Pitch a Tent in Key West

So you have some money that you want to use to buy a property in Key West. You have read that the market is down, and you have decided that now is the time to pitch a tent in Key West. That's me in the photo to the right. I pitched my tent near Rifle,Colorado in 1997. Never heard of Rifle? It's on Interstate 70 between Vail and Grand Junction. It is actually very pretty. If you do a quick Internet search you will see that property values there, though less on the low-end, are proportional to Key West prices for mid-range properties.

Take the pretty as a picture cabin in East Rifle (other photo to the right). It is listed at $950,000, but that includes Pond! One bedroom one bath mother-in-law apartment with single car garage. 8 acre shares of Silt Project Water. Inclusions - 2 stoves, 2 refrigerators, 2 dishwashers, 2 microwaves, window coverings, leather couch, bar and keg in family room. Exclusions - Sellers personal property, 2 freezers in garage, hay in barn, dumpster and 2 grain bins.

But if you look at the cozy little 3 bed, 2 bath fixer-upper in the town of Rifle priced at $240,000 you'll see that fixer-upper isn't that much of a better deal than a Key West fixer-upper, especially since it is located in the boonies.

Now one could say that Key West is at the end of the road, and they would be right. You don't just happen upon Key West by accident. Well, I guess you could be driving and make a wrong turn in Homestead and end up here. But that is doubtful. No, people come here on purpose: to have fun and enjoy the weather and the easy-going lifestyle.

I did a quick search of the Key West mls database and came up with a list of single family homes priced under $1,100,000 in the Old Town area. Take a look and see if one interests you enough to decide to pitch your tent in Key West. I included a couple of "affordable" properties as well as a couple of homes that are what just about every second home buyer dreams about when they conger up what their Key West home should look like. The issue is not being able to find the right property, but it is rather finding the right property at the right price. No matter how much you want a property, even in a down market, you must pay the price. As a buyer you cannot just wait for the price to drop to your comfort level. Your expectation of price and value must be grounded upon a rational basis.

CLICK HERE to do your own personal search of home in Key West. If you see something you like please give me (Gary Thomas) a phone call at 305-766-2642 to schedule a showing. Or contact me by e-mail at kw1101v@aol.com. If all else fails and you can't find a home at the right price perhaps you can pitch your tent at Boyd's Campground on Stock Island.

2007: That Was the Year That Was

Hey readers, I am not a statistician. I am a firm believer you can use statistics to justify any position you want to take. The accuracy of the information I am about to give you comes from the records of the Key West Association of Realtors mls database. The information in that database is entered by individual offices or sometimes individual Realtors. Get the point: I am hinting that the numbers are probably not 100 per cent correct. You know the phrase "garbage in, garbage out". I am certain that innocent errors were made while entering data. Also, our database contains some duplicates (long story--accept what I say.) Nevertheless, it is what we have to work with.

In 2004 there were 461 single family and condo sales totaling $335,058,765 in Key West. (The specific areas are the islands of Key West, Stock Island, and up to and including Shark Key.) This is our base year.

In 2005 there were 522 single family and condo sales totaling $505,594,132. There were 4 major hurricanes that hit Key West this year with Hurricane Wilma being the strongest and the one that had major short term and long term impact on the island and the economy of Key West. The sales volume in 2005 provided a 66.27% increase over the sales in 2004. And the number of sales increased 61% during that time.

In 2006 there were 302 single family and condo sales totaling $275,697,052. The Key West economy was in recovery most of the year. Many homes were damaged during Hurricane Wilma and local builders and individual homeowners did a significant amount of rebuilding after the hurricane. Buyers were very apprehensive because of the hurricane and the realization that the entire US housing market was in decline. Homes sales declined over the year 2005 by 54% and the number of sales declined by 57%.

In 2007 there were 336 single family and condo sales totaling $283,211,865. The good news is that our sales were up over 2006 by .027% in dollar volume and up by 11.25% in the number of sales. Not a lot, but it is better than being down.

