Florida Real Estate Blog

Tampa Area Housing Recovery Predicted for Second Half of 2008

Lawrence Yun, the chief economist for the National Association of REALTORs was in Tampa recently. He had some good news for home buyers, sellers, and REALTORS in the west central area of Florida.

It is his opinion that recovery should begin after August of this year. Though we hear doom-and-gloom on the television, Yun said there are several indicators that could be omens of better days to come.

1. It appears that the worst may have already passed us in the Tampa area.

2. There are many qualified home buyers who have been sitting on the fence for a long time and there is increased pressure for them to make a move in the future. Fears that mortgage rates and home prices could rise may push them off that fence.

3. Risky loan products are now being replaced by safer lending products.

4. Mortgage rates remain at historically low levels.

5. Housing starts are way down and this allows stale inventory to disappear, thus creating greater demand in the coming months and next year.

For those of us who have been around a while, we know that our current situation is not all doom and gloom. We are not in the boom of a couple of years ago, but we are not doing all that badly. Do any of you remember back in the late 70's and early 80's when mortgage interest rates were nearly 20%??

I will close on 3 homes next week. Sellers are selling and buyers are buying. The important thing is that buyers and sellers see our current situation in realistic terms and not dwell on the minuses. There are some, but there are lots of great plusses too. Like low interest rates, low home prices which translate into lower property taxes and lower insurance rates. More homes to choose from so sellers will negotiate.

It will be interesting to see if Mr. Yun's forecast comes true. I for one am optimistic!

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

Mobile Homes Selling Briskly in Zephyrhills and in the Rest of Florida

One of the agents in our CENTURY 21 office always says that "In January buyers kick the tires on the vacation homes here, and then make their decisions to buy in February, March, and April". That seems to be holding true this year as well. As a plus for buyers, this year there are many more homes on the market, and sellers are pricing their homes more reasonably and are often willing to negotiate.

If you are looking for a vacation home or permanent residence in Zephyrhills, Dade City, Wesley Chapel, North Tampa, North Lakeland, or the general Pasco County area of Florida, do not hesitate to contact me. I can e-mail you the most recent listings directly from the MLS. Often listings from other sites are outdated, sometimes by several months. I can also set up an auto-search for you so you will be notified immediately as soon as a new listing comes on the market.

You can 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

Homeowners Finally Competing Head-to-Head With Developers/Builders on Home Prices

For several months now you have heard me mention again and again how many home sellers were asking for more money per square foot than the developers were. It made little sense to me that a buyer would pay $134/sq ft when a developer would sell them a brand new home for $100/sq ft. Yet sellers would stubbornly hold on to the dream of hitting a jackpot while the developers sold off their inventories.

Now we are seeing that the light of reality has finally begun to shine on many sellers and they are giving some of the developers a run for their money. The builders are limited to the costs of constructing a home in today's economic circumstances. Resellers, however, are limited only by the price they paid for their homes. And if they purchased then several years ago, they can undercut the prices of the builders and still make a profit.

As an example, in our area we have a large subdivision called Lake Bernadette. It was started in the 1980's but construction continues to this day in various parts of it. I recently pulled up the MLS listings that were currently on the market. Of the 56 that came up as "active", half of them were at, or very close to, $100 per square foot. A few were substantially under that amount. This tells me that homeowners are not telling their agents to be more aggressive in their pricing and are offering their properties for realistic amounts that compete well with the builder/developers.

What also helps the homeowners at this time is the cut-back in new construction that is taking place. We have several subdivisions near our office that have streets, lights, stop signs, etc, and not a single home under construction. They have sat this way for many months. This lack of of additional inventory each month can only help those sellers who want to move their homes.

So if you home has been languishing on the market for months, or in some cases years, take a lesson from your neighbors who are going after those buyers who will pass you by on the way to the homes that are reasonably priced.

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

Housing for Older Persons and 55+ Communities Near Zephyrhills, Florida

Long ago Zephyrhills, Florida became somewhat of a mecca for home buyers looking for a place to retire. As a consequence, we have several subdivisions that house mainly persons who are 55 years of age, or older.

According to federal law it is illegal to discriminate against someone based on "familial status". That is to say, a family with a child or children under the age of 18. I cannot refuse to show a home to anyone because the owners or neighbors do not want children nearby. If I did that, there would be serious consequences for all concerned.

There are only two exceptions to this law, and both involve housing for older persons. One is for subdivisions that are used to house people 62 years of age, or older. These are seldom seen in this area since the requirements are much harder to meet.

The second exception is much more common and involves housing for 55+ individuals. There are many subdivisions in our area that fall into this category.

The Housing and Urban Development website says that a subdivision qualifies as housing for 55+ individuals if:

"It houses at least one person who is 55 or older in at least 80 percent of the occupied units, and adheres to a policy that demonstrates an intent to house persons who are 55 or older"

The State of Florida has an online registry of subdivisions that have filed their intentions to function as 55+ housing. You can check for 55+ subdivisions in your county by going to:  http://fchr.state.fl.us/fchr/55_communities__1 and clicking on your county's name.

Note that the state says that just because a subdivision is listed does not guarantee that they meet the requirements for this designation. They do not verify the information that they receive, but rely on what the subdivisions' homeowners associations tell them. They also say that if a subdivision does not appear, they may still qualify as a 55+ subdivision. Can be confusing at times, I know.

