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The companies that failed were Atlantic Preferred, Southern Family Insurance, Florida Preferred, and Vanguard. The first three were owned by Poe Financial Group which was based in Tampa.
The surcharge is supposed to be a one-time assessment at this time, and a total of $315,000,000 is expected to be raised by its imposition.
GAINESVILLE, Fla. — Florida’s consumer confidence rose three points to 80 in October largely due to optimism among low-income residents, a new University of Florida study finds.
One possible explanation is that these consumers, having already experienced the worst of the housing crisis, now look forward to property tax reform, or it could be the result of some unknown factor, said Chris McCarty, director of the Survey Research Center at UF’s Bureau of Economic and Business Research.
“Consumer confidence in Florida, which has been lower than the nation, is now very close to the national number of 80.9 as measured by the University of Michigan,” McCarty said. “The source of the rise in Florida appears to be low-income households, those living off of less than $30,000 annually.
“For these people, consumer confidence was already as low as it has been for a long time, so it’s almost to the point where the only way it could go was up, whereas there was still room for confidence among middle- and upper-income households to decline, which turned out to be flat this month,” he said.
While consumer confidence among middle- and upper-income households has remained the same at 81, the measure for low-income households rose from 66 in September to 75 in October, he said.
“The rise in confidence among low-income households appears to be driven by improved personal finances now compared to a year ago and expectations about improvement over the next year,” McCarty said.
Among this group, there was a huge increase in perceptions about whether it is a good time to buy big-ticket items, from 68 to 86.
“Respondents may have already factored in the ill effects of housing and are anticipating improvement,” he said. “They may also be looking toward property tax reform from the Florida Legislature as a source of relief as the governor and Legislature considers property tax cuts.”
The housing debacle has hit Florida hard compared to the nation as a whole, McCarty said. Florida, along with California, Arizona, Nevada and parts of Washington, D.C., have suffered very large declines in sales and housing prices, he said.
Last month’s overall consumer confidence was revised downward two points to 77 after all completed surveys were included in the index.
The rise in this month’s confidence was due to increases in three of the five components that make up the index. Perceptions of U.S. economic conditions over the next year rose six points to 75, perceptions of whether it is a good time to buy big-ticket items rose four points to 85 and expectations of personal finances a year from now rose four points to 90.
The two components to experience declines were U.S. economic conditions over the next five years, which fell two points to 78, and perceptions of personal finances now compared to a year ago, which fell one point to 70.
On the positive side, gas prices declined briefly in October, but they are likely to go up as oil prices on the international market rise, he said.
Such a price increase would occur just as the holiday season approaches, McCarty said. “Retailers will very likely slash prices early to get otherwise hesitant consumers in the door,” he said.
The research center conducts the Florida Consumer Attitude Survey monthly. Respondents are 18 or older and live in households telephoned randomly. The preliminary index for October was 434 responses.
Consumer confidence is designed to help predict buying patterns by measuring the mood of consumers toward purchasing. Although other economic indicators also predict buying patterns, consumer confidence tends to be available sooner. The index is benchmarked to 1966, so a value of 100 represents the same level of confidence for the year. The value of the index is in comparing changes over time rather than looking at an isolated month.
Writer Cathy Keen, ckeen@ufl.edu, 352-392-0186
Source Chris McCarty, ufchris@ufl.edu, 352-392-2908
Source: University of Florida Media Release
I am not sure if we will see a turnaround in the housing market or not, just yet. For quite a while interest rates have been very low from a historical perspective, yet buyers are still hesitating. Part of this is because they have a home to sell and just cannot stand to sell it for less than they could have a couple of years ago. No matter that the home they will be buying will also be cheaper. Another worry is that buyers are not sure the price drops have bottomed out. I think that once the mind-set of the public becomes more positive and less fearful, the housing market will finally begin to rebound. If interest rate cuts will do it, fine. I am not sure that this will be enough.
For more information or questions about this topic please call me at: 813-783-4444 or e-mail me at: jelwell1@tampabay.rr.com
I also invite you to visit my my website where I think you will find a lot of useful information. To get there just click on the following link: www.jelwell.century21bnr.com
Now we have a real grab-bag of items and no one (except the politicians) seem to know whether these reforms will offer homeowners and businesses real tax relief if the voters approve them. The main points of what the legislature has done are the following:
The lawmakers made no allowance for first-time home buyers and there is a faction that feels that this oversight could make room for a constitutional challenge of the reforms in the future. Time will tell.
After all the hoopla that has been going on this year over insurance and property tax reforms, I will be very surprised if we do not end up with a "trick" instead of a "treat" next year. I hope that I am wrong.
For more information or questions about this topic please call me at: 813-783-4444 or e-mail me at: jelwell1@tampabay.rr.com
I also invite you to visit my my website where I think you will find a lot of useful information. To get there just click on the following link: www.jelwell.century21bnr.com
In Zephyrhills, Florida and in other parts of the country (especially in southern states), there are many mobile home subdiviisons. Here a lot of them are registered 55+ parks. These types of dwellings are affordable dwellings for winter visitors and year round residents. If they are on their own land and not a rental lot, they do appreciate if they are well-maintained. Here I am discussing only mobiles on their own land, not rental lots. Financing homes in rental parks is a completely different ballgame.
If a mobile home is less than 30 years old, many lenders will finance the purchase of them. However, if a mobile was built prior to 1978 finding a mortgage can be difficult. Even though many of these homes are in great shape and have been updated over the years, most lenders shy away from lending money to buy them.
