Why You Should Hire an Agent

Here’s why you need to hire an agent, even in a hot market like this one.

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You need to hire a great real estate agent, especially in a market like the one we’re in right now. People make the mistake of thinking that since the real estate market’s hot, they don’t need to hire an agent. Then they miss out on advertising opportunities, syndication to all the essential websites, they don’t have photos taken at the right angles, the property description isn’t written correctly, and more. I’ve sold thousands of homes and have put a team together that’s sold thousands of homes, so I’ve figured out tips and tricks over time that put more money in your pocket. 

The National Association of Realtors comes out with a study every year that compares and contrasts what the average home sells for without a Realtor and with one. Historically, selling your home with the average agent can increase your net price between 7% and 11%. That’s just an average Realtor; I believe if you sell with one of the best in the market, they can outperform that. You may think you’re losing money by paying commission, but in reality, you’re often getting a lower price. 

You don’t know how to negotiate inspection repairs, create a frenzy of interest for your house before it even hits the market, or have professional tools at your disposal. You don’t know the tactics agents use when they’ve negotiated hundreds of deals.

      Agents offer you a safer alternative to avoid the pitfalls that can cause you to get pulled into a lawsuit.

You often hear Realtors say something like, “I’ve been an agent for 20 years” to reference how much experience they have. However, that’s irrelevant because how long someone does something is not proportional to their skill level. They could have been doing their job poorly for the last 20 years. 

Instead, you want to hire someone who does plenty of deals. We learn quite a bit when doing deals, such as how to structure things, what copy works in contracts, what photo angles work best, what to mention about the neighborhood in the home’s description to help accentuate it, and how to have the patience to let offers come in and get the best price and terms for our clients. Realtors also know how to navigate through the legal obstacles that can pop up when selling. We live in a very litigious society, and agents offer you a safer alternative to avoid the pitfalls that can cause you to get pulled into a lawsuit due to your lack of experience. 

So if you’re considering selling your home without a Realtor, yes, you can do it. However, you won’t save money; you’ll leave money on the table because you don’t have all the things an agent can bring to the transaction, and you may even get into legal trouble.

If you’re still thinking about selling on your own, good luck. If you’d rather hire the best agent in the marketplace, check us out on our website or give us a call. We’d love to apply for the opportunity to get your home sold.

Your Tampa Area Real Estate Market Update

Here’s what the latest numbers say about our real estate market.

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The June numbers are in for our real estate market, so today we’ll be going over the changes we’re seeing and what they mean for you.

There have been rumors going around that the market is softening, but here’s what the statistics say. We had 0.7 months’ worth of inventory, meaning it’d only take three weeks for all the current homes to sell if no other ones came on the market. During this time last year, we had around 6,700 active listings; now, that number has dropped to a mere 2,641.

      If these statistics are any indicator, our market is definitely not softening.

On average, homes are spending 23 days on the market before going under contract—many are going much quicker, however. The average sales price is around $375,863; last year, it was around $322,000. That’s a 17% increase in just one year. Additionally, 3,979 homes sold in June, which is the most monthly sales we’ve seen since July 2020. The sale-to-list-price ratio is currently 101% meaning everything is selling for above asking price. That’s never happened in Tampa before.

If these statistics are any indicator, our market is definitely not softening—in fact, it’s looking like it’ll stay incredibly strong throughout the rest of 2021. If you’re a buyer, go into the market expecting to pay above asking price. If you’re a seller, find an agent who can get your home sold for above and beyond your list price. 

If you have any questions about our market or would like more information, feel free to reach out to me anytime. I look forward to hearing from you soon.

Why the Housing Market Won’t Crash

Is our market headed for a crash?

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Many people have been speculating that because of our market’s 21% growth in home prices in the last year, we’re repeating a similar cycle that we went through over a decade ago during the last housing crash. People who have bought into conspiracy theories fear that prices are going to plummet, there will be a wave of foreclosures, and the economy will crash. Today, however, we’re here to talk to you about the facts.

We can tell you unequivocally that our market isn’t about to crash anytime soon. Nothing that is happening in our current market mirrors what was going on back then.

