Welcome to the very first episode of The Pinellas Real Estate Show. This will be a real estate show hosted by Ryan Eisenhower streamed on Facebook live. Once the episode is shot, we will transcribe the episode in a blog post on this site for your convenience! If you have any topics you are interested in, or have any real estate needs, please don’t hesitate to reach out to us!
This episode will be covering: Should you keep renting or purchase a home in Pinellas County?
Transcript From Episode #1
Hey, what’s going on everybody! Welcome to the very first episode of the Pinellas Real Estate Show. I’m your host Ryan, and today’s topic is going to be on – Should you buy in Pinellas County or should you continue to rent?
Now this is a live show, this is my very first episode so please bare with me… this is a new thing for me. We’re going to have people popping in, so if you guys have any questions at all during this live broadcast, comment below or on the side… wherever it is and I’ll be happy to get an answer for you.
So back to the topic, the question is: Should you buy in Pinellas County or should you continue to rent? Now this is a really really tough question. I get this a lot… I meet a lot of new people in town, and it’s a lot to consider, and hopefully you guys are going to get a lot more perspective from this.
We’re going to go over the pros and cons of both, it’s not going to be – hey you gotta buy and that’s the only way in the world because it’s not for everybody and that’s what we’ll talk about as we go along.
So again, if you guys have any questions, let me know and let’s go ahead and get to it!
Long-Term Commitment vs Little Commitment
The first thing to consider right now is long-term commitment vs little commitment. Now think about it for a second… when you go and you rent a property, or apartment, a house, a condo, you’re entering into a leasing agreement ( a lease), and in that case usually it’s defined by a certain amount of time.
For most people it’s usually going to take about a year. There are some people that choose to rent for 6 months and there are actually some people that choose to rent for 2 or 3 years.
But the common average Joe is usually entering into an agreement for a year. Now every lease agreement is going to have certain terms in terms of how you can get out of that. Now just to give you some perspective, I’ve lived in several apartments through my life and usually a lot of the apartments, if I were to leave early and break my lease agreement, it would usually be a penalty of 2 months payment that I would have to pay my complex.
There are some complexes… if you’ve gotta get out of town, you gotta go to a different state, they will penalize you for the entire year. So every agreement is going to be a little bit different, but it’s still considered to be short-term.
Now on the other end of the perspective, we have… buying a house. Most people are going to go through financing and the average is usually a 30 year mortgage which is crazy… it’s a ridiculous amount of time, and when you see that on paper it’s almost very overwhelming, but we’ll get into why it’s not that big of a deal a little bit later into the episode.
So you commit to a 30 year mortgage, you’re paying your mortgage – usually your principal and your interests, and then you’re paying any other fees that might be associated with your property such as taxes, home owners insurance, whether or not you have an HOA fee, etc.
It’s a big commitment and a lot of people get overwhelmed, it seems to be a lot easier… (sees users joining show) – Hey Jill! My wife just joined the broadcast and I’m sorry… this is one thing I’m going to work on as everybody joins I will try to give you a shout out, thank you: Bruce, Richard, Kurt, Tom, Jill – my lovely wife, and Chris for joining this broadcast.
If you guys have questions at any point and time, just comment below and let me know.
So going back to commitment, we talked about long-term commitment vs little commitment… it’s overwhelming to people… you look at it, and you’re like ok you know I am not so sure I want the consequences or the burden of having a house, and when you own a house it’s a lot of commitment.
I just bought my house a couple months ago. There’s expenses that come up… you are responsible, so it is a big deal and you have to be ready to take on that ownership in becoming a home owner.
Now… talking about the commitment level, the first thing I like to ask people is are you going to be around for awhile?
For Those New To Florida
If you just moved to Florida… maybe you threw a dart at a map and you said ok, you know this is where I want to be… I want to try it out and see what the Florida lifestyle is like… that’s great!
You probably should at least like the area a little bit before you decide to buy a house. But if you’re liking it, the next question you have to ask yourself is are you gonna stick around for awhile?
