September « 2009 « Smith and Associates Blog

Housing construction, permits rise September 18, 2009
By Smith & Associates

Housing starts and building permits rose to their highest levels in nine months in August, but the gains were led by multifamily and apartment construction.

Housing starts for single-family homes fell 3 percent. Total housing starts rose 1.5 percent to an annual rate of 598,000. Building permits rose 2.7 percent in August.

The Commerce Department report comes a day after the National Association of Homebuilders reported its homebuilder confidence index rose for the third consecutive month in September and reached its highest level in 18 months.

KB Home, the Los Angeles-based builder that pulled out of the Mid-Atlantic region in 2008 as demand slumped, announced this week it would resume home construction in the Washington region, saying “the time was right.”

New home sales rose 9.6 percent in July, the biggest monthly increase in sales in more than four years.

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Freddie Mac: Mortgage rates fall
By Smith & Associates

Rates for a 30-year, fixed-rate mortgage averaged 5.04 percent, with points averaging 0.7 for the week ended Sept. 17. That is down from previous week, when it averaged 5.07 percent, according to Freddie Mac (NYSE: FRE).

Last year at this time, the 30-year, fixed-rate mortgage averaged 5.78 percent.

The 15-year, fixed-rate mortgage this week averaged 4.47 percent, with points averaging 0.6, down from the previous week, when it averaged 4.5 percent. A year ago at this time, the 15-year, fixed-rate mortgage averaged 5.35 percent. This is the lowest it has been since the McLean, Va.-based lender started tracking it in 1991.

“Interest rates for fixed-rate mortgages eased for the third consecutive week and remained at three-month lows,” said Frank Nothaft, Freddie Mac VP and chief economist, in a news release.

On Wednesday, the Mortgage Bankers Association reported that loan applications fell by a seasonally adjusted 8.6 percent, the result of the Labor Day holiday.

Smith & Associates Real Estate’s preferred Mortgage Consultants will be happy to discuss available loan programs with you. For more information, please visit the website.

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Builder confidence edges up in September
By Smith & Associates

Builder confidence in the market for newly built, single-family homes edged higher for a third consecutive month in September, according to the National Association of Home Builders/Wells Fargo Housing Market Index.

The index rose one point to 19 this month, its highest level since May 2008.

“Builders are seeing some improvement in buyer demand as a result of the first-time homebuyer tax credit, and low mortgage rates and strong housing affordability have also helped to revive some optimism,” said Joe Robson, chairman of the National Association of Home Builders.

Derived from a monthly survey that NAHB has been conducting for more than 20 years, the NAHB/Wells Fargo Housing Market Index gauges builder perceptions of current single-family home sales and sales expectations for the next six months as “good,” “fair” or “poor.”

The survey also asks builders to rate traffic of prospective buyers as “high to very high,” “average” or “low to very low.” Scores for each component are then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view sales conditions as good than poor.

Two out of three of the HMI’s component indexes recorded gains in September. The index gauging current sales conditions rose two points to 18, while the index gauging traffic of prospective buyers rose one point, to 17. Meanwhile, the index gauging sales expectations for the next six months declined one point, to 29.

All four regions posted gains in their HMI readings for September. The biggest improvement was registered in the Midwest, where a three-point gain brought its HMI to 19, the highest level since July of 2007. The Northeast posted a two-point gain to 24, the South posted a two-point gain to 19 and the West posted a one-point gain to 18.

From high-rise condominiums to lofts and townhomes or to newly built custom homes, Smith & Associates Real Estate can help you find it. Learn about a variety of new developments and search for your next dream home here.

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FHA and USDA allow low or no down payment September 17, 2009
By Susie Timmerman

FHA – Low Down Payment

With new incentives throughout the real estate industry, there are buyers in the marketplace that are new to the process of residential mortgages. With the FHA program, the required down payment is only 3.5% and this down payment can be a gift from a relative. In addition, the Seller can contribute up to 6% of the purchase price of the home towards the Buyer’s closing costs and prepaid items. When you combine these two features of the FHA product, a Buyer can come to the closing table with no money out of his/her pocket. This has enabled many people to purchase homes that do not have the 20% down payment required by most conventional lenders.

The FHA mortgage loan limit in the Tampa Bay Area is $ 292,500.00 – with the 3.5% down payment, the maximum purchase price would be $ 303,105.00 . An FHA loan does have standards for the home to qualify. Basically, the home needs to be in sound structural condition including roof, windows, doors, etc.. Minor cosmetic repairs are permitted under the FHA mortgage loan guidelines. FHA does allow the purchase of multi-unit properties up to 4 units as long as the Buyer lives in the property as a primary residence. Smith and Associates’ realtors are aware of these standards and work closely with us to ensure a seamless process.

