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Forces that affect Real Estate Prices

tampa4u — Mon, 31 May 2010 10:09:43 -0700

The price of real estate is greatly influenced by the supply and demand of the market. In the 40s and 50s, a real estate buyer has to put up 20% of the selling price as down payment. This put him in a situation where he has a solid investment on the property; but caused him some personal sacrifices to raise the amount. This minimized his speculative moves on the property that stabilized real estate prices into its real values during those times.

But during the recent times, liberal credit has eased the manner of owning a property. With just 5% or no-down payment schemes, one could buy a house. This situation increased the demand of houses for sale that caused their price to spiral upward artificially. This is aggravated by the Sub-Prime housing loans given to unqualified borrowers. These easy loans were induced by the avalanche of excess funds, some coming from foreign sources. These also tempted many unqualified borrowers to speculate in buy and sell of houses, which further pushed the prices to an artificial record high.

These abnormal ways caused the real estate price bubble to burst, causing prices to settle at their true worth. These occurred when due dates of these Sub-Prime loans came; and the speculators who have no funds to support their ventures defaulted on their amortizations. These caused world-wide economic crises, considering that some of the funds came from foreign sources.

Though the real estate prices all over the world were affected due to lower demand, and also, due to lack of funds as a result of the economic crises; the real estate prices bubble burst occurred most severely in USA; because it was here, where most of the speculative real estate ventures occurred. These caused the house prices to spiral down, even lower than their true value. Suddenly, there is an oversupply of houses for sale.

So, this is the time for astute investors to buy houses, while prices are down at low artificial level.

That May be a Light You See in the Tunnel

tampa4u — Mon, 26 Jan 2009 18:02:04 -0800

In the tunnel that is the Tampa Bay area Real Estate market, there appears to be some sort of light. Usually we say the light at the end of the tunnel, but we arent near the end of this tunnel. But there is a shimmer of light inside the tunnel.

The Feds lowered the rate last week, and now the rates are going back up. This is a good sign of things to come. When the rates go up after they have been down, it is because of demand. Consumers jump on the wagon and the banks raise the rates to get a little bit of their money back.

When the banks get over-whelmed with home buyers and homeowners looking to get a mortgage or refinance an existing one, they have to raise the rates to slow the push back down and make some profits as well. It happens all the time, and it usually happens when the market is strong. This is a sign of a light in the tunnel.

The news we keep hearing is that prices keep coming down as the inventory of existing homes keeps going up. This isnt a bad thing for home buyers looking for a great deal. The market has every shape, size and style home you could imagine. All at prices that are closer to their real values and definitely more affordable.

Regardless of how you look at the tunnel, the light is there. It may be a little fainter than we would like, but it is still a light. And where there is light, there is hope. Hope for a better, more affordable market for everyone concerned. Its a win-win situation for all. Buyers get a great deal and sellers finally get their wish-a sale!

We look at the trends in the Tampa Bay real estate market, and we see one constant-falling median price. This is not the end of the world. A lot of people made a lot of money while the median prices were 2-plus times over-inflated. Hopefully these people made smart choices with their profits. If they did, then good for them. If they didnt, then they probably arent as optimistic about the interest rates and their moving. We cant please everyone.

Now we will watch the rates go up and down thru the summer. As the market continues to show signs of strengthening, we will see more changes in the rates. Then the Fed will drop their rate and allow even more people to take advantage of the “bailout money”. By mid-summer, we should see the lower rates spark more mortgage writing and reduce the inventory of homes for sale in Tamp Bay. More light in the tunnel.

So, as was mentioned earlier, we are beginning to see some light in this tunnel. Banks are beginning to make adjustments to interest rates to slow down a robust trend in mortgage writing. This is a good sign for anyone looking to buy or sell a home. If you can wait a bit longer, watch the rate trends and jump when the time is right. This is the light in the tunnel…come to the light!!!

Welcome 2009

tampa4u — Sat, 03 Jan 2009 15:14:05 -0800

If the last couple of days is any indication of things to come, then we're all looking at a very bright 2009. We have been swamped the last couple of days. We're back to getting hundreds of emails a day, as oppose to 20 emails a WEEK the past couple of months. Maybe it's just January but then again, usually January is a slow month. Stock market started on a bright note also so hopefully people are realizing the opportunities at hand.

