The Northeast Florida Real Estate Blog

I am sure all of you have been reading about the real estate market conditions today, and they certainly aren't good, at least if you listen to the media.  That is not to say that the media is reporting bad information - the fact is that listings are up, and sales are down.  There are plenty of sellers in the market and few buyers - which isn't a good thing.  Therefore, prices are dropping as sellers attempt to lure the few buyers that are out there looking at the many homes on the market today.  The market is also impacted by the increase in foreclosures which we've seen recently.  There are two types of situations we've seen out there which make up an the majority of the foreclosures.  One is the investor (speculator) that bought up houses with intent to "flip" them quickly and make some money.  As the market deteriorated, these investors were left holding one or more homes with little prospect of selling them, even at a break-even price.  The other type of foreclosure we've seen is the homeowner, usually a first-time buyer, that got into an adjustable rate mortgage, and usually one with pretty bad rates.  These inexperienced buyers never anticipated the rate increases as the mortgage adjusted and did not really plan for the extra money required to make the increased payment.  Unfortunately, in some cases, these buyers were disadvantaged by unscrupulous mortgage brokers who prey on inexperienced buyers and sell mortgage products which are good for the broker, but not for the buyer.

But, now that we've seen what has happened to the market, what can we do about it.  Well, if we are sellers, you can rethink selling until the market improves, or you can price the property a realistic level to sell in today's market.  The fact is, houses are selling today, but these are the houses that are priced for today's market, not last year's market.  Many sellers try to get the inflated price obtained by their neighbor in early 2006 - but buyers won't pay that price today.  Perhaps they'll return next year, or the next year, but if you're selling today, you've got to price it for today.  Your real estate professional can give you a free market analysis to determine your homes value today - just give them a call. 

Now, if you are a buyer, this is a great market.  You're like the most popular guy or girl in school - everyone wants to meet you and be your friend, particularly folks with houses to sell.  So, you are in the driver's seat.  Loan rates are great, so the mortgage is no problem.  Plus new programs are out there to help new, first-time homebuyers.  You can contact your real estate professional, a Realtor, who abides by the Code of Ethics of the National Association of Realtors (NAR).  Your Realtor can assist you in narrowing your search to a reasonable number of homes and you can then go look at each one, determining which ones are worthy of consideration.  Once you decide, in today's market you can offer a reasonable price and usually get it.  If the house is priced well, something your Realtor can tell you, then perhaps a full price offer is warranted, but there is also room to negotiate some incentives for the buyer, like having the seller pay a portion of the closing costs.  Bottom line, you can easily find a great house in today's market, even if you don't have perfect credit and are a first-time homebuyer.  In the end, you'll have a great home with a very reasonable mortgage rate - thanks to the current market, which while not great for some people, is perfect for others.