U.S. Offers Lower Prices for Luxury Real Estate

When looking at luxury real estate prices in the United States in comparison to luxury real estate prices in other nations across the globe, the United States offers some bargain options, according to recent research completed by Knight Frank, a global real estate consulting firm.  In fact, when Knight Frank ranked the top 5 percent of luxury real estate sales in 41 large international cities, Miami, Los Angeles, San Francisco and New York were the only U.S. cities on the list. 

Guangzhou, the capital of the southern province of Guangdong in China was at the top of the list, with luxury home prices dramatically increasing by 36.2 percent from March 2016 to March 2017, according to Knight Frank’s first-quarter Prime Global Cities Index.  The city with the second highest luxury real estate price increases was Beijing, where luxury home prices increased by 22.9 percent and Toronto, where luxury home prices increased by 22.2 percent.  The single-digit price increases in the United States are mild by comparison.  

“We’re seeing steady and sustainable luxury price growth in the key U.S. markets,” Says Kate Everett-Allen, head of international residential research at Knight Frank.  Miami, Florida led the list of U.S. cities with the highest luxury home price growth, ranking as number 14 on the overall list. Miami’s super high-end market was propelled by new condos in glass high-rises, which have finally been finished and put on the market.

Miami is not the only United States city bouncing back from the recession in a significant way with regard to the luxury home market.  The April Market Report released by the Naples Area Board of REALTORS® (NABOR®), which reports home listings and sales for all of Collier County (except Marco Island) indicates pending sales for homes in the $2 million and above price range increased by 41 percent.  Both March and April activity have had residential real estate professionals in the Southwest Florida area entering the summer months with a positive outlook.

Overall market statistics by price released by NABOR® indicate a 52 percent increase in pending sales for homes in the $2 million and higher price range, when comparing May 2016 to May 2017 and a 117 percent increase in closed sales for this price range, when comparing May 2016 to May 2017.  Meanwhile, the median closed price for the overall market in this price range for the Naples area decreased by 8 percent from May 2016 to May 2017.  Single family home market statistics by price for the Naples area show an 85 percent increase in pending sales for single family homes priced at the $2 million and over price range from May 2016 to May 2017 and a 78 percent increase in closed sales for this price range when comparing May 2016 to May 2017 closed sales numbers.  The median closed sales price for single family homes in this price range increased by 2 percent from May 2016 to May 2017.

Increasing the Homeownership Rate as a Boost to the Economy

REALTORS® across Southwest Florida and throughout the United States are dedicated to promoting homeownership opportunities and the elimination of hurdles to achieving the American dream of owning a home.

“As REALTORS®, we work every day to help people realize the American Dream of owning their own home,” says 2017 Florida REALTORS® President Maria Wells.  “Opening the door to homeownership helps families find security and stability.  While buying a home is usually the biggest financial investment someone may make in their lifetime, it also offers a sense of place and community.  Our homes hold our hopes, our memories and our dreams for the future.”

Extending a long-standing tradition, President Donald Trump has declared June as National Homeownership Month and has announced his support to the goal of increasing the U.S. homeownership rate.  According to the declaration:  “For generations of Americans, owning a home has been an essential element in achieving the American Dream.  Homeownership is often the foundation of security and prosperity for families and communities and an enduring symbol of American freedom.  This month, we recommit to ensuring that hard-working Americans enjoy a fair chance at becoming homeowners.”

The continued recognition of June as National Homeownership Month inspires everyone within the real estate and housing industries to continue to promote homeownership as an important contributor to economic strength and to increase the number of homeowners, especially amongst minority groups.  According to the most recent United States Census data reported, the homeownership rate in the state of Florida for the first quarter of 2017 was 64.6 percent, while the homeownership rate for the entire nation was 63.6 percent for the same period of time. 

Wells impressed the fact that homeownership serves as a foundation for communities, instilling pride and a sense of belonging among individuals within the communities.  Research indicates that homeownership provides both tangible and intangible benefits to the economy, community and the individual homeowners. 

Recognition of homeownership first began as a week-long celebration in 1995, and was later extended to the entire month of June by President George W. Bush in 2002. 

