September Saw a Hot Market for Buyers and Sellers!

So much has changed in our world since last year— so much has changed within the Palm Beach County Real Estate Market, too. With our low inventory in PBC, the low interest rate for financing, and less and less people willing to wait on finding their dream home, the market landscape is almost antithetical to last year’s.

The time to contract and time to close is down by almost 50% and 25% respectively, showing just how decisive buyers need to be when home shopping— as options are quickly flying off the shelves! Our median sales price is up to $400,000 and average sales price is up to $656,309, as higher priced homes drive up the numbers. With such low interest rates, you might expect that most would would finance to take advantage of these historically affordable rates, but with home shopping being so competitive and cash-purchase providing a clear advantage in many cases, we’re now seeing a much higher percentage of cash closings— an almost 35% increase over the same time last year.

 

The market from $300,000 up to $999,999 is a sellers market.. So, sellers— be strategic on your pricing! Look at closed sales as a true benchmark, adjust accounting for low inventory, and place strategically, keeping your competition in mind. Buyers— this is not a market moment for “ifs” or casual looking; this is a moment for getting your ducks in a row and, upon finding the perfect home, getting that offer written and out there ASAP!

A market over $1,000,000 is a balanced market— so strategic pricing, curb appeal, and staging will be your greatest allies. There’s competition in this scenario, but not as much as there once was due to lowering inventories in Palm Beach County.

As realtors, we have an essential job to do for both our buyers and sellers in this fast moving market. In addition to readying a home for sale, we must work with our seller to determine which offer is the right contract for them. It’s not always simply a matter of price— the terms do matter. The strength of the buyer matters, and the relationship and teamwork with the buyer’s agent matter.

For our buyers, we aim to work with you to ensure you’re ready to buy when the opportunity strikes. This type of preparation tends to involve proof of funds or lender pre-approval— and not just the piece of paper that states you’re eligible for a loan, but the phase of the process that finds the lender comfortable talking to the listing agent and providing confidence in the qualifications of You, the buyer.

Representing a buyer in a multiple offer situation is always a challenge, but never an insurmountable one. It’s not simply the best or highest price that wins— it can be a matter of heart and care, too. We, as the agent team, need to demonstrate to the listing agent that we’re versed in what we’re doing and are prepared to get all of our clients to the closing table. One of the ways we accomplish this and get our buyers all the way, is by encouraging them to write a personal letter to the seller. Something to humanize the process— so that, when it comes down to decisions by the seller, it isn’t just another offer in the stack, it’s a piece of you and your story.

This month, we’ve seen a fast moving market, much competition, no shortages of offers, and homes going under contract after mere hours on the market. While this is excellent news for the economy, it can be a challenge for the individual buying or selling. So, choosing the right partner for the job is essential. We, Noreen Payne and Amy Snook of the All About Florida Homes Team of Lang Realty, are here to tackle the next step with you when you’re ready.

 

July’s Market Report!

It is a fact that there is a serious shortage of single family homes listed in Palm Beach County. In my many years in this industry I don’t recall ever seeing this strong of a seller’s market . If you will recall in months past, I shared with you that one way we evaluate a market is based upon inventory (or as some people call it consumption), further than 6-9 months of Inventory is considered a balanced market, under 6 is a Sellers Market and Over 9 is a Buyers market. When analyzing various market segments, we were amazed to see just how low the number of months of inventory actually is in Palm Beach County

Sales Price
$300 – $400,000    2 Months of Inventory   Seller’s Market
$400 – $599,000   3 Months of Inventory   Seller’s Market
$600 – $999,999   5 Months of Inventory   Seller’s Market
$1,000,000 +         7 Months of Inventory     Balanced Market

As we’ve recently shared, we started 2020 with over 19 months of inventory in the $1,000,000+ market.

To clarify, the above is specific for Palm Beach County and we should also state that we do see pockets of communities that tell a different story as some communities have stricter Covid showing requirements and certain buyer populations are not seeing homes in person due to Covid either.

