Tallahassee Real Estate Blog

We have had quite a bit of response to yesterday’s blog on absorption rates in the Tallahassee real estate market. Apparently, many people who read this blog want to see how Leon County (specifically) is doing versus the entire Tallahassee Board of Realtors Multiple Listing Service (MLS).

I did a download from the Tallahassee MLS for Leon County homes that sold from April 16, 2007 through yesterday, April 15, 2008. I also pulled all of the active listings in Leon County. I also took the time to remove all of the duplicate sales and listings (the MLS has many homes that are entered more than once which skews data) to come up with the following information:

As we can see from the table above, there is a whole year’s supply of homes across all price ranges in the Tallahassee real estate market (Leon County only). Our twelve-month absorption rate has dropped to 271 homes per month in Leon County. While this is better than the surrounding counties, it is still not that exciting. I suspect that all the attention that real estate is receiving from the media is slowing home sales even more so than the post-boom recovery that was needed. If this is true, we can expect a nice recovery-upswing when the media gets bored with the real estate market.

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Keep checking out the Tallahassee Real Estate Blog every day for updates that include charts, graphs, and analysis of the Tallahassee real estate market.

If you like this Article then please subscribe to my blog through a full RSS feed. You will be able to stay informed about the happenings in the Tallahassee Real Estate Market. You can also subscribe to this blog and have it delivered by Email.

Joe Manausa is a real estate investor and the Broker and Co-Owner of Century 21 First Realty. He can be reached via e-mail through the Tallahassee Real Estate Website or catch his latest writings on the Tallahassee Florida Real Estate Blog , or by calling (850) 386-2001.

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With all the major real estate reporting centers claiming that the Tallahassee real estate market is seeing appreciation, I felt it might be a good time to explain the difference between higher spending and appreciation.

As we look at this first graph, we can see that the average home price in Tallahassee appears to be higher (through February) than it has been in years past.

While this is good and accurate information, I suspect that many people are using this information to declare that home prices are rising in the Tallahassee real estate market. I think that lower mortgage interest rates in Tallahassee have allowed buyers to buy more home for their money, rather than pay more money for a home. In order to demonstrate this point, I downloaded all the Leon County residential sales from the Tallahassee Board of Realtors Multiple Listing Service (Tallahassee MLS) for the past twelve months. I then sorted them by price range. The following chart shows residential sales in Leon County compared to homes currently for sale in Leon County.

Note how each price range has four colored bars above it, and a yellow field behind them. I have “blown up” a section of the above graph to show what this information is telling us. In the picture below:

• Point #1. shows red arrows trending downwards. This is the past 12 months, 9 months, 6 months & 3 months sales for each price range. Note how the price per square foot for each price range is falling? I believe this is demonstrating depreciation in each price range.
• Point #2. shows us the yellow field is the current asking price at each price range (presented as price per square foot). Note that the price range of $125,000 - $150,000 has the yellow field closer to the tops of the vertical bars (the asking prices average 9% higher than the previous 3 months sales) as compared to the price range of $250,000 - $300,000 where the yellow field is much higher than the tops of the vertical bars (the asking prices average 20% higher than the previous three months sales).
  

Conclusion on Residential Home Prices In Tallahassee

There are many good buying opportunities in the Tallahassee real estate market. There are also a lot of homes that are over-priced and can be confusing to buyers. The key is to use the modern tools that are available to find the best buys in the Tallahassee real estate market. The graphs above were created using “averages,” but averages are not what a buyer buys. Each home is priced specifically and it takes all the homes for sale in Tallahassee to create the averages. If you want to buy a home in Tallahassee, just look at the homes of the Sellers who are priced to sell, and your selection process will be much simpler and more enjoyable.

As a reminder for those who subscribe to the Tallahassee Real Estate Blog by email, some embedded pictures and videos might not be appearing in your email and you might need to click the title header to go to your browser where all will be visible.

