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As we head into a new year, the most common question we receive is, “What’s the outlook for real estate in 2018?”
It’s not just potential buyers and sellers who are curious; homeowners also want reassurance their home’s value is going up. The good news is that a strong U.S. economy, coupled with low unemployment rates, is expected to drive continued real estate growth in 2018. However, changes on the horizon could significantly impact you if you plan to buy, sell or refinance this year.
HOME VALUES WILL CONTINUE TO RISE
Get ready for another strong year! U.S. home values and sales volume will continue to rise in 2018.
Experts agree that home prices will increase in 2018, but predict a slower rate of appreciation than 2017, which clocked in at nearly 7 percent nationwide. National Association of Realtors (NAR) Chief Economist Lawrence Yun predicts a growth rate this year of 5.5 percent,1 while Freddie Mac’s September Outlook Report forecasts a rate of 4.9 percent. Either way, all indicators point towards continued growth in 2018.2
What does it mean for you? If you’re a current homeowner, congratulations! Real estate proves once again to be a solid investment over the long term. And if you’re considering selling this year, there’s never been a better time. Contact us to request a free Comparative Market Analysis to find out how much you can expect your Sarasota suncoast home to sell for under current market conditions.
If you’re in the market to buy this year, there’s good news for you, too. Although prices continue to rise, the rate of appreciation has slowed. Still, don’t wait any longer. Prices will continue to go up, so you’ll pay more six months from now than you would today. Call us to setup a free, no-obligation property search and get notified about listings that meet your criteria as soon as (or before) they hit the market.
NEW CONSTRUCTION WILL MAKE REAL ESTATE MORE ACCESSIBLE
Lack of inventory in the housing market has been a primary impediment to homeownership for many Americans. “Ten years ago, the problem in the housing market was lack of buyers,” says Yun. “Today, the problem is lack of sellers. Inventory levels are near historic lows.”3
Yun also notes, “The lack of inventory has pushed up home prices by 48 percent from the low point in 2011, while wage growth over the same period has been only 15 percent. Despite improving confidence [in 2017] from renters that now is a good time to buy a home, the inability for them to do so is causing them to miss out on the significant wealth gains that homeowners have benefitted from through rising home values.”1
The good news? Yun expects a 9.4 percentage point increase in single-family new home construction starts.4
Economists at Freddie Mac make a similar prediction. “Existing home sales are unlikely to increase much going forward. Limited inventory will remain a consistent problem … Growth in home sales will be primarily driven by new home sales, which should continue to grind higher with single-family construction.”2
Robert Dietz, chief economist at the National Association of Home Builders, agrees. “The markets that are going to grow are ones where builders can add that entry level product.”5
What does it mean for you? If you’ve been frustrated by lack of inventory in the past, 2018 may bring new opportunities for you to find a budget-friendly home that suits your needs. Give us a call to discuss options for new construction in our area.
Beverly Bowen and John Schnackenberg are both Certified New Home Specialists (CNHS) and Residential Construction Certified (RCC). Contact us before you look at new homes and we can guide you through the process – it does not cost you anything extra to be represented.
MILLENNIALS WILL MOVE TO THE SUBURBS
The new entry-level construction will come with a catch though … it will be located in the suburbs, where the availability of land and fewer zoning requirements make it more cost-effective to build. Economists predict that’s where millennials and first-time buyers will flock for the greater variety of homes at affordable prices.6
Rising home prices, a sluggish job market, and an increase in student loan debt made homeownership largely unattainable for many millennials in past years. However, there’s significant evidence that this trend is turning around. For the fourth year a row, the National Association of Realtors’ 2017 Home Buyer and Seller Generational Trends survey found that millennials were the largest group of homebuyers.7
As millennials age, they are settling down and having families, which has prompted an increasing demand for larger but affordable homes. Thus, many are flocking to the suburbs, with 57 percent of millennial buyers opting for a suburban location.
What does it mean for you? If you’re a millennial who has been priced out of urban living, or is looking for more space for your growing family, a number of suburbs in our area have a lot to offer. We can point you towards the communities that will best meet your needs.
And if you’re a suburban homeowner with plans to sell, give us a call. We know how to market your home to millennials … and can help you sell quickly for top dollar by appealing to this growing market segment!
BOOMERANG BUYERS WILL RETURN TO THE MARKET
“Boomerang buyers” comprise the nearly 10 million Americans who lost their homes to foreclosure or short sales during the housing recession of 2006 to 2014.
According to MyFico.com, a foreclosure remains on a credit report for seven years. It takes many boomerang buyers at least that long to raise their credit score and save up enough cash to qualify for a new mortgage.8
With this “seven-year window” in mind, RealtyTrac predicts that the largest wave of boomerang buyers – more than 1.3 million – will be eligible to re-enter the housing market in 2018.9
Markets likely to see the highest influx of boomerang buyers are those that had a high percentage of foreclosures AND have remained affordable. That includes Florida. The majority of boomerang buyers are middle-class Gen Xers or Baby Boomers. Expect to see even more competition for entry-level homes in those markets.
