• Oct. 6, 2009 - Sarasota the Number ONE Market to Buy in Now!
Today Show Lists Sarasota as THE Number One City to Buy In Now!
Barbara Corchran says if you wanted to TIME a Real Estate Market that has turned - Sarasota is the NUMBER ONE CITY in the US to buy in right now. Check out this video!
• Sep. 4, 2009 - "If They Gave Awards for Sand - Well They Do! Great article in NY Times!
New York Times uncovers the Hidden Treasure That Is Siesta Key!
I just had to share with you the article from the travel section in today's New York Times regarding visiting Siesta Key, and in particular doing so in the warm summer months. I will paste the link below and say that the article is SPOT ON. The only other things I might add: if you're interested in Renting a place here you should not miss www.SiestaKey.com and of course should you decide you want to own here - then visit www.RingTheWingers.com.
Fate smiled on Siesta Key, near Sarasota on Florida’s Gulf Coast, giving it powdery white quartz sand that stays cool even in the hottest summer weather.
• Aug. 5, 2009 - Buyers shouldn’t wait on falling prices!
Buyers shouldn’t wait on falling prices
We keep hearing here in Sarasota that a particular buyer wants to wait because they are convinced the market has further to fall. Well if the law of supply and demand holds true that MAY not really be the case for OUR area. MLS inventory levels are substantially lower now than they were six months ago. But the REALLY interesting this I found in the article reprinted below is the statistic that if interest rates go up just one point (and all indications are that we ARE at a market LOW for rates) your payment will be the SAME even if the acquisition price dropped by TEN PERCENT from today's pricing.
If you also factored in the current tax advantage for first time homebuyers as an example, that will expire in just a few months sitting on the fence or trying to "time the market" could in fact be a very bad move!
From Florida Association of Realtors:
NEW YORK – Aug. 5, 2009 – Fear of overpaying for property is common these days, especially in places where prices continue to be unstable. If you encounter potential buyers afraid to commit based on a fear that they’ll pay too much, point out these factors:
• Waiting for the right time can be expensive. Some buyers would have more equity today, despite falling prices, if they had bought when they first considered it instead of continuing to pay rent.
• Financing is fickle. Some people who were highly qualified last year can’t find financing this year because the credit market has tightened or their personal financial situation now makes them an undesirable borrower.
• Interest rates are headed up. If prices decline by another 10 percent but interest rates increase by 1 percentage point, the monthly payment will be the same.
Source: The Wall Street Journal, Douglas Heddings (07/27/2009)
• Aug. 5, 2009 - IRS Goes Web 2.0 to Promote $8000 First Time Homebuyer Credit
The IRS Wants ON to your IPOD to Illustrate the First Time Homebuyer's Credit!
On a recent visit to the IRS's Website I was surprised to find both English and Spanish Ipod Podcasts to help taxpayers understand the benefit of the current (and SOON to expire if not extended) $8000 First Time Home Buyer's credit. I will paste the link below but be sure to look in the upper right hand corner of the page that loads for the links to the Podcast.
Also note that if you work with certain lenders in Florida there may even be the ability to use the $8000 toward closing costs/downpayment. I'll put a link to the Florida Housing Finance Corporation to see if your favorite lender is participating!
Ahh the IRS on my IPOD - is this a great country or what?
“The new credit can get money in the pockets of first-time homebuyers quickly,” said IRS Commissioner Doug Shulman. “For people who recently purchased a home or are considering buying in the next few months, there are several different ways that they can get this tax credit even if they’ve already filed their tax return.”
First-time homebuyers represent a significant portion of existing single-family home sales. The expansion in the first-time homebuyer credit will make it easier for first-time homebuyers to enter the housing market this year.
Under the American Recovery and Reinvestment Act of 2009, qualifying taxpayers who purchase a home before Dec. 1 receive up to $8,000, or $4,000 for married individuals filing separately. People can claim the credit either on their 2008 tax returns due April 15 or on their 2009 tax returns next year.
