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Florida Homeowners

AN INTRODUCTION TO EXPIRED LISTINGS IN SARASOTA COUNTY, FLORIDA

I am a Real Estate Broker with 20+ years experience in the industry. I am proficient in all areas of real estate and finance. I have lived and worked in Sarasota County for more than a decade. I am specifically targeting and talking to expired listings due to a recent study of the 2009-2010 residential real estate market here in Sarasota County. I have identified four major issues that would force your home to sit on the market without you ever realizing an effective sale and eventually cause your listing to expire over and over again with your realtor.
 

Many of our homeowners are suffering from more than one of these problems. If you are not aware of these issues and you do not take care of them, it is quite possible YOU WILL NEVER SELL YOUR HOME for your current and true market value, in the time frame that you desire or worse yet, in some cases, you may NEVER SELL YOUR FLORIDA HOME AT ALL.


Not only have I identified the following four HUGE problems, I have identified a solution for each and every one of them. Please read on and don’t miss reading about The Final Answer. 


THE FOUR PROBLEMS FACING HOMEOWNERS TODAY:

 

1.    There is a Disparity in Value Estimates on the internet within the top search engine sites for your property causing buyers to see and deem your home value drastically less than your list price or a mortgage payment drastically higher than the norm. (Zillow, Eppraisal, Trulia, Yahoo, AOL, Cyberhomes and Homegain give your property “their estimate of value” and make it available to the public online. These values can be as much as 90% lower than your list price. Listingvue and other sites place mortgage calculators on your home’s internet listing, reflecting zero down payment which results in the appearance of a huge monthly payment, negatively impacting a buyer’s purchasing decision)

2.    There is Overexposure on the internet causing a saturated market and the appearance that your home “has been” or “still is” on the market for an extended period of time. (sometimes years and with multiple and concurrent real estate firms and with listing agents that you may not even know)

3.    There is Underexposure on the internet disabling buyers from effectively ever finding your home for sale. (no ad placement, poor pictures, no tour, no property descriptions etc.)

4.    Or your home is Overpriced because it is Overleveraged due to the fueled up subprime debacle and the global economic collapse. (Believe it or not there are two solutions for this problem without requesting a short sale, read on if this is your situation)

 

THE IMMEDIATE SOLUTIONS TO THESE PROBLEMS:

 

1.    Clean up the internet by contacting every company that is posting erroneous information about the sale or value of the home and requesting the removal of such data immediately, by virtue of legal letterhead if necessary. (mandatory)

2.    Build up the home’s value where applicable and publically display any and all pictures, tours, details, improvements or amenities that will set the home apart from others on the market. (mandatory)

3.    Syndicate the home by using adjustable, personalized, single property web sites and use only top classified advertising sources that do not automatically adjust home values or use mortgage calculators that create monthly payments that are ridiculous and scare buyers away. Identify and mass market into a targeted homebuyer audience. (mandatory)

4.    Attract Buyer’s Attention by removing the price completely and placing the home on the “Highest and Best Offer” Virtual Auction Platform. This will create a buzz throughout the internet and bring in tremendous traffic in order to secure that emotional buyer that is ready, willing and able to pay the price and terms acceptable to you today and close on your scheduled date. These homes can be placed together on a multi property marketing platform and exposed to over 300 million people using social networking tools and an internet savvy technique that is unmatched by any other real estate firm. (optional, however a very effective program that I have been successful with in the past)  

 

 Let’s talk about these four problems and solutions and how they impact you. I would like to show you an example of what the biggest problem is today on the internet.

 

Disparity in Internet Values.

 

Property Located:                            Siesta Key Sarasota Fl. on Crescent Beach

MLS Listing Price:                           $5,450,000 M

Days On the Market:                        224

Expired:                                            July, 2009

Eppraisal Estimate of Value:         $985,555  (Low$837,721-High$1,133,388)

Zillow Estimate of Value:                $1,982M   (Low $1,564,920-High$1,974,640)

Trulia average sale for Zipcode:    $997,000

Trulia average list for Zipcode:      $977,000

Cyber Homes Estimated Value:    $757,350

AOL Estimated Value:                    $757,000

Listingvue Mortgage Payment:      $32,675 per month

 *This incredible, unique beach front home sits directly on Crescent Beach and is a rare find. Buyers have been known to pay as much as 4-5M for these homes in the past, but not when the values are posted so low all over the internet these days.

