type of housing "bubble" that may still exist, SMR said. It is the difference between home purchase downpayments and household savings.

SMR cited IRS data showing a big increase over 10 recent years in the percentage of tax filers reporting zero taxable interest income, implying no available cash savings. It is more difficult and expensive today to get 100% home purchase financing, so most buyers must have some downpayment funds.

Still, even though these problems will make the housing recovery modest, they will not prevent it from coming, SMR said.

In its analysis of the house price/income bubble, SMR used gross household income data from the Census Bureau as well as per capita disposable incomes from the Commerce Department's Bureau of Economic Analysis.

The firm used house price data reported separately by the Census Bureau on newly constructed homes and from the National Association of Realtors on existing homes.

In addition, SMR compared income trends to required average monthly mortgage payments under prevailing annual interest rates from 1990 through February, 2008. Results showed that gaps created from 2002 through 2006 are now closed.

SMR's annual Giants study also includes the firm's complete coverage of full-year 2007 mortgage originations and servicing data by lender and for the industry, plus new measures of loan delinquency, foreclosure, and other industry and company statistics.

Founded in 1984, SMR Research Corp. is the nation's largest provider of industry research studies on mortgage and home equity loan subjects.

February Sales

Here are some sales figures for February 2008 and February 2007. I pulled these numbers from the Sarasota MLS. The areas included in the totals are for Longboat Key, Siesta Key, Lido Key, Bird Key, Casey Key, Lakewood Ranch, Sarasota, Osprey and Nokomis. All other areas were exluded.

February 2007
Total single family homes transactions: 180
Total condo transactions: 215

February 2008
Total single family homes transactions: 170
Total condo transactions: 93

February 2007
Longboat Key homes: 5
Longboat Key condo: 14

February 2008
Longboat Key homes: 7
Longboat Key condo: 14

February 2007
Siesta Key homes: 7
Siesta Key condo: 11

February 2008
Siesta Key homes: 5
Siesta Key condo: 12

February 2007
Lido Key homes: 0
Lido Key condo: 1

February 2008
Lido Key homes: 1
Lido Key condo: 5

February 2007
Casey Key homes: 1

February 2008
Casey Key homes: 2

February 2007
Bird Key homes: 1

February 2008
Bird Key homes: 1

February 2007
Lakewood Ranch homes: 23
Lakewood Ranch condo: 12

February 2008
Lakewood Ranch homes: 31
Lakewood Ranch condo: 3

Pending Transactions - These are all of the properties in the areas mentioned above that are currently under contract and waiting to close.

Total single family homes: 421
Total condominiums: 225

Longboat Key homes: 9
Longboat Key condos: 38

Siesta Key homes: 18
Siesta Key condos: 41

Lido Key homes: 3
Lido Key condos: 2

Casey Key homes: 3

Bird Key homes: 4

Lakewood Ranch homes: 46
Lakewood Ranch condos: 10

Realtors throwing in the towel

Membership in region's largest associations affected by housing slump

With the housing market flat, Southwest Florida real estate agents are retreating or quitting the business in large numbers. The Sarasota Association of Realtors is down 11 percent over last year; the Manatee County association 19 percent; and the Punta Gorda-Port Charlotte-North Port Association of Realtors 11 percent.

The Sarasota association's membership peaked with the real estate boom. In 2005, the group had 4,300 members. That has dropped to 3,600, says Kathy Roberts, the association's chief executive officer.

The ranks of the parent Florida Association of Realtors swelled by 25 percent in 2004 alone. As the market contracted -- and with it Realtors' pay stubs -- many in the industry have adopted other lines of work to supplement their income.

It is sad to see Realtors giving up on the profession but too many of them came in when the business was easy. Right now, this profession is difficult. The sellers think every offer is too low and that their home is worth more than it really is. Buyers think they are doing the sellers a favor by purchasing their home and they always want to pay less than the property is worth. Mortgages are tougher to get. There are tons of people looking at property but waiting to time the bottom perfectly before buying. Realtors are complaining, attorneys are complaining, title people are complaining, inspectors are complaining, mortgage professionals and banks are complaining. I can see why some Realtors are looking for greener pastures.

Here are a few tips on choosing a Realtor to work with:

Experience - Make sure your agent has closed some deals. I don't consider years in the business a good measure of experience. I have met so many agents that have been in the business for 10 or 20 years but really aren't all that experienced. In a market like this experience goes a long way.

