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Fla. Host of ‘Zombie House Flipping’ Can’t Find Homes to Flip

Justin Stamper says he’s digging through court cases to find flippable homes, but even those owners say, “‘Get off my phone! You’re the 26th person to call me today!’”

ORLANDO, Fla. – Justin Stamper, star of the “Zombie House Flipping” TV show, says finding places to renovate and sell in Orlando has become so hard that he sometimes has to dig through court cases in search of properties.

“I’ll get word through an attorney about a probate case, call the [homeowner] that day, and they respond, ‘Get off my phone! You’re the 26th person to call me today!’” said Stamper, 31, currently filming the fourth season of his show on A&E.

“We’re back to our grassroots,” he said. “We’re literally knocking on doors [for leads] in some cases.”

Soaring home prices and a shortage of inventory in Central Florida and across the nation is wreaking havoc on house flippers and wholesalers, people who make their living buying places at a bargain and fixing them up or selling them to other investors.

“We have investors calling us nonstop,” said Tammy Kerr of Sand Dollar Realty Group. “Unfortunately, we have way more buyers than houses to sell them.”

In metro Orlando, the median home price rose more than $30,000 from March 2020 to March of this year, according to the Orlando Regional Realtor Association (ORRA). Over the same year, inventory dropped to fewer than 3,000 housing units for sale in the region. Stick to just single-family homes and that number drops below 2,000, just three weeks’ worth of inventory.

That has meant there are fewer possible investment homes available. In the Orlando-Kissimmee-Sanford metro, a total of 3,219 homes were flipped, a drop of 8.7%, according to Attom Data Solutions, which analyzes the U.S. real estate market. Home-flipping activity around the country declined for the first time in six years.

The inventory crunch has hurt more than just investors, said Foster Algier, a real estate agent and owner of First Alliance Capital in Orlando.

“Say you sell even 3,000 houses in a month,” he said. “There are thousands of real estate agents in Orlando not getting a paycheck that month.” ORRA has 19,000 member Realtors, and they don’t account for every real estate agent in the area.

Algier points to low-interest rates as one of the main drivers of the housing shortage, with 30-year mortgage rates falling to less than 3% last year. “When money gets cheap, home prices go up,” he said.

Stamper said part of the problem stems from people who see real estate investment as a quick way to make money.

“There is such a low barrier of entry,” he said. “All you have to do is go on YouTube and there’s a million videos on how to wholesale.”

Algier also pointed to a glut of buyers and investors as reducing options.

“We’re paying more because we’re competing against buyers who will buy anything,” he said.

Kerr, who has worked in Orlando real estate for 20 years, said one advantage to the current market: flippers don’t have to do much work fixing up houses they sell. “People are buying up anything, they don’t care,” she said. “They’ll do the work for you.”

House flipping did continue to turn a profit for the people who were lucky enough to get properties to sell. In the Orlando area, Attom reports that the median profit from a flipped property rose to $54,500 in 2020, reflecting an 8% year-over-year increase in the return-on-investment ratio.

“Home flipping remained a good investment in 2020, while resale values rose and raw profits hit a highwater mark not seen since at least 2005,” said Attom’s chief product officer Todd Teta in an email.

Still, the lack of inventory makes finding properties a real challenge. Stamper, a lifelong Orlando resident, continues to hunt for houses in his hometown for his show. But with his business, Blueprint Real Estate Group, he’s been expanding his vision.

“I’ve started buying a lot more houses in the Tampa Bay area, to be honest,” he said.

© 2021 Orlando Sentinel, orlandosentinel.com. Distributed by Tribune Content Agency, LLC.

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Now Available: Landlord Applications for $850M in Rent Relief

Landlords can now apply for money to recoup lost rent. DCF debuted a website, OurFlorida.com, last week and started offering applications Monday. Landlords receive payments directly, but both landlords and tenants can apply for help.

ORLANDO, Fla. – Florida’s Department of Children and Families (DCF) now accepts applications from landlords and tenants, as well as utility providers, for past-due payments on a website created specifically for distribution of $850 million in federal recovery funds.

DCF announced the debut of a new website last week – OURFlorida.com (Opportunity for Utilities and Rental Assistance) – and the applications for funds went live on Monday. In addition to the application, DCF designed OurFlorida.com as a central hub for information, frequently asked questions (FAQs), auxiliary help and tools that can help spread the word about the program, though the latter has not yet gone live.

The site encourages landlords to apply, but tenants may also submit an aid application. If a tenant does apply and qualifies, DCF says the money will go directly to the landlord, either as a direct deposit or mailed check. The program requires proof of identity and financial information, and landlords are advised to work with tenants to secure the information needed.

An eligible household can receive up to $2,000 per month, which includes rent and utilities. A household’s maximum payment via the program is $15,000. If a tenant is in default for an amount greater than $15,000, landlords can still apply to receive that maximum amount.

For more information, visit the FAQ page of the website. Some answers of specific interest to landlords include:

Can I file an application on behalf of my tenant?

The application can be submitted by either a landlord or eligible tenant. The landlord’s and tenant’s identity must be established as a condition of eligibility. A renter must sign the application for assistance attesting that all information is correct. Required documentation may be submitted by the landlord on behalf of the renter, to the extent feasible.

How is assistance calculated?

DCF will look at a current lease – signed by the applicant and the landlord or sublessor – that identifies the unit and the rental payment amount where possible. Fees included in the lease, (separately identified or included in an overall rent payment), such as pet fees or garbage fees, are eligible for assistance.

DCF also has options for landlords without a signed lease.

The amount of late payments must be documented by a notice of late rent, a notice of eviction, eviction court filing information, or a signed attestation by the landlord.

All payments for utilities and home energy costs must be supported by a bill in the name of the tenant reflecting the address for each qualifying utility for a period after April 1, 2020. Utilities and home energy costs covered by the landlord are treated as rent. Arrearages owed in the name of the primary applicant for expenses after April 1, 2020 on a different property may be included. Telephone, cable, and internet are not considered utilities.

How do I apply?

Renters need:

  • Identification, such as driver’s license, birth certificate or passport.
  • Current lease agreement or other proof of rental arrangements, such as receipts, bank records or canceled checks that show a pattern of rent payments.
  • Documentation of annual income, such as 2020 tax filings, a W-2 or 1099 from their employer, or other proof of income; or documentation of monthly income, such as pay stubs, bank statements, income certification for housing subsidy, or other proof of income.
  • If they qualify for SNAP, TANF, Medicaid, subsidized housing or low-income housing, proof of eligibility documents.
  • Documentation of unemployment benefits or proof of reduction in household income or proof of increased costs (medical expenses, child care, transportation) due to the COVID-19 Public Health Emergency.
  • Notice of past due rent, lease termination or eviction, or condemnation order or failed inspection report from local government.

Landlords need:

  • Identification, such as a driver’s license, birth certificate or passport.
  • Verification of a property ownership or property management agreement executed with the owner.
  • Bank deposit information.
  • Notice of late rent, a notice of eviction, an eviction court filing.

To qualify, renters must:

  • Rent a home, apartment or other residential dwelling in Florida.
  • Earn an income at or below 80% of the area’s median income (AMI).
  • Have qualified for unemployment, experienced a loss of income, incurred significant costs or faced financial hardships due to the COVID-19 Public Health Emergency.
  • Are at risk of losing their home, experiencing housing instability or living in unsafe or unhealthy conditions.

What happens after an application is submitted?

A landlord may help a tenant complete an application, but the tenant must sign it. OUR Florida Program will then review the information to determine if additional information is required and verify the information. If the applicant is eligible for relief, the payment will be calculated. Once completed, the applicant will receive notification of eligibility, and payments will be made directly to the business, landlord and/or utility provider.

© 2021 Florida Realtors®

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NAR Counters Proposal Limiting 1031-Exchanges to $500K

Under Pres. Biden’s proposal, 1031 like-kind exchanges only defer $500K from taxation. NAR says not to panic, though. There’s time before any decisions are made.

WASHINGTON – President Joe Biden’s recent tax proposal includes a $500,000 limit on the amount of deferred gain from Section 1031 like-kind exchanges.

If the proposal becomes part of the official package that moves through Congress, it could present adverse consequences for communities and their economic development, according to Evan Liddiard, director of federal taxation for the National Association of Realtors® (NAR). Liddiard spoke during the Commercial Federal Policy Meeting at the virtual 2021 Realtors Legislative Meetings on Thursday.

Section 1031 allows investors to defer paying capital gains taxes on the exchange of one investment property if it’s replaced for another property of “like kind.”

Biden originally proposed during his campaign to do away with Section 1031 like-kind exchanges.

“We’ve been watching this for months now,” said Liddiard. “We’re not panicking, because we still have a long way to go before the proposal moves anywhere.” That said, NAR and other members of the Real Estate Like-Kind Coalition are redoubling their efforts to inform members of Congress about the mistake that would result from limiting like-kind exchanges. The organizations have already “had many discussions about the issue with members of Congress, especially on the Ways and Means Committee and the Finance Committee,” he added.

“We keep telling them that most 1031 deals are for mom and pops,” Liddiard said. “Their reaction has been, ‘Then we’ll limit them to $500,000.’ They think that’s going to be the answer. But it’s the big deals – the ones over that amount and many more times that amount – that have the potential to create the most jobs and do the most transformational work in cities and communities.”

The prospect that this move could lead to more draconian changes also concerns Liddiard.

“There’s always the ‘camel’s nose under the tent’ idea,” he said. “They put a $500,000 cap on it this year. Next year they come back and lower it again. Then finally they take it away altogether.”

In addition to meeting with representatives and senators, NAR is requesting examples from members about the benefits of 1031s, Liddiard said.

“We’re even creating an electronic input sheet on our website so that people can identify a 1031 they think should be highlighted as an example that can change a neighborhood or a community – create jobs and growth. We’ll take the examples to Congress to fight the myths surrounding 1031s and show why 1031s need to be preserved and celebrated.”

Source: National Association of Realtors® (NAR)

© 2021 Florida Realtors®

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Big RE Question: Will Workers Return to Offices?

NEW YORK – A growing number of states are lifting business constraints as the numbers of Americans vaccinated against COVID-19 continues to rise, leading people to shop, dine out and travel.

But the revival of one activity has been agonizingly slow: Working from the office.

The number of employee office visits in 10 large cities reached 26.1% of the pre-pandemic level the week ending April 21, according to Kastle Systems, the largest provider of technology that tracks such data through swipes of keycards and other devices. While Dallas and other Texas metro areas have solidly topped that average, cities such as San Francisco and New York have lagged.

The 10-city average is up from 22.9% in mid-January but has bounced around in the low- to mid-20s since last June, rising as much of the economy reopened last summer and dipping during events such as the winter storm that battered much of the country, particularly Texas, in mid-February.

“While the return to office is picking up slowly, we have not seen meaningful movement yet,” says Kastle Chairman Mark Ein. “It’s a very low number.”

