Central Florida Real Estate Blog

I'm sure that many are asking the same question.  I continually keep on hearing that the buyers are waiting for the market to settle down.  Buyers are waiting for that killer deal.  Buyers are waiting....

OK, so we've had a reality lesson for sellers.  It's time for a reality check for buyers.  In the Central Florida area, as I am sure with many parts of the country, the real estate housing market has settled down.  Yes, there is a great deal of inventory out there, but homes are being sold.  Granted, not at as fast a clip as the past few years.  But let's get realistic, that was an anomaly.  I doubt if we will see anything like that for a very long time to come. 

Sellers seem to be somewhat more realistic in that they are pricing their homes accordingly.  I don't know what so many have in their minds that the market still needs to adjust.  It did that last year and that was really finalized by the end of the year.  Prices aren't dropping.  They shouldn't.  There are some great values out there.  You can actually purchase a home now and walk in their with some equity.  Not like what we saw in '05.  This is the way a normal market is supposed to operate.

Prices are not going to go down lower & the interest rates have remained quite low also.  This is a great time to purchase a home.  There is generally price and value built into these homes.  If there isn't, then move on to the next property.  There are enough out there to choose from. 

I know some are now blaming the sub-prime market, but then again, these are people that are just always looking for something to blame.  Yes, the sub-prime market took a hit.  Well, heck, they shouldn't have issued so many risky, really risky loans.  But, there is money out there for people with ‘B/C' credit.  It can be found. 

Hello folks, the market has bottomed out.  It's as simple as that.  It has turned the corner.  I'm not just saying this because I would like some buyers.  The stats prove this out as do some of the articles finally being put into print. 

I just sold a couple of homes within 45 days in this market.  No, they were not underpriced.  But, we were able to show Price & Value & everyone walked away from the tables feeling like a winner. 

Til next time - Marc It Sold!

Most realtors when asked, will say that they are in the business of selling real estate.  If this is your answer, than you may not be working up to your full potential. 

Personally, the selling of real estate is a by-product of what we do & that is being in the 'People Business.'  We help bring buyers & sellers together & for people to achieve a certain goal.  Too many realtors, lose sight of this.  Sometimes just getting caught up in your own business. 

As with any business plan, you should have a Mission Statement as well as a Vision Statement.  The later will have a broader meaning, whereas the former will be more specific.  These should be short & pithy.  They should be repeated daily until they are rote. 

This will help promote your business for you will be promoting it from within you.  It has to be innate.  You will be the epitome of real estate and this will show through to the people that you meet.  But for this to work it has to come naturally, it can't be forced. 

I've always felt in dealing with people, negotiations and clients, that you've succeeded if everyone who walks away from that table feels that they gotten a good deal.  I can't say that this will happen 100% of the time, but it should happen the majority of the time. 

This to me is success!

There was a blog a few days ago authored by Judy Cicalese entitled, How do you know when it's time to give up a listing? soliciting comments from us as to when is the time.

In too many instances, the time is before you even take the listing, especially in our present market.  I'm located in the Greater Orlando market and we have a much healthier market than most areas of the country.  We all want listings, but I don't understand why someone would take an overpriced listing just to have it languish on the market with your name rider on the yardarm.  Yes, I do agree that exposure is great and that is what promotes us as realtors, but there is a limit.  Don't you think that when people see your name on a yardarm for an extended period of time, that they won't question your efforts (marketing, etc.) as a realtor?

I've continually mentioned that to sell a home within a reasonable amount of time in this market, that you have to show 'Price & Value.'  Yes, there are many more factors, and I know that Price & Value are not on the top of the list as reasons for consumers to purchase a home.  I've always felt that for a home to sell it has to be sold twice.  First to the realtor and then to the consumer.  I rarely forward overpriced listings to my prospects, unless this home just totally suits their needs.  There are too many other goods values out there.  I don't have time to waste showing a listing where the owner needs a reality check. 

I've been working with a prospective seller who wrote to me that she wanted to price her home high so that she has more room to come down in price.  I viewed the home for her out of courtesy, since she is an absentee owner who bought the home for her children to attend college.  Before I went out to this home I wrote her that there was a good chance that I would not take the listing due to what she wrote me.  She understood that I might not wish to waste the excess time on her listing, but she did not understand there is a price to pay. 