What does it mean for you? If you’re a boomerang buyer, we understand your unique circumstances. We can help you navigate the real estate process and write competitive offers that will play to your strengths. Contact us to discuss your options.
NEW TAX LEGISLATION WILL IMPACT HOMEOWNER DEDUCTIONS
The “Tax Cuts and Jobs Act” passed at the end of 2017 nearly doubles the standard deduction, so far fewer Americans are expected to itemize this year. For those who do, however, it could mean less homeowner deductions are available than in the past.
Previously, homeowners could deduct interest paid on the first $1 million of mortgage debt, but that threshold has been lowered to $750,000 for new mortgages. (Existing mortgages will not be impacted.)
Additionally, taxpayers will no longer be able to fully deduct state and local property taxes plus income or sales taxes. The new legislation restricts this deduction to $10,000. It also eliminates the deduction for moving expenses (except for members of the Armed Forces) and interest on home equity loans unless the proceeds are used to substantially improve the residence.10
We are already seeing an increase in real estate activity of people wanting to have Florida as their primary residence since we do not have state income taxes.
It’s yet to be seen how the tax bill will impact the real estate market overall. While some economists predict a price reduction in certain markets, Republican lawmakers project the bill will increase take-home pay and stimulate the economy overall. According to Realtor.com Senior Economist Joseph Kirchner, “Some house hunters—particularly wealthy buyers—will see an increase in after-tax income, making an already tough housing market even more competitive. This increased demand could drive prices up even higher than they are already.”11
What does it mean for you? If you’re an existing homeowner, be sure to consult a tax professional if you’re concerned about the impact the new tax bill could have on you.
And if you’re planning to buy or sell this year, we can help you determine how the tax bill could affect demand in your current or target neighborhood and price range.
INTEREST RATES WILL RISE
No one knows exactly what will happen with mortgage rates this year, but the Mortgage Bankers Association anticipates the Federal Reserve will raise rates three times in 2018, with Freddie Mac’s 30-year fixed rate mortgage reaching 4.8 percent by the end of Q4, up from around 4 percent at the end of 2017.12
Kiplinger.com Economist David Payne also predicts interests rates will rise this year, with short-term rates outpacing long-term rates as the Fed aims to curb inflation in a tightening job market. He predicts the bank prime rate that home equity loans are based on will increase from 4.25 percent to 5 percent by the end of 2018. 13
What does it mean for you? If you’re in the market to buy, act now. Rising interest rates will decrease your purchasing power, so act quickly before interest rates go up. Give us a call today to get your home search started.
And if you’re a current homeowner who is considering refinancing or a home equity loan, don’t wait. We can help you estimate your property’s fair market value so you’ll be prepared before contacting a lender.
|2018 ACTION PLAN
If you plan to BUY this year:
If you plan to SELL this year:
WE’RE HERE TO HELP
While national real estate numbers and predictions can provide a “big-picture” outlook for the year, real estate is local. And as local market experts, we can guide you through the ins and outs of our market, and the local issues that are likely to drive home values in your particular neighborhood. If you have specific questions, or would like more information about where we see real estate headed in our area, please give us a call! We’d love to discuss how issues here at home are likely to impact your desire to buy or a sell a home this year.
Give us a call for Market Statistics for the Sarasota Suncoast real estate market.
Call Beverly and John at RE/MAX Alliance Group – 941-321-3916
Thank you to all who helped make our second annual drive for items to help our local veterans a huge success. December has become a unique time to demonstrate caring for the Sarasota Suncoast’s homeless veterans and their families. Our deciding to make this an annual event was easy.
Using online communication to reach out to our local community, items were donated through us to the veterans. Our family, friends and neighbors contributed items and we delivered them to the wonderful organization that does so much good in our community. The creative sincerity people showed our veterans that are having a touch time is an inspiration and motivation to continue every year.
Sarasota is truly blessed to have such considerate, giving people. Their enthusiasm is refreshing and powerful. Living and sharing Paradise with generous people that give gifts to our homeless veterans is humbling.
Operation Military Assistance is headed by Jocey Henderson. Jocey is the Director of Veterans Services who served our country in the Army for over 30 years and achieved the rank of Command Sergeant Major before retiring. She continues to serve our country by working with our local veterans.
They work with Veterans and their families who are homeless or at risk of homelessness. Their goal is to help the families find housing and provide wraparound services for them.
The donations we brought are greatly needed and they also always have a need for working bicycles to help the homeless veterans that lack transportation and therefore, unable to engage in services.
Coming up in April they will be hosting Operation Standdown in partnership with many other local organizations to provide a day of caring and respite for our local homeless veterans. It will be at Payne Park and the veterans can come and receive food, clothing, haircuts and all kinds of services that they do not otherwise have access to.
Thank you all again for helping us to help our veterans that have served our country.
If you would like happy, caring Realtors to help with your real estate needs on the Sarasota Suncoast, contact Beverly and John at 941-321-3916.