One factor that contributed to the crash of 2007 to 2008 was that almost anyone who applied could get a loan, and not just one loan, but multiple loans that many people weren’t able to pay off. Since then, the mortgage industry has tightened up; there are more hoops to jump through if you want to get a loan today. Now they know to make sure that applicants are able to qualify for a loan before they’ll issue one.

      The circumstances surrounding today’s market are vastly different than we experienced back then.

Simple processes that we take for granted today, like appraisals, weren’t required back during the crash. Today, appraisals are taken more seriously. Even though the market has appreciated, we in the industry are still dealing with many appraisal challenges.

The biggest deciding factor that caused the crash was an overabundance of homes in the market. We had too many homes and not enough buyers. Today, as I’m sure you’re aware by now, we have the opposite problem—there aren’t enough homes on the market to meet the buyer demand. Right now, we have one month’s supply of homes, and each house that we list in the regular price ranges is receiving upwards of 10 offers. Not only that, but these buyers are owner-occupiers, not investors, meaning that they’re buying homes to live in. During the crash, many investors were buying up properties for speculative purposes.

The only thing that seems like it would be capable of slowing our market down would be an increase in interest rates. That would slow demand, but it wouldn’t cause home prices to plummet.

All in all, don’t believe the conspiracy theories about the market heading for a crash. The circumstances surrounding today’s market are vastly different than we experienced back then. 

If you have any questions about the market or real estate in general, don’t hesitate to reach out to us. We’d love to speak with you.

This Market Requires an Experienced Professional

Here are the benefits of choosing an experienced agent.

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Great real estate agents understand how to negotiate and market homes, and they also know how to take advantage of a heated market like ours. Even though it’s now commonplace today, we’ve been generating bidding wars and selling homes for above asking price for over a decade. Our agents come from a place of abundance; they’re doing a ton of transactions and are well-compensated for it; they’ll never try moving things along just so that they can get a check. 

Being a buyer’s agent in this market is especially tough. It takes a lot of experience and effort to be able to secure a home for a buyer at all, given how low inventory has been. A good buyer’s agent needs to know how to navigate multiple-offer situations, and unfortunately, many newer agents don’t know how to do it.

Be sure to compare and contrast your options for agents when seeking professional assistance. Don’t just work with your friend or family member because they’re there or you feel obligated—no matter how close to them you are, if they don’t have the right skill set, they may end up costing you by leaving money on the table or failing to negotiate the best deal.

      Now is not the time to hire an inexperienced agent.

No matter if you’re buying or selling, if you’re planning to act in this market, you’ll need an experienced professional who has the power of a team behind them. Transactions today are more complicated than they used to be, so it’s invaluable to be able to take advantage of multiple specialists to help yours move along swiftly and smoothly.

Because we have such a large team, we’re able to collaborate in order to find properties that aren’t even on the market yet, as well as create strategies to secure properties for buyers and the best prices for sellers. We also have access to professional marketing resources like photography and videography, which can boost the appeal of a seller’s listing. Brand-new agents likely can’t afford the latest technology and tools to get you the best results.

If you’ve been thinking about buying or selling a home, reach out to the Duncan Duo Team at RE/MAX. We’d be happy to speak in more detail about how our combined experience can help you find success no matter what you’re looking to do.

Why Selling Now Is a Great Idea

Now is the perfect time for you to sell your Tampa home. Here’s why.

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We’re still in one of the hottest real estate markets we’ve ever seen, and it’s created a lot of unique situations for buyers and sellers alike. In particular, there are many opportunities for sellers to make a fantastic profit.

Few people expected that the pandemic would cause such an influx of homebuyers in Florida. People who would normally leave the state have chosen to stay instead, so supply and demand are heavily favoring the sellers. Additionally, record-low interest rates have continued.

We have less than a month of inventory in many of our markets, so a lot of bidding wars are taking place and netting sellers top dollar on their sales. Really, there’s never been a better time for sellers to jump into real estate. Additionally, sellers haven’t needed to do the upgrades and renovations they normally would in the past. You can still get offers above asking price when you sell your home as is, which nets you an even bigger profit. Home prices have also appreciated 21% year over year.

      If you’re on the fence or waiting to sell, we recommend that you jump into the market sooner rather than later.

