The Saunders Blog

The Neighborhood Report – Bird Key

Surrounded by sparkling waters, Bird Key is considered the jewel of Sarasota Bay.

Considered the jewel of Sarasota Bay, Bird Key is perfectly located in the middle of Sarasota Bay between St Armands Circle/Lido Key Beach and downtown Sarasota. This manmade island is made up of 511 lots, or approximately 460 single-family homes, with the only other occupant being the Bird Key Yacht Club. The original island had a large home built on it in 1914, which was owned by a couple from Cincinnati. Since then, John Ringling bought the island, which then became home for his sister. In 1950, Arvida Development Corp—with the assistance of the Corp of Engineers—designed and built the current island.
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Market Activity – Bird Key

There are presently 39 active listings in Bird Key. Of these, 11 are off-water—known as Garden homes—15 are canal homes, and 13 are set on Sarasota Bay.

Garden homes range from $515,000 to $1,399,000; Canal homes range from $1,195,000 to $2,695,000; Sarasota Bay homes range from $1,499,000 to $9,490,000. There are five pending homes, in which two are Garden homes, two canal homes and one bay front home. In the last thirty days, one home has sold for $495,000. Year-to-date, fifteen homes have sold—ten of these were off-water; four were canal homes and one bay home. (more…)

Chicken or Egg?

photo courtesy of dannyfranks.wordpress.com

Like the classic conundrum involving which came first, the chicken or the egg, here’s a question that never fails to ignite debate at cocktail parties everywhere:

Which matters more when selling a home?  The agent you select to help you accomplish the feat; or the company he or she works for?

Needless to say, there are no definitive answers to these questions because no two transactions ever involve the exact same set of circumstances.  Sometimes an agent’s track record of success helps attract a seller, while the company’s reach, reputation and resources help bring in the buyer.  One thing, however, is for sure in today’s unforgiving market. Whether you personally place more emphasis on the agent than the company he or she represents—or vice versa—there has never been a more critical time to weigh the merits of each very carefully before deciding with whom to list your home.

As a company dedicated to exceptional service, we naturally think that clients and customers are deserving and entitled to both—a great agent backed by the resources of a great company.  After all, at each closing, both agent and company receive just compensation for having done their fair share of the heavy lifting.  Moreover, a talented and resourceful agent is of much greater value to you when backed by a company that injects even more resources into the customer service equation.

At Michael Saunders & Company we go to tremendous lengths to make sure the agents we put in service to you can do much more than simply produce a valid real estate license and occupy a desk.  Although we have many of the market’s leading neighborhood and property specialists, we are determined to be known for the quality of our agents, not the quantity.

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Taming the Beast

The road to recovery for Southwest Florida’s real estate market has been long and arduous; fraught with an overabundance of properties for sale—many of them short sales and foreclosures.  Yet following a winter in which sales of correctly-priced homes sizzled, even the most skeptical market watchers are trading die-hard pessimism for a healthy dose of informed optimism.

Prices are at long last stabilizing on properties priced below $300,000.  The total number of properties for sale has retreated into a much healthier zone of balanced supply and demand; and the phenomenon of multiple offers on well-priced properties is not uncommon.  The market for correctly-priced properties between $500,000 and $1 million has also begun to show signs of a slow recovery—although sales of properties above $1 million remain sluggish.  Still, were it not for the 800-pound gorilla occupying the driver’s seat, some might conclude that our overall recovery is finally cruising in the fast lane.

That 800-pound gorilla is the beast called “foreclosure,” a tenacious problem applying considerable drag to the pace of our recovery.  Yet, while the total number of foreclosures in Sarasota, Manatee and Charlotte Counties has essentially remained flat over the past few months, the number is still high—9,844 at last count in March—and could potentially get higher before subsiding.  That’s the sobering news of the day.

But there’s good news too.  Unlike earlier in the crisis, newer foreclosures are being handled somewhat more proactively by the major financial institutions, who now realize that it’s often in their best interest to strike constructive accords with “underwater” borrowers at risk for defaulting on their loans. With so many foreclosures exerting downward pressure on prices, everyone’s bottom line is better served by keeping home and homeowner together wherever possible.   Thus, the result of a constructive give-and-take between borrower and lender increasingly comes in the form of a loan modification or principal reduction plan, which typically reduces principal and payments for the borrower while keeping the property lived-in, cared for, and of greater value to the lender.

