fbpx

Monthly Archives: February 2022

Multifamily: FHA Nixes Tough Pandemic Loan Rules

Multifamily project developers will find it easier to secure FHA loans after the agency eased tough standards introduced early in the pandemic.

WASHINGTON – The Federal Housing Administration (FHA) announced at the Mortgage Bankers Association Commercial/Multifamily Finance Convention & Expo that it’s removing temporary COVID-19 underwriting standards for multifamily transactions insured under Section 223(f) of the National Housing Act.

The change went into effect immediately and applies to all insured transactions that have not yet been endorsed.

The temporary requirements – nine months of debt service reserves, 250% repair escrows and limits on cash-out refinance transactions – originally went into effect in April 2020 when FHA feared the potential financial impact of the COVID-19 pandemic. In the almost two years since then, however, the FHA Multifamily portfolio has proven resilient, remaining at a less than one-percent default rate.

“Through actions taken under the Biden-Harris Administration to help the nation recover from the pandemic, including the historic American Rescue Plan, mortgages in FHA’s Multifamily insurance portfolio experienced fewer challenges than expected,” says Lopa Kolluri, principal deputy assistant secretary for the Office of Housing and FHA. “Because of this, we are in a position to unleash multifamily development capital by lifting these underwriting safeguards.”

This change allows lenders to once again use the standard Multifamily Accelerated Processing (MAP) Guide policies going forward, which require fewer capital reserves to be held for debt service, a lower percentage of capital held in repair escrows, and more flexible requirements for the treatment of cash-out refinance transactions.

“FHA multifamily mortgage insurance helps to create much-needed rental homes in communities nationwide,” says Ethan Handelman, deputy assistant secretary for multifamily housing. “Returning to our normal underwriting safeguards will put more capital to work for affordable housing.”

© 2022 Florida Realtors®

https://www.floridarealtors.org/news-media/news-articles/2022/02/multifamily-fha-nixes-tough-pandemic-loan-rules

DOJ Focusing on Appraiser Fair Housing Lawsuit

The Civil Rights Division filed a “statement of interest” in a San Francisco appraisal case where value rose by $500K after removing signs of Black ownership.

ST. LOUIS – The Department of Justice’s Civil Rights Division on Valentine’s Day filed a statement of interest in a private discrimination lawsuit where the homeowners allegedly received an appraisal for nearly $500,000 less than the actual value because they are Black.

In 2020, Tenisha Tate-Austin and Paul Austin, a Black couple in San Francisco, sought to refinance their home mortgage. Janette Miller, a licensed appraiser, named a defendant in the lawsuit, appraised the couple’s home at $995,000. However, a few weeks later, another appraiser set the home’s value at $1,482,500.

They received the second and more significant appraisal after getting a Caucasian friend to pose as Tate-Austin.

The couple said Miller used coded phrases like “Marin City is a distinct area” when she valued the property. They said those comments were related to their race and complained to their mortgage lender.

For the second appraisal, they hid photos and artwork with distinguishing African American characteristics and replaced them with those belonging to their white friend.

“We had a conversation with one of our white friends, and she said, ‘No problem. I’ll be Tenisha,” Tate-Austin told reporters last month. “I’ll bring over some pictures of my family.’ She made our home look like it belonged to her.”

The couple filed a fair housing discrimination lawsuit against Miller and her company, Miller and Perotti Real Estate Appraisers, Inc., and AMC Links, LLC.

Miller and her company have filed a motion to dismiss the case, claiming that the couple failed to state a claim upon which a court could grant relief.

“The United States respectfully submits [our] statement to provide an overview of the FHA and to address two questions of law raised in the defendants’ motion,” the DOJ said in a statement.

“The defendants assert that the FHA does not apply to residential appraisers. The statute’s text and caselaw make clear that it does. Second, the defendants lay out the elements of a prima facie case and argue that the plaintiffs have failed to allege these elements,” the DOJ stated.

“But the plaintiffs need not allege facts that make out a prima facie case at this stage. The act simply requires that the plaintiffs allege a plausible entitlement to relief as a result of the defendants’ “discriminatory housing practices.”

Austin said he and Tate-Austin researched the market well and upgraded their home before the first appraisal.

“We did our homework,” Austin told the Reparations Task Force in a panel on the racial wealth gap in October. “We believe the white lady wanted to devalue our property because we are in a Black neighborhood, and the home belonged to a Black family.”

© Copyright 2022, St. Louis American, all rights reserved.

https://www.floridarealtors.org/news-media/news-articles/2022/02/doj-focusing-appraiser-fair-housing-lawsuit

Teardowns Return as the Cost of Land Rises

WEST PALM BEACH, Fla. – They built their homes as stalwart as their ethos – all cinderblock and right angles, no nonsense, no frills. It was the style of the Greatest Generation who found their way to South Florida after the Second World War by way of Morrison Field, now Palm Beach International Airport.

Squat and plain, the single-story houses filled gaps between the 1920s Spanish Mediterranean romantics and the balconied Monterey Colonials in West Palm Beach.

But with vacant dirt east of Interstate 95 scarce, a pandemic growth spurt, and a downtown business boom, the 1950s-era homes are toppling like sandcastles at high tide. Larger, taller, more efficient structures are the new tenet.

“We’ve had four teardowns in the past two years,” said Sunshine Park Neighborhood Association President Dennis Perry at a West Palm Beach Historic Preservation Board meeting in January. “We are very concerned about new construction, some of which is incompatible in size, scale and proportion.”

Sunshine Park, a century-old community of 130 properties south of downtown, is pursuing historic designation after seeing unsettling demos and rebuilds, including the razing of a 1920s-era mission-style house.

The Historic Preservation Board is a sentry for homes in the city’s 17 protected districts. But permit requests citywide for significant demolitions of parts, or all, of a single-family residence reached about 115 last year, a 49% increase over the average between 2018 and 2021, and a 68% jump from 2020, according to city records.

More than 1,300 historic reviews were conducted by city staff in 2021, up from 1,070 in 2020 and 950 in 2019.

And it’s not just the rectangular ranches and stripped-down “minimalist traditional” homes that are succumbing to the wrecking ball. A 1927 Spanish-style home with a stately tower and pecky-cypress ceilings in the South of Southern, or SoSo, neighborhood was approved for demolition last year. The home, which was not in a historic district, was bought in September for $2.2 million by a limited liability company.

West Palm Beach Historic Preservation Planner Friederike Mittner called the demo “heartbreaking.”

“We happened to see the permit and tried to call the owners,” Mittner said. “We made a pitch – designate it, move it – but there wasn’t interest.”

There were two distinct historical land booms in South Florida. The frenetic migration in the 1920s unloaded sunshine-seekers from Henry Flagler’s railroad into West Palm Beach by the scores. The ballooning population resulted in what The Palm Beach Post characterized in 1925 as “the most acute housing shortage in the city’s history.”

From 1920 to 1925 West Palm Beach’s property values increased from $13.6 million to $61 million. The boom was chilled by the hurricanes of 1926 and 1928.

The 1950s saw the return of World War II veterans and a migration south that spurred the post-war “infill homes” that grew between the more distinct 1920s architecture.

Amanda Skier, president and CEO of the Preservation Foundation of Palm Beach, and chairwoman of the West Palm Beach Historic Preservation Board, lives in the El Cid historic district in a 1955 concrete-block ranch-style home. She said at one time there were four in a row on her street. Two were demolished and one added a second floor.

“Mine is the last one,” said Skier, who worked with Mittner to individually designate her house to protect its historic integrity. “It tells an important story about the history and development of our area.”

Four blocks south of Skier in a carve-out pocket of El Cid that is not part of the historic district, a 1953 home was crunched into chunks and hauled away earlier this month.

Just eight houses west of the Intracoastal waterway, the property changed ownership twice in early 2021. It sold in January for $500,000, and then again in March for $768,750, according to Palm Beach County Property Appraiser records.

Owner Tom Cush, who is moving from New York to West Palm Beach, said he and his wife wanted to save the concrete block-and-stucco home, but it had mold inside. Their architect eventually told them it was cheaper to tear it down than to repair and remodel it.

“New roof, new plumbing, new electric. The kitchen was a Lilly Pullitzer pink and green,” said Cush, who at 6-foot-4 was also concerned about ceiling heights. “We were going to be left with a shell. They said you would be better off starting from scratch.”

The new 3,000-square-foot home will be built in the British West Indies style – two stories high with elements from 18th- and 19th-century architecture brought to the Caribbean by the British.

At the four-and-a-half-hour-long January historic preservation board meeting, six homes were on the agenda for demolition approval. Realtor and Flamingo Park resident Linda Cullen spoke against allowing the destruction of a 1946 home on Kanuga Drive where a developer wanted to split the lot and build two new houses. Dividing lots is a trend Mittner said she is seeing more of in the historic communities.

