Wednesday, November 23, 2022 / by Cj Hays
High demand in the Emerald Coast real estate market has continued to drive sales in 2022. This puts sellers in a great position to sell their property in an active market and earn equity from their investment. Buyers still have the opportunity to purchase at fair prices and receive the benefits of lower interest rates.
Here are 10 tips to help both sellers and buyers in our current market.
1. First-time buyers: Get that starter home now
And we mean now! More than half of home sales nationwide in 2022 were expected to be to first-time buyers, and mostly to the millennials (19 to 34 years old). That means competition — and bidding wars — could become fierce for starter homes. There are many ‘starter’ homes in the Destin area that are coming on the market and can be purchased at great prices and with a little sweat equity, become amazing beach homes. Santa Rosa Beach and South Walton have seen a boom in new communities offering great homes and amenities. These communities are selling out fast and building equity quickly. Grabbing a home in one of these neighborhoods could turn out to be a great investment.
2. Sellers: Hire the right agent
Many times, the best investment a seller can make is time spent researching agents. A bad hire can cost sellers tens of thousands of dollars and months of worried waiting.
First, look at an agent’s online marketing material and listings. Is there good photography or video? Does it “pop”? Are descriptions accurate and complimentary without seeming exaggerated? Then, look at profiles of the agents on LinkedIn, Facebook and other social media; and be sure to read web reviews. What kind of vibe is an agent sending out?
Narrow your search to three agents and interview each, ideally in person. Ask for sales-activity reports, existing listings and time-on-the-market averages, plus the requisite local comps.
Here are a list of questions you can ask potential agents to better understand how they work and if they are a good fit for you and your property - Buyer Questions to Ask Any Agent.
3. Buyers: There’s more loan money out there
Those who couldn’t get mortgages during the downturn because they didn’t have 20 percent to put down can find affordable financing again. Borrowers with lower FICO scores are now getting conforming mortgage loans.
Our connections with great local mortgage companies means you’ll have a loan officer who truly understands our market and the nuances of Northwest Florida real estate. In addition, they offer great loan packages and can negotiate the best rate for your situation, including FHA, VA and rural loans.
4. Sellers: It may be a seller’s market but…
Sellers can do several simple things to enhance appearance, increase buyer interest and boost their property’s profile:
• Selective renovations: Instead of wholesale renovations from which sellers recoup maybe 60 percent on investment, do light makeovers everywhere, with an eye on the kitchen and bathrooms. They’re far more cost-effective.
• Clean, clean and clean some more: It’s hard for buyers to picture themselves living in a dirty house. Scrub floors, baths, kitchens, windows and walls, and be sure to clean, vacuum and deodorize rugs. This is simple but effective.
• Depersonalize, declutter: Show the space, not the contents. Box up family photos, kids’ school papers and excess art, and store bulky and worn furniture. Organize your closets to make them look half empty.
• Illuminate: Think bright and cheery. Open curtains and blinds and add brighter light bulbs in dark areas. Repaint where needed but use neutral colors.
5. Renters: It might be time to buy
In many cases, rents are rising faster than home values, yet mortgage rates remain low. That, and the fact that renters now account for 37 percent of households (the highest level in 50 years), seem to indicate an imminent coming-out party for renters-turned-buyers, especially if they plan to stay put for five to 10 years after buying.
Palms of Freeport, located just 15 miles from the Gulf of Mexico, is a perfect example where owning your home is better than renting. This is a great investment opportunity for full-time living or as a rental unit, and there are approximately 20 units left. Just across the street from Freeport Elementary and close to the new Publix and Hwy 331, Palms of Freeport offers a great, central location.
These desirable townhomes have been renting for $1,100 per month with 100% occupancy and a waiting list! Monthly mortgage payments, including HOA fees, taxes, and insurance are only approx. $990 a month.* Own for less than what you can rent for. The last unit sold for $135,500 and prices are scheduled to increase.
6. Buyers: If you’re a buyer, don’t believe the house is yours
Don’t bank on a done deal or other verbal promises from listing agents until you sign a contract. Remember, a verbal contract isn’t worth the paper it’s written on. Get it in writing or it doesn’t count!
In heated markets across the country, sales agents are giving buyers false hope and using their offers to bid up the price for preferred buyers who they think can pay more and close faster. Have other homes in mind.
Strategies such as preapproval (versus prequalification), proof of funding, closing flexibility and the always-risky practice of waiving inspection and repair contingencies can help sway buyers.
7. Sellers: The grass is always greener…
… in yards with a “sold” sign. Major interior or exterior upgrades typically aren’t needed, but a little attention outdoors is a must.
Surveys show that strong curb appeal can increase prices by 10 percent or more. Greener grass, whether derived from new sod or fertilizer and water, is a must. New shrubs, plantings and flowers also project a welcoming feel. Sellers typically enjoy a 100 percent return on the money they put into curb appeal.
Another form of green, sustainable landscaping has become a value-add for buyers. Native plants, native grasses and perennials that require less water and attention fill that bill. Especially with Florida weather, native plants than can withstand drought and months of downpours are enticing to buyers, and will help make the yard easier for you to maintain until you property sales.
Other outdoor cleaning like pressure washing, repainting doors and shutters and sprucing up lanai’s give buyers a great first impression for your property. For condo owners, make sure to clean your balcony and outdoor furniture. You can even ‘stage’ the balcony to make it more inviting.
8. Sellers and buyers: Know the state of your market
A balanced housing market is defined as one with an average inventory of 6.5 months, according to Texas A&M University Real Estate Center research. When inventory remains below equilibrium, sellers enjoy more control over prices and terms, and the area becomes a seller’s market.
When inventory lingers well above stasis, you have a buyer’s market where sellers must get more serious about price reductions, credits and throw-ins. Contact the Nathan Abbott Team to receive an updated market inventory for our local service areas, including Okaloosa Island, Destin, Miramar Beach, Santa Rosa Beach, Freeport and Panama City Beach.
9. Sellers: House going up for sale later in the year?
Do some prep work now. Grab your camera or smartphone and do an exterior photo shoot in the summer on a nice bright day with the landscaping freshly updated. Do the same thing in the fall as the plants in your landscape start to change.
This way, if your house goes on the market in the winter or early spring, you have photos showing how great it looks with all your landscaping blooming and grass green. It’s a much better way to showcase your home than to wait until late winter when everything is still dead and brown and mucky.
Take a preliminary inventory, too. Look through your attic, closets, basement and garage to see what stored items you’ll want to keep, give away or sell before listing your property. This will help you determine whether you’ll need a storage unit when your home is on the market and if there are any problem areas that need repairs or attention.
It’s also a good time to start discussing financing options with a local lender and interview prospective listing agents who also might provide additional preparation tips.
10. Buyers: Relocating near the Gulf of Bay?
If you’re wanting to buy a house or condo on the Gulf of Mexico or Choctawhatchee Bay, an important thing to consider is weather and insurance realities. Many homes in our local bay areas are required to have flood insurance. Gulf-front homes and condos also need special insurance that you may not be aware of.
Parts of Florida saw 20 percent increases in 2016 for insurance rates and could possibly see more as time goes on. Insurers also are imposing coverage caps so there’s no guarantee you’ll be made whole post-catastrophe.
Some home sellers and their agents are conveniently not disclosing these realities, so buyers will have to ask pointed questions and do their own research. We are here to help make sure all cost of ownership for a property is provided before you’re at the closing table. Contact Nathan Abbott with any questions about local properties and insurance requirements.