Tallahassee Real Estate

No Spam From This REALTOR®

Century 21 First Realty — Fri, 18 Dec 2009 06:53:40 -0600

I’ve had several people send me emails asking to subscribe to the Tallahassee Real Estate Newsletter because they weren’t receiving it even though they had filled out the subscription form. I then had to explain to them how the whole system works, and why we’ve implemented a third-party solution to distribute our newsletters.

Just a quick reminder: The Tallahassee Real Estate Newsletter goes out on Monday, so please take a minute to subscribe in the right sidebar of the Tallahassee Real Estate Blog.

The fact is, there are so many people sending us garbage via email that our “spam filters” are working overtime. I know that I personally get over 500 emails each day, so I appreciate some of the new technologies that allow me to verify that I really want to receive specific items.

Why Is There So Much Spam Anyway?

Chances are, you’ve been spammed before. Somehow, your e-mail address has found it’s way into the hands of a spammer, and your inbox is suffering the consequences. How does this happen? There are several possibilities.

Backstabbing Businesses
Businesses often keep lists of their customers’ e-mail addresses. This is a completely legitimate practice and, usually, nothing bad comes of it. Sometimes though, the temptation to make a quick buck is too great, and these lists are sold or rented to outside advertisers. The result? A lot of unsolicited e-mail, and a serious breach of trust. [CENTURY 21 First Realty will never sell your email address. We feel so strongly about this, we've even published our own Anti-Spam Guarantee]

Random Address Generation

Computer programs called random address generators simply “guess” e-mail addresses. Over 100 million hotmail addresses exist – how hard could it be to guess some of them? Unfortunately for many unsuspecting netizens – not too hard. Many spammers also guess at

“standard” addresses, like “support@yourdomain.com”,

“info@yourdomain.com”, and “billing@yourdomain.com.”

Web Spiders

Today’s most insidious list-gathering tools are web spiders. All of the major search engines spider the web, saving information about each page. Spammers use tools that also spider the web, but save any e-mail address they come across. Your personal web page lists your e-mail address? Prepare for an onslaught!

Chat Room Harvesting

ISP’s offer vastly popular chat rooms where users are known only by their screen names. Of course, spammers know that your screen name is the first part of your e-mail address. Why waste time guessing e-mail addresses when a few hours of lurking in a chat room can net a list of actively-used addresses?

The Poor Man’s Bad Marketing Idea

It didn’t work for the phone companies, and it won’t work for e-mail marketers. But, some spammers still keep their own friends-and-family-style e-mail lists. Compiled from the addresses of other known spammers, and people or businesses that the owner has come across in the past, these lists are still illegitimate. Why? Only you can give someone permission to send you e-mail. A friend-of-a-friend’s permission won’t cut it.

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Home Sellers Advised To Get Out!

Century 21 First Realty — Thu, 17 Dec 2009 07:40:50 -0600

One issue that comes up invariably when we are sharing home selling tips with property owners has to do with buyer viewings. Many home owners request to “be present” when potential buyers are looking at the home.

While there are many understandable reasons why a home seller would request this, we make it very clear that they need to be gone during a property showing.

Objections Are A Part Of the Home Selling Process

What many people (who do not sell for a living) don’t understand is that buyer objections are the real start of the selling process. They are an absolutely essential requirement to a successful home sale and without them, we are not likely to sell the home that we are showing.

It’s the introduction of an objection that can spark a flow of information that can help us further qualify a sales opportunity and better understand the needs and current motivation of the home buying prospect. For this reason, we work to embrace and understand the true objections the home buying prospect might be considering.

Click Here To See Why Being Gone Will Help The Buyer "Speak Up"

Housing Forecast Stronger In 2010

Century 21 First Realty — Wed, 16 Dec 2009 07:06:18 -0600

The National Association of REALTORS® recently released a few reports that I find interesting. First, they reported that there have been nine (9) consecutive months of gains for pending home sales, suggesting that the housing market is poised for significant gains:

The rise from a year ago is the biggest annual increase ever recorded for the index, which is at the highest level since March 2006 when it was 115.2. Lawrence Yun, NAR chief economist, said home sales are experiencing a pendulum swing. “Keep in mind that housing had been underperforming over most of the past year.

Based on the demographics of our growing population, existing-home sales should be in the range of 5.5 million to 6.0 million annually, but we were well below the 5-million mark before the home buyer tax credit stimulus,” he said. “This means the tax credit is helping unleash a pent-up demand from a large pool of financially qualified renters, much more than borrowing sales from the future.”

Pending Home Sales On The Rise In Tallahassee

When we look at a graph of daily new pending home sales in the Tallahassee MLS, we see that the Tallahassee housing market is trailing the national figures by about 5 months. Our pending home sales began rising in August of this year.

[click here to see why NAR 2010 Forecast Has Some Good News]

Clarifying What Real Estate Market Bottom Really Means

Century 21 First Realty — Tue, 15 Dec 2009 05:57:35 -0600

I received a great question from an active reader in the blog yesterday that made me realize that two definitions of the real estate market bottom are lurking around out there and that I need to provide better clarification about “which real estate market bottom” that I am referring to when I comment about the current state of housing market in Tallahassee.

When I refer to the state of the housing market, I am definitively referring to the number of home sales in Tallahassee over the past 365 days. By studying this “rolling average” of home sales, we are able to remove all seasonal effects from our data and thus we can tell the current direction of the real estate market.

Housing Market Bottom Reached In Tallahassee

When we look at the graph below, we see that the current trend is rising from what appears to be the lowest point home sales will reach (going all the way back to January 1991).

Again, it is too early to say that we have definitely seen the bottom of the housing market back in August, but it sure looks like things are going to turn out that way.

