Sunday, August 04, 2019
Residential inventory in Cocoa Beach and Cape Canaveral has been slowly retracting for several months and currently stands at 203 existing condo units for sale in the two cities, approaching the all-time lows of 2015. There were 63 units sold in the month of July according to the Cocoa Beach MLS. Over half of those sold within six weeks of listing, For the first time in many moons, more than half of the condo buyers used a mortgage for their purchase. With rates for a 30 year mortgage well below 4% even those with the cash to purchase see little reason not to take advantage.
The bulk of the activity was in the lower price ranges with 70% of the closed units selling at prices below $300,000. The highest priced unit to sell in the month was a furnished 3008 square foot four bedroom, 3.5 bath beauty covering the entire 5th floor at Riomar on the ocean in south Cocoa Beach. At the other end of the scale there were four units in oceanfront buildings that closed for less than $250,000. The standout was a remodeled and fully furnished 6th floor direct ocean Windrush Cocoa Beach 1/1 that sold for $245,000.
There were ten single family homes closed in the month, two of them over a million dollars, one on the ocean and the other on the open river at the Cocoa Beach Country Club. Inventory of single family homes has plunged to just 45 listings in both cities, only two of those asking less than $300,000. The median asking price of the 45 single family homes for sale in Cocoa Beach and Cape Canaveral has risen to a shocking $599,000 with the highest current listing at $4.5 million for an oceanfront monster in south Cocoa Beach. Have no fear if your budget is south of that range. An updated, non-waterfront 4/2 Cocoa Beach home with a pool closed for $343,000 in July. Nice houses at a reasonable price are out there, there just aren't a lot of them.
Good hunting to those of you looking to purchase here. Feel free to contact me if you need help finding your spot at the beach or if you have questions about our little slice of tropical Florida.
“You said I’m full of diseases / Your eyes were full of regret / And then you took a picture of your salad and put it on the Internet.” Matty Healy
Tuesday, July 30, 2019
Sellers, it would be prudent to check your listing for accuracy and omissions even if your agent is an old seasoned pro. Their assistant may be the one entering your listing and she may have made mistakes. Missing condo name is not the only error that I see but it is one of the more egregious. I'm assuming the several listings offering less than one percent commission to the buyer's agent are just decimal point errors but how am I to know?
"I believe we are on an irreversible trend toward more freedom and democracy, but that could change." __Dan Quayle
Thursday, July 18, 2019
It's relatively common for a buyer to write an offer on a property with the offer contingent upon the sale of their current home. The offer will typically have a provision that allows them an escape should their current home fail to close within a specified period. It introduces unwanted uncertainty to the transaction for the seller but, if all are acting in good faith and the seller's agent protects her client effectively and stays in contact with the buyer's agent about the other sale, the uncertainty can be reduced.
The best scenario for a contract with this contingency is with a buyer whose house is already under contract, past the inspection period and with mortgage commitment. That is rare. It's much more common for the buyer's house to be listed for sale but without an accepted contract. In this scenario it is prudent for the seller's agent to determine whether the buyer's house is correctly priced and can reasonably be expected to sell quickly. In most cases I would advise a seller not to accept an offer contingent upon the sale of another property unless the other property was already under contract and reasonably certain to close or that I could confirm was priced to sell quickly. In the absence of reassuring circumstances I always advise against accepting this contingency with a house that isn't already listed for sale.
Regardless of circumstances I advise sellers to keep their property listed for sale as "accepting backup offers". When a property is marked "Contingent" in the MLS it disappears from searches for properties for sale. Our MLS and many others have a category called "Backups" which keeps the listing in the actively for sale category even though it has an accepted contract. It might be advisable to immediately reduce the asking price if the accepted contract is below the asking price to increase the chances of getting a backup. My opinion on backup contracts is well known to readers of this blog. For the seller, having a backup contract in hand effectively removes the uncertainties related to the other property closing and puts the seller in a postion to deny any requests for concessions or changes to the contract. In the event the other property doesn't close by the contract date, the seller can cancel and proceed towards closing with the backup contract. A contract without this contingency is obviously more desirable but these contracts, in my experience, do have a good record of closing.
Takeaways for sellers who might find themselves considering this scenario:
- If the first property is not already under contract have your agent confirm that it is priced correctly and likely to contract quickly. Consider contract language about price reductions if not under contract within X days.
- Insist that your agent stays in contact with the buyer's agent about progress of the sale/listing. Lack of communication from the buyer's agent is usually a bad sign.
- Keep your house listed for sale as "Backups" and aggressively seek a backup contract.
- Have a plan for failure of the contract and, in the absence of a backup, be realistic about requests for extension of closing date from the buyer.
I hope everyone has appreciated the significant difference in temperature here on the beach during this incredibly hot July. We have consistently been 5 to 10 degrees cooler than just a few miles inland thanks to the reliable, cooling sea breeze which begins midday most days. Orlando? Forget about it. As I write this, it's 7 degrees hotter there.
