What's happening in Spanish Fort, Daphne, Fairhope

Janet English named No. 2 agent at RE/MAX By The Bay

Based on sales numbers, Janet English earned the No. 2 spot at RE/MAX By The Bay, which has offices in Daphne and Fairhope, Ala.

Janet English, top agent at RE/MAX By The Bay

English, who left print journalism to start her real estate career in 1998, is a perennial in the Top 10 at this brokerage. In 2009, she earned induction into the RE/MAX Hall of Fame.

"I love what I do," she said. "I've met so many friends and hope to continue to help folks get to their next destination."

 

New subdivisions in the works

January, 2019

 

Twenty years later, Spanish Fort home prices have risen 86%; Fairhope, 103%. (I can’t give you Daphne’s since along the way, Lake Forest was folded into the statistical mix).

 

I have these pricing figures stored in a stack of newsletters that I’ve been sending to neighbors for the last couple of decades, since I started helping buyers and sellers get to their next destination. The changes over time are truly remarkable.

 

In 2018, the average sales price for homes on the Eastern Shore, as a whole, reached $307,167, compared to $289,198 in 2017. That marked a 6.2% increase, topping the 6% jump the previous year.

 

New home construction accounted for 30% of 2018 sales, representing a whopping $206 million worth of property value.

 

 

 

The new construction isn’t likely to slow down any time soon. For example:

 

n  Lots of dirt and dump trucks in the Belforest area of Daphne herald the start of DR Horton’s 900-home Jubilee Plantation project.

 

n  The Bellewood subdivision on County Road 64 on the far eastern edge of what’s considered Daphne has been given a new lease on life after it was purchased by Breland Homes in late 2018.

 

n  A huge new multi-phase development could be on the way to Jimmy Faulkner Drive outside Spanish Fort’s city limits. I was part of a focus group in late 2018 that was asked what amenities should be included in a “Crystal Lagoon” that will be the main attraction in the giant project. Check out the video of a similar lagoon in Florida: https://www.youtube.com/watch?v=NusOclUZcAw

 

It’s worth your time to see it.

 

Meanwhile, older neighborhoods are rocking along, too. Housing is moving quickly once the “For Sale” signs go up. For example:

 

n  Sprawling Lake Forest has only 28 active listings, and 20 properties under contract, as of this writing in January 2019.

 

n  The large Spanish Fort Estates has a mere 4 active listings, and 7 properties under contract.

 

 

 

 

 

 

 

 In the words of Huey Lewis and the News: “The future’s so bright, I gotta wear shades.”

 

But before then, let’s take a look back at 2018. Here’s some of the key sales data for our local area’s specific markets, both for the year as a whole, and for the final quarter of the year.

 

 

 

Eastern Shore overall: In all of 2018, 2,165 homes with an average price of $307,167 sold compared to 2,109 homes with an average price of $289,307 in 2017. Days-on-market dropped to 50 days in 2018, although the formula for deriving that figure was tweaked by the Board of Realtors to represent the time from listing to contract rather than listing to closing. In 2017, it was 127 days. Sellers trimmed 2.7% off their list prices in order to sell, the same as in 2017.

 

In the 4th quarter, 447 homes sold on the Eastern Shore, compared with 424 in the 4th quarter of 2017. Average sales price dipped to $302,586 from $313,289. But the list-to-sale percentage improved to 3.3% from 3.8%, while days-on-market went to 54 from 99.

 

Spanish Fort: (This 36527 Zip Code includes some areas in Daphne and Loxley) 477 homes sold in 2018 with an average price of $295,183, up from 438 sales with an average price of $279,440 a year earlier. Sellers took 3% off list price in order to sell; a year earlier, they trimmed the list price only 1.9%. Days-on-market dropped from 146 in 2017 to 61 days in 2018.

 

In the 4th quarter, 97 homes sold with an average price of $291,440. That was up from 81 sales with an average price of $287,681 in the 4th quarter of 2017. Sellers took 2.8% off list in order to sell, while a year prior they took off 1.8%. Days-on-market went from 101 to 67.

 

Daphne: 873 homes sold in 2018 compared to 827 homes in 2017. Average sales price rose from $240,430 to $249,884. List-to-sale percentage was little changed from 2.2% in 2017 to 2.1% in 2018. The “Wow!” number was the drop in the time needed to sell: 47 days, compared to 124 days in 2017.

