Monthly Archives: March 2019

$290,900 vs. $300,000: Which is better for pricing a listing?

ORLANDO, Fla. – March 15, 2019 – Price a can of beans too low and it hurts profits. But price it too high and the drop in sales will offset any additional profit per can. As a result, proper pricing is both science and art in the retail world.

In real estate, however, it’s not always so simple. However, online searches have changed some of those dynamics. Buyers now have price options when they do a listing search, and those often end on even numbers, such as $300,000-$350,000. In these cases, a listing agent pricing a client’s home using the drop-down method might advertise at $299,000. But a homebuyer using the noted range would then never see it.

As a result, homes with a recommended listing price close to natural break numbers offered in online searches can expand the number of people who will see the listing by using an even number. If that $299,000 listing is advertised at $300,000, the people looking for homes in the $250,000-$300,000 range will also receive it in their results.

Robert McTague suggests four ways psychology can influence price in a recent Inman article:

1. The nine-at-the-end price

Beyond the online search reason to use round numbers, what should be done for a home recommended at $310,000? List it at $309,900?

A nine at the end seems to make sense psychologically when trying to attract buyers. A 99¢ can of beans is somehow cheaper than its $1 competitor, for example. In home sales, agents may think it makes a home sound more affordable.

McTague writes that smart people aren’t fooled by this, however, and “You should position your client’s home as luxury brands do, not as discounters.” In the retail world, rounding down by a few cents suggests bargain shopping. Using an even number – a tactic used by Godiva Chocolates and Ferrari – suggests a luxury, top-notch item.

2. Odd prices seem more legit

McTague called the “power of four and seven … evident.”

Translated into real estate, a buyer who sees a home listed for $354,000 or $357,000 is more likely to assume that some thought went into that listing price. “Why the extra $4,000?” they might wonder. “Why didn’t they at least round up to $355,000?”

A precise price such as those ending in four or seven, McTague says, suggests to the buyer that a full analysis went into the pricing and that the asking price is exactly what the seller thinks his home is worth. The buyer may also think there is less room for negotiation.

3. Nix the commas and decimals

A study found that the way people read numbers affects how they feel about those numbers – and the less thinking they must do, the lower they think the price is. Here are three ways to write the same number, with the final one sounding more affordable to some buyers:

  • $350,000.00
  • $350,000
  • $350000

Good pricing is not always good grammar.

4. Add the commas and decimals

This is the flipside of No. 3, McTague says. If lowering a home’s asking price, add in the commas and decimal points to make it seem like more of a change, as in “Price lowered $5,000.00 – now listed at $354000.”

Source: Inman News, Robert McTague

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4 out of 5 buyers’ agents say home staging helps

WASHINGTON – March 15, 2019 – A new survey from the National Association of Realtors® (NAR) found that 83 percent of buyers’ agents say staging makes it easier for buyers to visualize a property as their future home. The survey, NAR’s 2019 Profile of Home Staging, is available online.

“Realtors understand the importance of making a residential property as welcoming and appealing as possible to potential buyers. While every Realtor doesn’t use staging in every situation, the potential value it brings is clear to both homebuyers and sellers,” says NAR President John Smaby.

More than half of sellers’ agents said that staging a home decreases the amount of time a home spends on the market, with 25 percent saying that it greatly decreases the time and 28 percent saying it slightly decreases the time.

Television’s impact on homebuyers

The report contains a new section called “Buyer Expectations,” which focuses on how home buying television shows impact Realtors’ businesses and how they’ve changed homebuyers’ views about the home buying process.

While 38 percent of respondents say that television shows on the home buying process have had an impact on their business, 32 percent witnessed no impact and 31 percent do not know if they have an impact.

The report found that 20 percent of buyers were disappointed by how “real” homes look compared to homes they saw on television shows; 39 percent of respondents found the home buying process more difficult than they expected; and 10 percent of respondents say that buyers felt homes should look the way they do when staged on TV shows.

Only 6 percent of buyers’ agents said that staging had no impact on buyers, while 40 percent said staging has an effect and 52 percent said staging affects some buyers.

Staging’s impact on the home sale

Buyers’ agents say that the living room is the most important room to stage (47 percent). The next most important are the master bedroom (42 percent) and then the kitchen (35 percent). Sellers agents agree but in reverse order. The guest bedroom is considered least important.

Forty-four percent of buyers’ agents report that staging increased the financial offer on a home; 25 percent say it increases its dollar value by 1 to 5 percent, and 12 percent said it increases the dollar value 6 to 10 percent. But 29 percent of buyers’ agents say it has no impact on dollar value. Only 1 percent of buyers’ agents felt it has a negative impact.

Sellers’ agents report even more value added from staging: 22 percent reported an increase of 1 to 5 percent in dollar value; 17 percent reported an increase of 6 to 10 percent; 5 percent reported an increase of 11 to 15 percent; and 2 percent reported an increase of 16 to 20 percent.

No sellers’ agents reported a negative impact from home staging.

When deciding which homes to stage, 28 percent of sellers’ agents say they stage all of their clients’ homes before listing them, while 45 do not stage homes before listing them, though they do recommend that sellers declutter their homes and fix any faults within the property. Another 13 percent said stage only difficult-to-sell homes, and 7 percent stage only homes in higher price brackets.

“Realtors have the expertise and local market knowledge to know which properties and specific rooms will benefit the most from staging, which is why working with a Realtor is so vital for sellers in today’s housing market,” says Smaby.

Who pays for the home staging? The seller pays before listing the home 18 percent of the time, while sellers’ agents personally provide funds in 26 percent of cases; 17 percent of the time, agents will offer home staging services.

In addition to staging, 95 percent of agents recommend decluttering the home, 89 percent recommend an entire home cleaning and 83 percent recommend removing pets from the home during showings. Other pre-sale projects include carpet cleaning, depersonalizing the home and making minor repairs.

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Congress could add fair housing protections for LGBT

WASHINGTON – March 15, 2019 – Bills were introduced into both the U.S. House and Senate last Wednesday extending Fair Housing Act protections to LGBT individuals – a move supported by the National Association of Realtors® (NAR).

“Realtors have worked for [nearly] a decade to ensure the American dream of homeownership is not unfairly denied to those in the LGBT community,” NAR President John Smaby said in a statement.

NAR amended its Code of Ethics to prohibit discrimination based on sexual orientation in 2011 and gender identity in 2013. Last year, the association supported the Fair and Equal Housing Act, which would make those protections part of the Fair Housing Act. However, Congress adjourned before the bill could come up for a vote.

The legislation introduced Wednesday, called the Equality Act, includes the NAR-supported housing protections of the Fair and Equal Housing Act and also extends LGBT protections in the areas of employment, public accommodations, credit markets and voting.

Shannon McGahn, NAR senior vice president for government affairs, will appear at a policy summit hosted by the National Association of Gay and Lesbian Real Estate Professionals next month in Washington, D.C., to talk about next steps for the legislation.

Source: Realtor Magazine, Robert Freedman

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Top day to list a Fla. home? Depends where you live

ORLANDO, Fla. – March 14, 2019 – Realtor.com analyzed listings on its website with an eye toward the best day of the year to put a home on the market. The ideal day? April 1.

That’s close to ideal for Jacksonville – one of four Florida metro areas included in the analysis – but less so for other areas. According to Realtor.com, the best time to list a home in Jacksonville this year is March 31.

