My New Blog

We have all heard about the awesome deal someone got in a real estate purchase. Stories are endless of people that got the deal of the century.  Phrases like "we got the seller to go down $50,000 on their price" or perhaps this one: "We'll really make a killing when we sell in a year from now!"  The truth is that many buyers lost out on their dream home because it was more important to get "the deal" then it was to own your dream home.

Getting a great deal on a real estate purchase rarely has anything to do with the amount of discount one gets off an asking price. Buying real estate is not like buying a car or a bucket of golf balls at a flea market. Factors such as "where will my kids go to school" and "how long will it take me to get to work from here" will ultimately be more important than negotiating a deal only to loose out because the seller wouldn't cooperate or worse, another buyer bought it out from under you.

So what's the answer? Well, there is no one answer. In my 18+ years in the Tampa bay real estate market I have tried to follow some basic rules. If a home is in a development as many are, I usually avoid  suggesting the biggest or the most expensive home in a community. A home that is smaller to middle sized compared to others is often a safer choice in most neighborhoods.  I also tend to recommend properties in areas where there are villages of various sized and priced homes.  The mindset for this is twofold. The individual neighborhoods tend to be smaller and often better kept and when it comes to selling, you'll usually have less competition.  I also will ask my buyers to consider their day to day needs. Where are the grocery stores? How about the Pharmacy? Schools? Churches? Playgrounds? Ball fields? These are important considerations.

What about CDD fees and home owners associations? Communities that charge these fees usually include a club house, community pools, playgrounds, utility discounts and structured activities. If you have children, it may the cheapest babysitter you ever had. If you don't take advantage of the facilities it may just prove to be expensive. 

Then there's the property condition. Normally a distressed home will cost less than a pristine property. However, it's rarely a good idea for a buyer who doesn't know a screwdriver from a socket wrench to buy a fixer upper.  On the other hand, a buyer who's favorite tv program is "fix this house" or loves the idea of remodeling a bathroom may be able to build equity through some old fashion sweat. Just remember you want to love your house, not hate it.

The best thing you can do for yourself is to find an experienced real estate professional who is truly focused on your needs, not thiers. A genuine professional can assist you in sorting out the real values....your values. Be it location, amenities, size AND price!  Ask your friends, family or co-workers if they worked with a real estate professional they loved! If that doesn't work, take a look at all those initials below their names on their business cards. I proudly display the GRI, Graduate of the Real estate Institute and the Certified Residential Specialist (CRS) is the highest Designation awarded to sales associates in the residential sales field. The CRS Designation recognizes professional accomplishments in both experience and education. Less than 4 percent of all licensed Realtors® are Certified Residential Specialists.  However you decide to buy a home, try to remember this is one of the largest investments you will ever make.....Make sure it's a good one.  

With the current housing slump, property owners are seeing their once pot of gold slipping away. Nationally and in the Tampa Real Estate market, Housing inventories are way up, prices are down and foreclosures are increasing. Then there’s Wall Street where any stocks associated with housing are sliding and the media is screaming that the world as we know it is coming to an end.

Tampa home ownership traditionally has been one of the most stable investments an American could own…until recently. So just who is really to blame for America’s housing debacle? Well I feel that there is plenty of blame to go around but you maybe surprised who is the biggest villain.

Let’s begin with all the Tampa Buyers, the very people who purchased homes in the past three years. I often hear older folks say how difficult and expensive things are for the young people. It’s true that competition is increasing for some things but we have to consider the realities. When I was growing up most families had both a dad and mom, three to four kids, a mutt dog and maybe a couple of gold fish all living in a three bedroom one bath house often no bigger than 1500sf with one car in the one bay garage. Today’s family consists of one or two children, a pure bred cat and dog and often just one parent. The average new home is 2000sf or more loaded with all the newest appliances, toys and other “got to haves”. The two to three car garages are often piled up with so much stuff they can’t even close the doors while two leased cars park in the driveway.

As the media spread word of the surging housing market, especially in communities like Tampa, Brandon, Riverview, Wesley Chapel and Apollo Beach, people of every shape color and creed got their Real Estate Licenses and instantly became real estate experts. The most innovative salespeople held seminars touting the latest and greatest “investment opportunities” and people ran to various new home communities buying homes they could never afford. Other real estate agents were more than happy assist families in fear of not having their dream home. Tampa Buyers scrambled to buy homes before they were priced beyond their reach. Local real estate organizations doubled, tripled, and even quadrupled overnight. Many of the newfound experts made loads of money being little more than order takers. Standards, ethics and sales commissions dropped with the increased competition from newbie’s who nothing about the commitment, time or expenses involved in real estate sales.

