Jupiter: The Best Place on Earth

Can the HARP Program help me?

If you are are one of the thousands of South Florida homeowners struggling to make your mortgage payments, but you can't refinance at today's lower rates because you're  "underwater" (the mortgage on your home is more than the home is worth), there's a goverenment program that may help. It's called HARP, or Home Affordable Refinance Program. Your loan has to be owned or guaranteed by Fannie Mae or Freddie Mac and you must be current on your payments.  How do you know if your loan is a Fannie Mae or Freddie Mac loan?  Check out these webistes to find out:  www.fanniemae.com/loanlookup and www.freddiemac.com/mymortgage .

Her are some other stipulations:

The mortgage MUST have been sold to Fannie Mae or Freddie Mac on or before May 31, 2009.

The mortgage CANNOT have been refinanced under HARP previously unless it is a Fannie Mae loan that was refinanced under HARP from March-May, 2009.

The current loan-to-value (LTV) ratio MUST be greater than 80%.  It can be over 100%...in other words, you're "underwater".

You MUST be current on the mortgage at the time of the refinance, with no late payment in the past six months and no more than one late payment in the past 12 months.

You have a reasonable ability to pay the new mortgage payments.

The refinance will improve the long term affordability or stability of your loan

For more answers to your questions, go to www.harpprogram.org .

In Palm Beach, Broward and Miami-Dade counties, there are over 1500 Fannie Mae or Freddie Mac backed mortgages, so the odds that yours is one of them are not too bad, But if you don't meet all the criteria above, for example, if you've missed several payments, your probablility of being able to refinance is slim. If you live in the Jupiter area and need advice on what to do, please don't hesitate to contact me.  I specialize in short sales and get them done as quickly and efficiently as possible,  The law firm I work with has closed hundreds of short sales, often negotiating a full financial release for the homeowner/borrower.  We can help, and we always do what's in your best interest.  Give me a call. 561 512-1575.

Rentals in the Jupiter area are tight

 Good rentals are getting hard to find and the rent prices are increasing. This is probably good news for the Jupiter/Palm Beach Gardens/Tequesta housing market overall.  Why? Because it means the inventory of homes for rent is shrinking, probably because many of the houses investors were trying to rent have been foreclosed on or sold as short sales.  Now that those houses are off teh market, often as the buyers' primary residence, there aren't as many left for sale or rent. 

I recently worked with renters who missed out on two properties because they had just started looking and weren't sure what was on the market and hesitated to bring an offer until they had seen more properties.  Another unit came on the market and we took a look at it the first day and submitted a contract to lease the very next day.  There were 2 other offers on that unit in Abacoa on day 2 of the lisitng.  We were fortunate to get it because my renters had a very good credit rating and no pets.  I was getting concerned that we wouldn't be able to get them into a unit they liked because theere just aren't that many out there, and the good ones go fast!

I've also noticed sale prices inching up lately, also due in part to the lower inventory.  The inventory of homes for sale or rent in Abacoa, for example, is the lowest it's been in about 6 years.  So what does all this mean?....it means the market is starting to turn from a buyers market to a more balanced market.  If you're thinking of buying or renting, I'd recommend doing it sooner rather than later.  The median home price in Palm Beach County is half of what it was at the height of the market in 2005/2006 (it was over $400K, now it's about $180K), and the interest rates on mortgages are ridiculously low. It won't always be like this...make the move now if you can....don't miss the bus!

It's a GREAT Time to Buy. Really!

Okay, so you've been thinking of buying a house, but you don't know if you can afford it....downpayment, closing costs, repairs....what's it going to take?

Well, if you're in the market to buy, here are a few things to consider. If you qualify (and it's not that hard...a solid job and a credit score of about 670 or above) you can get an FHA loan for just 3.5% down payment.  But you say, what about all the other closing costs?...those can really add up!  That's true to a point, but you can have the seller pay most or all of your closing costs and pre-paid items (pre-paid taxes, insurance, etc). Why would a seller do that?  Well, once you agree on a price, the seller is not going to be Mr. nice guy and pay your closing costs, but we very often can add your closing costs to the purchase price, and in essence, you are financing your closing costs.  The seller nets the same amount of money and you don't have to come out-of-pocket with the cash.  It's a beautiful thing.  By the way, as a rule of thumb, you can figure about 4 to 4.5% for closing costs/pre-paids on a financed (mortgaged) purchase. All of you people out ther who are lucky enough to pay cash, your closing costs will be minimal...often a couple hundred buck or less.

