10 Clever Ways to Save Money on Your Mortgage

What’s your biggest expense? If you’re like most people, it’s putting a roof over your head. And it’s getting more expensive. In fact, the cost of housing is rising faster than incomes for the middle class, according to a National Housing Conference report. Renters may have the worst of it; the Wall Street Journal reports that rent has been rising for 23 consecutive quarters.

By buying a house, you have more control over rising housing costs. You won’t have to worry about a landlord raising the rent, and a fixed-rate mortgage loan guarantees the same principle-and-interest loan payment for the next 30 years. Yes, borrowing for a home is expensive. Fortunately, with a few smart strategies, you can reduce your monthly mortgage payments and cut the overall cost of paying for your home. Here are some options:

1. Modify Your Loan - If you are late on payments or going through tough times, you might qualify for a loan modification through various programs. Depending on the program, you could qualify for a reduced interest rate, forgiveness of part of the principal, or an extended loan period and lower monthly payment. Check out various programs on MakingHomeAffordable.gov or contact your mortgage servicer.

2. Cut Out the PMI - If you borrow more than 80% of the value of your home, you normally have to pay for private mortgage insurance (PMI) to protect the lender. PMI typically costs between .5% and 1% of the loan amount. So if your loan balance is around $140,000, you could be paying as much as $1,400 for PMI just this year. A down payment of 20% is the most obvious way to avoid paying for PMI. If this is tough with the homes you’re considering, Realtor.com suggests simply shopping for lower-priced homes for which you can make a 20% down payment. Multiply the down payment you have by five to arrive at the highest price you can pay while avoiding PMI.

Credit.com says some lenders still offer 80/10/10 programs. This structure allows you to borrow only 80% on the primary mortgage, so you don’t have to pay for PMI, and then borrow another 10% as a second mortgage loan — sometimes from the same lender. You generally need a credit score of 700 or higher to qualify. If you’ve already bought your home, you can speed up those payments to get the balance below 80%, and then request that the PMI payments be dropped. Lenders do not always agree to drop the insurance requirement, according to BankRate.com, but at that point you could also refinance to get rid of the PMI. The law says a lender has to drop the PMI at the point when you are scheduled to reach a balance of 78% of the home’s value at the time of purchase, as long as you’re making the payments on time. If you are at that point, check to make sure the PMI has been dropped.

3. Buy a Less Expensive Home - Buying a less expensive home not only opens up the possibility of a 20% down payment, which eliminates the cost of PMI, but it also reduces many other costs. Payments (and interest charges) will be lower on a smaller loan. In addition to the lower direct loan costs, you’ll save money on property taxes and insurance. If it’s a smaller house (not just cheaper), you may also save on maintenance and utilities.

4. Downsize - If you already own a house but want to cut costs, consider downsizing your home. You can reduce your payments, eliminate mortgage insurance and probably cut other expenses as well. Selling your house and buying a less expensive one works especially well if you have substantial equity, since you can put much of that toward the new home to keep the loan amount (and payments) lower.

5. Refinance Your Mortgage - Before you refinance, you have to be clear about your goal. Is it just lower payments you need, or do you want to lower your long-term costs? Or are you looking to do both? For example, if you have 13 years left on a 15-year, $140,000 loan at 4.5% interest, you owe about $126,000 and have payments of $1,071. A loan calculator shows that a new 30-year loan for that amount at 6% drops that payment to $839, or $232 less per month. The downside: You’ll pay $302,173 over those years, versus $167,076 if you stuck with the old loan and faster payoff. That’s $135,097 extra for the convenience of lowering your payments now. So do you want to pay less over the years or just have lower payments right now?

You also have to be careful about loan costs. Surprise fees are one of the primary complaints from borrowers, according to a recent survey. Apart from loan costs, you may have to pay for an appraisal, recording fees and taxes in some states. Ask lots of questions to determine as closely as possible what the total cost of refinancing will be. Once you calculate your cost to refinance, you can determine your break-even point using a refinance calculator. For example, with a current balance of $140,000 on a 30-year loan taken out in 2009 at 5%, refinancing at 4% with $2,500 in loan costs leaves you with a break-even point of 31 months. That’s when your savings in interest paid will have covered the costs of refinancing. If you move (and sell) before your break-even point, you’ll have lost money by refinancing. On the other hand, in this example, if you stay for another 30 years you’ll save $17,562 total — not bad for a few hours of paperwork.

6. Reduce Property Taxes - Although property taxes are not technically part of the loan, payments often include money that’s put into escrow to cover property tax bills and insurance. If you think your home is worth less than the assessor says, ask for a review. You might need to try a few tricks to getting the assessment changed and lowering your property taxes, but if you succeed your lender should adjust your payment to reflect the lower annual bill.

7. Buy Cheaper Insurance - If your mortgage payment includes an escrow amount for home insurance, you can get it lowered by finding a cheaper policy. Of course, even if it isn’t rolled into your house payment, you can save money by finding better insurance rates. Lenders have minimum requirements for homeowners insurance, so the policy you buy must meet their criteria.

8. Make Extra One-Time Payments - If you get a big tax refund or a gift or small inheritance, you can put a chunk of it toward your mortgage loan. If you pay an extra $1,000, the balance of your loan will be $1,000 lower than it would have been for every remaining month. For example, if the interest rate on your loan is 5%, you’ll save $50 in interest every year until you make the final payment. That adds up!

9. Make Regular Extra Payments - If you can afford to add more to your monthly payments, this is one of the surest ways to reduce your interest charges over the years. A loan payment calculator can show you how much you’ll save with regular extra payments. As an example, if you have 30 years to pay on $140,000 at 5%, and you add $356 monthly to your regular $751 payment, you’ll pay off that loan in half the time and save $80,000 in interest. Of course, you could also save on interest by getting a 15-year loan to start with. But by paying extra on a 30-year mortgage you get the same effect, and you can stop paying the extra amount if you run into financial difficulties.

