Laura Perryman\’s Blog

Check out this new Single-family property that I just posted on my Web site. It is at 3751 Maikai Dr in Pensacola. This Single-family property has 3 bedrooms and 2 baths.

Once in a while I will find something written with such clarity that it deserves to be disseminated to others “as is”. This article is one of those.   ~ Laura

 The following is reprinted,  including links,  with permission:

Renting versus owning is both an intellectual, financial decision and an emotional decision. The financial decision is first and foremost an analysis of the comparative cost of renting versus owning. It makes no sense to pay more than rental equivalence to own residential real estate. Many people still do because they are chasing the fantasy of endless appreciation and real estate wealth, but most of these people will find the increased cost of ownership over time negates any appreciation advantage they may obtain. Also, many people have found out painfully that property does not always appreciate in value.

The cost of a rental can be determined fairly easily as there are usually a number of comparable properties on the market to establish a realistic rental rate for any given property. Of course, it is easy to justify in one’s mind a comparative rent that is higher than the market will bear. A person who is “in love” with a house will almost certainly imagine it will command a rent amount that exceeds the reality of the market. It is probably a good idea to take 5% to 10% off comparable rental rates on properties offered on the market. Once a realistic comparative rental rate is established, and a realistic evaluation of the true costs of ownership as outlined above is complete, a simple comparison of the two figures will reveal if a property is overvalued, undervalued or at parity.

Some people expend a great deal of effort evaluating the costs of ownership to determine if it is a correct decision, but many people do not. Some people make the decision to purchase the most expensive asset they will ever own with no analysis at all. The decision to buy a house is primarily an emotional one. Even those who go through all the analysis generally only do so to provide rationalizations for their emotional decision. During price rallies, greed becomes a powerful emotion motivating people to fudge any financial analysis performed.

Another factor often called the “nesting instinct” causes both men and women to want a place to call their own, particularly when there are children in the family or on the way. There is nothing wrong with making decisions that are heavily influenced by emotions. Most people pick a spouse this way. The real challenge is to have the emotions and the intellect working together to make a decision that is both fiscally sound and emotionally satisfying. Of course, this is easier said than done.

The fundamental value of all housing prices is equivalent rents because rental is a direct proxy for ownership. Unfortunately, during the housing bubble, appraisers used comparative-sales prices to establish value rather than an approach using rental income. This allowed prices to detach from fundamental valuations due to irrational exuberance.

To determine the value of a property, one must evaluate the local rental market to establish comparable rental rates, and one must carefully evaluate the true, total cost of ownership. A potential buyer can determine the maximum amount that should be paid for a property by manipulating the loanand downpayment amounts so the monthly cost of ownership matches the cost of a rental. Of course, in the real world most people do not bother with this type of analysis, but then, in the real world, many people mistakenly overpay for residential real estate.

About the Author

Lawrence Roberts is the author of The Great Housing Bubble: Why Did House Prices Fall?

Check out this new Single-family property that I just posted on my Web site. It is at 8762 Kennedy Dr in Pensacola. This Single-family property has 4 bedrooms and 2 baths. Great location with easy access to NAS or Corry Field. This is a must see home! You will fall in love and want to make it yours! Click on the photograph for more pictures and virtual tour.

Check out this new Single-family property that I just posted on my Web site. It is at 3866 Bay Wind Dr in Gulf Breeze. This Single-family property has 3 bedrooms and 2 baths. Located in the Paradise Bay Subdivision, a very desirable area in Gulf Breeze, FL. This magnificent two story home has it all! Recent updates, and beautiful landscaping. This all brick Colonial style home boasts 9 foot ceilings, with crown moulding throughout, along with 3 huge bedrooms and 2 and 1/2 baths. There is a separate office/study area, as well as, a quaint breakfast room that overlooks the New Pool! You have got to come by and take a look at the professionally installed hand paved patio that wraps around the custom shaped pool. This home sits on one of the highest elevations in Gulf Breeze. Inside, you will enjoy entertaining friends or intimate time alone, as you listen to the recently installed surround sound system. This is one of the few lots in Paradise Bay that backs up to a no-build green belt. Do not let this one escape your list. Call for a showing today!.

I recently planted a small vegetable garden. Then came the squirrels!  Pensacola seems to have a bumper crop of those furry creatures this year, and keeping them out the garden was a full time job. I did my research and the simplest idea I came across was pepper and pepper sprays.  I didn™t get the results I planned, the first time I tried sprinkling pepper flakes in and around the garden. The next morning there were twice as many little squirrel holes and they had unearthed one of my tomato plants! The pepper seemed to have made them crazy with hole digging fever!  

Onto the pepper spray! I spent a great deal of time cutting up and boiling jalapeño peppers. I then strained and drained them. Once the water was cool, I added some tobasco and poured it into a spray container. Twice a day I was out there spraying down the garden area. It seemed to be slowing down the activity but they were still undermining my gardening efforts. I decided the only thing to do was to get a love trap. The love trap would capture them one by one and I could safely transport them to a wooded area far away from my garden. The idea was terribly daunting as there are at least twenty of the little buggers calling my yard home. So I procrastinated and continued with the pepper spray.  