Something really foreign happened in Key West during 2007: the local economy took a deep downturn. Several businesses shut down. Some Duval Street merchants through in the towel and closed rather than getting beaten to death by greedy commercial landlords that demanded higher and higher rents. There were a lot of foreclosures. Some borrowers were able to fend off foreclosure by getting their bank lender to accept a Short Sale price which allowed the seller/borrower to walk away from the property and the debt with the lender getting most, but maybe not all of its loan repaid. There had always been an occasional foreclosure in Key West, but the number of foreclosures in 2007 was totally counter to experience. Year after year property values increased by at least 10%. So the loss of market value (and that is exactly what occurred) was shocking.

In the year 2005 the asking price for a home in Old Town was just about $1000 per sq ft pretty much across the board. Now in 2008 the asking price has adjusted to the new reality that the heyday market of 2005 is gone forever. Many (but not all) sellers are listing their properties more realistically. Some Realtors (read my item Listing Whores) continue to act like enablers who create an atmosphere in which the seller can comfortably continues to believe that their homes are so special that they can command an exorbitant price. I just did a quick check of new listings for the last week of December 2007. The prices ranged from $270 to over $1400 per sq. ft. There are many, many still priced over $1000 per sq ft.

Since we are at the beginning of 2008 the pundits are busy telling us what we already know (or choose to try not to recollect) and that is "The United States is deep in its worst housing slump since the Great Depression, and according to a new report, it's not going to get better any time soon." GO HERE to read the CNN Money item that discusses with clarity the predictions of the potentates from on high. Note that they specifically site three Florida localities (not near Key West) that are probably going to melt-down during 2008: Naples, Fort Whalton Beach, and Punta Gorda.

We are seeing things a little more optimistically here in Key West. I already pointed out that our sales are better in 2007 than they were in 2006. But we also have 46 properties under contract that are waiting to close. The least expensive is $235,000 and the highest is a home on Sunset Key at $5,100,000. There are 18 properties priced over $1,000,000 that are contingent or pending. The average price on those is $1,478,500. Forty Six properties waiting to close as of today, January 1st. That's a pretty damned good way to start the new year. Those folks up in Naples, Fort Whalton Beach and Punta Gorda should be so lucky. By the way, our weather is better, are people are certainly more interesting, and we don't have their traffic.

CLICK HERE to checkout the Key West mls database. It is maintained in real time
not like on a lot of search sites that has dated info. So what you see when you search is what is really availble. After you have done your searching, please call me at 305-766-2642 or e-mail me at kw1101v@aol.com. I'd be glad to help you find your home in Paradise. Don't make the mistake of waiting for the other shoe to drop. That only happens at the Bourbon Street Pub (never did understand that name!) on Duval Street at midnight on December 31st. Things are going to start going back up.

627 Elizabeth Street in Old Town Key West

627 Elizabeth Street might be the vacation home you have been waiting to find.

Classic Old Town Conch house in prime neighborhood that is more than 85% completed. Completely renovated with second floor addition for more living space. Fantastic opportunity to pick out the final touches or wait for completion in approximately 60 days.

The main living area and kitchen are located at the rear of the property and overlook the new pool. There are two bedrooms on the first floor and the master bed and bath are on the second floor and have a view of the pool. The ceilings in the entry hall and main living area are vaulted.

The house sits at just about the highest point on Solares Hill so you will not need to pay for flood insurance (or worry about flooding). The neighborhood has a mix of homes most of which have been renovated over the past several years. There house at 620 Elizabeth sold for $2,999,999 in 2005. A similar house next door at 625 Elizabeth sold in 2005 for $1,295,000. The house at 600 Elizabeth sold in March 2005 for $2,680,000. Several other high dollar sales were made in the immediate area over the past three years.

I think this property is well suited for a second home buyer who wants a house with everything "new" and nothing to be done. It works well for a buyer who wants to move in "tomorrow" so he can enjoy his life. The house is divided so that guests or children sleep in the bedrooms at the front of the house while the owner sleeps in the master bedroom area located at the second floor rear. Imagine being able to actually move in to a new house in Old Town with a pool and off street parking sometime in the next couple of months. Oh and did I mention everything is new. So you won't have to go out and hire a plumber or carpenter or electrician to fix things. The work has already been done.

So many first time buyers see old houses that are a little run down and think they can buy the house and re-do it and save a bunch of money. The time frame to do that is well over a year from start to finish. You can't enjoy your home for that time period. But you will be able to have fights with your contractor and subcontractors over a variety of issues. Saving money is illusionary. Let somebody else do the work for you and enjoy your vacation home in Paradise immediately.

