Cash Rules Southwest Florida Home Sales

Cash is king in Southwest Florida where the certainty of a quick, uncomplicated home sale can trump a higher offer that’s at the mercy of a bank loan officer.

That’s what local buyers, sellers and brokers alike say, and the sentiment is borne out by a recent report by Irvine, Calif.-based housing data company RealtyTrac.

Among metro areas with 500,000 or more residents, Cape Coral-Fort Myers is No. 1 with 73.6 percent of its home deals in cash in the first quarter, according to the report.

 

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The Naples area wasn’t included in the report because it has fewer than 500,000 residents.

“It’s amazing how much cash offers there are,” said Courtney Neuhausel, co-owner of Fort Myers-based Sandbill Homes, which buys and sells homes and property. “You would think things would be tighter” with the recession still vivid in people’s memories.

He cited an example of a purchase brokered by Sandbill in which the buyer “offered $20,000 under list price, and the seller took it just to have the comfort of knowing it was a done deal.”

But deals don’t always play out that way, Neuhausel said, because someone in no hurry to sell won’t be swayed by the prospects of a speedy transaction.

Still, he said, some sellers — especially of land — buy and sell at a rapid pace and won’t deal with anything but cash offers because they can’t afford the delays and the uncertainty that go with financing.

When Sandbill buys land, Neuhausel said, he has to close the deal quickly and irrevocably. “If I have a nonretractable contract and I put $5,000 down, I don’t want to walk away from that money.”

Jeff Tumbarello, owner/broker of North Fort Myers-based Steelbridge Realty, said the difference between cash and carry can cut both ways.

A cash buyer using his own money might be unwilling to bid up to the price needed to close the deal in a rising market, he said, while “a leveraged buyer will pay more” because he’s financing the deal with a loan.

In that case, Tumbarello said, “the narrative favors the leveraged buyers, who are able to respond more to the sellers.”

Bob Knight, co-owner of Cape Coral-based Paul Homes, said that for a buyer having a house built, there’s been a recent shift back toward financing.

“During the recession it was more cash for building new construction because it was difficult to get financing,” he said. “Banks were still reeling because of what happened. Now, in the past 18 months, the banks have opened up a lot more.”

As a result, Knight said, some of his clients who have the wherewithal to simply write a check are financing because low interest rates make that a more attractive proposition.

From a builder’s perspective it’s a wash, he said. On the one hand, “With the bank, the money’s in place and it will be to the end of the project. It’s more work, though, dealing with the bank’s regulations.”

Dealing directly with a buyer is generally simpler but the builder has to make sure he’s good for the total cost of the project,” Knight said. In the end, “It’s probably about the same amount of time.”

Mike Diamond, of Diamond Custom Homes, who builds upscale houses in Lee and Collier counties, said his clients generally can pay cash although sometimes they choose strategically to use a private banker or a line of equity. “Most of these people aren’t obtaining a mortgage.”

Also, he said, a lot of customers simply have a lot of cash lying around with no attractive options to invest it: interest rates are low and the stock market is arguably over-bought after five years of strong gains.

“There’s just a lot of cash on the sidelines,” Diamond said.

Zillow: Buy A Home In Southwest Florida

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To the age-old question of whether to buy or rent, Zillow has an answer: buy if you live in Southwest Florida.

The Seattle-based real estate data collector says in a recent survey that people in Lee, Collier, Charlotte and Hendry counties have better odds than most of the country of coming out ahead if they buy.

Nationally, buying is a good decision for people who plan to stay in the home for at least two years, according to an analysis of first-quarter financial data.

But what Zillow calls the “breakeven horizon” is much shorter here: 1.1 years for Lee County; 1.0 for Collier; 1.1 for Charlotte; and 0.7 for Hendry.

Commercial real estate agent Jim Garinger of Colliers International Southwest Florida said Zillow’s analysis is borne out by what he sees in the apartment complex market.

“Traditional apartment complex occupancy has become stronger over the past 12 months or so,” he said. “There’s been a significant increase across the board but especially in Class B apartments.”

As that’s happened, rents have increased as well, Garinger said.

The average apartment complex in the Fort Myers area in March had a vacancy rate of 96.7 percent, up 1.8 percent from March 2013, according to Carrollton, Texas-based ALN Apartment Data.