Cullen said the request was “simply a matter of taking advantage of the market,” and that a historic home shouldn’t be sacrificed for selfish reasons.

The preservation board agreed, denying the demolition request.

But they did allow for two key teardowns of homes next to each other on Flagler Drive along the Intracoastal Waterway. The demolitions and rebuilds will add to already weighty changes in appearance and property values on the waterfront.

Neither structure – built in 1960 and 1952 – contributes to the historic designation of El Cid. The demolition of the 1952 home near the corner of Flagler and Valencia Road was not considered “irreparable to the district or the city.”

But the lack of historic designation was likely by choice.

As many as 35 homes were allowed to opt out of historic status in a 2008 resurvey of the neighborhood to add homes that weren’t old enough to qualify when the neighborhood was originally designated in 1995. That opt-out left many 1950s-era homes vulnerable to annihilation.

El Cid resident Nancy Pullum bristled at the idea the teardowns would not cause irreparable damage.

“I’m alarmed at the casual write-off of midcentury houses because of market pressures,” said Pullum, who has lived in El Cid for more than three decades. “To say they are no loss is something I object to strongly. They are part of the fabric of the neighborhood.”

Steve Simpson, an El Cid resident and Realtor, said extra pressure is being put on West Palm Beach’s historic communities because buyers are clamoring for homes east of I-95. Some millionaires who once eyed Palm Beach have been priced out and consider a home near the water in West Palm Beach the next best thing, he said.

Also, he’s recently had clients who are moving from Palm Beach to West Palm Beach after getting unsolicited offers on their island homes that they found hard to refuse.

“From I-95 east, we are in for a wild ride,” he said. “We’re witnessing something very unique in the history of West Palm Beach and we just have to manage it properly.”

That likely means more lengthy meetings of the historic preservation board.

“People do like the character of the neighborhood,” Pullum said about El Cid. “But at what point do you lose the sense of charm that originally attracted them?”

© Copyright 2022 Palm Beach Newspapers, Inc.

https://www.floridarealtors.org/news-media/news-articles/2022/02/teardowns-return-cost-land-rises

1 of 4 Realtors Works as Part of a Team

However, one size does not fit all. A coaching firm identified five team models: referral agent, partnership, standard team, group and mega group.

WASHINGTON – A recent survey by the National Association of Realtors® found that 26% of members belong to a real estate team – and 30% are considering joining one.

Business coaching firm Buffini & Company identified five types of team models:

  • Referral agent (creates low-cost expansion)
  • Partnership (multiplies agents’ efforts)
  • Standard team (shows commitment to growth)
  • Group (facilitates significant growth)
  • Mega group (operates like a profitable brokerage)

“When it comes to building a team, one size does not fit all,” says Brian Buffini, founder and chairman of the company. “You’ve got to have a personalized, customized approach. All five models can be extremely profitable.”

A coach can help guide the process, which often starts by hiring an assistant who can help recruit and retain promising individuals. It’s also essential to determine the different roles each individual will play on the team.

For example, one agent might handle buyer phone calls on listings, while another may be in charge of hosting open houses or writing purchase offers. Duties may overlap, but the goal is to secure talented agents who align with the business’ values and leaders’ approach to business.

A reliable customer relationship management system allows leaders to easily organize the management and performance of the team and get instant feedback on how their leads are converting.

Training is the best way to transfer the leader’s values, techniques, and expectations to the team to ensure a strong reputation while serving clients at the highest levels.

Source: RISMedia (02/07/22)

© Copyright 2022 INFORMATION INC., Bethesda, MD (301) 215-4688

https://www.floridarealtors.org/news-media/news-articles/2022/02/1-4-realtors-works-part-team

Fla. Home Sales, Median Prices Up in Jan.

Florida Realtors: Statewide single-family home sales up 1.4% year-over-year, median price up 23% to $375K. Condo sales up 6.7%, median price up 23.9% to $285K.

Sales stay up in Florida, even though rising interest rates and low inventory could be making it harder for some folks to afford a home. Take a closer look at how the new year started for real estate across the state.

ORLANDO, Fla. – Even as the pandemic continues into 2022, Florida’s housing market reported more closed sales and rising median prices compared to a year ago, according to Florida Realtors®’ latest housing data. Single-family existing home sales were up 1.4% last month compared to January 2022.

“2022 began with market conditions similar to what we saw over the previous months, including high buyer demand and a lack of inventory in many areas across the state,” says 2022 Florida Realtors President Christina Pappas, vice president of the Keyes Family of Companies in Miami. “This shortfall in inventory continues to put pressure on home prices. When homes are available for sale, they’re going under contract very quickly: The median time to contract statewide for single-family existing homes in January was 14 days compared to 21 days during the same month a year ago. And the median time to contract for existing condo-townhouse units was 16 days compared to 39 in January 2021.”

Last month, closed sales of single-family homes statewide totaled 21,885, up 1.4% year-over-year, while existing condo-townhouse sales totaled 10,252, up 6.7% over January 2021. Closed sales may occur from 30- to 90-plus days after sales contracts are written.

The statewide median sales price for single-family existing homes was $375,000, up 23% from the previous year, according to data from Florida Realtors Research Department in partnership with local Realtor boards/associations. Last month’s statewide median price for condo-townhouse units was $285,000, up 23.9% over the year-ago figure. The median is the midpoint; half the homes sold for more, half for less.

According to Florida Realtors Economist and Director of Housing Statistics Erica Plemmons, analysts will be watching mortgages rates in the coming months to weigh their impact on market conditions.

“The strong uptick in the 30-year fixed mortgage rate, means John and Jane Doe need to cross their t’s and dot their i’s before signing on the dotted line,” she says. “A home price that they could afford at 3%, may not be as comfortable at 3.5 or 4%. Still, there’s a strong incentive to purchase a home as rents are also rising.

“As we get more data for 2022, we will have a better understanding of how much of Florida’s demand could ease as interest rates likely increase to levels homebuyers haven’t seen in three years.”

On the supply side of the market, inventory (active listings) continued to be limited in January. Single-family existing homes were at a very restricted 1.0-months’ supply while condo-townhouse inventory was at a 1.2-months’ supply.

According to Freddie Mac, the interest rate for a 30-year fixed-rate mortgage averaged 3.45% in January 2021, significantly higher than the 2.74% averaged during the same month a year earlier.

To see the full statewide housing activity reports, go to the Florida Realtors Newsroom at and look under Latest Releases or download the January 2022 data report PDFs under Market Data on the site.

© 2022 Florida Realtors®

https://www.floridarealtors.org/news-media/news-articles/2022/02/fla-home-sales-median-prices-jan

Dislike CFPB Rules? Ask Them to Change It

The nation’s consumer bureau says the public can now submit rule-making petitions directly, and they’ll be posted on public dockets for review and comments.

WASHINGTON, D.C. – The Consumer Financial Protection Bureau (CFPB) says it made it easier to engage with the agency and request regulatory changes. Effective immediately, members of the public can submit petitions for rulemaking directly to the CFPB that will then be posted on public dockets for review and comment.

“Americans should be able to easily exercise their Constitutional rights without hiring a high-priced lawyer or lobbyist,” says CFPB Director Rohit Chopra. “Our new program will broaden access to the agency’s rulemaking process.”

The U.S. Constitution guarantees the public’s right to petition the government, and the right to do so isn’t new. However, CFPB says its new system will end some confusion because “many individuals and small businesses believe that they must hire former government officials, lawyers or lobbyists in order to be heard by an agency.”

Petitioners, CFPB says, can request a new rule, amend an existing one or repeal a rule. The change only applies to members of the public. It asks former government employees and individuals paid to influence the agency’s rulemaking agenda to submit their petition for public inspection instead.

More information about the rulemaking petitions process, including how and where to submit petitions and comments on petitions, is posted on CFPB’s website.

Consumer complaints about specific financial products or services should be submitted through the CFPB’s complaint website.

© 2022 Florida Realtors®

https://www.floridarealtors.org/news-media/news-articles/2022/02/dislike-cfpb-rules-ask-them-change-it

Proposed Amendment Would Help Hometown Heroes

Florida Realtors will back a proposed state constitutional amendment that gives front-line workers, such as police and teachers, a property tax break.

TALLAHASSEE, Fla. – Florida Realtors® announced it would support a proposed constitutional amendment – HJR 1/SJR 1746, reinforcing its commitment to make housing more affordable for some of Florida’s most dedicated workers.

The proposed constitutional amendment grants an additional homestead exemption for teachers, firefighters, law enforcement officers and other Floridians who have selflessly helped the state’s residents throughout the COVID-19 pandemic. If approved by the Florida Legislature, the measure would go on the general election ballot as a proposed constitutional amendment.

