Dec. 8, 2017

Under tax reform, 14.9% more Fla. sellers could owe capital gains taxes

WASHINGTON – Dec. 7, 2017 – Congress is working on a new tax bill, and the National Association of Realtors (NAR) broke down its potential impacts on a state-by-state basis.

According to NAR, 57 percent of Florida homeowners have a mortgage. Of those, 9.4 percent had a mortgage of more than $500,000 and 2.6 percent pay more than $10,000 in real estate taxes.

The average mortgage interest deduction taken by Florida homeowners was around $9,000 in 2016, and the real estate tax deduction averaged $5,100.

Currently, a typical Florida homeowner who lived in their house for at least two of the last five years would not pay any capital gains taxes if the house is sold. However, the latest proposals require them to live in their homes at least five years. If not, they'll pay an average $12,360 in capital gain taxes at the time of sale, according to NAR.

In Florida last year, 14.9 percent of homeowners lived in their homes between two and four years, meaning about 1 in 9 owners would have to delay a sale up to two years if they hoped to avoid unnecessary capital gains taxation.

NAR's Call for Action: Tell lawmakers to keep the U.S. tax code favorable for homeowners. The automated Call-For-Action system only takes a few minutes to complete.

Realtor efforts to influence tax reform

In politics, success is rarely defined as a single major win. With tax reform, victory comes in increments, such as increasing the cap for a mortgage-interest-rate deduction, and a bipartisan group of lawmakers speaking in Washington agreed that Realtors have played a role in keeping the tax code friendlier to homeowners.

House Financial Services Committee Chairman Jeb Hensarling (R-Texas) and Senate Banking Committee member Heidi Heitkamp (D-N.D.) joined NAR at its Washington offices on Wednesday to talk about tax reform, mortgage finance reform and other issues. The two agreed on one point: Realtors are playing a crucial role in the making of federal policies that affect real estate by providing the kind of realistic and useful input lawmakers need.

"I want to applaud Realtors for what they did during the tax reform debate, because when you sit on the sidelines and hope things get better, that's not a strategy," Heitkamp said at a half-day event called "The Future of the U.S. Housing Market."

Hensarling thanked Realtors for playing an instrumental role in the House passage of comprehensive flood insurance reform about a month ago.

"Thanks to NAR for negotiating in good faith to move that bill forward," Hensarling said. The legislation would reauthorize federal insurance for five years, though the Senate hasn't acted yet on it. Among other elements, NAR sought to ensure grandfathering provisions would be retained for certain properties to protect them against sudden rate increases. Congress also could reauthorize the insurance on a short-term basis until long-term reform is passed.

Hensarling said he hoped that type of cooperation would also be present when lawmakers take up reform of the government sponsored enterprises that create the secondary market for federally conforming home loans. "Hopefully [what NAR did] will serve as model for the GSE debate," he said.

Both Heitkamp and Hensarling said lawmakers are continuing their focus on tax reform.

Hensarling "enthusiastically" supports the bill currently in conference committee, and believes it will result in economic growth of more than 3 percent. That's significantly higher than what it's been during the recovery that started after the economic crash. That level of growth, along with lower tax rates, will help households better than anything government can do, he said.

Heitkamp took a dimmer view, saying the legislation goes against the priority the tax code has historically placed on homeownership. It does that, she said, by cutting or eliminating many of the deductions that households take today.

"You can't just talk about the mortgage interest deduction," Heitkamp said. She noted that while the MID is mostly preserved in both bills, the increase of the standard deduction will mean credit for mortgage payments will no longer factor into the tax picture of many homeowners. "You have to look at it in context of the other deductions."

Heitkamp praised NAR for its involvement in the tax bill. "Your folks have been working day and night, as aggressively and transparently as they can be, to get this fixed," she said.

NAR notched wins by getting the property tax deduction restored in the Senate version of tax reform, although it's capped at $10,000, as in the House bill. And the association successfully made the case to leave current law in place for tax-deferred 1031 exchanges, an important tool for commercial property owners to defer capital gains when purchasing a like-kind property.

Going forward, NAR wants to keep current law in place for the MID, which means retaining the mortgage cap of $1 million and maintaining the capital gains exclusion on the proceeds of sale of a principal residence.

