| Housing Tax Credits 2008/2009/2010
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What are the 2008-2009-2010 housing tax credits?
What is the real property tax deduction?
What is the first-time homebuyer tax credit?
Who is eligible for the first-time homebuyer tax credit?
What is the non-first-time homebuyer tax credit?
Who is eligible for the non-first-time homebuyer tax credit?
Are there special rules for people in the military?
How do I get the homebuyer tax credit?
Do I have to pay back the credit?
What tax forms do I file?
Useful links
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Update! The White House has extended and expanded the homebuyer tax credit through June 30, 2010, as long as a binding sales contract is signed no later than April 30, 2010. First-time homebuyers and non-first-time homebuyers are now eligible for the credit. Highlights of the expanded homebuyer tax credit are:
the tax credit applies to homes purchased after November 6, 2009 and before July 1, 2010
first-time homebuyers and non-first-time homebuyers are eligible
income limits are increased to $125,000 for single taxpayers and $225,000 for married taxpayers for the full credit; and $145,000 single and $245,000 married for the partial credit
military personnel on extended duty outside the U.S. get an extra year to buy a house and claim the credit
What are the 2008-2009-2010 housing tax credits?
The 2008-2009-2010 housing tax credits are federal tax incentives to help revitalize the housing market, prevent foreclosures, and strengthen the economy.
The credits are part of the:
Worker, Homeownership, and Business Assistance Act of 2009
American Recovery and Reinvestment Act of 2009
2008 American Housing Rescue and Foreclosure Prevention Act
The housing tax credits offer tax incentives to homeowners, homebuyers, and developers of low-income housing, including:
a two-year limited property tax deduction for homeowners who do not itemize their deductions
a refundable tax credit for eligible first-time homebuyers
a refundable tax credit for eligible non-first-time homebuyers
increased tax credits for developers of low-income rental housing
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What is the real property tax deduction?
Homeowners who pay property taxes but do not itemize their deductions get a limited increase in the standard deduction on their 2008 and 2009 federal taxes. The property tax deduction:
is for homeowners who do not itemize deductions
is a temporary deduction, only for 2008 and 2009 taxes
increases the standard deduction by $500 (single) or $1000 (married filing jointly), but not more than the amount paid in state and local property taxes for the year
The instructions for federal tax Forms 1040 and 1040A include a Standard Deduction Worksheet to help you calculate your standard deduction with the property tax deduction included.
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What is the first-time homebuyer tax credit?
The first time homebuyer tax credit is a refundable federal tax credit for homebuyers who have not owned a home within the past three years. To qualify, you must purchase a home on or after April 9, 2008, sign a binding sales contract before May 1, 2010, and close before July 1, 2010. Your home can be a single-family house, a condo, a co-op, mobile home, or townhouse, and must be your principal residence.
The tax credit is worth 10% of the home's purchase price, up to a maximum credit of:
$8000 for homes bought in 2009 and 2010 ($4000 each for married filing separately)
$7500 for homes bought in 2008 ($3750 each for married filing separately)
For the 2009 and 2010 tax credits, you do not have to repay the credit as long as you own and live in the home as your principal residence for at least three years.
The 2008 first-time homebuyer tax credit has to be repaid. In effect, the tax credit is an interest-free loan from the federal government that must be repaid in equal installments over 15 years.
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Who is eligible for the first-time homebuyer tax credit?
To qualify for the first-time homebuyer tax credit, you must be a homebuyer who:
did not own a primary residence during the three years prior to the purchase
buys a single-family principal residence in the U.S. on or after April 9, 2008, signs a binding sales contract before May 1, 2010, and closes before July 1, 2010 (If you build a home, the date you first occupy your home is considered to be the purchase date.)
is a citizen, or a resident alien as defined by the IRS
did not buy the home from a related person who is an ancestor or descendant (spouse, parent, grandparent, child, grandchild, etc.)
meets the income guidelines below
owns and lives in the home for at least three years (For the 2008 credit, you must have lived in the home until the end of the tax year)
If you buy a home November 7, 2009 or later, you must also:
provide proof of purchase when you file your income taxes
be at least 18 years old
not be claimed as a dependent by another taxpayer
buy a home for less than $800,000
The first-time homebuyer tax credit income limits are:
First-Time Homebuyer Tax Credit Income Limits
(Modified adjusted gross income) Filing status Date of purchase Full credit
income limits Partial credit*
income limits
Single or
Head-of-household Before Nov. 7, 2009 less than $75,000 $75,000 to $95,000
Nov. 7, 2009 or later less than $125,000 $125,000 to $145,000
Married filing jointly Before Nov. 7, 2009 less than $150,000 $150,000 to $170,000
Nov. 7, 2009 or later less than $225,000 $225,000 to $245,000
*The tax credit phases out for homebuyers with incomes in the partial credit range. Homebuyers with incomes above the upper limit do not qualify for the credit.
The higher income limits only apply to homes bought on or after November 7, 2009. If you bought a home before November 7, 2009 and did not qualify for the tax credit because of your income, you cannot claim the credit based on the higher income limits.
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What is the non-first-time homebuyer tax credit?
The non-first-time homebuyer tax credit is a refundable federal tax credit for current and former homeowners who do not meet the first-time homebuyer requirements. To qualify, you must have owned and lived in your previous home for at least five consecutive years of the eight years before the purchase. The tax credit equals 10% of the purchase price, up to a maximum of $6500 ($3250 each if married filing separately).
You can claim the credit if you buy a home after November 6, 2009, sign a binding sales contract before May 1, 2010, and close before July 1, 2010. Your new home does not have to cost more than your previous home. You do not have to sell your previous home to be eligible for the tax credit, but you must live in your new home as your principal residence for at least three years.
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Who is eligible for the non-first-time homebuyer tax credit?
To be eligible for the non-first-time homebuyer tax credit, you must meet all of the first-time homebuyer eligibility requirements except for the rules about previous homeownership and purchase dates. In place of those rules, you must:
have owned and lived in your previous home as your principal residence for at least five consecutive years of the eight years before the purchase
buy a single-family principal residence in the U.S. after November 6, 2009, sign a binding sales contract before May 1, 2010, and close before July 1, 2010.
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Are there special rules for people in the military?
People serving in the military on extended duty outside the U.S. for 90 days or more have an extra year, through June 2011, to buy a house and claim the tax credit.
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How do I get the homebuyer tax credit?
You do not get the tax credit when you close on your house. You get the tax credit when you file your federal income taxes for the year 2008, 2009, or 2010, depending on when you buy your home.
For homes bought in 2008, you claim the credit on your 2008 tax return or amended 2008 tax return.
For homes bought in 2009, you can:
claim the credit on your 2009 tax return
file an amended 2008 tax return to claim the credit
For homes bought in 2010, you can:
claim the credit on your 2009 tax return filed by April 15, 2010
file an amended 2009 tax return to claim the credit
or claim the credit on your 2010 tax return
Eligible homebuyers with MassHousing mortgages can borrow against the tax credit without interest to pay their down payment or closing costs. See MassHousing Homebuyer Tax Credit Loan Program.
The 2008-2009-2010 homebuyer tax credits are refundable credits that can lower the amount of federal income taxes you owe or give you a cash payment:
If your credit is less than you owe in taxes, the credit lowers your tax liability dollar for dollar
If your credit is more than you owe in taxes, the government pays you the difference
If you do not owe any federal income tax, the government pays you the full credit amount
You must file a federal income tax return to get the credit, even if you don't owe any income taxes.
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Do I have to pay back the credit?