“For decades, Florida Realtors and its more than 225,000 members have been vocal advocates for affordable housing,” says Florida Realtors President Christina Pappas. “Our state owes so much to the dedicated men and women who have done so much for us. HJR 1 and SJR 1746 will help by providing much-needed property tax relief to hometown heroes in our state.”

In light of escalating housing costs, Florida Realtors has also supported the creation of a Florida Hometown Hero Housing Program (SB 788). If approved by the Florida Legislature and signed by Gov. Ron DeSantis, it would offer zero-interest loans and help with down payments and closing costs for essential professions including nurses, firefighters, teachers and law enforcement.

Pappas commended Florida House and Senate leadership for proposing HJR 1/SJR 1746, which would help many hometown heroes who already own a home.

“HJR 1/SJR 1746 and SB 788 pair perfectly together and make a compelling statement to the men and women who serve our state, our communities and our country that we support them. We want to make sure they have a chance of achieving the American dream of homeownership,” says Pappas.

HJR 1, sponsored by Rep. Josie Tomkow and the Ways & Means Committee, and SJR 1746, sponsored by Sen. Jason Brodeur and the Finance and Tax Committee, would increase the homestead exemption on non-school levies for property owned by teachers, law enforcement officers, correctional officers, firefighters, child welfare services professionals, active-duty members of the U.S. military and members of the Florida National Guard.

According to Florida Realtors data, the median sale price of a Florida home was just under $374,000 at the end of last year – 21% higher than just one year earlier and 47% higher in just three years. The average salary in many of the targeted occupations is less than what would be required to afford such a home.

“These dedicated hometown heroes have served Floridians non-stop through the pandemic,” Pappas says. “However, amid skyrocketing housing costs, many find that they can’t afford to live in the communities they serve. Our goal is to make homeownership more affordable for them, and we look forward to working with lawmakers to give these workers a helping hand.”

© 2022 Florida Realtors®

https://www.floridarealtors.org/news-media/news-articles/2022/02/proposed-amendment-would-help-hometown-heroes

Hot Real Estate Market Impacted ‘Opportunity Zones’

Fla. has over 400 Opportunity Zones to create affordable housing and encourage development, but rising prices and demand have dampened their impact.

TAMPA, Fla. – The 2017 tax reforms signed into law by former President Donald Trump created what’s called a qualified opportunity zone to encourage home construction in low-income areas. Florida is home to over 400 of these zones, where the U.S. Census Bureau identified concentrations of low-income residents and a need for more affordable and workforce housing.

The affordable housing construction program has kept home prices lower in some areas, but costs still rose significantly along with the rest of the U.S. housing market.

A study by real estate data curator ATTOM found home prices in 56% of the opportunity zones went up by at least 20% from October to December of 2021. While price increases were lower in opportunity zones, cost surges did occur even where financial opportunity exists to keep housing affordable.

According to the Florida Department of Economic Opportunity, the 2017 Tax Cuts and Jobs Act allows state governors to designate up to 25% of their low-income census tracts for use as an opportunity zone. And construction companies building housing on those locations got big financial boons for doing so. Builders whose bids were accepted for development in the zones were able to have their capital gains taxes deferred and reduced for years.

“Investments are made in Opportunity Zones through U.S. Treasury Qualified Opportunity Zone Funds, which must invest over 90% of their assets in Qualified Opportunity Zone properties and businesses,” according to a statement from the DEO  “Qualified Opportunity Zone Funds attract investors through possible tax benefits.”

The financial benefit of the zones gains value over years, depending on how long the funding investment is held. The DEO says the benefits for construction companies are aimed to continue through at least the end of 2026, if not longer.

  • Taxes are deferred on capital gains rolled into Qualified Opportunity Zone Funds and the original tax bill through Dec. 31, 2026, or the sale of the Opportunity Zone investment, whichever is earlier
  • Taxes are reduced on capital gains held in Qualified Opportunity Zone Funds for certain lengths of time; for investments held for five years, the cost basis for tax purposes is increased by 10% and for investments held for seven years, the cost basis increases an additional 5%
  • The rolled over capital gain appreciates tax-free if the investment in the Qualified Opportunity Zone Fund is held for 10 years or longer

As municipalities work to address housing needs that have only increased since the passage of Trump’s tax law, the pricing issue remains a core difficulty in America’s economic situation.

The ATTOM study found that of the more than 5,000 zones they surveyed at the end of 2021, the single-family homes in more than half of the country had their prices jump 16.1%. At a time when real estate values are rising every month and inventory continues to shrink, ATTOM said the median prices in 76% of the opportunity zones had risen beyond the 16% national gain.

Prices in the qualified opportunity zones, areas of between 1,200 to 8,000 residents, grew as part of the same 10-year surge experienced in the rest of the U.S., according to ATTOM.

“Gains in Opportunity Zones again pretty much matched what was going on elsewhere and even beat out the rest of the market in some ways,” said Todd Teta, chief product officer with ATTOM. “While Opportunity Zone markets remained depressed, the increases probably reflected the trickle-down effect of buyers priced out of more expensive neighborhoods. The gains also represented an ongoing sign of vitality in lower-income areas – something that ups the ante for investors looking to take advantage of Opportunity Zone tax breaks.”

Teta also said the neighborhoods near the poorest parts of the U.S. rose the national housing boom throughout the end of 2021, even as the speed of the price increases slowed down. In Florida, the DEO provides a map of different locations that could qualify for the development program. The U.S. federal government provides their own interactive map of opportunity zones by state online.

Florida has 427 potential locations or regions that could qualify for the QOZ funds and development. Under the law, the 25% portion that can be selected to use would mean about 106 or 107 different areas could benefit, if builders are interested and approved to begin construction.

The Internal Revenue Service calls the zones an economic tool to allow investment in “distressed areas” of the U.S. and spur economic growth, job creation and provide tax benefits to investors for aiding low-income communities through the programs.

The latest quarterly reports from Florida Realtors showed the median price of a home for sale in the state was about $350,000. In the opportunity zones, ATTOM reported the national median for a home in a low-income area was between $200,000 to $299,999, though 25% of the locations were above the national median home price of $315,000.

Florida remains more expensive as more people move to the state, and development stalls due to lack of materials. Due to the ongoing issues with material costs and delivery, even if the projects are submitted for approval and given the go-ahead, a clear timeline for construction is difficult to forecast.

© 1998-2022 WFLA, Nexstar Broadcasting, Inc. All rights reserved.

https://www.floridarealtors.org/news-media/news-articles/2022/02/hot-real-estate-market-impacted-opportunity-zones

NAR: Jan. Existing Home Sales Surge 6.7%

WASHINGTON – Existing-home sales rose notably higher in January, following a decline the month before, according to the National Association of Realtors® (NAR).

Month-over-month, each of the four major U.S. regions included in NAR’s monthly report saw increased sales, though activity year-over-year was mixed: Two regions reported sagging sales, another watched sales increase and a fourth region remained flat.

Total existing-home sales – completed transactions that include single-family homes, townhomes, condominiums and co-ops – climbed 6.7% from December to a seasonally adjusted annual rate of 6.50 million in January. Year-over-year, sales fell 2.3% (6.65 million in January 2021).

“Buyers were likely anticipating further rate increases and locking-in at the low rates, and investors added to overall demand with all-cash offers,” says Lawrence Yun, NAR’s chief economist. “Consequently, housing prices continue to move solidly higher.”

Total housing inventory at the end of January was 860,000 units, down 2.3% from December and down 16.5% year-to-year. Unsold inventory sits at a 1.6-month supply at the current sales pace, down from 1.7 months in December and 1.9 months in January 2021.

“The inventory of homes on the market remains woefully depleted, and in fact, is currently at an all-time low,” Yun adds.

According to Yun, homes priced at $500,000 and below are disappearing, while supply has risen at higher price ranges. He says those increases will continue to shift the mix of buyers toward high-income consumers.

“There are more listings at the upper end – homes priced above $500,000 – compared to a year ago, which should lead to less hurried decisions by some buyers,” Yun says. “Clearly, more supply is needed at the lower-end of the market in order to achieve more equitable distribution of housing wealth.”

The median existing-home price for all housing types in January was $350,300, up 15.4% from January 2021 ($303,600), with prices higher in each of the four regions. January marks 119 consecutive months of year-over-year increases – the longest-running streak on record.

Properties typically remained on the market for 19 days in January, equal to days on market for December and down from 21 days in January 2021. Four out of five homes (79%) sold in January were on the market for less than a month.

First-time buyers were responsible for 27% of sales in January, down from 30% in December and down from 33% in January 2021.

Yun says that anticipated increases in mortgage rates will be problematic for at least two market segments.