Link to Florida Housing Finance Corp's Lender Pages:
Keep in mind that at least for now - these transactions MUST CLOSE by 12/1/2009 to qualify so given how long it is now taking to get financing in place and to work out issues with lenders on short sales and foreclosures - time is of the essance.
• May. 13, 2009 - Nice Enhancement to the $8000 First Time Homebuyer Credit!
You Might Not Have to Wait Until 4/15 to Get Your Money!
First off if you are in the market for a home you should become conversant with this $8000 First Time Homebuyer credit being offered on purchases through Dec of 2009. Here is a link to the relevant information at the IRS Wesbite:
Keep in mind: the credit Is fully refundable, meaning the credit will be paid out to eligible taxpayers, even if they owe no tax or the credit is more than the tax owed!
But wait it MAY actually be getting even better: you MAY shortly be able to use the credit for DOWNPAYMENT ASSISTANCE with certain FHA lenders:
DOWNPAYMENT ASSISTANCE
First-time homebuyers will soon have another option if they want to use their $8,000 tax credit toward a downpayment. According to HUD Secretary Shaun Donovan, FHA-approved lenders will soon be able to issue a short-term bridge loan equal to the tax credit. Buyers will then pay back the bridge loan after receiving their tax refund. Donovan hopes to have the details available within a few days.
• May. 12, 2009 - More than just light at end of the Tunnel!
Southwest Florida Led The Way INTO the Housing Decline - And we May be Leading the Way OUT!
Very good stats out from the Florida Association of Realtors below. Our own experience is bearing this out. Sales activity in the first four months of 2009 was WAY up and the Sarasota Association of Realtors/MLS shows that Pendings are still up again AND that inventory is coming down - fairly quickly. Buyers have jumped back in here as they clearly see the value - so much so that it is actually a lot harder this month to find those bargains that we found four months ago. Truly if you were on the sidelines wondering when to get back in - if you want to be in our area - that time is now!
HOME SALES
Sales of existing single-family homes in Florida rose 25 percent in first quarter 2009 compared to the same period a year earlier, according to FAR - the third consecutive quarter for higher existing home sales. Statewide existing condo sales in the first quarter rose 19 percent compared to 1Q 2008. Nationally, NAR says sales of all housing types slipped in the first quarter.
• Apr. 23, 2009 - Could There BE a Silver Lining to the Chinese Drywall Story?
Hard to Believe Chinese Drywall Could Help You with a Short Sale!
This is a true and funny story and the names have been changed to protect the innocent (and not so innocent!)
First if you do not live in Florida you may not have HEARD of Chinese Drywall. During the go-go years of 2004-2006 with the building boom on, US manufacturer's couldn't keep up with demand for drywall for new construction. So we began importing it from China. Now a lot of homes built with the product are having "mysterious" problems with wiring and plumbing corroding behind the walls and air handlers turning black and dying. The culprit SEEMS to be a sulphur gas being outgassed by the drywall. OK that being said - today the Sarasota Herald Tribune had another front page article about the problem and how the various builders affected are handling the situation (or in some cases NOT handling it!) Here's a link to that article:
OK so that puts this in context for you. Now as anyone who reads this knows, we do a fair amount of short sales, and not surprisingly one of them is in one of the communities where one of the builders in the article above built homes. I have been being frustrated with one of the lenders on the home who has been stalling hoping that they would get MORE money out of the short sale. Today I am speaking with their loss negotiator and asked where does she live. She was in a northern state. I asked have you HEARD of Chinese Drywall? Well she had not - so I mailed her the following note with a copy of the article:
"Attached is an article from today’s Sarasota Herald Tribune concerning what is happening here regarding Chinese Drywall. Note that the article specifically mentions XYZ Builders as one of the builders with problem. The subject property was built by XYZ Builders and is in XYZ Builders (name of community) and XYZ has acknowledged this IS one of the affected communities. The value on this property could drop like a stone if we lose this buyer."
And Hey PRESTO - she called back and told me - she is reccommending the bank ACCEPT the current Short Sale and I should have my acceptance letter shortly!!
I may have to incorporate this into my strategy for ALL short sales built after 2003! Guess they really don't WANT to own THOSE houses!