Here are two options that some of my buyers have used to finance their purchases of "oldies but goodies"
Equity Loans on Their Primary Residences
For those people who are buying the mobile as a second home and for those who are considering moving here permanently, one option is to get a home equity loan on their current primary residence. Around Zephyrhills, most older double-wide mobile homes sell in the range from $50,000 to $70,000. Often buyers have enough equity in another home that they can pull some of it out to buy the home here. This route often involves less loan costs than getting a mortgage using the mobile as the collateral. The process can also be quicker. Do be aware that banks will usually not give you a home equity loan if your home is already listed for sale with an agent. So if you are considering getting your purchase money this way, FIRST get the loan, then list your home for sale.
Stick With Small Local Banks/Credit Unions or Local Branches of Larger Banks
If you have good credit, often local banks, like the First National Bank of Pasco County, and others will lend you money by keeping the mortgage loan "in house". That is to say, they do not plan to try to sell it on the secondary mortgage market since it does not meet the standards for sale in that venue. Since the loan amount is not great and the buyer must be very credit-worthy they are comfortable lending on older mobiles. Some local credit unions are also more lenient and flexible. If you call Wachovia's nation-wide mortgage company and say you want to finance a mobile (of any age) they will turn you down flat. However, if you visit the local branch office you might find them more inclined to do an "in house" loan. I have seen it happen.
So if you find a great older mobile home that you would like to buy, remember, that "there is more than one way to skin a cat". As long as you have good credit and the banks have lots of available money, you might just be able to get that home you have fallen in love with.
For more information or questions about this topic please call me at: 813-783-4444 or e-mail me at: jelwell1@tampabay.rr.com
I also invite you to visit my website where I think you will find a lot of useful information. To get there just click on the following link: www.jelwell.century21bnr.com
So for those of you who have protected your credit rating as if it were a valuable diamond, now may be the time to buy your next home. Not only will you probably get a better interest rate and other more attractive terms. But you will also be in the unusual situation where lenders are willing to compete against each other to get you to choose them. You will also find some of the lowest home prices that we have seen for many years!
For those of you who have let your credit rating drop lower and lower by making late payments, going into bankruptcy, etc., now is a perfect time to start getting your scores to climb again. Most of you already know the basic things you will have to do, borrow less, get rid of credit cards, and make your payments in a timely manner. For other ways to get back on track, you can find a lot of information on the internet concerning how to repair your credit.
For more information or questions about this topic please call me at: 813-783-4444 or e-mail me at: jelwell1@tampabay.rr.com
I also invite you to visit my my website where I think you will find a lot of useful information. To get there just click on the following link: www.jelwell.century21bnr.com
ORLANDO, Fla., Oct. 24, 2007 – Mirroring the national trend, turmoil in the mortgage market impacted Florida’s housing sector in September, despite continued low unemployment rates and other positive economic activity. Statewide, sales of existing single-family homes totaled 8,688 last month while 14,044 homes sold in September 2006 for a decrease of 38 percent in the year-to-year comparison, according to the Florida Association of Realtors® (FAR).
Housing industry analysts previously predicted that mortgage disruptions would affect home sales in September. The National Association of Realtors’® (NAR) latest market outlook expects conditions for the mortgage industry to improve in the coming months and that widening credit availability will help homebuyers. Keeping the current housing market in perspective, 2007 will be the fifth highest year on record for existing-home sales, says NAR Senior Economist Lawrence Yun. “Although sales are off from an unsustainable peak in 2005, there is a historically high level of home sales taking place this year,” he says. “One out of 16 American households is buying a home this year.”
Florida’s median sales price for existing single-family homes last month was $221,200; a year ago, it was $243,300 for a 9 percent decrease. The median is the midpoint; half the homes sold for more, half for less. In September 2002, the statewide median sales price for single-family homes was $139,600, for an increase of 58.5 percent over the five-year-period, according to FAR records.
The national median sales price for existing single-family homes in August 2007 was $223,900, essentially even with the year-ago figure, according to NAR. In California, the statewide median resales price was $588,970 in August; in Massachusetts, it was $357,000; in Maryland, it was $315,850; and in New York, it was $255,000.
Sales of existing condominiums in Florida also decreased last month, with a total of 2,557 condos sold statewide compared to 4,032 in September 2006 for a 37 percent decline, according to FAR. The statewide median sales price for condos last month was $194,200, down 4 percent from September 2006’s condo median price of $202,800. NAR reported the national median existing condo price was $228,500 in August 2007.
Last month, interest rates for a 30-year fixed-rate mortgage averaged 6.38 percent, according to Freddie Mac, which was lower than the average rate of 6.40 percent in September 2006. FAR’s sales figures reflect closings, which typically occur 30 to 90 days after sales contracts are written.
Among the state’s larger markets, the Jacksonville Metropolitan Statistical Area (MSA) reported 878 existing homes sold last month compared to 1,191 homes sold a year ago for a 26 percent decrease. The market's median sales price for homes was $194,800; it was $190,800 in September 2006 for a 2 percent increase. A total of 113 existing condos changed hands in the MSA last month, down 14 percent from the 132 condos sold the previous year. The existing condo median sales price in September was $162,700; a year ago, it was $185,500 for a 12 percent decrease.
“Northeast Florida is a wonderful place to live,” says Hank Oltmanns, president of the Northeast Florida Association of Realtors and broker-owner of A Broker’s Choice Realty. “The unemployment rate in Jacksonville is between 3 to 4 percent, and new business is always coming into the area and generating jobs. The St. Johns River offers access to anywhere in the world. Jacksonville offers all the amenities of a big city, yet the lifestyle here is relaxed and laid-back.”