 

In the 4th quarter, Daphne enjoyed 171 sales, a jump from 157 in the same period of 2017; average sales price stood at $246,012, down from $261,695. In 2017, sellers settled for 3.7% less in order to close; that number dropped to 2.4% in 2018. Days-on-market was again a “Wow!” – It dropped from 111 days to 41.

 

Fairhope: (This municipality enacted a 9-month building moratorium for certain new construction that ended in September 2017). 815 homes sold in 2018, a decline from the 844 sales in 2017. But sales price rose from $367,992 in 2017 to $375,540 in 2018. In 2017, sellers took 3.4% off list in order to sell; in 2018, they took 3.7%. Days-on-market dropped from 119 to 48 days.

 

In the 4th quarter, 179 homes sold in Fairhope, compared to 186 in the same quarter in 2017. The average sales price also ticked down slightly: from $367,992 to $362,671. But sellers didn’t trim as much off their list prices in order to sell as a year earlier: 4% vs. 4.4% Days-on-market dropped from 89 to 56 days.

 

 

 

Homes prices continue upward march

October, 2018

 

Another stellar quarter for home sales on the Eastern Shore with prices up 7.3% compared to this time last year.  

 

  The number of single-family homes sold rose 10.6% in Spanish Fort, Daphne and Fairhope compared to the 3rd quarter of 2017.  

 

  The cheapest home sold was a cute 480-square-foot cottage in Fairhope that sold for $62,500; the most expensive, a 4,333-square-foot bay front home, also in Fairhope, that went for $2,325,000. The latter was one of six $1 million-plus sales in Fairhope in the 3rd quarter of 2018.  

 

  Before we get to the numbers: The Baldwin County Association of Realtors’ multiple listing service website has changed the way days on market (DOM) are calculated. Previously, this numbers started the day the property was listed and ended the day it was closed. Now, it freezes upon accepted offer time when the property is put in as a pending sale.  

 

  However, the time it takes to sell -- start to finish -- is shrinking.

 

On to the numbers;

 

  Eastern Shore: 594 single-family homes sold, with an average price of $300,778. In the 3rd quarter of 2017, 537 homes sold with an average price of $280,216. Sellers settled for 2.6% less than list price in order to sell. Homes were actively marketed on average 43 days before going under contract.

 

  Fairhope: 214 homes sold with an average price of $367,421 (very much skewed by the $1 million-plus sales). This time last year, 205 homes sold with an average price of $327,510. Sellers took 3.6% off list price in order to sell. Days on market stood at 46 days.  

 

  Daphne: 255 homes sold, compared to 224 sales this time last year. Average sales price rose to $250,620 from $239,013 in the 3rd quarter of 2017. Sellers trimmed 1.9% off list price in order to make a deal. It took on average 35 days from list to contract.  

 

  Spanish Fort: 124 homes sold with an average price of $300,778. This compares to 108 sales with an average price of $275,905 this time last year. Sellers settled for 2% less in order to sell. And days on market stood at 54. 

 

 

 

 

 

 

Market swings to favor sellers

June, 2018

 

Home sales on the Eastern Shore are cruising ahead, keeping pace with this time last year almost exactly. With a notable exception: The average sales price is up 7.3%! That’s a large indictor of a market that is steadily tightening in the sellers’ favor.

 

And here are two other pieces of interesting data from the recently completed second quarter:

 

   * New homes represented 32% of all sales in Spanish Fort, Daphne and Fairhope.

 

   * The time it took to sell – “days-on-market” -- dropped to under three months, from more than four months at the same time in 2017. 

 

This year, the reporting of days-on-market freezes at the point that a house goes under contract, eliminating the closing or escrow period. Still, this drop is certainly eye-catching.

 

Let’s look at the compete sales numbers for the second quarter of 2018 on the Eastern Shore:

 

Eastern Shore as a whole: 670 single-family homes sold with an average sales price of $311,033, compared to 671 sales with an average price of $289,893 during the second quarter of 2017. Sellers trimmed an average of 2.3% off the asking price. And days-on-market tumbled to 88 days from 135 days.