• Mar. 2, 2009 - It's ABOUT TIME - Fannie Mae Finally Gets Real About Short Sales
Even Fannie Mae May Now Realize, You Get What You Pay For!
In a move toward a little sanity in the Real Estate Marketplace real estate commissions are now protected in some short-sale transactions. In response to Realtor concerns, Fannie Mae announced that "preforeclosure sales may not be conditioned upon a reduction of the total (real estate) commission," providing the total commission does not exceed 6 percent. The policy became effective March 1.
I will put a link below to the new Fannie May Guidelines. Why is this good news for ALL concerned? Well make no mistake, Short Sales are HARD WORK, taking typically 3 times as long as an average real estate transaction AND probably ten times as much time when done RIGHT. You need someone who is willing to negotiate with your lender or lenders and is working hard to try to get the property sold prior to foreclosure and get the seller the best possible terms, satisfactions ideally, in working out the short payment with the lenders.
Somehow banks had decided the Realtor was one more spot they could reduce their "haircut" and many do try to make acceptance of the sale contingent on the realtor cutting their take on a deal they need to put so much added time into. Doing that leaves home sellers, particularly where the sale price is low, vulnerable to incompetent or unscroupulous practictioners as those who are best at doing this want to abandon the low end knowing their compensation, already low, would be cut.
We find it takes as much work to do a $100,000 Short Sale as a $3,000,000 one and once you cut the commission from 6 to 5 or 4.5 on that $100,000 sale - you just may not be able to afford to give it the attention it deserves. It's nice for one to see the value of this hard work recognized.
• Feb. 5, 2009 - Chinese Drywall, Foreclosures, Short Sales and "As-Is" Agreements!
A New Reason for Caveat Emptor in Getting That Bargain on your Dream House?
Below is a link to a recent article from the Sarasota Herald Tribune about a relatively new "threat" that is turning up in some newer Florida homes. Chinese Drywall. During the boom years for builders demand for drywall to build new homes far outstripped available US manufactured supply and a number of builders or their subs ended up sourcing drywall made in China. Now it seems to be outgassing something that may be causing pipes and wiring behind the walls to discolor and corrode. Yet the builders say it does not pose any threat to human inhabitants. I am not a scientist but my own perspective is, if it will corrode copper pipe, I'd just as soon not inhale it!
OK to WHY do I now wrap this around Foreclosures and Short Sales. Well in both Short Sales and Foreclosures you almost always HAVE to buy the home "As-Is" with a right to inspect. If you're buying a resale house right now built in say 2005 to even today (the Tribune article says the product is still sitting on shelves in the US and may be being sold or installed) then you MAY want to try to ascertain if this was used. But in the case of at least Foreclosures, because the bank never "lived" in the house, you always have to buy the house without receiving ANY Seller's Property Disclosure. And even in the short sales, where you're likely to get a disclosure, the lender, if they approve the sale, will make ALL parties sign what I euphemistically call the "Hold Harmless from Hell" where they make everyone state and restate that the seller is NOT going to be responsible for ANYTHING post the inspection - that you as a buyer release them etc etc etc.
If you're buying a resale home built prior to 2005 it's probably not an issue but if you find yourself looking at a home that is a "distress" buy and it is in that date range, perhaps a call to the builder to ask what THEY know about this issue from their other homes or their subs might be warranted.
In any event, let this be another reason why you never ever purchase ANY home without getting inspections from a reputable inspector - let the Buyer beware!