If this house or any other Key West home CLICK HERE to perform your own search of the Key West mls database and then call me, Gary Thomas, at 305-766-2642 to schedule a showing.

Half Price Sale on a Single Family House in Old Town

The little house at 1119 Olivia Street in Old Town Key West has just been reduced to $635,000 from its original price of $1,275,000 in March 2007. Half Price! Too bad it wasn't worth the original asking price, however. The property is owned and listed by a Realtor--not me. Thank God. But he must disclose that to the public. Please don't take these comments on my part as being negative. But you need to know the facts when you invest your money in property. Especially now!

This is an excellent opportunity to own your own Conch home located in Old Town. The home at 1119 Olivia Street was completely renovated in 2005. The property is Located in the X flood zone and sustained no damage in any of the hurricanes. A true high and dry property. Some of the features include: 2 licensed residential units, 2 off-street bricked parking spots, separate electric meters, granite counters in kitchens, and central A/C, and room for a pool. The property consists of a 1 bed/1 bath apt above rented at $1,200, and a 2 bed/1 bath below rented at $1,700 Per month. Owners will have flexibility of occupying entire home as a 3bed/2bath or renting out a portion as a lock out unit. Building was termite tented in July, 2006. As I mentioned the house is now priced at $649,000 or $550 per sq ft. That price makes it very competitive in the market since it is well located in Old Town, has off street parking, and is legally licensed as two living units. The present owner purchased the house in April 2005 and paid $785,000. He then did the renovation which had to cost a minimum of $100 per sq ft rounded to $150,000. So I would increase the capital investment in the property to be in excess of $$935,000. Some smart shopper is going to buy this house on its Half Price Sale quite soon. Mark my words.

A couple of weeks back I wrote an item about the house directly across the street at 1118 Olivia which is priced at $485,000 or $700 per sq ft for a 2 bed 1 bath home that is in a compound. I think both properties have their individual attributes. The two units at 1119 Olivia is a potential Short Sale. I think that any sale of 1119 property will necessarily require the approval of the current lender.

CLICK HERE for more info, additional photos, and a map to help you locate 1119 Olivia Street.

CLICK HERE to perform your own personal search of all Key West mls listings. Then give me (Gary Thomas) a call to schedule a personal showing. My number is 1-305-766-2642 or you can send me an e-mail at kw1101v@aol.com.

Is it a good time to Buy or Sell in Key West?

Is it a good time to buy or sell real property in Key West?

In a market of volatile prices take advantage of other peoples misfortunes. A couple of weeks ago I listed numerous properties that are in the process of foreclosure or already bank owned. These are buying opportunities. The bank owned properties are routinely reduced in asking price because the reluctant bank owners want out ASAP.

Here is a "for instance" of a non-bank seller that wants out now. I suspect something is amiss. Today there is a new listing of what is an attached two story condo 202-1 Southard (Shipyard). It is the only unit of its kind. This unit was purchased in June 2005 for $1,170,000 and is now being offered at $1,095,000 or $75,000 less than the price paid two years ago. The present asking price is too high on a price per sq ft basis, and I think the seller will probably have to accept a much lower price. But the uniqueness of this particular unit make it a good deal for a buyer who buys at the right price. It looks to me like the seller has to sell and it just a matter of determining how much of a loss he (or maybe his lender) can absorb.

Here is another "for instance". Our office has a customer who owns a mixed use property that she wants to sell. She bought it many years ago, and it is debt free. She gets a good rental income on it so she is not losing money. But the tenants are not triple net, so she does have ongoing property management and maintenance expenses. The property is located on a major street near Duval. The property was originally a two story Greek revival (Conch) house that has been converted to a small retail use and there also two licensed transient guest rooms. It is really not suitable to going back to single family use because of its location. And because it lacks any meaningful off street parking, it is not really suited to a full commercial use. The owner has left the area and would like to sell. She obtained market value opinions from two commercial brokers, a "star" residential Realtor, and from an agent in our office. The two commercial brokers told her $2.5 million. The "star" said $1.6 million. The agent in our office told her $1.7 to $1.8 million if she could wait a few years. I think the real price is around $1.4 to $1.5 million today.

