As I write this on June 21, 2019, I can find 4 Sales in Big Canoe for the month of June. We are on track for an approximate 70% year-over-year drop for the month (29 sales in June 2018). But it isn’t just Big Canoe, Real Estate Sales are collapsing all around. I could only find one home sold in Bent Tree so far for the month, and 1 lot in Lake Arrowhead. In a wideview of the Helen / Sautee Nacoochee Market I could find ZERO. June is almost over. Not saying that the month will end this bad – but the data is pointing to a serious and sudden slow down in activity. In another canary-in-the-coal mine datapoint, Florida Foreclosures across that state are up 23% year-over-year. These traditional 2nd home markets (Mountains and Florida) are strong leading indicators of much worse to follow.
I want to provide Big Canoe Home Sellers with some actual data points that they may find useful in determining price points for selling their homes.
I took a random 60 day period in the Spring (April 17 – June 16), and listed the Homes that Sold, and then for the same period I took the data for the Homes that Listed. You can look at the data yourself. I tried to include some additional data such as Address, Square Footage, Property Type (lot vs home) and Bed/Baths so that the numbers could have some additional interpretive value. Two key takeaway points I would make are as follows:
- Listings (Supply) outpaced Sales (Demand) by 70 to 44 during that period (and that inventory ratio is increasing in June)
- The Spread in List Price vs Sale Price was substantial – with many of the higher end homes regularly accepting offers ranging from 16% to 37% off initial List Price.
Disclaimer: These numbers may change very slightly as (occassionally) a property may be added, or deleted, after the fact to datasets. However, great care was taken to accurately reflect data and conditions to the best of my abilities. Also – in SOME cases, the “List” price has been calculated using the “1st List Price”. For instance, a Property Lists at $499K in Spring 2018. In Fall 2018 the Seller gets a different Realtor and lists at $439K. The property eventually sold at $400K. Our data shows the Original List of $499K because the points we are making are in regards to overall market price declines over time. Also – to give evidence that SOME realtors are giving some Very bad pricing advice, telling people what they want to hear. What you need to hear… is factual market data.
Another valid point to make is that the above numbers still don’t accurately reflect the situation, because as we move into June, things have continued to slow considerably. This fact may not be apparent to the general public yet, but that is only because Market Trends and News that filter out to the public is on a 2 month lag of reported data. In April there ws a decent spike upward, but that rapidly evaporated – and yet those April numbers are the basis for data that is being currently released.
Another datapoint I briefly glanced at, but did not take time to prepare a report on, was Drops in Asking Price. Many properties have substantially dropped their List Prices. The old “Prater Log Home” caught my eye, which was once listed pre-2008 for $2,900,000. It’s List Price in April just dropped from $1,850,000 to $1,200,000 – and still not a buyer in sight as far as can be determined. One thing is for certain… the market for these Large, High Priced Homes is on life support – and that is not just Big Canoe – it is everywhere in the region. People wanting/needing to sell these types of homes should start getting ahead of the price curve. Three Big Canoe Homes just gave 33 – 37%+ Listing Price Discounts in order to get them under contract (see the 60 day data sheet for the list of homes sold). If you are a Seller – you need to be demanding some straight talk about market conditions from your Realtor!
Another important indicator is to watch LOT sales. While the fact that Land / Lot sales is dropping off the cliff to almost non-existence, and prices are dropping like a rock, that is not the real point I want to make here. The point I want to make is that LOTS in Big Canoe pay a monthly Assessment of $182 dollars per month, and we count on them for a SUBSTANTIAL portion of our Revenue Budget. This is considerably up from 2008 when I think it was about $110/$120 month. Back then people walked away in droves from their properties – with the much lower holding cost at that time. The counties took ownership of some, as property taxes didn’t get paid. The POA got stuck with more. If you look at my earlier story on the topic, you will see that the Counties and POA are still holding an enormous number of those vacant Lots – none of which are contributing to Assessment Revenue. They are being kept off the market in a basic attempt at market manipulation (don’t want to flood the market with more cheap lots when prices are already low and dropping). My point is that this is NOT the sign of a healthy market – and it is a clear signal of potential future declines in revenue for the community if the current real estate trend holds, and people once again walk away from lots.