Another Way To View The Housing Market Bottom

But we had a great question from a reader who asked:

Thanks…so the upswing is not an upswing and under the current upswing we are still losing ground?

And that is when I realized that I needed to do a better job of clarifying my definition of the housing market bottom.

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[See how the Real Estate Appreciation Graph shows market bottom not yet found]

Obama To Simplify Short Sales And Foreclosures

Century 21 First Realty — Mon, 14 Dec 2009 06:59:04 -0600

As a follow-up to last week’s article about understanding the short sales process, I thought I would write about how the Obama Administration is trying to speed up the process with its Home Affordable Foreclosure Alternatives Program (HAFA). This program offers financial incentives to lenders, servicers, and even borrowers to utilize a short sale or deed-in-lieu of foreclosure to avoid a foreclosure sale.

Did you know that you can have the Tallahassee Real Estate Blog delivered to your email every time it is published? Just click this link for easy home delivery.

These HAFA alternatives are available for all HAMP-eligible borrowers who:

do not qualify for a Trial Period Plan
do not successfully complete a Trial Period Plan
miss at least two consecutive payments during a HAMP modification, or
request a short sale or deed-in-lieu

As is typical with government programs, this is all simply explained (note a trace of sarcasm) in an easy to read 43 page document that can be downloaded for your reading pleasure. For those of you (us) who prefer the shorter version, the summary is below.

HAFA Short Sale And Deed In Lieu Program

In a short sale, the loan servicer allows the borrower to list and sell the mortgaged property with the understanding that the net proceeds from the sale may be less than the total amount due on the first mortgage.

Generally, if the borrower makes a good faith effort to sell the property but is not successful, a servicer may consider a deed in lieu of foreclosure (DIL). With a DIL, the borrower voluntarily transfers ownership of the property to the servicer – provided title is free and clear of mortgages, liens and encumbrances (meaning this is not possible if there is a 2nd mortgage on the property).

With either the HAFA short sale or DIL, the loan servicer may not require a cash contribution or promissory note from the borrower and must forfeit the ability to pursue a deficiency judgment against the borrower.

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[click here to see 5 available HAFA documents for download]

Creative Thinking In Real Estate Requires Caution

Century 21 First Realty — Fri, 11 Dec 2009 07:11:33 -0600

Not all situations in real estate sales have the same solution, and many times we have to apply some “thinking outside of the box” solutions to our home buyers’ needs.

Just yesterday, I received the following question from a “home site” buyer in Georgia who needed some advice on creative financing:

I am in a situation right now where I’d like to buy a land lot in Georgia to build on within the next year. The lot we want is $45000 and all the lending institutes I’ve spoken with want 25-45% down no matter what our credit is. By the way, our credit is good. We have plenty of money to make the monthly payments, but we don’t have the money necessary for the down payment. Also, we will be getting a construction loan in the next 6-9 months that will then pay off this land loan and add it into the new mortgage to include the house. This lot has been on the market for a long time and is a bank owned foreclosure. We were hoping to get a loan with 0-3% down and the seller pays all closing costs. Do you have any suggestions? Please email me with your response. Thanks!

So, by the numbers, I think the important points of the question are:

Reader has good credit
Reader has good income (can make monthly payments)
Reader has limited cash (cannot make large down payment)
Lot is owned by bank (bank foreclosed upon the lot)
Reader wants to start building in 6 to 9 months

Lot Buyers Need Full Home Loan Solution

So, in a nutshell, our reader wants to know how to pull this off. I suspect it would not be hard to work out a purchase and finance plan with the bank (and we’ll address that later), but first I would like to address the reader’s situation as if this reader were a customer at my Tallahassee real estate office.

I would have a list of questions that I need to know from the reader, but to keep this brief, I’ll limit them to the “big one.” Would the reader buy the lot if the reader knew that no bank would give them a construction loan in the next 6 to 9 months? This question is important because the construction loan (as described above) would be a huge risk for the bank, and thus hard for the reader to acquire from any lender.

I do not see a bank giving a 100%+ LTV (loan to value) loan on a new home construction project. Our reader would need to have a plan to bring some equity (like 20-30%) of the entire construction and lot costs to the bank for the construction loan. Assuming the total lot and home price will be in the neighborhood of $300,000, then this project will require $60K to $80K from somebody, as the issuing lender will most likely only be willing to finance up to $240K.

Even if the bank will consider other plans, I don’t see how the reader can pull this off without at least $30K (10% down). Banks are in trouble now for doing “no money down” mortgages in the past, and they are not in a hurry to do more of these.

Ultimately, I would try to convince this reader to cool her jets unless she absolutely had to have “that lot.” I suspect there are many more, and more foreclosures coming (though her market area could have different conditions than we have here in the Tallahassee real estate market).

If she knew she couldn’t afford to build until she raised $60K, would that change her immediate plans? If there were 100 other lots similar to this one available, I would urge her to do 2 things: Start putting a monthly payment into a savings account (as if she was buying the lot), and wait until she could qualify for a construction loan before acquiring a home site.

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[see how to purchase real estate with no down payment]

It's Time For A Change In Tallahassee Real Estate Blogging

Century 21 First Realty — Thu, 10 Dec 2009 07:28:39 -0600

The Tallahassee Real Estate Web Site was unveiled on December 19, 2007 and has come a long way. This Tallahassee real estate resource has grown to over 1,000 pages of original content and we are receiving a growing amount of traffic. Additionally, we are observing over 160 downloads each day in our “Special Reports” section in the right sidebar of the Tallahassee Real Estate Blog.

But with growth comes education and experience, of what we have done right and what we have done wrong. We even established a reader survey to provide feedback about the Tallahassee Real Estate Web Site. This survey provided more insight into what our visitors liked and disliked about our site.