What is absolutely amazing that if August results are as strong as July (which we fully expect them to be), then it is probable that we will be trending ahead of last years numbers. Low interest rates coupled with low inventory are making for the perfect storm to bring in a buyers frenzy on many homes.

July provided the highest number of new listings since before our shut down but as you can see above, we still need more inventory in our market.

Buyers are able to buy more home due to the interest rate – unfortunately (or fortunately for the sellers) the buyers you are competing for are also in the same position and currently we have more buyers than sellers.

So Seller’s; is this a good time to sell? Yes! This is the perfect time to get on market and sell your home – in fact, Palm Beach County could really use your home on the market as buyers need more options.

 

Market Report Through 3/31/2020

    While we analyze the market monthly and provide a report, this one is different and it is so essential that we all understand what is happening to the real estate market, as a result of Covid-19, so that we,together, can make educated decisions.

   There is little doubt that Covid-19 and the shut down have impacted our Palm Beach County Real Estate but in what way and what to expect I believe will surprise most consumers.    

    The first quarter results are in and as many of you know, we were trending for a great year with year over year results showing improvements from last year – and March results showed the same improvement of Closed Sales, Median and Average Sales Prices up year over year. That may surprise many people but know that closed sales in March are a result of contracts from earlier in the year – Pre-Shutdown.   March closed sales while up from February are at a much lower rate of growth from earlier in the year – so while they were closing, there were a percentage that simply did not close due to the uncertainty surrounding Covid-19, the financial impact, etc. The months of inventory over $1,000,000 is down to 13 months and if you will recall was almost 19 months just a few months ago.  Did homes sell?  Certainly but also we saw homes come off the market.     $600,000 to $999,999 is a balanced market but 300,000 to $599,000 is now a sellers’ market.    We do expect, of course, the April numbers to really reflect the effects of all that has been happening in our world.  These numbers will be out in just two weeks.

    This brings me to an important point of this 1st Quarter analysis and what to expect, in my humble opinion, moving forward.  We have clients and prospects calling and asking is now the time to buy?  Is now the time to sell?  What drives the real estate market – two major factors are interest rates and inventory.    For now the federal reserve is doing a good job keeping the interest rates low – while they are bouncing a bit – they are still very attractive for a new loan.  Inventory overall is low – regardless of the price point and what happens when inventory is low?  You will find the listing and sales prices are higher –

     We are having to get creative in how we show property, we are capitalizing on all technological opportunities for listings from the photography to the 360 virtual tours – “showing” the home without having to physically show the home to every potential interested party.  We are all operating efficiently and effectively and as a result homes are selling.  In fact to homes that we listed in the past 30 days were under contract within days of being listed and at or close to list price!   

    So while we are living in these uncertain, scary times – it is essential that our economy recover – for all of our sakes and to be able to share with you all that homes are being listed, that home are selling and that our market is start to once again move is wonderful news that I am honored to share! 

Amy

 

Utilizing Technology as Realtors in the Future! 360! Virtual Tours!

 

 

Amy speaks to friends,clients, and anyone looking for some answers as to how we can step up our game to make technology helpful and exciting. With Virtual tours and new technology anything is possible.

 

Working With Buyers In A Covid-19 Environment

Working with Buyers in a Covid-19 Environment

By: Noreen Payne

     Sitting at my desk and pondering the path forward during this time of social distancing and virtual work during Covid-19, I wonder how things will be different in our personal residential real estate business once we make it through these challenging times. But, for now, the focus is on how we continue to serve our buyers who are not only wanting to buy a home but also have to. Like many of our colleagues, we’re also looking at ways to conduct our business virtually. When it comes to our buyers, for now the days of picking them up in our cars and face-to-face interaction are on hold. Those of you who know me know I’m missing those personal moments immensely! 

That said, I’m finding that using tools such as FaceTime, Zoom, App Files, Video and Virtual tours can also go a long way toward building a solid relationship. In fact, we’ve just closed on a new home purchase with a buyer who has never set foot in the home they just bought! Though this is the first time we’re weathering a pandemic, this isn’t the first time we’ve done this. Remote contact can be a common way for buyers to purchase, especially investors who trust us with their goals.