Higher office occupancy is critical for the survival of downtown restaurants, shops and other businesses that rely heavily on purchases by office workers. Many outlets have permanently closed during the health crisis as central business districts turned into ghost towns. Office building owners are hoping for a comeback to minimize bankruptcies in that industry.

The outlook should brighten in coming weeks, Ein says, as a growing portion of the working age population gets their COVID-19 shots. President Joe Biden told states to make every adult eligible for a vaccine by April 19. By early June, most workers should be vaccinated and many could be back at their offices by July, at least some of the time, Ein says.

So far, 68.4% of people 65 and over – who typically are retired and not working in offices – have been fully vaccinated, compared with 30% of the total population, according to the Centers for Disease Control and Prevention.

“We think you’re going to see many more people coming to the office in the summer,” Ein says.

Another hurdle for America’s return to the office is that many companies and their workers have said they’re satisfied with remote work, believing it has improved productivity.

Paul Leonard, managing consultant at CoStar, a commercial real estate research firm, thinks office visits may remain depressed over the summer but should reach at least 50% after Labor Day and 80% by the end of the year. A Gartner survey of HR leaders at 130 companies in December found 90% plan to let employees work remotely at least some of the time even after much of the population is vaccinated.

Leonard reckons 10% of the workforce will work from home all the time, a third of the remainder will return to the office five days a week and two-thirds will let workers split time between the home and office. Based on those assumptions, 34% of the workforce would be remote on any given day.

Since Kastle’s systems track office visits rather than individual workers, a company that lets employees work at home two days a week would record visits that are 60% of their pre-pandemic level.

Lone Star State leads

Texas metro areas have well exceeded the 10-city average of 26.1%, with Dallas, Houston and Austin at 41.2%, 39.3% and 38.8%, respectively. The cities rely mostly on cars, rather than mass transit, where COVID-19 is easily spread, to get people to work, Ein and Leonard say.

Also, they say, the state lifted restrictions on shops and restaurants earlier and more aggressively than other states, an approach that combined with Texas’s more libertarian culture may have affected the views of professional service firms. Many office districts in Texas are also located in less dense suburban areas that are deemed less contagion-prone than urban cores.

“In Texas, there’s a little more risk and less concern about the virus,” says Stephen LaMure, CEO of Dominus Commercial, a Dallas commercial real estate firm, adding that most tenants in the buildings it handles have returned to the office.

Lisa Hall, CEO of Bene-Marc, a Fort Worth-based insurance firm for sporting events, says she asked her eight employees to come back to the office April 18 after they told her they were comfortable doing so.

A big factor, she says, was “the availability of vaccinations and the ability of anyone that wants to get one” to be inoculated. Also, Hall notes, Texas Gov. Greg Abbott lifted the state’s mask mandate and all capacity limits early last month and COVID-19 cases have been falling.

She says she wanted employees to come back to the office so she could assess their work load and productivity to determine if she needs to hire more workers now that revenue is gradually rising after plunging 80% early in the pandemic.

In Houston, when Masroor Fatany, opened a The Halal Guys franchise in a downtown office district in late January, one or two tables were typically occupied for lunch in the 40-seat eatery. But he has seen a gradual increase in the area’s office workers. Most tables are now filled and sometimes there are lines to order the restaurant’s gyros, falafels and other dishes, he says.

Although the rebound still has a long way to go, “We have turned the corner,” Fatany says.

San Francisco, New York City lag

At the other end of the spectrum, San Francisco and San Jose are at 14.2% and 17.4% of pre-crisis office visits, in part because they’re high-tech hubs where companies and their workers were used to telecommuting even before the health crisis, Ein says.

Other industries are more inclined to return to the office swiftly. Office occupancy among law firms in the 10 cities it tracks is at 39.3%, Kastle data shows. The companies tend to be less tech savvy, they’re more reliant on paper documents, and they have more rigid policies, Ein says.

New York City also lags, at 15.8% of pre-pandemic office visits, in part because it was hit hard by COVID-19 early in the pandemic and has been cautious about reopening, Ein says.

Copyright 2021, USATODAY.com, USA TODAY

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NAR, Economists, See Bright Path for Commercial RE

Economists predicted commercial real estate’s future at NAR meeting. The office market still has a wild card, but they’re generally bullish about the overall industry.

WASHINGTON – The U.S. economy experienced one of the swiftest declines in history last year, followed by a quick and relatively significant recovery in the second quarter of 2020.

Speakers at the National Association of Realtors® (NAR) Commercial Economic Issues and Trends Forum, part of the 2021 Realtors® Legislative Meetings & Trade Expo, discussed those historic economic shifts while projecting a favorable outlook for the commercial real estate market in the coming year.

Lawrence Yun, NAR chief economist, predicts that considerable capital will be pumped into the economy in 2021’s second quarter, with consumers eager to tap into a year’s worth of savings and unspent stimulus funds.

“Economic expansion and the jobs recovery will lead to rises in occupancy across all commercial real estate property types,” Yun says. “However, overall consumer price inflation is expected to increase 3% by the end of 2021 and likely will stay stubbornly high through next year, which will increase interest rates to 3.5%.”

Hotels, restaurants, theaters and other entities across the entertainment and hospitality industries are expected to benefit from pent-up demand as many cities have eased or altogether ended pandemic-induced restrictions.

While housing helped prop up the economy over the last year, apartments and rental markets have stumbled in the midst of the pandemic. Yun, however, expects them to regain footing as the broader national economy – particularly in urban areas – continues to recover.

“The apartment sector underwent sudden swings in occupancy – down abruptly in the early months of the pandemic and then sharply rebounding in recent months – but we expect vacancy to drop and rents to rise,” Yun says.

Office rents have also declined over the past four quarters, and it is unclear if new leasing of office spaces will take place, even as more workers return to physical work locations. Yun predicts that office vacancies will remain elevated at 16.5% in 2022, while retail vacancies are projected to settle at 11.5%.

“The industrial sector has been the star throughout the pandemic,” Yun adds. “There’s been great demand for industrial space, and reconversion of some disused properties like older shopping malls can help meet this demand.”

On the whole, the pandemic is leading to sweeping changes in the commercial real estate sector, including modifications to vacant hotels/motels. NAR recently released Case Studies on Repurposing Vacant Hotels/Motels into Multifamily Housing, a report that demonstrates the feasibility of such conversions. Often, those adaptations require public funding, such as the Low-Income Housing Tax Credit, the Historic Tax Credit or tax abatement.

John D. Worth, executive vice president for research and investor outreach at the National Association of Real Estate Investment Trusts (NAREIT), also spoke at the forum and provided a positive forecast for commercial real estate’s future.

“Work from home is the most important question facing the future of commercial real estate coming out of COVID-19,” he says. It’s too early to tell what percentage of workers currently at home will eventually return to offices.

Worth noted that commercial valuations are recovering, but that those improvements are occurring unevenly across various property types, with high returns over the COVID-19 period in REIT funds invested in digital real estate, such as cell towers, data centers and logistics facilities, as well as single-family homes, self-storage and timber.

Share prices are being driven by the strong demand for housing, the surge in e-commerce and the rising price of lumber.

“We’re going to go through a period where companies will experiment with how they use office space, but I’m bullish about the outcome of the office space sector after a period of experimentation,” Worth says.

Both Yun and Worth agree that office vacancy rates will remain elevated compared to pre-pandemic levels as hybrid work models become the norm in America.

© 2021 Florida Realtors®

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FHFA May Create New Lending Rules for ‘Condotels’

If a development has a large number of short-term rentals – individually owned units or single-family homes rented out similar to a hotel’s operations (condotel) – what unique lending standards for home sales should apply? FHFA opened a comment period that runs through July 5.

WASHINGTON – The Federal Housing Finance Administration (FHFA) is questioning whether lending standards should be changed for homes destined to be used exclusively as short-term rentals.

The issue impacts loans that Fannie Mae or Freddie Mac (the Enterprises) will eventually buy from lenders. A bank or other lender can make a loan to anyone they wish, but if they hope to keep making loans, they often plan to sell the loan to Fannie or Freddie and use the cash to make even more loans. They’re assured of a Fannie or Freddie purchase at the time of origination, providing they follow the rules established by FHFA for those loans.

FHFA is now looking at those rules as they apply to short-term rental developments.

“There are several attributes of short-term rentals that can increase liability risk, such that the standard unit owner’s insurance policy may be inadequate, resulting in losses that are uninsured, underinsured or improperly insured,” FHFA writes in its request for comments. “Condotels and other transient or resort type projects located in areas with higher exposure to natural disasters increase exposure to inadequate hazard insurance, flood insurance, special assessments and concentration risk. These factors can lead to increased default risk due to loss of rental income both at the project and unit levels.”

FHFA says that Fannie and Freddie’s loan policies for short-term rental projects are similar, but there are some differences. It’s seeking input for various reasons, including whether “these differences might contribute to industry confusion or processing inefficiencies.”

The request for information (RFI) is posted online and includes instructions for responding, including a list of 11 specific questions about any potential changes to short-term rental mortgage loans.

© 2021 Florida Realtors®

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In Mortgage Forbearance? Here’s What You Need to Know

FORT LAUDERDALE, Fla. – Mortgage servicers took their sweet time last spring advising customers affected by the pandemic about their right to hit the pause button on making payments with no documentation required, and no penalty charged to get back on track.

Now that most of those borrowers are preparing to resume making payments, mortgage servicers are again facing criticism for not being straight with their customers about their options for resuming payments when their forbearance period ends.

And that’s potentially troublesome for South Florida and Central Florida, where rates of mortgage borrowers allowed to skip payments through a process called forbearance exceed state and national averages, and are disproportionately high among Black and Hispanic homeowners in low-income neighborhoods.

Because those borrowers typically have less equity to work with, consumer advocates say they will need to take the initiative to work out a payment resumption plan with their mortgage servicers – which include traditional banks and payment processors that aren’t banks. If they’re not satisfied with the answers they get, help is available from volunteer legal aid organizations and federally funded housing counselors.

“This is often very complicated stuff,” said Mike McArdle, assistant director of mortgage markets for the Consumer Financial Protection Bureau (CFPB). “What is a deferral? What is a modification? What are term extensions? It’s important for borrowers to understand what is going on with their loans.”

Kim Henderson, president and CEO of Neighborhood Housing Services of South Florida, one of the area’s federally certified housing counseling providers with offices in Miami and Fort Lauderdale, said her organization hasn’t see an uptick in requests for help yet – probably because the Biden administration extended the forbearance period through Sept. 30 and the foreclosure moratorium through June 30.

“It’s coming, but not yet,” Henderson said. “We’re preparing. It’s one of those things that people won’t worry about until it hits them in the face that the party’s over.” When that happens, she says, her organization and numerous others will be ready to help, she said.