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To Buy, Or Not To Buy (with apologies to WM. Shakespeare)

With the nation’s housing market behaving most untraditionally over the past few years, many would-be buyers are understandably scratching their heads, wondering if the right time to buy is now.

From strictly a local market perspective, the answer to this frequently-asked question is an enthusiastic—if qualified—“yes.”  Having been among the first regions in the nation to experience the full brunt of the housing bubble—and its all-too-familiar aftermath—Southwest Florida is now ahead of the curve with respect to its recovery.  More than two years of aggressive price reductions have recently restored some semblance of local stability to our market; while nationally, sales took an unexpected dip this winter—largely attributed to weather that prevented buyers from leaving their current homes to shop for new ones.

In Sarasota, Manatee and Charlotte Counties, on the other hand, the weather stopped no buyers from making their appointed rounds.  Unit sales are up, pending sales are up dramatically, inventories have been reduced, and our market’s median price, no longer in freefall, is bobbing up and down marginally from month to month—traditionally a symptom of firming-up prices.

Thus, all indicators of a sustained recovery are evident throughout the region as we wrap up the first quarter of 2010.  Add two seriously attractive purchasing incentives to the mix—the first time home buyer tax credit and historically low interest rates—and you’ll understand why so many people feel it’s now or never if buying at rock bottom prices is priority one.

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The New Normal

Across virtually every segment of the economy, 2009 sputtered-in as miserably as 2008 sputtered-out.  Yet in spite of its many challenges, the past year showed that it’s better to light one candle than to curse the darkness.  For if the experiences of 2009 taught us nothing else, we learned that true professionals united in common cause can truly make good things happen.

That’s how agents from Michael Saunders & Company helped re-awaken the region’s comatose housing market in 2009.  United in purpose and armed with statistics to prove the point—they were able to educate sellers to the new realities of a market in which competitive pricing is key.  Of course, it never hurts that ours remains Florida’s top destination for a lifestyle rich in world-class cultural and recreational amenities.

With corrected prices now the accepted norm and the popular first-time homebuyer tax credit renewed for another six months, buyers have rushed in and put the market on the fast track to stability.  They’ve driven up year-over-year the number of home sales by as much as 63 percent, according to the most recent monthly MLS sales recap for November.   As a company, Michael Saunders & Company is proud to announce that our agents finished 2009 with over $1 Billion in closed dollar volume and exceeded our 2008 production.  It took 30 percent more transactions to accomplish this uphill feat, but lowered prices proved the catalyst by which buyers were finally heartened to return to the market.

Even as the S&P 500 gained over 69% from its annual low, holiday sales rose and the consumer confidence index improved over 40% in 2009, economists are dubbing 2010 a “Tabletop” year for the real estate industry.  This means that having clawed its way back to a sustained level of sales activity, our market will continue in something of a horizontal recovery; without any major setbacks or much in the way of noticeable price appreciation, until the job market picks up and the inventory of properties—especially foreclosures—drops off. With unemployment showing signs of slowing, we are beginning to see the impact of our stimulus dollars at work.

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Recovery By Extension

This is an audience participation post in which you are invited and encouraged to weigh-in with your opinions on one of our region’s most pressing economic issues.  But first, read on.

Counting today, there are just 30 days to go before the first time homebuyer tax credit expires.  For all intents and purposes, if you haven’t gone to contract on a home by now you probably won’t complete your purchase in time to qualify for the credit.

That’s bad news for many qualified buyers who have been in the market for months only to be frustrated at every turn by a system that refuses to budge.  Perhaps they’ve been denied financing due to an incompetent appraisal by an out-of-town appraiser.  Perhaps the appraisal was accurate, credit scores were good, but the lenders simply refuse to lend.  Or perhaps they’ve been on the buyer side of a short-sale where the seller and the lender have been locked in limbo for six months or more.   For these reasons—and because the tax credit has had such a positive impact on our market—we join Congress in its support for extending the deadline at least another six months.  There’s agreement on both sides of the aisle—and among leading economists—that a recovering housing market is the prime catalyst that will lead the rest of the economy out of the wilderness.

The tax credit has been so effective in stimulating sales and stabilizing home prices that continuing it seems like a no-brainer in light of a housing market that still exhibits contradictory signs of recovery.  Secondly, a significant new wave of foreclosures is in the pipeline that could easily undo much of the progress that has been made toward reducing inventory and firming-up prices.  One of the key benefits of the tax credit is that it ignited a firestorm of sales that has helped shore-up home prices in spite of the unprecedented number of foreclosures and short sales.

