To be brief, I have mentioned in previous posts thatÂ oftenÂ the first 10 or 15 minutes I spend with any buyer or seller is oftenÂ spent riding them on the tram from Disneyland
back to R-E-A-L-I-T-Y
.Â Much of this I blame on the misinformation they get from the media.
Imagine a weatherman that told you the forecast for the entire U.S. is 78 and sunny.Â You would think the weatherman was smoking crack.Â Unfortunately, that is the most common way real estate is reported in the media.Â One big national average that has absolutely NOTHING to do with your local market.Â Real estate is NOT just as local as the weather report.
Â It is much MORE localized than even the local weather report, especially in today's market!
NORTHEAST and SOUTHEASTÂ FORT LAUDERDALE
When the media does report on a particular area, like southeast Florida or maybe even Fort Lauderdale, they STILL report the AVERAGE of what is happening, NOT the particular sub-market that you might be interested in.
At this point, many buyers and sellers understand the basics of what makes up a Buyers Market
(more than 10 months worth of inventory for sale), a Sellers Market
(less than six months of inventory), and a Balanced Market
(six to 10 months of inventory).Â What many people do not realize, is that ALL of these markets can happen in the same city, at the same time, in different price ranges.Â Below is a chart of the available inventory of singe family homes on the eastern half of Fort Lauderdale at the end of the 4th quarter of 2009.
Did you notice that there are THREE DIFFERENT MARKETS
in "Today's" real estate market?Â Looking for a single family home on the eastern half of Fort Lauderdale/Wilton Manors/Oakland Park?Â If your price range is less than $200,000 then you will find yourself in an EXTREME SELLER'S MARKET
.Â First-time homebuyers are literally waiting in line
for a single family home that is priced correctly in good condition.Â What is left in that price range at the moment is largely nothing but overpriced leftovers and even counting those the supply = only 3.9 months.Â
This is a DIFFERENT WORLD from the 10+ months of inventory currently being reported by the media.
Â That is because the media is only concerned with the overall average, NOT with what is going on in your particular sub-market.
Looking for a single family over a million?Â The market is the EXACT OPPOSITE
months of inventory out there!Â Yes,Â probably half of those sellers are still hopelessly overpriced, but still, a complete 180 departure from the market that first time homebuyers are experiencing.Â So how does this "average-based" misinformation in the media affect buyers and sellers?
Â Buyers in the ranges that are currently "Sellers markets" will probably be disappointed with what they find when they start looking at properties.Â To make matters worse, when they finally locate a good property, they will probably make an offer that is too low.Â The result?Â They lose the property to a more educated buyer who will be makingÂ an offer in line with what the property is worth, instead of trying to lowball the bank or the seller.Â
On the other side of the coin, a seller in the luxury market -still an extreme buyers market- might read or hear that sales are up, dig in their heels at a price that is too high, and then turn down a reasonable offer. As a result they will end up chasing the market down further and lose equity they could have cashed out on.
Just becauseÂ supply and demand for lower priced single family homes has changed doesn't mean thatÂ the lopsided supply and demand ratios in the upper price ranges won't continue to push thoseÂ values downward.Â After all, in today's market,Â conditions and expectations for buying, selling, or negotiating on aÂ $200,000 house have absolutelyÂ nothing to do with
the market conditions forÂ aÂ higher priced property, say $750,000 and up.
Advice from well-meaning friends and family members often reinforce the misconceptions buyers and sellers have regarding theÂ current real estate market.Â This all too common scenario has become a daily occurence, and often results in buyers and sellers making SERIOUS mistakes as a result.Â
For those of you looking at condos, here's the breakout on the condo market, east Fort Lauderdale, end of 4th quarter of 2009.
Now more than ever, it's EASY to tell the difference between a full-time serious professional agent, and those that just sell real estate as a hobby, with no REAL VALUE ADDED from their services. If you are buying or selling in today's market, finding a serious agent that knows the in's and out's of today's market is an essential first step in making your best, most educated real estate decision.
Feel free to contact me in regards to YOUR particular real estate situation.Â HAVE A GREAT DAY!
Keller Williams Realty Professionals
3696 N Federal Hwy STE 101
Fort Lauderdale, FL 33308