Complaints about mortgage servicers increasing

In a report released this week, the Consumer Financial Protection Bureau said in March it received the largest number of consumer complaints about mortgages since April 2018. Complaints mentioning forbearance or related terms reached their highest monthly average since March and April of 2020, when consumers seeking forbearance protection made available for borrowers of federally backed loans first began complaining about getting inaccurate information from their mortgage servicers. The report did not identify subjects of the most recent complaints.

Andrea Bopp Stark, an attorney at the nonprofit National Consumer Law Center, says some mortgage servicers are again providing confusing and contradictory information about borrowers’ options for resuming payments on federally backed loans. Some servicers of private market loans not subject to federal requirements are requiring borrowers to pay back missed payments in a lump sum or make monthly payments over a couple of years, she said.

While bound by the foreclosure moratorium, private-market lenders are not required to provide any affordable post-forbearance options, Stark said. She’s aware of one consumer who had to borrow $30,000 to get current and another who had to dip into his retirement account.

Meanwhile, some servicers of Federal Housing Administration (FHA) loans aren’t properly offering to defer missed payments to the end of the loans or offering modifications that could lower borrowers’ monthly payments if they can’t afford to pay the pre-pandemic amount, she said.

The opportunity for the roughly 70% of borrowers with federally backed loans to suspend mortgage payments for up to a year was part of the first pandemic relief act passed by Congress and the president last March. In February, it was extended through September by the entities that control the loans, including Fannie Mae, Freddie Mac, the Department of Agriculture, the Federal Housing Administration and the Department of Housing and Urban Development.

During the national shutdown last spring, financially devastated Americans took advantage of the unprecedented opportunity. An estimated 6.5 million home loan borrowers have missed at least one payment since March, according to the Mortgage Bankers Association. By July, about 8.5% of U.S. borrowers were in forbearance programs.

More borrowers behind on payments in Central and South Florida

In South Florida and Central Florida, however, the percentage of homeowners in forbearance programs far exceeded the national rate.

Here, rates peaked in June, according to data collected by Black Knight, a Jacksonville-based financial data provider. Rates peaked in South Florida at 18.9% in Broward County, 22.1% in Miami-Dade County and 15.3% in Palm Beach County. In Central Florida, rates peaked at 20% in Osceola County, 15.1% in Orange County, 10.1% in Seminole County and 11.5% in Lake County.

The highest percentages of homeowners in forbearance were in ZIP codes with large numbers of Black and Hispanic borrowers. In Broward County’s 33068 zip code, which includes parts of North Lauderdale, Tamarac and Margate, 24.5% of borrowers were in forbearance in June while another 5.6% not in forbearance were more than 30 days past due on their payments. The ZIP code is 86.5% Hispanic and/or non-white and 62.9% low- to moderate income.

In Osceola County’s 34758 ZIP code near Kissimmee, the forbearance rate reached 23.8% in June. The ZIP code is 85.3% Hispanic and/or non-white and 57.6% low- to moderate income. Another 4.6% not in forbearance programs were more than 30 days past due.

Forbearance and delinquency rates have gradually fallen since the economy began to reopen last summer. By January, the most recent month for which data was available, 5.6% of borrowers in the U.S. were still behind on their payments. In Florida, the rate was 6.9%. But rates remained comparatively high in the tri-county metro area at 9.1% and 7.4% in the Orlando region, according to CoreLogic, a consumer information service based in Irvine, California.

Consumer protection bureau is watching

Federal authorities said they plan to look closely at how mortgage servicers manage their communications with borrowers with limited English proficiency.

In March, consumers reported experiencing communications issues about their forbearance plans and options available at the end of the forbearance periods, the report said. Some reported long delays in getting loan modifications to help them lower their monthly payments.

The bureau released its report about a month after issuing a bulletin warning mortgage servicers “to begin taking appropriate steps now to avoid a wave of avoidable foreclosures once borrowers begin exiting COVID-19 forbearance plans later this fall.” Mortgage servicers, the bulletin said, are expected to prepare for the anticipated increase in loans exiting forbearance programs as well as applications for relief from borrowers who are delinquent but not in a forbearance program.

It warned that the bureau would closely monitor mortgage servicers’ compliance with requirements to contact borrowers before their forbearance periods expire to give them time to apply for help, work with them to make sure they have all necessary documentation to obtain help, promptly respond to inquiries, and evaluate income fairly.

Also, the bureau said it will look carefully at how mortgage servicers manage communications with borrowers with limited English proficiency.

Options for borrowers of federally backed loans

About 70% of all borrowers have home loans backed by one of the federal entities. Those borrowers must be given a series of options appropriate to their financial situation. While details may differ depending on which entity backs the loan, borrowers generally will be asked if they can step up to one of these options:

Stark said borrowers planning to exit forbearance, as well as those not in forbearance who have missed payments, need to take the initiative now – before the federal foreclosure moratorium expires on June 30 – to contact their mortgage servicers and inquire about their options.

With more than 2 million borrowers still in forbearance and planning to exit, mortgage servicers probably aren’t purposely spreading bad information, Stark said. “I think they’re bombarded and overwhelmed with the amount of forbearance and post-forbearance options. There are probably hundreds of thousands coming off forbearance every week.”

Borrowers who are among the 30% whose loans are privately backed and not federally backed should seek help from a housing counselor certified by the U.S. Department of Housing and Urban Development, a local legal aid department, or a private attorney if their servicer refuses to respond or provide affordable options, she said.

Henderson, of Neighborhood Housing Services of South Florida, said she expects further federal help to be announced to help delinquent borrowers avoid foreclosure. If none materializes, “then it boils down to good old fashioned self-advocacy and negotiation,” she said.

But borrowers won’t have to go it alone. “We can be a third party. Borrowers can sign a paper to give us the ability to speak on their behalf. We can be on the phone when they call their servicer. We can negotiate for them, or with them, and help walk them through their options.”

Where to find help

©2021 South Florida Sun-Sentinel. Visit sun-sentinel.com. Distributed by Tribune Content Agency, LLC.

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Experts: COVID-19 Sufferers Can Develop Psychotic Symptoms

NEW YORK – If you or someone you know may be struggling with suicidal thoughts, you can call the U.S. National Suicide Prevention Lifeline at 800-273-TALK (8255) any time day or night or chat online.

Ben Price always was the biggest presence in any room. Loud and funny, his smile was captivating, said his wife, Jennifer.

The couple owned a small business and two farms in an Illinois suburb west of Chicago, where they lived with their two teenage children. She said her husband was the hardest-working man she had ever met.

“He was the epitome of unconditional love and loved his kids with all his heart,” she said.

Price tells herself it wasn’t her husband who died by suicide on one of their farms the morning of Feb. 28. She said she believes he was taken over by what some health care professionals call “COVID psychosis.” The thought keeps the grief from swallowing her whole.

“It was shocking and devastating and so completely out of his character,” she said.

Neurological and psychiatric experts see more reports of COVID-19 sufferers developing psychotic symptoms, even when they have no history of mental illness. Though rare, the condition can be severe enough to require hospitalization.

Symptoms may include hallucinations, unusual agitation, restlessness, preoccupation, paranoid beliefs, decreased need for sleep and impulsive behavior, said Jonathan Alpert, a professor of psychiatry, neuroscience and pediatrics at Montefiore Medical Center and Albert Einstein College of Medicine in New York City.

Alpert did not treat Ben Price, who was never officially diagnosed with a COVID-19-related neurological condition before his death. But he recognizes the signs and urges people to seek immediate medical attention if they think someone is beginning to show symptoms of COVID-19 psychosis.

“When people are psychotic, they aren’t in touch with reality and may do things that harm themselves and other things that are very dangerous,” he said. “It looks like COVID-19 has a somewhat higher risk of causing it than other viral infections that we’ve seen.”

Price, 48, came down with COVID-19 two weeks before his death. When his oxygen levels were low, he was taken to a hospital and received treatments including steroids, antiviral medication and an antibody infusion, his wife said.

The COVID-19 unit was anxiety-inducing, Jennifer Price said, but her husband didn’t show signs of psychosis until he was home from the hospital. His anxiousness and paranoia skyrocketed, she said, and he became obsessed with working on the farm even though in February, there was no work to be done. He went from being boisterous and animated to subdued and “child-like.” After days of trying alone to help him, Price took him to a primary care doctor who prescribed him anxiety medication.

“It just wasn’t working. He was pacing and upset and worried,” Price said. “I was watching my daughter watch him and being worried … she saw it was not her dad.”

Although data is scarce, experts said “COVID psychosis” may be caused by brain inflammation triggered by the body’s immune response to the virus, Alpert said. Other contributing factors may include the side effects of high-dose steroids, low oxygen levels or the emotional trauma of being severely ill. Some COVID-19 patients suffer from small strokes that could lead to psychiatric disorders, he said.

A first episode of psychosis normally occurs in late adolescence or early adulthood, Alpert said. However, a study he co-wrote in November featured a 49-year-old man and 34-year-old woman who had COVID-19 and no history of mental illness.

After going public with her story, Price said she’s heard from dozens of families who fear their loved ones were or are suffering from the same condition.

“You can’t imagine the stories, the devastation and the things that people are doing out of character – thriving, wonderful people with zero prior (mental health) history,” she said. “It’s happening more than we realize.”

A study involving more than 230,000 COVID-19 survivors, which was published April 6 in The Lancet Psychiatry, found .4%, or nearly 1,000, had developed a psychotic disorder.

“There’s probably over 50-plus individual case reports where people are describing very specific instances of psychosis in the setting of someone having COVID-19,” said Colin Smith, a resident physician in internal medicine-psychiatry at Duke Medical Center, who co-wrote a case report studying COVID-19 psychosis.

Patients with temporary or permanent psychosis are at an increased risk of suicidality, said Mason Chacko, clinical assistant professor of psychiatry at Stony Brook University Hospital, who wrote a case report that detailed a patient who developed COVID-19-associated psychosis and died by suicide.

“Depression psychosis, being internally preoccupied or hearing voices or thoughts of self-harm could be triggers as well,” he said.

If she had known about COVID-19-induced psychosis, Jennifer Price said, she would have been better prepared to help her husband. That’s why she’s petitioning for the Biden administration to add a neurology expert to the White House Coronavirus Task Force.

Alpert agrees more focus should be placed on the possible mental health and neurological outcomes of COVID-19.

“Society itself, whether people have COVID or not, are experiencing significant mental health impacts,” he said. “Any COVID task force that doesn’t have mental health or neurological expertise on it is not really a full task force.”

The medical community is just learning about the possible psychotic manifestations associated with COVID-19 recovery, Alpert said, which is why it’s important for doctors to screen for psychiatric distress.

Price has been successful in her own state, convincing Illinois Gov. J.B. Pritzker to add neurology experts to the Illinois COVID Task Force. She’s been in touch with Eduardo Cisneros, intergovernmental affairs director for the COVID-19 Response Team at the White House.

