Rolling with the punches

I've been selling real estate for around 15 years now. Over the length of my career I have seen up and down markets but never such a dramatic lashing as the Gulf Coast has seen over the last two years. Those of us doing business on the Emerald Coast of Florida have been through the ringer as of late. In many ways Katrina was a perfect storm.

The local north west Florida market was coming off of an unprecedented sales boom where many property values had doubled in less than three years. The boom was taking it's natural course and had just started to slow down about the same time as hurricane Katrina struck. The combination of these two factors led the abrupt turn around in the local market. The effect was as if a light switch had been turned off. Then as the months rolled by the IRS in it's infinite wisdom decided to do the politically correct thing and established the Gulf Area Katrina Effected Opportunity Zone (GO Zone).

Among other things the Go Zone gave buyers of commercial or income producing real estate the ability to depreciate 50% of the value of the purchased property in the first year of ownership. Man, What a great deal!!! If your in the Go Zone! Unfortunately, my market was about 90 miles east of the IRS defined "effected area". Now I'll admit Katrina did no serious physical damage to our market area. Our damage came from the fallout after the storm.

My market was at least 60% investor driven. After the Establishment of the Go Zone every investor wanted to unload their Florida property to take advantage of the new IRS guidelines in Louisiana and Mississippi. When you combine our IRS problems with the vast majority of insurance underwriters dropping Florida insurance policies due to losses you could almost hear the fat lady singing in the background. Add to that rising interest rates and you can see why I call Katrina the perfect storm.

Fortunately for me. I had a very good INTERNET presence and was still generating buyer leads, although at a far slower pace. There's always a few people ready to pick up a deal. Now we're two years down the road and things are slowly starting to recover (a little).

The fact is that north west Florida is deal right now. I'm positive that any sound real estate investment made today in my old market will do well over the next five years.

I am a realist however. My wife and I own some ranch land in La Veta, Colorado where my family is from. So we decided to move up our schedule for semi-retirement. I had obtained my Colorado brokers license a while back and last year started construction of our log home in the mountains outside of town. Now I'm a licensed broker with Bachman & Associates here in La Veta. I'm now selling ranches, land and homes in the south central Colorado area.  I turned over our Florida business to our daughter. She is a born sales person and is excited be running the show herself now.

It has worked out extremely well for us. The Colorado market is strong and I am the happiest  I have ever been.   

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