Source: Realtor Magazine, Robert Freedman; and Miami Agent (12/06/2017) Abraham, Rincey. and INFORMATION INC., Bethesda, MD (301) 215-4688

© 2017 Florida Realtors  

Dec. 6, 2017

Need flood insurance? Process could grow difficult

WASHINGTON – Dec. 5, 2017 – The National Flood Insurance Program (NFIP) is set to expire Friday night if Congress doesn't act, a lapse that could roil real estate markets and inject uncertainty into the lives of homeowners in flood-prone areas.

Lawmakers on Capitol Hill are eyeing a brief, two-week extension of the program to buy time for negotiations on a longer deal aimed at overhauling the critical but embattled federally run program.

The looming deadline to deal with the NFIP comes in the midst of a jam-packed and acrimonious stretch in Washington. Leaders on Capitol Hill are launching negotiations over a comprehensive spending bill also needed by Friday to avoid a shutdown of the federal government.

A proposed spending deal unveiled by Republican leaders on Monday would punt on both, keeping the flood insurance program and the government operating through Dec. 22, buying time for further negotiations over domestic and military spending as well as a range of other issues.

Many real estate professionals and advocates for NFIP policyholders had hoped for a longer agreement to offer greater certainty about flood-insurance coverage and rates. But given the looming deadline and frenzy of other activity on Capitol Hill, almost everyone involved now sees a short-term extension as the only realistic option to avoid the program's expiration.

A lapse in the program would create chaos in real estate markets and cause major issues for property owners looking to renew their policies, according to several Louisiana real estate agents who spoke with The Advocate in recent weeks. Banks couldn't sign off on new federally backed mortgages for homes in high-risk food areas and sales even outside those areas would likely slow dramatically or screech to a halt.

"True lapses in the program will literally shut down the markets in flood-prone regions," said Rick Haase, president of the New Orleans-based real estate company Latter & Blum. "Buyers don't want to buy in the unknown, sellers don't want to sell at prices based on the worst-case scenario and lenders don't want to lend."

"If there's a lapse in coverage, it would equate to about 1,300 losses of sales a day and 40,000 a month" nationally, said David McKey, co-owner of the Baton Rouge real estate company Coldwell Banker One and chair of the National Association of Realtors' insurance committee.

"Everybody knows we've got to keep it alive so we're going to do an extension," Sen. John Kennedy, R-Louisiana, said when asked about the prospect of a lapse in the NFIP.

Key factions in Congress have been at loggerheads for months over a raft of proposed changes to the National Flood Insurance Program, which is currently mired in billions of dollars of debt.

Politicians from flood-prone states, including Louisiana's delegation, have pressed for reforms that keep premiums affordable and don't restrict coverage for those in high-risk areas. But a group of fiscal hawks have sought to shore up the program's finances by significantly hiking premiums on those paying below-market rates and booting some properties out of the program altogether.

Another key sticking point is the role of the private market.

Federal regulations currently make it extremely difficult for private insurance companies to offer flood coverage and a number of Republican lawmakers have pushed changes to allow insurers to compete with the federal government. But Louisiana lawmakers and others have expressed concerns that private companies might "cherry pick" customers, luring the most profitable policyholders with lower prices while leaving the NFIP with an increasingly risky and subsidized group of homeowners.

Bridging the gap has proved difficult. The House of Representatives passed a five-year reauthorization to the program in November, a vote that split Louisiana's congressional delegation over concerns that changes in the bill would jack up rates on homeowners in large parts of flood-vulnerable Louisiana.

The Senate has shown no interest in taking up the House-passed bill but has also made little progress toward patching together its own comprehensive proposal from several competing bills, including separate ones sponsored by Kennedy and Sen. Bill Cassidy, R-Louisiana.

It's unclear how close a vote on the proposed spending deal might be or what price Democrats – at least eight needed in the Senate to pass it – might exact before getting on board.

Republicans in both chambers are also just beginning negotiations to hammer out differences between their tax plans, with Republicans hoping to send a final tax bill to President Donald Trump before Christmas.

"Right now, there's so much being jammed (through Congress) that it's been hard for everybody to sit back and consider the policy," Cassidy said Monday evening.