 

Spanish Fort: 146 homes sold, compared to 147 sales in the same period last year. But the average sales price (largely fueled by new construction in this ZIP code) jumped to $301,087 from $282,679. On average, sellers took 1.55% off their asking price. (This number is very likely affected by new construction where few discounts are given). Days-on-market dropped to 94 days from 148 days.

 

Daphne: 283 homes sold, up from 261 sales this time last year. Average sales price also jumped, to $265,466  from $237,341. Sellers settled for 2.2% less than list price. And the time it took to sell dropped to 91 days from 134.

 

Fairhope: 241 homes sold, down from 263 sales in the second quarter of 2017. But the average sales price rose to $377,430 from $346,115. Sellers trimmed 2.9% off list in order to close. Days-on-market was the Eastern Shore’s shortest:  81. That figure was 125 days at this time last year.

 

 

 

Oct. 6, 2011

Mortgage rates fall to historic lows

Freddie Mac announced Thursday that 30-year fixed mortgage rates fell below 4% for the first time ever. The new rate - just 3.94% - is lower than the rate in the 1950s, according to the National Bureau of Economic Research. For buyers looking at homes in Daphne, Fairhope and Spanish Fort, you'll find the 15-year fixed rate in the lower 3% range locally.

For example, Mary Brabner, loan originator for Region's Mortgage in Daphne, AL, says her 30-year fixed rate is 3.875% today. This is for over buyers with credit scores over 740, with 20% down on a purchase. A 15-year rate is 3.25%, Brabner said. Dean Watson of WestStar Mortgage, also in Daphne, AL, says rates may be higher for those whose credit scores are below 740. WestStar offers mortgages that don't require the often pricey wind coverage for home owners insurance; for that the rate may be a bit higher, he said.

With a nice selection of homes for sale in Spanish Fort, Daphne and Fairhope, it's a great time to buy and lock in a low fixed rate. If you have sufficient equity, it's also a great time to re-finance.

Posted in Buying a Home
Oct. 5, 2011

VA funding fee changes Oct 1, 2011

Veterans closing mortgage loans after Oct. 1, 2011 will find that the funding fee has been reduced on VA loans.

Here's the new structure:

VA loans may not always be the best choice for financing, so be sure to do your research.

Posted in Buying a Home
Oct. 5, 2011

What is a short sale?

What is a short sale?

A short sale is the sale of a home or property for less than what is owed on the property. The seller must have also experienced some sort of “distress” and must sell. (Example, the seller of a home in Daphne AL owes $250,000 and the house value has fallen and it’s only worth $200,000. So there is an immediate $50,000 shortfall plus closing costs). It does not necessarily mean that the property is heading into foreclosure.

Why is it sometimes called a potential short sale?

That’s because it is ultimately up to the seller’s lender to approve the sale. After all, it’s the lender who is taking the major financial hit here.

What qualifies as a distress for a seller?

Many, many things from personal to financial misfortunes, to simple changes in circumstances. One lender even has a checklist. Death, divorce, illness, expanding family, loss of job, reduction in pay or hours, even increased home owners’ insurance payments. Many short sellers have experienced a combination of one of more of these.

Can anybody who has had a change in circumstances qualify for a short sale?

No. The seller cannot have a lot of cash available, no substantial assets. Basically a seller can have just enough to get by.

Who sets the price?

The Realtor sets the price according to the market value. When there aren't a lot of comparable solds to determine price, the Realtor may start the pricing at what is owed on the property then systematically reduce it over time to demonstrate to the lender that the house wasn't being shown at the higher price and the market value has declined.

How long does it take?

Short sales used to have a reputation for being a nightmarishly long experience. But over the years the time it takes has been reduced to around 45 to 90 days.

Is it really better for the seller to do a short sale or to just let it go into foreclosure?

The general school of thought is that a foreclosure will result in a larger hit to a credit score than a short sale. The same holds true for deed in lieu of foreclosures (where you give the house back to the bank). This is because foreclosures are recorded at the courthouse and end up on your credit. Short sales typically are not. Also, a short seller should be able to purchase a home again within a shorter period of time than someone who has been foreclosed upon.

Does a seller have to pay anything in a short sale?

It depends. The lender can file a request that the seller repay all or part of the difference between the sales price and what is owed. In my experience I have seen the lenders forgive the debt entirely, and I have seen then lender write off around $100,000 and request the seller repay just $2,500 over a period of years with payments under $100 a month.

