About Leon County, FL

Weems Plantation is a popular Northeast Tallahassee neighborhood that is undergoing some turmoil related to the age of the community, as are all newer neighborhoods around Tallahassee.

With home sales happening at half of our historical rate, we know that a shadow inventory of pent-up supply is growing, and thus so too will the list of homes for sale in Weems Plantation.

People who want to move, but know they owe more on their homes than what is worth, are growing in number. They want to flee, but do not know how.

The impact that this is having on neighborhoods in Tallahassee that are less than 15 years old is greater than it is on those that have been around for a longer period of time.

Why you say?

Because young neighborhoods all have one thing in common for certain. Everybody who owns a home there purchased it in recent years.

Everybody who lives in Weems Plantation moved in after June of 1999, and the majority of homeowners in Weems Plantation have been there 5 to 7 years. This means that normal move cycle trends forecast that the majority of homeowners currently want to sell their home.

All neighborhoods undergo this phenomenon as they grow out of their infancy, but unfortunately for Weems Plantation and other young neighborhoods, they are going through it during the worst real estate market to hit Tallahassee in a long, long time. I suspect if prices were to suddenly increase by 30% and buyers flooded back to the market (don't hold your breath), we would see a lot of homeowners step out of the shadows in Weems Plantation.

Because of this, there will be an abundance of supply on hand for many years to come. Homeowners who choose to sell a home sooner rather than later, will get the best prices for the next five or more years. The decision for homeowners will be to either sell immediately, or hold the property for 15+ years for the decision to make smart financial sense (I dedicated an entire previous post explaining how to calculate the best "financial" decision on whether to sell or hold).

Weems Plantation Home Prices

The average sales price of a home in Weems Plantation in 2011 was $157,800, which was down from the $209,000 average in 2006. The graph below shows no signs of the decline stopping anytime soon, even though the first and only sale of 2012 is higher. The percentage of recent sales that have been distressed properties is on the rise, which will make it even harder for arms length home sellers to compete for a sale in 2012.

Weems Plantation Home Values

Home values have fallen 25% in Weems Plantation, from nearly $150 per square foot in 2007 to an average of $112 per square foot thus far in 2012. With more short sales and foreclosures hitting the market, we can expect to see further real estate depreciation in Weems Plantation.

List Of Recent Home Sales In Weems Plantation

A question on many people's minds these days is whether you buy a home or wait until home values fall even further.

We know that home values will continue to decline over the next several years.

And we also expect that these historic interest rates will not last forever.

In an attempt to bring clarity to the "buy a home or wait" debate, I have set up a real estate model that will help most people understand that the answer is fairly simple, but it varies for each person's unique situation.

Do You Buy A Home Or Wait - The Model

In order to create the real estate model on the left, I had to start with some basic assumptions.

First of all, I assumed that the average homeowner would be able to borrow money at today's low interest rates. Were this not true, the homebuyer should be more inclined to wait, as home values are still depreciating.

Secondly, I assumed that the average homeowner would live in the home for ten years before selling. This allowed me to calculate a total interest expense to use in the comparison.

Finally, our model compares the cost of waiting (should interest rates rise) to the cost of not waiting (the real estate depreciation that will occur).

The graph shows the amount of "additional money" spent (in green) as interest rates go up. At 4% (today's interest rate), the amount is zero.

The red portion of the graph shows the equivalent real estate depreciation that would need to occur to equate to the same cash difference that rising interest rates would cost.

For example, if you are worried that property values will drop 10% between now and ten years from now, that would equate to a mortgage interest rate increase to 5.1%.

Using The Buy A Home Or Wait Model

Everybody has their own beliefs on what is going to happen to our economy, to mortgage interest rates, and future property values. This model can work for anybody.

Simply plug your strongest concern into the model, and compare it with "the other side of the coin."

If you are more concerned about rising interest rates, then start on the horizontal axis. Choose a rate you think makes sense, then look straight down and determine the "red" value. That will be the equivalent rate of depreciation needed to be the same as your anticipated mortgage interest rate.

My Thoughts On Mortgage Interest Rates Versus Depreciation

I am confident home values will continue to fall. The imbalance between supply and demand will take time to consume, and during that time, pricing pressures will drive values lower.

But I am also concerned that mortgage interest rates could rise. When they do, history tells us they will be moving swiftly, and low interest rates will be gone for good.

Based upon the economic impact for most families, it would seem that the risks of waiting are higher than the risk of buying now

Home values have dropped over 35%, thus the rate of depreciation from this point in should slow. All models that we use show values rising inside of the ten-year span that we have used for the model.

