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Information to help you buy a home or condo

Perspective on recent shifts in local real estate market

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On August 23, 2022

In Home Buying, Home Selling, Sarasota

by Peter Crowley, President of RE/MAX Alliance Group

Peter Crowley, President RE/MAX Alliance Group
Peter Crowley, President RE/MAX Alliance Group

If you only paid attention to news headlines, you would be convinced that the real estate market is in a free fall. Citing sensational statistics like “Pending home sales crash 30%” or “Record number of price reductions” may lead one to think that home prices are falling and the pendulum has shifted into the hands of buyers. Not so fast …

It’s important to put these statistics into some perspective to understand what is really happening in our local real estate market throughout Southwest Florida (and most of the United States).

The onset of the pandemic ushered in an unanticipated boom for the real estate market throughout the country and magnified even more throughout Southwest Florida. Once the initial shock of lockdowns and a brief economic scare subsided, the stage was set for booming demand in our local market. An almost overnight shift in demographic trends with work from home options and accelerated retirement decisions created a surge in demand for Southwest Florida real estate.

Furthermore, in an effort to boost the economy, the Federal Reserve’s monetary policy contributed to record low interest rates which added buying power to this influx of buyers. The ensuing imbalance of supply and demand for homes and condominiums led to a strong seller’s market with larger than normal increases in the median price of real estate.

Fast forward to today and the real estate market has undoubtedly changed – spurred mostly by the increase in interest rates related to the inflationary environment that we are experiencing still today. This is where some perspective is important.

The most frequent measure of real estate activity is either month to month comparisons or year over year comparisons. If you accept that 2021 was the best real estate market that our local area (and most of the country) has ever experienced, it stands to reason that as the market starts to adjust back to normal, we will see some sizable percentage changes when comparing today’s activity to last year. These significant changes create eye-catching headlines – “Time on market is up 120%”. That seems like a meaningful jump, but when you consider that homes were on the market for an average of 10-14 days and now it is closer to 30-40 days, the change does not seem that outrageous. In fact, this time on market is still far below what is considered normal.

Most real estate professionals will agree that the last “normal” real estate market was in 2019, before the onset of the pandemic. If we start to frame comparisons based on the level of activity in 2019, things seem a bit less dramatic, and in fact, show that even with our recent market shift, we are still well ahead of 2019 activity.

With the abrupt change in interest rates from below 3% to around 5%, it felt as though the spigot was turning off. The frantic pace of activity with 20+ offers on an available property seemed to evaporate overnight. While closed sales have fallen in the neighborhood of 20% relative to 2021 (the most active real estate market on record), when compared to 2019, we are in fact almost 20% ahead of the level of “normal” activity from that time period.

Furthermore, in spite of the recent cooling of demand, we are still quite out of balance with supply and demand, which is why prices are not expected to go down, but rather moderate from 20-30% record appreciation, to a moderated level of appreciation. Gone are the days that a seller can name whatever price they want to sell with only the most favorable terms. Hence, price reductions are at record levels where sellers are coming back to the reality that a home must be competitively priced in order to sell.

While the absorption of listings has definitely slowed, which leads to an overall increase in listings, our local market is still experiencing a limited supply of listings. Our current level of listings is over 50% less than the number of listings in 2019. While we anticipate listings to continue to increase, there is a long way to go to reach a “balanced” market.

The level of activity and price appreciation the past few years was an anomaly created by a perfect storm of economic and demographic conditions. A return back to “normal” is healthy for our overall real estate market. Pundits seem to be clamoring for a crash like we experienced during the housing crisis of the Great Recession. Fortunately, the foundation of our local housing market is on much stronger footing with close to 50% of sales being paid in cash. The remaining financed buyers are doing so with stringent underwriting guidelines and significantly more down payments (“skin in the game”).

The country is experiencing a record level of equity in their homes and as a result, the anticipated flood of foreclosures has not materialized. With builders still struggling with supply chain challenges and increased prices, they are reluctant to grow their inventory of new homes. All of these factors will continue to limit the supply of available homes for sale and continue the imbalance between supply and demand for the near term.