"Insanity in individuals is something rare - but in groups, parties, nations and epochs, it is the rule." __Friedrich Nietzsche
Sunday, June 30, 2019
The price range of sold units is closer to our usual range after the multiple high dollar closings at the new Flores de la Costa last month. Median price for condo units closed in June was $280,000. Six units in the month sold for more than $300 a foot, all but one of them direct ocean, new or furnished with garages. The one outlier was a small, 1st floor Spanish Main weekly rental 2/2 that commanded a remarkable $380,000. Oceanfront units sold as cheaply as $220 per foot but the majority clustered in the $250 to $300 per foot range. Those at the high end of the range were usually remodeled and with garages, often sold furnished. Exactly half of the sold condos sold for cash, no mortgage. Almost a third sold in the first week on the market.
Fourteen single family homes closed in the month, all but one in Cocoa Beach. Prices ranged from $775,000 for a nicely remodeled two story, five bedroom Cocoa Beach pool home on a wide canal intersection with a dock and lift to $274,900 for a small 3/2 south of downtown Cocoa Beach a block from the ocean.
Man, it's been hot. It's hard to enjoy the cheap summer green fees at the Cocoa Beach Country Club when all you can think about is avoiding heat stroke. Then there's the lightning. As I mentioned last post, be aware of approaching thunderstorms. They move in quickly this time of year, usually in late afternoon and are almost always accompanied by a lot of lightning. Get off the beach before the storm arrives. If you leave any gear on the beach be prepared for the winds to have rearranged or removed it.
Pros of being a young, single male veterinarian: Lots of female attention
Cons of being a young, single male veterinarian: Most of that attention comes from women very, very high up on the Cat Lady Scale seeking a medical sugar daddy for their cat harem. __Bill W
Saturday, June 15, 2019
One of my relatives asked for a contract review on the sale of their home in another city. Imagine my surprise at seeing "$395 transaction fee to be paid by the seller" written into the contract by the buyer's agent. Aren't they being paid commission already? Yes, in this case the buyer's broker was being paid $14,000, but the agent felt compelled to try and squeeze an extra $395 on top of that. She should be ashamed. "But, wait" I can hear her saying. "We have to pay our transaction coordinator and provide her office space." I get it. However, $14,000 will easily pay expenses and leave a healthy chunk to be split between the broker and the agent. "But", she says, "my broker charges me a transaction fee of $395." OK. Maybe that's why they offered you a more attractive commission split when you joined their office. Do the right thing, pay the $395 out of the commission and stop trying to rob people. I was faced with this exact scenario when my previous brokerage was bought and the new brokers mandated a transaction fee. Many agents, myself included, refused to pass that fee on to our clients but, disturbingly, many others thought it perfectly acceptable to have their clients pay it. That particular broker cleverly called the junk fee a "Regulatory Compliance Fee" which they hoped would eliminate client protests. A transaction fee charged by the broker to the agent can be an entirely legitimate fee TO. THE. AGENT. There are very few circumstances that would justify passing that fee along to a client. Unless there are unusual circumstances justifying the fee, I would encourage anyone whose agent has tried to charge them a transaction fee to immediately find a new agent. Asking for a transaction fee is all the evidence necessary (in most transactions) to demonstrate that the agent is not working in their client's best interest. This stuff really bothers me.
For those that haven't read any of my blathering about brokers stealing from their clients, here's a good one from five years ago, Robberies Update
"Profit is sweet even if it comes from deception." __Sophocles
Wednesday, June 05, 2019
The statue of the spaceman surfer is by Henry Lund and is installed at the new downtown Cocoa Beach parking garage. It's a timely departure from the abundant, well-worn t-shirt images we're used to seeing with a shuttle blasting off in the background while surfers and pelicans glide across waves in the foreground.
Our inventory has contracted a bit with 252 existing condo and townhome units and 60 single family homes for sale this morning in Cocoa Beach and Cape Canaveral. The Cocoa Beach MLS is showing 24 homes closed in the month of May at prices between $192,500 for a 1000 foot fixer-upper to $825,000 for an 18 year old direct river 4/4 beauty in Sunset Cove.
There were 62 condo units closed in the month. Sales spanned a range from $90,000 for a tiny 1/1 in Cape Canaveral to $955,000 for a brand-new top floor(5th) SE corner direct ocean Flores de la Costa in north Cocoa Beach. That particular new building, the only new oceanfront construction in Cocoa Beach in quite some time, began closing pre-construction contracts this month after getting their CO. Side view 2/2 units in the building closed for as little as $350,000. The building has a two week minimum rental period so rental potential there is high especially as it's the only new vacation rental in the city. There are a few units still available if anyone would like info.
Love bugs are finished (hopefully) until the next hatching in August and the heat has settled in. Those of us on the coast have been enjoying the sea breeze which has kept us about ten degrees cooler than Orlando and the interior most afternoons. That's one of the reasons we live here, right?
If anyone needs a tough, experienced buyer's agent in the Cocoa Beach area, now that I'm back full time, I am able to take on a few new clients. Those of you who were looking at properties back during snowbird season without finding anything may want to consider resuming the search during the summer season when you'll have less competition.
When you're in Cocoa Beach this summer, enjoy yourselves and remember, sunscreen and hydration. The 4th Street Filling Station is a must visit for good food and a crazy beer selection. Outdoor dining under the old oak trees and very kid-friendly.
