A Market With Retreating Prices In Florida
The News Press reports from Florida. “The median price of an existing home sold in Lee County edged up in April, but experts say that’s not the whole story in a market flooded with inexpensive houses. Real estate broker Denny Grimes said the higher median doesn’t translate into a recovering market. ‘It only takes a couple of sales higher than the median to push it from $269,000 to $283,200,’ he said. ‘Prices in our market are still going down.’”
“One seller agreed that prices are far below what they were when the market reached its peak in December 2005 with a median price of $322,300.”
“‘It’s a horrible market,’ said Keith Olson of Fort Myers Beach, an investor who lost $90,000 on one Cape Coral house he sold recently and expects to lose $70,000 when he closes on the sale of another one next month.”
“There’s no indication that higher prices are in the offing anytime soon, he said. ‘The next 90 days will be golden days for buyers.’”
“Fred Elliott of Coldwell Banker Preferred Properties in Lehigh Acres said…sales appear to be increasing, in part because ‘We’re seeing more bank foreclosures than in the past and they’re getting more realistic with bank-owned properties and short sales.’”
“Peggy Hummel, CEO of the Realtor Association of Greater Fort Myers and the Beach, said the association’s statistics show that ‘we’ve got about a 15-month supply of residential and 18 months of condominiums,’ so the inventory of unsold homes should be gone by late 2008. ‘The market should be back about 2009.’”
The Miami Herald. “Richard Coren thought his three-bedroom house in Pembroke Pines was worth about $420,000 when he put it up for sale in November. And he appeared to be the only one. After it sat for six months on the market, Cohen knocked about $40,000 off the asking price and found a buyer willing to pay $383,500.”
“‘I figured if the market was bad, I had to change with the times,’ Coren said, recalling how his real estate agent urged him to ask for less money. ‘We got instant activity as soon as I took her advice.’”
“Coren was one of the 580 people who sold a house in Broward County in April, 16 percent fewer than did so a year ago, the Florida Association of Realtors said Friday. Miami-Dade County’s housing market took a much bigger dip: Single-family home sales plunged 37 percent to their lowest level for April in at least 10 years.”
“Cyndy Wald listed Coren’s Pembroke Pines house and was the one who told him that his original $420,000 asking price was ‘yesterday’s news.’ ‘We’re still in this correction phase,’ Wald said, using a term for a market with retreating prices. ‘They have to price it very competitively.’”
“The buyer’s market that took firm hold of South Florida’s housing market last year extended its grip in April. Esslinger-Wooten-Maxwell reported unsold inventory has grown 9 percent since January to 76,063 units in Broward and Miami-Dade counties.”
“But the 12-month figure shows how much things have changed: unsold inventory grew 36 percent in Broward since April 2006 and a full 53 percent in Miami-Dade.”
The Herald Tribune. “Although local housing inventory stubbornly hovered near record high levels, the Sarasota-Bradenton market was the only market in the state to show positive sales growth for April. The news was not as bright further south in Charlotte County-North Port, where April sales fell 15 percent from a year ago and median prices dropped 12 percent.”
“‘We were among the first markets in the state where a unified real estate community counseled sellers to price realistically and to not expect the windfall profits we saw during 2004-05,’ said Michael Saunders, president of Sarasota’s Michael Saunders & Co.”
“‘There was considerable resistance at first, but we have steadily chipped away at that resistance as sellers saw properly priced homes sell much faster. The numbers tell the tale,’ she said.”
“While some Sarasota sellers may be asking for the moon, the Port Charlotte-Punta Gorda market is yearning for the past. Waterfront specialist Florence Tanner in Punta Gorda, says she sees more activity in the starter home market than in waterfront, which is bringing down prices on the more expensive waterfront properties.”
“‘Someone who is looking for a waterfront property, you can find one for under $200,000 now in Charlotte County,’ Tanner said. ‘Here is one that is one bridge to open water, and it’s only $179,000.’”
