The Jacksonville real estate market is a very interesting thing.

Sometimes an experience is so completely "out there" that I feel obligated to share my experience.  This week we had a buyer ready to put in an offer on a home in a St Johns County neighborhood.  The home is absolutely gorgeous.  wood floors, beautiful colors, a kitchen begging for the next Paula Deen...it is a fabulous home.  The price seemed pretty reasonable.

As we always do, we ran comps for the buyers when they were trying to decide what to offer.

The home is priced in the mid-$200s.  There are three others priced in the $300s.  All roughly the same size.  Seemingly a great deal.

Ooops!  There are only three comps for the past year.  All roughly the same size. They sold for only $185k, $189k and $200k.

Because there are three comps in the same neighborhood, and they are all within the year...we don't know how an appraiser could possibly appraise the home for the seller's asking price.  And we KNOW an appraiser couldn't even begin to justify the sales price for the other three homes that are priced in the $300s.

Where are these asking prices coming from?  Do they really believe they can get those prices for those homes considering the recent comps?

My guess is that they are trying to avoid a short sale situation.  Buyers are not (or at least SHOULD NOT) going to overpay for a home just because the seller does not want to go short.  This is an impossible situation.  A cash buyer could overpay like this, but WHY would they?

Price your home correctly or don't even try to sell it in this current Jacksonville real estate market.

Yes.  

Say that again?

Yes.

As we are in the fifth year of the real estate market downturn I would have assumed that this would be common knowledge.  Working in Jacksonville short sales and Jacksonville foreclosures like we do, our team is always surprised with this myth is resurrected.  

It usually happens something like this...

"Your listing on 123 Short Sale Lane is only worth 300,000 because regular resales have been going for $350,000 and this is a short sale..."

or like this...

"Of the 10 homes that closed in the last 3 months in Ponte Vedra community A--the smallest had 3500 square feet -- I have emailed you the the MLS listings for those solds-- only one of them was a short sale.  "

We just listed a beautiful Cornerstone built home (fabulous attention to detail!!!) in the Austin Park section of Nocatee in Ponte Vedra.  This is the best available price in Austin Park right now and is priced at only $230,000.  This home is a 3/2 with an office and a versatile floor plan that makes the home feel much larger and allows for different configurations.

This Nocatee home has many fabulous upgrades!  The owners had the home customized from the original plans.  One of the modifications they did was extending the eat-in kitchen.  This created more cabinet and counter space for the cook.

The landscaping is beautiful in the front and back of the home!  The home is located on a preserve lot with a nice fenced back yard.  There is also a screened lanai and an open patio with pavers.

Nocatee is a beautiful planned community just west of Ponte Vedra Beach in Ponte Vedra, FL.  The Nocatee community boasts a shopping center, water park/pool complex with a lazy river, trails and much more.

• Buyer with their loan lined up calls us because they want to see a Jacksonville condo listing.
• Called to make an appointment to show the unit to the buyer.  Its tenant occupied so they have to get the tenant to approve showings.
• Hours and hours later still no confirmed appointment.  Meanwhile anxious buy er wants confirmation that they can get in.  Likely can't understand why we can't make it happen for them.  Is the home for sale or is it not for sale?  Are we even trying to get them an appointment?  
• We receive a confirmation call, the Jacksonville condo is okay to show.
• Great!  What is the gate code?
• Agent does not know the gate code.  Tells us to come before 5:00 (buyer can NOT!!!) so the maintenance people can let us in.  Huh????  The agent was not willing to lift a finger to get us a gate code.

Our options at that point (none of them good): 

1)  Figure out the gate code ourselves

2)  Figure out the gate code ourselves

3)  Don't show the property.

A Jacksonville home buyer will not buy your home if they can't get access!

If you are a Jacksonville home seller, are you making your listing hard to see?   Do you want to SELL your home?  Do you know how showing appointments for your property will be made?  Do you have any idea how many Jacksonville FL real estate listings are out there?  So many times we have such a hard time scheduling appointments to show our Jacksonville home buyers listings that are for sale.  When a buyer can not get in to see your home when they want to see it, many, many times they do not come back. 

Make sure you know your home is going to be easy to show to potential buyers before you list your home.  Make sure your agent is going to do whatever they can to make sure your home is accessible to Jacksonville home buyers before you select that agent to list your home. 

How many home buyers are lost because the person who WOULD HAVE purchased that home could not get in?

There is no way to know for sure but we are betting, from our experience, that it is much more frequent than one would guess!

The Jacksonville real estate market is tough.  T-O-U-G-H (although a great agent can make it considerably less tough).  There are far fewer buyers than there are listings.  Do you want to "list" your home, or do you want to SELL your home?

This is a Jacksonville FL real estate scenario that played out this week on our team:

• Jacksonville foreclosure property owned by Freddie Mac hit the market last week for $37,900.
• Our buyer offered $40,000, cash, two weeks to close.  Did not ask for anything extra.  Completely clean offer.
• Offer submitted to listing agent Friday to expire on Saturday.  There was time to submit the offer before expiration.
• Agent confirmed receipt but did not submit to Freddie Mac prior to expiration of offer, instead held onto the offer, presumably to help solicit other offers.
• Late Monday we get a message that there are multiple offers and we need to submit our highest and best offer along with the Freddie Mac foreclosure multiple offer disclosure form.
• Tuesday we heard back that the offer would not be submitted without this form.  The buyer was unavailable so we were not able to submit the form that simply said that we had to provide our highest and best by xx date and xx time, we understood there were multiple offers, blah, blah, blah.  So from our understanding our buyer's offer was never submitted to Freddie Mac by the listing agent despite being submitted to the listing agent.


So How is Trying to Purchase A Jacksonville Foreclosure Like Playing Blackjack?

This scenario is not the least bit unusual for Jacksonville REO properties.  This is the foreclosure game that you have to be aware of if you would like to pick up a foreclosure in the Jacksonville real estate market.  You have to give it your best shot because you do not know what cards the dealer, (a.k.a. the listing agent") is holding.  But just like blackjack you have to understand the odds are in their favor.

Are there REALLY multiple offers on that foreclosure you just bid on?

Are we seeing multiple offers in this market?  Absolutely!  What are the odds that EVERY SINGLE foreclosure that we have a buyer bid on really has multiple offers?  In our opinion the odds are not very high, yet this is the message we get on every foreclosure, with very rare exceptions. 

It does not matter if it is the first day on the market or the 365th day there are almost always "multiple offers."  Seriously.  We've put in offers months after the homes came in the market and gotten this message.  We've also put in offers HOURS after the Jacksonville home came on the market and gotten this message.

So if there are really a zillion offers on every foreclosure properties does that mean that Jacksonville foreclosures are underpriced?

The game is that the home is usually listed for less than it is worth in an attempt to solicit multiple offers and drive the price up over asking.  This makes the listing agent look good for achieving multiple offers over asking price.  This perception of a job well done occurs even if the home is dramatically underpriced in order to make it look like the home, and the agent, fetched a good price.  In return that agent is rewarded with more listings.

Can I even GET a Jacksonville foreclosure?

Of course!  If you are a Jacksonville home buyer looking to pick up an REO, work with an agent who knows how the system works. How bad do you want the property?  Are you willing to walk away or do you feel like you absolutely have to have this home?  This particular buyer wasn't willing to increase the offer on this particular unit based on the comps so it went to another buyer instead.   Understand that the amount the home is worth is based on the CLOSED comparable sales for the past 3 months or so (as the market has continued to trend lower).  Asking price is somewhat irrelevant if you want to buy a property.  Make your offer based on what it is worth and your level of motivation and get geared up to play the game. 

Short Sale Approved by Wells Fargo in only 48 Days!!!  Sellers had only missed one payment!

Wells Fargo waived the right to pursue a deficiency in writing.

If you are a Jacksonville home owner who owes more than your Jacksonville home is worth, you are not alone.  Most Jacksonville FL real estate sellers we talk to these days are in the same situation.  This particular Jacksonville home owner had a growing family who had outgrown their living space.  We helped them find a new home in St. Johns County, in a new home community, that we helped them purchase from a builder.  They planned on leasing out the condo after they moved into their new home.  After the closing of their new home, they were denied the right to lease their condo by the association.  They had no choice but to try to sell their Ponte Vedra Beach condo.

We were able to help them sell their Ponte Vedra Beach condo for more than fair market value (highest comp in community in the past 6 months).  We were able to help the sellers get out from under the burden of two home payments and move on with their life.

Who you choose to work your Jacksonville short sale can make a huge difference.  Select someone with experience who knows how to get the job done.  Just because someone took a class in short sales, or calls themselves a short sale expert, does not mean that they are.  You can only learn to successfully work short sales with experience.  Jacksonville short sales are very challenging real estate transactions.  They are never easy, and the bad ones are nightmares with seemingly endless obstacles that must be pushed through and problems to be solved.   If you choose the wrong agent to help you through the Jacksonville short sale process, you may end up far worse than you started. 

Terms of the approved Jacksonville short sale:

• No promissory note
• Wells Fargo agreed to waive all deficiency rights
• Initially Wells Fargo was requiring $5,000 seller contribution or a $12,000 0% interest promissory note to be paid back over ten years.  We got the number down to a $2,500 cash contribution. 
• All closing costs covered by Wells Fargo.

Seller only missed one payment at the time of the approval, which was not yet 30 days late.

You can see this Jacksonville short sales / Wells Fargo short sale approval letter here.

Are you in a situation where you can no longer afford to keep your home?  Have you tried to work things out with the bank to no avail?  Call us for an honest evaluation of whether we think we can help you.

• Buyer fell in love with a Jacksonville short sale property he found on the internet. 
• Spoke with the listing agent at length.  He said a BPO had been done and he knew exactly what the bank would accept.  WHICH WAS THE LIST PRICE.
• We ran comps and spoke with the buyer who was comfortable proceeding with and offer for the price the bank needed based on the recent sales in the area.  The offer amount was for the list price.
• 4/22 We wrote the offer up, the buyer signed it and we sent it over. 
• 4/26 we were sent the contract back signed by the seller (signature date 4/25 after the offer had expired, however the buyer was still happy to proceed). The home went under contract and was placed as contingent in the MLS system.   The seller's agent stated that he was going to send in the contract to the bank that day.
• 5/6  We checked in with the seller's agent, asking if he had heard anything back yet on the short sale.  The response back was that all documents were submitted including the HUD-1 and that he would update us.
• 5/9  Seller's agent sent us a message back from BOA saying that the file had been assigned to a negotiator.  However, upon scrolling down and reading the whole e-mail we discovered that the short sale package wasn't even submitted to Bank of America until 5/6 the day we first inquired about the status and ten days after we were told it was being submitted.  (If you are familiar with Jacksonville short sales, you know that you can't afford to "waste" any time before getting everything in because of how lengthy the process can be.)
• 5/11 Listing agent forwarded us a response from BOA.  They were demanding a sales price of approximately $25,000 higher....FAR MORE than the home was worth!  The listing agent asked the bank if a new appraisal could be done.  He/she was told no because the appraisal didn't expire until the next month.  
• Upon the demand for above-market-value on the home, the wise buyer decided to select a different home instead.  But this buyer, who was sitting on a lease that was running up fast, was out a couple of weeks on a short sale that the listing agent should have either known was not going to happen, or had a game plan to try to work around the appraisal that he had to have known about.