Keep checking out the Tallahassee Real Estate Blog every day for updates that include charts, graphs, and analysis of the Tallahassee real estate market.

If you like this Article then please subscribe to my blog through a full RSS feed. You will be able to stay informed about the happenings in the Tallahassee Real Estate Market. You can also subscribe to this blog and have it delivered by Email.

Joe Manausa is a real estate investor and the Broker and Co-Owner of Century 21 First Realty. He can be reached via e-mail through the Tallahassee Real Estate Website or catch his latest writings on the Tallahassee Florida Real Estate Blog , or by calling (850) 386-2001.

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Every once in a while, we have a Tallahassee real estate sale that demonstrates the amazing power of the combination of the global reach of Century 21 with the local effort of great people. Here is a classic example of this.

I received a late-night call from a U.S. Veteran working in Baghdad. He had received some bad advice on a real estate investment and needed some serious help. Somebody talked he and a friend into buying four new-construction homes to flip and make big money…..

So here he was, living in Iraq and losing money in the Tallahassee real estate market! This was during the boom of the market, so the advice he received was truly bad.

He turned to the biggest name in real estate, Century 21, for help. He called me from Iraq and I felt an extra special need to help him, as I am also a Veteran who has served overseas in the past. After our call, he sent me this email message:

Tallahassee Real Estate Problem

From: d b [mailto:XXXXXXXXXX]
Sent: Tuesday, September 04, 2007 2:55 PM
To: Manausa, Joe
Subject: Dave in Baghdad/Tallahassee houses

Hello Joe,

Great talking to you. Thank you for any and all your help in getting Earl and I out of our house messes. Earl will be coming to Tallahassee tomorrow and will bring along his paper work for the houses. We both have the exact same paperwork. Earl can re-tell you the whole story.

The house links are below….my house numbers are XXXX and YYYY ZZZZ Road (AAAA Subdivision). I owe $XXXXXXX on each house. (original loan/borrowed amount). First made my loan on May 2006. Both houses went past one year to be built.

Earl will show you what paper work we do have….which is basically the XXXX loan paperwork, and the lease we each have with one house rented. We are getting $1100 per month rent. Since the houses went past there construction life, the bank wants 11.75% interest. I’ve had my loan since May 2006, and it took over 6 months before the build would start working XXXX. Earl’s and mine second house are still not finished.

Its just a big mess and nightmare.

Thanks again….from one Veteran to Another….. Best Regards, Dave B (XXX) XXX-XXXX cell, when in US.

As you can see from the date on the message, this was in September of last year. So, he’s several thousand miles away and a builder is not finishing his home and he’s now facing a bank (not local) charging him 11.75% interest on the loan!

Tallahassee Real Estate Solution

Summer Munyon, the 2007 Tallahassee Board of Realtors Rookie of the Year.

While Dave was unhappy about losing money in this real estate market, he recognized that his best option was to sell his investment property quickly. The most important information that Summer gave Dave was the months supply of inventory in his neighborhood of Wilson Green. Understanding that homes typically sell in the order of best value, Dave chose to list his home at the lowest price home in the neighborhood, and we continuously monitored the activity in the neighborhood. Within 4 weeks, Dave dropped the price on his home by $5000, pricing it just under $150,000. The home sold within 4 months on the market, while homes that we on the market before we even received his call for help are still on the market today. Weekly, sometimes daily, contact with Dave ensured that he was well-informed about the sales process and was satisfied with the marketing activities performed.

To read more about Dave’s glowing review of our work, visit our Tallahassee Real Estate Agent section of our website.

As a reminder for those who subscribe to the Tallahassee Real Estate Blog by email, some embedded pictures and videos might not be appearing in your email and you might need to click the title header to go to your browser where all will be visible.

Keep checking out the Tallahassee Real Estate Blog every day for updates that include charts, graphs, and analysis of the Tallahassee real estate market.

