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Tag: Anna Maria Island real estate

Mortgage rates: How did we get here?

Written by Louise Bolger on . Posted in Business, Castles in the Sand, Real estate | Development.

On Sept. 17, when the Feds lowered the benchmark rate, I thought, about time. Although the ¼ point reduction wasn’t enough to bring buyers out of the closet, it was the Feds’ promise of two more rate reductions before the end of the year that for a fleeting moment put a smile on my face, but maybe a bit too soon.

Borrowers who have been waiting for relief from high rates might have to keep waiting. Just to be clear, mortgage rates aren’t set by the Fed, so unfortunately, don’t bet on any major drops soon. For a brief moment in time, the average rate on a standard, 30-year, fixed-rate mortgage drifted down to 6.26%. This was the lowest level in nearly a year, then a week later edged back up to 6.3%. Now we’re hearing that it’s not expected to change much going forward.

The Mortgage Bankers Association recently estimated that mortgage rates would actually increase to 6.5% by the end of the year – what? Why is this happening? While anxious homebuyers are watching the Fed, what they should be watching is the bond market and treasuries in particular.

The big boys on Wall Street are watch­ing the long-term bond yields, which have been drifting lower for several reasons. Among them is the expectation that the Fed will soon start cutting interest rates but also raise the risks of a recession. One big reason that home loan rates have been high in recent years is that banks have been buying fewer mortgage bonds. I don’t know about you, but my head just exploded.

Meanwhile the average homebuyer just wants to get their life moving again. This is what you get when half the country refinances to a 2-3% mortgage – housing gridlock.

There’s an interesting story I read in early September about the danger of having an ultra-low-rate mortgage, so here goes: Once upon a time, there lived a nice young couple with two adorable little girls close to the beach in Florida. Even though their life seemed like a fairy tale, it wasn’t, and they decided to divorce. Sad as this was, their story became sadder still when they realized they couldn’t sell their home and afford to live separately near their children. And this is where it got complicated.

This couple, like many others in the country, took advantage of rock bottom mortgage rates in 2020 at roughly 2%. This was, of course, a good financial plan at the time, however, now that they are divorced, they are experiencing the “lock-in effect.” Basically, homeowners staying in place and not moving because they don’t want to give up their low interest mortgage creates a complicated lifestyle for the couples and the children. This couple has decided to both live on the same property, he in what they call the “beach bungalow” and she in a 19-foot Airstream trailer in their yard. Both have access to both properties, and the children are traded back and forth. And other ex-spouses are also finding a way to keep their mortgage by leaving the kids living in the house with the parents rotating in and out.

With the interest rates still high and the shortage of homes pushing prices up, it looks like couples like these will have this fractured living arrangement for a while. It’s a sad state of affairs when the only reason you talk to your ex-spouse is because you have a 2% mortgage. How on Earth did we get here?

Finally, meaningful declining mortgage rates

Written by Louise Bolger on . Posted in Business, Real estate | Development.

The Federal Reserve finally graced us with a lower interest rate bone on Sept. 16 that should make everyone happy. The reason this ¼ point reduction is important is that the Federal Reserve all but promised two more rate reductions before the end of the year.

Nevertheless, there are homeowners with low-rate mortgages who are still reluctant to sell and move on as much as they may want to. A quarter point or even a half point is just not enough encouragement for them to give up a once-in-a-lifetime 3% mortgage. So, the market may continue to be locked up with prices still pushing up for those properties that come on the market, and there aren’t too many of them.

However, there are still benefits to modest lower rates, especially for a first-time borrower, enough to qualify many buyers at the lower rate to be approved for financing. Here on Anna Maria Island and all of the other coastal communities in the area, including our neighbor, Cortez, buyers in these areas are less affected by mortgage rates. Therefore, the market for high-end properties will be less influenced by mortgage rates than by the overall economy.

Many if not most high-end buyers are all cash and even if they decide on a mortgage to free up more cash, they will likely not decide on buying because of a quarter or even a half point reduction. They’re eyeing the health of the general economy and the position of the lawmakers, particularly in Congress, to business and the stock market.

Nevertheless, a healthy real estate market generally is good for all of the real estate market. There is a trickle-up effect of a robust lower-end market positively impacting all price points in the marketplace.

August may be one of the slowest real estate months of the year, but sales are made nonetheless. These are the sales statistics for August reported by the Real­tor Association of Sarasota and Manatee:

Single family homes closed 5.7% more properties this year compared to last August. The median sale price was $467,640, down 5.3%, and the average sale price was $665,577, up 9.1%. The median time to sale was 101 days compared to 103 days last year, and the new pending sales were up 16.7%. The month’s supply of available properties was 4.6 months compared to 3.9 months compared to last year.

Condos closed 7.0% fewer properties this year compared to last year. The median sale price was $291,250, down 11.7%, and the average sale price was $354,958, with 8% fewer properties compared to last year. Median time to sale was 120 days this year compared to 139 days last year. New pending sales were 213 sales compared to 175 sales last year. The month’s supply of available properties was 6.4 months compared to 5.7 months last year.

According to the Realtor As­sociation, there is modest growth and stability in the single-family market, with the condo market down. Single family homes continue to be competi­tive, and the condo market is becom­ing more and more buyer friendly.

