Sarasota Real Estate Market News

Wait, the bank is offering me what?

SARASOTA COUNTY – The bank spent the last two years denying Deborah Johnson’s efforts to save her Sarasota home from foreclosure, and then out of nowhere, last month, sent her an unbelievable offer. 

If Johnson could find someone to buy the property for half of what is owed on the mortgage, JP Morgan Chase bank would not only forgive the remaining $100,000 of debt, but also send her away with $35,000 in her pocket.

Read more HERE

July 30, 2011 Posted by | News related to Short Sales and Foreclosures | Leave a comment

Bank: ‘We’ll reduce your loan, you share future appreciation’

NEW YORK – July 28, 2011 – Ocwen Financial Corp., a servicer of residential mortgages, launched a new loan modification program to reduce the principal on a mortgage for delinquent borrowers, but the borrowers must agree to let loan investors share in future appreciation of the home’s value when the market recovers.

Through the Shared Appreciation Modification program (SAMs), Ocwen will write down the principal of the loan to 95 percent of the home’s current market value. The amount written down will then be forgiven in one-third increments over a three-year timespan, as long as the homeowner remains current on the modified mortgage.

Then, “when the house is later sold or refinanced, the borrower must share 25 percent of the appreciation with the investors that own the loan; borrowers keep 75 percent of the gain,” the company notes.

Loan modifications will be available only to homeowners in negative equity.

“Like all modifications, SAMs help homeowners avoid foreclosure. But they also restore equity,” says Ocwen CEO Ronald Faris in a public statement about the program. “That’s a significant benefit to the customer and, we believe, the economy and housing market. Psychologically, it’s important too. Our analytics tell us that an underwater mortgage is one-and-a-half to two-times more likely to default than one with at least some positive equity.”

The program, which is expected to be rolled out into 33 states, is one of the first principal reduction programs started by a private company.

Source: “Ocwen Unveils New Principal Reduction Program,” HousingWire (July 26, 2011) and “Ocwen Offering Mortgage Modifications That Restore Equity for Underwater Borrowers,” GlobeNewswire (July 26, 2011)

July 29, 2011 Posted by | News related to Financing, News related to Short Sales and Foreclosures | Leave a comment

Florida real estate gets high marks in Fed’s latest economic review

ATLANTA – July 28, 2011 – Florida emerged as something of a stand-out student in the Federal Reserve’s latest report on real estate in the Southeast.

Amid gloomy reports from brokers in the Fed’s Atlanta district, authors of the closely watched economic report card noted Florida was bucking the trend and reporting positive news.

This has been a running theme in the Fed’s monthly Beige Books, with sales of Florida homes outperforming the rest of the South. In tempered language for its July report, the Fed said the Atlanta district’s reports of modest growth in home sales over the prior year came thanks to the Sunshine State.

“Gains continued to be driven largely by reports from Florida brokers. Outside Florida, the majority of contacts reported sales declined,” the report stated. “The outlook among Florida brokers was somewhat positive, but elsewhere sales are expected to remain weak.”

Tourism fared the best in the Atlanta district’s write up, with Fed authors calling it “strong.” The report noted high-end retail seemed to be gaining traction, though the retail industry as a whole is less optimistic than a year ago.

In all, the Fed described the Southeast’s economy as basically flat compared to June. That’s a bit worse than the description for the national economy as a whole, which the Fed said continued to grow, but at a more modest pace.

Copyright © 2011 The Miami Herald, Douglas Hanks. Distributed by McClatchy-Tribune Information Services.

July 29, 2011 Posted by | News related to Buyers, News related to Financing, News related to Investors, News related to the Market | Leave a comment

NAR: Pending home sales rise in June

WASHINGTON – July 28, 2011 – Pending home sales increased in June following a wide swing down in April and then up in May, according to the National Association of Realtors® (NAR). Month-to-month activity increased in the West and South but declined in the Midwest and Northeast. However, all regions show strong double-digit gains from a year earlier.

