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Tag: Castles in the Sand

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.

Buyers, sellers, hurricanes – and remorse

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

Remorse is the feeling of regret, second thoughts or disappointment in a decision recently made. When it comes to buying and selling real estate, it’s difficult not to have some level of remorse about the transaction, especially in the situation we’re in now.

Anna Maria Island has always been that special little place different from other coastal areas of Florida. Old Florida was true in Anna Maria, with no high rises, no big box stores and no drive-throughs. Island residents fought to keep it that way and were successful for decades.

The storms that invaded us last fall changed much of that. It took away prop­erty owners’ sense that they were living in a very unique place they loved when they had to make some life-changing difficult decisions. Because of damaged properties and insurance issues, many homeowners were put in the position of having to sell their beloved home and move off the Island, frequently accepting offers that were very discounted.

The seller’s remorse for these homeowners is very real; sadness, regret, anxiety and just plain mad that this happened to them. They not only lost their home but their very special lifestyle and for some, will never get it back. Coupled with the loss of their homes, most homeowners on the Island who experienced serious damage have also experienced a major financial loss. Even when the transac­tion is done, and you know this was the only option for you, it’s easy to still feel like you’ve made a mistake.

Sellers aren’t the only ones feeling remorse these days; buyers who are buying up many of the damaged Island properties are primed to think they, too, may be making a mistake. The high cost of living on a flood- and hurricane-prone Island could be giving even buyers with deep pockets reasons to feel remorse and have them running to higher ground.

Developers who are rushing to buy up properties and turn them into profitable rentals are only looking at their bottom line. They can tolerate the high insurance bills, maintenance issues of living on an Island and threat of storms in return for a big rental payday.

Individual buyers, however, may start to feel remorse buying into a storm zone. Did they make a decision too fast, have they overspent, even though it looked like a good deal, and, in retrospect, are they reconsidering how compatible Island living is for them and their families?

Some buyers wait years until they can afford their special place and then when it presents itself, bam, you’re thinking, “What did I do?” All of these feelings are real and may not actually materialize until the sale is final and there you are living on an Island possibly with homes being rebuilt around you.

It could take buyers years to shake off the feeling of remorse. Eventually, the entire Island will be rebuilt, and small-town life will hopefully be back.

As far as sellers, they’re probably asking themselves, will I ever see those beautiful sunsets again, will I ever be able to walk one block or 10 feet to feel the warmth of the Gulf waters and will I ever live in a place that I think of as special again?

My answer to that is all of what you love about Anna Maria Island is still there, only a short ride over the bridge. Get your Island fix even if you don’t live there anymore; you’ll feel better instantly.

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.

Time for a kitchen redo

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

I don’t know about you, but I’m just now getting my condo back in pre-Milton shape. It took five months and there are still a few jobs to finish up, not to mention the dust that has settled in the crevices of my furniture and windows.

Not everyone is as lucky as me. Many island people and throughout Manatee County need to do massive rebuilds and renovations. If you find yourself needing a kitchen rehab, take a look at some of the new ideas for kitchens I recently read about.

The big news is we’re going back to earthy neutrals and leaving the sterile white kitchens behind. Even the blue that we’ve seen in kitchen updates recently is making way for beiges, soft browns and even dark wood with appliances behind matching doors. The object is to create spaces that are cozy and more intimate than we have seen for years.

Beams are also popping up in Florida, adding texture and architectural interest to high ceilings. Dark beams are typical, but I think white in a kitchen to offset the new trendy darker cabinets gives interest while still maintaining a coastal look. Even cabinet pulls are evolving from the glitzy metal to soft wood tones.

Lighting is naturally the key to making a cozy space come alive. The designers I read about are loving single horizontal fixtures over kitchen islands taking the place of pendants and nixing recessed ceiling lighting.

This next one is certainly not new but is gaining popularity again and is perfect for the casual island lifestyle we’re all trying to get back to. Bistro racks or French shelving in place of cabinets check several boxes for coastal living. First of all, if the shelving is glass, they will appear to be floating, opening up the entire wall where they’re arranged. Paired with contrasting tile to the ceiling will make you wonder why you haven’t done this before. In addition, there is the ease of organizing dishes and glassware where everything is visible and there are no doors to open and close in the way.