If the tax credit is for a home you bought in 2008, you must pay back the credit. If the credit is for a home you bought in 2009 or 2010, you do not have to pay back the credit in most cases.
2008 Homebuyer tax credit: You must start paying back the credit two years after the year you bought the house. You pay back the credit over a 15-year period as an additional tax on your tax return. If you claim a $7500 credit, for example, you must pay back about $500 per year. Note: The tax credit is basically a 15-year interest-free loan from the government.
If you stop living in the house as your primary residence, or if you sell the house before the 15-year repayment period is over, you must pay back the balance of the tax credit in full. In special situations, you do not have to pay back the full amount (for example if you do not make enough profit from the sale of the house to pay back the credit, or if the taxpayer dies).
2009-2010 Homebuyer tax credit: You do not have to pay back the credit as long as you own and live in the home as your principal residence for at least three years. If you sell the home before the three years are up, you must pay back the entire credit.
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What tax forms do I file?
Property tax deduction:
For the property tax deduction for homeowners who do not itemize, you enter the increased standard deduction on federal tax Form 1040 or Form 1040A. You do not file a special form.
The instructions for Forms 1040 and 1040A include a Standard Deduction Worksheet so you can calculate your standard deduction with the property tax deduction included.
First-time Homebuyer Credit:
To claim the First Time Homebuyer Credit, you must file Form 5405 with your federal tax return. You can get a copy of Form 5405:
by downloading the form from the IRS web site: 2008 Form 5405 - First-Time Homebuyer Credit (PDF)
or by calling the IRS at 1-800-829-3676 and asking them to mail Form 5405 to you
Note: 2009 forms are not yet available (see Draft of 2009 Form 5405)
For more information, see How to Get the Extended Home Buyer Tax Credit and How to Get the 2009 First-Time Home Buyer Tax Credit on the National Association of Realtors® web site.
Housing Tax Credit 2010 | |
|  October 2009 Market Report
The clock is ticking on the up to $8000 Tax credit for first time home buyers that will be ending soon. We are hopeful the Obama Administration will extend this great incentive into the New Year. Let your legislators know you want it to continue.
Well you can still get a bargain home or condo in the southwest Florida area. BUT it looks like the entry level bank owned home market has hit bottom and is seeing rising prices and multiple offers. In the Cape Coral Area many of the recent sales have been these homes being bought by both end users and investors. Few year old bank owned homes that are listed in the $60’s are commanding multiple offers, over list offers, and very few days on the market.
Today if that is what you are looking for be ready to decide right away. Have proof of funds or a mortgage prequalification ready. We are literally chasing new listings and helping our buyers determine how much over the asking price they need to bid.
Home inspections from reputable companies are critical on these homes.
The bank is generally selling AS/IS and some of these foreclosed homes need more repairs than the average person can afford to fix. Plus the issue of Chinese Drywall could ruin your newly purchased home. Our local inspectors are up to speed on the latest news on the subject and are quick to spot problems.
The rest of our market is wide open however.
Tremendous deals can be had on larger homes, gulf access canal pool homes, gated communities and golf course developments. Condos are a tremendous value.
As an example a luxury waterfront condo complex with amenities galore, behind our offices, was recently constructed a few years ago. Units were originally listed as high as $800’s are now being sold for $250k.
Regionally it’s the same in many newer developments that have an inventory of new homes and condos.
Probably the biggest bargain right now is land, which there not making any more of. Residential lots that sold for $90,000 just a few years ago can now be had for a few thousand dollars in Cape Coral. Freshwater canal lots can be had for under $20k and some gulf access lots are under $100k. Unheard of prices.
So now is a great time to buy.
Come on down.
October 2009 Market Outlook | |
| SUMMER 2009 SOUTHWEST FLORIDA REPORT
Sales are up across the area as both investors and end users are scooping up the great deals on some of the foreclosed properties. Savvy buyers are starting to understand the way to a good deal. There was a period a few months ago when you could buy a foreclosed home in Cape Coral for under the bank’s asking price. Generally speaking those days are over.
Does a full price offer guarantee success in buying one of these homes?
No, not necessarily. Depending on the price range most properties under $100000 end up with multiple offers. It could be a bid of a few hundred dollars over the list price will get that home. The key is aligning with a Realtor who is able to advise you correctly. Time is critical as your dream home could be gone before you know about it. If you have a Realtor working for you, at no charge, they will be on top of new listings as they hit the market and identify homes that fit your specifications. Be ready to decide right away.
Of course you will already have a mortgage pre-approval in hand as required by all bank owned sales unless you are paying by cash. If that’s the case then you will need to provide proof of funds with your contract’s submission instead.
Does the bank prefer a cash offer over someone needing a mortgage? NO. They prefer the highest offer. Period. They are trying to obtain the highest price for one of their assets. If you are not preapproved your offer generally won’t be submitted to the bank for consideration.
If the listing says you must obtain pre-approval from a specific bank that is considered a RESPA violation. They are seen frequently in the confidential terms for Realtors in the MLS. That listing’s realtor can be in big trouble for publishing those terms. Yes you may require a pre-approval from a legitimate bank. No, they can not require you to go to a specific lender. A cynical person could conclude it’s just a way for unscrupulous mortgage officers to generate business. Again that’s where you’re experienced Realtor comes in to say no to that nonsense. Recently I confronted a fellow Realtor about this. His answer was he did not know it was illegal, but was just copying other listings. Sad. All he needed to do was call our free legal hotline if he had a question about legality.
But mortgage pre-approvals are easy to apply for and we recommend getting yours from whatever bank or credit union you have a relationship. It should also be free. You will still be able to shop around for the best rate but once you have the pre-approval in hand you are able to buy.
The period between 4/10/2009 and 7/08/2009 two thousand one hundred fifty four properties (single family, condos, townhomes etc.) were SOLD with the assistance of a Realtor. Of those 2154 properties only 421 were successful short sales. But 1200 were properties that were foreclosure sales. The remaining 533 were average people successfully selling in this buyers market. They should be congratulated for pricing their properties according to market conditions. The days of “I’m not going to give it away” or “I need to add to the listing price to figure in negotiations” are over for now. It’s so important to price it correctly from the very beginning.
If you have not bought a home within the last 3 years you could qualify for up to $8000 government credit as a first time home buyer. And now that credit can be used for down payment assistance and help with closing costs. So don’t wait much longer as this credit is due to end in November. And interest rates are still very low.
Finally, visit our homes for sale section as we always have a nice selection of properties in all price points. If you don’t see your dream home there then visit our free MLS search for consumers. If you do register we will also sign you up for the more advanced automated LISTINGBOOK program you might have heard of. Everyone that has used it loves it. All we need is a name and email address to sign you up.
SUMMER 2009 | |
|  April Update
If you haven’t bought a home within the last 3 years please view the video on our home page.
It talks about the up to $8000 tax credit from Uncle Sam that does not have to be repaid.
There is an expiration on this so give us a call and don’t wait.
The news recently has been mixed.
Home sales in our area are up a whopping 97% from this time last year. Great news and that reflects all of those low priced foreclosure homes hitting our market. It’s amazing but some are just spending days on the market as investors have found a safe place for there dollars.
The other side of the coin is home prices have dropped 50% from this time last year. So sales are way up and prices are down .
The other news this month involves the Chinese drywall issue.
If your not familiar, during the building boom and after the hurricanes American drywall became hard to come by.
Builder had to look elsewhere for drywall and China had product at affordable prices.
Recently problems have arisen regarding Chinese drywall in home built between 2004 thru 2006.
Health issues include frequent bloody noses, breathing and respiratory problems and some home are too toxic to live in.
