You’d think the appraisers would take this into account when valuating homes that do not involve banks, but who do you think hires appraisers? Appraisers raised appraisals for banks during the boom and now lowering appraisals in the bust. I don’t know about you, but that’s not exactly a free market system setting prices is it?

I remember the days when home sellers would not accept a price for their home out of concern they would bring the value of their friend’s home down the street. Well, the banks don’t care about this and we’re at their mercy to set home prices.

A significant proportion of home sales in SW Orlando this past year involved banks this past year and their actions will have a significant impact on our home’s value…. not in a good way neither.

For a healthy market to return to our area, artificial manipulations have to cease and that won’t happen until the foreclosures and short sales are mostly gone.

I don’t know when that’ll be, but you can be assured that the worst is over.

As many of you have noticed, the price of housing has come way down in the past few years. In many cases, it’s now cheaper to buy then to rent. No joke. It’s a reality which I don’t believe many people realize.

Let’s take a $130,000 home which is the median price of a home in Orlando currently. The mortgage amount on that home would be $125,450 on an FHA loan with the principal and interest payments being $748.39. You add taxes and insurance to the whole thing it’s still only about $900. There’s a fee called the MIP premium with FHA loans and that’ll probably puts you around the $1,000 mark. It’s basically what you’ll have to pay for a pretty crappy apartment.

On top of all that, you get $8,000 in cold hard cash if it’s your first home. Home buyers who’s lived in their residence for at least 5 years can get a credit up to $6,500. These tax credits are also now available to individuals earning up to $125,000 or couples up to $250,000 although there’s fewer of us in this particular earning situation.

You also get to write off most the interest and taxes on your new home which should mean a deduction around $10,000 from your income taxes for a property in the price range used in the example above.

It’s a great time to buy, but you’re not gonna make money on appreciation overnight. My suggestion is that you plan on staying in the property you buy a minimum of 5 years and preferably 10 years. The days of flippin real estate are over, but look at all the advantages you have in buying right now.

Your payments don’t go into some black hole like when you rent, they go towards increasing your tax deductions, accumulating equity, and the value will eventually increase although it may not be real soon.

The inventory levels in Orlando have finally come down to a reasonable 6-7 months which is typical of a stable market and prices have already come down 50% or more in many areas.

I’m not a fortune teller and can’t predict what the market will do but heck, look at all the savings you get even if prices stay stagnant for an extended period of time.

So I guess the answer is “heck yeah it’s cheaper!”.

Homeowners in the townhouse community of Phillips Bay in Dr. Phillips filed a lawsuit against the builder, Deluca Homes, in 2007 due to mold, missing stucco, and patios that are not structurally sound. The civil case is scheduled to be heard October 12.

Deluca Homes has also built the same style of townhouses in Carriage Homes at Della and most recently, Toscana. There’s already been a civil case against the builder in Carriage Homes at Della, so it’ll be interesting to see if one arises in Toscana although the style of construction was different.

Anyone considering buying a home here should find out more about the lawsuit before purchasing and whether or not the faulty construction is affecting the unit you’re buying.

Just because there’s a lawsuit doesn’t mean there’s something actually wrong, but you could be getting into a situation that requires a lot more attention than you’re willing to give.

My suggestion is to stay away until things get settled.

There’s been a big push among lenders for the FHA home loan. The advantage of this product is that it allows a buyer to get into a home with as little as 3% down. It’s really a nice choice for a loan, but it can be difficult to obtain if you’re looking for a condo.

One of the main reasons a condo building is not FHA approved is the guideline that requires a condo to be at least 50% owner occupied. We all know we had investors come into the SW Orlando marketplace by the bus load during the peak and many of them pushed numerous condos beyond the approved guidelines not to mention many of them are in foreclosure making the problem even worse.

Either way, I’ve compiled a list of FHA approved condos in Dr. Phillips, Metrowest, Windermere, Hunters Creek, Winter Garden, Clermont, and Celebration:

• Dr. Phillips: Windhover, The Point Orlando Resort
• Metrowest: Stonebridge Lakes, Stonebridge Commons, Stonebridge Place, Stonebridge Reserve, Golfview, Crestview
• Windermere: Oasis at Lakeside Village
• Hunters Creek: Golfview, Fountains at Crystal Creek
• Winter Garden: Tucker Oaks
• Celebration: Waterstreet at Celebration

To look up any condos not mentioned here, check out the FHA Approved Search on the HUD website.

I tried to look up Vizcaya and Toscana in Dr. Phillips, Veranda Park in Metrowest, Lakeside at the Lakes of Windermere, and Artisan Park in Celebration but they’re not listed on their site. They were probably beyond the FHA loan limit for Orange County, FL of $274,850 and now they’re priced in this range. My suggestion would be to contact your lender.

When a listing mentions a short sale, it means the seller owes more than the asking price. More and more short sales are getting approved but it will test your patience as the process typically takes at least 3 months and in many cases much longer.

If time is short, especially those trying to take advantage of the first time home buyer tax credit that’s expiring soon, then I’d probably focus more on approved short sales.

Buyers often cancel short sales because of the lenghty process so when these properties come back on the market, the next buyer can get an answer from the bank in about a week.

Just as with foreclosures, don’t assume a home is a good deal because of the “short sale” label. Consult with someone that’s knowledgeable about the local market…. aaah like me.

Click here to view the embedded video.

I noticed this post on the Bloodhound Blog yesterday, HR 2801: Will Home Ownership Move the Economy? about the new bill in congress to extend the home buyer tax credit. It’s up for vote in the House and will also require approval from the Senate but it’s a fantastic bill.