The Orlando-Kissimmee-Sanford metro area’s high-point for listing a home is less than two weeks later, April 14, 2019, but the peak time to put a house up for sale in Tampa-St. Petersburg-Clearwater doesn’t occur until early summer, June 9, 2019. And the Miami-Fort Lauderdale-West Palm Beach doesn’t follow the spring selling season pattern at all. Realtor.com says the top day to list a home in South Florida is Aug. 4, 2019.

“June is often considered the peak of home buying season, but our analysis found the first week of April is best for sellers looking to maximize list price, and also reduce the risk of price cuts and competition from other sellers,” says Danielle Hale, chief economist for realtor.com. “Given the time it takes from listing to close, putting a home on the market in early April positions sellers to attract buyers seeking to close and move before the beginning of school year.”

The analysis is based on trends in median listing prices, views per property on realtor.com, home price drops, median days on market, and number of listings on the market over the last three years.

Why the first week of April?

The market is bustling with buyers, but the number of homes hasn’t peaked yet, according to the analysis. Homes listed the first week of April see 14 percent more views, on average, and 5 percent less competition compared to the rest of the year’s weekly average. As a result, homes are likely to sell 6 days (about 9 percent) faster on average.

Although the typical June listing is 7 percent more expensive than the best week to list, waiting until June could mean a higher likelihood of a price reduction as buyers bow out toward the end of summer.

In addition to more views, homes listed at the beginning of April are approximately 1 percent less likely to take a price cut, on average, compared to the rest of the year. On the flip side, homes listed in June are 1 percent more likely to have their price reduced and see nearly 2 percent fewer listing views than other times of the year, on average.

Another factor likely to boost April buyer demand this year is the surprising decline in mortgage rates that started in November 2018. Rates are now below 4.5 percent vs. nearly 5.0 percent in November 2018. These lower rates could entice demand earlier than usual.

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ATTOM: Fla. year-to-year foreclosure starts up 68% in Feb

IRVINE, Calif. – March 14, 2019 – In ATTOM’s latest foreclosure report, Florida topped the list for the increased number of homeowners (68 percent) who received a first letter of delinquency in February, though the percentage varies by metro area.

Nationally, ATTOM reported a total of 54,783 U.S. properties with foreclosure filings in February 2019, down 3 percent from the previous month and down 11 percent year-to-year – the eighth consecutive annual decrease in foreclosure activity.

Counter to the national trend, however, 13 states posted year-over-year increases in foreclosure starts in February 2019, including Florida (up 68 percent), Oregon (up 46 percent), Louisiana (up 34 percent), Illinois (up 9 percent), Texas (up 9 percent) and Colorado (up 3 percent).

Metro areas with a population greater than 1 million that saw an annual increase in foreclosure starts included Los Angeles, California (up 7 percent); Chicago, Illinois (up 15 percent); Houston, Texas (up 73 percent); Washington, D.C. (up 11 percent); and Miami, Florida (up 74 percent).

The foreclosure rate represents all homes somewhere within the foreclosure process, including REOs (bank-owned).

Florida metro foreclosure rate changes – month-to-month – year-to-year

  • Jacksonville – Up 6.26% – Up 14.45%
  • Pensacola-Ferry Pass-Brent – Up 20.65% – No change, 0.00%
  • Tampa-St. Petersburg-Clearwater – Up 40.58% – Up 42.42%
  • Lakeland-Winter Haven – Down 32.51% – Up 25.38%
  • Ocala – Up 18.42% – Up 80.00%
  • Miami-Fort Lauderdale-West Palm Beach – Down 0.47% – Up 31.25%
  • North Port-Sarasota-Bradenton – Up 50.25% – Up 92.90%
  • Orlando-Kissimmee-Sanford – Up 7.27% – Up 42.05%
  • Cape Coral-Fort Myers – Up 27.00% – Up 41.11%
  • Palm Bay-Melbourne-Titusville – Up 7.64% – Up 35.20%
  • Tallahassee – 125.58% – Down 1.02%
  • Port St. Lucie – Up 67.57% – Up 18.10%
  • Gainesville – Down 6.85% – Up 23.64%
  • Deltona-Daytona Beach-Ormond Beach – Down 16.42% – Up 1.20%
  • Naples-Immokalee-Marco Island – Up 4.71% – Up 48.33%
  • Florida (statewide total) – Up 10.18% – Up 30.97%

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Hurry: Fla. license renewal deadline is March 31

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Average mortgage rates fall again: 30-year at 4.31%

WASHINGTON (AP) – March 14, 2019 – U.S. long-term mortgage rates fell this week, with the benchmark 30-year home loan reaching its lowest level in more than a year as a potential inducement to homebuyers.

Continued uncertainty over Britain’s scheduled departure from the European Union suppressed interest rates on U.S. Treasury bonds and consequently mortgage rates.

Mortgage buyer Freddie Mac says the average rate on the 30-year, fixed-rate mortgage declined to 4.31 percent from 4.41 percent the previous week. The latest 30-year average rate was the lowest since February 2018. The average stood at 4.44 percent a year ago.

Mortgage rates climbed for much of 2018 and peaked at nearly 5 percent in early November.

The average rate this week for 15-year, fixed-rate loans slipped to 3.76 percent from 3.83 percent a week earlier.

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Is your website bringing you business?

LAS VEGAS – March 14, 2019 – Real estate professionals need to be able to drive people to their websites. They can accomplish this through email, blogging and print marketing, but it can be a challenge to do this right the first time.

To create the perfect website, they must first select the right domain name; choose a web host and web designer; and get a template that will allow them to change the text, pictures and links without paying additional money to the designer to add more content.

They should then work to add additional content every month, keeping in mind that creating a website isn’t an overnight process. Once they have created their website, they can enhance it by focusing on the consumer and providing relevant information; offering property search features with multiple, high-quality digital images; providing virtual tours; and creating forms where visitors can offer their personal information in exchange for valuable information.

Ultimately, they need to ensure their site stands out, which can be accomplished by incorporating online video, among other things.

Source: Realty Times (03/13/19) Devitre, Doug

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Register now for Florida Realtors Convention and Trade Expo

Florida Realtors Convention & Trade Expo offers CE credit, Expo, ed sessions, Bravo’s Million Dollar Listing’s Ryan Serhant and more for only $150 – and free for 300 first-timers.

 

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FEMA flood insurance plan might upend premiums

WASHINGTON – March 13, 2019 – The Federal Emergency Management Agency (FEMA) is working on a plan to update and extend the National Flood Insurance Program (NFIP), which Congress may or may not go along with as it considers new flood insurance policy. The proposal could change the way NFIP calculates the rates for homeowners, possibly saving money for some people but raising the cost significantly for others – notably those in flood areas or facing other risk factors.

Rather than levy premiums based on the dollar amount of insurance a homeowner wants, NFIP might operate more like property insurance, weighing a roster of risk variables and personalizing premiums.

Currently, flood insurance rates are generally based on the amount of coverage a homeowner wants and the risk of flood faced – largely whether the home is inside or outside a FEMA-designated flood zone.

Florida – home to about 35 percent of all NFIP policies – could see a major impact from proposed changes if they become official, though plan details have not yet been announced, and it’s unclear how any specific homeowner might be affected. However, it’s likely that homeowners in flood zones would see an increase in their flood insurance costs.

