A Lot Has Changed In A Month
As summer kicks into full effect, these are the times I wish I had purchased a home with a pool. 4th of July came and my family and I improvised with a blowup $40 pool off amazon in our backyard. As my family of 4 huddled into our makeshift tiny pool we took a moment to just be grateful to pause for a moment.
Life has certainly become a lot busier for us and we have entered into a period where everything is speeding up. Shortly after Florida started reopening we began to see a shift in demand. At the beginning of July, the Florida Realtor Organization laid out the hard truth in an article citing that home inventory had dropped substantially.
They reported that inventory for the Tampa-St. Petersburg-Clearwater market was down by 31.4%.
This is pretty significant and buyer demand remains strong. On the ground level we are seeing significantly more competition so in this monthly update I’m going to break down what’s happening, why it’s happening, and how you can prepare yourself as a buyer or seller in this new landscape.
In my real estate career the $200,000 price range for homes has always been competitive in our local market. It seems like over the years the competition has only increased and the price range of homes flying off the market has been ticking up every year.
Currently, homes in the $200,000 – $400,000 price range are the most competitive I’ve ever seen them. It’s so competitive now that it’s not uncommon for homes that are brand new to market to receive multiple offers. I’ve spoken with real estate friends of mine and experienced it myself where it’s not out of the ordinary to get 8-10 offers or more within 24-72 hours of a home going live.
Now that’s not to say homes don’t sit either because they do, but if a property checks a lot of the boxes people are looking for and it’s located in some of our most popular areas like St. Pete – it’s likely going to be a battleground.
Listing agents are looking at things such as price, terms, timeframes, and more as a way to advise their clients on what offers may be the best fit. Cash offers tend to fair better than those with financing conditions because of the lack of contingencies that could hold up or cause a transaction to fall through.
One major advantage I’ve explained to many of my clients is a cash offer is not contingent on an appraisal. This is big in a market where homes are getting bid up and there’s uncertainty on whether an appraiser will find support for the value in their appraisals.
Financed offers typically have appraisal contingencies in place to protect buyers. An appraisal contingency just means that closing on the house is dependent on the appraisal coming back at at least contract price. If you want to put in a more aggressive offer you may have to get a bit creative. One way to do this is to write in the contract your willingness to pay a certain amount above the appraised value in the event of a low appraisal.
Most sellers want to close as quick as possible so you’ll also want to make sure your bank can close in 30 days or less. A higher escrow amount and shorter inspection period are also attractive to sellers in a multi-offer situation. You should also know that there’s something called an escalation clause you can attach to your offer. Let’s say a home was listed at $250,000 and you put in your offer of $250,000 with an escalation clause up to $260,000 in $1000 increments. Another offer comes in and it’s $255,000, your offer would be bumped up to $256,000. This could help however if the listing agent knows it’s on the verge of not appraising, they may even take a lower cash offer because it’s a for sure thing.
Lastly, believe it or not a lot of homeowners want to know that their house is going to go to a good home owner so a personal letter about you and your family can go a long way. There’s a lot of moving parts and every transaction is different so make sure to hire a knowledgeable agent to help navigate these difficult situations.
How To Prepare And What To Expect
The city of St. Pete recently completed the new pier which cost roughly 80 million dollars to build. As downtown St. Pete has grown and become more of a utopia for walkability and activities, we have seen continued demand for being close to the action.
As a seller and a home owner here, you have a distinct advantage. Homes are in demand, inventory is low, and many buyers are sitting on the sidelines anxious to get into their next home.
The 55+ communities however have been moving slower likely due to the fear of Covid-19 and the higher risk it poses on older populations.
Sellers of single family homes can position themselves with great agents like our team to command higher values from their property and stand out amongst their competitors.
We also work with a lot of buyers and we understand many of the challenges they may face in this climate. As it stands, I predict we are going to see continued demand in our area as more people are able to work remotely and live anywhere in the United States.
The best thing you can do to prepare is to understand the current market conditions. Part of the reason we write a lot of articles on our site is to not only educate those that have stumbled upon one of our blog posts, but to offer resources to our currents clients to they stay in the loop.
We hope you’ve enjoyed our monthly updates! If you ever have any questions or anything you’re interested in having us highlight, please reach out to us at firstname.lastname@example.org.
Recommended Articles Of The Month:
For this update, we’ll highlight some must-reads we’ve written:
Top 11 Reasons St. Pete Is The Best City To Move To In Florida – Need anymore reasons to move to St. Pete? Chris wrote a great article on 11 reasons why you should make the Sunshine City your next home.
Top 8 Reasons To Move To The ONE Tower In Downtown St. Pete – Have you been looking for the ONE? Turns out it’s been in St. Pete all this time. Check out this article Chris wrote highlighting one of the top sky-rise condos in the Burg.
Here are some news stories you may love!
The St. Pete Pier Draws Rave Reviews – Just barely opened, the new St. Pete pier is creating even more excitement and buzz about our growing city.
26 Acre St. Pete Pier District – Why have 1 article about the St. Pier when you can have 2? It’s big news!
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