Monday, January 25, 2010

Great Expectations 2010

Let's compare January 25, 2010 to January 25, 2009. This year 57 contracts have been accepted since New Year's Day with 19 of them short sales. Last year saw only 39 contracts in the same period with 16 being short sales. Our condo inventory in Cocoa Beach and Cape Canaveral shrunk by 162 units since last January while single family home supply increased by 20. Closed sales so far this month have exceeded last January's total. That and the increase in accepted contracts so far is encouraging except for the low inventory. Unless the spring flood of new listings happens soon, the increase in sales will likely fizzle. Picking off the good ones at the moment is requiring even more aggression on the part of buyers.

MLS inventory Jan 25, 2009 Cocoa Beach & Cape Canaveral

Condos, all prices_____720
over $500,000_________94
Single family homes___108
over $500,000_________33

MLS inventory Jan 25, 2010 Cocoa Beach & Cape Canaveral

Condos, all prices_____558
over $500,000_________76
Single family homes___128
over $500,000_________48

OK, now for a couple of stories from the trenches for those of you who like that sort of thing.

I called a listing agent about a new oceanfront condo listing last week to get in and preview for an out-of-town buyer. She informed me that because there were tenants in the unit who wanted to be disturbed as little as possible that only pre-approved buyers would be allowed to view the unit. No problem, my client is paying cash and has bought multiple similar condos in the last year and is very interested in her listing. I have successfully put together several purchases for him by viewing the properties and sending photos and handling the purchase without his ever setting foot in the units. Not good enough. Only agents accompanied by their pre-approved clients will be allowed into the unit. What the..? This is the kind of idiocy that agents wanting to sell property are faced with daily. And I thought having to drive across town to pick up a key to show a property next door was annoying.

Then there's the group of siblings I met with last week about selling their recently inherited condo to an interested buyer. I provided them with the three latest comps in their building. They informed me that another real estate agent had "appraised" their unit at a number $65,000 above the recent sale of an identical floor plan in much better condition and that they wanted to net $88,000 more than that last seller. I replied that that was very unlikely to happen considering the reality of the comps. After an uncomfortable silence with all of them staring at me like I had just sprouted antlers, one of them stated that he had just read that the market was moving up and that their expectations were realistic. They did call back a couple of days later and said, after thinking it over, they'd accept a mere $38,000 above what the last seller accepted for his nicer unit. We'll probably see this unit listed on the MLS soon by the agent that gave the crazy high "appraisal". His strategy is a well-used one, lead sellers to believe that their property is worth more than it is, get the listing and wait for the market to deliver a dose of reality. Then you can start dropping the price and, hopefully, eventually attract a buyer and cash a commission check.

"Take nothing on its looks; take everything on evidence. There's no better rule."
_______Charles Dickens

Saturday, January 23, 2010

Trust your sources, or don't

A reader's comment on the last post about using Zillow for info on our market piqued my curiosity. I wondered whether the website that I long ago dismissed had gotten more accurate since it's arrival in 2005. Below are some random stats of recently sold south Cocoa Beach condos that I pulled from the site this morning. Readers can make their own decision on the relevance of the site as pertains to Cocoa Beach property values. The examples below would seem to infer that runaway appreciation is back and/or that some buyers are wildly overpaying. My take is that neither is true.

[The "Zestimate" is Zillow's estimate of a property's value.]

River Bend #403
Sold October 2009 __ $240,000
Zestimate Jan 2010 __$347,500

Windsong #101
Sold December 2009 ___$400,000
Zestimate Dec 2009 ____$273,000

Waters Edge #101
Sold November 2009 ___$245,000
Zestimate January 2010 _$333,500

River Villa #101
Sold August 2009 ____$268,000
Zestimate Aug 2009 __$182,000
MLS Inventory January 23, 2010
Cocoa Beach and Cape Canaveral

Condominiums, all prices_____558

Condos over $500,000________75

Single family homes, all prices__127
Homes over $500,000__________48

Many of the popular real estate sites on the internet do not have up to date information. If you'd like real time access to our MLS you can search all listed properties at No need to put up with the lag time of the other secondary sites that can be as much as 30 days behind.