So what does a seller have to do to get a short sale going?

A qualified Realtor can guide a seller through the short sale process. Generally, the lender will request the seller write a letter outlining their personal, work and financial history and why they are requesting a short sale. The lender will also request copies of bank statements, pay stubs, and tax records.

Sounds like a lot of work?

Yes, it's some for the seller, but even more for the Realtor who has the house listed. But it's an good option for homeowners in financial distress who need to move.

If I've received a default notice is it too late to do a short sale?

It depends on where you are in the foreclosure process and whether you meet the short sale criteria.

Do I have to be late on my mortgage payments to qualify for a short sale?

I cannot tell you to not make a mortgage payment, but the general school of thought is you have to be late or make a partial payment for a lender to consider a short sale. I have heard of one lender that doesn’t require you to be behind on payments to do a short sale. But be careful here: If you are late too many months, you will trigger the big, bad foreclosure process which can complicate the short sale.

If you think you may qualify for a short sale and need more information, feel free to call me at 251 591-2411.

Posted in Selling Your Home
Aug. 30, 2011

How to do a lease purchase and why you shouldn't

"Would your sellers consider a lease purchase?" two separate agents have asked me in the last two days on two separate listings.

And each time, I've explained the pros and cons of such an arrangement to my sellers. Both sellers passed and here's why.

First, the Wikepedia Definition: "A lease purchase contract is a shortened name for lease with option to purchase contract. It is a form of real estate purchase which combines elements of a traditional rental agreement with an exclusive option of right of first refusal to later purchase a home."

The initial challenge of a lease purchase is to make sure everyone knows what they are talking about, even the agents. Often, the buyer is thinking "lease with option to purchase" while the seller is hearing "purchase with delayed closing."

This hybridized contract has come and gone over the years, most recently with the soaring interest rates in the ‘80s, and now with the difficult market we face today. It's a product of desperation, really no better than simply renting a house. In the end, it's like like trading in house futures.

Here's a typical scenario:

Mr. Buyer has a home on the market in another city. But his job - and the kids' school - starts in your market in one month. He wants to get his family settled. He's found the perfect house for $200,000.

Mr. Seller is thinking about building a $300,000 house and has his house on the market. It's a slow market, a soft market and maybe he'll get full price if he agrees to this lease purchase. Mr. Buyer comes along with the lease purchase proposal. Ms. Seller thinks he can rent elsewhere and get started building his new house. The agents negotiate the offer - one part lease and one part purchase -- with Mr. Buyer providing $10,000 non-refundable earnest money if he doesn't close within the year. (In some cases, Mr. Buyer will want a portion of his "rent" applied to the purchase price.)

If you can get past the obstacle of Mr. Buyer agreeing to non-refundable earnest money, then on to the more mundane home inspection issues, here's what the principals and agents could encounter.

Benefits to seller:

  • Possibly higher selling price.
  • Cash flow, particularly if property is vacant (which is why this may be attractive to some builders.)
  • House is under contract (maybe or maybe not)

Cons for seller:

  • Equity still tied up in house and seller cannot proceed with his plans to buy, etc.
  • Housing prices could rise and the seller is locked into a lower purchase price.
  • Market could decline and tenant/purchaser decides house is not worth agreed upon price. Or tenant/purchaser may find another house they like better in the interim.
  • Interest rates could rise and tenant/purchase may not qualify for a loan.
  • Tenant/purchaser may not keep up property.

Benefits to buyer:

  • Making only one move saves time and money vs. renting, buying and moving again.
  • Buyer gets to shakedown period to really figure out if they want to buy this property.
  • Housing prices could rise and tenant/purchaser now finds he's made a pretty good deal.

Cons for buyer:

  • Locked into agreement and they decide house is not worth price or find another property.
  • Interest rates could rise and tenant/purchaser sees his payment going up when the house closes.

Money always talks and in this case it's the $10,000 non-refundable earnest money that's keeping this deal together.

The longer the terms of the contract, the more likely that housing and financial markets will change, making what once seemed like a good deal, merely a memory.

For agents, it's a lot of work with little promise that the house will close. Chances are, no one will be happy. Not the buyer. Not the seller and certainly not the agents.

Posted in Selling Your Home