“Communities work better (students perform better, crime rates are lower, kids are safer, people live longer) when neighbors know one another better. Knowing your neighbor on a first-name basis…is a surprisingly effective first step.”
– Robert Putnam, Harvard Public Policy Professor and author of Bowling Alone
While advancements in technology have made it possible for us to connect with people from around the world, numerous studies show that it has led to a decline in face-to-face interactions.1
Places where we used to strike up casual conversations—such as a doctor’s office waiting room, bus stop or grocery line—are now filled with people looking at their smart phones, barely acknowledging those around them.
Even many families dining together or relaxing in the evenings can be caught spending more time focused on screens than each other. Is it any surprise that we’ve experienced a steady decline in community involvement?
In his book Bowling Alone, Harvard Public Policy Professor Robert Putnam “draws on evidence including nearly 500,000 interviews over the last quarter century to show that we sign fewer petitions, belong to fewer organizations that meet, know our neighbors less, meet with friends less frequently, and even socialize with our families less often.”2
How is this shift impacting our overall well being? A study by Oregon Health & Science University researchers found that having limited face-to-face social contact nearly doubles an individual’s risk of depression.3
CONNECTING WITH YOUR COMMUNITY
If you’re considering a move to a new city or neighborhood, you may be worried about replacing the comfort and support of family and friends you’ll leave behind. Or perhaps you have completed a move but would like to meet more people, build friendships and strengthen your support system.
In this blog post, we’ll explore 10 ways you can utilize technology to foster in-person connections with your neighbors, make friends and get engaged in your local community.
A growing number of neighborhoods are utilizing private social networks like U.S.-based Nextdoor and Canadian-based GoNeighbour. These platforms are designed specifically to connect neighbors and include an address verification process.
Residents post about a variety of topics, including neighborhood news, recommendations for local businesses, lost pets, etc. These platforms are a great way to stay up-to-date on what’s happening in your neighborhood, but don’t just use them to connect virtually. Extend an invitation to your neighbors to attend an in-person event, such as a park playdate for families, an informal soccer game or a potluck block party.
If you have a religious affiliation, joining a local place of worship is great way to meet people and get involved in your community. Aside from attending services, most religious institutions also host extracurricular activities to foster fellowship amongst the congregation.
Whether you are looking to join a church, synagogue, mosque or temple, there are a variety of online resources available to help you find a match in your area, including:
To make the most of your affiliation, look for opportunities to meet in smaller group settings. It’s a great way to form interpersonal relationships with people who share your beliefs and values.
Whatever your favorite hobby or pastime, you’re guaranteed to meet people who share your interests when you join an interest group!
The website Meetup.com has over 32 million members in 288,000 groups in 182 countries. You can search for a group in your area that appeals to you … from book clubs to running groups to professional networking, they have it all.
If you don’t find what you’re looking for, you can start your own group for a monthly fee. The site makes it easy to ask (or require) members to pitch in to cover the cost. It also enables you to promote a corporate sponsor on your page, so you may be able to find a local business to cover the cost.
Most people who join Meetup are there for the same reason you are … to meet people who share their interests. So it’s a great place to make like-minded friends in your community.
Volunteering your time and talents is another good way to get engaged in your community and meet those who share a similar mission.
Most nonprofit organizations rely heavily on volunteers. Find one with a cause you’re passionate about by visiting VolunteerMatch.
You can search by cause, location and keywords, and filter your results to include opportunities that are suitable for kids, seniors or groups. Another option is to search for volunteer positions that require specialized skills. Perhaps you’re musical or maybe you’re good with computers. There could be an organization in your area that needs your talents or skills.
Lotsa Helping Hands is another site focused on connecting volunteers with those in need. Members can request help or search for opportunities to assist others in their area. Most of the volunteer opportunities involve aiding neighbors who are ill or elderly by delivering meals, offering rides to appointments or just stopping by for a visit. This can be a great way to make a direct impact on your neighbors who need a helping hand!
Taking a class is a wonderful way to develop a skill while meeting people who share your interests and passion for learning.
Whether you want to brush up on your Spanish, finish your novel, or learn how to tango, most community colleges offer inexpensive, non-credit classes on a variety of topics.
And if you are pursuing a degree, forego taking your courses online. Opt for the traditional route instead. There’s no substitute for being part of a live community of your peers.
Attending a live event is another way to engage with members of your community. From festivals to fundraisers to retreats, Eventbrite is a great place to search for events in your area. You can filter your search by category, event type, date and price to find something that fits your interests, schedule and budget.
Be strategic about the type of event you choose. For example, while attending a large festival might be a fun way to feel engaged with your community, it might also be harder to meet people. A retreat or a networking event may offer more opportunities for one-on-one interaction.
Everyone’s talking about the rise of the “sharing economy” with the popularity of Uber and Airbnb. But there’s also been a rise in “sharing communities,” which facilitate the free exchange of goods among neighbors to reduce consumption and keep usable items out of landfills.