The Pending Home Sales Index, a forward-looking indicator based on contract signings, rose 2.4 percent to 90.9 in June from 88.8 in May, and is 19.8 percent above the 75.9 reading in June 2010, which was the low point immediately following expiration of the homebuyer tax credit. The data reflects contracts but not closings.

Lawrence Yun, NAR chief economist, said there may be some increase in closed existing-home sales.

“For the majority of transactions, the lag time between pending contacts to actual closings is one to two months. Therefore, the two consecutive months of rising activity should lead to overall improvement in closed sales in upcoming months,” he said. “Though a higher than normal cancellation rate can hold back final closing figures, it could well be that some past cancellations are nothing more than delayed buying decisions rather than outright cancellations.”

Yun said tight credit and economic uncertainty have been constricting the market. “The best way to ensure a more solid recovery in housing is to simply return to normal, sound credit standards so more creditworthy homebuyers can get a mortgage,” he said.

“Washington also should not rock the boat with policy changes that would negatively impact affordable credit or otherwise increase the cost of buying or owning a home,” Yun added.

The PHSI in the Northeast slipped 0.4 percent to 68.9 in June but is 19.4 percent higher than June 2010. In the Midwest the index fell 3.7 percent to 79.7 in June but is 26.4 percent above a year ago. Pending home sales in the South increased 4.4 percent to an index of 99.2 and are 19.1 percent higher than June 2010. In the West the index rose 6.4 percent to 107.0 in June and is 16.4 percent above a year ago.

Existing-home sales this year are expected to total 5.0 million, slightly higher than 2010. Similarly, little change is forecast for aggregate home prices with several indicators, including NAR’s median prices, showing recent signs of stabilization.

© 2011 Florida Realtors®

July 29, 2011 Posted by | News related to the Market | Leave a comment

5 do’s and don’ts when hiring contractors

CASPER, Wy. – July 27, 2011 – Have a home remodeling project in mind? Here are some tips that may help you achieve a successful result.

1. Research pays off, but remember who the expert is.

DO research your project before you get quotes. It doesn’t hurt to find out, at least generally, the correct way your project should be completed. Look at trade magazines and visit home improvement websites to explore different approaches to remodeling. Sometimes there is more than one way to complete a project. For example, one painting contractor may prefer to paint your room with a tinted primer followed by two coats of latex paint, another may use a one-coat self-priming paint. Find out what industry standards are, what is a no-no under any circumstances or what might work best for your project. A little knowledge gives you power to negotiate the best price for the best work.

DON’T think a little knowledge makes you an expert. Above all, don’t think your project will be completed like projects you see portrayed on television. Home improvement television shows are deceiving. There are whole crews bringing the project to a finish in-between the time the camera is rolling. Mistakes are edited out. Remember that every remodeling project is different, and there can be hidden complications.

For example, replacing the slider door that’s been sticking for the last two years seems like a simple one-day project, but when your contractor takes out the existing door he might find it was not properly flashed by the original installer. Decay, dry rot or mold affecting the underlying framing may require him to do unexpected work. He may not be a shady contractor; he might be concerned that if he replaces the slider without fixing the underlying problem, in a few years you’ll be unhappy with his finished product.

Most reputable contractors will keep you informed of any unexpected developments and will discuss solutions with you, including estimated extra costs. They will show you problem areas and explain the process for fixing them in detail. In some cases, they can tell you in advance what kinds of hidden problems they’ve seen before and whether they think they’ll experience the same issues with your remodeling project.

2. Get competitive bids, but don’t take the lowest bid offered.

DO get competitive bids. For small projects, calling 2 or 3 contractors is usually sufficient. For larger, more extensive projects, it’s wise to have a minimum of 4 to 5 contractors bidding against each other. People will spend weeks researching the best cars and haggling over a car sale when it’s time to buy a new vehicle, but don’t hesitate to spend thousands of dollars on a remodeling project after mere hours or a few short meetings with contractors.

