Late Spring Market Update-Mex​ico Beach to Cape San Blas-98

Things are going well at your favorite Coastal area. There’s a sense of optimism everywhere and there were some great crowds down enjoying the beach for Spring Break. I heard over and over again on the weekends from different business owners that it felt like the 4th of July did 10 years ago. I’ve seen rental companies cut their summer advertising, not because they are doing poorly, but because everything is almost completely booked. There are more and more people wanting to come to the area this year. We have had some new businesses open this year and others are under construction right now. The overwhelming majority of business owners I talk to tell me that they are up this year and that this may be their best year ever.

Real estate sales are definitely up as well. There have been 116 sales so far this year which puts us on pace to have the most closings of any year since 2005. Mexico Beach/St. Joe Beach is having the most activity with 51 closings while Cape San Blas/ Indian Pass has had 32 sales and Port St. Joe is at 23 for the year. There’s also an astounding 78 properties under contract!! The higher end market remains a little slow. I have the 2 highest residential sales ($400,000) for the Mexico Beach/St. Joe Beach area and also have the highest sale in the Port St. Joe area for the year at only $190,000. There has been a little more higher end activity for the Cape San Blas market with 6 sales of $400,000 or higher with the highest sale year to date at $525,000.

98 Real Estate Group started back the Ling Ding fishing tournament that was an old time favorite but hasn’t been held since the 80’s. We hoped to get 30 boats entered our first year and we currently have 61 boats. We have had wonderful response and participation from the community. Our finale will be held at the Mexico Beach Marina this Saturday afternoon. There will be live music and we will be smoking a pig and providing free BBQ and refreshments. Feel free to stop by and enjoy the company and see some big cobia weighed in. This link will show you all the pictures:

My parents are both retired teachers. They sold their home in Bainbridge Georgia last month and are now full time residents of Mexico Beach. They sold a smaller house here late last year and want to consolidate and have one large home at the beach. They are planning on buying a nice lot and build the house my mother has always wanted on it. They are looking for a lot in a nice area within easy walking distance of the beach that’s at least 70’ wide and surrounded by other single family homes. I took my dad around and showed him 4 lots that stood out as good deals last month. All 4 have sold since then or are under contract.

I’m telling their story to help to show that it is hard to be passively looking for a place at the beach and expect the properties you’ve looked at to still be on the market when you decide to purchase. He really liked 2 of the lots and now we can’t find anything at those prices that compare. It could realistically take us a few months now and they may still have to pay more. There are a few exceptions and some deals stay on a few weeks longer than expected, but most deals are moving pretty quickly. If you seriously want a place for Summer, you need to be a committed buyer that can act quickly. If I can help you in any way, please let me know and I need to know what you’re looking for. The best way for me to be able to help you is to spend some time looking around one day at properties and by listening to what you like and don’t like.

I updated the Top 25 today at http://www.mexicobeachsales.com/ and below are the deals that stand out for Port St. Joe and Cape San Blas.
Port St. Joe Residences: http://www.rafsg.net/RAFSGReports/ListitLib/show_report.aspx?ID=1206990970

Cape San Blas Residences: http://www.rafsg.net/RAFSGReports/ListitLib/show_report.aspx?ID=1206990971

Cape San Blas and Port St. Joe Lots: http://www.rafsg.net/RAFSGReports/ListitLib/show_report.aspx?ID=1206992403

If you're looking to sell, 98 Real Estate Group is leading the way getting properties sold. We have been extremely successful this year and are advertising and marketing extensively. We currently have 13 properties under contract and are in negotiations on numerous other properties. There are less people here right now, but many of them are negotiating on property that they saw over Spring Break. I expect May to remain steady and then have a very busy Summer. I've put a gulf front duplex, gulf view lot, gulf front condo, and and interior townhouse under contract in the last week and have closed on 8 other properties since March 1st.

I’ve partnered with a few friends and have purchased a home on the beach in Beacon Hill that sits across 2 beach front lots. We will be moving the house about 3 miles to a lot on 35th St. in Mexico Beach. There are not many gulf front lots left. There’s usually only one or two that sell each year as most owners want to hold on to them or either sell them at 2005 prices. The least expensive gulf front lot from St. Joe Beach to Mexico Beach is currently $449,000. These two lots will be available at $299,000 each. With building prices down, you could be in a very nice brand new beach front home for under $600,000. There are some good deals on existing gulf front homes as well, here is a link to see all of the gulf front single family homes on the market now.

Superior Bank was taken over by the FDIC on April 15th. Houston based Community Bancorp was set up to take them over and they never missed a beat and were open for business Monday morning. They will now operate as Superior N.A. Every single employee I talked to seems optimistic that this has happened and that they now have a much healthier bank. One of them told me they went from the worst capitalized bank in Florida to the best overnight. Rates are still looking good and a rate sheet I saw this week had 30 year conventional mortgages at 4.875% and 15 years at 4.375%. Vacant land loans aren’t as attractive, but more banks are starting to lend on land and there are many more options than there were 2 years ago.

I hope that you get to come and enjoy the beach soon.

Take care,
Zach Childs
Cell: 850-819-0833
Broker/Owner 98 Real Estate Group
http://www.98realestategroup.com/
http://www.mexicobeachsales.com/

Spring Market Update- 98 Real Estate Group

There have been some big changes since the January newsletter. To start with, the weather has gone from freezing to absolutely beautiful. There have been some nice crowds here enjoying the beach. I’ve heard multiple business owners make the comment that on a few of the weekends it’s looked like the 4th of July did 10 years ago. That’s a very good sign for “the season” and every rental company I’ve talked to has told me it’s looking like a great year for them. I hope you have been able to come and enjoy some of the awesome weather and beautiful beaches. The fish have shown up as well and lots of Spanish mackerel has been caught along with some huge cobia.

