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Price Your Home in Today's Market

by Doug & Gwen Campbell at Sun Bay Associates

The question of how to price your home in today's market is very important in today's Tampa Bay real estate market.  Unlike just a few years ago when a home might be priced a little higher than market value and the market would catch up to it.  In today's real estate market, especially in the Tampa Bay real estate market, pricing is critical.  If a home is priced above market value today, it is already on life support because prices are still falling and the market train has already left the station. 

The role of the realtor is perhaps more important than in the past many years since sellers may not be aware of the true market conditions, or may be in total denial of the actual market conditions and a professional realtor will provide the dose of honesty needed to get a home priced right and sold.

In the Tampa Bay real estate market, the median sale price of a home in April of 2006 was $220,000.  Today, in the same Tampa Bay real estate area, the median sale price of a home in April of 2011 is $125,000.  Even only one year ago, the median sale price of a house in the Tampa Bay real estate market in April of 2010 was $134,000 and in April of 2011 the mediam sale price of a house is $125,000.  This is a 6.4% decrease in market value in only one year.  In almost every instance, it is foolish for a seller to insist on setting a list price above market value, or above what the house may have sold for only three years ago.  To do so is setting up the seller for failure and will almost surely cost the listing agent time, money and reputation.

Another way to look at price and how competitive it has become is to look at what is on the market today in the Tampa Bay real estate market.  For instance, in the $200,000 to $249,999 price range, there were 1,758 single family homes for sale in April 2010.  Out of those 1,758 houses for sale in that price range, 38 sold in April.  That means that 1,740 did NOT sell.  For most folks, that is a big number and indicates how competitive the market is, and how vitally important it is to price a house correctly.  Failure to do so is almost sure banishment to the lingering death of an expired listing that over six months can cost the seller another 5-10% in value. 

In no price range was the rate of sales compared to listings as high as 8%.  This means in every price category in the Tampa Bay real estate market, more than 90% of the homes for sale DID NOT SELL.

The moral of the story is you can price your home correctly today and get it sold, or you can price it where you "need" it to be, and watch the market pass you by and find better value somewhere else.  This is a harsh lesson.  The current market is harsh.

Act now, be wise and be ahead of the market so when the buyer comes along, you are there and not outside hoping to get a straggler.  PRICE IT RIGHT!!

If you would like pricing information on a neighborhood, visit Sun Bay Associates Market Snapshot for a free and very comprehensive report.

Has the Real Estate Market Stabilized?

by Doug & Gwen Campbell at Sun Bay Associates

Has the Florida real estate market stabilized?  Has even the Tampa Bay real estate market stabilized?  The answer is maybe, but probably not.  Nationally the media is saying the recession has bottomed out and we are beginning a recovery.  That is very good news.  The not so good news is that Florida and the Tampa Bay area were hit so hard, especially by the housing slump, that it may take longer for the real estate market in the area to bottom out and thus begin a recovery.

The Florida economic recovery may be longer because layoffs are continuing.  There are 15% more families receiving welfare assistance in Florida than were a year ago, according to the St. Petersburg Times.  Florida's unemployment rate is over 11% compared to the national average of 9.5%.  With all this bad news, there is good news since the number of houses sold in June was up for the first time in many, many months.

As the national recession abates, the Florida recovery will follow, eventually.  Stabilized house prices are a very good sign that the Tampa Bay real estate market may be improving as reported by the Florida Association of Realtors, but one month does not a trend make.  Many experts are predicting that even in Florida the real estate market will stabilize by the end of the year.  We certainly hope so.

To Stage or Not to Stage

by Doug & Gwen Campbell at Sun Bay Associates

So you think that everyone who comes to your home will just adore your decorating style.  Well, the fact of the matter is that they probably won't.  This is where home staging comes into play.  If you are into antiques, lace curtains, with lots and lots of things all over your home, no matter how expensive or even tasteful, you run the risk of turning off far too many potential buyers.  Whether they like the neighborhood, the location, or even the floor plan of your home, if you have too many personal items on display, the focus becomes on the things on display and NOT on your home.  And the home is what you are trying to sell, not the things on display.

So let your realtor provide you advice on the best way to showcase your home.  Or better yet, invest the money to hire a professional home stager.  The professional home stager will consult and provide you excellent advice on how to have your home shine.  For a vacant home, having it well staged gives you, the seller, a definite advantage in the market place, since too many buyers have a difficult time envisioning how an empty room might be used.