What are the signs to look for?
Remove a few face plates from some electrical switches. The wiring should look brand new. Do you see and black soot or any discoloring?
That could be a sign.
Another check is more involved and requires removing the cover to you’re A/C.
Again if you see black soot or discoloring on the coils it’s probably time to call a professional home inspector to confirm.
The other way to check is to get online and copy the numbers and letters written on the back of Chinese Drywall and climb up to the attic and see if you find these numbers.
If you confirm you have it call your insurance agency ASAP.
April 2009 Update | |
|  The improvement in sales from this time last year has made the headlines and maybe your selling your home and wondering what’s going on.
You really haven’t seen an increase in visitors to your home and you might be wondering if something is not right with your listing.
It’s great sales have increased over the past year but I’m afraid the majority of home sales recently are bank or corporate owned property. Since banks aren’t in the business of owning homes they price these homes to sell within 30 days.
So it’s difficult for the average seller to compete pricewise with these bank owned homes. Fortunately, they are selling quickly and are making inroads into our huge inventory.
Some of these homes are barely lasting a week and the more that get back on the tax rolls the better.
But the average seller does have some advantages over the bank owned homes.
Is your home meticulously maintained inside and out?
Your competition, bank owned isn’t.
Are you including all your appliances?
Some of the banks homes are missing all the appliances.
Most important you are able to provide your buyer a general deed.
The bank is only offering a special warranty deed and consulting a lawyer regarding that is advised.
So hang in there sellers. Get your homes price right and make sure it shows impeccably. You only have one chance to make a first impression.
We are still absorbing the new bailout plan just introduced and it’s effect on struggling homeowners.
The advice here is wait a few days before calling your lender.
They are swamped at this point with calls.
We do know 1st time homebuyers can take advantage of an $8000.00 tax credit.
So if the low prices are not enough motivation this should help you decide to buy.
This is the opportunity of a lifetime and if you buy in certain areas of southwest Florida you could be eligible for up to 102% financing using the Dept. of Agriculture home loan program.
Call us for all your Real Estate needs at 239-656-4573.
We are able to offer the latest searching technology in Listing Book FOR FREE.
Just give us your name and email and we will sign you up for this great program.
MARCH 2009 OUTLOOK | |
|  Technology marches on no mater how our comfort level is with it. Fortunately, some of the newer programs made available for consumers now are quite user friendly and make searching for real estate almost simple.
We are proud to be able to offer a new program called Listing Book FREE to anyone who wants to sign up.
It allows a consumer to search for property and have the same information available as us as a Realtor with the exception of the confidential or private information only we have access to. In addition, anyone familiar with our office knows we are not pests in calling once we have your information. Generally, we wait for you to call us.
But about Listing Book and why you should contact us to sign up for it. First, all we need is your name and email to get you up, and running. Then this user-friendly program takes over.
It will send you a welcome email and walk you through setting up an account specific to your needs.
Are you thinking of buying? Then you can set up Listing Book to search specifically for your dream home. Zero in on a specific area or neighborhood. Tighten up your price range. How many bedrooms? You can be as specific as you would like with this program.
Do you just want to search out foreclosure properties? Or how about just lots and land. Then you will like this program. In addition, you do not need to be a computer wiz to figure this program out. It’s very user friendly.
Are you thinking of selling or are already selling your home with us. This program is a great way to know automatically about your competition. How much is that home down the street? Or know when that house around the corner comes on the market before I even know.
We are offered new programs to make our job easier all the time.
Most of them turn out to be useless or more work than necessary. However, we and our customers that have tried it really like this software. Email us today and we will set you up with it, free.
The other bit of technology we have decided to offer now is video for all our home sellers.
The internet is now looking for video content to display (internet 2.0) and those that are not using it will be left behind. The days of virtual tours are winding down and just simple video tours of a home are the wave of the future.
We are getting better at it and eventually we will offer narrated video tours too. Nevertheless, the theory is the longer you can keep consumers on your web site or looking at a particular listing the better. In addition, most of the home searches engines that we link to put listings with pictures and video content first.
So technology does march on.
However, for Assist-2-Sell Sellers & Buyers Advantage Realty it has to make sense, be cost effective, be easy to use, and be consumer friendly.
FEBUARY UPDATE | |
|  With the parking lots filling up all over the area , traffic increasing, and restaurants having to hand out pagers again it seems to be Snow bird season in our area once again.
We have been anticipating the arrival of our friends from the north for months. I hope that they have heard about our great real estate prices and values. And with interest rates as low as they are now we are hopeful for a great season.
Sales from November 2007 compared with sales of November 2008 are up 67%. Of course, the great number of bank owned property accounted for most of this surge. And why not? Banks are in the money business, not owning and maintaining real estate, and foreclosed homes are flying off the shelves so to speak. With our northern neighbors, finally here we think they will get in on some of the great deals available.
The Baby Boomers will be retiring over the next decade or so and why not live the active lifestyle our area has to offer. There are dozens of golf courses in the area and waterfront living is also affordable for many.
However, fine homes that are fairly new are available for under $100,000 throughout this area. Brand new homes in Cape Coral, Fort Myers, North Fort Myers and Lehigh Acres can be had for a fraction of their original price.
Our returning snowbirds to Cape Coral will immediately notice many changes to the area. Travel Pine Island Rd. and you will find many more choices for dining and shopping since you last visited. It really has become the center of the city and instead of having to travel over one of the bridges to dine or shop, stay right here in Cape Coral.
If you do decide to travel over the bridge, make your way to Coconut Point. It has become a destination area. Multiplex movie theaters, shopping, and fine dining. Condominiums have been incorporated in the design so it is possible to live, work, shop and play without ever starting your car. Its design and idea has been quite successful and I am sure it will be copied.
Being a Red Sox fan, I am excited with the news of the old towne team staying in our area for years to come. Much like the Fenway Park neighborhood in Boston is a destination, even when there are no games, our Fenway South will be a year round attraction. Preliminary plans are exciting and with plans for a world-class aquatics center, shopping, housing and hotels.
So the snowbirds from Red Sox Nation now is the time to buy a home down here for now and the future.
Here’s hoping for a happy and healthy new year for ALL!
January 2009 update | |
|  DECEMBER UPDATE
The experts say the economic outlook for our area is bleak. Unemployment continues to grow and consumer spending obviously has been affected. Real Estate, once thought a never-ending source of growth has entered a record-breaking decline locally.
That said, interest rates for a 30 year fixed conventional loan are hovering around 6% and the USDA 102% home financing has just been refunded for another year. That home you have been keeping a watch on its price just dropped.
A good sign that we are near the bottom of this terrible cycle is the investor dollars are back. No longer feeling safe in the volatile stock market we are seeing more and more investors returning to real estate.
And why not. Lot prices are back down to where they were before the boom and foreclosed homes are just spending days on the market. Lee County has invited some retired judges back to help with the backlog of these foreclosure properties and are considering online auctions for these homes as a way to get them off the books and into tax paying hands. It is a painful process for the homeowners involved but it has to happen for our market to rebound.
The federal bailout will not help too many families in this county. If you have a second mortgage or home equity line, you do not qualify. But if you are facing foreclosure, the good folks at hopenow.com can be a good source of advice.
Our office can help you with a short sale if that is your chosen path but we advice working with your bank on a loan modification first or ask for forbearance, a period of time you do not have to make payments.