98 Real Estate Group is up and running and is by far more than a small startup company. I’d like to thank everyone that has helped us get off to such a great start. After being open barely a month, we have 82 properties (http://www.rafsg.net/RAFSGReports/ListitLib/show_report.aspx?ID=1206935486) either listed or under contract totaling over $17,000,000 in sales and 6 of the hardest working agents in the area with offices in Mexico Beach and Cape San Blas. We aren’t just listing property; last week we had 5 closings. The locations varied from a canal front home in Mexico Beach, a first tier lot on Indian Pass, a home in Port St. Joe on Long Avenue, and two lots in Park Point on Cape San Blas. Just yesterday, we closed a WindMark Beach waterfront lot yesterday so it’s clear that our momentum is strong. We have another 10 properties under contract scheduled to close by April 15th! I will be surprised if we don’t finish as the top company for the area in 2011, currently we’re #2. I’ve continued to be very fortunate and able to work with a number of great buyers and sellers. I love my job due to the people I work with are wonderful people and fun to get to know. I had the 2 highest sales from Mexico Beach to WindMark in 2010 and currently have the 2 highest sales in 2011; both of which were listed with 98 Real Estate Group. Come by and see us at one of our office locations, below is our Mexico Beach Office and a picture from last week of the beach.

It would be easier to tell you where we aren’t advertising than where we are. We launched a great website www.98RealEstateGroup.com that features the easiest search features available with the ability to see the different beach camera views in Mexico Beach. You can learn even more about us and find out about some of the top deals first by checking us out on facebook. We are also the proud sponsors of the 2011 Ling Ding. This is a fishing tournament that hasn’t been held in years that was a favorite time for many people. The fishing is open every Friday, Saturday, and Sunday in April and should be a lot of fun. There are a number of people and groups that have helped to bring the tournament back. It should be a lot of fun, starting with a kickoff party at Mango Marley’s on April 2nd, another get together at Reagan’s Oyster Bar on the 9th, and a final celebration on the last day of the weigh-in on April 30th at Marquardt’s/Mexico Beach Marina with free BBQ, smoked fish, and refreshments. I’m on the tournament committee so feel free to contact me for details and you can see more at our website and The Ling Ding’s Facebook page.
How’s the market? It’s busy. Remember more property sold in 2010 than any year since 2005 and that with the market stalling for a few months during the huge scare related to the oil spill. 2011 has started off even busier that 2010. There have been 86 sales this year vs. 67 for the same time period last year- http://www.rafsg.net/RAFSGReports/ListitLib/show_report.aspx?ID=1206939322 One thing is certain, there are a lot of buyers looking for a great deal on houses/townhouses/condos. We’re really running low on “good” deals.

I had an investor come in this week wanting a list of all the single family houses/townhouses/condos etc that have been foreclosed on and are on the Market from Mexico Beach to WindMark Beach. It was a short list of 6 with nothing standing out as a steal. Then he wanted all the foreclosed residences on the market in Highland View, Port St. Joe, Oak Grove, and Jones Homestead. That list totaled only 4 listings. We next viewed the Cape San Blas/Indian Pass market which only resulted in 7 choices. Here’s a link to see them all: http://www.rafsg.net/RAFSGReports/ListitLib/show_report.aspx?ID=1206939294

I’m hearing more and more and starting to think myself that the majority of the best deals at least for single family homes may be in the past. The one thing that you can still find a good deal on pretty easily is an interior vacant lot. There are 55 vacant lots listed as foreclosures and many are selling for 10%-20% of what they were purchased for during the height of the market. There are also a number of good deals on non-foreclosures. It’s a very good time to look at vacant property and there are even some banks lending on lots again with only 25% down. Gulf front and gulf view foreclosures and short sales aren’t nearly as common though as the interior lots a few blocks from the beach. I can certainly find you a good deal on a house, but the average time it’s taking to find a buyer a deal they are happy with is getting to be over 3 months.

What are the best deals on the market? For the area from Mexico Beach to WindMark, check out MexicoBeachSales.com. I put 20 new listings on for the Top 25 and Top 15 Lots in the past 2 days. Here’s what’s standing out for Port St. Joe and Cape San Blas. PSJ Deals: http://www.rafsg.net/RAFSGReports/ListitLib/show_report.aspx?ID=1206939304 Cape and Indian Pass Deals: http://www.rafsg.net/RAFSGReports/ListitLib/show_report.aspx?ID=1206939306

Do I have any concerns? Yes, appraisals have become a major problem. There are new appraisal guidelines and the banks can’t choose the specific appraiser that they use anymore. The local banks seem to only use local appraisers and these guys are very knowledgeable in the area and know what they are doing. The big problem is occurring when people are using banks from outside of the area. These banks are calling an appraisal management company that then assigns them an appraiser. The appraiser is usually someone that no local Realtor has heard of and may be from Panama City or Tallahassee. It seems they do their appraisal from the internet and they don’t seem to understand coastal property in this area very well. Recently, I had one appraisal report where there was only a $10,000 adjustment for land value when they used a sold property almost a mile from the beach and the one being purchased was 1 house off the beach. To give you an idea of the coastal knowledge these out of town appraisers posses, one thought Mexico Beach was in Gulf County. If you do need an appraisal and can choose who to use, Matt Terry, owner of North Florida Appraisal Group is great to work with. His cell is 850-227-6478.

