Archive for September, 2009

Is it possible to get financing these days?

Thursday, September 24th, 2009

A common theme that I am hearing when visiting people who are considering listing their homes is that they do not think that they should list their homes now.  They feel that it is pointless because “no one can get a loan”.  I believe that this thinking is totally incorrect. 

I agree that there are many news stories on the TV and in national publications (magazines and newspapers) talking about the difficulty that the lending industry is facing and the difficulty that some buyers are having getting loans.   However, obtaining loans is not a problem at all in today’s market IF AND ONLY IF the buyer can meet the big 4.  For people who bought homes prior to 2000, the big 4 are not going to be a surprise.  For people who only bought during the 2000’s or got used to the lending practices of the past decade, the big 4 may be a shock.  The big 4 are:

  • the buyer must put 20% down
  • the buyer must have good credit (I did not say great)
  • the buyer must have income to support the loan (make more than the monthly payment that is going to be due)
  • the property must appraise for what the bank is lending

These are not shocking and I would imagine that most reading this would agree with these 4 if they were a bank officer or considering seller financing themselves.  The notion of “no loans” has occurred because potential buyers got used to the following phrases (how many have you heard):

  • No money down
  • 110% financing
  • No documentation (this was always my favorite – here is $400,000 but we are not going to check anything)
  • 1% interest for the first 3 years

These policies created a lot of loans because the banks believed that the market would always go up so even if they gave a loan to a person who would default, they would be able to sell the property for a profit.  Unfortunately, this did not work out so well.  Now, there are many foreclosures and bank losses.  Lenders have gone back to safer lending standards but by no means are the standards tougher than the 1990’s.  Banks make money by lending.  Mortgage brokers and loan officers support their families by making deals happen.  There are a lot of people and companies with incentive to loan money…. but they want to lend to people meet the big 4.

Please contact us if you are interested in learning more about Punta Gorda real estate or visit our website to review neighborhoods or view available properties.

Has Punta Gorda real estate hit bottom?

Tuesday, September 15th, 2009

I was recently asked if we have “hit bottom”.  I don’t think that there is a more loaded question for a Realtor.  If I say “Yes” and the market drops in 5 months, I look like a misguided fool and if I say “No”, I am called a pessimist who does not believe in the product (the local real estate market).

However, since I like to live dangerously, I am going to address the question.  I think that we have hit a leveling off period which may be the bottom of this drop.  The number of actual sales in Punta Gorda / Port Charlotte in 2009 is much higher than our number of sales in 2006, 2007 or 2008.  There are more deals happening which is good in two ways.  First, it helps to reduce inventory.  Less inventory means less competition from other sellers which means less pressure to reduce pricing.  The second benefit of more transactions is simply a building of consumer confidence.  It is becoming “all right” to buy real estate again.  For 2-3 years, buying real estate was not seen as a wise move.  Now, however, the statistics say that more people are buying real estate.  The summer is not typically our busiest time of year.  However, this year’s summer was busy.  If that continues through the winter and spring, we may be a much healthier market in May 2010.

Two positive sidenotes:

  1. Money magazines article ranking our area as the number one place to retire brought positive press to our beautiful area
  2. There have been many articles in Forbes magazine, the WSJ and others suggesting that real estate is one of the best hedges against inflation.  Good or bad, many of the people that I am talking to think that inflation is coming.  If it does, there are countless advisors saying “Get into Real Estate to protect against inflation”.   If we are going to have inflation (which I am not rooting for at all), at least I am in an industry seen as a hedge.

Visit our website to learn more about Punta Gorda real estate. You can search the Punta Gorda MLS or  read about Punta Gorda area neighborhoods. It is a one-stop resource when buying or selling Punta Gorda property.

Punta Gorda/Port Charlotte Board of Realtor Stats

Monday, September 14th, 2009

They say that statistics can paint any picture, any color depending on the interpretation.  I will do some of my own hypothesizing of the Punta Gorda/Port Charlotte/North Port Board of Realtors statistics released last week.  