What if you just need or want to sell your home? Well you are competing with all of the foreclosed properties and short sale homes. So it is even more important than ever in pricing your home correctly and forget the old ways of anticipating a price negotiation and adding that amount on to your asking price. It will not get bodies into your home because of the intense competition. I could rent a plane with a banner saying look! Home for sale but unless it is priced right, your home is invisible.
Buyers we have been finding bargains for our home buyers for months now and if you call our office, we will help you find them too. Be aware though that if you want to buy a foreclosed home or a short sale property you must submit a preapproval letter from a lender with your offer. We can recommend several lenders for that necessary step. But now’s the time to buy and we can make it easy for you.
Team Assist2Sell Sellers & Buyers Advantage Realty wants to wish all our past, present and future customers a happy and healthy holiday season. May all your dreams come true.
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|  Besides our website where can you expect to see your property marketed?
Your home will be listed in
Yahoo Homes For Sale,
Google Base,
Oodle,
Trulia,
and AOL Real Estate.
If you choose our MLS for less program your will also find your property in both the local, regional and statewide MLS.
Then your property is sent to Realtor.com the world’s most popular search engine for Real Estate. We also pay extra to showcase your listing in Realtor.com that brings your property to the top of the listings, a featured listing. It’s an expense a lot of other companies do not incur but we believe it is quite valuable to our customers.
Your property is also available to be seen on :
Lycosclassifieds.com
Backpage.com
Walmart.com/classifieds
Local.com
Military.com
Homescape.com
Hotpads.com
Vast.com
CLRsearch.com
Lakehomesusa.com
Riverhomesusa.com
Oceanhomes.com
Myrealty.com
Propbot.com
Properazzi.com
Zillow.com
Frontdoor.com
We never know where a buyer will find your home so we submit to as many as possible.
Just like you might be comfortable searching for something on Google, I might prefer Yahoo.
Recent calls from Canada, London, and even from a soldier in Iraq confirms for us the importance of all our marketing for our customers, both buyers and sellers.
The days of a quarter inch picture of your home in the newspaper are over.
Today 78% of home searches begin on the internet. And the more content the better for buyers.
The next technology to become common is video and we will begin to offer that very soon.
OCTOBER UPDATE | |
|  Market update for fall 2008
I will start with our local market’s fundamentals and hopefully you will see some good news from these numbers.
The year 2007 was this area’s worst in 1-year home price change. Prices dropped 21.5% during 2007.
The numbers are improving for this year and the forecasted change in home prices for 2008 is -18.1%.
The good news is the forecasted change in home prices for 2009 is predicted at -6.8%. That is a good sign of our market prices starting to stabilize next year.
Prices are quite good now for buyers today though. What we are seeing is well priced foreclosed properties selling very quickly and the days of multiple offers are back for some of these homes.
Recently working with a buyer, we have been finding his choices are being snapped up as the hit the market. One home he especially liked had multiple back-up contracts on it.
So buyers if you see the home you like don’t wait too long to decide. You might loose your opportunity.
The short sales continue to dominate our market. The banks still are not staffed correctly to handle the glut locally and delays on submitted contracts to lenders are causing frustrated buyers to walk away from some of these short sales.
Some lenders are now asking the short sale seller to agree to sign significant promissory notes for the banks agreement to the short sale. It is just another part of our negotiations now on behalf of our short sale clients. However, from the lenders perspective it is still cheaper to agree to a short sale than foreclose on a property.
Buyers it is now time to buy lots again in Cape Coral and surrounding areas. Prices are extremely low in some areas and lots in the Cape for an average freshwater building lot can be had for as little as $15,000. There are also a significant number of short sale and foreclosure lots that can be picked up for a fraction of their price of a few years ago.
Chances are if you are buying then you will need to borrow money. Less than 10% of sales are strictly cash. Lender requirements are becoming quite strict and it’s routine now for loan to be re-examined in underwriting right before closing. However, deals are being done.
Our own selection of homes for sale currently offers almost everything a buyer could be looking for. Beautiful pool homes, some with gulf access, all aggressively priced for today’s market.
We have a fixer upper and short sale homes. Kim, our Broker assistant is in constant contact with the lenders involved in our short sales. Communication is the only way to complete a short sale and Kim is a tremendous asset for us.
We get quite a few calls for people looking for lease/option opportunities and we are happy to assist you in finding the right situation. We generally do not handle rental properties but our agents will be happy to help renters find the right rental. Just give us a call.
As always, if you would like to know the current market value of your property give us a call or email us. There is never any obligation and it’s free. We work mainly in LEE County however; we have traveled to GLADES, COLLIER and Charlotte counties to help buyers and sellers. Remember we are available everyday and the only number you need is 239-656-4573.
Fall 2008 Update | |
| 
Are we beginning to see the beginnings of a recovery in our local Real Estate Market?
I think it’s too soon to tell but these numbers look encouraging.
Within the last 30 days, 813 homes have sold with the assistance of a Realtor.
Of those 813 properties sold, 103 were short sales and 111 were bank owned foreclosed properties.
The area of this MLS covers the area from Naples to Port Charlotte but mainly concentrates on LEE County.
Cape Coral, Fort Myers, North Fort Myers, Fort Myers Beach, Lehigh Acres, Bonita and Estero are the main communities covered.
What it means I think is despite all the bad news we hear, it seems almost daily, that the average homeowner is still selling the majority of homes.
Yes, the short sales and bank owned properties are a factor.
But the average Joe still has a chance to sell his or her home.
Priced correctly, they can compete with some of the bargain priced short or foreclosed homes.
It can take 4 months or longer sometimes to buy a short sale home and the bank can always say no right up until the very end. Although foreclosed homes can be purchased in a similar period as an average home, some of these homes are not the best deals. Missing appliances, A/C, plumbing, windows and more these home should only be bought by the experienced.
Now I’m not saying last month’s sales made much of a dent in our bulging inventory of homes, condos, townhomes, duplexes and other types of multi-family homes. It hasn’t. I am saying that Mr. and Mrs. Homeowner have a chance to sell in this market now.
Priced right and you have a chance.
Are you pricing your home to anticipate negotiations?
That is a costly mistake.
Most of your competition is priced correctly so your $10,000+ cushion for negotiations makes your home invisible to a potential buyer.
They have too many correctly priced homes to view. Bite the bullet and forget that tactic. It only works in a sellers market.
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Consider that some in the mortgage industry were writing 2 year adjustable rate mortgages for the sub prime market until August 2007.
Those mortgage rates will adjust up until August of 2009. I don’t have the numbers on how many sub primes with a 2 year arm were written in 2007 but it was still common.
If you had good credit you probable chose a fixed rate or even a 5 year ARM . Those that have the 2 year arm will probably need to pay special attention to the new recovery bill just passed by the President this week.
Although a voluntary program for the banks, this bill can be helpful to a small portion of our neighbors.
Have a home equity loan or second mortgage? You don’t qualify until those notes have been satisfied.
Our contacts in the mortgage industry are still trying to digest this 600+-page law but early reviews say it’s too little, too late. Check with your bank for any news of their joining other lenders to offer some home owner assistance.
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Buyers, the fixed rates today for a 30 year mortgage with someone with a 720 credit score is right around 6.25%.
Great, I think.
The VA and USDA Loans offer low down payments and fixed rates.
Give us a call and we will be happy to recommend some mortgage professionals that will qualify you for a mortgage, if possible. If you don’t qualify today don’t worry. They will also provide the tools to turn your credit around in months. Also some home sellers are offering lease to own deals for the right person. So you can and should take advantage of today’s market.