When asked by Bloomberg to comment on proposed changes, FEMA offered a statement by David Maurstad, deputy associate administrator for insurance and mitigation. He said the new system “will help customers better understand their flood risk and provide them with more accurate rates based on their unique risk.” According to the theory, homeowners who understand their flood risk will be more willing to buy coverage.

Bloomberg says FEMA’s document offers an example of two homes in a 100-year flood plain. One may sit near the edge and be threatened by only one type of flood event. FEMA says this home might see its costs drop by 57 percent. A second home in the middle of a flood plain facing multiple types of flood threats, though, could see its flood insurance costs more than double.

However, a FEMA spokesperson also said that some of the information given to Bloomberg is no longer accurate – but didn’t say which parts.

FEMA calls its new flood-pricing proposal Risk Rating 2.0 and says it’s being released at a time when climate change is influencing the national program, which is already in deep debt.

Congress is simultaneously working on its own flood insurance update, and committees meeting this week will discuss it. It’s unclear how much FEMA’s plan could influence Congressional actions. However, FEMA says it has the authority to update NFIP on its own even if Congress fails to pass a comprehensive plan.

Source: Bloomberg, March 12, 2019, Christopher Flavelle

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Dear agents: We still need you. Love, home sellers

NEW YORK – March 13, 2019 – According to a new survey by Clever Real Estate, homeowners are often unaware of the costs associated with selling a home. Of those who plan to sell through for sale by owner (FSBO), 53 percent are not comfortable negotiating without an agent. Moreover, 62 percent of all home sellers and 46 percent of FSBO sellers are uncomfortable filling out and completing the necessary paperwork by themselves.

The survey of 1,000 home sellers found that 45 percent of home sellers believe buyers pay their own commission, even though sellers actually pay the commission fees in almost all transactions.

Further, just 35 percent of sellers had any realistic idea about commission fees, though only 19 percent of those polled felt Realtor fees are reasonable and fair.

Ultimately, the survey underscored the importance of real estate agents taking the time to explain the home selling process and commission structure when starting any relationship with a seller.

Source: Realty Times (03/06/19) Babich, Luke

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Lawmakers looking at algae and water quality

TALLAHASSEE, Fla. – March 13, 2019 – A pair of environmental bills aimed at boosting water quality regulations began moving in the Florida Legislature with bipartisan support Tuesday as lawmakers work to address the algae problems that have plagued the state.

One bill would result in fines for municipalities after sewage spills, while the other would increase regulations on the spreading of biosolids, or human waste left over from the municipal sewage treatment process.

The nutrients found in human waste can feed algae blooms such as toxic red tide, brown tide and blue-green algae.

All three types of algae impacted Florida in 2018, killing fish, fouling waterways and hurting local economies.

Gov. Ron DeSantis has made water quality a top priority, and lawmakers from some of the affected regions have filed a slew of environmental regulation and funding bills.

Environmental advocates said the two measures dealing with municipal sewage are the first major algae-related water quality regulation bills to gain traction in the 2019 legislative session, which began last week.

The sewage spill measure sponsored by Sen. Joe Gruters, R-Sarasota, and Rep. Randy Fine, R-Palm Bay, would fine municipalities $1 for every gallon spilled. To avoid paying the fine a utility provider could also “spend $2 for each gallon (spilled) to upgrade or remediate the problems that gave rise to the unlawful discharge,” according to the legislation.

The bill also includes a public notice requirement that would put pressure on municipalities by forcing them to send a letter to homeowners when there is a spill nearby. Fine said the idea is to get homeowners incensed enough to demand local officials take action.

The biosolid and sewage spill bills cleared their first committees in both the House and Senate Tuesday with broad support and the backing of environmental groups, a rarity in the GOP-controlled Legislature.

Gruters and Fine both come from regions impacted by severe algae problems. Red tide plagued Sarasota and communities through Southwest Florida last year, while Fine lives in Brevard County, which has experienced a series of brown tide algae blooms.

Fine noted that Brevard had a massive sewage spill after Hurricane Irma in 2017. The hurricane overwhelmed sewage systems across the state and led to sewage discharges in 39 counties, including Sarasota and Manatee. Irma caused about 30 million gallons of sewage to be dumped into the Indian River Lagoon, according to Florida Today.

The sewage may have contributed to a brown tide bloom in the lagoon that persisted for months after Irma, with dead fish and human feces floating in the waterbody. Brown tide has been a problem in the region for years. Some have blamed the algae outbreaks on septic tanks, which Fine tried to regulate two years ago without success. Gruters and state Rep. Will Robinson, R-Bradenton, are pushing a similar septic tank inspection bill this year in response to the red tide algae bloom.

Fine said after encountering resistance to new septic rules from homeowners who said local government should clean up their sewage problems first, he decided to switch gears and focus on municipal sewage spills.

At the same time Brevard was experiencing a big sewage spill last year, Fine said the county approved spending millions on parks and other programs, including a kayak launch near a location where sewage was spilling.

“For too long we’ve had a problem where parks are more fun to talk about than pipes,” Fine said.

Local governments are not doing enough to update their wastewater systems, he added. He believes part of the reason is that the penalties are not severe enough.

No municipal leaders spoke during the environmental committee meetings in the House and Senate Tuesday, but some city leaders have concerns about the bill.

“I think it all sounds good and it’s all well intended, but I think we have to look at a more effective strategy,” Sarasota City Manager Tom Barwin said recently in arguing that local governments need more financial assistance from the state and federal government to improve wastewater infrastructure. The city of Sarasota had a sewage spill in December that released 900,000 gallons of wastewater, with some of it flowing into Sarasota Bay.

Aging infrastructure is a major problem that can lead to broken pipes, but spills also can be triggered by storm events, human error and a host of other causes. Barwin said Sarasota’s spill was a freak accident brought on by heavy rains. He has argued that penalizing municipalities would place a great strain on local governments and their taxpayers.

Fine said he had little sympathy for cities and counties complaining about the cost of fixing infrastructure. He argued that local governments need to prioritize their spending.

Some lawmakers wondered about the cost of the legislation during the House Agriculture and Natural Resources Subcommittee hearing Tuesday. “How do we prevent them from passing that charge on to their customers?” asked Rep. Mike Hill, R-Pensacola.

Fine said local officials ultimately are accountable to voters. Environmental groups largely praised the bill, including Florida Conservation Voters and the Sierra Club. But Sierra Club lobbyist David Cullen told a Senate Environmental & Natural Resources Committee that there has been “considerable resistance” in the Legislature to helping local governments with infrastructure improvements.

“We are looking forward to working with the sponsor to make sure that any fines are devoted to addressing the problem, perhaps on a statewide basis,” Cullen said. “We don’t want to assume that everything is due to incompetence.”

The debate on biosolids – also known as sewage sludge – stretches back decades but flared up again in many communities during the recent spate of algae blooms.

The Florida Department of Environmental Protection developed rules for the use of biosolids – which are used on farms as a fertilizer or disposed of by burning or dumping in landfills – in 1990 and then updated them in 1998 and 2010, according to the House staff analysis of the biosolid bill. The 2010 revision was partly aimed at improving “nutrient management.” It incorporated “nutrient management plans” into biosolid permits issued for agricultural sites.

But some communities have continued to express concerns that the biosolids rules were not strong enough to prevent water quality problems. Last year DEP created a biosolid technical advisory committee that met four times to discuss the problem.