10. Use Credit Card Offers - Do you ever get 0% interest credit card offers? If so, you can use them to reduce the mortgage loan interest you pay. For example, suppose you’re paying $400 extra monthly on your 5% mortgage loan and you can get a card with 0% interest for the first year and a 2% fee the convenience checks (often this is 3% or even 4%).

Here’s what you can do:
     Step 1: Write a check to your mortgage servicer for $5,000 (that’s approximately what those $400 payments add up to in a year) and pay the $100 fee.
     Step 2: Put the $400 that was going toward the loan into a savings account each month and pay the minimum on the credit card from it.
     Step 3: In a year (when the promotional rate ends), use the savings account to pay off the remaining balance on the card, and put the rest toward the mortgage loan. By using this strategy, you’ll earn interest in the savings account (1% in a good account, or as much as 3% in a Kasasa account). More importantly, you’ll reduce the loan balance by $5,000 right up front instead of spreading it out over the year. You’ll save $250 in interest charges (5% of $5,000) and make $25 to $50 from the savings account. Even after the $100 fee, you will have reduced your total cost by $175 to $200, which is more than the $46 you would have saved on interest by just paying the extra $400 monthly.

This form of credit card arbitrage is sometimes called “stoozing,” and is best done only if you’re very disciplined and organized. The penalties and interest from a late payment on the credit card, or from forgetting to pay it off in full after the 0%-interest period ends, will quickly wipe out any advantage gained.

Have you ever used one of these approaches, please comment and let us know how it helped!

Original Article Here - By Steve Gillman, Contributor

Risky Business: Marijuana Real Estate Boom or Bust?

The Denver Post recently did a story on how cannabis businesses are having to pay sky-high rents nationwide. In Portland, for instance, commercial real estate that typically rents for five dollars per square foot goes for three times that amount for cannabis businesses. Though rents for cannabis businesses in Washington and Colorado are stable, they are considerably higher than the lease rates for any other business, and real estate investors looking to lease to cannabis businesses are mostly betting this trend will continue.

Several things are pushing up cannabis rents, all of which decrease the available supply of cannabis real estate. The vast majority of commercial real estate mortgages contain a clause mandating that the property be used lawfully, but because marijuana remains federally illegal, a property with a cannabis business on it is not operating legally. This illegality entitles banks that hold the mortgage to deem their loan in default and to accelerate the principal so it’s all due immediately and to then foreclose if the borrower cannot find alternative financing to cover its outstanding loan balance. If federal cannabis laws stiffen under President Trump, many of the banks holding notes on cannabis properties likely will use these legal changes as an opportunity to call their notes in default. Because of this potential threat from banks, most cannabis businesses prefer to lease properties free of any bank notes and most landlords with financed property prefer to lend to federally legal businesses rather than risk their property being seized by a federal government asset forfeiture.

The diversity and the complexity of state and local cannabis regulations also helps drive up prices for marijuana business real estate. State laws that limit how close cannabis businesses can be to a school, a park, a church, or another cannabis business also limit the number of properties available to cannabis businesses. When you add in local zoning codes that often push cannabis businesses to heavy industrial areas and building codes that often require cannabis production facilities to have full fire suppression and air quality systems in place, the list of available properties for the marijuana industry plummets even further. With so many marijuana businesses fighting for so few spaces, it is no wonder cannabis real estate prices just keep rising upward.

There is also still a ton of money being invested into cannabis real estate from out-of-state and foreign investors. Many marijuana licensees who lack sufficient capital to build out their growing facilities look for turn-key real estate opportunities, often with deferred rent, where they are expected to pay out the nose when they start making revenue. These higher-priced turn-key cannabis grow operations tend to increase the price ceiling even for landlords who only offer bare warehouse space. Hardly a day goes by where my law firm does not get a call from someone on the East Coast or from overseas (Spain, Israel, Germany, South Africa, and Eastern Europe, mostly) asking one of our cannabis business lawyers about cannabis real estate opportunities in Washington, Oregon, or California. Even public companies are involved in the turn-key cannabis real estate market, including Innovative Industrial Properties, Inc., a cannabis-related REIT that did an IPO on the NYSE earlier this month.

There are some punctures in the ever-rising cannabis real estate balloon, though. Innovative Industrial Properties, for instance, managed to raise only $67 million after making clear it expected more like $175 million. The media has tended to blame President-elect Trump’s choice of Jeff Sessions to run the Justice Department for casting a pall on the cannabis real estate market, and though that is a real concern, there are also other factors at work.

In Washington State, cannabis businesses renting warehouse space in heavily populated King and Pierce counties are facing fierce competition from outdoor growers in Eastern Washington who are rapidly developing techniques to increase the quality and consistency of their cannabis. The continued trend toward oils and other concentrates also puts downward pressure on the market price for crafted indoor product.

Outdoor spaces in rural Eastern Washington counties tend to be significantly cheaper than urban or suburban warehouse space, and if more growers see growing outdoors as a real alternative for them, we should expect cannabis real estate prices (especially warehouse prices) to fall. And even if the Trump-Sessions administration makes policy choices that decrease cannabis availability, the long-term trend among our country’s citizens still inexorably leans toward legality, with cannabis looking more like other businesses. As the cannabis industry “normalizes,” we lease rates for cannabis businesses should begin to fall more in line with lease rates for other businesses.

Though the marijuana real estate bubble seems to be growing ever larger, it’s anyone’s best guess as to when it will actually burst. In the meantime, real estate investors should be careful not to overpay for cannabis properties based on the assumption that their lease market has “nowhere to go but up.”

Hilary Bricken, attorney at Harris Bricken, PLLC. Full story here.

Orlando-area home prices rise, projected to continue to climb

Local home prices were up in October, which is in line with state and national trends, a new report showed.

