Rent vs. buy

Rent vs. buy: Decision comes down to job, finances



South Florida renters constantly hear jeers that they're paying somebody else's mortgage.

They feel pressure to escape rent increases and take advantage of low home prices last seen a decade ago.

But a home still may be a stretch financially. And prices may decline further, embittering new owners who see their prized asset lose value.

For most, the decision boils down to whether their jobs are stable, how much savings they'd have after buying and how long they intend to stay in the area.

"No one thinks of housing as a risk-free investment anymore," said Jed Kalko, chief economist for real estate website Trulia.com. "If you're going to buy, you need to be in a financial position where you're able to deal with the risks of prices going down."

Housing industry experts weigh in on the rent vs. buy debate in three hypothetical South Florida case studies.

Scenario One: A police officer making $60,000 a year, newly married, currently renting a two-bedroom apartment for $1,500, never owned a home before.

Jim Flood, regional manager for Supreme Lending in Boca Raton, said he'd work with the officer to determine his cash position.

A new homeowner still should have at least two to four months' of cash in savings after buying, Flood said. Assuming he has the appropriate savings and his job is safe, the officer is a good candidate to own, Flood said.

If he put down 3.5 percent on a $150,000 home and had an interest rate of about 4 percent, his total monthly payment (principal, interest, taxes and insurance) would be roughly $1,100 — a savings of $400 from what he pays in rent.

Bottom line: Easy call. Buy.

Scenario Two: Recent college graduate, living with her parents, monthly payments of $300 for a car and $400 for student loans, has minimal savings and a $40,000-a-year job, but is willing to relocate for another.

The car and student loan debts are the biggest obstacles to buying, Flood said. She'd have to buy a small home or condominium, but she's likely better off staying a renter.

"If it was my daughter, I'd tell her to pay off the car or student loans and save more money for a rainy day," Flood said.

Randy Bianchi, co-owner of Paradise Properties of Florida in West Palm Beach, agrees, adding that the uncertainty over how long she'll be in the area is another concern. Plan to live in a home you buy for at least five years, experts say.

"Homes are cheap right now, but owning will tie you down," Bianchi said.

Kalko offers another consideration: If she's still living with her parents, she'd be a first-time homeowner with little or no experience in maintaining a house by herself. She'd have to cut the grass and deal with the occasional broken dishwasher. "That's a lot of firsts all at once," Kalko said.

Bottom line: Stay with parents or rent cheaply

Scenario Three: Retired couple in their mid-60s, small pension, just sold their house for a $15,000 profit, looking to stay in the area and downsize.

The major factor here is the modest profit on the home sale. It's not enough to buy another home or condo outright or to significantly pay down a mortgage on a new place, said Michael Citron, a real estate agent in Broward County.

The couple likely would spend $1,200 to $1,500 a month on a mortgage and association dues, but probably only about half that amount if they moved into a 55-and-over rental community, Citron said.

"That's much more manageable for them," he said. "The lawn is taken care of and they can call maintenance if anything needs to be fixed. They just don't have enough money to buy a home."

Bottom line: Rent

By Paul Owers, Sun Sentinel


powers@tribune.com, 561-243-6529 or Twitter @paulowers


Copyright © 2012, South Florida Sun-Sentinel

Fort Lauderdale leads South Florida in absorption of new condos

Fort Lauderdale bested downtown Miami and Miami Beach in the rate at which condominiums built during the boom were absorbed, according to a wide-ranging market report released today by development firm the Related Group. Just 142 of the 5,135 new units built between 2005 and 2009 remained as of January, compared to 1,020 of the 10,001 units built during that time in the Miami beaches and 2,497 of the 17,502 units built in downtown Miami and Brickell. Related Group’s report also desmonstrated how much lower condo prices are in Miami compared to Latin America and Canada, whose citizens have been responsible for much of the absorption. The average price per square foot of downtown Miami conodminiums developed in the last five years is just $400. By comparison, prices per square foot in Toronto and Rio De Janeiro average $1,000, and in San Paulo, Bogota and Buenos Aires it is $900, $700 and $550, according to the report.

