This week Sarasota Real Estate Pro Marc R. guest blogs on his experience navigating this market. If you have arrived looking for Rancho Palos Verdes Foreclosures please visit our Palos Verdes Foreclosure page.
By: Marc Rasmussen – Sarasota FL real estate
No, you have not.
“Foreclosure!”, “Short sale!”, “Smokin hot deal!” These are the buzz words in today’s real estate market. It is hard to read a news article about real estate and not see some reference to distressed sales. That is understandable since it is a national problem from the popping of the housing bubble.
Realtors joke about how we hear these words from virtually every single home buyer. There is nothing wrong with this. If you are in the market to buy a home you should be looking for a great deal. If you aren’t then something is wrong.
However, expectations of today’s home buyers need to be realistic. Despite a challenging real estate market properties are selling. Properly priced homes for sale in Sarasota see plenty of action. I have several buyers that have made offers on bank owned homes only to lose them to other buyers. A home priced right will see very little discount from asking price, if any. Some sell for more than list price. It is great to see a liquid and efficient housing market. If a home comes on the market that is under-priced it usually sees multiple offers the first day. That is a sign of a relatively healthy housing market. If you put a home on the market that used to sell for $200,000 for $20,000 and you get no action then you probably have bigger problems to worry about.
Many buyers start their search with the notion that they are going to get a huge discount from list price. Real estate is local so figures are different city by city but the average discount in Sarasota, Florida is hovering around 5% from list price. I suspect the same for many other areas of the country. Ask your Realtor what this statistic is in your area.
Managing these expectations could save you a bunch of time, aggravation and headache. If your average discount is 5% and you can afford a $300,000 home then you probably should not be looking at homes priced at $500,000.
Some buyers have been waiting on the sidelines for “the bottom”. No one knows for sure if the market has bottomed or not. Again, it will depend on your particular area. Some buyers are worried that they missed the boat in finding a great deal. That is not true. Most real estate markets across the country have not started appreciating.
A Bigger Problem
Have you missed the ultimate bottom? Maybe. Have you lost out on a bunch of money by missing this bottom? No. There is one thing you do need to worry about. You may not be able to find a home you actually like. You are losing your options. This means you cannot be as picky.
Many Sarasota home buyers can’t find a home they like. As the market corrects fewer and fewer homes will come on the market. The only way the market can bottom is with lower inventory. We need more and aggressive buying then we do selling and that is when you will start see home prices rise again. If you are a super picky buyer you may have trouble finding a suitable home.
Like stocks you are most likely not going to pick the absolute bottom of the real estate market. But, you don’t need to. You just have to get close. If you believe we are close to the bottom then you need to start looking for a home because as it looks now you will have fewer and fewer options as time goes on.