Single-family home sales prices in the Orlando-Kissimmee-Sanford metro area were up 7.4 percent in October when compared with a year earlier, and inched up 0.5 percent when compared with September, according to a new CoreLogic Inc. report.

Florida's year-over-year home price increase for October was the seventh-highest in the country at 7.8 percent, putting it in the top 15 percent in the nation, the report showed. Home prices nationwide increased year over year by 6.7 percent in October and increased 1.1 percent from September to October.

“While national home prices increased 6.7 percent, only nine states had home price growth at the same rate of growth or higher than the national average because the largest states, such as Texas, Florida and California, are experiencing high rates of home price appreciation,” CoreLogic Chief Economist Frank Nothaft said in a prepared statement.

Meanwhile, CoreLogic forecasted another increase of 4.6 percent by October 2017. Month over month, home prices are expected to increase by 0.2 percent to November 2017. “Home prices are continuing to soar across much of the U.S., led by major metro areas such as Boston, Los Angeles, Miami and Denver,” CoreLogic President and CEO Anand Nallathambi said in a prepared statement.

Prices are being fueled by a potent cocktail of high demand, low inventories and historically low interest rates. Looking forward to next year, nationwide home prices are expected to climb another 5 percent in many parts of the country to levels approaching the pre-recession peak.

Kathryn Deen, Staff Writer - Orlando Business Journal

Sneak peek at retail plans for Creative Village

Curious about what might be part of the Creative Village project in downtown Orlando? You're in luck, because Craig Ustler, president of Ustler Development Inc., gave a hint of what's to come regarding retail plans for Creative Village at OBJ's Doing Business in Downtown panel discussion on Dec. 2.  [Creative Village will be built where the original Orlando/Amway Arena was located, 600 West Amelia St.]

The $1 billion, transit-oriented private redevelopment of 68 acres on downtown's west side will focus on restaurants, coffee shops and bars for the "young, smart, creative people" Ustler expects the area to draw. In fact, Creative Village offers plenty of retail opportunities, with plans for housing for 1,200-plus students, 120,000 square feet of office space and a 290-room hotel.

Ustler said he was most excited about bringing a food hall to serve the planned $62.5 million, 250-unit market-rate apartment complex. "That's really where I think we start to get some legs on the creative side, the entrepreneurial side," Ustler said. "We create local authenticity. [It] gives you some street cred so to speak in that world." The apartment's food hall is part of the $431-million first phase of development at Creative Village, which will mainly cater to the 7,700 students expected to populate the University of Central Florida's future downtown campus.

About 12,000 square feet of ground-level retail and restaurant space sits at the bottom of the student housing complex that Ustler Development and KUD International LLC plan to build. Ustler said they are targeting fast-casual restaurants for the complex, such as coffee shops, Mexican food and hamburger joints, as well as a convenience store and a branch bank. "That's sort of the low-hanging fruit so to speak," Ustler said. "That'll go first and be driven by the critical mass of students on Day 1."

However, Ustler was quick to remind people that retail is not the focus of Creative Village, but rather one part of the bigger picture. "I don't want anybody to think that any of us are talking about downtown becoming a major retail destination as much as we are it's an integral part of the lifestyle as an urban amenity," Ustler said. "It doesn't ultimately take up a ton of square footage. It just really provides a lifestyle balance to what will largely be — because the young, smart creative people that are starting companies and what not, they drink coffee and beer, walk their dog and do that kind of stuff, so that's what you're going to react to, more than just saying, 'Hey we're going to build a Banana Republic because somebody wants to buy a shirt.' That is not what's going to happen in urban environments more or less.

It's going to be totally lifestyle-based and really be an urban amenity to a larger division." Creative Village is expected to generate more than $200 million in economic impact for the region. The UCF Downtown campus is planned to open in 2019, but construction could begin on some projects by 2017.

Kathryn Deen - Staff Writer, Orlando Business Journal

The upside of Florida real estate: 15 market positives

Let's take a look at some of the opportunities and positive indicators for the future of Florida's real estate market.

1. Great prices. Statewide, home prices have fallen about 20 percent in the past year. Florida Association of Realtors® statistics show the existing-home median sales price was $185,400 in the third quarter of 2008, compared with $233,200 in third quarter 2007.By the way, those numbers are still significantly higher than in the early years of the decade. In 2003, the third-quarter sales price was $163,700, which reflects an increase of about 13.3 percent over the five-year period. (The median is a typical market price where half the homes sold for more, half for less.)

2. The time is right. Home sales volumes are rising again -- a signal that the market recovery may be underway. In third quarter 2008, statewide sales of existing single-family homes were up 5 percent compared to the same period last year, according to FAR statistics.

3. High inventory levels. Conditions are ideal for buyers to find their dream home. Inventory is plentiful in all price ranges. But as sales volumes increase, inventory levels are likely to shrink. That reality translates into this advice for buyers: Don't wait too long.

4. Low mortgage rates. Mortgage rates are still at the lowest levels since the 1960s. Lower rates multiply a buyer's financial power. Even half a percent can make a sizeable difference. For example, on a $200,000 home, half of 1 percent could save the homeowner about $815 a year. Buyers can get more home for the money, which is a perfect scenario for families looking to upsize.

5. Incentives to buy. Federal, state and local housing programs can help buyers make that big purchase. The American Recovery and Reinvestment Act has increased the First-Time Homebuyer Tax Credit from $7,500 to $8,000 for purchases on or after Jan. 1, 2009, and before Dec. 1, 2009. Talk to a local mortgage lender about state and federal incentive programs.

6. A long-term-growth state. Long-term economic and demographic trends continue to favor Florida. By 2010, economists forecast that Florida will be the third-most-populated state in the country. Florida has been one of the 10-fastest-growing states in the U.S. for each of the past seven decades, and often the state has been in the top four, according to Census data.Population growth will continue to provide a foundation for other economic development, such as new jobs and growing incomes. All of these trends are positive indicators for real estate growth.