As of 12/28/06 here are some of the subdivisions in the Zephyrhills area of Pasco County, Florida that appear on the state's 55+ list. Be aware that I am only listing those subdivisions where you own the home AND the land. I am NOT listing rental mobile home parks where you own the mobile but rent the lot it is on:

• Betmar Acres Club
• Colony Hills Community Association
• Driftwood Condo Association*
• Driftwood Homeowners Association*
• Florida Estates, Inc.
• Forest Lake Estates
• Gem Estates
• Oaks Royal
• Orange Blossum Ranch*
• Palm Estates
• Shady Oaks
• Spanish Trails
• Terrace Park Estates
• Tippecanoe Village
• Tropical Acres Estates
• Valleydale RO Association
• Zephyr Shores

* Conventional construction, ie single-family homes, villas, condominiums, etc. The rest are mobile home subdivisions.

I believe this information to be correct, but you should go to the state's webpage at: http://fchr.state.fl.us/55+_registered_list.htm to confirm this data since it can change at ANY TIME. You can also check to see if a particular rental park is listed there.

As the state webpage states, other subdivisions may meet the requirements for being a 55+ subdivision. They may not have filed with the state yet, or their names have not yet been put on the state's database due to a backlog of applications.

I am NOT an attorney and cannot give you legal recommendations. So if you go to a subdivision that is not on the state's list, and someone tells you that children are not allowed there, or if you have any questions about the application of this law, you would be well advised to ask an attorney for legal advice.

You can also seek guidance from the local HUD field office. It is located at: 500 Zack Street, Suite 402, Tampa, Florida  33602  Tel: 813-228-2026

Or visit the HUD website at: http://www.hud.gov/groups/55older.cfm

I am very familiar with the 55+ subdivisions in and around Zephyrhills. I would be happy to help you find a home here. You can contact me by calling: 813-783-4444 or e-mail me at: jelwell1@tampabay.rr.com  I also invite you to visit my webpage at:  www.jelwell.century21bnr.com

Mortgage Interest Rates Plummet For Another Week Says Freddie Mac

It may be hard to believe, but today 1/24/08,  Freddie Mac reported that the average mortgage interest rates for 30 year and 15 year fixed-rate interest rates dropped AGAIN substantially! Nationally the average mortgage interest rate for 30 year fixed-rate mortgages was 5.48% (5.46% in the southeast), down from 5.69% a week ago. This is the lowest it has been since March of 2004! The average interest rate for 15 year fixed-rate mortgages was 4.95%. down from 5.21% last week and for the first time in a long time it has gone below 5.0%.

Reports of lower housing sales in 2007, as well as a drop in building permits for future construction were indicators of a slowing economy and this helped cause another big drop in rates..

The interest rate drop was also helped by the Federal Reserve's drop in one of its key interest rates that I mentioned recently. They dropped it 0.75%. The drop along was large and it was also unusually in that the Fed did not wait until one of its regular meetings to act. The last time they took a similar unexpected action was just after the attacks of September 11, 2001. This time their cuts appear to have helped lower mortgage interest rates as well. When the banks have to pay less for money they get from the Fed, they can charge us less when we borrow it.

I hate to keep repeating this like a broken record, but with interest rates and home prices BOTH at low levels, this is a time for buyers who have been sitting on the sidelines to think about making a move. At some point either interest rates or home prices will start to rise, perhaps significantly. Both have lower limits below which they cannot practically go beyond. For example, developers will not build and sell homes that they cannot sell for enough money to cover their costs. Have we reached that point? In my opinion, we are close to it, if not already there. Do not wait too long or you might miss out on some great deals. As for how low interest rates may drop, their are many that think they can still go a bit lower if the Fed feels that it is necessary to stimulate the economy. But again, there will be a limit below which they will not be able to go.

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.

Now May Be The Time to Purchase a Home, At Least in Florida

Notice this image of the scales. Normally, when one side goes down, the other side goes up. That is usually the relationship between mortgage interest rates and home prices. When interest rates are low, more people can get loans for larger amounts. This causes more demand for homes so the sellers can demand higher prices.

When interest rates go up, fewer people can qualify to borrow money, thus the sellers must lower the prices of the homes in order to be able to market them.

At this point in time, though we hear doom and gloom on the news, for buyers who have been sitting on the sidelines, this may be a great time to make that puchase. Interest rates are the lowest they have been in quite a while, yet home prices are also down. In our area outside of Tampa, several developers are now selling homes for less than $100 per square foot! They have not done that since before the "boom". When you consider the rising costs of materials, it is doubtful that they can go much lower and not lose money. Have we hit the pricing bottom? There are never guarantees, but I bet we are pretty close. Even sellers of existing homes are finally getting the message. They must price their homes attractively, or they face months, if not years, sitting on the market.

I have an uncle who plays the stock market a bit. He does not wait until a stock's price hits rock bottom since no one can predict when that will happen. But when a sound stock's price gets historically low, he begins to buy. Even if the price drops a bit lower he knows that if the company is sound, eventually the price will rise above what he paid for the stock and he will make a profit.  In the same way, over the centuries, real estate has been a very good investment. Certainly better than renting. If you see some housing bargains out there, now may be the time to take advantage of low interest rates and make that buy.

One word of warning that I would give is that in today's market, it is very important to have a good credit history. Though it is not impossible to get a loan with less than perfect credit, it is infinitely harder than it was a few years ago. Subprime loans are almost a dirty word. However, if you have created an excellent credit record, the lenders will be happy to work with you to get you into your new home.

So now we have an unusual situation, interest rates are down and home prices are down. It is not often when both sides of the the scales DROP. At some point the Federal Reserve will become afraid of inflation and raise interest rates. Or the costs of fuel, and thus building materials, will force developers to charge more for their homes. In either case, you will be paying more for a home that you can buy for much less now.