“First, some moderate-income buyers who barely qualified for a mortgage when interest rates were lower will now be unable to afford a mortgage,” he says. “Second, consumers in expensive markets, such as California and the New York City metro area, will feel the sting of nearly an additional $500 to $1000 in monthly payments due to rising rates.”

Individual investors or second-home buyers, who make up many cash sales, purchased 22% of homes in January, up from 17% in December and 15% in January 2021. All-cash sales accounted for 27% of transactions in January, up from 23% in December and from 19% from January 2021.

Distressed sales – foreclosures and short sales – represented less than 1% of sales in January, equal to the percentage seen in both December and January 2021.

According to Freddie Mac, the average commitment rate for a 30-year, conventional, fixed-rate mortgage was 3.45% in January, up from 3.10% in December. The average commitment rate across all of 2021 was 2.96%.

Single-family and condo/co-op sales: Single-family home sales jumped to a seasonally adjusted annual rate of 5.76 million in January, up 6.5% from 5.41 million in December and down 2.4% from one year ago. The median existing single-family home price was $357,100 in January, up 15.9% year-to-year.

Existing condominium and co-op sales were recorded at a seasonally adjusted annual rate of 740,000 units in January, up 8.8% from 680,000 in December and down 1.3% from one year ago. The median existing condo price was $297,800 in January, an annual increase of 10.8%.

“The market is still thriving as an abundance of home sales took place in January,” says NAR President Leslie Rouda Smith. “We will continue to beat the drum for more inventory, which will give buyers additional options and also help alleviate increasing costs.”

January regional breakdown: Existing-home sales in the Northeast grew 6.8%, posting an annual rate of 780,000, an 8.2% decline from January 2021. The median price in the Northeast was $382,800, up 6.0% year-to-year.

Existing-home sales in the Midwest rose 4.1% from the prior month to an annual rate of 1,510,000, equal to the level seen a year ago. The median price in the Midwest was $245,900, a 7.8% rise from January 2021.

Existing-home sales in the South – the region that includes Florida – jumped 9.3% from the prior month, for an annual rate of 2,940,000 – a gain of 0.3% from one year ago. The median price in the South was $312,400, an 18.7% surge from one year prior.

For the fifth straight month, the South saw the highest pace of price appreciation.

“The migration to the Southern states is clearly getting reflected in higher home sales and fast rising home prices compared to other regions,” Yun says.

Existing-home sales in the West increased 4.1% from the previous month, registering an annual rate of 1,270,000 in January, down 6.6% year-to-year. The median price in the West was $505,800, up 8.8% from January 2021.

© 2022 Florida Realtors®

https://www.floridarealtors.org/news-media/news-articles/2022/02/nar-jan-existing-home-sales-surge-67

Realtors May Not Be Using All The iPhone Tools

Problem with a home? Take a photo, circle it and send. iPhones also have built-in levels – and Facetime can make it look as if you constantly hold eye contact.

NEW YORK – Your phone can do a lot more than you realize, but no one points out the countless hidden settings and features when you buy it.

Sometimes, you realize you don’t know how to do something simple until you need it. Other features are more hidden. Some of my favorite handy tricks are hiding in the accessibility menu.

Here are 10 more ways to get more out of your iPhone. I bet you’ll use them again and again.

1. Markup

Markup is a powerful tool you might not even realize is there. It lets you edit screenshots and photos, add signatures to PDFs or other documents, insert text, and draw on images without downloading a third-party app.

To draw on photos:

  • Open the photo and tap Edit, then the Markup button. It looks like a pencil inside a circle.
  • Tap the Plus button to add Description, Text, Signature, or Magnifier to zoom in.
  • Once you’ve made your selection, tap Done, then tap Done again.

To sign a PDF and other documents:

  • Open the document and tap Edit, then the Markup button.
  • Tap the Add button to add Text or a Signature.
  • Tap Done twice.

2. Check if a surface is level

Next time you’re hanging a frame, grab your iPhone instead of searching through the garage for a level. Here’s how it works:

  • Open the installed Measure app.
  • Tap Level, then hold your iPhone against an object. Use it just as you would a normal level.

Easy right? Your phone can be a trusty do-it-yourself companion.

3. Delete your last 15 minutes of search history

Looking for a gift? Or maybe you’re searching for something private, like a health-related issue. It’s easy to wipe out the evidence if you use Google for your searches. Try this quick-delete option:

  • Open the Googleapp.
  • Tap on your profile picture in the top right-hand corner.
  • The third option on the screen should be Delete last 15 minutes.

There’s no confirmation button. Once you tap the button, your history will be deleted. There’s a short window in which you can undo the action.

Google knows a lot more than what you looked up in the last 15 minutes.

4. Make your FaceTime chats better

Let’s say a friend calls you for a FaceTime chat. You’re happy to talk, but you’re a little distracted. There’s a trick to multitask without appearing rude.

Introduced with iOS 14, Eye Contact makes it appear as if you’re keeping eye contact, even if you’re looking at another part of your screen. It even works when chatting with multiple people:

  • Open Settings > FaceTime.
  • Slide the toggle next to Eye Contact to the right to enable it.

5. Flash notifications

Don’t want to miss a notification, but you need to keep quiet? Instead of vibrations and sounds, you can set your iPhone’s LED flash to blink when your phone is locked and silenced.

  • Go to Settings > Accessibility > Audio/Visual.
  • Toggle on LED Flash for Alerts.

You can then enable Flash on Silent if you want the LED to only flash when your iPhone is silenced.

6. See what’s flying overhead

Here’s a fun backyard game. Look up and guess where the airplane above you is headed. Los Angeles? New York? Paris?

Just ask Siri this phrase: “What flights are overhead?” You’ll see the carrier, flight number, and altitude in seconds.

7. Mute notifications for a conversation

The constant pings from group messages can be a little much. If you’re done with the conversation in a group message or need a break, give yourself the gift of silence:

  • Touch and hold a conversation in your list of Messages.
  • Tap Hide Alerts.

8. Correct Siri’s pronunciation

Siri is actually pretty smart, but the smart assistant has trouble with some names. You can give her some help:

  • Open Contacts and select the contact you want to add a phonetic pronunciation to.
  • Tap Edit, then add field.
  • Tap Phonetic first, middle, or last name.
  • Type in a phonetic spelling for your contact’s name in the Phonetic field.
  • Tap Done.

If you’d rather do this with your voice, say “Hey Siri, learn to pronounce (contact’s name).” Siri will ask how to pronounce the first and last name.

9. Check your heart rate without an Apple Watch

We’re stepping a little outside the Apple ecosystem here and using the Google Fit app. This is a neat way to check your heart rate without a wearable.

First, link your Google account. You’ll also be asked if you want to link the data with Apple Health. Then, follow these steps:

  • In the Google Fit app, tap Browse at the bottom of the screen.
  • Tap Vitals, then Check your heart rate.
  • Follow the prompts and place your finger over your iPhone’s rear-facing camera.
  • After around 30 seconds, the app will estimate your heart rate.

According to Google, the app estimates blood flow using the camera by tracking the subtle changes in the color of your finger. Make sure you’re in a well-lit area.

Google Fit can also measure your respiratory rate by observing chest movements through your smartphone’s front-facing camera. Check your breathing by selecting Track your respiratory rate in the Vitals menu.

If you do have an Apple Watch, make sure all the essential health settings are turned on.

10. Undo typing with a shake

We all make mistakes when sending messages or entering text into Notes or emails. You can highlight the incorrect text or hold down the delete button, but there’s an easier way.

Shaking your phone will display an Undo Typing window with the option to Undo. Tap that and your words will disappear. Shake the phone again and select Redo Typing if you want them back.

11. Send your precise location

Usually, I give you methods to hide your location – but sometimes you really do need someone to find you. You don’t need to fiddle with your GPS app, either.

  • Open a text message and choose the person you want to share your location with.
  • Tap the information icon > Send My Current Location. Your recipient will see your location on the map.

You can also choose Share My Location, then select the length of time you want to share it.

Copyright 2022, USATODAY.com, USA TODAY. The views and opinions expressed in this column are the author’s and do not necessarily reflect those of USA TODAY.

https://www.floridarealtors.org/news-media/news-articles/2022/02/realtors-may-not-be-using-all-iphone-tools

New Minimum Heights Considered by Miami-Dade

MIAMI – Miami-Dade hasn’t changed the most basic form of flood protection – the minimum height for building things like roads and new homes – in 40 years.

Now a new proposal on the table could nearly double that standard, a dramatic change that reflects two inevitable realities: sea rise poses an increasingly imminent threat and adapting to it will raise construction costs.

A new minimum height of 6 feet for things like roads, sea walls, canal banks and lots sounds high, but the visual impact will likely be minor for everywhere except the most low-lying pockets of the county. The costs of such a change, if the county commission agrees to pass it, are unclear. It could add up in a community squeezed by an affordable housing crisis and also facing a future of more frequent flooding.