7. A migration magnet. Even with a slowdown in economic growth nationally, projections call for Florida's population to return to more normal growth levels of about 317,000 a year between 2010 and 2020, similar to the 1980s and 1990s, said Stan Smith, director of the University of Florida's Bureau of Economic and Business Research. That's a lot of new buyers coming into the market.

8. A favored retirement destination. Over the long term, Florida stands to benefit from the migration of the aging Baby Boomer generation, roughly 80 million strong. Demographic studies show that the Sunshine State's mild climate and outdoor amenities continue to make Florida a favorite retirement destination.

9. A diverse economy. Florida's economy, like the rest of the nation, is impacted by the recession. Some business sectors, though, appear promising for the Florida economy. The healthcare and technology sectors are quickly becoming an important economic force in South and Central Florida.The Milken Institute/Greenstreet Real Estate Partners ranked five Florida communities on its "Best Performing Cities Index 2008," which ranks U.S. metropolitan areas by how well they are creating and sustaining jobs and economic growth. Florida's business climate ranked fourth among executives and sixth overall on Site Selection magazine's 2008 Top State Business Climate rankings. 

10. Investment outlook. Every quarter, the University of Florida's Bergstrom Center for Real Estate Studies conducts a survey of industry executives, market research economists, real estate scholars and other experts. In the fourth quarter 2008 survey, the investment outlook for various types of Florida properties declined from the third quarter of 2008, although it is noted that the investment outlook remains higher than it was at times in 2006 and 2007."We have 40 pages of comments from our respondents, and although the dominant theme is the disruption of financing, perhaps the second theme, as one person put it, is people being on the sidelines with full pads and helmets just waiting to jump back in," says Director Dr. Wayne Archer, when referencing the 2008 third quarter results.

11. Homeownership has value. Realtors® believe -- and research supports the belief -- that homeownership provides a variety of tangible and intangible benefits to the community and homeowners. Studies show that home equity is still the largest single source of household wealth.

12. Greater sense of well-being. Owning a home leads to increased personal well-being. Research shows that people who own their own homes tend to show higher levels of personal self-esteem and life satisfaction, which in turn helps to make homeowners and their children more productive members of society.

13. Beneficial for kids. Studies show that children raised in homes owned by their families are more likely to stay in school and graduate high school. They're also shown to have a higher lifetime annual income.

14. Community involvement. People who own homes have a strong financial stake in what happens to their community and tend to become more involved in community and civic affairs. Studies show that homeowners also interact more with their neighbors and communities.Compared to renters, homeowners join up to 41 percent more civic and/or nonprofessional organizations, such as the PTA or Scouts; vote in local elections 15 percent more often; enhance their neighborhoods with gardens 12 percent more often; attend church about 10 percent more often; and have a 3 percent greater chance of being interested in public affairs.

15. An unsurpassed lifestyle. Finally, let's not forget the things that brought people to Florida in the first place, and will continue to attract them -- beautiful beaches, fabulous weather and a friendly business climate, with no state income tax. It's no wonder that Florida's combination of temperate climate, outstanding recreational amenities and economic opportunity has consistently put the Sunshine State in the top three of Harris Poll's "Most Desirable Places to Live" survey.

Copyright © 2016, Orlando Sentinel

6 Things to know about the Orlando Real Estate market

As we [begin to embark on] a new year, real estate professionals are already looking ahead in Orlando and the surrounding areas. Whether you’re in the industry, or you’re a home buyer or seller looking to make a move, there are some fast facts to understand about Orlando and the real estate.

Orlando has certainly seen substantial ups and downs in the market since the Great Recession, but things are looking up in the area, which could mean a great year for real estate.

Median Home Prices Are On the Rise
According to the Orlando Business Journal, a report from the Orlando Regional Realtor Association shows median home prices rose by 10.3% in November. Despite the fact that overall sales were slightly down, this increase in median prices is good news for sellers who want to make a move in 2016. It wasn’t just November that showed price increases—the Orlando-area median home price has seen year-over-year increases for 52 consecutive months.

2015 Was a Bullish Year in the Real Estate Market
Along with rising median home prices, the Orlando-area market showed strong numbers throughout 2015, and in particular in June and July. The Orlando Sentinel reported summer and fall home closings in Orlando increased about 30% over 2014.

New Industry Appears To Be Moving to the Area
There’s no reason to think Orlando real estate won’t continue to show strong performance, particularly as the area is gaining new industrial and commercial properties, which could bring jobs to the area and strengthen the local economy. Recently the Orlando-based Crews Commercial Venture LLC., which is related to CNL Commercial Real Estate, spent more than $11 million buying 53 acres of land in unincorporated Orange County. The Orange County Commission has already given the green light for future development, and reports are circulating that plans are to build an industrial park on the land.

Buyers Are Flocking To the Area’s Most Popular Neighborhoods
According to Trulia’s Market Trends report, there are certain areas in Orlando that are seeing the most interest from buyers. These communities include Meadow Woods, Metro West, Pine Hills, Lake Nona, Doctor Phillips and Lockhart. Of those, Lake Nona is perhaps one of the most popular, offering luxury buying options such as access to lake-front homes, golf and country club access, and new construction properties. The average listing price for Lake Nona, according to Trulia, was $578,118 at the end of 2015.

Inventory Is Dropping
If you’re a seller, news that Orlando and Central Florida home inventory is dropping can be great news, however if you’re a buyer it means now is the time to make a purchase. In November 2015, the number of existing homes of all types available to buy was 6.77% lower than the inventory numbers a year before. Additionally, if you’re searching for an investment property or a foreclosure, the availability of those properties dropped nearly 40%, and short sale availability went down almost 46% in the past year.

Price Per Square Foot Is On the Rise
Along with general median home sale price, the Orlando area is seeing increases in price per square foot, which is a key metric for realtors. One year ago the average price per square foot for a home in the area was $88 while right now it stands at $98 per square foot.