REMEMBER WE HAVE AGENTS AVAILABLE EVERY DAY…
CALL 239-656-4573
AUGUST 2008 UPDATE | |
|  JULY 2008 UPDATE
Our local Real Estate Market continues to be a buyer's wonderland with a still huge inventory of homes, condos/townhomes, and vacant lots for sale. With interest rates at really affordable levels, we are in a unique time for buyers that won't last forever, it's time to buy now. Jim Cramer, the stock market guru who debated successfully against the President of the National Association of Realtors about the efficacy of buying a home 6 months ago, just visited the Larry King show on CNN.
He now says buyers have a 9-month window to take advantage of this market. And that you should buy now. Although prices might drop a little more, will interest rates remain affordable?
Today we have approximately an 11-month supply of homes nationally . Today on our market there are 17,626 homes for sale and 8087 vacant lots for sale. If 10,000 people move to LEE County each year then we have at least a 17 month supply. A 6-month supply means it is still a buyers market, so we have many homes for sale. But the latest numbers from May show sale up 2% from last May and hopefully a bottom of our market soon.
A sizable portion of our local inventory unfortunately is foreclosed property. And it will be for quite some time. Buyers can get a great deal on these bank owned homes. I recently helped a couple buy a brand new home in a gated community that was bank owned. We negotiated a great price that was significantly under the market price for a similar home in this community. They moved in with instant equity.
Sometimes though the bank owned property might not be such great a deal at all. Some of these properties have been neglected for months even before foreclosure and ALL are sold AS/IS. Many are missing appliances or need significant repairs. That is why representation of a Realtor is so important. From searching out the deals from the rejects to guiding you through an important transaction, the free services of a skilled Realtor for a buyer is quite important.
A comment I've heard from some buyers is I'd rather just call the number on the sign than work with just one Realtor. Not a very efficient plan if you were to ask me. Finding someone you can trust to guide you through everything involved in that purchase is more important than calling to get a door unlocked, if you are a serious buyer and not a Looky Lou. Now, maybe you purchased dozens of homes throughout the years and know the process well. A Realtor with hundreds of transactions under the belt can still be of service to you.
You might find after seeing some of these foreclosed homes (R.E.O.) you are better off buying a home from a traditional seller who is so grateful for your interest. Home sellers today are also aware of market conditions and generally are willing to negotiate with respectful offers. Financing seems easier today than several months ago as the lending community adjust to tougher requirements and guidelines. Good news is right on our web site's front page with the new loan programs from the USDA. FHA loans are more common now too. Owner financing and lease to own homes are easier to find these days.
Finally, if you look at purchasing your home as a long-term investment you should do well. This dip in our market is temporary and eventually we will be back to a more even market and yes, eventually a sellers market again. Don’t wait. The time to buy is now.
For all the Boomers who want to retire here, my advice is this. Our shiny new airport has direct flights from most major cities. Give us a call and tell us when and how long you can come down.
We will find that dream home for you.
Condo?
Gated Community?
Golf course?
Waterfront?
Swimming pool?
Or all or some of the above.
Do not miss out on this unique time.
Boston Red Sox or Minnesota Twins fans can buy that spring training condominium at unheard of prices.
We are close enough for day trips to Tampa for Busch Gardens and Orlando for the Disney World and Universal Studios and all the amusement parks and attractions for the kids and grandchildren.
Close by too are the cruise ship terminals that make cruising more affordable for us Floridians.
And for the big kids we now have Vegas type casinos as close as an hour away in a small town nearby called Immokalee. Or travel to Tampa or Fort Lauderdale for a night at their casinos.
World class saltwater fishing as well as freshwater fishing, happens all over this part of Florida. In addition, let's not forget year round golf.
Florida Gulf Coast University, www.fgcu.edu is becoming quite well regarded and Edison College, www.edison.edu is now offering Bachelor Degree Programs.
You can also check out our local school systems and charter schools from this web site.
Minor league hockey and baseball are an inexpensive evening's entertainment as well as 2 arena football teams.
The Barbara Mann Center offers us year round entertainment and there are several dinner theaters locally too.
Of course our restaurants feature the freshest seafood but every type of dining experience is offered in this area.
Shoppers have multitudes of choices in malls now with the recent opening of Coconut Point.
So, for the other 49 states come on down!
And, as former Florida Keys residents, we say to all our friends and neighbors….Come on Up!
JULY 2008 Update | |
| 
The Critical Role of the REALTOR® at Assist-2-Sell Sellers & Buyers Advantage Realty
Listed here are some of our typical actions, research steps, procedures, processes and review stages in a successful residential real estate transaction that are normally provided by Assist-2Sell Sellers & Buyers Advantage Realty in return for their sales commission. Depending on the transaction, some may take minutes, hours, or even days to complete, while some may not be needed. More importantly, they reflect the level of skill, knowledge and attention to detail required in today’s real estate transaction, underscoring the importance of having help and guidance from someone who fully understands the process – a REALTOR®.
And never forget that REALTORS® are pledged to uphold the stringent, enforceable tenets of the REALTOR® Code of Ethics in their professional dealings with the public. Not every real estate licensee holds REALTOR® membership. Make sure yours does!
Pre-Listing Activities
1 Make appointment with seller for listing presentation
2 Send seller a written or e-mail confirmation of listing appointment and call to confirm
3 Review pre-appointment questions
4 Research all comparable currently listed properties
5 Research sales activity for past 18 months from MLS and public records databases
6 Research "Average Days on Market" for this property of this type, price range and location
7 Download and review property tax roll information
8 Prepare "Comparable Market Analysis" (CMA) to establish fair market value
9 Obtain copy of subdivision plat/complex lay-out
10 Research property's ownership & deed type
11 Research property's public record information for lot size & dimensions
12 Research and verify legal description
13 Research property's land use coding and deed restrictions
14 Research property's current use and zoning
15 Verify legal names of owner(s) in county's public property records
16 Prepare listing presentation package with above materials
17 Perform exterior "Curb Appeal Assessment" of subject property
18 Compile and assemble formal file on property
19 Confirm current public schools and explain impact of schools on market value
20 Review listing appointment checklist to ensure all steps and actions have been completed
Listing Appointment Presentation
21 Give seller an overview of current market conditions and projections
22 Review agent's and company's credentials and accomplishments in the market
23 Present company's profile and position or "niche" in the marketplace
24 Present CMA Results To Seller, including Comparables, Solds, Current Listings & Expireds
25 Offer pricing strategy based on professional judgment and interpretation of current market conditions
26 Discuss Goals With Seller To Market Effectively
27 Explain market power and benefits of Multiple Listing Service
28 Explain market power of web marketing, IDX and REALTOR.com
29 Explain the work the brokerage and agent do "behind the scenes" and agent's availability on weekends
30 Explain agent's role in taking calls to screen for qualified buyers and protect seller from curiosity seekers
31 Present and discuss strategic master marketing plan
32 Explain different agency relationships and determine seller's preference
33 Review and explain all clauses in Listing Contract & Addendum and obtain seller's signature
Once Property is Under Listing Agreement
34 Review current title information
35 Measure overall and heated square footage
36 Measure interior room sizes
37 Confirm lot size via owner's copy of certified survey, if available
38 Note any and all unrecorded property lines, agreements, easements
39 Obtain house plans, if applicable and available
40 Review house plans and make copy
41 Order plat map for retention in property's listing file
42 Prepare showing instructions for buyers' agents and agree on showing time window with seller
43 Obtain current mortgage loan(s) information: companies and & loan account numbers
44 Verify current loan information with lender(s)
45 Check assumability of loan(s) and any special requirements
46 Discuss possible buyer financing alternatives and options with seller
47 Review current appraisal if available
48 Identify Home Owner Association manager if applicable
49 Verify Home Owner Association Fees with manager - mandatory or optional and current annual fee