Presented by
Larry Brzostek, CRS, CLHMS
Broker Associate
RE/MAX Alliance Group
Call or Text: 941-993-3125
Web: LarrySellsSarasota.com

10 Red Flags to look for when buying a home

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On April 19, 2022

In Home Buying

10 Red Flags to look for when buying a home
10 Red Flags to look for when buying a home

10 Red Flags to look for when buying a home

Too Much Scent – Could be masking offensive odors.

Wonky Windows – Can signal issue with foundation or poorly installed. Pricy to fix /repair.

Poor Tiling – Bad DIY tiling can cost a lot to re-do.

Mold – Inspect bathroom and sinks for small black or gray spots.

Foundation issues – Tip Offs: Large gaps, sticking doors or windows, cracks, uneven floors.

Water Damage – Musty odor is an indicator. Check walls & ceilings for waterlines.

Poor Maintenance – Can indicate seller ignored other ongoing issues.

Cosmetic Updates – Could have been added to hide deal breakers.

Nearby water – Higher chance of flooding.

Bad Ventilation – Allows moisture to stick around, creating mold.

Source: Realtor.com – Courtesy of Residential Real Estate Council

Have a Great Day!

As always, for all your Real Estate needs in the Sarasota Area
Call or Text Larry @ 941-993-3125
or
Go to Larry’s RE/MAX Site and search all you like LarrySellsSarasota.com

5 Hidden Costs of Homebuying

By

On February 22, 2022

In Home Buying

Ready to Buy?
Top expenses to factor into your purchase.

Infograph
5 Hidden Costs of Homebuying

HIDDEN COSTS OF HOME BUYING

44% OF HOME BUYERS report they weren’t aware of all the costs associated with buying a home.
Top expenses that new home buyers sometimes forget to factor in:

CLOSING COSTS
These range between 2% to 5% of the loan amount. The national average is about $6,000.

HOME INSPECTIONS
These typically run from $300 to upward of $600 depending on the location and size of the home.

TITLE INSURANCE
The average cost of title insurance is around $1,000 per policy, but that amount varies widely from state to state and depends on the price of your home.

POTENTIAL RENOVATIONS
A 2017 survey found that new homeowners spent
an average of $10,601 on furniture, appliances, and home repairs — in the first year.

MOVING COSTS
The national average cost of moving is about $1,400 with a range from $800 to $2,150. (That’s for a two-person moving team completing a local move of less than 100 miles. The average cost of a long-distance move: between $2,200 and $5,700.)

SOURCES: Realtor.com, Forbes, National Association of Home builders

Have a Great Day!

As always, for all your Real Estate needs in the Sarasota Area
Call or Text Larry @ 941-993-3125
or
Go to Larry’s RE/MAX Site and search all you like LarrySellsSarasota.com

Florida Homestead Exemption

By

On December 21, 2021

In Florida Homestead Exemption, Home Buying

Are you a permanent Florida Resident and homeowner?

If you are, have you filed for the Florida Homestead Exemption?

Decorative Image
Sold by Larry Brzostek

Hi, I’m Larry Brzostek with RE/MAX Alliance Group. I can walk you through what the Homestead Exemption is and why it matters to you.

What is the Florida Homestead Exemption?

As a permanent Florida Resident and homeowner, you are entitled to get a homestead exemption on your primary residence.
The exemption is a $50,000 reduction of the assessed value of your home which determines your property taxes.

What are the eligibility requirements for the Homestead Exemption?

To be eligible for the Homestead Exemption your home must be your primary residence as of January 1 in the year you are filing. If you rented the property in the previous year, you only could have done so for a maximum of 30 days.

When should I file an application for a homestead exemption?

Your application must be filed between January 1 and March 1. The March 1st deadline is in year you are filing.
You can file online in Sarasota County using the Sarasota Appraiser’s site
https://www.sc-pa.com and look under Exemptions. If the property you are homesteading is in another county, look under that county’s appraiser site.

What documentation do I need to file for the homestead exemption?

All documentation must show your permanent residence address.
You will need:
• Valid Florida Driver License or Valid Florida Identification card with the ID number and issue date.
• Florida Vehicle registration (if vehicle owner) with tag number and issue date.
• Voter registration (if registered voter) with ID number and issue date.

