Archives June, 2009

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Caught By The Tide

Our special guest blogger, Nick Churton of Mayfair International Realty, London office offers a timely warning for those playing the real estate market in the UK (and elsewhere) this summer:

tidal-waveAnyone caught by a fast incoming tide will know the feeling. The children went off exploring caves and rock pools, and it was so nice sunbathing on the beach. There seemed plenty of time to get to safe ground before the tide turned. But really there wasn’t. The tide is no respecter of the tardy, the forgetful or the ignorant. It is a game of chicken with only one winner. King Canute taught the English that in the 11th century when he tried to turn back the tide. He failed.

The same has just happened in the real estate market. Those who were cleverly waiting for the market to bottom out may now be too late. In certain parts of the market the tide appears to have turned. Right now it seems as if many of the ‘steals’ have been stolen. The snips have been snapped up. Property going for a song has sung. The tide has turned and – like many who wait until the ebb’s final retreat – they may be taken aback by the speed and strength of the flood.

Those who wait for the bottom of the market are invariably too late. It is never a good plan to try and second-guess the real estate market. What nobody could have possibly foreseen was that there would be a dearth of good quality homes coming on to the market this summer. This has put a premium on the price of some of those that have come on. This must not be mistaken for an increase in property prices generally. We are too early for that. Indeed figures show a slight dip in prices in May But sellers of really good homes in very popular locations are in the driving seat for the first time in a couple of years. It is the first real sign of any sort of market recovery.

Much of the unsold inventory that has been on the market for some time is now changing hands. Figures show that asking prices and selling prices are converging. Sellers pricing their homes correctly and buyers with cash or increasing access to mortgage funds are clearing the backlog. Inevitably the banks will get round to mainstream lending again – once they have capitalised sufficiently. Then first time buyers will pick off moribund new-build apartments and houses that were caught at the high water mark of 2008. Then the market will really move from slow to full ahead.

So what should opportunist buyers do now that the market tide may be past its nadir? Well there may be fresh chances in the fall if the market does a double bounce – this is a possibility as reduced public spending, and higher unemployment and taxes seem unavoidable. But to be on firm ground act quickly before the tide does come in. After all, as any coastal vacationer will tell you, it is always better to be damp than drowned.

Mortgage Originations Are Strong

* News from our partner Wells Fargo

Market in Review: The Wells Fargo View

During the first quarter of 2009, the mortgage industry experienced strong origination activity due to a number of factors including the ongoing low interest rate environment, a drop in the national median home price, an abundance of homes on the market and new government programs that are available to encourage homeownership, as well as refinances.

According to Inside Mortgage Finance, mortgage originations increased by 71%.  In total, an estimated $445 billion of single-family mortgage loans were made.

Of the originations in first quarter, the May 29 issue of Inside Mortgage Finance showed that 78% of originations were for refinances and 22% were for purchase money mortgages.

Credit and financing options continue to be available to qualified borrowers. Consumers should be aware that when obtaining a loan, it’s likely they will be asked to verify their income, demonstrate a solid credit history, and bring a down payment to the table.

• According to results released by the National Association of REALTORS® on May 12, the national median home price of single family homes sold in the first quarter was $169,000, a 6.2% decline from fourth quarter 2008.

• In addition, the Center for Housing Policy recently reported that between 2007 and 2008, the income needed to purchase a median-priced home dropped in 194 of 199 metropolitan areas.

These factors appear to demonstrate that the tide may be turning and home inventories are stabilizing in some areas of the country.

Read Full Article Here

Romancing the First-Time Homebuyer

There’s an interesting scenario shaping up in the under-$250,000 price tier of the real estate market in Sarasota County.  Based on the current rate of closed sales of single family homes—as reported in the most recent TRENDGRAPHIX for May—the county has just a three to five month supply of similarly priced homes; its lowest level since the height of the boom in September, 2005.

Buyers, many of them first-time purchasers, are finally satisfied that the bottom of the market is here—or close enough—and are now more appropriately concerned about lowering their actual long-term carrying costs.  Taking advantage of the very real prospect of saving up to $8,000 by using the First Time Homebuyer Tax Credit—before it expires on December 1—is much more palatable than the uncertain prospect of saving a few more dollars on the purchase price a month or two from now.  It also avoids the very real possibility that interest rates could spike upwards again in the meantime.

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Market Maintains its Momentum as Southwest Florida Slows for the Summer

SARASOTA, Florida—(June, 2009)—“Its very heartening to see that the sales momentum that built so impressively during the first four months of 2009 continued to be strong even as we transitioned from the busy winter season into our customarily slow summer months,” said Michael Saunders upon examining the latest sales statistics for May, just out from TRENDGRAPHIX.. “With bottoming prices, low interest rates and extraordinary, limited-time-only buying incentives—like the First Time Homebuyers Tax Credit—buyers are expressing their confidence in the market by stepping up to buy wherever they detect the best buying opportunities.”

