Spring Real Estate Solutions | Real Estate
This is the Treu Real Estate 911 podcast with Lisa Treu. Lisa will share up to date real estate information with you that you need to know.
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Brian Mudd:
Welcome to Treu Real Estate 911. This is Brian Mudd, and along with, of course, your local real estate pro Lisa Treu in a changing market that requires precision, good information, and solutions because oh my gosh are there excuses out there, and to through all of Palm Beach County's information, Lisa is going to make sense of it all, and tell you what you need to consider, whether you're thinking about buying or selling right now.
Brian Mudd:
Before we get started, if you're not already at treurealestate911.com, go there. You'll see why as soon as you get there. The best local resource you're going to find for real estate information, including the ability to search the MLS in real time just like the real estate pros do, and the Treus, they're always ready to help you. If you are buying, if you are selling, if you just have questions, Treu is a resource at (561) 972-8326, (561) 972-8326.
Brian Mudd:
Well, they say it's funny, as I take a look at the information, the latest real estate information from the Palm Beaches because on one hand, we see a market here that looks sluggish. On the other hand, talking to you, oh my gosh, you're about as busy as possibly can be, so it seems like there are solutions out there in Palm Beach County's real estate.
Lisa Treu:
I was meeting with one of our great partners the other day. He was telling me how he was hearing how busy everybody was in January and February in the real estate market, and now everybody is dead. Honestly, Steve and I can barely breathe we're so busy. We're grateful for that. We're putting properties under contract. We have new properties coming on the market. We are working with buyers both local, which we expect this time of year, but also still those out-of-state buyers both looking for year round homes and their seasonal products for next year.
Brian Mudd:
Now Lisa, when I'm taking a look at any real estate market before I get concerned there are two types of clients that I'm looking for before digging any deeper. One is, an overall decline in sales activity. And then the other, prices that are down alongside those sales. Now, we came close to that, but we still end up showing a price appreciation with the median sales price.
Brian Mudd:
If we take a look at what happened in Palm Beach County, single family homes in March, nearly a 9% drop in sales, but prices up just under 1%. What's your overall perspective as you take a look at the health of the local real estate market?
Lisa Treu:
I think that the market is still good for those people that get the formula right. The seller who says, "I want a certain price because I want it," is just sitting on the market. I'm not talking about sitting a month or two. They are sitting month, after month, after month, and they're having no success.
Lisa Treu:
The other thing that I'm seeing, and I'm having many listeners calling me, after they're in committed long term contracts saying what's wrong, I pull up their listing and I'm seeing marketing major mistakes, which definitely impacts the ability to sell the property, and certainly sell it for the most money.
Brian Mudd:
You talk about the listings that are not priced well, and not marketed well. It's an ongoing condition. But, what I hear you saying, here we are in a mature real estate market, so you have to get things right. But, the mistakes that maybe you could get away with in years previous, you're simply not going to get away with in today's market.
Lisa Treu:
You're not going to get away with it today. You have to have everything perfect. And when everything is still perfect, it takes skill and expertise to get the property sold. It's just not that easy. It's one of the reasons why the failure rate in our industry is so high. I mean 83% of new agents fail in this because this is not easy. This is one of the most complicated things to get right, especially in this market.
Brian Mudd:
Yeah, I mean you talk about that. I think the average person doesn't realize that four homes are sold per real estate agent per year on average. When you're talking about the kind of volume that you're doing to be over 100 per year that takes incredible talent, and skill, and positioning.
Lisa Treu:
It does. It takes giving it everything. I mean we have a team word that we all embrace and it's committed, and that means that there is nothing we won't do, nothing we won't say, and nowhere we won't go to help our clients achieve their goal. Then, in this world, sadly, we have to say as long as it's legal and moral, but we are going to give everything we can to help our clients achieve their goals because that's what we commit to when we take a client on.
Brian Mudd:
Now Lisa, one bright spot in particular in the local real estate market you were telling us about a month ago, "Hey, you need to be on the market right now if you are a single family home and you're looking to take advantage of this summer season." We did see that homes between 4 to $600,000 did have a pretty good run in March.
Lisa Treu:
We did. It's one of the good news stats in the market is that it has dropped back down into that barely seller market criteria. We're at five months of inventory based on the number of properties, and the number of properties that went under contract when we're talking from 4 to 600,000, which we haven't seen for a while, so it's definitely what we've been saying, which is it's the perfect time to benefit if you have that type of property.
Brian Mudd:
Where are the opportunities in this market for buyers and for sellers?
Lisa Treu:
Well first of all, the number one opportunity is any buyer whose entering the marketplace the very first time, so if you are renting you need to be buying. We have been doing different events, sharing the new about that in seven years of owning versus renting the same type of property, the net gain, and it's a very conservative analysis, is in the 80 to $90,000 range in seven years from owning versus renting, number one.
Lisa Treu:
Number two, the opportunity is, we've been saying this a while, but the move up buys, so if you are selling in the 4 to 6, and then moving up in the 6 to over a million, you're going from a seller's market into a buyer's market, which is means more choices, more options, and often better deals.
Brian Mudd:
Lisa, seeing that there is a decline in overall cash transactions, under a third of the transactions that were all cash for the first time in a while, how interest rate sensitive has our local real estate market become as cash has been less of a factor?
Lisa Treu:
Well, it's not so much interest rate sensitive, what it is, is appraisal sensitive.
Brian Mudd:
Okay.