“It’s a resilience measure,” said Marina Blanco-Pape, director of Miami-Dade Division of Environmental Resources Management’s (DERM) water management division. “The idea is you’d build to a high enough elevation that with a 10-year storm event in 2060 you’re free of flooding.”

But like most other measures to build a safe building, like stronger roofs or windows, the expense can add up. Howard Nelson, head of environmental practice at Miami-based law firm Bilzin Sumberg, said adding a foot of fill to a quarter acre lot in Miami-Dade could run between $3,000 to $5,000. For developers working with much larger tracts of land, it could be a significant impact.

“I don’t want to detract from the concept that raising the elevation of roads, of sea walls, is enormously important to protect us from rising sea levels, but it’s got some costs to it,” he said.

Technically, the proposal from DERM would bump the minimum elevation from 3.45 feet to 6 feet NAVD88. That stands for North American Vertical Datum, a national fixed measure used by surveyors, engineers and others to determine elevation used instead of “sea level,” which is shifting due to climate change.

DERM mapped out what would happen if a strong rainstorm hit Miami-Dade in 2060, when estimates suggest the county will see about two feet of sea level rise. Plenty of the county, including inland and western areas, would experience flooding at their current heights, but not as much flooding if all those structures were two feet higher.

Blanco-Pape said researchers analyzed the storm surge Miami-Dade experienced in Hurricane Irma, which drove 6 feet of storm water ashore in the south end of Biscayne Bay and four feet of storm surge in the northern, more urban areas.

“That’s how we came to pick that 6 feet NAVD88, because we thought it would give us the added protection because of sea level rise-driven storm surge impacts,” she said.

Another factor is groundwater, which is also rising along with sea levels. During the average October currently, a period where there’s more rain and tidal flooding, an analysis of 170 wells in Miami-Dade found groundwater reached a maximum height of 5.71 feet NAVD88, although the median height was just under 2 feet NAVD88.

Blanco-Pape said her team plans to present the proposal to the Miami-Dade Commission sometime in the next few months, and public comment on the new flood criteria closed at the end of January.

Who’s affected?

If this policy passes, existing structures and buildings wouldn’t be affected, only new construction or major renovations.

Any home or building that does “substantial improvements” affecting 50% or more of the value of the property would be required to meet these new standards, exactly like it would be required to meet the newest version of the building code.

But even where it does apply, county modeling shows that the new standard wouldn’t result in thousands of buildings across the county suddenly being required to dramatically elevate. That’s because most lots are already pretty close to the proposed 6-foot requirement, or even above it.

Blanco-Pape said the average elevation change in unincorporated Miami-Dade is about two feet, although some very low properties may see more.

“If you look at that county-wide, there may be some specific properties that will be more impacted, but we’re not talking about anything that all of a sudden created a 5 or 6-foot building requirement. You’re not gonna see that at all,” she said.

There are almost no changes to properties on the coastal ridge of high ground that runs down the center of the county, and west of that ridge the average change is less than a foot, according to county calculations. Coastal areas and southern parts of the county would see an average change of two to three feet.

If approved, the new standards would apply to all unincorporated areas of the county and in any municipality that specifically cites the county’s flood criteria in its code, like the city of Miami. About a third of the municipalities in Miami-Dade would be affected directly by this switch.

This doesn’t affect the long-standing rules guiding how high buildings or homes must be built – commonly known as base flood elevation or BFE. That number is set by the National Flood Insurance Program, and the Florida Building Code tacks on another mandatory foot. Some cities (like Miami Beach) allow builders to go even higher to be safer in storms and floods.

Elevate everything

Elevation is a key component of Miami-Dade’s plan to address the impact of sea level rise, which is expected to rise about two feet by 2060. Visually, that might look like the annual king tides South Floridians are used to dealing with every fall.

That could put more than 12,000 homes and $6.6 billion in property value at risk, according to an analysis by Climate Central.

Miami-Dade’s sea level rise strategy focuses on moving away from the rising water – a process known as retreat – and elevating everything.

This new flood elevation criteria covers parts of the puzzle within county control: seawalls, the height of canal banks, county roads and fill, the height of the rock added to a piece of property before a building is built on it. Del Schwalls, a consultant and southeastern director of the Association of State Floodplain Managers, said coastal counties in Florida and beyond are making similar moves to counteract the invading sea.

“It’s part of a conversation that’s been going on for a while,” he said. “Recognizing that flood risks are increasing along the coasts, it is imperative that communities reevaluate whether the regulatory requirements they’ve had in place are sufficient.

Elevating canal banks and sea walls will help protect nearby properties from flooding, but Schwalls worries that adding more rock and dirt to properties could cause problems for their neighbors, especially as sea rise makes flooding more common.

“Adding more fill in the floodplain is problematic. Although the building being raised may be safer, those flood waters are diverted elsewhere and become someone else’s problem,” he said.

Those in the development industry wave off that concern by pointing to state building code rules that require properties to take care of every drop of rain that falls on their property and make sure it doesn’t flood neighbors.

Nelson, who represents developers, also pointed to a concern that already plagues places like Miami Beach, which raised roads before homes or buildings. Elevating some parts of a neighborhood before others can lead to an uneven distribution of flood risk for the parts that get left behind.

“That patchwork will get evened out over the next 50, 60, 70 years but it’s a difficult path to tread,” Nelson said. “There is no doubt that we will need to raise the elevation of our communities, but we need to do it holistically.”

© 2022 Miami Herald. Distributed by Tribune Content Agency, LLC.

https://www.floridarealtors.org/news-media/news-articles/2022/02/new-minimum-heights-considered-miami-dade

Researchers: Home Market ‘Close to Peak’

Home prices, inflation and rising interest rates will soon create a balance in the housing market, say FAU researchers, though prices will remain high.

JACKSONVILLE, Fla. – The Jacksonville area’s booming housing market has left home values a little inflated, say a pair of academics warning that flush times for home-sellers across the state could be ending.

“If you’re buying a home in these metros across Florida … it’s imperative that you know you’re buying close to the peak of the market,” said Ken H. Johnson, an economist at Florida Atlantic University who has been researching home prices nationwide with Florida International University professor Eli Beracha.

The researchers aren’t forecasting a market collapse, but they say the crush of buyers that drove up prices nationwide last year could soon taper considerably.

“Mortgage rates have been near historic lows for the last two years and have helped keep housing demand strong through the pandemic,” Beracha said in a release about their research, expected to be published in a scholarly journal on housing. “Now we’re seeing rates rise, and that’s going to take some buyers out of the market and curtail price gains.”

Jacksonville could be seeing hints of a slowdown already, said Northeast Florida Association of Realtors President Mark Rosener. But he said the area’s demographics and a stream of buy-and-lease investor purchases should help buoy the market modestly even after a year when median single-family home prices rose 22%.

“It’s not going to be dramatic,” Rosener said.

Last year’s price hikes added to Jacksonville home costs that the researchers said have become more overpriced than most, ranked at 36th in a list of 100 metro housing markets across the country, but only eighth out of the nine Florida markets the researchers measured.

The researchers used 25 years of data to track prices by market and estimate an “expected” price on a typical home in each market, then compared those against a Zillow index of real-world prices for each market.

Jacksonville’s index price ended December at $321,420, about 32% above what the researchers considered an expected price of $243,019.

Because the rankings were based on the percentage markup compared to the index price, Lakeland’s index price of $271,809 – about 43% above the expected price – was counted as the state’s most overvalued market and 12th nationally. On the other extreme, always-expensive Miami-Fort Lauderdale’s index price of $397,603 – with a roughly 21% premium – was scored as Florida’s least overpriced metro market, and 60th nationwide.

If the researchers’ expected pricing was correct, overpaying has apparently become standard nearly everywhere.

Of the 100 markets in the study, only one – Honolulu, Hawaii – had an index price below what was expected, and then only by 0.1%. Baltimore, New York, Virginia Beach, Va., and Washington, D.C. were the next least overvalued, the researchers concluded.

Rosener said other metrics, like the Case-Shiller home price index, had already made Realtors aware that Jacksonville’s prices were growing faster than many places. But he said local conditions still seem good for the housing market, absent the exuberant increases seen last year.

The area’s relatively young population includes a lot of millennials entering age brackets when people are more typically interested in buying homes, Rosener said. In addition, he said, the area has been attractive for investors wanting to buy houses they can hold as rental property for an area where the population is growing and apartment rents are climbing.

Luxury homes have also become more attractive to affluent buyers who considered real estate a more reliable place to hold their wealth than stocks or cryptocurrencies.