She hopes a mental health question can be added to the Centers for Disease Control and Prevention’s V-safe survey, a smartphone-based tool that uses text messaging to provide personalized health check-ins after people receive a COVID-19 vaccine.

“Sharing my story is one thing, but really, what is important is action,” Price said. “My Ben has his hand on my back, and he’s with me every step of the way.”

For pandemic-specific mental health resources, head to covidmentalhealthsupport.org.

Copyright 2021, USATODAY.com, USA TODAY. Health and patient safety coverage at USA TODAY is made possible in part by a grant from the Masimo Foundation for Ethics, Innovation and Competition in Healthcare. The Masimo Foundation does not provide editorial input.

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Fla. Crowdfunding Firm Pleads Guilty to Fraud

The newest type of real estate investing still carries risk: A Jacksonville crowdfunding firm owner pleaded guilty to mail fraud when some projects didn’t fully fund.

JACKSONVILLE, Fla. – Crowdfunding has become a popular real estate tool that connects individual investors directly to specific projects, but like any other commercial venture, it carries a risk of fraud.

In a recent Jacksonville case, the owner of a company that oversees crowdfunding – a middle man that accepts investor money to be used toward a specific project – failed to return that money after it didn’t reach the total amount needed to proceed with the project.

According to the U.S. Attorney’s Office for the Middle District of Florida, Daniel Summers of St. Augustine pleaded guilty to mail fraud and now faces a maximum penalty of 20 years in federal prison. A sentencing date has not been set, and the United States is seeking forfeiture in the amount of $744,910 – the proceeds Summers obtained as a result of the fraud. The amount of restitution due to victims will be determined later.

According to court documents, Summers owned a Jacksonville-based company called Realty E Vest, which also did business as IHT Realty Group, an internet crowdfunding investment platform for real estate development projects. Summers also owned E Vest Technology, which sought to develop and license the Realty E Vest crowdfunding platform to other companies that also wanted to manage crowdfunding efforts.

Under that business model, individual invested in projects by wiring funds to Realty E Vest, where the funds were supposed to be held in escrow until the project met its crowdfunding goal. If a project failed to meet its goal, Summers promised to return the investors’ funds.

However, after several Realty E Vest crowdfunding projects failed to fully fund, Summers intentionally kept investors’ money and misappropriated it to fund the ongoing operations of his companies, including paying employee salaries.

Summers then acted as if the failed projects were fully funded, giving “victims the illusion that they had successfully invested in these projects,” according to the court. He paid investors “investment returns” for the failed projects via mailed checks or wire transfers. He also repaid some victims’ investments if they complained after discovering their crowdfunding projects failed to fund.

However, the money to pay these people wasn’t from the real estate developers or any legitimate investment activity; instead, it came out of victims’ principal investments in other crowdfunding ventures and equity investments that Summers solicited in E Vest Technology.

This case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney David B. Mesrobian.

© 2021 Florida Realtors®

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Buyers Want a Custom Home? It May Take 18 Months

There are pros and cons to buying a new vs. existing home, but it’s taking a longer time to complete a new one – about four months more than it did two years ago.

ORLANDO, Fla. – Rising costs, material shortages and a labor deficit have hit the homebuilding industry hard, and buyers looking for a custom home builder in Orlando, for example, may have to wait longer than usual.

Custom home builders are not immune to the problems facing the construction industry, and these issues are increasing costs and dragging out construction timelines, says Rial Jones, founder and president of Clayton Jones Construction Inc.

“We can’t do as much as we did a year or two ago, just because everything takes much longer, Jones says. “A typical house that may have taken 12 or 14 months might be a 16- or 18-month project in today’s world.”

Costs for materials are up “across the board,” including roofing tiles and electrical wire, Jones adds. A shortage of construction labor means Clayton Jones faces as much as a 30% to 40% spike in labor costs. It also takes longer to deliver materials, which is why the firm orders 12 weeks ahead.

Custom homes also often include more individualized facets that take longer to ship or import.

Source: Orlando Business Journal (04/29/21) Soderstrom, Alex

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The Nation’s Realtor Members Become More Diverse

In 2001, 10% of Realtors were nonwhite; in 2020, that number rose to 24%, according to a study on career choice released by NAR. However, whites had the highest median number of transactions (7) compared to Blacks and Asians (2), Hispanics (3) and LGBTQ+ members (5).

WASHINGTON – In 2001, just 10% of Realtors® were nonwhite, but that grew to 24% by 2020, which better reflects the demographic makeup of the country.

Jessica Lautz, vice president of demographics and behavioral insights at the National Association of Realtors® (NAR), presented top-line findings from the 2021 NAR study Career Choice in Real Estate: Through the Lens of Race, Gender, and Sexual Orientation on Wednesday at a meeting of the Diversity Committee held during the virtual 2021 Realtors Legislative Meetings.

The report included responses from some 18,000 NAR members and provided some understanding of the differences in why members entered the profession. It asked about the skills that are important in the real estate field, the areas in which members worked, and those members’ typical number of transactions, sales volume and income differences.

Lautz noted that the study, an expansion of member research from 2017, was an important step in furthering NAR’s goals to support diversity, equity and inclusion within its membership, in addition to similar objectives in support of fair housing and expanded housing opportunities for all.

Study findings

  • The most common reasons members cited for entering real estate: Flexible work hours, an interest in helping families, working with people, and a love of homes and homeownership.
  • Median years of experience: White members reported the lengthiest tenure, with 10 years, compared to five years for Asians and four years for both Black and Hispanic respondents.
  • Whites had the highest median number of transactions, seven, compared to two for Blacks and Asians, and three for Hispanics. LGBTQ+ respondents reported a median of five transactions.
  • The highest median annual sales volume was reported by white respondents at $1.988 million, with Black members indicating the lowest at $474,500.
  • Gross personal income from real estate in 2020 was highest for white respondents at $49,400 and lowest for Blacks at $16,700.
  • As far as ownership interest in their firms, Asian members had the highest percentage of any group, with 36%, while LGBTQ+ had the lowest at 24%.

Source: National Association of Realtors® (NAR)

© 2021 Florida Realtors®

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Owner Tests Appraisers, Finds Higher Value if White

After two appraisals, a Black owner removed ethnic art, asked a white male to act as her rep, and added $100K to her appraisal. “Comps” choices may have played a role.

INDIANAPOLIS – A Black Indianapolis homeowner has filed a housing discrimination complaint alleging that after she removed items that identified her race and asked a white male friend to sit in on an appraisal, the value of her home jumped more than $100,000.

Carlette Duffy filed the complaint in conjunction with the Fair Housing Center of Central Indiana (FHCCI). Last year, Duffy decided to jump in on the hot housing market and refinance her home, located in a historically Black neighborhood just outside downtown Indianapolis. Duffy planned to use her equity to purchase her grandparents’ home nearby.

After two home appraisals came back at or below the price she paid for the home in 2017, Duffy thought something was wrong.

“When I challenged it, it came back that the appraiser said they’re not changing it,” Duffy said.

After Duffy saw FHCCI Executive Director Amy Nelson speak to a community group about discrimination in housing appraisals, during which she pointed to a recent New York Times article about the issue, she decided to try her own test.

“I decided to do exactly what was done in the article,” Duffy said. “I took down every photo of my family from my house. I took every piece of ethnic artwork out. So any African artwork, I took it out. I displayed my degrees, I removed certain books.”

Duffy asked a white male friend to sit in on the home appraisal. In addition, she did not declare her race in her application or communications with the appraisal company. The new appraisal came back at more than double the first two, valuing her home more than $100,000 higher.

“I get choked up even thinking about it now because I was so excited and so happy, and then I was so angry that I had to go through all of that just to be treated fairly,” Duffy said.

In the two complaints, Duffy and FHCCI ask the U.S. Department of Housing and Urban Development to investigate the difference in the appraisals. In the first two appraisals, Nelson said comparable sales, or comps, were pulled from Black neighborhoods more than a mile from Duffy’s home rather than those nearby that were closer to the specifics of her house.

“Whether or not those comps were fairly selected is something that is the basis of the complaints that we have filed,” Nelson said.

Duffy was able to use the third appraisal to purchase her grandparents’ home. She hoped that her case would serve as a catalyst to examine discrimination and bias in the appraisal and housing industry to ensure a fair process.

“I’m doing this for my daughter and I’m doing this for my granddaughter so that when they come against obstacles, they will know that you can stand up, you can say that this is not right,” Duffy said.

“We think it’s happening a lot more than is being reported and we want to get the word out to know that we are here as a resource for individuals if they feel this may be happening to them,” Nelson said.

WXIN reached out to the appraisers and mortgage companies named in the complaints and did not receive any comment, though one appraiser did say by phone that he had not been made aware of the complaint.

Rodman Schley, president of The Appraisal Institute, which represents appraisers across the country, sent a statement, saying in part, “When we see even one story of a consumer who feels they were treated differently because of their race, it’s very concerning because that goes against everything we stand for. Appraisers take a lot of pride in being an objective source of real estate value information.”

He said a project team will be reviewing reports of “diversity, equity and inclusion in appraisal.” He added, however, that an appraisal is only “one piece of a larger ecosystem to look at when it comes to housing issues.”

“We don’t think there is any one solution to a problem rooted in hundreds of years of history,” he said. “We believe that overwhelmingly, there are more good people in this world than bad, including in the appraisal profession, and that today, more than ever, people are committed to listening, learning and changing. That said, it is widely accepted that unconscious bias is real, and no profession is immune from that.”

Schley encouraged anyone who thinks they have experienced housing discrimination to report it.

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The Real Estate Market Isn’t in a Bubble – It Just Isn’t

Rising home prices and recession memories have convinced some buyers that a bubble will pop and prices will drop. But it’s just too much demand and too little supply.

NEW YORK – The U.S. housing market is on a hot streak with double-digit annual gains in home prices, bidding wars and surging buyer demand. That type of soaring housing market is prompting more “bubble” fears in some corners, but economists say the housing market isn’t getting overinflated. A bubble won’t pop, thousands of homes won’t slide into foreclosure, and buyers who wait likely won’t be better off.

“We have strong conviction that we are not experiencing a bubble in U.S. housing,” Vishwanath Tirupattur, a Morgan Stanley strategist, wrote in a note to clients this week.

Lawrence Yun, chief economist of the National Association of Realtors®, agrees. He told Axios last month: “This is not a bubble. It is simply lack of supply.”

The rapid rise in prices may be concerning to home shoppers, however. The median selling price for a home is up $35,000 compared to a year ago, which is the fastest-paced increase since 2006, Tirupattur says.

But this isn’t 2006. Housing inventories are low, credit remains tight, and lenders aren’t issuing risky loans like they did back then. Product risk – such as from mortgages with introductory periods, teaser rates or balloon payments – comprised about 40% of the mortgage market between 2004 to 2006. Those factors are now at only 2% of the mortgage market, according to Morgan Stanley.

