C. Wallace Hume is a Realtor at Century 21 1st Class Realty in Sunny Isles.
Every week, we ask a Miami real estate professional for their thoughts on the top three stories from the week before. This week, we spoke with C. Wallace Hume, a Realtor with Century 21 First Class Realty.
Miami Agent (MA): On of our recent features discussed how to effectively manage a Twitter feed, which is becoming an increasingly popular marketing medium in the real estate arena. Have you bought in to the use of social media in real estate, and, if so, how are you using it?
C. Wallace Hume (CWH): Social media is an important part of any marketing program for promoting any type of product or service. For real estate, agents are promoting a service (their skill in finding a good property for clients and helping clients sell properties) and a product (the properties they have for sale or rent).
Facebook is the most widely used, and an agent should have a facebook page just for real estate. It is not a good idea to integrate your real estate business into your personal facebook page, as it is more professional and less annoying for your friends to have a separate page just for real estate.
As for Twitter, it is the second most used form of social media by real estate agents. The idea with Twitter is to get followers who want to hear what you have to say. I do not yet have a Twitter account, but I will soon. What I will be tweeting about is the next big thing – like Samsung! I have a lot of friends at Related, Cervera, ISG; a lot of the companies that get the sales contracts for new projects. I usually know about new projects in advance of other realtors, and of the general public. So what I will be tweeting about is new projects. Something like: “Historic Surf Club in Surfside, sells club to real estate developer” or “Forte developers acquire the Surf Club in Surfside.” Tweets, like “I just showed a family this fabulous 4 bedroom 3 bath house in Coral Gables today” have little value. No one cares about what you did. People care about interesting news you have for them, and that is why they follow you on Twitter. So my advice to agents is Twitter is not your diary or a recap of your daily schedule. Twitter is used to give valuable information to your followers.
MA: The Miami Association of Realtors and the local Multiple Listing Service recently released data suggesting the local market was moving closer to a buyer-seller balance, specifically citing increases to average sale price and decreases in the number of days a listing stays on the market. Have you witnessed this shift away from a complete seller’s market and, if so, do you think the trends are sustainable?
CWH: As long at there continues to be low inventory in every market and sub-market, combined with the influx of foreign cash, it will continue to be a seller’s market. It was predicted by some that there were many more foreclosures to come to market once the bank released them; but this has not been the case, and the foreclosure market has almost dried up. Buyers now realize that there are very few foreclosures on the market and very few good deals. They realize that if they want a nice property, they are going to have to pay market value. Now combine this with the low inventory, and the problem becomes you have many prospective buyers, several of whom realize that they have to pay market value, but there is nothing to buy. This creates a seller’s market, which will continue as long as these two factors are present.
MA: One of our most read articles this week discusses some of the key housing trends as we move past the halfway point of 2014. In the local Miami market, what do you find to be the key trends of this year?
CWH: Not to belabor the point, but high demand and low inventory continue to remain active forces in the market. There are still a tremendous amount of cash buyers. However, many of the people who fell prey to the foreclosure epidemic have now had time to rebuild their credit. Also, many banks are starting to lend to those previously in foreclosure, foreign nationals and on more and more condos. So, in addition to the foreign investors dumping cash into Miami real estate, previous homeowners, who were forced to become renters, are re-entering the market as buyers – creating even more buyers. With the low inventory, this is driving the prices up.
Another huge trend is banks lending to developers again, as well as the plethora of new condo projects being built in Miami. So many it’s hard to keep track of them all! Since they require 50 percent cash deposits, I do not foresee a collapse like the last condo building boom. In my experience, most of those buying the pre-construction projects are foreign nationals with cash that they want to move to the United States. Many of my high-end clients feel that these new projects are over priced, especially if buying for investment only. The clients that I have sold pre-construction projects to will make these condos their primary residence. Thus they are willing to pay top dollar for a customized product, which they will live in and enjoy for themselves and their families.
The rental market is still huge as evident by companies like the Melo Brothers and Pinnacle Group building strictly apartment buildings. In many markets, like Brickell, the rental rates are not commenserate with the salaries, which could be a devastating problem for landlords. Landlords are asking for more and more information from tenants to ensure that their rents will be paid. Reviewing the eviction filings in the coming months and years will determine if in fact the rental rates are too high for locals.
Commercial is a whole other market, but I will touch on it since I do commercial leasing. Basically, properties are leasing much faster (6 months as opposed to years) than in the past 4-5 years. Rates are going up in some sub-markets, like Coral Gables (retail and office space in new buildings) and Doral (warehouses). Many larger spaces continue to sit empty, especially if they are completely unfinished. It is kind of a catch 22, as it is not feasible for the owner to finish the space until he has a tenant, and it is not feasible for a tenant to pay to finish a landlord’s space. The large spaces usually require a large restaurant chain or retail chain, which the landlord is still trying to convince that the market has rebounded enough for them to open another location. I am seeing many new businesses open up in strip centers, particularly smoke shops and vaping shops. This is a topic all unto itself, which would require another article. However, I am quiet versed in these two businesses and would be happy to discuss their business objectives, viability and sustainability with you.