50 Order copy of Homeowner Association bylaws, if applicable
51 Research electricity availability and supplier's name and phone number
52 Calculate average utility usage from last 12 months of bills
53 Research and verify city sewer/septic tank system
54 Water System: Calculate average water fees or rates from last 12 months of bills )
55 Well Water: Confirm well status, depth and output from Well Report
56 Natural Gas: Research/verify availability and supplier's name and phone number
57 Verify security system, current term of service and whether owned or leased
58 Verify if seller has transferable Termite Bond
59 Ascertain need for lead-based paint disclosure
60 Prepare detailed list of property amenities and assess market impact
61 Prepare detailed list of property's "Inclusions & Conveyances with Sale"
62 Compile list of completed repairs and maintenance items
63 Send "Vacancy Checklist" to seller if property is vacant
64 Explain benefits of Home Owner Warranty to seller
65 Assist sellers with completion and submission of Home Owner Warranty Application
66 When received, place Home Owner Warranty in property file for conveyance at time of sale
67 Have extra key made for lockbox
68 Verify if property has rental units involved. And if so:
69 - Make copies of all leases for retention in listing file
70 - Verify all rents & deposits
71 - Inform tenants of listing and discuss how showings will be handled
72 Arrange for installation of yard sign
73 Assist seller with completion of Seller's Disclosure form
74 "New Listing Checklist" Completed
75 Review results of Curb Appeal Assessment with seller and provide suggestions to improve salability
76 Review results of Interior DĂ©cor Assessment and suggest changes to shorten time on market
77 Load listing into transaction management software program
Entering Property in Multiple Listing Service Database
78 Prepare MLS Profile Sheet -- Agents is responsible for "quality control" and accuracy of listing data
79 Enter property data from Profile Sheet into MLS Listing Database
80 Proofread MLS database listing for accuracy - including proper placement in mapping function
81 Add property to company's Active Listings list
82 Provide seller with signed copies of Listing Agreement and MLS Profile Sheet Data Form within 48
hours
83 Take additional photos for upload into MLS and use in flyers. Discuss efficacy of panoramic photography
Marketing The Listing
84 Create Internet ads with seller's input
85 Coordinate showings with owners, tenants, and other Realtors®. Return all calls – weekends included.
86 Install electronic lock box if authorized by owner. Program with agreed-upon showing time windows
87 Prepare mailing and contact list
88 Generate mail-merge letters to contact list
89 Prepare E campaign
90 Prepare flyers & feedback faxes
91 Review comparable MLS listings regularly to ensure property remains competitive in price, terms,
conditions and availability
92 Prepare property marketing brochure for seller's review
93 Arrange for printing or copying of supply of marketing brochures or fliers
94 Place marketing brochures in all company agent mail boxes
95 Upload listing to company and agent Internet site, if applicable
96 Upload listing to major and minor home selling sites
97 Advise Network Referral Program of listing
98 Provide marketing data to buyers coming through international relocation networks
99 Provide marketing data to buyers coming from referral network
100 Provide "Special Feature" sign riders , if applicable
101 Submit ads to company's participating Internet real estate sites
102 Price changes conveyed promptly to all Internet groups
103 Reprint/supply brochures promptly as needed
104 Loan information reviewed and updated in MLS as required
105 Feedback e-mails/faxes sent to buyers' agents after showings
106 Review weekly Market Study
107 Discuss feedback from showing agents with seller to determine if changes will accelerate the sale
108 Place regular update calls to seller to discuss marketing & pricing
109 Promptly enter price changes in MLS listing database
The Offer and Contract
109 Receive and review all Offer to Purchase contracts submitted by buyers or buyers' agents.
110 Evaluate offer(s) and prepare a "net sheet" on each for the owner for comparison purposes
111 Counsel seller on offers. Explain merits and weakness of each component of each offer
112 Contact buyers' agents to review buyer's qualifications and discuss offer
113 Fax/deliver Seller's Disclosure to buyer's agent or buyer upon request and prior to offer if possible
114 Confirm buyer is pre-qualified by calling Loan Officer
115 Obtain pre-qualification letter on buyer from Loan Officer
116 Negotiate all offers on seller's behalf, setting time limit for loan approval and closing date
117 Prepare and convey any counteroffers, acceptance or amendments to buyer's agent
118 Fax copies of contract and all addendums to closing attorney or title company
119 When Offer to Purchase Contract is accepted and signed by seller, deliver to buyer's agent
120 Record and promptly deposit buyer's earnest money in escrow account.
121 Disseminate "Under-Contract Showing Restrictions" as seller requests
122 Deliver copies of fully signed Offer to Purchase contract to seller
123 Fax/deliver copies of Offer to Purchase contract to Selling Agent
124 Fax copies of Offer to Purchase contract to lender
125 Provide copies of signed Offer to Purchase contract for office file
126 Advise seller in handling additional offers to purchase submitted between contract and closing
127 Change status in MLS to "Sale Pending"
128 Update transaction management program to show "Sale Pending"
129 Review buyer's credit report results -- Advise seller of worst and best case scenarios
130 Provide credit report information to seller if property will be seller-financed
131 Assist buyer with obtaining financing, if applicable and follow-up as necessary
132 Coordinate with lender on Discount Points being locked in with dates
133 Deliver unrecorded property information to buyer
134 Order septic system inspection, if applicable
135 Receive and review septic system report and assess any possible impact on sale
136 Deliver copy of septic system inspection report lender & buyer
137 Deliver Well Flow Test Report copies to lender & buyer and property listing file
138 Verify termite inspection ordered
139 Verify mold inspection ordered, if required
Tracking the Loan Process
140 Confirm Verifications Of Deposit & Buyer's Employment Have Been Returned
141 Follow Loan Processing Through To The Underwriter
142 Add lender and other vendors to transaction management program so agents, buyer and seller can
track progress of sale
143 Contact lender weekly to ensure processing is on track
144 Relay final approval of buyer's loan application to seller
Home Inspection
145 Coordinate buyer's professional home inspection with seller
146 Review home inspector's report
147 Enter completion into transaction management tracking software program
148 Explain seller's responsibilities with respect to loan limits and interpret any clauses in the contract
149 Ensure seller's compliance with Home Inspection Clause requirements
150 Recommend or assist seller with identifying and negotiating with trustworthy contractors to perform
any required repairs
151 Negotiate payment and oversee completion of all required repairs on seller's behalf, if needed
The Appraisal
152 Schedule Appraisal
153 Provide comparable sales used in market pricing to Appraiser
154 Follow-Up On Appraisal
155 Enter completion into transaction management program
156 Assist seller in questioning appraisal report if it seems too low
Closing Preparations and Duties
157 Contract Is Signed By All Parties
158 Coordinate closing process with buyer's agent and lender
159 Update closing forms & files
160 Ensure all parties have all forms and information needed to close the sale
161 Select location where closing will be held
162 Confirm closing date and time and notify all parties
163 Assist in solving any title problems (boundary disputes, easements, etc) or in obtaining Death
Certificates
164 Work with buyer's agent in scheduling and conducting buyer's Final Walk-Thru prior to closing
165 Research all tax, HOA, utility and other applicable prorations
166 Request final closing figures from closing agent (attorney or title company)
167 Receive & carefully review closing figures to ensure accuracy of preparation
168 Forward verified closing figures to buyer's agent
169 Request copy of closing documents from closing agent
170 Confirm buyer and buyer's agent have received title insurance commitment
171 Provide "Home Owners Warranty" for availability at closing
172 Review all closing documents carefully for errors
173 Forward closing documents to absentee seller as requested
174 Review documents with closing agent (attorney)
175 Provide earnest money deposit check from escrow account to closing agent
176 Coordinate this closing with seller's next purchase and resolve any timing problems
177 Have a "no surprises" closing so that seller receives a net proceeds check at closing
178 Refer sellers to one of the best agents at their destination, if applicable
179 Change MLS status to Sold. Enter sale date, price, selling broker and agent's ID numbers, etc.
180 Close out listing in transaction management program
Follow Up After Closing
181 Answer questions about filing claims with Home Owner Warranty company if requested
182 Attempt to clarify and resolve any conflicts about repairs if buyer is not satisfied
183 Respond to any follow-on calls and provide any additional information required from office files.
Reprinted from the Orlando Regional Realtor Association.
