Foreclosure Rates are at an all time high

	342,000 U.S. homes received a foreclosure notice in April 2009. Nationwide, foreclosures are up 32% from April 2008. More than 1.3 million homes have been foreclosed since August 2007.

It is predicted that foreclosure filings and repossessions will increase in the future month due to the end of legislative and companies moratoriums that slowed down the foreclosure process for a short time.

Sales are up 25%, prices drop another 14%.

The average home price has dropped to $169,000 in the first quarter of 2009.

With the drop in prices, affordability increases. Many buyers, once priced out of the market are now taking advantage of the several government programs meant to encourage home buying. A popular program is the $8000 tax credit for the first time homebuyer. Half of the closed sales in the first quarter count for first time homebuyers. Find out if you qualify. PDF

Good News: FHA loans are designed to help first time homebuyers even more. Purchasers with FHA approved mortgages may soon qualify for a bridge loan or cash advances for up to $8000 that they can use as a down payment or to help with closing costs...read more

361 Foreclosure Homes sold in Naples, Florida in the first quarter of 2009

	SOLD 1/26/2009 for $195,000 List price: $194,000 Days on the Market: 78 Previous recorded sale: 12/20/2006 for $463,200
4 Bedrooms, 2.5 baths, 2 car garage, pool home, built in 2006, Naples, Florida	57% price decline in 24 month

Mortgage rates are at an all time low...

Overflow of inventory...235 Active Foreclosure Listings in Collier County as of May 2009

Foreclosure Homes receive multiple offers and often times sell for higher than the listing price. Just like the example above. Average days on the market falls to a low 69 days. Many foreclosures receive multiple offers within the first days of marketing.

Properties once out of reach are now the grounds for bidding wars. In many cases lenders resort to Auctions. Foreclosure Properties offered at auctions often fetch higher prices than the estimated market value at the time of auction. Short sale properties are a perfect candidate for auctions as in many cases the listing agent has them overpriced. The auction marketing brings qualified bidders in a room and in fact produces an offer.

Lenders are not in the business of owning homes. The cost of a foreclosure process reaches $30,000-$58,000. Many homeowners take the path of least resistance and walk away from their properties without negotiating with the bank. Foreclosure properties often sell for 50-75% below 2005-2006 prices.

Buyers Market or Sellers Market?

Traditional home sales have declined. Prices are influenced by short sales and foreclosure listings. Many home owners are opting for a deed in lieu of foreclosure or a short sale process.

The average home price in every neighborhood has dropped. We are observing two distinct segments of the Real Estate Market: a buyers market and a sellers market coexisting together. Here is an example of 2 active listings in Fairway Preserve, Naples, Fl.

Buyers Market	Sellers Market
2bed/1bath, 1045 sq. ft. Fairway Preserve condo	2bed/1bath, 1045 sq. ft. Fairway Preserve condo
List price: $169,000	List price: $47,500
overpriced homes extensive days on the market very few showings future foreclosure property	competitive price many showings multiple offers closing in less than 120 days
Average 6 month closed sales: $68,000	Average 6 month closed sales: $68,000
CHANCES TO SELL: 0 %	CHANCES TO SELL: 100 %

Location, Location, Price

What sells a home today? Price.

Take it from the horse's mouth...

Buyers: Don't make a low offer on a foreclosure property just because you want to pay less. often times you might be outbid on the home you really wanted only to save $5000. Look at the big picture. If you take a mortgage, how much would your monthly payments change? Is it worth to bargain? Remember, all the Lender wants is to sell the property. An independent Realtor has conducted a BPO(Broker price Opinion Report) on the property and established the listing price.

Work with a Realtor. A Realtor will be able to give a most accurate image of the market using closed sales and listing history. Build a relationship with your Realtor. Let them know what your needs are.

Sellers: Stop the bleeding! It's not coming back soon. This is the sad truth. Let's work together to get your home sold with the least pain and financial consequences. After conducting hundreds and hundreds of BPO's, I have a very good idea of where the market is heading. Most agents stick their heads in the sand and hope the storm will not ruffle their feathers. I am not most agents.

There are many ways for you to deal with the present market conditions without having to go through the foreclosure process. My team can evaluate your situation and help you decide what is best for you. Give me a call today for a free, confidential and no obligation conversation.

Asset Managers: Do you want your property sold? Look no further! I am a full time Realtor®, Auction Specialist, Platinum REOTrans Certified and Harris University REO Graduate. Learn more about me.