Making it the time to Buy or Sell!

Based on the current news and trends coming out of Orlando and the greater Central Florida area, it could be a great time to make your move, whether your plan is to buy or sell a home this year. Inventory is shrinking while prices are going up, so buyers should be proactive to get great deals while they still exist, and sellers should take advantage of a market that continues to heat up.

Carmelo Hannity, TheGlobalDispatch.com

Home Prices Near 10-Year Peak in U.S.

Yet Not a Housing Bubble Market Says Nationwide...

According to a forward-looking housing barometer report released this week by Nationwide, U.S. home prices nationally have risen significantly since the 2008 mortgage crisis, but "healthy fundamentals" in the majority of local housing markets signify that another housing bubble isn't imminent.

Today's housing market remains positive and in stark contrast to the conditions during the housing bubble when more than three-fourths of metro areas flashed warning signs at least two years before the bubble popped, according to Nationwide's Health of Housing Markets Report (HoHM Report).

The latest HoHM Report finds that continued job growth, increasing incomes and record low mortgage rates across the U.S. are keeping housing affordable. Additionally, modestly tight mortgage underwriting criteria and a decided lack of overbuilding should support housing markets in the year ahead. The report also shows that there are a handful of regional markets where house prices are more than 20 percent above their pre-crash peaks.

"Home prices reaching or even passing their pre-crash highs of a decade ago does not signal a bubble in the near future," said David Berson, Nationwide senior vice president and chief economist. "Even with record-high prices in some markets, housing remains relatively affordable, and we are not concerned about a national bubble."

Berson noted that only 7.1 percent of homeowners remain underwater on their mortgages and housing market metrics across the board remain healthy. "We're optimistic that the housing market will continue to boost the U.S. economy," he said.

The quarterly report evaluates the housing health for the U.S. and 400 metropolitan statistical areas. Overall, it indicates that the vast majority of local housing markets will experience sustainable housing activity during the next year with little chance of substantial downturns.

Incomes in six markets across the country, however, are not keeping pace with sharply rising home prices. They are Dallas, Houston and Austin, Texas; Denver, Colo.; and San Francisco and San Jose, Calif. Meanwhile, home prices in several metro areas that experienced the biggest increases in the housing boom remain more than 20 percent below their peak. They include Bakersfield and Fresno, Calif.; Las Vegas, Nev.; Orlando, Fla.; and Tucson and Phoenix, Ariz.

The report also found that:

• While more than half of metro areas are still below their peak home prices of a decade ago, about 150 areas set all-time price peaks already in 2016. Housing trends driving the overall market suggest that national home prices should surpass their previous peak in coming years. 
• The energy sector slowdown weighs heavily on job growth and housing sustainability in Louisiana, North Dakota, Texas and Wyoming, placing metro areas in those states among the bottom 10 states on the index for the second consecutive quarter. Many of them have been at the bottom for the past year. 
• Major MSAs among the top 50 include Baltimore, Cincinnati, Detroit and Jacksonville; meanwhile, three of the 40 largest MSAs remain concerning, just outside of the bottom 10: Houston, Seattle, and New Orleans. The 10 top metro areas in the index, which reflects the health of housing, are, in order, Fayetteville-Springdale, Ark.-Mo.; Saginaw, Mich.; Valdosta, Ga.; Cumberland, Md.-W.Va.; Jackson, Tenn.; New Bern, N.C.; Buffalo-Niagara Falls, N.Y.; Niles-Benton Harbor, Mich.; Durham-Chapel Hill, N.C.; and Manhattan, Kan.

Residential News » Irvine Edition | By Michael Gerrity

Which political party is better for home ownership?

If you want to know which political party is better for home ownership, the answer is: It depends on where you live.

Nationwide, homeowners living in Democrat-controlled congressional districts have gained more than twice as much in housing wealth as homeowners living in Republican-controlled districts over the past eight years, according to ATTOM Data Solutions. However, those in Republican districts in Florida fared better than their counterparts in Democrat-controlled districts, while the opposite is true in Orange County.

Nationwide, homeowners living in Democrat-controlled congressional districts have gained more than twice as much in housing wealth as homeowners living in Republican-controlled districts over the past eight years. Nationwide, homeowners living in Democrat-controlled congressional districts have gained… more

Key U.S. highlights include:
Among 2.4 million single family homes bought eight years ago, those in Democrat-controlled districts have gained an average $59,467 in value since purchase — a 21 percent return — compared to a $22,086 return representing a 10 percent ROI for homes in Republican-controlled districts.

Homeowners in Republican-controlled districts are paying lower property taxes — $2,514 on average representing a 1.02 effective tax rate compared to $3,659 representing a 1.07 percent tax rate for homeowners in Democrat-controlled districts. Counter to the national trend, seven of the 11 battleground states in the 2016 presidential election have produced better ROI for homeowners in
Republican-controlled districts.

Here are Florida’s stats:
About 42,190 single-family homes bought eight years ago in congressional districts with a Democratic representative have gained an average of $21,990 in value since purchase, an 8 percent return. In comparison, about 95,813 single-family homes bought eight years ago in congressional districts with a Republican representative saw an average $26,790 return, representing an 11 percent return on investment.

Homeowners in Republican-controlled districts are paying lower property taxes —$2,895 on average for a 1.09 percent effective tax rate compared to $3,937 representing a 1.37 percent tax rate for homeowners in Democrat-controlled districts.

Here are Orange County stats:
Home buyers saw an average $12,682 gain in value, or a 6 percent return, in congressional districts with a Democratic representative, while those who bought a home eight years ago in congressional districts with a Republican representative saw an average $13,317 gain, or a 4 percent return. Homeowners in Democrat-controlled districts are paying lower property taxes — $2,277 on average for a 1.03 percent effective tax rate, compared to $4,691 or a 1.37 percent effective tax rate in Republican-controlled districts. - Susan Lundine, Managing Editor Orlando Business Journal

Central Florida’s housing market: Median sales prices up in August 2016

Central Florida’s housing market reported more closed sales and higher median prices in August, according to the latest data released by Florida Realtors.