Also, the housing market has a record low number of homes available for sale, in part likely caused by the pandemic. At the end of March, there were 1.07 million homes available for sale, according to NAR data. For comparison, during the housing bubble, in July 2007, there were more than four times that – 4 million homes available for sale.

Still, while home prices won’t keep climbing at the current pace, they aren’t expected to fall either, economists say.

“We are not at all suggesting that home price appreciation will maintain its current torrid pace,” Tirupattur writes. “Home prices will continue to rise, but more gradually.”

Source: “Why Morgan Stanley Is Convinced the Housing Market Isn’t in a Bubble,” Yahoo! Finance (May 5, 2021) and “The Dispiriting Housing Boom,” Axios (April 11, 2021)

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Fla. Takes First Step to Launch Rental Assistance Program

DCF, the Fla. department charged with distributing $850M of federal funds to assist with rental assistance, introduced a dedicated website to get funds to landlords and utility companies. Applications should be available soon, and payments can be direct-deposited into business accounts.

ORLANDO, Fla. – Florida’s Department of Children and Families (DCF) took its first step to get $850 million in federal recovery funds into the hands of landlords and utility companies.

In a Thursday webinar, DCF announced the debut of a new website – OURFlorida.com (Opportunity for Utilities and Rental Assistance) – that will operate as a central hub for questions, auxiliary help and submitting relief applications, which are not available yet.

The website still has a number of “coming soon” options, but it does have a list of frequently asked questions (FAQs).

When will the website start to accept landlord applications for rental reimbursement? Officials did not offer a date, but Michael Williams, director of special projects for DCF, said in response to a question that they might be available within a week.

Notable items from DCF’s announcement

  • Landlords can receive funding as a direct deposit into their bank account – it won’t go through tenants.
  • Landlords can apply for lost-rent reimbursement only for time periods in which they did not receive county assistance – the two cannot overlap. However, if a lost rental period lasts for six months and they received county assistance for three months, they can apply for the three months not covered by the county.
  • Landlords apply through the OURFlorida.com website to receive funds.
  • OURFlorida.com visitors can sign up for an e-newsletter to get funding updates.

DCF asked webinar participants to promote the new website and upcoming application process – to “spread the word.” The website will include a toolkit (coming soon) with items that can be shared on social media and used in other ways.

© 2021 Florida Realtors®

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Regulators Scale Back Citizens Rate Hikes

A 3.2% increase for multi-peril policies was approved instead of a requested 6.2% hike; a request to charge actuarially sound rates for new customers was also rejected.

TALLAHASSEE, Fla. – Regulators have scaled back rate increases sought by Citizens Property Insurance Corp., dealing a blow to leaders of the state-backed insurer who argue it needs to charge more for coverage.

The Florida Office of Insurance Regulation released details Tuesday of rate increases that will take effect Aug. 1, including decisions that reduced amounts sought by Citizens.

As an example, Citizens requested an average 6.2% increase for homeowners’ multi-peril policies – the most common type of policies – but regulators approved a 3.2% increase.

Regulators also rejected a series of moves that Citizens proposed to boost rates. Perhaps the most far-reaching decision involved a proposal by Citizens to charge actuarially sound rates for new customers – a move that would have effectively led to many new customers paying more than current customers.

State law limits rate increases for existing customers to a maximum of 10% a year. Citizens officials contend that limit, dubbed a “glide path,” has led to many customers paying less for coverage than they should.

“Citizens’ recommended rates include a provision requiring that new business policyholders be charged the actuarially indicated rates, while renewing policyholders would be subject to the 10% statutory glide path. … The office finds the justification for this provision to be insufficient and that all policies, whether new or renewal, should be subject to the same capping,” an order signed by Insurance Commissioner David Altmaier said.

Similarly, the order rejected a proposal by Citizens to include what is described as a “risk factor” in its rates, which would have helped lead to larger increases.

“Citizens’ recommended rates include a provision described in the rate filings as an estimate of the amount extra Citizens should charge for the cost of catastrophic risk that Citizens is assuming,” the order said. “The office finds the justification for the provision to be insufficient and that it should be removed from the rate determination.”

The office released the details amid a legislative debate about proposals to make changes in the state’s property insurance system, as the industry says carriers are sustaining financial losses. Private insurers during the past year have filed dozens of requests for large rate increases and have shed policies.

Many of those policies have ended up at Citizens, which was created as an insurer of last resort. As an indication of the growth, Citizens had 569,868 policies as of March 31, up from 446,327 policies a year earlier.

The growth has alarmed Citizens leaders and many lawmakers, at least in part because of concerns about financial risks if the state gets hit by a major hurricane or multiple hurricanes.

Citizens staff members initially proposed an average 3.7% increase in residential rates to take effect in August, but the Citizens Board of Governors in December requested that staff seek ways to increase rates more. That led to a series of changes proposed to the Office of Insurance Regulation, which has to sign off on any increases.

The office’s decisions will lead to varying increases for customers based on factors such as types and locations of homes or other structures. Along with approving an average 3.2% rate increase for homeowners’ multi-peril policies, regulators approved an average 5.1% hike for homeowners’ wind-only policies, down from a Citizens request for a 7% increase.

As another example, regulators approved an average 9% increase for mobile-home owners’ multi-peril policies, down from a Citizens request for a 9.3% hike.

News Service of Florida

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By the Numbers: COVID-19 Vaccinations in Florida

As of April 19, more than 8.14 million people in Florida had received at least one dose of COVID-19 vaccines. Of those, more than half (4.82M) are ages 55 to 84.

TALLAHASSEE, Fla. – As of April 19, more than 8.14 million people in Florida had received at least one dose of COVID-19 vaccines. Here is a breakdown by age groups:

*Ages 16 to 24: 395,449 people

*Ages 25 to 34: 612, 238 people

*Ages 35 to 44: 811,815 people

*Ages 45 to 54: 1,098,485 people

*Ages 55 to 64: 1,622,525 people

*Ages 65 to 74: 2,031,098 people

*Ages 75 to 84: 1,169,703 people

*Age 85 or older: 402,286 people

Source: Florida Department of Health

News Service of Florida

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U.S. Watchdog Cracks Down on Mortgage Servicers

Worried about foreclosures, the federal bureau is reviewing mortgage servicers’ compliance with pandemic relief programs and how they’re handling forbearance requests.

WASHINGTON – The Consumer Financial Protection Bureau (CFPB) is scrutinizing mortgage servicers’ compliance with pandemic relief programs amid concerns struggling homeowners are not getting the help they need to avoid foreclosures or are being discriminated against, according to sources.

The CFPB has sent data requests to mortgage servicers that process mortgage repayments and have asked for data on how they are handling mortgage holiday or “forbearance” programs and whether the temporary debt relief is likely to get borrowers back on their feet. The agency has opened probes into mortgage servicers over their handling of forbearance requests.

According to the six sources, the agency is examining a range of issues: how many and which borrowers are in forbearance; whether loan modifications will succeed in getting borrowers repaying; if servicers have been obstructing or delaying forbearance requests or granting only partial relief; and if some servicers have been discriminating against borrowers based on race or ethnicity, whether deliberately or inadvertently.

Reuters (04/19/21) Qing, Koh; Johnson, Katanga; Prentice, Chris

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5 Insights to Help You Start a Real Estate Business

Some of the steps to a real estate career may include: Write a business plan, get your license, create a strong brand identity and build your online presence.

NEW YORK – A real estate career, over the long-term, can be a lucrative small business. Let’s take a look at five steps you should take to start a real estate business:

1. Develop and refine your idea.

How do your natural strengths differentiate you from the other real estate businesses in the area?

Consider the following questions:

* What skills set me apart?
* What is the purpose of my business?
* Who am I providing a service or product to?
* What is the maximum figure I can safely spend on this real estate business?
* Do I need outside capital? How much
*What kind of work/life balance am I looking to achieve?
* What are my expectations for starting a real estate business?

Competition is hard enough – make it easier to stand out with a specialty when you start a real estate company.

Maybe you want to be the area expert in short sales, only focus on rental-property management, or perhaps you are the go-to resource for landlord/tenant laws for your state.

It’s important to find a niche. Choosing a niche will increase your chance of success.

2. Write a business plan.

A business plan defines your company’s objectives and then provides specific information that shows how your company will reach those goals.

Although a business plan isn’t mandatory, it can help you to crystallize your ideas. Keep your business plan short and concise and focus on the essential details. There are several great one-page business plan templates you can use.

3. Get a real estate license.

There are four necessary steps you need to complete to get your real estate license and start working as a realtor:

* Take the real estate pre-licensing course for your state. You’ll need to study the topics covered on the exam, including fair-housing laws, property-ownership types, fiduciary responsibilities, titles, deeds, contracts, and other necessary aspects of real estate law.

* Pass the real estate licensing exam. The exam length varies from about 1.5 hours to 3.5 hours, based on the state. In most states, you must answer 70% to 75% of the questions correctly to pass.

* Submit your license application to your state’s real estate board as soon as you pass your exam. Your state may require all real estate license applicants to submit their fingerprints for a criminal-background check.

* Find a real estate broker. Having your license associated with a licensed brokerage is required to start working as a real estate agent.

4. Create a strong brand identity.

Real estate agents and brokers often market their services on the strength of their brand and personality.

Crafting a memorable brand identity is a crucial element for any real estate professional.

Your brand identity represents how people know you and your business. It affects how customers perceive your reputation or the reputation of your company.

Ask yourself these essential questions:

* What identity/personality do I want my real estate brand to project?
* Who will want my products or services?
* What can clients get from my services that they can’t get anywhere else?
* What can clients get from working with me that they can’t get anywhere else?
* What are my brand values?
* What is the most critical part of my customers’ experience?

Your answers to these questions (and others like them) will build the core of your brand. All of your future branding and rebranding decisions should expand on these ideas. Your business name, logo, and website should all grow from the concepts you laid out here.

Far too many real estate companies have identical logos. Be sure your real estate logo is unique.

And don’t forget about real estate signage. Leave dull signs to others and instead, get real estate signs that sell.

Whenever you make personal appearances, be sure to carry business cards and brochures for people who want to learn more about your services.

Before you decide that you should delay building a strong brand identity for your real estate business because you might not have a considerable budget, rethink that plan. The truth is that you don’t have to spend thousands of dollars on building a strong brand identity.

5. Build an online presence.

Customers choose real estate services based on the brand, the real estate professional behind the brand, and that person’s reputation. Your website is often the first contact point between you and potential clients. Make that first impression a good one with a well-designed site.

According to a study on homebuyers, 90% start their search online, and 40% contact a real estate agent after researching the web.

You must be on the internet to compete in the real estate market. Ensure that your website design truly embodies your real estate brand. Visitors should understand who you are, the services you offer, and your qualifications and reputation.