20 years ago there was a concept called “Appraising Residential Real Estate”. That was when a Licensed Certified Appraiser (a real human) had to physically go out to the subject property and perform an inspection in order for the lender to issue a loan to the buyer to consummate a sale. Once the inspection was complete, the Appraiser would carefully select comparable sales based on four criteria. 1. The most similar or like kind homes 2. The homes closest in proximity 3. The homes that closed most recent to the subject property and finally 4. The appraiser could only use sales that were a true “arms length transaction”, two parties not related that were not under duress to formulate a sale. “An arm's length sale refers to a real estate transaction in an open market freely arrived at by normal negotiations without undue pressure on either the buyer or seller".  If the sale is determined to be non-arm's length, it is then to be automatically excluded for percentage or ratio purposes.

As we are all aware, the real estate market has become flooded with various situations that are far from the norm, at least not since the great depression. These modern days we have computers running on a database software platform that do this appraisal work and report to the public what the “estimates of value” are based on their programmer’s computations and multi language conversions….that would be computer language, not English….that would be objective reporting not subjective reporting. I see very little, if any notation or computation of the fact that many of our sales are not of arms length these days and should not be legally allowed as use for comparables for other physically similar properties. Furthermore the thought of averaging the sales of an entire zip code and presenting it to the public as a potential bird’s eye view of true value in an area absolutely just makes me cringe. I believe this will further the debacle we are currently suffering from and cause great harm to many homeowners who live in higher priced subdivisions closely surrounded by average or lower priced communities.

Fortunately Zillow, being the Grandfather of the Zestimate has succeeded in allowing homeowners to claim their home, enter specific amenities and improvements to increase the value of the home and allows the homeowner to select the comparable sales in the neighborhood to properly determine the value. This was after Zillow’s   message boards were bombarded with threats of a class action law suit by angry sellers that could not sell because of this improper and less than due diligent reporting. Unfortunately,  Zillow is just one of many companies capitalizing on the cyber-techno-approach to doing business on the internet today. Studies show that 97% of buyers use the internet as a means to search for homes while determining demographics and pricing before contacting a realtor or a homeowner. With these staggering numbers I believe it becomes more imperative and prudent for the information that is shared to be accurate, complete and yet concise.

Trulia allows a realtor to place any and all information about the property for sale provided it is one of the realtor’s listings. Once the listing is removed, Trulia places their generic version of the average sales and list price information compiled by zip code. This is not good for the listings that are not entered into Trulia by the realtor or the homeowner during the time of sale. More than 90% of the time the zip code averages are drastically less than the true value or the list price of the subject property.

My experience with other companies like Eppraisal, AOL, Yahoo Real Estate, Cyberhomes and Homegain has been less than favorable. These values can range dramatically lower and sometimes higher than the list price of the subject property. Here nor there, under all circumstances that I have seen from these estimates listed on line, they are in direct conflict with the list price of the home and would most definitely deter a buyer from proceeding with the next step in the purchase of that home at that price.

The simplest way for you to see the damage that has been done is to place your home address in the search bar of these sites. Start with eppraisal.com; typically they list the estimates of value from Zillow, Cyberhomes as well as their own estimate of value. If you are experiencing shock, you are not alone. Most professionals are not even aware of this much less the homeowners who put their trust in us.

   If the internet de-value issue isn’t devastating enough for our homeowners today, there are other problems that are frequently overlooked and seldom noticed by real estate professionals. Overexposure on the internet has been coupled with many realtors placing other realtor’s MLS listings on their web sites and stating that they are the listing agent for the property. I have found some expired or withdrawn listings literally posted by more than 10 real estate firms at one time with all ten firms stating that they are the listing agent at different list prices. This poses a problem for the homeowner that wants to take their property down of the market, give it a rest and put it back on at a later date. In some cases, the fact is that your listing never left the market, so it has been on the market with multiple real estate firms concurrently, for months or sometimes years. The average buyer would say “what is wrong with that house”? Too much exposure for too long is not a good sales technique in the real estate business. The average homeowner hires a realtor and wants “that realtor” representing their home, not ten others that they do not know or do not have a relationship with. The average real estate market would appear to be saturated with too many active properties when and while this is happening. A saturated real estate market in itself causes a decline in pricing and an increase in the average number of days a property will sit in the market before an effective sale.