This situation could have been much worse.  We could have gone on for months in this contract without knowing that it was a "dead end" for the buyer.  The worst case scenario is when a Jacksonville short sale buyer waits for month and month on end, forgoing many other opportunities, to only find out that they are not going to get that house.

We love helping sellers sell their Jacksonville homes.  We don't mind taking Jacksonville short sale listings, like many agents do, because we know how to successfully close a Jacksonville short sale.  We also appreciate the opportunity to help sellers sell their Jacksonville home and take a step forward to financial recovery.

Helping Jacksonville FL real estate buyers purchase short sales can be a little trickier.  Not because we mind getting helping a buyer purchase from a seller in need...we love that part of it.  It is very challenging on the buyer agent end of a short sale.  When we have the listing, we have control, and know that the Jacksonville short sale is being worked correctly.  We know how to work through "no" to get to a "yes."  We know how to attack, and keep attacking the challenges that pop up when you are listing a short sale.  With a buyer who wants to purchase a short sale, we don't have this power or control of the situation. 

Buyer agents who have a buyer that wants to purchase a short sale have limited, to no, control of the situation.    We can get an approval on almost any short sale when we are working for the Jacksonville home owner.  When we are representing a buyer, it's a toss up.

It is so important to hire the right agent to represent you in the current Jacksonville FL real estate market.  The current environment of the market is anything BUT business as usual.

The percentage of Jacksonville real estate market transactions that were distressed sales continued to increase from February (up from 62% of sales to 64% of non-builder sales) Other numbers show a worsening real estate market for Jacksonville home owners as well. 

In February the percentage of straight resales sold (non-distressed, non-builder) was 35% of the market.  In March this number dropped to less than a third of the Jacksonville real estate market sales at only 32% of all sales.

This is negative news for Jacksonville home sellers.  Home prices continue to decline with the high level of distressed properties on the market.  It is very important for the Jacksonville home seller to price their home correctly to have a shot of competing with the distressed properties. 

 Jacksonville home buyers are choosing price. 

 
While almost 60% of Jacksonville FL houses on the market today are straight resales (non-distressed, non-builder) that is not what is selling at a high level.  As evidenced by the statistics, Jacksonville home buyers are picking from a smaller pool of listings (short sales and bank-owned properties) to look for value. That is why we are seeing such a high level of short sales and bank-owned properties sold, because in general, they are priced at the low-end and represent the best values for Jacksonville home buyers.

If you are thinking about selling your Jacksonville home, can you give them that?

This is not 2006.  This is 2011.  There are many things about your home that you may love, but Jacksonville home buyers can do without.  They are no longer willing to overpay.  They will go down the street to the one that they don't like quite as much, but has a more favorable price tag.  Everything is relative to the competition in your particular niche of the real estate market. 

Home buyers do NOT CARE how much you owe the bank.  They are not going to pay more for your home just because you have to have that much to pay off your mortgage. 

Jacksonville home buyers have an excessive amount of inventory to choose from, why would they choose yours?

When your Jacksonville home is overpriced, you serve one function....you create noise for the savvy home sellers in Jacksonville FL that chose to price their home correctly.  In short, YOU MAKE YOUR NEIGHBORS HOME LOOK GOOD!  When you are overpriced you help to sell someone else's home for them. (Ouch?)

Jacksonville home buyers chose the home they chose for one reason these days...VALUE.

Can you give them that?  Or are you just noise?

Jacksonville home sellers can usually avoid months and months of frustration just by pricing their homes right.  They usually end up netting more money if the home is priced right from the beginning.  (Do you want to sell your home for $X today, or $X minus thousands, ten months from now...) Hear about how there is nobody looking at homes?  This is not the case.  When the price is good, so is traffic.

Jacksonville home buyer traffic is good!

We get a lot of buyer showings on our houses for sale that are priced right.  Buyers know right away when your home is not.

We often get multiple offers on our listings that are priced right.  Multiple offers????  In this market????  YES! 

Call us for an evaluation of what the right price is for your home before you put your home up for sale.  You can count on honesty and the analysis and presentation of comps to back up today's value of your home. 

More information on houses for sale Jacksonville FL.

We offer FREE Jacksonville home buyer services (we help you buy your new home and our help costs you NOTHING!) and tools for Jacksonville home buyers.  We provide a lot of information to the general public in hopes that you will call us when you are ready to buy your new Jacksonville home.  We are always striving to provide better tools for those looking for houses for sale in Jacksonville FL.  This starts with our Jacksonville real estate website.  We just made some major improvements to some community pages and wanted to let you know. 

Large Planned Communities in Jacksonville FL area:

• Nocatee FL - Real estate information and houses for sale Ponte Vedra FL (huge new community located in St Johns County in Ponte Vedra Florida .  Just minutes south of Jacksonville, community starts at US 1 and ends at intracoastal in Ponte Vedra.
• Bartram Springs FL - Real estate information and houses for sale Jacksonville FL (development in Duval County between Old St Augustine and Racetrack road just west of I-95)
• World Golf Village FL - Real estate information and houses for sale St Augustine FL (halfway between St. Augustine and Jacksonville just west of I-95)
• Palencia in St Augustine FL - Real estate information and hones for sale in Palencia.  Palencia is located between US1 (east of I-95) and the intracoastal waterway approximately 15 minutes south of Jacksonville FL.

Other Jacksonville FL home information and St Augustine FL home information:

210 Corridor Real Estate - Real estate information, houses for sale and subdivision information for the 210 Corridor which is the dividing line between St Johns FL (32259) and St Augustine FL (32092) just west of I-95.

• St Johns Forest
• St Johns Golf and Country Club
• South Hampton
• Cimarrone
• Stonehurst Plantation
• John's Creek

World Golf Village area communities (n0t part of WGV) located off of International Golf Parkway west of I-95 in St. Augustine FL.

• MuraBella
• Sevilla

Other Houses for Sale Jacksonville FL

• Jacksonville Golf and Country Club - Jacksonville FL real estate located in the Southside area of Jacksonville off of JTB between Kernan and Hodges.

Other Houses for Sale St Augustine FL

• Kensington - Kensington is a newer home community (non-CDD) located in the Palencia area of St Augustine FL approximately 15 minutes from Jacksonville FL

The Jacksonville condo market has been hit hard by the housing downturn and further by the FHA approved condo list and lending guidelines related to that list and financing condos.

February 2011 Jacksonville condo market statistics:

• Total Jacksonville condos sold (Jacksonville metro area) - 177
• Jacksonville condos sold that were foreclosures/REOs/bank-owned properties - 82
• Condos sold that were short sales and pre-foreclosure sales - 53
• Condos sold that were distressed properties - 135
• Condos sold that were builder sales / new construction- 9
• Condos sold that were non-builder sales, non-distressed (foreclosures/short sales, pre-foreclosures) properties - 33

Only 18.6% of Jacksonville condos sold in the Jacksonville real estate market in February 2011 were non-distressed (foreclosure, pre-foreclosure, short sale) or non-builder sales.  This is a very low number indicating continuing trouble for the Jacksonville condominium market.   Distressed sales, which include Jacksonville foreclosures, short sales and pre-foreclosure sales made up a remarkable 76.3% of condo sales in February. 

If you need to sell, this means that you have to look at pricing carefully.  Is your condo FHA approved?  Do you know what others have been selling for?  The market does not care what you owe...what matters is what the home is worth.  If the market says your condo is only worth $50k (based on recent sales comparables) and you find a buyer for $100,000...they will not be able to get a loan for your condo at $100,000, the appraisal will show the buyer's bank that the home is really only worth $50k.

If you are buying, are you an all cash buyer?  Do you need financing?  Make sure you are only looking at homes that you can get financing for.  Make sure you are working with an experienced, qualified real estate agent (and lender!!!) who understands the lending environment and how the large number of complexes that are not FHA approved affect you.  The last thing you want is to fall in love with a condo then discover that you will not be able to obtain financing on it based on your situation in the current lending environment. 

 

The preceding is a graph of February 2011 Distressed Sales in the Jacksonville real estate market.  (Jacksonville foreclosures, Jacksonville pre-foreclosures and Jacksonville short sales) vs.  Straight resales by owner (non-builder, non-bank) as entered in the Jacksonville MLS system

February 2011 Jacksonville Real Estate Market Statistics

• Total Jacksonville Real Estate Sales - 840
• Jacksonville Foreclosures Sold in February - 338  (40.2% of all Jacksonville real estate sales were foreclosures)
• Jacksonville Short Sales/ Jacksonville Pre-Foreclosure Sales - 138  (16.4% of total real estate sales)
• Jacksonville Distressed Property Sales - 476 (56.7% of all Jacksonville real estate sales!!!)
• Jacksonville Sales that were not Distressed Property Sales - 364
• Jacksonville Builder Sales /New Homes - 73  ( 8.7% of total sales recorded in the MLS for the month.  This does not include builder sales that were not recorded on the MLS.  The number could be quite a bit higher)
• Straight Resale Homes Sold in Jacksonville - 291  (34.6% of total Jacksonville Real Estate Sales)

 
 
The preceding chart shows February closed sales of Jacksonville real estate listed on the Jacksonville MLS system by type. 
 

Nocatee

We can help you for FREE whether you are looking for a resale in Nocatee or a new home from a Nocatee home builder.

Did you know the builders will pay for us to help you purchase a new Nocatee home from them?  We can help you find your new Nocatee home and help you through the process like we have helped many other Jacksonville new home buyers.

• Do you know the builder  incentives you may be eligible for?
• Do you know that you should still get a home inspection?
• Do you know the lending options you may have?
• Do you know that you can negotiate with builders?
• Do you know about CDD fees and what they mean to you?
• Do you know what other Nocatee homes have recently sold for?
• Do you have access to sold comps?
• Do you know the options you might have?