     In the case of our recent close, we started in the classic Residential Real Estate fashion, doing what we do best. The fact-finding process, once done in person, can be handled via conference call. During the call I asked a lot of questions and did even more listening. Then I created the usual searches and shared them over email—after which came the usual back and forth feedback, mostly done via virtual tours, photos and a few FaceTime calls.

    Working in this manner with our buyer, we actually found the perfect home in no time! I set the showing with the listing agent and luckily the home is vacant and on a SUPRA, therefore, no contact/no touch deemed necessary. Over FaceTime the buyers and I took our time going through every inch of the home, down to the street on which it’s located. We negotiated the deal and went under contract. At the time of inspection, I met the inspector, who we know very well. As a side note: It’s my firm belief that having trusted partners working with you at all times is a must! I unlocked the door for the inspector and reconvened with the client over FaceTime to give them the update.  Obviously, many more things can happen prior to closing. In this case, we met General Contractors, interior designers, landscapers, plumbers, electricians, and more. It was a great help having an agent on the listing side who was incredibly accommodating and a pleasure to work with. In these days of Covid-19, our spirit of teamwork is being put to the test. Now more than ever, we’re all pulling together in the best interest of our clients to ensure smooth closings like this one. 

    In this time of uncertainty, my initial reaction was to withdraw—even marketing didn’t feel right. But, I believe these days the reality is that our clients now need our support more than ever (of course at a safe six-foot distance).

About Noreen Payne

Noreen Payne is a partner in the All About Florida Homes team of Lang Realty. She and her co-partner, Amy Snook, provide concierge-level real estate service in South Florida. She is currently Chairman of the Board for the Delray Beach Chamber of Commerce and is on the Board of Directors for The Achievement Center for Children & Families, and is an active volunteer with The Caring Kitchen.

 

 

How We Navigate Virtual Real Estate!

Amy explains how more than ever our technological tools are important in maintaining our social distance and health. The AllAboutFlorida Homes Team has all the right tools to help you list or buy your home. We know exactly how to navigate during these uncertain times and want our clients to feel comfortable knowing that we have a plan!

 

 

COVID-19 Personal Financial FAQ’s for Homebuyer’s

1. My company’s offices are closed, and I am having a hard time providing my final verification of employment within the 10 days prior to loan closing.

FHA and RHS are allowing verbal verification of employment. Specifically, your employer can provide this by phone. RHS is also allowing email verification. If you cannot get either of these, the lender will require higher reserves to cover risk. 

Fannie Mae and Freddie Mac will allow verbal verification when available and an email verification under certain conditions. They have also made other forms of temporary verification available in order to help with verification while social distancing

2.My lender indicated that the IRS has shut down and they cannot process loans without an income verification document that only the IRS can generate. Is this true?

Luckily, there is precedence for an IRS shutdown based on several recent government shutdowns. Some lenders may require this document, but Fannie Mae, Freddie Mac, and FHA do not so this is a lender overlay.

Fannie and Freddie both issued guidance in January 2019 following the previous government shutdown to note that they do not require the 4506T IRS tax transcripts at closing. Rather, they only require a request for the document be signed by the borrower. However, they do require the tax transcript be submitted as part of their post-closing review. NAR has asked both Fannie and Freddie to clarify and publish updated guidance given the unique challenges posed by COVID-19.

Furthermore, the IRS reopened this facility during the shutdown as it was deemed essential. We have reached out to the IRS on this point.

  1. I have heard that the FHA, Fannie Mae, and Freddie Mac have raised rates and fees on borrowers with lower credit scores or smaller down payments?

    These claims are not true. To date, neither the FHA nor Fannie Mae and Freddie Mac have made any changes to credit scoring or down payment requirements. The only change they have made for borrowers is to allow MORE flexibility in how a lender can verify employment.