If you are not a citizen, you will need your Permanent Resident Alien Card with ID number and issue date.
(Also, you must submit a copy will be as part of the exemption application).

What other information is on the exemption application?

You will also have to provide the following:
• Date of birth
• Social Security Number (if you are married, you will also be required to provide your spouse’s SSN)
• Date you purchased the property
• Date you occupied the property
• Address of previous residence
• Address of other property or properties owned
• Telephone number
• Employment information (if applicable)
• Mailing address listed in last IRS tax return

Married couples filing for homestead exemption must complete the application during the same application session. If you are married AND your spouse is NOT filing for homestead exemption, you will be asked to provide the following information:

• Name of spouse
• Spouse’s Social Security Number
• Spouse’s Date of birth
• Spouse’s Florida Driver License or Florida Identification Card number (if applicable)
• Spouse’s primary residence address & residency-based exemptions/discount information

In addition to the homestead benefit the Save Our Homes (SOH) cap was established in 1995 according to Florida Statutes. The SOH cap is placed on the Assessed Value the year after the property receives a Homestead Exemption and is based on the lower of the following:

Three percent of the Assessed Value of the property for the prior year, or the percentage change in the Consumer Price Index (CPI) as reported by the U.S. Department of Labor, Bureau of Labor Statistics. This means your taxes will not increase by more than 3% in any given year.

In 2008 a constitutional amendment was passed adding portability of the exemption; allowing some or all of the exemption to be transferred to another home. Very beneficial to a homeowner who trades up to a larger home or one who downsizes to a smaller one.


Do you qualify for additional homestead exemptions in Sarasota?

To find out if you qualify for additional homestead exemptions,
Contact the Property Appraiser’s office in the county that your property is located.

Hopefully this information will help you. Happy homesteading!

For more information Call or Text me @941-993-3125
And Checkout my Website
LarrySellsSarasota.com

Tips for Buying a Vacation or Second Home

By

On October 20, 2021

In Buying a Vacation or Second Home

Location! Location! Location!
Sarasota, Florida is accessible, close to airports and major highways.
It is one of the most beautiful locations in the USA. Magnificent Beaches, Arts and Entertainment are all here in this Paradise on the Gulf Coast!

I’m Larry Brzostek a Broker/Associate with Re/MAX Alliance Group and I will guide you through the process.

Types of Property
A second home can be a single family home, a condominium or a multifamily with 2 or more units (adding the possibility of rental income
Each type of property has its own pros and cons.
Consider carefully how you will use the property. If you like to work on your home, choose a single or multi-family.
If you prefer all maintenance to be done for you, then a condominium with a monthly maintenance fee
Deciding what you like and how you will use it should give you direction in your search.

  1. Consider how you’ll use the home. Will it just be for family and friends, or do you plan to rent it as well? And realistically, how many times will you use it per year?
  2. Evaluate locations. Are there enough amenities and attractions to keep you – and renters – coming back year after year?
    Local building and zoning codes should be investigated.
    Are they restrictive or nonexistent?
    Does the property conform to the codes and can the property be rebuilt in event of damage.
    These are important questions.

Availability and Inventory
In this fast changing Real Estate Market it is important to know what homes are available.
Its is also important to Get prequalified (a loan approval for a certain dollar based on finding an acceptable property) cuts down on the closing time.

Negotiating
Once you have found the property that suits your needs, negotiating the transaction can make it yours.
The more questions you ask (and get answers to) the more able you are to sketch out an offer that will be acceptable to the seller.
Every real estate transaction has 3 elements – Price, Terms. and Conditions.
Neither buyer nor seller always gets all three.
For example, a buyer willing to meet the seller’s price might want concessions on the terms (ex. large mortgage contingency, later closing) and/or conditions (repairs to property, extra items included).
How long a property is on the market is not confidential and may give you some insight to make a win-win proposal for both parties.

Financing and Tax Considerations
Talk to your accountant or financial advisor
This person can advise you on such issues as the tax implications of rental income (should you decide to rent your property and changes in Federal tax laws that could impact deductions.

Working with an Agent
I am a professional Real Estate agent and make my living marketing and selling properties.

Knowledge:
Knowing the Comps (comparable properties that are listed and more importantly, comparable properties that have recently sold) can be critical in your decision on the offer you make on the property.