Article below points out a more and more common "flaw" if you will of short sales that are not properly managed. The seller thinks the sale has gone through and he has been released from the debt but INSTEAD, upon closer review of the short sale acceptance documents you find that all the bank agreed to was to RELEASE the LIEN on the property so it can be sold. If not CLEARLY spelled out then you cannot assume that you are not still on the hook for some or even all of the old debt. We see MANY investor homes where the one or both of the lenders ask for SOMETHING more than the proceeds of the sale to issue a satisafaction. I guess that is the point that needs clarifying here. A release of the lien on the house ONLY clears the way to SELL the house - that's not the same as issuing a Satisfaction of Mortgage. A satisfaction ALSO clears the lien but it is also the thing that shows on your credit report that you have, by either paying in full or in part, satisfied the debt. Anyway - BEFORE you get to the closing table, if you are working with your Realtor on a short sale - make sure you understand what is being offered to you and what will be expected of you post closing and include in that discussion any possible TAX ramifications as well. You may elect to suffer some of this but you need to understand what you are agreeing to....see below - Mike - W
Short sales were a hot topic at a recent meeting of the California Association of Realtors' board of directors; and brokers, brokerage attorneys, and risk managers underscored the importance of agents reviewing all short sale documents carefully. They should ensure that lenders consider the balance completely paid after the short sale goes through. Sellers who find out after the fact that they still owe the entire loan balance will be dissatisfied and possibly blame their real estate agent. Want more short sales information? Go to: http://www.floridarealtors.org/LegalCenter/HotTopics/index.cfm
• Nov. 17, 2008 - Short Sales and Foreclosures Moving UpMarket - The Trickle Up Theory!
Think Short Sales Are Only in the Subprime Market? Think Again!
Attached is a link to a Florida Association of Realtors article pointing out the changes in the market place that are now affecting the half million dollar plus and even million dollar place home market.
For us, our experience is that, like the article said a large group of these short sale homes ARE located in the sub $200K and now even sub 150K range and WERE limited to the sub prime market but we had already been seeing plenty of Shorts 500K plus and even 1 million plus as far back as this time last year. We believe that this (Sarasota Bradenton) market was a "leader" if you will, into the downturn - having had a market stall in September of 2005 and then at first a slow erosion of price which has turned in the last 14 months or so into a pretty rapid decline in price. And while the higher end SEEMED to react a little later - we saw that end of the market come down long before the folks nationally in the markets quoted have seen them.
Perhaps too, these took longer to go short as folks on the upper end of the market had more resources to exhaust and were willing to do so to try to avoid the stigma of either a short sale or a foreclosure. We have also seen banks be a lot more agressive in asking for some "owner contribution" on the higher end as they see this type of customer as having a better income stream to tap into or they would ask them to liquidate 401K type assets (that usually can't be harmed in a Bankruptcy but the bank is assuming the customer wants to avoid that route as well) or even that the customer has a better income stream and can afford to take back a note after the lien is released.
But as the market continues to weaken AND folks have had their 401K's and their portfolios depleted they have less resources to tap on AND are less willing to exhaust what they have left to keep a mortgage that is far bigger than the current value of the home current.
Once again, this is not the answer for everyone but if you find yourself in this position and need to understand your options you should speak with someone who has done a number of successful short sales before you get too far behind on your payments.
Below is a link to an AP Newswire article saying that foreclosure rates are up 25% year over year for October of 2008 back to October of 2007. As folks who read this blog know, in a way our real estate practice has benfitted from the spate of short sales and foreclosures but the last two years have been a real eye opener for us as well - on a lot of levels.
My heart goes out to folks who truly have financial misfortune and find themselves upside down and unable to stay in a home they thought they could afford but that is only one piece of this group of underwater properties.
More and more I am going into homes that were built by speculators and investors, they never lived in the home and they did 100% financing on the home - and now they cannot sell them for the outstanding loan balance and they end up in foreclosure. And here I'll use a specific to describe a general, never a good thing, but we have one where someone, AFTER they tried to sell the home themselves and before the home ends up in the property of the bank, literally REMOVED the KITCHEN from the building. Went in with a sawzall, cut the plumbing back to the wall, took every cabinet, appliance, counter, EVERYTHING. Now I can't say for sure WHO did this but the home shows no sign of forced entry. IF the previous owner did it, exactly how does one square the idea that although the bank financed EVERY dime of the home, if it's headed to foreclosure and the bank is going to lose 100's of thousands ANYWAY, then this person can in good conscience take a 50 to 60 thousand dollar kitchen with them as well??