To start, take as many personal photos off the wall as you can.  If you have a specific hobby, whether it is hunting, race cars, martial arts, or knitting, put these items away and out of sight.  When someone is coming to look at your home, turn on the lights and make the room temperature as comfortable as you can.  Sweep the floors.  Put your pets away, or better yet, take them out for a walk when a buyer is coming to preview your home.  Make the home smell fresh and clean, or simmer a pleasant spice on the stovetop, such as cinnamon, to give your home a welcoming aroma.  Take your personal hygiene items off the bathroom counters and out of sight.   Keep the house neat and tidy with as little clutter as possible.  It may help to rearrange the furniture to make the rooms look more spacious.  Here in the Tampa Bay area it is alright to have some emphasis on the wonderful beach lifestyle, but be sure not to go overboard.

Your goal is to have the house speak for itself by being clean and airy with lots of open space, and showing its maximum appeal.  Don't let clutter, your hobbies or family photos take away from all the advantages of your home.

Bank of America revises short sale policy

by Doug & Gwen Campbell at Sun Bay Associates

One of the nation's biggest mortgage lenders, Bank of America, has said it is loosening its policies on short sales.  This announcement came as a response to the U.S. Treasury Department'sannouncement last week that is would increase incentives for lenders to work out short sale deals.  With the number of short sales in Florida and especially the Tampa Bay real estate market, this is a very good step in the right direction to reduce the number of houses on the market that are subject to foreclosure.

David Sunline, a Bank of America real estate management executive, says this action is a boon to banks because it provides guidance when there are multiple liens, which is a potentially litigious issue for lenders.

In the past, the bank followed Fannie Mae's policy of giving second lien holders about 10 percent of the second mortgage in a short sale.  Now, when it holds the second lien, BofA will accept 5 percent of the net proceeds of the short sale, Sunline says.  When BofA is the first lien holder, it will offer 5 percent to the holder of the second lien.

Mr. Sunline says homeowners considering short sales should contact the bank within five days of getting an offer on the home and expect its cooperation as long as the offer is within the range of other sales in the area and the borrower can demonstrate financial hardship.

Article Source: The New York Times.  Bob Tedeschi.  5/15/2009

Rent, hold or sell in the current Tampa Bay real estate market??

by Doug & Gwen Campbell at Sun Bay Associates

In the current market lots of homeowners are upside down in their homes.  They have to ask themselves do we want to sell our house at the current market value and lose our equity, or even have to do a short sale just to get out of the situation, can they rent the house for a while until the market comes back, or should they just sit tight and hold on to their home until the market improves. 

The answer to these questions is "It depends on the situation."  For the homeowner who is farily comfortable financially and has no real pressing need to move, it may be the best course of action to do nothing and continue living in the house for a few more years.  For the homeowner who needs to sell, for whatever reason, whether it is a growing family, job change, health, and they do not want to sell at the current market value, renting could be an option. 

Experts are speculating about the recovery of the real estate market.  Some say we are near the bottom, others, such as PMI, the company that insures mortgages, estimates two more years of price decline, at least in the Tampa Bay area.  PMI did not just throw a dart at their estimate, but analyzed Florida foreclosures, unemployment and other data from the last quarter of 2008.  Other experts are predicting that Tampa foreclosures will increase in 2009 especially as unemployment continues to go up in the Tampa Bay area.

At a recent conference in Orlando, Florida, David Gergen, former presidential advisor and currently a professor of public service at Harvard's John F. Kennedy School of Government, predicted that the housing recovery would look like a saucer or soup bowl. that is an eventual leveling at the bottom, but staying there for a while and then there will be a very gradual recovery.  These predictions indicate that if someone decides to rent their home now, it may take another two years of decline, then with the gradual real estate recovery, two or three more years for prices to get back to today's level.  So the homeowner who opts to rent until the market recovers may have to rent their house, act as a landlord, for 3-5 years to just break even, if inflation is not taken into account.

If there is little to no equity in the house and the owner has a negative cash flow, holding or renting might be risky strategies.  A loan modification could work, selling at a loss if the owner can sustain a financial loss, a short sale - if the bank is willing, or going to foreclosure are other options.  In every case, serious consideration of the consequences, including the unintended consequences, must be carefully evaluated.

For specific legal advice, or financial advice, you should contact your attorney or accountant.

Displaying blog entries 1-5 of 5

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Photo of Gwen and  Doug Campbell - Sun Bay Realty Group Real Estate
Gwen and Doug Campbell - Sun Bay Realty Group
at Keller Williams Realty
30522 US Hwy 19N, Suite 107 S
Palm Harbor FL 34684
Doug's Cell 727-741-4189
Gwen's Cell 727-741-7260
Fax: 888-447-7908