If you think you’re only going to be here for a year, and you’re gonna buy a house… well that’s a big commitment because it’s going to depend on whether you’re going to sell the house or you’re going to use that property as an investment.
If you use it as an investment, there’s a lot of pros to that, but if you’re going to sell that house – the cost and the expenses associated with selling a year later… you might not be able to make the money you put in the property or any equity you’ve accumulated in a course of a year.
So it’s not always a good choice for people… (sees more people joining broadcast) – Thank you Jared, and thank you Nick for joining.
I was talking to Nick earlier today and he said I gotta work on not saying umm as much, so I’m going to try to limit it but we’ll see how good I do.
So going back to it… do you want to live in Florida? If you love this area and you’re going to be here for awhile then this is a great opportunity… there is so much happening in this market, St Petersburg, the Tampa Bay Area, all of these areas are popping up all over the map in the United States.
If you go to Forbes.com, they’ve got the top ten places to invest or buy in… we’ve got #1 beaches, this is a great area to be in and anybody that has really experienced a lot of the culture here knows that this is the place to be guys!
I came from South Carolina, I love my hometown… my home state but there wasn’t as much to do there as where we live today. So you guys want to take advantage of it, if you think you’re going to live here for the long-term.
Now going back to the commitment… the approach from an investor to someone that is not sure… if you think you’re going to be in Oklahoma next year and you don’t want to be an investor, you probably want to stick with renting.
If you want to look at it from an investment stand point, one thing you can consider is if you can qualify for a mortgage, and you can buy a property where there’s not any types of leasing restrictions… and let’s say you’re young, and you want to travel the world or you want to go to different states and live in different areas, that’s fine.
Buy a property and rent it out! Use it as an investment, sometimes… the money that you are getting from your rent is more than what you’re paying for your mortgage, your taxes, and everything else. So you can use that cover that… and even put some money in your pocket while you travel the world.
So it’s not a one size fits all… there’s definitely a lot of options for you. (Seeing other users joining) – Thank you Chris and Karen for joining the broadcast, I appreciate you guys!
Today’s topic is we’re talking about should you buy in Pinellas County or should you continue to rent? This is my very first episode of this… so let’s do this!
Equity vs No Equity
The next thing to consider is equity vs no equity. Now when you buy a house you are traditionally building equity in it as long as the market continues to appreciate, and just to let you guys know, in the long-term markets do appreciate.
We do have some downs, we do have market corrections and then there was the recession in 2007 and 2008 – we can get into that in a bit, but in the long term, markets go up.
I know people that bought out here 20 years ago and they bought their property for $30,000, and their home is worth $200,000 or $300,000 dollars today. It’s crazy!
You’re missing out on a lot if you’re just hanging out on the sidelines. When you go out to buy a car, what do you do? Do you lease it… or do you actually buy it? One thing to consider is most people will buy their car, they pay it off in 4 to 6 years and then they own it.
Now the difference between a car and a home is a car is traditionally a depreciating liability. A home can be a liability as well because you’re not making any income off of it… but the difference is when you go to sell that home, if it has appreciated in a normal market, you’re going to have equity in it.
So let’s say for example today you buy a house for $150,000, and let’s say the appreciation is 10% a year (i’m going to try to do my math here, I probably should have gone with an even number…)
So 10% a year and then let’s say you decide to sell that house 2 years from now. So 10% is $15,000 of $150,000 – 10% twice would be $30,000 which would make it $180,000 in 2 years (I hope I did that right).
Now that’s something that sometimes people are like well I need to save up a little bit more money, I’m not sure if I can do this yet, and that’s fine because sometimes it’s a little bit difficult because there are a lot of fees that can be associated with buying a house.
There are also a lot of first time buyer programs out there that can help offset that. But if you are trying to keep up with market appreciation, sometimes… you can’t.
Here’s another example… let’s make it simpler so my math is right.
You take a $100,000 property today, we’re going to put it again in a 10% appreciating market. So 10% next year, that same house is worth $110,000. That’s $10,000!
So let’s say you were trying to save that up in a year to get that $100,000 house, do you have $10,000 that you can save up in that year and are able to deal with the extra costs that it’s going to cost you the following year?