Home prices in Palm Beach County are half of what they were in 2005. The median price back then was just over $400,000...now it's just under $200,000.  Interest rates are at a ridiculously low level, hovering at around 4%. Will the prices stay low or go lower? Will the interest rates stay low?  There are those who say that the banks have a "shadow inventory" of homes they have foreclosed on or are in the process of foreclsing on, and when these homes hit the market, prices will continue to drop.  Nobody really knows what will happen, but consider this: the inventory of homes for sale in certain areas is actually very low now.  For example, where I live and do a lot of my business - Abacoa in Jupiter, the home inventory is at its lowest in about 5 years.  Prices are starting to creep back up because of competition for these good buys. No one has a crystal ball, but if you're thinking of jumping into the housing market, just think how lucky you are that you didn't buy 5 years ago.  No matter if the prices rise or drop slightly from here on out, with the prices where they are and the interest rates super low, you've got to give it some very serious thought.  You don't know where the bottom of the market is until the prices start going back up. Then it's a little too late to get the best deal.  It's all about economics 101...supply and demand.

If you would like to discuss our local real estate market or if you have comments, I'd love to hear from you!

Best Regards.

Bob
Cell: 561 512-1575 

Shadow Inventory Keeps the Housing Market Down

If you're hoping this depressed housing market in Palm Beach County is going to pick up any time soon, so you won't be upside down on that house you own that you wish you could sell...well, I wouldn't hold my breath.  Why?  Because we still have a very high inventory of homes and there are a lot more to follow, in large part because the banks are not putting most of thier foreclosures back on the market.  Those properties (the Shadow Inventory) will keep trickling into the housing market for the next few years.  If the banks put all thier foreclosed homes on the market right now, there would be even more of a flood of homes and the prices would plummet.

Consider this: Standard and Poor's came out with numbers that show the housing shadow inventory in the US has been steadily rising since the Fall of 2009. Palm Beach County has approximately 26,800 distressed properties (in the foreclosure process and bank owned), and of those, almost 24,000 are not listed for sale.  You can drive through many communities and see houses that have been vacant for months with no For Sale signs. Many experts say that only about 10% of distressed properties are on the market. Florida has the third largest percentage of distressed properties in the US and Palm Beach County has the highest of any Florida county.  Some areas, such as Jupiter and Palm Beach Gardens, have seen a slight rebound in price this last quarter (6% and 8% respectively from the same quarter in 2009), but with so much inventory coming to market, the odds are that prices will stagnate or even decline some over the next year or two. 

At least this is great news for buyers...prices have dropped over 50% since the highs of 2006 and  mortgage rates are at or near all time lows.  If you've been waiting, you've got the Perfect Storm for buying right now.  Even though housing prices will probably continue to stay low, if interest rates start climbing, it will make a big difference in your mortgage payment.  If the interest rates go up 2%, the monthly payment on a 30 year $300,000 mortgage goes up about $365.  Timing is everything....

Shadow Inventory Effects House Prices

If you're hoping this depressed housing market in Palm Beach County is going to pick up any time soon, so you won't be upside down on that house you own that you wish you could sell...well, I wouldn't hold my breath.  Why?  Because we still have a very high inventory of homes and there are a lot more to follow, in large part because the banks are not putting most of thier foreclosures back on the market.  Those properties (the Shadow Inventory) will keep trickling into the housing market for the next few years.  If the banks put all thier foreclosed homes on the market right now, there would be even more of a flood of homes and the prices would plummet.

Consider this: Standard and Poor's came out with numbers that show the housing shadow inventory in the US has been steadily rising since the Fall of 2009. Palm Beach County has approximately 26,800 distressed properties (in the foreclosure process and bank owned), and of those, almost 24,000 are not listed for sale.  You can drive through many communities and see houses that have been vacant for months with no For Sale signs. Many experts say that only about 10% of distressed properties are on the market. Florida has the third largest percentage of distressed properties in the US and Palm Beach County has the highest of any Florida county.  Some areas, such as Jupiter and Palm Beach Gardens, have seen a slight rebound in price this last quarter (6% and 8% respectively from the same quarter in 2009), but with so much inventory coming to market, the odds are that prices will stagnate or even decline some over the next year or two. 