Enabling Entry to Housing Market Through Downpayment Assistance and Tips

Out of the 902 closed sales for homes in the Naples area during April 2017, 65.3 percent were cash sales and 34.7 percent were conventional mortgage sales, according to the latest report released by the Naples Area Board of REALTORS® (NABOR®).  The March Market Report pointed out the history of cash sales in the area has dropped over the last several years and more buyers are using conventional mortgages for the purchase of their homes: 73 percent cash sales in March 2015, 67 percent for March 2016, and 64 percent for March 2015.  With a growing number of homebuyers turning to financing in order to purchase a home and a recent survey by real estate data provider Zillow reporting that more than two-thirds of renters consider setting aside money for a downpayment as the number one obstacle to entering the housing market, it is important for potential buyers to be aware of the options available to assist them in getting over the downpayment hurdle.

Here are some tips for potential homebuyers to consider in overcoming the downpayment hurdle include:

·      Consider beginning to save early on.

·      Carefully weigh loan options.

·      Look into lenders offering loans through government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac, which only require a 3 percent downpayment or loans offered through the Federal Housing Administration (FHA), which require a 3.5 percent downpayment.

·      Buyers who are U.S. Military Veterans, service members or residents of specific rural areas may not have a downpayment requirement at all, as the Department of Veterans Affairs and the U.S. Department of Agriculture have zero-downpayment loan programs available for qualified borrowers. 

·      Consider using gift money from relative or friends toward the downpayment amounts or retirement savings. 

·      A large number of downpayment assistance programs exist across the nation as well, for borrowers with low to moderate income, teachers, firefighters, and other public service positions.

With industry leaders indicating a vast and growing number of potential homebuyers are currently interested in entering the housing market, as well as a decreasing number of cash sales in the Naples area, an increasing number of buyers looking to finance the purchase of a home, and clearly expressed concerns about challenges in saving enough money for a downpayment, a clear analysis of all of the options available to potential homebuyers is timely and essential.   As the summer residential real estate season begins, potential homebuyers are encouraged to explore the many options available and carefully consider those options as far as requirements for qualification and what will best fit the individual current and future needs of each homebuyer.

Sellers Adjusting Pricing to Market Value in Southwest Florida Real Estate Market

The single-family housing market in Southwest Florida has continued to see sellers modifying their pricing to match current market value. These modifications to pricing to current market value have resulted in a decrease of the average median home prices in Southwest Florida and have helped to increase pending sales activity. This practice amongst home sellers in Southwest Florida is projected to continue and is expected to continue to boost sales activity in the area as we move forward through the remainder of 2017.

In contrast, the condominium market in Southwest Florida is still showing many units priced high and in need of price adjustments. This has had an impact on the average days on the market for condominium homes. As summer approaches and seasonal buyers are expected to return to the area for the summer selling season, condominium homeowners are anticipated to make the price adjustments necessary to attract buyers who are looking for properties listed at fair market value versus overpriced units.

Housing market reports indicate the number of overall closed sales in the Bonita Springs-Estero area within Southwest Florida, including single-family homes and condos, increased to 2,989 units for the 12-month period ending in April 2017. This is compared to 2,965 units for the 12-month period ending in April 2016. Pending sales for April 2017 were at a 7 percent increase with 3,098 units when compared to 2,902 units in April 2016. Activity narrowed slightly for the Naples area, when compared to the strong end to the first quarter of 2017, as pending sales for the 12-months ending in April 2017 showed a 3 percent decrease. Closed sales showed a 4 percent decrease and inventory, in contrast, showed an 8 percent increase. Again, continued price adjustments and the beginning of the summer selling season are expected to boost the housing market in Southwest Florida in the coming months, offering a positive outlook for the area’s residential real estate market.

Home Sales Forecasted to Top Last Year’s Totals

Lawrence Yun, Chief Economist of the National Association of REALTORS® (NAR) provided his 2017 midyear forecast and was joined by Jonathan Spader, Senior Research Associate at the Joint Center for Housing Studies at Harvard University, and Mark Calabria, Chief Economist and Assistant to Vice President Mike Pence, in presenting at the 2017 REALTORS® Legislative Meetings & Trade Expo. Discussions included the ongoing strength of the United States job market combined with an upward trend in consumer confidence, and how these factors are expected to contribute to a forecasted 3.5% increase in existing home sales for 2017. 