DON’T take the lowest bid offered, thinking you will be getting the best deal, even if your contractor shows up in a designer polo in a big, shiny truck with custom lettering looking like the perfect professional. Be leery of any contractor eager to bid lower than everyone else. It’s common practice for less-reputable remodelers to have “hidden costs” they spring on you later in the project, when everything is torn apart and you feel like you can’t back out without extreme inconvenience or loss of what you’ve already invested.

3. Negotiate for the best price, but don’t under-value your contractor.

DO negotiate for the best price. Pick the best contractors, and give them a chance to bid against each other for your project. Most contractors are willing to negotiate. If you can’t get them to negotiate on the labor price, ask them to offer you discounts on materials. Most contractors get commercial discounts between 5-25 percent from suppliers and may be able to offer you a portion, if not all, of this discount without suffering a loss on the value of their time. Depending on the size of your project, this can equate to significant savings. Some contractors may offer you a much lower labor price to beat out other bids but make up for it later through high mark-ups on materials.

DON’T get too obsessed with negotiating. Contractors often pay high insurance and overhead costs, especially if they have employees. They want to work for you, but if you want a high quality product, keep in mind that a reputable contractor with good references will walk away from your project if he thinks you are under-valuing his skills. No one wants to be under-valued. Asking for a bottom line price is not inappropriate, but asking him to be competitive with someone he knows to be the worst contractor in town could land you in spot where you have ONLY the bad contractor to complete your job. Be fair.

4. Insist on a contract and understand its terms.

DO insist on a comprehensive contract. Surprisingly, many people think a contract locks them into a set price, which is not really the case. Anyone can write a number down on paper! The most important aspect of any remodeling contract is the detailed scope of services to be provided. Even for small jobs, this is the key to getting services with a set price. For example, if your contractor is replacing an old window, NEVER accept a contract that says: “Window Replacement $XXX.XX!” The contract should specify whether or not the window will be removed and disposed of (not all contractors dispose of construction debris); whether the new window will be caulked and weatherized; or even whether the old window molding will be re-applied or replaced. Also, the contract should state how long it will take to reasonably complete services, as well as what kind of materials will be used. Insist on high quality fasteners, caulking and other materials to protect the integrity and long-term durability of your project.

DON’T ignore payment terms, which can vary greatly between contractors. Make sure you understand terms fully. Pay your contractor in a timely manner, especially if he’s efficient and provides quality workmanship. If you find the contractor is not meeting his end of the bargain, you have every right to withhold payment until a certain portion of the work is completed in accordance with the terms of your contract. Make sure payment terms state amounts to be paid at specified time periods. Having a clear and concise contract legally protects both parties and prevents misunderstandings about what is expected by all.

5. Check references carefully.

DO check references, and if possible, look at a portfolio of finished projects. Try to arrange a visit to a site where the contractor performed work similar to your own project.

DON’T let a contractor’s charm sway you. The best con artists can “talk a dog off a meat wagon.” If you are investing a sizeable amount of money into a remodeling project, you want to ensure that the contractor has a good track record by calling or visiting client references – not his relatives. If possible, try to talk with clients who have finished projects more than a year old. Newly remodeled areas always look great compared with the old, but work that still looks great a year or more later is proof of quality workmanship.

Ask these questions about how the contractor worked: Did the project move along smoothly? Did the contractor show up to work daily or have a project manager so the project moved along in a timely manner, or did work go unfinished for days or weeks at a time, seeming to take forever to complete? Did they work haphazardly or clean up at the end of each day to minimize disruption? Some people want a project completed simply and quickly, some want fancy detailing finished to magazine perfection. Decide what services are most important to you, write a list of them and discuss how they will be completed in a reasonable timeline with the contractor.

© 2011 Networx. Distributed by McClatchy-Tribune Information Services.   Laura Foster-Bobroff is a Hometalk – http://www.hometalk.com – writer.