Local closed sales of existing single-family homes totaled 3,150 last month, up 5.5 percent from August 2015. Statewide, closed sales of single-family homes statewide totaled 25,070 last month, up 8.2 percent from August 2015.

“A continued lack of inventory – particularly in the mid-$200,000 and under range – is creating obstacles for many buyers who are trying to enter Florida’s housing market,” said 2016 Florida Realtors President Matey H. Veissi in a prepared statement.

Statewide inventory was at a 4.2-months’ supply in August for single-family homes and at a 5.8-months’ supply for townhouse-condo properties.

“Rising median prices also may be an inhibiting factor for these would-be homeowners; however, the uptick in prices could persuade sellers that now is the time to list their properties for sale, which in turn may help ease the tight supply in many areas,” said Veissi.

The median sales price for a single-family home in Central Florida was $229,000 in August, up 13.4 percent from the year-ago period, and higher than the statewide median price of $225,000.

For townhomes and condos, the local median sales price was $130,000 in August, up 13.3 percent from the same month last year, lower than the statewide median of $160,000. There were 854 condos and townhomes sold last month in the region, up 4.9 percent for the year-ago period; and 9,484 townhouse-condo sales closed statewide last month, up 3.3 percent compared to August 2015.
In August, statewide median sales prices for both single-family homes and townhouse-condo properties rose year-over-year for the 57th month in a row.

The national median sales price for existing single-family homes in July 2016 was $246,000, up 5 percent from the previous year; the national median existing condo price was $228,400, according to the National Association of Realtors.

“Closed sales of single-family homes in Florida were up by 8.2 percent year-over-year in August, effectively erasing all of the losses from July,” said Florida Realtors Chief Economist Brad O’Connor in a prepared statement. “August’s gains were broad-based, with 20 of Florida’s 22 metro areas experiencing a year-over-year increase in sales. - Susan Lundine, Managing Editor, Orlando Business Journal

Orlando houses sell at fastest clip since 2006

Indecisive home buyers in the Orlando area were left behind last month as houses sold faster than in a decade, a new report shows.

Orlando-area houses that sold during August landed a contract within an average 56 days of hitting the market — the shortest sales period since May 2006, when the real estate bubble was about to burst.

"There are less homes on the market, and people are still looking. The demand is still high," said Caroline Moffitt, an agent with Keller Williams Heritage, based in Altamonte Springs. "It makes for a good market for sellers."

A year ago, houses took an average of two weeks longer to sell than in August, according to reports from Orlando Regional Realtor Association, which looks at sales mostly in Orange and Seminole counties. During the depths of the recession in 2008, Orlando houses took more than twice as long to sell as they did last month.

The late summer buying season in Orlando brought increased activity with 3,429 houses selling in August — up 2 percent from a month earlier and up 7.3 percent from a year earlier. Housing supply shrank too, dwindling to three months worth of inventory from 3.2 months in July and from 3.6 months a year before, the association's monthly sales report shows.

"There were 21 percent fewer single-family homes listed below $300,000 available for purchase than this month last year," said Lazenby, president of the association. "The lack of available options is pushing buyers to take advantage of the current low interest rates and choose more expensive properties they might not otherwise be able to afford with higher rates."

Lazenby underscored the market's bifurcation by pointing to a supply of just 1.98 months for houses priced under $300,000. Buyers don't begin to realize the benefits of a more balanced market — with closer to a six-month supply of listings — until they look at houses priced higher than $400,000, he added.

Buyers had to jump faster for contracts in August, but, unlike the heated market a decade ago, they benefited from relatively flat prices.

Typically the summer buying season peaks in July, with families positioning themselves for the new school year, but this year, median prices topped in June at $207,000 for the core Orlando market. In August, median prices held at $205,990, which was flat from a month earlier. Compared with a year ago, prices rose 13.8 percent.

Mary Shanklin, Reporter - Orlando Sentinel

Uptick in Home Refinancing Driven by Lower U.S. Mortgage Rates

Freddie Mac's latest Primary Mortgage Market Survey is reporting this week that the average fixed mortgage rate in the U.S. is moving slightly lower for the week helping to spur ongoing refinance activity.

Sean Becketti, chief economist of Freddie Mac, "The 30-year fixed-rate mortgage fell 2 basis points to 3.44 percent this week. As mortgage rates continue to range between 3.41 and 3.48 percent, many are taking advantage of the historically low rates by refinancing. Since the Brexit vote, the refinance share of mortgage activity has remained above 60 percent."

Freddie Mac News Facts:

• 30-year fixed-rate mortgage (FRM) averaged 3.44 percent with an average 0.6 point for the week ending September 8, 2016, down from last week when it averaged 3.46 percent. A year ago at this time, the 30-year FRM averaged 3.90 percent. 
• 15-year FRM this week averaged 2.76 percent with an average 0.5 point, down from last week when it averaged 2.77 percent. A year ago at this time, the 15-year FRM averaged 3.10 percent. 
• 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.81 percent this week with an average 0.4 point, down from last week when it averaged 2.83 percent. A year ago, the 5-year ARM averaged 2.91 percent. 

WPJ Staff - World Property Journal

Orlando's "Milk District" to receive multi-year makeover

Real estate investor Adam Wonus has raised millions of dollars to buy and demolish about 60 old houses mostly in east Orlando's Milk District with the hope of transforming it into the next Thornton Park.

As he drives past a 1940s house he recently purchased in east Orlando's Milk District he spots a vagrant slipping into an open window. The trespasser won't be able to squat there for long. The old, whitish house will be razed soon.

Wonus, 33, has demolished about 25 1940s-era homes near the old T.G. Lee Dairy property and replaced them with new rental townhomes. In little over a year, he has put together a portfolio of about 50 properties in the area about two miles east of downtown Orlando.