We can help you sort through the details of your purchase of Nocatee real estate FREE to you!

Nocatee Homes For Sale - Nocatee Real Estate Listings:

• $200,000 and Below priced home for sale
• $200,000-$300,000 priced homes for sale
• $300,000-$400,000 priced homes for sale
• $400,000-$500,000 priced homes for sale
• $500,000 and Up priced homes for sale


Nocatee real estate includes the communities of:

• Greenleaf Village (Single family detached homes)
• Kelly Pointe (Single family detached homes)
• Austin Park (Single family detached homes)
• Coastal Oaks (Detached Homes and Townhomes)
• Willowcove (Single family detached homes)
• Riverwood (Single family detached homes)
• Tidewater (Condos)

I had gone on a listing appointment in 2006.  It was a beautiful home in John's Creek in Northwest St Johns County.  I could tell in the first ten minutes that I would NOT be walking away with the Jacksonville real estate listing and I was okay with that.  Why?  Because I was honest about the fair-market-value of the home.  I didn't say what the home's sellers wanted to hear and was well aware of it.  But I am in the business of selling homes in Jacksonville, not listing homes in Jacksonville. 

I later noticed that the home had been listed for around $50,000 more than what the true value of their beautiful St Johns County home actually was at the time. 

The sellers had really NEEDED to sell their home because of a significant reduction in income.  They could have sold at the price I had given them without it becoming a Jacksonville short sale, besides who in Jacksonville had even heard of a short sale in 2006?  But they listed the home far too high hoping to get "more out of it."

I forgot all about it until today when I was scrolling through and ran across this home.  Surprised at the low price, I went into the history to see how it was priced that low.  Unfortunately the home was eventually foreclosed upon.

This is an extreme case (but not the only case) of what happened to a Jacksonville Florida seller, who really needed to sell their Jacksonville area home. Instead of getting it sold, they had insisted on overpricing their home despite being warned about the true market value of their home. 

The problem is this...if the condo you like (or if the particular building within the condo complex) is not on the FHA approved list, you aren't getting FHA financing on that Jacksonville condo you want to purchase.  Why is this important?  In our experience, most Jacksonville buyers who  want to purchase condos also need to go FHA. There are simply not a whole lot of financing options out there right now.

This creates a burden for many first time homebuyers and buyers who need to take advantage of the low prices in the Jacksonville real estate condo market.  This also creates a burden for sellers in the condo communities that are not on the FHA Approved list.  The FHA  list has taken many of their potential homebuyers away.  This can cause a seller to end up with a foreclosure...when they tried to sell their condo, but could not due to buyer financing restrictions.

There are some great deals in Jacksonville condos right now, but many Jacksonville homebuyers simply can't get financing on the condos to take advantage of the deals. 

Here are a couple of key points/restrictions/determining factors, from Mortgagee Letter 09-46,  for the FHA approved condo list:

• Delinquent HOA Dues - No more than 15% of units may be delinquent in their HOA dues.
• Investor Owned- No more than 10% of the units may be owned by one investor, this includes developers and builders who subsequently rent vacant and unsold units.
• Owner Occupancy Ratio- At least 50% of the units must be owner occupied or sold to owners who intend to occupy the unit.
• FHA Concentration-  FHA will not issue new case numbers once a 30% concentration of FHA insurance encumbered units has been reached in any particular development.
• FHA-to-FHA Transactions--Project approval is not required for FHA-to-FHA streamline finance or FHA/HUD REOs  (FHA won't allow financing on the short sale, but will allow it once the home is taken from the current owner in foreclosure???)

The FHA approved list, in our opinion, has further depressed the Jacksonville real estate market and resulted in unnecessary foreclosures in the Jacksonville condo market.  How many families have been devastated by the unintended consequences of this list?

Of course not!  Right?  Read on.... 

Jacksonville Short Sale Transaction Facts:

• Jacksonville Short Sale Contract Date - May 2009
• Contract Price for Short Sale - $237,500
• Appraised value of the home July 2009 - $240,000
• Carrington's Demand for Purchase Price on the Jacksonville Short Sale - $255,000 (!!!) Which they admitted was above fair market value.    SEE CARRINGTON'S REJECTION OF THE JACKSONVILLE SHORT SALE HERE.
• Buyer walked at the end of August 2009.


Servicer / Loan Originator / Investor Facts:

• Servicer - Carrington Mortgage Services (CMS)
• Original Loan Originator - New Century Mortgage (You can read about the lawsuits they disclosed to the SEC in 2007 here.)
• Investor Type : Mortgage Backed Security
• Investor's Trustee -  Wells Fargo
• Investor on Loan -  Carrington Mortgage Loan Trust, Series 2006-NC3 (no filings were found with the SEC since 2007 when they filed a Form 15 (under Rule 15d-6) representing they had fewer than 300 security holders of record) and the subsequently filed 10K.

House currently on the market as a Jacksonville foreclosure / Jacksonville REO for only $199,900.

 So not only have they lost almost two additional years of payments, but the bank/investor/trustee priced the home now that is an REO at only 78% of their above-fair-market value demand back in 2009.

Why?  Why turn away a ready, willing and able (and eager!!!) buyer to only hold onto an asset (in this case a home with a loan that had gone bad,  that they had to take back as an asset) in a declining market and lose an additional $40,000?  Is this in the best interest of the investors?   Insurance companies?  The sellers who are awesome people that were trying to do the right thing?  The taxpayers who keep throwing money at the banks through no decision of their own?

Are banks really in the business to lose money?  Why would they refuse a fair-market-value offer then wait two years to put the home on the market for approximately $40,000 LESS than what we had for them through our Jacksonville short sale?

This is not an uncommon event.  Who wins  when a Jacksonville short sale contract is rejected then the home goes back to the bank...then is listed for far less?

Price your Jacksonville real estate wrong and you could lose thousands...or worse.

What happens when you overprice your home?  You will likely get less money than had you priced it correctly in the beginning.

Jacksonville real estate should be priced with RECENT comparables to back up the sales price of your home.  The keyword is "recent comparables."  This does not mean comparables from 2006.  It means the absolute newest, freshest comps that you can find.  In addition the amount of distressed sales (Jacksonville short sales and Jacksonville foreclosures) in your neighborhood, and area, has to be taken into consideration as well.

Recent Comps do NOT extend to Jacksonville Real Estate currently for sale that has not sold!!!

Why not?  Because you can stick any price you want on a home and that does not mean that it is actually worth that price.  If your home is only worth $300,000...it does not matter if 15 of your neighbors, with almost identical homes, have theirs priced at $400,000.  What your neighbors have priced their home at does not create home value in the Jacksonville Real Estate Market.

Showing traffic is the biggest indicator that your Jacksonville home is overpriced.  If no one is coming to see it, it is probably not your Jacksonville real estate agents fault!  If no one is coming to your home and it is actively listed in the Jacksonville MLS system then the home is, far more often than not, overpriced. 

What happens when your home is overpriced?  Well, if the market is declining...you are losing money!  OVERPRICING YOUR JACKSONVILLE REAL ESTATE CAN COST YOU BIG!!!  At some point, buyers start to think something MUST be wrong with your home or it would have sold before now...wouldn't YOU think that if you were a Jacksonville home buyer?

So the question is do you want to just list your home for sale, or do you want to sell your Jacksonville real estate? 

You have to listen to the recent sales comps when you are listing your home for sale.  Someone who leads you to believe that your home is worth more than it is is not doing you any favors...they are costing you real money.  The Jacksonville real estate agent who gives you the lowest price in their market analysis may be the one most tuned in to the Jacksonville real estate market.

Nobody wins when you overprice your home in the Jacksonville Real Estate Market.  You lose.  Your agent who is working for free until the home sales loses.  And the buyer who might have thought your home was perfect had it been priced correctly...misses out on a great home.

It is important that Jacksonville real estate sellers try to remove the emotion and pay attention to the truth, whatever it may be.  

ASKING PRICE IS JUST NOISE.

Huh???

This is probably the most popular question we get regarding Jacksonville Florida real estate.  As a matter of fact we get tons of website visitors searching for the answer to this common question to apply to their offer to purchase.  The answer is, all the asking price should mean to you is it was an initial search parameter for you to see if you are interested or not.

So what matters?

What the Jacksonville home is worth.  The fair market value of the home is what you should be looking at.   If you are buying Jacksonville Real Estate, whether it is a Jacksonville Foreclosure, Jacksonville Short Sale, Jacksonville New Home or straight resale what you should be looking at is the value of the home in comparison to those that have recently sold.  Also look at what else is on the market.  Is there a similar home you could get for less?  Much less? 

The fact is, some asking prices are just ridiculous.  Sometimes they are ridiculously high, sometimes the asking price is ridiculously low.   Sometimes the asking prices of Jacksonville real estate are exactly where they should be.

I'll give you an extreme example:

• Let's say a home is priced at $500,000
• Recent Comparables suggest the home is only worth $350,000
• Do you really want to apply some formula of ___% of asking price that you saw in some book or your neighbor/son/uncle/etc. told you about?
• Or do you want to look at the value of the Jacksonville Real Estate in relation to what the home is worth?
• You WILL overpay if you make an offer in relation to asking price. (ie a certain percentage off of asking price)

Another example:

• Say there is a Jacksonville foreclosure / REO priced at $150,000
• Recent Comparables suggest the home is worth $200,000.
• Do you really think you are going to get the home if you offer some formula of ____% off of asking price...just so you feel like you get a good deal?
• In this scenario you could offer 125% of asking price and you would still get a pretty good deal...right?

If you are a Jacksonville buyer hoping to pick up a Jacksonville foreclosure or Jacksonville short sale this  is especially important.  In the Jacksonville foreclosure situation...there are many, many buyers hovering just waiting for that good deal to come up.  It is rare that we put in an offer on a Jacksonville foreclosure property that we don't find our buyer up against some multiple offer competition.  In a Jacksonville short sale, the bank is going to have either an appraisal or BPO that will give them a value of the property.  We are not seeing the banks let go of the properties in Jacksonville short sales for much, if anything, under what their belief is of fair market value.  (The bank's belief of fair market value of that short sale?  Another blog post for another day....)

If you are looking to buy a home in Jacksonville Florida...focus less on what asking price is and more on what you should be paying for the home based on what it is worth in today's real estate market, what your intentions are for the property (Long term?  Short term?) and how comfortable you are with potential future declines in the fair market value of the property. 