July 29, 2011 Posted by | News related to Investors, Uncategorized | Leave a comment

New grant for military first-time home buyers

WASHINGTON – July 27, 2011 – A new program offers financial assistance to first-time homebuyers who are veterans or active-duty military members. The Pentagon Federal Credit Union Foundation, a nonprofit national organization, offers the program through its Dream Makers program.

Active duty personnel, veterans, retired members of the military and employees of the U.S. Department of Defense and the Department of Homeland Security may be eligible for a grant up to $5,000 to use toward downpayments and closing costs if buying their first home. The grants can be applied to a mortgage issued by any financial institution.

“Members of the military often put off buying a home early in their careers because they’re moving around the country a lot,” says Kate Kohler, chief operating officer for the PenFed Foundation. “We want to make sure they have resources to add immediate equity into their home when they decide to buy.”

Requirements:

  • Military affiliation – (active duty, reserve, National Guard or veteran) – a Department of Defense employee or a Department of Homeland Security employee.
  • First-time homebuyer or not owned a home for the last three years; or a home has been lost through divorce or disaster.
  • Gross household income, including allowances, used to qualify for a mortgage loan is a maximum of $55,000 per year, or 80% of a community’s median income based on family size.

To view eligibility requirements, visit www.pentagonfoundation.org/dreammakers.

Source: “Veterans and Active Duty Can Get Financial Help When Buying Their First Home,” Pentagon Federal Credit Union Foundation (July 25, 2011)

July 29, 2011 Posted by | News related to Buyers, News related to Financing | Leave a comment

Spring buying boosted home prices for 2nd month

WASHINGTON (AP) – July 26, 2011 – Home prices in major U.S. cities rose in May for the second straight month, propped up by a flurry of spring buyers. But after adjusting for such seasonal factors, prices fell in a majority of markets.

The Standard & Poor’s/Case-Shiller home-price index released Tuesday showed that prices rose in 16 of the 20 cities tracked.

Boston posted the biggest monthly increase, followed closely by Minneapolis and Washington. Prices in three metro areas hit the hardest by the housing crisis – Detroit, Las Vegas and Tampa, Fla. – fell to their lowest points since the recession began. Prices in Phoenix were unchanged.

The 20-city study rose 1 percent in May from April. The index measures prices compared with those in January 2000. It then provides a three-month average. The May data is the latest available.

Separately, the Commerce Department said fewer people bought new homes in June from May. Sales fell 1 percent last month to a seasonally adjusted annual rate of 312,000. That’s less than half the 700,000 that economists say is typical in healthy markets.

Housing remains the weakest part of the economy. High unemployment, larger downpayment requirements and tighter credit are preventing many buyers from entering the market. Many who can afford to buy are waiting because they are worried prices have yet to hit bottom.

Analysts say home prices have stabilized over the past six months. But uncertainty over unemployment and millions of foreclosures that have been delayed because of a government investigation could easily send prices downward in the coming months.

Robert Shiller, a Yale professor and co-founder of the home-price index, said too much of the economic picture remains up in the air to make any realistic projection about where home prices are headed.

“The aggregate economy is at a turning point and there is much uncertainty now,” he said.

David M. Blitzer, chairman of S&P’s index committee, said the month-over-month increase in May was attributed to a “seasonal period of stronger demand for houses.” Such increases are expected, he said.

“Sustained increases in home prices over several months and better annual results need to be seen before we can confirm a real estate market recovery,” he said. Over the last 12 months, prices have fallen in 19 of the 20 cities tracked.

One bright spot: Even when adjusted for seasonal factors, month-over-month prices rose in some markets that had been pummeled by slumping sales. Those cities are Chicago, Denver, Miami, Minneapolis and Seattle.

Still, prices in 11 markets fell when adjusted for the spring-buying season: Atlanta, Charlotte, Cleveland, Dallas, Detroit, Las Vegas, Los Angeles, Phoenix, Portland, San Diego and Tampa, Fla.