Cassidy added that a series of short-term extensions for the program are increasingly likely. Despite their drawbacks, Cassidy said, a series of short extensions with few or no changes would allow lawmakers time to keep pushing for a policyholder-friendly overhaul of the program.

"If we have to wait a little bit to get better policy, I'm OK with that," Cassidy said. "What we don't want is a piecemeal bill that would eliminate the ability to do important reforms."

"The shorter the better as far as I'm concerned," said Kennedy, "because I want to keep the pressure on to get something passed."

Copyright © 2017 The Advocate, Baton Rouge, La., Bryn Stole. Distributed by Tribune Content Agency, LLC.

Dec. 5, 2017

IRS wants to know: Is that a second home or vacation home?

ORLANDO, Fla. – Dec. 4, 2017 – If vacation has been so much fun that you don't want it to end, a second home might be for you. Think carefully about all the issues surrounding owning a second home, however, because there can be major financial implications.

Investment property vs. vacation home

The most important decision is whether your home will primarily be an investment or a true second home. How you use the home throughout the year will determine how it is classified by the IRS. A true second home is one that only you and your immediate family use.

It's tempting to help cover your expenses by renting out the home to other vacationers while you're not using it, but in the eyes of the IRS, you may have just become a real estate investor.

Tax implications

You can't write off the mortgage interest on an investment property in the same way you do your primary residence, and you must report the rent you receive as income. In certain situations, you may be able to offset the rental income with deductions for interest, taxes, depreciation and home maintenance.

The catch is that the IRS is very interested in the number of days you use the home for personal use each year. If you use the home frequently, you can deduct only the expenses that are proportional with the amount of time you rented out the home. Also, if you rent the unit below market value to friends or family members, the IRS might consider that to be personal use.

As you can see, your tax situation can get complicated in a hurry. Consult a tax adviser before you buy, so you can be sure you understand how the new home will affect your bottom line at tax time.

Financing

Financing a second home also can get complicated. If you have an FHA loan on your primary residence and took advantage of the low-downpayment option, prepare to cough up more cash for a second home than you may be expecting. Because private mortgage insurance won't cover a second home or investment property, you'll need to put down at least 20 percent.

FHA only insures loans on primary residences, so your second home loan will have to be a conventional loan. This means tighter lending standards, particularly when it comes to whether you can afford the payments. Lenders will look closely at your income vs. housing expenses on both homes and may require strict adherence to debt-to-income ratios. Be prepared to show that your income is sufficient to keep both homes afloat.

Other considerations

Add up all of the costs before putting in an offer. Don't forget utilities, home maintenance costs and overhead that can add up, such as furnishings and decor. Also think about how much it will cost to travel back and forth to the home.

If you will rent out the home while you're away, don't forget about property management fees, and be sure to research average local occupancy rates so you're prepared for periods with no revenue.

If you get in over your head, your "dream" vacation home could become the stuff of nightmares.

© Copyright 2017, The Daily Progress, Charlottesville, VA, Anna Changyen

Dec. 4, 2017

Housing trends favor builders focused on entry-level buyers

NEW YORK – Dec. 1, 2017 – It's lining up to be another strong year for investors who own homebuilding stocks.

Shares of the 10 builders with the most completed sales in 2016 are up an average of 60.8 percent. And exchange-traded funds, or ETFs, that invest in homebuilders have also notched gains that eclipse the growth in the broader U.S. stock market.

While many economists expect U.S. housing market growth trends to continue next year, homebuilders that focus on entry-level buyers could be the safest bet for further gains.

"The demand, as we see it, is likely to continue to be pretty good, but the builders that will most benefit will be those who have a focus on the low-end homebuyer," said BTIG homebuilding analyst Carl Reichardt.

A growing economy, solid job market, low unemployment rate and low mortgage interest rates have helped drive demand for homeownership this year. And a stubbornly thin inventory of homes for sale has kept home prices headed higher. All that has been a boon for homebuilders. Sales of new U.S. homes hit the fastest pace in a decade last month.