We see it all the time, people are mad at the bank and destroy the home as they are leaving. SOOOO they leave all their NEIGHBORS with an eyesore that cannot be sold and when it does it severely depreciates values all around them and somehow they "punish" the "Bad Ol Bank" for loaning them money they probably shouldn't have borrowed to begin with! I guess I don't understand that logic at all.
I am no advocate for banks who made loans to people who had no business borrowing more than they can afford but conversely I feel if the bank financed the home, all of it, then if you give it back to them you should give it back, INTACT.
• Sep. 4, 2008 - Florida Dept of Revenue Kicking Short Seller's When They Are Down?
Ahh a New Source of Tax Revenue from Those Who Can Least Afford It - DOC STAMPS on DEBT FORGIVENESS!!
Yup you're reading that right. I had been getting warnings this was coming but now I've had my first short sale where it's taking place. I had a letter from a large title company that read in part:
"The Department of Revenue took an unofficial position last month that documentary stamps must be calculated based on the sales price paid by the buyer plus the amount of debt forgiven by the Short Sale Lender. Last week the Department of Revenue indicated that it was still considering the issue and that the position previously communicated by their staff was the unofficial opinion of the revenue officers, not the official positionof the Department. The Department has agreed to communicate their official position as soon as theyhave determined it."
What does this mean? Well lets say in the past if you sold your house for $100,000 but had paid $200,000 and you were going to make up the shortfall on any loan at the closing - well the state got paid Doc Stamps on the actual new purchase price and that's 70 cents per $100 of purchase so it's $700 on $100,000. But NOW the state has figured out how truly to give you a kick when you're down. IF you work out a short sale with the bank and you sell the house for $100,000 but you OWE $200,000 well then they are considering you paying doc stamps for an over all purchase price of the full amount. In this case the doc stamps would double to $1400. In the case of the short sale I am closing later this month - it added $910 to the seller's costs at a time when they can LEAST afford to pay ANYTHING. And because the state IS unclear we now have closing agents who want to collect the maximum tax even if in three weeks the state were to rule the other way!!
Even the IRS sees the need to work something out here for folks losing their primary residence and the debt forgiveness act of 2007 takes this issue off the table for most homeowners. But it doesn't satisfy the state of Florida - and being that we're one of the top states in the nation for Foreclosures, Short Sales and Debt Forgiveness the state may be tapping into a new, lucrative and EVER SO PAINFUL new revenue stream. Surprised? I'm not.
• Aug. 21, 2008 - Is this the END of Downpayment Assistance?
Down Payment Assistance Set to Bite The Dust October First
Below is a link to a very informative article from BankRate regarding the possible (PROBABLE) end of Seller down payment assistance.
I had mentioned in an earlier blog what I felt were the pros and cons of these "Gift" programs. As of October 1st if the legislation stands as written - these will no longer be allowed for any Fed Insurance backed mortgages.
My own experience with them is a real mixed bag. Yes they DO allow people with very little of their own money to put in to achieve home ownership and get a mortgage. That in itself is a two edged sword. Home ownership is a positive influence on the economy in many ways and obviously personally for us as well.
The downsides as I see it are these: First, with so little down and with the market in many areas continuing to fall, we will be left again with a large number of these where the folks who feel any financial pinch will realize that they have zero equity and no real reason not to default. For the market to finally stabilize we HAVE to get all these defaults with their corresponding Short Sales and Foreclosures to work their way out of the system. They depress appraisals in general and continue the downward spiral in property values.
Second the entire practice of turning cash back from the seller into a "Gift" that meets the current lending guidelines has created a nice "cottage" industry for companies that do exactly that - they take a Seller's cash back at closing and, for a fee, convert it into a complying "gift". So what's the problem with that? Well in the ones I have been a party to (and I have NEVER had one of my buyers do it - I have only been part of having my sellers participate) the cost these "not for profit" companies charge is very dear. In one case it was $750 to convert just $5000!! That's FIFTEEN PERCENT to convert it into a complying gift. No surprise that in this article two of the biggest players in this business are very vocal and actively trying to protect first time homebuyers (and their own best interest) in finding a way to keep this very lucrative (for them) program alive.