Sen. Debbie Mayfield, R-Melbourne, said the biosolid bill she sponsored (SB 1278) is the result of that committee’s work.

“This is addressing right now what we think is an inferior permitting process,” said Lisa Rinaman, who advocates for water quality issues in the Northeast Florida area around the St. John’s River.

Mayfield said that as communities in the southern reaches of the St. Johns worked to restrict the land application of biosolids within their boundaries, the problem was pushed to the north and continued to impact the river.

The regional planning councils that help coordinate land-use management in two other areas impacted by recent algae blooms – Southwest Florida and the Treasure Coast – also have expressed concerns about biosolids. Both passed resolutions last year during the height of the algae blooms calling for the eventual elimination of biosolid application in those regions.

The biosolid bill instructs DEP to begin rulemaking later this year to tighten the rules on biosolids. It directs DEP to adopt rules that “permit the use of biosolids in a manner that minimizes migration of nutrients and that prevents impairment of surface water and groundwater quality.”

A range of environmental groups expressed support for the bill.

“We do believe this is a step in the right direction,” Rinaman said.

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Fla. homes spark almost 1 in 10 mortgage requests

CHICAGO – March 12, 2019 – Florida ranked as the No. 1 place for buyers, according to a recent Lending Tree survey.

Out of all mortgage requests made during the study, 9.1 percent were for homes in Florida, and moving companies that worked with out-of-state homebuyers reported that 12.4 percent of all requested destinations were in Florida. Builder magazine calls Florida’s growth “explosive.”

The study broke Florida down into five distinct housing markets.

“In Southwest Florida you have a lot of retirees. In central Florida you have retirees and international buyers,” says Tony Polito, Metrostudy’s regional director for the Tampa area. “In South Florida you have a lot of international buyers.”

The largest pool of buyers in Jacksonville are first-time and entry-level buyers impacted by a lack of choices and affordability. In Central Florida, there is local demand as well as a diversified base of buyers that includes investors, seasonal residents, international and vacation homebuyers.

High demand and low inventory have pushed prices up, according to Toby Hoff, Metrostudy regional director.

“Builders moving out of the core areas of Central Florida have been able to bring more affordable homes online. Buyers in this supply-constrained market are now willing to deal with longer commutes or less-than-desirable schools in order to find something that is both new and in their price range,” he says.

Although Tampa, Sarasota and St. Petersburg are all interconnected, they are very different housing markets, with Tampa booming and generating new jobs.

“We have two counties that account for 90 percent of the housing activity. Hillsborough, which the city of Tampa sits in, and Pasco County to the north,” says Polito. “Between Pasco and Hillsborough County, today we have a 14.8 month supply of vacant lots. Market equilibrium in this market is 24 to 36 months. Anything below 24 months means land prices are still rising. You can’t even find a small orange grove to develop.”

Source: Builder (03/11/19) Sowers, Scott

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Great American Realtor Days: Last chance to register online

Help your fellow Floridians March 18-20 at GARD – your chance to explain real estate industry concerns to state lawmakers. But hurry – online registration ends today. https://www.floridarealtors.org/LegislativeCenter/Great-American-Realtor-Days.cfm  

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Simple steps can protect your identity from cybertheft

NEW YORK – March 12, 2019 – Brace yourself for some cold, hard facts.

Cybercriminals will steal an estimated 33 billion records by 2023, according to Juniper Research, a firm that forecasts tech trends. Half of all data breaches globally will occur in the U.S. alone, Juniper says.

Joshua Lamont, 44, founder of JRL Strategies, a communications consultancy in Menlo Park, California, knows the crushing impact of cybertheft firsthand.

“In 2015, my dad and I were traveling for Thanksgiving,” Lamont says. “That day, we woke up to find more than $25,000 in fraudulent charges on my credit cards, and cash had been stolen from my bank account.”

Lamont’s mom had recently died; the bank believes someone got hold of her Social Security number, and later his. Lamont thinks it’s because he was added to a joint account his father had shared with his mother.

Over four weeks, thieves spent $13,000 from his personal and business accounts combined, $7,400 on his business credit card, and $5,800 out of the joint account shared with his father. Says Lamont: “They spent the money on an adult website with models who were tipped or given tokens paid for with my identity.”

“With data breaches occurring so frequently, much of your personal information has become available for sale on the Dark Web to identity thieves,” says Steven J. J. Weisman, a lawyer in Amherst, Massachusetts. “Being aware of this, the best place to find help is at the end of your own arm.”

Here are seven ways to protect your digital assets online.

Use strong passwords

A common mistake is using the same password for each account.

“Once a hacker figures out your easy password, then they can access all of your accounts,” says Mark Moss, a market analyst in California, who uses LastPass, a free web browser plug-in that creates and manages his passwords.

Moss, who is based in Orange County, California, advises creating passwords with at least eight characters, uppercase and lowercase letters, numbers, symbols and special characters.

Two-factor authentication

The username and password are easy bait for cybercriminals.

“Add another layer of security to an online investment portal by enabling 2FA in your account’s privacy or security settings,” says Frances Dewing, CEO of Rubica Inc., a cybersecurity solutions firm in Seattle. “A code is sent via a text or app to your smartphone, and anyone trying to gain access will need both your password and this code, which changes each time you log in.”

Freeze your credit

A security freeze prevents lenders from accessing your credit reports. “A fraudster trying to open an account in your name should be promptly rejected because the lender will be unable to verify the borrower’s creditworthiness,” says Taylor Jessee, a CPA and CFP in Richmond, Virginia. “This is a highly effective precaution, and it’s free and easy to do.”

To place a security credit freeze on your files, contact Equifax, TransUnion, and Experian directly. If applying for new credit, the bureaus are legally required to “unfreeze” your credit, Jessee says.

Use biometrics

“Biometrics utilizes your unique physical or behavioral characteristics to grant access to your most secured files,” says Daniel R. Hill, president of D.R. Hill & Associates, an investment advisory in Richmond, Virginia. “I suggest clients use it for bank accounts, retirement portfolios, and credit cards to employ fingerprinting, vocal vibration, or retina scan to receive access to digital files.”

Understand your risk

Shortly after his 67th birthday, James Shambo of Colorado Springs, Colorado, received a letter congratulating him on initiating his Social Security benefits. Though he was a retired CPA, he opted to wait until age 70 to receive benefits.

“Further digging uncovered that a thief had received $19,235 of my benefits,” says Shambo, now 68. “I was dumbfounded.”

Anyone age 62 to 70 who has yet to apply for benefits is at risk, particularly if your personal information was exposed in the July 2017 Equifax breach, advises Shambo.

Before the breach, he had frozen his credit files. However, the thief had Shambo’s benefits direct-deposited into an account opened with a bank that does not perform credit checks before issuing prepaid Visa debit cards.

Shambo contacted Social Security, and it froze further payments. He also filed a police report with a case number and had electronic access to his account blocked. Now, he will have to battle with Social Security, the IRS and later Medicare to sort things out.

To protect themselves from identity theft, people should to check out the American Institute of CPA’s 360 Degrees of Financial Literacy site, says Jon Lynch, manager of public relations for the institute.

Seek out fraud protection

Ask about security for each entity with which you have accounts.

“Consumers can password-protect bank accounts so that an individual can’t go into a branch and conduct transactions without it,” says Eva Velasquez, president and CEO of Identity Theft Resource Center, a nonprofit that helps identity theft victims resolve cases at no charge.