The trends have also driven gains for some ETFs with exposure to homebuilders. The SPDR S&P Homebuilders ETF is up 27 percent this year, while the iShares U.S. Home Construction ETF is up 54.9 percent.

Many economists expect the economic and housing market trends to continue next year, including further increases in sales of new homes and prices.

"The market for new homes is improving steadily," said Patrick Newport, executive director of U.S. economics at IHS Markit. "The prognosis going forward is for further steady growth over the next two years."

Realtor.com's 2018 U.S. housing forecast released this week calls for U.S. home prices to rise 3.2 percent in 2018, down from a projected gain of 5.5 percent this year, as the inventory of homes for sale begins to rise. The forecast also sees sales climbing 2.5 percent.

Still, favorable housing market trends may not be enough to translate into more big gains for homebuilders.

"At these valuations, close to where they've traditionally peaked out, you have to believe that something else has changed, something secular, either in how these companies are run or in what demand for housing relative to other consumer goods is going to look like," Reichardt said. "And I'm not quite ready to conclude that this time it's different."

Most of the builders that were in business during the last housing boom have yet to see their share prices return to those high-flying levels. Even so, they are now trading close to the top end of their traditional price-to-book value, which has typically ranged between 1 and 2 times.

For now, Reichardt has "Buy" ratings on only two builders, D.R. Horton and Lennar.

Earlier this year, D.R. Horton acquired land developer Forestar Group in a deal that helps beef up the builder's access to land that's been cleared for new construction. Last month, Lennar bought rival CalAtlantic Group in a $5.7 billion deal, not including $3.6 billion in debt, that will create the nation's largest homebuilder.

"Those are two companies undergoing transformations to some degree that we think can result in higher long-term multiples," Reichardt said. "It's harder to make that argument for many of the other companies in the group at these valuations right now."

Reichardt has "Neutral" ratings on most of the other builders he tracks. He also has a "Sell" rating on KB Home.

Another reason Reichardt is bullish on D.R. Horton and Lennar: Both are catering to entry-level buyers, which he believes have more potential to make solid gains at this stage in the housing recovery.

Through much of the housing rebound that began around 2012, many homebuilders primarily sought to cater to homeowners looking to trade up to bigger or nicer homes, which were typically pricier and translated into better margins for builders. Those buyers were also generally in a better financial position to put down a big down payment or qualify for financing.

The tax overhaul making its way through Congress is likely to have an impact on the housing market, which could affect builder stocks.

The projected corporate tax cut would benefit homebuilders, given that they tend to have high tax rates. The group of builders that BTIG tracks has an average tax rate of 34 percent. The proposed tax overhaul bills would reduce corporate taxes to 20 percent.

Other possible changes could be a drag on some builders, including a proposal to limit the mortgage interest deduction on newly purchased homes to the first $500,000 of the loan, instead of the present $1 million limit. That would particularly affect companies building pricier homes on the U.S. coastal metro areas, like Toll Brothers.

Another wild card: mortgage interest rates.

The average rate on a 30-year, fixed mortgage is 3.9 percent this week, down slightly from a year ago. Mortgage rates often track the yield on 10-year Treasury note, which is also essentially flat from a year ago.

Higher rates tend to be negative for homebuilding stocks because they make home loans more costly for would-be homebuyers. Realtor.com projects that mortgage rates will hit 5 percent by the end of next year.

Copyright © 2017 The Associated Press, Alex Veiga. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Dec. 1, 2017

Why does a new owner owe a full year’s property taxes?

FORT LAUDERDALE, Fla. – Nov. 30, 2017 – Question: We bought a house in late September. We just got the tax bill in the mail for the full year. It does not seem fair for us to pay the whole year when the seller lived there most of it. Do we need to pay all of this? – Andres

Answer: Yes. Real estate taxes are typically prorated at the closing when you purchased your home. The purchase contract should have had a section that deals with this issue. Since the tax bill does not become available until November, the contract directs the closing agent to take the amount of last year's taxes and split and prorate the amount based on the date of the closing.

On the closing statement that you signed, the seller will give credit for the amount of taxes for "their" part of the year to the buyer. The buyer will then pay the full amount when the tax bill comes out.

