Where we are in the current real estate cycle

MarketWatch.com published a great article speaking into why now may be a good time to buy real estate.

The bottom of the market is not a date, but a band of time or season,” Shore says, and therefore what constitutes the bottom for the entire country is meaningless for those looking to buy and sell homes in their own communities. “If you sit on the fence and wait for the absolute best deal, you could end up literally waiting for years. And most likely, your guess on market timing would be wrong. But if you choose to buy now, you will not only be in the driver’s seat during the buying process, you will also reap the gains of price appreciation once you become a home owner,” adds Shore.

Waiting for the right time to buy puts you at risk of missing it and getting caught in a market on the upswing. Plus, for some first-time buyers, owning simply makes better economic sense than renting. In such areas as Los Angeles, rents are getting close or surpassing a mortgage payment. And you don’t receive any tax benefits from paying rent, nor do you accumulate any price appreciation, as you would if you owned a home of your own.

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Photos from You – The Beach, Sunsets, and More

Every week we’ll feature photos from you, the reader, of anything from crowded streets at Pier Park, to finger crabs scurrying across the beach. They say pictures are worth a thousand words, share your words with pcbdaily.com.

Submitted by Freda Kinner

Submitted by Nina Dodson

Pink Sunset from Sunbird Condos

Chairs a’waiting in front of Sunbird.

Submitted by Andrea Boutwell-Hess

Taken at St. Andrews Park Place – Goin’ to the beach.

Beach sunset from a Sunbird Condo balcony

Submitted by R.O. Smith

Double Rainbow at Deep Water Point

Submitted by Thomas Turner

35 Condos Sold at Ocean Reef Auction

Expectations were high, and so was the attendance. After the wildly successful Palazzo auction, many came interested in seeing “where the market was”, and many more came to have an opportunity at getting a good deal. At the end, many agreed that the market was at the bottom and that prices wouldn’t come down much more, if any, from this number. On the other hand, many more still agreed that the market still has some room for correction.

There was an estimated 400 in attendance with 126 registered bidders from 17 states and 2 countries. When asked at the beginning who was from Panama City Beach, few raised their hands indicating this type of selling forum definitely attracts out-of-towners.

“I was wanting to move back to the states in 2006, but the prices were way too high, this may be my chance to come back, ” said Jerry from the Dominican Republic before the auction hoping to get a good deal.

“I’m hoping to get in at around $140,000 to $150,000 on a two bedroom,” said one local agent, who was also a registered bidder, “I won’t go much higher than $150,000.”

Before the auction began, the energy was great. There were people everywhere with not one empty seat and many people standing anywhere they could find an unoccupied piece of concrete. Bidder packets were being shuffled, pads were being prepared for note taking, and calculators were at the ready.

“You have to factor in the 10% buyers premium in all price per square foot calculations,” said one bidder, “the final auction price, is not the final sold price.”

The auction started with the 4 bedroom configuration on the block at an ambitious $500,000 that was quickly corrected to $300,000. The first bid came in at $310,000. The first 4 bedroom condo sold for $340,000, $374,000 after the buyer’s premium, or $233.75 per square foot.

“That number has got to come down, there’s no way all of them will sell at that price,” said the guy sitting next to me.

The very next condo was started at $310,000. After no bids, a member in the audience yelled “$305,000.” Two minutes later, the feeding frenzy started. $305,000 was the magic number, with 8 four-bedroom 1,600 square foot condos selling at that price. After the 10% buyer’s premium, the final price was $335,500, or $209.69 per square foot.

The two bedroom, 1,146 square foot condos were next. Talking around, this was the most desirable size. The majority of the buyers were price-point buyers, wanting to get in for as little as possible.

The two bedroom auction started at $300,000, was brought down to $225,000, then $210,000, then $205,000 – SOLD! The magic number for the two bedroom configuration was $205,000, $225,500 after the buyer’s premium or $196.77 per square foot. 16 two bedroom condos were sold for $205,000.

Including the pre-sold condos, all-in-all, 35 condos were sold generating an estimated $8.839 million. Initially, the developer offered 31 condos for sale.

