Lee Forbes - with The Cegnar Team! #1 Preferred Agent! CRS, GRI, ABR, E-Pro

Good afternoon! Another week, another great speaker lined up for the wonderful members of the ManaREIA! We have Guenter Manczur, a CCIM with Calkain Realty Advisors coming to talk on, "Let's Go To Commercial Break: Making Money on Commercial Real Estate Deals." Diversification is such an overused term, but as with any cliché, there is truth at the core. Should be a great chance to see how you can buy your next Starbucks franchise. See you then!

MIKE TULLIO, DIRECTOR

(941)228-1020 CELL (866)415-7805 FAX

WWW.MANAREIA.COM

WHEN: Fridays from 11:45-1:15 PM

WHERE: New China Buffet at 8341 Lockwood Ridge Rd. Sarasota, FL 34243

Click here for directions. We'll gather in the meeting room to the right of the buffet.

Last Tuesday Citigroup joined JPMorgan Chase and Bank of America in announcing a major loan modification program. The bank's CitiMortgage unit is offering to modify the terms of mortgages for borrowers at risk of falling behind on their payments. The Citi Homeowner Assistance program plans to contact about 500,000 homeowners in the next six months, involving up to $20 billion in mortgages. Citigroup's loss mitigation efforts have already prevented about 370,000 foreclosures on $35 billion in loans since early last year.

That same day, administration officials in Washington announced a plan for refinancing delinquent loans held by Fannie Mae and Freddie Mac, the now government-controlled giant mortgage companies. This could result in lower payments for hundreds of thousands of homeowners. The program builds on the Hope Now program already in place. The goal is to reduce mortgage payments to no more than 38% of a family's monthly income. Slowing the pace of foreclosures is key to our recovery and these programs all help.

You probably heard foreclosure filings were up in October, 25% over the previous year. But foreclosure filings were up only 5% over the previous month and some states actually had declines. Lost in all the noise was the fact these filings don't all wind up as foreclosures. Borrowers are able to refinance their mortgages, negotiate loan modifications, workouts or short sales with lenders.

>> Review of Last Week

RISKY BUSINESS... What's going on now in the economy is being called risk aversion hysteria and that's an apt name. Unfortunately, what the hysterical avoidance of risk actually does is create more of it. With all the talk of a credit crisis, a shrinking economy and fewer jobs, people decide to be more careful with their money. This tanks consumer spending, which gets Wall Street worried, and stock prices swoon - so we wind up with a riskier environment.

A sterling example of this popped up last week. Part of the market's poor performance was tied to the terrible 2.8% drop in retail sales for October, which was directly linked to the current consumer aversion to risk. But it should be noted, if you exclude autos, building materials and gas, "core" retail sales fell only 0.5%. Still a decline, but smaller than the previous two months and, in fact, UP 1.3% over last year. We also want to point out that some economists expect October to be the worst month for retail in the recession and are projecting a "V"-shaped recovery, with growth coming back by Q2 of next year.

On the positive side, the Chinese government announced Monday a $586 billion plan to stimulate their economy. This set off a stock rally in China and inspired some good moves in our own markets for a while. And please also note that crude oil closed the week at $57.04 per barrel. But we did have lower earnings outlooks from a handful of retailers, plus Intel, who showed that techies can be cautious too. There was much hand wringing about whether the government should bail out the US auto industry. The week ended with the G20 countries meeting over the weekend in Washington to talk more about fixing this crisis and preventing future ones.

It was a super-volatile week in the markets, with a 911-point swing in the Dow on Thursday, when it closed up 552 points, its third-biggest gain ever. But for the week, all indexes ended down. The Dow was off 5.0%, at 8497.31. The S&P 500, down 6.2%, went to 873.29. The NASDAQ lost 7.9%, going to 1516.85.

The bond market moved around all week. But the benchmark 10-year Treasury ended up, so its yield, which runs counter to price, went a tick lower, finishing at 3.725%, nicely below the 4% threshold. Borrowers can expect mortgage rates to remain at historically low levels, where they've been for quite some time.

>> This Week's Forecast

REMEMBER INFLATION?... Doesn't seem to be as much of a problem now as it was just a short while ago, but just to make sure everything's still OK, we can check on the Producer Price Index (PPI) on Tuesday and the more critical Consumer Price Index (CPI) the next day. The FOMC minutes on Wednesday will explore the Fed's head set at their October 29 meeting. Then the Philadelphia Fed Index will give its indication of our economic state. Thursday evening we'll hear more on the economy from Treasury Secretary Paulson.

A few biggies will report Q3 earnings this week, including Lowe's, Target, Home Depot and Dell.

Lee Forbes

LeeForbes.com

Gulfsideland.com (search over 118,000 active listings across Florida!)

Open houses are only to make a Seller feel like you are doing some kind of active prospecting but it really isn't. Open houses are for you to find buyers to work with and an ocasional 1% chance they might want the home you are holding open.