Did you know that you can subscribe to the Tallahassee Real Estate Blog by email and it will be automatically delivered to your email inbox every day after a new article is posted? Many of our subscribers love this service, as they can read the blog and discard it, without ever having to fire up their internet browser. Just click this link, enter your email address, look in your email for a confirmation message with a link for you to “click,” then you will receive the timeliest information about Tallahassee real estate.

Change at the Tallahassee Real Estate Web Site

The changes that we are making are going to allow our visitors easier access to all of our resources.

Right now, the right sidebar of the Tallahassee Real Estate Blog holds more real estate resources than any other site we can find, but it is not so user friendly. This is the primary reason for change.

The new look of the Tallahassee Real Estate Web Site is going to allow users to find what they are looking for quicker, and also allow them to find things they might not know even existed.

[click here to find out What Readers Want in our new site]

Home Sales Distribution In Tallahassee

Century 21 First Realty — Wed, 09 Dec 2009 07:11:22 -0600

I received a question from a reader “Jim” in Nashville, TN who asked”

Joe-

Looks like buyers in your area have a lot to choose from. What about affordability? How many of these listings fall into the sweet-spot of homes that are actually selling?

This is such a clear and simple question that I figured a few graphs could show us the answer.

Homes For Sale In Tallahassee

When we look at homes for sale in Tallahassee, we find (happily) that the supply has been dropping steadily since April of 2008. When we look at the real estate graph below, we see the distribution of available homes in Tallahassee across all the price ranges.

Perhaps the only real surprise is the growth of homes available below $75K, as this is one price range in which we can longer build more units because the cost of constructing the units is higher than the going price (does this sound like long-term opportunity???).

Homes That Sold In Tallahassee

The graph of closed home sales in Tallahassee shows us that the real estate market has been cut in half over the past two years. Some price ranges look like they have been slashed ($750K and up, please $0-$75K), while most of the others appear to have fallen just slightly.

The important thing to remember when looking at this graph is that price range shows you what buyers are paying, not what houses they are buying.

So even though the $150K-$200K price range appears to have fallen just slightly, the reality is that many homes priced in that range in 2007 sold in a lower price range this year. And many of the homes that sold in that range this year, used to be priced in the $200K-$250K price range.

What Homes Are Selling In Tallahassee

The real question that Jim wanted answered was based upon our pricing distribution, and there is a simple way to view this.

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[see what homes are actually selling in Tallahassee]

New Pricing Practices Get Homes Sold

Century 21 First Realty — Tue, 08 Dec 2009 07:25:54 -0600

Frustrated homeowners are accumulating, and traditional real estate pricing practices are not making them any happier. It is time to recognize that there is a new way to determine the best asking price for getting a home sold in today’s difficult real estate market.

What we have been doing is not working. The real estate graph to the right shows that if we compare the number of homes that have sold, with the number of homes that were put up for sale over the past year, 81% failed! Would you hire a REALTOR® if you knew they were sporting an 81% failure rate?

I hope not. And you do not have to. There are new techniques that allow a REALTOR® to determine the best asking price for your home, and this article will show you what to expect from a top real estate company in your area. If these technical issues are not discussed, you can rest assured knowing that you are dealing with somebody using traditional home pricing methods and that if you hire them, you will most likely join the 81% club!

How To Find Comparable Properties

The first thing both a traditional methodology and the new methodology will do is to determine the scope of competition for your home. This is done by determining what homes are comparable to yours and how many of them exist and how many were sold over the past year.

The best way to figure out comparable homes is to think like a buyer. If somebody were to consider buying your home, what other homes (meaning in what other areas) might this same buyer look? Will the buyer be constrained to your neighborhood because of very strong amenity, or would the buyer be interested in homes of similar values in other areas?

Often times, I see REALTORS® limit the breadth of competition to a specific neighborhood, when in most instances buyers considering homes in that neighborhood also are considering homes elsewhere.

Gather Supply and Demand Data For Comparable Properties

All the information needed to determine the value of a home is available to REALTORS in their local MLS. The following table shows supply and demand for the entire Tallahassee housing market, but the same information can be pulled for homes comparable to any in a particular MLS. A monthly update of the Tallahassee Housing Report can be downloaded from the Tallahassee Real Estate Blog.

Determine Desired Selling Time

Every home owner has their own goals and objectives in regards to the ideal selling date for their home. The home marketing plan should be geared to this time schedule. Some important things to consider include:

It typically takes 50 to 60 days to close on a contract. So if a homeowner wants to move on June 1st, then a contract is needed no later than April 1st.
More than 50% of contracts written on a home will fail to close, so a homeowner should establish contract criteria with their real estate agent to ensure target dates are reachable.
Remember to think like a home buyer. Home price is the primary search item, so the lower the price, the more often it will appear in a search and the better it will compare to the other homes (see example below).

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[Click To See How To Achieve The Sellers Goals When Pricing A Home]

Supply And Demand Of Homes Coming Back Together

Century 21 First Realty — Mon, 07 Dec 2009 06:19:07 -0600

Every month we publish a Tallahassee Housing Supply and Demand Report which can be downloaded from the right sidebar of the Tallahassee Real Estate Blog. This report breaks down the entire Tallahassee housing market by area and price range, in order to show the relative supply of homes for sale in the Tallahassee MLS.

Today we’ll look at a comprehensive report of the current supply and demand dynamics occurring in the Tallahassee housing market. As a review for our less frequent readers, most real estate professionals agree that a balanced market has 6 months of supply of housing, with less than 6 months supply being a Sellers’ market, and more than 6 referring to a Buyers’ market.

Relative Supply of Homes In Tallahassee

This first real estate graph shows the number of homes for sale in Tallahassee (red), the number of home sales in Tallahassee (green), and the resulting months of supply of homes for sale (blue). The orange line represents a balanced market, and we are looking for the blue line to drop to this level.