If you like this Article then please subscribe to my blog through a full RSS feed. You will be able to stay informed about the happenings in the Tallahassee Real Estate Market. You can also subscribe to this blog and have it delivered by Email.

Joe Manausa is a real estate investor and the Broker and Co-Owner of Century 21 First Realty. He can be reached via e-mail through the Tallahassee Real Estate Website or catch his latest writings on the Tallahassee Florida Real Estate Blog , or by calling (850) 386-2001.

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I have been posting the Tallahassee real estate market charts on the Tallahassee real estate web site for the past week. In doing so, I and many readers were observing that the following chart is a bit baffling.

As we can see above, it appears that prices are rising…. yet we know inventory has risen and unit sales have fallen. What we expect to see is some downward movement on prices. I asked readers of this blog (and others) for opinions on why this was happening and really none of us had a good answer…..

UNTIL

Gooch recommended we look at price per square foot. He reasoned that maybe consumers were able to buy more expensive homes due to falling interest rates, but that maybe they were getting more house. So, this next chart is what  Gooch requested. It shows residential home sales in Leon County by price per square foot, across different price ranges.

Gooch, prices are indeed falling. While this is not the best news in the world, it certainly makes sense with unit sales being down.

So, how are the current asking prices for Tallahassee homes reflecting this?

As we can see from this, with few exceptions, there are many price ranges that have a majority of their homes over-priced. It appears that homes priced between $150K and $200K are priced very reasonably, while homes in higher price ranges seem to be off the mark quite a bit.

Just remember, in every market, their are unrealistic Sellers who ask more for their home than the market is willing to bear. They make the “average” asking price much higher than it would be if only serious sellers were in the market. Today, you can definitely find the serious sellers out there. They are the ones that have their homes priced well below their competition.

As a reminder for those who subscribe to the Tallahassee Real Estate Blog by email, some embedded pictures and videos might not be appearing in your email and you might need to click the title header to go to your browser where all will be visible.

Keep checking out the Tallahassee Real Estate Blog every day for updates that include charts, graphs, and analysis of the Tallahassee real estate market.

If you like this Article then please subscribe to my blog through a full RSS feed. You will be able to stay informed about the happenings in the Tallahassee Real Estate Market. You can also subscribe to this blog and have it delivered by Email.

Joe Manausa is a real estate investor and the Broker and Co-Owner of Century 21 First Realty. He can be reached via e-mail through the Tallahassee Real Estate Website or catch his latest writings on the Tallahassee Florida Real Estate Blog , or by calling (850) 386-2001.

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I received so much feedback on The Creative Cure For Selling Your Home article that I decided to follow it up with a “how and why” to consider a Purchase Money Mortgage when selling your home.

So what is a Purchase Money Mortgage?

Sometimes a buyer wants to buy a home and has good enough credit to purchase the home, but is short some of the cash that the lending institution will require to close the loan. In cases like this, the Seller can hold a note for some of the cash and secure it as a secondary lien on the home. When this is done, we refer to the Seller’s second a Purchase Money Mortgage. Let’s consider an example on how this could work.

Mr. and Mrs. Smith would like to buy a Tallahassee home. They find that Mr. and Mrs. Jones have the perfect home for sale in Tallahassee and it is priced at $250,000. The Smith’s go to the bank and discover that the bank will lend them $200,000 to purchase the home, all the Smiths need to do is invest $50,000 ($250,000 price - $200,000 loan = $50,000 down payment).

The Smiths look at all of their sources of money and discover that they can only raise $35,000, leaving them $15,000 short. So, working with an excellent and creative Realtor in Tallahassee, they make the following offer:

At closing, the Smiths get $235,000 as well as a note from the Joneses for $15,000.
This creative solution is simple and creates a large market for the Smith Home. Rather than have to lower their price to attract more buyers, the Smiths have attracted more buyers by making the house more affordable (not only to people with large cash reserves).

In today’s market, Tallahassee homeowners need to consider all the creative solutions possible to sell a Tallahassee home.