While we’re talking about cabinets, guess what’s back, curtain-backed glass cabinet fronts. It works really well for the less organized of us where you really don’t want your chipped dishes displayed and adds a more formal design, making your cabinets feel like actual furniture. However, if you love your shaker-style cabinets, they are iconic, so don’t start ripping them out, but some day it might be time to move on.

Finally, nothing is more talked about in a kitchen than countertops. I remember when you never saw a hard surface countertop and everyone used laminate; hopefully, those days will never be back. However, the popular granite for decades is back in a more exciting reincarnation. The new granite has matte finishes, with a rougher and more rustic vibe perfect for some of the new rural kitchen choices. It has a slate-like appearance and is still virtually indestructible.

Marble is definitely out. Not only does it look too cool and industrial, it is high maintenance, staining easily – red wine and lemon juice are killers on marble. I had occasion to see one of these new granite products in a friend’s house in Naples on top of a massive kitchen island and it knocked my socks off.

Apparently, the decorative items you never thought you would ever see again are back. Beams, dark cabinets and granite are in fashion again, but then isn’t it always that way. Remember fins on cars and poodle skirts? Just wait.

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.

New flood disclosure requirements in effect

Written by Louise Bolger on . Posted in Business, Castles in the Sand.

Just what everyone wants right now is a new flood disclosure requirement when selling property. It’s not as if we aren’t aware that Anna Maria Island and the coastal areas of Manatee County could flood after Helene and Milton, it’s just another nail in the coffin for potential sellers.

The new flood disclosure requirements went into effect on Oct. 1, but didn’t get much publicity since it came just before Milton and just after Helene, when coastal residents were busy digging out. Basically, the Florida Statute requires a seller to complete and provide flood disclosure to a buyer of residential real property. The disclosure must be done at or before the time a contract is executed.

There are two points to be disclosed: Whether the homeowner has filed a claim with their insurance provider relating to flood damage on the property and whether they have received federal assistance for flood damage to the property.

The state’s definition of flooding is a general or temporary condition of partial or complete inundation of the property caused by the overflow of inland or tidal waters, the unusual and rapid accumulation of runoff or surface waters from any established wa­ter source or sustained periods of standing water resulting from rainfall, particularly a river, a stream or a drainage ditch. The way I read this is that the statute is more of a protection for properties at risk of flooding from rivers than coastal flooding, which is clearly defined by FEMA’s flood zone map.

Nevertheless, even though sellers were always required to disclose anything about the property that would affect the value of the home, adding a specific disclosure for flooding is a good thing. The Seller Property Disclosure form will be updated, making this new law part of the form extending the existing flood sections so that sellers have to provide more information to consumers.

Anna Maria Island has been called a 7-mile-long tropical oasis. For those of us who have lived on, near or worked on the Island, we know this and mourn the damage done by the storms this year. Unfortunately, there are changes to the Island that have been going on for some time but will likely be accelerating in the wake of the damage experienced on the island.

The fulltime population of the Island has been declining steadily. There were double-digit declines in Holmes Beach and Anna Maria and somewhat less in Bradenton Beach according to the last U.S. Census Bureau report between 2020 and 2021. We can only assume that this trend will not only continue but increase when the after-effects of this storm season are added up.

We already know that investors are aggressively buying up properties on the Island that have suffered irreversible dam­age with an eye to leveling the structures and building even more large three-story homes geared for rentals. We can also expect to see the addition of high-end resort style construction, further elbowing out the private homeowners and retirees.

America’s population has been growing in the southern part of the country for decades. And it has risen especially fast since the pandemic. The South gained an additional 3.9 million people between April 2020 and July 2023 according to the Census Bureau. Deep-pocket investors are looking at this trend, eyeing our beautiful beaches and Gulf waters and aren’t running away.

So, flooding or no flooding, there are plenty of investor groups out there who feel the return on their investment is worth the risk. After all, Milton was a “once in a lifetime event” – you think?

Home sales in the time of storms

Written by Louise Bolger on . Posted in Business, Castles in the Sand.

There is nothing normal about Manatee County’s sales statistics for September and October. The sales reporting, of course, includes Anna Maria Island, the coastal communities and even homes and communities further east.

It’s almost impossible to provide ac­curate information, especially since most of the closings in September and some in October were already in contract before our devastating storms. As we move along through the end of the year, the sales will be more accurate and they won’t be pretty.