Will the Federal Reserve move the needle on more rates as indicated or will it just be more of the same old same old? The outcome is evolving, so stay tuned.

Signs of a real estate turnaround

Written by Louise Bolger on . Posted in Business, Castles in the Sand, Real estate | Development.

Did you hear it? Did you hear buyers and sellers, and, of course, real estate professionals slightly exhal­ing the breath they have been holding for over a year now?

There are definite signs that we might start seeing a turnaround in the real estate market, although based on the July sales statistics for Manatee County, we really don’t see it here. You could argue there is a leveling off but certainly nothing to get excited about.

Across the country, however, the National Association of Realtors is report­ing a definite uptick of the market. Sales of existing homes rose unexpectedly in July, raising hopes that the stalled housing market is improving and setting up for a busy fall. Home sales nationally were up 2% from the prior month, which is only a slight gain, but a gain nonetheless.

Manatee County is still showing a decline in the number of properties sold and a decline in the median sale price as well. The inventory of available single family homes in Manatee County in July was 4.8 months, compared to last July’s availability of 3.9 months – a substantial increase. The national median existing home price in July was $422,400, while Manatee County’s median single-family sales price was $489,900.

Mortgage rates have edged down to their lowest level of the year. The average rate for a 30-year fixed rate mortgage declined last month to 6.58%. The hope here is that if the recent decline continues, it could set the state for a better-than-expected fall selling season.

In addition, the Federal Reserve has sent strong messages that rates could be cut. This in conjunction with inventory rising and prices dropping could open the door for first-time and marginal buyers. The Sunbelt, specifically Texas and Florida, have led the nation in the decline in prices.

Buyers are getting more leverage in making offers and choosing a property. However, first-time buyers are still not out of the woods. First-time buyers accounted for 28% of purchases in July. That was down from 30% in June and 29% in July of last year. If the 30-year fixed rate mortgage declines to 6% or below, we will finally see the first-time buyers coming back. We need first-time buyers, even first-time investors to spur the market above them.

Just for the fun of it, I read about a survey of the most expensive neighbor­hoods in the United States compiled by Zillow. Out of the top 10 most expensive neighborhoods, seven of them were in Florida and three were in California. The number one spot went to Coral Gables Estates in Coral Gables, Florida running over Beverly Hills, California. The second spot was Port Royal in Naples, Florida and the third spot was Old Cutler Bay, Florida.

And since we’re talking about Florida high-end listings, Miami’s upper end properties are trying a new tack. They are delisting their properties, not removing them from the market, but delisting, which is not the same thing. About half the sellers in this category are taking a pause until later in the year, probably around November. They believe the market will be more favorable to buyers at this time and also hopefully building a competitive edge since everyone wants something they can’t have. We’ll see if the psychology of this works, but it’s an interesting step either way.

So as we all look forward to the fall and the positive expectations we’re hearing, most of us are all just waiting to exhale.

Are we stuck in place?

Written by Louise Bolger on . Posted in Business, Castles in the Sand, Real estate | Development.

I wrote a column that came out on Aug. 20 talking about moving trends around the country focusing on Florida and Manatee County. This week I’m going to talk about how mobility around the country is stalled and the effect on the economy.

Just to be clear, moving trends are where people are moving to and are separate from how many people are actu­ally moving. As far as Florida, there is a 2% annual growth rate over the past five years. Manatee County is growing as well with a steady stream of new residents pushing into eastern Manatee buying much of the new construction.

However, as much as we may be grow­ing with incoming residents, most of the country is experiencing a slowdown in relocations. In the 1950s and 1960s, 20% of Americans would move each year. There was a slowing down after this because the population was aging and that generation tended to move less. By 2019, the year before COVID-19, 9.8% of Americans moved. In 2023, only 7.8% of Americans moved, the low­est rate since U.S. Census records began in 1948, and 2024 has held steady.

American workers have always been willing to relocate for better job opportu­nity and young college graduates have also been willing to move for the same reason. I worked in the relocation end of real estate in the early and mid-1990s for almost 10 years and it was a thriving business, with several large relocation companies offering their services to corporations. Now, however, relocation packages are less generous, and potential employees can’t afford to close that financial gap and accept a job requiring a relocation. In addition, most households need two incomes now, making relocation for one member of the household more complicated.

So, what’s happening now, why are more people stuck in place in their homes and in their careers? We all know the housing market has stalled with the exception of pockets and areas that still thrive. Because of this, homeowners are in homes that are too small for them and in jobs that aren’t providing upward mobility opportunities.

Young people just entering the work force can’t afford a home and some even struggle with rent. Existing homeowners may have a low percentage mortgage and are not willing to increase that monthly expense and move up and older generations can’t find buyers for their family homes, depriving them of a much-needed downsize.

In the not-too-distant past through the 2010s, a median-income family who bought a median-priced home spent 30% or less of their earnings on housing costs according to Redfin. That housing cost was 39% last year.

None of this is good news for the economy. Corporations need new blood and new ideas and not being able to recruit the next generation into these jobs stag­nates their business. And young employees need the experience and upward career track to move on with their lives.