Historically low interest rates, coupled with the ability to cherry-pick a below-market value, make the "buy a home or wait" answer lean in the direction of buying now for a family that will live in the home for ten or more years.

Have you been waiting for the perfect time to sell your home? If you've finally chosen to take the plunge and sell your house this article has some awesome information!

WASHINGTON – Feb. 3, 2012 – If a bank writes off debt in a short sale, it’s a “taxable event,” and the lender tells the Internal Revenue Service about the deal by submitting a “Form 1099-C, Cancellation of Debt” at the end of the year. Home sellers must acknowledge the amount when they fill out their federal taxes. Through Dec. 31, 2012, however, the federal government forgives any tax liability associated with forgiveness of a mortgage loan.

“In general, homeowners believe the government will extend this tax provision,” says San Diego Realtor Joy Bender. “However, as evidenced by the First Time Homebuyer Credit expiration in 2010, you can’t always count on the government to bail you out.”

The government generally considers forgiven debt to be income. If a seller has signed legal loan papers to take out a $200,000 mortgage and the lender accepts $100,000 in a short sale, for example, the seller received the equivalent of $100,000 in free money by government estimates. As a result, the IRS taxes it. For tax year 2012, however, the government still forgives the debt; in 2013, it might not.

The tax amount can be significant. On a debt of $100,000, a short-sale seller in the 25 percent tax bracket could end up owing $25,000 in income taxes.

Since short sales can take months and even fall through, homeowners considering a short sale may want to start the process sooner rather than later.

© 2012 Florida Realtors®

Yogi Berra has said a lot of things about baseball, but what would he he say if asked about Selling A Home in 2012?

Berra was a fifteen-time All-Star, and the Major League Baseball MVP three times, in 1951, 1954 and 1955. While he is arguably one of the best baseball players of all time, he is better known for his "yogi-isms," his wonderful way with words.

I thought it might be interesting to apply some of his most often quoted expressions, but use them in reference to Selling A Home.

Yogi Berra On Selling A Home

"Overwhelming underdogs" - if two homes are equal, then price is the only differing factor. If you want to sell a house in 2012, then it is your job to make sure your home is "equal to" nicer homes, not lesser homes. You do this by making sure it is impeccably groomed; it should be maintained for expected showings 24/7.

"If the world were perfect, it wouldn't be" - A home's value is relative. It is relative to all the other homes that are available the day that a homebuyer is going to make a purchase decision. No matter how much you think your home is perfect, others will see it in the context of all of their other choices.

"If the guy was poor, I would give it back" - Yogi's reply when somebody once asked what he would do if he found a million dollars... Every home could be somebody's castle, as well as somebody else's dump. No matter how nice your home is, somebody in the world (i.e. the Queen of England) could not fathom living there. The opposite is true as well. Marketing your home as "nice" or "fantastic" is generally a waste of time, it should be targeted to a specific expected buyer pool.

"You've got to be very careful if you don't know where you're going, because you might not get there" - You need to be focused on getting your home sold all the time. You have to understand that there are more sellers than buyers right now, so Selling A Home is like being unemployed, you always have to be ready for a job interview. Not maintaining your home is like going on a job interview and not bothering to comb your hair.

"It's deja vu all over again" When you hire a real estate agent based upon the price that the agent says she can get for your home, then most likely you are going to be disappointed. 64% of all homeowners hire the first agent they interview, primarily because they "like" the agent and are happy with the "promised" sales price. This is something that hasn't changed in my 20+ years in real estate and these homeowners end up having to hire another agent for the job of really Selling A Home.

"I usually take a two hour nap from one to four" Open houses are for information seekers. Always have been, always will be. It's a great chance for real estate agents to meet future home buyers, but history teaches us we have less than a 1% of Selling A Home through an open house. You should demand your agent use their time marketing your home to people who might actually buy it.

"The future ain't what it used to be" We know that 94% of home buyers are using the internet. Shouldn't the real estate agent and real estate company you hire for Selling A Home be spending 94% of their marketing time and marketing budget on the internet?

"You can observe a lot by watching" - All you have to do is spend about an hour on the internet, and you will find the most aggressive regional company that dominates the internet for Selling A Home. Just google "top real estate agent Tallahassee, FL" (or whatever your city) and you will find out who most likely can drive the most local, ready buyers to your home.

Selling A Home In 2012

There is no reason for you to be baffled about Selling A Home in 2012. If you want to find out what your options are, just drop me a note and I will walk you through how the top real estate internet marketing plan will get you top dollar in today's difficult housing market.

I hope you found the clarity and wisdom in Yogi's thoughts, as they surely will help you if are planning on Selling A Home in 2012.