Don’t think that can happen? On June 20, 2019 (yesterday) one Property Owner petitioned Dawson County Commissioners to accept his Big Canoe Lot under a donation, because he could not afford the taxes and monthly assessments. If accepted, the monthly Assessments on this LOT will NOT BE PAID, similar to the 25 other properties owned by Pickens County, Dawson County or the POA itself. This is a Revenue Black Hole. The POA is doing nothing about these lots. They are not selling the ones they own, and they are not forcing the Counties to pay the assessments – which ARE legally owed. It’s all artificial market manipulation to keep properties off the market – but it also results in near permanent loss of revenue. Some of these Lots haven’t generated assessment revenue since the 1990’s. I have harped on this for years to no avail.
The main point I am making here…. is that this is NOT the time for our POA Board to be getting us deeper into higher fixed-cost debt – their actions of late already contributing to higher property supply in the community – as people grow frustrated with the aggressive and tone-deaf attitude of the Board/GM – and increasingly put their homes on the market. This POA needs to immediately signal that they are foregoing all their expensive projects, and get rid of our devisive General Manager so that this situation can cool down. It won’t stop the looming global financial trainwreck that is coming – but it may soften the blow for Community Residents and Property Owners.
Now a direct and serious allegation against the General Manager’s Office. I’ve just showed you factual data regarding the market conditions. I do so because factual data matters to people when they are making important decisions – like pricing your home for sale. You need REAL AND ACCURATE data to make informed decisions. The General Manager’s Office has been presenting Property Owners with FALSIFIED MARKET DATA in the monthly Admin Reports, in order to mask the severity of market conditions within Big Canoe.
Jayne Hagan has presented us so many conflicting numbers regarding property sales – it is literally making my head hurt trying to figure out the fact from the fiction. Let us consider the following:
May Board Meeting Video @ 10:03 – (Jayne Hagan Speaking)
“We had 83 property sales through the month of April. 70 homes of which, of those 70, 6 were new homes finished. And we had 13 lots.”
June 2019 Board Meeting Video @ 15:24 – (Jayne Hagan Speaking)
“117 Properties were sold through the end of may. 103 of which were homes. 10 are new homes. And there were 14 lots.”
POINTS:
- The difference in Property Sales between May (117) and April (83) is 34. So according to her statements, they are indicating 34 Property Sales in May 2019.
- My Count shows 22 Property Sales in May.
- I am further aware that some of these “Sales” that they are presenting are some sort of “Refi” or something through the Big Canoe Company – the owners never having changed in the property since 2006, and the inclusion of such transactions being shaky at best. Example being one owner on Bear Creek that owns a home and lot (2 transactions) that they bought in 2006 and have lived there the entire time, and still do. It seems they “Bought” it from Big Canoe Realty again in May 2019. It makes one wonder if they are suddenly including property transfers between husbands and wives as “sales” also. There are lots of things in County Records that are not legitimate “Sales” of properties – but they are legal transactions – often Zero Dollar Transactions like gifts between spouses as I mentioned earlier. So, the SOURCE of their data is seriously in question.
- Lastly, in the 3rd Page of the June Admin Report, it shows a graph that indicates that total property sales through May totalled only 92 Properties (78 Homes & 14 Lots) – which is a far cry less than 117 Property Sales she is claiming in her verbal presentation.
So which is it? 92 Property Sales as reported in the written chart? Or 105 as my figures indicate (when my numbers are added to the April numbers)? Or is it 117 as Jane verbally reports in the Board Meeting? What in God’s name are we paying these people for? It really can only boil down to two options….
OPTION / EXPLANATION #1: Jayne Hagan is incompetent, or doesn’t take her job seriously enough, and needs to be replaced.