Many times (most?) after we submit an offer on a Jacksonville REO foreclosure we get the response that there are multiple offers on the property, "submit your highest and best."  Some buyers get mad when this happens, some call it ludicrous, but it is the reality of the Jacksonville real estate foreclosure market.  As a hopeful Jacksonville foreclosure buyer you should expect it.

Is there really another offer on the foreclosure property?  That is always the question.  We simply don't know. The listing agent can not reveal the details of the other offer.  There have been times where the home has been on the market for quite some time...it seems unlikely that there is another offer.  But there really may be one, as we have learned from experience.

Depending on who holds the property (bank, Fannie, etc.)  we may receive a form to fill out and sign regarding a revised offer on the Jacksonville foreclosure.  Other times the request for highest and best is just verbal or by e-mail.  It is then up to the foreclosure buyer to determine whether they want to increase their offer or not.  They do not know what the other offer is.  That is information that is not disclosed to us or the buyers. 

So the question is, will you increase your offer price because the foreclosure property has multiple offers?  Whether it does or does not, you may just be bidding against yourself.  There may be another offer that is far lower, or there may be an offer that is higher than yours. 

Here is a recent example of a Jacksonville foreclosure property that our buyer got:

• Asking price - $100,000
• Buyer's Original Bid- $100,000
• Got a message that there were multiple offers and to bring our highest and best.
• Buyer increased offer to $110,000
• Later, after we were under contract, a less than diligent individual in the listing agent's office copied us on an e-mail that we should not have been copied on that revealed the other offer.
• Buyer number 2 had only offered  $75,000.  (Would the bank had accepted EITHER offer had they both been around that price?  We doubt it...banks are more than willing to walk away from all offers and market the property longer. )

Here is another example of a hopeful foreclosure buyer we were working with who did not get the REO property:

• Asking price - $365,000
• Buyer's Offer - $272,000
• Bank refused to counter, asking for highest and best and citing other offers.
• Buyer's revised offer- 278,000
• Bank's Counter on the revised offer - $355,000
• Buyer refused to budge.  Buyer did not get the Jacksonville foreclosure.  But there really was another buyer as it closed soon after.
• Final Sales price of home pulled from the MLS - $ 340,000  (the buyer that got this home got an exceptional deal, this was an incredible house!!!)

And one more example of a buyer who did get the foreclosure from the bank, but almost didn't:

• Asking price - $157,900
• Buyer's Offer- $157,900
• Bank rejected buyer's offer, said they had accepted a different offer.
• One week later, out of the blue, the bank came back and "countered" the buyer's offer at $157,900.  (Yes, the same as the original offer amount.)  The buyer purchased the home.

One thing you can be sure of if you are in the market to purchase a Jacksonville foreclosure from a bank.  The experience will likely be predictably unpredictable.  Arm yourself with the numbers, recent comparable sales and know what you are willing to pay before you make your first offer.  Be willing to walk away if it does not meet your predetermined parameters.  Develop your strategy in advance and be prepared for the multiple offer call for highest and best. 

Here is a general summary of the misconceptions we see from most hopeful buyers of Jacksonville foreclosures that we talk to or work with:

1)  The banks are desperate.  (No they aren't.  They know that there is no shortage of Jacksonville foreclosure buyers out there.)

2)  You can steal the property from the banks because they are desperate.  (Refer to #1)

3)  You can bid as low as you want on that Jacksonville foreclosure and the bank will counter. (No they won't.  They are likely sitting on multiple offers or will be if the property was already priced under market.)

4) My _____________ (aunt, neighbor, dad, psychic, magazine, etc...)  says it's a bad deal if you can't get it for  X% of asking price.  (This depends on the individual property and how the asking price relates to fair market value.  This is something we help you assess by running comps on the property to see what others have sold for recently and how the price compares.  You can NOT accurately assess a good or bad deal based on the percentage of purchase price to asking price...EVER.  )

From the standpoint of Jacksonville real estate agent experienced in helping Jacksonville buyers purchase foreclosures here is my summary of the Jacksonville foreclosure market as it relates to putting Jacksonville foreclosure offers:

1)  The asking price of Jacksonville foreclosures are already great deals.  Jacksonville foreclosures are usually priced less than fair market value.   Sometimes considerably less.  Sure there are a few exceptions to this, like with anything...but almost every foreclosure my team has set foot in with a buyer is priced really well already.  (There is a reason that Jacksonville foreclosures come on the market already priced under market value...but that is another post for another day....)

2)  The Jacksonville foreclosure market is hot!  The lower the price of the listing, the hotter the competition will be. 

3)  There are multiple offers.  No matter how many days the home has been on the market, almost 100% of the time we receive a message that there are multiple offers on the property.  Sometimes this statement defies reason but it doesn't mean that it's not so (spoken from experience!!!).  The listing agent will come back and ask you to submit your "highest and best."  Are there REALLY multiple offers on a property?  I mean really?  It's like how many licks to get to the center of that Tootsie Pop.  "The world will never know."  UNLESS you lose the property because you are outbid.  Then it's too late. 

4)  If you "really, really, really want" a particular Jacksonville foreclosure property you have to bid it to win it.  If you are willing to move on to the next you can take your chances.  It is unpredictable.  You can know what the property is worth and bid to the dollar exactly what it is worth and you may or may not get it. 

5)  You have to move fast.  If you want to put in an offer on that Jacksonville foreclosure you likely don't have time to think too long about it.  You need to have a take action attitude.  Do your homework in advance.  If you are going to hem and haw for days you risk losing the property.   We have Jacksonville buyers who are looking for foreclosures.  They have already decided exactly which communities they want to be in, what their exact price range is and what their offer parameters are.  This puts them in a much better position than a Jacksonville foreclosure buyer without goals and knowledge of the market.  When the Jacksonville foreclosure comes up that matches they are ready to put in an offer right away.

6)  The Jacksonville Real Estate Market may continue to go down.  Did a Jacksonville real estate agent really just say that?  Yes, yes I did.  We believe in complete honesty.  The truth is that when you buy, know your goals.  Do you plan on living in the home, or keeping it, for five years, ten years or more?  Are you planning to sell it after a year or so?  You have to be prepared to see home prices continue to drop even after you are sitting in your new home.  Does that mean you shouldn't buy now?  Absolutely not.  Prices are lower than they have been in years and interest rates are great.  This is a good combination.  It just means that you need to be realistic and understand that this is a very big possibility.  Make sure your short and long term goals line up with what we are likely to see.  It may be the best time ever for you to buy or it may be a horrible idea depending on your personal situation and your future plans.

It is very common for Jacksonville condo prices to have dropped 50% since 2006/2007.  Surprisingly, I am seeing some condos in the Southside area of Jacksonville, St Johns County and Clay County priced around 25% of what they last sold for just a few short years ago!

Here are a few of the factors wreaking havoc on our Jacksonville condo values in the Jacksonville Real Estate Market:

Jacksonville foreclosures in condo complexes.  Once Jacksonville foreclosures have entered a condo complex...expect values to start plummeting.  Rather than pricing the condo at market value...we see many new Jacksonville condo foreclosures come on for a good deal less than fair market value.

Hardship situations making it hard, or impossible, for some (many???) residents to pay their condo dues.  When this happens, rather than dramatically slashing expenses to make it easier for the remaining residents, it seems that they are simply dividing the expenses by the number of people who are paying their dues still.  This in turn forces more people to not be able to pay their dues.  We think everyone would benefit by cutting condo dues, rather than raising them which will continue to add to hardship situations.  If you are buying a Jacksonville condo...remember one thing.  Go ahead and plan and budget for the dues to go up!!!  These condo fees are not set in stone, and we are of the opinion that we are nowhere near the point where they will level off.  We also question whether they will ever voluntarily bring these dues back down even after the housing situation and the economy improves to the point where we are no longer seeing defaults above the historic average. 

With 42% of 2009 Jacksonville real estate closings of non-condo properties being distressed property sales (Jacksonville short sales and Jacksonville foreclosures), buying real estate today can be much harder than it sounds. 

• Do you know how to get a good deal in the Jacksonville Real estate market? 
• How do you define good deal in the Jacksonville Real Estate market? 
• Are you willing to wait for a Jacksonville short sale? 
• Are you willing to pay asking or higher for a Jacksonville foreclosure?
• Do you have what it takes to get a loan?  How little or much will you have to put down?
• Will today's deal be tomorrow's overpriced purchase?

A couple years ago it was much easier to purchase Jacksonville real estate.  The year 2007 saw only 6% of all sales falling into the Jacksonville short sale or Jacksonville foreclosure category.  The year 2008 ended with this number creeping up to 21% of all sales.  The year 2009 was when the balance changed in the Jacksonville real estate market.

We are in a unprecedented (and unpredictable) real estate market.  No one ever predicted that the amount of Jacksonville real estate closings that are short sales and foreclosures would at some point catch up with straight resale closings.  But they have.

If you listen to the statistics, you will often hear that 2009 sales surpassed 2008 sales.  THIS IS TRUE.  What you do not commonly hear is WHY this has happened. 

Prices in the Jacksonville real estate market have plummeted in the past couple of years.  In 2009 we saw far more distressed property sales.  This ushered in a new era of low prices in the real estate market. Jacksonville foreclosure sales are leading to the crumbling home values in the Jacksonville real estate market.  Because the prices have moved to new lows, we have seen an increase in sales over the past year.

Bad if you are a seller.  Good if you are a buyer.  Probably good if you are a move-up buyer.  Terrible if you are a move-down buyer.

If you are a buyer the first question you should decide is whether you are willing to wait on lienholder approval for a short sale.  If you are, depending on the bank you could wait 2, 4, 6 months or longer to find out if your deal is going to be blessed by the bank.

If your answer is no...you should pay particular attention to the resales you see.  Will your offer amount create a short sale situation?  Does the seller have the ability to bring cash to the table?  Are they willing?

Found the perfect foreclosure?  From what we have seen foreclosures are usually priced a good amount below fair market value.  Most of the time buyers should be prepared to pay full listing price (remember this amount is usually below fair market value) or more to get the property.

Before you put in your offer, you need to understand what the comparable sales say the home is worth.

You also need to be pre-qualified with a COMPETENT lender.  Good lenders are worth their weight in gold, do you know how to find a good one?

Now, more than ever, Jacksonville homebuyers need great real estate professionals to help them navigate the stormy waters.  This is even more true when purchasing a foreclosure or short sale property or one that could become a short sale. 

I know these seem like silly questions, right?