The good news from this graph is that both real supply and relative supply are dropping, but the bad news is that we still have over 1 year supply of homes for sale in Tallahassee. But there was a surprise revealed with the newest trend report …

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[click here to see where Tallahassee home buyers are moving]

Northeast Tallahassee Home Values Down 13%

Century 21 First Realty — Fri, 04 Dec 2009 08:34:16 -0600

Recently, somebody asked me how home sales in Northeast Tallahassee are holding up. I explained that this part of the Tallahassee real estate market accounted for roughly one half of the home sales (49% over the past twelve months) and was performing stronger than the other three quadrants of Leon County.

Just a reminder, you can subscribe to the Tallahassee Real Estate Newsletter (free) in the right sidebar of the Tallahassee Real Estate Blog. This monthly newsletter provides analysis of the housing market with charts and graphs to support the finding.

The best starting point when analyzing an area or subdivision in the Tallahassee housing market is to look at current supply and demand of homes.

Supply And Demand For Northeast Tallahassee Real Estate

The real estate chart above shows that the relative supply of homes for sale in Northeast Tallahassee is 11.5 months, which is good and bad. It’s good that supply has continued to fall, it’s good that supply is about 2 months lower than the average in the entire Tallahassee real estate market, but it is bad that Northeast Tallahassee home supply is nearly double the amount required for a balanced market (6 months of supply).

The over-supply of homes suggests that we will continue to see Northeast Tallahassee home prices continue to decline until supply and demand are balanced.

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[click to see graphs of Northeast Tallahassee Home Sales]

A Simplified Short Sale Buying Process

Century 21 First Realty — Thu, 03 Dec 2009 06:02:11 -0600

One of my agents relayed a story to me yesterday that I felt would make for a great post on the Tallahassee Real Estate Blog. He told me that he is helping a buyer buy a short sale in Tallahassee, and he shared with me the conversation he had with the listing agent.

The listing agent told him something like “get an offer in and I’ll make sure it is first in line, every other offer will be a backup.” This comment sent all my alarms to the full scream mode, and I sat down with my agent and had a long discussion about the process of buying a short sale.

Most Real Estate Agents Don’t Understand The Short Sale Process

The first thing I told him was the agent in question probably had limited experience with short sales. If you truly understand how banks work a short sale (this process is outlined in following paragraphs), then you would never “buy” the statement made by the listing agent.

If you are going to buy a short sale, take the time to hire the right real estate company with a seasoned real estate short sale specialist. As I will explain in the coming paragraphs, it will make all the difference in world.

You Cannot Be In A Hurry To Buy A Short Sale

If you are working on a time-table of less than three months, you are not a good candidate for buying a short sale. The process of buying a short sale can take from three to six months, and nobody who knows what they are doing is going to guarantee you a closing date.

Every detail and action that becomes part of the home buying experience is affected by a home seller who has to sell short. Loan lock-ins cannot be relied upon because of the nature of the bank-approval process. Home inspections are a gamble, because if you get one early before you decide to buy, you might not be “allowed” to buy that house. If you wait until the lender approves you, then finding a lot of broken systems at the last second is a shock you will not enjoy.

So what I am saying is there is a process experienced short sale agents will take you through to ensure that you get a great buy without taking unnecessary risks. Most real estate agents do fewer than 2 short sales in their entire career, and they typically are not up to speed on what is really going to happen.

The Banks Are Not Happy To Sell A Short Sale

I have never met an individual or an institution that planned on receiving less money than they invested in any transaction. Yes it happens, but that does not mean they will be happy about it.

And banks are not filled to the brim with stupid people either! They will do what they can to minimize their losses, so it is important that you understand the short sale process so you can best position yourself to succeed when buying one.

The Banks Are Not Staffed To Process The Short Sales In Progress

Think about this. Let’s just say that the stories of loans in default in the United States are true, and this number could be as high as 25% of all existing home loans. Additionally, we hear that 20% of all homes are “upside down” on the mortgage, meaning that more is owed on the home than can be gained by selling the home. So, what does this all mean?

Banks are getting less money than they were a few years ago (read that to mean that banks are failing right now, or at the very least they are losing money).
Loan defaults are up (read that to mean that they have more work to do so more employees are needed than a few years ago, but no money to increase staff).
So, unlike most businesses, when business picks up, so do earnings, resulting in more revenue to utilize in “up-staffing” to handle the workload.
But with Banks right now, it’s the other-way around. Work is up, revenue is down, so they cannot staff themselves accordingly to handle the additional work load. If somebody is trying to sell a house through a short sale, you can be assured that the bank employee(s) handling that file are grossly over-worked and seriously ill-equiped to get things done in a timely manner.

So when you hire a real estate agent specializing in short sales, listen to her advice! She knows who and what she is dealing with and is prepared to help you succeed because she best understands the short sale process.

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[click here to view the simplified Short Sale Process]

Attorney General Requested To Review Tallahassee City Commission

Century 21 First Realty — Wed, 02 Dec 2009 06:55:13 -0600

Two unrelated events occurred yesterday that really got me thinking about all of the issues and events that affect the Tallahassee real estate market. First was an email from a Tallahassee homeowner who needed advice on her home.

She is one of the victims of high unemployment, pay cuts, and lost jobs that have occurred in our area due to the struggling economy. The one chord that really struck with me was when she pointed out that she had worked for the State for 20 years yet had to take a cut in pay to remain employed. This is not the first time that I have seen this occur, and my heart goes out to her.

The second and totally unrelated event was an article that was published on the Opinion Page yesterday in the Tallahassee Democrat. Mr. Erwin Jackson has raised a question of the legality of the raise that the City Commissioners gave themselves without putting it to a public vote.