After two years when pandemic conditions changed routines of how homes were bought and sold, Rosener said Jacksonville could experience a more routine “seasonality of the real estate business,” with slower winters, busy springs and an inventory that could grow over the coming year as builders gradually resolve more supply-chain problems.

He said preliminary data on January transactions suggests fewer sales closed last month but the number of pending deals, where homes are under contract, rose.

Despite discussion of being over-valued, Rosener said Jacksonville’s housing market is fundamentally different from the overpriced flippers’ market that fueled the Great Recession in the mid-2000s.

“People are buying homes to live in them. They’re not buying homes speculatively,” he said. “If you’re buying a home to live in and raise your family … that’s your motivation. You’re not looking at it to be a quick buck.”

Copyright © 2022 The Florida Times-Union.

https://www.floridarealtors.org/news-media/news-articles/2022/02/researchers-home-market-close-peak

Builders Say Supply Issues Create Major Problem

Feb.’s confidence index fell another point. It’s a still-strong 82, but “many builders wait months to receive cabinets, garage doors, countertops and appliances.”

WASHINGTON – Despite strong buyer demand, builder sentiment continued to slip in February. According to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI), the industry grapples with ongoing building material production bottlenecks that raise construction costs and delay projects.

Builder confidence in the market for newly built single-family homes moved one point lower to 82 in February, the second straight month that levels declined by a single point. Despite these monthly declines, however, the HMI has posted solid readings at or above the 80-point mark for the past five months.

“Production disruptions are so severe that many builders wait months to receive cabinets, garage doors, countertops and appliances,” says NAHB Chairman Jerry Konter. “These delivery delays are raising construction costs and pricing prospective buyers out of the market. Policymakers must make it a priority to address supply chain issues that are harming housing affordability.”

“Residential construction costs are up 21% on a year-over-year basis, and these higher development costs have hit first-time buyers particularly hard,” adds NAHB Chief Economist Robert Dietz. “Higher interest rates in 2022 will further reduce housing affordability, even as demand remains solid due to a lack of resale inventory.”

Index components: The HMI index gauging current sales conditions increased one point to 90, though the gauge measuring sales expectations over the next six months fell two points to 80, and the component charting traffic of prospective buyers posted a four-point decline to 65.

Looking at the three-month moving averages for regional HMI scores, the Northeast increased three points to 76, the West rose one point to 89, the Midwest fell one point to 73 and the South – which includes Florida – edged one point lower to 86.

Derived from a monthly survey that NAHB has been conducting for more than 35 years, the NAHB/Wells Fargo HMI gauges builder perceptions of current single-family home sales and sales expectations for the next six months as “good,” “fair” or “poor.” The survey also asks builders to rate traffic of prospective buyers as “high to very high,” “average” or “low to very low.” Scores for each component are then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view conditions as good than poor.

© 2022 Florida Realtors®

https://www.floridarealtors.org/news-media/news-articles/2022/02/builders-say-supply-issues-create-major-problem

Jan.: Housing Starts Down, Building Permits Up

While the number of housing starts declined 4.1% compared to Dec., the number of building permits – indicators of future housing-start numbers – rose 0.7%.

ORLANDO, Fla. – The number of U.S. housing starts declined in January, according to a joint release by the U.S. Census Bureau and the U.S. Department of Housing and Urban Development. However, the number of building permits – an indication of future housing-start numbers – rose both month-to-month and year-to-year.

Housing starts: Privately-owned housing starts in January, a seasonally adjusted annual rate of 1.64 million, fell 4.1% compared to December numbers. However, they’re up year-to-year by 0.8%.

Permits for single-family homes weighed more heavily in the overall number. At a rate of 1,116,000, single-family starts fell 5.6% below December numbers.

Building permits: Economists consider building permits an estimate of future housing starts, and January numbers were up a bit both month-to-month (0.7%) and year-to-year (0.8%).

The number of single-family permits issued in January rose to 1.2 million, or 6.8% about December numbers.

Many experts aren’t ready to draw conclusions from recent data. The January drop in housing starts could reflect a number of temporary headwinds, such as slowdowns due to the omicron variant of COVID-19, and it could reflect supply-side shortages that have postponed some projects months longer than first estimated.

According to MarketWatch, the number of home completions dropped in January, but “the number of homes under construction rose – a sign of the impact of these supply backlogs.”

© 2022 Florida Realtors®

https://www.floridarealtors.org/news-media/news-articles/2022/02/jan-housing-starts-down-building-permits

Real Estate Marketing: Is LinkedIn the New Facebook?

While Facebook still dominates marketing, it’s losing share to LinkedIn, at least within the real estate industry. And TikTok appears to be on the rise, too.

NEW YORK – Facebook remains a prominent marketing channel, but it’s losing share among real estate industry marketers. Madeleine Stearn, digital marketing manager at Curbio, which helps real estate agents get homes market-ready, says the company has reduced its marketing spend with Facebook by half in the past six months.

She says LinkedIn is currently a close second in the company’s overall spend behind Facebook, with investments in the platform increasing every month.

TikTok is also gaining prominence, Stearn says: “Despite Facebook’s promises of a bright future with Conversions API (CAPI), it became clear almost immediately that Facebook was nowhere near the powerhouse it was pre-iOS 14,” Apple’s software that made it harder for Facebook to collect personal information. CAPI is a Facebook Business Tool that lets advertisers share customer actions from their servers directly to Facebook.

Stearn says Curbio is focusing on Google Ads and “industry-specific publications, podcasts and training programs.”

Mike Whaling, president of 30 Lines, which helps apartment marketers maximize their digital advertising spend, says the company’s ad spend on Meta properties (Facebook, Instagram, Messenger) declined 10% in the past year, based on factors like “current consumer behavior trends, rising ad costs on Meta, and reduced performance based on targeting restrictions and Apple privacy changes.”

“SnapChat and TikTok have done a better job at handling Apple’s updates than Meta,” Whaling adds. “Investments in CRM and marketing automation have also improved marketing results, so marketers simply don’t need to spend as much on ‘top of funnel’ acquisition to fill the same pipeline.”

Source: GlobeSt.com (02/08/22) Bergeron, Paul

© Copyright 2022 INFORMATION INC., Bethesda, MD (301) 215-4688

https://www.floridarealtors.org/news-media/news-articles/2022/02/real-estate-marketing-linkedin-new-facebook

Tool Can Shorten Loan Processing by 15 Days?

Freddie Mac has a new “automated method” to analyze incomes based on direct deposits. Up to 93% of borrowers could see a quicker loan-process timeline.

WASHINGTON – Freddie Mac is launching an automated method for lenders to assess prospective borrowers’ income paid through direct deposits. The tool cuts down the amount of mandatory paper documentation and, Freddie says, that can close loans faster – up to 15 days faster in some cases.

Mortgage lenders nationwide should soon have access to the new tool, and it can be used – with the borrower’s permission, to assess income made by direct deposits into their accounts. More than 93% of U.S. workers are paid by direct deposit, according to the American Payroll Association.

The tool also can assess an applicant’s income from employer data and review tax return data for self-employed individuals.

A Freddie Mac study recently showed that lenders using such tools can shorten average cycle times for processing loan requests by up to 15 days.

“Our direct deposit solution is an innovative, data-driven approach that takes minutes, not days, to assess income so our clients can serve more borrowers more efficiently,” says Matt Vincent, Freddie Mac’s single-family vice president of credit and capacity. “Sourcing data directly from the mortgage applicant’s bank account increases accuracy, removes subjectivity, reduces manual underwriting errors and delivers a better experience for borrowers and lenders.”

Source: Freddie Mac

© Copyright 2022 INFORMATION INC., Bethesda, MD (301) 215-4688

https://www.floridarealtors.org/news-media/news-articles/2022/02/tool-can-shorten-loan-processing-15-days

Average Mortgage Rate Increases Again, Hits 3.92%

It’s been almost two years since a 30-year, fixed-rate mortgage averaged 3.92% (May 2019 at 3.99%). One year ago, the 30-year FRM averaged 2.81%.

WASHINGTON (AP) – Average long-term U.S. mortgage rates jumped again last week, approaching levels not seen since 2019.

The average rate on a 30-year loan rose last week to 3.92% from 3.69% the previous week, mortgage buyer Freddie Mac reported Thursday. A year ago, the long-term rate was 2.81%.

The last time the 30-year rate was higher was in May of 2019 when it reached 3.99%.

The average rate on 15-year, fixed-rate mortgages, popular among those refinancing their homes, rose to 3.15% from 2.93% one week earlier. It stood at 2.21% a year ago. It last breached 3% in March of 2020, just as the pandemic was breaking in the U.S.

The Federal Reserve has signaled that it would begin the first in a series of interest rate hikes in March, reversing pandemic-era policies that have fueled hiring and growth but also contributing to inflation levels not seen since the early 1980s.