Full Time - Is your agent full time? How can a Realtor effectively market your home or help you buy a home when they have another job taking up the majority of their time? I'm not trying to throw the part timers under the bus but servicing customers properly can take a lot of time. I believe the overall customer experience is better when you are working with a full time, experienced agent.

Communication - Make sure you pick a Realtor that you can talk to and who listens to your needs. You might be working with your Realtor for months or years depending on whether you are buying or selling. Good communication in the process is crucial. Make sure your Realtor is accessible. That does not mean you should bother your Realtor every second of the day but make sure they call back in a timely fashion.

Just Sold - River Club

A client of mine just purchased this gorgeous home in River Club. The home has 4 bedrooms, den, 3 bathrooms with 3,523 square feet and sits on almost an acre.

Property description:

Beautiful Todd Johnston custom home on a private almost one acre lost in the estate section of River Club. Upgrades throughout the home including crown molding, 14' ceilings, cherry cabinetry, granite wet bar, wine refrigerator, columns in foyer and dining room, marble fireplace and custom built-ins. The sales price (now public record) was $620,000.

If you need help selling your home or want me to represent you in a purchase please contact me at 941-812-6272 or email me.

Zell predicts housing recovery in spring

Real estate billionaire Sam Zell, chairman of Equity Group Investments, suggested the housing market will begin its recovery this spring.

"I think (housing) starts have already pretty much bottomed out," Zell told CNBC Tuesday. "I think sales will start to occur, and we'll start to clean up the inventory."

Here is a link to the Chicago Trubine article.

For those who don't know. Sam Zell is a billionaire and real estate entrepreneur. He is co-founder and Chairman of Equity Group Investments, a private investment firm and has an estimated net worth of $6 billion dollars. Zell also owns Tribune Company, the publisher of the Los Angeles Times, the Chicago Tribune, New York Newsday and owner of the Chicago Cubs.

Ignore the Headlines

I read an interesting article from TIME magazine last night. Here is a link to the article.

I am going to cut and paste the article below:

Famed Money Manager is perhaps best known for his timeless wisdom that you can beat the pros by focusing on stocks of companies where you either work or shop or have some other edge. But a more relevant Lynchism today is this gem: Ignore the headlines.

That's no easy thing. How do you tune out all the chatter and ink on recession, housing, subprime woes, the credit crunch, rogue traders, insolvent bond insurers, $100 oil and nukes in Iran? It's enough to make you sit on your thumbs and wait before making any big moves. But what, exactly, are you waiting for?

There has rarely been a moment in history when you couldn't scare yourself into doing nothing. And yet, as Lynch observed nearly 20 years ago, "in spite of all the great and minor calamities that have occurred ... all the thousands of reasons that the world might be coming to an end--owning stocks has continued to be twice as rewarding as owning bonds."

A top reason to not buy stocks, in Lynch's view, is if you don't already own a home--in which case, that should be your first investment, since an owner-occupied home is nearly always profitable. Through a spokesman, Lynch reaffirmed these views to me--housing debacle and all.

When prices are falling, few people have the discipline to buy stocks, a house, gold, art or any other asset. But those who do pull the trigger excel in the long run. As John D. Rockefeller famously said, "The way to make money is to buy when blood is running in the streets."

And the streets are stained crimson. Start with stocks. They have been pummeled this year. GDP braked sharply last quarter, and there has been plenty of panic about a recession. The Federal Reserve is slashing short-term interest rates at the fastest clip in decades. But if you stick to your steady, diversified plan while everyone else is retreating, you will be happy years from now. For one thing, Fed rate cuts always lift the economy eventually, and the stock market typically starts responding just as headlines get gloomiest. Sure, the market could fall again before recovering. But the recession may be half over already--or we may avoid one altogether. You just never know.

As for housing, certainly some skepticism is in order. Formerly sizzling markets in Florida, Nevada, Arizona and California probably haven't seen the worst headlines just yet, though they may well be close. And "jumbo" mortgages, those more than $417,000, are likely to remain artificially high for a few more months while banks work through their credit issues.

But let's say you are emotionally ready to be a homeowner. You have good credit, plan to stay put for five years and have been waiting for the perfect entry point. It's time to get serious--before an inevitable rise in interest rates wipes out your advantage. "The thing that will make home prices stop falling is the very same thing that will push mortgage rates higher," says Jim Svinth, chief economist at mortgage firm Lending Tree. So anything you gain by a further drop in prices might be offset by rising financing costs.