I really recommend that you watch the video below and you read the opinion piece in the newspaper because if this is truly an unlawful act on the part of our City Commissioners, then there needs to be a loud response by the residents of Tallahassee.

The point in tying these two unrelated events together is that during a time when people are calling me for advice about keeping their homes, even though their jobs have been reduced or terminated, I find it hard to read about City Commissioners giving themselves a 61% raise. Had this gone to a vote, would you have voted these part-time public servants a raise?

Erwin Jackson Asks Attorney General To Review Deferred Compensation

I do not claim to be an expert (nor do I want to be one) in the field of politics. Nevertheless, this issue is at the heart of our depressed housing market, so I will do my best to convey Mr. Jackson’s point of view. If I miss something or do something that is incorrect, I trust our readers will correct me and I can make the correction.

On April 13, 2005, with a simple 4-1 vote, commissioners voted to increase their annual compensation for this part-time job from approximately $36,000 to $58,000.
The City Charter limits the annual salary for city commissioners to $36,000 (or half of what county commissioners make).
City Attorney Jim English assured the commissioners that the additional $22,000 was deferred compensation not a salary benefit.
English’s objectivity is in question since he is also a recipient of this deferred compensation.
English serves “at the pleasure” of the City Commission, thus he might find it difficult to tell commissioners that they have violated the charter and must return the $470,734 illegally taken from the city.
Florida Statutes makes it clear that the amount paid annually to each commissioner under a deferred compensation plan must be included as part of the annual salary. Specifically, the base salary of $36,000 remained constant. The $22,000 was not deferred from the base salary of $36,000. The $22,000 is additional income, not deferred income, and thus violates the City Charter.
The City Commission should request the Attorney General to perform an outside review of the legality of this “deferred compensation” from its unbiased position.

So, if I understand Mr. Jackson correctly, it looks like our City Commission cooked up a plan to give themselves an unlawful raise by calling it something else. They called it “deferred compensation.” Yet they deferred no compensation, they continued to cash their fully-funded paychecks, and they each received an additional $22K per year! Me thinks something is rotten in the state of Denmark!

[see short video of Erwin Jackson challenging the City Commission]

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Where Real Estate Blog Visitors Come From

Century 21 First Realty — Tue, 01 Dec 2009 08:08:21 -0600

Every so often, I like to delve into my web site analytics package to see how many people have been visiting our Real Estate Blog and from where these people are coming. While the top origination points are not so surprising, I am always amazed that many of our visitors come from all over the world. It really underscores the importance of the global nature of real estate.

The map above shows that visits to the Tallahassee real estate blog have come from all around the world, with the countries colored in various shades of green leading the field in the number of visits they have made to Tallahassee (on the web of course).

Real Estate Marketing Has Moved To The Internet

With over 85% of all home buyers starting their search for homes on the internet, it is a wonder that some real estate companies and real estate agents still invest the majority of their marketing budgets on traditional print media. The overhaul that we performed on our real estate marketing efforts back in 2007 is really yielding amazing results.

Foreign Visitors Find The Tallahassee Real Estate Blog

One report that I love to see is our foreign visitors log which shows the originating country and the number of pages viewed by each of our real estate blog readers.

The top ten countries that send internet visitors to Tallahassee are listed in the table on the right (full report follows this blog at the bottom). I find it amazing that the bordering Country of Mexico has not made it into the top ten, while Romania has.

If you are a visitor from a foreign country, thank you for stopping by and please leave a comment below and let us know where you are and why you like to check out the Tallahassee Real Estate Blog.

Stateside Visits To Tallahassee Real Estate Blog Growing

The domestic visitors to our real estate blog are growing as well. Every State in the Union is represented (and listed in the report following this blog), but the top ten might surprise you. Unlike print media which might produce some real estate marketing benefits in neighboring States, it turns out that our real estate blog is highly trafficked from coast to coast.

Much like Mexico not making the “Top 10 Countries” list, I was surprised to find that Alabama was not in the top 10 States that sent visitors to the Tallahassee Real Estate Blog. Outside of Florida, California sends us the most visitors with over 33,000 pages viewed on our real estate website.

Top 10 Pages On The Tallahassee Real Estate Blog

With well over one million pages viewed on our site, I got to wondering what pages were the most popular. The top three were resource pages and were not surprising, but the rest were articles written about Tallahassee real estate and provided a few surprises:

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Tallahassee Real Estate Blog Visitors

The following tables show the top originating countries and States for visitors to our real estate site in Tallahassee:

[click to see full Country and State Traffic Reports…]

The Big 4-Oh In Tallahassee Real Estate

Century 21 First Realty — Mon, 30 Nov 2009 05:47:20 -0600

Forty is on my mind today. Yesterday, we celebrated the 40th birthday of my “little” brother Danny, and this month we celebrate the fact that 40 tough months of real estate is most likely behind us.

Today, we begin to make the climb up from the bottom of the worst housing market since the Great Depression. Incentives are ripe for home buyers, with federal income tax dollars, low interest rates, and some great buys in the housing market.

Sometimes you have to look backwards to see where you are going. Understanding the cyclical nature of the real estate market gives us a long-term perspective on what we should be expecting.

REMINDER: The 16th Edition of the Tallahassee Real Estate Newsletter goes out today to subscribers. If you haven’t yet subscribed, it’s free and you can do so in the right sidebar of the Tallahassee Real Estate Blog.

Year To Date Home Sales Worst Ever

The graph below is one of my favorite views when trying to figure out how we are doing compared to previous years. It combines both single-family detached home sales with condominium and townhouse sales to show a year-to-date comparison with every year going back to 1991.

The residential real estate market really should be viewed this way, as townhouse sales are encroaching on what historically was more of a single-family detached home market. This is primarily due to the increased cost of land as well as location to popular services such as medical, shopping, employment and dining.

