|Daytona Beach Area Real Estate Market, Data and Updates. By Lisa Hill, "THE SMART CHOICE!"|
Last week I wrote a Daytona Beach real estate blog that provided general information, updates and listings. In that blog post, I mentioned how over the years, there have been times when, as a REALTOR®, I've sold houses that were not actually listed in the Daytona Beach area Multiple Listing System (MLS). In this post, I'm going to elaborate on the real estate conditions of a few years ago, in contrast with today's real estate market, and how it affects the way real estate agents conduct their business.
With the current Daytona Beach area real estate market being such a strong buyer's market, and plenty of real estate listings in our Multiple Listing System (MLS), it's not often that REALTORS® need to sell houses that are listed For Sale By Owner (FSBO). We already have more listings than we need, and our real estate buyers are overwhelmed by too many choices.
As a REALTOR®, upon 1st contact with a real estate buyer, I have to get specific information from them regarding what they need in their real estate investment, in order to narrow down the list of available properties for them. The Daytona Beach area MLS provides that information, and enables REALTORS® to fill out only the fields their buyers need so that we as REALTORS® don't have to spend an additional 2 hours, weeding out the properties that will not be of interest to the buyer we're helping at that time. Even if a real estate buyer only wants to purchase a house in a particular neighborhood, or a condo in a particular building, when we drive by and see a FSBO sign, we only know what the property looks like from the outside. We don't know the condition of the inside, or what upgrades have been made. We could pull the property up on the Volusia county tax assessor's web site and gain a little bit more information, but it still wouldn't be enough, and we would have no reason to when we already have plenty of other properties on the market in that neighborhood or building, located in the MLS. (Of course, there's always the possibility that a buyer will request that I call a FSBO for them, and in that case I will gladly do so.)
However, this market is a stark contrast when I look back at the real estate circumstances of just a couple of years ago. At that time I would frequently call FSBO real estate sellers who did not have their houses listed in the Daytona Beach area MLS, (or New Smyrna Beach MLS: I'm a member of both REALTOR® Associations.) in a desperate attempt to find something that would meet the needs of my real estate buyers. During the seller's market, it was common for me to sell FSBOs. At that time, we couldn't keep enough real estate listed in the MLS, so to help our buyers find what they wanted, we worked with sellers who did not have their houses listed with REALTORS®.
Now let's look at the number of listings that were in our MLS during the seller's market.
During the sellers market of just a couple years ago, the Daytona Beach area MLS only had an average of 1400 listing for all of Northeast Volusia County. Think about it. Only 1400 listings for 9 cities! In that real estate climate, if you wanted to buy a house, condo, townhouse or even a manufactured or mobile home... you had to look fast, make a decision, and make an offer as high as you could go, then cross your fingers and hope someone else didn't come along and offer more than the asking price before the seller had a chance to sign your contract. I wish I had kept track of how many real estate listings I sold above the asking price, usually within a few days of the property being listed.
As we all know, today's real estate climate is much different than the seller's market of 2002 - 2005. In mid 2005, the real estate inventory in the Daytona Beach area MLS began to climb. Being of a nature that notices these types of details, each day when I logged into our MLS, I noted the total number of residential listings on the market. And as I saw that number continue to climb, I started printing the home page of our MLS so I could track the change for myself. As the speculators who thought they could make fast money continued to buy more and more residential real estate, and put those same houses and condos back on the market at massively inflated prices, real estate buyers were forced to pay more and more for their homes.
Now to compare the number of real estate listings in today's Daytona MLS, with how that number effects why a REALTOR® will or will not sell a FSBO.
The Daytona Beach MLS now has an average of 6100 residential real estate listings. Thankfully, that number is down from an average of 7400 in 2007. But the supply still by far exceeds the demand. And since there is far too much real estate listed in the MLS to be purchased by the limited number of real estate buyers that are currently interested in buying, REALTORS® rarely have any reason to call FSBOs. (For the actual statistics of how many listings are on the market in each city, and how many sales have occurred so far this month, view the home page of my web site at www.DaytonaBeachRealEstateSales.com.)
I frequently receive e-mails from FSBO sellers, offering me a (lower than usual) commission to sell their house, condo, townhouse, or manufactured home. But with 2.3 years of inventory already listed in the Daytona Beach MLS, not only do I not have need of any more inventory, it actually messes up my system, to add FSBOs into a list of potential properties that I've prepared for a particular buyer. I also don't have the complete property details that I can find for properties that are listed in the Daytona Beach area MLS, nor do I have the necessary photos and video, and last but certainly not least, I'm unable to e-mail the FSBO listing data with the MLS listings.
In closing, I'd like to mention an even bigger concern, which has always been a problem. And that is the lack of representation for the sellers. If I have to sell a FSBO, I have the sellers sign a "Notice of Non-Representation", since they'll be representing themselves. And most sellers, while being familiar with the general process of selling a home, are not experienced with all the details that they don't usually see the agents do. It's not that I fault them for this. I mean, considering that every single transaction I have brings new questions, problems and experiences, how could a FSBO seller possibly foresee even a small percentage of what REALTORS® have had to work through? And if you're a FSBO seller who is reading this, I apologize if this sounds patronizing. That is not my intent. It's the simple truth. It's my full-time job to be an expert in my field. Yet, this industry is constantly evolving. If I didn't have my finger on the pulse of real estate every single day, then I wouldn't be an expert.
With few exceptions, in my experience with selling FSBOs, the sellers were either unable to answer my buyers questions, or needed me to explain every addendum and clause. In other words, I was doing the job of the listing agent but without the pay that a listing agent would have received. I was receiving the amount of commission that is paid to a REALTOR®, for representing ONE side of the transaction, but doing the work of both sides of the transaction.
So in today's buyer's market, in my experience, fewer FSBO listings are being sold by REALTORS®. And if anyone was wondering why this is the case, now you know! =) But feel free to call me if you have any further questions. I'd love to help.
Daytona Beach area real estate buyers and sellers, make a Smart Choice and call Lisa Hill for all your real estate needs.