Among the state’s smaller markets, the Panama City MSA reported a total of 102 homes sold in September compared to 113 homes a year ago for a 10 percent decrease. The existing home median sales price was $184,000; a year ago, it was $203,000 for a 9 percent decrease. A total of 38 existing condos sold in the MSA last month compared to 32 condos the previous September for a 19 percent increase. The market’s existing condo median price was $250,000; a year ago, it was $262,500 for a decrease of 5 percent.
Scott Bowman, president of the Bay County Association of Realtors and a broker-sales manager with Prudential Shimmering Sands Realty, says that the area’s investment in new infrastructure is attracting buyers’ interest. “A lot of things have been happening in our market over the past few years: We’ve widened our roads, built a new bridge and had a new airport site approved,” he says. “The injection of new infrastructure is having a good impact on the market, along with expanding industries. For example, there’s a company wanting to use the Panama City port facility for a wood pellet [a renewable energy source] plant they’re planning in the northern part of our county.”
Source: FAR Media Release
WASHINGTON, October 24, 2007
Temporary problems in the mortgage market are easing and are expected to free some pent-up demand, but disrupted existing-home sales and distorted prices on sales closed in September, according to the National Association of Realtors®. Even so, prices rose in the Northeast and Midwest.
Total existing-home sales – including single-family, townhomes, condominiums and co-ops – fell 8.0 percent to a seasonally adjusted annual rate1 of 5.04 million units in September from a downwardly revised pace of 5.48 million in August, and are 19.1 percent below the 6.23 million-unit level in September 2006.
The third quarter finished better than expected, with a 5.42 million annual rate of existing-home sales versus the 5.38 million forecast by NAR.
Lawrence Yun, NAR senior economist, said the decline is understandable. “Mortgage problems were peaking back in August when many of the September closings were being negotiated, and that slowed sales notably in higher priced areas that rely more on jumbo loans,” he said. “The good news is that mortgage availability has markedly improved in recent weeks with interest rates on jumbo loans falling, and more people are applying for safer and conforming FHA mortgage products. Some of the cancelled transactions will move forward as buyers apply for other loans.”
The national median existing-home price2 for all housing types was $211,700 in September, down 4.2 percent from September 2006 when the median was $220,900; this follows three months of stability in comparing with year-ago prices. The median is a typical market price where half of the homes sold for more and half sold for less.
“Because there were fewer transactions at the upper end of the market, there is a downward distortion reflected in a lower national median home price. Home prices continue to trend up in the Northeast and in the condo sector. In other areas not dependent on jumbo loans, such as much of the Midwest, prices are rising.”
Total housing inventory inched up 0.4 percent at the end of September to 4.40 million existing homes available for sale, which represents a 10.5-month supply3 at the current sales pace, up from a downwardly revised 9.6-month supply in August. “It appears raw inventories are stabilizing, but the housing supply is a bit inflated now because the sales pace does not reflect underlying market conditions – sales were dampened by the mortgage cancellations,” Yun explained. “Once the pent-up demand begins to move, we’ll see housing supplies begin to ease and then prices will edge up.”
NAR President Pat V. Combs, from Grand Rapids, Mich., and vice president of Coldwell Banker-AJS-Schmidt, said housing remains a good long-term investment. “Because local conditions vary widely, it’s important for consumers to understand the fundamentals of what’s going on in their area. To sort through the factors in a particular neighborhood, both buyers and sellers should consult with a Realtor® to help them navigate the current local market.”
According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage fell to 6.38 percent in September from 6.57 percent in August; the rate was 6.40 percent in September 2006.
Single-family home sales dropped 8.6 percent to a seasonally adjusted annual rate of 4.38 million in September from a pace of 4.79 million in August, and are 19.8 percent below 5.46 million-unit pace in September 2006. The median existing single-family home price was $210,200 in September, down 4.9 percent from a year ago.
Existing condominium and co-op sales fell 4.3 percent to a seasonally adjusted annual rate of 660,000 units in September from 690,000 in August, and are 14.7 percent below the 774,000-unit level in September 2006. The median existing condo price4 was $221,700 in September, up 1.4 percent from a year ago.
Regionally, existing-home sales in the South declined 6.0 percent in September to an annual pace of 2.05 million, and are 18.7 percent below a year ago. The median price in the South was $174,400, down 5.5 percent from September 2006.
In the Midwest, existing-home sales dropped 7.0 percent to an annual rate of 1.19 million in September, and are 16.2 percent below September 2006. The median price in the Midwest was $170,700, up 1.4 percent from a year ago.
Existing-home sales in the West fell 9.9 percent in September to a level of 910,000, and are 27.8 percent below a year ago. The median price in the West was $308,900, which is 8.8 percent lower than September 2006.
In the Northeast, existing home sales dropped 10.0 percent to a pace of 900,000, and are 13.5 percent lower than September 2006. The median price in the Northeast was $261,700, up 0.5 percent from a year ago.
Source: NAR Media Release
A Freddie Mac spokesman said that worries about slow economic growth over the coming months caused interest rates to drop. They are unsure how much the housing slump will affect the overall economy. Some reports suggest that manufacturing figures for October will come out lower.
Sales of existing homes dropped to their lowest level since January 1998 and are a result of the credit tightening that has taken place in recent months.