June 2008 Update-What did we do today? | |
|  May Update
Good news travels fast.
Recently a prominent real estate Broker in Fort Myers had a wonderful few weeks.
Selling dozens of homes and townhomes in Coral Lakes, a new gated community in north Cape Coral, at what were unheard of prices.
Lines of anxious buyers formed outside the sales center waiting to buy now.
It made the national news as our national housing crisis looks for good news and signs of recovery.
A seller of mine was in North Carolina at the time and he heard about the Coral Lakes sale from someone who was thinking of getting in on a good thing.
We lost one of our buyers to this sale. Tired of waiting to hear whether an unresponsive lender would accept his offer on a short sale property, he got in line and was one of the lucky ones who bought a townhome. Although it’s a potential sale we missed, this buyer was always extremely cooperative and cordial and we are genuinely happy for him.
And for the lucky few who got the deal of a lifetime.
So like spring flowers starting to bloom, signs of a recovery are slowly starting to show.
The record drop in new housing starts is helping to make inroads in our huge resale inventory.
Finally sellers are becoming more realistic in pricing their homes properly.
Once our inventory of resale’s slowly shrink then our local builders can get back to work building new homes.
I don’t think we can expect the new home builders to continue marking down their inventory much more though.
Because of this historic financial tremor, lending rules for mortgages are quite strict.
Most buyers will need at least 5% down now with a decent credit score but there is still help for low-income first time buyers.
Located in our building, for example, is the local office of the USDA. They offer many opportunities for our lower income population to buy or build homes in unincorporated areas.
I would suggest a call to see if you qualify. You might be surprised.
This is just one example of several programs available with one of several sources.
Since all the foreclosures have not hit the market our recovery will be slow.
But we are starting to see more buyer activity recently and anyone who is trying to time the absolute bottom of the market is foolish. Mortgage rates are under 6% for a 30 year fixed rate and the selection of homes has probably peaked.
Like a few years ago when we would hear from old timers who would say I could have bought that gulf access lot for $5000.
Buyers don’t miss this moment in history.
You will never have to say Shoulda, Coulda, Woulda……..
MAY 2008 UPDATE | |
|  A Different Approach to Revitalizing the Housing Market
THIS MONTH'S UPDATE was written by Lyle Martin, co-founder and co-chief executive of Assist-2-Sell, shares his thoughts on what it will take to get the housing market back on track.
While U.S. Federal Reserve rate cuts and the economic stimulus package are helpful, they aren’t enough to bring the economy back from the brink of recession. Some mortgage lenders’ decision to temporarily suspend the foreclosure process through “Project Lifeline” is encouraging but more drastic steps need to be taken to help a housing market that is obviously in trouble.
Few would disagree that the explosive growth in the housing market (prices and inventory) over the past several years was stimulated by lenders providing easy financing. As is typical with most major purchases, as financing becomes more affordable, an increase in demand will follow.
While it is easy to blame “subprime” lenders, that serves no useful purpose. In essence, they were simply satisfying a demand. When a homeowner gets in over their head, shouldn’t they be held responsible? Shouldn’t they have taken the time to understand what they were signing?
In reality, they are no more to blame than those who got caught up in the “dot com” stock speculating. Who wasn’t tempted to jump on board what appeared to be a never ending booming stock market? Watching home prices soar and the potential for homeownership start to escape the reach of the average consumer, who can blame people for jumping onboard before they were left behind?
Just like the stock market appeared to have no ceiling, the housing “bubble” appeared immune to bursting. Hindsight is 20/20 but just like the experts were unable to predict the crash of the housing market—and yes it is a crash—no one is able to predict the recovery. Of course there will be a recovery. Will it be in six months, two years or 10 years? The United States’ fragile economy cannot afford to wait for the market to self correct. The market was driven up by some creative artificial influences and it is going to take some of that same creativity to get it back on track.
-- Roll Back Home Prices
Today’s artificially inflated home prices need to be adjusted back down to a value more in line with the value of the dollar, adjusted for inflation. This means rolling back prices to where they were at before “funny money” flooded the market. Since home appreciation is not consistent in every area of the country, roll back will not be consistent. In some markets, very little price appreciation was experienced. Those areas don’t need to undergo a big adjustment. Other areas are even seeing normal appreciation. Some areas, like most of Florida, California, Arizona and Nevada, need major adjustments. They need to look at rolling back to pre-2003 prices, maybe even earlier.
Tough but necessary medicine. Lenders are already accepting this reality as they write off billions in loan losses and sell off foreclosed homes or negotiate short sales. Rather than have homeowners walk away from their homes, why not invite a compromise? Forgive a significant amount of the loan balance—essentially re-setting the loan more in alignment with the new value of the home—and let them keep the home.
-- Promote Responsible Homeownership
Give people willing to take on the responsibilities associated with homeownership some extra help. Yes, the responsibilities of homeownership. Let’s not make it so easy for first time homebuyers. Their first home may not be their dream home but whatever happened to delayed gratification? First time homebuyers need to be encouraged to start small and work their way up.
The government can play an important role by creating a new type of tax free savings account for first time homebuyers who want to save money for a down payment and closing costs. Money put into the account should be exempt from income tax. For example, if $10,000 is set aside in the account over a period of time, then the $10,000 (and all accrued interest) is not subject to income tax. Watch how fast people save up a down payment. Financial institutions will benefit from this influx of new savings, creating another source for mortgages besides Wall Street. Homebuyers will appreciate their investment more when some of their hard-earned dollars are put in as part of the purchase.
-- Extend Relief to Other Related Industries
The housing-related industries that are indirectly feeling the impact of the current housing market also need to be helped. Builders, landscapers, home improvement businesses, etc. Offer existing homeowners tax incentives for improving their homes. There is a lot of work that is needed on a lot of homes. New roofs; newer, more energy efficient heating and cooling systems; energy efficient windows; insulation, etc. This can help businesses as well as the environment.
-- Don’t Forget Rentals
Investing in rental real estate helps provide housing for those not interested or perhaps unable to purchase their own home. Increase tax benefits for improving existing properties and eliminate passive income limitations. Reintroduce the tax saving incentive of accelerated depreciation. Shorten the depreciable lifetime on properties. Loosen up the 1031 exchange rules to allow more time to move between investments.
-- Emphasize Responsible Spending
In addition to not saving, many are struggling just to make minimum payments on their credit cards. Consumers need help getting a better handle on their debt. First, remove the temptation. Restrict the deductibility of home equity loans used for consumer debt. The deductibility of home equity loans was just too tempting for people. They borrowed against their hard earned equity to finance cars and home entertainment systems. Financing cars for 30 years has got to stop. Restore usury rates. The rates people are paying on consumer debt are unconscionable. When payday loan stores outnumber McDonald’s, it is a sign a crisis is looming.