One evening my husband was cooking dinner and discovered that the pre-packaged garlic we had just bought was very soft. I was getting ready to walk it to the compost bin when I changed my mind. I peeled and separated it at the garden™s edge and stuck each piece about ¼ inch into the bare areas of my garden. I was fairly sure it wouldn™t grow but what the heck.  The next morning I went out expecting to fill in the usual holes and rebury a tomato plant or two.   But much to my surprise¦.No Holes!

It has been just shy of a month now without pepper spray and the squirrels haven™t even been seen near the garden. Hmmmmm¦..it seems we have Vampire squirrels and the garlic did its job!   Garlic¦¦.$1.29      Vampire squirrels¦¦..priceless.  If they return, I will post it here.      

This coming Saturday and Sunday, June 28^th & 29^th, is the last weekend of the Pensacola Association of Realtors (PAR) Open House. From 1pm-4pm each day you will be able to take a peek inside some of the great properties that are currently on the market. You won™t need an appointment or a Realtor ®!

It will be next year before this number of homes will be open to the public, all at the same time, again! The PAR Open House is designed to be a Parade of Homes type of event. The difference between the open house weekend and the Parade of Homes is that most of these properties are not new construction.

Participating Realtors ®, throughout the greater Pensacola area, have chosen the homes they think would interest you most.  The variety of styles and price ranges will satisfy all preferences and budgets.Come by and take a tour of  some of the finest homes available. The following is a list of the properties my company, Real Estate Direct, will be showing. More information on these properties can be found on your internet information source, www.REDpensacola.com.  

There will also be a complete listing of homes in the Pensacola News Journal on Saturday, June 28^th.  Pick the ones you would like to see and map your course to an exciting weekend.  

Pace:                                                                                                                                                                                                                                                                                                                      

3431 Ashmore Lane “ Open Saturday and Sunday                                                                                                                                                                                                                                                                                               This four bedroom two bath home sits on a beautiful lot surrounded by trees and comes complete with a screened Florida room ready to hookup a hot tub.   This is a highly desirable neighborhood with quiet streets and Pace schools. Ask about the $5,000 allowance payable at closing.                                                                                                                                                                                                                                        

Gulf Breeze:                                                                                                                                                                                                                              

 3463 Willow Lane “ Open Saturday Only                                                                                                                                                                                                                                                                                                                     An exquisite three bedroom two bath residence at the end of a dead end street. This home includes a fireplace, formal dining room, and decorator ledges. The backyard is an oasis for kids and adults alike with a œkidscape and a cozy patio area. The newly remodeled kitchen is designed for the chef in you.

3866 Bay Wind Drive “ Open Saturday Only                                                                                                                                                                                                                                                                                                               An all brick, Colonial style, three bedroom 2.5 bath home is ready for you to tour. The beautiful landscaping and unique patio enhance the free form shape of the pool. A green belt flows directly behind, guaranteeing privacy and solitude. This is the most spectacular 2,230 sq. ft. property you will find in the beautiful Paradise
Bay subdivision.  

Pensacola Beach:                                                                                                                                                                                                                                                                                                                   5 Calle Juela “ Open Saturday and Sunday                                                                                                                                                                                                                                                                                                                           Brand new four bedroom, 3.5 bath, custom home built by Phillip Russell Homebuilders. Sitting on the tri-level deck system, it™s easy to spot dolphins frolicking in the Gulf. This island residence includes a fireplace, two master suites, and spectacular views you won™t find anywhere else. The beautiful beaches of theEmerald Coast are only steps away. Ask about the elevator allowance at closing.

I encourage you to visit any of the great homes open to the public this weekend. I™m sure you™ll enjoy looking for that dream home, retirement nest, or first time home ownership. Now is the time. The inventory has never been greater and the prices never as flexible as they are now. I look forward to meeting you!  

On June 28, 2008 at 13:00 PM, you are invited to an Open House at 5 Calle Juela in Pensacola Beach. If you are looking for a Single-family property in this area, don™t miss this rare opportunity to visit this magnificent property. For a preview of this Single-family property, check out my site at www.REDpensacola.com. Please do not hesitate to Contact Me if you have any questions or wish to schedule a private showing.

Market Conditions for the first four months of 2008 compared to the same period of 2007 in the Pensacola, Florida MLS area.  

Here are some numbers that may make you cringe:

Current monthly sales indicate an upward trend, which is typical for this time of year. However, compared to 2007, there have been 512 fewer sales in 2008.  The hardest hit, by far, is the $100,000 to $199,999 price range, with a staggering 248 fewer transactions. The next hardest hit is the $200,000 to $399,999 range, which accounts for another 171 less transaction. These two price ranges have a combined loss of 419 transactions or approximately 82% of the 512 sales lost year to date through April.  