One final note, when you buy at a lower price your insurance rates will be less and so will your property taxes, since both of these are directly linked to the value of your home. Keep that in mind.

And for those individuals who are waiting for prices to increase before they list their homes, keep in mind that the home you will buy once you sell your current residence will also have a higher price on it. Get 10% more for your current home, pay 10% more for your next one.  And as I mentioned in the previous paragraph, at the higher price your insurance and taxes will cost you more too.

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

Beware of Unlicensed Real Estate Agents or Brokers in Zephyrhills and the State of Florida

It has come to my attention that we may have an unlicensed person acting as a real estate agent in one of our subdivisions. He approaches buyers and sellers and offers to sell homes for a pretty hefty fee, considering the limitations of his services. This is a dangerous practice for sellers and buyers, and could have serious consequences for both parties in the transaction. Any potential savings could be rapidly eaten away when things go wrong. A real estate professional with an active license will always be happy to show it to you.

The State of Florida has issued an advisory to let citizens know that it is never a good idea to work with unlicensed contractors, especially for real estate transactions. On their website they mention the reasons why a person may not have a license:

• may not be able to meet the financial requirements;
      
• may not be able to pass a background check;
      
• may not meet the education or experience (skill) requirements;
      
• may not meet the workers’ compensation requirements; and/or
      
• may not meet the liability insurance requirements

Think about these points carefully. If a person cannot meet the financial requirements, is this the person you want handling large sums of your money when you sell or buy a home? Is the escrow deposit safe?

When I got my license I was fingerprinted and a background check was done to be sure I had no previous trouble that would prevent me from being licensed. If someone cannot pass a background check, you need to wonder "why"? Is there a felony conviction somewhere? Has the person committed some other unlawful act? If they have, is this who you want to have in control of one of your most valuable assets?

If the person does not have the required training, how will you know if things will be handled correctly? There are many regulations that cover the sale of real property, and these change frequently. For example, did you know that if your home was built before 1978 you must give the buyers a "Lead Disclosure Form" and a booklet concerning the dangers of lead contamination? Most people don't. Only by using a licensed agent can you be sure that your representative is up-to-date concerning the latest developments in the real estate market and the laws that pertain to it. Also, keep in mind that, legal issues aside, a lack of training will make your person less able to effectively price your home, market it, and negotiate the best deal for you. Unlicensed agents do not have access to the Multiple Listing Service (MLS). Where are they pulling their prices from? Out of thin air or their hunches? If they price your home too low you will lose money, and if they price it too high it will sit and sit while you pay HOA fees, taxes and maintenance.

Unlicensed agents cannot belong to the National Association of REALTORs (NAR) and therefore do not have to adhere to the high level of ethical conduct that NAR members follow. In our  treatment of customers we try to go far beyond what the law requires. Will an unlicensed person do the same?

According to Florida Statute 475.42  "A person may not operate as a broker or sales associate without being the holder of a valid and current active license therefor. Any person who violates this paragraph commits a felony of the third degree, punishable as provided in s. 775.082 or s. 775.083.."

The penalties for being convicted of this crime according to s. 775.082  are a $5,000 fine and according to s. 775.083 a term of imprisionment not exceeding 5 years. These are not "slap on the hand punishments".

Also consider this. If by selling your home an unlicensed contractor is willing to commit a 3rd degree felony, is this the type of person you wish to be dealing with? Would you go to an unlicensed doctor because he was cheaper and would you disregard that he was committing a serious crime? I sure wouldn't.

Suppose you are already dealing with an unlicensed person acting as a real estate agent or broker, and for whatever reason you do not wish to pay him or her? Here is what Florida law has to say about that. And this is directly from the state's website: "Chapter 475.41 Contracts of unlicensed person for commissions invalid.--No contract for a commission or compensation for any act or service enumerated in s. 475.01(3) is valid unless the broker or sales associate has complied with this chapter in regard to issuance and renewal of the license at the time the act or service was performed." No license, no obligation to pay. Seems like years ago I was watching the original "People's Court" on television, and old Judge Wapner said that a contract to commit an illegal act cannot be enforced. So perhaps that is what is coming into play here. But I am not a lawyer, and I am sure one of them can explain it much much better.

So please play it safe and deal only with licensed agents. Think twice before you jeopardize your biggest asset by using an unlicensed real estate agent just to save a few bucks (which you may very well lose in the end anyway). At the very least consult with an attorney to make sure everything is being done correctly and you are not paying fees to someone that could be literally committing a third degree felony.

To see the documents from the state concerning unlicensed activity, click on the following links:  Download Toll-Free_Press-Release.pdf     Download 800-Number.pdf

If you think you have dealt with, or are dealing with, an unlicensed individual, in Florida you can call the state to report this at: 1-866-532-1440   You can also download the complaint reporting form by clicking here: Download unlicensed_complaint_form.pdf  You can also check on the license status of an individual by clicking on this link: Licensee Search - REAL ESTATE

You can also e-mail me at: jelwell1@tampabay.rr.com , and I will do my best to assist you with questions concerning how to handle unlicensed activity.

In Florida, Buy a Mobile Home on a Rental Lot in Haste, and Repent at Leisure

There is an old proverb that says "Marry in haste, and repent at leisure". I suspect many a visitor to those little wedding chapels in Las Vegas can attest to the validity of this saying. Here in the Zephyrhills area of Florida I often have home buyers call me and they tell me that they have seen a mobile home for sale for just $15,000! Now that is an unheard of price here unless the home is in ruins. What turns out to be the case, is that the home is located in a park where you do not own the lot. You rent the land from the park owner, which is often a larger company.