After the price was set at $205,000 for the two bedroom, the auctioneers said the developer wouldn’t sell for less than that. At this announcement, approximately half the audience rose from their seat to exit. The line for those wanting their deposit checks back crossed the entire length of the pavement. Many were disappointed that not all of the condos were sold like a true auction, many didn’t want to pay more than their targeted $140k-$150k price range, and still others understood, but were still looking for a sweeter deal.

The real question here is whether we are at bottom. The sold price at Ocean Reef was less than Palazzo, but many agreed that Palazzo was nicer and justified the higher price.

One thing is for sure, if you are a developer and you want to dump some condos, auction seems to be a good choice. “Panama City has turned out to be an incredible market for condos. This clearly demonstrates the pent-up demand and shows that there’s no reason for condo developers to sit on unsold inventory when they can be sold efficiently and quickly by auction,” said William Bone, President of National Auction Group.

How to rent your vacation home…without losing your mind

As vacation rental property owners, we have gradually learned the importance of mixing exceptional hospitality with a good measure of common sense. It is generally the goal of any vacation rental owner to provide their guests with comfort, affordability and a place of respite. Isn’t that what we all need from time to time? My aim in this article is to provide new or struggling property owners with suggestions on what floats the boats of potential guests.

When my husband and I first entered into this business, we were what you’d call rental property virgins. Oh yeah, we’d rented vacation homes or condos from the Bahamas to Maui, but we had nothing to prepare us for this new journey. Our curriculum was hours of Internet research and “Googling”.

Our quest began with a visit to Panama City Beach, where we stayed at some relatives’ home, about three blocks from the beach. For months before our trip to Florida, I began to contact several real estate agents. Not an easy task when you’re doing it from your home in the Midwest. But we muddled through. This California native was beach-starved and I wasn’t going to let 800+ miles stand in my way of the beach dream. Then we narrowed our real estate agent list down to one we enjoyed working with. We also printed out listings and photos, and trimmed down our shopping list of homes.

Location, location, location! Although we desired an actual single family dwelling on the beach, our budget limited our search to beachfront condos. So letting our agents know our price range, this helped narrow our search considerably. To make a long story short, hours of condo shopping resulted in finding our dream condo. We now owned a ground floor, beachfront condo on the quiet west end of Panama City Beach. I prefer a view closer to the ground as I’m agoraphobic (fear of heights) and I hate using an elevator. I have no aversion to using stairs, but I already use them at home. So I figured why not provide my older guests and those with young children with nosebleed-free accommodations. Nothing beats stepping right onto the sand from your patio. I thought I’d died and gone to heaven. We returned a month later to close on our property, refurnished, and enjoy our first week as condo owners. That was the easy part!

We always knew we’d eventually run the business without the help of an agency, but we needed some guidance to get our feet wet (no pun intended). For the first couple of months, we used a rental agency while we figured out what we were doing. We knew we’d need to secure reliable housekeepers, obtain vacation rental web sites to list our property, and work our property into a successful business. Well, at least try to get it to pay its own bills. When we were ready, we learned that it was actually easier, for us. I won’t claim it’s easier for everyone. But since we only own one condo, it was a no-brainer.

I cannot stress enough how important record keeping is in this business. You must record every transaction relating to your business. Every loss, gain and receipt must be meticulously recorded…right down to the housekeeper fees, bed tax collected, and heaven forbid, stolen towels! By the way, we’ve only had spices removed! So find yourself a good spreadsheet template. Also, keep good records of your correspondence and emails with your guests, inquiries, housekeeping and maintenance staff. You are more likely to enjoy repeat guests if clear and friendly conversations exist between you.

I have made it a habit to contact my inquirers immediately (within that day). They are usually impressed that I took the time to get back to them. Some never get back to me even after I take the time to call or email them. But I figure, hey, it’s their loss! By the way, every email I receive from potential guests, whether they rent or not, get filed. I try to reconnect with them for the following season, or when I run specials. Never underestimate what an invitation to bookmark your listing site for future rentals can do for your business. Repeat guests can eventually become your bread and butter. This year we’ve enjoyed about 90 percent occupancy. There are other factors to contribute to this phenomenon.