In the same period, the average monthly rent rose 7.9 percent to $920, ALN’s report says.

Even as occupancy rates and values rise for apartments, however, lenders are still skittish about financing multi-family housing, Garinger said.

“Lenders are still looking at comparable sales as distressed properties,” which makes them reluctant to finance purchases or new construction, he said.

That problem will resolve itself with time, Garinger said, but meanwhile “If you’re a renter, it’s a great time to buy if you can swing it. As occupancy rates increase, rents are increasing as well.”

Home prices are also going up and interest rates are still historically low, contributing to the advantage of buying, he said.

There’s no shortage of prospective home buyers.

The share of Americans who own their homes was 64.8 percent in the first quarter, down from 65.2 percent in the previous three months, the Census Bureau said. The rate is the lowest since the second quarter of 1995, when it was 64.7 percent.

Condo Market In SW Florida On The Rebound

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Mike Banson recently handled the last sale of a bank-owned condominium at the 13-floor North Star Yacht Club on the Caloosahatchee River in North Fort Myers.

That’s a sign of the times in Southwest Florida, where the condo market has enjoyed a resurgence in the past year as single-family prices bounced back from the depths of the recession.

“I was the on-site agent for about six years, selling out all the bank-owned units,” said Banson, of Vision One Realty Group — the last unit, a penthouse, went for $531,000.

Naples-based land-use consultant Michael Timmerman, president of MJT Realty Economic Advisors, said the condo sector is doing well for sales prices, although for larger projects the cost of construction still makes it impossible to build new ones.

Projects building on a smaller scale have had better luck.

Jeff Barney, spokesman for Santa Luz LLC, said the company’s condominium Santa Luz, which started sales in February, is sold out of all but two units of the 20 in its first phase.

The project, off Daniels Parkway east of I-75 near JetBlue Park, consists of buildings with four units in each one.

“We had a very busy season,” said Barney, adding that another eight units will go up for sale within three weeks with 36 more to come.

“Most of the buyers we have are snowbirds and what they really get drawn to is the maintenance-free lifestyle,” he said. “They can leave for six months and come back and everything looks exactly the same.”

Because of its location in Gateway, Barney said, “We’re getting some young families. The last two we sold have been to folks about 40.”

Commercial real estate broker Steve Luta said he thinks there will be interest by builders in smaller projects in and around downtown Fort Myers.

That could offer a more urban lifestyle with buildings situated near the jobs, restaurants and nightlife of downtown, he said. “Some people don’t want the single-family home, lawn maintenance, pool, and all that stuff.”

Gary Tasman, founder and executive director of Cushman & Wakefield Commercial Property Southwest Florida, said new construction such as Santa Luz and Neill Communities’ Villa Palmeras, are selling well in Lee County.

“There are already home builders building condos and they’re selling as fast as they can get out of the ground,” he said.

There would be a market for new high-rise condos as well, Tasman said, but that sector — hard hit when the market imploded at the end of 2005 — is still being sold cheaply enough that the cost of new construction is far more than buying an existing one.

Banson said that’s the case at North Star, where “a lot of the units may be in the $150-per-square-foot range. It would take $300 a square foot to build this product again.”

Towers will first rise again directly on the Gulf of Mexico between Estero to Marco Island, he predicted.

For that type of construction, “The prices need to push $500 a foot to be viable right now,” he said. “It’s probably $400 right now.”

Still, Tasman said, prices are rising fast and new Gulf-front towers may come sooner rather than later. “It wouldn’t surprise me if we hear an announcement of a new Gulf Front tower within the next 12 months.”

Connect with this reporter: @DickHogan (Twitter) or email dhogan@news-press.comBy Dick Hogan

Condo costs

The cost per square foot of building a Gulf-front skyscraper condominium:

• $250 hard construction costs

• $75 soft costs (marketing, advertising etc.)