People need to be taught about more real world financial issues. Start in high school, maybe earlier. Kids need to understand that CDs don’t just play music. To help people get unburied, restore for a limited time period, the tax deduction on existing consumer interest (such as credit card and auto loan interest).
-- Encourage True Savings
Motivate people to save. Look what happened in 1974 when Congress enacted the Employee Retirement Income Security Act (ERISA). This Act created the Individual Retirement Account (IRA). It started out simple and was overwhelmingly successful. For many, it resulted in their first savings account ever. Trillions of dollars in assets have been accumulated and IRAs represent the largest component of the U.S. retirement market. With private sector businesses unable to provide the retirement programs, along with the challenges faced by Social Security, more attention needs to be paid to improving this system. Boost contributions to IRAs by restoring tax deductible contributions to IRAs for everyone.
The consequences of continuing on the same course can only be the same results. One definition of insanity is doing the same thing and expecting different results. The Fed lowering interest rates time and again is not going to fix this problem. The Fed rate could be lowered to zero and people still would not be able to afford to buy a home or make payments on the home they already own. Sending small checks to millions of people failed before. Why would it work now? These challenging times demand real solutions. Not Band-Aids.
About Lyle Martin
Real estate veteran Lyle Martin is one of the original founders of Assist-2-Sell Inc., a full-service discount real estate company. Started in 1987, there are now more than 550 franchise offices throughout the United States and Canada. Assist-2-Sell provides home sellers and homebuyers with full brokerage services for less money. On the Net: www.assist2sell.com.APRIL UPDATE | |
|  A few weeks ago an old friend, and loan officer, Olga Alfonso, stopped by our offices.
Excited with her new situation, she has associated with Expert Mortgage Group.
Her specialty and what gives her the most job satisfaction, is first time buyers, finding grants, and programs for our entry level buyers. She provides fast and accurate information to us 7 days a week.
This Bi-lingual local loan officer is a great resource for people exploring their options purchasing a home or refinancing. Contact her at 239-282-0749.
Our other local GO TO person for mortgages for our buyers and sellers looking to refinance is David Lang.
He is a mortgage loan officer with Fifth Third Bank.
David is quite a guy and has helped us and our buyers tremendously.
We highly recommend his services and he also answers every day.
Call him at 239-334-2055.
The importance of getting “pre-approved” for a mortgage is so important when you are starting to think of buying.
It is really the first step.
It’s a fairly painless process and once you have that in hand the whole real estate world takes you seriously.
The first reason to get it done is you are not guessing about how much home you can afford.
You will know the price range I should shop in for you.
You will have a very good idea of what not only your mortgage payments will be but also what you can expect to pay for insurance and taxes.
When we find your dream home that pre-approval letter is submitted with your offer.
It is presented to the seller and reassures that person of your ability to afford their home.
Most sellers will not entertain an offer without some proof of ability to pay. Why would they?
And the best part is there should be no cost to get pre-approved.
As with second opinions from doctors, repair services, and realtors as example it pays to shop around for you best deal regarding a mortgage.
A recent buyer was certain their credit union offered the mortgage program suitable for their needs. We convinced them to have Dave run the numbers too.
It turned out by going with Dave they were going to save money overall.
Olga has found our buyers obscure grants or programs that others might not find familiar.
Our associations with these professionals reflect on us.
If they and others we might recommend disappoint our clients, we are disappointed too.
_________________________________________________
It’s time to jump back in for real estate investors interested in our area. We can provide you with lists of foreclosed and short sale properties.
Identifying properties for investment , 1031 Tax exchange is something we can assist with.
Whether it’s a commercial building, raw land or residential income properties, we can help.
Call us at 239-656-4573.
MARCH 2008 UPDATE | |
|  PROJECT LIFELINE***2/14/2008***
Assist-2-Sell Sellers and Buyers Advantage Realty is encouraged by this week’s announcement that six of the nation’s largest mortgage lenders will reach out to homeowners most at risk of losing their homes through a new plan known as “Project Lifeline.” The Company is also pleased to see such strong support for the plan come from the White House, the U.S. Treasury and the Department of Housing and Urban Development.
Project Lifeline (www.hopenow.com) helps homeowners avoid foreclosure by temporarily suspending the foreclosure process for 30 days. The plan will initially involve Bank of America Corp., Citigroup Inc., Countrywide Financial Corp., JPMorgan Chase & Co., Washington Mutual Inc., and Wells Fargo & Co. Homeowners who are 90 days or more behind in payments on any type of mortgage, not just subprime loans, can use the extra time to work with their lenders on more affordable loan terms.
Vanessa & Robert Reardon, co-founders and owners of Assist-2-Sell Sellers and Buyers Advantage Realty., had these comments on Project Lifeline:
“We’ve all become so accustomed to seeing statistics about foreclosures and short sales and declining home prices. We have to remember that these aren’t just numbers. These are people; these are families. So it’s a good thing when steps are taken to help people on the brink of foreclosure. Any time you can keep someone in their home, it is good for the family; it is good for the community; it is good for the economy; and it is good for America.
“It’s unfortunate that so many homeowners are truly afraid they will lose the home they worked so hard to put over their head. They shouldn’t feel alone, though, and they shouldn’t avoid the problem. There really are options. We encourage homeowners who are in trouble with their mortgages to use this extra time to get help. They shouldn’t wait any longer. Resources, like Project Lifeline, are available to them. This extra time just might be enough to save their home.
“Project Lifeline is only a start, though. We hope these and other lenders will take their efforts further by making changes within their own organizations. Resources are tapped, which means foreclosures and short sales are piling up on people’s desks, homes are sitting on the market for months on end, interested homebuyers are walking away after weeks of waiting, and distressed homeowners are going further and further into debt. The longer mortgage lenders take to address their own problems, the longer recovery will take.”
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One of the constants of Real Estate is that market conditions are local. National, regional and statewide market conditions are important and do influence our local market.
If potential homebuyers, for example, from other parts of our country cannot sell their home, it directly affects sales locally.
However, our local market is affected more so by our local economy.
Jobs, taxes, mortgage rates, the price of gas, and our other costs of living have more of an impact on our local real estate market.
Whether you are thinking of buying or selling, the real estate professional you choose should be able to tell you the local market trends.
Where are the majority of sales taking place locally? In addition, what price range are sales taking place?
If we were to look at the greater Fort Myers, area as a whole the price range most buyers are buying is between $100-$200,000.
Sales are occurring in our other price ranges but the majority of recent sales since Thanksgiving fit into the under $200,000 range.
Where are those buyers buying specifically?
If you look at recent sales in Cape Coral, the areas where the transition to city water and sewer has happened remain popular. The neighborhoods along Del Prado, for example, had quite a few sales.
Nevertheless, the area north of Veterans Pkwy to Pine Island Rd, between Santa Barbara and Chiquita Blvd is the recent sales leader.
Over into Fort Myers, the area south of Colonial, east and west of Interstate 75 was the most popular area recently for sales.
Our neighbors in North Fort Myers saw the most sales recently in the area that abuts Business 41 to Interstate 75.
However, sales have happened in all our southwest Florida neighborhoods. Moreover, in all price ranges.
Trends of recent sales and neighborhoods that seem to be holding their price are some of the facts you should expect your Realtor to know and share with you.
At Assist-2-Sell Sellers and Buyers Realty, this is research we do routinely and have the necessary knowledge of our local market.
Give us a call at 239-656-4573.
We are available every day.
FEBRUARY 2008 Report | |
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