The stronger condo sales market has also catapulted the area’s rental market in downtown Miami and Brickell. The report said the rental vacancy rate for those new condo units was just 7 percent in 2011, and the average rent increased to $2,347 per month by December 2011, from $1,728 per month two years prior. — Adam Fusfeld

6 marketing secrets to grow your real estate business

Personal connections more powerful than quantity of Facebook friends


What does it take to successfully market your real estate business online? Matthew Shadbolt, director of interactive product and marketing at The Corcoran Group, shared six great tips that have made his company Manhattan's leading real estate agency. These same tips can help your business, too.

1. Share the story, not just the features
Shadbolt, who is also a featured contributor at InmanNext, an agent-focused website, made an astute observation when he said, "Story is the most shareable type of content." Most agents market their listings by listing the features -- i.e., bedroom and bath count, views, décor, and other amenities.

Unfortunately, features don't sell properties: emotions do. An easy way to tap into the buyer's emotions is through storytelling.

To illustrate this point, I saw a video where a man was selling the ranch that had been in his family for more than 100 years. As he described growing up on the ranch, and later, how he raised his family there, a tear came to his eye. This compelling video generated a lot more buyer leads than a laundry list of property features.

2. Tips around town
An important component of Corcoran's success is its "Tips Around Town." This consists of short videos about fun things to do or other interesting facts about specific neighborhoods.

To implement this approach in your business, you could interview the owner of the bakery that is voted the people's choice for the best pizza in town, show some of the unique art at a local street fair, or just about anything else that illustrates what it's like to live in a given neighborhood.

As Shadbolt advised, "You are rewarded for sharing ... It's important to own slices of the online conversations, especially when it comes to any of the neighborhoods where you work."

3. Content lives and breathes on mobile
Almost 50 percent of all real estate searches today occur on mobile devices. Whether it's your website, blog or video, it's important to see how it will appear on mobile devices. Since close to 50 percent of all real estate searches today are conducted on mobile devices, Shadbolt recommends that you design your marketing for mobile first rather than for larger-screen devices.

4. Video married to "life streams"
Video is still in its infancy in terms of Internet marketing, although it has already started to appear in search-engine results. When you conduct a Google search in most areas, the top two or three videos for that search will appear on the first page of the results.

Other important shifts are in the pipeline. YouTube is developing a product to be viewed on your big-screen TV. This will require a huge shift in terms of the quality that will be required to market your listings in this new format.

Even though the latest mobile phones have high-definition cameras, in the very near future you will have to consider exactly how your video will appear on a big-screen television as well as on mobile devices.

In addition to these trends, "social TV" will become much more prevalent. This includes an increasing number of people using online video chat services such as Skype or Google's Hangout feature. Currently, the ISPs (Internet service providers) are scrambling to expand the bandwidth to meet the oncoming onslaught.

5. The analytics of the everyday
Using Pinterest, check-in sites such as Foursquare, and Facebook's new timeline tool allows people to share what Shadbolt calls a "linear searchable presentation of the minutia of life." These applications allow you to create a visually compelling storyline for your life.

6. How to combat digital overload
A major challenge everyone faces today is digital overload. We are constantly bombarded with more information than we can possibly ever process. So how do we sort through it? Shadbolt provided some simple guidelines.

First, keep in mind that "people are greater than platforms." In other words, it's more important to build real connections with people than it is to accumulate hundreds of friends and followers.

Second, identify the people with whom you really enjoy communicating and build relationships with them. Conversations over time create the relationships that turn into leads.

Third, divide your contacts into groups and/or lists depending upon the platform that you are using. Google Plus already has you do this when you add anyone as a friend. The system asks you to drag and drop (or check off on a drop-down menu) the circles where you would like your new friend to belong.