At least this is great news for buyers...prices have dropped over 50% since the highs of 2006 and  mortgage rates are at or near all time lows.  If you've been waiting, you've got the Perfect Storm for buying right now.  Even though housing prices will probably continue to stay low, if interest rates start climbing, it will make a big difference in your mortgage payment.  If the interest rates go up 2%, the monthly payment on a 30 year $300,000 mortgage goes up about $365.  Timing is everything....

STOP RENTING NOW AND BUY A HOME - IT'S PROBABLY BE CHEAPER!

With home prices (single family homes, Condos and Townhouses) having dropped over 50% in Palm Beach County since the highs of 2005-2006, and mortgage interest rates at or near an all time low, it makes a lot more sense to buy now than to rent in many circumstances. Many potential first time home buyers in the Jupiter area don't think they can qualify or afford to buy, but many of them would be surprised.

Let's take a typical example: Let's say you're considering renting a 1500 sq. ft. townhouse.  The going rate on average in Jupiter would be around $1500.  You'll need first, last and security deposit, for a total of about $4500. So over the course of the first year of renting your total outlay will be $18,000, which you'll never see again.

Compare the renting costs above to what it costs to buy and own the same property.  If you have a credit score in the high 600's or better, you can get an FHA loan for 3.5% down payment. So on this $150,000 townhouse, that would be $5250 (comapred to $4500 for renting).  You would have closing costs and pre-paid costs (pre-paid taxes, insurance, finance fees, etc) of about 4% of the purchase price, or about $6000.  Don't have the $6000?  Well, you can often get the seller to pay those costs (FHA allows up to 6%) by increasing your offer by that amount. So your purchasse price would go up to $156,000, but you'd have no closing costs - just the $5250 dwon payment.  With  mortgage interest rates around 4.5%, that extra $6000 on your mortgage would only cost you about $30 per month...not bad for not having to pay $6000 out-of-pocket. 
So, what would your monthly costs be to purchase?  In this scenario, with a purchase price of $156,000 and a down payment of 3.5%, your monthly costs would break down approximately like this:

Principal and interest:   $762
Taxes:                           215
Homeowner's Ins.           150
HOA fees                       200

Total monthly costs     $1327

So, for about $175 less per month, you could own the place instead of renting.  If you expect residential prices to start rising again, you'll be building equity as well as having lower payments.  Definitely worth talking to your realtor about!

Property values may be stabalizing in Abacoa

The inventory of townhouses and single family homes in Abacoa appears to be decreasing and consequently values are stabalizing and even rising in most cases. Townhouses that sold for as low as $200,000 have recently been selling for around $250,000.  A couple of these units (about 1850 sq. ft. of living area) recently sold for $265,000 in Tuscany and Martinique at Abacoa.  The smallest single family homes, around 1750 square feet of living area, have recently seen some sales at or near the $400,000 mark...a price not seen in quite a while.  Part of the reason for the reduced inventory is that banks have been taking 4,5,6 months and more to reply to short sale offers. Therefore, many homes, although still listed on the MLS, are in a "Contingent" status awaiting replies from the banks, which effectively reduces the inventory, even though the units haven't actually sold yet. We're also seeing price increases in the nearby Heights of Jupiter as the mass flurry of short sales has subsided somewhat.  We've still got a long way to go to get back to a "normal" market, but these are positive signs for Abacoa and Jupiter in general.

Bang for your Buck: Home Renos in 2010

If you're like most people, expensive home renovations are not in the budget for 2010.  We all have grand ideas of how our homes could potentially be improved, but a brand new top-of-the-line kitchen may not be an option in these economic times.  Many homeowners are wondering how to spend their reno budget to get the most return, preparing for when they decide to sell.

2009 brought uncertainty to all aspects of the country's economy, including home renovations, as homeowners chose to invest in smaller, less pricey projects with big returns. According to Realtor Magazine, six of the 10 top renovation projects costed under $14,000.

Remodeling Magazine breaks down the return on investment per geographic area and for specific projects.  In the Miami, Fl geographic region (which includes Dade, Broward and Palm Beach counties) the highest return is replacing the entry door.  This is a very inexpensive update, costing an average $1,172, which yields $1,470, a 128.9% return.  The second best renovation is adding an attic bedroom, which yields an 83.1% return.  For a full list of renovations and their returns, visit Remodeling Magazine website.