I suggest you stop spending advertising money on open houses and stop waisting your weekends. If you want to make them productive for your business then use them for you. ie: Only hold open houses in communities you farm. Put up a zillion directional signs in the community that really are there to brand you to the neighbors. Hold the home open during the week leaving the weekend for hot buyers. only hold the home open for an Hour. Yes, one hour!

*** here is the key*** Walk door to door around the community and hand out a flyer about the home encouraging the community to visit the home. ** Nosy neighbors are really interviewing you as a listing agent for selling thier home!! Use open houses as a listing tool!! Now that is what I call Active prospecting!!

Lee Forbes CRS, GRI, ABR, E-Pro

Broker-Associate

9115 58th Drive East
Bradenton, FL 34208

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Our local news paper got it right this time with a long interview and statistics review with me for this article. I am glad to see a writer that truly listens and finds the facts showing hot areas in our current market.

Here is the article for those who would like to read.

By Aaron Kessler

Published: Monday, October 13, 2008 at 12:10 p.m.
Last Modified: Monday, October 13, 2008 at 12:41 p.m.

The housing market and the economy as a whole may be struggling mightily, but as home prices in the region return to where they would have been -- and perhaps should have been -- all along, if not for the boom years, there has been one positive result: housing has become affordable again.

Lee Forbes, an agent with Re/Max Alliance Group, compiles data on local housing sales every month by price range.

With the fall in prices, regular people who live and work in the Sarasota-Bradenton area are again able to buy a home after prices had shot up so high during the boom that the typical salary could not keep up with those inflated values, Forbes said.

That did not stop some banks from making risky loans to people who should not have been getting them. That thinking led directly to the bust the entire economy is now experiencing.

But the drop in home prices does have the effect of bringing the market back toward equilibrium.

Forbes said people are buying again -- and the price range that is really moving at the moment? Roughly $200,000 and under.

"It's affordable out there right now, finally," Forbes said. "People who work in the service industry in Southwest Florida, who are teachers, who are cops, that's their price range. And so we're seeing a lot of activity."

Forbes said homes going for less than $150,000 are even more "the hot properties right now." "That is where a lot of bargains are being found," he said.

Sales data for August -- traditionally the slowest month of the year -- show that in Sarasota County, out of 343 single-family homes that sold, 194 were priced at $200,000 and under. One hundred forty-one of those sales involved homes that went for $150,000 and under.

One of the most significant factors in determining the health of the housing market -- months of supply -- also showed that the lower price brackets were doing much better than their higher-priced counterparts.

A six-month supply of inventory is considered normal, when the supply and demand are in a natural balance. In August, Sarasota County as a whole, for example, averaged about 20 months of supply.

Homes priced between $100,000 and $150,000, however, clocked in at only 12.4 months of inventory.

Meanwhile, those priced at $100,000 and under -- a range that during the boom could not even get you a mobile home but that now features some good two-bedroom, one-bath starter homes and other opportunities -- were doing even better. Only 10.3 months of inventory remained, Forbes' data shows.

In Sarasota, 56 homes sold for $100,000 or less in August, and 318 such homes sold in the past six months.

On the flip side, homes hovering under the $500,000 mark are proving very difficult to sell.

"When we're talking about 400, 450, 500 -- those have been stagnant across both Sarasota and Manatee," Forbes said. "Those people are really stuck."

In August, only three closings took place for homes priced from $450,000 to $500,000. In terms of inventory, sellers are looking at 79.7 months of supply -- the highest of any bracket tracked.

Forbes said those price ranges are truly getting into executive-level homes, and there simply are not enough buyers anymore in the Sarasota area.

"We only have so many corporate executives and corporate headquarters in this area," Forbes said.

Of course, it was not always a dead zone for those with $450,000 homes on the market. Forbes said when the overall inventory in Sarasota-Bradenton hit its peak after the boom, homes in that price range were actually doing quite well.

"But that was everyone trying to get out, and now those who didn't are facing a tough time," he said.

Even those with million-dollar properties saw a better August than those trying to sell in that $450,000 to $500,000 range. Nine sales closed between $1 million and $2 million, with 42 months of inventory still remaining in Sarasota County.

Meanwhile, while prices have continued to drop this year, the sales figures indicate that many sellers in the Sarasota-Bradenton area are still trying to ask too much for their homes.

In Sarasota County, the median list price for a single-family home in August was $199,000, according to Forbes' data. But the median sold price was only $177,300.

Looking at the average instead of the median, the average list price for Sarasota during the same period was $375,070. But again, the average sold price was only $329,982.

In Manatee County, there was also a disconnect between what sellers wanted and what buyers were willing to pay.

Manatee single-family homes were listed for a median price of $275,000, but sold for a median price of $255,000.

One group of sellers who apparently are not having any qualms about lowering their prices are banks.

The number of bank-owned properties that have been seized in foreclosure continues to increase. Lenders are proving to be some of the most motivated sellers in the marketplace.

"Foreclosures are selling like hot cakes," Forbes said. "They are lasting a few weeks on the market, and that's usually it before they're selling right now."