However, new laws may take effect next year that affect capital gains taxes. For example, people can currently avoid paying a capital gains tax if they live in their property for two of the last five years. There are talks of ending this within the next year, which is another reason why now is a good time to sell.

If you’re on the fence or waiting to sell, we recommend that you jump into the market sooner rather than later. A lot of things are likely to change in the near future, and these changes can cause you to miss out on great profits in your home sale. If you have any questions, would like more information, or are ready to sell your home, feel free to reach out to us. We look forward to hearing from you soon.

Why Our Market Is More Stable Than You Think

Here are four reasons why we’re not in a market bubble that’s soon to burst.

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As we head into the second quarter of 2021, there’s a lot of fear out there regarding the real estate market. People see that prices are continuing to rise and they’re concerned—understandably so—about the potential for a bubble in the market leading to a crash. Will we see a collapse like we saw a decade ago? Are prices about to fall? The answer to all of these questions is unequivocally no; we are not in the midst of a bubble, and a crash isn’t on the horizon. Here’s why: 

1. Limited supply. Leading up to the ‘08 crash, we had an abundance of homes on the market, and not many people were actually interested in buying them. Builders ramped up production and greatly outpaced natural demand. Currently, we have fewer than two months of inventory across most neighborhoods and price ranges in Tampa Bay, meaning that there’s more demand than supply; prices will rise organically. Our market isn’t unstable or unnatural—it’s being fueled by basic economic principles. We can’t say the same for the manipulated market that existed between 2005 and 2008. That leads me to my next point… 

2. The housing demand is real. We don’t have all the faulty and fake loans out there. Nowadays, it’s much harder to qualify for a loan; you have to send in more documents to verify more components of your financial profile before receiving approval.

      In the early to mid-2000s, Americans were using their houses like ATMs.

3. Households in 2021 have plenty of equity. In the early to mid-2000s, Americans were using their houses like ATMs. There was almost an economic assumption that equity exists solely to help you buy things like a new car or splurge on a fun vacation. This type of thinking left many vulnerable to a market correction. Today’s homeowners are not overextending themselves; they’re using their equity more judiciously. If you look at the stats, you’ll see that the majority of homeowners today are in much, much stronger equity positions than homeowners last decade. 

4. Real estate is hyperlocal. What happens in one market doesn’t necessarily indicate what will happen in another. Here in Tampa Bay, we have several factors that will help keep our market hot for the foreseeable future. First, there's the population growth; more people are moving here than are moving away. Our builders are still lagging behind demand! Fewer people are selling their homes (though I think that that’s a mistake, considering they might get hit with an unpleasant new tax bill soon).

Additionally, we have low taxes and fantastic weather. Last but not least, we have winning sports teams! We won the Stanley Cup and the Super Bowl, and our MLB team contended in last year’s World Series.

So there you have it—four reasons why you should put your market bubble fears to bed. Hopefully this helped put things into perspective. As always, reach out by phone or email if you have questions about this or any other real estate topic. I’m here to help, and it’d be my pleasure to have a more in-depth conversation with you.

Possible Capital Gains Tax Changes in 2021

Here’s how potential capital gains tax changes impact homeowners.

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Potential tax law changes on the horizon could impact home sellers’ capital gains rates and exclusions. Currently, sellers are allowed to sell their primary residence and not pay the capital gains tax if they’ve lived in that residence for at least two out of the past five years. Married couples can exclude up to $500,000 worth of capital gains, while single homeowners can exclude up to $250,000.

Due to the run-up of our real estate market, many homeowners out there are sitting on a lot of equity. If they wait until next year or any year afterward to sell their properties, they could pay an enormous amount of capital gains. For our team’s savvy home sellers who don’t want to miss out on taking advantage of home appreciation, we recommend that they sell now, collect their capital gains tax-free, and buy a comparatively priced home in the same area or market. If you’re in the same situation, this simple lateral move protects you from the coming tax basis. 

Similarly, investors and landlords who own lots of properties could be looking to sell them because it’s a lock that capital gains rates are rising. If you’re an investor or landlord, you can look at this as an opportunity to take a greater gain as well. Of course, you can always buy back properties and take part in the appreciation that’s expected to happen in the next few years.

