Jacksonville, Florida Real Estate - Defining a 'bad' real estate market?
It's not a secret. Everybody knows it. The real estate market is bad... bad, bad, bad! Right?
Maybe... or maybe not. I think it depends on an individual's perspective.
For the better part of the last two years, that's all we've heard and read in the news... the real estate market is bad. But what exactly does that mean? What makes it a 'bad' market?
As it is being described/defined in the media, a 'bad' market means that fewer properties are being sold now than were being sold a year ago. This reduction in the number of sales has very obvious and meaningful negative effects on businesses, individuals and the economy in general. Fewer sales means fewer workers in the immediate industry and the many support industries as well. There is no doubt about it... that is bad!
But what does this mean for individual home sellers and home buyers? Does this reduction in the number of sales/transactions automatically signal doom and gloom for them? More specifically, if you are in the market to either sell or purchase real estate, just how does this market shift affect you on a personal level?
The terminology used to describe this current "bad" market is Buyers Market. All this means is that there are more sellers in the marketplace than there are buyers. As with any market or product this results in lower prices (that's just basic economics).
Now, if we are talking about oil and we pick up the newspaper and read that it is a buyers market in the oil industry I dare say that most people reading this would say that is a 'good thing'. Why? Simple - because that would mean that we (consumers of gasoline) will be paying LESS at the pump. Why would we expect to pay LESS? Because the sellers of the oil would need to increase the volume of gas sold to make up for the shortage of buyers.
This is exactly what has happened in the real estate market. Just like oil, real estate prices got so high that buyers quit buying. And, in turn sellers are being forced to reduce prices on their real estate in order to entice buyers 'back to the pump'.
However, in Jacksonville a homeowner who wants to sell is still likely to make a decent profit (unless he happened to have purchased within the last year or two). If the seller has owned the property for at least 3-5 years, his ROI will, in most cases, be quite respectable. In fact, if he has owned the property for 5 years or more (and has not refinanced his equity in the meantime) he should enjoy a rather nice ROI.
All financial markets fluctuate. There are bull markets and there are bear markets. There are booms, busts and corrections. This is nothing new.
If you want to sell and 'move up' in price, this is an ideal time (if the reasons aren't obvious, contact us and we will go over it with you). If you need to sell, you have little choice but to sell at market value regardless of the amount of ROI you enjoy. If you do not need to sell now, then simply wait until the market turns again... it will.
Don't allow the 'big picture' cloud your 'personal and immediate picture'. Apply a little perspective to your individual situation and you may be surprised and encouraged to learn that it's not all bad... not by a long shot!
We invite you to visit our website and/or contact us to discuss your particular needs. We are more than happy to help in every way possible.
ABOUT THE BLOG OWNER
TIMOTHY H. FENNELL, PA
Tim Fennell is a Florida licensed Real Estate Broker with The Legends of Real Estate, REALTORS® in Jacksonville, Florida.
His strong background in business development, real estate investments, counseling and marketing greatly enhance his skills as a Listing and Internet Marketing Specialist.
Tim and his wife, Susan, have over 30 years experience in Jacksonville Real Estate sales, marketing and investing. Both are Accredited Consultants in Real Estate (ACRE®). When you're ready to be consulted with, rather than sold to, give Tim and Susan Fennell a call.