Unfortunately, what sounds cheap can quickly become very expensive. First, keep in mind that you will be obligated to pay monthly rent to the land owner which can commonly range from$200 to $500+, depending on the location. Not only that, but you will not likely have any say in future rent increases. If they become too high your only options will be to either sell your home or have it moved. Not a cheap operation.

Second, the management will make all the rules that you will have to follow. They may accept suggestions, but they have the final say. Afterall, to them, you are just tenants.

Third, the rent you pay will probably not be deductible on your income tax returns (confirm this with your personal accountant or financial advisor). But do not think you will not be paying taxes. A part of your monthly rent check will go towards the taxes, yet it will be the landlord that gets to claim the deduction as a business expense.

Fourth, what will happen if at some point the park gets sold to a new owner who wants to use the land for some other purpose? Where will that leave you?

Fifth, in general, mobile homes on rental lots are treated much like an RV or travel trailer. They are not considered real estate, and therefore their value decreases over the years.

Sixth, financing a home on a rental lot can be difficult to obtain, and the terms are often less attractive since basically you are buying a vehicle, not a home.

Seventh, every year you must pay for a new vehicle registration sticker for your home, just as most of you do for your automobiles.

Finally, at least in Florida, a real estate agent cannot sell a home on a rental lot. You need a dealers license to do that, and few real estate brokers have them. That leaves you at the mercy of the park management to try to sell your home, or sell it yourself via posters or ads you place in newspapers. Our Multiple Listing Service will not allow us to put homes on rental lots into the system since they are not considered real property. This can severely hinder your marketing abilities and cost you a good price. At least once a week I have someone call me asking me to help them sell their rental lot home, but there is very little I can do.

So though the initial prices may be attractive, buyers will very quickly see that the costs on the backside start to mount up rapidly.

Since I am a REALTOR® I deal strictly with buyers who want to purchase mobiles on their own land. Do these homes cost more? Of course. However, there are many benefits.

• If a mobile on its own land is properly maintained, the value of the property will generally increase, unlike homes on rental lots.
• If the home is your permanent residence, you can take advantage of the Homestead Exemption and others to reduce your property taxes.
• As a homeowner in the subdivision you will help elect the governing board of directors and have a say in fee increases, subdivision rules, improvements, etc. The owners are the bosses.
• When you decide to sell your home you can use a real estate professional with all of his or her resources and knowledge, therefore getting the best price possible for your home.
• You will not have to register your home every year since it will be considered "real estate" and will be taxed accordingly. You will probably be able to deduct these taxes from your income tax returns.
• Fees will, in general, be much less. I know of several fine mobile home subdivisions where the fees range from $18 to $50 per month. That is a lot lower than the costs in rental parks. And keep in mind that it is you as a homeowner that helps determine what the fees will be, not a landlord.
• Since the home is considered real property, financing can be easier to obtain. And the interest that you pay can often be used as a tax deduction (See your accountant). Rent is just "money down a rat hole", as my grandfather used to say.
• If you get a mortgage, often the monthly payment is not all that much more than the monthly fee that you would pay in a rental park. Something to think about.

So before you make an offer on what appears to be a great bargain, think carefully about the pros and cons of buying a mobile home in a rental park. Perhaps in your case it is the best way to go. But I bet that in most cases buying a home on your own land will be the better investment in the long run.

Keep in mind that the above post is written from my perspective here in Florida. Some parts may or may not apply in other parts of the country.

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

Even Though It's a Buyers Market, Don't Insult the Home Sellers With Ridiculous Offers

A few weeks ago I posted an item about the importance of knowing which sellers were offering a reasonable price and which were shooting for the stars. Each of these must be handled differently when you are considering what to offer them for their homes.

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:

• $295,000
• Closing date nearly 3 months in the future.
• Home Warranty paid for by the sellers.
• Washer, dryer, and spa; though they had been told specifically that these were not included in the sale.
• 30 days to get financing approval.
• And to top it off, they wanted the sellers to pay over $17,000 of their closing costs and prepaid items.

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 

Buyers Must Distinguish Between Sane and Crazy Sellers

In today's real estate market there are two types of sellers that many agents and buyers will encounter. The first is the "crazy" seller. Not that he is really crazy, but his mind-set has not caught on to the reality of the home market as it is today. He thinks that prices are still increasing at a break-neck speed as in 2004 and prices his home accordingly. That is to say, way above what the market will bear. This seller often thinks his home is "special" and better than all of the other comparable homes on the market and prices it higher than all of the competition, even though his REALTOR may have strenuously advised him not to.

The other seller is the "sane" seller. He has kept up with the news and listens to his agent. His home is priced reasonably, often just a little lower than the competition. This seller may have been a "crazy" a few months ago, but has learned that wanting a price and finding a buyer willing to pay it, are two very different things. He has "seen the light", so to speak.

Buyers, with the assistance of their agents, must identify which of these sellers they are dealing with. If you are dealing with a crazy seller who has over-priced his home considerably, it may be logical to offer much much less for the home based on what homes are actualy selling for in the same area. An offer that is $50,000 or $100,000 less than the asking price may be reasonable. The seller may not accept it, but then again he might. If he does not, you can move on to more correctly priced homes.

If you try the same thing with the sane seller who has priced his home much closer to its true market value, he could be so insulted to have such a low offer that he could refuse to negotiate anymore with you. I have seen that happen. I have received orders from sellers to never bring another offer from a buyer who made a ridiculously low offer. At the very least, the seller's attitude is going to change. And this is the seller that you have the best chance of getting a fair price from. So you do not want to insult him with a real low-ball offer.