Act to minimize losses

Lamont, the cybertheft victim from California, snapped into action once thieves gained access to his accounts.

“I switched banks and opened new accounts with extra measures, so I receive alerts for nearly every transaction,” he says. “I also worked with the Department of Veterans Affairs to get an independent fiduciary appointed to handle my dad’s VA disability benefits.”

Next, he eliminated all credit cards. Now, he constantly changes passwords, uses two-party authenticators and keeps two months’ rent, cash and prepaid Visa cards on hand.

“We’ve recovered, but we’ve never been the same.”

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U.S. housing starts climbed 18.6% in Jan.

WASHINGTON (AP) – March 8, 2019 – U.S. housing starts jumped 18.6 percent in January, as builders ramped up construction of single-family houses to the fastest pace in eight months.

The Commerce Department said Friday that January ground breakings occurred at a seasonally adjusted annual rate of 1.23 million. Home construction rebounded sharply from December, when the annual rate was just 1.04 million.

Most of the new construction came from single-family houses, which were being built at the strongest rate since May 2018. Still, overall housing starts in January were slightly below the 2018 total of 1.24 million as the pace of apartment construction slowed.

The housing market was hurt for much of 2018 by rising mortgage rates, which made it costlier to purchase a home. But average rates have declined since early November and the average 30-year rate was 4.41 percent this week, providing a possible boost for home buying this year.

Permits for construction, an indicator of future activity, improved 1.4 percent to a seasonally adjusted rate of 1.35 million. The permits suggest additional apartment construction in the coming months, as that segmented accounted for the gains. Single-family permits fell 2.1 percent in January to an annual rate of 812,000.

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FBI opens Miami task force to stop foreign corruption

MIAMI – March 8, 2019 – The FBI is looking to clamp down on foreign corruption with a new task force in Miami, a city that has long served as a gateway for illicit money laundering.

The squad will concentrate on Miami and on international corruption in South America, according to the Associated Press. The FBI said it often finds people hiding their money in luxury South Florida real estate and luxury boats. And in recent months, federal authorities have uncovered a number of high-profile money laundering cases tied to Miami area real estate.

The task force will look to find individuals and companies who violate the Foreign Corrupt Practices Act, or those who are looking to bribe foreign officials. The federal agency said it is also working with companies to educate them about corruption and to self-report illicit behavior, according to the AP. The office will open this month and have six agents.

Most recently, top Venezuelan officials allegedly siphoned money out of the country’s state oil company and into South Florida real estate properties, including two condos at Dezer Developments Porsche Design Tower and one condo at Related Groups Icon Brickell.

But developers and real estate agents have minimal obligations to perform due diligence on their buyers or where the money came from, according to a Real Deal investigation last summer.

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U.S. mortgage rates up this week; 30-year at 4.41%

WASHINGTON (AP) – March 8, 2019 – U.S. long-term mortgage rates rose modestly this week, but they remain slightly lower than they were a year ago.

Mortgage buyer Freddie Mac says the average rate on the benchmark 30-year, fixed-rate mortgage increased to 4.41 percent from at 4.35 percent during the prior week. The average was 4.46 percent a year ago, but rates climbed for much of 2018 and peaked at nearly 5 percent in early November.

The average rate this week for 15-year, fixed-rate loans rose to 3.83 percent from 3.77 percent during the prior week.

Mortgage rates often move in sync with the interest paid on 10-year U.S. Treasury notes. Rising rates in 2018 suppressed home sales, but the lower levels in recent months point to the possibility of sales gains this year.

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NAR: Majority of real estate firms remain optimistic

WASHINGTON – March 7, 2019 – The evolving technological landscape, competition from nontraditional market participants and housing affordability continue to be among the biggest challenges facing real estate firms in the next two years, according to a report by the National Association of Realtors® (NAR).

NAR’s 2019 Profile of Real Estate Firmsfound that commercial real estate firms were more likely than residential firms to cite local or regional economic conditions as the biggest challenges, while residential firms were more likely to mention competition from non-traditional market participants and virtual firms.

The survey found that the vast majority of firms have an optimistic outlook for the industry’s future growth. Although expectations have slightly decreased from last year’s survey, firms remain confident and expect profits from real estate activities to increase or stay the same over the next year.

“Real estate firms continue to look optimistically toward the future, with a majority expecting profits to increase in the next two years. These trends are positive signs, particularly in our constantly evolving industry,” said NAR President John Smaby.

The report is based on a survey of firm executives who are members of NAR and provides insight into firm activity, the scope of benefits and education provided to agents and future market outlooks.

The report shows that almost 60 percent of firms expected profitability (net income) from all real estate activities to increase in the next year. Forty-four percent of firms expected competition from virtual firms to increase in the next year and 43 percent expected the same from non-traditional market participants.

“It is clear that the real estate industry is rapidly changing, and with that comes growing competition in the market,” said NAR CEO Bob Goldberg. “NAR continues to stay ahead of the evolving trends in technology as we work with market disruptors to best serve our members and ensure they have the resources needed to be successful.”

Firms also predicted the effects different generations of homebuyers would have on the industry. Fifty-eight percent of firms were concerned with millennials’ ability to buy a home while 46 percent experienced similar heartburn with millennials’ view of homeownership.

Firms typically had 30 percent of their sales volume from past client referrals and 30 percent from repeat business from past clients. Fifty percent of current competition came from traditional brick and mortar large franchise firms.

The most common benefit that firms offered to independent contractors, licensees, and agents was errors and omissions/liability insurance at 40 percent. Thirty-five percent of senior management received errors and omissions/liability insurance, 15 percent vacation/sick days, and 10 percent received health insurance.

That survey states that over 80 percent of real estate firms had a single office, typically with two full-time real estate licensees, down from three licensees in the 2017 report. Eighty-six percent of firms were independent non-franchised firms, 11 percent were independent franchised firms and 82 percent of firms specialized in residential brokerage.

Thirty-two percent of brokers of record were CEOs, presidents or owners, and 64 percent were regional managers or regional vice presidents.

Firms with only one office had a median brokerage sales volume of $4.2 million in 2018 (down from $4.3 million in 2016), while firms with four or more offices had a median brokerage sales volume of $100 million in 2018 (down from $235.0 million in 2016).

Thirteen percent of all firms had real estate teams, with a median of three people per team.

Real estate firms with one office had 18 real estate transaction sides in 2018 (down from 20 in 2016), while firms with four or more offices typically had 478 transaction sides (down from 550 in 2016).

Firms usually received 30 percent of their sales volume from past client referrals and 30 percent from repeat business, while 50 percent of current competition came from traditional brick and mortar large franchise firms.

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Fla. lawmakers seek permanent nationwide switch to daylight saving time

WASHINGTON – March 7, 2019 – The push to make daylight saving time permanent in Florida is going national.

Sens. Marco Rubio and Rick Scott and Rep. Vern Buchanan introduced the Sunshine Protection Act in Congress that would make daylight saving time permanent across the country.

Rubio also introduced a similar bill last year after the Florida Legislature passed a state law that calls for Florida to move to permanent daylight saving time, but that bill stalled. Florida’s law ending daylight saving time can’t go into effect unless the federal law is changed as well.

Florida is not the only state to call for an end to daylight saving time. California voters passed a referendum calling on their Legislature to end daylight saving time with nearly 60 percent of the vote.

