Homeowner Flood Insurance Affordability Act

The United States Senate has just passed "The Homeowner Flood Insurance Affordability Act" by a vote of 72-22 (both US Senator Nelson and Senator Rubio voted in favor of the bill. This is the bill the US House passed on March 4. This is incredible news for Florida REALTORS® and property owners. The bill will now be sent directly to President Obama for his signature!

* Reinstates Grandfathering - This bill permanently repeals Section 207 of the Biggert-Waters Act, meaning that grandfathering is reinstated. All post-FIRM properties built to code at the time of construction will have protection from rate spikes due to new mapping - for example, if you built to +2 Base Flood Elevation, you stay at +2, regardless of new maps. Also importantly, the grandfathering stays with the property, not the policy.

* Caps Annual Rate Increases at 18% - This bill decreases FEMA's authority to raise premiums. The bill prevents FEMA from increasing premiums within a single property class beyond a 15 percent average a year, with an individual cap of eighteen percent a year. Pre Biggert-Waters, the class average cap was 10%. Currently (Post Biggert-Waters), the class average cap is 20%. The bill also requires a 5% minimum annual increase on pre-FIRM primary residence policies that are not at full risk. The updated legislation also states that FEMA shall strive to minimize the number of policies with premium increases that exceed one percent of the total coverage of the policy (e.g., 1% of $250,000 = $2,500).

* Refunds policyholders who purchased pre-FIRM homes after Biggert-Waters (7/6/12) and were subsequently charged higher rates

* Permanently Removes the Sales Trigger - This bill removes the policy sales trigger, which allows a purchaser to take advantage of a phase in. The new purchaser is treated the same as the current property owner.

* Allows for Annual Surcharges - This legislation applies an annual surcharge of $25 for primary residences and $250 for second homes and businesses, until subsidized policies reach full risk rates. All revenue from these assessments would be placed in the NFIP reserve fund, which was established to ensure funds are available for meeting the expected future obligations of the NFIP.

* Funds the Affordability Study and Mandates Completion - This legislation funds the affordability study required by Biggert-Waters and mandates its completion in two years.

* Includes the Home Improvement Threshold - This bill returns the "substantial improvement threshold" (i.e. renovations and remodeling) to the historic 50% of a structure's fair market value level. Under Biggert-Waters, premium increases are triggered when the renovation investments meet 30% of the home's value.

* Additional provisions: This legislation includes several other provisions including preserving the basement exception, allowing for payments to be made in monthly installments, and reimbursing policy holders for successful map appeals.

House Flipping Opportunities are Back!

After the market declined, many investors found it very difficult to find flipping opportunities. Since home values had reduced by over 50% in many markets, investors were forced to rent their properties until the right time to sell returned.

ATTENTION Investors, release the property managers and hire me as your Realtor. Resale property inventory is extremely low and eager homes buyers are jumping at the chance to snatch turn-key homes within the first few days of being listed. Not only can you sell your rental inventory, there is still an opportunity to purchase distressed, fixer uppers at low price points, and remodel to sell at higher price points. Yes, that scenario I just explained is called Flipping.

Flipping is back. Only for a limited time, so take advantage while it lasts.

March 10, 2013, Daylight Savings Spring Forward

Daylight saving begins, March 10, 2013. This is just a friendly reminder to turn your clock one hour forward at mid-night, March 10th. Enjoy the extra daylight to get all of your work done. Personally, I look forward to daylight savings because it allows me to show homes later in the evening. Quick note from your Tampa Realtor, Gloria Walters,www.gloriawalters.com.

Special Report: Real Estate Provisions in 'Fiscal Cliff' Bill

Published by:  Daily Briefing: Wednesday, January 2, 2013
A service for members of Florida Realtors

WASHINGTON - Jan. 2, 2013 – Tuesday, January 1, 2013, the House and Senate passed H.R. 8, legislation to avert the so-called "fiscal cliff." Following are real estate-related provisions of the bill, which President Obama plans to sign into law today:

• Mortgage Forgiveness Debt Relief Act extended to January 1, 2014. In place since 2007, the act provided a tax break for homeowners who struggled through financial hardship such as a foreclosure, and were granted mortgage debt forgiveness. In the past several months, National Association of Realtors (NAR) issued numerous calls to action urging its million-plus Realtor members to ask lawmakers to extend the tax break for another year. More than a quarter of all transactions involve distressed properties, the NAR said in its plea. "Homeowners shouldn't be forced to pay a tax on money they've already lost with cash they never received."