Simply put, the seller already gave you the money for its part of the year, and you must pay the whole bill when it comes out. It is analogous to when two friends are out to lunch, and one has to leave early and gives their friend the money to cover their part of the bill. The remaining friend uses this money and their own to pay the full check when it comes, plus a healthy tip for the hard-working server.

Most contracts will also state that if the taxes are more or less than the estimated amount on the closing statement the appropriate party can seek reimbursement directly from the other side. You should check your contract and closing statement to see if this is the case. Fortunately, most of the time the estimated amount is close to the real thing.

Even if you did not receive the proper credit, you now own the home and are responsible for the taxes and must pay the whole bill. You can then seek reimbursement from the responsible party as appropriate.

About the writer: Gary M. Singer is a Florida attorney and board-certified as an expert in real estate law by the Florida Bar. He practices real estate, business litigation and contract law from his office in Sunrise, Fla. He is the chairman of the Real Estate Section of the Broward County Bar Association and is a co-host of the weekly radio show Legal News and Review. He frequently consults on general real estate matters and trends in Florida with various companies across the nation.

Copyright © 2017 Sun Sentinel (Fort Lauderdale, Fla.), Gary M. Singer. Distributed by Tribune Content Agency, LLC.  

Nov. 30, 2017

NAR: Pending home sales rebound 3.5% in October

WASHINGTON – Nov. 29, 2017 – Pending home sales rebounded strongly in October following three straight months of diminishing activity – but they're still below year-ago levels, according to the National Association of Realtors® (NAR). All major regions except for the West saw an increase in contract signings last month.

The Pending Home Sales Index (PHSI), a forward-looking indicator based on contract signings, rose 3.5 percent to 109.3 in October from a downwardly revised 105.6 in September. The index is now at its highest reading since June (110.0), but it's still 0.6 percent below a year ago.

A big jump in the South after a nice bounce-back after hurricane-related disruptions largely drove the October pending-sales increase, says Lawrence Yun, NAR chief economist. "Last month's solid increase in contract signings was still not enough to keep activity from declining on an annual basis for the sixth time in seven months," he adds. "Home shoppers had better luck finding a home to buy in October, but slim pickings and consistently fast price gains continue to frustrate and prevent too many would-be buyers from reaching the market."

According to Yun, supply and affordability headwinds have not abated. Although homebuilders are doing their best to ramp up production of single-family homes amidst ongoing labor and cost challenges, overall activity still drastically lags demand.

Further exacerbating the inventory scarcity is the fact that homeowners are staying in their homes longer. NAR's 2017 Profile of Home Buyers and Sellers – released last month – revealed that homeowners typically stayed in their home for 10 years before selling (an all-time survey high). Prior to 2009, sellers consistently lived in their home for a median of six years before selling.

"Existing inventory has decreased every month on an annual basis for 29 consecutive months, and the number of homes for sale at the end of October was the lowest for the month since 1991," says Yun. "Until new home construction climbs even higher and more investors and homeowners put their home on the market, sales will continue to severely trail underlying demand."

With two months of data remaining for the year, Yun forecasts that existing-home sales will finish 2017 at around 5.52 million, an increase of 1.3 percent from 2016 (5.45 million).

The national median existing-home price this year is expected to increase around 6 percent. In 2016, existing sales increased 3.8 percent and prices rose 5.1 percent.

The PHSI in the Northeast inched forward 0.5 percent to 95.0 in October, but it's still 1.9 percent below a year ago. In the Midwest, the index increased 2.8 percent to 105.8 in October but remains 0.9 percent lower than October 2016.

Pending home sales in the South jumped 7.4 percent to an index of 123.6 in October and are now 2.0 percent higher than last October. The index in the West decreased 0.7 percent in October to 101.6, and is now 4.4 percent below a year ago.

© 2017 Florida Realtors

Nov. 28, 2017

USF: What do buyers dislike about a neighborhood?

MIAMI – Nov. 27, 2017 – The 2017 Sunshine State Survey from the University of South Florida asked respondents to judge the livability of their own neighborhood and what would deter someone from moving in. It also asked them to predict what the neighborhood will be like in five years, according to Susan A. MacManus, project director.