Provide your guests with all the creature comforts. Upgrade your cable programming to HD and furnish the nicest high def television you can afford. Prices have really dropped as resolution and contrast ratio have risen. For the living room, a 40” to 52” LCD does nicely. However, be sure to put locks on pay-per-view. Also, it would behoove you to have a smaller HD LCD in the bedroom, instead of a bulky tube TV. The LCDs run cooler and do not attract as much dust. Also, provide DVD players in the living room as well as the master bedroom. If you have extra DVDs lying around, stock a few for your guests. Provide movies for younger guests. Mark them clearly and keep an inventory.

For the basic price of combining local phone service with DSL, the rewards are obvious. I’ve rarely had guests that didn’t need it or use it. Many ask for it and prospects just may choose your rental over another that doesn’t provide Internet service.

I cannot stress enough how important a good housekeeper is. Find one that has a spotless reputation, great references, flexible, has great attention to detail. Your housekeeper deserves to have good communication with you, for schedules, expectations, prompt payment and a good working relationship. She/he can make or break your business. Keep them happy and everyone wins.

Keep your rental like you would your home. Not only will it feel more like home for your guests, they will tend to respect it more. Provide plenty of linens and first-day amenities such as little soaps, TP, tea, spices, etc., will remind them they are not in a mere hotel. Little touches like bedtime mints, champagne for newlyweds, even a couple of loads of dishwasher soap will make them yearn to return.

A comfortable bed that they don’t want to get out of is sure to bring your guests back. Don’t scrimp on comfort here. A sturdy mattress will last years longer than one from a discount store. Do provide moisture-proof anti-microbial pillow and mattress covers. Let your guests know this, as it will ensure them that you have their health and comfort at the top of your list.

Keep your appliances updated and good working order. If you buy new, get extended warranties. I guarantee it will be worth it, and it’s tax deductible. Provide your guests with tips and information on how to use them. High efficiency front loading washers use only HE (low sudsing) detergent. Remind them to keep the lint traps clean on your dryer. Provide coffee filters! They are cheap, and even if you don’t provide coffee (which can go stale anyway), your guests will appreciate not having to buy filters.

It’s nice to keep a broom and dustpans, bagless vacuum and some cleaning supplies available for your guests to use. Some may never use them; after all, they are on vacation! But then you may have guests like myself, A-types that can stand to see dust or sand on the floor. My housekeepers are always delighted to walk into a recently vacated unit that was sparkling clean. It can happen!

When the deal is closed and your guests have only weeks until they arrive, be sure to send them receipts for payment, email to print out of what you expect of them, how to check in and out, how to get keys, times, phone numbers and anything else that will make their arrival and departure as smooth as silk. Encourage your guests to sign a guestbook. Others will enjoy reading pages of kudos and you can write their entries into the much-forgotten online guestbook!

Every January, I create a letter to email all my contacts, whether they actually stayed or just inquired. Then I write them and invite them to check our web sites to start planning their next vacation. I remind them to book early, especially for peak times like March through the end of September. Guests that you expect to return will appreciate the reminder. If you prefer not to rent to college age guests, and we strictly avoid this, do be cordial and diplomatic when emailing them back. Firmly remind them of your policy but don’t burn the bridge. Let them know to share your link with their parents, should they be shopping around for great accommodations. A little diplomacy may lead to a booking you didn’t expect.

Lastly, I’d encourage rental owners to remember what it is like to be on the other side of the door. Treat your guests as you would like to be treated. Do for them what you can afford, try to break even, and try to enjoy your vacation home yourself when you can. We’ve developed some great relationships with our renters. The dividends will be great new friendships and happy memories for all. Have fun with it and many happy returns!

Condo Auction Today at Ocean Reef

Get your checkbooks ready, because there is sure to be some good deals to be had today.

At 11 am, Ocean Reef Condominiums will be putting 31 beachfront condos on the auction block. National Auction Group, the same auction company that sold 50 condos at Palazzo August 2nd of this year, will be putting on the show onsite.

With over 63 to choose from, 31 will sell regardless of price. The sizes up for auction are either 2 or 4 bedroom configurations ranging in square feet from 1,100 to 1,600.

Registration will start at 9 am with the auction to begin at 11 am.

