"What we have here is a failure to communicate"

Total confusion?

This guy was playing in front of me the last time I played golf at Cocoa Beach (A beautiful 27 hole public course)

I have been reading an endless supply of opinions on the state of the Real Estate market. I think a lot of people just chose a side and stick to it until it doesn’t work anymore. I personally feel that nobody really knows. There are always means to manipulate statistics to support your argument.

Selling Real Estate

I have seen that there still are a lot of agents and companies that follow the opinion of NAR (National association of Realtors) and FAR (Florida association of Realtors). As far as I know NAR and FAR don’t sell real property. I am a member of both associations and they do good work at what they do. They provide excellent education for Realtors; they have standards of ethics that we are all held to as Realtors. They promote the Real Estate market in general. No one likes to see people quit the business but it is happening and that means less dues paid to both associations. I think it has been proven recently that no group can turn or influence the Real Estate market not even the FED. I believe that “what we have here is a failure to communicate” (Cool Hand Luke), the market is going through a market correction and it is very hard on sellers, investors and Real Estate agents. It is a natural occurrence and as hard as it is to bear, it has to happen. If it never happened then no one would be able to buy a property in years ahead. If we had continued to see property values increase 20% a year then consider this; a home bought in 2000 for $150,000 would sell today for $644,944. Now that would mean that you could own a nice little 3/2 1500 sq ft for $644,944.

We recently closed a short sale on a never lived in luxury town home. It was purchased pre-construction in 2005 for $299,900 as a flip. It closed last week for $195,000! This is an extreme example but that is what is still happening in the market today.

Repeat business and referrals

As a smaller company we depend heavily on repeat business and referrals, we really have to try our very best to perform for both buyers and sellers to get the good word out there. We can’t afford to count on a buyer coming in and making a purchase and then we will never see this person again. We have to have satisfied customers and usually they become friends. We don’t get some listings or we can’t take these listings because of price and expectations. We market our listings heavily and do whatever it takes to get them seen. When they are priced at the owner’s price rather than the market price it usually results in bad feelings by both. I think the best way to do this type of listing is to try it at the owner’s price for 30 days then lower to the market price if the owner agrees on this strategy.

I am convinced the most creative people in the world work for bumper sticker companies, send me your favorite and I will post it.

Jim Bagwell

Happy Valentine Week

Valentine week update

Hope all is well with everyone and we appreciate all your comments and suggestions.

If you are looking for a bigger home on the water, we may have one more possibility. A home on a very nice canal in a very nice neighborhood has been reduced $100,000. It is now listed at $699,900, this home started out at $890,000. The home that was a foreclosure one street over will sell for around $550,000 but needed a lot of work. This home appears to be well maintained with around 3500 sq ft, great pool, covered boat house, new a/c’s, 5 bedrooms, 3 baths, etc. If you could get this home for around the mid $600,000 range it would be a better deal than the foreclosure.

This week’s summary

There were 7 closings this week in the Cape Canaveral and Cocoa Beach area. None of the sales really got my attention as a real deal. Please keep in mind that to get a really good deal you have to do your research and validate your offer. We usually take a day at least, to formulate the right approach to submit the contract and cover letter to the listing agent and hopefully they will share the package with the seller. We have at least 2 closings next week that are very impressive and I will share these when they close.

Buyer’s market?

Regardless of what you hear from large Real Estate Corps and organizations like FAR, NAR and the Mortgage Broker associations; we are still in a buyer’s market and will be all year. In my opinion 2008 will be a better year than 2007 because of reduction in sale prices. I feel that 2009 will be a better year for the sellers but only if they stay realistic about the price of the property. In the Cocoa Beach area we are seeing new condo complex’s being reduced by $100,000 per unit, reason for the reduction is obvious. They were totally unrealistic in the pricing of the units and in my humble opinion they still are overpriced. It is not the buyer’s problem that the developers paid too much for the land and the builders paid too much for the construction. For an inexperienced developer I believe you should start small while you learn the market.

Stay in touch and we will share more info later.

Jim Bagwell

Cocoa Beach, Good Morning!

Cocoa Beach , Good morning !

In our Sunday morning paper real estate section we had a guest columnist. I have a lot of respect for this broker and she is very successful at what she does. To paraphrase, she thinks that our market in Brevard County has reached the equalization point or that property prices are such that low offers will no longer work. I would love to believe this theory but it is just too much of a generalization. Certainly there are homes and sellers who have reached their bottom price. Some sellers are bringing significant money to the closing table; there is only so much money to bring to the table so these people are at the bottom. There are many more properties still at 2005 prices and if they don’t negotiate then they will not sell the property. You still have to have a very active agent to explain to you as a buyer that each property and each seller are in very different circumstances.

State of the Market

At the present time there are 6,394 single family homes on the market in Brevard County. 64% of these are priced between $100-300,000. During the past year there have been 4977 homes sold in Brevard County. 76% of these sold between $100-300,000. In the condo market there are presently 2772 condo/town homes on the market. 54% of these are priced between $100-300,000. During the past year there have been 1237 condo/town homes sold, 65% of these priced between $100-300,000.

Buyer’s Market

This period we are in is still very much a buyer’s market. The market may be moving toward equalization but it is not there as yet. To give you some examples of what I am speaking of consider the following:

Recently there was a direct river home sold for $450,000. This home is a 4 bedroom 2 bath home that definitely needs updated but it sits on .33 acre with great views of the islands in Cocoa Beach. This home was listed at $599,900 and sold for $450,000.

A luxury condo on the intracoastal waterway, the Indian River, over 2200 sq ft, this unit was purchased in 2005 for $543,900 it is now under contract with a list price of $375,000.

Buyer’s market, I think so!

It could be the time to make a offer on your dream!

Real Estate Excitement ?

As you can imagine we haven’t had much to be excited about running a Real Estate Brokerage during the last two years. We have started 2008 in a very positive manner. All our agents are showing property and closings are happening in a very regular time period. I believe prices are driving this cautious comeback. I still take what NAR and FAR puts out with a grain of salt since their business is to pump up Real Estate Agents and the public about the market. You will never see me wear the button that says “It is time to buy Real Estate” however in 2008 you may see me wear a button that says “It could be the time to buy depending on the price”.

Market update

So far in 2008 there have been 26 condos sold and 8 single family homes. Some of my favorite deals were as follows:

1800 sq ft condo top floor with ocean and river views. This unit needed updated but sold for $350,000. It was listed originally for over $500,000. (there is now the next door unit listed for $399,000, the seller will have to look at what sold next door)

1153 sq ft daily/weekly rental unit direct ocean, already leased Feb & Mar for $3000 monthly. This unit sold for $260,000.

Very new lake view unit, 1698 sq ft unit sold for $195,100 fully furnished.

2nd floor corner unit with great views, 1600 sq ft with a huge wrap around balcony sold for $269,900. Great building with fantastic lobby.

On the residential side of things there was a sale of a canal front home, sold less than a year ago for $450,000 and then completely renovated. This home sold this year for $450,000.

Some of the deals that are scheduled to close in Feb are even more impressive. I will post when they are actually closed.
My favorite listings
Some of my favorite units listed would be as follows:

My own listing is a beautiful home with 5 bedrooms 3 baths, fantastic pool, 2 docks,2500 sq ft and over 120’ of waterfront. This home has been totally redone and listed at $599,000 which is a loss to seller.

Another one of our listings is a 3/2 canal front home with a huge Florida room, dock with boat lift, landscaped to the 9’s. Just move in and enjoy, convenient to everything shopping, schools, dining, beach and everything else. This home has been reduced to $479,000.

Thank you for your time and we would love to work for you!