Do keep in mind that we live in a very large and complex country. What happens in California is not necessarily what is happening in Florida. And what happens in Florida may be a far cry from what occurs in Michigan. Real estate is still very much a local issue.
If you want to learn more about Freddie Mac or see the details of their survey, go to: www.freddiemac.com and click on the link for "Current Weekly Survey". They break down the survey by specific regions in the United States so you can see how your state compares to other parts of the country. They also explain the mission of Freddie Mac and offer a lot of useful information for consumers.
If you would like to speak with a lender you can find some at my website: www.jelwell.century21bnr.com . You can also speak with your own bank, credit union, or mortgage broker to see what your particular interest rate would be should you decide to finance a home purchase.
I have just listed this home in the South Hill Mobile Home Park just to the west of Zephyrhills, Florida. It has two bedrooms, two baths, and a two car carport. The home also features a screened covered patio, vaulted ceilings, and utility room. Range, refrigerator, microwave oven, washer and dryer are included in the sale.
This is not a rental park. You own the land. Deed restrictions do exist and this park does appear on Florida's list of 55+ parks. The subdivision amenities include a recreation building, community pool, and shuffleboard courts. Due to its location you have very easy access to parks, supermarkets, restaurants, supercenters, and medical facilities. Yet the fees in this park are just $25 per month!
With our winter visitors returning soon, this home will not last long at just $76,900.
For more information or to arrange a tour please call me at: 813-783-4444 or e-mail me at: jelwell1@tampabay.rr.com
I also invite you to visit my my website where I think you will find a lot of useful information. To get there just click on the following link: www.jelwell.century21bnr.com
It was great to meet so many new people and hopefully they will avoid having to put up with a nasty and possibly life-threatening influenza infection this year. We hope that in future years even more people will visit us as they hear about the clinics from friends and neighbors. Thanks to all who helped make this event a success.
For those that missed this opportunity I have heard that CVS drugstores and Sweetbay Supermarkets in the East Pasco County area of Florida will also be offering flu shots in the next few weeks. Check with any of these stores for more information concerning times and dates.
For more information or questions about this topic please call me at: 813-783-4444 or e-mail me at: jelwell1@tampabay.rr.com
I also invite you to visit my my website where I think you will find a lot of useful information. To get there just click on the following link: www.jelwell.century21bnr.com
Today 10/18/07, Freddie Mac reported that the average mortgage interest rates for 30 and 15 year fixed-rate loans either stayed the same as last week or went up just a bit. Nationally the average mortgage interest rate for 30 year fixed-rate mortgages was 6.40% (6.36% in the southeast), unchanged from a week ago. The average interest rate for 15 year fixed-rate mortgages was 6.08%, up from 6.06% last week.
"Both economic indicators and mortgage rates came in mixed this week", said Frank Nothaft, Freddie Mac vice-president and chief economist. "While retail sales were stronger in September, consumer confidence fell below market expectations in October. Moreover, both the core consumer price index and producer prices for September remained contained."
On October 15th Federal Reserve Chairman Nemanke said he felt that the housing market slump would continue to be a drag on the overall economy into 2008. Unsold housing inventory remains high and homebuilder confidence has reached the lowest level yet since they began charting it in 1985.
Do keep in mind that we live in a very large and complex country. What happens in California is not necessarily what is happening in Florida. And what happens in Florida may be a far cry from what occurs in Michigan. Real estate is still very much a local issue.
If you want to learn more about Freddie Mac or see the details of their survey, go to: www.freddiemac.com and click on the link for "Current Weekly Survey". They break down the survey by specific regions in the United States so you can see how your state compares to other parts of the country. They also explain the mission of Freddie Mac and offer a lot of useful information for consumers.
If you would like to speak with a lender you can find some at my website: www.jelwell.century21bnr.com . You can also speak with your own bank, credit union, or mortgage broker to see what your particular interest rate would be should you decide to finance a home purchase.
Very recently Allstate Floridian asked for a 41.9% increase and Allstate Florida Indemnity asked for 28.3%.
The state's Office of Insurance Regulation has issued subpoenas to the Allstate Insurance companies operating in Florida, as well as Cincinatti Insurance and Cincinatti Indemnity to find out why predicted savings have not materialized. Both Cincinatti companies asked for an average 37.5% increase.
The state regulators would also like to learn any insurance companies are in anyway working together to get-around the reforms that were enacted.
It was noted that several smaller companies based in Florida have complied with the laws and have lowered their rates. It appears that it is the bigger companies that feel they do not have to play by the rules.
And so the seemingly never-ending insurance saga continues.
Building permits for private dwellings of any type numbered 1,226,000 in September. This is 7.3% below the August estimates and 25.9% below the rate a year ago. Single-family home building permits were at 868,000, 7.1% below August's figures.
Housing starts for privately owned housing units of any type numbered 1,191,000, 10.2% below the August estimate and 30.8% below September 2006. Single-family home starts numbered 963,000, 1.7% below the August figure of 980,000.
Housing Completions (all housing types) were at a rate of 1,391,000, 8.2% below the August estimate of 1,516,000 and 31.1% below September 2006. Single-family home completion numbered 1,095,000, 11.6% below August's figure.