Well they are not, because we witness human behavior mixed with real estate every day.  We are big at watching the stats and dealing with the reality of the Jacksonville Real Estate market, no matter what that reality may be.  We can not change the current Jacksonville real estate market by spinning it into a story that would be prettier to tell or a story that will massage someone's feelings.  We decided a while ago, despite an industry push to always spin pretty, to always tell the truth whether it makes the prospective buyer or seller feel good or not. 

When we talk to a seller, we do not tell the seller what they want to hear unless it coincides with reality.  If we lie to make a seller feel good, who are we helping?  If we tell you that your home is worth $300,000 when the reality is that the comparable sales indicate it is only worth $250,000...are we helping you?  What can you anticipate happening in that type of situation?  Do you think you will sell your home in this market for $300,000 when the other sales show that $250,000 is what it is worth?  Then why would you try?  Yet some sellers will chose the agent that says they can sell it for $300,000 (and there will always be somebody who will)  when there are no sales even close to that price in recent history. 

If you don't have to sell your home right now, then you should not.  That is the truth.  That being said, we can not predict when it might get better for sellers.  We would like to think that the market is going to turn around dramatically next week...but we would not be honest if we made you any type of promise that this is the case.

If you have to sell your home, please be sure you chose a great, honest agent to do the job.  Otherwise, the job may never be done and you may end up in worse circumstances than you are in right now.

Buyers--do not buy a home anticipating instant appreciation.  There are no guarantees.  A bargain today could be grossly overpaid for tomorrow.  Or it may not.  Buy your home to live in, and make sure it is something you can afford. Ignore industry reports.  Be realistic.  No one can predict the real estate market.  Don't listen to some one who tells you they can.  Demand comps before you put in an offer.  Educate yourself and make your decisions for the right reasons.

Percentage of sales breakdown between Distressed Properties and Straight Resales

• Over 41% of the sales closed in Jacksonville were distressed properties.  This includes both Jacksonville short sales and Jacksonville foreclosures.
• 47% of the sales closed in Jacksonville in September were straight resale.  (non- distressed properties also not listed as new construction)

Pending-to-Active Ratios for Jacksonville Real Estate Sales

• Pending-to-active ratio for September was 32.3%
• Pending-to-active ratio for distressed properties was a whopping 72.7% although they only accounted for 25.8% of all homes actively for sale in the MLS.
  
• Pending-to-active ratio for straight resale properties was only 14.8% although they account for 64.9% of all active home listings.

As of September 30th the inventory level in the Jacksonville market overall was 10.04 months based on the past 12 months of sales.  Based on the past 30 days of sales, this number was 8.8 months.  Keep in mind the tax credit that is set to expire the end of next month is fueling some sales and might account for the uncharacteristic increase of September sales over August sales and the bump in the related ratios.  (Although September exceeded August last year as well, looking back to data beginning with 1993 August sales exceed September.)

Here is the historical chart of Jacksonville real estate sales (blue line) I created from the data dating back to 12/31/02 through 9/30/09.  I also added a line for straight resales(green line) and distressed property sales (red line) which include Jacksonville foreclosures and short sales...which just recently entered the scene.  You can click on the graph to see the larger version.  Straight resales and distressed sales traded top position for the first time in January of this year.  Since then the sales in each category have been charting relatively close together.  The pursuit of the tax credit has taken the short sale option off of the table, for buyers who hope to qualify, in recent months. 

The number that really caught my eye was the home sales pending.  Based on the MLS it appears that there are 2,898 sales pending.  This is at its highest level since JUNE 2006.  This reflects a 32% pending to active ratio...still in buyer market territory.  The outstanding news is this is DOUBLE what it was last year at this time.

Here is the reality of that number...notice above where I said that "based on the MLS it appears"...many of those will not close.  Pending home sales used to translate a lot closer to actual closings than they do now.  Why is that?  There are several factors that are contributing to a higher than normal number of fall-outs in the Jacksonville real estate market.  Here is just a sample of some of the reasons involved:

• The higher incidence of Jacksonville short sales.  While we love doing Jacksonville short sales, there are a myriad of reasons I could give here in explanation of this.  Just a couple of examples are short sales being attempted incorrectly, sellers not being properly pre-qualified, short sale pricing not being justifiable, and the sluggishness of banks.
• Appraisals are killing transactions.  Appraisers are scared and are appraising much lower than in previous times.  (Did you know banks are starting to sue appraisers for old appraisals?)  Some of the appraised values are downright laughable!
• Buyers and Buyer Agents who are making offers or getting into contracts on multiple short sale properties.  (Nope, I'm not kidding about this...)
• Banks/Lenders who are being much more stringent in underwriting loans.  A prequal doesn't necessarily translate into a loan. 
• Sometimes banks really can't sell foreclosures that are under contract yet.  Ever heard of re-foreclosure?  Neither had we until recently.  

Jacksonville distressed property sales.  (Yes I used that as a complete sentence.)  That's the big news in Jacksonville real estate although it's a topic many in the industry would prefer to avoid.

In the past 30 days..

• 32% of all non-condo home sales in the Jacksonville market have been foreclosures.  Foreclosures drive down market prices because they are usually put on the market at a price that is a good percentage below fair market value.
• 13% of all property sales have been Jacksonville short sales.
• 45% of all non-condo home sales in the Jacksonville real estate market have been distressed property sales.  This number includes both Jacksonville short sales and Jacksonville foreclosures.
• 45% of sales have been straight resale properties.  This represents the sales that took place where either the seller had enough equity to sale, or had money to bring to the table to make up the deficiency.

There has been a slight increase in the number of homes sold this year vs. last year at this time.  This being said, prices have dropped quite a bit and homeowners have continued to see their values erode.  Last year at this time only 30% of all sales in the past 30 days were distressed property sales vs. 45% this year. 

By the time we got the second and third call we knew something was wrong.  The third caller argued with us that we had listed the house for rent for $800/month on Craig's List.  We went in and found the ad.  It didn't mention our names or number, but they did use the copyrighted pictures we had taken of the home.  We called the owner and asked if they had advertised the house for rent for $800.  The husband said there was no way they would do that, but he would confirm with his wife.

The scary thing is that the person obviously looked at the tax record and set up an e-mail address that was very close to the name of the owner.  So we responded to the ad at the provided e-mail address.  Here is the response  we got:

011-234-702-907-5558"

We went back on and looked this morning to see if the ad has been reposted.  It hasn't, but we found a different one that is posted both in St. Augustine and in the DC Metro area with the same pictures and same e-mail address (although not the address used for our listing). 

We think Craig's List is a wonderful tool for consumers and we do put our listings on there (and will continue to).  But be careful out there with online ads and do your homework!  And remember, if it sounds too good to be true...it PROBABLY is!

To put things in perspective, in the past 30 days, only 874 homes (non-condo) have sold in the whole metro area (including Duval, St Johns and Clay county).

Far from being at a standstill, we need to curb the number of Jacksonville foreclosures to see any marked improvement in the real estate market.

Jacksonville area homes that are priced well are selling, but we are not seeing an improvement in the sales prices, nor should we expect to until the number of foreclosures go down. 

When homes are priced well relative to their competition we are used to seeing multiple offers.  For example, we had three offers within a couple of weeks on our last short sale we listed in Bartram Springs.  On another one of our oceanfront short sales we have under contract, we have several buyers waiting, hoping things fall out. 

The buyers who are out there are hungry for bargains in the Jacksonville real estate market.  Unfortunately for sellers, many times it is only the short sales and foreclosures that meet that criterion.

HOAs serve a good purpose.  They keep the neighborhood (at least in theory) looking nice.

As a resident of a HOA, I'd rather see them cut their budget than further squeeze Jacksonville homeowners who are already strapped.

We got a notice in the mail from our HOA this week that knocked my socks off.

Our HOA dues have gone up 19% in the past two years (now at $158/month)...but now they want to impose a "special assessment" on the current homeowners for $200 per lot because of their own budget deficits.  They are having a special meeting so the board can vote to implement this.  And make no mistake...HOAs are not a democracy.

I'm just concerned that these types of decisions by area HOAs are just going to exacerbate the problem making it harder and harder for many homeowners to make ends meet. 

In addition, they are imposing what I lovingly refer to as a "short driveway tax."  From now on, cars parked in the street overnight (between 12 am and 5 am) will cost you "up to $1,000".  That's not about the few cars that are sometimes left in the street when overnight company is in town...that too is about the budget deficit.

Sorry friends...if I have you over...you have to pull out of the driveway no later than 11:59 pm! 

Sorry grandma and Aunt Beth...I happen to have a very short driveway because of where the house had to be put to save a few trees.  No more visits for you unless you park on my front lawn....wait a minute...that HAS to be some type of HOA violation...

There is an extreme amount of pressure on the appraisal industry.  There has been an attack on appraisers by the banking industry...the industry they serve. 

New rules implemented earlier this year (HVCC) have made it much harder to make a living as an appraiser.  There has been a push towards using AMCs (Appraisal Management Companies) to order appraisals.  AMCs don't seem to be worried about quality...they hire the appraisers who will work for cheap. (Many AMCs are reportedly owned by banks ie Bank of America and Landsafe) Appraisers who used to make several hundred dollars for an appraisal, money well earned, have found their fees roughly cut in half by these middle man companies who now pocket the rest.

As a result, appraisers now have to work on volume to survive.  When you have to do twice as many appraisals to make the same amount of money...what happens to quality?  In addition, many appraisers have to work larger areas to survive.  This is, many times, leading to out-of-area appraisers who are not familiar with a particular market, being hired to appraise a property.

As if this were not enough...appraisers are now being hit with lawsuits by banks for appraisals they did years ago (that they likely made less than $400 on to start with!!!).  Banks who are looking to pass the responsibility on to someone else. 

We have now seen two Jacksonville real estate appraisals in a row come in at 20% or more below our contract price.

This has happened not on straight resales, but on Jacksonville short sale properties, priced low to start with, that had already been approved by the seller's banks.

If the appraisal problems can not be worked through, these are Jacksonville homeowners who will end up with a foreclosure unnecessarily.  And all because of eye-popping low appraisals that are not accurate. 

The big losers in this are the seller (who may end up in foreclosure), the buyer (who is getting a great property for a good price), the Condo or HOA Association (who we are getting a full payoff for in the deal), the neighbors in the Condo/HOA(who will see their own value go down dramatically further overnight), the seller's lienholder (who will be misled into thinking the property is worth less than it really is and suffer a larger loss than necessary) and the whole community (since this will likely be used later as a comp for another sale).

Who is the winner here?

I know of people with perfect credit scores that have had their loans modified.  Sometimes because the lender WANTED to so they could package the loan and sell it.