FHA loans are also available to refinance your present mortgage to a lower interest rate. Homes can be refinanced up to 96.5% of today’s market value. This can be significant if you presently have a high interest rate and/or have an ARM loan that will be adjusting within the next couple of years. Contact us to evaluate your present mortgage to determine if you would benefit from a FHA loan.

USDA – No Down Payment

USDA is a program through the Federal Government that allows up to 100% mortgage financing in rural areas. The home has to be within a certain rural area which is determined by population concentration. Tampa Bay area locations include Land O Lakes, Wesley Chapel, southern Hillsborough County, east Hillsborough County, etc.

As with FHA loans, the Seller can contribute up to 6% of the closing costs/prepaid items, the Buyer can receive gift monies from relatives, etc. Additional criteria to qualify for this loan program include income limitations for the Buyer(s) which vary according to the area of the country and the number of people that will be living in the home.

Smith & Associates Real Estate’s preferred Mortgage Consultants will be happy to look up properties and evaluate your situation to determine if you are eligible for this loan program. For more information, please visit the website.

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Realtors group calls for tax credit extension September 16, 2009
By Smith & Associates

The tax credit that has helped lift home sales expires in just over two months, and the National Association of Realtors wants it extended.

The $8,000 first-time homebuyer credit will expire November 30, giving any buyers hoping to take advantage of it a very short window to qualify, when factoring in the time it takes to find a property and to close on its sale.

“Now is the time for Congress to keep this recovery going by extending the tax credit through 2010 and making it available to more homebuyers, says NAR president Charles McMillan. “The credit needs to be available for an additional period of time in order to sustain the progress that’s been made so we can continue to see our markets fully recover.”

The first-time buyer credit, which was implemented earlier this year, has brought 1.2 million new buyers into the market, the NAR estimates. It says 350,000 of those buyers would not have purchased a home without the credit.

Do you have questions regarding your eligibility or are you interested in talking to a mortgage professional regarding purchasing a home? Smith & Associates is here to help! Please click here to get in touch with a mortgage consultant.

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Spending to Sell … Faster September 14, 2009
By David B Moyer

MANY buyers today — unsure whether prices have gone as low as they will go — aren’t looking for just a good deal. They’re looking for a steal.

For sellers, that means that to create even the slightest frisson to lure in buyers, they must either price their homes at distressingly low prices or present a property that is in turnkey condition.

Even if real estate values have started to level off, most buyers are still intent on paying rock-bottom prices. And once they have bought a place for a song, they are in no mood to spend a penny on remodeling. They want to do nothing more than unpack a toothbrush and move right in.

This means, of course, that any apartment with a 1980s renovation or more than slightly worn countertops is destined for intense scrutiny and many weeks on the market.

Some sellers are making the bold move of renovating their homes to sell them. Brokers say that this strategy can help keep the price out of the basement, and more important, help the home sell much more quickly.

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“Buyers loved what they did to the place,” she said. “There’s no question it made it 100 percent easier to sell.”

A search of listings in recent weeks produced several sellers who went well beyond clearing out clutter, deciding to pour thousands of dollars into renovating their homes before putting out a for-sale sign. The improvements ranged from refacing cabinets and installing new appliances to gut renovations of kitchens and bathrooms.

Some of the owners suspect they may lose money when they finally sell, but they are united in the conviction that the wait will be shorter than it would have been without the renovations.

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Real Estate sales in the Tampa Bay market has picked up over the past months, the sales have been the combination of the best product mixed with the best price. Buyers are willing to pay a little bit more for the home that is renovated and does not require spending further dollars to improve the home. Our website offers 2 great links to help you on your way to selling your home fast! Our preferred vendor list will help you with interior design, repair, or remodeling to get your home at the top level to sell. We also have a Smith & Associates Real Estate tailored CMA that will help you find out What Your Home is Worth. An agent will work on the information you provide to come with a suggested list price for the market. When determining the value of a home it is important to consider features such as the interior, the view, the street and surrounding neighborhood, and recent upgrades as compared to other available property in the area. Unlike the available national resources, our agents are experienced, local real estate professionals who know every nuance of every home in the neighborhoods we serve. It is only with our knowledge of the area and careful consideration that we can truly provide you with your home’s accurate value in the current market environment.