My point would be, if you're going to allow seller participation and take the risks associated with it. just allow it, with some reasonable guideline. But let's just call it what it is, let the market assume the risk associated with it, and eliminate the need for "clever" conversions that only add needless expense and just line someone's pockets with the already crimped funds available from a buyer with limited funds and seller's who keep having their equity chipped away. Otherwise let's live without the practice.
I had an interesting conversation today. Seems in January I spoke with a very nice lady who, like many others out there - found herself unable to continue making her mortgage payment. I explained how a short sale works and she said she and her husband would discuss it. I followed up a couple times but she seemed to have lost interest - and I moved on to greener pastures.
Today she called my office and my cell - she needs to speak with me RIGHT AWAY. When I got back to my desk I checked at the Clerk of The Circuit Court site - she is being foreclosed upon. And received a summons. The house had been "Lis Pending" for over two months.
So I did call her, and she said there must be something I can do. I said well you really needed to try to short sell this months ago. Turns out that a neighbor of hers is a Real estate agent and she decided to list with them. They had the house listed for 500,000 (appx). I checked and a list of comparables justified a price of about....333,000!! She says, well he never got much action and nobody made an offer. I said well why is it listed so HIGH? She says well THAT'S what we OWE on it!!!!! And that's what my real estate agent (her neighbor) said we have to sell it for!
Well it's NOT a SHORT SALE when you sell it for what you OWE on it. And maybe the fact that you OWE $200,000 more than your neighbors are selling their houses for is a reason your neighbor can't seem to drum up any interest in the house! We call it a SHORT SALE when the proceeds of the sale are going to have you "coming up SHORT" against what you owe the bank!!
For a short sale to work you need to have an offer that the lender thinks is reasonable against the current value of the house - not against what you OWE on it. If you do not have ANY offers you won't have any basis for a discussion with a loss mitigator to justify a short sale. In this case the lady's neighbor/agent told her he was unable to have a conversation with the bank - that they are "Too Hard to Get Hold of". Uhhh that's your job if you're short selling - the agent needs to keep dropping the price until you have an offer you can take to the loss mitigation dept. If you don't have an offer, you've got NOTHING the loss mitigator can talk to you about so sitting for months on the market at the current loan value is downright dumb!! And for this poor lady what that agent did is use up all of her negotiating time ineffectively marketing the home at the wrong price.
Now, with an auction date set, all I could tell her to do was, call a lawyer and start packing! (I thought the lawyer might be able to help her at least negotiate a Deed in Lieu). Even the lawyer said, they waited too long - it's going to foreclose.
I did ask her - "How many short sales has your neighbor/agent done"? She said he told her TWO. I'd say if he left the home in the MLS for six months at the loan value - he sure as heck doesn't know how to do short sales. And here is proof positive - for that agent all he has is a listing he couldn't sell. But for his customer who was not properly served - well they face foreclosure, a severely damaged credit report for seven to ten years, lots of stress and sleepless nights.
If you needed a Thoracic surgeon and your neighbor was a veterinarian but said he had handled these would you pick a neighbor so there wouldn't be "hurt feelings"? Of course not! This process is way too complicated to leave to amateurs and hurt feelings or not - this is an area, like a doctor, a lawyer or a CPA - you pick it for competence - not because they are "nice" and live close by. Those nice neighbors can now help her pack - or just say "Tsk Tsk - what a shame" as she loses her house and her credit! And they move on to their next sale....
• Jul. 21, 2008 - June Credit Suisse Realtor Survey Results (Formerly Bank of America Realtor Survey)
Below is a link to the June 2008 Results for the Credit Suisse Realtor survey. As many of you know this survey is conducted by Daniel M. Oppenheim, CFA amd Michael Dahl both of whom were with Bank of America and are now with Credit Suisse. I am a monthly contributor to the poll and I have received their permission to place it here for you. I like it as, while it is FROM Realtors the results are computed by this independant entity at Credit Suisse so it is hard to say it is colored by, for example, an overly optimistic outlook that many feel real estate trade associations give off. Any go to page 44 of 59 for the Sarasota results.