 

Fixer Upper Home Loans

Do you love the idea of buying a junky house with tons of potential?  Are you handy or have an eye for renovating?  Do you watch too much HGTV?

I'm sure most of us answered yes to at least one of these (most likely the last one).  But with fixer uppers come some financing issues. One could be that you have enough for a down payment and monthly payments, but you don't have the cash to pay for renovations.  Another could be that you simply can't get financing on a home because its condition is too bad. 

What to do?  Get a 203K mortgage, that's what.  The Federal Housing Administration (FHA) provides home improvement loans, which lend homeowners and homebuyers the cash needed to renovate or rehabilitate a home. 

The minimum required loan amount is $5,000, and that initial amount comes with a set of requirements as to what the money can be used for.  Basically, it's for structural and functional uses, not merely cosmetic uses.  Although cosmetic items can be added once the minimun $5,000 is met.

The requirements for borrowers are the same as for any FHA loan.  The down payment is low, 3%-5%, but the rate is a little higher than for a standard FHA or conventional loan.

These are very accessible loans, so get out there and find your diamond in the rough.

For detailed information on the 203K program, click here.

Holiday Boat Parade in Palm Beach County

Yet another advantage of living by the water:  our holiday parade is on the water!  This Saturday, December 5 from 6:00-10:00 the Palm Beach Holiday Boat Parade takes off through the waterways, so find a good spot check it out.

While those poor souls up north are bundled up to their eyeballs trying to catch a glimpse of Santa in the parade on Main Street, we get to sit in lawn chairs wearing shorts, watching the twinkling of lights on beautiful boats.  Aaahhhh the joys of living in Florida.

Also the Riverwalk Events Plaza will be hopping with music and serving beverages and food from local vendors.  Make sure you bring a toy for the Toys for Tots drive to the Plaza- 'tis the season to make a child's Christmas joyful!

For more information and parade routes, visit http://www.jupiter.fl.us/CommunityDevelopment/HolidayBoatParade.cfm

Buyers and Sellers in a Bizarre Market

Most people agree that this is the most unusual real estate market in recent history.  Most would say buyers have all the power, but believe it or not, some areas have made a recent transition back to a seller's market.  Whichever way you look at it, it's a quickly changing market...especially when you look at some recent statistics.

After 14 months of year-to-year increase in existing home sales in Florida, October 2009 showed a 45% increase compared to October 2008; that's 15,160 sold last month versus 10,444 sold a year ago in the same month.  The median home price also decreased year-to-year by 17%, which is no doubt a cause of the increase in sales.

One reason for the lowering of home prices is the number of foreclosures and short sales in the Florida market.  In the third quarter of 2009, one in five homes were in some stage of foreclosure - somewhere between 90 days late on payments and being bank owned. These homes tend to sell below market value, bringing the average sale price and the value of neighboring homes down.  1 in 5: Florida leads the nation with this number.

Some say this upcoming flood of bank owned homes will further lower median home values.  Others have faith that the banks will release these homes for sale slowly, therefore keeping the values up, benefitting current home owners and the banks.

Sales are up 45%, yet foreclosures show no sign of stopping.  So is this a buyer's or seller's market?  In Palm Beach County, and likely statewide and nationwide, it seems to really depend on which neighborhood you're dealing with. From a Realtor's perspective, the inventory in neighborhoods like Abacoa in Jupiter, FL, has gone dramatically down since this time last year.  Where before I had a hard time narrowing down what to show buyers, I now have a hard time finding enough to show. 

If you are in a position to buy, go for it.  Rates are historically low and FHA government lending programs require very little money down, if any.  Though prices may dip slightly lower, rates could also go up, negating the lower prices.

If you're thinking about selling, you may want to consider that home prices, in most cases, will not be going up any time soon.  If you don't have several years to wait it out, then selling now might be your best option.  Though you might lose on the sale of your home, you will gain when taking advantage of the new lower sale prices when you purchase.

Bob Talks on Local News about Tax Credit: "Great for the Economy"

The Allen Group's own Bob Allen was interviewed recently by WPBF ABC local news regarding the home buyer tax credit extension.  To see the full article, click here.

Condo Lending Relaxes

After more than a year of stringent lending guidelines, the Federal Housing Administration is temporarily easing up on insuring loans on condominiums. 