Yun discussed the challenges presented by low inventory and high prices in some metro areas, while Spader discussed the homeownership rate and Calabria discussed the importance of productivity and the labor force participation rate in encouraging the growth of the economy.

The first quarter of this year represents the best quarterly existing sales pace in ten years with 5.62 million sales.  Yun states that he expects activity to remain on this path and finish the year at approximately 5.64 million.  Yun’s projected 5.64 million in sales would represent the best since 2006 (6.47 million) and 3.5 percent above the total number of existing sales for 2016.  “The housing market has exceeded expectations ever since the election, despite depressed inventory and higher mortgage rates,” says Yun.  “The combination of the stock market being at record highs, 16 million new jobs created since 2010, pent-up household formation and rising consumer confidence are giving more households the assurance and ability to purchase a home,” adds Yun.

Despite the fact that the number of home sales for the U.S. is at a decade high, Yun expresses his belief that the strong labor market should be encouraging an even higher number of sales.  Yun says, “There’s little doubt first-time buyer participation would improve and the homeownership rate would rise if there was simply more inventory.” 

Yun foresees new housing construction to increase by 8.4 percent to 1.27 million for this year, but this is still not quite sufficient to make up for the low number of new homes build in the last few years.  New single-family home sales are estimated to total approximately 620,000 for 2017, an increase of 8.4 percent from 2016. 

“There was a lot of uncertainty at the start of the year, but a very strong first quarter sets the stage for a modest sales increase compared to last year,” said Yun. 

Buyers of Second Homes Focus on Investment

 

Investment home sales conquered the second home market in 2016, with a total of 1.14 million units sold for 2016, according to the recently released Investment and Home Buyers Survey results, compiled by the National Association of REALTORS^® (NAR).  However, the number of purchases of vacations homes decreased dramatically by 21.6 percent with a total 721,000 units for 2016.

NAR Chief Economist Lawrence Yun says, “In several markets in the South and West – the two most popular destinations for vacation home buyers – home prices have soared in recent years because substantial buyer demand from strong job growth continues to outstrip the supply of homes for sale.”  “With fewer bargain-priced properties to choose from and a growing number of traditional buyers, finding a home for vacation purposes became more difficult and less affordable last year,” Yun adds.

According to Yun, vacation home sales are now 36 percent below their 2014 peak.  The median price for vacation homes was $200,000, representing a 4.2 increase from 2015.  The portion of all-cash purchases in this sector dropped from 38 percent in 2015 to 28 percent. 

The median price for investment homes was $155,000 for 2016, representing an 8 percent increase from 2015.  The portion of all-cash purchases in this sector remained the same, at 19 percent, from 2015 to 2016.

“Sales to individual investors reached their highest level since 2012 (1.20 million) as investors took advantage of record low mortgage rates and recognized the sizeable demand for renting in their market as renters struggle to become homeowners,” says Yun.  “The ability to generate rental income or remodel a home to put back on a market with tight inventory is giving investors increased confidence in their ability to see strong returns in their home purchase.”

According to the survey, 42 percent of investors purchased a property with the goal of generating rental income, while 16 percent of investors purchased a home to hold onto for potential price increases.  Forty-two percent of those who purchased vacation homes did so in order to use the home for a “family retreat” or vacation property, while 18 percent of those who purchased a vacation home did so for retirement.  A large number of both investment home and vacation home purchasers said they rented the property short-term (less than 30 days).

Grants and Programs Available to Assist First-Time Homebuyers

The tasks involved in purchasing a home can be very overwhelming, particularly for first time homebuyers. In addition to all of the forms and disclusures involved, all of the expenses involved can add up quickly and become daunting.  On the plus side, there are many grants and programs available to assist first-time homebuyers with this process. 

