I was off showing property last weekend and again on Monday. Nothing to show for it yet, but that seems to be the business norm these days. A few prospective purchasers are looking, but few are actually buying (not that uncommon in the summer, but even slower than usual this year).
I heard the same yesterday at our monthly Sanibel & Captiva Islands Association of Realtors monthly membership meeting and our Thirsty Thursday (evening) networking session with our Realtor affiliate members. The general theme is that a few seasoned colleagues are out showing or working with clients who are considering buying or moving up, just not many are making it to contract (thought they think they will eventually). Affiliates are seeing business pick up with owners again making property improvements, remodeling and building.
Unfortunately, it seems that colleagues new to the business are struggling as there seems to be little action from new visitors. Rather, most sales are coming from referrals (we got two new ones this week) or island owners who already love it here and recognize that the time is right. That has been the tone elsewhere too.
I will be attending our Florida REALTOR® annual meetings next month so have been receiving more info lately describing the state-wise business picture. Many Realtor® associations throughout many states are losing members as the economic/housing issues affect their business.
The SanibelSusan Team remains thankful that we continue to have a terrific year. Our 2011 Sanibel annual production stats were updated again this week, and though I have dropped from 3rd to 4th in total sales volume, it still is a very respectable position (out of 296 Realtor® members. That is a drop in our membership too. It seems like just yesterday, we had 330+ Realtors on Sanibel & Captiva.)
Below are this week’s island and real estate tidbits, followed by a summary of showing of the island MLS action since last Friday. Unfortunately there was not much activity.
Shell Harbor and Sanibel Estates Canal System
City Council on Tues established a special assessment district to fund future dredging of the entrance to the canal system near the Sanibel Marina. Dredging was done earlier this year. Since 1995, the same area has been dredged seven times, with the next project scheduled for 2013 at a cost of $33K. Under the special assessment formula, the City pays 1/3, the marina pays 40%, and the homeowners pay the rest. For each owner, it will amount to $20/year. This assessment will allow the City to control when the work is performed; however, a separate assessment would be needed if future canal soundings find that the internal canals need dredging.
Sanibel City Budget
Also on Tues, City Council left until later in the budget process the question of further paying down the liability on two pension funds (the general employees’ pension fun and the police pension fund) or the sewer debt or both. In recent years, declining property values have reduced tax revenues, but this year taxable values leveled off with only a slight drop from last year. Before further discussion at the next budget session slated for Sept 10, Council has asked staff to bring back further data, however, in her budget message, City Manager, Judie Zimomra noted that “City salaries remain flat for the 4th consecutive year; full-time employees total 114, down from 142 in 2007; health care costs for employees are contained at current levels; the proposed budget would pay down the pension plans’ unfunded liability by over $2.5M; with the exception of sewer rates, all other City fees are held flat; and $2.8M is allocated toward general government capital improvements (including $1M of capital projects rolled over from the prior years).”
Big Mortgages Are Back
I belong to LinkedIn which posted a good article last Saturday in the “Wall Street Journal/Weekend Investor”. Much of that article relates to financing of high-end property and describes how jumbo loans are cheap historically now, compared to conventional loans. Interesting how low interest rates are driving high-end buyers to supersized mortgages “at a pace unseen since the housing boom…. So-called jumbo loans—generally those bigger than $417,000—are a better bargain now than they have been in years…. Not only are jumbo loans cheap relative to historical rates, they are cheap relative to smaller “conforming” loans, which are backed by Fannie Mae, Freddie Mac and federal agencies. The difference between the rates on a jumbo mortgage and a conforming loan is just 0.43 percentage point, the narrowest spread since 2007. That makes borrowing bigger amounts more attractive than it has been in recent years, and also presents opportunities for buyers who might have been previously locked out of pricey markets due to higher rates…Jumbo loans accounted for almost one in every six new mortgages, including new-home purchases and refinances, in the first quarter of 2011….At that pace, the number of jumbo loans issued in 2011 could be the highest in five years, when the housing market was near its peak. That is in part because people are trying to lock in a government-backed jumbo loan now ahead of a planned limit reduction. Starting in October, the federal government will start easing its support of jumbo loans as large as $729,750, which it began as an emergency measure three years ago. The new limits will vary by location, but will drop to $625,500 in top-tier markets such as New York, Los Angeles and Washington, D.C. Many potential buyers are trying to take advantage of substantial price declines of expensive homes over recent years…. That includes people who bought well before the housing bubble and who are still significantly above water now and want to trade up while prices are low. Other prospective buyers who sat out the boom but stayed employed and saved money during the downturn now have money for pricier houses, and the jumbo loan is their ticket in. Depending on location, jumbo loans typically require a down payment of 20% to 30%”…. But borrowers should act quickly. Since lenders won’t be able to sell as many jumbo loans to government-backed agencies—thereby unloading risk—they may not originate as many…. What’s more, the added risk means they likely will raise their interest rates. The upshot: buyers could have fewer choices and face pricier loans…. Still, some housing analysts say that with the government out of the way, more lenders will eventually start competing against one another—perhaps as early as next year. The renewed competition could result in easier lending standards over time.”