For the survey, each respondent answered a series of question including this one: "Some community leaders are worried about having enough people to live and fill job openings in their communities. If someone you knew was considering a move, would any of the following keep them from choosing to move to your community? Would ___ be a big problem, somewhat of a problem, or not a problem?"

Respondents were asked to rate 10 possible deterrents listed here in order of concern:

Traffic congestion. Nearly three-quarters of Floridians feel the pain of traffic congestion: 72 percent feel that traffic jams are "somewhat of a problem" or worse, with over a third (34 percent) saying that congestion is "a big problem." There is some indication that the problem is getting worse as the economy improves and more people move to Florida. Those most likely to identify congestion as a big deterrent to in-migration are unemployed workers (40 percent), full-time workers (39 percent), persons of prime working age— ages 35 to 54 (40 percent), Hispanics (40 percent), and those with higher household incomes, who are more likely to live in suburbs (41 percent).

Cost of buying a home. Seven-in-ten Floridians say that the cost of buying a home would be a problem for someone considering moving into their community. These concerns track with rising home prices in the state – up 30 percent across most markets, according to some estimates. Younger Floridians are more likely than older Floridians to say that the cost of buying a home would be a problem for someone considering moving to their community: 76 percent of those ages 18 to 34, compared with 62 percent of those ages 80 and older. Three-fourths of black (75 percent) and Hispanic (77 percent) respondents say that the cost of buying a home is a deterrent to potential newcomers, compared with 65 percent of whites.

Those living in a household earning $75,000 or more are more likely to say that the cost of buying a house would be a problem for someone considering a move to their community (74 percent), perhaps because of a greater awareness of the costs of homeownership (as they are more likely to own a home) or the escalation in property values in their neighborhood.

Rental housing costs. About 70 percent of Floridians identify the cost of rental housing as a possible deterrent to potential residents of their community – 29 percent say it's a big problem, while another 40 percent say it is somewhat of a problem. With population steadily growing in the state and more upper-income residents choosing to rent rather than buy, the demand for rental housing is outstripping availability, and new developments are increasingly tailored to high-end customers. Both trends drive up prices.

With rents rising most in Florida's largest and most diverse cities, residents from racial and ethnic minorities and younger Floridians are hit hardest. Thus, it is not surprising that rental housing costs are identified as an in-migration deterrent by a larger share of Hispanics (83 percent), those ages 18 to 34 (73 percent), and women (74 percent) – each lower wage earners, on average.

Availability of public transportation. Overall, two-thirds (67 percent) say that the availability of public transportation would be a problem for people considering moving into their community; 38 percent see it as a "big" problem – a higher share than for any other issue examined. More women (40 percent), Hispanics (42 percent), those not in the work force (47 percent), those with a household income of less than $35,000 (41 percent), older Floridians ages 55 to 64 (42 percent) and ages 65 to 79 (40 percent), and college graduates (41 percent) point to the lack of public transportation as a reason to deter future residents from moving in to the community.

Except for college graduates, the other demographic groups have larger shares of low income and/or disabled persons, less likely to drive and more likely to rely on public transit to get around.

Availability of affordable long-term health care. Sixty percent of Floridians say that accessing affordable long-term care would be a problem for someone considering a move into their community – either "big" (22 percent) or "somewhat" of a problem (38 percent). Among those most likely to say that long-term care affordability is "a big problem" are Baby Boomers (30 percent) and lower-income Floridians (30 percent). Boomers are more attentive to the costs of long-term care; while those with low incomes worry that neither they nor others in similar circumstances could afford long-term care in their community.

Commute time to work. A majority of Floridians (58 percent) say that commute times would be either a "big" problem (21 percent) or "somewhat" of a problem (37 percent). Those most likely to identify commute times as a "big" problem are Hispanics (27 percent), those ages 35 to 64, full-time workers (25 percent), those with a household income of at least $35,000 but less than $75,000 (26 percent), and college graduates (25 percent).

Access to quality health care. Floridians are split over whether access to quality health care would be a problem for someone considering a move into their community. Nearly equal shares say that access to quality health care would not be a problem (49 percent) as say that it would be a problem (48 percent)" somewhat of a problem" (31 percent), a "big problem" (17 percent).