Condos were hit hardest by the national housing decline, especially in Florida, and buyers have found it extremely difficult to get financing on condos.  The FHA has refused to lend at all in some condo buildings considered to be highly unstable.  For the more stable condo communities, they required 20%, 30% or even 50% downpayment from the buyer.

The FHA uses specific guidelines to determine whether a condo building is stable enough to lend in.  They consider the number of renters in the building versus live-in owners, the total number of units in the building that are FHA financed, the financial stability of the building, etc. 

The decision to loosen these guidelines is expected to boost the number of sales in struggling buildings and improve the condo market, helping to fill the units and lower the number of foreclosures. 

For some qualifying condo communities, buyers may be able to take advantage of the FHA low-downpayment program of only 3.5%, similar to those available for town homes and single family homes.

If you're considering purchasing a condo, this might be the perfect storm of buying potential: temporarily relaxed guidelines for condo financing, the home buyer tax credit available until April 2010, and very low prices on condos. 

 For condo listings in Jupiter, FL and all of Palm Beach County, click here.

Short Sales: How to Buy One

You found a house for sale, and it just so happens it is the one you've been dreaming about your whole life.  And it also happens to be a short sale.  What to do? True, it is getting harder to get short sales approved, BUT it is definitely still happening, especially in Palm Beach County where much of the market is short sales.  There are ways to increase your chances of getting the house you're dreaming of.  Here are a few questions to ask yourself or your agent when buying a short sale property. 

1)  Is my agent experienced in short sales? Most likely your agent will not be the listing agent of the home, so he or she will have limited power as far as handling the negotiations.  However, your agent can do all the research necessary to help you take care of #2-7 below before you make the offer.

2)  Who is the seller's lender?  Certain lenders can take much longer than others to approve short sales, such as Bank of America, Countrywide and Chase.  Also, if their loan is Fannie Mae backed, it extends the process even further.

3)  How many loans does the seller have?  If the seller has only one loan on the home, that is the best scenario.  Having more than one can cause the process to be extended and/or increase the chances of rejection.

4)  Am I making a reasonable offer?  Gone are the days when you could make a low ball offer and expect it to get approved.  A good rule of thumb is to make an offer no less than 90% below market value. Remember - 90% of market value is 10% better than full market value!

5)  Is mine the only offer submitted to the lender, per my contract?  Make sure there is a clause in your offer contract that yours will be the only offer submitted to the lender for short sale approval unless the bank rejects or counters it in writing.  In the case of a counter from the bank, you should make sure you have 48 hours first right of refusal. 

6)  Who is negotiating with the bank?  The person handling the negotiations with the lender can make or break the deal.  Your best bet is usually a real estate attorney specializing in short sales or a company whose sole purpose is to negotiate short sales.  They get their fees from the bank, so there's not an extra fee for you or the seller.

7)  Am I willing to be flexible?  When I say flexible, I mean mainly with time frames and money.  Banks rarely do anything when they say they are going to, and you need to be patient work with it.  Of course, having the right person (#6) calling them persistently helps.   Also, there will often be unexpected monies that need to be paid in order to close, such as homeowner's fees and liens that the buyer has failed to pay.  Those must be paid before closing and sometimes the banks will require the buyer to pays those.

Those are the basics of a buying a short sale. If you ask yourself and your agent these questions, you should be good to go.  Questions?  Email me.

 

Video Tour of Martinique at Abacoa - Hot New Listing!

Check out our brand new listing at 139 Soriano Dr. in Martinique at Abacoa in Jupiter.

Click here for a guided video tour:  http://www.youtube.com/watch?v=eebmI7Wy65g 

For more info and pictures, go to 139soriano.boballenhomes.com.  

Beautifully upgraded town home offers granite countertops and bamboo floors throughout downstairs and on staircase. Two master suites upstairs plus one bedroom and separate full bath downstairs makes this a very functional floor plan. Huge back patio has been recently painted, great for entertaining.Two car garage with attic storage. This home is unlike any other town homes in Martinique or Abacoa, with upscale ugrades that make it feel luxurious and warm. The location can't be beat - Martinique at Abacoa - close to shopping, restaurants, interstate and turnpike, Roger Dean Stadium and the beautiful Jupiter beaches. Community has a clubhouse and beautiful pool just for Martinique residents. Abacoa has tennis, basketball, racquetball and more, including a public golf course in the neighborhood. This is the best town house in a wonderful neighborhood!