Friday, April 05, 2013

Reviewing March 2013

March 2013 was a blockbuster month for residential property sales in Cocoa Beach and Cape Canaveral. Monthly condo sales of 71 units in the two cities tied the highest month since 72 units sold in March 2006. In addition to the 71 condos there were 13 single family home sales. Of the 84 closed sales, 22% were distressed, either short sales or foreclosures. Of the remaining 355 properties for sale, 8.5% are distressed.

Twenty six of the condos sold were in oceanfront complexes with 17 of those in direct ocean buildings. Ten of the closed condos were in riverfront complexes. The highest priced condo sale was a 3rd floor south ocean view Sol y Mar with 3020 square feet that sold for $455,000. There were 13 condo sales for $300,000 or above and 17 for less than $100,000. Three single family homes closed above the $600,000 mark, all riverfront.

The ratio of condos closing with financing is rising with the cash/mortgage ratio for March at 4/3. Our meme of swift action and aggressive offering prices continues to be rewarded. Multiple offers have become the norm again for attractive properties. For buyers wanting a specific property, do not let the dreaded multiple offer scenario deter you. I know it's common to think the seller and their agent are playing games but that fear is just background noise in the grand scheme. Proceed with the strongest offer you're comfortable with and hope for the best. Cash, as always, is more attractive to a seller as it removes all the uncertainty of an offer contingent upon a mortgage. A contract contingent upon a mortgage can fail for several reasons including low appraisal or condo association issues. Issues that underwriters frown upon can include low reserves, not enough cash in the association's accounts to cover insurance deductibles, unacceptable ratios of investor owners and too many delinquent owners to name a few. Then there is the all-too-common occurrence of the lender just not having it all together by scheduled closing date.

All the moving parts of a mortgage conspire to delay or kill the closing. Early in the process there is required documentation from the borrower and the association, then the appraisal and underwriting. A delay of any of these will domino the delay down the line. If you're getting a mortgage it is vital to deliver requested documentation on time and prudent to ask your lender if everything is on track. It is not uncommon to close exactly on time but it is unfortunately not uncommon to have to request an extension because the loan did not receive final approval in time to hit the contract closing date. Sellers should be asking their agent to monitor the buyer's loan progress.

The first big wave of departing snowbirds has taken flight and the flock has been reported moving slowly northward through upper Florida and Georgia. Their places in the sun have been partially filled by wave two of spring breakers who will be gone next week. They will be replaced by the last and smallest wave of out-of-schoolers who will arrive to a mostly deserted town and beach. The third week in April Cocoa Beach will officially roll up the sidewalks and turn off all traffic signals. Restaurants will cut menu prices in half and golfers will be paid $10 per nine holes to keep the golf course in use. The ocean water temp will jump to eighty degrees in just a couple of days and residents will have to start raking jumbo shrimp off the sand every morning before taking the first swim of the day. We don't complain as this just a part of the drudgery of small beach town living post season.

"If you're offered a seat on a rocket ship,
you don't ask what seat. You just get on."
_____________________Eric Schmidt