Nonprofit groups like The Freecycle Network are made up of people who are giving (and getting) stuff for free in their own towns and neighborhoods. Members can post “offers” of free items or “wanted” items they need.
The company Peerby has a similar goal of reducing consumption by encouraging neighbors to lend and borrow items they don’t often use. For example, you can offer to share your blender, rake or ladder. Maybe you need to borrow a drill, cake pan or moving trolley. Peerby enables you to request items to borrow from your neighbors and encourages you to register items you are willing to lend.
The Little Free Library is another innovative way neighbors are participating in a sharing community. Stewards build or purchase a box to house the library and fill it with books they are willing to give away. The library is usually placed in their front yard or in a public outdoor space. Visitors are encouraged to take a book they’d like to read, and in exchange leave a book for someone else to enjoy. With over 60,000 libraries in 80 countries, the organization estimates millions of books are exchanged annually among neighbors.
Community gardens have become increasingly popular in both urban and rural areas across North America. Not only do they beautify a neighborhood, they also foster community, encourage self-reliance, reduce family food budgets, conserve resources, and provide opportunities for recreation and exercise.
The mission of the American Community Gardening Association is to build community by increasing and enhancing community gardening and greening across the United States and Canada. The organization’s website enables you to search for existing community gardens in your area. If there isn’t one nearby, you might consider starting one. The site provides helpful tips and resources for organizing a garden in your neighborhood.
In the spirit of joining a “sharing community,” carpooling offers many similar benefits. It presents an opportunity to form a bond with coworkers and/or neighbors during your daily commute. Additionally, you can save money on gas, reduce wear-and-tear on your vehicle, lower carbon emissions, and in many cities reduce your commute time by taking advantage of high-occupancy vehicle (HOV) travel lanes.
The success of ridesharing companies like Uber and Lyft has spurred a new wave of carpooling websites and apps that aim to revolutionize the way we commute by making it easier and more convenient to carpool. While many of these are still in their infancy stages, they are expanding into new markets and improving functionality at a rapid pace.
Kangaride Local, Scoop and Waze Carpool are just a few examples, and more are popping up every day. They are currently available in limited markets throughout the United States and Canada, but are becoming prevalent in more cities as residents opt-in. Check to see if any of these are available in your local area.
Alternatively, you can try posting on your neighborhood’s social network to see if one or more of your neighbors are commuting to a nearby location. Take turns driving and start benefiting from all that carpooling has to offer!
The organizers behind World Neighbors Day promote it as “an invitation to share a moment with your neighbors, to get to know each other better and develop a real sense of community.”
In Canada it’s held on the second Saturday in June, and in the United States it’s held on the third Sunday in September. Participants are encouraged to organize gatherings with their neighbors to build relationships that “form the fabric of our communities.”
You can participate by attending or organizing a gathering in your neighborhood. Examples include: a block party, outdoor movie screening, book exchange, charity bake sale, volleyball game, etc. Anything that brings neighbors together in a fun and relaxed setting is a good choice!
Gatherings can be promoted through your neighborhood’s social media network, blog or listserv, or you can go the old-fashioned route and hand out flyers door-to-door. Whatever you do, be sure to make your gathering inclusive and welcoming to all.
BE A GOOD NEIGHBOR
As with anything in life, you will get out what you put in. It can take time to build lasting and meaningful friendships with your neighbors, but the effort you make is likely to pay off tenfold.
The tried-and-true way to make friends, expand your circle, grow your support system and get engaged in your community? Be a good neighbor yourself.
What are the best ways you’ve found to meet and engage with your neighbors? Share your success stories or challenges in the comments below!
Turn on the television or scroll through Facebook, and chances are you’ll see at least one advertisement for a group or “guru” who promises to teach you how to “get rich quick” through real estate investing. The truth is, much of what they’re selling are high-risk tactics that aren’t a good fit for the average investor. However, there is a way to make steady, predictable, low-risk income through real estate investing. In this blog post, we’ll examine the tried-and-true tactics that can be used to increase your income, pay off debt … even fund your retirement!
WHY INVEST IN REAL ESTATE?
One of the basic principles of real estate investment lies in this fact: everyone needs a place to live. And according to the Bureau of Labor Statistics’ most recent Consumer Expenditures Survey, housing is typically an American’s largest expense.1
But there are other reasons why real estate is a great investment choice, and we’ve outlined the top five below:
Appreciation is the increase in your property’s value over time. History has proven that over an extended period of time, the value of real estate continues to rise. That doesn’t mean recessions won’t occur. The real estate market is cyclical, and market ups and downs are natural. In fact, the U.S. housing market took a sharp downturn in 2008, and many properties took several years to recover their value. However, in the vast majority of markets, the value of real estate does grow over the long term.
The S&P CoreLogic Case-Shiller National Home Price Index, which tracks U.S. residential real estate prices, released its latest results on August 29 with the headline “National Home Price Index Rises Again to All Time High.”2
While no investment is without risk, real estate has proven again and again to be a solid choice to invest your money over the long term.