Sept. 16-17 is the next meeting of the Federal Reserve. Reuters has surveyed economists who are mostly in agreement that there will be a drop in interest rates in September and another one before the end of the year. So, September is the month to watch; if it happens, the stock market will love it and so will first time-home buyers.

We definitely need something to unclog the bottleneck in the real estate market. If we can get those first-time buyers in it will gradually trickle up the real estate ladder and get the much-needed mobility the country needs.

Why aren’t we a boomtown?

Written by Louise Bolger on . Posted in Business, Castles in the Sand, Real estate | Development.

Looking for a boomtown? Then look in the South. Eight of the top 10 U.S. metro areas ranking as boomtowns are in the South; five are in Florida. But there’s not one in Manatee or Sarasota counties or in Tampa – how could that be?

Let’s start with how LendingTree, which determined what a boomtown is, came up with its conclusion. They grouped 100 of the largest metros across eight unique metrics grouped into three categories – people and housing, work and earnings and business and economy.

So if you live in one of the metros that has a lot of housing available but not a lot of earnings, you’ll lose points. Same with employment; if you live in a metro where the workforce is increasing or the annual GDP (Gross Domestic Product) is increas­ing, you’ll get an increase in points.

Since Manatee, Sarasota and Tampa had their big surge during COVID, that is probably the reason why those metros didn’t make the top 10. We may still be ahead of the growing metros in all of the categories analyzed in numbers and dollars, but we’ve obviously leveled off.

The analysis points out that the three largest U.S. metros, New York, Los Angeles and Chicago, ranked 89th, 84th and 94th respectively out of the top 100. It doesn’t mean that New York real estate is declining or that the restaurants are reducing their menu prices and no one is opening a business, it just means that those segments of the economy have leveled off and aren’t growing as fast as other smaller metros.

These are the rankings of the top 10 boomtowns around the country starting with number one: Austin, Texas; Orlando, Florida; North Port, Florida; Nashville, Tennessee; Cape Coral, Florida; Colorado Springs, Colorado; Charleston, South Carolina; Lakeland, Florida; Deltona, Florida; and Denver, Colorado.

Austin also came in number one in LendingTree’s last boomtown survey because of GDP growth and one of the highest increases in housing units. Orlando and North Port, Florida ranked second and third basically for the same increase in GDP and housing units.

On to the June sales statistics published by the Realtor Association of Sarasota and Manatee:

Single-family homes closed 3.2% fewer properties compared to last June. The median sale price was $440,000, down 15.2%, and the average sale price was $583,447, down 20.8%. The median time to contract was 56 days compared to 57 days last year and new listings increased by 2.9%. The month’s supply of properties was 5.2 months compared to 4 months last year.

Condos closed 5.3% fewer properties compared to June of last year. The median sale price was $312,900, down 9.2% and the average sale price was $333,877, down 19.8%. The median time to contract was 68 days compared to 73 last year and new listings were up 5.3%. The month’s supply of available properties was 7.4 months compared to 5.8 months last year. A 6-month supply of available properties is always considered a normal market.

Interestingly, cash sales are down in both sectors 18.1% for single-family and 7.7% for condos.

I have a gut feeling that all potential buyers and sellers in Manatee County are holding their breath waiting to get on the other side of hurricane season, hopefully in one piece before any decisions are made.

So what’s the draw of the South that keeps people moving here? The top of the list is more affordable housing, lower cost of living and more job opportunities. We’re also seeing a chain reaction; the more friends and family move South, others follow. I’m bullish on the continued growth of the South and you should be too. You don’t have to live in a boomtown to know you’re better off.

Disasters may have silver lining

Written by Louise Bolger on . Posted in Business, Real estate | Development.

Last week we talked about the future restoration and look of Cortez after the storms and after the county’s purchase of the Seafood Shack property. This week we’ll cover an emerging trend in the country where communities that have been struck by a disaster are frequently rebuilding richer and more exclusive – sound familiar?

Natural disasters can be galvanizing for a community where people come together to help neighbors and share information about contractors, painters, debris removal and just about anything else. It also presents an opportunity for developers and investors to swoop in and leave their mark on the area.

Homeowners who have received government aid and insurance payouts are rebuilding sturdier homes and meeting updated building codes. In addition to adding another layer of storm protection in the rebuilt homes, homeowners also have the opportunity to remodel damaged areas. This will ultimately translate into a more valuable and marketable property.

Unfortunately, there are low-income homeowners who have more problems navigating the bureaucratic procedures to file for disaster aid and may not have personal funds to close the gap until the funds are available. Also, on Anna Maria Island, longtime residents with beachfront property handed down through families frequently did not carry homeowner’s insurance since the premiums were higher than the value of the building. Many of these cottages and older one-level homes have been sold to developers for the land value. Renters of course can get evicted or choose to move from damaged properties and are facing higher costs and a short supply of rentals.

What this means for Anna Maria Island and Cortez is a change in the profile of the communities. The slow pace of living in these communities is changing, replacing an Old Florida vibe with a jazzier vibe and new, larger homes capable of entertaining family get-togethers and weddings.

Many of these properties are owned by investors or investor groups and are designed for renting and although Anna Maria always had many properties that were available for rent, it still maintained the quality of Island life. Many islanders now fear the Island will never be the same.