They did exactly what they needed to do.  They got prequalified for a loan before starting their search.  We started sending them listings that met their criteria in the Jacksonville real estate market.  Unfortunately, everything we looked at with them simply would not have passed inspection by an FHA appraiser.  They did not have a lot of cash, so a FHA loan was their only way into a home.

When you are purchasing with a FHA loan, it is a little bit more complicated than with other types.  First, the utilities must be turned on.  This is because the appraiser has to verify that everything is working.  If the A/C unit is missing, you have a problem.  If the water pressure is low, you have a problem.  If the electrical wiring is messed up, you have a problem...and on and on.  With other types of loans these things would probably be okay, but not when you are financing your Jacksonville real estate purchase using an FHA loan.

As we went through the Jacksonville foreclosure and short sale homes with these nice buyers, we had to alert them when there were obvious issues that would cause problems with their appraisal and ultimately their financing.  Unfortunately, this applied to almost every home they looked at.  We could observe the initial disappointment start to fade into disbelief.  But we had no choice but to continue to be honest.

They called later in the week and said that they were going to switch to someone else.  We really hoped they would get into a nice home that meets their needs.  We still want only the best for them, even though we won't be helping them anymore.  Hopefully they have selected a new agent who will also be honest about the situation.  It is terrible for a buyer to develop an emotional attachment to a house, and feel the excitement and anticipation, only to lose it later due to the inability to finance.  We really do wish them great success! 

Be aware of this when you are looking at homes if you are financing through FHA.  We had a problem just this week with a purchase on a Jacksonville short sale because when the appraiser went out, the water pressure was very low.  Turns out that the valve had been shut off, but it held up the appraisal, and the loan, until the issue was cleared up. 

Way overpriced -  You get no showings.

Overpriced- You get a few showings here or there, but no real interest due to the market's rejection of the price. You usually do not get an offer because the buyer decides to make an offer on an option that is either the same or better. They tend to make offers on the homes that are already priced competitively. Most buyers are unwilling to make an offer, even lowball, when the perceived value is more than a little less than the asking price.

Priced at Market- You know when you are at this point because showings pick up. You may or may not get an offer when you are priced at market. Sometimes a home can be priced right as indicated by the showings, but still is not the "best" value in the buyer’s mind. They choose something else because although the price was reasonable enough to get them in the door, it was higher than other options that they deem to be more desirable.

Priced below market- You get increased showings and usually get an offer.

Way below market- You usually get a lot of showings and multiple offers, sometimes creating an auction effect and driving the eventual sales price higher. Sometimes the final sales price is quite a bit higher.

Pricing correctly is critical if you want to sell your Jacksonville real estate.  You can't get more for your house just because you think you can.  It does not do you any good to list your house at a price that is out of the ballpark.  If you price it correctly, it will save a lot of time and stress.  Selling a house is stressful enough without overpricing it.

Around 56% of the pending contracts in the Jacksonville Real Estate market are on distressed properties.  Straight resales account for only 31% of the pending contracts. 

The simple reason is price.  Most sellers who purchased their home in the past several years can not compete with the short sales and foreclosures on price.  This leaves them forced to become a Jacksonville short sale themselves if they are in a situation in which they have to sell their home.

In a short sale the seller owes more than their home is worth.  We get a contract on the property for what the home is worth now that is subject to the lienholder's approval.  That gets submitted to the lender who evaluates the complete situation and decides whether to release the lien and allow the sale to take place.  If the lender agrees, the closing takes place and the seller no longer owns the home.  Depending on the lender, the circumstances and the type of loan they may do a lien release only or possibly forgive the remainder of the debt.  

The pending-to-active ratio for the Jacksonville area real estate market is continuing to rise and is currently at 28% which indicates a buyer's market.  This is the highest level we've seen since the summer of 2006. 

The pending-to-active ratio for Jacksonville distressed properties (these are properties that are Jacksonville short sales or Jacksonville foreclosures) is 64% which indicates a shift to a weak sellers market for Jacksonville Florida distressed property listings.  We are seeing multiple offers many times for these distressed properties.

Analyzing the numbers, some areas are much healthier than others.  The Beaches area (includes Jacksonville Beach, Neptune Beach and Atlantic Beach), Ponte Vedra Beach and the whole Northeast St Johns County area are still unbelievably strong buyers markets.  This is the inventory levels for these areas:

• Ponte Vedra Beach has almost 27 months inventory
• The Beaches (Jacksonville Beach, Neptune Beach and Atlantic Beach) have 17 months inventory. 
• Northeast St Johns County has 16 months of inventory.

A few of the healthier areas for Jacksonville Real Estate are:

• Southside only has  9.84 months of real estate inventory.
• Mandarin only has around 9 months of real estate inventory.
• Northwest St Johns County only has around 10 months of inventory.

From a buyer's standpoint, it doesn't pay to mess around.  See that home priced at $300,000 that is already a great buy based on everything else you've looked at?  Don't offer $250,000 on it if you want to make sure you get it. 

Smart listing agents know how to price a home correctly to get it sold.  When the Jacksonville home is already priced really well, you risk losing it if you decide you are going to offer a lot less.  When you structure your offer, structure it off of what the comps show and what the home is worth in today's Jacksonville real estate market.  Don't try to structure your offer based on a certain percentage off of asking price.  This is a losing strategy.

Case in point.  Last week we had an offer come in that was silly.  The house was already bargain priced, but the buyer wanted to get an additional 15% off of an already below market price.  Our sellers rejected the offer.  The same day we got in another offer that was much higher.  The offer was accepted.  A few days later the first buyer came back and offered much higher, this is a deal that would have worked had it been offered in the first place.  But it was already too late.  By wanting to push the envelope the buyer lost out on a home that they apparently really liked since they were willing to come back with a much higher offer.

We've seen this happen several times lately, don't let it happen to you.  Make educated offers in the Jacksonville real estate market.  Understand the comps and understand what the home is worth before making an offer.  Don't make an offer without looking at the comps. 

We want all of our buyers to get great deals.  There are times in the current Jacksonville real estate market where this means offering 70% of the asking price...there are other times that this means rushing in with a full price offer before the next guy does.

• Northwest St Johns County homes on the market (all ages, all bedrooms/baths)  at $100,000 or below- 11

• Northwest St Johns County homes under contract priced at $100,000 or below- 13

• Northwest St Johns County homes sold in the past month priced $100,000 or below- 12

What does this mean?  We are looking at less than a 1 month inventory for homes in Northwest St. Johns County that are priced at $100,000 or below.  If you are a first time home buyer interested in this price range, you'd better hurry.  We have no way of knowing if this under-$100,000 supply will be replenished or if prices will start to climb above that mark.

There may be bond money for you to help you with your purchase, let us know if you are interested in trying to grab one of these homes.

Why is this?  Because Jacksonville short sales and Jacksonville foreclosures price their homes correctly and at current market value.  They do not hang on to what their neighbors sold for two years ago or even what the house next door is priced at when their upgrades are better.  Jacksonville foreclosures, and correctly priced Jacksonville short sales, are priced in an objective manner based on comparables and making the home the most attractive home to potential buyers.

Last month we put a new listing on the market.  We explained to the seller the current conditions of the Jacksonville Real Estate market.  The motivated seller listened and chose to price his home to be the next one to sell in the community.  Within two weeks we had him under contract with a fully qualified buyer and we will be closing in a week and a half.

This seller was exceptionally smart.  He recognized the fact that by pricing his home to be the next home to sell, he was taking advantage of today's market instead of sitting by and watching his competitors sell (or not sell, as the case may be).  This savvy seller realized that by pricing his home correctly TODAY he would not be chasing the market down but would avoid future price decreases that have been coming rapidly in the past 3-6 months in the area.

By pricing his home correctly from the beginning, he saved himself a lot of money.  He didn't look at what he bought it for less than two years ago, or get emotionally attached to what it "used to be worth."  He simply accepted today's market and got his home sold.

In contrast, we listed a property for another seller six months ago.  Great couple.  Very nice, but unfortunately emotionally attached.  They began their listing priced in the correct range, but would not price their home to be the next one to sell, no matter what the statistics said.  We were able to bring the sellers three offers over the next couple of months.  We were able to negotiate one particular offer up to a price where the seller could have gotten out from under their less than two year old purchase with several thousand dollars.  This has been practically IMPOSSIBLE in this real estate market.  We excitedly brought them the offer amazed that we were able to get them such a good deal.  They rejected it.  They lost the buyer. 

Unfortunately, this was the last offer this nice couple received.  We went back to them over and over for price reductions based on the drops in the market value, which they refused because they felt like they could get more.  When it was time to renew their listing, we had to explain to them that for us to be able to keep it listed, we would have to reduce the price dramatically to get in line with the market, and the other homes in the community, or we simply could not sell it.  The price we had to recommend at that point was 10s of thousands less than the offer we had brought them months earlier which would have netted them several thousand dollars.  The sellers failed to take our advice and as a result will not be able to sell their home now without selling it short or bringing 10s of thousands to the table.  They missed their window of opportunity by failing to get ahead of the market.

If you are considering selling your Jacksonville home, please understand that you have to price your home ahead of the market.  If you don't have to sell, you should consider waiting.  If you have to sell and fear that you do not have enough equity, talk to a qualified Jacksonville short sale specialist.  Do not just talk to a general real estate practitioner.  Successfully listing and selling short sales requires a special level of training and expertise.  Call us at 904.371.9654 if you need help.  We are Jacksonville short sale specialists and we can give you an honest evaluation of what your home is worth.

 

	2/28/2009	1/31/2009	2/29/2008
Jacksonville active real estate listings	10,532	10,565	11,677
Jacksonville homes under contract	1,927	1,687	1,576
Homes sold during month (Jax Metro non-condo)	599	525	678
Inventory based on past month	17.58	20.12	17.22
Inventory based on past year	13.01	12.94	11.66
Pending-to-active ratio overall market	18.30%	15.97%	13.50%
Pending-to-active ratio distressed property	38.54%	32.95%	N/A
Distress Sales as Percentage of Total Jacksonville Real Estate Sales for past year	25.50%	23.64%	7.16%
Distress Sales as Percentage of Total Jacksonville Real Estate Sales for past month	43.41%	44.95%	14.45%

We have a 13 month inventory level in the Jacksonville real estate market currently based on the past year's sales.  We have a 19 month inventory level in Jacksonville if you base it on closed sales in the past month.  It is a very bad idea for a Jacksonville home seller to be anything less than completely accommodating.  There are plenty of other homes to see besides yours, and if you make it difficult, they will elect not to see yours.