Consider a typical home that sells for $218,900. You put down 20% and get a 30-year fixed-rate mortgage at today's rate of 5.5%. Monthly principal and interest come to $994.31. Let's say that 12 months from now the same house goes for 10% less, or $197,010. But by then the recession is history and the Fed is jacking up rates to stem inflation. If mortgage costs rise just half a point, to 6%, your monthly payment would be $994.94 and you'd have saved nothing. Meanwhile, home prices might steady and sellers might become less willing to negotiate. And you have spent a year living someplace you'd rather not be.

It's more complicated if you must sell before you can buy. But that logjam won't persist forever--and if it appears you'll be trapped for a few years, try to refinance at today's lower rates. Risks always seem most acute when the headlines give you ulcers. But that's exactly when you should think long term--and get off your thumbs.

The Case Against Waiting to Buy

Today's Home Price - $218,900
Put 20% down and get a 30-year fixed-rate mortgage
5.5% Current rates after recent declines
Monthly payment $994.94

Cost in 12 months?
If prices drop an additional 10% home price will be $197,010
Recession ends, and the Fed starts to raise rates - Interest rate 6%
Monthly payment $994.94

CONCLUSION: If you waited a year to buy, you would have saved nothing and spent a year living someplace you'd rather not be.

Vulture funds looking at Florida real estate

I have been in touch with a few private equity firms looking to make a bulk purchase of property in the Sarasota area. There are alot of "vulture funds" or "opportunity funds" looking to pick up Florida real estate at depressed prices. They typically seek out hurting condo developers who are sitting on a ton of inventory and make offers to purchase condos in bulk at reduced prices. Once they purchase them they typically rent them out for several years.

The money comes from all over. Basically, these private equity firms or vulture funds are just a group of wealthy individuals pooling their money together to purchase in large quantity. Buying in quantity allows them to get a price discount and better returns on their money. I even read that Jack McCabe, the economist who spoke in Sarasota last week, has created a McCabe Acquisitions LLC to purchase distressed property.

This can be a good thing for the market. In a market like this reducing inventory levels will lead to a more balanced market. Demand will increase because buyers will be less apprehensive about the market.

While our inventories are hovering around a historic high we appear to be in a better situation that south Florida. I recently heard that there were 24,000 condos for sale with another 19,000 new condos scheduled to be completed soon.

Here are a few of the buildings where the developer is still trying to sell units.

Alinari
Broadway Promenade
Rivo on Ringling
Kanaya
Positano
1350 Main
Phillippi Landings
Bel Mare at Riviera Dunes
Promenade at Riverwalk

I am forgetting a few but this is the bulk of them. We appear to be in much better shape than south Florida.

SKY Sotheby's Spring Auction

SKY Sotheby's is pleased to announce the date of our Spring 2008 luxury portfolio auction. The event will take place Friday April 11, 2008 at The Longboat Key Club. This time we are allowing only 50 luxury properties in the auction. More information: SKY Sotheby's Auction

Buyers

Sellers

For more information email marc.rasmussen@skysothebys.com or call me at 941-812-6272.

93%

In December of 2007 the average sales price to list price ratio was 93% for single family homes and 91% for condominiums.

Here is a run down of 2007 statistics.

Single Family Homes
January - 91%
February - 90%
March - 93%
April - 93%
May - 92%
June - 92%
July - 93%
August - 93%
September - 92%
October - 93%
November - 91%
December - 93%

Condominiums
January - 93%
February - 94%
March - 94%
April - 97%
May - 92%
June - 94%
July - 93%
August - 92%
September - 91%
October - 92%
November - 90%
December - 91%

These statistics are the sales prices versus the last list price. Not the original list price.

Don't list your property unless you are truly motivated to sell it

I turned down another listing yesterday. I hate to turn down the possibility of making a buck but the best advice I can give to many potential sellers is to not list. If you are unmotivated to sell there is a slim chance your property will sell. In most cases, you have to be the best property at the best price in your market segment. You have to be the bright flower in the field of weeds.

Another problem with a bunch of overpriced properties on the market is that it affects our supply statistics which in turn affects our demand. Newspapers often report that there is enough property on the market to last several years. This kind of stuff scares buyers into not acting. If you are a possible buyer and you read in the newspaper that the Sarasota real estate market has a 3 year supply of properties for sale that is going to make you think twice.

There will always be overpriced properties on the market. That will never go away. We had them in a strong market and we have much more of them in a weak market.

If you are thinking of selling your property hire an appraiser or a competent Realtor to give you a realistic valuation. You will save yourself a ton of headaches. Be objective about your property and put yourself in the buyers shoes. Visit other like kind properties to compare. The value of your property does not have anything to do with how much you owe on it, how much your friend "thinks" it is worth (unless they want to buy it) or what it appraised for 2 years ago.