To sum this all up, use video whenever possible to get a serious jump on your competition. What really matters, however, is connection. Build your connections through storytelling, by sharing what is great about the lifestyle where you live, and by connecting with others based upon the mutual interests that you share



Bernice Ross
Inman News®

HELLO Stop blaming 'the other agent'

We owe our colleagues the benefit of the doubt

Teresa Boardman
Inman News®


There are incompetent real estate agents of all stripes and, yes, we need to "raise the bar."

But we also need to stop assuming that other agents are incompetent as soon as there is the slightest problem with a real estate transaction.

We need to stop telling the world that real estate agents are incompetent because we are making it hard for competent agents to do their jobs.

Our clients have no contact with "the other agent." That makes it easy for us to blame "the other agent" if there is a problem -- and I cannot recall ever having a real estate transaction in which there wasn't some problem or unexpected issue.

We don't listen to each other or give each other the benefit of the doubt. We just assume that the other agent is an idiot, or doesn't care, or is inexperienced or incompetent.

"The bar needs to be raised," we say. For some that means additional education and training requirements for new agents. Others would also like to see tougher licensing requirements. We go on and on. Agents spend hours complaining about other agents.

If an agent does not pick up the phone, it isn't because he is at the dentist having a root canal performed. It is because he is lazy and probably out playing golf.

If we get a lowball offer on one of our listings, we may think the other agent is clueless, when the reality is the other agent has a buyer that is clueless and the agent is just doing his job, which is to advise and represent.

I wish I had a nickel for every time another agent has treated me like an incompetent idiot. We are an independent bunch and most of us have strong ideas about how to do our jobs, and we believe that we do our jobs better than any other agent.

For some of us there is a reason why we are self-employed. We are used to taking charge and we want to be in control. We forget that our way isn't always the only way.

When we treat others as though they are incompetent buffoons, they tend to rise to the occasion. When we blame the other agent for any little problem in front of our clients, we create more problems for ourselves and make the relationship between buyers and sellers adversarial.

There are more negative things written about real estate agents than there are positive, but I refuse to believe that most agents are bad or stupid.

Our industry experts tell us that we need to do a better job. They paint a picture of real estate agents being a bunch of technologically impaired unprofessional morons, and we believe it. We continue to see "the other agent" as a person who got to be an agent because of the low bar.

We need to spend more time listening to each other and working together. We need to give other agents the benefit of the doubt by assuming they do things a little differently, instead of assuming that they are incompetent.

We need to occasionally stick up for each other, and we need to recognize and thank the agents that do a really great job even if they are our competitors.

I am proud of what I do and who I am, and I work hard to do the very best that I can, and I am not convinced that I am unusual.

Many of the people who like to tell me how I should do my job could not do my job. I am not technologically backward, and I am not clueless about what consumers want or about how to serve them.

I am not incompetent -- I am highly educated, skilled and experienced, as are many of my peers. As a group we are treated with much less respect than we deserve by the general public and by our own industry.

We can always improve our own performance and that is where we need to stay focused, and we need to stop assuming that our peers are all clueless and incompetent and listen to them and work with them.

Teresa Boardman is a broker in St. Paul, Minn., and founder of the St. Paul Real Estate blog.

http://www.inman.com/buyers-sellers/columnists/teresaboardman/stop-blaming-other-agent



For More Information about Real estate Careers , Changing Real Estate Firms , 100% Commissions, Free Real Estate Leads, Free Training, Monthly Coaching
Call 954-880-2553 or Visit our Website at http://www.realestatecareerinsouthflorida.com/

