Michael Polly

It was 94 today and my pool was 92. Hard to cool off even getting wet. The real estate market in Lee County is experiencing the same heat. Sales are registering a blistering pace with 1742 pending resale homes in Lee County.

Inventory fell to 10,300 single family resale homes. That's one percent less than last month. Pending sales were almost 2% meaning there is new inventory still out pacing sales.

Of the sales, over 61% were under $100,000. With out these, sales would be 1072 less. This is the market that is on fire and where buyers are seeing values they can't pass up. Homes above this price are still facing an uphill battle with some upper price ranges facing 100 months of inventory. Current available inventory is available in real time at HOMEY.com

Still seeing this level of demand speaks well for the interest of people to be near our waters and living in the hot sunshine of SW Florida. The heat that's here even when the artic wind blows in the north. Remember to put the sunscreen on when your on the beach New Year's eve.

Michael Polly

http://www.michaelpolly.com

Tomorrow President Obama will visit Fort Myers for a townhall meeting. Here he will discuss the economy and our economic outlook. Both President Obama and this area have a long road to recovery ahead.

He is scheduled to visit Lehigh Acres and look at the foreclosure problem faced in this area. The media will no doubt talk about how bleak things look and no doubt they appear that way. However there is another view point.

Many people in this country and others would love the opportunity that is presenting itself if they only knew about it. When in the last 30 years can you remember a time when you could buy a newer home, close to the beach, where the sun shines on average 340 days a year. Where the temperature averages in the 70s and 80s and boats are almost as common as cars.

I think the media will focus more on the negative rather than the positive. So if you or anyone you know has ever thought about walking in the sand on a warm winter evening or playing some of the top golf courses in the country then tell them now is the time.

Michael Polly
Vice President

Denny Grimes and Company, Inc.

Check out our new search engine: HOMEY.com

Sheep, Comptrollers and Rum provide much needed relief to wallstreet.

My reasons why the new and improved bailout plan is our new hope. A chance for a new beginning and will save our homes and economy from impending doom.

1. Increase in limit on cover over of rum excise tax to Pureto Rico and the Virgin Islands

While not well written "cover over of" know that on our next cruise or visit to the southern carribean we'll all be in good spirits! I could probably not even go into point 2 and 3 of why this great plan will work! Directly from the bill I kidd you not.

2. Study and Report on Margin Authority

Directly from the bill "The Comptroller General shall under take a study to determine the extent to which leverage and sudden deleveraging of financial institutions was a factor behind the current financial crisis."
It does not say what this will cost, I'm sure a fraction of the whatever billion. Doesn't it make sense to you that this would be something we would have already done to determine how to fix and prevent the current problems. Maybe before we put pen to a 451 page bill that contains more cr*p than a biomass refinery. Which by the way is also in the bill... that we would have already done as much analysis as possible before something of this magnitude.

3. Extension and modification of duty suspension on wool products; wool research fund; wool duty refunds.

Now, there you have it. No pulling the wool over the public's eyes. We will all be rich next year from our tax break for the suspension on wool products and the wool research fund. I can't make this up.

Does this sound like I made this up. When I tell people about these subtitles and sub-sections they do not believe me. My dog looks at me this way when I try to explain carbon dioxide sequestration. If you don't understand this either search for "carbon dioxide sequestration" in the bill. You'll find it.

The bill is here in pdf format for your reading pleasure.

Do I think something needs to be done. Yes, when I make a bad decision there are consequences. There are people who need to pay for allowing this breakdown in our lending and banking policies. They were elected or hired to protect us from bad lending rules and wallstreet greed. There are CEOs and others that have profitted from this. Yes, we need intervention but we need accountability first or it will happen again.
There you have it. Housing and economic crisis has been averted. You can now go do your income averaging for amounts received in connection with the Exxon Valdez litigation. You guessed it, also in this bill.

Whew!



- Michael Polly

My rants and raves with a bail out plan.

Three big questions are on everyone's mind today regarding the governments bailout of our financial institutions. 1) After a weekend to crunch options is this the best one? 2) Is it necessary? 3) Will it ultimately work? No one seems to have these answers.

Last week when the Federal Reserve and the US Treasury Department decided that we were in a mess and finally came to the realization of how dire a problem it is. This is my first problem. In a digital age where we wait for nothing, fast food, instant messaging and electronic everything, our economic system seems to still be using a quill pen. The definition of a recession to CNBC is 2 or more straight quarters of negative GDP. (Gross Domestic Product a measure of national income and output.)