Source: US Deparment of Commerce News Release
One wonders if this might be a good thing for those homeowners who are trying to sell their homes. In our area around Tampa, Florida, the developers offer VERY stiff competition to the private homeowners. Why would a buyer purchase a resale home for $200,000 when they can get a similar home that is brand new, has closing costs assistance, includes an appliance package, etc for $20,000 less? The truth is they can't. I have seen several inventory homes go for just slightly more than $100 per square foot. Those are prices we have not seen since 2003. With less new homes being constructed, this might help out many sellers. Those who will be hurt by this slowdown are the builders, their workers, and their suppliers. This can have a "trickle down effect" in many communities since unemployed workers do not have money to spend in stores, restaurants, car dealers, or new homes, for that matter. So what may be good for one sector will cause problems for others.
For more information or questions about this topic please call me at: 813-783-4444 or e-mail me at: jelwell1@tampabay.rr.com
I also invite you to visit my my website where I think you will find a lot of useful information. To get there just click on the following link: www.jelwell.century21bnr.com
The new agreement will probably contain some or all of the following:
It is estimated that making Save Our Homes portable will save the average homeowner about $800 per year. Increasing the Homestead Exemption could save an average taxpayer about $240 in 2008. The amount of each homeowner's savings will depend on which exemptions he or she qualify for.
One proposal also being floated would save first-time home buyers $500.
Of course, local governments that get most of their funds from property taxes are not happy and they worry that services will need to be cut and personnel laid off. Some of the more rural counties where the average home values are lower than those in more suburban and urban settings may feel the pinch to an even greater degree.
Personally, the insurance companies scare me more than the property tax situation. But it does not appear that the legislature will soon address this issue that is bound to heat up again in the future. But in regard to taxes, only time will tell if our lawmakers have done us a favor or only made matters worse. A year from know we will either be cheering or looking for tar and feathers.
For more information or questions about this topic please call me at: 813-783-4444 or e-mail me at: jelwell1@tampabay.rr.com
I also invite you to visit my my website where I think you will find a lot of useful information. To get there just click on the following link: www.jelwell.century21bnr.com
A perfect example happened to me yesterday. A young couple was interested in one of my listings. It was priced at just under $330,000. Large 2,600+ sq ft home on 3/4 of an acre, in a great but small subdivision of similar homes. The comparable homes told the owners and me that the price was right where it should be, though with some room for reasonable negotiation.
The young couple first saw it on Thursday and then returned with their parents on Friday. They spent a long time looking over the property and the accompanying documents. They seemed to like it very much, and their agent said they would likely make an offer of some type. I mused to myself that perhaps they would offer something like $300,000 which, though unlikely to be accepted by the sellers, was a good point to begin honest negotiations.
Yesterday I received the offer. Here are the main conditions that were contained in it:
When all was taken into consideration, they were offering the sellers over $50,000 less than the asking price! To the sellers it looked like the buyers were grabbing for all they could get. Perhaps the buyers were under the impression that the home was vastly overpriced, which it was not. Or perhaps they did not realize how asking for so much, even the little items, could be taken as an insult by the sellers.
I presented the offer in as positive a light as I could, but as the list of "wants" increased the sellers became less and less interested in dealing with these buyers. I urged them to think about it overnight and they agreed to do so. I was concerned that they might tell me that they would consider no more offers of any kind from these buyers. When I spoke to them the next day, their response was to say the offer was not yet a serious one. They would be willing to work with the buyers but only if the negotiations were reasonable. They made no counteroffer, but left the door open for the buyers to come back with something less "grabby".
I conveyed this message to the selling agent. Now we will just wait to see if they respond, or not. In this business you never know.
I had a similar home for sale a few weeks ago. The seller had been smart and had kept his price well below all of the comparables. So low, in fact, that other agents were complaining that their sellers could not compete. The price was $279,900 (recently reduced from $299,900) and some buyers made an offer of $255,000, CASH. The seller said he would take $262,000 which is a GREAT price for this home! However, when I conveyed this counteroffer to the buyers they still wanted to get another $4,000 off the price. I explained how this could look to the seller. I have worked with him for 9 months and know his temperment pretty well. I told them he could very well perceive their last offer as trying to "bleed him dry", break off negotiations, and order me to accept no more offers from the buyers. I told them I would certainly present their offer of $4,000 less, but that they should consider this carefully. In the end they decided not to chance it. We will be closing this week. They will be getting a great home at a great price and the seller will not have to deal with it any longer.
So when preparing an offer, think carefully about how it will be received. If your heart is not set on a particular property and you will not be disappointed if the sellers refuse to deal with you further, then go ahead and submit a lowball offer asking for everything you can. However, sellers, especially those who have priced their homes competitively may be insulted if you start asking for the moon. Good real estate agents can help you navigate this whirlpool of negotiations. If they are familar with the local market conditions, they can help you find that entry point for your offer and advise you as to how hard to push on other issues.
Both buyers and sellers want prices that they can live with. The trick is to find that middle ground. Just be sure that when you begin the process you do not get tossed out of the negotiating game before you have a real chance of participating.
For more information or questions about this topic please call me at: 813-783-4444 or e-mail me at: jelwell1@tampabay.rr.com
I also invite you to visit my my website where I think you will find a lot of useful information. To get there just click on the following link: www.jelwell.century21bnr.com
WASHINGTON, October 10, 2007
Conditions in the mortgage market are improving for consumers, which should help to release some pent-up demand in early 2008, according to the latest forecast by the National Association of Realtors®.
Lawrence Yun, NAR senior economist, notes that widening credit availability will help turn around home sales. “Conforming loans are abundantly available at historically favorable mortgage rates. Pricing has steadily improved on jumbo mortgages since the August credit crunch, and FHA loans are replacing subprime mortgages,” he said.