“The condo inventory was in the upper 4,000s until mid-April, when it broke above 5,000, and it has stayed there since. As of May 15 there are 5,207 condos for sale and only 383 deals pending.”
“Broker Albert E. Horrigan, said: ‘It’s not the end of our current market downturn.’”
The News Journal. “Existing-home sales in Volusia and Flagler counties fell 25 percent in April compared to the same month a year earlier, but the median sales price dropped by only 7 percent over the period.”
“‘I think we’re getting back to what the market was before it got crazy. We’re seeing some good price reductions, and when prices come down, houses are selling,’ Don Wood, president of the New Smyrna Beach Board of Realtors.”
“Ray Arriana said he is offering $10,000 in incentives to be used however a buyer wants. His three-bedroom, two-bath house has been on the market about six weeks, but lenders have tightened their guidelines. ‘I would have had a contract (a couple of times), but the credit keeps falling through,’ Arriana said.”
“‘Lenders certainly are tightening up their guidelines. The days of buying a house with no money down and poor credit are pretty much over,’ said Stephen Bradt, owner of M & R Mortgage Services in Orange City.”
“While Southwest Florida’s prime real estate season ended on a relatively high note, developers and Realtors are scratching their heads about what they can do to keep drawing buyers in a wobbly market.”
“It is not easy to grab attention for a listing when there are more than 13,300 properties for sale on the Sarasota MLS alone.”
“Premier Properties, a Sarasota player and part of the much larger Naples company of the same name, opted to sponsor an open house featuring Diane Ahlquist, a psychic and author.”
“So, did Ahlquist encourage Realtors to bring their psychic powers to bear on selling? Sort of. ‘We all have intuitive abilities, which are like muscles. The more you use them, the stronger they get,’ she said, advising Realtors that when considering a possible listing, ’stop at the front door for a moment.’”
“‘Ask yourself, ‘Will this sell?’ or ‘Will it be nothing but a headache?’ Ahlquist said. ‘Use intuitive power to determine how to deal with buyers and sellers or even to determine if you should take a listing.’”
“Ahlquist capped off the evening with an announcement that she and her husband had put their home on the market. When asked, in that beautifully appointed room full of Realtors, whether her sponsor Premier was handling the sale, Ahlquist could have used the power of clear thinking, it seemed, before answering.”
“‘I am doing a FSBO.’ For sale by owner? The party was over.”
‘For months, as Coast Bank’s stock plunged below $3 and hundreds of homes loans veered toward default, federal regulators held their tongues.’
‘They broke their vow of silence dramatically Friday by forcing the resignation of president Brian F. Grimes and accusing the Bradenton bank of ‘unsafe and unsound banking practices and violations of law and regulations.’
‘Existing-home sales in Florida and across the nation continued to fall in April, and industry analysts said the subprime-mortgage market meltdown could foreshadow further weakness. Florida’s home sales plunged 26 percent to 12,016, and the median sales price slipped 3 percent from the same time a year ago to $237,800, the Florida Association of Realtors reported Friday.’
‘Metro Orlando sales were off 35 percent and the median price dipped 5 percent to $250,300. Condo sales for the four-county region plummeted 57 percent to 207, and the median price slipped 7 percent to $166,100.’
‘Beth Barnett of the Lakewood Ranch office of Coldwell Banker said the latest sales figures jibe with what she has been experiencing.’
‘I had five sales this month. We are definitely picking up on our sales and the prices are coming down. The lowest price on the street per square foot are the homes that we have gotten the contracts on. If the sellers are aggressive in their pricing, they will sell,’ Barnett said.’
‘…federal regulators held their tongues.’
‘They broke their vow of silence dramatically Friday by forcing the resignation of president Brian F. Grimes and accusing the Bradenton bank of ‘unsafe and unsound banking practices and violations of law and regulations.’
Barn door wide open
Now all the horses are gone
Quickly shut the door
“There’s no indication that higher prices are in the offing anytime soon, he said. ‘The next 90 days will be golden days for buyers.’”