It costs us money for a listing - there is the yardarm, producing marketing materials, virtual tours, etc.  There is also the possible future cost to us if that listing languished on the market for too long.  Yes, your name may be remembered from people consistantly seeing it on the sign, but will they call you?  Don't you think that there might be a negative connotation given to your name for being out there so long?  Don't you think that people might infer that this may not be the realtor for me?  You know that they will be wondering why that home was on the market too long.  Some may know the reason, but how about all of the others that don't know the story behind it.

What I do when I take a listing that the seller wants to price somewhat higher than I feel is to write in the listing agreement that the home needs to be reduced to the price that I suggested in 2 weeks time.  This, of course, is dependent on the amount of traffic, realtor feedback, etc.

I apologize if I may seem to negative to some here, but we are the professionals.  Our industry, unfortunately, gets too much negative publicity.  It is our job to educate the public. 

How many times has it happened that you may have taken an overpriced listing and then was meek about calling the seller and telling them that you needed a Price Improvement?  It's best to address that at the beginning.  Why put yourself in that position? 

Thanks again for allowing me to rant!

Best Regards to all.

It's just absolutely amazing to me that people must think we are stupid.  Here are two things in particular that I've just come across. 

My last post had to do with the Florida property tax issue.  This morning I received an email from a realtor in Miami that must be a supporter of Marco Rubio, the House Speaker.  Let me just give you a brief history here.  He is proposing that we eliminate the property tax on primary residences & reduce the property tax on other properties by 20%.  To offset this revenue loss he is wishing to increase the state sales tax by 2.5%.  Ok, so here's what their website states, "Lower taxes and lower tax rates on apartment buildings and other businesses will reduce rents and keep rental housing affordable."  Who is kidding whom here?  Let's say you have a landlord who is receiving X dollars for rent on a unit & the property tax on that unit is reduced.  Do you think that this landlord will reduce the rent below the X dollars that are getting now?  But yet, there they have it in writing trying to persuade you to their point of view.  They will get some people to believe them & I guess that this is enough - that is what they are after.

OK, enough of that one.  Here's another I encountered the other day from an insurance agent.  I decided to shop around because the insurance on my primary residence just went up way too high and too fast.  Again, a brief history, I decided to change agents a couple of years back.  The main reason for this is that I needed an Umbrella Policy to better protect my interests & myself.  Two years ago, I paid $860 yearly insurance on my primary residence, which was higher than I'd previously paid, but was willing to do so.  Last year, this increased to $1030 & this year my renewal came in at $1453.  I had one claim back in '08 & the home is just over 10 years old. 

So now to the story, I was shopping around and speaking to an agent.  She said to me that our rates would not be this high right now if insurers were charging the correct amount all along.  She further stated that our insurance rates in Florida have been much too low for too long.  OK, so here's my issue with these statements.  Insurers have actuaries work for them.  These mathematicians create formulas that the insurers use in rating risk.  Risk is the underlying factor in insurance.  Things are cyclical - whether we are talking about the weather, life, real estate - it really all is very cyclical.  So, getting back to insurers, do you think that they are not going to charge us enough to cover their risk?  Seriously, now.  This is what this woman was telling me. 

The insurers ran this garbage back after Andrew in '92 and again after all of the '04 hurricanes.  Granted, '04 was an anomaly, but how many years did we go without any severe storms that cost the insurance companies.  If you look at their books, you will note that they are still making a profit. 

Anyway, enough of my ranting!  I just really ticks me off when people think we are stupid.  It's fine to get your point across, but be realistic.  Don't make it out that we are stupid!  That is just such a lack of respect & that is something that I will not deal with.  We all deserve respect!

Thanks again for listening to my meanderings. 

Until next time - Marc It Sold!

I obviously haven't written in a couple of months.  It is not that I had not wanted, but did not wish to write about the same topic that has been so prevalent, the local market.  I was firstly concerned about the negativity that some may derive from this, even though we are in a quite healthy market in Central Florida.  I also needed some more inspiration to write. 

A client of mine had suggested that I write about the property tax issue that we are experiencing.  My first thought & reply was ‘no'.  I did not want to write about such a controversial topic.  Now, many of you who know me, would be surprised by this response.  And you would be rightly so.  So, here goes. 