Of course, what strikes me when I look at this graph is that we are recording the worst year on record for home sales in Tallahassee (on record means all recorded home sales going back to 1991).

I find great optimism in this graph because I understand the cyclical nature of the housing market, and that the high levels of sales five years ago have given way to our current recovery period.

Leon County is far more populated than it was in the early 1990s, so I am confident that as this recovery cycle ebbs, we will return to levels near 400 home sales per month again. Hopefully, we’ll see those numbers by 2012.

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Expired Home Listings Adding To The Shadow Inventory

Century 21 First Realty — Fri, 27 Nov 2009 08:16:31 -0600

A friend of mine asked me the other day “what’s the real deal in Southwood?” I responded “The real deal?”

He said he heard all kinds of rumors about what is going on in Southwood, that taxes are up and values are down.

I told him that I would do a thorough analysis of the real estate market in Southwood, as I knew it would make great material for the Tallahassee Real Estate Blog.

So today we’ll take an analytical tour of the supply and demand of homes in the Southwood neighborhood.

This post is packed full of information, including four (4) color graphs as well as two (2) important lists of homes. Make sure that you click the continuation link below, where it says "[click to see market graphs and list of homes in Southwood]"

There is a list of the homes that are currently on the market in Southwood, and there is a list of homes that are known to exist in the Southwood Shadow Inventory.

I believe my friend’s question stemmed from an article in the Tallahassee Democrat on November 24th, where it was reported that Southwood was “getting low on inventory” and only 45 homes were on the market. Since I keep a regular eye on Southwood, I found that report to be amazing. And it was. In fact, it wasn’t correct.

The good news is the number of homes for sale in Southwood (67 homes) represents about 9 months of supply, which is lower than last reported. Since the Tallahassee housing market is currently registering 13.7 months of supply (see Tallahassee Housing Report for November), Southwood can claim to be doing well better than average.

Supply and Demand Of Homes In Southwood

Unfortunately, a market at equilibrium usually registers at 6 months of supply, so I see continued pricing pressure for homeowners who wish to sell a home in Southwood. The following real estate graph shows homes for sale in Southwood and compares them to homes that failed to sell as well as homes that sold over the past 8 years.

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[click to see market graphs and list of homes in Southwood]

Signs Show Shadow Inventory Of Homes Is Growing

Century 21 First Realty — Thu, 26 Nov 2009 10:36:15 -0600

Yesterday, I received a great comment by a Destin, FL REALTOR® who pointed out that the shadow inventory of homes has many more components than just the defaulted mortgage pool. His example was of homes in a new neighborhood, developed in 2005, where all of the home owners are now upside-down on their mortgages.

As he explained in his comment on the Tallahassee real estate blog, Jim noted

Until that whole neighborhood turns over, it is going to have downward pricing pressure. We are talking about hundred of homes within a small radius.

So what this means, in a nutshell, is many homeowners in these types of neighborhoods become part of the growing shadow inventory because even though they might want to move, they are not in a position to sell their home.

Another Example Of The Shadow Inventory In Real Estate

I was doing some research on the Southwood neighborhood (after reading a poorly researched article) and found that there are 69 homes for sale in Southwood, just in the Tallahassee Board of REALTORS® Multiple Listing System. That doesn’t include any un-listed builder homes or “For Sale By Owners.”

As I was going through the data, I decided to look at all the homes that had been sold in the past as well, and I came across one that was on the market since December of 2005. It recently sold this year by a different real estate company for 28% less than its original list price! The reason that it caught my attention is because it showed a “time on the market” of just 1 day! How could this be …?

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[click here to discover the 2nd largest source of homes in the Shadow Inventory]

Forecast Calls For Home Prices Dropping in 2010

Century 21 First Realty — Wed, 25 Nov 2009 10:07:32 -0600

The Tallahassee area logged 163 single-family existing-home sales in October, down 5 percent over a year ago which is not as good as many other areas in Florida that seem to show gains in every market measured. Of course, those measurements are from REALTOR® MLS reports, which typically do not show much more than 1/2 t o 2/3rds of the entire market activity.

The median price for those local sales gained 1.2 percent to $174,000 from $172,000 in October 2008. Fort Walton Beach was the only other market in October to see prices rise, up 1 percent from a year ago.

Graph Of Home Prices In Tallahassee, Florida

The real estate graph above shows that the average price continues to drop, while the median price has actually been recovering. Unfortunately, the graph does not depict appreciation or depreciation, as it shows what home buyers are paying without regard to what they are buying.

Tallahassee Housing Market Sees Slight Increase In Home Sales

This is wonderful to report, as we have been producing reports showing the number of homes selling in Tallahassee declining for over 3 years running! Based upon the growth in pending home sales, it appears like the market is starting to turn around.

Much of this could be due to the First Time Homebuyer Tax Credit which was scheduled to terminate at the end of November, but with the extension, buyers have until June 30, 2010, to close on their purchase, and the rules no longer limit the credit to first-time buyers. Hopefully this will continue the rise in pending home sales.

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[click here to see why home values will drop in 2010]

Foreclosures Affecting Shadow Inventory Means Trouble

Century 21 First Realty — Tue, 24 Nov 2009 06:41:51 -0600

We have been keeping an eye on home foreclosures in Tallahassee for several years now and have warned that a log-jam of homes has been accumulating in the shadow inventory. In today’s foreclosure update, we’ll look at the location trend of homes that are being added to the “distressed properties” list in the Tallahassee real estate market.

The foreclosure process begins with a lis pendens filing, so we make sure that we track not only the final foreclosure sale, but also the monthly lis pendens filings in Tallahassee. When we construct a real estate graph of these two important concerns, we find the following picture of foreclosures in Tallahassee.