It’s looking like another great weekend and I hope I’ll have enough free time to go and enjoy the Air Show at Tyndall. I hope that you are able to come and enjoy this beautiful place. I also hope FSU can win their game tonight. Here’s a couple pictures I got at the last air show.

Have a great weekend,
Zach Childs
Broker/Owner- 98 Real Estate Group
Cell: 850-819-0833

Fortune 500- CNN Money Article about JOE- Windmark

This is an interested article about The St. Joe Company. One of their largest developments is Windmark Beach. There's a pretty cool slideshow about Windmark if you follow this link: http://finance.fortune.cnn.com/2011/02/07/berkowitz-throws-the-gauntlet-in-the-battle-over-st-joe/

Berkowitz throws the gauntlet in the battle over St. Joe
Posted by Scott Cendrowski, reporter
February 7, 2011 12:38 pm


Bruce Berkowitz is proposing to become chairman of the Florida developer. That could spell trouble for short seller David Einhorn.


A St. Joe real estate development
Last week, the investor Bruce Berkowitz of Fairholme Capital was onstage at Columbia University's annual Investment Management Conference in New York when he got a question about St. Joe Company (JOE), one of the most debated stocks among certain moneyed circles. Ever since noted short seller David Einhorn publicly bashed the small Florida real estate developer last fall, the press and financial blogosphere have gleefully pitted Berkowitz, St. Joe's largest shareholder, against Einhorn in a battle of super investors.

So it didn't take long before someone in the Columbia audience asked Berkowitz if Einhorn might be wrong. "I don't have a lot to disagree with David about," Berkowitz answered, saying he was a long-term shareholder and since joining the St. Joe board earlier this year, he's been doing everything he can to boost St. Joe's value. The moderator quipped, "Assuming you guys have any real power on the board."

If he didn't before, Berkowitz may be about to get a lot more. According to a CNBC.com report that was confirmed today by Berkowitz, the fund manager is proposing to overhaul St. Joe's board. It's the latest in a string of moves to reverse three years of losses at the sleepy Florida company.
Berkowitz would become chairman of St. Joe under his proposal. His partner Charles Fernandez would assume the vice chairman role. In addition, Fairholme recruited Howard Frank, COO of Carnival Corporation (CCL), and Florida Fish and Wildlife Conservation Commission Chairman Rodney Barreto to join the board. Berkowitz expects to discuss the proposal tomorrow at St. Joe's scheduled board meeting. A St. Joe spokesman did not immediately return a call Monday.

Berkowitz and Fernandez have been planning changes for weeks and said the St. Joe board had been notified before the news leaked Sunday. The report sent St. Joe shares soaring Monday, up as much as 11% to $30.

The proposed shakeup raises the question, what's in St. Joe's future? It's got 576,000 acres of land in Florida's panhandle, a large chunk of which is located within 15 miles of the coast, but it's bled money for the last three years after residential developments stalled during the housing bust. Its balance sheet is debt-free, but the company isn't generating cash or profits. Berkowitz has said it's "just sort of dead in the water."

Among the possibilities, Berkowitz says: "Outsourcing the entire operations of the company, merging with another company, being acquired by another company. Acquiring another company."

The "possibilities are vast. But before you can do any of this, the first thing you have to do is stop the bleeding," he says.

Berkowitz declined to answer specific questions about St. Joe's future projects, citing his role as a director. However, he's said in the past that outside developers could help rework St. Joe land. And he's still bullish on the stock. He bought St. Joe shares valuing its land between $3,000 and $4,000 an acre. He thinks some of its beachfront properties will fetch $1 million an acre.

Interestingly, Berkowitz and Fernandez won't accept compensation for their work on St. Joe's board, nor will they accept reimbursement for flying from Miami to St. Joe's west Florida headquarters, until the company is profitable.

Coming up short

As investors cheered the news, those selling St. Joe stock short took a hit. Einhorn, known for his deep research and patience after successfully betting against Allied Capital and Lehman Brothers, among others, in Greenlight Capital's 15-year history, is fighting some heavy hitters in St. Joe.

Berkowitz's $22 billion Fairholme Capital owns nearly 30% of the company, and six other institutional investors, including BlackRock (BLK) and T. Rowe Price (TROW), control nearly 40% of its shares. If the board rejects Berkowitz's proposal to become chairman tomorrow, it's a safe bet that the proposal would go to a shareholder vote. And with Berkowitz's investment track record and reputation, it's also likely that other large St. Joe shareholders would side with his proposal.

Another strike against Einhorn: When he gave his 139-slide presentation on St. Joe in October, arguing that its stock should trade between $7 to $10 instead of $25, Berkowitz was restricted by a standstill agreement he signed with the company. It prevented him from adding to his stake, or from voting Fairholme's full share position in certain situations, including proposals to sell the company.

Just to show how serious Berkowitz is about St. Joe, which is a relatively small position in Fairholme's $22 billion portfolio, take a look at the slideshow below. In October he sent a photographer to tour St. Joe's properties after Einhorn's speech featured several unsightly photos of St. Joe developments. Even though Berkowitz had toured the properties before, he wanted to see what St. Joe's residential properties looked like compared to Einhorn's photos. See for yourself. (And to be clear: all the slides and commentary were compiled by the photographer, not Berkowitz.) Einhorn did not respond to a request for comment.