Experience:
I’ve been selling second homes and vacation properties since 1986 starting on Long Beach Island, NJ and Here in Sarasota, FL since 2005.

Dependability:
I am always available to meet the needs of my clients
No location or town is perfect; a successful agent knows the pluses and minuses of the area. A good agent can help you find your dream house; a great agent can make it a pleasure!

Service:
Expect outstanding service and GET IT!

Check out my website LarrySellsSarasota.com
Look around you can search for properties and find more information about Sarasota and much more

CONGRATULATIONS!
You are a Second Home Owner

For more information Call or Text me @941-993-3125

And again I invite you to checkout my website
LarrySellsSarasota.com

Have a Great Day!

Larry Brzostek, CRS, CLHMS
RE/MAX Alliance Group, Sarasota, FL

Why do I need title insurance?

By

On September 1, 2021

In Home Buying, Information

by Peter Crowley, President of RE/MAX Alliance Group

Peter Crowley, President RE/MAX Alliance Group
Peter Crowley, President RE/MAX Alliance Group

As a co-owner of a local title company, we are often asked, “Why do I need title insurance?” Depending on your circumstance, the answer may vary. As with most forms of insurance policies, no one is typically thrilled to pay for something that you hope that you never have to use. Unlike your homeowner’s insurance or car insurance, however, title insurance is a one time charge that will provide protection for as long as you own your home.

If you are financing your home, your lender will require a lender’s title policy to insure that their security interest in your property (the mortgage) is in superior position to anyone else that may claim an interest in your property. The amount of the coverage for the lender’s policy is the amount of the outstanding mortgage principal. When purchasing a home with a mortgage, because you are already paying for a lender’s title policy, the additional cost for an owner’s title policy is only slightly more and it just makes sense to include the owner’s policy – so that you are covered. The lender’s policy alone does not give you as the owner any coverage.

Prior to closing on the sale and financing of your home, the company conducting the closing will search the public records to discover any liens (public or private), encumbrances (outstanding mortgages or restrictive covenants from a condo or homeowners association) or easements (utility or other agreements to use your property). If there are any issues they may create a cloud on title, which typically must be resolved prior to closing.

Since our local market has a large amount of cash closings, we are often asked, “If I am not getting a mortgage, then why do I need to pay for title insurance?” In this case, an owner’s title policy will protect the owner for similar undiscovered liens or encumbrances that may impact the owner’s ability to use their property as they intended. The amount of coverage for an owner’s title policy is typically the purchase price of the home. In some cases, such as a fraudulent transfer, the owner’s title policy would protect them from the economic loss of not being able to occupy the property. Without an owner’s title policy, your only recourse in the event that a title defect is discovered would be to sue the seller/grantor based upon the warranty deed that you were provided at the time of your purchase/closing. However, if that seller/grantor is deceased, or cannot be located, or does not have the assets to compensate you for any loss you may have suffered, you would be left without a remedy (unless you have title insurance).

We would like to thank our guest author Peter Crowley
Larry and Ann Brzostek

As always, for all your Real Estate needs in the Sarasota Area
Call or Text Larry @ 941-993-3125
or
Go to Larry’s RE/MAX Site and search all you like LarrySellsSarasota.com

Will high construction costs persist?

By

On July 6, 2021

In Home Buying, Information, Real Estate

by Peter Crowley, President of RE/MAX Alliance Group

Peter Crowley
Peter Crowley, Broker/Owner RE/MAX Alliance Group

It has been well documented that the costs for supplies for new construction have risen steadily since the pandemic – a simple function of supply and demand impacting the cost of steel, concrete, and most importantly, lumber. These escalating costs have forced several builders to stop or significantly reduce the number of homes that they are producing for fear of absorbing those increases and eroding their profit margins.

The reason for this imbalance in supply and demand, particularly with lumber, is a congruence of factors. Many lumber mills were forced to shut down their factories at the onset of the pandemic. Furthermore, as mills began to open, the industry underestimated the intense demand stemming from both the home improvement projects spurred on by being “locked” inside for months, as well as resurging demand in new homes for people looking to relocate or upgrade in the post-pandemic economy. This imbalance of supply and demand has led lumber prices to reach a peak of over $1600 per thousand board feet in early May (as a point of reference, the price was less than $400 per thousand board feet a year ago). As lumber suppliers woke up to the increased demand, they have been slow to respond with an increase in production due to the far-reaching labor shortages brought about by the pandemic.