Wishing everyone the very best year yet. Cheers!

Happy Holidays to Everyone

tampa4u — Thu, 25 Dec 2008 10:10:54 -0800

It was a GREAT year. The next will be even BETTER. There will and always will be lots of buyers, lots of sellers, and lots of opportunities in this challenging and changing market. Keep your head up and stay ahead. It will be a totally different playing field with lots of new players. But the best thing is the trophies are up for grabs! Have a Happy and Safe Holiday. :)

Happy Thanksgiving to all

tampa4u — Thu, 27 Nov 2008 14:23:26 -0800

Happy Thanksgiving to all. Enjoy the rest of the weekend. Those of us who are in here have a lot to be thankful for.

Tampa Channelside Office: Best Decision we ever Made

tampa4u — Tue, 18 Nov 2008 10:50:56 -0800

Location, location, location, applies to Real Estate offices as well. Yet you will find some tucked away in a no-traffic strip mall or in the 3rd floor of a high rise building. Truthfully, a year ago, I didn't think it really mattered.

I was reluctant to have an office in Channelside. Although it is one of the most visited streets in Tampa and having an office there would give us the high profile we wanted, the numbers didn't make sense. The numbers didn't make sense either for us to start our own brokerage. We would have made more money staying in our current brokerage with our team. But my husband wanted it. He said his guts told him that's the direction we should go. We debated about this for a long time and although the numbers still didn't make any sense in doing this, we opened our office and a new brokerage in April of 2008.

6 months later, we have 230 closings from 14 agents. 2 of the agents are me and my husband who are responsible for only 5 of those closings. So a majority of those are from 12 agents. We have since added 6 more agents; 3 of which are still on training. Do the numbers make sense now? Oh heck, yeah. Question is why we didn't do this sooner. We have to give credit to our hard working agents. They put in extraordinary efforts and that's why they get extraordinary results. A majority of our sales have been in new construction and builder inventories. That's why builders love us and give us their specials before they make print.

So, if and when you're ready to embark on your own brokerage, don't discount the power of location and traffic when choosing an office location. Good luck to all of you. May your closings close and your short sales short.

Why Aren't Sellers Looking Online?

tampa4u — Sat, 25 Oct 2008 23:24:24 -0700

Almost every other day, we'll get a call from a seller wanting to know if we have buyers who may want to buy their property. Apparently sellers know we have buyers. Question is, why didn't they list with us in the first place? - Because sellers don't look online for an agent or brokerage to list their homes. They start looking online when they become anxious after 60 days without a showing. This have been very frustrating. How can we get the message to the sellers that the buyers are online and that the best exposure for their listings will be online. Thru postcards? Bench advertising? Billboards? Thru farming?

So far we've gotten listings thru referrals and from past clients who are now selling. But the goal is to have as many sellers as we have buyers. The web is very good for catching buyers but so far we haven't found a niche for getting sellers. We're too late for REO listings although we feel that banks should also be more selective on choosing agents and brokerages to list their properties. I've seen so many homes listed with just one ugly photo. Since most of our inquiries are from out of state, they always request for additional photos and we end up taking photos of these listings ourselves to send to our clients. Most of the time the listing agents will not even return our calls, even when we already have offers.

I think there should be a way to be able to reach the sellers online... we just haven't figured it out yet. As soon as we come up with something, we'll let you know.

Never Judge a Book By Its Cover

tampa4u — Fri, 17 Oct 2008 06:03:20 -0700

As a real estate agent, you may have the tendency to see the homeowner and immediate take note of how they look on the outside as a correlation to the money they may have to spend on a home. There is fault in this judgment, both on a moral level and on a professional level. Lets walk through a scenario for a bit.

A man and a woman walk into your office seeking a home. They do not have a new car, their clothes are not designer and they look as though they are simple, middle class people. You immediately ask if they have sought after a mortgage and been preapproved and they state they have not. Their accent kicks in and reminds you of a country song. Now you have totally turned off to the needs of this potential home buyer and tell them you are very busy and offer them a card for an associate who has a bit more patience.