The Labor Department reported last week that consumer prices jumped 7.5% last month compared with 12 months earlier, the steepest year-over-year increase since February 1982. Higher costs for nearly everything have burdened consumers, offsetting pay raises and reinforcing the Federal Reserve’s decision to begin raising borrowing rates across the economy.

The price for a new home has jumped about 14% in the past year and as much as 30% in some cities. Housing has been in short supply even before the pandemic, and higher prices and rising interest rates will make it even harder for homebuyers.

“As rates and house prices rise, affordability has become a substantial hurdle for potential homebuyers, especially as inflation threatens to place a strain on consumer budgets,” said Sam Khater, Freddie Mac’s chief economist.

Copyright 2022 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without permission.

https://www.floridarealtors.org/news-media/news-articles/2022/02/average-mortgage-rate-increases-again-hits-392

Fla. to Distribute $676M in Homeowner Mortgage Aid

On Feb. 9, the U.S. Treasury OK’d Fla.’s plan to distribute federal money to help homeowners, though the state has not yet released its distribution plan.

FORT LAUDERDALE, Fla. – There’s good news and bad news for Florida homeowners who fell behind on their mortgage payments because of the pandemic.

The good news is the U.S. Treasury Department on Feb. 9 approved Florida’s plan to distribute $676 million in federal homeowner assistance funding included in the $1.9 trillion American Rescue Plan enacted in March 2021.

Florida submitted its plan for approval as required six months ago, on Aug. 20.

The not-so-good news: Florida’s program is being administered by the Department of Economic Opportunity (DEO), and the agency has not yet announced when or how it will begin accepting applications.

“Now that the [plan] has been approved, DEO will launch the program,” department Press Secretary Morgan Jones said by email. “DEO will provide additional information once the program is operational and available for homeowners in need.”

But Jones provided no further information about when the program will launch or how homeowners will be able to apply.

Still, news that Florida’s program had passed a key hurdle was welcomed by Wendy Longley, a Margate resident who has been waiting since August for an opportunity to apply. That’s when she exited forbearance, an emergency grace period that enabled homeowners to suspend their mortgage payments with no negative impact on their credit histories if affected by the pandemic.

“I have waited for this for months. Endless worry,” said the mother of two, who says her mortgage lender is asking her to repay in a lump sum all of the months that she missed. Longley says she signed up for email-status reports as directed on a department webpage posted last fall.

“I check my email every day,” she said. But as of Wednesday, she has received no notifications, she said, and the webpage still does not include a launch date for the program or tell homeowners how to apply.

Based on information provided so far and included in the distribution proposal submitted to the Treasury Department, the state plans to rely heavily on third parties, as it did during a pilot program launched on Nov. 8, to notify eligible homeowners about the available assistance.

For the pilot program, the department “began utilizing 10% of the allocated funding to launch the [program],” Jones said. “Through the pilot program, DEO works with service providers in banking, property insurance, and utilities industries to identify customers who may be eligible to receive assistance. DEO, in turn, works directly with those homeowners to determine eligibility for the program and provide assistance.”

So far the pilot program has distributed more than $1 million to 135 homeowners, said Emilie Oglesby, the department’s director of communications and external affairs, in an email.

Numerous other states have recently launched their programs following Treasury Department approval of their distribution plans.

Oglesby wrote, “DEO has worked proactively to assist homeowners through the pilot program while waiting 6 months for the federal government’s approval of the HAF plan. It is my understanding that the states [that launched their programs] received approval of their plans long before Florida received its approval just seven days ago.”

Kentucky opened its online application portal on Feb. 7 for homeowners to apply for up to $35,000 to help with delinquent mortgage payments, property taxes, insurance, utility costs and homeowner association fees. After applicants are approved, funds are sent directly to the companies, tax collectors or homeowner associations that are owed, according to news stories in Kentucky.

Other states accepting applications include Michigan, Nebraska, Pennsylvania, Rhode Island, North Carolina, Alabama, New Jersey, and Georgia. New York launched its program in January and will stop accepting applications after Friday.

© 2022 South Florida Sun-Sentinel. Distributed by Tribune Content Agency, LLC. Ron Hurtibise covers business and consumer issues for the South Florida Sun Sentinel.

https://www.floridarealtors.org/news-media/news-articles/2022/02/fla-distribute-676m-homeowner-mortgage-aid

It’s Not Just Home Prices; U.S. Rents Rise Sharply

Cities in Florida, New York and New Jersey are seeing steep jumps in rent. Austin, Texas had biggest 1-year gain, 40%; rent in Orlando rose 30%.

MINNEAPOLIS – Last year, Laura Kraft landed a job in Orlando, Fla. She’d just gotten her Ph.D. in entomology, meaning she studies bugs, and she’d be working on a big nature exhibit at a theme park. All that sounded great until she started looking for an apartment.

“I started looking at rent and was like, not sure if I was going to take the job,” she says. “The rent was so high in Orlando. It really blew me away.”

At first she looked for a place of her own. But anything in her price range had a waiting list at least six months long. So she found a Facebook group for theme park employees looking for roommates in order to afford a place to live.

“My roommate and I together are paying $2,200,” Kraft says. “A lot of people that I know have like three, four, sometimes five roommates in a house.”

The cost of renting a place in Orlando rose nearly 30% just last year alone, according to a survey by the real estate firm Redfin. Cities in Florida, New York and New Jersey are seeing particularly steep jumps in rent, as is Austin, Texas, with the biggest one year gain of 40%.

The survey, it should be noted, tracks new listings for apartments.

“That doesn’t literally mean that every person in Austin is going to see their rent go up 40%,” says Redfin’s Chief Economist Daryl Fairweather. “But it means that if you are on the market right now looking for an apartment or home to rent, the prices will be 40% higher than they were the year before.”

Some of the forces driving rents higher differ from city to city. Fairweather says a lot of technology workers have been moving to Austin and the migration of more people there is pushing up both rents and home prices. In New York City, rents are rebounding after falling earlier in the pandemic.

But she says rents are rising more than usual just about everywhere.

“The root cause of the problem is a lack of supply,” Fairweather says. “We have not built enough homes to meet demand.”

There a bunch of reasons for that. One of the biggest, she says, is restrictive zoning. Especially in higher-cost parts of the country, zoning rules make it hard to build cheaper smaller houses or apartments that are tightly packed together.

Meanwhile, Fairweather says more millennials in their late 20s and early 30s feel like they’re done with roommates or their parents’ basement.

“Millennials are the biggest generation,” she says. “We’re forming households, and we want a place of our own and that is causing an increase in demand.”

Redfin’s survey looks at the 50 largest U.S. cities. On average, it found the rents landlords were seeking for available homes and apartments rose 3% in 2020, which is about normal for recent years. But then last year, they rose 14%.

Government data show that the rent Americans are actually paying – not just the change in price for new listings – rose 3.8% over the past year. But, while less dramatic, that consumer price index also shows rents have been rising more than usual the past few months.

Allison Best-VanLiew is feeling the bite of those rising rents up in Buffalo, N.Y. “It’s been a little wild, to be honest,” she says.

By no stretch is Buffalo a hot housing market historically. Best-VanLiew and her husband have been renting on a busy street for a few years, and they pay $900 a month.

“We do not have a dishwasher, which is normally fine.” But she says now they are thinking of having a baby. “The bottles alone, like you kind of need that.”

And as they’ve been looking around for a better place, she says everything seems more expensive than it was a few years ago. “Between $1,200 and $1,400 for a place relatively close to this size with just a dishwasher,” she says.

Like a lot of young couples, she and her husband would rather buy a house. But with home prices hitting new records she says they’re having trouble saving enough for a down payment. And with so many would-be first-time homebuyers priced out of the market, that boosts demand for rentals and helps push rents even higher.

Copyright © 2022, NPR, KNOW Minnesota Public Radio. All rights reserved.

https://www.floridarealtors.org/news-media/news-articles/2022/02/its-not-just-home-prices-us-rents-rise-sharply

Two Property Insurers Halt New Policies in Fla.

As St. Johns Insurance and Lighthouse Property Insurance Corp. announce the decisions, state lawmakers consider proposals to address the troubled industry.

TALLAHASSEE, Fla. – As another sign of problems in Florida’s property-insurance industry, two insurers said Tuesday they are halting writing new business in the state.

St. Johns Insurance and Lighthouse Property Insurance Corp. notified agents of the decisions, according to copies of the notices. St. Johns said in its notice that it has used “many strategies to manage our risks,” such as not renewing policies, using new rules for eligibility for business and making rate changes.

But it said, “At this time, St. Johns Insurance has made the difficult decision to suspend all new business writing statewide as of February 15, 2022 … This closure applies to all lines of business.”

