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Florida Real Estate NewsSeptember 13, 2005 Who We Are | Letter from the CEO |
The Florida Real Estate Market
Who We AreWelcome to the many new recipients of this newsletter. My name is Matt Whitnack. I am a business partner of Jules Roman, David Tischler, and AJ Todd. The four of us own a Florida-based real estate company called LeaseOptionProgram.com. Jules and I have moved to Florida to more actively manage and grow our investments. I have my real estate license and process the many transactions of our firm. Jules is a loan officer and sources the mortgages for us and our investors. We are also developers involved with several projects in Southwest Florida. The purpose of this newsletter is to inform you of our activities, the status of our market and to make you aware of the many investment opportunities we have available. Please feel free to forward this on to your friends, family, and colleagues. If you would no longer like to receive this email or would like us to add someone to the distribution list, send me an email at mattw@leaseoptionprogram.com. Letter from the CEO
Our thoughts and prayers are with the many families affected by Hurricane Katrina. If you have not already done so, please consider making a donation to one of the many groups assisting the thousands of affected families. These families have lost so much and now find themselves far from a home that in many cases is no longer there to go back to. Here in Southwest Florida we have so far dodged a direct hit from a hurricane. That’s good news for the many residents of Charlotte County who surprisingly still have blue tarps on their roofs from last year’s record setting season! We have been very busy with making adjustments and planning a multi-market expansion for our LeaseOptionProgram.com business. We have also been working hard at getting our development project, Lakes of Lehigh, up and running. I am extremely happy to announce that as of September 14, 2005, Jules Roman and his family will be full-time residents of Florida! I am looking forward to our families spending lots of time together but more importantly I will be able to unload a bunch of work on Jules. He will get his revenge, however, by making me attend his 6 a.m. spinning class he’s already signed up to teach at the local gym! We are currently planning a live web-based presentation (“webinar”) for all of you to learn more about the investment opportunities that we currently have available. We plan to allot a significant amount of time for you to ask questions as well. The webinar will be in about two weeks. In order to best plan this event, I am asking all of you (344 strong and growing!) to complete a very short survey. Please take five minutes to help us make the event a success! The Florida Real Estate Market
Bubble. That is the main theme of almost every discussion about real estate in Florida. “Is there a bubble?” “If so, when will it pop?” “How bad will it be?” “This is just like the stock market of the nineties…” It’s hard to continue to shrug off the idea of a bubble when prices in many areas continue their record climb with quarter after quarter of double digit gains. The median house price in Sarasota County has crept over $360,000, lagging only behind Naples on the Gulf side of Florida. So is it a bubble? I personally think bubble is an incorrect descriptor as it insinuates that a burst is inevitable. While I do think that the Sarasota market has been artificially inflated by an enormous amount of speculation, I don’t believe it’s a bubble ready to burst. There is strong underlying demand for real estate by the many people moving to the area and those picking up second homes. 30,000 people make Florida their new home every month. Many of these people are choosing Southwest Florida. We are starting to see signs suggesting that the Sarasota market is cooling. There is a much larger inventory of properties for sale in recent months when compared to those same months in 2004. The condo development in the city of Sarasota has seemingly outpaced the demand as prices are starting to decline. There are a lot of condo developments under construction with more coming. Tired of giving up a lot of profits to flippers, developers have effectively closed their preconstruction products to investors by offering only non-assignable contracts, requiring buyers to close on their units and not allowing the property to be sold until 12 months after closing. The result has been fewer sales. Other coastal counties like Charlotte, Manatee, Pinellas, and Lee are also realizing continued gains in pricing, but at a slower pace. Some areas in these counties have a much less heady median price still in the low 200’s. Developers are beginning to focus heavily on Charlotte County and on most inland areas in the other counties that are east of I-75. There is a lot of raw land available and it’s the only natural direction to turn to handle the population growth. Many of the counties are considering adjusting densities, but that road is fraught with many obstacles such as a lack of water, lack of adequate roads, environmentalists, crowed schools, and current property owners worried about the potential impact to the value of their own properties. One of the top issues in Sarasota County and most other coastal counties is the lack of affordable housing. However, it is not called “affordable housing” locally; it is called “workforce housing.” Affordable housing conjures up images of a lack of housing for poor people. In these markets, there is a major lack of affordable housing for the teachers, nurses, government employees, and the many others who make up the work force of the area. In order to afford the median house in Sarasota, a household needs to make $100,000 a year or more. This seems to be an unsolvable problem. However, rental vacancies have been increasing applying downward pressure on rents. Affordable rental units seem to be the only real, sustainable solution to this problem. The problem is, most of them are being converted to condos and are being sold off. I would love to see a graph of the number of rental units in these markets over the past couple of years, but have been unable to locate one. I’m sure it would show a very steady decline. Bubble. Well, as long as the richest retirement population in our nation’s history continues to view Florida as the destination of choice to spend their much longer lives, I don’t feel that we’re in a bubble with an inevitable burst. We will see some slowing down of the price increases, and history says that we will have a few flat or maybe even some (shudder) down years. Real estate markets trade less quickly than most other markets making the signs much easier to read and react to. Buy low, sell high. Each retirement generation is healthier and more active than the last and they desire climates that they can enjoy year round. The workforce is increasingly more mobile and more equipped to do their jobs from home or even from the remotest of locations. These people are choosing states like Florida, the Carolinas, Arizona, and Nevada to call home. Just remember, the generation following the Boomers is much larger, richer, and will live even longer. I think Florida will continue to be an outstanding market for real estate investments for a long time to come.