As a reminder for those who subscribe to the Tallahassee Real Estate Blog by email, some embedded pictures and videos might not be appearing in your email and you might need to click the title header to go to your browser where all will be visible.

Keep checking out the Tallahassee Real Estate Blog every day for updates that include charts, graphs, and analysis of the Tallahassee real estate market.

If you like this Article then please subscribe to my blog through a full RSS feed. You will be able to stay informed about the happenings in the Tallahassee Real Estate Market. You can also subscribe to this blog and have it delivered by Email.

Joe Manausa is a real estate investor and the Broker and Co-Owner of Century 21 First Realty. He can be reached via e-mail through the Tallahassee Real Estate Website or catch his latest writings on the Tallahassee Florida Real Estate Blog , or by calling (850) 386-2001.

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Well, it is finally started. After receiving so many requests for a permanent location to find real analysis of the Tallahassee real estate market, Century 21 First Realty has created the place! If you want to know more about the current trends in Tallahassee real estate, just following the link!

This page will be updated on a regular basis, with weekly summaries and monthly reports that will include charts, graphs, and analysis. As this will be a work in progress, often times you will be able to check out the Tallahassee Real Estate Reports before the summaries are even written.

You can also navigate your way to this site for great information on Tallahassee housing. Just go to our Tallahassee Real Estate Web Site (www.manausa.com) and click on the “Tallahassee Real Estate Market Update” link that is circled in the picture below.

As usual, we look forward to your comments and feedback to better guide our efforts at bringing Tallahassee real estate market information to you.

As a reminder for those who subscribe to the Tallahassee Real Estate Blog by email, some embedded pictures and videos might not be appearing in your email and you might need to click the title header to go to your browser where all will be visible.

Keep checking out the Tallahassee Real Estate Blog every day for updates that include charts, graphs, and analysis of the Tallahassee real estate market.

If you like this Article then please subscribe to my blog through a full RSS feed. You will be able to stay informed about the happenings in the Tallahassee Real Estate Market. You can also subscribe to this blog and have it delivered by Email.

Joe Manausa is a real estate investor and the Broker and Co-Owner of Century 21 First Realty. He can be reached via e-mail through the Tallahassee Real Estate Website or catch his latest writings on the Tallahassee Florida Real Estate Blog , or by calling (850) 386-2001.

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Today’s Tallahassee Real Estate Blog

This has to be a short one, as we have a lot going on in the office today. It is nice to see that plenty of people are still looking to buy a home in Tallahassee!

And speaking of buying a home in the Tallahassee real estate market, it looks like people are doing just that. This new chart was created from the most current data from the Tallahassee Board of Realtors Multiple Listing Service.

Of particular interest is the blue line and the green line. The blue line is the “pend trend” meaning the trend of new “under contract” homes. This began rising in September of last year and continues to do so. The green line represents the trend of the “consumed pendings” and historically hovers in the 70-80% range. This means that roughly 75% of contracts that are put under contract in the MLS actually make it to closing. When we see the number rise above that, we are either getting more efficient or the market is shrinking. Also, when we go above 100%, that means we are closing on more homes than we are putting under contract, meaning the market is definitely constricting. Above, the green line is a great sign, finally dropping below the 100% level. Once we see it settle in low 80’s or high 70’s, I will feel much better.

As a reminder for those who subscribe to the Tallahassee Real Estate Blog by email, some embedded pictures and videos might not be appearing in your email and you might need to click the title header to go to your browser where all will be visible.

Keep checking out the Tallahassee Real Estate Blog every day for updates that include charts, graphs, and analysis of the Tallahassee real estate market.

If you like this Article then please subscribe to my blog through a full RSS feed. You will be able to stay informed about the happenings in the Tallahassee Real Estate Market. You can also subscribe to this blog and have it delivered by Email.

