This week, the rainy weather experienced on the islands last week turned around, with hot sunny days in the low 90’s and just an occasional quick shower. If you are here on vacation this week, it’s a winner weather-wise!
Florida schools go back early with teachers in Collier starting on Monday, Lee the following week, so it is pretty much a summer wind-down beginning here. Many condo fall projects already are beginning and restaurants/shop workers are talking about when they will be closing for their pre-season breaks.
Vacation rental bookings have dwindled down too and will continue for the next few weeks until we see the snowbirds start to come back, usually mid-October.
The good news is that although there is not much real estate activity now, the buyers who are here looking, generally are serious.
There was no Realtor® Caravan Meeting this week, but The SanibelSusan Team had a handful of showings and another closing. The activity posted in the Sanibel and Captiva Multiple Listing Service over the last seven days, follows a couple of news items.
If you are on our mailing list, this week we mailed an island inventory booklet dated July 22, 2015. It is organized by island (Sanibel and Captiva) and property type (condos, homes, lots) and subdivision/complex. Included are the properties for sale and recent sales. If you want to be added to our mailing list, please call 888-603-0603 or 239-471-HOME (4663), or email Susan@SanibelSusan.com.
Where Do Buyers Come From?
“Getting involved in your community once only meant volunteering for a civil group, joining a sports club, or running for local governance. People stayed connected through face to face interactions. In an industry like real estate that thrives on friendly interactions and personal connections, building online communities through websites, social media, and digital communication is now one of the most efficient ways that REALTORS® can build and expand their network to generate new business.
“The majority of business for real estate professionals comes from referrals and repeat business, which makes sense since the industry is built upon personal relationships. At first, the idea of expanding online communities to grow the real estate industry seems like a no-brainer. All businesses these days rely on digital connectivity or they get left behind. The National Association of REALTORS® (NAR)’s Research department flipped through its survey data to take a deep look at how its members value online communities for their business. Here is what the surveys said:
“The NAR 2015 Member Profile, an in-house survey that gathers demographic data on its 1 million real estate members, reports that:
- 65% of REALTORS® use social media for their business.
- 64% said that open houses brought no business.
- 40% of business for younger agents are from referrals and repeat business and 64% for more experienced agents.
“Naturally, word of mouth remains the largest source of income for NAR members and only grows by the number of years REALTORS® stay in the game. What is interesting to note is that open houses are almost a dead avenue for REALTORS® – they brought two-thirds of NAR members no business. Websites do not appear to bring in new clients on their own. However, two-third of members said they actively use social media as a means to market their brand and showcase their listings.
“The NAR 2014 Profile of Home Buyers and Sellers, NAR’s profile of the buying and selling process, states that:
The first step in the home-buying process for 43% of home buyers was looking online for properties and 12% looked online for information about how to buy a home.
“Ninety-two percent of buyers use the internet in some way in their home search process and 50% of buyers use a mobile website or application in their home search.
“Real estate agents were viewed as a useful information source by 98% of buyers who used an agent while searching for a home.
“Eighty-eight percent of buyers purchased their home through a real estate agent or broker—a share that has steadily increased from 69 percent in 2001. As a frame of reference, in 1964, 61% of buyers contacted agents, 40% read newspaper ads, and seven percent drove around when looking for a home. In 2014, 43% looked for properties online. While the initial process may start online, when buyers seek to make a home purchase, they turn to the advice from a real estate agent that they connected with from a trusted friend or family member.”
Sanibel Considers Increases for Beach Parking, Rec Center Fees
From the “Santiva Chronicle” on Tuesday, August 4, 2015:
“Beach parking prices and Recreation Center fees are about to go up on Sanibel. The Sanibel City Council will consider an ordinance at its September meeting that would raise the hourly fee for public beach parking from $3 to $4. Also to be considered at that meeting will be an ordinance that would raise fees for the various programs at the Sanibel Recreation Center in a range up to 20%.
“Both ordinances were proposed at the council’s meeting Tuesday, Aug. 4, as part of ongoing process of finalizing the 2016 fiscal year budget. “It’s important that taxpayers of Sanibel, the ones who are here all the time, not pay for increases in tourism on the island. The tourists should pay,” said Vice-Mayor Mick Denham, who moved to have the parking fee increase come before the council in September in the form of an ordinance. Beach parking fees pay for beach related expenses and Denham said the increase could be used to fund beach erosion projects, security cameras and other improvements.
““Beach parking pays for itself, but the beaches have other issues, like traffic and security,” Councilman Chauncey Goss said. He has advocated an increase in the parking fee since he came on the council this year.
“It’s a supply and demand issue,” Goss said. “If the beach parking lots are always full, then they may not be priced right.” “It’s a user fee, is what it is,” Councilman Marty Harrity said. “Let it pay for itself.” Denham urged that the council take Tuesday’s action in order to get the ordinance in front of the council in September for a first reading.
““Our population hasn’t changed. What’s changed is the number of visitors. It is reasonable to ask visitors to pay,” Denham said following the meeting. “We’ve already got $2.5 million going into our beaches, but that doesn’t pay for all of the expenses. We’ve got to live within our means.”
“Recreation Center – The council, at the urging of Mayor Kevin Ruane, sought ways of saving money at the Recreation Center and in response to that it received a report from Recreation Director Andrea Miller outlining ways to save $121,700. Among them is an across-the-board 10% increase in fees that would raise $60,000 more.