Yun said it’s important to place the current housing market in perspective, and that 2007 will be the fifth highest year on record for existing-home sales. “Although sales are off from an unsustainable peak in 2005, there is a historically high level of home sales taking place this year – a lot of people are, in fact, buying homes,” he said. “One out of 16 American households is buying a home this year. The speculative excesses have been removed from the market and home sales are returning to fundamentally healthy levels, while prices remain near record highs, reflecting favorable mortgage rates and positive job gains.”
He emphasized all real estate is local with naturally large variations within a given area. “Markets like Austin, Salt Lake City and Raleigh have been outperforming recently and will continue to do well next year,” Yun said. “Other areas like Denver and Wichita will likely move up in the price growth rankings due to very positive local economic developments.”
Existing-home sales are expected to total 5.78 million in 2007 and then rise to 6.12 million next year, in contrast with 6.48 million in 2006. New-home sales are forecast at 804,000 this year and 752,000 in 2008, down from 1.05 million in 2006; a recovery for new homes will be delayed until next spring.
“A cutback in housing construction is a positive sign for the market because it will help lower inventory and firm up home prices,” Yun said. Housing starts, including multifamily units, are likely to total 1.37 million in 2007 and 1.24 million next year, down from 1.80 million in 2006.
NAR President Pat V. Combs, from Grand Rapids, Mich., and vice president of Coldwell Banker-AJS-Schmidt, said, “Housing is still a good long-term investment, and we’ll be seeing a broad, modest improvement in home prices in 2008. With widely varying conditions, the best advice for consumers is to consult a Realtor® in their area to learn about local market conditions because supply and demand can change from one neighborhood to the next.”
Existing-home prices will probably slip 1.3 percent to a median of $219,000 in 2007 before rising 1.3 percent next year to $221,800. The median new-home price should drop 2.1 percent to $241,400 this year, and then increase 1.0 percent in 2008 to $243,900.
The 30-year fixed-rate mortgage is expected to average 6.4 percent for the next two quarters and then edge up to the 6.6 percent range in the second half 2008. Additional cuts expected in the Fed funds rate will help to keep mortgage interest rates historically favorable.
Growth in the U.S. gross domestic product (GDP) is estimated at 2.0 percent this year, below the 2.9 percent growth rate in 2006; GDP is likely to grow 2.7 percent next year.
The unemployment rate is forecast to average 4.6 percent this year, unchanged from 2006. Inflation, as measured by the Consumer Price Index, is expected to be 2.8 percent in 2007, compared with 3.2 percent last year. Inflation-adjusted disposable personal income will probably increase 3.6 percent in 2007, up from 3.1 percent last year.
Source: National Association of REALTORS Press Release
An increase in jobs by 110,000 in September, along with revised figures for July and August worked to tip the interest rates very slightly higher. This indicated that the economy may be stronger than had been expected.
Observers of financial markets now feel that it is less likely that the Federal Reserve will cut interest rates at their scheduled meeting at the end of October.
Do keep in mind that we live in a very large and complex country. What happens in California is not necessarily what is happening in Florida. And what happens in Florida may be a far cry from what occurs in Michigan. Real estate is still very much a local issue.
If you want to learn more about Freddie Mac or see the details of their survey, go to: www.freddiemac.com and click on the link for "Current Weekly Survey". They break down the survey by specific regions in the United States so you can see how your state compares to other parts of the country. They also explain the mission of Freddie Mac and offer a lot of useful information for consumers.
If you would like to speak with a lender you can find some at my website: www.jelwell.century21bnr.com . You can also speak with your own bank, credit union, or mortgage broker to see what your particular interest rate would be should you decide to finance a home purchase.
Yesterday I informed you that the Florida legislature had reached an agreement concerning budget cuts and was set to vote it into law on Friday. Passage was almost a certainty. However, now I hear that Governor Crist is pushing them to continue on during this special session to address property tax reform, rather than have another session later in the month.
The urgency is caused by the fact that if a new tax reform proposal is to make it to the January 2008 ballot, it must be ready by the end of October. If you remember, a circuit court judge recently declared the previous ballot proposition to be "misleading" and took it off the ballot. Crist is advocating a simpler plan that would offer less tax savings. Some of his ideas are: doubling the current $25,000 homestead exemption, keep Save Our Homes intact, make it portable, protect marinas from tax rate spikes, give first-time home buyers a 25% reduction in their tax bills, and provide a variety of items that could give up to $25,000 in tax cuts to many businesses.
Don't you sometimes get the feeling that we are on a merry-go-round and can't get off? Will anything they do in Tallahassee do us any good? Insurance reform sure was a bust, as far as I can tell. My bet is that property tax reform will turn out just about the same way. Wait and see.
For more information or questions about this topic please call me at: 813-783-4444 or e-mail me at: jelwell1@tampabay.rr.com
I also invite you to visit my my website where I think you will find a lot of useful information. To get there just click on the following link: www.jelwell.century21bnr.com
A rate hike by USAA, a company that insures military personnel, was rejected by the Florida insurance regulators. The company had been asking for a nearly 54% increase in premium rates. They said this was necessary to cover future losses. They also said that reinsurance (insurance that insurance companies buy to protect themselves from big losses) now cost more. I thought that the reforms put in place last winter were supposed to make reinsurance more available and cheaper. Go figure.
The rejection was partly due to the fact that the company officers had not certified that the information they had submitted was "true and accurate", as required by the Office of Insurance Regulation. Apparently in the past they could just shove figures at the state and then claim they were unaware of any errors in the data. Now they must attest under oath that the information they are giving is correct, or face perjury charges.