Then…..a week later, the associate calls you and thanks you immensely for referring a million dollar client to them. The commission was fantastic and they made enough money off one sale to take the rest of the year off.

You now feel like a heel and hate yourself for missing out on a huge deal just because the buyer did not APPEAR to be the most affluent person on the block.

There is little way to know the financial status of the people who walk through your door, but rest assured there are people that save their entire lives to buy that dream home. While many people have trouble saving even a few dollars to pay for Holiday gifts, others have a knack for saving every penny in hopes of a dream.

In real estate, you have to treat every potential home buyer like they are holding a suitcase full of hundreds because you have no idea what is in the trunk or under the mattress.

Celebrity Becomes Synonymous with Listing

tampa4u — Fri, 10 Oct 2008 12:08:11 -0700

In the world of the celebrity real estate drop, the listings are going up and the sales are no where to be found. As a nation, we know the financial sector is hurting when there are no big sales to report and a ton of listings.

An LA restaurant owner, Lonnie Moore, lists his home in Hollywood Hills for $3.5 million. The home was once owned by Mike Tyson and Robin Givens.

Regis Philbin is ready to ask, “Is that your final answer?” to a home buyer for his Greenwich home. The home is listed for $5.4 million.

Beverly Hills has a new listing to report. Mark Wahlberg, once a singer now an actor, has listed his home for a whopping $15.9 million. The home is nearly 9,000 square feet and was bought in 2001 for just under $5 million. Hello! The market is dropping not rising. I bet we see this price dropped in a matter of months!!

Julianna Marjulies, made famous by the hit show ER, has listed her Santa Monica, California home on the market. The home is listed for $4.5 million.

Have you ever heard of the Polaroid Beach House? Me neither, but it must be a hunk of gold cause the MLS has it listed for sale for $32 million. Just because Travis Barker once leased the home does not mean it is worth that much money. The home measures only 1,800 square feet....waiting.....OH the listing includes plans for a 6,000 square foot home. I still do not understand the price tag, but will move on.

The final listing this week is the Bachelor house. The hit TV show must not have made as much money as they thought it would. The home was originally listed for $13 million and has since been reduced to $8.75 million. (I was looking for a summer home...)

Venetian Isle in St. Petersburg, Florida

tampa4u — Sat, 27 Sep 2008 07:30:09 -0700

This gated community is full of large homes on beautiful properties. There are 91 homes with 4 to 5 bedrooms each. These homes are spacious and beautiful with the land being glorious and glamorous. There is truly a feeling of being on top of the world in this gated community. This beautiful location boasts beautiful tennis courts and a gated park. There are many great views one can see from their home in this glamorous gated community.

The downfall is that there are many rules that one must follow to preserve the quality of life for all residents and the resale value of the home and the neighborhood. These rules are a combination of city ordinances, community covenants and board rulings. Some of these rules include the ability to change the outside of the home. This means that any changes must be approved by the board and must fit within the rules that the community has set up. There are also certain shades that one is allowed to paint the homes. This is to preserve the color coordination of the homes. The most extreme of the rules is that no pickup trucks or commercial vehicles are allowed to be parked at the park for more than 4 hours while mobile homes, buses, and campers are not allowed at all. There is also no hanging of one's clothing outside.

See all Venetial Isle Homes for Sale and other St. Petersburg Communities.

These rules are a small price to pay for those who are looking for the benefits of living in a gated community. There are many benefits to living in a gated community. One such benefit is the security that a gate provides. It is considerably more difficult to get into the community, and therefore more difficult to rob the residents of that community. There is also the guarantee that the property value will not decrease due to one's own action or the actions of the neighbors. This can be quite a relief for those who have owned property for considerable time in the area, especially knowing that the property values in some areas are decreasing due to poor property management and developments. The rules also help to enhance one's quality of life by providing fair rules for everyone to follow, allowing no one to boast of wealth, or to feel less wealthy by not having the mobile homes or boats, as no one is to have those on the properties.