Last year, a tax credit for first-time buyers helped boost prices. They rose nearly 4 percent from April through July before falling more than 7 percent this winter to record lows. Prices in big metro areas sank in March to their lowest levels since 2002.

Americans are holding off from buying homes for a variety of reasons.

A growing number of contracts are being canceled before sales are final because unexpectedly low home appraisals are scuttling loans. Few people want to take on the extra debt associated with a home purchase. Even historically low home prices and cheap mortgage rates haven’t brought people back to the market.

Foreclosures and short sales – when a lender agrees to sell for less than what is owed on a mortgage – made up about 30 percent of all home sales last month, up from about 10 percent in past years. And 1.7 million potential foreclosures are being held up, according to real estate firm CoreLogic, either by backlogged courts or lenders awaiting state and federal probes into troubled foreclosure practices.

Sales of previously owned homes fell in June for a third straight month to a seasonally adjusted annual rate of 4.77 million homes. This year’s pace is lagging behind the 4.91 million homes sold last year – the fewest since 1997. In a healthy economy, people buy roughly 6 million homes per year.
AP LogoCopyright © 2011 The Associated Press, Derek Kravitz, AP real estate writer. All rights reserved.

July 29, 2011 Posted by | News related to the Market | Leave a comment

Home-sale increase reported

You are seeing more and more of this kind of headline: “MIDYEAR SALES EQUAL 2010 TOTAL”

Even though they are not building anywhere near what would be considered the necessary number of homes to keep up with population growth, a number of home builders are making headlines like that one. This week the spotlight shines on Gibraltar Homes, whose sales exploits were detailed on page 3 of our Real Estate section on Saturday.

The general real estate market is seeing such improvement, too.

Read more HERE

July 29, 2011 Posted by | News related to the Market | Leave a comment

North Port running low on homes to list

It seems like only yesterday that North Port was suffering from a glut of distressed homes that kept coming on the market at fire-sale prices.

But today the situation looks very different.

According to an analysis provided by Michael Saunders & Co. agent Robert S. Goldman, a 4.3-month supply of homes was for sale in North Port at the end of June — a ridiculously low number, considering that a six-month supply represents a healthy market and anything below that means sellers can begin pushing prices up.

And there have been some early indicators that prices are rebounding. The median price for the 50 homes that sold during the first 20 days of July was $105,500, up 12 percent from the same 20-day period last year. In turn, the median price has battled back from a Great Recession low of $76,125 at the end of November.

Read more HERE

July 29, 2011 Posted by | News related to Investors, News related to the Market | Leave a comment

Deals for multifamily complexes reveal a busy Sarasota area market

Florida’s once-reeling multifamily market appears to be on the mend, evidenced by the latest in a series of apartment complex purchases.

Earlier this month, a Sarasota company, FL Beneva Place, paid $14.9 million for the 193-unit Beneva Place complex near the intersection of Clark and Beneva roads. The seller was Sarasota Beneva Place Associates Ltd., a subsidiary of Chicago-based Equity Residential.

That followed Equity Residential’s earlier sale of the 336-unit Sawgrass Cove Apartments in Bradenton in June for $23.2 million. Other complexes sold recently include Cielo at Bradenton, a 299-unit property, and a 247-unit complex at 1001 Center Road in Venice.

A trio of Florida cities, Jacksonville, Orlando and Palm Beach, still rank among the 15 worst metro markets when it comes to apartment vacancy rates, all reporting vacancies well above the U.S. average of 5.9 percent for the second quarter of 2011, according to Marcus & Millichap managing director Hessam Nadji.

But besides being among the worst U.S. rental markets, these metro areas also “would qualify as some of the most rapid recovering markets in the last 12 months,” Nadji noted in his firm’s “Mid-Year Apartment Market Outlook.”

Read more HERE

July 29, 2011 Posted by | News related to Investors, News related to the Market | Leave a comment