Get Live Auction Updates

I will be in attendance, and for those of you that can’t make it, I will be sending live updates to all of you that are “following” pcbdaily on Twitter. The way it will work is that I’ll be “texting” my Twitter account from my cell phone updates on prices sold per square foot and any other exciting information happening at the auction. When I do this, everyone that is “following” pcbdaily on Twitter will be notified of the updates. When you sign up on Twitter, you can set up a cell phone on your account to be notified automatically whenever I submit any updates to my Twitter page (you can turn this feature on and off at will, actually), or you can set up to be notified by email. You can also see pcbdaily’s Twitter updates in the sidebar of the website under the heading “Twitter”.

Click here for a full list of auction terms, etc.

Constant Motion

I realize this is not a “nature photo” per se, but it certainly speaks to the pure joy and exhilaration children have when hunting for shells on our beautiful beach.

Good friends of our’s came down from Oklahoma for the weekend with their children. We took them to visit Shell Island where I did a serious of action shots featuring these two bundles of energy. The north wind had knocked the waves down on the Gulf side of Shell Island giving us an extremely calm day to frolic in the surf.

Not much is more fun as a photographer than watching a two and three year old hunting for shells. These two were literally in constant motion running back and forth to their Mom with each new shell find. Little did it matter to them wither the shells were broken or in perfect condition… it was a true treasure in either case.

We could all learn something from these two. This beach is a treasure that we locals all too often take for granted. Visit my blog to see more of these photos.

Teddy

Boo in the Park – Pier Park, that is.

Ghoulish ghouls and creepy crawlies should be expected at Pier Park on October 25th for the first annual Boo in the Park at Pier Park in Panama City Beach. In partnership with the Visual Arts Center of Panama City, Pier Park will bring spooky stories, and arts and crafts for the kids.

From 10 am to 4 pm, visitors can wander the hay-bale maze, and kids can explore the Panama City Beach Mosquito Helicopter. Audiences will be dazzled by performances by the Rosenwald Cheerleaders, Arnold High School Choir and the Bay Haven Chorus.

From 1 to 3 pm, Magic Broadcasting will feature live radio remotes at various locations in Pier Park.

In celebration of the Halloween holiday, the Visual Arts Center will install the commemorative hand-painted children’s tiles.

Resort Collection Educates the Tourism Industry

This has been discussed in the past, and the Resort Collection of Panama City Beach has taken the lead in paving the way to provide education to those involved in the tourism industry in our area.

“This is an opportunity to raise the bar among our employees and give them the tools to reach and exceed the expectations of our visitors.” Said Tom Sparks, general manager of The Resort Collection, “We are proud to be the leading hospitality organization in this program, it is our commitment to make Panama City Beach the premier destination of Northwest Florida Gulf Coast.”

By instilling some form of formal training for employees of the local tourism industry, a standard can be easily set for what is expected in order create a great customer experience for tourist of Panama City Beach.

The Resort Collection of Panama City Beach has partnered with Gulf Coast Community College (GCCC) to create the first of its kind hospitality education program for Bay County.

During a planning session last week, members of The Resort Collection and GCCC laid the foundation of what will become the Hospitality Corporate Culture training and education program.

This twenty hour course which is part of the college’s Lifelong Learning department, will provide the hospitality and tourism businesses in our community with a consistent industry wide training program to increase customer service standards and the customer’s experience while visiting our destination.

This Hospitality Corporate Culture program will officially launch before the end of the year. Sparks said, “The program will be open to employees at all levels of the hospitality industry and will prepare us to better serve our domestic and international travelers as our destination grows.”

The program is being facilitated and managed by John Hamati, president of Vie Hospitality LLC. Hamati has a successful history in the hospitality business and has helped create this initiative to fill the gaps in local training.

“The Hospitality Training Program has been a hot topic for the Greater Panama City Beach Chamber of Commerce and for Gulf Coast Community College for over two years now. Finally, with the assistance of the Edgewater Beach and Golf Resort, The Resort Collection along with Gulf Coast Community College, we are now able to launch this new training in Panama City Beach.” Said Hamati, “we thank Tom Sparks, general manager of the Resort Collection, and the Edgewater Beach and Golf Resort team as well as Gulf Coast Community College in stepping forward and making this training a reality.”