I think he meant the next “90 months”
Received an e-mail last night from a friend in Virginia who owns a second-home oceanfront condo in Cocoa Beach. Based on the peak price in his complex reached in 2005 or early 2006, the latest directly comparable unit sold for 27% less. And apparently there’s no sign of the correction easing.
‘Prices in our market are still going down.’
Ben,
Isn’t this the same Florida post that you made yesterday?
And the day before?
And the day before that?
The Florida housing situation is starting to feel a lot like the summer of 2000 for tech stocks, when I watched the CNN/Money screen show a falling NASDAQ stock market index day after day after day.
“To-morrow, and to-morrow, and to-morrow,
Creeps in this petty pace from day to day,
To the last syllable of recorded time;
And all our yesterdays have lighted fools
The way to dusty death. Out, out, brief candle!
Life’s but a walking shadow; a poor player,
That struts and frets his hour upon the stage,
And then is heard no more: it is a tale
Told by an idiot, full of sound and fury,
Signifying nothing.”
–From Macbeth (V, v, 19)
The April FAr numbers were something of a milestone, IMO. A lousey end to what was supposed to be the spring salvage of the market.
The reason it wasn’t covered much was the unusual Friday data release that was overshadowed with a holiday.
“‘It’s a horrible market,’ said Keith Olson of Fort Myers Beach, an investor who lost $90,000 on one Cape Coral house he sold recently and expects to lose $70,000 when he closes on the sale of another one next month.”
Aha! The first sign of the bottom — one invester has called the market ‘horrible.’ Once the rest of the country is publicly repeating this received wisdom, it will be time to start looking at homes to buy, if anyone remains interested and qualified at that point.
One of the worst drives in Florida has got to be Del Prado Blvd. in Cape Coral from Rt. 41 to the water. Agony, sheer agony.
Funny you mention that.
I was in Cape Coral last week and drove south on S Chiquita from the 78 to the water. I couldn’t believe my eyes!
If I am not mistaken, Cape Coral is where the infamous Jeff from SDCIA owns three albatrosses, which are strangling the life out of him.
You are correct. It’s a horrible mess down there.
Yes, for some reason, probably word of mouth, specuvestors from Sandyago descended on Cape Coral. I ran into a couple of them just by chance, in unrelated business transactions. This was two, three years ago. I naively asked one of them what the heck they wanted in Florida if they lived in Sandyago (which I think is one of the greatest spots in the US). I got smarmy grins and the response was “Oh, no, I don’t LIVE in Florida, I just INVEST here.” It was acknowledged that they couldn’t make money in real estate in Sandyago anymore, so they came here to do their vulturing.
When we lived in Sarasota, someone we know moved to the Cape Coral area and fairly quickly got caught up in the flipping mentality. He invited my wife and me down to look around so we could get in on the action as well. All I could see was several square miles of a grid of very narrow, mostly paved streets, with an occasional house or mobile home on a tiny lot, and a network of ‘fresh water canals’ (drainage ditches) behind each lot. We thought, “We know this guy is smart, what the heck is he doing ‘investing’ when there’s an obviously endless supply of these dumpy lots?”
I know he bought at least four or five and managed to sell all but one, which he still has. He acknowledges that he will probably never be able to sell it for what he paid.
I’m pretty sure this is the same “community” where lots were sold sight unseen to unsuspecting yankees in the ’60s or ’70s.
Jeff from SDCIA has gone incommunicado. Kind of hard to type from the fetal position.
Now that is some top quality schadenfreude.
Palm Beach County has a 43 months of supply. Prices still too high, another 30% drop may do the trick.
Ah yes, lovely Cape Coral. Where streets suddenly come to an end at canals and you have to backtrack and drive another 10 minutes to continue along said street on the other side.
There are still A LOT of empty lots in the northern part of the city. That area is a lot like Texas in that it has very little vegatation and is completely flat. Apparently all the native trees in Cape Coral were cut down many years ago to make way for development and no to many were replanted. Ugly, ugly, ugly.