A good example of how a Category 5 storm changed a community in Florida is Hurricane Michael, which hit the Pan­handle in 2018. Panama City had an older, slightly tattered downtown area which has been restored with trendy restaurants and boutiques and an increasing popula­tion. Brokers specializing in waterfront properties say wealthy buyers are arriving in growing numbers, raising the economy and value of properties considerably.

While we were talking hurricanes, which I swore I wouldn’t do, I found some interesting statistics from the FSU Florida Climate Center. Starting with the Great Mi­ami Hurricane in 1926 through Milton in 2024, there have only been three Category 5 hurricanes, nine Category 4 hurricanes and 10 Category 3 hurricanes. Don’t get too comfortable with these numbers since the one-two punch of Helene, a Category 4, and Milton, a Category 3, did an incredible amount of damage prior to making landfall compounded with a 4-foot storm surge.

Nevertheless, populations have increased in three of the most severely hit Florida communities. Andrew in Miami was a Category 5, Charley in Charlotte County was a Category 4 and Ian in Lee County was a Category 4 – all increased their populations substantially within a three-year period after the storm.

I’m standing by my prediction from last week about the value of properties in Cortez. I also believe that Anna Maria Island will enjoy an increase in property values as well. You may not like the new vibe, but you may really enjoy the increasing trends in value.

Big holiday, not so big housing market

Written by Louise Bolger on . Posted in Business, Castles in the Sand, Real estate | Development.

July Fourth is this week, so fire up the grill and hang up the flags, but go easy on the fireworks. You may not need real fireworks after reading the May sales statistics for Manatee County and the general housing imbalance around the country, but you need to hear about it.

According to Redfin, the U.S. housing market had nearly a half million more sellers than buyers in April. This is the biggest gap on record going back to 2013, comprised primarily of sellers who need to sell for lifestyle reasons or who may be investors who want to pull their money out before prices readjust downward.

Buyers finally have the upper hand in many markets that are turning into buyers’ markets. Concessions are being made and prices are being cut, but not enough to get buyers flooding back into the market. Nevertheless, home prices are still up more than 50% in the past five years and mortgage rates are not moving off an average of 6.5%. Add this to the general economic uncertainty and you’ve got buyers who are scared silly to make a decision. A friend forwarded to me some mortgage information from a SmartAsset study analyzing mortgage rates in Florida. Manatee County’s typical rate was 6.48%, Sarasota’ was 6.91% and Palm Beach 7% to name a few.

Much of the real estate markets are governed by local activity, however, one of the biggest buyers’ markets is the Southeast, where the inventory of homes for sale is above pre-pandemic levels. For Florida, the only positive news is that the Northeast and Midwest have more buyers than sellers, where historically so many of Florida’s buyers relocate from.

Like it or not, here are the May sales statistics published by the Realtor Association of Sarasota and Manatee.

Single family homes closed 1.9% fewer properties in May of this year compared to last year. The median sale price was $478,195, down 8.9%, and the average selling price was $638,855, down 9.9%. The median time to contract was 52 days compared to 45 last year and the new listings were down 6.6%. The available month’s supply of properties was 5.2 months compared to 4.1 months last year.

Condos closed 0.4% more properties this May compared to last year. The median sale price was $313,000, down 13.4%, and the average sale price was $345,549, down 16.2%. The median time to contract was 60 days compared to 56 days last year and new listings were up 12.9%. The month’s supply of available properties was 7.9 months compared to 6.3 months last year. A six-month supply of available properties is considered normal, therefore, 7.9 months is pretty far out of range.

I’m not sure what to say about this month’s report. Perhaps the Realtor Association of Sarasota and Manatee’s press release says it best: “Sarasota and Manatee County shows continued signs of a market in transition. Inventory remains significantly higher that this time last year, the pace of growth has begun to slow compared to previous months. Finally, buyers are gaining negotiating power, while sellers must adjust to a landscape that favors realistic pricing and patience.”

Enjoy the holiday however you choose to celebrate. Most of all be safe during this crazy holiday whether you’re in a car, at the beach or in a boat. Stay positive about the status of the world and our own little piece of it. Eventually, the real estate markets will level off to a more normal one and the world will hopefully settle down.

All real estate is local, especially now

Written by Louise Bolger on . Posted in Business, Castles in the Sand, Real estate | Development.

My favorite real estate expression is “all real estate is local,” which I have used in this space many times. But what exactly does that mean?

Essentially it means that real estate markets are significantly influenced by local factors and conditions, rather than national or global trends. Also, it means that property values, demand and investment potential can vary greatly even within the same city or across the street.

This is important to the value of property because growth, population trends, school districts, amenities and local regulations all impact property values and demand. Relying solely on national or global trends can lead to poor decisions because they don’t capture the nuances of local markets. Therefore, when you read the following national statistics recently appearing in the Wall Street Journal according to Intercontinental Exchange, a financial technology and data company, keep this in mind: The metro areas that had the biggest increase in home prices in April compared to a year ago are:  Bridgeport, Conn., Scranton, Pa., Hartford, Conn., Syracuse, N.Y. and New York, N.Y. These increased ranged from a high of 7.3% to 6.4%.

The biggest decreases were in Lakeland, Fla., Tampa, Fla., Austin, Texas, North Port, Fla. and Cape Coral, Fla. These declines ranged from a high of 7.5% to 2.2%.