• Deduction for mortgage insurance premiums for filers making below $110,000 is extended through 2013 and made retroactive to cover 2012.

• The 15-year straight-line cost recovery for qualified leasehold improvements on commercial properties is extended through 2013 and made retroactive to cover 2012.

• The 10 percent tax credit (up to $500) for homeowners for energy efficiency improvements to existing homes is extended through 2013 and made retroactive to cover 2012.

• "Pease limitations" that reduce the value of itemized deductions are permanently repealed for most taxpayers but will be reinstituted for high-income filers. "Pease" limitations will only apply to individuals earning more than $250,000 and joint filers earning more than $300,000. The thresholds are indexed for inflation so will rise over time. Under the formula, filers gradually lose the value of their total itemized deductions up to a total of a 20% reduction.
First enacted in 1990 and named for Ohio Congressman Don Pease, who proposed the idea, the limitations continued throughout the Clinton years. The limitations were gradually phased out starting in 2003 and eliminated in 2010. Reinstitution of these limits has far less impact on the mortgage interest deduction than a hard dollar deduction cap, percentage deduction cap or reduction of the amount of mortgage interest deduction that can be claimed.

• The capital gains rate remains at 15 percent for individuals earning less than $400,000 per year and couples earning less than $450,000.  Any gains above these amounts will be taxed at 20 percent. The $250,000/$500,000 exclusion for the sale of principle residence remains.

FHA Extends Flipping Waiver Through 2014

Typically, purchasing a Federal Housing Authority (FHA) property involves  a clause that prohibits the buyer to resell the property within the first 90 days of purchase. This preventative measure common among FHA insured mortgaged properties, but is sometimes included on cash contracts as well.

The FHA has waived that rule on some contracts and allowed flipping since January 2010. They hope this allowance will encourage investors to purchase and renovate blighted homes and offer turn-key home options for first time home buyers and others. Ultimately, this strategy will boost sales . Apparently, this strategy seems to be working. Since the FHA first extended the rule, it has been extended three additional times.

Bank of America Does It Again!

With short sales in abundance, it is very difficult to evade them. More and more of my real estate sales are short sales, with bank owned or reo properties taking a close second. There are a number of parties involved in a short sale: the lender, the negotiator, the investor, among others and each person’s role is vital to the success of the short sale.

Considering all of the short sale lenders I have worked with, Bank of America is by far, the best. From my experience, they always close within three months, unlike some of the other lenders. However, I had a recent case that threw me for a loop. In January, my client signed a contract for a two bedroom, two bath villa (short sale by Bank of America). I was confident that this would close within three months. However, three months and two negotiators later, I was drafting an extension, hoping that it will close soon. I was asked to resend a newly signed contract twice and five months into the waiting period, the contract was denied.

Stunned and confused I sent a direct twitter message to @BofA_Help, searching for an explanation. Why is this contract being denied? This doesn’t make any sense? The BofA representative responded the same day asking for further information. She researched the matter and advised me to resubmit all documents all over again and everything should be taken care of. Disheartened and a bit skeptical, I followed the instructions. This was in May. Three months later, we received an approval. My client was elated and so was I. After waiting eight months, my client now has a home.

Real estate agents have very little control on the outcome of a short sale. We always hope for the best, so all parties involved are content, especially our clients. I was happy that my client didn’t have to start the home search process all over again. Her heart was set on this property and mentally, she had already moved in. I am truly happy for the efforts that BofA made to make this sale a reality. There was a mishap in the beginning, however, we finished strong. Thank you Bank of America, you have done it again!

Cheaper to Buy Than Rent

 

 

Zillow recently released an article stating that “the average national homebuyer will save money over renting if he or she stays in a home for only three years. And in at least four Florida cities, a homeowner only needs to stay two years to make ownership the preferred option.”

Zillow examined the “breakeven horizon” for over 200 cities throughout the United States. Typical costs associated with buying or renting were considered in this analysis. These factors included down mortgage and monthly rental, closing costs, property taxes, utilities, maintenance, tax deductions, as annual inflation and changes in home values and rental prices.