I am not aware of what is happening in other parts of the country, but here in Florida we are in the midst of a property tax system that is quite flawed.  My concerns are varied, but one major concern is that the politicians will try to do a quick fix & tell us what a wonderful job that they've done in saving us money, only to cost us more in the long run down the road. 

There is history behind this, which I've previously written about.  We have in Florida SOH (Save Our Homes), which was passed in 1992.  This limited the Taxable Value of your home to a 3% increase, if such is your primary residence.  The purpose of this tax measure was to help the elderly from being taxed out of their homes.  Unfortunately, even though this may have helped accomplish that task, it more benefited the well to do with expensive mansions, etc.  They received a larger benefit. 

Now, many proposals are being pandered about to supposedly fix our flawed property tax system.  But to fix a flawed system with an equally flawed system is ludicrous. 

One of the main proposals is to eliminate our property tax (on your primary residence) and have this replaced with a higher State Sales Tax.  While some may feel that this is fair, it really isn't.  Again, the people that will benefit the most as those that have.  The people with the mansions (big expensive homes or whatever you wish to call them) will benefit the most.  The people that don't have, those in the lower income brackets, will end up paying more via a higher sales tax and if will affect their pocketbook more. 

Not only that, but this is just as inequitable to the renters.  They too will be paying a higher sales tax and they are not even property owners.  Some may jump the gun and say well everyone should have a larger share in paying for governmental services.  But you have to remember that the owner of that apartment complex is already paying property taxes, they would not be exempt if there were a repeal of the property tax laws for primary residences. 

It's also been talked about that a Florida resident should be able to take their current SOH with them when they move; and, generally to a more expensive home.  This would only worsen an already flawed system. 

And doubling the homestead exemption is not really the answer also.  The property appraisers are already shoring up their books and the tax rolls for a change.  It generally used to be that the ‘Just Market Value' on the property appraiser's tax rolls was approximately 80% of the fair market value on the open market.  With the increase in home values that we've seen over the past several years, this number became a much lower percentage.  But if you check out the property ‘Just Market Values' now (Orange County, in particular), you will see that many are at approximately 89%.  So, you can see that the property appraisers are already trying to shore up values depending on what happens in the legislature. 

Let me put this in another perspective.  I have a friend whose home is on the market.  They purchased the home 10 years ago and their property tax for 2006 with the SOH & Homestead Exemption came to $844.  A prospective purchaser asked me what their taxes would be & when I figured it out I was totally astonished.  Now, let me preface this first in that this is a lovely home, albeit under 1300sf in a middle class neighborhood.  For the new buyer, their first year taxes would be almost $3200 and this is with the Homestead Exemption still in place. 

You also need to be wary, because according to the property appraiser's website, the Assessed Value of this home with the SOH went up 15%.  What happened to the 3%?  Most people wouldn't even know.  They don't check their tax bills.  It is generally escrowed in with your mortgage payments. 

Let's take a couple of steps back for a moment.  Let's say that the property tax on our primary residence is eliminated.  What do you think will happen a few years down the road when they realize that there is not enough revenue coming in from the sales tax?  I can tell you what I think - lo and behold, we will find ourselves with another property tax.  What do you think will stop the legislature in doing that?  By that time, we should have another administration in office and the blame will be put on them.  Think about it!!

Additionally, there is another aspect to consider.  With the elimination of a property tax, there would be a loss of jobs in that there would be less need for the local property appraisers and tax collectors.  Now the monies would be going directly to the state and then funneled down to the local counties & municipalities.  Granted, I'm sure there is a lot of ‘fat' at the lower levels of government as there are at the upper levels.  Maybe, this might be good in that they would have to trim a lot of that since the monies would now be coming from elsewhere.  And maybe there would have to be more accountability.  Only time will tell on this issue. 

So, this is not an easy fix.  But it also cannot be a quick fix.  In doing so you will only be replacing one flawed system with another.  What purpose does that serve, except for someone in power saying that they did something?  Well, whoop de doo!  If doing so leaves us in a similar or worse situation down the road, have you really helped anyone?  Or are you really only helping your cronies?  Beware, there are many lobbyists & PR people out there that will try to sell us a bill of goods.  Just be wary!  Be very, very wary as Elmer Fudd might say. 

Until next time - Marc It Sold!