An excerpt from:

THE NEW YORK TIMES REAL ESTATE SECTION

By Vivian Toy

Published: September 4, 2009

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Chinese Drywall September 10, 2009
By Smith & Associates

Historically, the relocation industry has been challenged by such environmental issues as UFFI, asbestos, radon gas, synthetic stucco, and black mold… Some three hundred million board feet of Chinese drywall has been imported into the United States in the past eight years and its use could be a nationwide problem having a profound effect on transferees, relocation companies, and corporations.

What Is Chinese Drywall?
Thomas Martin, president of America’s Watchdog, a private national consumer advocacy group based in Washington, DC, believes the suspect imported Chinese drywall is made from material taken from vats under a conveyor belt filled with coal. Gypsum is dripped into the coal to clean it. Martin’s sources say the liquefied vats are being shipped to drywall manufacturers without cleaning them, and turned into drywall…

Warning Signals
How can a problem be detected?
1. The drywall releases sulfur dioxide gas creating sulfuric acid. There is a smell like rotten eggs. Unfortunately, not all affected homes contain this odor.
2. Look for pitting faucets, appliances, and chrome, or blackening of silver jewelry.
3. Look inside your electrical outlets and fuse box. If you have a soot-like blackening on the copper wires, they are being eaten away and could short circuit and create a fire.
4. Smoke and carbon monoxide alarms, cable boxes, televisions, and computers begin to fail, and light switches stop working.
5. Copper air conditioning coils pit, creating holes and releasing freon gas into the homes. Open the back of your air conditioner and inspect the coils and pipe leading out. If they are soot black rather than normal tarnished copper, you may have a problem. Call an air conditioning repairman to confirm.
6. Brass and other metal fittings in natural gas furnaces corrode. Look for possible leakage.
7. Inspect drywall for a “Made in China” label.

If any of the above are discovered, you should follow up with your builder, county or state health department, the Environmental Protection Agency (EPA), and your insurance company…

Article Courtesy of: Alvin L. Wagner, Jr., SCRP, SRA, Ft. Myers, Florida… a consultant to A.L. Wagner Appraisal Group.

Chinese Drywall

What Is Chinese Drywall?

Thomas Martin, president of America’s Watchdog, a private national consumer advocacy group based in Washington, DC, believes the suspect imported Chinese drywall is made from material taken from vats under a conveyor belt filled with coal. Gypsum is dripped into the coal to clean it. Martin’s sources say the liquefied vats are being shipped to drywall manufacturers without cleaning them, and turned into drywall…

Warning Signals

How can a problem be detected?

1. The drywall releases sulfur dioxide gas creating sulfuric acid. There is a smell like rotten eggs. Unfortunately, not all affected homes contain this odor.

2. Look for pitting faucets, appliances, and chrome, or blackening of silver jewelry.

3. Look inside your electrical outlets and fuse box. If you have a soot-like blackening on the copper wires, they are being eaten away and could short circuit and create a fire.

4. Smoke and carbon monoxide alarms, cable boxes, televisions, and computers begin to fail, and light switches stop working.

5. Copper air conditioning coils pit, creating holes and releasing freon gas into the homes. Open the back of your air conditioner and inspect the coils and pipe leading out. If they are soot black rather than normal tarnished copper, you may have a problem. Call an air conditioning repairman to confirm.

6. Brass and other metal fittings in natural gas furnaces corrode. Look for possible leakage.

7. Inspect drywall for a “Made in China” label.

If any of the above are discovered, you should follow up with your builder, county or state health department, the Environmental Protection Agency (EPA), and your insurance company…

Alvin L. Wagner, Jr., SCRP, SRA, Ft. Myers, Florida… a consultant to A.L. Wagner Appraisal Group.

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First time buyers face deadline
By Smith & Associates

The government’s first time homebuyer $8,000 tax credit has helped stimulate home sales, but buyers still hoping to take advantage of it will have to beat the clock.

The tax credit expires Nov. 30, giving buyers about 12 weeks to find, contract and settle on their purchase. The National Association of Realtors says on average, first-time buyers search 12 weeks to find a home, and closing can take up to 60 additional days.

The group says buyers still hoping to qualify for the credit will have to act quickly.

“By moving quickly, being prepared to make decisions in the face of increased competition, and [learning] from others to reduce time without cutting corners, first-time homebuyers starting today can close on time and quality for the $8,000 federal tax credit,” says Errol Samuelson, president of Realtor.com.

The tax credit was cited as the most important reason for buying by 10.8 percent of current homebuyers in a Realtor.com survey. An estimated 1.4 million buyers have already filed for the credit, with that number likely to swell by the time tax returns are due next April.