Some of the options available nationwide include FHA loans available through the Federal Housing Administration (FHA), an agency that operates within the U.S. Department of Housing and Urban Development (HUD), which insures the mortgage and lenders receive a layer of protection that will protect them from experiencing a loss if the borrower ends up defaulting on the mortgage.  FHA loans typically offer competitive interest rates, a reduced down payment, and lower closing costs. Borrowers with a credit score of 580 or higher could be eligible for a mortgage with a down payment as low as 3.5 percent.

Also, USDA loans provide a homebuyer assistance program of the U.S. Department of Agriculture focuses on residences in certain rural areas. Through this program, the borrower does not need to purchase or run a farm to be eligible, the USDA guarantees the loan, there may be no down payment required, and the loan payments are fixed. USDA loan program applicants with a credit score of 620 or higher typically receive streamlined processing.

Other programs available include:

·      VA loans through the U.S. Department of Veterans Affairs and this program assists service members, veterans and surviving spouses in the process of purchasing a home.

·      Good Neighbor Next Door, which is sponsored by HUD and focuses on providing housing aid for law enforcement officers, firefighters, emergency medical technicians and teachers.

·      Fannie Mae or Freddie Mac have a program through which they work with local lenders to offer mortgage options that benefit low- and moderate-income families.

·      Energy Efficient Mortgage is a program that allows one to add improvements to their home that will make it more environmentally friendly. The federal government supports Energy Efficient Mortgage loans by insuring them through FHA or VA programs.

Conversations Regarding Sustainable Homes Increasingly Significant

 

Sustainable features in homes are becoming a more important topic of conversation among real estate professionals, builders, homebuyers and sellers. The National Association of REALTORS^® (NAR) recent REALTORS^® and Sustainability report reveals over fifty percent of REALTORS^® affirm that real estate buyers and sellers are interested in home sustainability issues and practices.

"As consumers' interest in sustainability grows, Realtors understand the necessity of promoting sustainability in their real estate practice, such as marketing energy efficiency in property listings to homebuyers," says NAR President William E. Brown. "The goal of the NAR Sustainability Program is to provide leadership and strategies on topics of sustainability to benefit members, consumers and communities."

To accommodate the increasing consumer interest, more Multiple Listing Services (MLSs) are including data entry fields to identify a property's green features; 43 percent of respondents report their MLS has green data fields, and only 19 percent do not. Real estate professionals see great value in promoting energy efficiency features within listings, with seven out of 10 stating that they feel strongly about the benefits in promoting those features to potential homebuyers.

The sustainability survey asked participants about renewable energy and how they view the impact of renewable energy on the real estate market. 80 percent of real estate agents and brokers said that solar panels are currently available in their market; forty-two percent said solar panels increased the property value.

The home features that survey respondents said clients consider as very or somewhat important include a home's efficient use of lighting (50 percent), a smart/connected home (40 percent), green community features such as bike lanes and green spaces (37 percent), landscaping for water conservation (32 percent), and renewable energy systems such as solar and geothermal (23 percent).

When it comes to the sustainable neighborhood features that clients favor, 60 percent of survey respondents listed parks and outdoor recreation, 37 percent listed access to local food and nine percent listed recycling.

As conversations regarding sustainability issues and practices become more and more common and features for homes further advance technologically and with regard to accessibility, it will be fascinating to see how this dialogue progresses between real estate professionals, homebuilders, homebuyers, and sellers in the future.

Heather Wightman Named a Southwest Florida Five Star Real Estate Agent

 

Five Star Professional partnered with Gulfshore Life magazine to identify real estate, mortgage and insurance professionals in the Southwest Florida area who deliver outstanding service and client satisfaction.  

Now entering its 15th year, Five Star Professional conducts in-depth, market-specific research in more than 45 markets across the United States and Canada to identify premium service professionals. 

Five Star Professional contacts thousands of recent homebuyers, along with real estate agents, to identify award candidates (nominees) and measure their client satisfaction levels based on the services they have provided. Phone, mail and online respondents rate their mortgage professional on criteria such as overall satisfaction and referability. Qualifying candidates are then evaluated on objective criteria such as experience, production levels and disciplinary and complaint history.  Professionals do not pay a fee to be considered or awarded.