  On the other hand you have some homes that suffer from extreme Underexposure on the internet. It is obvious even though they are expired listings that they were never placed in any top classified or real estate search directories. Most of these homes have very little or no pictures, pictures that are unflattering, no virtual tour, no descriptions and no further call to action. Typically these homes have been listed with a realtor who is not internet savvy and needs to get ahead of the curve. Although this problem is fixable, these homes that have been poorly represented will now require additional days on the market and that shall be reflected in our percentages/stats and area information grids and graphs. 

 

 The fourth and final problem is the Overleveraged homeowner that places their home on the market at an overleveraged price perpetuating an unstable and saturated market. Trying to get more than your home is worth today is not a horrible thing and it happens quite often, however I do believe it needs to be handled a little differently than your average sale. The overleveraged home requires a very specific marketing plan. In this type of plan there is an expectance that your home will require a cash buyer who is ready, willing and able to pay the price and terms acceptable to you, or in this case more than the home is worth. I have found “The purchase of a home is typically emotional for buyers and when emotion gets involved, people with cash will spend more than the market value for what they want or need”. The key here is finding those cash buyers and that requires massive exposure, talent and technique.

 My success has been in creating a single property web site (blog) that is virtually stunning, loaded with 25-40 still shots of the home, virtual tour, descriptive articles, expense details, community information, maps, seller’s disclosure and a high quality home inspection report showing the home in good repair. The home is then marketed as “highest and best offer” versus placing a price tag that might frighten the average buyer. The web site or blog is then dated for the first of the month and an article is written and placed on the site in reference to the seller entertaining all offers for a period of 30 days in order to obtain the “highest and best offer”. Once this is completed, the single property web site or blog is syndicated throughout the internet so hundreds of thousands of people can see. This is a virtual high bid auction that runs for a period of 30 days. The technique here is to expose the overleveraged home to a massive audience, without a price tag (or erroneous internet values) and on a timed deadline for offer acceptance. What you will receive is a very high number of people that might want to see if they can get a deal, this is true. However, through the power of numbers you may find that one right buyer, who absolutely falls in love with your home and will pay any price to get it. I just had a situation where as a buyer NEEDED (operative word) to live in Nokomis, Fl.. They HAD TO HAVE (operative words here) more than 4,000 square feet and HAD TO move in before school started for the kids. There were no other homes in their specific desired location that met those criteria, except for my overleveraged listing…which they fell in love with, purchased and paid more than 200,000 over appraised value. So yes, this is an incredible technique and valid solution that has worked (for many people I am sure) in the past. However, it has to be done right with extreme attention to detail.

If we are unable to secure an offer that is acceptable to you, we can adjust the article on the blog or site and run another virtual high bid auction for a period of 30 more days. People need to see that they have only a limited amount of time to place an offer; it creates a sense of urgency. This is part of the technique here in order to expedite a buyer’s decision to purchase your home versus another. At this point it is highly effective for me to place every single property web site on one combined platform and market into a targeted massive audience as “Beautiful Stunning Florida Homes” “Highest and Best Offer” Virtual Real estate Auction. This type of marketing gets an amazing amount of exposure and more importantly, attention from serious cash buyers across the country. What I have learned is that every home has its buyer; it is just a matter of exposing or syndicating the property so the quantity of buyers can be turned into the quality of one happy, cash qualified buyer.

Once this protocol is professionally carried out and we are still unable to procure  a     buyer who is ready, willing and able to pay you more for your home, than it is worth we need to pull out the BIG GUNS. This would be the Final Answer. 

 

 THE FINAL ANSWER:
 

In the end, most of these problems are fixable with the help of a trained professional. However there are many more problems occurring and coming our way that will have a constant impact on our home values and I believe we need to be working towards other solutions. Over the last two years I have been developing a genuine home auction software application that would ensure every homeowner would be able to get out of their home without taking a loss and home ownership would be affordable again for buyers. Please take the time to read this brief summary below as I intend to launch this program in 2010 and help as many Florida homeowners along the way. 

