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Focusing on the Small Picture

At Michael Saunders & Company, one of our chief responsibilities is to keep clients and customers completely abreast of important trends affecting real estate in our local market areas.  Lately, we’ve noticed a nagging trend that challenges our ability to do this.  That trend is how utterly confusing contradictory media coverage of the housing market must be to buyers and sellers trying to make sense of it all.

Admittedly, local markets in recovery are notorious for sending out mixed signals as they re-establish their stability.  But in real estate one thing is for sure.  One size doesn’t fit all. There really isn’t one national real estate market to speak of.  So before moving ahead with the purchase or sale of a property, buyers and sellers must truly grasp the concept that every real estate market is wholly local and unique unto itself, extremely complex in nature and perhaps even subject to many markets within a market. The media would do well to constantly remind their audiences of this important, game-changing fact.

In relatively short order over just the past six weeks, headlines pertaining to the state of our local real estate market have featured such conflicting statements as:

  • “Home Building in Southwest Florida on the Mend” – July 12

….vs… “Home Construction Sinks to Lowest Level Since October” – July 20

  • “New Home Sales Drop Sharply” – July 21

…vs… “Strong Showing in Area Home Market” – July 23

  • “Housing Market Slows as Buyers Get Picky” – June 17

…vs… “Is a Housing Shortage Looming?” – June 20

Toss in a mixture of starkly contradictory national reports—some even released on the same day—and today’s market seems that much more baffling. Case in point:  Last week CoreLogic reported that May’s home prices increased for the fourth straight month, while the International Monetary Fund warned of a possible double-dip recession for housing. Got that?

So what’s a buyer or seller to do with all this clashing information?

For one thing, put it aside and do your own fact finding.  That way you won’t be hamstrung by one or more contradictory bits of information—much of it generated by the mainstream media—that have planted in the minds of so many consumers the misconception that the U.S. real estate market is uniformly depressed.   Local market trends for Southwest Florida, in fact, bespeak just the opposite condition; of month after month of rising unit sales, of steeply declining inventories and of bottoming prices that now appear to be trending upwards throughout many local segments of our recovering market.

These trends are surprisingly easy to spot using Trendgraphix, the industry’s leading source for unbiased market reports based on actual monthly closed market sales and pendings.  Trendgraphix is an indispensible tool that Michael Saunders & Company places at the instant beck and call of every one of its agents, clients and customers.  Your agent will be glad to help you interpret the latest market conditions for whatever area or price range you may be interested in.  After all why depend on questionable out-of-market sources—or national real estate web sites—when actual recaps of our market’s latest sales trends, each graphically depicted for ease of interpretation, are at your fingertips?

To develop the truest picture of trends in your geographic area of interest may even require drilling down to the neighborhood level.   Though housing prices, like other commodities, are completely dependent on supply and demand; this can fluctuate significantly right down to the neighborhood level.  Based on recent transactions, the number of competitive homes for sale and a host of other intangibles, one neighborhood may actually be appreciating in value while an adjacent one is still experiencing price declines.  That’s how micro a market can be, and why it pays enormous dividends to work with a competent neighborhood professional.

With area home prices at their lowest level in more than a decade, and interest rates among the lowest in history, now is certainly the right time to buy in Southwest Florida; provided your circumstances comfortably permit doing so.  Nationwide sales may have fallen in June by 5.1 percent, but they “soared” in Southwest Florida—according to the Sarasota Herald-Tribune—rising 35 percent in Sarasota-Bradenton and 44 percent in Charlotte County-North Port.

Therein lie all the reasons why it is counterproductive to speak about real estate on any sort of national level.  By focusing too much attention on the big picture, you just might miss the one that really counts.  The small one.

  • User Gravatar Michelle Carter
    July 29th, 2010

    Great post! And so true. Thank you for the reference to our reports. We work in more than 60 markets across the country and barely one of them conforms to national norms. Even within these markets are smaller, micro-markets, that differ from what’s going on regionally. Being able to look at the data from a local, even neighborhood, level is critical.

  • User Gravatar Karen Eastman Bigos
    July 30th, 2010

    Great article and so true. Our market in North Jersey has train line towns doing very well and some neighboring communities struggling with an abundance of inventory and much lower prices/higher taxes. Even in the same counties of NJ the markets have very different stats. The media is writing so many conflicting articles it is hard to know what is true. Thanks for sharing this interesting perspective. I will work on something similar for my market area.

  • User Gravatar Tampa Homes
    August 3rd, 2010

    Everything always comes down to an almost microscopic level. It’s the best way to see what matters – in almost any regard. It can be a difficult task considering that level is affected so directly by the big picture. Very nice article.

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