Should she sell? Is it worth sitting on for 5 or 10 years to maybe get the $2.5 million. I say "maybe" because we cannot predict exactly when, if ever, the property will reach that price. Should she sell it now and forgo the possible gain of a million dollars or more at some future date? I told the Realtor in our office that she ought to sell it now and get out. She should convert an asset of determinable present value into an asset capable of earning a defined income.

I did a present value analysis of the $1.5 million invested at 5% over 5 years. The future value of that amount is $1,914,422.34 or growth of $414,422.34. If she could earn a 6% return the future value would be $2,007,338.37 or growth of $507,338.37. That is what she could earn from no risk certificate of deposits.

Maybe she could use her $1.5 million to purchase a replacement(triple net commercial property) where she now lives. If she established an 8% rate of return her $1,500,000 would become $2,203,992 in five years. She could determine exactly what the future value of her non-earning asset would be simply by acting prudently now. And she could also enjoy the upside of rising property values in a market where she resides.

The owner is in her fifties so there is a good likelihood that she will be around for several years. But in the event she should pass away, what do you think her estate will do with the property? Sell it, of course. And estates are notorious for selling short. Or maybe she just sits tight and waits for the market to rise, but it doesn't. Or maybe it even declines more. Anything is possible.

You cannot predict what the future will be, but you can make prudent business decisions to reasonably insure that your assets will be worth more in the future than they are today.

CLICK HERE to checkout all Key West mls properties.

Make Your Friends and Neighbors Green with Envy

Just Listed: 719 Fleming Street Key West, Fl. $2,595,000 or $1042 per sq ft for this 2490 sq. ft. home on a large 6420 sq ft lot.

The Grande Dame on Fleming is a stunning and elegant historic home in highly desirable Old Town location. Meticulously restored this 1859 home is one of the most exquisite properties in Old Town. CLICK HERE for more detailed info and more photos of 719 Fleming Street in the heart of Old Town Key West.

This home is just shy of 2,500 square feet under air and has an expansive 1,100 square foot of Brazilian Ipe' terrace. There is a Chef's kitchen with stainless steel appliances, slate counter tops. Four bedrooms, custom spa bathrooms, European Kable Lighting systems, original glass pane windows, and high quality finishes throughout. Off-street parking, prime location steps from the best of Key West's beaches, marinas and nightlife. Large yard, beautiful pool with travertine stone decking, lush landscaping, and balconies perfect this ideal haven for sophisticated island living.

The home is located midway between William and Elizabeth on Fleming Street and sits directly across the street from the garden CLICK HERE FOR PHOTO adjacent to the Monroe County Library. It is a short walk to all major Key West attractions. A few doors to the east you will find the house that PBS "This Old House" restored a couple of years back. And a few doors to the west you will find two homes that Broadway emprasario Jerry Herman renovated in the early 1980s. So you won't need a car to get to your yacht or your favorite restaurant or other Old Town attraction.

The off street parking is exceptional. The lot is over sized and will make your automobile ventures non-troubling which is unusual for being located in the heart of Old Town.

Not everyone can afford a home like this. If you can, give me (Gary Thomas) a call at 1-305-766-2642 to schedule a showing. If you are looking for a place less expensive, don't fret. There are a lot of well priced homes and condos available in Old Town and throughout our little city. CLICK HERE for a quick peek, select a few properties that you think may meet your interest, and then give me a call. Who knows, you may make your friends and neighbors green with envy by buying now before the prices rise.

Terrific Island Location, but you can't Escape

1516 Laird Street was just reduced from $949,000 to only $789,000 or $439 per sq ft for this 3 bed, 2 bath home with 1796 sq ft of living space on a 5547 sq ft lot.

From the formal living room the home flows into an open kitchen with skylight and a Florida room area that is flooded with natural light. The split bedroom allows for a private master suite at the rear of the home with its own double French doors providing access to the tropically landscaped pool and garden area. Another set of double French doors lead from the Florida room to a Mexican tiled patio surrounding the 12' x 30' pool.

Home has a new metal V crimp roof, new air handler and ductless AC system in master bedroom, freshly painted inside & out, new soffit and fascia, fumigated within the last year, new pool equipment and more.

Now you have to look at the photos to appreciate the enormity of what you would be getting if you bought this home. CLICK HERE for the pics and more info. Then call me, Gary Thomas, at 305-766-2642 to schedule a showing of this home. This is a lot of house for the price. Business is starting to pick up and a smart buyer is going to snap up a house like this when it is priced this competitively.

