Cape Coral real estate update (for sale by owner, foreclosures, rentals)

[nhkev]

These threads usually go on for awhile and inevitably get shut down because they turn into debates and rants rather than information.

please keep information "local" to southwest florida/ lee county

After a good summer of maintaining low inventory numbers Cape coral single family inventories have recently had an increase of 20%.

This seems to be contrary to what we are hearing nationally regarding inventories being lower.

I don't know if this is a seasonal thing where owners are putting their houses on the market during snowbird season and taking them off during the summers. Or can this have something to do with the fiscal cliff and the likely potential of an increase in capital gains.

homeowners are exempt from capital gains if they have lived in a house as a primary residence 2 out of 5 yrs. Cape Coral and lee county during the bust had a problem with investors coming in and bulk purchasing properties renting them out. This was a temporary good for the area as it helped dry up inventories, provided rentals for many that were losing their homes, kept a lot of areas from blight due to abandoned properties.

Some believed this would create a future proble of a lot of these investors flooding the market with their properties when the prices rebounded so they could make a quick profit.

Although this has happened in small doses every month, because there were flippers. but the fact that the rentals were positive cash flow it was my belief that a true investor that was getting double digit yearly returns would be more likely to keep their cash cow rather than part with it.

I may change my opinion on this because for the last 3 yrs we have seen double digit appreciation in housing values in the area which is too fast too soon. When the investor has a chance to lock in those type of profits and see on the horizon that those profits are going to be divided between them and the gov't at a different rate it may have pushed some to sell sooner rather than later.

Personally I really thought long and hard about selling myself

The other thing I've seen as a bothersome sign is the backlog of foreclosures. during the height of the bust the backlog of foreclosures were climbling at an alarming rate. At one point there were about 2500 new foreclosures being filed every month and the backlog neared 28,000. Then foreclosures started to dwindle and the courts were able to not only handle what was coming in but were able to chip away at the backlog. Now we are averaging about 500 or so filings per month but yet the backlog is still climbing,(very little on a monthly basis) but over a yearly basis it is really begining to add up. What the heck is going on over at the courthouse when there is only 500 being filed and they can't handle them? Why is the county spending all sorts of money on all other projects when they can't staff a courthouse with temporary help that can be reduced when the numbers come down.

again this might just be a seasonal thing but if some of the realtors can shed some light on who is selling and why.

[Billythepokerkid]

Originally Posted by nhkev

These threads usually go on for awhile and inevitably get shut down because they turn into debates and rants rather than information.

please keep information "local" to southwest florida/ lee county

After a good summer of maintaining low inventory numbers Cape coral single family inventories have recently had an increase of 20%.

This seems to be contrary to what we are hearing nationally regarding inventories being lower.

I don't know if this is a seasonal thing where owners are putting their houses on the market during snowbird season and taking them off during the summers. Or can this have something to do with the fiscal cliff and the likely potential of an increase in capital gains.

homeowners are exempt from capital gains if they have lived in a house as a primary residence 2 out of 5 yrs. Cape Coral and lee county during the bust had a problem with investors coming in and bulk purchasing properties renting them out. This was a temporary good for the area as it helped dry up inventories, provided rentals for many that were losing their homes, kept a lot of areas from blight due to abandoned properties.

Some believed this would create a future proble of a lot of these investors flooding the market with their properties when the prices rebounded so they could make a quick profit.

Although this has happened in small doses every month, because there were flippers. but the fact that the rentals were positive cash flow it was my belief that a true investor that was getting double digit yearly returns would be more likely to keep their cash cow rather than part with it.

I may change my opinion on this because for the last 3 yrs we have seen double digit appreciation in housing values in the area which is too fast too soon. When the investor has a chance to lock in those type of profits and see on the horizon that those profits are going to be divided between them and the gov't at a different rate it may have pushed some to sell sooner rather than later.

Personally I really thought long and hard about selling myself

The other thing I've seen as a bothersome sign is the backlog of foreclosures. during the height of the bust the backlog of foreclosures were climbling at an alarming rate. At one point there were about 2500 new foreclosures being filed every month and the backlog neared 28,000. Then foreclosures started to dwindle and the courts were able to not only handle what was coming in but were able to chip away at the backlog. Now we are averaging about 500 or so filings per month but yet the backlog is still climbing,(very little on a monthly basis) but over a yearly basis it is really begining to add up. What the heck is going on over at the courthouse when there is only 500 being filed and they can't handle them? Why is the county spending all sorts of money on all other projects when they can't staff a courthouse with temporary help that can be reduced when the numbers come down.

again this might just be a seasonal thing but if some of the realtors can shed some light on who is selling and why.