"What I want to do is help change Orlando," said the Ohio native, who would like to transform the Milk District into Orlando's next Thornton Park — an older neighborhood saved from urban blight by house makeovers with trendy shops and restaurants.

Unlike most real estate investors buying houses in Central Florida, Wonus draws from a banking background that has helped him raise millions of dollars. In addition, he owns Atrium Management Company, which has about 500 rentals. He said he would rather rent out his townhomes than sell to better control how the neighborhood evolves.

The Milk District area he wants to remake draws mostly 20-something tenants searching for backyard fire pits and cheaper rents than they can find in downtown Orlando. They are slowly edging out older residents, many on fixed incomes, who long ago sought the affordability of homes with fewer than 2,000 square feet.

Longtime homeowner Danielle Knight weeds the butterfly garden she has created in her front yard. She stops and sighs when asked about the redevelopment just a few houses away. "It's sad," said Knight, a nurse who bought her house when both she and her husband worked at the former Orlando Naval Base more than 30 years ago.

Investment firms have purchased rental homes in mainstream neighborhoods throughout Central Florida. "This is an older Orlando neighborhood and instead of taking a house and remodeling it, they're building this thing here and that thing there."

Prices there have spiked and sales have slowed, reflective of the region's sparse listings. Average sales prices for houses in the 32803 ZIP code jumped by about $30,000 during the last year to $300,000 in June. Sales dropped from 111 in June 2015 to 41 in June 2016, according to Orlando Regional Realtor Association reports.

Wonus said he likes to stay below $135,000 on his purchases. To keep costs down, he said he scouted construction sites to find a contractor who could build his townhomes affordably.Eyeing a dilapidated blue house as he drove around his properties, Wonus said: "This one I want so badly." Renters at the house pay about $500 a month. Next door to it is one of Wonus'signature two-story townhome duplexes. Renters there pay more than $2,000.

The houses sport quality materials and finishes and get pressured washed every year, Wonus said. Cars are prohibited from parking on the front-lawn sod he has planted.

Nearby, Rod Vermilio of Distinguished Development and Contracting Inc. is at work on a townhome and duplex project he expects will have rentals and sales from the $300,000s. "We identified the Milk District as an ideal place to create some quality housing," he said."It's a fringe area that we feel has great potential."

Orlando has seen other developers remake partially blighted areas. Dan Bellows assembled low-income pockets of west Winter Park and developed the Hannibal Square shopping area.
In the 1990s and early 2000s, Craig Ustler and Phil Rampy combed through Thornton Park, rehabbing old houses and ultimately developing midrise residential towers. Ustler, who is trying to ignite Creative Village in the Parramore area, said he has met with Wonus and appreciates his vision and financial background.

"I think he sees the Milk District and other in-town neighborhoods as underdeveloped, but also understands that land assemblage and controlling development costs are potential roadblocks," Ustler said.

But holding the weeder and working in her garden, Knight lamented the new two-story townhomes that overshadow the first generation of Colonial Town houses. Seeing prices rise won't help her because she doesn't want to sell. "I'm not going anywhere," she said. "This is my home."

- Mary Shanklin, Contact Reporter - Orlando Sentinel

New town center plans for Lake Nona

A new “marriage” is brewing in Lake Nona, this time to create the southeast Orlando community’s 3.8 million-square-foot central commercial district.

Tavistock Development Co. LLC has partnered with Columbus, Ohio-based Steiner + Associates to master plan the next phases of the Lake Nona Town Center. Steiner + Associates will work with Tavistock Development on retail planning, leasing and development services.

The next phase of Lake Nona's 100-acre, open-air town center will include a mix of shops, eateries, entertainment venues, office and hotels. Early plans being discussed include a possible upscale movie theater and bowling alley. The Lake Nona Town Center will serve as the “defining anchor and amenity” for the 8,000-acre community, which already boasts 10,000-plus residents, 7,000 students and 5,000 employees in the Medical City life sciences hub.

Tavistock already introduced a downtown-like atmosphere in the first $70 million phase of the Lake Nona Town Center. It now includes an 85,000-square-foot, four-story office building with ground-level restaurants; a 200-room, dual-branded Courtyard by Marriott and Residence Inn building and structured parking. Urban-style apartments also are being built across the street from the new complex.

But by bringing in Steiner + Associates, Tavistock Development will gain expertise from a company known as a pioneer in creating the modern live/work/play environment now being used throughout the country. Steiner in 1999 debuted Easton Town Center in its hometown of Columbus, paving the way for retail destinations in the next several years. That project continues to draw new concepts. Read more about that development from sister paper Columbus Business First.  Then, Steiner + Associates last year opened Liberty Center, a $350 million mixed-use development in the Cincinnati region.

“Steiner + Associates is among the most creative and innovative mixed-use planners in the country with groundbreaking projects like the Easton Town Center and Liberty Center,” Tavistock Development President Jim Zboril said in a prepared statement. “We are attracted to their energy and passion for place making as well as their strong track record for inspiring, engaging and creating mixed-use communities.”

“Lake Nona Town Center will be unlike any other mixed-use project in the country,” Steiner + Associates founder and CEO Yaromir Steiner said in a prepared statement. “From thoughtful design and community integration to curating the very best mix of retail, restaurants, entertainment and other uses, we are going to deliver something very special to Central Florida.” - Anjali Fluker, Associate Managing Editor @ the Orlando Business Journal

Summer home sales soften for Orlando

Orlando's housing market did not get its typical bump in prices from June to July, a new report shows.  The midpoint price for the core Orlando market in July was $205,382, which was down from $207,000 the month before during a time of year when prices usually surge as families relocate prior to the school year starting. Even with the slight month-over-month softening, prices were still 12 percent higher than a year earlier, according to a report released this week by the Orlando Regional Realtor Association.