Now, Back to Regularly Scheduled Bashing

Notes from Today’s TDC Meeting

Bed Taxes are up $117,000 thanks to back-taxes being collected.
The Circus by the Sea is more than likely coming back. Maybe it will draw more crowds next year.
The CVB has a new interactive marketing manager coming on board.
Rowe distributed estimates of costs of strategic plan proposals to board. I’ll be asking for copies of those to post here soon.
Mayor Gayle Oberst explained that Panama City Beach could not use bed taxes to fund lifeguards. As one Marketing Committee member told me later, it’s a good thing we’re smarter than Walton county on that issue. I have a lifeguard manifesto brewing; I’m sure it’ll come out any day now.
The TDC’s market research firm, Klages, is up for contract renewal, and the board showed concern that the 2008 results were not worth the investment. Tabled. Marketing Research, tabled.

Now to the juicy stuff…

Spring Break is heating up quickly… Spring Break funding was tabled after Dan Rowe requested approval on the MTVu plan ($150K CVB, $100K co-op).

Chairman Andy Phillips and Marketing Committee Chairman Buddy Wilkes questioned whether the co-op could really raise $100K. Mr. Rowe believes so; however lodging leaders stepped up quickly and said that because of the exclusive booking deal MTVu has with Student City, they would not participate in that co-op.

Board member Mike Bennett suggests the funding should go into a different Spring Break program. Dan Rowe suggested that if it’s not MTVu, then put the money in something other than Spring Break. Jack Bishop said the Klages report proved the CVB should invest the $150,000 into Spring Break. (It’s getting good!)

Folks in the audience suggested that only the Boardwalk benefited from the 2008 Spring Break plan. (It’s really getting good!)

There was a hint that there may be another Spring Break community workshop. The marketing committee will address the issue before the next TDC meeting on November 6. (Don’t you think this is going to get good!?)

And More Utter Disregard for the Special Event Policy

The Board unanimously approved 2009 funding for the Panama City Beach Seafood, Wine, & Music Festival. Wow. Wasn’t even on the agenda.

Special Event Side Note – Do you realize that 3.25 million dollars worth of lodging has to be brought in to raise $65K in bed taxes?

If PCBSWMF would have reported the need for $65,000 invested in the infrastructure at Frank Brown Park for next year’s event, that would be different. PCBSWMF Promoter Jack Bishop stated that the event could not serve 30,000 attendees as reported by previous promoters. Hopefully PCBSWMF will use all $65K to improve the infrastructure. We’ll see.

Speaking of we’ll see, we’ll see the full PCBSWMF report next month. Hopefully that report will include exactly how and where the 2008 TDC investment was spent.

In the meantime, we sure would like to have other promoters comment here with your thoughts on the TDC’s Special Events “Policy.”

If I misinterpreted anyone’s comments from today’s meeting, please email me at lancaster.kirk@gmail.com, or even better yet, clarify your message right here in the comments section.

New Airport Terminal Ready for Construction

As reported by NewPCAirport.com.

Construction of the new airport remains ahead of schedule – with only 36% of the time allotted on the heavy civil construction portion of the contract used, the project is currently 46% complete.

Walbridge, the company slated to build the terminal building and all support buildings is scheduled to be on site by October 20.

Preparation of the terminal building pad is complete and it is ready for construction to begin. Walbridge is just waiting on the Notice to Proceed from the Airport Authority Board which is expected on October 15, 2008.

The project is moving forward on all fronts. Currently:

The stabilized sub grad for the terminal parking lot area is complete, the curbing for the lot is ongoing and the limerock base is nearly 60% complete.

Curbing on the loop road is ongoing.

The General Aviation area access road is being final graded.

The flight line storm sewer is 85% complete.

On Runway 16-34, the asphalt base layer was scheduled to start going down on October 10, 2008. Concrete paving on the runway is expected to begin on November 11, 2008.

The earthwork on Taxiway D is 97% complete, with the stabilized sub grade 65% complete. The limerock base is nearing 50% completion. Asphalt paving is anticipated to start October 10, 2008.

The security fence around the perimeter of the airport is 46% complete.

Earthwork on the perimeter road is nearing 85% completion and the stabilization of the sub grade is ongoing.