In the graph above, we see that every month there are hundreds of lis pendens filed in Tallahassee, yet the number of foreclosures rarely reaches a level equivalent to a 20% foreclosure rate. As we have discussed in the past, this might mean that up to 80% of the lis pendens filed in Tallahassee in the past two years have yet to be foreclosed upon.

While there will be some people who are able to work themselves out of the situation through a loan modification, early information suggests that less than 5% of distressed property owners in Tallahassee work out a loan modification.

Others will attempt a short-sale, but without lender support, many homes for sale in Tallahassee attempting short sales are just sitting there waiting for a response from the lender. This is how the shadow inventory of homes in Tallahassee continues to grow each and every month.

Foreclosures By Zip Code In Tallahassee

One report we like to take a look at from time to time is the graph of lis pendens, sorted by the property zip code and month that they were recorded. When we look at this report, we find that some areas are getting hit harder than others. Four zip codes, 32301, 32311, 32312, and 32317 have seen 60% growth or more in lis pendens filed this year versus last year.

Homes For Sale In Tallahassee

By monitoring the condition of homes for sale in Tallahassee, we have noticed that a trend of increased short sale and foreclosure offerings is occurring. The real estate graph below shows that roughly 20% (minimum) of properties fall in the “distressed” categories.

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List Of Recent Lis Pendens Filed In Tallahassee

FHFA Says Keep Loan Limits Same

Century 21 First Realty — Mon, 23 Nov 2009 06:51:27 -0600

The Federal Housing Finance Agency (FHFA) last week announced that the maximum conforming loan limits for mortgages originated in 2010 will remain unchanged from the list provided in 2009.

The maximum loan limits for Tallahassee and all other areas in the United States can by found in a download-able format in the right sidebar of the Tallahassee Real Estate Blog, or by clicking this link to the list of FNMA loan limits by county.

So why does it matter what the FHFA says about loan limits? Because the Federal Housing Finance Agency regulates Fannie Mae, Freddie Mac and the 12 Federal Home Loan Banks. These government-sponsored enterprises provide more than $6.3 trillion in funding for the U.S. mortgage markets and financial institutions.

The ability of our market to recover and get people buying homes again is going to rely heavily on the availability of home loans. These Government Sponsored Entities (GSEs) make loans possible for more than 85% of the homes in the Tallahassee real estate market.

The loan limits in Tallahassee are similar to those in most of the rest of the United States, and the following table shows how much money can be borrowed for different types of residential properties in Tallahassee:

Property Type	Loan Amount
One-Unit Properties	$417,000
Two-Unit Properties	$533,850
Three-Unit Properties	$645,300
Four-Unit Properties	$801,950

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Tallahassee,FL:Killearn Lakes Unit 4

Century 21 First Realty — Fri, 20 Nov 2009 05:33:45 -0600

If you have been following the Tallahassee Real Estate Blog over the past few weeks, you know that we have sporadically reviewed some neighborhoods in Tallahassee, and lately have done the first three units in Killearn Lakes Plantation. Today we’ll take a final look at Killearn Lakes, with a review of its 4th unit of homes.

Killearn Lakes Unit 4 is also know as “Grandview” and features homes on lots that range from 1 to 10 acres. As you will see from the following real estate graphs and analysis, home values have held much more stable in this neighborhood than many others in the Tallahassee real estate market.

Average Home Prices In Killearn Lakes Unit 4

The first thing that I noticed when I looked at the existing home sales in Grandview was that the trends were not as seamless as Tallahassee neighborhoods that have more home sales in them. The average price of homes in Killearn Lakes Unit 4 jumps around quite a bit, but look at the average number of homes sold each month (left axis), the number averages below 1 home per month.

Killearn Lakes Unit 4 Home Values Show Slight Decline

Home values in Killearn Lakes Unit 4 (Grandview) are showing a trended decline of 13% since the peak of the market. That is 1/2 of the average decline in Tallahassee home values, so obviously Grandview appears to be doing comparatively well.

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[follow this to see the past 100 home sales in Grandview]

Housing Starts Drop, Confuse Associated Press

Century 21 First Realty — Thu, 19 Nov 2009 07:48:47 -0600

All across America this morning, people will be grabbing their morning paper (online most likely) and reading an article that was circulated through the Associated Press about the new home construction industry. As a matter of fact, the article features a picture of a home being built in Tallahassee (and that is how this feed caught my attention).

Unfortunately, the article is grossly misleading. The authors of this article apparently do not consider “supply and demand” in real estate to be a factor that home builders should consider when deciding what to do.

In the real estate equation, the supply side is filled by:

New home builders building homes
Existing home owners selling their home
Banks and asset managers liquidating their inventory

On the other side of the real estate equation, the demand side, is filled by the growing need for new homes from:

Home buyers
Home renters (this is also where we would see home investors)

Glut Of Homes Force Smart Home Builders To Wait

The fact is, there is a glut of homes on the market that is forcing wise home builders to wait for the real estate market to need more houses. The Associated Press article leads us to believe that this is a “shocking new development.”

Construction of homes unexpectedly plunged last month to its lowest point since April, the Commerce Department said Wednesday. The weak figures show that builders still lack confidence that buyers can soak up the glut of unsold homes already on the market — a supply magnified by a record number of home foreclosures.

The real estate market’s glut of homes is not a big surprise. All a home builder has to do is track the inventory of homes on the market and then make a decision on where the entry point will be for his (or her) construction company.

So, how and when does a home builder choose an entry point to start building? [click to see the real market information that home builders rely upon]

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Any Truth To Tiger Woods Joining CENTURY 21?

Century 21 First Realty — Wed, 18 Nov 2009 07:43:56 -0600

I have heard the rumors, have you? Tiger Woods joins the Tallahassee Real Estate Team At CENTURY 21 First Realty? It’s not enough to hear the rumors, but do we have photographic evidence as well?

