February 2008
Community Paper


And Then Someone Bought A House
by Mike Derenthal, Derenthal Realty Group and College Park resident

Okay, so I was two articles into a three part series on landlording, and this is supposed to be the exciting, thrill ride finale on managing tenants. The good citizens of College Park are no doubt abuzz, camped out in their front yards, waiting for the next issue of Community Paper to land on their drive so they can tear into it, to see what that real estate guy with the large head was going to write.

Well, sorry, but bear with me. Something interesting happened recently that has caused me to unceremoniously pause the landlording series. Something that seemingly hasn’t happened in a long time and is creating a hub-bub.

A young couple bought a house.

Currently, most of my active buyers fall into one of two groups: Investor Buyers and First Time Buyers.

The Investor Buyers have (fortunately) kept us busy in recent months. They love a slow market and love to find motivated sellers. They’ve been patient - picking up deals here and there, and slowly building their portfolio of properties. Time is on their side, and they know that each day that goes by that a home sits in a slow market, the more likely they are to get a screaming deal.

But what about those First Time Buyers? They have been largely in hiding during the second half of ’07, waiting for an obvious signal that a home is once again a safe thing to own. And many are still lying low as we enter ’08. But I’ve noticed a shift among some in this group just in recent weeks. They seem to have grown tired. Tired of waiting. Tired of living with inlaws. Tired of celebrating another Christmas in an apartment. Some of them might have a baby on the way. Others just want a yard they can call their own. Whatever the reason – a select few are starting to venture out and look again. And some are actually putting ink to paper and writing contracts.

Whatever their motivation, I’m getting the sense that a lot of these people have decided that they are less concerned about whether the real estate market will take 6 months or 18 months to get back to normal, and more concerned with getting on with life.

And I think that’s what we’re seeing right now - pent up demand starting to break loose.That in itself isn’t all that interesting. Positive news, yes, but intriguing? Not really. But here’s what is…

Some of my Investor Buyers are getting antsy. They’re starting to realize that other buyers are getting back into the market, and they find it bothersome. I had an Investor Buyer recently get into a bidding war with another buyer on a condo. Seriously.

And that’s what I find so interesting. Watching these minute changes in overall market activity that have an impact on an individual buyer’s motivation and sense of urgency. If you’re thinking about buying something, what’s the hurry when you know it’s not going anywhere? But the minute someone else threatens to buy it first, it suddenly increases in value.

And that race fans, is what this market has been missing – a sense of urgency.

We’ve still got a long way to go. The numbers don’t lie – there is simply too much inventory on the market, and that inventory needs to clear before things get back to normal. And we should anticipate more ups and downs as the market recovers.

But the improvement has to start somewhere.

by: Mike Derenthal, Derenthal Realty, www.DerenthalRealty.com
1520 Edgewater Drive, Suite E, Orlando, FL 32804
407-965-1919

See this month's ad by clicking here