Can you imagine what our inventory levels would be if Realtors stopped taking grossly overpriced listings?

"You can buy Florida real estate at 50 cents on the dollar"

I am a little tired of reading the doom and gloom articles about the Sarasota Florida real estate market. A client from Canada sent me an article from one of his newspapers about the Florida market. Like so many other articles it talks about how bad it is here. I am not saying these reporters are completely wrong. But some of them are blowing things out of proportion. One of them stated that you can buy real estate here for 50 cents on the dollar.

The reason I bring this up is because I had a client over the weekend who wanted to put in a rediculously low offer on a home that is already priced well. When I checked the recently sold homes in the community the home they were interested in was within 10% of those prices. My client wanted to submit an offer of about 60% of list price. After analyzing the recently sold homes in the community he agreed that there was little chance of getting the home at that price.

The December statistics from the Sarasota Board of Realtors show that the average sales price to list price for sold properties is 90%. In November it was 93%. January numbers should be out soon. Over the last year it is consistently between 90%-93%.

I checked MLS for all of the single family home and condo sales in January for Longboat Key, Siesta Key, Lido Key, Bird Key, Casey Key, Lakewood Ranch and Sarasota. In this specific area there were 247 sold properties (don't confuse these numbers with all of Sarasota county).

Of the 247 properties:

6 properties sold from 66% - 74% of list price
241 properties sold 75% of list price or over
81% of the properties sold for more than 85% of the last asking price
59% of the properties sold for more than 90% of the last asking price
24% of the properties sold for more than 95% of the last asking price

It is not all sunshine and rainbows out there but it is not as grim as some believe. Arm yourself with the facts not the opinions of a reporter spouting doom and gloom in an effort to sell newspapers.

Good news:

Currently there are 468 properties under contract in the area I mentioned above.

There are 697 properties under contract in the Sarasota MLS. Not all of the Manatee county transactions are reported in the Sarasota MLS so this number will actually be larger.

Good news for the real estate market

I was trading emails with a potential buyer from England today. As you probably know the Euro is very strong against the dollar. For Canadians and Europeans Florida is turning out to be the perfect storm for them. Prices here are down significantly and their currency is very strong against the dollar.

One of the comments I found interesting was, "I find the prices in Sarasota amazing! We should all move to Florida."

Foreigners are interested in our real estate market

Prices are down 30%-40% since the market highs of 2005

Mortgage rates are low

Lenders are loosening up credit just a bit (but not too much)

An administration change in Washington will increase confidence with many Americans

There is pent up buyer demand

Home construction is very low meaning few new homes added to the market

With the volatile stock market some people will put their assets in real estate

Property tax relief on the way

Inventory of Sarasota Homes and Condos

I had a request from my blog reader Todd for the latest inventory levels. He requested inventories for October, November and December. Unfortunately, our MLS system does not allow us to go back in time like that so I can only give today's numbers.

If you look at the right side of this page you will see a log of Sarasota home and condo inventory levels. The latest figures from the Sarasota MLS are as follows:

January 25, 2008
Single Family Homes - 5,056
Condominiums - 3,426

I originally displayed the trendgraphix chart of inventory but it was a little skewed as there were a large number of properties that expired the last day of the year. Apparently, most of them have been relisted. I wish we could chart the inventory levels of sellers who were priced within 5%-10% of market value.

While inventories are still high there are pockets with a limited number of properties. Take a look at the condo on Longboat Key that I mentioned in the post below. If you were a buyer for a beach front 2 bedroom, 2 bathroom condo on the south end of Longboat Key with an unobstructed view of Gulf of Mexico under $1 million dollars you only have about 17 condos in 8 complexes to choose from.

I was out with a client yesterday looking at downtown Sarasota condos. My client wanted a quality newer building, between $1 and $1.5 million, a view of the bay, 2+ bedrooms, 2+ bathrooms. There are only 16 condos that currently fit and I can eliminate most of the 16 units for various reasons. He really did not have much to choose from.

Some friends of mine wanted to purchase a small rental for a long term investment. We started working out the details of our offer when the listing agent called to tell me that they already sold the home that day.

Properly priced homes will see action. People are starting to see value again. I have sold 4 properties since the beginning of the year. All of my buyers needed to get a sense of value before they got off their check book. Those of you trying to sell right now should objectively compare your property to your competition. Make your property the best value by improving it and/or pricing it better.