As if Cape Coral didn’t already have enough problems, there is also an infestation of Nile Monitors (which can grow up to 7 feet long).
http://www.sptimes.com/2003/09/26/Floridian/Enter_the_dragons.shtml
“An adult Nile monitor can measure 7 feet. The lizards can climb trees and walls, dig burrows and tunnels, swim long distances even underwater.
They eat, Klowden says, “anything that fits into their mouths” and can devour oysters and turtles, shell and all. Females can lay up to 80 eggs at one time.
The Nile monitor is native to Africa, but you can buy them in pet stores all over Florida, no permit required. There are hundreds of them living wild in Cape Coral, maybe more than 1,000.”
Unfortunately I know someone personally who has a house in Cape Coral. Every time I see him he tells me about his woes trying to unload it, and how he should have listened to me when I explained the problem last year. He’s a really nice guy who just got caught up in a mania, so I don’t feel any schaedenfreude at his plight.
Why buy!
http://www.stockrentals.com/PropertyDetails.aspx?ListingID=1236
http://homes.realtor.com/search/listingdetail.aspx?zp=34113&mnp=30&mxp=30&typ=2&sid=c471010e6b7449ee81dccd3a03bfe6d9&pg=2&lid=1053544698&lsn=13&srcnt=54#Detail
Why, indeed! Quite the contrast.
Geez, it that doesn’t sum things up nothing will but, we are still going to have people say ” I just don’t want to throw away money on renting”.
““Premier Properties, a Sarasota player and part of the much larger Naples company of the same name, opted to sponsor an open house featuring Diane Ahlquist, a psychic and author….Ahlquist capped off the evening with an announcement that she and her husband had put their home on the market.”
I guess her psychic abilities didn’t extend to knowing when to sell her house…
“Peggy Hummel, CEO of the Realtor Association of Greater Fort Myers and the Beach, said the association’s statistics show that ‘we’ve got about a 15-month supply of residential and 18 months of condominiums,’ so the inventory of unsold homes should be gone by late 2008. ‘The market should be back about 2009.’”
Impeccable logic.
So, 9 months ago, there were 9 months’ of supply…. Therfore, there are no houses on the market now…..
LOL because, as we all know, there are no more houses that can possibly be put on the market.
Please.. absolutely nobody else put your house up for sale during the next 15 months because you will throw off her logic!
Unbelievable. CEO? Haha
She forgot to mention the new moratorium on listings!
An absolute classic. As if no one else, between now and late 2008, will be listing a home. I sure hope Ben is keeping a list of idiotic statements, since this is up there with DL - probably even better.
“‘It’s a horrible market,’ said Keith Olson of Fort Myers Beach, an investor who lost $90,000 on one Cape Coral house he sold recently and expects to lose $70,000 when he closes on the sale of another one next month.”
Hey, Keith. Try your luck in Las Vegas or (insert casino of choice). You will likely lose less money, and even have a shot at walking out with more. Or, come to Albuquerque. We have some casinos. And you can talk to Monica about how to buy property here that she guarantees will go up. She has her seven reasons.
Abq a bit off topic, but these crime stats are interesting…
http://www.bestplaces.net/crime/?city1=3502000&city2=0615044
Wow, ABQ is WORSE than Compton?
Looks that way, palmetto. Tied with Compton for violent crime rate and much worse for property crime rate. Yeah, Monica missed that in her article that need 2 leave posted Friday.
It’s not uncommon for houses in nicer areas of Abq to have bars on the windows and the “ghetto screen door”. They came on a house I bought and lived in on the weekends. That house was in a pretty good area so the bars and doors were stylish, of course. I still kept a gun by the bed.
Implosion, thanks for the link. I compared crime stats of various cities for a long while.
In case anyone’s interested, Miami’s crime rate is also right on the nose with Albuquerque.
They give you “free” drinks too!!!
Not at the casinos in NM. Cannot have alcohol outside the bar area on the casino floor.
