Propy Webinar #151: The Real Estate Market: Where Are We Headed?
Kirsten Heslop, Account Executive at Propy Title is joined by Samiyah Ali, Managing Broker/Founder, Global Premier Real Estate Agency of Lake Mary, FL to discuss current market conditions, and where the market is headed in the next year. Also discussed are key benefits to buying real estate now, even though interest rates are still high.
As Samiyah watched the changes happening during the pandemic with relocations to Florida increasing rapidly, she saw an opportunity to help people from all over the world to invest in homeownership, and Global Premier Real Estate Agency was launched. The brokerage is located in Lake Mary, which is about 20-30 minutes outside of Orlando.
Learning to pivot with the market changes
Over the 16 years that Samiyah has been in the real estate industry, and especially over the past three years, she has seen a lot of changes in the market. The key to being able to remain nimble with those changes is to stay educated and involved with the industry. Samiyah also focuses on staying connected to the people who are the top resources for her to connect to her buyers and sellers.
Keeping up to date on the market
A large part of staying up to date on the market is being aware of the news and being educated about what the market is doing. To stay in the know, Samiyah follows Lawrence Yun, the Chief Economist for the National Association of REALTORS®. He gives excellent insights into the market. Barry Habib also provides solid advice about the economy and the real estate market.
Samiyah explains that a lot of how someone views the market has to do with their personal situation. Real estate is never a cookie cutter transaction, and every client brings their own nuances to the transaction. Income, education level, and where people want to live all factor in to how that person views the homeownership route. Because of those factors, she strives to give an individual approach.
For example, she hears a lot of conversations about interest rates, and many potential buyers say it’s cheaper for them to rent now. Renters generally don’t think about what kind of interest rate they’re getting when they are leasing a property, or the fact that their landlord can increase their rent monthly if that is written into the lease.
Another challenge with renting is the landlord may decide that they want to use that property for their college-bound child to live in for the four years they are at school, for example. In a situation like that, the tenant must move through no fault of their own, and that creates instability in their life.
The benefits of homeownership
It’s costly for renters to keep moving, and it takes time to get settled into a new property. For people on the fence about buying, she stresses that homeownership provides stability as you build equity. There are tax breaks available when you own a home, and if you decide you don’t want to live in that property any longer, you can rent it out and have a passive income stream with tax write offs. There are many different benefits to homeownership.
Lack of inventory, higher home prices, and the increased interest rates may mean that a buyer won’t be able to afford to move at this time, or that the only thing they can afford is a smaller home than they currently live in. In that situation, it may not be worth it to them to move. Samiyah says that her role as a real estate professional is to bring solutions to make sense of all of this. It’s important to think outside the box so you can figure out what is needed for a successful outcome and peace of mind for your clients.
Of course, there are always home repairs that need to be done, insurance premiums can increase, and inflation drives prices up. While those things may not be in your control, you can plan for them. You can manage your home using a system to handle monthly upkeep, no different than getting your hair cut on a regular schedule or having a plan for maintaining your car.
The growing Florida market
The market in Florida continues to be hot, and Samiyah is still seeing a lot of relocation activity in her area. With great weather, no state tax, and a reasonable price range, she expects this trend to continue. Inventory remains low, so she must be the solution finder for her clients.
Why buying a home is still a good idea despite higher interest rates
Many people are focused on the interest rates going up to 6 and 7 percent, but Samiyah wants people to remember that in 1971, the rates were 18%, so it has been much worse than it currently is in terms of rates. She believes that being able to have a fixed payment during the time you own a property is a benefit for homeowners. There is always the option of refinancing when interest rates drop again. For first time homebuyers, she stresses they put together a budget and look at their credit report to deal with any problems that may show up. Setting up a savings plan and developing discipline with your finances will help new homeowners have a plan in place for repairs or unexpected expenses.
Owning a home provides a legacy for a family should the owner pass away. If the heir to that property doesn’t want to keep the home, they are able to sell it and benefit from the property in that way.
The top five hottest places to move to in Florida
The Central Florida, Orlando area, including Lake Mary are high on the list of places to move to in Florida because of all the attractions surrounding Disney. She says that frequently people come for a vacation at Disney, stay in an Airbnb, and then start thinking “what if we owned a house like this?”
Other popular cities with hot markets are Miami, Tampa, Jacksonville, and Gainesville. These cities all are seeing a lot of new home developments being built. One indicator that Samiyah watches for is when an area is breaking ground to add new highways, Walmart or Target stores. This is always a sign that new homes are coming, and this is typically a great place for someone to get started with their homeownership journey.
The US and global market
“Global is it. The US is a big melting pot,” Samiyah explains, “So whoever is here, they would like to have their family come to the US. There are also a lot of exchange students coming to the US, and frequently that family will want to relocate to be close to their child.”
She also sees that more international people find the process of transacting real estate to be safer and easier to do in the US, and so Samiyah is seeing more people migrating to the US for investments.
Kirsten adds that as she talks with people who live outside of the US, they share that buying real estate is not necessarily that accessible in their country. Propy’s platform is opening up doors and providing opportunities for international buyers to create generational wealth.
The benefits of being Crypto certified
Samiyah is a Propy Crypto Certified Agent, and she has also taken the Meta Agent course. She sees this as the future, and believes that understanding crypto, the metaverse, and knowing how to transact with NFTs will allow her to talk with younger buyers in a language that they gravitate towards. She sees us headed toward a time when people may not use money like we do today, but instead will be doing wallet-to-wallet transactions. This has opened a new world for Samiyah, and while she doesn’t know when this future will arrive, she knows there is an opportunity here that she wants to be part of.
How crypto, blockchain and novel technologies will change real estate in the future
Samiyah believes that in the future, as we become more accustomed to using crypto, owning NFTs, and recording on blockchain, we will be able to purchase properties quickly by scanning from our smartphones. The information about a property will be recorded on the blockchain, making it trusted and easily accessible to the buyer.
The next 6-12 months
The next year in real estate is about being resourceful and staying educated in the best ways to transact real estate because “someone is always buying, and someone has to live somewhere. No matter what happens with the market, you must live somewhere.”
Samiyah explains that there’s so many ways to use real estate that when you’re buying, you need to look at what the reason you’re buying is to see if there’s value there. For example, you may be thinking of buying a rental property, but the market’s up and the property is more expensive. When you do your analysis on the property, you may discover that because it’s in a hot area, you can get positive cash flow by putting it on Airbnb, then that is a benefit to purchase that property.
In terms of inventory, Samiyah expects that available properties in her area will continue to be sold quickly under multiple offers. She states that it’s important to have what she refers to as a solution checklist that covers different situations to best be able to serve your clients. When someone is a buyer, she needs to know where they are in their finances to discover where they fit in purchasing. Knowing that someone is buying their first home, a dream home, or a luxury property tells her a lot about where that buyer is in the buying process. Knowing someone plans to purchase using cryptocurrency tells her that she needs to find the right resources to plug that person into.
Additionally, there will be a reset during the coming twelve months for people who have been on deferment plans due to the pandemic.
Advice for buyers and sellers
Samiyah’s first piece of advice is to stay positive. She finds that whatever energy you put out there will come back to you, so keep it positive.
Secondly, if you own a property, make sure you are keeping it well maintained. If you don’t and you are selling it, the buyer is going to see those problems and wonder what other problems are there that they can’t see.
Finally, she recommends that you always work with a professional, because that person will advise you the right way to get the best results.
Connecting with Samiyah on social media:
- Website: gphomeconnection.com
- Instagram: @samiyahthebroker
- Facebook: @samiyahalirealtor
- Twitter: @SamiyahtheBroker