The company continues to see high demand for its products in the Sarasota, Charlotte, and Lee County markets. We continue to struggle with finding housing for our Sarasota customers and have decided to pull our public advertising from this market. We are going to concentrate those advertising dollars on the much more affordable and significantly larger market found in the Clearwater/Tampa/St. Petersburg area. We will be advertising in the state’s most circulated newspaper, The St. Petersburg Times, beginning this weekend. For those of you that are new to this newsletter, LeaseOptionProgram.com is a company that seeks out people who are having a hard time obtaining an affordable mortgage despite having a good income and a sizeable down payment. This can be due to poor credit, lack of enough funds for a down payment and closing costs, lack of income outside of self-employment sources, and for many other reasons. Customers apply for our program, and we qualify them for a maximum home value. Our customers choose the neighborhood and the home, and we buy it. They live in the home under a lease and have an option to buy the property at a later date. This gives them time to improve their situation so they can obtain an affordable mortgage allowing them to successfully exercise their option and buy the home. This is a far superior way to invest in rental properties as vacancies are significantly reduced, cash flow is vastly improved for the landlord, and the tenant is 100% responsible for all maintenance. This eliminates the famous midnight call to the landlord regarding a backed up toilet. We are beginning to focus our efforts at reaching out to the many real estate agents and mortgage brokers in our markets. These professionals now have a place to send their clients who are having a hard time securing an affordable mortgage. We place the client in our program and retain the real estate agent as our agent or use the mortgage broker to source our loans for the property. These professionals can now close business they were previously turning away while receiving 100% of their commission! Now that’s truly a win-win! Next week we are mailing a flyer to all of the real estate and mortgage brokers across the entire state of Florida announcing our program. Because of all of this activity, we have hired our first full-time employee, Jean Fox. Jean will be handling the majority of our telephone calls and will be driving sales for the company. She will also be providing me with much needed administrative assistance. I am very glad to have her on board! In the News…
Well, LeaseOptionProgram.com did not make the news this time around, but one of our partners, Jules Roman, did. While I give Jules a hard time about not working even an obscure mention of the company in, it was a very good article:
Is now the time to sell invesment properties?.
Investment Opportunity…For the many of you who have expressed interest in buying rental properties in Florida, LeaseOptionProgram.com offers investment packages on a first come, first serve basis. We have added content specifically for investors (such as example financial data) along with a sign up form at www.leaseoptionprogram.com/investor.htm. You can learn all about this completely hassle free way for you to buy rental properties in Florida. We find the lease option tenants, we help them find the right house, you buy the house, we manage the property, and the tenant takes care of maintaining the property. There is no better way to get into rental housing in the top markets in the country! In order to reserve your place in line for upcoming opportunities, it is imperative that you sign up with us on the website at www.leaseoptionprogram.com/investor.htm. as soon as possible. We will be presenting this investment opportunity at the upcoming webinar as well. Lakes of Lehigh
We are at the very early stages of launching our development project, the Lakes of Lehigh. Lehigh is a small, rapidly growing area due east of Ft. Myers. Lehigh is just starting to take off and is a more affordable location for the Ft. Myers workforce to live. It is within minutes of the region’s largest airport, Southwest Florida International. Cape Coral had been the destination of choice for much of the workforce, but the traffic on the bridges coming on and off the islands has become a nightmare. Lehigh Acres is also becoming home to a lot of people leaving Naples due to the $491,400 median house price and severe traffic congestion issues. The initial development is in a part of Lehigh called Lehigh Acres. There is a lot of vacant land available for development. Many new homes can be seen going up in the area. Currently, there are no large-scale planned community developments underway. Our strategy is to develop high-quality lakefront single family home neighborhoods branded as a “The Lakes of Lehigh” neighborhood. These are planned communities with homeowners’ associations. We are the only development company in Lehigh Acres with this type of product. This unique offering gives us a very significant competitive advantage. We are currently selling the first phase of Lake Shallowford Estates. You can find more information, including floor plans, home features, a site aerial, and a plat map at www.lakesoflehigh.com Investment Opportunity…For your benefit, we have designed this development to be very investor friendly! The words “investor friendly” are not spoken very much in this part of Southwest of Florida anymore. As I mentioned earlier, developers are shutting investors out of their developments. Here are some highlights of why we are investor friendly:
In Florida, the time between Thanksgiving and Easter is known as “The Season”. Real Estate prices escalate rapidly during The Season as the massive influx of snow birds descends on the area and they begin buying up enormous amounts of real estate. Now is a good time for you to lock in pre-season prices (while enjoying a discount!) and line up a flip for later in the season. We’ll even help you with finding a buyer for your flip to help secure your profit! Please make sure you complete our very brief online survey Our Contact InformationMatt Whitnack Jules Roman Please Note:
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