“The market should be back about 2009.”
yeah, at this sales pace as long as no inventory is added…as long as no inventory is added as long as no inventory is added.
The whole article by Monica is in the thread from Ben’s desk clearing from Friday.
And the first lesson to learn is why Albuquerque and why now?
The answer is that it’s finally Albuquerque’s time, and for seven very specific reasons: (1) Population growth, (2) a thriving local economy, (3) a low cost of doing business (with a favorable tax climate), (4) a low cost of living, (5) housing that is affordable, (6) a great quality of life, and (7) incredibly strong economic development at the state level and locally.
OT, but my favorite thing about this blog is that Ben pulls articles from all over the country, so everyone who reads here can grasp the scope of this mess.
Too bad the local MSM has such a myopic view….here in the Bay Area, we don’t have a subprime problem so we’re “immune”, in Albuquerque their low tax base and “everyone’s coming here” will save them, Manhattan has their Wall Street bonuses. And the local papers don’t print anything about what’s happening in so many other markets. Nothing that Ben highlights in the articles about Florida is unique to that state’s dismal RE market.
So no wonder sellers are stubborn. Unless you read Ben’s blog, it’s pretty easy to be clueless about the RE tsunami that gets bigger by the day, and coming to a market near you.
Excellent comment. In fairness, the insurance crisis is unique to Florida (maybe a few other coastal states as well, but not as sweeping as Florida).
Florida does have a combo of elements that make its downturn more of a perfect storm here than most anywhere else, as follows:
1) Run up WAY past that which can be supported by fundamentals.
2) Low wages than most states, larger percentage of fixed income retirees
3) Major shafting by insurance companies in collusion with politicians, far beyond any other state, IMHO.
4) Probably the most fraud of any state
5) Decreasing taxpaying population.
6) Constant threat of hurricanes, sinkholes.
7) Major political corruption at all levels of government
I don’t mention taxes. IMHO, they’re not really a problem, they only becaume a problem because of the bubble. The tax situation is a bogus, invented problem and jiggering with the taxes is being done by politicians to cover their corruption with respect to the insurance issue.
Anyway, I don’t know of any other state that has quite that combo of factors. Yes, it IS different here, LMAO!
“(maybe a few other coastal states as well…”
Insurance commissioner puts pressure on Allstate
Request for justification follows company’s proposed rate hike
By Eve Mitchell, BUSINESS WRITER
Article Last Updated: 05/24/2007 03:10:26 AM PDT
State Insurance Commissioner Steve Poizner on Wednesday ordered Allstate Insurance Co. to justify its fees for homeowners insurance after the company announced it is seeking a 12 percent rate hike.
“If I find that Allstate’s rates are excessive, refunds will occur,” Poizner said in a statement.
The move comes two weeks after Allstate announced that, as of July 1, it will no longer sell new homeowners policies in California. Current policyholders will not be affected.
Allstate said the change is necessary so it can pay future claims of existing policyholders in catastrophe-prone California. It has become too risky to write homeowners insurance here, the insurer said.
http://www.insidebayarea.com/sanmateocountytimes/ci_5975425
And when the tsunami hits, they will be surprised that nobody warned them! LOL. Ben and this blog are tops. I have been reading Ben’s blog since he started. Till then, I thought I was the only person in the SF Bay area that was nuts and looking at a pending tsunami. This blog let me know I wasn’t the only one.
Misstrial - we must have some similiar patterns.
Look beneath the remark by realtorwhore Peggy Hummel of Ft. Meyers concerning the excess inventory. “……should be back in 2009.” Her remarks is interesting for a couple of reasons. #1. She obviously thinks things are bad. #2. I’ve not seen a realtor mention 2009 as a possible bottom. #3. If she thinks 2009 will be the bottom because the massive unsold inventory will have been reduced, then she isn’t taking into account affordability, foreclosures coming in the next 2 years to say nothing of weather related destruction which will affect those with no, or little, insurance.
If she says 2009 and she’s a hyped up, spin the real facts realtorwhore, I’m changing my “bottom” theory of 2009/10 to 2012.