Is it really worth it then?
And then you’ve got interest rates that are going up as well. So again it’s a lot to consider guys and I want to be very real with you.
Any of these things that I’m quoting you, the stats and what not.
I can produce real stats for you so you guys can really see the market in different areas.
For Pinellas County, the average is about a 7% appreciation but I’ve seen some areas go up to 25%. There are some crazy, crazy trends going on right now.
The house that I bought in Seminole, I can already tell that it’s appreciating because we’ve got Seminole City Center Mall that is being built up. It’s bringing a lot of jobs and a lot of industry to the area so that’s going to effect the property values here.
(More users joining the live stream) And we’ve got Sean and Joe joined the broadcast, thank you guys for joining me!
What we’re talking about is equity vs no equity – if you rent, you’re not getting equity, if you buy, you’re building equity.
If you’re renting $1000 a month, that’s $12,000 a year that’s gone, if you’re paying a mortgage that’s $1000 a month – a certain percentage of that based off your interests rate is going into the equity of your home plus the appreciation. So it’s a big deal!
Talking About Market Appreciation
So let’s go back to appreciation, I talk about that a lot. I like to study stats on the market… every single week I’m looking at the county, I’m looking at different cities, I’m looking at different neighborhoods and it’s my job to be up-to-date on this. Because now that I’m a home owner, my next goal is to invest.
I want to own more than one property. I want my properties making income for me. In order to seize the opportunity, I’ve got to stay up to date on what is happening.
I’ll tell you right now St Petersburg is probably the hottest market we have in Pinellas County. If you look at what’s going on in South St Pete, the Skyway Marina, there’s a lot of different areas that are starting to pop up and there’s investors that are seizing the opportunity there and buying up.
Now just because we’re in a seller’s market doesn’t mean that you can’t get a good deal.
If you’re looking at it from that appreciating perspective… now think about this for a minute… if you’re looking at a property and you’re going ok, Ryan I’m ready to stop renting, I want to go look for a property to buy… well if you think you’re going to be there for 5 years and you are open to some of the areas you live in, let’s look at neighborhoods that are appreciating.
And there’s a lot of them! There’s a lot of them you can even do the research yourself… there’s a site which is the property appraiser site, it’s PCPAO.org.
You can go pull any property and you can look at the sales history on it and you can see where it’s coming from. What did it sell for in 2010? What is the market value today? You can do your own research and answer your own questions to see what would have happened if you had bought that property at a certain time and where would it be at today.
Just a lot to consider guys… I hope I’m not repeating myself too much, I know this is my first episode, it’s a lot on my mind, but the big thing that is happening in Pinellas County is it’s the land.
Now think about it… Pinellas County is the most densely populated county in the state of Florida. So what does that mean? That means that developers and people that are trying to build out, they’ve got limited opportunities.
So we’ve got a lot more tear downs that are happening, we’ve got a lot more flippers that are coming into the area and investors that are taking properties that are in poor condition… they’re investing money in… and they’re selling at a premium.
Now those investors… I think they’re a great thing for the market if they do a good job. They are literally turning around neighborhoods so if you live in a neighborhood that’s not so good, and investors are popping up and they are putting in new floors, putting on new roofs, they’re doing things to add value to that house… that helps the entire neighborhood!
So it’s a good thing for this market that we have a lot of people doing that. At the same time, that makes it harder for buyers to get those great deals because they are competing against the investors.
I always encourage people to look at it from the long-term perspective. (More viewers joining the show) Thank you Thomas, Paul, and Kristy for joining the broadcast (laughs), this is really crazy… it’s a lot just talking to myself and looking at a camera guys but this is fun and we’re talking about should you buy or should you rent in Pinellas County since this is the primary market we serve (Chris and I).
Right now we’re talking about appreciation vs no appreciation and we’re going over the value of the land. So let’s take Pinellas County… let’s say you are ready to start searching for a house.
Location, location, location…
Have you ever noticed the closer you go to the beach the higher the prices go?
Or the closer you go to very hot spots, the pricing soars through the roof.
