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For weeks I’ve been trying to come up with the perfect thought for this newsletter and found myself continually searching for something meaningful. When I first sat down to write Passover and Easter were upon us and I thought, what a great way to welcome in the new spring season by entitling my thoughts “A Second Chance.” This was a time when the Hebrews were saved from their captivity by the Egyptians and the angel of death passed over sparing their firstborn sons. For Christians, Christ’s resurrection was their second chance to realize there was life after apparent death and now there was the promise of an eternal life to come. While both holidays are rich in history today they are commonly seen as the welcoming of spring and one of hope.
To me, spring has always been a rebirth of sorts with flowers and trees coming back to life after a long harsh winter where it appeared they succumbed to the ravages of the snow and ice. People emerged from their homes after being cooped up most of the winter and everything just seemed more alive as the promise of summer with its warmer weather and outdoor activities was just around the corner. It was that euphoric feeling I wanted to capture, and one that has been on the faces of many we’ve seen this year who have decided to make Florida their permanent home in search of a better quality of life.
As much as I intended to embrace this theme, I found I was continually approached by many asking how to navigate a real estate market that seems more like a runaway train. What started as their euphoric journey to a new beginning has become anything but, as we are experiencing what has become a feeding frenzy. Wasn’t March supposed to come in like a lion, marking the beginning of spring, and exiting like a lamb? If that is the case, then April and May must be monsters and our “Spring” has more than sprung. Of course, I am referencing the real estate market and not the weather, as by all accounts our temperatures this season have been some of the most enjoyable we’ve experienced in a long time.
The real estate market on the other hand is something I don’t think anyone could have predicted. Low inventory levels combined with significant numbers of those looking to move to the area have created a unique market the likes most people have never seen. No longer is a full-price offer going to guarantee you’ll be the winning bid, in fact, most likely you’ll be looking from the outside in. Remember when a home that was on the market for ten days was considered a very new listing worth seeing? In today’s market, most people look at a home that has been on the market for ten days and wonder, “What’s wrong with the house?” Offers of $20,000, $30,000, $50,000 and moreover full price are now commonplace. Some are foregoing inspections and offering to compensate the seller on some of their closing costs. And did I mention “escalation clauses?” What is going on? For the seller, it’s almost like shooting fish in a barrel. Those who never thought of selling their homes are now thinking, “With the meteoric rise in offers, let’s put our house on the market.” Of course, that may be a double edge sword as once they sell their home they now jump into the tank with all the other buyers competing for the limited inventory on hand.
Others feel, “I’ll just wait for the housing market to crash, and then I’ll buy a home at a more reasonable price.” While I’d be as foolish as anyone to predict that will never happen again, after seeing what happened to the housing market in 2007 and 2008, I can tell you this is a very different market. Then we had much higher inventory levels and sub-prime mortgages were given to almost anyone who could sign their name. Today, most likely many would not be able to secure a loan under today’s lending guidelines. Then it was very much a speculative market driven by investors. Baby Boomers were supposed to be moving down for the next 20 or 30 years, so how could the sky ever fall? Unfortunately, we all found out, “Man makes plans and God laughs.”
What I’m seeing in the housing market today reminds me of the behavioral patterns of the panic hoarding we’ve seen when a major storm is in the forecast or during this pandemic. Fear of not having enough and grabbing as much as you can reach epidemic proportions as store shelves laid barren for weeks on end. I’m still trying to understand the rush on toilet paper, paper towels not to mention hand sanitizers! Since when did everyone become so obsessed with being germ-free? Go to a store today and the shelves are fully stocked once again, although I still have been challenged at times to find chicken wings! Panic shopping now seems to be a distant memory for some but now it has manifested itself in the housing market.
Having worked in the “concrete jungle” of New York City myself, I can understand why someone would want to move to Florida, but many states like Florida aren’t closing their doors to those looking to relocate for a better quality of life. For those waiting for the market to crash before they buy, you may be waiting for a while as this market is characterized by “end users, not investors. Inventory levels are much lower and you’ll be surprised by the number of cash buyers in the market. My advice is not to worry new listings are coming on the market every day. It may not be the home at the price you originally were after, but it is hard to put a price on the quality of life you will gain.
I feel life gives us lessons we can either learn from or repeat. When we couldn’t get the products we wanted during the pandemic, we found we could be just as happy with something that served our needs almost as well. We didn’t get to visit our favorite restaurants or entertainment venues as much, but most of us found enjoyment in the simple pleasures of early morning walks or bike rides together, perhaps even watching a Hallmark movie or two together.
Spring is a wonderful time of year and this year it is even more special as not only are flowers and trees coming into full bloom but so are we as a community now that many of the restrictions that have governed much of our lives for the past year are being lifted. The lesson we learned from the “pause” the pandemic forced on us was to enjoy each other and the pleasures life gives us. If we’ve learned our lessons from the past we don’t need to panic every time we encounter something we’ve never experienced before. Spring is in full bloom this season and perhaps more bright and full of appreciation and hope than ever before.
-Gary Cardillo
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