The Unique Bid Home Auction Program

Premiers 2010

 

We are launching a “Reserve Seat, Lowest Unique Bid Auction” program for the Real Estate Industry. This program will accomplish multiple goals:

1.    Help homeowners out of overleveraged properties.

2.    Liquidate other re-sale and builder inventories currently saturating our market.

3.    Eliminate the need for short sales and foreclosures.

4.    Allow homebuyer’s the ability to own a home free and clear of a mortgage under $500.

5.    Reimburse the lenders/creditors, in full for outstanding notes on mortgages and other debt.

6.    Increase property value for existing homeowners by removing inventory from the market.

7.    Improve the environment by encouraging “eco- friendly” homes.

8.    Remove Inventory in the Auto/Boat/Furniture Markets.

9.    Create jobs and income for many industries across the country.

10. Increase revenue for local, state and federal governments.

11. Provide an economic stimulus on a grass roots level for the USA and other Countries.

The lowest unique bid auction format is a dynamic program that provides the Seller an opportunity to generate more income from the sale of their home and a Buyer an opportunity to own a home they otherwise could not afford. Homes are listed online in an “upcoming auction” status and displayed with a virtual tour, 25 still shots, survey, pest inspection, title, home inspection, appraisal, seller’s disclosure, community information, expense details and contract for purchase. Buyers can tag a home they would be interested in purchasing. Once a home has a pre-determined number of tags (example 10K) the home is moved into “current open auction” status. At this time the buyers can purchase a seat for the auction at a pre- determined price (example $100). Once the pre-determined numbers of seats are sold (example 10K), the auction closes to the public and goes into a “pending live status”. In this case we would have collected $1M in seat reserve fees therefore the property can be purchased from the seller at the higher value and all liens paid off.

Because the home is free and clear now, we can proceed with the Low Unique Bid Auction format versus a High Bid Auction format.

The bidders that have purchased seats are then notified of the date and time of the auction. Once the auction goes “live”, those bidders can bid within a pre-determined low bid range (example from one penny to five hundred dollars) for 30 minutes. Bids are placed in one penny increments, entered online through the member’s live bidding panel on the member’s home page and are sealed to the public. The criteria to be the successful bidder in this auction format are to have placed the “lowest bid” that is “unique” or unmatched by any other bidder at the close of the auction. So if a member places a bid for one penny, and another member does the same, the bid amount would be the lowest, but no longer “unique” within the auction. The member is constantly updated on the status of their bid as the auction progresses. This auction requires a very strategic approach to be the successful bidder. Upon the close of the auction the “lowest unique bid” amount becomes the sale price of the home (example $2.22).

Once again, the fees collected for the reserve seats, pay for the cost of the home and the service provided. All closing costs are paid by Marcus Real Estate and taxes, insurance, pest care, pool care, lawn care and home warranty are paid for the first year for the new homeowner. Each home will be equipped with a “green package” valued at $5,000.00; and for a seat value of $10 more, a new car is placed in the driveway, a boat in the dock and a selection of three different furniture packages to choose from.

The benefit to this genuine auction format is that there is no “winning tax” applied at the closing. The new homeowner would be responsible to the IRS for capital gains “only when they sell the home and realize the gain”. 

Remember, once the seat reserve is met, all homes listed in this program are then purchased outright for “the mortgage, the appraised value or what the owner originally paid for the home, whichever is HIGHER”.  Seller’s closing costs can be included, if needed. All homes are then auctioned to the Lowest Unique Bidder and sold “Free and Clear of all Liens” under $500.

I believe this is truly the Final Answer and furthermore this type of auction format is already being applied to the real estate industry successfully in other Countries across the Globe.

My motto and my intent with this program is…. “Let’s Live Debt Free America”.

As I said I have been working behind the scenes for two years on this program. Our beta prototype is complete and we have run 30 successful mock auctions whereas the last $500K home sold for $.36. We are currently enhancing the program for statewide expansion and look forward to a 2010 public launch of this software application. I hope you can join me, I think we will have a blast.

So that wraps things up here Ladies and Gentlemen. Thank you for taking the time to read this information. If you would like to get started with me as your listing Broker please contact me by cell or by email.

If you would like to see examples of my work or follow me under construction and through several auctions please visit Blogs and Sites.If you have read all of this information and would like to get started I am excited to speak with you directly.

*Variable rate commissions and/or service fees do apply.



Thank you and Have a Great Day,

Maureen E. Marcus

Marcus Real Estate, Inc.
Licensed Real Estate Broker
Sarasota, Florida 34233
Cell 941.445.2661
Fax 941.922.047
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