2011 Sales set record in Miami

Year-end figures show that homes and condos sold at a pace that eclipsed the volume of deals at the height of the boom.
By Ina Paiva Cordle
icordle@MiamiHerald.com
International buyers spurred Miami-area home sales to a new record in 2011, even exceeding sales volume during the height of the real estate boom in 2005, according to figures released Friday.
Broward County results were mixed, although inventory across both counties showed widespread depletions.
A total of 24,929 condominiums and homes were sold in Miami-Dade County, up 46 percent from 2010 and up 4 percent compared to 2005, according to the Miami Association of Realtors and the Southeast Florida Multiple Listing Service. Condominiums sales surged 54 percent, to 15,009 in 2011, and home sales rose 36 percent to 9,920.
“We’re on the verge of a real estate boom,” said Miami Association of Realtors Residential President Patricia Delinois, citing an array of properties from the Design District and Brickell to Miami Beach.
International investors, with wads of cash, are behind the surge.
“Miami is a top market for international buyers,” Delinois said. “We are attracting people from Latin America, South America, Europe, all over the world. What could they not like in Miami?”
In December, sales of existing single-family homes in the Miami area jumped 16 percent, compared to December 2010. Sales of condominiums rose 22 percent. Those percentage increases beat the change in sales statewide, which dropped 2 percent for both condominiums and single-family homes.
Nationally, sales of existing single-family homes, townhomes, condominiums, and co-ops rose 3.6 percent from December 2010, according to the National Association of Realtors.
Overall, the inventory of residential listings in Miami-Dade dropped 39 percent from 24,278 to 14,087 over the last year, and 8 percent from November 2011 alone, figures show.
Bank-owned properties and short sales, comprising “distressed sales,” drove the rapid absorption, Realtors said. In December, 54 percent of all closed residential sales in Miami-Dade were distressed, compared to 59 percent in December 2010. Unlike a year ago, there are now more short sales closing than bank-owned properties, Realtors said.
“There is a waiting list of investors, with dual and triple offers on REO properties,” said Delinois, who is president and CEO of Century 21 Premier Elite Realty. “We have more of a demand for bank-owned properties than we have a supply.”
Cash sales continue to dominate in Miami-Dade, at 63 percent of total closed sales in December. Cash sales accounted for 42 percent of single-family and 77 percent of condominium closings. Nearly 90 percent of international buyers in Florida purchase properties all cash, Realtors said, compared to 29 percent nationally, reflecting the stronger presence of international buyers in the Miami real estate market.
In the Miami area, the median sales price of condominiums in December spiked 31 percent to $129,900 from a year earlier. The median price of single-family homes jumped 16 percent to $182,300. Statewide median prices in December increased 4 percent to $91,900 for condominiums and 1 percent to $134,300 for single-family homes. The national median existing-home price for all housing types was $164,500 in December, a 2.5 percent drop from December 2010.
In Broward, single-family home sales increased 9 percent in December to 1,082, and condominium sales dropped 8 percent, compared to December 2010.
For the year, total single-family home sales in Broward fell 9 percent to 12,817 in 2011. Condominium sales rose 11 percent, to 16,714 in 2011.
Overall inventory in Broward dropped 35 percent for the year, to 12,997, the figures show.
In December, 46 percent of all closed residential sales in Broward were distressed, and there were more short sales than bank-owned properties.
Cash sales accounted for 38 percent of single-family and 81 percent of condominium closings in Broward.
In December, the median price of single-family homes in the Fort Lauderdale area was $189,600, up 7 percent compared to December 2010. The median price for condominiums dropped 3 percent to $78,200.

Read more here: http://www.miamiherald.com/2012/01/20/2599938_greater-miami-housing-sales-set.html#storylink=addthis#storylink=cpy

More Cash Incentives for Short Sales

Banks Offer More Cash Incentives for Short Sales
More banks are offering home owners incentives to sell their houses in a short sale to prevent a costly foreclosure to the bank. In fact, some banks are offering struggling home owners as much as $35,000 to do a short sale, according to an article at CNNMoney.

Many home owners have been surprised at banks’ recent willingness to approve short sales.