The news might be heating up. St. Joe's board is meeting tomorrow, and with the news leaking out that Berkowitz wants to replace almost half them, emotions could fly. Another reason to keep up with one of the hottest stocks around.

Happy New Year-Mexico Beach to Cape San Blas Market Update & More

Happy New Year!
I hope everyone had a wonderful 2010 and is looking forward to a joyous and prosperous 2011. I’d like to thank everyone for another great year. I was able to help get over 30 pieces of property sold and invite you to click here to see what some of my customers had to say about their experiences. I work very hard to give the best service possible. I appreciate the opportunity to work together and have successful relationships with so many of you. I sold a wide range of different properties including the 2 highest sales and the lowest sale in the Mexico Beach/St. Joe Beach Area. I also sold more vacant lots than anyone for the Cape San Blas Area. I enjoy what I do and am especially excited about 2011. I’ve worked with a number of the top companies over the last 6 years and have big plans to open a new company next month. 98 Real Estate Group will be able to offer the highest level of customer service and professionalism. Our agents have been top producers from Mexico Beach to Cape San Blas for years and provide unmatched hands on experience and knowledge of the local market.

I’ve decided to send out an update by answering a few of the questions that I am most frequently asked. Hopefully, some of this information is interesting and helpful to you.

The #1 most asked question is, what are prices doing? It depends on what type of property. I’ve seen some reports out of Panama City saying that prices were up 1% last year. I don’t know if our overall market went up or not. It is clear though that single family homes are doing much better than anything else. Townhouses aren’t far behind holding their values. The prices that did fall last year were condos and residential lots which both sold for new lows in most areas. During the boom there were hundreds of vacant lots and condos that hit the market and were purchased at peak prices. The combination of these vacant lots and condos going into foreclosure combined with the very limited financing that is available for these, limits the number of buyers and causes prices to fall. There are going to be and are some awesome prices on both condos and vacant lots. 2011 might end of up being the year of the condo in Mexico Beach due to banks and struggling developers holding so many units that are finally liquidated.

The 2nd most asked question I get from people looking at property is, what are the taxes, insurance, and HOA fees? This obviously depends on the property, but taxes and insurance have come way down since 2005. A good “guestimate” on what to expect to pay on taxes is 1.2% per year of the purchase price/value. Insurance is getting very reasonable, especially for anything built after 2001, which means it’s built to current building codes. I’m listing a single family home in Windmark Beach on Monday that is paying less than $1,200/year. Remember when it comes to flood zones that X is by far the best and will have the least expensive insurance. HOA fees average $1100/quarter for 2BR condos and usually include insurance, management, trash, water, sewer, and cable. It’s much less for townhouses, but the owners pay individually for the above mentioned items.

Is anything selling? Yes, more property sold in 2010 than any other year since 2005. I’d mentioned in previous newsletters that despite the oil spill threat, 2010 still looked like it would have the most sales since 2005, and it did. 392 properties sold in Gulf County and Mexico Beach in 2010 which is 79 more properties than have sold in any of the last five years.
Mexico Beach/St. Joe Beach/Windmark- 168 Sales
Cape San Blas and Indian Pass- 112 Sales
Port St. Joe-64 Sales
North Gulf County- 48 Sales

How many sales were either short sales or foreclosures? 36% or 143 out of the 392 sales in 2010 were listed as either short sales or foreclosures.

How can I see the best deals on the market? Check the recently updated Top 25 on www.mexicobeachsales.com

Where do people want to buy? We still have a steady stream of buyers wanting second homes, future retirement homes, or investment properties. They key is that these people want to be near the beach. A good rule is that people are buying where the tourists/vacationers want to be. There is a direct correlation between the areas with the whitest beaches and prettiest water to the highest number of sales.
What are the most common properties people are looking to buy in the Mexico Beach/St. Joe Beach Area? There are three types of property that the majority of people contact me to help them find. Beachfront is always close to the top of the list. These properties are most desired and still bring a significant amount more than gulf view and interior properties. Believe it or not, I get more calls from people looking for a lot to put an RV on than anything else. I’m not alone in this and most colleagues say the same. (Mexico Beach does not allow RV’s.) The other popular property type that a lot of people are looking for is a really good deal on a condo or townhouse close to the beach that they can use and/or rent out. Next on the list are gulf view single family homes with rental potential. Close to that are interior single family homes where you can get a lot of bang for your buck. It seems like the least amount of people are looking for interior lots in subdivisions. The majority of buyers these days don’t like the HOA fees and usually more expensive building restrictions. You can find the biggest discount on these, and I’ve sold lots that once went for $250,000 for less than $20,000.

What’s selling on Cape San Blas? There were a total of 112 sales. For the first time that I can remember, there were more vacant lots sold (61) than residences (50). I’m not surprised at this as there were and are some huge discounts on vacant lots on The Cape. There were many lots offered as foreclose/short sales, and buyers couldn’t resist the deals. I led the way for this area on MLS, listing or selling 14 vacant lots. Very attractive listing prices often attracted multiple buyers and raised selling prices. 5 of my 14 sales sold for over asking price. 38 of the 50 residential sales were single family homes. The high sale for the year was a nice gulf front home in Jubilation that brought $950,000. The lone commercial sale was “The Trading Post” which brought $599,000. The North End of the Cape remained by far the most popular area with buyers purchasing 69 properties . The next most popular area was CR-30 with 16 sales. Indian Pass and Cape San Blas South only recorded 11 sales each. There are plenty of buyers waiting for deals on the North End, but it’s much less of a frenzy for the other areas.