Rubio re-filed his bill this year, saying Wednesday he was “reflecting the will of the state of Florida,” and Scott, the former governor and newly elected senator, joined as a co-sponsor.

Buchanan, who represents Florida’s 16th Congressional District in Manatee County, is sponsoring the bill in the Florida House of Representatives.

“Last year, Florida lawmakers were the first in the nation to vote to make daylight saving time permanent in our home state,” Buchanan said in a press release. “We should follow their lead at the national level to allow them to move forward with this change and ensure that Florida and the rest of the nation are on the same page year-round.”

The bill would essentially end the twice-a-year time change and stay on the time observed from March to November. It would apply nationwide except in states and territories that don’t observe daylight saving time, such as Hawaii and Puerto Rico.

Daylight saving time for 2019 begins at 2 a.m. Sunday and will end Nov. 3.

The United States began observing daylight saving at the end of World War I in an effort to conserve fuel. During World War II, the U.S. observed year-round daylight saving time from 1942 to 1945.

In 1974, the country tried to save fuel during the energy crisis by observing daylight saving time for 16 months, but the experiment was ended after less than a year when people became upset about children having to go to school in the dark.

The Florida PTA asked then-Gov. Scott to veto Florida’s bill last year when it passed the Legislature on the grounds that the change would put students at risk when they had to travel to school in the dark in winter months.

Scott signed the bill into law over those objections, and in a press release issued Wednesday said he was joining Rubio’s effort to pass the bill nationwide.

“I was glad to sign legislation as governor to continue daylight saving time year-round for Floridians, and now join Senator Rubio to lead this effort in Congress,” Scott said. “The Sunshine Protection Act will allow Floridians and visitors to enjoy our beautiful state even later in the day, and will benefit Florida’s tourism industry, which just celebrated another record year.”

Rubio’s office released a summary of the bill that listed seven benefits of passing a year-round daylight saving time, from reducing car crashes to cutting down on energy usage.

“Studies have shown many benefits of a year-round daylight saving time, which is why Florida’s Legislature overwhelmingly voted to make it permanent last year,” Rubio said.

It’s not clear if Congress will have any appetite for taking up the bill as it is consumed with issues surrounding President Donald Trump.

When asked by the News Journal on Wednesday by text message if he had a position on the bill, Rep. Matt Gaetz, replied with a simple answer.

“I don’t,” he said.

Copyright © 2019 Journal Media Group, Pensacola News Journal, Stuart News, Jim Little

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Visa program is bringing more Vietnamese investors to U.S.

NEW YORK – March 7, 2019 – Vietnamese investors are increasingly gaining on China as a significant source of participants in a foreign investment initiative by the United States that provides green cards for investing in U.S. real estate, The Wall Street Journal reports. 

The program, the EB-5 Immigrant Investor Program, offers green cards to those who invest in job-creating U.S. businesses or real estate projects. The percentage of EB-5 visas issued to Vietnamese nationals has surged 693 percent in the past fiscal year.

About 20 percent of current EB-5 investments in U.S. real estate now come from Vietnam, according to estimates from the U.S. Immigration Fund. Four years ago, Vietnamese barely accounted for 1 percent of these visas. But Vietnamese’s latest rise is now catching them up to other strong EB-5 investor populations, behind 25 percent of participants coming from India and 30 percent from China.

Realizing the stronger allure, several New York City developers are advertising their projects to Vietnamese investors through local agencies, The Wall Street Journal reports.

“In the past, any large-scale capital raise, anything over $50 million or $100 million, particularly in New York, you had to go to China,” Phuong Le, an immigration attorney and partner at David Hirson & Partners LLP, told The Wall Street Journal. Now, “most of the big New York real estate developers who were in China before are certainly all in Vietnam now.”

However, as wait periods for EB-5 visas have grown from months to years, some Chinese investors have pulled back.

Vietnam’s booming economy and its growing class of wealthy business owners have made the country a new source for the EB-5 program. However, the estimated visa wait time – up to 7.2 years as of last October – could be a hurdle that discourages more foreign investors from taking advantage, experts say.

Source: “Real Estate Developers Look to Vietnam for Cheap Financing,” The Wall Street Journal (March 5, 2019)

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Gov. DeSantis to lawmakers: Be bold on big issues

TALLAHASSEE, Fla. (AP) – March 7, 2019 – Republican Florida Gov. Ron DeSantis gave an anti-tax, pro-environment State of the State address Tuesday, asking lawmakers to be bold as they tackle issues like education, school safety and health care.

It was as much a recap of his whirlwind first two months in office as it was a blueprint for his goals as lawmakers begin their annual 60-day session.

The governor ticked through a list of what he’s already done, including securing hundreds of millions of dollars in federal aid to help Hurricane Michael recover; announcing an aggressive plan to address problems with red tide and algae; removing Broward County Sheriff Scott Israel for his handling of the Parkland high school shootings that left 17 dead; appointing three Supreme Court justices; and giving posthumous pardons to four black men accused of raping a white woman more than 70 years.

“And this is just the beginning,” DeSantis told lawmakers gathered in the House chamber. “Be bold. Be bold in championing economic opportunity, be bold in protecting Florida’s environment, be bold in improving education, be bold in defending the safety of our communities. Be bold, because while perfection is not attainable, if we aim high, we can achieve excellence.”

DeSantis said he wants to keep building Florida’s economy by keeping taxes low and reducing the regulatory burden on businesses and professional licenses.

“We need reform of our occupational licensing regime, which borders on the absurd and primarily serves to frustrate opportunities for Floridians,” said DeSantis, a former Navy officer. “You can become a sniper in the U.S. Marine Corps by completing training for 79 days, which is roughly 632 hours, and yet in Florida becoming a licensed interior designer in requires 1,760 hours. You can earn jump wings by completing Army Jump School in three weeks, or about 168 hours; Florida law requires 1,200 hours to become licensed as a barber.”

And in comments later praised by Democrats, DeSantis also said Florida’s environment must be protected and he’s taking steps to address red tide and algae blooms that have plagued the state.

“Given the persistent water problems we have seen over the past several years, now is the time to be bold,” he said. “With your support for these initiatives, we will restore and preserve the beauty of Florida for generations to come.”

Democrats, however, weren’t as pleased with DeSantis’ push to expand Florida’s school voucher program, which sends students to private schools at taxpayer expense. DeSantis outlined other education goals, like moving away from Common Core standards, streamlining standardized testing and putting a new emphasis on civics education. DeSantis also wants a strong vocational education options to prepare students who don’t want a four-year college degree.

“He’s hitting the right topics. He’s staying on message, he’s focused on the environment, he’s focused on education,” said Republican Sen. Jeff Brandes. “He’s got energy and I think what you’re seeing is he’s got support of the Legislature on many of these items.”

For Democrats, the speech was a mixed bag.

“There were a couple of things I thought were great, and a couple of things that I though weren’t so great,” said Democratic Rep. Richard Stark. “I’m glad that the governor is taking notice on the environment. I’m glad that he wants to work on education. My problem with education is that I’m not happy about expanding charter schools and vouchers.”

Stark did say that DeSantis is already an improvement over predecessor Rick Scott, who’s now a Republican U.S. senator.

“Governor Scott was very difficult, even to get him to do environmental stuff,” Stark said. “We voted to on money to improve the Everglades – a lot of money – so that bad stuff wasn’t flowing out from Lake Okeechobee. The last governor didn’t do anything; he just sat on his hands. This man, right away, he decided to do something.”

