Archive for the ‘Naples Real Estate Market’ Category

Don’t let the select Naples real estate “best buys” pass you by…

Sales according to Naples Area Borard of Realtors stats increased by 20% the end of the last quarter.  We have been chipping away at Naples property inventory and all indicators are pointing to the stabilation of our market in area pockets, particularly the higher end.

There is only so much Beach and waterfront properties to spread around.

Call today to find your piece of paradise 239-269-8889

Pending Home Sales Show Another Gain

By LAURA LAYDEN

Naples Daily News

NAPLES — America’s money is moving to Collier County. According to a story on Forbes.com, the county tops the list of where the rich are moving to in big numbers.

The No. 1 ranking is based on an analysis of tax returns filed in 2008, the latest year for which IRS data is available. It doesn’t come as that much of a surprise.  Naples has long been known as a hot spot for wealthy retirees and Fortune 500 executives.

In 2008, Naples-Marco Island ranked third in the country for its personal income. The metro’s per capita income was $62,559, 156 percent of the national average of $40,166, according to the Bureau of Economic Analysis. Per capita income is total income divided by population. It includes wages, dividends, interest, rental income and government payments, such as Social Security.

The bottom line is Collier County is still a highly desirable place to live,” said Michael Reagen, president and CEO of the Greater Naples Chamber of Commerce, in an e-mail. “In addition to the natural beauty and friendly culture, we are experiencing an advent of opportunity.” He said businesses are beginning to seek out the area because of its desirability, which could bring more wealth to Collier County. “Advances in technology and infrastructure have made it such that businesses are no longer tethered to the industrial centers of yesterday – business leaders can choose where to set up shop and much of that depends on a certain level of quality of life for themselves and their employees,” Reagen said.

The analysis of tax returns by Forbes.com showed 15,150 people moving to Collier County from other parts of the country in 2008. Their average reported income? More than $76,00 per person – or the equivalent of more than $304,000 for a family of four. The Forbes analysis showed that more taxpayers moved out of the county than into it in 2008, but the average income of those who left came out to $26,128 per person.

Wealth attracts wealth.

When wealthy residents invite their friends for a visit, their friends often will decide to move here themselves, said David Morgan, a financial planner with Raymond James & Associates in Naples. Collier County offers a slower high-end lifestyle, with more privacy than in many other places around the country.

While some flaunt their wealth, others don’t like to show it off. There are places for them to go that are inclusive and exclusive in Collier County. “While they’ve worked hard for their money they’ve earned, they don’t necessarily want to the world to know about it,” Morgan said. “That’s very easy to do over here, to keep calm and quiet about it if you want to.”

This year, home resales for $1 million and up in the Naples area have picked up as wealthy buyers take advantage of the lower prices, offering them more for their money. Naples Realtor Michele Harrison, with John R. Wood Realtors Inc., said Naples will always be a destination for the affluent. “I think in Naples we see a more conservative affluence,” she said. “We still don’t know who lives here, do we? The anonymity that we provide them has been here and always will be here.”

The Forbes analysis shows that the households moving to Collier County in 2008 primarily came from other counties in Florida, including Lee, Miami-Dade, Broward, Palm Beach and Orange.

“We’ve got certainly less crime in our area of the state,” Harrison said. “That’s got to be appealing to people that are living on the east coast, who can afford to make that move.” Good schools also help to attract new residents, she said. According to Forbes, Lee County actually sent the most people to Collier in 2008 – 2,987. Among northern areas, Cook County, Ill., Oakland County, Mich. and Suffolk County each sent more than 100 people to Collier.

Ranking second on the Forbes list for areas where America’s money is moving to is Greene County, Ga., with a population of less than 16,000. The Forbes review of tax returns showed 788 people moving to the county in 2008.

Two other areas in Florida made the top five: Nassau County near Jacksonville and Walton County east of Pensacola. The other top-ranking area was Llano County, Texas at No. 4 on the list. Robert Shrum, a manager of state affairs at the Tax Foundation in Washington, D.C., told Forbes.com said the dominance of Florida and Texas counties on the list of where America’s money is moving to make sense because neither state has an income tax.