I'd rather be hated for who I am, than loved for who I am not."
______Kurt Cobain

Friday, January 15, 2010

Warm again, and not a minute too soon

Halfway through the first month of the new year and a total of only eight MLS-listed condos and townhomes and two single-family homes have closed in Cocoa Beach and Cape Canaveral. Two of the ten were short sales. The MLS is showing 98 residential properties as contingent this morning in the two cities with 65 of those listed as short sales. We are still waiting for the rush of new listings from sellers who were waiting for the spring "selling season". There are, however, a couple of new listings of very nice non-direct ocean units in oceanfront buildings in south Cocoa Beach that appeared in the last week aggressively priced at $119,000 and $134,000. I toured a direct ocean, corner luxury unit this week also in south Cocoa Beach that is not listed but can be purchased for a very fair price, far below similar sized new units. And, if there's a quiet, well-behaved couple or small family out there who would like a furnished direct ocean rental in south Cocoa Beach for a few months or longer for an outstanding price, I know of one that will be available shortly. Not a condo. Email me for details on any of these.

In random news, Cocoa Beach has installed it's first red light camera at the light in front of Wendy's just north of the old Publix shopping center. I expect this thing to pay for itself rather quickly. The Cocoa Beach Holiday Inn became the International Palms Resort at some point in the last few weeks. Details are still sketchy. And, after a week and a half of freezing temperatures temps have moved back into the 70s today and the locals are downright giddy. In addition to damage to some tropical plants inland, the prolonged cold killed thousands of fish in the river, primarily snook, trout and tarpon. The redfish appear to have been less susceptible to the cold.

"A lot of people like snow. I find it to be an unnecessary freezing of water."

_________Carl Reiner

Sunday, January 03, 2010

2009 Cocoa Beach real estate in review

Where to begin? Even though the number of sales in our market in 2009 was up over the previous two years, declining prices meant quite a bit of frustration for those selling and for those facilitating sales. For Realtors, loan officers and title companies, more stringent mortgage requirements and quirky new appraisal rules meant large numbers of failed sales as did the difficulty of consummating short sales which blossomed across the real estate landscape in 2009. When a sale fails to close, there are no pay checks for those facilitators. For sellers, those serious about selling their properties were forced in most cases to accept far less than they had hoped for. One island of positivity in the challenging year was the unexpected surge of sales in the fall. The number of condo sales for the last four months of 2009 in Cocoa Beach and Cape Canaveral was more than 60% above the number in 2008. The abnormality of a fall surge in condo sales is apparent in the chart below of the last three years of closed MLS-listed condos and townhouses.

That surge in sales combined with a reduction in new listings contributed to the continued 3-year inventory shrinkage in our market and we are now at almost exactly half the inventory of just three years ago. We are entering 2010 with 647 residential listings on the Cocoa Beach MLS in the two city market including Cape Canaveral. 19% of those listings are listed as either short sales or bank-owned. Hopefully the new year will bring some priced-right new listings. The picked-over listings making up the current inventory are predominately over-priced properties that were overlooked last year in favor of those that were priced within striking range of reality. This dearth of inventory will likely lead to a reduction in sales for 2010 unless some unforeseen event supplies us with easier mortgage money or a lot more realistically-priced listings. If you're looking to buy, be aware of the trend.

After a brief pause at the end of December, mortgage rates have resumed their upward trend. We have predictions from both camps on the direction for 2010 with those calling for higher rates in the majority. Not good for sellers but very good for cash buyers.

"You're only as big as your battles."
___Michael Stipe

Saturday, January 02, 2010

New Year Predictions

Comments to my last post on interest rate predictions gave me the idea to ask for readers' predictions for the coming year. I'd like to hear your predictions for 2010; interest rates, home prices, employment, gold prices, inflation, stock prices, government interventions or anything else you care to offer a prediction on. Just click on the comment button below this post and let us know your thoughts. Please enter some nom de guerre (fake name) if you choose to post anonymously rather than leaving the name blank.

"Did you ever think that making a speech on economics is a lot like pissing down your leg? It seems hot to you, but it never does to anyone else."
____Lyndon B. Johnson