The report also compares home prices vs. change in housing inventories. For example, New York’s prices increased 6.4% in April while inventory was down 46% from pre-pandemic levels. This trend continued through the Midwest down through Texas and Florida ending in Cape Coral, Fla with a decline in prices of 7.5% in a year.

Also influencing these numbers is the amount of southern migrating occurring from 2020 to 2024. During that time, the south’s population grew 5.1% with Florida and Texas benefiting the most. Florida’s population increased 8.5% and Texas’ population increased 7.4% during this period, per the Census Bureau.

In response to the increase in population, builders started building in areas of Florida in particular that were farming communities. There are now new home communities going up in west Bradenton and north of the Manatee River in Parrish, inflating the number of properties on the market in Manatee County.

Nationally, the supply of homes for sale is still around 16% below pre-pandemic levels, according to Realtor.com. which is not what Florida is experiencing. Homeowners who locked in low mortgage rates a few years ago are reluctant to sell their homes and take on new mortgages with a higher borrowing cost, and buyers are still waiting for lower interest rates.

The wrap-up on these numbers is that the Northeast and Midwest home prices continue to rise in all major markets. In the South, particularly in Texas and Florida, prices are flat or falling. And in the West, prices are rising in some markets and falling in others.

In addition, the overall U.S housing market is far less active than it was a few years ago when mortgage rates were low and remote work allowed people to move farther from their offices. Again, I would not bet money on any of this. I’m not saying it’s not true only that it can change in a heartbeat. As soon as the snowbirds from all over the country and Canada figure out that Florida’s prices are dropping, and new construction is readily available, they will come back in force looking for a bargain.

Everything in life is dictated by what’s happening in your state, county, and street. All real estate is local; you better believe it.

Condo ownership challenging

Written by Louise Bolger on . Posted in Business, Castles in the Sand, Real estate | Development.

If you like the condo lifestyle and you live in Florida, you’ve landed in the right place. But even what seems to be the right place can have challenges, especially in the environment we’re currently living in.

Let’s start with the rights of condo owners. Florida condo law, as outlined in the Florida Condominium Act (Chapter 718 of the Florida Statutes) will explain, in fine print, owner rights as an owner, but for the purpose of this column we’ll hit on some of the key aspects.

As a condo owner, you have exclusive ownership of your unit; remember, when you purchase a condo, you receive a deed just like if you purchase a single-family home. This includes the right to occupy, decorate, renovate, lease or sell your unit. Every condominium association has certain restrictions on these above rights which will be disclosed to a prospective buyer in both the association’s condo docu­ments as well as their rules and regulations. For instance, there could be limitations on types of modifications that can be made and may require board approval for renovations and/or modifications.

Owners have access to common elements such as pools, gyms, docks and clubhouses. Again, all of this is within association guidelines based on hours, noise restrictions and ongoing repair work.

Living in a condo association, you are automatically a member with a voice in the governance of the community. You will be asked to vote on material alterations, elec­tions for the Board of Directors and other significant community decisions. I can’t emphasize enough that becoming active in the community, volunteering on commit­tees and running for a board position is one of the most important things you can do if you want your voice heard.

Florida law ensures that condo owners have the right to inspect the association’s official records. Not all of the financial records can be disclosed in a board meet­ing, therefore, if you want more detailed information, you can ask the board for specific records you want to review.

Since no one is perfect, there may be times when you as an owner feel that rules are not being enforced equally or that there are excessive rules. This is also protected under Florida’s condo law and should be brought to the attention of the Board of Directors.

Certainly, the most important aspect of your rights as an owner is the stability of the association’s finances. This includes increases in fees, the addition of special assessments and a clear justification for fee increases, all of which can be contested by an owner.

One of the reasons to know what your rights are as a condo owner is coming to a head in several states but particularly in Florida. As a result of the Surfside disaster, Florida enacted specific inspec­tion laws relative to the stability of condo buildings that are three stories or higher. Condos need to be inspected by a Florida qualified inspector and if there are any structural repairs required, the association is mandated to make the repairs. In addition, in Florida, condo associations have to prove through their financial records and reserves that they have adequate funds to make any repairs needed.

Condo associations that haven’t prepared for this are facing large assessments and are also putting the ability of buyers to be approved for financing in jeopardy. Fred­die Mac is quietly blacklisting areas of the country or individual associations where mortgages will not be approved. This extends itself to the insurance industry, which could be another obstacle in the way of selling your condo.

A condo is still the most carefree lifestyle and perfectly suited to Florida living. You just need to stay on top of how the association is spending your money, stay involved and understand your rights.

The new real estate reality

Written by Louise Bolger on . Posted in Business, Castles in the Sand, Real estate | Development.

It’s been six months since Hurricane Milton invaded us and every day we still feel the effects of the storm. Most of us are either continually rebuilding, cleaning up or juggling finances to get our lives back to where they were before the storms.

Last week we talked about buyer and seller remorse, but the deeper emotional issues are losing your home and your possessions. Most people have an emotional attachment to their homes and their community. Seeing disruption or actual loss has a lasting effect. A home is part of a community of friends, family, neighbors and memories.