Banks Must Get Back to Business
Another good article posted by the National Association of Realtors® Chief Economist, Lawrence Yun, looks differently at the broader picture and does not have quite as positive a spin as the article above. Here are some excerpts: “You (Realtors®) already know from real-world experience that banks are not lending. But now your experience is backed by hard data from the FDIC. The agency found that in the year ending March 2011, bank deposits rose by $300 billion, assets grew by $80 billion, and profits were up by $12 billion. Yet loan volumes fell $260 billion to $7.24 trillion. The banking industry’s old “3-6-3 rule” says that bankers pay 3% interest to depositors, make loans to depositors at 6%, and be out on the golf course by 3 p.m. That rule now seems to be replaced with a new 0-0-3 rule: Offer nothing to depositors and nothing to those who want to borrow, and earn 3% by buying tradable assets like government bonds. To be sure, profit is not a bad thing. But when banks accumulate profit at the expense of doing what they’re in business to do – make loans – they put brakes on the economy. We might already be seeing the consequences with the economic recovery showing signs of sputtering….What’s…likely (to happen in the months ahead) is that any additional price contractions will be modest. Home values have already fallen considerably, to historically justifiable levels. And in areas where jobs are strong, prices are solid or heading up. But the lesson is clear: A return to banking the old fashioned way can speed the housing recovery.”
Ten Signs Your Property May Be Overpriced
I cannot resist posting this article since it is so “right on”. It was posted this week on Realtor.com and written by a Realtor® from North Windham, CT, with her “10 ways to determine if your property may be priced too high for the market:
10. You priced along with other homes listed for sale, rather than homes that had actually sold.
9. Despite the fact values have fallen all over town and continue to decline, you believe this doesn’t apply to your home.
8. You priced your home based on how much you spent improving it.
7. You priced your home based on an appraisal from well over 3 months ago.
6. You believe your house is “unique” and different from all other homes, despite its similarities in size, age, condition and location to other homes. You believe your homes “uniqueness” warrants a higher price than all those other homes.
5. You sincerely believe that if you just stay on the market for long enough, eventually that one “right” buyer will come along, fall in love with your house and pay whatever you’re asking.
4. Despite many showings, no one has made an offer on your home.
3. Your home has been on the market for a very long time…6 months…12 even.
2. Your Realtor didn’t agree with your pricing, or worse – the original Realtor wouldn’t list your home at “your” price so you had to search for someone else who would.
1. You are getting NO SHOWINGS. This is the number one sign that your home is overpriced. If it’s been marketed, but no one is interested in coming inside, the market has already rejected your home at its current price.”
5 new listings: Captains Walk #B6 1/1 $175K, Blind Pass #E102 2/2 $439.9K, Sand Pointe #132 2/2 $599K, Sundial #A301 2/2 $949K, Sanddollar #B104 2/2 $995K.
4 price changes: Sundial #D207 1/1 now $237,750; Coquina Beach #5A 2/2 now $329K; Sandalfoot #3D1 2/2 now $500K, Pine Cove #1A 2/2 now $799K.
1 new sale: Sanctuary Heron #2B 3/3.5 listed for $619.9K.
2 closed sales: Loggerhead Cay #101 2/2 $611K, Pointe Santo #E41 2/2 $860K.
1 new listing: 3705 West Gulf Dr 5/5.2 $3.499M.
6 price changes: 480 Peachtree Rd 3/3 now $574.9K, 1328 Seaspray Ln 4/4 now $649K, 4215 Gulf Pines Dr 5/3.5 now $679K, 1019 Lindgren Blvd 3/2 now $739K, 947 Lindgren Blvd 3/2 now $749K, 1301 Par View Dr 3/3 now $999K,
4 new sales: 617 Lake Murex Cir 3/2 listed for $585K, 676 Anchor Dr 3/3 listed for $819K, 827 Angel Dr 3/2 listed for $850K, 720 Birdie View Pt 3/3 listed for $949.9K.
2 closed sales: 1431 SandCastle Rd 3/2 for $665K, 722 Sand Dollar 3/3 for $1.06M.
3 new listings: 3001 Poinciana Cir $159K, 1304 Eagle Run $320K, 5044 Joewood Dr $545K.
No new listings.
2 price changes: Tennis Villas #3229 1/1 now $235K, Tennis Villas #3120 1/1 now $237,750.
No new sales.
1 closed sale: Bayside Villas 4212 1/2 $255,750.
No new listings or price changes. 1 new sale: 15557 Captiva 5/4.5 listed for $2.99M. 1 closed sale: 16227 Captiva 5/3 $1M.
Nothing to report.
This representation is based in whole or in part on data supplied by the Sanibel & Captiva Islands Association of Realtors or its Multiple Listing Service. Neither the association nor its MLS guarantees or is in any way responsible for its accuracy. Data maintained by the association or its MLS may not reflect all real estate activity in the market. The information provided represents the general real estate activity in the community and does not imply that SanibelSusan Realty Associates is participating or participated in these transactions. If your property currently is listed with another broker, this is not intended as a solicitation of that listing.
I hope your weekends are great ones. Our island temps are expected to continue in the high 80’s/low 90’s days, mid 70’s at night. Funny how this month we have northern visitors come to Florida to say cool. It would be nice if that would also spark a little real estate activity. Until next week, Susan