Stephanie Lim

The Jacksonville real estate market, like many around the country, has been plagued with misinformation, scare tactics and the constant assurance from the industry that "things are really picking up." It is no wonder the Jacksonville real estate consumer doesn't know which end is up.

We believe that it is very important that the information that is put out should be backed up by facts and is not based on emotion or "feeling." We closely follow the overall Jacksonville real estate market as well as the Jacksonville sub-markets that we serve most frequently and can back up our analysis with facts.

"The market is really picking up." We hear this message constantly, and have been hearing it for the past two years from others in the industry. We've been hearing this since the market started trending down. Well the truth is that it's not picking up. We have no way of measuring if more buyers are looking. But a buyer looking, does not mean a thing if they are not willing to buy. Our statistics show that in January 2009 Jacksonville had the lowest number of closings we have seen. January demonstrated a significant decline from last January and even December of 2008. At the same time, we do not feel that the fact that the market is not picking up is negative. It's just a fact. Whether it is positive or negative depends on who you are and what your objectives are. It is a very positive thing for Jacksonville real estate buyers who decide to take advantage of the opportunity.

"Distress Sales are not the market." We have heard other agents say this, we have heard lenders say this, we have heard appraisers say this, we have heard sellers say this. We beg to differ. In January 2009 distress sales surpassed straight resales for non-condo sales in the Jacksonville real estate market. Distress sales (Jacksonville short sales and Jacksonville foreclosures) have increased from 8.56% of total sales for the month of December of 2007 to 43.62% of all sales for the month of January of 2009. During the same time period, straight resales (non-distress and non-builder sales) have decreased from 67.37% to 43.58%. Jacksonville Short sales and foreclosures are the market makers. Whether that is something an individual wants to hear or not, it is a fact. We do not understand how anyone could say that Jacksonville short sales and Jacksonville foreclosures are irrelevant.

"It is a horrible real estate market." No it's not! It's simply a real estate market. For buyers it would be incredible if they would realize it and get off of the fence. For sellers it's not so dandy...but it will all cycle back around again. We still don't understand why a real estate market is branded as being great when it's so heavily weighted to the sellers that buyers are having to jump through hoops to make them happy. Today's buyers should be walking on air!

"We're waiting on the bottom." You will not know when the bottom has hit until it is long gone. It will take several months of history to prove out the bottom, then it will take even longer it to be figured out and reported to you. If you are waiting for the bottom, you may find yourself back in the middle of an up cycle when the seller can make the rules.

"We don't want to buy if the market is going to fall further." This is really the same argument as the one above. There is no crystal ball. There is no way you can know whether it will or won't. But it is better to buy in a down cycle when the sellers are at a disadvantage than when a buyer is at a disadvantage. If you are buying to sell the home again in six months, sure, this is a valid argument. If you are buying a home to live in...please consider the complete picture and the opportunity this market presents.

"Short Sales Never Happen." Yes they do. While banks, in general, aren't as good at the process as we would like for them to be, short sales can and do happen. Based on our experience, we think that the biggest reason short sales fail is inadequate qualification of the seller, erroneous pricing, the submission of offers that are too low and the general lack of education. The use of a short sale specialist, whether you are a buyer or seller, can make the difference between success and failure.

No matter what your objectives, please keep in mind that it's all relative and you have to consider the source, and the basis of the arguments, when evaluating what the information means to you. The truth is that if you are a potential buyer of Jacksonville real estate, you should seriously consider making a move. If you are a Jacksonville real estate seller, you should seriously consider staying where you are if at all possible.

Thank goodness they are in the process of passing another stimulus package and are releasing the remainder of the old one. It's great that they are throwing more money at the bad decisions being made by banks. (No not really, that is dripping with sarcasm) The too big to fail argument doesn't fly with most of the people we talk to. The consensus seems to be that the most efficient and effective should ultimately survive. If inefficient, bulky big banks fail...others that are simply better at being banks will rise in their place.

Being in the middle of Jacksonville short sale action, we have seen and heard some really stupid things coming from the same big banks that have had major chunks of change thrown at them. First, we would like to say that we wish everyone could stay in their homes if that is their desire. Second, we think that the tide of Jacksonville foreclosures has to be stopped as much as possible, although we realize that there will always be some. This is reality even in strong, healthy real estate markets. Third, we also understand how the real estate market comes together, and we know that even if you pay all of your bills on time, what is happening in the Jacksonville real estate market IS having a negative effect on your wallet. And if you unexpectedly face a hardship, you might find yourself in the middle of a Jacksonville short sale on your own home. We've seen it happen to many responsible, hardworking people who would never have dreamed this could ever be their reality.

So on to a few bank stupidisms we've heard lately....the stupidism is in bold, our commentary is in italics.

We can't reduce your mortgage payment, you don't make enough money. But we will foreclose on you even though your home is worth $200,000 less and we will be at least $250,000 under after we foreclose on you and keep it on our books for a bit. And no we don't care that if we reduced your payment by $1,000 a month it would take 21 years of taking less to equal the same loss.

We can't delay your foreclosure sale until we approve your short sale package. No, we really don't care that we have had a complete short sale package with an accepted contract for two months and failed to act on it. We still won't delay your foreclosure sale until we've approved it.

No we won't reduce your mortgage payment even though you can prove true hardship. Why would we allow you to send us less money each month than what you owe us? We can keep it as it is and get nothing!

No we don't care if our appraisal is too high and if it was done 6 months ago. We stand by it and our net proceeds are based on that. We don't care if the market has fallen significantly...we demand that the buyer pay the amount based on an appraisal that came in too high even way back then. If not we'll just spend a lot more money and foreclose on you and put it on the market for less than what the buyer is willing to pay today.

We are swamped. We can not get to your file yet. Well we understand that there are homes that have sold for $30,000 less than our contract price recently but we'll get to it when we get to it. No we're not ramping up our loss mitigation and loan modification departments. We would rather acquire another failing bank with more bad loans with the government money we have received.

And here is one related to many or our short sale sellers. Although it is not directly related to the mortgage it is indirectly related as it increases their hardship.

No we won't work with you on your credit card payment even though you lost your job and can't find a new one. Instead will are going to increase your 5.99% interest rate to 30% because you are now high risk to us and you have missed mortgage payments. It doesn't matter if this will force you to quit paying. We will just get a judgment and freeze your checking account so you can't feed your family. We will recover less ultimately than we would in a couple of months had we left your payment alone or worked with you, but we are good with that because we are getting stimulus money.

And we are giving money to these entities allowing them to continue to make stupid decisions. We will continue to add more stupidisms as we encounter them. Feel free to contribute your own!