The Mortgage Industry grew as well during the big boon. The vague laws in many states, allowed someone to become a loan originator with little more than weekend class and a computer. Banks all over the country saw the opportunity to make money and convinced the regulators to back away from established guidelines. Times were good and almost anyone who could breathe was able to obtain a mortgage loan for nearly any amount. All you had to do was say that they made so much money and fog a mirror. Among the most popular loans was the “liar loan” aptly named the “stated income” loan and then there was the popular “interest only” loan. Naive buyers everywhere chose these loans because they were told of how much equity they would gain without putting a dime of their own money into the purchase.

Wall Street saw the writing on the wall and the possibility of having all their minions pull ‘their” money from their stock market. Stock funds were created using the mortgage companies as players and pawns. Anyone not stupid enough to invest into a long range investment for the short term, sank hard earned money into housing industry stocks while the smartest Wall Street players gambled on hedge funds just waiting for the collapse of the market. If you think about it, doesn’t it sound exactly like the dot-com boom and bust? Hmm. Today, as the rest of America wrestles with how to fix this mess hedge fund players like Steven Cohen and George Soros are worth billions at the expense of stupid Americans (his words not mine).

The glue that binds this entire mess is none other than the all powerful American media. Under the safe and secure First Amendment they were always on the ready to assist anyone with enough money control the hearts and minds of the American public. During the rise of the marketplace they were relentless in feeding the frenzy. Experts popped up everywhere telling everyone the errors of their ways in holding all their new found equity away from their hands. “Refinance” or “lines of equity” were latest buzzwords among “smart investors.” Nearly everyday, articles were found in the wall street journal or New York Times totting the need to invest before it’s too late! Now that the collapse has occurred the media is working to again exploit all the once smart investors turned losers. I think ole algore is on to something with the carbon credits and blaming America for the entire world’s pollution. Can you say global warming?

As the dust settles in the collapsed housing market, Wall Street will begin their next method of making money from the greedy little wannabes. Today the media is placing all the blame on the politicians while the real criminals walk away free of any responsibility or blame. New York and Hollywood will continue advertising the latest and greatest wrapped up in “news” articles and documentaries and the majority of America will go on with their lives not having learned a thing. Who are the biggest criminals? Is it the buyers? the real estate agents?, perhaps the mortgage industry? Don't forget Wall Street and the American media? Who do YOU think is really responsible for the greatest loss of American assets in history? Perhaps a more important question should be; Are you sick of being played enough to want to do something about it?

Throughout history real estate investment has always been safe. A home meant safety for your family and a place to entertain your friends. Real estate has always assured a positive return on investment.

In the late 1990’s Wall Street went from being a place where business suits were the symbol of the conservative nature of investing in companies futures to being better known for massive stock value swings where anyone with a laptop and an Internet connection became an investor. Hedge funds became the game of choice of those who had enough money to affect the outcome of the various investment schemes. The big dollar gamblers grew richer while millions of little people lost their retirement futures and companies folded. A quick review of the Dot-Com boom and subsequent crash as well as the latest housing fiasco are proof of gambling nature of Wall Street. In both situations, inexperienced “investors” drew money out of their CD’s, Blue Chip stocks and their home’s equity hoping to get rich quick. The Dot-Com stocks mostly turned out to be worth no more than the paper they were written on….yet no one went to jail.

Recently, “real estate investor” wannabes repeated their tactics and ran to buy everything in sight. Home sellers enjoyed wonderful appreciation gains and prices climbed through the roof! Panicked families in fear of loosing their opportunity to enjoy the American dream of owning a home battled with these investors to buy, furthering the frenzy. When the hedge fund managers signaled, the always willing media brought out stories of woe until the little people looked up and discovered that they were in the process of loosing their homes, cars, furniture, and savings. From Seattle Washington to Tampa Florida, homes are becoming foreclosures and short sales are on the increase with homeowners, banks and investors loosing money at a pace never seen before. All the while hedge fund managers become richer…. and yet no one goes to jail. A current list of the top 50 richest Americans reveals that hedge fund managers dominate the list and they are all worth BILLIONS!

If recent history is any indicator of our future, taking real estate advice from Wall Street will be worth the same as the dot-com stocks they sold you not so long ago. The sooner they get out of the real estate business the better. Always remember, a homes value often can’t be determined in dollars and cents when measured against its effect on your family’s quality of life.