It removes the income limitation on the current home buyer tax credit and it raises the credit from $8,000 to $7,500 for 2 years or $15 grand which sounds even better.

If this bill passes, you’d have to be a idiot to rent instead of owning a home provided you can qualify for a loan with the more stringent lending requirements imposed by the lenders in this current climate.

Let’s all hope it passes.

Click here to view the embedded video.

Everyone’s saying it’s a good time to buy, but they were saying that during the boom in ‘04 to ‘06 and you know a bunch of people stuck in their house.

I can’t honestly say I’m a fortune teller but I’ve got this funny feeling it’s a good time to buy a house provided you plan on staying for at least 5 and preferably 10 years, you’re not going for an adjustable rate mortgage and stretching to make the monthly payments, and most of all, you’ll like what you can afford.

The American Recovery and Reinvestment Act of 2009 passed in February, but I really haven’t seen too many first time home buyers in the market until recently. It seems like there’s a lot of procrastinators out there, but the good news is there’s plenty of time and lots of great deals out there.

Keep in mind that you need give yourself enough time because you’re gonna be competing with all the other people who’ve procrastinated as well as the bottom feeder investors who are coming back in the market in droves.

A typical foreclosure home for sale will see multiple offers with many of them being cash, so you’ll lose out on a few before you actually get one. It’s a bummer, but a fact of the market at the moment.

Many of you will be going FHA financing which will require flooring, kitchen appliances, and door handles which are commonly missing from foreclosure properties.

One bit of advise that I can give is that there’s lots of great deals out there besides foreclosures and the label foreclosure doesn’t mean it’s a good deal.

Also remember that government is offering a tax credit and not a check. Here’s a few key points to remember:

Credit maximum was increased from $7,500 to $8,000. The credit is calculated as 10% of the
purchase price. Example: If the purchase price is $70,000, the credit is $7,000.

Removed the repayment requirement, provided the home buyer does not resell the home for three
years.

Eligibility remains for first-time home buyers only. In this case, a first-time homebuyer is defined as
an individual who has not owned a primary home at any time during the three years prior to
purchase, but who may have done so prior to that time. Although certain income limits do apply, the
amount of the credit is the same for all taxpayers, married or single.

To be eligible for the full tax credit, the home buyer can have an annual adjusted gross income of no more than $75,000 ($150,000 on a joint return). A home buyer with an annual adjusted gross
income above that level, and up to $95,000 ($170,000 on a joint return), is eligible for a reduced tax
credit.

The refundable tax credit can be claimed on the purchase of one’s individual or joint tax return for any single-family home that closes between January 1, 2009 and November 30, 2009. It can be claimed on a 2008 tax return (to be filed by April 15, 2009), an amended 2008 tax return, or a 2009 tax return. Individuals should consult a professional tax adviser for specific details and restrictions on exact tax calculations and timing.

Like I said earlier, I’ve got this feelin it’s a good time buy a first home. If you feel it’s time, give yourself enough time by allowing for at least 3 months to find a home and don’t get bummed out when you get beaten out by some investors paying cash. It’s probably gonna happen and you just gotta find another one.

Thanks to the adoption of the internet by the real estate industry, the days of having to drive countless hours is a thing of the past. Nowadays, you can refine the areas and homes you’d like to look at on the internet before hopping in the car making the process a heck of a lot more efficient.

This means if you don’t have web appeal, buyers won’t take the time to drive by your home. The curb appeal you’ve worked so hard on in preparation to sell your home doesn’t do any good unless it also looks good on the internet.

So how does one go about creating web appeal?

First and foremost, get a great picture of the front of your home. It’s the only exposure to home buyers most home buyers get. If buyers don’t like first photo, then they just move on to next gazillion properties that are also on the market.

You’ll also need lots of photos. The chances of a buyer coming to see a home will increase greatly with more photos. Just make sure they’re good photographs. I mean at the very least, make sure the photos are straight, correct the white balance, and watch out for those really bright windows.

Buyers also want a great description to go along with the photos.

I’ve had tons of buyers asking for an appointment excited because of the way a home looked on the internet. Home sellers have a way better chance of getting buyer’s interests on the internet than a traditional real estate sign or stunning curb appeal.

Posting property information on social networks like Facebook and Twitter as well as local blogs are great ways to stand out from the crowd.

If you don’t have web appeal, a large percentage of potential home buyers will not see your home. Make sure you pay close attention to your home’s web appeal. It’s more important than curb appeal in today’s marketplace.

They’re both warranty deeds, so what the hecks the difference? It sounds like a lot of lawyer mumbo jumbo but in the big scheme of things, the difference between these conveyance instruments can be crucial.

A general warranty deed guarantees the home buyer that the seller will warranty any prior problems with title, not just during their ownership but anywhere along the chain of ownership.

For example, if 123 Main St. was built by Moe, then sold to Larry who sold it to Curly, then when Curly sells it to some other knucklehead, the title is guaranteed all the way back to when Moe owned it with a general warranty deed. If 123 Main St. was sold by Curly with a special warranty deed, then the chain of title is only guaranteed back to the days of Curly’s ownership. So if there was screw up in the way the title was conveyed between these 3 guys, then the new owner would be S.O.L and Larry and Moe would be taking it out on Curly when the new owner finds out there’s a break in the chain of title.

It’s because of such knucklehead maneuvers that we have title insurance to guarantee title in modern day real estate. That’s not to say everything’s gonna be O.K. with title insurance since there’s quite a few exceptions to the policy like any other insurance.

I’d probably be aware of those exceptions if I were buying a home from a builder or one from the bank. It might be a good idea.