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The Two-Minute Warning

Photo Credit: smh.com.au

Hard to believe, but only two months remain before the November 30^th deadline for earning the First Time Home Buyers Tax Credit. While that may still seem like quite a ways off, if you’re planning to join the 1.4 million American families who have already taken advantage of this popular incentive—but have yet to zero-in on a property—you may very well find yourself in a sprint to get your purchase in under the wire.  This is not the sort of last-minute shopping that can be crammed into the few waning days before the cut-off date.

Even though the term First Time Home Buyer has been broadly interpreted to empower more people to qualify for the credit, if you truly are a first-time buyer you may not be fully aware of the time it takes to complete a real estate transaction.  At this late date, you will ideally want to have your home picked out by early-October in order to close on it by mid-November; with an extra cushion of time left over to deal with any last-minute details.

Once you’ve found the right home, your work has just begun.  In order for mortgage funds to be available at the time of closing, you must obtain a satisfactory credit report, a competent home appraisal, a commitment for home insurance, a complete home inspection and verification of personal data.  Add to this the fact that you will not be alone in trying to accomplish all these musts as the deadline begins to loom large.  Realtors, lenders, title companies, home inspectors and certified appraisers will no doubt be swamped by the last minute rush; in much the same way as car dealers were bombarded with buyers and a blizzard of paperwork as the Cash for Clunkers automotive incentive program entered its final days. (more…)

Fuzzy Math

In case you missed the news—which is highly unlikely if you looked at TV, listened to the radio, read a newspaper or browsed the web in the past week—Florida has allegedly lost population for the first time since World War II.  A huge problem, the journalists all agree, since the Sunshine State historically relies on steady growth to fuel its economy.  (Doesn’t everyone?)

It must’ve been a slow news week.  The media sank its teeth into this particular item like a pit bull on steroids; reporting it in such somber tones you could almost hear the death knell in the background.  Please observe a moment of silence, it tolled. Florida has passed.

Here, for example, is how the New York Times reported the news:

Choked by record level of foreclosures and unemployment, along with a helping of disillusionment, the state’s population declined by 58,000 people from April 2008 to April 2009, according to the University of Florida’s Bureau of Economic and Business Research.  Except for the years around World War I and II, it was the state’s first population loss since at least 1900.

“It’s dramatic,” said Stanley K. Smith, an economics professor at the University of Florida who compiled the report.  “You have a state that was booming and has been a leader in population grown for the last 100 years that suddenly has seen a substantial shift.”

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The Faces of Foreclosure

After noting all the recent snippets of good news about the economy apparently inching its way toward recovery, one is almost tempted to chill the glasses and ice the champagne.  Having ridden the doom and gloom express for more than a year, the media is suddenly the good news bandwagon; positively tripping over each other to report all the positive developments on the economic front.  The stock market is running with the bulls again.  New home sales rose more than expected in June; while existing home sales rose for the third consecutive month.  Nationwide—as in Southwest Florida—inventories of available homes are easing and prices are declining less sharply.  Consumer spending is up for the second straight month; and construction spending rose for the second time in three months.  Moreover, the government’s gross domestic product report shows that the economy shrank at a one percent annual rate in the second quarter of 2009; which doesn’t exactly sound all that good until you realize that the numbers are a vast improvement over similar figures released earlier this year.  Although the pundits sound nearly unanimous in their view that the deepest recession since the Great Depression is winding down, most of this good news has actually been delivered imbedded in what normally passes for bad news.

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Fighting Back Against Foreclosure

It will come as news to virtually no one that home foreclosures are among the most challenging and heartbreaking problems facing Sarasota County families as they struggle through one of the worst economic meltdowns in our nation’s history.  What largely began as a problem affecting investors and homeowners—who could no longer afford the sub-prime mortgages that were so freely and irresponsibly parceled out during the boom—has morphed into a much more all-encompassing crisis.  Today a lost job—or even a temporary layoff—can be the final straw that pushes responsible homeowners to the brink of having to surrender their homes.

Where homeowners threatened with foreclosure once had few options but to pack up, vacate the family home and relocate elsewhere, Sarasota County and the Community Alliance of Sarasota County are taking fresh steps to minimize such drastic and distressing outcomes.  If the threat of foreclosure is on the horizon by far the worst thing imperiled homeowners can do is throw-up their arms, throw in the towel and do nothing.  Doing so only complicates the problem when there are more positive and available options awaiting those who act quickly to pursue them.

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