When Time Matters

WHEN TIME MATTERS

“You may delay, but time will not.”

Benjamin Franklin

In our continuing series of “When Time Matters,” this article discusses how individuals on fixed incomes experience significant challenges attempting to sell their homes in tight markets, which are exacerbated by increasing insurance and Home Owners Association (HOA) fees and expenses.

The United States has seen some dramatic increases in the cost of home ownership due to geographic areas prone to natural disasters such as hurricanes in the eastern part of our country, tornados in the midsection and wildfires in the west.

A perfect example of this is in Florida where homeowners’ insurance costs increased last year by an average 40% while 1 out of 8 were dropped all together. Florida homeowners already were paying significantly more than the national average, but after Hurricane Ian they are now paying four times the national average according to a survey conducted for the Florida State Legislative Committee.? One can only imagine the impact Hurricane Helene will have.

These increased insurance costs are especially challenging in condominium complexes where HOA fees (HOA fees are maintenance expenses required by shared housing developments that go toward building repairs, staff and amenities like pools, etc.) increased by an average of 15% in 2023.? Additionally, as a result of the legislation passed after the tragic collapse of the Surfside Condominium Complex, north of Miami, in 2021, inspections are now required with reserves set aside for repairs.? Compliance with the reality of increased insurance expenses and new regulations have led to assessments in some cases exceeding six figures.

Although Florida is the “model child” for these significant increases, it is hardly alone.? Recent industry surveys show HOA fees rising in the states of Texas, California and Georgia, to name three, by similar amounts.? Additionally, insurance costs have soared throughout the nation due partly to inflationary costs of repair and replacement, but according to S&P’s Tim Zawacki in a recent NPR interview, there were nearly two dozen billion-dollar storms touching many parts of the country last year.

These fees are hitting seniors especially hard.? Many of whom can no longer afford these expenses and now are being forced to move.? Needless to say, with all of these competing challenges, the available inventory has dramatically increased resulting in a significant decrease in market value.

For individuals on fixed incomes these predicaments place sellers in circumstances where “time matters.”? For many, a real estate auction may be their best solution.? A professionally managed auction marketing campaign can ensure exposure to serious buyers, competitive bidding and closure with terms dictated by the seller.? The auction methodology allows the seller to set the date, time, place and conditions.? Whereas traditional sales processes can take months, with buyers often dictating the terms, leaving sellers continuing to feel the squeeze of their financial burden.? Alternatively, a professional auction marketing campaign can attract cash buyers with the financial capacity to comply with the sellers terms and needs.

Real estate auctions are not always the appropriate strategy in all circumstances.? Lack of equity, clouds on title or steep assessments can necessitate a thorough analysis as to the appropriate plan of action.? However, when time matters, the counsel of a professional real estate auctioneer should be an essential part of the strategic discussion.

Tom Saturley, CAI

Chair

Tranzon Driggers

Ft Myers, FL