Let’s start with September sales statistics reported by the Realtor Associa­tion of Sarasota and Manatee:

Single-family home sales were down by 14.2%. The median sale price was down 6.7% and the average sale price was down 5.1%. The median time to contract was 47 days compared to 29 last year and the month’s supply of available properties was 3.9 months compared to 2.9 last year.

Condos closed 25.5% fewer properties. The median sale price was down 8.6% and the average sale price was down 12.7%. The median time to contract was 73 days compared to 46 days last year and the month’s supply of available properties was 6 months compared to 3.3 last year.

The key points for September are a decrease in sales volume, a price adjust­ment and a growth in inventory.

These are the October sales statistics:

Single-family homes closed 22.8% fewer homes. The median sale price was down 0.2% and the average sale price was down 7.3%. The median time to contract was 60 days compared to 29 days last year and the month’s supply of available properties was 3.9 months compared to 3.3 months.

Condos closed 24.7% fewer properties. The median sale price was down 11.4% and the average sale price was down 13.7%. The median time to contract was 75 days compared to 30 days last year and the month’s supply of available properties was 6 months compared to 3.8 months last year.

The key points for October are similar to September, with a decrease in closed sales, increase in inventory, longer time to sell and a decline in cash sales, which did not show up in September.

In spite of our local September and Oc­tober statistics, an index of new mortgage loan applications in the U.S. rose 2% a few weeks ago. The rates climbed back above 7% for the week ended Nov. 15, according to the Mortgage Bankers Association. This indicates that higher mortgage rates aren’t slowing down buyers who really want to get into a home.

In addition, Redfin reported that single-family home prices nationally rose 5.9% in October, which is the low­est annual increase since last December. Higher mortgage rates have slowed price increases that have been surging since the pandemic.

Unfortunately, younger buyers are competing with wealthier, all-cash buyers whose share of home purchases has increased from 20% to 26% in the past year. The average age of home buyers in the country has risen by six years since July 2023.

The Realtor Association made this statement at the end of October: “With the challenges of three hurricanes this summer, rising interest rates, higher insurance premiums and a dip in con­sumer confidence in our area, we are still in a strong position heading into 2025.”

Let’s hope they’re right and we do get back to a strong and more normal market now that the storms are gone and the holidays are upon us.

The epic storm that crept up on us

Written by Louise Bolger on . Posted in Business, Castles in the Sand.

Hurricane Helene was the second deadliest storm in 55 years, Katrina being the first. Did we expect it? I didn’t, and I think most Florida coastal residents did not fully understand the danger of such a large storm and the biblical storm surge it brought.

There are so many moving parts involved in a real estate transaction that can go wrong, but the ultimate is when severe damage occurs when the property is under contract to sell. So who’s responsible for damaged property prior to a closing? The short answer is the seller.

Most contracts contain a “risk of loss” provision that almost always places the risk on the seller and could kill the deal. That doesn’t mean all buyers will walk away from a contract of sale, which they have the legal right to do. That said, some of the damage to properties on the Island is so severe there may not be any way back for buyers. It will be interesting to see if Manatee County proceeds with the purchase of the Seafood Shack property that was scheduled to close on Oct. 7. The building is standing, and I have not been inside, but the two very large dumpsters that are filled to the brim tells the story.

Since Anna Maria is a vacation paradise, what happens to the funds vacationers have already paid or have pending for a future booked date? All of this depends on the rental contract the renters signed, but on a small island dependent on renting vacation properties, I would be surprised if the owners and their realtors didn’t make these people whole.

As always, an attorney should be consulted to review your sale contract or your rental agreement if you find yourself in one of these two situations after the storm.

By now hopefully everyone with property damage has contacted their insurer and got the ball rolling for compensation. It will be a long, arduous process in addition to the emotional aspect of the storm not to mention the clean-up.

However, there will be properties that cannot be restored, and the danger of properties being condemned is certainly possible. My FEMA research tells me that FEMA does not have the legal authority to condemn or demolish houses or buildings. They can provide contractors to inspect disaster-related damage to homes and property, but they do not condemn property. Local jurisdictions have the legal authority to condemn your property, which is a complicated process. FEMA’s website on condemning property will give you more detailed information.

Unfortunately, in Florida, if your property is condemned, you will still need to repay your mortgage. If your property is condemned, you likely will receive a condemnation payment to help pay off the loan or you can work with your lender for a loan modification or forbearance.

Finally, as fate will have it, a new Florida law was enacted on May 30 this year requiring sellers to disclose if a property has filed insurance claims for flood damage and whether federal assistance has been granted due to flooding.