Your agent should know what is and is not a crazy price. He or she should be able to advise you as to what a reasonable opening offer should be. You can certainly offer what you want to, but at least consider the advice of the agent that represents you.

Learn to distinguish which sellers are asking for the moon and those that are asking for a fair price for their homes. Knowing which is which will greatly help you as you work your way through the current real estate market.

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 

Freddie Mac: Mortgage Rates Take A Significant Drop! May Help Those With ARMs!

Today 9/13/07,  Freddie Mac reported that the average mortgage interest rates for 30 and 15 year fixed-rate loans went down quite a bit! Nationally the average mortgage interest rate for 30 year fixed-rate mortgages was 6.31% (6.26% in the southeast), down from 6.46% a week ago. The average interest rate for 15 year fixed-rate mortgages was 5.97%, down from 6.15% last week.

"Interest rates on prime conforming loans fell across the board in the past week, with rates on 30-year fixed mortgages averaging 0.15 percentage points below the previous week's level", said Frank Nothaft, Freddie Mac vice president and chief economist. "The drop in mortgage rates may give some relief to borrowers who are looking to refinance or purchase a home.

"As a matter of fact, all the mortgage products in Freddie Mac's survey this week were lower than they were at the same time last year."

There may even be some relief for those homeowners with Adjustable Rate Mortgages if their rates are about to change in the near future. That would be good news for many.

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.

When Buying a Mobile Home With Land, Make Sure Your Title Company Can Handle It

A few months ago I had a buyer who was looking for a mobile home in Zephyrhills, Florida that came with its own lot. I found her one in a nearby subdivision that was priced at just $49,000! Very low for that area. Apparently the owners had not paid their HOA fees and the homeowners association had taken over the property. It had been bought by a flipper who was also a real estate agent in Tampa, Florida. He painted the interior and exterior, and had laid down new flooring throughout the mobile.

My buyer put in a offer that was accepted and we went into escrow. I asked the agent if he had the titles to the mobile. He said he had no paper titles since there were RP (residential property) stickers on the home. He said that meant that the home's titles had been retired at the motor vehicle department, and there were no longer paper titles.  Now, it is true that banks are frequently asking that the titles be retired and the homes be permanently "attached" to the land. But an RP sticker is no indicator of this. Homes with paper titles still have RP stickers. I spoke with the title company he was using for our deal and found out that this company had also handled the agent's purchase of the mobile. They informed me that they already told him that the DID NOT check on mobiles at all, not the titles, not liens, nada.

I had a title company I normally use do some checking, and it turned out that the agent did indeed have the deed to the land. HOWEVER, the titles to the mobile home were in the possession of a holding company. That meant that for practical purposes, the home had been separated from the land.  The agent owned the lot and the holding company owned the mobile home. When I told the owner-agent this, he did some checking and found out he would have to pay an additional $6,000 to get the titles back. A costly error that reduced his profit considerably. I recommended to him that in the future if he bought other mobile homes he might want to consider using a title company that was familiar with that type of property and sale. I do not think he was going to take my advice.

If you are a real estate agent, a buyer or seller I recommend that you consider that same advice. If the title company that is used is not familiar with the procedures for transferring the deed AND the titles of mobile homes, as well as having the ability to make sure you get clear title to everything that you are purchasing, you may wish to change title companies. These are big investments. You should do all you can to make sure that there are no problems after the sale concerning the title on the land AND the mobile that sits on it. Would not be a pleasant surprise to wake up some morning to see a truck out front ready to tow your home away!

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: www.jelwell.century21bnr.com

Pasco County School Board in Florida Considering Large Increase For Impact Fees

At our weekly office meeting it was reported that the Pasco County School Board is asking to raise the impact fees for a new single-family home to$10,477. This is more than double the present fee. Impact fees are used to offset the impact of new homes in the area. There are impact fees for libraries, parks, transportation, fire & rescue services, and hurricane preparedness. The theory is that when new people move into the area the demand on these services immediately increases. The fees are controlled by the Pasco County Board of Commissioners. Different fee schedules exist for mobile homes and commercial properties.

In recent years the school district has used the money to construct new schools which have been needed due to the influx of families here in Pasco County. The school district will make a formal request to the County Board of Commissioners in September.

It will be interesting to see if the other parties that receive impact fee money will also request increases in an attempt to offset the state's recent reforms of the property tax laws. Legislation that was passed will force local governments to freeze taxes for 2008 at the 2007 levels. From that point on they must decrease the taxes from 3% to 9%, depending on how rapidly the property owners' taxes had risen in the past. Future increases will be limited by an index based on the inflation rate. It is believed that this move alone will trim taxes throughout the state to the tune of about $15 billion. Another option that some municipalities will try is to raise service fees for streetlights, emergency services, etc.

Impact fees can affect the prices that builders will need to charge for new construction. Private owners who are building on their own lots will also be hit with these increases if they pass.

For more information you can visit the Pasco County Government website at: http://www.pascocountyfl.net/

You can also call me at: 813-783-4444 or e-mail me at: jelwell1@tampabay.rr.com 

You are also invited to visit my webpage at: http://jelwell.century21bnr.com

Freddie Mac: Lower Job Creation & Higher Unemployment Drop Mortgage Rates

Today 8/9/07,  Freddie Mac reported that the average mortgage interest rates for 30 and 15 year loans were considerably lower. Nationally the average mortgage interest rate for 30 year fixed-rate mortgages was 6.59% (6.55% in the southeast), a drop from 6.68% a week ago. The average interest rate for 15 year fixed-rate mortgages was 6.25%, down from 6.32% last week.