"Initially, the home owners are skeptical," says Elizabeth Weintraub, a real estate professional in Sacramento, Calif. "The bank may have already turned down their request for a modification. Then, one day, they call and say, 'Let us give you some cash.'"

For banks, the incentives have proven to be a smarter move than letting a property fall into foreclosure.

"The first choice is a modification, but if that's impossible then a short sale is a faster, more efficient solution," Tom Kelly, a spokesman for Chase Mortgage, said.

With a foreclosure, home owners stop making their mortgage payments and usually property taxes as well. They also often put off maintenance issues, which can cause the home to lose value even more. Foreclosed homes sold, on average, for 22 percent less than homes not in foreclosure in December, according to National Association of REALTORS®’ data. For comparison, discounts for short sales were about 14 percent.

Daily Real Estate News | Monday, February 13, 2012


For any quations regarding this article or
"South Florida foreclosures", "Florida foreclosure list", "Florida housing market values", "Miami Distressed Commercial investments", "South Florida real estate deals", "Miami courthouse auctions", "Miami courthouse foreclosures", "Florida spec homes"
give us a call at 954-880-2553

Investor demand surge sends Brickell condo prices soaring

By Marilyn Bowden
Investor demand is driving up sale prices on Brickell condos.
According to statistics compiled by Esslinger Wooten Maxwell Realtors, or EWM, the average price per square foot in the fourth quarter of 2009 was $245.54. A year later, it hadn't changed much; the average was $245.22. In the fourth quarter of 2011, however, that figure climbed to $285.46.
"What's interesting," said Patrick O'Connell, interim manager of EWM's Mary Brickell Village office, "is that between 2009 and 2010, inventory increased about 25% in the Brickell area, and at the same time the number of sales also increased 25%. So there was an almost perfect level of increase and absorption."
Because the large influx of inventory was balanced by an equivalent increase in demand, he said, the price per square foot remained the same.
But from 2010-'11, "it was a much better picture," Mr. O'Connell said. "Inventory dropped by 40%, sales increased by a little over 8%, and suddenly the price per square foot rose by 16.41%."
In December 2010, said Lisa Thomson, an associate on The Thomson Team at Coldwell Banker, "there were 349 new listings in the market. This past December, there are only 249 — but the number of sales were the same."
As a result, she said, the average asking price, which was $486,000 last year, is now $583,000 — and the average sold price has gone up from $279,000 to $352,000.
Behind much this success, both brokers say, is Brickell's attraction to investors.
"Maybe 70% of the units go to investors," Ms. Thomson says. "They want a place where they can vacation and then sell when prices are better."
"There's tremendous demand from overseas, and a lot are paying cash," Mr. O'Connell said. "Financing is difficult in some of these buildings, but that doesn't affect our ability to sell them to foreign investors who want to rent them out.
"Right now, the rental market continues to improve, and tenants are making offers on rentals sight unseen."
As rents continue to escalate, Ms. Thomson said, some renters are converting to buyers. She said interest is also heating up among other domestic buyers.
"A lot of people are pulling money out of the stock market now and putting it in real estate," Ms. Thomson said. "Attorneys and financial advisors from New York are looking for condos from $200,000-$300,000, but there's not a lot of them. If you want a building with a stable homeowners' association, you've got to go up to around $400,000.
"Hedge funds are also buying units up. You can't beat the return on your money from real estate right now."
The big question remains the number of repossessed bank properties still to be released.
"There are a lot of properties still in short-sale status that have not been released," Ms. Thomson said, "so it's almost a false perception to say the market is going up. I think it will go down again when they come out."
Mr. O'Connell said if these distressed properties continue to come out in dribs and drabs, the market should not be unduly affected.
"Every one gets multiple offers right away — four or five buyers for each one of those REOs coming on the market," he said. "Without a lot of new buildings coming out of the ground, we should continue to see condo prices edge up over the next 12 months. It will not be a significant increase, but the trend will continue."