Of course, the picture of Tiger Woods could just be the one where he is wearing the victor’s Gold Jacket after winning the Australian Masters golf tournament this past weekend, but who knows….

Speaking of golf tournaments, I was fortunate to play in a charity golf tournament at Golden Eagle on Monday. The tournament was created to support Christmas Connection and our Winning CENTURY 21 team was sponsored by Stan Kupiszewski.

Christmas Connection Serves Basic Needs Of Families

This is the time of year when many great charitable groups are raising money to help people who are down on their luck, or at least less fortunate than many of us right now. Christmas Connection tries to fulfill the wishes and some of the basic needs of hundreds of needy families each holiday season.

Christmas Connection is a non-denominational program organized by Catholic Charities and run primarily through the assistance of volunteers to help the neediest in Leon and surrounding counties. In 2008, recipients of this program (3,148 persons/507 families) were referred by caseworkers from over 40 area agencies. Over 756 volunteers contribued 2,771 hours at the site to meet this goal last Christmas.

How We Can Help The Christmas Connection

Christmas Connection is lucky to have great involvement from the Tallahassee community, and one of its bigger partners is WCTV. I have never been to a Christmas Connection event and not seen Julie Montanero, who gives tirelessly of herself to this great cause.

We can follow Julie’s lead in helping Christmas Connection bring joy to hundreds of Tallahassee families this holiday season.

Some of the different ways that you can help include:

Adopt a Family ~ Fullfill their wish list (Call 850-222-2180)
Donate items for specific people featured on WCTV
Donate Money (send checks payable to Christmas Connection to PO Box 20165 Tallahassee, FL 32316)
Donate New Money or New toys
Donate their “MOST NEEDED” items (food/clothes/heaters/diapers/blankets)
Volunteer at the Christmas Connection Warehouse in December
Help Spread the Word (send a link to this article to everybody on your email lists and ask them to visit the Christmas Connection Web Site)
Spread the news through Twitter by clicking on the Twitter Bird below

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As a reminder for those who subscribe to the Tallahassee Real Estate Blog by email, some embedded pictures and videos might not be appearing in your email and you might need to click the title header to go to your browser where all will be visible. Additionally, if you would like to respond (leave a comment) to this article, you will need to “click through” to the blog site to post your feedback.

Keep checking out the Tallahassee Real Estate Blog every day for updates on real estate in Tallahassee Florida.

Joe Manausa is a real estate blogger, a real estate investor and the Broker and Co-Owner of Century 21 First Realty. He can be reached via e-mail through the Tallahassee Real Estate Website or catch his latest writings on the Tallahassee Florida Real Estate Blog , or by calling (850) 386-2001.

Know The Stages In This Housing Market Turn

Century 21 First Realty — Tue, 17 Nov 2009 06:56:00 -0600

Many people are wondering just exactly where this crazy real estate market is heading and how to anticipate its next move. Unit sales have dropped and prices are continuing on a downward spiral.

In the past three years, we have seen a very hot sellers’ market change to a very cold buyers’ market, but many people do not realize that there are five distinct stages that we must move through to transition from a buyers’ market back to a sellers’ market.

After posting yesterday’s Tallahassee Housing Report, I received a comment from a colleague who wanted me to cover this very issue, and she wrote:

Hi there, been doing this since 1981 and do have lots of past and present clients really interested in your wonderful information.

What is hard to convey for me is that even though sales are creeping up a bit, prices are not as far as I can tell. Would you cover this ,in comparing sales increases to prices increases? Thank you, Sandy

Five Stages Of A Real Estate Market Transition

As the market started to cool from a sellers’ market to a buyers’ market, one of the residual side effects was an increased inventory of homes for sale. Home builders and developers, who were previously working at a frantic pace to supply the market with enough homes, missed the tell tale signs of the end of the bull market and kept building more homes.

Now that we have this over-supply (glut) of homes, we must move through the five stages of a real estate market transition before we see home values start to appreciate again. These stages include:

1. Real estate inventory levels stop rising and begin to decline.
2. Home values fall at an accelerating rate.
3. Year over year home sales increase.
4. Real estate inventory levels reach market equilibrium (6 months of supply).
5. Home values stop falling and begin rising.

So, taking these by the number, we can vigilantly monitor our market so that we know where we are, and knowing the five stages of a real estate market transition will tell us where we are going!

[click here to see the Five Stages Of A Real Estate Market Transition]

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Graphing Provides Clear Understanding Of Housing Market Moves

Century 21 First Realty — Mon, 16 Nov 2009 07:33:34 -0600

The Tallahassee Housing Market is undergoing a pleasant change right now. Most of the key indicators signal that we might be starting a recovery.

Is it due to the fact that we have spent two years selling roughly 50% of the number of homes that our market history sells? Or is it due to the Home Buyers Tax Credit (both the extension of the First Time Homebuyers Program as well as the extension into a program for all)?

I think it most likely is a combination of both of these. I also think it is wise to keep track of what is occurring, as we know that there still exists several reasons why our market is not going to “return to normal” for quite some time.

Pending Home Sales In Tallahassee Continue To Rise

Maybe the most important trend that we can track from the Tallahassee MLS is the daily movement in the one-year trend of pending home sales. These are homes that are “under contract” between a buyer and seller, but have yet to close. Tracking pending home sales allow us a glimpse of what sales activity should look like in the next 60 days. As you can see from the real estate graph below, pending home sales are rising nicely.

Positive Results In Closed Home Sales

While the Pending Home Sales Report show us what is going to happen, the proof comes from the Closed Home Sales Report. The existing news comes from the following report, and the results show that home sales in Tallahassee are finally on the rise.

{click here for the remaining Tallahassee housing graphs}

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