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Housing Trends eNewsletter

MAY - 2013 Newsletter Housing Trends eNewsletter

Welcome to the most current Housing Trends eNewsletter. This eNewsletter is specially designed for you, with national and local housing information that you may find useful whether you’re in the market for a home, thinking about selling your home, or just interested in homeowner issues in general. Subscribe and receive a free monthly copy in your email.

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It’s still the right time to buy!

For a couple of years now I have been saying the time is right to buy. Many heeded the advice and did just that. As a result, those who did; today are a bit richer. It has been no secret that the real estate market in South Florida was poised to make a comeback. Many foreign Buyers flocked to Miami and took advantage of once in a lifetime opportunities.

Today, Miami continues to be a hot market and Buyers are buying it up. Inventory levels, which at one time seemed like they were going to hunt us forever; are now at their lowest ever.  This condition has been driving prices up and has created positive appreciation for those who bought as early as two years ago.

It is still not too late, although higher; prices are still way below their 2005 peak. I don’t expect them to reach those highs anytime soon; however, prices will gradually continue to rise.

Designed by Bjarke Lingels Group, amazing doesn't begin to describe the new swaying twin glass towers in Coconut Grove. The old and prestigious Grand Bay Hotel, once home to the world renowned exclusive club, Régimes, will make way for the Gove at Grand Bay. This ultra-luxurious development will not only feature an amazing view of the Bay of Miami from the 12 foot high floor to ceiling windows, it will offer exquisite amenities. Some of these amenities will include club dinning, club room, fitness center, children’s room, library, rooftop pool, spa and yes, a pet spa   

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Residences will begin at $2.8M to $21M for the penthouse. Owned and Developed by TERRA GROUP. For more information visit my website  www.Balconvertical.com .

New Guidelines for Short Sales

As of November 1st, 2012, new guideline for short sale without additional approval from Fannie Mae/Freddie Mac will include death of a borrower, divorce, disability or relocation for a job. According to FHFA Acting Director Edward J De Marco, “these new guidelines demonstrate FHFA’s and Fannie Mae’s and Freddie Mac’s commitment to enhancing and streamlining processes to avoid foreclosure and stabilize communities.”

What should a Buyer consider when making an offer to purchase real estate in today’s market?

Today buyers are faced with many obstacles when making an offer for a property. Due to the recent low in inventory levels, buyers are confronted with multiple offers for the same property. This dilemma is worsened when one of those offers is cash – cash is king. Finding he right financing is also  becoming more difficult, particularly for first time home buyers.

Here are a few things to consider. First, a buyer should be well aware of what price home he or she or couple qualify for. Your local bank or mortgage broker will be able to help with this. You will not have to use the lender who prequalified you. You can later find the Lender of your choice to make  the actual loan.

Make your offer as strong as you possibly can.  To do so, the Buyer needs to do the following.

Line up all the resources you will need in order to comply with the terms and conditions of contract.  You will need a lender, property inspector and title attorney for the closing (if purchasing a distress property (short sale, foreclosure, REO, etc), the title attorney or company will most likely be chosen by the Seller). It is important that you discuss the timeline with these professionals. The less time you ask for in your offer to fulfill the contract contingencies the stronger your offer will look to the Seller.

Simultaneously with the above, you should be searching for property within your budget, never exceeding more than 3-5% over the amount you qualified for (3-5% may be negotiated off the listing price-hard to say in today’s market). A real estate agent can help you with your search and the offer amount. Today Buyers need to be really careful when negotiating on the purchase price. Being too aggressive could steer the Seller towards another offer. In fact, today many offers are being made for full asking price and sometimes for more. If offering more, on needs to understand that this could be a problem if the property doesn’t appraise for the amount offered. If the property doesn’t appraise, the Buyer has to either pull out money from his or her own pocket to cover the difference or cancel the contract. Remember, although price isn’t always what determines the strength of an offer, for many Sellers it is at the top of the list.

When making an offer, the Buyer should consider the following.

·         The size of the loan that they qualify for before they begin to look for property.

·         Can they afford to offer more than the asking price?

·         Terms and conditions of the offer - Buyers should carefully consider how much time they should ask for in order to cure the financing and inspection contingencies, and how soon they can close. Consult with the professionals you will be working with before you make your offer. Remember that the time set in the contract for the mentioned items above will have to be met or you will be in default of contract.

·         If possible, present your offer with a loan commitment letter from your lender (this shows that you have a committed lender for the purchase). By doing this, the timeline can be shortened, making your offer stronger, particularly against a cash offer. It is important to know, once the commitment letter is issued to the Seller, the Buyer waives the right to cancel due to financing (every transaction is unique and a professional should be consulted before submitting an offer).

·         Inspection period should be as short as possible. Typically, an offer allows between 10 and 15 days, however, with the technology available to property inspectors, inspectors can usually perform the inspections and issue a report in 48 hours (must discuss the timeline for the physical inspection and report with the inspector in advance of the offer). Note, with the bounce back of the RE market, many inspectors are very busy and may need more time. Also, the number of inspections will affect the amount of time needed.

Record low interest rates!

Record low interest rates! According to Freddie Mac, the 30 year fixed rate is at 3.78, the lowest since mortgage rate tracking began back in the 1950s. According to the Feds, they will keep interest low through 2013; however, the 30 year rate will likely hit 4.5% in 2012 and 5.4% for 2013.

Time to buy!!!!