Investors: THIS might be a lifetime opportunity. Don't miss it. Call me today, let's talk about your portfolio.

December 2009: Foreclosure Market update

Southwest Florida real estate has followed the trend of the entire state with numbers of existing home sales increasing and the median price also trending higher. With prices now reduced off the highs of 2006 by 40-70% there are many buyers entering the market and they are not just tire kicking. Existing Home and Condo sales are now up for 10 months in a row and median prices have also started to come off the lows of early 2009.
Below is the Naples Area (adding Ft Myers and Cape Coral the trend is the same)

Pending Sales by Month. This chart goes back to January 2009. Some of the pending sales are backed-logged Bank Owned and Short Sales as these transactions are generally more lengthy to bring to a close. Some banks are streamlining the process and I see these types of transactions (which are the lions share of sales) shortening the offer-to-contract-to-close time as they become more standardized.

Did We Reach Bottom Yet?

I know everyone asks, when will (or did) prices bottom out, and the truth is there are many foreclosures in the pipeline yet to get through and resets on ARMs yet to come. However, the buyers ARE back and when the distressed properties are released, we are seeing multiple offers on many of them. Distressed sales (REO and Short Sales) are making up the majority of sales here and across Florida.

As you can see the last month on this graph has bucked the trend line that has been headed down for 2 ½ years. (This graph is for all Ft Myers down to Marco Island)

There are some neighborhoods that I believe will still trend lower, and some areas where there is so much buyer activity that prices are coming back up swiftly. For buyers who are coming into the market, the days of lowballing a property that has already been slashed to BELOW REPLACEMENT costs and having that offer accepted are over. There was recently one article in the paper about a broker getting 34 offers on one property! I do a market analysis of any property you are looking at and advise my clients to stay near that number. (If you don’t think the bank is doing the same, think again!).

Cash is KING...

Another strong trend is the cash buyers outnumbering the conventional and other financed purchases. (in many areas 2:1) See Chart for Finance Type of Sale.

MY READ...

My read on this….even though the economy in South Florida has not turned the corner, the buyers from Canada, Germany, and northern USA are not waiting to get the property they want….at the price it was 6-10 years ago. There is a backlog of retirees who have been sitting on the sidelines for a couple years while the prices came back to earth. The property they saw at 500k and 400k when they were shopping in 2006 is now 50-60% lower and they are jumping in.

About 1/3 of my clients are first time homebuyers who have now watched the dream of home ownership come back within reach. They are picking from inventory that is recently built and in some cases below the cost to build it!

There are 2003-2008 built homes on the market for $50-80 sq ft.

They are in competition with investors who are also prowling the market for deals that make sense at these prices. The cash sales I have transacted have been investors who are renting and/or doing basic rehab and relisting.

Real Buyers are Back

With the buyers back in the market, the overhang of inventory is trimming quickly. Especially the properties that are bank owned and short sales. The “organic” sellers are either having to match the market prices that the buyers are seeing in REO property or they will be holding on to their property for some time to come. The distressed properties that are not on the market yet will have the effect of keeping the prices low, so I believe that there is time to look around. I can also tell you, (and some of my clients reading this will tell you) that there are other like-minded people who are also pulling the trigger on purchasing their “place in sunny Florida” and you may have to make offers on multiple properties or bring the right number.

Real Estate Bedtime Story

I recently had a client tell me this story when he was debating whether to add 2-3% to his offer to get the deal done on a condo he had been wanting. Years ago, he was on an African safari and they were well into the bush and had camp set up. He said it was a luxury type safari and he was in his tent when a young local guy came to call on him. The young man explained that he was offering Hot Air Balloon rides at sunrise the next morning. “How much”?, this gentlemen asked the local. The boy replied that it was $400 and that he only had one spot left for the next morning. This client then told me that he had been a successful businessman all his life and prided himself on his negotiating skills: “I’ll give you $300” he told the young man, who said it was not possible for him to do the deal at that price.

So the man said, “I tell you what, you knock on my door ½ hour before you are ready to leave and I’ll have my $300 ready to go.” The young man thanked him and went away.

The next morning the man woke to the sound of air whooshing from the hot air balloon. He jumped up and went outside.

He looked at me and said, “What I saw was the most beautiful sunrise with this balloon rising silently from the floor of the savanna and I missed it over $100.”

“I learned a lesson that day that sometimes when you see something in life that will make you happy it is not worth fighting over pennies to make it happen.”

Don't miss this lifetime opportunity. There will not be a better time to buy a home. Call me for more information. 239-404-7576.