Sellers with homes in the $600,000 plus price tier have fared slightly better compared to the same period last year. This price range has seen a net gain of 29 sales. It doesn™t sound like much until one considers that only ten sales closed in this range in 2007. Sales for the same period this year have almost tripled. The biggest gain was in the $950,000 to $999,999 range, with an increase of 20 transactions. Resistance at the higher price levels is evident. There were ZERO transactions on the MLS in 2007 and 2008 for properties priced at $1,400,000 to $1,850,000.    

The number of properties on the market in April has dropped from last year with 639 fewer homes. Considering an inventory of 7,132 residential properties for sale, this decrease in the number of listings seems negligible.  For those sellers in the hardest hit price ranges, take heart. Historically, most transactions in your price range will happen in the next three to four months.  

And for those ever elusive buyers, your options have never looked better!

Numbers  generated using data from the Pensacola MLS and are deemed reliable but not guaranteed

Want something fun to do while you are waiting for the phone to ring?

Pensacola, Florida is having one of the longest parties in history to celebrate having the longest history in North America. Did you know Pensacola was founded in 1559? That is six years before St. Augustine was founded. Spanish sailor Don Tristan de Luna arrived in Pensacola on August 15, 1559. Shortly after establishing the settlement, a hurricane destroyed supplies, eventually causing the Spanish to flee the area and not return until the 1600s.

To commemorate this 450th anniversary Celebrate Pensacola, Inc., a non-profit organization managing the celebration, is planning numerous special events and programs. The celebration will last 450 days starting May 23, 2008 and continue to August 15, 2009. The events include parades, art exhibits, heritage walks, historical reenactments, educational programs, a Spanish wine festival and possibly a visit from Spanish royalty. The 450th celebration will culminate on August 15, 2009 with a national birthday celebration. The kick off party is May 23, 2008 on Palafox Place at the Escambia County Courthouse fountain. Free hot dogs, Coca-Cola and music by the Pensacola Civic Band will be featured.

 Here are some of the events planned:

• July 10, 2008 – Spanish Orchestra œEvenings in Olde Seville”
• March 20, 2009 – A Night of One Voice
• April 4, 2009 – Spanish Wine Festival
• July 10, 2009 – Spanish Band
• August 15, 2009 – De Luna Landing Celebration

 Other Events with dates and times to be announced:

• Visit of Tall Ship Juan Sebastian de Elcano
• Heritage Festival Lecture Series and Archaeological Digs
• Historical Reenactments and Plays
• Proposed visit by Spanish Royalty

 Visit http://www.CelebratePensacola.com for more information.

And just in case you can’t find more to do,  we also have a lot of other events to occupy your time. Here are just a few:    

• June 5 – WUWF Radio Live in Museum of Commerce    
• April 21-September 27 –  Fiesta of Five Flags Celebration
• September 26, 27, and 28  - Pensacola Seafood Festival
• November 7,8, and 9 Greater Gulf Coast Arts Festival
• …and there is always the National Naval Aviation Museum at the Penscola Naval Air Station

Develop a budget. Instead of  projecting a budget for   what you expect to spend, use receipts to create a budget for what you actually spent over the last six months. One advantage to this approach is that it factors in unexpected expenses, such as car repairs, illnesses, etc., as well as predictable costs such as rent. You probably know how much you spend on rent and utilities, but little expenses add up. Try writing down everything you spend for one month. You™ll probably see some great ways to save.

Reduce your debt. Generally speaking, lenders look for a total debt load of no more than 36 percent of income. Since this figure includes your mortgage, which typically ranges between 25 percent and 28 percent of income, you need to get the rest of installment debt”car loans, student loans, revolving balances on credit cards”down to between 8 percent and 10 percent of your total income.

Save for your new home.. Although it™s possible to get a mortgage with only 5 percent down”or even less in some cases”you can get a better rate and a lower payment  if you put down more. Shoot for saving a 20 percent down payment.

Don™t just plan on saving whatever™s left toward a down payment. Instead decide on a certain amount a month you want to save, then put it away as you pay your monthly bills.   If you are getting 100% financing, having a new home savings account will allow you to make those changes and improvements to your new home.

Keep your job. While you don™t need to be in the same job forever to qualify, having a job for less than two years may mean you have to pay a higher interest rate. You may also want to consider a second job to pay down existing debt or to help in saving for your new home.

Establish a good credit history. Get a credit card and make payments by the due date. Do the same for all other bills. Pay off the entire balance promptly. See the Blog I posted on May 12^th, Give Yourself Credit, for more information on this topic.

Contact Me: Laura Perryman, Broker/Owner, Real Estate Direct

                                          www.REDpensacola.com

                                        850/525-2240     Email: superrealtor@hotmail.com

Some of the above information is reprinted from Realtor Magazine Online by permission from the National Association of Realtors.