"Good decisions come from experience...and experience mostly comes from from bad decisions." _(From restroom stall at "Airport Diner")
Monday, May 13, 2019
Welcome to lovebug month. May is usually the first big hatch of the year here and it hasn't disappointed. We had almost daily minor hatches for weeks until our first big one last week. The good news for Cocoa Beachlings is that our 35 MPH speed limit is just below the threshold for crushing the little critters, sparing our cars the gooey mess that faster speeds produce. While we were dealing with lovebugs, Denver was dealing with late season snow on the tulips.
Residential real estate activity in Cocoa Beach and Cape Canaveral has been brisk with 70 condo and townhome units and 13 single-family homes closed in the month of April. Condo sales were fairly evenly spread across all price ranges with a median selling price of $250,000. Sixteen units sold for more than $400,000. Sold direct oceanfront units closed in a range of $250 to $354 per square foot with only completely remodeled or new units with garages commanding over $300 per foot. For perspective, there are currently 34 optimistic sellers asking over $300 per foot for their units, the majority of which are certain not to receive anything close to their crazy asking prices. The intense competition for listings continues to nudge asking prices further into the silly realm. A listing agent willing to list a property for considerably more than the comps can justify is not doing her client a favor although by accepting the overpriced listing she is keeping it out of the competition's hands. Keeping the listings and sales numbers high on Zillow is imperative for the high volume agents and teams. The same statistic-driven marketing encourages listing agents to cancel and relist properties in order to keep their average days on market artificially low. Many MLS statistics have become so massaged that they can no longer be trusted. Selling price as a percentage of asking price, days on market, concessions and who actually sold or listed the property are routinely misrepresented. When pulling comps, I must research the listing history and sometimes call the agent in order to determine the actual facts of a sale.
Example: Condos are often sold furnished. The MLS offers a listing agent a choice of "full", "partial" or "optional/negotiable" as regards furniture and furnishings. I have yet to see a listing agent specify in the concession comments of a closed sale whether the "optional/negotiable" furnishings were included or not. Several tens of thousands of dollars worth of furnishings that were included in the final sale but not noted on the closed listing makes that sale a misleading comp. Similarly, paying for the furniture outside the contract makes the recorded sales price misleading if the original listing noted furnishings as "full". If either or both of the agents involved in the deal accept less than the posted commission amount the comp is likewise tainted. I am aware of a sale in which the seller received a free two week stay in the unit every year after closing for life. That certainly makes the selling price unreliable as a comp.
Buyers and sellers of real estate need to keep in mind that the details on the comps they and their agents are using are very often incomplete and sometimes deliberately inaccurate. Appraisers know this and often call participating agents asking for details about closed transactions. Similar calls from agents are practically nonexistent. I assume most are taking the comps at face value. I know better.
What is going on with the traffic light at Brevard and Minutemen Cswy? Anyone?
Golfers, do not take the lightning threat lightly. Last week lightning struck the flag stick on number six on the River course and printed a beautiful big image of lightning into the grass of the green. It could have been on of us.
"I’m doing this intermittent fasting thing where I don’t eat for 45 minutes after each meal." ______Josh Brown
Tuesday, April 23, 2019
Easter 2019 is behind us as we slide into the brief slow season between the snowbirds and summer vacationers. Our supply of condo units for sale stands at 276 units this morning in Cocoa Beach and Cape Canaveral. Sales have been brisk so far in April with 56 units reported as closed so far in the month. We ended March with 71 units closed so, at our current burn rate, we have about a 14 week supply of condo units in our two cities. That helps explain the frequent incidence of multiple offers we're seeing. Demand still exceeds supply.
Single home inventory stands at 62 currently for sale with 27 sold since March 1 so a similar demand/supply imbalance exists there as well. It is imperative that buyers, whether they are looking at condos or single-family homes, talk to their lenders before they start looking at properties. A short delay getting a pre-approval letter could mean losing a desirable property to a more well-prepared buyer. Cash buyers are obviously in a stronger position.
Sellers, please check your MLS listing for inaccuracies and omissions. The condo listings in the MLS without the condo name entered are probably missing showings. It doesn't matter whether the listing agent made a mistake or doesn't know how to enter that info. A missed showing is a potential missed sale. Also, those who elected to go with a MLS entry-only listing to save money may want to reconsider whether the language in the agent remarks stating that "the buyer or buyer's agent will pay a $XXX fee to listing broker at closing" is an enticement or a hindrance. My vote is hindrance.
The ocean water in Cocoa Beach has been Caribbean clear for the last two weeks and is as beautiful as it gets. The Banana River is clear as well after a prolonged period of turbid water. Traffic is noticeably lighter now that Easter has passed and the business golf league has started back up for the year at the Cocoa Beach Country Club. Everyone is invited to join us as we play nine holes every Tuesday, tee times anytime between 12 noon and dark. Skins and closest to the hole prizes for those that want to participate. Join us.
“I'm gonna soak up the sun, While it's still free, I'm gonna soak up the sun, Before it goes out on me.” ___Sheryl Crow