Your real estate website design and marketing copy should project your personal or broker’s brand voice and identity. Here are some suggestions:

* If you work as a real estate agent, include a photo and bio. Homebuyers want to know the person behind the site.
* Be authentic and avoid marketing “happy talk.” Speak the same language as your customers.
* Include high-quality examples of sales you’ve closed, and make sure to include social proof wherever possible.
* Give site visitors an easy way to get in contact with you.

There’s a lot to think about when you’re starting your own real estate business, but with this guide, you have a proven step-by-step plan.

Ross Kimbarovsky is founder and CEO at crowdspring. He mentors entrepreneurs through TechStars and Founder Institute and has founded numerous other startups. Find the full guide: “How to Start a Real Estate Business: The Definitive Step-by-Step Guide.”

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Potential First-Time Home Buyer Program Seeks Equity in Housing

Called the Down Payment Toward Equity Act of 2021, the draft legislation is directed at creating equity in the housing market. Eligible home buyers must be the first generation in their family to own a home; first-time buyers could receive as much as $25K under this proposal.

WASHINGTON – The possibility of a first-time home buyer tax credit of up to $15,000 was part of President Biden’s campaign proposal to boost the participation of first-time buyers in the housing market. But the first indication of a new program for first-time buyers is the Down Payment Toward Equity Act of 2021, a draft of legislation published and discussed at a hearing of the House Financial Services Committee on April 14.

The proposed legislation, which differs in several ways from the initial concept of a first-time buyer tax credit, is both narrower and broader than the earlier plans. While the amount that could be available for first-time buyers is as high as $25,000 in this proposal, the program is directed at creating equity in the housing market. To do that, eligible home buyers must be the first generation in their family to own a home.

The National Council of State Housing Agencies (NCSHA) explains key elements of this plan:

Borrowers must be first-time home buyers, defined by the federal government as those who have not owned a home in the previous three years.

Borrowers must meet income limits of 120% or less of area-median income of the location where the buyers live or where the home is being purchased. In high-cost housing markets, the income limit is increased to 180% of area-median income. In the D.C. region, median family income is $123,100 in 2021.

Borrowers must be a first-generation home buyer, defined as any person whose parents or guardian never owned a home during the home buyer’s lifetime or lost the home to a foreclosure or short sale and do not own a home now. Anyone who lived in foster care also qualifies as a first-generation home buyer.

Minority first-time home buyers can get down payment help

Home buyer assistance is available up to $20,000 for eligible borrowers or up to $25,000 if the home buyer qualifies as a socially and economically disadvantaged individual. The economic disadvantage measure is met by income limits on the program.

According to the proposed bill, socially disadvantaged individuals are defined as those who have been subjected to racial or ethnic prejudice or cultural bias because of their identity as a member of a group without regard to their individual qualities. NCSHA’s summary says: Any individual identifying as Black, Hispanic, Asian American, Native American, or any combination thereof will be presumed to meet this definition.

Buyers can fund their purchase with any government-insured FHA or USDA loan or a loan that can be purchased by Freddie Mac or Fannie Mae.

Home buyer counseling is required to participate in the program.

The down payment assistance is a grant that does not need to be repaid if the buyers keep their home for five years. It must be repaid in full if the buyers stop occupying their home less than a year after they buy it. The amount that must be repaid decreases 20% each year they live in the home and is completely forgiven after five years in residence.

If the program passes into legislation, it would be administered by state housing finance agencies under the direction of the Department of Housing and Urban Development.

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Share of Mortgage Loans in Forbearance Down to 4.50%

Anxious buyers who hope some homes in forbearance would be soon listed for sale may be disappointed as more owners start making their mortgage payments again.

WASHINGTON, D.C. – As of April 11, the total number of loans in forbearance decreased by 16 basis points – from 4.66% of servicers’ portfolio volume in the prior week to 4.50%, according to the Mortgage Bankers Association’s (MBA) latest Forbearance and Call Volume Survey.

Forbearance provides an economic lifeline to homeowners impacted by the COVID-19 pandemic, allowing them to postpone their monthly mortgage payments while the nation waits to get past the pandemic and people return to their jobs. They have a number of repayment options, but the simplest one tacks all missed payments onto the end of their loan. When their forbearance period ends, they simply start making the monthly payments again and pick up where they left off.

With a number of homeowners in trouble and a foreclosure ban in effect, many buyers hope the end of the pandemic might also bring a stronger inventory of homes for sale. While that might be true for homeowners who postponed a sale until the pandemic ended, it’s not clear how many homes in forbearance will actually be added to inventory.

“The share of loans in forbearance decreased for the seventh straight week and has now dropped 40 basis points in the last two weeks,” says Mike Fratantoni, MBA’s senior vice president and chief economist. “The forbearance share decreased for all three investor categories, with the rate for portfolio and PLS loans (private-label securities) decreasing by 31 basis points this past week – the largest drop across investor categories.”

Still, Fratantoni says more than 36% of borrowers in forbearance extensions have now exceeded the 12-month mark.

“We expect that the forbearance numbers will continue to decline in the months ahead as more individuals regain employment,” Fratantoni adds. “Homeowners who are still facing hardships and need to extend their forbearance term should contact their servicers.”

Key MBA forbearance findings: April 5 to April 11, 2021

  • Total loans in forbearance decreased from 4.66% to 4.50%.
  • Ginnie Mae loans in forbearance decreased from 6.33% to 6.16%.
  • Fannie Mae and Freddie Mac loans decreased from 2.52% to 2.44%.
  • The share of other loans (e.g., portfolio and PLS loans) in forbearance decreased from 8.65% to 8.34%.
  • 13.1% of total loans in forbearance are in the initial forbearance plan stage, while 82.1% are in a forbearance extension. The remaining 4.8% are forbearance re-entries.

Of the cumulative forbearance exits from June 1, 2020, through April 11, 2021:

  • 26.7% resulted in a loan deferral/partial claim.
  • 25.6% were borrowers who continued to make monthly payments during their forbearance period.
  • 14.6% were borrowers who did not make all of the monthly payments and exited forbearance without a loss mitigation plan in place yet.
  • 14.5% were reinstatements, in which past-due amounts were paid back when exiting.
  • 9.5% resulted in a loan modification or trial loan modification.
  • 7.4% resulted in loans paid off through either a refinance or by selling the home.
  • The remaining 1.6% resulted in repayment plans, short sales, deed-in-lieus or other reasons.

© 2021 Florida Realtors®

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Delayed Closings: The Most Common Reasons in Feb.

Most homes complete the sale on time, but of those that are delayed, almost 1 in 3 (29%) have a financing issue, and 1 in 4 (23%) confront an appraisal issue.

CHICAGO – Most home sale contracts settle on time, but one in four (26%) faced delays in February, while 6% were terminated completely, according to the latest Realtors® Confidence Index. The following chart shows the most common issues sparking a delay to closing.

Of the 6% terminated completely, the most common problems were related to:

  • Appraisal issues: 11%
  • Obtaining financing: 10%
  • Home inspection/environmental issues: 9%

Of contracts that closed but faced delays, the most common problems cited were:

  • Issues related to financing: 29%
  • Appraisal issues: 23%
  • Title or deed issues: 13%
  • Home inspection or environmental issues: 12%
  • Something related to a contract contingency: 5%
  • Issues in buying/selling a distressed property: 2%
  • Insurance-related issues: home, hazard or flood: 2%
  • Buyers who lost their job: 2%
  • Other issues: 13%

Nevertheless, the housing market remains competitive. Respondents to the Realtors Confidence Index report an average of four offers for every house sold. Homes also typically sold within 20 days – a record low since May 2011, when the National Association of Realtors® (NAR) started collecting such information. A year ago, homes typically sold within 36 days.

Source: “Realtors® Confidence Index Survey, February 2021,” National Association of Realtors®

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Legislature Passes, Gov. Signs Biz Rent Tax Reduction

A multifaceted bill will net Fla. $1B from internet sales and eventually lower the business rent tax from 5.5% to 2% – a major Florida Realtors legislative priority.

TALLAHASSEE, Fla. – Gov. Ron DeSantis signed a taxation bill (SB 50) into law on Monday. While the new law covers a number of taxation issues, one element lowers the business rent tax, which was a major Florida Realtors® priority this year and in previous years.

The bill should raise about $1 billion by collecting taxes on all internet sales. While Florida buyers were already required to pay sales tax on these online purchases, it was rarely done. However, SB 50 makes sure online retailers collect and remit the required sales tax on purchases made by Floridians.

Initially, the additional revenue will replenish Florida’s Unemployment Compensation Trust Fund, which was depleted by the record unemployment caused by the pandemic. Once that’s replenished, however, the additional revenue will be used to reduce the business rent tax from 5.5% to 2%.

Florida currently charges a 5.5% sales tax on businesses that rent commercial space – the only state in the nation to levy this tax. Municipalities and local governments may levy taxes on top of the state sales tax rate, which means that some businesses are paying more than 8 percent in sales tax on their business rent.

The 2017, 2018 and 2019 Florida Legislatures had lowered the tax rate from 6 percent down to 5.5 percent.

Reducing the Business Rent Tax gives businesses the ability to expand, hire more employees, improve benefits and raise salaries.

© 2021 Florida Realtors®

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Fla. Courts Handle 3 out of 4 U.S. Property Insurance Lawsuits

Of U.S. lawsuits filed over property insurance payments in 2019, Fla. had 76%, according to a state report – but it only had 8% of all property insurance claims.

ORLANDO, Fla. – Nearly three-quarters of all U.S. lawsuits filed by homeowners against their property insurance companies were made in Florida, a new report says, as state lawmakers consider reforms to the system.

The report suggests that litigation is driving higher insurance costs in a state that has seen insurers raise homeowners’ rates by 30% or more.

In 2019, Florida homeowners accounted for 76% of such suits, according to the report by the Florida Office of Insurance Regulation (OIR). The study also found that state residents filed just 8% of all property insurance claims in the nation that year.

OIR Commissioner David Altmaier put the new statistics in a letter dated April 2 to Rep. Blaise Ingoglia, R-Spring Hill, chairman of the House Commerce Committee, a document meant to supplement a report OIR sent to the committee in February.

Using data from the National Association of Insurance Commissioners of which Altmaier is also president, the agency found Florida to be responsible for more than 60% of property insurance litigation nationally since at least 2016. The letter did not provide any information about previous years, and 2019 was the most recent data available.

The report in February identified “costly litigation” as one of the primary drivers for rising insurance premiums in the state. Last year, OIR approved rate hikes of more than 30% for some insurance companies. Companies only need to ask for approval if seeking to raise rates by more than 15%.

Altmaier’s letter also said Florida’s ratio of claims closed without payment to lawsuits opened was 27%, eight times higher than the next state, Connecticut, where the ratio was 3.4%. That means more Florida homeowners filed lawsuits after not receiving a payment for their claim than in any other state by a margin of eight to one.