Be flexible with timeframes.  If the agent has requested a showing between 10 and 12, don't insist on a one hour window.  Don't insist on a 30 minute window.  Don't insist that they move it to 11-1.  Just smile, say okay, and start cleaning!  When the agent is working with serious buyers...many times they are showing quite a few homes, and have arranged them into a common sense order, and can not be bothered with requests to shift and rearrange the appointments for a homeowner.  They will probably just skip your home.

Another bad idea is to have the agent, or homeowner, meet the buyer and agent at the home to provide access.  Buyers do not want to have to entertain an agent or homeowner when they simply want to see if the home may be right for them.  Buyers do not want someone to try to sell them the home.  Buyers can differentiate between the master bedroom and the kitchen.  Buyers even know which features are upgrades.  Buyers usually know within the first three to five minutes of entering the home whether it is something they are interested in.  They usually decide they are not interested if they feel like they can not freely look at the home because of interference.

Interestingly enough, we usually find the areas with the highest inventories are the hardest to schedule appointments in.  Jacksonville Beach, for instance, has roughly a 20 month inventory (almost 2 years!!!) based on both the past year's sales and sales for the past 30 days.  Yet, we find that a lot of homes there are difficult to show or come with a lot of requests (narrow that window, call the listing agent 30 minutes before so they can meet you, etc.).  At the same time, Southside and Mandarin have two of the lowest inventory levels in the area, both around 10 months based on the past year's sales and 15 months based on the past 30 days sales, but these are the easiest homes to show.  Perhaps there is a lesson to be learned.

If you are selling your home in this market, you have to be serious about the task.  This includes making your home easily accessible and pricing it right.  Do not hire someone because they tell you want you want to hear.  Hire someone who is not afraid to tell you the truth if you want to be successful in selling your home.

The overall Jacksonville Florida real estate market has an inventory level of 12.87 months based on the past year.  Based on the past 30 days of sales this level is currently at 18.73, down from 22 months just one month ago.  This is an indicator that Jacksonville real estate market activity is picking up.  We have seen the pending to active ratio go from around 14.5% a month ago to today's 18.73%, a healthy jump in current activity.  This demonstrates that buyer are putting down contracts at a higher rate than they were.  Although it's still a strong buyers market, it's moving closer to healthy territory than we have seen it in a long time.

The most balanced sub-market we see today is in the Southside Jacksonville area.  Southside has an inventory level of just over 10 months based on the past year and 14.81 months based on the past 30 days sales.  This is down from Southside Jacksonville's real estate market inventory that, just a month ago, was at 10.74 based on the past year and 21.76 months based on the past 30 days.  This change in the 30 day inventory level represents a significant increase in home buying for this area.  The active to pending ratios we see for Southside Jacksonville is up roughly 2% from a month ago for the overall Southside Jacksonville Real Estate Market.  For distressed properties (Short Sales and Foreclosures) in the Southside Jacksonville Real Estate Market the pending to active ratio is up 5% from just a month ago.  These numbers indicate more buyers are putting down contracts.

The sub-markets where buyers have the biggest advantage today is out at the beaches.  Jacksonville Beach, Neptune Beach, Atlantic Beach and Ponte Vedra Beach are all demonstrating a real estate market that is highly weighted towards the buyers. 

The Ponte Vedra Beach real estate market has seen the pending to active ratio go up in the past month from a low of 5.76% to 9.38%.  An interesting note is that the pending to active ratio for Ponte Vedra Beach distressed properties has increased from 20.93% a month ago to a balanced 56.41% pending to active ratio.  This indicates that although Ponte Vedra Beach has a very weak real estate market currently overall, in the area of Ponte Vedra Beach short sales and Ponte Vedra Beach foreclosures, it is now a balanced market, with no advantage to buyers!  Buyers are apparently hungry for bargains in Ponte Vedra Beach.  Remember, this is indicative of buyers getting off the fence and entering into contracts with sellers...we can not predict how many of these will go to closing.  Inventory levels in Ponte Vedra Beach have remained steady for the past month based on the past year's sales.  The inventory levels based on the past 30 days sales have gone down from 47 months to today's inventory level of 35.53 months.  This indicates a pickup in the pace of Ponte Vedra Beach real estate sales.

For the Jacksonville Beach, Neptune Beach and Atlantic Beach sub-market, numbers have remained very steady in comparison today compared to a month ago.  The pending to active ratio has gone up a little over 1% in the past month.  The beaches inventory level based on sales for the past 12 months has remained almost completely unchanged.  The inventory level based on sales for the past 30 days has dropped only 2 months of inventory since last month this time.  This is an indicator that the Jacksonville Beach, Neptune Beach and Atlantic Beach real estate markets do not seem to be picking up as fast as some of our other sub-markets and the Jacksonville real estate market overall.

We will continue to follow this for you and let you know the conditions of the Jacksonville real estate market as they develop.  For expert, reliable help from a team of real estate professionals who really understand the Jacksonville real estate market call us!

• Active Listings in the Jacksonville Real Estate Market (non-condo)today- 10,465
• Active Listings in the Jacksonville Real Estate Market, one year ago- 11,780
• Pending Listings in the Jacksonville Real Estate Market (non-condo) today- 1,906
• Pending Listings in the Jacksonville Real Estate Market, one year ago - 1,550
• Percentage of active listings that are distressed properties - 24.96%
• Percentage of active Jacksonville real estate listings that are straight resales - 64.03%

Jacksonville Real Estate Market Inventory Levels

• Months of Inventory in Jacksonville Real Estate Market today Based on sales for the past year - 12.89
• Months of Inventory in Jacksonville real estate market, one year ago,  based on sales for prior year - 11.72
• Months of Inventory in Jacksonville Real Estate Market today Based on sales for the past 30 days -  19.90
• Months of Inventory in Jacksonville Real Estate Market, one year ago,  Based on sales for the prior 30 days  - 20.38

Jacksonville Active-to-Pending Ratios

• Active-to-Pending Ratio for overall Jacksonville Real Estate Market today- 18.21%
• Active-to-Pending Ratio for overall Jacksonville Real Estate Market, one year ago - 13.16%
• Active-to-Pending Ratio for straight resales in the Jacksonville Real Estate Market - 9.18%
• Active-to-Pending Ratio for Distressed Properties (Jacksonville Short Sales and Jacksonville Foreclosures) - 37.14%

Jacksonville Real Estate Market Sales Breakdown

• Percentage of Jacksonville Real Estate Sales past 30 days that were distressed properties - 45.25%
• Percentage of Jacksonville Real Estate Pendings that are distressed properties - 50.89%
• Percentage of Jacksonville Real Estate Sales past 30 days that were straight resales - 42.21%
• Percentage of Jacksonville Real Estate Pendings that are straight resales - 9.18%

Summary of Jacksonville Real Estate Market Conditions

Our inventory levels are heading in the right direction.  Our inventory levels based on Jacksonville real estate sales for the past twelve months seems to be headed down.  At the same time the Jacksonville real estate inventory level based on the past 30 days of sales has gone down as well.  Remember, this is the one that is more of a "rapid indicator" of the current market as this number will move faster than the inventory based on the past year as the market picks up.  Total listings are down and pendings are up.  While only a quarter of the active Jacksonville real estate listings are distressed properties, over half of all homes under contract in the Jacksonville Real Estate market are Jacksonville short sales or Jacksonville foreclosures.  There are more Jacksonville distressed properties going to closing right now than straight resales.  That is, in general, because the pricing is better and that's what Jacksonville home buyers care about right now...PRICE!

Our pending to active ratio is an encouraging 18.21%.  Though it is not in the 50% territory, which would indicate a healthy balance between buyer and seller, it is up more than 5% from last year this time.  Our real estate market is healthier now than it was last year and seems to be moving towards balance.  The active to pending ratio on distressed properties is almost 40%!  This is a fabulous number.  This indicates that the Jacksonville distressed property market which includes Jacksonville short sales and Jacksonville foreclosures is moving rapidly towards balance!  As the active to pending ratio travels up, it will be harder and harder for the buyers to get an exceptional deal.

• Active Listings in the Jacksonville Real Estate Market (non-condo)today- 10,577
• Active Listings in the Jacksonville Real Estate Market, one year ago- 11,615

• Pending Listings in the Jacksonville Real Estate Market (non-condo) today- 1,762
• Pending Listings in the Jacksonville Real Estate Market, one year ago - 1,437

• Percentage of active listings that are distressed properties - 25.28%
• Percentage of active Jacksonville real estate listings that are straight resales - 63.29%

Jacksonville Real Estate Market Inventory Levels

• Months of Inventory in Jacksonville Real Estate Market today Based on sales for the past year - 13.05 Months
• Months of Inventory in Jacksonville real estate market, one year ago,  based on sales for prior year - 11.28 Months
• Months of Inventory in Jacksonville Real Estate Market today Based on sales for the past 30 days - 20.9 Months
• Months of Inventory in Jacksonville Real Estate Market, one year ago,  Based on sales for the prior 30 days,  - 19.17

Jacksonville Active-to-Pending Ratios

• Active-to-Pending Ratio for overall Jacksonville Real Estate Market today- 16.66%
• Active-to-Pending Ratio for overall Jacksonville Real Estate Market, one year ago - 12.37%
• Active-to-Pending Ratio for straight resales in the Jacksonville Real Estate Market - 8.44%
• Active-to-Pending Ratio for Distressed Properties (Jacksonville Short Sales and Jacksonville Foreclosures) - 33.92%

Jacksonville Real Estate Market Sales Breakdown

• Percentage of Jacksonville Real Estate Sales past 30 days that were distressed properties - 45.71%
• Percentage of Jacksonville Real Estate Pendings that are distressed properties - 51.48%
• Percentage of Jacksonville Real Estate Sales past 30 days that were straight resales - 42.51%
• Percentage of Jacksonville Real Estate Pendings that are straight resales - 32.07%
• One Year Ago:
  •  Percentage of Jacksonville Real Estate Sales in the prior 30 days that were distressed properties - 17.49%
  • Percentage of Jacksonville Real Estate Sales in the prior 30 days that were straight resales - 63.7%

  A couple of the new trends I see are very positive.  First, the number of listings are down.   So it appears that sellers who don't have to sell may be starting to realize they need to wait this cycle out. 

Another very positive trend is that the active-to-pending ratio is up to the highest level we've seen in a while and up more than 4% over last year at this time and is getting close to the 18.88% it was during the same week two years ago when the Jacksonville real estate market significantly healthier, although it was in a downswing.  This also indicates current action.