• $81 25 percent developer profit

• $101 land

Things to do in Southwest Florida: April 25-May 4

Friday

Jennifer’s 10th Annual Art of a Woman Exhibit A variety of works will be showcased, including abstract and realistic painting, contemporary raku clay creations, painted furniture and whimsical sculptures. All will be available for purchase. 10 a.m.-6 p.m. April 14-26 at Jennifer’s Fort Myers boutique, 13451 McGregor Blvd., Fort Myers, 481-8582

 

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Duo Romantico The singing couple performs opera, “popera,” musical-theater music and more at their last concert before going on tour. 7 p.m. $25. Italian-American Club of Cape Coral, 4725 Vincennes Blvd., Cape Coral. 332-1853

Rock the Dock This two-day event featuresfood and live entertainment by Deb and The Dynamics from 6-9 p.m. on Friday, followed Saturday by The Rachel Hughes Duo from 10:30 a.m.-1 p.m., the Cracker Blues Band from 2-5 p.m. and The Landsharks from 6-9 p.m. Marina at Edison Ford, 2360 W. First St., Fort Myers, 245-7320. marinaedisonford.com

 

Saturday

Balloons Over Paradise The two-day event features 60 hot-air balloons and performances by Sister Hazel, Rachel/Hughes Band and JJ McCoy. There will be delicious food, arts and crafts, tethered balloon rides, classic car show, dog agility performances, a polo exhibition and an equestrian drill team performance. 6 a.m.-noon. Seminole Tribe Youth Ranch Immokalee, 1195 State Road 29, Immokalee. 800-218-0007. seminoleimmokaleecasino.com

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• Fort Rock at JetBlue Park One of the biggest metal festivals to ever hit Southwest Florida. With 15 bands on two stages, the lineup includes Rob Zombie, Five Finger Death Punch, Korn, Trivium, The Pretty Reckless, Lacuna Coil, Seether, Sick Puppies, Twelve Foot Ninja andBlack Stone Cherry. 11 a.m. to 11 p.m. Saturday. JetBlue Park, 11581 Daniels Parkway, Fort Myers. $54.50-$109.50 (excluding taxes and fees, prices subject to change). Parking: $15. Info: Fortrockfestival.com

 

Drive the Lane Celebrity Basketball Game This event is presented by MADD SWFL and Lee County Coalition for a Drug Free Southwest Florida. Hometown champions Earnest Graham and Jevon Kearse, as well as Jeff Dellenbach, Daunte Culpepper and Antonio Freeman, all former NFL players, will participate on the court. Our local heroes, law enforcement officers, firefighters, high school principals, coaches and student athletes will be their teammates. 1-4:30 p.m. $5 adults, $2 students. Bishop Verot High School 5598 Sunrise Drive, Fort Myers. 791-7560. madd.org/drivethelane

Fight for Air Stairclimb The Stairclimb raises money for the American Lung Association by collecting pledges to ascend the stairway of High Point Place, the tallest building between Tampa and Miami. Teams can practice on Saturday mornings once they’ve registered. $25 registration fee; each climber must raise $100. High Point Place, 2104 W. First St., downtown Fort Myers, 908-2685. fightforairclimb.org

Sunday

Sunday Blues Benefit Great food and music will be served up at The Heights Foundation’s Sunday Blues from 2-6 p.m. Musicians Randy Thomas, Danny Shepard and Doug Molloy will entertain guests and Jake Elwood and friends will make a special appearance. The buffet features The Blue Coyote’s creative and original menu items. $50 per person; sales of wine and the Bacon & Egg Bloody Mary will be donated to The Heights Foundation. Blue Coyote Supper Club, 1100 Par View Drive, Sanibel Island. 472-9222. heightsfoundation.org

Florida Gulf Coast University Chamber Choir in Concert Admission is free for this concert, however there will be a free-will offering during the performance. 4 p.m. North Naples United Methodist Church, 6000 Goodlette Road N., Naples, 593-7600.

Taste of North Fort Myers Sample local food and drinks while enjoying entertainment, a car show, free kids games and activities, free petting zoo, raffles and more. 11 a.m.-4 p.m. $3 per person, free for ages 5 and younger. Shell Factory and Nature Park, 2787 N. Tamiami Trail, North Fort Myers. 997-9111. tasteofnorthfortmyers.com

 

Monday

Black & White Party, an Evening of Beauty & Fashion This event celebrates the new Redken Premiere School of Cosmetology. Features hair by Redken 5th Ave stylists, a catwalk fashion show provided by White House Black Market and Fantasy Makeup by Cara and the FL Academy. RSVP to floridaacademy.eventbrite.com. 6-8 p.m. Florida Academy of Massage and Skin Care, 4387 Colonial Blvd., Fort Myers, 489-2282.