My husband and I live on the Intracoastal Waterway in Cortez and have never in 25 years seen water under our building – this time there was 4 feet. We didn’t evacuate and considered not even moving our car since with Idalia last year there was no water intrusion. Thankfully we were safe, our car was moved to higher ground and survived but it does give you pause when you see the destruction surrounding you.

We’ll talk more next week about how this phenomenon affects property values if at all and the overwhelming desire of humans to live near the water.

Rent, buy or add on?

Written by Louise Bolger on . Posted in Business, Castles in the Sand.

Confused? Of course you are, if you’re a potential buyer. We are living through a very dysfunctional housing market and the maze doesn’t look like it’s ending any time soon. Should you buy, should you rent or should you find a tiny accessory home? The answer is different for everyone.

Buying has almost always been favored over renting when it comes to housing. For some, renting is considered “throwing money away” while buying is an “invest­ment.” The truth is the answer is much more nuanced and really depends on what is the right fit for you.

Renting is a short-term solution as opposed to homeownership, which is much more of a commitment in terms of finances, time and labor than renting. Nevertheless, the argument for home ownership has always been building equity and doing as you please with your property.

In today’s real estate world, home­ownership is very elusive to first-time buyers. Inventory is in short supply, interest rates are rising and particularly in Florida, insurance is totally unpre­dictable from one renewal to the next. Right now, the cost of buying a home versus renting one is at the most extreme since at least 1996. The average monthly new mortgage payment is 52% higher than the average apartment rent, according to CBRE, a global commercial real estate services company.

A person buying a home today will pay 60% more for monthly repayment costs than if they had bought the same house three years ago. As a compari­son, rents rose by 22% over the same period, a little ahead of the inflation rate but far below the cost of purchas­ing on a monthly basis.

If the home you’re considering buying is a long-term investment and you can scrape up the monthly costs with a little extra for inevitable repairs, then in the long run you’re better off. But this decision is an individual one based on job security, family needs and the desire to grow equity.

Trying to fill the lack of the affordable property gap are tiny homes or ADUs (accessory dwelling units). These are typically small apartments tucked away in the backyard, over garages or extended out from the main house. They are getting a second look from buyers who are build­ing, and contractors are providing options for these units as part of new construction. This is a growing trend to keep an eye on.

Finally, I feel that in the best interest of homebuyers, I must mention this last item. Realtors – specifically The National Association of Realtors (NAR) – are facing two federal antitrust trials relative to com­missions charged. Realtor commissions are typically 6% shared between the listing and the selling agents, creating a potential conflict of interest. Keep in mind this is not set in stone and sellers can ask for a lower rate before they enter into a listing contract.

The first of these two antitrust cases was decided by a jury against the NAR on Oct. 31. The decision will be appealed, and it could take years before there is any final conclusion. The second case has not gone to trial yet, but we can assume there will be more antitrust cases going forward.

This ruling and others that may be com­ing can possibly change the way business is done in the real estate community. I know how hard most real estate profes­sionals work and how much experience they offer their clients; therefore, I’m staying neutral.

Well, if you were confused before, I just made it a little more confusing. However, renting or buying should not be confusing, it should be well thought out before moving forward.

Castles in the Sand

Is it worth the walk?

Written by Louise Bolger on . Posted in Business, Castles in the Sand.

Many years ago, my husband and I were in Athens, Greece, and on our way down from touring the sights at the top of Acropolis Hill, someone stopped us and asked, “Was it worth the walk?” After my initial shock that this question would be asked – considering where we were – I thought, “Isn’t everything worth the walk?”

The thing that is definitely worth the walk now is every single house that comes on the market in your price range, even if it’s not exactly your dream house.

We’re in what appears to be a changing real estate market. This spring seems likely to be less competitive than last spring when homes flew off the market as buyers rushed to take advantage of ultralow interest rates in an appreciating housing market. Some buyers will have to drop out of the market if they were borderline for financing, but there will still be plenty of qualified buyers and plenty with cash. No one expects prices to go down anytime soon, but an increase in inventory is looking promising.

The increase in mortgage rates is slowing home sales. Existing home sales fell 4.5% nationally in March compared to March of last year, according to the National Associations of Realtors. Manatee County’s home sales for March decreased by a lot more than that, falling by 20.2% compared to March of last year. In the opinion of the chief economist for the National Association of Realtors, the frenzy is winding down and the volume of home sales is starting to revert to pre-pandemic levels. That I’ll believe when I see it, especially on Anna Maria Island. There are still multiple buyers for every property that comes on the market, even if there will be more properties available.