New job creation did not meet expectations with only 92,000 jobs being added in the month of July. This was the smallest jobs gain since the February 2007. In addition, the unemployment rate increased to 4.6%. The first increase since March 2007. These two factors worked together to drop the average mortgage rates around the United States.

Though rates did fall for prime conforming fixed-rate mortgages, it is being reported that the rates actually rose for "jumbo fixed-rate loans" by 0.25% or more last week.

Freddie Mac is reporting that due to tightened lending standards and slowing home value appreciation, fewer homeowners are going the refinancing route.

Late today (8/9/07) it was reported that the Dow Jones Industrials dropped 387 points. This was a result of news that a French bank and others were no longer going to invest in subprime mortgages here in the US. As you may have heard, these subprime loans are a major cause of the housing market's problems since most of the homeowner defaults are in this sector of the lending market. It will be interesting to see how this cut-off of funds will affect mortgage rates in the weeks to come.

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.

Now You See It, Now You Don't - Are You An Honest Seller? Or Are You Unknowingly Playing a Shell Game?

Have you ever seen someone play the shell game? There are three walnut shells and one pea. The shells are moved around rapidly and you have to guess which shell has the pea under it. No matter how hard you try, the pea is never where you thought it would be. Players always end up losing.

Selling a home can sometimes be confusing to both sellers and buyers. But if sellers unintentionally start to run a shell game serious problems can occur.

When you sell your property, you are actually selling three things. The first is the land the home is on.

The second is the home itself along with its FIXTURES. In general, fixtures are those items that are attached physically to the home. Examples of fixtures are ceiling fans, lighting fixtures, kitchen cabinets, bathtubs, sinks, garage door openers, doorknobs, wall-to-wall carpeting, etc. If it is nailed, screwed or glued to the home, it is probably a fixture.

The third items that may, or may not, be included in the sale are the personal items. These are formally called CHATTEL in the real estate industry. Chattel can include the refrigerator, range, dishwasher, tables, chairs, freestanding lamps, rugs, etc. Almost anything that is not nailed down in the home. All, some, or none of these items may convey during the sale of the property. If they are being sold they are usually either listed on the contract or an attached inventory.

Problems occur when a seller decides to take a fixture without notifying the buyer beforehand. Say your grandmother gave you an antique Tiffany light that you had installed in the dining room ceiling. You want to take it to your new home. But no one knows of this plan.  The potential buyers come through the home and think it is beautiful, especially the light. They write up a contract that you accept. When closing day arrives they do their walk-through inspection, and low-and-behold, in the dining room a light fixture from Home Depot is now hanging. That is when the fireworks begin. The buyers expected one thing and got something different.

Most purchase contracts have a spot where you can list those fixtures that do not convey with the home. If the light is not on that list, the buyer is expects that he will get it when he closes on the sale. If you really wanted to keep the light, it should have been excluded from the sale on the purchase agreement. Then the buyer is aware that he will not get it. Even better, have your agent mention in the MLS listing that the lamp will not be left with the house. Then everything is out in the open and clear.

Some sellers like leaving things in the home during showings because the home looks so great with these special items, even though they plan on excluding them from the sale. But that is kind of  like the old "I Love Lucy" episode where she buys a vaccuum cleaner from a salesman. He sells her "the works" for $10. Then he asks her if she would like the nice shiny metal container to keep the motor in. Of course that cost another $10. She thought the works meant everything she saw, but in reality it meant the motor and nothing more. If you have beautiful antique brass door hardware in your home, don't let its beauty sell your home and then switch it out for stainless steel hardware before the closing. In the case of the Tiffany lamp, it would have been much better to switch it before potential buyers came to tour the home. Then they would never think to ask for it. End of problem. Of course, there is nothing illegal about leaving those items there and taking them with you, as long as you disclose it before the buyer makes his offer. I just feel it is more open to have the buyer see the home as it will be when he takes possession of it.

Chattel can also be a problem. If you agree to sell your refrigerator with the home, that should be noted on the listing in MLS and on the purchase agreement. But then do not play the shell game on the buyer. The refrigerator that he saw when he made his offer should be the one he gets when he moves in. If the buyer does his walk-through and finds a 10 year old avocado colored refrigerator has been moved in to take the place of the stainless steel model he saw when he made his offer, trouble will ensue and you probably will not be closing until this problem (and the shouting) are taken care of. In your MLS listing tell buyers that you will be taking the refrigerator currently in the home. Period. That way the buyer can base his price on the home without the fridge.

Clearly, most sellers are honest and do not intentionally "hide the pea". Problems usually arise due to sincere misunderstandings. My advice is to be VERY clear about what is and what is not included in the sale. Neither the seller or the buyer should change the rules in the middle of the "game". That way everyone involved in the sale will come away feeling satisfied. (PS Oh, and do not take all of the lightbulbs out of all the lighting fixtures when you leave. That is just tacky. But it has really happened in the past!!)

For more information or questions about this topic please call me at: 813-783-4444 or e-mail me at: jelwell1@tampabay.rr.com 

Are You a Home Buyer or Seller Who Keeps His Word?

On one of the websites where I answer questions asked by buyers and sellers I sometimes feel like I should take up a lantern like Diogenes of ancient Greece and go looking for an honest man or woman. Over and over again I see questions from buyers and sellers who are looking for a way out of a contractual obligation, just because they have changed their minds. I certainly understand that sometimes they may not be able to perform their part of the contract due to unavoidable problems, loss of a job, a death or illness, etc. However, time and again it is because they have just changed their minds and decided not keep their part of the bargain.