I think the increase in inventory is due to a bunch of things. Banks know the summers are generally a slower time, therefore don't release as many foreclosures to the market when there are less potential buyers. Same goes for homeowners. Right now there are 3 houses on my block that went up for sale in the past 2 months or less, all of which are priced about 25% more than what the homes are actually worth and what someone should really pay. I believe that these people really have no plan on selling unless someone is willing to pay asking or pretty close to it. In both situations you have the winter population increase locally, plus the people up North that just have had enough of the cold and might start peeking at what is available for sale down here, these people are not even thinking Florida during the summer. As far back as I can remember the inventory always increases during the winter, even during the boom it increased exponentially. It's just your basic economics of supply and demand. 20% really isn't extreme, considering how much the population balloons this time of year. Builders also are to blame for the increase, they spend all summer getting brand new homes ready for the snowbirds and vacationers coming down in the winter. Also factor in the economic uncertainty next year and here we are.

[Izmack]

Originally Posted by Billythepokerkid

Right now there are 3 houses on my block that went up for sale in the past 2 months or less, all of which are priced about 25% more than what the homes are actually worth and what someone should really pay. I believe that these people really have no plan on selling unless someone is willing to pay asking or pretty close to it.

Same in my Yacht Club neighborhood. Off canal home just like ours with minor improvements went on the block today for 220. We paid 140 for ours on a triple lot 3 years ago. Believe me, we are watching that baby carefully! Even if they get 20% less than their asking, I'm looking at 24% appreciation potential!

[xoomer]

My un-scientific report:

I've been watching the local market for about two years (on Listingbook mainly), first looking for a home to buy and then, after I moved here, to see where the market was going. Overall, it seems to me that there are a lot fewer homes for sale in the type of property I have, pool/canal, than at any time over the last two years. Additionally, the prices are creeping up at a pretty good pace now averaging about $15-$20 more per sq ft than at the first of the year.

For what it's worth, two canal lots "for sale by owner" popped up for sale a couple of blocks from my house a few days ago but were sold within a week.

I have no idea how the complete overall picture in Cape Coral is going, but it seems to be upward in my particular niche.

[nhkev]

Originally Posted by xoomer

My un-scientific report:

I've been watching the local market for about two years (on Listingbook mainly), first looking for a home to buy and then, after I moved here, to see where the market was going. Overall, it seems to me that there are a lot fewer homes for sale in the type of property I have, pool/canal, than at any time over the last two years. Additionally, the prices are creeping up at a pretty good pace now averaging about $15-$20 more per sq ft than at the first of the year.

For what it's worth, two canal lots "for sale by owner" popped up for sale a couple of blocks from my house a few days ago but were sold within a week.

I have no idea how the complete overall picture in Cape Coral is going, but it seems to be upward in my particular niche.

Thanks for the input. Inventories by themselves are a meaningless number. If inventory was 500 homes and there were 100 monthly sales it would be an absorbtion rate of 5 months. If inventory was 1000 homes with 300 monthly sales then it would only be 3.3 months absorbed so in this example the higher inventory means a healthier market. I know that 1st and 2nd qtr are the two busiest for sales so an increase in inventories may not mean anything in relationship to the higher sales so i was curious if people were seeing sales as well as listings

[Chuck12020123]

I'm waiting for a viscous rant from "Equal", should have been here by now.

[nhkev]

Most of us are own his ignore list so i don't know if he can even see this thread

[Billythepokerkid]

Originally Posted by nhkev

Most of us are own his ignore list so i don't know if he can even see this thread

He ignores everyone that makes sense and then talks to the newbies and tries to persuade them to see it his way, fortunately for us he's to stupid to realize that although he can't see what we say, the other people can!

[hiknapster]

Originally Posted by Billythepokerkid

He ignores everyone that makes sense and then talks to the newbies and tries to persuade them to see it his way, fortunately for us he's to stupid to realize that although he can't see what we say, the other people can!

God, that is so true!

Kev, the FHA stopped fighting the banks about modification just before the election. That has put a lot of foreclosures that the feds were holding back onto the market. That's inside info. I watched the FHA not allow BofA to do anything with my home for TWO YEARS. In August the FHA said there could be no modification because it is too late. It should have been modified a year before. So...why wasn't it? It was just a harebrained excuse to hold then release so that the market wouldn't flood before the election. It was auctioned off - back to the bank - Oct 29. Even then, they didn't tell me to get out although I did. I walked away a month later but didn't hear anything from the bank to even bother moving.

Anecdotal info but I've heard the same types of scenarios from others. I've also read that the banks weren't modifying like they agreed but I watched FHA not care just before the election.

This relates to your area a bit. I think there were more foreclosure and earlier than the rest of the country but you may see an uptick in foreclosures.

Hope this helps anyone.

[equalrightsforeveryone]

This say it all. They created a bubble just like I said and sales plummeted in the second quarter.
When you have that much of a price increase and such low sales the market is being manipulated, end of story
This represents the worst sales ever