Adding to the emotional loss is the sudden financial hardship of losing one’s home or experiencing major and costly repairs. Most people invest a huge portion of their net worth into their home and have accrued a great deal of equity, so watching it go literally down the drain leaves many homeowners worrying about their future financial security.

For Island people who have made the decision to move, selling after a major disaster can be challenging at best. These are the sales numbers the Realtor Association of Sarasota and Manatee provided for the two zip codes on Anna Maria as of February:

Zip code 34217, Bradenton Beach and Holmes Beach single-family homes: The median sale price in February was $1,105,000, down 39% from last February. The average sale price was $1,414,583, down 52.4% from last year, and new listings are up 33.3%.

This is the report from The Realtor As­sociation for condos in Bradenton Beach and Holmes Beach. The median sale price was $535,000 this February, down 13.7% from last year and the average sale price was $553,333, down 26.1%. New listings are up 6.7%.

Obviously, the single-family numbers look far worse than the condos, likely because there are so many single-family homes that were not elevated and had se­vere damage selling for reduced numbers compared to last year. The majority of condos are elevated and experienced less damage, at least from flooding.

Anna Maria, zip code 34216, had a median sale price of $1,750,000, down 12.5% this February compared to last year. The average sale price was $1,808,333, down 27.6% from last February. Finally, new listings in Anna Maria are up 31.6%.

Selling your home in the aftermath of a disaster requires patience and a fair amount of creativity. These properties need to be marketed as the future value, not the present value. There is great investment opportunity on the Island and based on the number of visitors in the past month, people still want to vacation here.

Buyers, especially younger buyers, are very much influenced by climate change and the effects that it will have on a barrier island. So, a balance has to be struck when listing the benefits and financial invest­ment available on Anna Maria Island. You can’t hide that we experienced a serious series of storms, and you have to be honest about damage sustained, but here again, we’re looking at future growth.

The effects of the storm, both physically and monetarily, are deeply unsettling. The physical landscape of the community changes and people move away, leaving a constant feeling of loss. It’s important to stay focused on how Anna Maria Island was before the storm and know it will come back right along with property values.

It’s the buyers turn

Written by Louise Bolger on . Posted in Business, Real estate | Development.

Balance of power is something we usually talk about as it relates to international positioning between powerful nations. Now the phrase is lending itself to the real estate market and the buyers are finally getting the upper hand.

Homebuyers are benefiting from the fading disappearance of bidding wars. Sellers are willing to lower prices and offer incentives. Increased home listings are working to the advantage of buyers with less competition and more negotiating room. And most important of all, sellers are becoming more flexible, accepting offers below the asking price especially for properties that need repairs – like on Anna Maria Island – or proper­ties that are in less desirable areas.

However, all real estate markets are not equal. The National Association of Realtors indicates that homeowners with ultra-low mortgage rates have been reluctant to sell, but that is starting to loosen up as more people decide they can’t keep putting off a move and wait for rates to take a nosedive. The rates are starting to trend under 7% but not enough yet to move the needle and change the real estate market.

Housing inventories are also rising in certain states where properties look overvalued, so buyers are backing off. Because of the migration to the Sunbelt states during the pandemic, property prices in some southern states rose faster than in other parts of the country. In Florida, for instance, the value of the median home increased 64% over the past five years according to Redfin, compared with 42% in Illinois and 17% in New York. As we know, many of our out-of-state residents come from Illinois and New York.

The huge increase in value that Florida has enjoyed is slowing down as migration to Florida has slowed. The state is importing fewer new high wage earners to support the home prices and the insurance costs, putting affordability of home ownership out of balance for many buyers. Nevertheless, Florida is still a popular state and very tax friendly compared to northern states, with insur­ance costs starting to trend downward.

February sales statistics for Manatee County are out, published by the Realtor Association of Sarasota and Manatee:

Single-family homes closed 22.1% more properties since February of last year. The median sale price was $480,000, down 8.6%, and the average sale price was $662,504, down 10%. Median time to contract was 49 days compared to 35 days last year, and the month’s supply of available properties was 4.6 months compared to 3.9 months last year.

Condos closed 7% fewer properties this February compared to last. The median price was $335,990, down 6.1% and the average was $408,238 down 7.5%. Median days to contract was 60 days compared to 47 days last year and the month’s supply of available properties was 8 months compared to 5.6 last year.

The wrap-up on these numbers indicate that sellers are no longer in a competitive market and need to adjust their expectations. Median sale prices are down, it’s taking longer to sell and new listings are going up across all categories.

Homebuyers have the most leverage over sellers in years. In our region, last year’s storms have increased that leverage. Eventually the market will catch up to the number of properties available, so pay attention buyers, this is your window.

It’s the buyers turn

Written by Louise Bolger on . Posted in Business, Real estate | Development.

Balance of power is something we usually talk about as it relates to international positioning between powerful nations. Now the phrase is lending itself to the real estate market and the buyers are finally getting the upper hand.

Homebuyers are benefiting from the fading disappearance of bidding wars. Sellers are willing to lower prices and offer incentives. Increased home listings are working to the advantage of buyers with less competition and more negotiating room. And most important of all, sellers are becoming more flexible, accepting offers below the asking price especially for properties that need repairs – like on Anna Maria Island – or proper­ties that are in less desirable areas.