The rise in litigation in Florida has led many private insurers to drop policies along the coasts and in Central Florida, where industry leaders say contractors and other agents have been directly soliciting roof damage claims from homeowners.

The issue has led to an explosion in policies for the state-run Citizens Property Insurance, a situation that led Citizens CEO Barry Gilway last year to call Florida’s insurance market “unhealthy.”

Altmaier’s letter concludes by suggesting solutions the Legislature may consider to bring down the number of cases. They include measures such as reducing attorneys’ fees to make lawsuits less attractive to lawyers and modifying laws to reduce the number of roof claims.

Some of these ideas appear in HB 305, introduced in January by Rep. Bob Rommel, R-Naples. The bill also seeks to stem practices by contractors and independent agents that experts say is causing the rise in roof claims.

But attorneys such as Mark Nation of Morgan & Morgan say that the measures in the bill will hurt homeowners by limiting access to the courts.

“You think there are a lot of denials now?” Nation said in a Sentinel interview last year. “Think about if people like me didn’t exist.”

In the House earlier this month, the bill went to the Commerce Committee, on which Rommel sits. A companion bill, SB 76, passed the Senate April 9.

© 2021 The Orlando Sentinel (Orlando, Fla.). Distributed by Tribune Content Agency, LLC.

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Cocktail Party Talking Points: Why Can’t I Find a House to Buy?

Florida Realtors economist: Cocktail parties – remember those? Once someone finds out you’re a Realtor, the conversation often turns to the current market. Here are suggested responses to a common question you’ll likely be asked at your next cocktail – or Zoom – party.

ORLANDO, Fla – Though it may be a distant memory, cocktail parties were once a staple of every professional’s social calendar. Since signs point to the return of these enjoyable networking opportunities very soon, dust off your fancy shoes and attire – you know, the stuff other than your yoga pants and slippers – and come up with a response to the question you will likely get asked as the best Realtor at the party.

Party guest question: Why can’t I find a house to buy? Seems really tough out there!

Your response: It’s the hold period, new construction and interest rates.

Hold period

According to the 2020 Profile of Home Buyers and Sellers from the National Association of Realtors® (NAR), the hold period of the home – the amount of time a buyer expects to stay in the home they just purchased – has been shifting in recent years. Today’s homeowners typically live in their homes for longer periods of time than in the past.

According to NAR’s study, in recent years, the typical hold period of a home in the U.S. – which historically has been six to seven years – expanded to 10 years and it remained at this historic high in 2020. In Florida, the median hold period is only slightly less (9 years).

With people holding onto their properties several years longer than they previously did, there is less “churn” in the market, meaning, there are fewer existing homes going onto the market. This has a significant impact on the amount of available inventory for first-time homebuyers.

At the national level, there are more real estate agents working in the U.S. housing market than the number of homes for sale. At the end of February 2021, the U.S. had 1.03 million homes for sale, down 29.5% from a year earlier and the lowest on record going back to 1982, according to NAR. In Florida, inventory across all property types was 73,434, down 47.2% year-over year.

New Construction

The obvious solution for a lack of homes going onto the market? New homes supplied by builders. But with output of new construction homes lagging behind delivery prior to the Great Financial Crisis, inventory continues to be limited here too. Since new construction has been relatively muted this cycle, it hasn’t helped offset the lower inventory of existing homes.

This wasn’t the case during the last cycle. During the 2000s, the supply spigot was wide open, and houses were going up at a breakneck pace. Normally a deluge of supply would drive prices down, as there is more on the market then there are buyers. But that wasn’t a normal time. Speculative buying, fueled in part by very lose lending practices, created an artificially high level of demand. The rampant demand quickly shut off as lending practices tightened, cheap money was elusive and people who lost their homes were now unable to qualify for new mortgages. With a smaller buying pool, there was a glut of market inventory from all that construction. Couple that with the wave of distressed properties that came on the market, and there was a lot of housing available.

This cycle, there hasn’t been nearly the same level of construction. Many builders didn’t survive the crash, and those who did were much more conservative. Some of this more muted approach is due to prudent investing decisions, but a lot of it is more practical: There is less land available, more regulations and less skilled labor.

Florida is also coming to terms with its age and history of rampant development – there are less wide-open spaces now than there were historically, so the pace may never be what it was before. This low supply creates a lot of competition among buyers for available homes.

Interest Rates

Interest rates have been hitting historic lows over the past 12 months, and while they are expected to go back up going forward, we’re still dealing with a very low cost of borrowing money. That has fueled a lot of people getting into the market to take advantage of these low rates, which is great, right? Yes – for today. But there is a dark cloud on the horizon.

If you purchased or refinanced your home recently and are enjoying an enviably low interest rate, you have strong purchasing power and the cost to carry that debt is low. But what happens in 10 years when you want to trade up to a new property? All of a sudden you’re in a different interest rate environment, which likely will not be as low as it is today. You will lose the rate you are currently enjoying today, which may dampen your desire to make the deal. As a result, you’ll consider renovating your existing home and make it work longer, rather than take on more expensive debt.

Of course, this scenario would not work for or apply to everyone, but many economists are concerned about the unintended consequences the current low interest rate environment will have on the future market. There will likely be a lower supply of existing homes on the market, which will crunch inventory even more.

So, there you have it – the quick (and easy?) explanation you can give your friends and colleagues when they ask you about why they can’t find a house to buy.

Jennifer Quinn is a Florida Realtors economist and Director of Economic Development

© 2021 Florida Realtors®

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The Unexpected Challenge to Home Repair: Electrical Wiring

New home buyers and remodelers sometimes find an expensive problem as they start to dig in: Old and faulty wiring that needs fixed or even completely replaced.

WASHINGTON – As remodeling surges and more first-time buyers opt for a fixer-upper, some owners discover an unexpected expense: old, faulty electrical wiring. It might not be just in older homes either. An apparent increase in electrical problems may be occurring due to remote work and school may be taxing on older fuse boxes and frayed wiring.

Electricians consider electrical systems older than 1980 most likely to experience problems, The Washington Post reports. But the cost to upgrade can mount quickly – about $25 to $30 an hour to replace a receptacle, for example, and homeowners could be charged about $200 to rewire an outlet and about $3,000 to rewire an electrical system.

Even if buyers discover faulty wiring during an inspection, they might not have the negotiating leverage to do anything about it in today’s seller’s market, either asking the seller to make repairs or negotiating a lower price.

“Buyers don’t have the luxury to reject an old house in this market,” says Catarina Bannier, a sales associate with Compass in Chevy Chase, Md. “With lean inventory and multiple offers, buyers aren’t taking the chance of losing competitiveness by adding contingencies, even ones as ordinary as an inspection clause. A few years ago, I had a buyer who walked away because of an electrical problem, but I doubt I’d see that now.”

Rebecca Weiner, who works in the same real estate office as Bannier, suggests that buyers get a pre-offer inspection – a less comprehensive inspection that’s scheduled by the buyer, with the consent of the seller, prior to submitting an offer on a home.

“A pre-offer inspection lets you know what you’re buying, what fixes you’ll have to make, and, generally, will make you feel more comfortable about the state of the house,” Weiner told the Post. “If you’re out a few hundred dollars, it’s a risk worth taking and the cost of doing the business of buying a house.”

Home inspectors say that during pre-inspections, they’ll determine the age of the furnace, air conditioners and water heater. But during the full inspection – which usually comes after an offer is submitted – they’ll verify circuit breakers are properly matched and corresponding to electric wire sizes and test wall outlets using handheld plug-in testers to check polarity and grounding.

Some of the most common electrical issues home inspectors see include the overloading of outlets and safety hazards from aluminum wiring, which is most often found in older homes. Electricians also say not enough homes use the safer three-prong outlets, referred to as “grounding.” Many older homes have two-prong outlets that could increase the risk of shock or fire if they malfunction.

Source: “How to Avoid Shocking Discoveries in Your Homes Electrical Systems,” The Washington Post (April 7, 2021)

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NAR Report: Marijuana and Real Estate: A Budding Issue

States with marijuana legalization laws have seen increased demand for warehouse space, and about half with pre-2016 legalization laws are seeing addendums added to leases that restrict on-site growing. One recent change: More properties are being bought rather than leased.

WASHINGTON – As more parts of the U.S. legalize marijuana – and as an increasing number of states grow, harvest, store, sell and allow consumption – the real estate industry has felt the effect.

According to a new 2021 report from the National Association of Realtors® (NAR), there has been a noticeable rise in demand for warehouses, land and store fronts used for marijuana. The survey, Marijuana and Real Estate: A Budding Issue, examines the legality of marijuana in terms of medical only, plus, legalized medical and recreational during and after 2016.

More than one-third of respondents in states where marijuana has been legalized the longest said inventory was tight for multiple reasons, and they cited the marijuana industry as one of the factors. This is also true for those in areas where marijuana was more recently legalized, and 23% of Realtors® also partially blamed the marijuana industry for the limited inventory.

“The dynamics of marijuana have been far-reaching over the past year, which is evident when you see how it has impacted real estate,” says Jessica Lautz, vice president of demographics and behavioral insights for NAR. “As the marijuana laws continue to evolve, Realtors have witnessed increased demand for commercial properties to store, grow and sell marijuana.”

Additionally, 29% of commercial members in states that legalized recreational marijuana during the past four years reported growth in property purchasing over leasing in the last year. Nearly half of those in states that had legal medical and recreational marijuana before 2016 have experienced addendums added to residential leases restricting growing on properties; in other states, it’s one quarter or less.

In states where only medical marijuana is legal, two out of three (69%) commercial members said that no additional addendums were inserted into leases about growing marijuana plants. In states where both medical and recreational marijuana is legal, it’s 45% to 55%.

Perhaps to avoid landlord addendums, some business owners buy rather than lease. Business owners who purchase a property don’t have to adhere to marijuana rules or regulations that they may consider burdensome. This property-purchase trend was seen the most in states where marijuana is newly legal.

Respondents in states where recreational marijuana is legal more often said that homeowner associations regularly had policies or restrictions in place pertaining to smoking and growing the product in common areas or exposed areas. Nearly half of the homeowner associations opposed smoking in common areas, while about two-fifths prohibited growing in mutual open areas, such as a private yard without fences.

Those surveyed within states with only prescription marijuana said there often were not any homeowner association rules and regulations related to marijuana.

“We saw that a number of property owners at some point in the past had difficulty leasing their property after a previous tenant consumed marijuana there over an extended period,” says Lautz. “To avoid repeats of those issues, landlords have implemented various guidelines that place numerous restrictions on the use of marijuana.”

Lautz says property owners who have imposed constraints tend to reside or own property in states where marijuana has been legal the longest.

“As the marijuana industry evolves, both commercial and residential landlords are balancing efforts to profit from the progressions, while also ensuring that their property remains desirable and at a high value,” Lautz says.