OPTION / EXPLANATION #2: Jayne Hagan is being told to falsify reports, in which case the person(s) instructing her needs to be fired / removed from position.
Jayne works for Jill. This is just another example of chaos under Jill’s leadership. Considering all factors, it is time for Jill Philmon to go. And some of our Senior Management (Jayne Hagan specifically) potentially with her. We need people we can trust, and that are competent, and between just the 2 of these individuals, we are racking up well over $400,000 a year in salaries and other paid benefits.
NOTE: If Jayne Hagan is presenting and preparing false documentation on ORDERS from higher ups, then she needs to clearly tell property owners who is making that call. If it is someone other than Jayne Hagan preparing these documents (she IS the one presenting them in meetings) then I owe her an apology – as soon as she tells us who is responsible.
On a final and very important note, the global financial world is flashing danger signals, and as a community we need to be paying attention, and getting our house in order.
- Bitcoin (Bitcoin Chart) (Bitcoin Story) and Gold (Gold Chart) (Gold Story)are spiking as people head towards safe-haven assets.
- Deutsche bank and other European banks are at the precipice of bailouts / defaults.
- Permanent Money Printing, and Negative Bond Rates are increasingly accepted as concensus predictions.
- As shown above, residential real estate is in trouble…. but commercial real estate specifically is REALLY flashing warning signs to the point that Big Global Investment Funds are raising capital pools in preparation for scooping up the looming Foreclosures..
- Trade war tensions. Geopolitical risks such as we have with Iran are increasing. These sort of “black swan” events could start the shaky financial dominoes tumbling at any time.
But with all the signs flashing brightly, all that our Board, Financial & Audit Committee Leaders can seem to think about is getting our community farther into debt to fund Golf and Clubhouse improvements that very few want, and serves only a minority of property owners, and outside “Resort Visitors”. Jay Goldman, Jeff Mayer and Ralph Ripley are financially blind to all other issues – so great is their obsession. It is time Property Owners launched an “Intervention”. We can no longer afford the financial “volunteerism” we have.
One last predicition / warning: I predict that “the triumvirate of bad financial decision makers” mentioned above, will soon announce a plan to refinace our debt (with increased limits) in order to fund excessive Golf & Clubhouse improvements. I predict that they will also include a “Non-Assesment-Increase” mechanism to pay for said debt – which will most likely involve some sort of membership fee, initiation fee, or sales fee, on NEW purchasers coming into the community. The point being that this “loan repayment revenue” will be tied to turnover in real estate sales. Well, as I have pointed out – those sales are rapidly decreasing. Everyone should ask themselves the following, when this Bergen Golf presentation comes….. “While they plan to pay for this refinance scheme with fees from real estate transactions to new property owners – what if those forecasted transaction numbers come in WAY under budget due to the slowing real estate market….. how will they make up for the shortfall then?”
Answer: Property Assesment Increase. Remember this come voting time. Even better, shut these people down now by clearly signalling you are fed up.
Real Estate is slowing for many reasons. It is mostly because of macro-economic, liquidity, consumer confidence and general market conditions. But our Board, Committees, and General Manager ARE CONTRIBUTING to the local downturn with their arrogant and tone-deaf approach to dealing with property owner concerns – which is driving an excessive number of people to put their properties on the market. This is making a bad situation worse.
IF ANYONE WANTS TO GET EARLY RELEASES OF OUR ARTICLES, or some held-back additional details and comments that we lay out in discussions, join our Facebook Group, and join the discussion….
https://www.facebook.com/groups/FocusonBigCanoeGA/
PS… I held off this Property Value / Real Estate Activity story as long as I could – because people really hate seeing these facts. Unfortunately, this is news that matters, and even if you hate seeing this – you need to be aware of, and paying attention to, what is happening in the world at large, and in our own backyard market. Playing ostrich never solved anything.
Good luck. Peace,
– david / publisher
themtnsvoice@aol.com < tipline and submissions for letters to editor
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