Majorities of millennials (57 percent), blacks (61 percent), Hispanics (54 percent), part-time workers (53 percent), the unemployed (62 percent) or not working (58 percent), and lower-income (56 percent) Floridians say that healthcare access poses either "a big problem" or "somewhat of a problem" to potential newcomers. These gaps in opinion follow health insurance trends: 13 percent of Floridians are uninsured, and the uninsured are disproportionately young, poor and non-white. Floridians, especially in these groups, are more likely to work in low-skill service jobs, and many of their employers either do not offer health insurance or offer plans that are unaffordable for low-income people.

Quality of schools. People with a child in school are less likely to say that school quality would be a deterrent to future buyers than current residents without children (51 percent vs. 46 percent). So, too are wealthier individuals, who can better afford to choose locations with good schools than those with household incomes of $35,000-$74,999 (52 percent vs. 41 percent).

Public safety. A majority of Floridians do not see public safety problems as keeping someone from moving in to their community, but 39 percent do (7 percent view it as a "big problem" and 32 percent as "somewhat of a problem.") Even crime rate data send mixed signals. While both property and violent crime rates have halved in the state since 1996, both rates are still substantially higher than the national average.

Black (49 percent), Hispanic (50 percent), and low-income (47 percent) Floridians are most concerned about public safety. Minority Floridians are more likely to live in urban areas, where the number and rate of crimes tends to be higher, while low-income people tend to live in poorer communities, also with generally higher levels of crime.

Availability of public parks and recreation spaces. Few say that the availability of parks and recreation places would be a "big" problem (6 percent) or "somewhat" of a problem (19 percent) affecting a potential in-migrant's decision. A larger share of women (29 percent) and lower-income persons –household income below $35,000 (30 percent) – cite the availability of parks and recreation spaces as a negative in their community.

Women (mothers) are generally more aware of the location and condition of the parks around them. And previous research has found that poorer persons tend to live a greater distance from green spaces.

Nov. 27, 2017

5 First-Year Mistakes New Owners Make

CHICAGO – Nov. 22, 2017 – Homeowners can make a lot of mistakes during that first year in homeownership, especially when eagerness may sometimes lead to ignorance. HouseLogic recently featured several of the most common and costly missteps homeowners make in their first year, including:

1. Always going with the lowest bid.

Homeowners may be smart about gathering multiple bids when, say, that HVAC system needs repairs. But they may be tempted to always go with the lowest price. HouseLogic recommends ensuring that all bids include the same project scope. At times, one bid may be less expensive but may not include all of the actual costs or details of the project, or the contractor may lack the experience to do a good job.

2. Submitting small insurance claims.

Owners shouldn't be in a rush to submit an insurance claim every time something goes wrong. Filing a claim or two, particularly over a short time, can prompt an increase to your premium. Amy Bach, executive director of United Policyholders, says it's better to pay out of pocket than to submit claims that are less than your deductible. "You want the cleanest record possible," Bach says. "You want to be seen as the lowest risk. It's like a driving record – the more tickets you have, the more your insurance."

3. Failing to consider the ROI of home remodeling improvements.

Homeowners shouldn't believe that just because they see the value in an upgrade, they will get an added market value for it when they go to sell. Owners can over-upgrade their home. "It's easy to build yourself out of your neighborhood" and invest more than you can make at resale, says Linda Sowell, a real estate professional in Memphis, Tenn. Homeowners should check with a real estate professional or appraiser before they start a project to learn whether the improvement will help boost their property value.

4. Tossing receipts and paperwork.

Homeowners need to keep good records. HouseLogic recommends keeping home improvement receipts, contracts and manuals in a three-ring binder with clear plastic sleeves. Or they can photograph documents and store them on a computer or in the cloud.

5. Ignoring seemingly minor items on an inspection report.

An inspection report can make a great first to-do list once moving in, HouseLogic says. Seemingly minor issues, like loose gutters or uninsulated pipes, may eventually cause bigger damage if not repaired soon. New owners should consult a contractor and make an informed decision about what needs to be fixed right away and what can wait.