There seems to be a light at the end of the tunnel, however. As more workers return to the mills and the mills begin to operate at full capacity, the production of lumber is gradually picking up pace. Furthermore, some of the demand from stimulus driven remodeling projects has dampened, thus bringing the supply and demand curve closer to some semblance of normal. The previously mentioned pause by many home builders is also loosening up the demand for lumber. The result is a dramatic drop in the lumber futures market, which has tumbled more than 45% (closing just below 900 on June 18). While lumber is the most dramatic example of this increase in supply, most of the other materials and components of new construction are following a similar trend.

Does this mean new home prices are going to come crashing down and buyers should wait? Not so fast. What it hopefully means is that builders will be able to resume a more “normal” pace of construction to start to fill the huge gap of new home units needed to keep up with the current level of demand – by some estimations the nation is lacking more than 3 million homes to satisfy demand. The additional supply of new homes is necessary to supplement the anemic existing home inventory to merely keep up with the existing level of demand.

What is significant about the rapid decline in the lumber futures market is the possibility that the inflation pressures that we have experienced recently (the Consumer Price Index rose by 5% – the fastest pace in 13 years) are only temporary because of these wild fluctuations in materials costs brought on by the pandemic. This seems to be the basis of the Federal Reserve’s stance to keep interest rates low – citing these as temporary inflationary pressures rather than permanent.

The coming months will be telling to determine if these fluctuations in prices were indeed driven by supply challenges brought on by the pandemic. If so, we should expect to see a stabilization in the cost of new construction and renewed confidence by the building industry to resume a normal level of housing construction. A more modest inflationary environment should also lead to a more sustained economic recovery, which is welcome news as we approach our new normal.

We would like to thank our guest author Peter Crowley
Larry and Ann Brzostek

As always, for all your Real Estate needs in the Sarasota Area
Call or Text Larry @ 941-993-3125
or
Go to Larry’s RE/MAX Site and search all you like LarrySellsSarasota.com

7 Tips for a Smooth Move

By

On July 5, 2021

In Home Buying, Information, Real Estate

Memorial Day to Labor Day is peak moving season with more than 65% of relocations happening during the summer months. Take the stress out of your move with these tips from the Professional Movers Association of Florida.

Seven tips for a Smooth Move
7 Tips for a Smooth Move
  1. Plan your move in advance so you have time to evaluate your options, and make a decision based on overall value (quality low stress move, insurance/valuation to protect your move).
  2. Confirm that each mover considered carries commercial general liability insurance, automobile liability, cargo liability and workers’ compensation. This can be verified by a certificate of insurance.
  3. Check if the moving company is licensed by Florida Department of Agriculture and Consumer Services by visiting floridaconsumerhelp.com.
  4. Get a written estimate from several movers and compare them. The estimate should be based on an actual in-person or virtual inspection of your household goods. Estimates and Contract for Services must include:
    – Name, telephone number, physical address and state registration number of the mover.
    – Date the contract or estimate was prepared and proposed date of the actual move.
    – Appropriate pickup and delivery address, name and telephone numbers of the shipper.
    – Name, telephone number and physical address where the goods will be held, if necessary.
    – Itemized breakdown, description and total of all costs and services provided.
    – Acceptable forms of payment available.
  5. Determine if the company is a moving broker or moving company. A broker arranges for the transport of your household goods for a fee and sells your move to a moving company – which significantly reduces a consumer’s available funds for the actual cost of the relocation services. Often, the consumer is not aware their move is being sold to another company.
  6. Check your homeowners or rental insurance policies for moving coverage.
  7. Accidents happen, even with the best movers. Discuss valuation with your mover; know the difference between released value at 60 cents per pound and full value protection.