What’s selling in Port St. Joe? The St. Joe or “town” market remains slower than the beach markets. Out of 64 sales, 21 were vacant lots, and only 2 were commercial sales. Not one residential lot sold for over $60,000, and most sold for $30,000 or less. 38 out of 41 residences that sold were single family homes. 35 of the 41 sold for $200,000 or less. The highest sale price of the year in PSJ was $350,000.

When should I place my property on the market? The highest number of sales take place during the spring and summer. There are lots of buyers who plan to look at property while they are here on vacation. It’s time to get your property ready and on the market. 98 Real Estate Group is going to be doing about 3 times the advertising I’ve done in years past. I want to get our name out there and help us off to a great start. If you want a lot of exposure for your listing, list it with 98 Real Estate Group. Whether you’re looking to sell now or just curious about your current value, I’m here to help.

Are there many foreclosures left? That answer varies depending on the area and property type you’re asking about. It seems that areas where values are down the most have the most potential for other owners to go into foreclosure. Many are making strategic defaults when they watch banks sell properties almost identical to theirs for as little as 10%-30% of what they owe. I monitor services that give me a heads up on foreclosures usually 3-6 months before they are actually foreclosed on. I’d like to think the foreclosures are behind us, but there will be a significant number in 2011. There are certainly areas that are more stable than others. There has still only been one single family gulf front home from Mexico Beach to Windmark Beach that has been foreclosed on in the last 4 years.

What’s going on with the fishing? The big change this year is that grouper season has been shut down for at least 6 months. 98 Real Estate Group is proud to announce that we are starting back a cobia tournament this year much like the once beloved "Ling Ding". Fishing will be open for the tournament every Friday, Saturday, and Sunday from April 1st to the 29th. An award’s party will follow on the 30th. It’s only $150 per boat to enter with an unlimited # of anglers allowed. Weekly winners will be paid along with $2,000 for the biggest fish winner. There’s also a bonus $500 Spanish mackerel division. Feel free to contact me for more information. Halfhitch Tackle and Marquardt’s Marina will both have registration forms and are our official weigh stations.

Did you ever get any oil? Thankfully, there was never any oil that hit our beaches. Are some of these crazy stories about BP claims true? Yes, I have heard of multiple waiters that have received over $100,000 and other small businesses that have received much more than that. Unfortunately, the only profession with a maximum claim amount is real estate sales, with a cap of $12,000. Not everyone is being paid and identical claims from workers from the same places are being denied while others are paid. One reason I am mentioning this is for those of you with rental properties. There's no cap on rental income losses and I've seen some big checks go out to owners that were effected and could document cancellations and/or reduced GRI. I hope the oil spill is behind us, and that those that are paid make good use of the money.

I'm thinking about renting my property this year, who should I use? That depends on your goals and what type of property you would like to rent. My friends at No Worries Vacation Rentals specialize in maximizing rental income for their owners. They produced some great results last year. For example, one home I'm helping a nice couple purchase this week is listed at $425,000, and bringing in over $60,000/year. No Worries handles a limited number of properties and markets them heavily. I'd especially consider them if you are beach front or have a pool.

2011 will offer buyer’s incredible opportunities with some selling prices at over 10 year lows. There are plenty of buyers out there for those sellers willing sell at market prices. It's awful cold right now, but the warm days of relaxing on the beach will be here before you know it. The Gumbo Festival is just around the corner and my team is the defending champion of both the gumbo and Brunswick stew divisions. I hope to see you there and please remember that I am hear to help you. Please feel welcome to drop by my office located in The Villas next to Marquardt's Marina and just past the pier anytime.

Best Wishes,

Zach Childs
Broker
850-819-0833

Fall Market Update

The weather lately has been absolutely beautiful. The air feels great outside, and it makes sense again why so many owners block off their homes from the rental market and come and enjoy them for themselves in October. We still haven’t had any oil, and it looks like the Gulf Coast is going to be just fine. Come on down and enjoy it for yourself.

There hasn’t been a huge flood of buyers back in the market now that the oil threat is moving on, but there has been a steady flow. I currently have 7 properties under contract, which is the most I’ve had at any one time since before the oil threat began. There are a total of 70 properties under contract, which is another solid number. There don't seem to be any serious concerns about oil that are still keeping buyers from acting.

Everything points to 2010 still having the most number of properties sell since 2005. The majority of prices haven’t started going back up, but the discounts have remained enough to get buyers to purchase. It's also the first time in years that buying is cheaper than renting in some situations. Many sales have resulted when banks and other sellers have put prices out there so low that people just can’t pass them up. I have 2 listings under contract now that received multiple offers before going under contract. I have also had 2 buyers in the last 10 days that made offers on properties that received multiple offers and our offers were not the highest and best. My point here is to illustrate that the best deals are getting significant interest.

More good news is that we are having a bonus red snapper season this fall. The season will include Fridays, Saturdays and Sundays beginning Oct. 1 and extending for eight consecutive weekends through Sunday, Nov. 21. That gives fishermen an extra 24 days to enjoy Gulf red snapper fishing at a time when the weather is usually very nice and on weekends when most people are able to take off from work. The first two weekends of this season brought down a nice extra crowd of fisherman and visitors. It seems everybody is catching a limit of good red snapper except me. I’ve been busy the past few weekends working with interested buyers looking around for a deal of their own.