Neighborhood Swayed by ‘Liar’s Loans’
http://biz.yahoo.com/ap/070526/stretching_the_truth.html?.v=4
Best line of the article:
“Of course, most real estate agents and mortgage brokers are honest.”
Does anyone actually believe this?
I have worked with three real estate agents in my life. I would rate the first one as honest and diligent, but so busy she didn’t always pay close enough attention to my concerns. The second didn’t really listen but treated us more like a commodity. She wanted to put us into the most expensive house we could afford instead of listening to our notion that we might live below our means. The third was not only honest to a fault but represented our interests with tenacity, energy and enthusiasm. She was outstanding: kept the lines of communication open, followed up on every detail immediately, overcame every obstacle. She got a 1% commission out of the deal. She has since left the profession, more’s the pity.
I was an agent many years ago and I was totally honest with people. That is why I left the business. I could not compete with the people who would say and do anything to get a deal. We called them the “menopausal Minnies”. They would fight you for $50.
That’s classic! A psychic giving HOPE to these realtors all having a party trying to get past their woes at another realtors expense. The evening ends witha smack of reality, the psychic stating she’s selling FSBO. You can’t make this stuff up! HAHAHAHA!
ROFL! Somebody pinch me.
Here is a brief sarasota update.
They are tearing down the last of the quay a circa 1980’s mixed use building to make way for a HUGE BILLION dollar mixed use structures. And there are TWO other big projects going on downtown including the atrium which is another non-discript condo building. As I drive around at night the recently completed buildings are all dark. A recently completed project along highway 40 (three 12 story buildings) were up to recently mostly dark but now i notice they are more lit up but on closer inspection it looks obvious that the realator/owners of the buildings have simply turned on a bunch of lights to give it that lived in look. And one last project at highway 41 and stickney point which was to be a BIG multi use project in which they tossed out the residents of an aging mobile home park has gone NO WHERE!
“Peggy Hummel, CEO of the Realtor Association of Greater Fort Myers and the Beach, said the association’s statistics show that ‘we’ve got about a 15-month supply of residential and 18 months of condominiums,’ so the inventory of unsold homes should be gone by late 2008. ‘The market should be back about 2009.’”
PLEASE STOP THE MADNESS!
alot of hope in 2009.
I was talking with my father today who lives in Sun City Center and he notes that the housing market there is still bad. He said that there were about 25 houses for sale in his little neighborhood of Saint Andrews Estates which he passes every day during his morning walk. He said that a lot of these homes were unoccupied. Some owners had tried to rent and failed while others are just letting their properties sit on the market. He thought that prices had come down about 5% but that even when owners were lowering their prices significantly, the properties still were not selling. The bottom is a long way off in this area. I would assume that there is probably another 25 homes of “hidden inventory”. These are homes which would go on the market if it was not for the market weakness and all of overt inventory.
St. Andrews Estates is nice. I would gladly rent in Sun City Center (except for King’s Point) but alas, I’m too young yet. Might even break my rule about buying in a HOA to live there one day. Sun City Center has those nice little concrete block shacks that I like, in the older parts. What are the fees in St. Andrews, do you know?
I know that the fees keep going up. I think that they are now about $100 per month but I am not sure about this. I could ask my father. There is a transfer fee of I believe 1% when you go and sell your home. The homes are not well made in general even the older homes. If you like to play golf, then I think that it would be okay to live there but otherwise it is not close to anything. There is a lot of traffic on 301 and they are building oodles of homes along that stretch from Bradenton to Brandon.
It is difficult for the renter because the owners want to sell the house and you are always subject to being kicked out at the end of your lease term if they can find a buyer. They usually will not do long leases although maybe they are now desperate enough for this. I think that homes here went for around $300,000 in 2005. My father and his wife purchased in 1998 for about $105,000. I have no idea what they would sell for now.