“If you’re a high-income earner, then that, from a tax perspective, is going to be a driving decider if you’re going to move to one of those states,” he said.

By KATY BISHOP

NAPLES — Stephen Campolo watched as his former neighbors tore apart their houses, carting away cabinets, tiles and toilets in U-haul trucks.

He wondered who would buy a toilet ripped out of someone else’s bathroom. Worse, he worried that no one would buy the three foreclosed houses across the street.

Weeks passed and the grass grew knee-high in front of the homes in the gated, Golden Gate Estates neighborhood of Valencia Lakes. But recently, things started looking up: An investment company bought one of the houses and contractors started arriving to throw out trash and fix up the house.

Flippers are buying beat-up, damaged properties, remodeling them and then reselling them for profits of 10 percent to 12 percent of the final sale price. It’s happening in gated and non-gated communities in Naples, Golden Gate, Golden Gate Estates and Naples Park.

They were blamed for driving prices sky-high during the bubble, but so far, residents, homebuyers and experts say these next-generation flippers are serving an important purpose. They’re paying cash for properties that nobody else wants — properties that often aren’t eligible for financing for typical buyers — and making them into homes people want to buy.

It’s changing neighborhoods across Southwest Florida, street by street.

“This is a non-financeable house, so unless an investor bought it and fixed it up, it would sit here and rot,” said Mike Conte, with MFC Investments, standing inside a foreclosure his company recently purchased.

It was Conte’s first time inside the house in Valencia Lakes, and he picked his way gingerly around the kitchen, feet crunching on shattered glass and sugar on the floor. He examined broken cabinets and eyed chewed-on chicken bones in a take-out container on the counter.

The company paid about $150,000 for the 4-bedroom, 2,724-square-foot house at an auction and will probably put about $40,000 into it, Conte said. They’ve listed it on their Web site for $215,900, noting that it will be completely remodeled.

Because the company can’t get inside foreclosed homes before purchasing them, they often don’t know quite how much damage a house has when they bid on it at auction, Conte said.

This house had more extensive damage than he expected, so their profit may be less than he had hoped. They’ll have to completely rebuild the kitchen and the bathrooms, and replace all the fixtures.

Conte’s target profit is 10 percent to 12 percent of the purchase price, so if it sells for the listed price of $215,900, that would be $21,590 to about $25,900. But with at least $190,000 invested in the property before Realtor commission and recording fees, that probably isn’t realistic.

Risk is all part of the game, Conte said.

After buying the property, Conte’s company usually turns around the house in less than 45 days. They have flipped about 100 houses in Naples since the beginning of 2009.

“We are increasing the value of the property and increasing the integrity of the neighborhood,” Conte said. “There are certain streets where we’ve renovated many properties and they look different. For example, Coconut Circle (in East Naples), where we’ve purchased a few properties and they’ve gone from boarded-up properties to fixed-up properties with people living in them.”

Foreclosures have an increasingly negative impact on the property values of the houses surrounding them, said Shelton Weeks, real estate professor with Florida Gulf Coast University’s Lutgert College of Business.

Each foreclosure within one-eighth-mile of a single-family house reduces that house’s property value by 0.9 percent to 1.136 percent, according to a study done in Chicago in the late 1990s that combined foreclosure data with property transactions.

So, say your house was worth $300,000, and your next-door neighbor forecloses. Your property values would decrease only by about $2,700 to $3,408. But if there are five foreclosures within one-eighth-mile of your house, your property values decrease by $13,500 to $17,040.

For example, on 25th Court Southwest in Golden Gate, a street that’s about a quarter-mile long, there have been a handful of foreclosures and short sales recently. Each sat vacant for a time, but many were purchased by investors.

Sylvia Martinez, 53, bought a house on the street in August 2009, and after that noticed a lot of activity in neighboring houses: Construction, and then “for sale” signs going up and new neighbors moving in.

“There’s been a lot of movement since I purchased,” she said. “In the beginning, I was very afraid to move to Golden Gate city, but I’m a single mom and I’m paying everything for myself, and the only opportunity that I had to buy was in this area. Now, I feel very different. The street that I live on is very quiet, and I like it. It’s nice to have neighbors instead of empty houses.”