Wednesday

Boz Scaggs The singer-songwriter is on tour in support of his new release “Memphis,” showcasing both original songs and choice covers. 7:30-9:30 p.m. $49.82-$81.62. Barbara B. Mann Performing Arts Hall, 8099 College Parkway, Fort Myers, 481-4849 or bbmannpah.com

Thursday

Prism Concert The Fort Myers High School music department will be divided into its varied components. You will hear and see the full instrumental, choral, dance groups, and a variety of soloists and small ensembles. 7 p.m May 1-2. $8. Fort Myers High School, 2635 Cortez Blvd, Fort Myers, 334-2167. fmhsgreenwave.net

• ArtsNaples World Festival Venetian Masquerade This event kicks off the weeklong arts festival in Naples. An Italian Carnevale atmosphere combines with a gourmet multicourse dinner and unique musical surprises. Guests’ attire to be Black Tie & Mask, or Masquerade Costumes. 7-10 p.m. Individual tickets $350 or $2,400 table for 8. The Club at Olde Cypress, 7165 Treeline Drive, Naples. 888-613-8488. ArtsNaples.org

May 2

Digital Lee Showcase 2014 A design and technology showcase of the most exceptional student projects from the Lee County Public School District. This year’s exhibit will debut on May 2 at 6 p.m. The competition is open to Lee County’s middle school, high school and post-secondary programs in graphic design, animation, publication design and Web design. Artwork will be displayed until May 22. Sidney & Berne Davis Art Center, 2301 First St., downtown Fort Myers, 939-6326. digital-lee.com

• Art Walk The free, monthly art event takes place from 6-10 p.m. the first Friday of every month. Art galleries and other businesses stay open late for art shows, live music, an after party and more. Downtown Fort Myers. fortmyersartwalk.com

May 3

13th Annual Free Comic Book Day A single day when participating comic book shops across North America give away free, specially produced comic books. Comics Cards and Stuff will promote the event with a large sale raffle and special giveaways, along with appearances by several “superheroes” and Star Wars Stormtroopers. 10 a.m.-5 p.m. Comics Cards & Stuff, 3563 Fowler St., Fort Myers. 939-0878. facebook.com/fortmyerscomics

May 4

19th Annual Taste of the Beach featuring Baywalk Blues Festival Restaurants along Old San Carlos Boulevard, on Fort Myers Beach, will offer samples of their signature dishes and compete for top Taste of the Beach Award honors. Gates open at 11 a.m. Food will be served until it runs out or at 5 p.m. Tickets will be available on site. Admission is $5 for adults and children over 12. Food tickets are $1 each with a $5 average food serving price. 454-7500. tasteoffortmyersbeach.com

Third Annual International Food Festival Sample international cuisine from eight Mercato restaurants and enjoy live music. Most menu items will be priced less than $6. Kids’ Zone available featuring bounce house, arts and crafts and many other fun activities. Location: lawn next to MASA. Noon-4 p.m. Mercato Shops, 9115 Strada Place, Naples, 254-1080. mercatoshops.com/event/3rd-annual-international-food-festival/2145431190

Fleamasters’ Best-Dressed Chihuahua Contest event begins at 1:30 p.m. with registration beginning at 11 a.m. Enjoy a special performance by the Calendar Girls Dance Team at noon. Registration is $10 per dog. Fleamasters Fleamarket, 4135 Dr Martin Luther King Jr, Fort Myers, 334-7001. fleamall.com

The Heights Foundation and Lee Reefs Present LionFish Fest – Feast on the Beast On Sunday, May 4 from 2-5 p.m. Join celebrated local chefs from Crave Culinaire, Three Fishermen, Red’s Seafood, Cru and The Timbers, as they present a unique twist on Florida fare. Guests will vote for their favorite dish. The event will include door prizes, fun auction items, a signature tropical drink and live music, as well as displays about Lionfish and our reefs. Mitch and Billy of ScubaNation television will be on hand showing their underwater videos. Katie Walls of WINK News will emcee the event. Admission is $50 per person, children under 12 are admitted free. Harlem Heights Cultural Arts and Community Center, 15570 Hagie Drive, Fort Myers, 482-7706. heightsfoundation.org

Lee-Collier Population Hits 1 Million

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A million people now live in Lee and Collier counties, according to the U.S. Census Bureau.