So this rejection may be based on a simple technicality. It will be interesting to see what the state allows them to do if they submit the request correctly. However, 54% is a huge increase and seems to fly in the fact of the insurance reforms that we were promised. Starting to look like business as usual, as far as insurance is concerned in Florida.
PS Dave Snowden of USAA has left a comment for this post with more information. Click on the comment link below to read what he had to say.
For more information or questions about this topic please call me at: 813-783-4444 or e-mail me at: jelwell1@tampabay.rr.com
I also invite you to visit my my website where I think you will find a lot of useful information. To get there just click on the following link: www.jelwell.century21bnr.com
Lawmakers tried to avoid cutting in areas that would raise the hackles of the voters, such as schools, health care, and other state services that many depend on. Some money was taken from the state's reserve funds. However, I have yet to hear where the other cuts are going to take place. The money has to come from somewhere.
The lawmakers did appropriate some money for a special election to fill vacant legislative seats and some other minor costs. Though these are miniscule in comparison to the total budget cuts.
This session did nothing concerning the property tax reforms that have been in limbo since a circuit court judge declared them misleading and struck them off the ballot that we were to vote on in January 2008. Now it appears that Save Our Homes is back in the center ring of this circus we call a state government. So what happened to the Super Homestead Exemption? Another special session has to be held before the end of October if any proposition is going to be presented to the voters in January. It will be interesting to see where the spinning elephant stops and the trained monkeys jump off.
For more information or questions about this topic please call me at: 813-783-4444 or e-mail me at: jelwell1@tampabay.rr.com
I also invite you to visit my my website where I think you will find a lot of useful information. To get there just click on the following link: www.jelwell.century21bnr.com
So, what were the results? The majority of the homes had 0 visitors. The others had one or two persons or couples who stopped by to tour some of the homes, and out of those, only 3 individuals were identified as possibily being serious buyers! This is pretty consistent with the results that I have had in the past when I have had my own openhouse events for sellers.
I know from what I see on some TV real estate shows that openhouses are more popular and common place in other parts of the country. But here in the Tampa Bay area of Florida they are not. I think part of this is due to the lack of time people have. Driving around and looking at homes that may, or may not meet their requirements does just not appeal to them. Add into that the high cost of gas and that makes a home search safari a more expensive trip. I also think the diminishing power of the print ads is a part of the problem. It used to be that most people started a home search by combing through the ads in the newspapers. And that is where most openhouses are advertised. If they don't look there they do not even know an openhouse is going on.
In my opinion, I think most buyers today prefer to search on the internet and then work with one agent who locates homes that meet their very specific requirements and takes them on tours of those particular homes. After spending time with buyers, agents get to know what they do and do not want to see. With the limited information that openhouse hosts can give out in a print ad, it is only logical that many of the homes are a waste of time for many buyers. They would rather work with their personal agent who knows the local inventory, and also knows them and what they want.
Sellers still sometimes ask about having openhouses at their homes, but more and more they are coming to realize that the time, money, and bother are better spent on other ways of getting their homes exposure. It could be that the day of the openhouse is over, just like that of the dinosaurs and homes without internet connections.
I just received this message from Tom Rinnicker, one of our local ASHI certified home inspectors. I thought it might be of interest to some of my readers.
John Elwell
Here’s a bit of legislation which just went into effect this week and was missed by many people:
Effective 1 Oct 2007, new requirements for roof replacement on a site-built, single-family residential structure went into effect. The changes are in effect now and will be incorporated into the next edition of the Florida Building Code. The two significant additions are:
-A roof replacement must incorporate a secondary water barrier
-A roof replacement must incorporate strengthening or correcting roof-decking attachments and fasteners.
There is still a considerable amount of controversy about this issue, partly because most roofers cannot do the prescribed roof-decking attachment modifications.
So what does this mean in the perspective of a home sale? Although there will be long term benefits from the additional Wind and Hurricane resistance, these new requirements will probably add substantially to the cost of a roof replacement. An already major item is now much more significant due to this additional cost. It is now more important than ever that roof issues are thoroughly documented and resolved to avoid those post closing problems that we all hope to avoid. Also, if the roof was replaced after 1 Oct and these improvements not made, there are even more questions to be answered.
These changes are all a part of the legislation governing the My Safe Florida Home Program. For additional information on the program visit www.mysafefloridahome.com Keep in mind that anyone can request the free Wind Mitigation inspection provided the home is a single family detached site built home (no manufactured home). Application can be made through the website.
As always, I appreciate your referrals! I look forward to working with you and your clients!
Tom Rinicker
ASHI Certified Inspector #203580
ICC Residential and Electrical certified
MySafeFloridaHome Wind Mitigation Surveyor
Commercial and Residential Windstorm Mitigation Inspector
813-300-5027
Today 10/4/07, Freddie Mac reported that the average mortgage interest rates for 30 and 15 year fixed-rate loans went down slightly from last week's averages. Nationally the average mortgage interest rate for 30 year fixed-rate mortgages was 6.37% (6.26% in the southeast), down from 6.42% a week ago. The average interest rate for 15 year fixed-rate mortgages was 6.03%, down from 6.09% last week.
Mortgage rates finally dropped a bit after 3 weeks of increases. "The initial effects of the credit market turmoil that began in August are starting to emerge in housing statistics" said a Freddie Mac spokesman. The sales of new homes were the lowest in more than 7 years and median sales prices had the biggest 12 month decline since 1970! In addition, August's pending home sales dropped to the lowest level on record (record keeping of this data began in 2001).