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A ‘Stream Of Light’ In The Local Market
By Robert Glaser

The market reports continue to show a ‘stream of light’ as sales continue to be ahead of ’08 in units closed with an affordability factor that has caused those that have secure employment to jump in and purchase. In two of the markets we dominate, South Tampa and the Southern Pinellas peninsula the clients in the ‘luxury’ market sector are asking when the upward swing of sales will affect their market. The luxury sales have settled into a range of 900,000 -1,100,000 for newer well located estate type properties with buyers putting more cash down to to achieve a conforming loan. This price range has continued to expand and in the last 60 days in South Tampa there is a firming up of values in prime neighborhoods for well appointed four bedrooms homes that fall into that best price range.

These homes have to be able to support appraisal value with their condition and amenities being ‘best of market’ to ensure a smooth closing. The banks have begun the process of introducing jumbo loan produsts back into the market, but it will be well into the late 4th quarter of 2009 before we see competitive mortgage products that will help lift this market back on its feet. The sellers of homes considered to be in a luxury range have the benefit of downsizing to such great opportunities in condominiums or other property types that they are able to better adjust their value that, no longer exist, in order to sell and move to their ideal habitat.

Some recent closings at Smith & Associates Real Estate in the luxury range this year are listed below:

Property Address	List Price
3702 EL CENTRO ST	5,900,000
1229 BRIGHTWATERS BLVD NE	4,300,000
310 BLANCA LN	3,950,000
112 LADOGA AV	3,450,000
8 SPANISH MAIN ST	2,995,000
4926 ANDROS DR	2,375,000
8568 W GULF BLVD	2,199,000
2913 PASS A GRILLE WAY	2,190,000
34 ADALIA AV	2,100,000
4424 S SWANN CIRCLE	1,995,000
5200 62ND AVE S	1,990,000
3903 SNAPPER POINTE DR	1,750,000
175 1ST STREET S # 3404	1,650,000
818 S ORLEANS AV	1,625,000
2913 W HAWTHORNE RD # 1/2	1,500,000

The Smith & Associates Real Estate sales team is proud of their accomplishments and can share the market knowledge we have developed to achieve results for the buyer or seller of today’s luxury homes. To view available luxury real estate in the Tampa Bay area, view Smith & Associates Real Estate’s Signature Collection.

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Foreclosure drops in two Tampa Bay counties, but U.S. up 18%
By Smith & Associates

Foreclosure rates have dropped in Pinellas and Sarasota counties, bucking a national trend of near record-high numbers of homes on the brink of being reclaimed by banks.

Sarasota witnessed a 17.7 percent drop in foreclosures between August 2008 and last month with 849 filings representing one in every 260 homes, according to a new report from RealtyTrac. Pinellas had a 5.7 percent drop year-over-year with its 1,944 filings representing one in 257 homes in some form of foreclosure.

The country as a whole was not as fortunate. Foreclosure rates were up nearly 18 percent nationwide with one in every 357 homes experiencing some level of foreclosure either from a default notice, scheduled auction or bank repossession.

“The August report demonstrates that there is still an ample supply of properties filing the foreclosure pipeline even when the outflow of bank-owned REO properties onto the resale market is being more carefully regulated,” said James J. Saccacio, RealtyTrac’s chief executive officer, in a release. “After hitting a high for the year in July, REOs dropped 13 percent in August, but we also saw a record high number of properties either entering default or being scheduled for a public foreclosure auction for the first time.”

Polk County had the biggest jump in foreclosures, rising more than 40 percent to 1,892 filings, or one in every 147 houses. Hillsborough County foreclosures rose 23.5 percent with 2,341 filings representing one in every 220 homes while Hernando County was up 22 percent with 515 filings, representing one in every 156 homes.

Pasco County had a 9.8 percent rise in foreclosures with 1,010 filings, or one in every 216 homes. Manatee County’s rate was up just under 3 percent with 942 filings representing one in every 180 homes.

Florida had the second highest foreclosure rate in the nation behind only Nevada with one in every 140 homes receiving some sort of foreclosure filing, according to RealtyTrac. Florida was one of six states — joining California, Michigan, Nevada, Arizona and Illinois — that accounted for more than 60 percent of the nation’s total foreclosures.

Among metropolitan areas, the top foreclosure-ridden regions were dominated by California and topped with Las Vegas. Only two Florida metros were in the top 10 — Orlando-Kissimmee at No. 8 with one in every 87 houses in some form of foreclosure and Cape Coral-Fort Myers at No. 9 where one in every 88 homes received a foreclosure filing.

Looking for foreclosure properties in Tampa Bay? Take a look at Smith & Associates Real Estate’s ‘Best Values’ properties here.

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