Joe Manausa is a real estate investor and the Broker and Co-Owner of Century 21 First Realty. He can be reached via e-mail through the Tallahassee Real Estate Website or catch his latest writings on the Tallahassee Florida Real Estate Blog , or by calling (850) 386-2001.

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We are helping somebody sell a home in Tallahassee who is considering an offer from a Buyer that includes a lease-purchase provision. A lease-purchase in Tallahassee is an agreement where the Buyer and Seller agree to a sale on the home and then the Buyer rents the home from the Seller, prior to closing. The closing could happen as quickly as 1 day, or could be extended for a long period of time (even years in some cases).

So, why would a Buyer offer to do a Lease-Purchase? Why would a Seller consider accepting a Lease-Purchase?

A Lease-Purchase can be a very beneficial “win-win” opportunity for the right Seller and the right Buyer. Some of the reasons that they might conspire to do a lease-purchase contract include:

Typically, home buyers see the benefit of a lease-purchase right away, as they are in a position to need a creative solution to buy a home in Tallahassee. Often times though, I find that Tallahassee home owners are not so quick to see the benefits of a lease-purchase to help them out of their situation. I hope that some of this blog can help Tallahassee homeowners understand that they too have creative options.

As a Seller, most people would prefer to get cash for their home and then just go along their merry way. Unfortunately, in today’s real estate market, less than a third of homes listed for sale in Tallahassee this year will sell! That means 2/3rds of our homeowners will fail to sell their homes. So, in case that you are one of the not-so-fortunate ones, what are your options?

• Lower Your Price
• Take Your Home Off the Market
• Lease Your Home
• Give the home to the bank
• Sell Your Home With Creative Financing

Obviously, cash in hand is the favorite option. But when that fails, the other options must be considered. The lease-option will allow you to move from your home and reduce the cost of continued ownership. If you absolutely need to move, the benefits listed above will apply to you. You can lock-into a sales price, get higher than market rent, cash a non-refundable deposit, and eliminate maintenance costs. Additionally, when you let the market know that you will sell your home through a lease-purchase, you increase the size of the market for your home, thus making it more valuable (you will attract all the buyers you would have attracted before, plus buyers who need creative financing as well). And don’t forget, you can use the lease-purchase method of buying your next home as you wait for your tenant/buyer to close on the sale of your Tallahassee home!

But what about the additional risk?

There is definitely additional risk selling a home through a lease-purchase. A party could agree to buy your home, move in, and then never close on the property. They could even destroy the property while never paying you rent, forcing you to evict them from the property. While this scenario sounds horrific (and it most likely would be), there are many things that you can do to mitigate the risk of this occurring.

• Make the Buyer submit a full loan application (Download Free FNMA Uniform Residential Loan Application)
• Seller review the loan application and make own determination of credit risk
• Collect a non-refundable deposit large enough to motive the Buyer to close
• Make the monthly rent payment higher than market rate, with the excess to be credited to Buyer at closing
• Make sure separate purchase agreement and lease agreement (lease agreement drawn by attorney in accordance with Landlord-Tenant Act)

Ultimately, we are going to see a strong return of the lease-purchase agreement as creditors tighten borrowing standards and inventories remain high. Don’t be afraid to consider a creative solution if it partially solves your Tallahassee real estate problem!
FNMA Uniform Residential Loan Application Form 1003

As a reminder for those who subscribe to the Tallahassee Real Estate Blog by email, some embedded pictures and videos might not be appearing in your email and you might need to click the title header to go to your browser where all will be visible.

Keep checking out the Tallahassee Real Estate Blog every day for updates that include charts, graphs, and analysis of the Tallahassee real estate market.

If you like this Article then please subscribe to my blog through a full RSS feed. You will be able to stay informed about the happenings in the Tallahassee Real Estate Market. You can also subscribe to this blog and have it delivered by Email.

Joe Manausa is a real estate investor and the Broker and Co-Owner of Century 21 First Realty. He can be reached via e-mail through the Tallahassee Real Estate Website or catch his latest writings on the Tallahassee Florida Real Estate Blog , or by calling (850) 386-2001.