“Sales continue to be disproportionately clustered in the under-$300,000 price range, thanks to prices that have been impacted by foreclosures and short sales; but sales are also occurring in every price range where sellers wisely list their homes in very close proximity to what comparable homes are actually selling for,” Saunders added. “The most encouraging news from this new data is that closed sales, although down slightly in most cases for May in Sarasota, Manatee and Charlotte Counties—as would be expected as we enter the slow summer months—largely held their own compared with April; while pending sales are way up compared with last May. Further, with most of these pending sales set to close in the next 30 to 60 days, it looks like the trend toward improved sales, established early this year, will continue throughout the summer.” (more…)

Nationwide Uptick Tells Only Part of the Story

NAR’s report for May shows a nationwide uptick in the sale of existing homes and sited favorable affordability conditions and the first time buyer tax credit as the primary reasons:

Existing-home sales – including single-family, townhomes, condominiums and co-ops – rose 2.4 percent to a seasonally adjusted annual rate of 4.77 million units in May from a downwardly revised level of 4.66 million units in April, but remained 3.6 percent below the 4.95 million-unit pace in May 2008.

Read the full article here.

It is encouraging to see the continued trend – the first nationwide back-to-back monthly gain since September 2005 – and Michael Saunders & Company recently posted our own area trend report for Sarasota, Manatee and Charlotte counties. Unfortunately, month to month reports only tell a piece of the story. (more…)

The Twenty-Eight Percent Solution

The region’s beleaguered real estate market exhibits renewed strength with each passing month.  Practically no one, not even the most skeptical observers, will dispute that the market has perked-up considerably.   For most of this year, closed sales have steadily crept upwards, pending sales have taken a remarkable bounce; and the inventory of available homes has fallen-off sharply.

Buyers, once content to occupy the sidelines while prices remained in free-fall, have finally been jolted into action by prices that have not only leveled out but have actually begun to inch-up again in the under-$350,000 price range—along with (surprise, surprise) suddenly-rising interest rates.  They are also anxious to close on their desired property before the First-Time Homebuyers Tax Credit expires on December 1.   Something of a misnomer, the First-Time Homebuyer Tax Credit is available to anyone who hasn’t owned a primary residence in the past three years.

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Michael Yawitz of Michael Saunders & Company Earns Green Designation

Michael Yawitz, an agent with Michael Saunders & Company, has been awarded the National Association of REALTORS® Green Designation, the only such designation recognized by NAR. He earned the prestigious designation after completing 18 hours of course work designed to instill a comprehensive knowledge of green homes and building.

yawitz-michael_cmyk

Yawitz has been trained to understand what makes a property “green,” is prepared to help clients evaluate the cost/benefits of green building features and practices; and distinguish between industry rating and classification systems. As well, he can discuss the financial grants and incentives available to homeowners, and help consumers assess a property’s green potential.

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Say Goodbye to Your Rabbit Ears

Say goodbye to your rabbit ears… never again to be adorned with fistfuls of aluminum foil twisted in obscure ways to pull in the perfect TV signal…

Truthfully, most everyone removed rabbit ears from their living room décor years ago… Despite this, the PSAs over the past 6 months – about the change to digital – have been non-stop.

The Housing and Economic Recovery Act of 2008 was passed at about the same time the digital signal PSAs started. Also referred to as HERA, the provisions contained in the Act will change the way of conducting Real Estate business much like digital changed the way we receive TV signals. The following may serve as a PSA to everyone involved in the purchase of a home in the future. (more…)

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Lunch with Larry

No sooner had last Sunday’s column about the groundbreaking artistic collaboration between The John & Mable Ringling Museum of Art and New York’s Baryshnikov Arts Center gone to press than we received an eye-popping magazine called Perspectives in the mail.  We simply couldn’t put it down until we had read every one of its superbly designed and written pages.

Perspectives, is a twice-yearly publication of the Ringling College of Art and Design issued to its various constituents—including alumni, donors, civic leaders and others. With its contemporary design and engaging content, you couldn’t ask for a more striking visual reminder that one of America’s pre-eminent schools of art and design is right here in our own backyard.

Browsing the magazine made us enormously proud of the trails the students, alumni, faculty and administration of Ringling College are blazing across the cutting-edge of visual communications; and caused us to ponder—yet again—how very much indebted we are to the enduring cultural legacy of the college’s namesakes, John and Mabel Ringling.

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Agents from Michael Saunders & Company to Lead Area Chapters of the Rotary Club

KEN TORRINGTON AND KLAUS LANG, OF THE FIRM’S
LONGBOAT KEY SOUTH OFFICE, ARE INCOMING PRESIDENTS

Two agents with Michael Saunders & Company, both representing the firm from its Longboat Key South office, have been elected incoming presidents of two of the major Rotary Club International chapters in Southwest Florida.

Ken Torrington will lead the Rotary Club of Sarasota while his company colleague, Klaus Lang, is the incoming president of the Rotary Club of Sarasota Keys. Torrington is a twenty year veteran of Michael Saunders & Company.  He has been with Rotary International for four years and will be installed as president on June 20, 2009 at a banquet at Marina Jack.

Lang, an agent with the company for the past seven years, has been a Rotarian since the early 1980’s and has belonged to clubs in Africa, Europe and Asia.  His chapter, the Rotary Club of Sarasota Keys, will celebrate its 50th anniversary early next year during Lang’s term as president.

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