Source: "8 Costly Missteps New Homeowners Make in Their First Year," HouseLogic.com (2017)

Nov. 22, 2017

Florida's home sales, median prices rise in October

ORLANDO, Fla. – Nov. 21, 2017 – The impact of Hurricane Irma on Florida's housing market resolved by the end of October, according to the latest housing data released by Florida Realtors®. Sales, median prices, new listings and new pending sales rose even as the inventory of for-sale properties remained constrained in many areas. Sales of single-family homes statewide totaled 20,543 last month, up 2 percent compared to October 2016.

"Home purchases stalled by Hurricane Irma striking Florida in September resumed – and many of those sales closed in October," said 2017 Florida Realtors President Maria Wells, broker-owner with Lifestyle Realty Group in Stuart. "Areas hit hardest by the hurricane will still take time to recover, but in other parts of the state, real estate activity has returned. Sellers were ready to put their homes on the market in October, with new listings for single-family existing homes up 9.8 percent year-over-year; new listings for existing condo-townhouse properties rose 14.6 percent.

"Wherever you are, there is a local Realtor who can help you understand local market conditions and prepare for a successful home sale or home purchase."

The statewide median sales price for single-family existing homes last month was $235,558, up 7.1 percent from the previous year, according to data from Florida Realtors Research Department in partnership with local Realtor boards/associations. Thestatewide median price for condo-townhouse properties in October was $170,000, up 5.2 percent over the year-ago figure. October was the 70th month-in-a-row that statewide median prices for both sectors rose year-over-year. The median is the midpoint; half the homes sold for more, half for less.

According to the National Association of Realtors®(NAR), the national median sales price for existing single-family homes in September 2017 was $, up 5.6 percent from the previous year; the national median existing condo price was $$555,410in Massachusetts, it was $380,000; in Maryland, it was $277,746; andin New York, it was $257,500.

Looking at Florida's condo-townhouse market, statewide closed sales totaled 8,116 last month, up 2.2 percent compared to October 2016. Closed sales data reflected fewer short sales and foreclosures last month: Short sales for condo-townhouse properties declined 22.5 percent and foreclosures fell 42.8 percent year-to-year; short sales for single-family homes dropped 36.7 percent and foreclosures fell 42.3 percent year-to-year. Closed sales may occur from 30- to 90-plus days after sales contracts are written.

"Last month, we talked about how it's not uncommon for Florida to see a quick rebound in sales of existing homes the month after a hurricane," said Florida Realtors®Chief Economist Dr. Brad O'Connor.<span< p="" style="margin: 0px; padding: 0px; border: none; border-spacing: 0px; border-collapse: collapse;"></span<>

October's for-sale inventory remained tight with a 3.8-months' supply for single-family homes and a 5.6-months' supply for condo-townhouse properties, according to Florida Realtors.

According to Freddie Mac, the interest rate for a 30-year fixed-rate mortgage averaged 3.90 percent in October 2017; it averaged 3.47 percent during the same month a year earlier.

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© 2017 Florida Realtors®

Nov. 21, 2017

Buyers snapping up homes at fastest pace in 30 years

CHICAGO – Nov. 20, 1017 – Homes are sitting on the market for the shortest time in 30 years, according to an annual report on homebuyers and sellers by the National Association of Realtors.

The report focused on about 8,000 homebuyers who purchased their home in the year ending in June. It found the typical home spent just three weeks on the market. That was down from four weeks in the year ending June 2016 and 11 weeks in 2012. It was the shortest time since the NAR report began including data on how long homes spend on the market, in 1987.

Buyers are snapping up homes quickly at a time when for-sale listings are in short supply, forcing them to compete. The number of available properties declined in September, according to NAR's monthly report on existing home sales, marking the 28th consecutive month of year-on-year decline in inventory.

In addition to moving fast, buyers also had to pay more to close the deal. Forty-two percent of buyers paid at least the listing price, the highest share since the NAR survey started keeping track in 2007.

"With the lower end of the market seeing the worst of the supply crunch, house hunters faced mounting odds in finding their first home," said Lawrence Yun, NAR chief economist. "Multiple offers were a common occurrence, investors paying in cash had the upper hand, and prices kept climbing, which yanked homeownership out of reach for countless would-be buyers."

Source: Bloomberg (10/30/17) Clark, Patricia

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