I meet many renters that are on the fence, thinking of hanging up the renting towel or trading it in for home ownership. Home ownership is the largest purchase you may make in your life and it’s also the most rewarding one. I hope this bit of information will help you off the fence and into the field of home ownership.

Short Sales, Shorter Process

 

 

The short-sale process is expected to get shorter starting June 15. New guidelines issued under the Federal Housing Finance Agency will require Fannie Mae and Freddie Mac to give homebuyers of short sales notice of their final decision within 60 days. The new guidelines also will require the mortgage giants to respond to initial short-sale requests within 30 days of receiving an offer.

The speedier process is expected to be a boost to the housing market, Michael McHugh, president of the Empire State Mortgage Bankers Association, told the New York Times. Homebuyers and sellers often have to wait months before they receive a short sale decision from a lender. Some deals fall apart just from the wait alone.

Short sales have been increasing in recent months as many lenders find them more appealing than foreclosures, which can cost more and take longer to remove from their books.

Short sales now outpace foreclosure sales in many parts of the country. Short sales represent more than 14 percent of existing-home sales, according to CoreLogic housing data from March, the most recent month available.

McHugh says that a faster short-sale process may be particularly helpful in speeding the recovery in judicial states, where foreclosures must go through the courts before they are approved. Now short sales may be viewed by defaulting homeowners as more of an option if they want to avoid foreclosure.

“There should be a significant improvement in the turnaround,” McHugh said regarding housing markets with judicial foreclosure processes.

Source: “Speeding Up Short Sales,” The New York Times (May 24, 2012)

Another Happy Investor

I recently helped one of my Investor’s successfully sell a property. He used my services to acquire the property back in 2009 for about $35,000. At this time, the home needed extensive rehabilitation. As you can see by the pictures, the home had been abandoned for some time. My investor (the visionary), saw an opportunity to turn this eye-sore into a move-in ready home. Fast forward to 2011. The home had been rehabilitated and rented for over a year, waiting for the right time to sell. I listed the newly renovated home that boasted new floors (hardwood, tiles and carpet), new cabinets, new appliance package, new roof, complete with all the homey touches for $144,900. In less than 60 days, I received a full offer on the property. This is only one example of the many successful investments stories. If you are looking for a real estate professional that could help you with your investment projects, you can count on me. I will help you from property acquisition and tenant placement to property re-sale. Looking forward to working with you.

Top 10 Reasons to Own Rather than Rent

I read this article by FloridaRealtors that emphasized the top 10 reasons why it’s better to own rather than rent. With home prices really low and interest rates even lower, the market is perfect for those who have considering owning. Still on the fence? Review the list below. Hopefully it will tip you over into the field of home buyers.

 

Top 10 Reasons to Own Rather than Rent
1. You own it: With no landlord, you make the decisions.
2. You deduct it: Mortgage interest, property taxes and some costs involved with buying a home can be deducted from federal income taxes.
3. Interest rates: The cost to borrow mortgage money is at an all-time low. If you’re going to buy, this is the time to jump into the market.
4. You invest in it: Rent money is gone forever. Mortgage payments build home equity ownership interests.
5. You save for the future: Home equity is a ready-made savings plan. Sell it and you can make up to $250,000 cash without owing any federal income tax on the profit.
6. You can predict expenses: Unlike rent, a fixed-mortgage payment doesn’t get more expensive over time.
7. You pick it: Choose from different neighborhoods, styles and price ranges.
8. You create it: Decorate, renovate, get a pet or paint the walls whatever color you want – it belongs to you.
9. You live in a neighborhood: You and your neighbors take pride in the local schools, roads and more – and you work together to build a friendly community.
10. You spend money on yourself: When you buy a chandelier or hardwood floor or kitchen cabinet, you’re spending hard-earned money on yourself and building your equity at the same time.

 

Call me if you are ready to buy a home in Tampa… I look forward to working with you.

Could Google soon power homes?

The Internet giant is increasing its stake in the solar home power business with a $75 million “initial investment” to buy and own solar-panel generators on roofs of thousands of homes. Google is investing in Clean Power Finance, a start-up company that matches solar-panel installers with investors willing to buy rooftop solar-panel systems. “With Google’s investment, solar-panel installers can find homeowners who want solar panels on their roofs but don’t want to have to pay several thousand dollars to own the system,” according to an article in The Wall Street Journal.

