Buying
a house these days can mean putting up a fight. A surprisingly strong
housing market this spring has put more homebuyers in the middle of
bidding wars in South Florida, buyers and agents say. The race for a
place is especially heated for families seeking homes from $200,000 to
$400,000, which are harder to come by.
"The words 'Make your highest and best offer' are like nails on a
chalkboard," said Judy Trudel, a buyer's agent in Broward and Palm Beach
counties.
Sean Zamora is typical of many exasperated buyers. The 32-year-old
charter manager for a yacht broker was outbid on four houses in Fort
Lauderdale, even though he offered near list price. He suspects that
asking the sellers to pay closing costs was the deal-breaker each time.
"It was just a big pain," said Zamora, who eventually bought a
two-bedroom home on the east side of town. "You just have to deal with
it. What can you do?"
Andy Constant figured he had some wiggle room on a three-bedroom
Parkland home listed for $419,900. He bid $380,000, only to be told of
another offer at $405,000.
Convinced that bidding eventually would stretch beyond the asking
price, Constant and his wife, Rachel, wanted to stand out from the other
buyers. So they offered $427,500 and wrote a personal letter to the
seller, saying they pictured their son playing catch in the front yard
and their daughter riding her scooter in the driveway.
"That was kind of the clincher," Andy Constant, 45, said of the letter. "It gave a personal flavor to the transaction."
The bidding wars are reminiscent of 2012 and 2013, when investors
started buying properties in bunches after prices hit bottom. Buyers
needing mortgages lost out to cash offers, while some buyers risked
losing deals if they took longer than a day to make a decision.
Heavy demand helped give the once-reeling market a boost and led to
double-digit price increases in Broward and Palm Beach counties. That
pace, though, couldn't continue, and the market cooled in 2014.
Now buyer urgency is back, fueled by loosening restrictions on
mortgages and young families eager to find something before the next
school year starts, agents say. An improving job market and low mortgage
rates also are contributing to the sales binge.
Palm Beach County sales rose 18 percent in April from a year ago, and
the 1,743 transactions were the most in a single month since 2004,
according to the Realtors Association of the Palm Beaches. Broward had
1,465 sales, up 10 percent from a year earlier, the Greater Fort
Lauderdale Realtors said.
Real estate observers had hoped that higher prices would persuade
more sellers to test the market, though buyers are still complaining
about a lack of quality listings.
Agents say a market balanced equally between buyers and sellers has a
six-month supply of homes, meaning it would take that long to sell all
of the existing properties if no more were listed. At the end of April,
Broward had a 4.8-month supply, while Palm Beach County was at five
months, according to the local Realtor boards.
While the two counties are starting to see more lower-priced homes for sale, most aren't in move-in condition, agents say.
"It seems like all the good stuff on the market is gone, and now
we're dealing with the listings that don't meet buyers' criteria," said
Beverly Rothstein, an agent for Berkshire Hathaway Home Sales. "It could
need a new roof or an updated kitchen, or it could be any one of 50
things."
Donna and Jim Stetson started looking for homes in northwest Broward
shortly after the first of the year, taking a conservative, if not
leisurely, approach.
After losing four houses to more aggressive buyers, the Stetsons
zeroed in on a four-bedroom home with a pool and a lake view in the
Westchester neighborhood of Coral Springs. The couple was determined not
to lose another home and beat out at least one other buyer in offering
$5,000 above the $349,900 list price.
"I hate bidding wars," said Donna Stetson, 58, a customer service
representative for a software provider. "It's anxious and uncertain and
just feels wrong. You give them a full-price offer and you still have to
'win' the house.
"It's not like the old days when you make an offer and get a counter.
You know what you're dealing with. In a bidding war, you don't know
what you're dealing with."
Keyes Co. agent Beth Patterson said one of her clients is struggling
to find a home in her preferred neighborhood, Lauderdale Isles in
southwest Broward.
Patterson said the client receives text alerts whenever one of the
homes comes on the market. They rush over to look at it as soon as the
property is available. In each case, the client lost out to a higher
offer or the home already was under contract.
In this environment, agents say, buyers shouldn't get cute. If the
home is in good condition and priced close to market value, it probably
will attract multiple offers. A strong initial bid and few contingencies
are the best bets for striking a deal.
Agents and analysts expect the sales pace to slow this summer, easing
the burden on buyers. Until then, they'll have to strike a balance
between staying vigilant and making a poor financial decision, Patterson
said.
"Right now their mindset makes them a little desperate," she said, "and more willing to pay more than they probably should."
Repost courtesy and Copyright © 2015 the Sun Sentinel (Fort Lauderdale, Fla.), Paul Owers. Distributed by Tribune Content Agency, LLC. Original post here: http://www.floridarealtors.org/NewsAndEvents/article.cfm?p=4&id=323905