Source: Florida Realtor magazine

Have a Great Day!
Larry and Ann

As always, for all your Real Estate needs, call or text Larry @ 941-993-3125
or
Go to Larry’s RE/MAX Site and search all you like LarrySellsSarasota.com

Let the pros help you navigate multiple offer scenario

By

On July 1, 2021

In Home Buying, Real Estate

It is critical to align yourself with experienced loan officers and real estate professionals to help prepare you to be in the best position possible to win a multiple offer scenario.

by Peter Crowley, President of RE/MAX Alliance Group

Peter Crowley, President RE/MAX Alliance Group
Peter Crowley, President RE/MAX Alliance Group

By now, you would have to be living under a rock not to have heard about the intensely competitive real estate market throughout our local market. This seller’s market is not limited to Southwest Florida, but rather the entire country is experiencing the challenge of a limited supply of homes against swelling buyer demand. If you are an active buyer in today’s real estate market, you have likely experienced the frustration of losing out in a multiple offer situation on your potential dream home. All hope is not lost, however, if you equip yourself with some knowledge, persistence and patience.

It should come as no surprise that “cash is king” in a competitive multiple offer situation. Because of the larger percentage of second home and vacation home purchases in our local market, cash has always been a more prominent factor compared to the national average. This has been exacerbated by new entrants into the market – institutional investors backed often by Wall Street investment funds. Often referred to as “iBuyers,” these institutional investors are looking to capitalize on both the increase in home prices as well as the strong rental market for residential homes. To give one example of the increased competition brought on by these institutional investors, an entire newly built community in the Tampa Bay area consisting of about 50 homes was purchased in bulk by an institutional investor who plans on renting the homes, thus eliminating the consumer/purchaser all together.

If financing is a requirement for your home purchase, you must be more prepared than ever when entering this competitive real estate market. Now, more than ever, it is critical to align yourself with experienced loan officers and real estate professionals to help prepare you to be in the best position possible to win a multiple offer scenario. Whenever possible, it is helpful to get a full financing pre-approval on the specific property to demonstrate your ability to follow through on the purchase. An increasingly effective tool to compete with cash offers is the addition of an Appraisal Gap Addendum which states that the buyer has the financial means to cover the difference between the appraisal on the property and the actual purchase price.

Whether you are financing or paying in cash, there are a few more important factors to consider to position your offer most favorably. Escalation clauses – where buyers agree to incrementally increase their offer to beat out competing bids – are almost commonplace in this competitive environment. In addition, providing flexibility to the seller in the occupancy of the home (sometimes in the form of a post occupancy agreement) gives the seller additional time and peace of mind to know they have time to find their replacement home. Furthermore, while it is never advisable to forgo a home inspection all together, most buyers are offering to purchase the home as is and take on any responsibility for repair costs. Finally, offering to pay the seller’s closing costs can be another incentive to allow your offer to stand out above the rest.

Through the help of an experienced Realtor®, buyers can navigate through this competitive real estate market to position themselves in the best way possible to successfully purchase their new home. Setting the right expectations and preparing yourself to put your best foot forward in a multiple officer scenario will lead to an accepted offer on your new home. Always remember, “if at first you don’t succeed, try, try and try again.” Your dream home awaits.

We would like to thank our guest author Peter Crowley
Larry and Ann Brzostek

As always, for all your Real Estate needs in the Sarasota Area
Call or Text Larry @ 941-993-3125
or
Go to Larry’s RE/MAX Site and search all you like LarrySellsSarasota.com

Home Buying – Secrets for a Stress Free Transaction

By

On June 23, 2021

In Home Buying, Real Estate

Source: Courtesy of Breakthrough Broker

Home Buying - Secrets for a Stress Free Transaction
Home Buying – Secrets for a Stress Free Transaction

Lay Groundwork
Discuss the type of home you are looking for including style, price and location.

Work with an Agent
I will guide you through the process every step of the way. The Seller usually pays the real estate commission for their agent and the buyer’s agent. I will be there to help you succeed.

Communicate
Ask questions if something is confusing ask about it before you sign.
Be direct with your team and speak up if you don’t like something.

Be Flexible
Circumstances always change. Besides your financial capabilities almost everything else is beyond your control.
Any Questions? Call or Text me @ 941.993.3125

Have a Great Day!
Larry

As always, for all your Real Estate needs, call or text Larry @ 941-993-3125
or
Go to Larry’s RE/MAX Site and search all you like LarrySellsSarasota.com

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