As reported last week, Manatee County continues to ride the enormous wave of an appreciating market. Selling prices continue to break records in both Manatee and Sarasota and indeed the entire North Port-Sarasota-Bradenton region, which is reporting a 29.9% increase in single-family homes from last March. Sarasota County also showed a large increase of 28.4% in the sale price for single-family homes, however, Manatee County led the pack with a 32.9% increase in single-family sales prices.

So where does all this great information and opinion leave potential buyers? It leaves them with the hope of more properties to see that may fit what they’re looking for. They shouldn’t expect the prices, certainly in our area, to change much, if at all, but they may get more of what they were looking for in a home.

This goes directly back to my “Is it worth the walk?” scenario and the answer is “Yes.” Every house that comes on the market in your price range and in your desired area should be seriously considered. Forget about the colors on the walls or the lack of interesting landscaping or the clutter on the bathroom counters. It’s time to go back to basic house-hunting principles: If a home has good bones, it should go on your list; if you can qualify for a mortgage for this home, it should go on your list; and if the home is workable, keeping the future in mind for your family or for your investment, it should go on your list.

It’s possible that eventually, prices will level off as the pipeline of buyers waiting for new properties is gradually exhausted, but we have no idea when or if that will happen. Now is the time to take the walk up the hill. You’ll be glad you did.

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The end of an era

 

Addictive real estate

Castles in the Sand

Legislators toss condo rules out

Written by Louise Bolger on . Posted in Business, Castles in the Sand.

For a while there I thought we would have one more headache to worry about in addition to insurance rates and hurricanes. On March 11, Florida legislators failed to reach an agreement on a bill to improve building structures. So, one less headache but far less oversight.

Therefore, let’s take a quick review of what is going on. Because of the Champlain Towers South collapse on the east coast, everyone woke up to the possibility of older condos, especially those on or adjacent to barrier islands, being in jeopardy. Florida lawmakers attempted to pass legislation that would require specific inspections for condo buildings. However, at the end of the legislative session, they were not able to come to an agreement. Some of the legislators cited hardships on condo owners and associations who are not in a financial position to bear the brunt of the inspection results.

These discussions have been going on for a while and about a month ago the Florida House passed a bill outlining measures to help alleviate the possibility of older condo buildings being neglected. It was passed in the Florida Senate to little avail since they closed the session without any agreement between the two houses. This came as a surprise since most of the legislators and the governor expected something to come out of the negotiations.

The House bill stated that condo buildings that are three stories or taller need to be inspected and recertified at 30 years of age. In addition, those that are within 3 miles of the coast would require recertification at 25 years of age. After that, recertification would be required every 10 years. The Senate bill was similar, changing the benchmark to 20 years for buildings near the coast and inspections every seven years thereafter.

I wouldn’t get too excited about the end of this legislation. First of all, it could easily come back in the next legislative session. In addition, it’s possible that insurance companies and financial institutions may now impose reserve requirements on buildings, stepping in where the state official has been absent.

In spite of what happens or does not happen in Tallahassee, Manatee County’s real estate is still rolling along. These are the February sales statistics published by the Realtor Association of Sarasota and Manatee.

Single-family homes closed 4.3% more homes in February this year compared to last February. The median selling price was $478,000, up 25.8% above last February and almost the same as January of this year. The average sale price was $693,229, up 25.3% from last February. The median time for properties to get into contract is six days of being listed.

Condos closed 16.8% fewer units in February compared to last February. The median sales price was $325,000, up 41.3% compared to last February, and the average sale price was $371,367, up 36.1% from last year. The median time for properties to get into contract is five days of being listed.

The primary problem our market faces is low inventory which is resulting in fewer closed sales. With mortgage rates going up, that will put more pressure on the market from buyers looking to purchase before they go up even further. According to the Realtor Association of Sarasota and Manatee, the imbalance of supply and demand contributes to the rapidly increasing prices.

This is Florida, and for all our success in attracting new residents and having improving housing prices, we still have everything related to living on the water to contend with. I predict this isn’t the end of condo recertifications and a review of condo reserves.

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Surfside: More collateral damage

 

When will the real estate market return to normal?

 

Feng shui your entry