However, all real estate markets are not equal. The National Association of Realtors indicates that homeowners with ultra-low mortgage rates have been reluctant to sell, but that is starting to loosen up as more people decide they can’t keep putting off a move and wait for rates to take a nosedive. The rates are starting to trend under 7% but not enough yet to move the needle and change the real estate market.

Housing inventories are also rising in certain states where properties look overvalued, so buyers are backing off. Because of the migration to the Sunbelt states during the pandemic, property prices in some southern states rose faster than in other parts of the country. In Florida, for instance, the value of the median home increased 64% over the past five years according to Redfin, compared with 42% in Illinois and 17% in New York. As we know, many of our out-of-state residents come from Illinois and New York.

The huge increase in value that Florida has enjoyed is slowing down as migration to Florida has slowed. The state is importing fewer new high wage earners to support the home prices and the insurance costs, putting affordability of home ownership out of balance for many buyers. Nevertheless, Florida is still a popular state and very tax friendly compared to northern states, with insur­ance costs starting to trend downward.

February sales statistics for Manatee County are out, published by the Realtor Association of Sarasota and Manatee:

Single-family homes closed 22.1% more properties since February of last year. The median sale price was $480,000, down 8.6%, and the average sale price was $662,504, down 10%. Median time to contract was 49 days compared to 35 days last year, and the month’s supply of available properties was 4.6 months compared to 3.9 months last year.

Condos closed 7% fewer properties this February compared to last. The median price was $335,990, down 6.1% and the average was $408,238 down 7.5%. Median days to contract was 60 days compared to 47 days last year and the month’s supply of available properties was 8 months compared to 5.6 last year.

The wrap-up on these numbers indicate that sellers are no longer in a competitive market and need to adjust their expectations. Median sale prices are down, it’s taking longer to sell and new listings are going up across all categories.

Homebuyers have the most leverage over sellers in years. In our region, last year’s storms have increased that leverage. Eventually the market will catch up to the number of properties available, so pay attention buyers, this is your window.

Tax relief on the beach

Written by Louise Bolger on . Posted in Business, Real estate | Development.

It’s tax time again and tax time is never fun, but this year could be particularly not fun. In view of the 2024 storms, this tax filing season could be quite a bit different in addition to the normal tax benefits afforded homeowners.

I’m not a licensed CPA or even a tax preparer, so you always need to seek advice from a professional when it comes to finance of any type. I did, however, find a couple of points related specifically to Hurricane Milton. On Oct. 11, 2024, the IRS announced disaster tax relief for 51 counties in Florida.

Affected Florida taxpayers will now have until May 1, 2025, to file various federal tax returns and make certain tax payments. In addition, Hurricane Milton was considered a federal disaster, therefore, personal casualty losses can be deducted to the extent the losses are attributable to a federally declared disaster.

In normal times for the average taxpayer, your home is still the best shelter from taxes. Mortgage interest for a first or second mortgage or home equity loan is a deduction for taxpayers who itemize deductions. This deduction is for your primary home and to a lesser degree for a second home.

Local property taxes can be deducted subject to the SALT (state and local taxes) cap, which is $10,000. However, the cap is very controversial and there is an ongoing battle in Congress to get it reversed. SALT is part of the temporary 2017 tax law that is due to expire at the end of 2025 which could affect taxpayers in all states with high property taxes.

Home office deduction is frequently a gray area for people who do a lot of work from home. The law is if you receive a W-2 from an employer you cannot take the deduction for working from home no matter how much work you do for your employer from your home. The deduction is for individuals who use part of their home exclusively and regularly for business purposes.

There is a long list of expenses you have in running your home that you cannot deduct: Insurance, including title insur­ance; wages you pay for domestic help; depreciation; utilities and home repairs; internet or Wi-Fi access; and homeowners or condominium association fees.

The government does provide certain credits affiliated with energy-efficient home improvements up to $3,200 a year. The credit is for 30% of the cost of the improvement. Insulation, windows and doors qualify as well as heat pumps, water heaters and biomass stoves. In addition, homeowners who add solar, wind or geothermal power generation, solar water heaters or battery storage to their homes can claim a residential clean-energy credit.

The biggest tax savings, however, is when you sell your home, particularly if you have accrued a large amount of appreciation in your property. The gain in value in your property is the difference between the selling price and the adjusted base, which includes what you paid for the house, plus renovations or other capital improvements, which could be a long list.

In addition, the government gives homeowners a home-sale exclusion which further limits your capital gains. The exclusion for single tax filers is $250,000; for married couples filing jointly, it is $500,000. To qualify you must have used the house as a primary residence for at least two of the previous five years.

Good luck with your taxes. Remember to always consult a tax professional, especially this year if you have had home damage. Be happy it only comes once a year.

Life-changing events can reset priorities

Written by Louise Bolger on . Posted in Castles in the Sand, Real estate | Development.

To say that a combination of Hurricane Helene and Hurricane Milton less than two weeks apart changed the lives of everyone on Anna Maria Island and most of the coastal areas of Manatee County would be a gross understatement. Some areas came back sooner than others, but everyone was influenced by the storms and shocked at the amount of cleanup and repairs needed to get their lives back fully on track.