In my own career, I have seen sellers in Zephyrhills, Florida who decided two days before closing that they would not sell their home. The poor buyers had invested in financing fees, a survey, an appraisal, two inspections, and a lot of time. They had also sold their home and had their belongs on a truck on the way to Zephyrhills. It boggles my mind how a seller can do this with no feelings of guilt. Sadly, they get away with it since many brokers are reluctant to sue for the commission that is rightly due them.

In the Q & A section of the other site I see a lot of buyers who want to know how many days they have to cancel the contract they just signed. I feel like asking them, "If you were that unsure, why did you sign the agreement in the first place?" They have greatly inconvenienced the sellers and the agents involved in the transaction. The home has been kept off the market and other potential buyers have been turned away. The listing agent has cancelled ads that now will take a month before they can be republished. But that does not seem to matter to these buyers. It appears that today some people take their word and the word of others very lightly. A sad commentary on our society I think.

Most of my inspectors and handymen know that if the buyer does not pay them, I will take care of them. That is a trust I have developed with them. As a REALTOR I must  be sure that my word is indeed my bond. If I say I will do something I need to follow through. I once had a poor buyer and I told her I would pay for the termite inspection if it turned out she could not buy the home. Usually these inspections cost no more than $50 in our area. When I got the bill my eyes popped out since she had chosen a company that charged $150! No matter though. I had told her I would take care of it and I did. My reputation and my word are two of the most important assets I have. I think the same goes for all of my colleagues here at CENTURY 21 Bill Nye Realty.

Happily, the vast majority of buyers and sellers still do fulfill their contractual obligations willingly. I have been very lucky in my career and have had few problems. But do take contracts seriously when you sign them. You are giving your written word that you will perform the terms of the agreement. Giving and keeping your word, whether written or verbal, should be a mark of honor that you do not want to tarnish.

The Mortgage Prepayment Predicament

I was just at a home to do a market analysis for the owners. I toured the home and made recommendations as to how they could stage the home and make cosmetic changes so that we could get the best price possible for them.

The home had been listed with another agent that I know. That agent is very good, yet the home had been shown very little during the last listing period. In all likelihood, it is the price that is the issue. In my initial estimation, the best price would be around $199,000. At that price the home would probably be shown quite a bit and would likely sell near that price. However, the owners will have to get that much just to pay off their mortgage. The closing costs will push it to about $215,000! A price that is REALLY pushing the upper levels for the current buyers market we find ourselves in.

The sellers would be able to lower their price to a more attractive level except for one fly in the ointment. A PREPAYMENT PENALTY!  From what they tell me, this penalty adds $6,000 to $7,000 to their loan payoff. If they did not have this penalty, their asking price could be much lower and would likely attract more potential buyers.

Good lenders and mortgage brokers will make sure that their clients know about prepayment penalties and do their best to help them find a loan that does not have them, if possible. Penalties can be a problem in that if you pay off the loan before a specified period of time, you will be forced to pay several thousands of dollars, depending on the terms of your loan. A typical prepayment penalty will be something like 6 months worth of interest on the remaining principal of the loan. Since the penalties apply during the first few years of a loan, the principal has hardly been lowered at all, so 6 months of interest can be considerable. In a buyers market this money can determine whether you get money, break even, or lose money when you sell your home.

Why do prepayment penalties exist? If lenders have you paying a high rate of interest, they want to make sure that you do not refinance quickly to a lower rate if interest rates should drop. They want a guarantee that for a certain number of years they will get the higher rate of interest. If you stay in the home beyond the penalty period, no problem. The problem occurs when you want or are forced to sell you home sooner. Maybe you get transferred, for example. You want to sell, but right from the get-go you are thousands in the hole. If you bought your home in 2005, like my sellers today, then you have a double whammy. The market prices are stagnant or losing ground and you have the prepayment penalty. If you want to break even, you have to hope that the sale of the home will cover what you paid, your closing costs, the mortgage payoff, AND now the prepayment penalty.

So, if you are financing or refinancing your home, ask the lender or mortgage broker about whether or not there are prepayment penalties. If he cannot find you a loan without them, call some other lenders and see if you can find a more attractive loan package. If, due to your circumstances, you cannot find a no prepayment penalty loan, shop for the one that has the shortest period during which it will exist. As I said earlier, the ones I have seen were 3 year prepayment penalty periods. My sellers today said theirs was for FIVE years. That is a very long time to be "locked" into a loan.

So be aware of these penalties, shop around for financng, and ask a lot of questions. Do not wait to hear about your loan terms at the closing table when you are against the wall. This is an important investment for you. You deserve and need to understand exactly what you are getting.

If you would like to speak with a local lender in the Tampa area you can find some at my website: www.jelwell.century21bnr.com

You can also contact me via telephone from 9 AM to Midnight at: 813-783-4444 or e-mail at: jelwell1@tampabay.rr.com  It will be my pleasure to assist you in any way that I can!

 

Looking for Open Houses in Zephyrhills or around the USA??

Just wanted to let you know that CENTURY 21, ERA Realty, Coldwell Banker, and Sothebys are now using OPEN HOUSE.COM to list their open houses. You can do a search for events in a specific area and you can also set up a notification service so that a month down the road when an open house will take place in your area, you will receive an e-mail message giving you all the details.

This may be a lot easier for you than hunting through the newspaper or on the internet. In any case, I thought it was worth passing along to you. To try out OPEN HOUSE.COM  Click Here 

If you have any question about open houses or real estate in general, do not hesitate to contact me at any time. Phone: 813-783-4444 E-Mail: jelwell1@tampabay.rr.com Webpage: http://www.century21bnr.com

John Elwell

After 3 Weeks of Declines, Freddie Mac Says Mortgage Interest Rates Have Risen

Earlier today  Freddie Mac reported that after three weeks of having interest rates decline, they have gone back up again. Nationally the average mortgage interest rate for 30 year fixed-rate mortgages was 6.73% (6.65% in the southeast), up from 6.63% a week ago. The average interest rate for 15 year fixed-rate mortgages was 6.39%, up from 6.30% last week.