Lisa Treu:
One of the things that sellers sometimes forget is, when we're dealing with mortgages and when we're dealing with lenders, the lender is going to protect themselves against, "I just want any price possible." Even if the buyer is willing to pay it, the lender has to get behind it. The appraisal many times is the challenge when you start getting, even in some of these markets where it's maybe a hot sellers market, it has to appraise. The buyer needs the loan. Let's face it, the lender is going to protect their investment as they should, so when we're in the two and three months hot, hot seller's market, appraisals often are the deciding factor rather that deal can actually get to the closing table or not.
Brian Mudd:
Lisa, you're always a good indication of what's going on, on the ground right now. When we take a look at this information we're talking about, it's obviously information that's already happened. It paints a decent picture, but we know things can change quickly.
Brian Mudd:
A month ago when you were telling us, "Hey, if you're on the market right now and you're a single family home looking for the Summer season, this is what needs to be happening," you were dead on the money. We now see it in the information. What is going on in real time in our local real estate market that might end up being an opportunity for somebody?
Lisa Treu:
Well, if you have been thinking of selling, so for example, you're facing retirement. You have maybe a desire to move out-of-state. If you have something that you can see is going to cause your lifestyle to change, maybe you're going to get married and you need a bigger home, or you're expanding your family, you need a bigger home, this is the time to give us a call and have the discussion of what makes sense for me because it's great to say now is the right time. It doesn't mean that, that's the right time for you, and so calling us and having those conversations.
Lisa Treu:
We're having a lot of people that might have waited a few months later, go ahead and sell and take advantage of the Spring selling season right now because they understand what happened to the inventory. And if, you are sitting there going, "Well, I might want to sell in the next month, or six months, or 12 months," give me a call and let's discuss why and what makes sense for you, and then put the plan in place.
Brian Mudd:
Something else that crosses my mind, Lisa, I want to see if there is any indication that this is transpiring into results with more interest. We know that when the tax law changed we had added interest from high tax states. It created further emphasis for people that would be limited with their state deductions to take a look at Florida. Now, we had with tax season wrapping up, a lot of confusion.
Brian Mudd:
I was taking a look at percentages north of 50% with people that had outcomes that were different than what they'd realized they would be, and the one group of people in particular that fared the worst on average, during the course of tax season, those that are upper income earners from high tax states. Since the end of tax season, have you noticed any increased interest from those types of buyers from places like New York, and New Jersey, and Connecticut?
Lisa Treu:
We have not seen as many. Now, they have definitely started looking on our site. Many of them have purchased, but we have not seen as many as we expected. And yet, it makes sense, Brian, because if you think about it most of the people in those higher tax brackets they have to make transitions and plans. They have maybe a new career, or they need to relocate a business, or they have schools to deal with, so I believe that we are still in that transition period.
Brian Mudd:
Okay.
Lisa Treu:
I think we'll see that over the next year or two, but it wasn't the mass exodus that we had hoped for here in South Florida, and yet, I don't think it's over.
Brian Mudd:
Yeah, it makes sense. You do have the family considerations, life considerations, and then also you have to sell your home up there too, and that will end up playing a role for many I'm sure. All right.
Brian Mudd:
When we take a look at this information, we're talking about the opportunity was the 4 to $600,000 range, you're talking about those first time home buyers. You've mentioned the move up buying the luxury side. We continue to see that on the luxury end in particular, it is a really challenged market where we're up to what, closing in on two years for the average home over a million dollars to get sold.
Lisa Treu:
We're at 17 months right now. These are single family homes, and when you factor in the condo market those numbers get even larger. Ultra luxury is doing great right now.
Brian Mudd:
What's ultra luxury?
Lisa Treu:
Well, I consider ultra luxury anything over five million. That product is going. There is new construction going that's selling. There is beautiful new construction options for people looking for brand new condos in Palm Beach and Manalapan. And yet, the challenge really comes in that more 9 to 2 million range where, let's face it, there is only so many people, and changes matter to them a lot more in the economy, or in our real estate market. The move up buys sometimes slows down when inventory starts to grow, so it's just getting that formula right.
Lisa Treu:
I will tell you they are probably the seller who needs to pay the most attention to getting the formula right. There is an assumption that if you hire a specific luxury company that your home is going to get sold, and that just is not true. You're hiring the agent. I touch every single property we list rather it's a $100,000, or it's 10 million, I am the creator of marketing. It is my passion. It's what I love, and honestly, I'm great at it, if I do say so myself because I am passionate about getting the right people to see the right property.
Brian Mudd:
I like to say there are two sides to the stories, and one side to the facts, and the facts speak for themselves that the results be obtained. To your point, I have seen multiple properties that have gone through about an agent a year not getting sold over the past few years, and still going through that process. That so many people just go along with, "Oh, this is supposed to be the area expert for luxury homes," not necessary what's required to get the job done. This is all interesting and good information. Anything else that people should be thinking about? As we are now talking about, May will be here, hurricane season before we know it. Final thoughts?
Lisa Treu:
Well, if you have an active adult community property it's not too late. We are putting those under contract right now. We still have people from the Northeast coming down specifically to buy for next season, believe it or not.
Brian Mudd:
Okay.
Lisa Treu:
The other thing is, if you are in a business where you have clients that need our help... We just closed on a property that had been on the market with another agent for months, and months, and months. A past client of ours who's her financial CPA said, "Call Lisa, she can help." We listed the property, sold it, had it under contract very, very quickly, and we have new friends even though I'd never met these sellers.
Lisa Treu:
If you're a CPA, if you're an attorney, if you're an estate attorney, a divorce attorney, we want to make your life and job easier, and also your client's experience better. Call me. Let's connect. Let's see how we can help you get the results your clients deserve.
Brian Mudd:
And that number, it's (561) 972-8326, (561) 972-8326. And if you're not already there well go to treurealestate911.com. We'll see you next time.