The Five Star award is presented to local professionals who demonstrate outstanding service to their clients and only a small percentage of real estate professionals in the Southwest Florida area can be selected to receive the award.

This year’s Southwest Florida Five Star Real Estate Agent award winners have been announced in this month’s issue of Gulfshore Life, and Heather Wightman is among the winners!

Heather provides world-class service, which is clear through her clients’ loyalty.  With a solid foundation of knowledge and experience, Heather works to understand her clients’ needs and provides her assistance in helping each of her clients to reach their individual real estate goals.

Hispanic Homeownership Influence Exceeds National Statistics

Hispanics have a strong influence in homeownership, exceeding national statistics as they purchase homes at an increased rate for the second consecutive year. 

According to the National Association of Hispanic Real Estate Professionals’ (NAHREP) recently released 2016 State of Hispanic Homeownership Report, the Hispanic homeownership rate increased to 46 percent last year, in spite of a decreasing overall rate of homeownership across the nation.  The Hispanic homeownership rate was 45.6 percent for 2015 and 45.4 percent in 2014.  Over 7.3 million Hispanic households owned their homes in 2016, with 330,000 new households added – 38 percent of all households formed.

The drivers that are compelling Hispanics to purchase a home are the pursuit of the American Dream and the fact that the majority of Hispanics view homeownership as a viable investment vehicle for building wealth, as well as the ideal for raising children. “The significance of a strong desire for homeownership cannot be overstated,” the report states.  “Where there is a will, there is generally a way.” 

More members of the real estate industry are also working to meet the unique needs of Hispanic homebuyers, particularly in terms of obtaining financing.  “While the Hispanic market has outgrown the ‘niche’ segment designation, the housing industry is just beginning to fully recognize its significance to the vitality of the overall market and is responding with products and services that are more relevant to the needs of Hispanic consumers,” states the report, citing recent initiatives spear-headed by Bank of America, Fannie Mae and Freddie Mac, and Wells Fargo. 

Some hurdles to Hispanic homeownership, such as financing and a lack of knowledge regarding Hispanic cultural norms amongst members of the housing industry, still exist.  “Hispanics tend to reside in a multigenerational household of a typical nuclear family and include additional family members like grandparents or other adult relatives, all of whom contribute to household expenses,” the report states.  “These influencing factors are interconnected with their culture and affect how they bank…Access to culturally competent real estate and mortgage professionals who speak Spanish and can recommend appropriate solutions to meet their needs creates a level playing field.”

For real estate professionals, Hispanics signify a sustainable and massive opportunity.  Ninety percent of Hispanics favor owning a home over renting one in the future, and 62 percent are more likely to purchase a home than rent one upon their next move.  In 2016, Hispanics had a purchasing power of $1.4 trillion – a number that will continue to grow as incomes and Hispanic-owned businesses increase and expand.

UF Survey Results Show Sharp Increase in Florida Consumer Sentiment

 

Consumer sentiment among Florida residents increased in March to the highest level in 15 years, according to the most recent University of Florida (UF) consumer survey. 

University of Florida’s most recent consumer survey results indicate a consumer sentiment reading of 99, the highest rate since March 2002 and the second-highest rate since November 2000.  The lowest index possible is a 2, while the highest possible is 150.  All components that the index is based on showed an increase.

The current outlook that Floridians have regarding their financial situation increased from 88.1 to 88.5.  The perception of Floridians regarding whether it is a good time to buy a major household item such as an appliance increased from 99.7 to 103.5.  Hector H. Sandoval, Director of the Economic Analysis Program at University of Florida’s Bureau of Economic and Business Research says, “The increase in these two components shows that current economic conditions improved among Floridians in March.”  “In particular, women and those under age 60 displayed more optimistic perceptions.” 

The rating measuring what Floridians expect regarding the standing of their personal finances a year from now increased from 99.5 to 107.3 and participants’ viewpoints regarding the economic conditions of the United States over the next year increased from 92.0 to 99.2.  Participant viewpoints of the United States economic conditions over the next five years also increased from 89.5 to 96.7.