One of my favorite events in Mexico Beach is The Art and Wine Festival. This event is being held Saturday, October 16th, at The Driftwood Inn. The event will feature local seafood, fine wines, live auction, musical entertainment, and plenty of amazing artwork.

# of Sales 2009 vs 2010

Last year from 1/1/09-10/6/2009- 206 Sales
This year from 1/1/09-10/6/2010- 302 Sales

Remember, more property sold in 2009 than any year since 2005, so there is a significant amount of buying going on in 2010. Around ½ of the sales remain either short sales or foreclosures. The prices for homes have remained much steadier than the vacant lot market. There will be a sale every now and then for a home at a higher price and then one or two at a lower price, but it’s been pretty steady with the home prices lately. There are a good number of vacant lots selling, but it’s taking big discounts to attract the buyers, and we have seen some new lower selling prices for vacant property. The lower priced properties are continuing to get the attention this year while the gulf front and other higher end properties are selling very slowly. Out of over 300 sales this year, only 28 properties have sold for more than $300,000 and only 9 have sold for more than $500,000. A big reason for this is obviously that prices are down so much that many properties that were once selling for over $500K are now selling for well under $300K. There have been many great deals and it's unbelievable how cheap some of the vacant lots are selling for these days.

Financing rates remain incredible. Thanks to Amber Lowry (850-227-4492) at Vision Bank for helping me this week with a rate update. I’ll also add that for mortgages on primary homes, there are options available with 0% down and other programs that only require 10% down. For a second home, plan to put down at least 20%. Investment loans and vacant lot loans remain much more difficult to acquire and don't have near as attractive rates. 30yr loans are as low as 4.25% and there are 15yr products that are as low as 3.625%. With rates that low, if you purchased a $200,000 second home with 20% down and got a 30 yr mortgage at 4.375%, your principal and interest payment is $798/month. Not bad. There is an easy to use loan calculator on my website if you would like to figure up payments for any loan scenarios.

I have been updating the Top 25 on MEXICOBEACHSALES.COM at least twice a week and have added a section with the best deals on The Cape. Below are some of my favorite deals right now. There are good deals not featured on our MLS which can’t be included on the links below. You can find those at MEXICOBEACHSALES.COM. Still included on the site is all listed foreclosures/shortsales, recent sales, and other interesting information.

Best Deals on the Market:
Mexico Beach/St. Joe Beach/Windmark
Vacant lots: http://www.rafsg.net/RAFSGReports/ListitLib/show_report.aspx?ID=1206725496
Residences: http://www.rafsg.net/RAFSGReports/ListitLib/show_report.aspx?ID=1206725499

Cape San Blas/Indian Pass
Residences: http://www.rafsg.net/RAFSGReports/ListitLib/show_report.aspx?ID=1206725503
Vacant Lots: http://www.rafsg.net/RAFSGReports/ListitLib/show_report.aspx?ID=1206726656

Port St. Joe
http://www.rafsg.net/RAFSGReports/ListitLib/show_report.aspx?ID=1206726660

Please let me know if I can assist with any of your buying or selling needs.

Take care,

Zach Childs
Broker-Port St. Joe Realty
Cell: 850-819-0833

Life on the Gulf Coast is starting to return to normal. The fear we had for months that oil could ruin the area for years has greatly subsided. The fishing waters off this area have all been opened, and the MBARA Kingfish Tournament that my father directs will be taking place as usual this weekend. Last year brought just under 200 boats, and we hope to have another big crowd this year. I will be helping out and filming a TV show Friday night at the captain’s party at the El Governor. I hope to see you there and good luck fishing. My team is currently 9th in the first annual Panhandle Kingfish Slam, and we’re going to need a whole bunch of luck to make up that many spots in the final tournament. The great news is that we were able to have all of the planned fishing tournaments this year. Most of us thought the first tournament would be the last of the year and possibly for years to come, as the media scared us to death with their talk of all the devastation that the oil would bring. You can read all about the tournament, fishing waters, tournament standings, reef sites, and more from the Mexico Beach Artificial Reef Association which has raised over $1,000,000 at their redesigned website, http://www.mbara.org/.Below I'm with my Dad and a 30# king.

There have been a good number of people looking at property over the last month. I would say that I’ve shown as many people around this August as I did last year. We are starting to get back into the market where the best deals are going quickly, but it’s taking most buyers a few months to find something that they are happy with within their price range. I personally dropped a contract on a lot I was buying in early June when the seller offered to let me out because of the oil threat. Those were some very uncertain months. That lot actually closed a few weeks ago for more than I had it under contract for. I am confident things are going to be okay and did buy a different property a few weeks ago. The buying slowed down over the last few months with the fear of oil, but it didn’t stop.

Many buyers have the impression that prices are way down since the oil scare, but this is not the case. There have been some slight reductions, but nothing drastic happened to prices because of the oil. It did keep a number of properties from getting offers this summer, and this may lead to further reductions in prices this fall. I would say the number of closings over the last 4 months is down 50-70% from where it would have been without the oil threat. In my last newsletter I tried to stress what a busy summer it looked like it was going to be with so many buyers looking. Since so many buyers were looking to buy, even with most dropping out for a few months, there were more closings this summer than last summer.