“We’re excited about the opportunity to really help accelerate residential solar,” says Rick Needham, Google’s director of green business operations. The latest investment will likely help fund up to 3,000 home rooftop solar systems. In June, Google made a $280 million investment in residential rooftop solar-panel installations with SolarCity Corp. Google’s total investment in renewable energy has been more than $850 million. Rooftop solar demand is growing, and homeowners are finding paybacks too. Earlier this year, a study by Lawrence Berkeley National Laboratory found that solar panels not only saved homeowners money on electricity bills but also helped boost a home’s resale value, particularly for existing homes.

Source: “Google Invests $75 Million in Home Solar Venture,” The Wall Street Journal (Sept. 27, 2011)

Tampa Bay Real Estate Investment Opportunities (October 2, 2011)

Investment opportunities are eminent in the Tampa Bay Real Estate market. As a Realtor specializing in selling investment properties, I’ve been keeping a close eye on the market’s activities. In the month of July, an investor contacted me to view and place a bid on a home in Villa Sonoma. At the time, this highly desirable community showed five condo units available for sale, ranging from one to three bedrooms. By early September, all five condos were under contract. There are currently no units available for sale in this community.

I noticed a similar trend at Parkcrest Harbor Island (one of my personal favorite condo communities in Tampa.) This highly desirable complex located on the water, boasts a great location, tons of amenities and impressive upgrades. There were nine units available in July. As of today, October 2nd, there are only two available for sale. Contact me to schedule a viewing today if you are interested in securing a home in this community.

Just recently I shared the investment opportunities with one of my real estate partners in California. He was shocked that homes were available for sale and priced under 20K. I thought this information would be great to share with other possible investors out there. This is a buyer’s market and many are taking advantage. If you ever considered purchasing a home to renovate and lease for some years, or for any other reasons you may have in mind, this is the time.

There are currently 35 homes available for sale and priced at 20K or less. Click here to view these homes. Please give me a call 772-359-7543 or email me at gwalters83@gmail.com to schedule a viewing and begin your journey in investing in Tampa’s Real Estate.

       

Short sales lose appeal among first-time buyers

A short sale occurs when a seller, sells his/her home for less than the amount owed. For example, seller A owes $100,000 for their single family home, but sells to buyer A for $50,000.  Since the home is sold for less than what the seller owed, this transaction is called a “Short Sale”. Short sale homes relieve the seller of a mortgage they could no longer afford and allow a buyer to purchase the home at a great price point. The short sale process could be cumbersome and takes a lot longer than traditional sales. The turnaround times can be anywhere from 90 days to nine months, sometimes even longer. According to the latest Campbell/Inside Mortgage Finance HousingPulse Tracking Survey, short sale purchases for first time buyers have dropped to 39.7% of total transactions for the month of August. The survey further explains that buyers are frustrated with the approval response times, the extended time to close and the unexpected delays. Some buyers consider placing multiple offers on different homes and choses the home that wins the race to the closing table. When looking to purchase a short sale, hire a Realtor who can help you uncover all that you can about the home. 

Calling All Investors to the Rental Market

I recently read an article from Money Magazine entitled, “Cashing in on Rental Property”. This article solidified my belief in the rental potential of the current real estate market. Low priced homes become available on the market, week after week, many with tenants already in tact.

According to a recent study, nearly 35% of occupied U.S. homes were rentals in 2010, which is a 33.8% increase from 2000. The demand for rentals is apparent. Homeowners who have lost the loan modification battle have circumstantially become renters.  Over 500 cities nationwide are experiencing an increase in home rental demand.

From an investment perspective, this rise in rental demand yields an opportunity for increased rental income. According to the real estate research firm Hotpads.com, the price of rent increased 11.6% nationally in 2010 to $1,320 a month on average. The ‘flipping’ opportunities that were prevalent back in 2005 may be slim in today’s market; however, if investors are looking to own rental properties and build their real estate portfolio, this is the time to capitalize. According to a survey by the National Association of Realtors® (NAR), investors say they plan to hold onto their rental property for 10 years before selling.

Investing in today’s real estate market is an excellent long-term strategy. If you are looking to build your real estate portfolio, give me a call. I’ve been working with investors since 2006. My niche is helping Tampa’s savvy investors own in today’s market. Whether you are looking for a fixer-upper, or a great deal in a desirable community, I can help you accomplish your goal.