“Instead the council asked for an ordinance to be prepared that would evaluate programs at the Rec Center and determine appropriate increases in each up to 20%. “What programs are being heavily subsidized?” Goss asked. “We should identify those.”
“Presently the year individual rate for a resident is $157.50. A 10% increase would raise that to $173.25 and a 15% increase would take it to $181.13. “This gives us flexibility. Residents will still find that even with increases that our Rec Center is very competitive,” Ruane said.”
NAR Survey Finds Like-Kind Exchanges Promote Job, Economic Growth
According to a recent press release: “Real estate like-kind exchanges are an important vehicle for disposing of and acquiring properties and support the nation’s financial growth, job creation and economy, according to a new report from the National Association of Realtors®.
“The Like-Kind Exchanges: Real Estate Market Perspectives 2015 survey of NAR’s commercial and residential members found that real estate investors and commercial property owners place a very high priority on current like-kind exchange tax rules; 40% indicated that transactions would not have occurred in the absence of the tax provision, and 56% said even if the project would have occurred it likely would have been smaller in scale.
“Realtors® are active participants in like-kind exchanges; 63% of Realtors® participated in a like-kind exchange transaction between 2011 and 2015. The survey found that like-kind exchanges in which Realtors® participated created between 10 and 35 new jobs, mostly resulting from spending on building improvements following acquisition.
“”Like-kind exchanges that allow investors and businesses to defer capital gains taxes on the exchange of similar properties bring great advantages to investors, real estate markets and the economy,” said NAR Chief Economist Lawrence Yun. “Realtors® and their clients often look for better economic use of existing properties that are underutilized, which helps promote local economic development and increase the nation’s gross domestic product.”
“Internal Revenue Code Section 1031, a provision that has been in the tax code since 1924, provides individuals and businesses with critically needed tax deferment on gains after the disposition of a property as long as the proceeds are reinvested in a similar property through a like-kind exchange. Replacement properties must be identified in 45 days and the transaction completed within 180 days.
“Survey respondents said the primary reason that they or their clients participated in a like-kind property exchange, aside from the deferral of capital gains taxes, was for equity to acquire additional properties. Other reasons were for estate planning, portfolio diversification and completion of a development project.
The tax savings resulting from like-kind exchanges are also helping bring more capital into local markets. Eighty-six percent of respondents said the savings from tax deferment allowed them or their clients to invest additional capital and make improvement in their acquired properties; these investments are generally responsible for the creation of new jobs, such as in construction and property management.
“According to the survey, in 68% of like-kind transactions, Realtors® acted as a broker or agent, and 24% participated as an owner or investor in the transaction. A larger percentage of commercial members (76%) reported engaging in a like-kind exchange transaction compared to residential members (45%). Of the total, 40% participated in between 1 and 3 transactions, and 23% participated in 4 or more transactions.
Residential properties comprised the largest portion of recent deals, accounting for 27% of disposed properties and 24% of acquired properties, followed by apartments (17% of dispositions and 22% of acquisitions). Land assets accounted for 19% of dispositions and 17% of acquisitions; retail properties accounted for 8% of dispositions and 13% of acquisitions; and office buildings comprised 11% of dispositions and 10% of acquisitions.
“Investors tend to hold on to their properties for several years; 47% of respondents reported their holding period was between 5 and 9 years, and 27% indicated a holding period of 10 to 14 years.
“NAR believes like-kind exchange transactions are fundamental to the real estate investment sector, and repealing the tax provision would have negative effects across real estate markets and the industry.
“Like-kind exchanges help investors more efficiently allocate capital and resources with less borrowed money into new investments that drive economic activity in communities across the nation,” said NAR President Chris Polychron, executive broker with 1st Choice Realty in Hot Springs, Ark. “Any tax reform plan repealing like-kind exchanges would hurt investors and small businesses, increase financial leverage, weaken growth and the economy, and result in the loss of jobs.”
“Survey respondents indicated that repealing like-kind exchange tax provisions would reduce equity in real estate; 67% indicated repeal would lead to a large increase in financial leverage. Realtors® said the negative result would be reduced purchase money and new construction loans, and increased property holding periods. Ninety-six percent of Realtors® also said real estate values would decrease if like-kind exchange provisions were repealed….”
Sanibel & Captiva Multiple Listing Service Activity July 31 to August 7
No new listings.
1 price change: Sanibel Inn #14 2/2 now $739K.
1 new sale: Captains Walk #F7 2/1.5 listed at $310K.
3 closed sales: Captains Walk #F6 2/2 $285K, Sunset South #9C 2/2 $425K (our listing), Sundial #R304 2/2 $735K.
1 new listing: 249 Daniel Dr 2/2.5 $834.9K.
3 price changes: 999 Sand Castle Rd 3/3 now $547K; 9032 Mockingbird Dr 3/2 now $549,999; 1188 Harbor Cottage Ct 3/3 now $899,555.
2 new sales: 1744 Bunting Ln 4/2 listed at $649K, 734 Sand Dollar Dr 3/3.5 listed at $1.195M.
1 closed sale: 1521 Wilton Ln 3/2 $520K.
1 new listing: 5821 Pine Tree Dr $599K.
No price changes or new sales.
1 closed sale: 4626 Buck Key Rd $178K.
No new listings.
1 price change: Beach Villas #2618 2/2 now $659.9K.
1 closed sale: Lands End Village #1660 3/3 $1.35M.
Nothing to report.
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 general real estate activity in the community and does not imply that SanibelSusan Realty Associates is participating or participated in these transactions.
Until next week, Susan Andrews, aka SanibelSusan