2. Hedge Against Inflation
Inflation is the rate at which the general cost of goods and services rises. As inflation rises, prices go up. This means the money you have in your bank account is essentially worth less because your purchasing power has decreased.
Luckily, real estate prices also rise when inflation increases. That means any money you have invested in real estate will rise with (or often exceed) the rate of inflation. Therefore, real estate is a smart place to put your money to guard against inflation.
3. Cash Flow
One of the big benefits of investing in real estate over the stock market is its ability to provide a fairly steady and predictable monthly cash flow. That is, if you choose to rent out your investment property to a tenant, you can expect to receive a rent payment each month.
If you’ve invested wisely, the rent payment should cover the debt obligation you may have on the property (i.e. mortgage), as well as any repairs and maintenance that are needed. Ideally, the monthly rental income would be great enough to leave you a little extra cash each month, as well. You could use that extra money to pay off the mortgage faster, cover your own household expenses, or save for another investment property.
Even if you only take in enough rent to cover your expenses, a rental property purchase will pay for itself over time. As you pay down the mortgage every month with your rental income, your equity will continue to increase, until you own the property free and clear … leaving you with residual cash flow for years to come.
As the owner, you will also benefit from the property’s appreciation when it comes time to sell. This can be a great way to save for retirement or even fund a child’s or grandchild’s college education. Purchase a property when the child is young, and with a little discipline, it can be paid off by the time they are ready to go to college. You can sell it for a lump sum, or use the monthly income to pay their tuition and expenses.
One of the unique features that sets real estate apart from other asset classes is the ability to leverage your investment. Leverage is the use of borrowed capital to increase the potential return of an investment.
For example, if you purchase an investment property for $100,000, you might put 10% down ($10,000) and borrow the remaining $90,000 in the form of a mortgage.
Even though you’ve only invested $10,000 at this point, you have the ability to earn a profit on the entire $100,000 investment. So, if the property appreciates to $120,000 – a 20% increase over the purchase price – you still only have to pay the bank back the original $90,000 (plus interest) … and you get to keep the $20,000 profit.
That means you made $20,000 off of a $10,000 investment, essentially doubling your money, even though the market only went up by 20%! That’s the power of leverage.
5. Tax Advantages
One of the top reasons to invest in real estate is the tax benefit. There are numerous ways a real estate investment can save you money each year on taxes:
When you record your income from a rental property on your annual tax return, you get to deduct any expenses associated with the investment. This includes interest paid on the mortgage, maintenance, repairs and improvements, but it also includes something called depreciation.
Depreciation is the theoretical loss your property suffers each year due to aging. While it’s true that as a home ages it will structurally need repairs and systems will eventually need to be replaced, we’ve also learned in this post that the value of real estate appreciates over time. So getting to claim a “loss” on your investment that is actually gaining in value makes real estate an appealing investment choice.
Serial Home Selling
Even if you’re not interested in owning a rental property, other types of real estate investments offer tax advantages, as well. Generally, when you own an investment property you pay a capital gains tax on any profits you make when you sell the property.
However, when you sell your principal residence, you are exempt from paying taxes on capital gains (up to $250,000 for singles and $500,000 for couples). The Internal Revenue Service (IRS) only requires that you live in the house for two of the previous five years. That means you can purchase an investment property, live in it while you remodel it, and then sell it for a tax-free profit two years later. This can be a great way to get started in real estate investing.
Section 1031 Exchanges
In addition to profiting off of your personal residence tax free, it is possible to sell an investment property tax free if you do it through a 1031 Exchange. If structured properly, the IRS Tax Code enables an investor to sell a property and reinvest the proceeds in a new property while deferring all capital gains taxes.
Tax-Deferred Retirement Account
It’s a common misconception that you can only purchase financial instruments (i.e. stocks, bonds, mutual funds, etc.) through an Individual Retirement Account (IRA) or 401(k). In actuality, the IRS allows individuals to invest retirement funds in real estate and other alternative types of investments, as well. By purchasing your investment property through an IRA, you can take advantage of all of the tax savings these accounts offer.
Be sure to consult a tax professional regarding all tax matters related to your real estate investments. If structured correctly, the profits you earn on your real estate investments can be largely shielded from tax liability. Just another reason to choose real estate as your preferred investment vehicle.
TYPES OF REAL ESTATE INVESTMENTS
While there are numerous ways to invest in real estate, we’re going to focus on three primary ways average investors earn money through real estate. We touched on several of these already in the previous section.
1. Remodel and Resell
HGTV has countless “reality” shows featuring property flippers who make this investment strategy look easy. Commonly referred to as a “Fix and Flip,” investors purchase a property with the intention of remodeling it in a short period of time, with the hope of selling it quickly for a profit.
This is a higher-risk tactic, and one for which many of the real estate “gurus” we talked about earlier claim to have the magic formula. They promise huge profits in a short amount of time. But investors need to understand the risks involved, and be prepared financially to cover additional expenses that may arise.