Last week we reviewed the Manatee County sales statistics provided by the Realtor Association of Sarasota and Manatee along with their ac­companying news release. Essentially, they’re saying our real estate market all over the county is changing to a buyer’s market, no surprise there. The surprise is how fast it happened and how fast fortunes can disappear.

I haven’t made a comparison of listings compared to pending proper­ties in a long time, but in view of this month’s numbers, it’s probably time; please note the listings include all variety of properties.

Starting with the City of Anna Maria, as of this writing, there are 70 properties available for sale ranging from $20 million to $549,900. There are nine in the upper range above $6 million, 38 in the mid-range and 23 at $2 million and lower. The upper range listings had no pending properties, the mid-range had three pending proper­ties and the lower range had five pending properties, for a total of eight pending properties out of 70 listings.

The combined cities of Holmes Beach and Bradenton Beach had 232 listings as of this writing, ranging from $16,750,000 to $60,000. There were 14 properties in the upper range above $6 million, 46 properties in the mid-range and 30 properties in the lower range below $2 million. The upper range did not have any pending properties, the mid-range had two pending properties, and the lower range had 32 pending properties. The total listings combined in the three cities on Anna Maria Island were 302 with 40 pending – you do the math.

The village of Cortez had 32 proper­ties listed ranging from $3,899,000 to $79,500 with two pending.

Although we experienced devastat­ing storms, giving our real estate market an unexpected blow, the coun­try as a whole is also experiencing a downward market. Data from the real estate analytics firm CoreLogic shows nearly 73,000 homes were pulled from the market after they failed to find a buyer in the final month of last year.

Sellers are reluctant to take lower prices especially if it means giving up their ultra-low mortgage rates. Home sales in 2024 were at their lowest level in nearly 30 years. Eventually sellers will slowly be more realistic if they need to sell because of a job, growing family or other life events that can’t be delayed. Green Street, another analyt­ics firm, predicts that U.S. home prices are vulnerable to a correction.

On the other hand, the luxury home market is putting a lot of pressure on the entry level home market. As prices go up in the luxury market, it takes everything below right along with it. This is true in the Miami area with their influx of the super-rich moving the annual number of home sales above $1 million up 147% compared to 2019.

Sometimes life-changing events are good to reset our priorities in life and remind us how quickly things can change. Keep cleaning, keep painting and be happy – you still can.

Everything is negotiable

Written by Louise Bolger on . Posted in Business, Real estate | Development.

About a month ago, we talked about being in uncharted territory as it relates to the real estate market. Not much has changed for the better in the last month and the statistics for January will confirm that. However, properties are still being listed, and buyers are still out there, and as usual, sellers want top dollar and buyers want bargain basement prices.

One of the tenets of the real estate industry is the ability to negotiate price. According to a survey conducted by Lending Tree in May 2023, 63% of buyers have successfully negotiated a home’s price, 38% negotiate closing costs and 36% negotiate repairs.

The terms of an offer are every bit as important as the price. This includes closing date, mortgage contingencies and furniture. And don’t take the furniture is­sue lightly, especially for condos in Florida. It’s pretty common to purchase condos, even luxury condos, with the furnishings, including furniture, wall coverings and even other decorative objects.

If you are negotiating a sale including what would be considered personal items, make sure there is a detailed list of what is being conveyed with the property as part of the contract of sale. In your mind, your grandmother’s original Tiffany lamp will, of course, not leave the family, but the buyer assumed otherwise when you negotiated the personal items. And don’t think buyers, especially in the uncharted territory we’re in right now, won’t walk because of this dispute.

Information is powerful, particularly during the negotiating process. The more you know about the buyer and seller the more power you have, for example, buyers who have already sold their home or are in contract to do so, or sellers who have other buyers in the background or have had no showings in months.

By far the most important thing you can do when negotiating is to be respectful of the other parties’ position and don’t make demands. If you’re successfully diplomatic, you can turn down an offer and still leave the door open in a reasonable way by asking for a reframing of the offer.

Time to see what the Manatee County sales statistics look like for the month of January, reported by the Realtor Associa­tion of Sarasota and Manatee:

Single-family homes closed 22.1% more properties. The median sale price was $480,000, down 8.6% from January of last year, and the average sale price was $662,504, down 10.0%. Median time to contract was 49 days compared to 35 days last year, and there are 8.5% more listings this month compared to last year. The month’s supply of available properties was 4.6 compared to 3.9 months last year.

Condos closed 7% fewer properties compared to last year. The median selling price was $335,990, down 6.1%, and the average sale price was $408,238, down 7.5%. Median time to contract was 60 days compared to 47 days last year, and new listings are up 2.2%. The month’s supply of available properties was 8 months compared to 5.6 months last year.

The Realtor Association points out three trends: A decrease in median sale prices across all property types, increased time to sell and contract – meaning it is taking longer to sell across all segments – and finally, there is some growth in closed sales, likely leftover transactions from the end of last year.

So much of buying and selling residential properties is emotional, so keeping your emotions in check will serve you better. You could, of course, read “The Art Of the Deal” written by Donald Trump for pointers in negotiating. Just be careful, negotiating is certainly an “art,” so hard and fast rules don’t apply.