From:TheBahamasWeekly.com
Real Estate Advice in These Difficult Times
By James Sarles
Oct 5, 2011 - 6:50:12 PM
I have been a Real Estate Broker on
Grand Bahama Island for over 10 years and as a Broker the number one
question that people ask me is what is the future Of Real Estate
on the island. No one has a Crystal Ball that can see the future exactly
but with the current state of the economy there are many factors that
give us an indication of the Future of Real Estate on Grand Bahama
Island.
An important point to keep in mind
is that it is very difficult to make broad statements about the state
of the Grand Bahama Real Estate because there are many different Real
Estate Markets on the Island. There is a big difference between raw
land, lower income homes, high end beach front homes, condos and duplexes.
No one would ask you how the weather is in the United States because
that’s too general. The weather is of course different in Buffalo,
New York then in Phoenix, Arizonia. So when looking at real estate
we have to identify what sector of the market we are talking about
especially when looking at trends.
One of the biggest problems we have
on the island in my opinion for the local residential housing market
is lack of jobs and good paying jobs. This lack of jobs has caused
the local residential prices to fall. If the job market improves
you will see the real estate market in the residential market
and all sectors of the market improve. It’s that simple. Jobs
create consumer confidence and the ability for buyers to borrow
money from the banks for mortgages. Not only can people borrow money
but homeowners can pay their current mortgages
If you look
at The Freeport News there are growing pages and pages of Foreclosure
Homes being sold by the banks. As long as there is a huge supply
of Bank sales it will be difficult for a “normal” seller trying
to sell their home so they can move up, move down or change address
because buyers can buy bank distressed homes at highly discounted rates
if they have cash, a good job and good credit. Real Estate is
about movement and without movement you have stagnation which creates
a dead market. So in light of all this we don’t need a Crystal Ball
to tell us that there is high unemployment , an oversupply of homes,
a big supply bank foreclosures, banks not lending money and a flat real
estate market with prices going down because sellers can’t sell due
to lack of buyers.
So the future of the residential market in the short
term is going to be more of the same for the rest of 2011 and most of
2012. Until we can clear the inventory of distressed homes and the job
market improves the real estate market will suffer. This is a general
statement of the future of the entire market in the residential sector
which does not mean that there won’t be buyers and sellers but the
market will be very competitive and the majority of sellers will have
to continue to be patient in the residential local housing market.
If you are a seller in this sector be patient and do EVERYTHING you
can to make your house competitive in this very difficult market. Hire
a professional real estate agent and price your home for exactly what
it’s worth. The strategy of pricing a home high and letting buyers
make a lower offer can backfire. If you are a seller you are in competition
with every other house on the market and there are more homes on the
market than there are buyers hence it’s a Buyer’s Market.
Is the Real Estate market dead?
The answer is no. The real estate market is slow in the residential
sector however there are other some sectors of the market which
are showing some signs of growth. Income producing properties,
some vacation rental properties, and commercial property are showing
signs of recovery even in these difficult times. If you are an
investor with access to cash or bank financing there are really
good deals in this sector of the market. In all sectors of the market,
sellers have had to lower prices with buyers locally and from abroad
coming to our “depressed economy” looking for a deal. The good news
for buyers is that sellers are getting real and willing to take a real
look at offers. The offers are few and far between so real offers are
being considered.
As I have said so many times, Real
Estate has been and will continue to be the best investment you can
make for your future. Our down market can be looked at as an opportunity
. If you have been thinking about investing in Real Estate this is not
the time to sit on the side lines. This is the time to take advice from
successful investors like Warren Buffet who look a down market
as an opportunity to buy. You will not get any better deals then
now. Its easy to be “a would of could of should of investor”
but if you have a good steady job and cash for the down payment
now is the time to invest in your future through Real Estate . Interest
rates are low now and sellers are motivated. If you have been considering
a real estate investment now is the time. Do your homework. Research
the market. Work with the professionals and make a good deal.
I wish you all success with Real Estate. Until Next week !
Contact the author,
James Sarles at
Coldwell Banker - James Sarles Realty
james@sarlesrealty.com
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