• Jul. 15, 2008 - Is There ANY Silver Lining in the Indy Mac Takeover? Maybe.
Fannie, Freddie and Indy Mac rescue pushes housing aid.
The Fannie Mae/Freddie Mac problem will likely boost momentum for a quick final passage of Congress' massive housing aid bill, aimed at helping some 400,000 struggling homeowners. "I'm confident we're going to get this done," said Sen. Christopher J. Dodd. "Unfortunately, these events over the last few days have probably increased the importance of this in the minds of some."
AP News Story today that may in fact show that the Indy Mac "meltdown" and the Fannie Mae and Freddy Mac confidence issue may in fact help homeowners in mortgage trouble as it forces Congress' hand in moving legislation through that, by guaranteeing some homeonwers refi's will prop up both an ailing mortgage and housing industry AND some hurting consumers as well.
As a Realtor dealing with Short Sales and distressed property, dealing with bank loss mitigation officers AND a Mortgage Broker my exposure to these issues is perhaps sometimes through the fisheye lens but I had a very interesting discussion with a client in the banking industry (who will go unnamed!) and I asked him how far he thought this problem could go. His explanation was crystal clear and maybe a little scary. He explained that it is common knowledge that banks in the US are levergaged between 30 and 60 times their available asset base - so let's use 40X as the average. If the VALUE of the assets they are leveraged on falls just 2.5% then - they have exhausted the onhand assets! So if a particular institutions PRIMARY asset base they leverage on is HOUSING stock and we KNOW nationally and CERTAINLY here in Florida that the overall value of housing stock has fallen far more than 2.5% - the results could be VERY far reaching.
No wonder then that both parties understand the seriousness of this, no matter HOW we got here, we had better begin making sound policy decisions as regards both banking AND the housing market.
• Jun. 25, 2008 - And you thought "No Money Down" Mortgages were Dead!
The Good The Bad and The Ugly on Zero Down Payment Mortgages
Below is a link to an AP story discussing the NEW proliferation of No Money Down Mortgages.
No downpayment mortgages have largely disappeared as a financing option from private lenders. But they are still available - and growing more popular - using existing FHA programs in conjunction with nonprofit groups' downpayment assistance programs.
The article mentions the "Not For Profit" organizations that help buyers with little or no funds get a loan. We have been seeing more of these as well. In some cases we have seen the "Not for Profit" charge $500 to $750 to basically convert a SELLER's contribution to the buyer's closing into a $5000 "gift" which is handled differently for the purposes of qualifying for a mortgage than simple seller contribution to closing is. Many lenders have pretty strict limits on the amount the seller can contribute to the buyer's costs but these programs seemingly overcome that limit - at some expense of course.
So what's good, what's bad and what's ugly. Well good from a first time buyer's perspective is that yes there does still seem to be, even in this new era of tighter lending criteria, a way to get into a home with little or no money. Also good for some sellers desperate to get SOLD and Realtors who are desperate to get paid (and make no mistake we like to get paid!) - so these "creative" steps get deals done.
Bad is that in tightening up these requirements we have now created this little cottage industry that converts seller contributions at what looks to us as a cost of over 10% of the amount contributed. The very nature of this seems to be to circumvent some restrictions AND it either ends up costing the buyer more or reducing the net for the seller.
The Ugly? Well the ugly is probably one of the "remains to be seen" issues but clearly the largest number of mortgage defaults are when buyers no longer have ANY equity so they don't feel compelled to keep paying should rates rise or should market conditions further soften. Statistically, in a lot of areas of the US right now, prices continue to fall. Are all these new no money down loans creating just another foreclosure spike somewhere a little further down the road AND this time it won't be private lenders exposed but the US Taxpayers.
Here's a link to the article, you may need to copy it into your browser address window:
• Jun. 10, 2008 - Foreclosed homes bring stinky pools and health warnings!
Foreclosed homes bring stinky pools and health warnings!
Saw this article today from Florida Association of Realtors and the South Florida Sun-Sentinel about the number of dirty pools in Florida due to foreclosures and it struck home.