To me that is like the TV weather reporter telling you it is clear out and it is pouring down the rain. STICK YOUR HEAD OUTSIDE AND LOOK BEFORE YOU SPEAK! Foreclosures, poor job outlooks, bad credit and failing banks have been here for months. Yet we have to wait until near collapse to be motivated enough to find try and fix it? We had to know in this age of instant everything, yet money puts blinders on many people. The plan does not seem to address people losing their homes. It does address saving big corporations who all have Wallstreet addresses.

Second problem I have with this type of intervention from our government. My father worked for 33 years for Bethlehem Steel from late 50s to the late 80s. He had a good job with a good US company. Foreign imports of steel and failure to be competitive caused the company to fail. My father lost his benefits and all that he had worked for. His retirement was worth zilch, zero, nada. No golden parachute for someone who dedicated his life to the company he worked for. In 33 years he had worked his way from shoveling coal to foreman of a mining operation when he retired. No government bailout either for this long time American steel company.

Last, lots of companies fail with good ideas and bad decisions. Some fail with bad ideas and good decisions. Yet they fail just the same. It is the price to be paid for mis-management. It is also the way our country was built. The strong survive, the weak, well they get bailed out in 2008...

I believe that Fed Chairman Bernanke and Treasury Secretary Paulson were on target to be afraid we were headed for a disasterous situation with our banks and money market funds. Maybe a year too late...

By Michael Polly

Tropical Storm Fay has come and gone, but the rain it dumped on Lee County lingers. The ground is saturated and some streets are flooded. As much as we needed the rain, we are anxious for the way things used to be, like being able to walk to our mailbox without wearing our slickers.

Likewise, we witnessed our real estate market raining inventory for the past couple of years. It rained so hard and long that you could forget about walking to the mailbox, because the only way to get to it required something with Evinrude on the back of it. Our inventory is still at record levels, but we may have reached the high-water mark. In fact, in some sub-markets, inventory is receding.

A few observations after looking over the resale home contracts for July:

The number of homes for sale in specific submarkets is starting to dry up. Buyers are recognizing the value being offered today. Our real estate market, like the recent rain, had a problem with "run off." Buyers would make an offer on a property and if the seller didn't accept the offer, the buyer would just "run off" and make an offer on a different home.

Single-family homes that went under contract in July sold within 2 percent of the original list price and were on the market less than 45 days.

In contrast, homes that sold for more than a 2 percent difference from where they were originally priced and where they were priced when sold, took 148 days to find a buyer on average. More importantly, they averaged only 80 percent of the original list price. What this tells me is that when the numbers are in line, so are the buyers. Being realistic up front can save sellers money and time.

Buyers are recognizing a value priced home. In July 40 percent of the homes that went under contract had been on the market less than 30 days and went pending within 98.8 percent of the original list price. There was no run off as the buyers absorbed the value-priced homes. Having young families and first-time home buyers own and live in these homes is a foundation our market needs to be strong.

Last month in Lee County, under $100,000 there were 138 homes sold that were less than 5 years old. At that pace there is 9 months of inventory, while for homes older than 5 years old there are 12 months of inventory. This is a sale and a beauty contest all at the same time. The prettiest house at the best price goes first. In this case the newer homes that are value priced are the first to go.

Looking at Cape Coral there is 12 months of inventory for homes under $100,000. However, there is only six months of inventory for homes built in 2003 or newer. This puddle is drying up.

The opportunity to own a home less than 5 years old under $100,000 is limited. Homes under $150,000 will be the next to dry up. Most of these homes are below reproduction costs. The rain has stopped falling as the number of building permits being pulled has averaged less than 50 per month. There is now less than 14 months of inventory and only 12 months of inventory of homes built in 2003 or newer. New construction starts at $100,000 or just under with most builders. This typically does not include the home site, sewer, and/or water expenses. Buyers, the time to take advantage of the value is now.

This is not just true for the lower-priced homes. Homes in certain areas and at different price ranges are being recognized for the value they represent.

If you are a seller, the critical time is during the first few weeks. Ask yourselves "How many showings have I had?" If the answer is zero or a low number you need to act quickly and get your property priced to get noticed by the buyers that are out there.

There are still foreclosures that are flowing into our area like tributaries feed rivers. Foreclosures look to continue to add to our inventory levels and slow the drying-out process. The quicker this storm passes the faster our market will recover.

The media may paint a gloomy picture but you can still get sunburned on a cloudy day. So buyers, listen up: If you ever wanted to own a newer home the time is now. You better get those Ray-Bans on and start looking because the ground is beginning to show in a few areas. Remember it is better to buy one day early than one day too late.

As published in the News-Press