However, if your heart is set on Old Town and your budget is set lower than the Laird Street home, consider 5 Hunts Lane. It was also just reduced in price from $499,000 t0 $409,000. Hunts Lane is located midway between Margaret and Grinnell on Southard Street. The lane has no vehicle access: it is only a walking lane. So life there is a little more challenging, but you still have all the benefits of a quiet and convenient Old Town location.

The house is ripe for renovation (meaning it needs it). But it is priced at only $338 per sq ft which makes renovation economically doable. The house has 3 bedrooms and one bath and is 1210 sq ft. The home has been in the ownership of one family since it was constructed. CLICK HERE for more info and photos.

The house on Laird is ready to dare. And the house on Hunts Lane is ready for flair. So if you want to lay back by the pool you can do that. If you want to wield a hammer and redo a historic home, you can do that. You can do either at an affordable price as well. Give me a call.

P.S. The town was invaded mid-day. There are thousands of new faces everywhere. I kid you not. And it only gets worse the day after Christmas. It is like the 1950's horror movie "Invasion of the Body Snatchers". They are everywhere. And there is no escape.

Listing Whores--You Know Who They are

For the life of me I have never understood why someone would want to use the same Realtor as everyone else. There are about seven listings whores in Key West whose names are well known and who get the majority of the real estate listings. (I'll make nice and call them "stars" instead of whores, but you get the point.) Hence, they get a very good percentage of all the real estate sales in Key West. Success begets success.

But what goes into a seller's mental process that makes him think his star Realtor will be more likely to find a buyer for the old homestead than someone else?

Ask yourself how many listings a star Realtor can effectively service at any one time. After all it takes more than getting a listing agreement signed, placing a sign on the property, entering the listing information onto the mls website, taking photos of the property or arranging to have them taken, creating ad layouts for the newspaper and magazines, and showing the property to "service" a listing. You may agree with that premise, but you may still think that star Realtors have assistants to take care of all the "busy" work, so that all the star has to do is show your property to his buyers and the deal is done.

It doesn't happen like that. It did not happen that way when the market rocked, and it certainly does not work that way now that we are in decline. Realtors have to work at selling a listing. They contact prospects and market property to people who have expressed interest in a specific type of property. They conduct Open Houses. (Schedule it with the owner and maybe tenants; run an ad; place signs around the area; sit and show the home; discuss the results with the owner. That is probably 4-5 hours of time. A Realtor will also put the property on Realtor Caravan (showings just for other Realtors). That doesn't sound so onerous you say. Well, it isn't. But if you multiply all those individual tasks by lets say 20 or 30 or more, you can see how the time of a star Realtor and all of his assistants is spread a little thin. Maybe a lot thin.

I checked to see the number of residential listings a couple of the "star" Realtors had. One person had 77 and most were high-end listings. Other Realtors in the same office had 30 to 60 residential listings each. Again, most of those listings were high-end properties.

I can tell you by experience that if you go to a very good lawyer's office with a case that is dear to you and that may take his or her time to handle that the lawyer will either turn your case over to an associate or refer you to some other attorney. It is professionally irresponsible to take on a case when you do not have the time to devote to it or the expertise to handle it. Realtors like to say that they are "professionals". Shouldn't your Realtor be held to a similar standard and handle only the number of listings that he or she can effectively service at one time.

A lot of people may know a star Realtor by name. They think the star Realtor has a lot of "buyers" in his pocket. Heck, he has pocket listings so he must have pocket buyers as well. That is why he is such a success, a star. Some buyers think that their particular property is so special that only a star Realtor can list their special property. I wrote an item on Home Ego-Nomics CLICK HERE. Read it. It is fun and so true.

If a star Realtor has lots of buyers, why would he steer his buyers towards one particular property over another? Let's say that star Realtor has has 20 single family homes in Old Town in good locations that are priced between $1.5 to $2 million. If you are the Seller what makes you think a star Realtor is going to bring you a buyer over any other similarly priced and located listing?

