Fact or Fiction

Are we seeing a stabilization of the market?


I recently read another MSNBC article that stated that foreclosures in July were up 55% over last July. I know there are an abundance of foreclosures all over the nation. I also believe that different areas have very different markets especially when it comes to foreclosures. Most if not all government relief programs are geared toward the primary residence owner and in my opinion rightfully so. Investors should be more knowledgeable about mortgages, interest rates and loan programs. They are also the first owners to bail since it is not their homes it is strictly business and I understand that theory.

What I did was research the last week’s sales and this I thought was fascinating. There have been 7 homes sold in Merritt Island and Viera areas during the last week. The interesting part of this is that of these 7 closings the sale price versus the list price was an incredible 95%. I must believe that these homes were priced right and the low ball offer didn’t work. These homes were priced from $99,900 to $309,900 so you see it was most of the middle consumer levels and only one of these homes was a foreclosure or short sale.

Does this mean market stabilization? I believe it shows that owners who price their homes to sell will still find a buyer and that some short sales and foreclosures are still priced too high.

There are still bargains galore if you are contemplating making Brevard your home.


Jim Bagwell

Love, love, love

Positive thoughts. I was out on the porch last night talking with my wife. Lightning was flashing over the ocean, surf was lapping and believe it or not a hawk was screaming. I just had an Epiphany that I had become much too negative. I will never go back to wearing pink pants but there are opportunities at our feet with the market we are in at the present time. We are working with a very good friend and his fiance at the present time to find them a home to buy at a good price naturally. We have recently closed their home for over $500,000, we are now looking for a home around $200,000. The choices are endless and of course you are hesitant to pull the trigger. If you are buying a home to live in then the market is not as important as if you are moving in a couple of years. The value is in the home itself and I guarantee that eventually the market will rebound, I just don't know when.

I don't really know when we evolved in this direction but negativity brings more pop and more readers, listeners and viewers. All you have to do is look at Rush Limbaugh and the huge contract he recently signed. The brilliance of this man is that he can't lose since you know he will have improved ratings if Obama is elected and he has already came out and said he doesn't support McCain. 4 more years of negativity guaranteed with higher ratings. So if you are against everything then life is very simple but not very fulfilling.

"Truth will set you free"

I firmly believe that all professions should always tell the truth about what the market is doing at the present time. This does not only apply to Real Estate, if you have a money manager then you know what I mean. If you count on one commission at a time with no regard to protecting your client then you are committing the ultimate sin and it will always bite you in the butt.

Merritt Island & Viera

There continue to be very good buys in this area of the market.

I noticed a 1700 sq ft home in Merritt Island 4 bedroom 2 bath with a new pool and completely upgraded. Priced at $209,900. I would expect to get this home under $200,000.

For you people over 55, there is a 1/2 duplex never lived in with over 1800 sq ft. This property was priced over $300,000 and is now $195,000.

A property in Sunset Lakes on Merritt is a great home, priced at $459,000. This home has over 3000 sq ft, great pool, 3 car garage and all the bells and whistles. It sits on 1/2 acre.

There is always a short sale. This one is on Merritt Island. It is a 2 story home with over 2000 sq ft, pool. Priced at $199,900, this could be a good buy with the appropriate inspections. Be very patient when presenting offers on short sales.

It is usually easy to tell your family that you love them but it is usually hard to tell a friend.

Next post I may be back to being cynical.

Jim Bagwell

Friends and other misconceptions

As you know I have always said to get a good agent who knows the market when making a Real Estate purchase. You have to be very diligent in order to be assured that you won’t pay over market value.

What I have not stated near enough is that you have to be just as diligent when shopping for a mortgage. Just as there are many properties that are overpriced for the market there are still many mortgage brokers who are still charging excess fees in order to inflate their profit. There is usually nothing illegal about these fees as the industry is being watched as never before. You just have to shop and make sure to look at your good faith estimate or get another opinion of someone you trust.

We are in the process of closing a single family home. The buyers are very qualified and decided to use VA as the method of mortgage. They decided to use a family friend as their mortgage broker. We asked to see a copy of their good faith, what didn’t sound right was the origination fee. The normal use of an origination fee is to buy down the interest rate of a mortgage. In this case the buyers were paying 1% origination fee and were receiving a higher interest rate that is available without the origination fee. This makes the closing costs for buyer much higher and the mortgage payment higher through the life of the loan. Luckily this was caught before we were all at the closing table.


Market News

Not many people realize that we have a lot of part time residents that do not reside on the beach. Merritt Island canal homes have become more and more affordable. A lot of full time Orlando residents are keeping homes on the canals to serve as a weekend, holiday getaway. They don’t have to trailer the boat over and can spend more time on the water. We will go over a few of these buys.

There are 2 possibilities in Diana Shores on the west side of Sykes Creek. This takes a little longer to get to the locks but it is a pleasurable boat ride to spend a day in the ocean. One of these homes is 3 bedroom 2 bath home with a 2 car garage priced at $315,000, the other is a 4 bedroom 2 bath home with a pool and it is priced at $389,000. Keep in mind that these are list prices and you won’t be offering full price, also make your contract contingent on the appraisal being at or above the purchase price.

The other 2 are on the east side of Merritt Island on deep water and a very short trip to the locks. Both these homes should accommodate larger boats. One is an almost new home with over 2200 sq ft, pool, 4 bedrooms and 3 ½ baths. It is priced at $579,000. The other is a home on the end of a cul de sac and has over 2700 sq ft, pool, 3 bedrooms and 3 baths. This home sits on a beautiful .79 acre plot and has great water views. The home is priced at $895,000.

Irritation

It totally irritates me that an agent will take a listing on a great property and then takes no pictures, too few pictures or crappy pictures. They are not doing their sellers much of a service.

Hit them long and straight!

Jim Bagwell