      This simple lateral move protects you from the coming tax basis.

However, because these tax changes haven’t been formally announced yet, people are waiting to see what happens. The problem here is that if you wait too long, you may not be able to sell your property within the same year. It’s not just about when you list your property—it’s about when you close on it. If you wait too long to list and your property closes next year, you won’t get the same benefit. 

Many of our smart, wealthy clients who own primary residences worth $500,000 to $1 million and have $200,000 to $500,000 worth of equity are selling now and buying comparable properties for this very reason. They also plan on staying in their new properties until the tax laws swing back the other way. If you’re afraid that home prices will keep rising, they may do so in the coming year, but that rise gets offset by what you’d have to pay in capital gains if you wait to sell. 

The longer you wait, the more you put yourself at risk, and there’s never been a better time to sell real estate in Tampa Bay. Inventory is low, we’re seeing high population growth, and there are tons of strong economic indicators. We’re seeing bidding wars across all price ranges and homes selling far above asking price, so talk to an agent and review your options. We’d be happy to give you a free consultation or determine what your home would sell for in this market, so give us a call or shoot us an email today. 

If you have any other real estate needs, feel free to reach out to us as well. Also, be sure to check out our weekly radio show every Sunday at 10 a.m. on 970 AM. We look forward to hearing from you!

5 Major Home-Buying Mistakes

If you’re buying a home, avoid making these five disastrous mistakes.

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There are five fatal mistakes that too many homebuyers make during the home-buying process:

1. Hiring an inexperienced agent. This includes hiring people like your close friends and family because you’d feel guilty if you didn’t. Many people work in real estate part time and unfortunately can't always provide the resources, tools, and experience needed to help you navigate to a successful closing. Hiring an inexperienced agent to help you could cost you tens of thousands of dollars, a lot of heartache, and cause you to make further mistakes in the transaction. More experienced agents do more transactions, have more experience, and can therefore help you get to the closing table.

2. Failing to get a home inspection. Home inspectors are trained to find things that are wrong with a house. Like when they hire agents, many people look to their friends and family to help, only to find out months after the transaction that something had been missed or poorly assessed. Hiring a professional home inspector is a must in every real estate transaction.

      Don’t go out and make major credit purchases until after you close on the home.

3. Changing jobs. Any change in your job environment during a home purchase can cause issues with your mortgage. It doesn’t matter if you’ll make more money at your new job; it’s a risk the bank doesn’t want to take. Keep your job during the process, and be sure to document any bonuses you receive. 

4. Making credit purchases. We’ve helped countless people who, after qualifying for a home, have gone out and purchased new furniture at 0% interest. That throws their debt-to-income ratio out of whack, and they’ll find that they can’t qualify with their lender to buy the home. Don’t go out and make major credit purchases until after you close on the home.

5. Choosing the cheapest insurance. Far too many people buy the cheapest insurance policies they can, pass on flood insurance, or fail to get the proper coverage for certain elements of the home. Later when they have a claim, their claim is denied, meaning that they’re out potentially tens of thousands of dollars all because they didn’t want to pay an extra $100 a month for good coverage. Shop around for insurance before you pick one because buying the cheapest insurance is a recipe for disaster.

If you have any questions about what it takes to successfully buy a home in our current market, don’t hesitate to reach out to us. We’d love to help you.

Key Tips for First-Time Investors

Here are a few things to consider before buying your first investment property.

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Which tips do you need to remember to start off on the right foot as a first-time home investor?

First, you’ll notice that I say “home investor” instead of “homebuyer” because I don’t think you should own your first investment property before you own your first home. Therein lies my first tip. Owning your own home before buying an investment property can teach you a lot about what can go wrong, how to fix things, what you are (and are not) capable of doing yourself, etc. Don’t put the cart before the horse and start buying up investment properties while you’re still paying someone else’s rent. 

Next, start small. Far too many people try hitting a home run with their first real estate investment and end up striking out. Continuing with our baseball parlance, just try hitting a single. Get a rental property you can manage yourself so you can learn how to screen tenants and identify ways you can increase rent. It’s a low-risk, high-reward opportunity. If you screw things up, you can probably correct the situation without it costing you too much. Additionally, the property can appreciate greatly over time and give you ample tax benefits.