Healthy consumer credit growth in May and positive employment figures forced interest rates higher during the past week. This one jump all but erased the declines that had taken place over the past 3 weeks.

Freddie Mac is predicting that 30 year fixed-rate mortgage interest rates will remain relatively stable through the rest of 2007. They also feel that the weakness in the housing market will continue during the same period. The number of homeowners refinancing their home loans is also decreasing

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.

How to Find a Local REALTOR®

What is the best way to find a REALTOR® in the area where you are selling or buying a home? These days many people, up to 75%, begin their searches by looking on the internet. However, when you enter something like "Realtor Zephyrhills Florida" into a search engine like Yahoo or Google, what most often comes up first is a series of services that appear to be local specialists since they pepper their search results with the word "Zephyrhills". In reality, they are referral services that could be located anywhere in the country! I suppose they could even be in a foreign country. Their computers add in the word "Zephyrhills" from your search inquiry so that it appears that you have reached a local site. If you had put in "Holliston" then the results would have that city's name appear several times. If you proceed to give them your contact information they contact an agent that they have recruited over the phone and probably have never met. They then charge a percentage of the commission or a flat fee for each lead referral they send to an agent. I get at least one call a week, sometimes more, from these services promising to send me referral leads if I sign up with them. But, I have never had any of them qualify me based on my expertise, training, experience, or area of service. My willingness to pay them seems to be the main qualification. If you use one of these services investigate it carefully to be sure that you will be getting an agent that works in your target area and can perform the services you need.

If you scroll down a little farther the screen or go to the next page, the actual websites of agents in your target area should begin to appear. You can usually identify these because the name of a specific real estate agent will probably be included in the information. When you speak with them always ask them where they work and what area they cover. If it is in or close to your city of interest, great. If it is farther away, be sure that you are convinced that they can help you efficiently and expertly.

One good way to find an agent is to visit the National Association of REALTORS® (NAR) site at: www.realtor.com You can enter the name of the city where you currently live or where you wish to move, and the names of NAR members in that general area will appear. One caveat here though! If you put in Zephyrhills, for example, 500 names will appear. In our town there are no where near 500 agents. Some of the names are those of agents located up to 50 miles away. Ask any prospective agents how far away from your target city they live and work. It just makes sense that a local agent will be better informed about the local real estate market. Legally I can sell homes in the Miami area and tell the NAR system that I would service a zip code area there. However, I know little about that particular market and could not perform as well in that city. Not to mention that I could not service the listing well due to its distance. My best advice is to deal with a local REALTOR®. An additional benefit of searching through the NAR site is that you will not just find a real estate agent, but a REALTOR® who subscribes to the NAR's Code of Ethics. This ensures that you will get the highest standard of service possible. You can see the Code of Ethics at the NAR site.

In Florida you can search through the Florida Association of REALTORs® (FAR) site at: http://fl.living.net/  Again, be aware that some agents will list cities they service that are faraway from your target area. So if you truly want a local agent, ask the agent how far they are from the city you are interested in and how much business they do there. They may offer to do a referral for you, but you can also find the agents in that city yourself.

If you are looking for a REALTOR® in a city other than the one you live in, you may wish to contact a local agent you know and respect near where you live, and ask him/her to find an agent for you. As a real estate professional, your local agent can help evaluate the abilities of other REALTOR®s and refer you to the best qualified candidates. In this electronic age we often have contacts in other markets and can put our customers in touch with them. This can greatly streamline the search process for you and will  hopefully increase your chances of finding a great agent to work with. Usually the agent in the other town will pay your local agent a referral fee if you buy or sell a property. So he/she will be compensated for helping you find a good REALTOR®.

Of course, another way of finding a good REALTOR® is to call me! I am a full-service real estate professional,and always work very hard for my customers. I invite you to visit my website at:  jelwell.century21bnr.com  to see what CENTURY 21 Bill Nye Realty, Inc. and I can do for you. You can also contact me via telephone from 9 AM to Midnight at: 813-783-4444 or e-mail at: jelwell1@tampabay.rr.com  It will be my pleasure to assist you in any way that I can!

For a 3rd Week Freddie Mac Reports Mortgage Interest Rate Drop

Today  Freddie Mac reported that for a third week in a row the mortgage interest rates have inched down. Nationally the average mortgage interest rate for 30 year fixed-rate mortgages was 6.63% (6.56% in the southeast), down from 6.67% a week ago. The average interest rate for 15 year fixed-rate mortgages was 6.30%, down from 6.34% last week.

Moderating core inflation rates were given as a cause of the lower rates. In fact the Federal Reserve mentioned this moderation of the core rates as the basis for leaving the target federal funds rate unchanged. As many of you know, inflation is a main worry of the Federal Reserve and often helps them determine whether they will raise or lower their interest rates. That is how they help prevent runaway inflation from taking place like it once did in the early 1970's.

Their concerns were lessened due to reports that May's personal consumption expenditures were within a range that does not set off alarm bells at the Fed. They are taking a wait-and-see attitude about whether the moderate rates of inflation will continue or not. If they begin to get uncomfortable about the trends they see, we could see the mortgage interest rates begin to climb once again. In my opinion, interest rates are still historically low and show encourage home buyers to make a move. Especially since they will be saving money due to the price reductions that we are seeing from developers and sellers of resale homes.

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.

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.