Lee County is among the fastest growing metropolitan areas in the nation, according to Census Bureau information released Thursday.

Lee was the 10th fastest-growing metro area in the country with 2.5 percent growth in the year ending July 1, 2013, and now has an estimated population of more than 660,000 residents.

Collier County, which grew at a 2.1 percent rate during the same period, now has roughly 340,000 residents.

Overall, Lee County ranks 56th and Collier County 95th, respectively, in percentage growth nationwide for counties with 10,000 or more population.

The Villages, home to one of the nation’s largest retirement communities, topped the list of fastest-growing metro areas in the nation. The Villages grew by 5.2 percent and now has a population around 100,000 residents. Sumter County, which is home to The Villages, also was one of the nation’s fastest-growing counties.

The Census Bureau says the South Florida area, made up of Miami, Fort Lauderdale and West Palm Beach, was the nation’s eighth most populous metropolitan area with 5.8 million residents.

Elsewhere, America’s energy boom is fueling population growth west of the Mississippi River.

Six of the 10 fastest-growing metropolitan areas and eight of the 10 fastest-growing counties in the country are in or near the oil- and gas-rich fields of the Great Plains and Mountain West.

More and more oil and gas drilling is being done in those regions, drawing people from around the nation looking for work, the Census Bureau said.

No Spring Slowdown for New-Home Sales?

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Single-family new-home sales surged in January to a five-and-a-half-year high, giving the industry new hope that the new-home sector isn’t heading for a slowdown this spring after all.

New-home sales rose 9.6 percent to a seasonally adjusted annual rate of 468,000 units in January, the highest level since July 2008, the Commerce Department reports.

Regionally, new-home sales  in the South jumped 10.4 percent.

“The fact that the cold weather that hit much of the country didn’t stop home buyers from going out and purchasing a piece of the American dream is a great sign,” says Kevin Kelly, chairman of the National Association of Home Builders. “However, the very low supply of new homes on the market and the continued concern of available buildable lots still have builders cautious about getting ahead of themselves.”

The inventory of new homes for sale held mostly steady in January, remaining at a tight 4.7-month supply at the current sales pace. Last month, housing starts had posted their largest decline in nearly three years, sparking concern that the new-home sector was headed for a downward spiral with rising mortgage rates and home prices.

But in January, new-home sales increased 2.2 percent from a year ago, and the median price of a new home rose 3.4 percent to $260,100 compared to year-ago levels. The pace of home-price rises has slowed in recent months, the Commerce Department notes.

How to Tell When a Neighborhood Will Be Hot!

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Bargain-hunting home buyers willing to purchase in an up-and-coming neighborhood can get a good deal and, as Trulia’s Michael Corbett says, “get in on the ground floor of appreciation.”

Here are five signs that a neighborhood is about to take off:

  1. An up-and-coming neighborhood often is characterized by retail or residential construction that is already in progress.
  2. They also often are found where trendy establishments, such as wine bars or farm-to-table restaurants, are opening.
  3. Buyers also should look for neighborhoods adjacent to big cities or those where crime is on the decline.
  4. Public building projects are on the rise.
  5. Renovated homes are going on the market.

The State of the Union is Getting Better for Homeownership

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WASHINGTON (January 28, 2014) – The following is a statement by National Association of Realtors® President Steve Brown:

“NAR commends President Obama for highlighting two key policy reforms during his State of the Union address tonight that support the future of homeownership and the business of real estate.

“Realtors® welcome the President’s call for legislation to keep the dream of homeownership alive for all Americans while protecting taxpayers from the risk of costly bailouts. NAR supports bipartisan legislation in the Senate that will restructure the secondary mortgage market to encourage private capital while also preserving the government guarantee so that middle-class homebuyers continue to have access to safe, reliable mortgage products, such as 30-and 15-year fixed-rate loans.

“President Obama also called on Congress to pass legislation to curtail the frivolous patent infringement lawsuits and licensing schemes that have unnecessarily cost Realtors® and other main street businesses valuable resources. NAR is working closely with legislators and allies to draft patent reforms that will combat these abusive trolling practices.

“NAR is ready and willing to work with President Obama and Congress to develop sound policies to promote and protect the American dream of homeownership.”

The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1 million members involved in all aspects of the residential and commercial real estate industries.