# of closings from May 1st to August 24th (Gulf County and Mexico Beach)
2009: 94 closings http://www.rafsg.net/RAFSGReports/ListitLib/show_report.aspx?ID=1206664012
2010: 118 closings http://www.rafsg.net/RAFSGReports/ListitLib/show_report.aspx?ID=1206664015

The Scallop Festival on Aug. 6th–8th was great fun and brought a nice crowd. Since that event, Gulf County received $250,000 from BP that has to be spent directly on marketing and events with hopes of bringing people to the county before the end of the summer. Mexico Beach received additional funding, and we could have some great concerts and events coming up shortly. http://www.starfl.com/news/tourism-21429-county-money.html I don’t often mention politics, but many of you have asked about some of the things going on the last few months. Two Gulf County Commissioners that had been serving close to 20 years each were defeated Tuesday night by 2 newcomers promising to bring positive change to the area: http://www.starfl.com/news/county-21434-peters-traylor.html

School has started back, and our big crowds won’t be seen again this year with the exception of a few big weekends and happenings. There should be some great, exciting events with all of the BP money that must be spent to draw tourists in the next month or two. Heading into September I guess summer has been as good as it could be with the oil threat. Thank God nothing serious has come of the oil here, and I hope that everything will be completely normal by next spring. Meanwhile, it’s just about gridiron time. Good luck to everyone’s team, especially Florida State.

We did have one of our local banks get taken over on July 30th by the FDIC. I feel very sorry for the stockholders who lost money on this investment and especially sorry for anyone who lost their job. Coastal/Bayside Bank has been taken over by Centennial Bank out of Arkansas. They are open for business, and you can learn more at this website http://www.coastalcommunitybank.com/. This bank had a lot of hard working, good people, but they were very tied to the local real estate market, and we all know how much real estate values have declined. It has been rumored for 2 years that this takeover would happen. It’s a relief to many that it has happened, and everyone involved can move forward with the stronger bank that took them over.

There are 70 properties that are currently under contract. This number is higher than it would be if some of these short sales weren’t taking months to work out, but it does mean there are 70 buyers trying to close on a piece of property right now. 37 out of the 70 properties are listed as either being short sales or foreclosures. http://www.rafsg.net/RAFSGReports/ListitLib/show_report.aspx?ID=1206664022 . I've had a very busy day since I wrote that paragraph on Wednesday. Today I've put 3 more of my listings under contract to bring the total number of under contract properties up to 73.

Proposed property tax notices started being mailed out this week. Most people’s assessments and tax bills are down from last year. I have mostly heard from people that they are pretty pleased with their reductions. Still, many are tired of paying these taxes. I’m getting calls from a few sellers that are ready to just sell and move on. The market may see a few good deals hit the market from sellers like these. This is a much more common thought on vacant lots vs. properties people are actually using. Below are two aerials recently taken over The Cape & Windmark Beach Town Center.

Be sure to check out the new listings at mexicobeachsales.com. I’m also listing 8 foreclosures for RBC in the coming days at some great prices. There have been some exceptional deals from the lowest priced listings on up. It’s also been almost 5 months since the last sale of a Gulf front single family home in Mexico Beach or St. Joe Beach. All of these gulf fronts are priced to sell. http://www.rafsg.net/RAFSGReports/ListitLib/show_report.aspx?ID=1206665887 Below are other properties that are great opportunities. I have been updating the top 25 on Mexicobeachsales.com at least 3 times a week. Please also remember you can find all foreclosures and short sales at mexicobeachsales.com as well as mexicobeachforeclosures.com and capesanblasforeclosures.com. If you don’t see what you are looking for, please tell me what you want so that I can be looking for you.


Best Deals on the Market:

Mexico Beach

Residences: http://www.rafsg.net/RAFSGReports/ListitLib/show_report.aspx?ID=1206665927


Vacant Lots: http://www.rafsg.net/RAFSGReports/ListitLib/show_report.aspx?ID=1206665928


Cape San Blas:

Residences: http://www.rafsg.net/RAFSGReports/ListitLib/show_report.aspx?ID=1206665930


Vacant Lots: http://www.rafsg.net/RAFSGReports/ListitLib/show_report.aspx?ID=1206665964


Port St. Joe:

http://www.rafsg.net/RAFSGReports/ListitLib/show_report.aspx?ID=1206664047


Take care and tight lines,


Zach ChildsBroker- Port St. Joe Realty


Cell: 850-819-0833


http://www.mexicobeachsales.com/

Market and Oil Update- Our Coast is Still Clear

We have constantly talked and worried about the threat of oil for the last 3 months. We have claims offices and clean up workers everywhere, but thankfully, no oil. I think the news has scared us all and we’ve watched and waited but still have not had any confirmed oil arrive at Mexico Beach or any of the Gulf County beaches. Despite this, we battle the perception that there is oil on our beaches. The good news is that it looks like we are going to salvage a pretty good summer. The crowds are down a little, but it hasn’t been disastrous. I know one of the larger rental companies is on track to have their best year yet. These visitors aren’t buying real estate right now, but at least our restaurants, motels, and stores that depend so heavily on the summer season have been doing okay. We’ve even gotten a fair share of new vacationers who came from places where there was oil, and many are planning to come back. Many others vacationers and second home owners keep coming each chance they get just in case there is oil in the future. If you have plans to come to the beach right now, there doesn’t seem to be any reason to change those plans at least for the next several weeks. This is a local website that gives updates and shows a number of beach cameras showing the “Coast is Clear”.