The number of pendings are up from last year.   This indicates that more buyers are starting to take action.  On a very positive note, our pendings are only 160 below this time in 2007.    Keep in mind, the pendings mean nothing if they don't ultimately make it to the closing table, something that can not be predicted accurately at this point.  Active and pending numbers are a snapshot in time and indicate current activity are do not translate into closed sales.  These numbers are also highly dependent on the information being put into the system correctly and the validity of the sales contracts behind the pendings. 

Months of Inventory levels are still high, but remember they are based on historical numbers.  The inventory numbers are calculated based on the past 12 months sales and past 30 days of sales, both of which have been weak which would keep the number higher.  If we see closings start to happen at a higher rate, we should see the inventory based on the past 30 days trend down much faster than the inventory based on the past 12 months.  If all of the pendings were to close in the next 30 days, the market would fall to an inventory level of only 6 months based on that 30 day period.  That is how quickly we could see the Jacksonville real estate market turn around if the different factors were to fall into place.

If you are a Jacksonville home buyer who has been trying to decide if it is the "right time" to buy...don't sit it out until it's too late.  Remember, after the seller's catch on to a shift, the dynamics will change radically.  Get a good buyer's agent and get into the game.  Let us know if we can help you!

A year ago, residents of the World Golf Village area had to drive to CR 210 for a pharmacy and drive to I-95 and International Golf for the small Publix situated there.  Many times you would have to drive to the Publix on 210 for a better selection.

With this new Publix, a CVS and Walgreens all opening over the past year at the corner of International Golf/Pacetti and SR 16 residents are ecstatic!

A good buyer's agent will get you a good deal whether there is an advertised "sale" or not.  I was just curious if this has some type of psychological effect on a buyer.  My feeling is that buyer's are smart, savvy and clearly feel that every home is on sale 365 days a year in this market.

What do you buyers out there think?

Do we get every listing because we always tell the truth?  No.  We have found that many sellers really don't want the truth, they just want someone to feed them a version of the story that they are comfortable with.  And there will always be someone there willing to do this....just not us. 

Whether you are a buyer or seller you can always depend on us to tell the truth about the Jacksonville real estate market and you can count on us to know.

Every day we hear those that say "things have really picked up" and we think that the ones saying this probably really believe it.  But the truth is that while there do seem to be more buyers looking, that seems to be all they are doing.  January 2009 sales are lower than we have ever seen. BUT WE DO NOT THINK THIS IS A BAD MARKET.  Yes, we did just say that.  You see, it's all relative. 

If you are a seller wanting to get out of your home without selling short, it is a bad real estate market.  If you are a buyer wanting to get a good deal, now is the best time we have ever seen to buy a home.  It is a phenomenal market for you!

From 2004 through 2006 we saw a buyer frenzy taking place in the Jacksonville real estate market.  This was a market that was truly incredible for sellers.  For sellers it was an awesome real estate market.  They could turn down offers because they knew that the next one would be better.  At the same time, it was not a good market for buyers.  Buyers were paying full price, and many times over full price, to secure a home.  Looking back it was a terrible real estate market for buyers.  But when the media and the industry talks about this time, it was a "great" real estate market.  But this is a generalization that can not be applied to all aspects of the market, particularly to the buyers. 

Times have changed and it has become just as much of a buyer's market as it was a seller's market back then.  So it is amazing to see how many buyers are still sitting on the sidelines not taking advantage of it when a couple of years ago you couldn't have talked them out of it.

We think that buyers are waiting for the "bottom."  The bottom seems to have more star power at this moment than Brad and Angelina.    The bottom, however, is stealthy, sneaky and will come in disguise.  You will NOT know the bottom when you see it because it will look like every other real estate day.  Here's an important tidbit for you...we don't think you'll know that the bottom has already breezed in and out without so much as a wave in your direction until six to twelve months after it's cleared out of the area.  Only history proves a bottom and it takes several months of a trend to know that the bottom was hit.  After that, we really think that it will take months to get the message out because it will not be a message of doom and gloom. If you are waiting on the bottom you will most likely miss it. 

Here is a simple example:

House A and House B are identical floor plans, same Jacksonville neighborhood, etc.

House A is priced at $400,000 and is the highest price in the neighborhood. 

House B is priced at $325,000 and is the best price in the neighborhood.

The owner of House A is willing to agree to 10% off of their $400,000 asking price while the owners of House B are standing firm at $350,000.  Which one is a better deal?

Does the fact that you got $40,000 off of the asking price make House A a better deal?  Well of course not.  However, many buyers will feel better about that house at the end of the day instead of the one that they couldn't get the sellers to reduce.  Looking at this example the error in this rationale is probably obvious to you.  But we see it happen every day.

If you are a Jacksonville real estate buyer, please understand that the percentage off of asking price you get is not indicative of a good deal.  Many homes today are fabulous deals even if you were to pay above asking price for them.  You have to somewhat "ignore" the asking price when analyzing the deal and look at the whole picture.

You need to see all of the comparable properties and analyze the situation.  You need to look at sales for the past 3 months (anything beyond that is likely to be overpriced right now due to the fourth quarter of 2008 seeing more substantial price drops).  But don't stop there.  You need to see (if not physically, on paper) every home that is comparable that is currently on the market.  This data is how you measure your deal.

Do not fall for the average percentage off of the asking price that Jacksonville real estate is selling for.  Do not take the word of someone else who tells you it is a good deal.  This is one of the largest financial decisions you will make in your life.  Ask for the facts and focus on the details that matter.  We help homebuyers every day and believe that you must be completely educated before making an offer in this market.  Let us know if we can help you!  904.371.9654.

There are 10,602 homes for sale (non-condo) in the Jacksonville real estate market this morning.  There are 1,610 homes under contract at this moment.  There have been 9,704 homes sold in the past year, and 479 sold in the past 30 days.

The pending to active ratio for the Jacksonville real estate market is 15.19%, still far from our benchmark 50% that is indicative of a balanced market.  This is the highest we've seen the ratio go since September of 2008 and a year ago at the same time this number was only 11.18%  At the same time in 2006 this ratio was at 18.20% and the Jacksonville real estate market inventory was only at 7 months.  At this point in time, as the pending to active ratio suggests we were already well into a buyers market.  At the same time, most in the area had no idea that we were in a buyer's market since the inventory still appeared to be somewhat low and could be attributed to being a seasonal drop.

We have a 13.11 month inventory in the Jacksonville market right now.  Last year at this time we had an 11 month inventory.  Today's level is down from the high of around 14 months we saw a few months ago.  The inventory level at the point the real estate market started to fall was at less than 4 months.

As more sellers who do not have to sell begin to take their homes off of the market, we should see the inventory level continue to go down. Today 64% of the homes on the market are straight resales while only 25% of the homes on the market are distressed properties.  Even though the number of straight resales almost triple the number of distressed homes on the market, only 32% of all homes that are under contract are straight resale while over 51% of all homes under contract are distressed properties.  The pending to active ratio for distressed properties is dramatically better, almost 31%,  while the pending to active ratio of straight resale properties is only 7.66%.  The straight resales that are selling are the ones who are able to price their homes competitively with the distressed properties.  Overpriced homes do not sell in this market and rarely get showings.  Buyers are rejected everything but the best priced homes.

If you are thinking about putting your home on the market, you have to price ahead of the market.  You owe it to yourself to get an upfront honest evaluation of what your home is really worth in today's market.  Do not overprice your home.  You are only going to cost yourself time and more money if prices continue to fall. 

If you are only the fence about buying, hop on off!  There are incredible values out there just waiting to be snapped up.  Just remember, if you want the best deal, look for an agent who really knows the market, is a short sale specialist, and does not shy away from distressed properties.  Call us if you need us!  904.371.9654.

The very interesting thing is that out of the 156 real estate closings, only 42% have been straight resale while over 46% have been distress sales consisting of foreclosures and short sales.

Of active listings currently on the market, 64% are straight resale while only 32% of pendings are straight resale.  As of today only 25% of actives are short sales and foreclosures but a remarkable 52% of pendings are fall into the distressed property category.  As the prices have dropped in recent months, straight resales are having a harder time competing as these numbers show.

We've seen 9,749 single family homes and townhomes (non-condo sales) sold in the past 12 months in the greater Jacksonville area.  This remains in line with what we've seen for the past 5 or 6 months.  For condo sales the number is 1,327 which has also remained fairly steady for the past half year.  We will continue to monitor this number closely as it seems we could be at or near a bottom in the number of transactions.

The Jacksonville real estate market (single family and townhomes) is sitting on a 13 month inventory level currently.  For condos we have an 18 month inventory.  In March of 2006 we were below 4 months for non-condo sales.

With interest rates at a ridiculously low level, high inventories and incredible values out there this is the best real estate market for buyers that I've ever seen.

Let us know if you would like to get started.

This statistic measures absolutely nothing in this type of real estate market.  Jacksonville distressed properties are usually priced pretty well.  Many or most straight resales aren't priced as well because the motivation, and perceived ability to price at market, is different.  So when you talk about what Jacksonville area homes are selling for in relation to asking price it really means absolutely nothing. 

Buyers should definitely not get caught up in this.  The question is, "Is the home currently a good deal or is it overpriced?"  If it is a good deal you should negotiate based on the fact that it's a good deal.  If it is overpriced, then you should negotiate based on the fact that it is overpriced.  If, in this scenario, you are just worried about some average ratio to asking price you're going to end up getting a really bad deal in your real estate transaction.

If a Jacksonville property is a great deal, well, you should probably grab it before the next savvy buyer does.  Homes that are priced well go much faster than the average and it is not unusual to receive multiple offers on good properties that are priced well.  It's silly to try to apply an average ratio, that is created  with a lot of overpriced properties in the mix, to a property that is already a bargain.

If you are a buyer understand what constitutes a good Jacksonville real estate deal and act accordingly.  Don't ever ask what the average sales price is to asking price and apply that ratio to what the home is priced at.  Ever.  The correct way is to get a complete real estate market analysis.  Find out what has sold in the past three months, what is currently pending, and know exactly what else is out there and how the home you are interested in compares.  Based on this you can determine where your offer should start.  Do not put in an offer without making sure you are educated.  You don't want to buy a home then find out it wasn't a good deal.  Make sure your agent gives you all of the information and data that allows you to make an educated decision before a decision is made.  Don't get caught up in meaningless statistics.  And don't be one of those buyers that believes you have to get a certain amount off the asking price no matter how good the price may already be.  This can cause you to miss out on the home that is perfect for you.