© 2021 Florida Realtors®

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Fla. Releases $150M for 20 Infrastructure Projects in 15 Counties

Gov. DeSantis says the money from HUD will go to large-scale infrastructure projects that can make Fla. communities more resilient to future disasters.

LAKELAND, Fla. – About $150 million has been awarded to communities through the Florida Department of Economic Opportunity’s (DEO) Rebuild Florida Mitigation General Infrastructure Program. The program, administered by DEO, allows local governments to develop large-scale infrastructure projects to make communities more resilient to future disasters. Gov. Ron DeSantis announced the money recently while speaking in Lakeland.

“This transformational mitigation funding will go a long way in helping Florida’s communities invest in their futures through critical infrastructure improvements,” DeSantis said.

The U.S. Department of Housing and Urban Development’s (HUD) Community Development Block Grant – Mitigation (CDBG-MIT) program provides the funds, which were allocated to Florida. The program originally formed in response to the 2016 to 2017 presidentially declared disasters.

“The Rebuild Florida Mitigation General Infrastructure Program provides storm-impacted communities the opportunity to complete large, high-impact infrastructure projects that will pay dividends for future generations,” said DEO Executive Director Dane Eagle.

Funding from the Rebuild Florida Mitigation General Infrastructure Program

  • Broward County ($6,250,000) – to construct an interconnect between the Broward County Reuse Facility and the City of Pompano Beach’s OASIS Reuse facility.
  • City of Arcadia ($4,823,579) – to widen a stormwater tributary to provide additional storage during storm events to better control flood volume.
  • City of Avon Park ($670,623) – to improve the existing potable water system through replacement of asbestos pipes with PVC piping, adding additional bore to improve water pressure, and to install an upgraded chlorine system.
  • City of Doral ($1,000,000) – to reduce the frequency and severity of stormwater flooding by providing a positive-gravity drainage outfall discharging into the NW 58th Street canal.
  • City of Fort Lauderdale ($10,500,000) – to replace aging and undersized stormwater infrastructure with new systems that help neighborhood flooding issues and better water quality treatment before being released into the intracoastal waterway.
  • City of Key West ($3,099,159) – to install tide valves at 40 stormwater outfall points of discharge to address saltwater flooding of roadways, sidewalks and low-lying properties during high tides.
  • City of Key West ($6,336,165) – to design and construct a pump-assist injection well to address flooding in a low-lying area that collects significant runoff.
  • City of Lakeland ($42,986,390) – to establish a multi-component project in partnership with Bonnet Springs Park that focuses on increasing flood storage capacity to the drainage basin by improving the stormwater infrastructure and watershed quality.
  • City of Lauderhill ($3,125,215) – to complete water and sewer line improvement projects.
  • City of Miami ($13,497,843) – to retrofit portions of existing seawall, construct new sea wall sections, and other coastal resiliency improvements.
  • City of Miami ($1,216,963) – to implement roadway resiliency improvements to NW 17th Street, between NW 27th Avenue and NW 32nd Avenue. Improvements include the installation of a drainage system, exfiltration trench, storm inlets, accessibility ramps and swales.
  • City of North Miami Beach ($6,000,000) – to implement system-wide improvements to the sewer collection system.
  • City of North Miami Beach ($11,700,000) – to enhance the water transmission and distribution system to improve water quality, fire flow capacity, reliability and resiliency.
  • City of Orlando ($2,850,000) – to develop six resiliency hubs that will provide services to low- and moderate-income communities in the recovery phase of a disaster.
  • City of Sebring ($2,605,428) – to complete fire protection resiliency, water quality and water conservation infrastructure improvements.
  • City of Sebring ($3,515,580) – to harden facilities that are part of the cities sanitary sewer collection system.
  • City of West Palm Beach ($16,764,610) – to build resilient seawalls, improve storm water quality, and develop living shorelines, pedestrian hardscaping, and native landscaping.
  • DeSoto County ($3,757,012) – to replace decaying drainage system infrastructure to significantly increase service life and reduce the possibility of flooding.
  • DeSoto County ($3,273,575) – to repair a bridge used as an evacuation route during storms.
  • Osceola County ($4,689,320) – to modify and adapt existing drainage elements to substantially reduce repetitive flooding.

The Rebuild Florida Mitigation General Infrastructure Program has a total allocation of $475,000,000. There will be two additional rounds of funding in the future to communities designated by HUD or the state as Most Impacted and Distressed (MID) by Hurricanes Hermine, Matthew and Irma.

DEO is the state authority responsible for administering all U.S. Department of Housing and Urban Development (HUD) long-term recovery funds awarded to the state. Rebuild Florida uses federal funding for Florida’s long-term recovery efforts from the impacts of natural disasters.

© 2021 Florida Realtors®

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CFPB: Evicted Tenants Can Hold Debt Collectors Accountable

The bureau’s final rule says “debt collectors” must give written notice to tenants before an eviction, with prosecution and private lawsuits possible if they don’t.

WASHINGTON, D.C. – The Consumer Financial Protection Bureau (CFPB) issued an interim final rule in support of the Centers for Disease Control and Prevention (CDC)’s eviction moratorium.

The CFPB’s rule requires debt collectors to provide written notice to tenants of their rights under the eviction moratorium. It also prohibits debt collectors from misrepresenting tenants’ eligibility for protection from eviction under the moratorium.

If a debt collector evicts tenants who may have rights under the moratorium without providing notice of the moratorium – or who misrepresent tenants’ rights under the moratorium – can be prosecuted by federal agencies and state attorneys general for violations of the Fair Debt Collection Practices Act (FDCPA), CFPB says. They’re also subject to private lawsuits by tenants.

“We will hold accountable those debt collectors who move forward with illegal evictions,” says CFPB Acting Director Dave Uejio. “We encourage debt collectors to work with tenants and landlords to find solutions that work for everyone.”

CDC moratorium

A temporary eviction moratorium ordered by the CDC has been extended through June 30, 2021. The CDC order generally prohibits landlords from evicting tenants for non-payment of rent if the tenant submits a written declaration saying they’re unable to afford full rental payments and would likely become homeless or have to move into a shared living setting.

This prohibition applies to an agent or attorney acting as a debt collector on behalf of a landlord or owner of the residential property.

According to a recent Government Accountability Office report, tenants facing eviction may be unaware of the moratorium or may not understand the steps they must take to act on its protections. Declarations can be submitted in languages other than English, and alternative forms are available online.

Reference papers released by CFPB

© 2021 Florida Realtors®

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Pres. Biden’s Proposed Budget Boosts Housing Programs

The fiscal year 2022 “Discretionary Funding Request” is a wish list, but it indicates priorities. The latest requests $68.7B for HUD, an increase of $9B over last year.

WASHINGTON – The Biden-Harris Administration submitted its “Discretionary Funding Request” to Congress, which is essentially a wish list of funding preferences it hopes Congress will include in the next budget. Total dollars and the balance in spending provide a look inside the new administration’s priorities.

For fiscal year 2022 (FY22), Biden requests a total of $68.7 billion for HUD, an increase of $9 billion over the 2021 enacted level, for key Department of Housing and Urban Development priorities (HUD).

According to HUD, it includes a sizable expansion of rental assistance for low-income households; funding for strategies to end homelessness; investments to address the shortage of affordable housing; improvements in the quality of affordable housing through investments in resiliency and energy efficiency; and strategic investments across multiple programs to strengthen communities facing underinvestment. It would also prevent and redress housing-related discrimination.

The “FY22 discretionary funding request turns the page on years of inadequate and harmful spending requests and instead empowers HUD to meet the housing needs of families and communities across the country,” says HUD Secretary Marcia L. Fudge. “I am particularly pleased that the request proposes more than $30 billion to expand housing vouchers to an additional 200,000 low-income families.”

FY22 discretionary request

  • Expands Housing Choice Vouchers to 200,000 additional families. The Housing Choice Voucher program currently helps 2.3 million low-income families obtain housing in the private market. The discretionary funding request proposes $30.4 billion, a $5.4 billion increase over the 2021 enacted level, allowing it to expand assistance to an additional 200,000 households, HUD’s outlines claims. It includes money for mobility-related support services to give low-income families who live in racially and ethnically concentrated areas of poverty with greater options to move to higher-opportunity neighborhoods.
  • Investments to end homelessness. The 2022 discretionary funding request provides $3.5 billion, an increase of $500 million over 2021 enacted levels, for Homeless Assistance Grants to support more than 100,000 additional households, including survivors of domestic violence and homeless youth. The resources would complement the $5 billion for emergency housing vouchers provided in the American Rescue Plan, which Congress previously passed.
  • Modernizes and improves energy efficiency, resilience and safety in HUD-Assisted Housing. HUD-supported rental properties collectively provide 2.3 million affordable homes to low-income families. The funding request fully funds the operating costs across that portfolio, and provides $800 million in new investments across HUD programs for energy efficiency and resilience to climate change impacts, such as increasingly frequent and severe wildfires and floods. In addition, the discretionary request includes $3.2 billion for public housing modernization grants, an increase of $435 million above the 2021 level.
  • Increases the Supply of Affordable Housing. The funding request provides a $500 million increase to the HOME Investment Partnerships Program, for a total of $1.9 billion, to construct and rehabilitate affordable rental housing, and to support other housing-related needs – the highest funding level for HOME since 2009. In addition, the proposal provides $180 million to support 2,000 units of new permanently affordable housing for the elderly and persons with disabilities.

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New Fla. Law Offers Some Protection Against COVID-19 Lawsuits

The Legislature passed and Gov. DeSantis signed a new law that raises the bar for consumers who allege they got infected by COVID-19 at a Fla. business. And businesses have new protections if they’ve made a good-faith effort to comply with government guidelines.

TALLAHASSEE, Fla. – On Friday, March 26, 2021, the Florida Legislature passed a comprehensive bill (SB 72) that severely limits businesses’ risk from COVID-19 lawsuits. Three days later, on Monday, March 29, Gov. Ron DeSantis signed it into law.

For Florida real estate brokers and commercial businesses – including the Mom-and-Pop operations that form the backbone of the state’s economy – a lawsuit alleging “I got COVID-19 from you” is a business threat. Before SB 72 became law, the cost of a court case hung over the head of every Florida business owner.

Under the new law, a lawsuit filed against a Florida business must:

  • Be filed with “particularity,” which generally means a detailed description of the allegation.
  • Include a physician’s affidavit submitted at the same time, stating that the physician believes the defendant (business owner) caused, through acts or omissions, the plaintiff’s damages, injury or death.

If a lawsuit doesn’t have these mandatory elements, a court must automatically dismiss the case. Plaintiffs don’t lose their right to refile, but if they do, they must include the mandatory elements listed. This portion of the law should cut down on frivolous lawsuits.

Even if a COVID-19 sufferer did contract the virus from a brokerage, the new law includes protections for business owners if the courts determine they’ve made a good-faith effort to substantially comply with government-issued health standards or guidance during the COVID-19 pandemic.

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