Scallop season opened early this year and most people are finding all that they want. Fishing has been great, and it may be the best year I can remember. I love going fishing and have had some great trips. Below are a pictures from the last few weeks, including one of my dad and an 84# cubera snapper & my 43# wahoo.

How’s the market? It’s not dead, but it’s not the great summer it looked like we were going to have prior to the oil threat. Everything pointed to a ton of property selling this summer before the oil threat began. I think my situation gives a good representation of the current market. In May, I had roughly 15 buyers that were ready to purchase as soon as we could find the right property. 12 of the 15 adopted a “wait and see” attitude about what is going to happen with the oil. I’m getting some sales calls and new inquiries, but most people just want information and have no plans to purchase until the oil situation is resolved. There were so many buyers looking to purchase at the beginning of this summer that even with the majority on hold, there have been more closings this summer than last summer. Last year from May 1st to July 14th there were 56 closings. This year for the same time period, there have been 62 closings. That's amazing to me that the majority of buyers are on hold and we've still had more closings. There were going to be a lot of sales this summer if not for the oil. It’s most unfortunate for the sellers who looked like they would sell this summer without having to give further discounts. There’s still property selling, but the volume is not what it was in March and April when there were more and more buyers, and almost every good deal was getting multiple offers. Those of you who follow the market closely will be surprised at some of the deals that have not sold on my Top 25 at Mexicobeachsales.com.

The one positive effect from the oil threat on the market has been on long term rentals. BP has hired hundreds of workers to be here in case they need to clean up oil. These people need places to stay, and many have been paying very high rental rates. I have seen a number of places which normally rent for $1,200/month that are now renting for $3,000/month. (The renters do get all of their utilities included at this price.) The downside is that these workers must be allowed to cancel with just a 15 day cancellation notice because they need to move if the oil doesn’t get here or they are needed in other areas. I hope they all have to cancel their leases. On a very positive note, I’ve met a lot of these workers, and the majority are under the impression that it’s not going to get bad here.

What about these super low prices on Condos? There have been and are some new condos priced in the $50K range. They are located about ¼ mile from the beach in a development called Palmetto Plantation. It’s an unfortunate situation that’s a good example of a worst-case scenario in a condo/homeowner’s association. Most of the condo projects did certain things to save owners and developers money. One way they do this is to have one water meter with the city, and the water payment is included in HOA dues. This saves everybody. However, when an HOA lacks sufficient funds, this is a big problem. A number of owners weren’t paying their mortgages, much less their HOA dues. The HOA didn’t have the money then to pay the city for water. After months of failure to pay, the water was turned off by the city. Insurance was also combined and included in the HOA dues. I’m told this wasn’t being paid either. Since there was no water, the buildings were condemned because of fire codes. This project has had some new owners buy in and work out some items with the city. There are now two functioning buildings that do have water. It’s risky buying in these, but also maybe a great deal. These units are getting tons of interest by people who want a cheap place at the beach, but they can’t get loans on them. There is a good chance cash buyers will end up buying multiple units in this project and wait until they can get other paying owners to work together to resolve all of the issues.

Keep in mind that a bank will not give a mortgage on any project that is not in good standing. The Summerhouse project is right across from the beach in a good location with attractive, well-built units. There is a concern about this project failing next since the developer that owned about ½ the units filed bankruptcy. Prices have plummeted here, and there’s one 3 BR short sale now listed at $135,000. However, projects don’t always fail when it looks bad. Waterside Village was shaky a year ago and now looks very healthy with 24 units selling this year.
Rates on 30 and 15 year mortgages are near 50-year lows. Amber Lowry at Vision Bank told me this morning that she can do 30-year loans at 4.5% and 15-year loans at 4.125%. Even if you’re not looking to buy, it is a great time to consider refinancing. Her cell phone number is 850-227-4492 or you can email her at: alowry@visionbankfl.com. Superior Bank is another good local lender and you can reach Sam Tyus at 850-509-2442 or Sam.Tyus@superiorbank.com.

Short Sales vs. Foreclosures: This is confusing to many people. I try to address it each year in a newsletter since many of you have been added this year. A foreclosure is a property that a bank has foreclosed on and is now owned by the bank. A short sale is when the individual who owns a property tries to sell for less than they owe a bank. Short sales usually require quite a bit of negotiations with the seller's bank and are not all the time successful. Just because a short sale is listed at $399,000, that does not mean the seller’s bank is going to accept that amount. I know that can be very frustrating, and it can drive realtors and buyers crazy. You can often get a great deal on a short sale, but you may need to be patient as it often takes months to try and work out the details. A foreclosed property is different. Once it’s been foreclosed on and the bank owns it, it's a usually a much simpler process to purchase these properties. There are presently 76 foreclosed properties on the market. There are 19 foreclosed residences and 57 foreclosed vacant lots on the market. There are an additional 88 properties listed as short sales, 51 are residences and 37 are vacant lots. You can find these updated daily on the foreclosure link at MexicoBeachsales.com.

Best Deals on the Market
Mexico Beach/St. Joe Beach/ Windmark
Residences
Vacant lots
Cape San Blas/Indian Pass
Residences
Vacant lots
Port St. Joe
Residences

It was great to hear the reports last night that the oil has been stopped for the first time. Let's all hope the fix works and we can begin moving forward.

Take care,

Zach Childs
Broker- Port St. Joe Realty
Cell: 850-819-0833
WWW.MEXICOBEACHSALES.COM