Often foreclosed properties aren’t eligible for financing, especially with strict Federal Housing Authority loans, because they lack appliances, air conditioners, water pumps or have torn-up kitchens or bathrooms, said Brenda Fioretti, real estate agent and president of the Naples Area Board of Realtors.

Fioretti called the remodelers “investors” _ not flippers _ and agreed that they are serving an important market function right now.

“When you see people come into your neighborhood and fix up and buy properties and immediately try to flip them, it makes people a little apprehensive,” said Shelton Weeks, real estate professor with Florida Gulf Coast University’s Lutgert College of Business. “But when (a house) goes into foreclosure it’s as if it’s sort of fallen off the grid. The only thing that’s going to get that back into the system is a (buyer) who is going to do all the work themselves or a company that’s going to fix it up and get it back on the market.”

Olivia Hernandez, 45, needed a house that was in good condition for her family of five, and she had heard horror stories about buying foreclosures from banks. When she stepped into a move-in ready, five-bedroom house in Golden Gate Estates and saw that it had a huge family room, she knew it was perfect for her four kids.

Hernandez bought the 2,280-square-foot house for $143,000 in December 2009, three months after an investment company purchased it as a foreclosure for $121,100.

“I don’t know if it was remodeled,” she said. “All I know is that when we saw it, it was ready to move in. All the walls are white. It was just move in and paint the walls the colors that I wanted to make it my own.”

Asked whether the flippers and investors eventually might drive up property values and create another real estate bubble, Weeks, the FGCU real estate professor, said no.

“There’s so much inventory and the financing landscape is so much different than it was during the bubble,” Weeks said. “The chance of a secondary bubble resulting from this is minuscule. Swings in real estate markets tend to happen over very long periods of time.”

SOURCE: NAPLES DAILY NEWS, http://www.naplesnews.com/news/2010/apr/17/theyre-backflippers-snap-foreclosures-remodel-and-/

Washington, March 23, 2010

Government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac should be restructured as government-chartered, non-shareholder owned authorities, the National Association of Realtors® said in congressional testimony today.

“We want to ensure a flow of capital into the mortgage market regardless of the state of the market or economy,” Vince Malta, NAR vice president and liaison to government affairs, testified to the House Financial Services Committee. “The new Fannie and Freddie must ensure there is always mortgage capital available for creditworthy buyers and that taxpayer dollars are protected.”

In outlining NAR’s proposal, Malta cautioned Congress and the administration about moving too quickly in restructuring the GSEs. “The housing recovery is still too fragile for the government to completely step away, and any disruption in the marketplace now by doing something too radical would be harmful,” he said. “Our goal is to help Congress and our industry design a secondary mortgage model that will serve America’s best interest today, and in the future.”

Neither a fully privatized entity nor a fully nationalized structure for the secondary mortgage market giants effectively addresses the critical issues of loan availability and taxpayer protection, he said. A fully private entity would foster mortgage products more aligned with business goals rather than the nation’s housing policy for consumers. “In difficult markets, like today’s, private lenders have not been willing to make loans without government backing,” said Malta.

A fully federal structure would put taxpayers at risk. “We want to eliminate any scenario that would place taxpayers on the hook to protect these entities. And to combine the two, or merge them with Ginnie Mae, would remove competition in the secondary market, and the new entity could lose focus on it missions to serve low- and moderate-income families and maintain liquidity in the mortgage markets,” he said.

The new authorities should be subject to tighter regulations on products, profitability and minimal, retained portfolio practices in a way to ensure protection of taxpayer monies. The new entities would also concentrate on standard mortgage products that are the foundation of the housing finance market.

“While that might curtail some private participation and alternative products in this market, we believe privates will offer innovations that meet consumer needs. The new entities would focus on safe mortgage products, including 15- and 30-year fixed rate mortgages and traditional adjustable rate mortgages.”

Malta also submitted a list of further recommendations.

The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1.2 million members involved in all aspects of the residential and commercial real estate industries.

SOURCE: www.realtor.org