    However, some individual lenders are adding their own, higher standards on these products. The rational is that the cost of servicing these loans has surged due to the widespread forbearance that is taxing servicers’ resources. Under forbearance, the servicer must continue to pay PITI to the investor, but the sheer volume of forbearance to deal with the COVID-19 response is unprecedented. Since lower-credit borrowers are more likely to take forbearance and servicing is harder to get, lenders are less willing to extend this credit regardless of the FHA or GSEs’ standards.

    NAR sent a letter to the Treasury, Federal Reserve, and the Federal Housing Finance Agency requesting help for servicers dealing with the unprecedented demands on funds due to broad forbearance requests. Improving servicing is one key to improving the flow of funds to borrowers and homeowners.

    Ginnie Mae has announced the creation of a new program, that should help alleviate lender concerns and improve access to mortgage financing. The program will provide cover for lenders by advancing them the money so they can make the required pass- through payments to investors during the forbearance period.

We’re here for You! Virtually!

We have so many tools available like Facetime, Virtual Video home tours, E-signatures, and many more no contact options to keep our clients comfortable and safe during this climate!

As agents and people our main goal has always been to help our community and lend a helping hand wherever possible. You can always count on us to answer the phone- we are always open to answer any questions you have, in real estate and beyond. Please do not hesitate to call, we are here to be a resource to you!

How We Can Work with Clients During this Challenging Time!

  It is hard to say what our future will look like in real estate or for that matter anything in our world, post this pandemic. While there is a lot of “bad” to focus on, I am really trying to focus on any positives that may come out of this time.   I am certain for many of us, the time at home with our children, has provided us with opportunities that we most definitely did not prioritize in the past. Realtors are constantly “on” – responding to clients, conducting searches, showing property, coordinating towards closings, educating ourselves, sharing information with our clients and prospects and so on.    So, to “have” to slow down has been actually wonderful.

I am spending time doing things with my son that I just hadn’t found the time – we played checkers, twister and even taught him how to cook (even though it is most definitely not my forte).

As for business – when I slow my mind down and really pay attention to the calls we are receiving – I realize that our clients, friends, prospects DO rely on us for real estate guidance.   I think this has always been there, but I just didn’t slow down to realize it.

Today a prospect called and asked us to list one of his homes for rent.  He had been listed as for sale by owner and hadn’t received calls – the truth is for this one, I analyzed how he was marketing the home and his price point and gave him guidance rather than taking the listing.  Why? Because his margins are very tight and I felt that I could help him without his having to pay an agent for this rental – so he reduced to the number I suggested based upon comps and I had him reorder his photos, remove some photos, alter his write up and voila – the phone started ringing. 

We are here to help – give guidance, be supportive, educate and be a resource for all.  As a thank you for helping him with his rental listing…. And unbeknownst to me…he has another property that he wants us to put up for sale.

For my fellow Realtors, be a trusted resource, offer guidance, continue your education so you can continue to be an expert.  Now is the time when you can create some blogs, record videos, etc. and work to share your knowledge.

By: Amy Snook

Fed Slashes Interest Rates Near Zero, Eases Lending Rules- Florida Realtors

“In addition to a full-percent interest rate cut, the Fed will take other stimulus steps, saying COVID-19 “weighs on economic activity and poses (economic) risks.” The move should benefit adjustable rate mortgages, credit cards and other short-term loans.”

“The Federal Reserve took emergency action Sunday and slashed its benchmark interest rate by a full percentage point to nearly zero (0% to 1/4%) and announced it would purchase more Treasury securities to encourage lending to try to offset the impact of the coronavirus outbreak. The central bank said the effects of the outbreak will weigh on economic activity in the near term and pose risks to the economic outlook. The central bank said it will keep rates at nearly zero until it feels confident the economy has weathered recent events.

The Fed also said it will purchase $500 billion of Treasury securities and $200 billion of mortgage-backed securities to smooth over market disruptions that have made it hard for banks and large investors to sell Treasuries.”

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