There are some interesting numbers.  For example, within the Board covered area, there have been 2,030 single family home sales through August 31st.  This is way off of the totals for 2005 but is 230 more sales than at the same date in 2008.  More sales are better than fewer sales because it means that more buyers are taking the plunge and hopefully, inventory is being reduced.

Some other interesting parts of the data:

  • 2,030 single family home sales through August 2009 (better than last year)
  •  Only 5 of those 2,030 were at sale prices higher than $700,000 (not good for sellers asking high dollars)
  • 211 of the sales were between the small sale price range of $100-$119,999 (no wonder the median price for our area has dropped so dramatically)

This data is for a wide geographic area so PGI/BSI only make up a fraction of the data.  However, sometimes it is good to look at the stats for the entire area.   View the PG-PG-NP August 2009 Stats here.

Who’s Buying Punta Gorda Real Estate These Days?

Tuesday, September 8th, 2009

We have seen a bit of a shift in the type of buyer for the Punta Gorda – Port Charlotte market buyer over the past year.  I do not think that this is a long-term/permanent change but it has definitely affected our sales somewhat.  In the past, a percentage of our typical buyers were “snow-birds” or seasonal buyers.  These were buyers who would come down to our area and buy a home or condo to use during the cold winter months up north.   Typically, they would arrive in November and leave in April.  Our market still has many of these property owners.   Unfortunately, over the past year, that number has not grown much.

The percentage of sales to end-users (full-time residents) has risen in comparison to the snow-bird buyer.  This is due simply to the national economy.  A second home/seasonal purchase is a discretionary expenditure.  We all may want a second or third home but none of us NEED it.  With the economy as uncertain as it currently is, many of the potential snow-bird buyers are telling us that they are going to wait a year on the sidelines and rent for a season until they know how things are going to shake out.  Many have the resources and desire to purchase a property in Punta Gorda/ Port Charlotte but are nervous about their retirement accounts or how long that they will continue to be employed.  With concerns like those, it is easy to understand why they are not jumping into a large discretionary purchase.

A positive aspect to this is that the seasonal rental market is stronger.  When talking to rental agents or investors who have seasonal rental property, they have all stated that their inquiries are up this year and that they are holding much tighter on prices.  That is good for our market because it shows that we are still a desirable place.  When the national economy stabilizes, I am hopeful and expectant that many of these “on the sideline” potential snowbirds will turn into buyers and provide a boost to our overall market.

Visit our Punta Gorda Real Estate website for more information on the Punta Gorda/Port Charlotte area. View available listings, read about neighborhoods or learn about our lifestyle.

Punta Gorda Market Update-September 2009

Wednesday, September 2nd, 2009

Sometimes it truly does depend on how you look at the situation to decide if it is good or bad.  The Punta Gorda Isles/Burnt Store Isles (PGI/BSI) real estate market has good news, bad news and some that I am not quite sure is which. 

Transactions in Punta Gorda Isles and Burnt Store Isles are definitely up.  There are simply more buyers buying properties which is good for any market.  Whether the buyers are back due to pent-up demand, lower prices, more confidence in the economy, or lack of any real hurricane threats is anyone’s opinion. 

An example of the up tick in transactions certainly can be seen in Burnt Store Isles.  In 2008, there were 24 single family residential homes sold.  Through September 1 of 2009, there were 24 single family residential homes sold with 6 currently in Pending.   With 6 in Pending and 4 more selling months, there will certainly be more homes sold in Burnt Store Isles this year than last.

However, this up tick in transactions has not resulted in appreciation.  I believe that this is due to the still very high amount of properties for sale (inventory).  In August 2008, the average sale price in PGI/BSI was $414,856.  In February 2009, the average sale price was $379,765.  In August 2009, the average sale price was $359,780. 

Good news – more sales due to more buyers
Bad news – prices still dropping due to very high inventory

For more information about the Punta Gorda Real Estate market, visit our website. You can view new listings by neighborhood, see all available properties organized by neighborhood, search all properties available in Charlotte County or even view Just Sold reports for many area neighborhoods.