      Once you buy your first rental property, you have to treat it like a business.

As time goes on, you can branch off into buying multifamily properties, commercial properties, more individual units, or start flipping homes. First, though, start small and build from there. Being a real estate investor is, in essence, its own separate business. As you gain more skills, you can grow your portfolio. 

Last but not least, hire a team of professionals. You need a team of property managers, real estate professionals, and contractors you trust to help you. Before buying any rental properties, you need to know who’ll be working on them, managing them (if you’re not), and offering you legal advice so you can successfully run your real estate investment business. Again, once you buy your first rental property, you have to treat it like a business. You have to give it its proper due by ensuring it’s properly managed by a group of professionals. 

If you’d like to know more about buying your first investment property or have any real estate needs I can assist you with, don’t hesitate to reach out to me. I’d love to hear from you.

How Do Politics Impact Real Estate?

Taxes are just one way that politics can affect the real estate market.

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Every time there has been an administration change from Republicans to Democrats, there has been a fear that the tax laws allowing home sellers who have lived in their primary residence for at least two of the last five years to sell their homes without capital gains tax would be stripped. That law has been on the books for a long time, except for the part about married couples with a net worth of $500,000 or more or single people with $250,000 or more. If the law does go away, you could potentially pay some portion of those capital gains taxes. That has caused many homeowners to become proactive by listing their homes ahead of that possibility.

      With so many people moving to the area, you won’t have any issues selling your home quickly.

Of course, we don’t know if a change in law like that would apply retroactively; there’s so much uncertainty around the topic at the moment. However, if you’ve been thinking about selling your home, you may want to consider doing so sooner rather than later for the benefit of avoiding capital gains taxes. I’m no CPA, and everyone’s tax situation is different, so make sure you talk to a professional about your circumstances so you can make the best decision moving forward. Frankly, our Tampa Bay market currently has too few homes available for the level of demand we’re seeing, so we could use your listing. With so many people moving to the area, you won’t have any issues selling your home quickly and for more money.

So for anyone who has been toying with the idea of selling, don’t hesitate to reach out to us with any questions you have. We’re here to help you.

Q: How Does Realtor Safety Impact Buyers & Sellers?

Here’s how Realtor safety impacts your buying or selling plans.

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Recently, a real estate agent in Nebraska was murdered during a home showing. A lot of our customers typically don’t see this type of news because it’s usually disseminated mainly among us agents, but attacks on real estate agents is an epidemic that’s been happening for a while now. Accordingly, we’ve taken steps to provide more safety for ourselves. 

Whether you’re a buyer or seller, this means you should expect agents to want to verify more information from you before scheduling an appointment. They may want to see a copy of your driver’s license or prefer not to meet you late at night at a vacant home. They also may want to make sure you’re qualified to buy a home before meeting with you. Statistics show that if someone is willing to give their credit information to qualify for a loan, they’re much less likely to be a serial killer.

      We’ve taken steps to provide more safety for ourselves.

What happens to the real estate market? People who’ve been buying and selling homes for a long time are used to agents popping up and showing them homes whenever they want. Now that we’ve been forced to be more cautious, though, don’t take it personally if we need to ensure our safety before meeting with you. No home sale is worth risking your life over, so if you’re not willing to give an agent enough information that makes them comfortable meeting with you, you should plan on not being approved for an appointment or showing. Frankly, if you’re unwilling to provide some basic information to an agent or are defensive about doing so, they may become suspicious of you. 

So plan on working with your agent and the real estate industry at large to provide enough information about yourself to make them feel safe. I promise you that we’re not the only real estate company taking proactive steps to prevent any future attacks. This initiative may change the industry a little bit and slightly inconvenience you, but you’re coordinating one of the most substantial transactions of your life when buying or selling a home, so if you’re legitimate, you’ll have to provide this information anyway. You might as well provide it up front so your agent isn’t looking over their shoulder and can give you the right advice.

As always, if you have questions about this or any real estate topic, don’t hesitate to reach out to the Duncan Duo. We’d love to help you.