Luckily, an experienced real estate agent can help you identify properties that may be good candidates for this type of investment strategy… and help you avoid some of the pitfalls that could derail your plans.
2. Traditional Rental
One of the more conservative choices for investing in real estate is to purchase a rental property. The appeal of a rental property is that you can generate cash flow to cover the expenses, while taking advantage of the property’s long-term appreciation in value, and the tax benefits of investing in real estate. It’s a win-win, and a great way for first-time investors to get started.
And according to the U.S. Bureau of Labor Statistics, rents for primary residences have increased 21.9 percent between 2007 and 2015 as demand for rental units continues to grow.1
3. Short-term Rental
With the huge movement toward a “sharing economy,” platforms that facilitate short-term rentals, like Airbnb and HomeAway, are booming. Their popularity has spurred a growing trend toward dual-purpose vacation homes, which owners use themselves part of the year, and rent out the remainder of the time. There are also a growing number of investors purchasing single-family homes for the sole purpose of leasing them on these sites.
Short-term rentals offer several benefits over traditional rentals, which many investors find attractive, including flexibility and higher profit margins. However, the most profitable properties are strategically located near popular tourist destinations. You’ll need an experienced real estate professional to help you identify the right property if you want to be successful in this highly-competitive market.
DOES REAL ESTATE INVESTING SOUND TOO GOOD TO BE TRUE?
We’ve all heard stories, or maybe even know someone, who struck it rich with a well-timed real estate purchase. However, just like any investment strategy, a high potential for earnings often goes hand-in-hand with an increase in risk. Still, there’s substantial evidence that a well-executed real estate investment can be one of the best choices for your money.
Purchasing a home to remodel and resell can be highly profitable, as long as you have a trusted team in place to complete the remodel quickly and within budget … and the financial means to carry the property for a few extra months if delays occur.
Or, if you buy a house for appreciation and cash flow, you can ride through the market ups and downs without stress because you know your property value is bound to increase over time, and your expenses are covered by your rental income.
In either scenario, make sure you’re working with a real estate agent who has knowledge of the investment market and can guide you through the process. While no investment is without risk, a conservative and well-planned investment in real estate can supplement your income and set you up for future financial security.
If you are considering an investment in real estate, please contact us to set up a free consultation. We have experience working with all types of investors and can help you determine the best strategy to meet your investment goals.
Our areas of specialization include Sarasota real estate, Osprey real estate, Nokomis real estate and Venice real estate.
Give Beverly and John a call at 941-321-3916.
Bureau of Labor Statistics Consumer Expenditure Survey Annual Report – https://www.bls.gov/opub/reports/consumer-expenditures/2015/home.htm
S&P Dow Jones Indices Press Release –
Durden, T. (2016 November 29). US Home Prices Rise Above July 2006 Levels, Hit New Record High [blog post] ZeroHedge –
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The living room, dining room and bedroom photos have been virtually staged to give you ideas.
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Call or Text Beverly and John for more information on this property or for help with other properties. 941-321-3916
The new statistics have been released for April 2017. Watch our short videos.
Since over 96% of Buyers begin their home search online, it is more critical than ever to align your self with professionals who
are committed to a strategic, individually tailored online campaign to get your home sold.
Get more information on what these numbers mean to you. Just get in touch with us – we are here to help
The current trends are all about utilizing rich color, maximizing texture and creating comfortable interiors you can’t wait to relax in. Use these trends to get inspired to makeover your home’s interiors and create spaces you love that also appeal to your personal style. Remember, if you plan to sell in the next few years, you may want to avoid doing anything dramatic and instead incorporate small changes that would appeal to buyers.
Why are these trends gaining popularity?
The underlying theme of these trends is creating a home environment you love; one that appeals to your emotions and feels like a retreat from the stresses of the world. Although the home is a place where you can relax and spend time with loved ones, work expectations are beginning to blur the line between work and home. Even if people don’t work from home specifically, many are stretching their work hours into their evenings and weekends to complete work projects.
It’s no wonder the Nordic concept of hygge (most often pronounced “hoo-gah”) has become a hot trend. A centuries-old concept, incorporating hygge in the home means creating simple and comfortable spaces that make you feel cozy and safe and appeal to your senses.1 The emphasis is on simplicity and fostering positive experiences, whether you’re spending time with family, reading a good book or catching up on work emails.
WARM AND RICH COLORS.
Whether you want to play with a bold color or stick with neutrals, one thing is clear—paint is the foundation of a great design. Painting your interiors has a return on investment of about 75 percent and is a relatively inexpensive project to complete, costing between $25 to $100 for paint alone.2 If you’re thinking of refreshing your home’s interiors with a coat of paint, popular colors include warm taupe, fresh green and dark tones. These colors are popular choices because they evoke feeling of warmth and coziness when you walk into a room.
Wondering how to pair these colors? Taupe is the perfect alternative to traditional neutrals, such as gray and white, and goes well with cool blues, earthy greens and deep shades of wine. Green goes well with other earthy shades, such as copper and moss, as well as deep plum and bright pink. If you’re hesitant to paint your walls green, incorporate it into your home by way of accent pillows, rugs, lamps, vases and other accessories or add a few house plants.