Sales declined to 3,342 in July, which was down about 6 percent from both a month earlier and a year earlier.  "Competition for homes in the entry-level and mid-price range (under $300,000) continues to remain high, especially among first-time home buyers and investors," said Colony Realty Group Inc. agent John Lazenby, president of the real estate industry association.

Another sign of a less-than-robust summer was the amount of houses on the market. The inventory of listings edged up slightly to 3.19 months of supply from 2.99 months in June. Even though supply ticked up, it remained about half what is considered a normal for a market.

"Additionally, would-be sellers are staying put and hesitant to put their homes on the market because they will face high prices and few choices as they look for a new home," Lazenby said.
Despite declines in prices and sales, July home buyers were still hit with such a competitive landscape that houses came under contract in an average of 60 days — the smallest amount of time in more than a decade.

The month-over-month declines in sales and price came as interest rates on a 30-year mortgage remained relatively low at 3.45 percent. - Mary Shanklin, Contact Reporter @ the Orlando Sentinel.

Now's the time to sell: Orlando home prices continue to increase!

Orlando-area home prices increased by 6.9 percent in June compared with June 2015, according to a new report by CoreLogic. Orlando's home price surge was better than the nationwide year-over-year average, which saw an increase of 5.7 percent.

Orlando-area home prices also saw a month-over-month growth, increasing by 0.8 percent compared with May. Statewide, Florida ranked No. 6 in year-over-year home price increase at 7 percent. Oregon and Washington came in at No. 1 and 2 at 10.9 percent and 10.3 percent, respectively. Other Realtor associations also have reported an upward trend in home prices.

Further, experts expect the increase to continue: The CoreLogic Home Price Index Forecast predicts that home prices will increase nationally by 5.3 percent on a year-over-year basis from June 2016 to June 2017.

Other positive trends, such as the region's low home inventory, are signs that Central Florida's real estate market is steadily making its way back to pre-recession levels.  - Emma Skeels, Reporter @ the Orlando Business Journal.

Election Pessimism Could Hurt The Housing Market, Survey Suggests

Whether you prefer Hillary Clinton, Donald Trump or [a third party candidate], there’s no question that the next president’s economic and employment policies will be a key influence on the health of real estate for the next four years, including, perhaps, the price of a mortgage.

“While homeowner anxiety over the election is clearly mounting, the likelihood of an immediate shock to the market is slim,” Redfin chief economist Nela Richardson said. “It will take considerable time for our next commander-in-chief to implement policies that have any impact on housing.”

No matter who wins this fall, they’re likely to inherit a stronger real estate market than four years ago. Read full article by Troy McMullen, Contributor at Forbes.

US new-home sales climbed in June to more than 8-year high

WASHINGTON (AP) — Americans bought new homes in June at the fastest pace in more than eight years, a sign that a solid job market and low mortgage rates are bolstering the broader U.S. economy. The Commerce Department said Tuesday that new-home sales rose 3.5 percent last month to a seasonally adjusted rate of 592,000, the best level since February 2008.

Purchases of new homes have climbed 10.1 percent year-to-date, despite volatile sales on a monthly basis. Low mortgage rates and a healthy job market have lifted the real estate market, which continues to recover from the depths of the housing bust that began nearly a decade ago. Greater demand and tight inventories have led to rising prices, such that the potential to return to the historic sales rate of 650,000 new homes could be limited.

Builders say they're struggling to find both workers and land for additional construction. June's median sales price rose 6.1 percent from a year ago to $306,700. Just 4.9 months' supply of new homes is listed for sale, well below this historic average of six months. Sales surged in the West and Midwest by more than 10 percent in June, but declined in the Northeast and South. The market for new houses is roughly just a tenth of the size of the existing-home market, where sales are also rising even as the number of listings are shrinking on a yearly basis.

The National Association of Realtors said last week that sales of existing homes rose 1.1 percent in June to a seasonally adjusted annual rate of 5.57 million, the best performance since February 2007. But the number of listings has fallen 5.8 percent from a year ago to 2.12 million.

Surviving a Seller’s Market: The Ultimate Cheat Sheet

House hunting is challenging enough at any time; shopping during a seller’s market is a whole additional difficulty level—and that’s what would-be buyers are seeing across the country.

The supply of homes is low, demand is high, and sellers are in control. If you’re not careful, you’ll be left drying your eyes with the broken shards of your rejected bid. Sound painful? It is.

So you’d best bring your A-game, or don’t bother showing up at all.

Read entire article on realtor.com

Bet you haven't heard of "Horizon West"

Horizon West, located in southwest Orange County, north of Disney upwards towards Windermere, includes five mixed-use villages surrounded by greenbelts, as well as a Town Center. The concept was adopted in 1995, and the area is growing extremely fast.  Developers met many challenges to build this community.

Learn more about the 15 year history of Horizon West and plans for future growth.  Also, check out the interactive map showing you where everything will be located!

http://www.livehorizonwest.com/wp/list-of-communities/

7 Ways To Compete With Cash Buyers In A Seller's Market

The old adage “money talks” rings true in real estate. After the stock market crash in 2008, homebuyers with all-cash offers quickly became sellers’ most sought-after suitors. All-cash, after all, means no mortgage, and no loan means no need to rely on lenders. So now that the market has heated up again, bidding wars are the new normal, from Alexandria, VA, real estate to homes for sale in San Angelo, TX. Unfortunately, it’s common for a seller to favor an all-cash offer over an offer from a buyer whose deal hinges on a mortgage approval.

Read full article on Forbes.com

Whether you are a first-time homebuyer or a first-time homeseller, dealing with real estate processes can be confusing.  Fortunately, you have me and Premium Property Real Estate Services by your side.

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Today, there is a shortage of homes available for buyers, and sellers are consistently receiving offers above the listing prices, many times multiple offers.

Please call (407-906-1127) or email me for your complimentary market assessment on your home or to hear about all of the services that we provide.