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Act now: Fla. license renewal deadline is March 31

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New-home sales in U.S. rose 3.7% in Dec.

WASHINGTON (AP) – March 6, 2019 – Sales of new U.S. homes climbed in December to their highest pace in seven months, a sign that lower mortgage rates are helping the real estate market.

The Commerce Department said Tuesday that new-home sales rose 3.7 percent in December to a seasonally adjusted annual rate of 621,000. November’s sales were revised down to 599,000 from an annual rate of 657,000.

For all of 2018, new-home sales rose 1.5 percent. Purchases began to dip in June as higher mortgage rates worsened affordability, but mortgage rates have fallen since peaking in early November and that appears to be supporting a sales rebound.

The sales gains point to a potentially stronger 2019. The purchase of new homes not yet under construction surged 22.4 percent in December from the prior month. Average 30-year mortgage rates at 4.35 percent, down from nearly 5 percent in early November, have also eased some affordability pressures.

Price growth has stalled as sales sipped last year. The median sales price of a new home in December was $318,600, a 7.2 percent drop from a year ago.

Sales increased in December in the Northeast, South and West. But purchases fell in the Midwest.

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America’s 19- to 29-year-olds are facing $1 trillion in debt

NEW YORK – March 6, 2019 – The New York Federal Reserve Consumer Credit Panel reports that debt among 19- to 29-year-old Americans topped $1 trillion at the end of 2018, the highest debt exposure for young adults since late 2007.

Student loans make up the majority of the debt, followed by mortgage debt. Spending among those under age 35, however, has slowed compared to other generations, according to a University of Michigan survey.

The survey says weakened job prospects, delayed marriage, and educational debt may have played a role in their reduced spending.

Meanwhile, new mortgages among young adults today remain below levels incurred in the early 2000s, and implied debt that is 90-plus days delinquent for student loans dwarfs other loan-type categories.

At the end of 2018, auto loans were the third largest portion of debt composition in the United States, with overall consumer debt reaching a record $13.5 trillion.

Source: Bloomberg (02/25/19) Tanzi, Alexandre; Lu, Wei

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Top 10 cities with high homeownership among low-income families

SEATTLE – March 6, 2019 – Minneapolis may offer the most possibilities for low-income households to become homeowners. The city has the nation’s highest homeownership rate among households in the bottom 25 percent of income at 57.7 percent, according to a new analysis from Redfin of the 50 largest metros. Pittsburgh and St. Louis followed on the list, also having homes that tend to sell for less than the national median of $285,000.

“Homeownership allows people to share in the prosperity of their communities and gain wealth through home equity,” says Redfin Chief Economist Daryl Fairweather. “In many expensive metros, low-income residents aren’t able to access the benefits of homeownership because of a lack of affordable starter homes. But in areas like Minneapolis and Pittsburgh, low-income workers are still able to get their foot in the door on the American dream of homeownership.”

The following are the metros with the highest homeownership rates for low-income households, according to Redfin’s analysis:

1. Minneapolis
Homeownership rate among households in bottom 25% of income (2017): 57.7%
Median sales price: $255,000

2. Pittsburgh
Homeownership rate among low-income households: 55.8%
Median sales price: $149,000

3. St. Louis
Homeownership rate among low-income households: 55.5%
Median sales price: $173,000

4. Detroit
Homeownership rate among low-income households: 55%
Median sales price: $122,000

5. Tampa, Fla.
Homeownership rate among low-income households: 54.4%
Median sales price: $220,000

6. Louisville, Ky.
Homeownership rate among low-income households: 54.2%
Median sales price: $181,000

7. Salt Lake City
Homeownership rate among low-income households: 53.8%
Median sales price: $319,000

8. Nashville, Tenn.
Homeownership rate among low-income households: 53.7%
Median sales price: $284,000

9. Charlotte, N.C.
Homeownership rate among low-income households: 53.1%
Median sales price: $230,000

10. Philadelphia
Homeownership rate among low-income households: 52.6%
Median sales price: $190,000

Louisville, Charlotte, and Nashville saw the largest uptick in low-income homeownership from 2012 to 2017.

Meanwhile, some metros – particularly the pricey coastal markets – saw some of the lowest amount of low-income homeownership (bottom 25 percent of income earners in 2017). Those metros are Los Angeles (31%); New York (35%), San Diego (37.6%), Las Vegas (39.7%), and Columbus, Ohio (39.8%).

Source: “Minneapolis, Pittsburg and St. Louis top metros with highest homeownership rates for low-income families,” Redfin (March 4, 2019)

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What are ‘granny flats’ – are they next bargain homes?

FORT LAUDERDALE, Fla. – March 5, 2019 – South Florida’s affordable-housing crisis could be alleviated by legislation that the state approved 15 years ago, encouraging cities to allow single-family homeowners to build a second dwelling on their properties that can be rented out to very low- to moderate-income wage earners.

Recent studies demonstrate that South Florida has the nation’s highest percentage of severely burdened renters, with more than a third paying more than half their income on housing.

Broward County is now considering the little used legislation, actively discussing “accessory dwelling units.” If Broward commissioners approve a proposed land-use change supporting the secondary units, it still would be up to individual cities to decide whether they want to open their neighborhoods to an influx of new dwelling units and the people who would live in them.

“To solve the affordable-housing crisis, we’re going to have to use multiple options,” said Commissioner Nan Rich. She said the units not only provide affordable housing for the renters but also can create income that makes homeownership more affordable for the property owner.

Under the state statute and county proposal, the dwelling can be free-standing, an addition attached to the primary home, or the conversion of a garage or other living space into a second unit with its own entrance.

Homeowners, however, would have to commit to renting it to a person or family making no more than 80 percent of the county’s median household income – currently no more than $51,750 for a two-person household. The rent for a two-person household would have to be less than $1,300 a month. The unit also would need to have a kitchen, a bathroom, and a separate entrance.

Source: South Florida Sun-Sentinel (02/22/19) Barszewski, Larry

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U.S. construction spending drops 0.6% in Dec.

WASHINGTON (AP) – March 5, 2019 – U.S. construction spending edged down 0.6 percent in December with declines in residential construction and government projects. Even with the December setback, construction spending for all of 2018 reached record levels, though it was the smallest increase seven years.

The December decline followed a 0.8 percent rise in November, the Commerce Department reported Monday. Residential construction fell by 1.4 percent, revealing ongoing struggles in the housing sector. Nonresidential activity rose 0.4 percent, while spending on government projects fell 0.6 percent, with both federal and state and local activity falling.

For the year, construction spending rose 4.1 percent to $1.3 trillion. It was an all-time high, but the 4.1 percent gain was the weakest performance since spending fell 2.6 percent in 2011.

Construction spending had hit a previous record high of $1.16 trillion in 2006, the peak of a housing boom that would begin declining in 2007, helping to trigger a deep recession and five-year retreat in construction spending.

Beginning in 2012, construction activity started rising again and in 2016 surpassed the 2006 high. After double-digit gains of 11 percent in 2014 and 10.7 percent in 2015, spending increases have slowed in the past three years.

The drop in residential activity in December reflected a 3.2 percent fall in single-family construction which was partially offset by a 3.1 percent rise in apartment construction.

The 0.4 percent increase in nonresidential construction reflected a solid 1 percent gain in hotel and motel construction, but a flat reading for office construction and a 1 percent drop in the category that includes shopping centers.