If you’re interested in adding more drama to a room, include bold, dark colors. Dark shades add color and sophistication to any space. Plum and dark gray pair well with pale blues, warm whites and light gray.
Try one of these Colors of the Year:
Poised Taupe – Sherwin Williams
Greenery – Pantone
Shadow – Benjamin Moore
Lux materials create a space in which you can’t wait to kick off your shoes and relax at the end of the day. The Danes use a mixture of materials and pattern as a way of adding character and interest; however the overall look still needs to adhere to a color palette to prevent it from looking distracting.
Natural materials and textures allow you to maximize the comfort of the bedroom, living room or family room. Wood accents give rooms an earthy feel. Incorporate rustic wood sculptures, trays and furniture into your space. Choose furniture made with sustainably harvested wood certified by the Forest Stewardship Council (FSC) or use reclaimed wood for an environmentally friendly alternative.
If natural elements aren’t your style, but you want to add more visual interest to your room, try mixing patterns. Although it may have been avoided in the past, mixing stripes, florals and geometric prints actually help ground a space as long as the patterns feature complimentary colors or different shades of one color. If you’re worried about going overboard and making your room look “busy,” focus your mix in one area of the room. For example, add throw pillows in a variety of patterns to your sofa.
According to a recent study from the American Psychological Association, people are more stressed than ever, with 24 percent of adults reporting they’re experiencing “extreme stress.”3
Top sources of stress include work and money. By incorporating small changes, like making your house more energy efficient, you can start to lower your bills and get back to relaxing and enjoying life like the Danish do (who consistently top the polls as the happiest people).
Save money on your energy bills by sealing the “envelope” of your home, which includes the windows and doors, walls, floor and roof. The better insulated your home is, the less heat will escape and the lower your energy bill (and stress level) will be.
The most heat loss occurs through the walls of the home: up to 35 percent of heat loss, to be exact.4 Ceramic insulating paint is a space-inspired coating of paint mixed with ceramic compounds and applied to interior or exterior surfaces. It seals your walls and prevents heat from escaping, which means reduced energy bills all year long.
THE FUNCTIONAL HOME OFFICE.
Twenty-four percent of employed people do some or all of their work at home.5 Since more people are working remotely than ever, home offices are becoming more popular. Even if you don’t plan on working from home, a home office gives you a place to pay bills, work on personal projects, plan your family’s schedule and more. Home offices tend to be multifunctional, serving as a guest room when family and friends visit, and have the potential to meet other needs that arise.
The key idea behind hygge is to enjoy the environment around you and for each room to be a sanctuary to sink into at any given moment. Your home office is no exception! Maximize your productivity, efficiency and focus by painting the walls shades of green or blue.6 If space is an issue, create a nook by installing docking and tech cabinets that are big enough to store a printer and other small office equipment and files without taking over the room.
If you don’t have room in your home for an office, look no further than your backyard. Shedquarters, small structures or sheds built in the backyard for use as an office or home-based business, are an attractive option for homeowners who don’t have a room to dedicate to an office and don’t wish to add on their homes. while the jury is out on how much value these structure add to a home, they can convert easily into a storage shed if you plan to sell in the future.
SPLURGING ON KITCHEN RENOVATIONS.
The kitchen is often the busiest, most hectic room in the house and one of the top renovation projects with a high return on investment.7 We do more than cook meals there; it’s where homework is done, bills are paid, weeks are planned and more.
Kitchen remodels consistently show a respectable return on investment. According to the 2017 Cost vs Value Report from Remodeling magazine, a minor kitchen remodel touts an 80.2 percent return on investment.8 You don’t need to overhaul your entire kitchen to make it more hygge. Smaller additions can transform it into a relaxing and functional space you enjoy spending time with friends and family in.
What does a “minor kitchen renovation” entail? In addition to replacing the fronts of your cabinets and drawers, it also includes replacing out-of-date appliances and fixtures. You may also consider replacing counter-tops. Quartz and quartzite are becoming more common as are other green laminate options, including ones that mimic stone, wood and concrete. Laminates install in less time, often over the existing counter-top, make it an ideal choice for busy homeowners as well. Other hot kitchen trends include incorporating sustainable materials like bamboo into your counter-tops and floors and water filtration systems.
Want to improve the look and feel of your home’s interior? Are you thinking of upgrading to a home that better fits your changing needs?
Call us—we’d love to help you achieve all of your home-related dreams.
Imagine this: you own a home, and you’re getting ready to make a move. To guide you through that complicated process, you decide to work with a real estate agent, and you expect that agent to… what?
According to a survey of recent home sellers by the National Association of Realtors, the number one expectation people had of their agent was for them to “help the seller market their home to potential buyers.”
“Marketing the home” is the process by which agents advertise that the property is for sale, and the point is to bring enough attention to your home to ensure that you get the best deal possible.