From what I've seen it is not just foreclosures that end up with that as an issue. As you know if you read this blog at all, we now do a large number of short sales and distressed properties and it seems like the VERY first thing to go when homeowners are cutting back and considering having to short sell is....the pool guy!! :-) And a lot of the property management companies that banks use to sell their REO property may have the lawn mowed but never hire pool care.
The OTHER thing I have learned is that, particularly down here in Paradise, you stop putting chemicals in the pool and even if you run the pump night and day it will be green in about a week to ten days. When they let the electricity go off and then the pool doesn't run - well the pool looks like pea soup in as little as 4-5 days. And if there is no cage then it starts looking like a science project with polliwogs and toads and snakes and mosquitoes pretty darn quick.
I AM amazed though that I find home LISTED for SALE where the power is ON but because the owner fired the pool guy no one is putting chemicals into it and even though it's running it's green. What we find is that, regardless of how well priced it is - if the pool is green it is SO much harder to sell. So I am always encouraging sellers, even those upside down on the loan, if they are serious about selling to keep the pool up but quite honestly I now almost always have a bag or two of shock in the back of the car and some chlorine tablets. At the last short sale we closed (and it was for three quarters of a million dollars on Siesta Key) the buyer asked for the number of the pool guy so he could continue on the "contract" with them. I opened my trunk and pointed to my chlorine tabs and said that the pool guys last day was.....TODAY! Me!
Here's the article - the situation really ISN'T funny if this pool is next door to you:
• May. 23, 2008 - Siesta Key in Top Ten US Beaches for 2008!
Doctor Beach Picks Siesta Key Again!
Link below to an article in today's Sarasota Herald Tribune listing Dr Beach's top 10 beaches in the US. This year Siesta Key is number three in the United States including Hawaii! We have our own list of favorite local beaches and Siesta is right up there but we love the natural beauty of Caspersen's Beach down in Venice (and we love to hunt for shark's teeth there too!) and we love the beach accessible by boat at Midnight Pass between Siesta and Casey Key. In fact there isn't a bad beach in the bunch here on the Suncoast! Anyway here's the top 10 and then a link to the article. Another reason why we think of this place as paradise!
• Oct. 1, 2007 - Strength in Numbers - Stand Up and Be Counted on Property Tax Reform!
STRENGTH IN NUMBERS
It's time for supporters of property tax
reform to be counted. Gov. Charlie Crist just launched his "Yes on 1" Web site to promote passage of property tax reform,
to be accomplished through a proposed constitutional amendment. "While the amendment is temporarily off the ballot, we
have every confidence that the citizens of Florida will be voting on tax reform on Jan. 29," says John Sebree, FAR vice
president of public policy. "Floridians have suffered long enough and deserve an opportunity to vote for the largest tax
cut in Florida history." The Web site asks visitors to join the reform movement and includes a count of the "number of
Floridians who support Amendment 1." Help make that number grow by going to the "Yes on 1" Web site, http://yeson1florida.com/.
Don't let this pass you by...if you are
concerned about real estate values here in the Sunshine State property tax reform is a MUST. High property taxes along
with high insurance rates are the two main factors quoted most often when you read about flight out of the Florida housing
market. Stand up and be counted!!! - Mike W
• Sep. 26, 2007 - Best Places to Retire: Venice, Florida!
A hidden treasure that is not so hidden anymore:
This week's US News lists 10 best places to retire for 2007. Venice Florida is one of them! Our office is in Venice and we do lots of business there and always have great properties available. Venice has so much going for it, beaches, great downtown, awesome schools, the ICW, shark's teeth, golf, boating, lots of great restaurants, close to all the entertainment and amenities of Sarasota and even Ft Meyers and Naples. Easy to get to and of course, the weather. It's not just one of the best places to retire - like the rest of the Suncoast it's also one of the best places to live period! Here are links to the article:
Real Estate Market statistics, buying, selling strategies, financing, insurance for Sarasota, Siesta Key and the barrier islands from Ann & Mike Winger, REALTORS with REMAX Tropical Sands.
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