The 0.6 percent fall in public construction echoed a sharp 2.2 percent drop in spending by the federal government and a 0.5 percent fall in construction spending at the state and local levels.

The December construction spending report was one of a number of government reports that have been delayed because the 35-day partial government shutdown.

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‘It’s pure hell’: Hurricane Michael leaves housing crisis

PANAMA CITY, Fla. (AP) – March 5, 2019 – A small village of the forgotten has popped up in Diahnn “Shelly” Summers’ backyard outside Panama City. Where there once was empty grass abutting almost 5 acres of woods, 10 tents now encircle a fir tree with Christmas lights.

The tents shelter those still homeless more than four months after Hurricane Michael screamed ashore with 155-mph winds, flattening, blowing away or rendering uninhabitable thousands of houses.

“There is nowhere for them to go,” Summers said. “When you don’t have a home, you have no sense of safety, no sense of belonging, no security. You don’t even know where you’re going to sleep without getting into trouble. It’s the worst feeling.”

Of all the Florida Panhandle areas affected by Michael, Bay County was hardest hit: Officials said almost three-quarters of its 68,000 households were affected. Former Florida House Speaker Allan Bense, who is leading a hurricane recovery initiative, estimated about 20,000 people were homeless in the weeks after the October storm.

Some have been able to make their homes livable again with cosmetic repairs. Others left town: The county’s student population is down 14 percent. And 7,800 residents are still considered homeless, county officials said.

Many unable to move in with relatives or find a coveted hotel room with the help of federal vouchers have turned to living in tents.

Several obstacles prevent their return to normalcy. Trailers from the Federal Emergency Management Agency have been slow to arrive, and it’s hard to find an apartment where the rent hasn’t been jacked up in a suddenly tight market. Almost three-quarters of the damaged properties were rental units, which are difficult to replace with temporary shelter, Bay County Manager Robert Majka said.

“If you have 100 units in an apartment complex, you can’t put 100 FEMA trailers into that apartment complex and accommodate these folks,” he said.

Sue Laurel Shaw was able to stay in her apartment after the storm and said her landlord even agreed to deduct the cost of repairs she made from the rent. But now she faces eviction for back rent after she says the landlord reneged on their agreement.

She is looking for another place to live, but “everything is tripling,” said Shaw, who was fighting to stay in her Panama City apartment.

Mystie Gregory said she, her fiance and 2-year-old daughter left their apartment for several days to take a break from living without electricity. When they returned, she said, it had been rented to another family.

Gregory found refuge with more than a dozen others living in tents behind Summers’ ranch-style house.

Gregory said she is trying to “make the most” of living in a tent, but “it makes you feel like a failure as a parent, even though it’s out of your control.”

Among the county’s homeless are 4,700 students, said Bay District Schools Superintendent Bill Husfelt. Some schools lost more than 40 percent of their students and the school board is closing at least three schools for now.

“It’s all about housing,” Husfelt said. “Everything we’re dealing with, it’s about housing.”

In December, U.S. Sen. Marco Rubio wrote a letter chastising FEMA for not finding enough sites for trailers or mobile homes. Rubio said families “have not seen an appropriate response to their housing needs and FEMA must immediately act to address this concern.”

At the time, more than 1,200 Bay County families were waiting for trailers or mobile homes. By the end of February, that number had fallen to more than 200, partially because more than 500 families had found other options on their own, county officials said.

“The velocity of FEMA’s temporary housing improved after the first of the year, although trailers … never came in consistently at stated goals,” said Joel Schubert, Bay County’s assistant manager.

FEMA officials said the large numbers of renters and the enormous amount of debris that needed to be cleared before trailers could be installed slowed the process.

In addition, 26,000 Florida households received grants for home repairs, 21,000 residents received temporary rental assistance and 2,000 households were approved for hotel rooms or short-term condo rentals, FEMA spokesman Samuel “Carr” McKay said in a statement.

Even that help took a while to reach some residents. Dennis Myrick, who has no home insurance, said he lived in a tent in the front yard of his decimated Panama City home until mid-January, when he was finally able to get a FEMA hotel voucher.

“It’s pure hell, man,” Myrick said. “The wind blows, and you get wet. I had to hold the tent down with my hands. It was about to blow away.”

Before she landed in Summers’ backyard, Jacinta Wheeler, whose apartment was damaged by the hurricane, joined other residents in an encampment dubbed “Tent City” in a different part of town. Officials forced them to leave over safety and hygiene concerns. Lori and Gene Hogan had settled in a tent on the beach after Michael destroyed their home, but police officers threatened to arrest them if they didn’t move, so they came here as well.

Wheeler has been working construction jobs and helping repair neighbors’ properties while she stays in her tent.

“Everybody wants the American dream,” the Trinidad native said. “If this is the dream, I don’t want it.”

Summers and her husband, Sam, want to build more permanent housing on the property for their guests but said they have run into regulatory roadblocks. In the meantime, they try to make them feel at home, inviting them to their dinner table and leaving the Christmas lights on the backyard tree to retain some cheer.

Summers said she has always welcomed people in need to her home.

“They need help and we were blessed enough that our house was untouched,” she said. “We seem to be the outcasts by trying to help people and it shouldn’t be that way. This should be a normal thing.”

Copyright © 2019 The Associated Press, Mike Schneider. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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More homeowners paying their mortgages on time

WASHINGTON – March 5, 2019 – More Americans are paying their mortgages on time than at any point in nearly two decades, according to the Mortgage Bankers Association.

Delinquency rates are a key economic measure, closely watched by economists. The last time a large number of homeowners stopped making mortgage payments on time, from 2007 to 2008, it impacted the entire economy.

Borrowers who have conventional mortgages are the most likely to pay on time, while borrowers with loans backed by the Federal Housing Administration tend to pay late nearly three times more often. (Still, 91 percent of FHA borrowers pay on time.) FHA borrowers tend to have lower credit scores, higher debt-to-income ratios, and lower downpayments. All three factors multiply the risk that borrowers will pay late, according to the MBA. But the FHA delinquency rate of 8.65 percent is still a big improvement over a decade ago, when it was about 14 percent.

Why are more Americans paying their mortgages on time? For one, more homeowners now have greater equity in their homes. They’ve paid down the mortgage while price inflation has increased their home values. Homeowner equity in the U.S. stands at $1.5 trillion, the highest on record, according to the Federal Reserve.

Also, stricter federal underwriting rules since 2010 have limited who can get a mortgage. Fannie Mae and Freddie Mac require borrowers to have an average FICO credit score near 750, which is much higher than they required before the financial crisis. However, “if the lending industry begins to relax underwriting standards in any significant way to dig deeper into the pool of riskier credit applicants to plump up their volume of home-purchase mortgages, it’s inevitable that delinquencies will rise,” writes Ken Harney, a syndicated real estate columnist for The Washington Post.

Some lenders have already started to loosen their standards. The average credit score of a mortgage borrower is on the decline, notes a study by FICO. Also, Fannie Mae has eased its policy on debt-to-income ratios and is allowing more applicants with ratios up to 50 percent to get approved for a mortgage. (Previously, the mortgage giant required 45 percent or less.) The FHA also has posted a decrease in average credit scores and is now approving debt-to-income ratios well above 50 percent.

Source: “More People Pay Their Mortgages on Time, Will This Good News Last?” The Washington Post (Feb. 27, 2019)

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