Thanks for your comments, hubrispie. $100.00 per month is not terrible, heck, I was paying $125.00 month in an HOA (not including special assessments) back in 2000 when I left South Florida. From what I understand, you get a lot for your fees in Sun City Center.
You are right about renting from someone who is trying to sell, not a good idea if you want to stay for any length of time. Lately, though, I’ve seen Sun City Center rentals for long term leases. There’s some capitulation going on there.
I happen to like the area, that’s why I ask about it. I stay away from 301, though. If I have to go to Tampa, I cruise up 41. If I go south to Sarasota or Bradenton, I take 75. 301 is a death trap from Sun City Center to Ellenton, due to the heavy illegal immigrant population along that stretch of 301. Tell your father to avoid it like the plague and don’t let his wife drive it, either, unless they’re going to the Copper Penny for a quick bite to eat.
Stopped in at 2 pawn shops to do a little feasability work and the places looked like a Snap On Pneumatic tool display. Tools, belts, generators, compressors stacked up in piles. Nail guns by the dozens. The guy said he is not taking anymore tools as he has a supply that will last years in front and back. Contractors and skilled labor are toast. (Orlando)
Sounds like the “years worth of pawn shop inventory of tools for sale” may even surpass the “years worth of used homes for sale inventory.”
A professional lowballer in Florida:
“It’s a great time to be Shaun Carcary. The 42-year-old South Africa native has built a business on paying 50 cents on the dollar for stressed houses. He gets plenty of takers.”
…
“Mary Dean complains they’re two months behind on their $1,750 monthly payment. By early June the bank has threatened to get tough. Sean Dean was laid off from his metal working job. They have a For Sale sign out front, but no one’s biting in the tepid market.”
“The HomeVestors team gives the house a once-over. Rickard conferences with the Deans at the dining table. He vouches for HomeVestors reputation, tells the couple he’ll get them the best price he can, reminds them he’s a no-hassle cash buyer.”
“After the 10-minute pitch, the team is back in the Expedition rocking down the highway to Tampa. Carcary’s driving.”
“What’s the deal?” he asks.
“If it was up to her, she’d sign the contract right now,” Rickard says.
“Uh huh,” Carcary says.
“I’m telling you now, we can get this deal,” Rickard says. “When I told them about the 80 other houses for sale in the neighborhood, they about spazzed.”
…
“Of the hundreds of leads a month, Carcary will make about 80 offers and get 10 to 15 takers. He usually pays about 50 cents on the dollar - 20 cents or 30 cents for sinkhole homes. He’s mostly in the market for homes less than $150, 000. They’re easier to resell or rent. Dallas provides a line of credit.”
“When it comes to negotiating with sellers, Carcary’s method is to “get into their psyche” and “find their pain factor.” If a house can’t generate at least $15,000 in profit after rehab, he’s not interested.”
“People in a bad situation need to hear the hard, cold truth…”
http://www.sptimes.com/2007/05/27/Business/They_ll_buy_your_home.shtml
What does one do with a sinkhole property?
Well Sounds like a good idea Absolute auction starting at $240K maybe at 20% the $302K last sale….off he might get one taker….heck its worth a shot……what do you think?
===================================================
A day later the Deans respond to HomeVestors’ offer. Mary Dean was tempted to take the $165,000. Her husband won’t part with the house for less than $240,000.
Carcary, preparing to fly to Dallas to address a HomeVestors conference, isn’t rolling over.
“He’s one of those guys, I’m telling you. Hard headed,” Carcary says. “We’ll just see when they get three payments behind. Maybe they’ll come to their senses then.”
Man, talk about some uncomfortable pressure at various body locations…
A second set of family members just bought a house in Oviedo. My Aunt and Uncle just had their offer accepted on a 3/2 with a pool in a nice area off Alafaya Trail. The list price was 270,000. They didn’t think the guy would take their offer (I don’t know what they offered yet) but viola–he did! I’m thinking somewhere in the 250,000 range. They’re buying with a VA loan. My uncle gets around 800/month for Army ret. and is a professor at Valencia Community College. She has a travel business out of the home that does ok. They always have the nicest of everything. I mentioned to my mom they’ll be 85 when the loan is paid off. How can they EVER retire with a $2000+ payment for mort/taxes/ins? They are putting nothing down or next to nothing with the VA loan.