Unfortunately, many agents simply follow the same tired, insufficient formula: they will place a “For Sale” sign in your yard, they’ll update your local Multiple Listing Service (MLS) with your property’s information, then they’ll sit back and wait. We often call that the “old” 3 Ps. Place sign, Put in MLS and Pray
In today’s Digital Age, that method won’t cut it. Whereas before we could assume that the majority of home-buyers would be guided to their new homes by buyer’s agents, more and more are finding the homes they end up purchasing online, by themselves — 51% of them as of last year, in fact. This means that we now need to find ways to get in front of the consumer directly.
This is why I’ve committed to earning my Real Estate Digital Marketer Certification®. This intensive course taught me how to promote real estate using the latest digital strategies and tactics so that I can help you get as much money as possible for the sale of your home, in the time-frame that works best for you.
By becoming a REDM®, I’ve learned an entirely new way of marketing real estate. Though of course that will still include putting a sign in your yard and putting your home in their MLS, I can now promise you so much more.
So I like to say we have added to the “old” 3 Ps. Our Digital Marketing Plans include Pricing, Preparation, Professional Photography and a Pre-launch Campaign.
For example, one of the latest and greatest marketing avenues is Facebook. Over a billion people log into Facebook daily and spend an average of 20 minutes on the site once there. That’s a huge audience! The REDM® Certification course gave me extensive practice finding the potential buyers in our area in that crowd and creating advertisements designed specifically to spark their interest in your home.
Another incredibly effective marketing method is online video. Think about your own experience looking at homes online. Despite the number and quality of available photos of the property, sometimes the home still had a different impression in person… for better or for worse. Filming a video of the home and hosting it online is a meaningful way to engage home-buyers who are genuinely interested in your property.
But beyond how to use these specific tools — and perhaps even more importantly — the REDM® course taught me the core principles of marketing and how to apply them across various online marketing and advertising platforms. That means that I’m ready for whatever curveballs our market throws at us and can promote your home online, print, or otherwise.
Curious to see what all we can do to sell your home? Just ask to see our Property Marketing Plan! We’d love to show you how everything I’ve learned can benefit you.
Sarasota Real Estate Market Trends
The new statistics have been released for March 2017.
The number of homes sold year over year went up over 6%
1230 homes sold in March 2017 versus 1158 homes sold in March 2016
The Sold volume increased over 8%
The March volume for 2017 was $419,006,501 which is up 8.27% over March 2016
The Average Sales Price increased
The March 2017 average sales price was $340,656 which is up almost 2% from March 2016
The Average Days on Market increased as well
March 2017 average days on market was 78 compared to 60 in March 2016
The Number of Active Listings increased from last year
The number of active listings in March 2017 was 5,111 which is 17% above March 2016
Since over 96% of Buyers begin their home search online, it is more critical than ever to align your self with professionals who
are committed to a strategic, individually tailored online campaign to get your home sold.
Get more information on what these numbers mean to you. Just get in touch with us – we are here to help
Did you know that you can pay your Sarasota county property taxes on a quarterly basis instead of having to pay all at one time?
In order to participate for this year, you must apply by April 30th. Click here to find the Installment Application form. In June, the Sarasota county tax collector will mail your first installment bill to you, with instructions. The great thing is that once you apply you do not need to reapply each year.
Once you have elected to participate by paying the first payment however, you are required to continue participation for the tax year.
The real estate tax bill is a combined notice of ad valorem taxes and non-ad valorem assessments.
Ad valorem taxes are paid in arrears (at the end of the year) and are based on the calendar year from January 1 – December 31. I like to describe ad valorem as “based on value”. So if your house is bigger, or your land is bigger, or your view is better, you pay more “based on value”.
Non-ad valorem assessments are not based on value but a unit of measure determined by the levying authority. The assessment periods vary and may not be based on the calendar year. Examples of non-ad valorem assessments are stormwater utility, fire and rescue, and solid waste collections. So all homes on the street would pay the same, regardless of size or amenities.
If you do not pay quarterly, taxes are due and payable on November 1st with discounts for early payment.
In cases where the property owner pays through an escrow account, the mortgage company requests and is sent the tax bill and the owner receives a copy of the notice. The mortgage company is then responsible to pay the taxes on time.
The following discounts apply for early payment of your Sarasota county real estate taxes:
The property appraiser assesses all property at just value each year on January 1. When you acquire new real property, the assessed value of the property “resets” to equal the just (market) value.
If the new property owner has applied for and has been approved to receive the homestead exemption, the Save Our Homes cap is placed on the assessed value of the property the year after the property received the homestead exemption. This means that if the just value of the property increases, your next year assessed value cannot increase more than 3% or the Consumer Price Index (CPI), whichever is less. For 2017, the CPI is 2.1%.
If the property does not benefit from a homestead exemption, the assessed value increase is limited to 10% each year.
So be sure to take advantage of the opportunity to pay your taxes quarterly and also take advantage of the homestead exemption with the Save Our Homes Cap.
Let us know how we can help with any of your real estate needs.