I have people that you can take the same house in Pasco County and it’s double the cost over here in Pinellas County and certain areas. It has to do with the area. This is a trendy area, there are a lot of things that are here that make people want to be here and be a part of it.
A lot of people that I know, they live in St Petersburg and they don’t even want to leave. (Responding to live stream comment) – Hey Elaine, thank you, appreciate it, she said good job.
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The reason why is most of her business is in the Seminole/Largo area where she runs her Salon Suite and I’m a real estate agent so I do a lot of driving and I like to be in kind of the center.
I can get to Clearwater, Dunedin, St Petersburg, Tampa – all in about 30 minutes.
It’s very suburban over here which is good, I have a 16 month old son… so that’s what worked for me. But I also looked at trends and we bought off 113th Street – there’s Seminole City Center Mall. That mall was originally OK… and then it kind of died… well it did die… and there was like a few stores left and a developer came in and they started building it back up.
They put in a Chipotle, they put in an Earthfare… they put in a lot of things that are bringing value back to the area. When we saw our house pop up that we own today that was right near it… we saw an opportunity and a good investment for us.
And things like that happen all the time guys… look around, drive around, and see what events are happening, what stores are opening up, what businesses are coming into the area.
These are all good signs of a growing economy, and you want to position where you live near that.
Because people see value there. People see value in the schools too. So public and private schools.
Maybe you have no plans to have kids and that’s fine but that’s also something to consider when buying a house because that matters to people.
There’s a lot of things to take in guys… but the key thing to remember is what is your buying power today as opposed to last year or as opposed to next year.
If you’re trying to save up money, that’s great, but make sure you look into your options. Knowledge is power… you can contact a lender, they can review your credit, they can go over different programs that are available to you.
Don’t just wait and make your own decision… if it’s something you are considering.
You don’t want to just wait around and hope for the best and hope that things turn around.
Get The Stats You Need
You want to be pro-active with it, so you can decide what is the best choice for you.
Alright… let’s see what else I can talk about!
I think I skipped around a lot of my points, I don’t know if anybody has any questions on this.
One thing we do on our website which is 727team.com is periodically we will take a neighborhood or a city and because we have direct access to the Multiple Listing Service, I can take all of the homes in that area and prepare a nice graph that shows you the average price was $200,000 last year and now it’s $223,000 this year.
And give you perspective on how fast an area is growing… if you guys have a neighborhood that you are interested in learning about… even if you think that you’re not ready to buy yet… just private message me (however you want to get in contact with me) and ask me about it and i’ll be happy to prepare that for you.
Knowledge is power! Thank you… wow… a lot of people have joined (talking to new viewers) thank – you Irvin, Corey, Kristen, and Emily for joining the broadcast… I probably missed a few people, it’s just popping up guys.
I appreciate anyone that’s come and joined this and checked it out. This is really pretty much the end of the first episode.
This was just me getting used to doing the Facebook live thing. What I’m going to do is I’m going to put the episode on our website through a blog post. I’m going to try to transcribe my rambling here to something people can read as well.
And if you guys have questions about anything that has to do with real estate, anything that has to do with the market, just reach out to us!
I’ll be more than happy to help you out with that. Until next time… I’ll see you on the… (question popped up from viewer) – I got suggestions for lenders… Sean, what I’ll do is we do have suggestions for lenders, I’ll send you a private message later and let you know.
We’ve got some great people, they don’t pressure you, they’ll talk to you and go over what some of your options are and that’s the key thing.
It’s just getting that knowledge in and then deciding what’s the right path for you so I will reach out to you after this.
Any other questions before I shut this off and end it… and look over how many times I said umm (laughs).
I think we’re good to go, so again thank you guys for joining me for the first episode.
I think I’m going to try to do this every Tuesday and Thursday and be a little bit more prepared and get better with the topics.
I really want to go over some really cool stuff with you guys – I’m going to have market research for you, I’m going to go over some basic topics (some things I get asked a lot) when people start the real estate process that might be confusing.
Thank you for joining me, I hope everybody has a great day today, make it productive, and I will see you guys next time!
We’d also love to help you get into your next home!
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