I have mentioned that I am a licensed Colorado attorney but not licensed in Florida. I remember when I was practicing law and had a case against some young lawyer with one case. Lawyers with one client can make your life hell if you have two or more clients. Or 60. They have nothing better to do than be really good at that one case. Maybe even "win" it. I think that analogy can transfer over to listing and selling real estate. Of course, the Realtor with only a few listings has to really work the listings to be effective.

Here is another real life example: There is a large Old Town property in a good location that has been on the market for over 2.5 years. It was listed with 3 different Realtors until another agent in our office got the listing a couple of months back. He did the drill that I mentioned above. Then he went out and found a buyer for it. He had the property under contract to a local buyer within the first month. He listed the property at the same price they had it listed. He sold it. Within the first month.

If you are thinking of selling your home or business please consider using a Realtor that can devote the time and attention to selling your individual property.

Florida Keys Dream House

You know how you don't listen to commercials until something strikes your interest, and then you scramble to remember what you heard. That happened yesterday as I was watching HGTV. There was a brief announcement about New Year's Day and the Florida Keys Dream House. To the computer I flew. Sure enough, HGTC built a dream house down here and I didn't even know about it. Of course, they built it in the wrong place.

Islamorda, Florida is located about 80 miles north of Key West (Paradise)on U.S.1. Former President Bush and lots of rich folk go there to fish. Big fishing place. Not much else to do, however. Lots of very expensive homes located directly on the water, however. And lots of houses with their pools and outdoor dining areas covered with screens to prevent being eaten alive by mosquitoes. That's a problem in lots of parts of Florida, but not Key West. We have an army and an air force (no exaggeration) that keeps the little creeps at bay.

CLICK HERE to see more pics of the really nice dream house that HGTV built. Watch the show. Enter to win. Be careful, you may win and get to pay taxes on it. And be stuck owning a very expensive home in the wrong location.

There is nothing to do anywhere between Key West and South Beach. Nothing. Everybody comes here to live. People may sleep and eat up the Keys, but they come down here to live. So don't make a $2 million mistake or even a $300,000 mistake. Key West is where you want to live your life. You know it.

Every week I create a flyer of homes priced under $899,000 that I place outside our office. There are a lot of very creative people in Key West and I will be you that you could buy a nice house in a good Old Town location priced under $899,000 and create your own Dream House that would out-do the one located up Islamorda way. Location is one of the most important things to consider when buying real estate. HGTV got it wrong. You could get it right. By the way, the photo to the right is of the HGTV Dream House. The other photo is in Key West. Just so you don't think that scene is up there. It isn't.

CLICK HERE for the list of "affordable" single family homes in Key West priced under $899,000. Then give me a call to schedule your own personal showing 1-305-766-2642. Your house may not end up being as pricey or as prissy as the HGTV Dream House, but it can be your Dream Come True.

1418 Leon Street

Just Listed: 1418 Leon Street, Key West, Fl. Offered at only $3.6 million or $1,161 per sq ft.

If you aren't familiar with Key West, and maybe even if you are, you may not know where Leon Street is located. So CLICK HERE. The house is located one block east of White and one block north of Flagler. So it is near the Casa Marina area, but not quite there. The area homes are predominantly mid century and have been renovated into larger and more usable living spaces for today's lifestyles. The streets are broad and tree lined, and most of the yards are fenced and gated in the front, sides, and rear for privacy.

The house boasts outstanding architecture and has spectacular garden views from the widows walk of this elegant four bedroom home. Marble floored entry, 30' living room, 10' ceilings, and connecting dining/living porch that overlooks tropical gardens, flagstone terraces, pool and waterfall. State of the art kitchen including wine cooler and walk in pantry. There is a charming dormered room that may be suitable for another bedroom/bath, office or gym. The master suite has 12' vaulted ceilings, walk in closet and glorious master bath. Car parking for two. The house is very large by Key West standards (3100 sq ft) and sits on a 6335 sq ft lot. CLICK HERE for more info and additional photos.

This is not my listing, but I was in the house in mid October. The owner is a local architect who has done several notable projects in Key West. One of the workmen told me that the owner is a stickler for perfection. He actually put in another way, but I'll not repeat what he said.

If this particular home is outside of your present residential requirements but you are looking for a place to live in Paradise, CLICK HERE to search the Key West mls database. Then give me a call so I can help you find your new pad. 1-305-766-2642 or email me at kw1101v@aol.com.