“Overall, Floridians are far more optimistic in March than the previous month.  The gain in March’s index came mainly from consumers’ future expectations about the economy.  Importantly, these views are shared by all Floridians, independent of their demographic characteristics and socioeconomic status,” says Sandoval.  “These expectations are particularly strong among women and those with an income under $50,000.”

Encouraging economic news has likely boosted consumer sentiment in Florida.  The labor market statewide continues to expand, with more jobs added on a monthly basis for over six years.  The unemployment rate in Florida remained at five percent in February.  According to the U.S. Bureau of Economic Analysis, Florida ranked third out of all states in the nation as far as personal income growth, with a rate of growth of 4.9 percent in personal income from 2015 to 2016. 

The Home Hopper Shopper Tour

Welcome to the Treasure My Home, Hudson Warren Team, and Michael Jackson Team Home Hopper Shopper Tour.  Visiting our Open Houses this Sunday can give you a chance to win a $50, a $100, or a $500 Gift Card!

Rule 1 – Simply visit any of the Open Houses that are listed on our list below on Sunday, April 23 from 1pm – 4pm EST and receive an Open House Registration Form.

Rule 2 – At each Open House you visit, from the addresses listed, have the Realtor/Host on duty stamp your Registration Form.  You will automatically receive a stamp at the first home you visit, when you receive the form.  One stamp per person, per form, per Open House visited.

Rule 3 – Simply submit your stamped form, with completed contact information, to any of the agents at the participating Open Houses prior to 4pm EST.  If you cannot submit your form to a participating Open House agent by 4pm EST, then snap a photo of your form with your camera phone, and text it to 954-464-9998 NO LATER THAN 5pm EST.  In order to successfully submit, all entries, including photos must include your completed form, with correct contact information, and the stamps received.

** No Purchase Necessary and Must Be 21 or Older to Participate **

All entries will be categorized and submitted for a random drawing to win 1 of 3 Gift Cards.

A completed registration form with 1 (one) stamp will be included in a random drawing to win a $50 Gift Card.

A completed registration form with 2 (two) to 4 (four) stamps will be included in a random drawing to win a $100 Gift Card.

A completed registration form with 5 (five) or more stamps will be included in a random drawing to win a $500 Gift Card.

All random drawings will take place on Monday, April 24, 2017.  Winners will be contacted by phone and email, and instructed on where to claim their prize.  Must present a valid photo ID if you are selected as the winner.

The Home Hopper Shopper Tour

The following addresses will be holding Open House Events, for Sunday, April 23 from 1pm to 4pm, and are participating in the “Home Hopper Shopper Tour”.  Be sure to have your Registration Form stamped by the REALTOR/Host on duty.  Also, be sure to leave you registration at the final home on your stop by 4pm EST.  All registration forms must be complete to qualify for entry.

Fort Myers

15192 Riverbend Blvd.

North Ft. Myers, FL  33917

8849 Paseo De Valencia St.

Ft. Myers FL  33908

12945 Kingsmill Way

Ft. Myers, FL  33913

10930 Stonington Ave.

Ft. Myers, FL  33913

Cape Coral

612 SW 21^st Lane

Cape Coral, FL  33991

Naples

321 Steerforth Ct.

Naples, FL  34110

213 Charleston Ct.

Naples, FL  34110

15480 Cortona Way

Naples, FL  34120

130 29^th St NW

Naples, FL  34120

Estero

21163 Bella Terra Blvd

Estero, FL  33928

21874 Bella Terra Blvd

Estero, FL  33928

21592 Belvedere Lane

Estero, FL  33928

21591 Belvedere Lane

Estero, FL  33928

21043 Butchers Holler

Estero, FL  33928

20091 Markward Crossing

Estero, FL  33928

Bonita Springs

3581 Lakemont Dr.

Bonita Springs, FL  34134

10155 Avonleigh Dr.

Bonita Springs, FL  34135

23184 Sanabria Loop

Bonita Springs, FL  34135

27079 Matheson Ave #107

Bonita Springs, FL  34135