I feel crazy sometimes that we’re not buying a house here in GA. We had the opportunity to buy a 1600 sq. ft. 3/2 on 3 acres for 179,000 but decided not to do it. It was double what they paid 5 years ago and we are in the middle of BFE. Who the heck will buy it from us? We don’t feel like we’ll be here more than 5 years. We asked our realtor about offering maybe 150,000 but she said we would offend people if we start doing that. That house and all the others we looked at are still on the market 60 days later. We’re renting a nice townhouse on the lake for 1100/month. That’s what we can afford with one income (I stay home with the kids) and no debt. These family members have literally told me, in exact words, that they cannot afford the mort, taxes, and ins. for the home. They can only afford the mort. (barely) and hope their bonuses, measly savings, and inc. tax returns can cover the rest.
Am I crazy? I feel like the lone fish swimming upstream. We drive our cars till the doors fall off, pay cash for everything, live on one income and take care of our own children, and wear clothes from discount stores. One of my few friends who is the same way told me they live by this Bible verse: Matthew 7:13-14 “Enter through the narrow gate. For wide is the gate and broad is the road that leads to destruction, and many enter throught it. But small is the gate and narrow the road that leads to life, and only a few find it.” If the masses are doing it, it’s probably not the best. Someone please tell me I’m not crazy!
I know what you mean. Sometimes I feel like the only adult in a world of impressionable children. So many people I know are debt slaves for life, trading their freedom for over-priced disposable toys, only one small emergency from disaster. What will they do in later life, when nobody will pay them a salary to maintain their debt or even rent a decent place?
It’s really amazing. I just keep asking my mom: ‘Where are they getting the money for this?’
We moved to Ga. for my husband’s new job. He’s making 56,000 plus bonuses that will possibly put him up to 62,000. We wouldn’t look at anything over 180,000 and didn’t really want to pay more than 150000. My cousin, the daughter of the people mentioned above, has a 10 month old and also stays home. Her husband makes around 52,000 maybe a little more now and got a 3000 bonus last Christmas. They just bought a house for 215,000. It’s in awful condition and they’ve already had to replace the air conditioner, including electrical work, and replaced the windows. The house is really in bad shape. They’re the ones who told me they literally can’t afford the house. Oh yeah, he’s had the job for less than a year.
Why would you do that? Is a house that important that you’re white knuckling it month to month and then praying all the stars will align so you can pay your taxes and insurance? Am I now an all out bitter renter!?
“We asked our realtor about offering maybe 150,000 but she said we would offend people if we start doing that.”
You have the wrong agent. Doesn’t mean she’s a bad person, but she absolutely, positively, for sure is the wrong one to be representing you at the moment. She is concerned with her reputation; you are concerned about the price. There are many, many starving agents out there. Of those, I’m sure many are quite competent at putting together the paperwork for your offer and presenting it as you wish. IMO, ditch your agent in the morning and hire one who doesn’t mind lowballing. Lowballing is “the new black,” to pinch TxChick’s phrasing.
We asked our realtor about offering maybe 150,000 but she said we would offend people if we start doing that.
That’s exactly what you want to do!
I knew we had a bad realtor when she said that. Who’s she working for again?
The people who are paying her commission. The sellers.
If you’re not offending the sellers you’re offering too much.
Yeah, and what about my being offended by that stupid price!!!
Seriously though, the house was kind of disheveled–some furniture missing, no refrigerator, kids stuff in one room, and only womens clothes in the master closet. I’m pretty sure the people were divorcing. I keep wondering if the poor woman had to sell the fridge to keep the house! They were definately living there but things just didn’t seem ‘right’.
I wonder if she’ll lose the house? I wonder if she would be offended to know we wanted to buy it but didn’t make an offer b/c of a realtor?