Before August 2007 there were already 260,000 jobs lost in the housing market from August 2006 to July 2007. But the overall employment figures showed that 1.8 million new non-farm jobs were added over the same period.
Source: Freddie Mac Press Release
Do keep in mind that we live in a very large and complex country. What happens in California is not necessarily what is happening in Florida. And what happens in Florida may be a far cry from what occurs in Michigan. Real estate is still very much a local issue.
If you want to learn more about Freddie Mac or see the details of their survey, go to: www.freddiemac.com and click on the link for "Current Weekly Survey". They break down the survey by specific regions in the United States so you can see how your state compares to other parts of the country. They also explain the mission of Freddie Mac and offer a lot of useful information for consumers.
If you would like to speak with a lender you can find some at my website: www.jelwell.century21bnr.com . You can also speak with your own bank, credit union, or mortgage broker to see what your particular interest rate would be should you decide to finance a home purchase.
It is being reported that State Farm Insurance Company has finally reached an agreement with the State of Florida concerning rate cuts and other business practices. The gist of this agreement is:
Many policy holders should receive a refund since the initial reduction of 7% was not sufficient in the state's eyes. So that further 2% reduction is apparently retroactive, and that over payment is to be refunded, from what I read. Imagine that, an insurance company giving customers some money back!
State regulators are getting miffed at the insurance companies and want to know why they are not passing on the savings they receive from having easier access to back-up coverage from the Florida Hurricane Catastophe Fund. In many cases, these companies who are paying less for reinsurance coverage are in fact asking for rate increases.
At least with this latest surrender by State Farm, the largest property insurer in the state, the other companies will hopefully get the message that the government and the citizens of Florida have had ENOUGH!
For more information or questions about this topic please call me at: 813-783-4444 or e-mail me at: jelwell1@tampabay.rr.com
I also invite you to visit my my website where I think you will find a lot of useful information. To get there just click on the following link: www.jelwell.century21bnr.com
The Pending Home Sales Index*, a forward-looking indicator, fell 6.5 percent to a reading of 85.5 from an upwardly revised 91.4 in July, based on contracts signed in August. It was 21.5 percent below the August 2006 index of 108.9.
Lawrence Yun, NAR senior economist, said the mortgage market impact is quantifiable. “Fewer contracts were being written because of mortgage availability issues, and a separate internal survey of our members shows more than 10 percent of sales contracts fell through at the last moment in August, primarily the result of canceled loan commitments,” he said. “The volume of activity we’re seeing today is below sustainable market fundamentals because some creditworthy people are trying to buy homes but can’t because of the credit crunch.
“The impact was greater in high-cost markets that are more dependent on jumbo mortgages. In some areas, as much as 30 percent of signed contracts were falling through in August when the credit crunch problem peaked,” Yun said. “The problem has since become less severe, though jumbo loan rates are still higher than they would be under normal conditions. Therefore, sales activity in late fall will better reflect market fundamentals.”
The index is a leading indicator for the housing sector, based on pending sales of existing homes. A sale is listed as pending when the contract has been signed but the transaction has not closed, though the sale usually is finalized within one or two months of signing.
Annual changes in the index are more closely related to actual market performance than are month-to-month comparisons. As the relatively new index matures and seasonal adjustment factors are refined, the month-to-month comparisons will become more meaningful.
An index of 100 is equal to the average level of contract activity during 2001, which was the first year to be examined as well as the first of five consecutive record years for existing-home sales.
The PHSI in the West was down 2.7 percent in August to 80.3 and was 27.1 percent below a year ago. In the Midwest, the index fell 2.9 percent from July to 78.1 and is 18.0 percent lower than August 2006. The index in the Northeast fell 8.3 percent in August to 77.3 and was 18.3 percent below a year ago. In the South, the index dropped 9.5 percent in August to 97.8 and was 21.3 percent below August 2006.
Source: National Association of REALTORS Press Release
In testimony today before the Senate Banking Committee, the National Association of Realtors® expressed support for reforming and expanding the National Flood Insurance Program. The NFIP helps protect homeowners, renters and commercial property owners from losses sustained from flooding.
Since its creation, the NFIP has helped reduce the escalating costs of repairing flood-related damage to homes, buildings and contents in participating communities. “A strong real estate market is the linchpin of a healthy economy,” said NAR President Pat V. Combs, of Grand Rapids, Mich., and vice president of Coldwell Banker-AJS-Schmidt. “To ensure that real estate continues to be a good long-term investment and maintain vitality in the residential and commercial markets, certain safeguards must be in place, including federally backed flood insurance made available through the NFIP.”
The NFIP is a unique partnership between local, state and federal governments. It allows participating communities to purchase insurance as protection against flood losses in exchange for state and community floodplain management regulations that would reduce future flood damage. In exchange, the NFIP makes federally backed flood insurance available to homeowners, renters and business owners in these communities. More than 20,000 communities currently are participating in the NFIP.
Testifying on NAR’s behalf, 2006 California Association of Realtors® President Vince Malta said, “The NFIP is a win-win in that it promotes responsibility by homeowners, the community and the government. Compliance with NFIP building standards resulted in nearly 80 percent less damage annually. In addition, the cost of flood damage was reduced by nearly $1 billion because communities are implementing sound floodplain management requirements and property owners are purchasing flood insurance.”
NAR supports reforms that protect the integrity of NFIP by fully fu