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More news from the Tallahassee Real Estate Market. I will be doing a good bit of research and analysis this weekend, so today with be just a quick graph from the new data.

So, let’s take a look at new construction in the Tallahassee real estate market. New permits and new sales data is something that I have been tracking for a very long time. We can get a feel for the near-future inventory movement by what is happening in new construction today. The following chart shows the relationships between Tallahassee new permits and new sales in single family homes in Leon County, Florida.

The red line represents new permits while the green line represents new sales. We can see that new construction starts have been dropping since January of 2006, and correspondingly, so have the sales just thereafter. This went on until March of last year, when permitting turned from the lowest level seen since I started tracking this in 1997. It appears that we are just starting to see the sales follow.

As a reminder for those who subscribe to the Tallahassee Real Estate Blog by email, some embedded pictures and videos might not be appearing in your email and you might need to click the title header to go to your browser where all will be visible.

Keep checking out the Tallahassee Real Estate Blog every day for updates that include charts, graphs, and analysis of the Tallahassee real estate market.

If you like this Article then please subscribe to my blog through a full RSS feed. You will be able to stay informed about the happenings in the Tallahassee Real Estate Market. You can also subscribe to this blog and have it delivered by Email.

Joe Manausa is a real estate investor and the Broker and Co-Owner of Century 21 First Realty. He can be reached via e-mail through the Tallahassee Real Estate Website or catch his latest writings on the Tallahassee Florida Real Estate Blog , or by calling (850) 386-2001.

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In yesterday’s blog, I analyzed the Southeast Area of the Tallahassee Real Estate Market for the purpose of demonstrating how to use the Free Monthly Tallahassee Real Estate Market Report that anyone can download from the Century 21 First Realty web site.

Today, we’ll conduct the same analysis on the Southwest Leon County real estate market. The picture below represents the Southwest Section of Leon County. The price ranges are featured on the left, and then 9 columns of data fall to the right of each price range. Those 9 columns are actually three sets of three columns. The first set of three are homes for sale in Southwest Tallahassee (All, New Construction, Resales), the second set of three columns are homes that sold in Southwest Tallahassee in the past twelve months, and the final column displays the amount of homes for sale in Southwest Tallahassee (measured in ‘months’ of supply).

Based upon what the above numbers show us, the Southwest quadrant of the Tallahassee real estate market has the least amount of activity of all the market area segments. With only 418 sales in the past twelve months, there is most likely not enough data to draw as confident of conclusions as we can in the more active areas.

Using this information I would advise somebody who wants to sell a home in Southwest Tallahassee, with a value between $200,000 and $250,000, that they have a whole lot of competition. With 8 comparable resale homes on the market and 3 newly built and available for a total of 11 homes, this price range is going to be very competitive for home owners. The Southwest Tallahassee real estate market sells roughly 1 home per quarter, so a serious seller would need to be the single-best buy in order to get a serious look from buyers in todays market.

We can see a “picture” of this data below, and it does shows that due to such a low sales volume in this area, the chart is all over the place. The months of supply go from as low as 0 and as high as 33 (almost three years worth!).

As a reminder for those who subscribe to the Tallahassee Real Estate Blog by email, some embedded pictures and videos might not be appearing in your email and you might need to click the title header to go to your browser where all will be visible.

Keep checking out the Tallahassee Real Estate Blog every day for updates that include charts, graphs, and analysis of the Tallahassee real estate market.

If you like this Article then please subscribe to my blog through a full RSS feed. You will be able to stay informed about the happenings in the Tallahassee Real Estate Market. You can also subscribe to this blog and have it delivered by Email.

Joe Manausa is a real estate investor and the Broker and Co-Owner of Century 21 First Realty. He can be reached via e-mail through the Tallahassee Real Estate Website or catch his latest writings on the Tallahassee Florida Real Estate Blog , or by calling (850) 386-2001.

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