The announcements came as state lawmakers consider proposals to address the troubled industry, which has shed policies and sought hefty rate increases to try to reduce financial risks.

The problems have led to a huge influx of customers at the state-backed Citizens Property Insurance Corp., which has been adding thousands of policies a week. As of Jan. 31, Citizens had 776,790 policies, about a 75% increase over the past two years.

© 2022 The News Service of Florida. All rights reserved.

https://www.floridarealtors.org/news-media/news-articles/2022/02/two-property-insurers-halt-new-policies-fla

Must Board Send Notices to Non-Full-time Residents?

Condo Q&A: The answer may depend on what type of meeting is being held, if it’s a regular board meeting or involves a special assessment or other issue.

STUART, Fla. – Question: A large percentage of the owners in our condo building live out of town for at least part of the year. The board posts notices of all meetings on the bulletin board in one of the common area rooms of the building. Is the board required to give these notices to the owners who don’t live in the building full time since they won’t see the posted notices in the building if they aren’t here? – J.N., Boca Raton

Answer: First, we need to separate your question into two parts depending on the type of meeting that you are referring to: (a) meetings of the board or (b) meetings of the members.

Section 718.112(2)(c), Florida Statutes addresses the requirements for all meetings of the board, including notice requirements. For regular board meetings, the statute only requires that notice be posted conspicuously on the condominium property at least 48 continuous hours before the meeting, except in an emergency.

There is no requirement that the notice be provided by mail or email, or otherwise transmitted to all owners, whether or not those owners are able to see the posted notice by being physically present on the condominium property.

Please note, however, that there are additional requirements for certain types of board meetings, including a meeting at which a special assessment or an amendment to rules regarding unit use will be considered.

The statute provides that notice of such board meetings, in addition to being posted conspicuously on the condominium property, must also be mailed, delivered, or electronically transmitted to the unit owners at least 14 days before the meeting.

As to meetings of the members, such as a budget meeting, a special meeting of the members, or the association’s annual meeting – except if an election is to be held, which has its own set of notice requirements – then the notice must be mailed, delivered, or electronically transmitted to the unit owners and posted conspicuously on the condominium property at least 14 days before the meeting.

Please note, however, in connection with all of the above, you should also look at your association’s governing documents to see if they contain any specific provisions with regard to notice of meetings, as such provisions may have additional or different requirements than what is provided in Chapter 718, Florida Statutes.

Question: The board of my condo association, which has over 400 units, has been charging and collecting a fee of around $900 from all new owners when they buy a unit and the fee is categorized as a “capital contribution.” Is such a capital contribution allowed under the Florida Condominium Act? – B.G., Fort Pierce

Answer: Assuming that your community is indeed a condominium association as you have stated, governed by Chapter 718, Florida Statutes, and not a homeowners’ association, which is governed by Chapter 720, Florida Statutes, then the collection of a capital contribution from new owners is not permitted.

Section 718.112(2)(i), Florida Statutes, states, in relevant part, “An association may not charge a fee in connection with the sale, mortgage, lease, sublease, or other transfer of a unit unless the association is required to approve such transfer and a fee for such approval is provided for in the declaration, articles, or bylaws. Any such fee may be preset but may not exceed $150 per applicant.”

As provided in the statute above, a condominium association’s ability to collect a fee from new owners is limited to those associations which are required by their governing documents to approve transfers, and the amount of such transfer fee is to be specified in such documents.

Even then, such a transfer fee may not exceed $150. Therefore, a condominium association may not charge a capital contribution fee of $900 for new owners. Please note that Chapter 720, Florida Statutes, governing homeowners’ associations, does not contain this same restriction.

Avi S. Tryson, Esq., is a partner of the Law Firm Goede, DeBoest & Cross. The information provided herein is for informational purposes only and should not be construed as legal advice. The publication of this article does not create an attorney-client relationship between the reader and Goede, DeBoest & Cross, or any of its attorneys.

Readers should not act or refrain from acting based upon the information contained in this article without first contacting an attorney, if you have questions about any of the issues raised herein. The hiring of an attorney is a decision that should not be based solely on advertisements or this column.

Copyright © 2022 Journal Media Group, Treasure Coast Palm. All rights reserved.

https://www.floridarealtors.org/news-media/news-articles/2022/02/must-board-send-notices-non-full-time-residents

Survey: Owners Fear Financial Burden of Foundation Repairs

Groundworks: 78% of 978 owners recently surveyed say they’re worried about foundation damage to their home; 25% say they’re rather sell than fix those issues.

VIRGINIA BEACH, Va. – Foundation repairs can be costly, so it’s no wonder homeowners are concerned about the condition of the foundation their home sits on. Seventy-eight percent of 978 owners recently surveyed say they’re worried about foundation damage to their home, according to a new survey from Groundworks, a nationwide foundation services firm.

Many homeowners say they’ve had to deal with some foundation damage to their home already. The most common issues were from water or moisture issues; basement concrete or foundation cracks; sloping, sagging, or uneven floors; and cracks in the ceiling or walls, the survey finds.

The expense of foundation repairs contributes to their concerns. Of the 605 survey respondents who experienced foundation repairs, 47% had costs ranging from $100 to up to $1,000; 35% had repair costs between $1,001 to $5,000; 13% had costs between $5,001 to $10,000; and 5% of respondents said their repairs totaled more than $10,000.

Overall, about a quarter of the nearly 1,000 respondents said they would rather sell their home than fix their home’s foundation issues. Thirty-nine percent said they’d prefer to sell their home as-is if necessary.

Groundworks says that the most common foundation defects on homes they see include:

Tree and shrub roots: Plants that are too close to the foundation can have root systems that damage the home’s foundation.

Settling: Drought conditions can lead to the uneven settlement of a home.

Sinking: Too much water around a home’s foundation from improper drainage or rain and flooding can cause the home to sink.

Poor workmanship: Possible issues could be the concrete mix having too much water that could result in weak cement or the concrete could be improperly leveled.

Source: “Major Home Foundation Repair: Would You List It or Fix It?” GroundWorks

© Copyright 2022 INFORMATION, INC. Bethesda, MD (301) 215-4688

https://www.floridarealtors.org/news-media/news-articles/2022/02/survey-owners-fear-financial-burden-foundation-repairs

Small Apartments, Lower Rent: Answer to Downtown?

WEST PALM BEACH, Fla. – Very small apartments could be the next hot housing option for downtown urban areas.

These so-called micro apartments are only about two-thirds the size of a regular apartment, but they also cost less money than standard apartments. With rents skyrocketing and new apartments scarce, suddenly everyone is interested in getting their hands on micro-apartments.

Among them are hotel operators.

In downtown West Palm Beach, a company affiliated with Korman Communities is buying the soon-to-be completed Current Apartments at 625 S. Olive Avenue.

The property, which was set to open in March, will instead open as a furnished extended-stay hotel under Korman’s upscale AKA brand. AKA has nine properties in five major cities across the United States, plus one in London.

Would-be renters in Current Apartments are out of luck now that the property will be an AKA. Its furnished apartments can be booked daily, weekly or even monthly, depending on the AKA location. It’s not yet clear what length of stay will be offered at this new West Palm Beach AKA.

Prior to the deal with AKA, the developer of Current Apartments said the 217-unit property was about 30% pre- leased. People were very willing to rent a small apartment if it meant living downtown and paying less money than standard apartments, said Joshua Haywood, development manager for Transwestern Development Company in Atlanta.

But at least one another micro-apartment complex is in the works, so would-be renters at Current Apartments might have another choice soon.

West Palm Beach developer Jeff Greene, who has flirted with building micro-apartments on and off for the past eight years said the plan could be back on shortly.

In an interview on Feb. 7, Greene said he’s close to reviving Banyan Place, a micro-apartment project slated for land he owns at 550 Banyan Boulevard, just west of City Hall.

In mid-2017, Greene obtained city approval to build the micro-apartments complex, but he shelved the project later that year. At the time, Greene was concerned the rental market wasn’t strong enough to command the rent prices he needed to make the micro-apartment building work.

Five years later, the coronavirus pandemic prompted an unexpected migration to Palm Beach County, creating a huge demand for housing that has pushed up rental rates. In downtown West Palm Beach, the median rental price of a one-bedroom is about $1,700 per month.

The rise in apartment rents has prompted Greene to dust off plans for Banyan Place. “The project is starting to make more sense, with rents being where they are,” Greene said.

The 1.2-acre Banyan Place called for a 12-story building with 348 apartments ranging in size from 340- to 560-square feet. Although the apartments were small, the building offered plenty of space for common areas. This included an amenity deck on the garage roof, with a canopy-covered outdoor bar, an oversized swimming pool, a cafe, pickleball court, barbecue area, and a sunken fire pit with built-in seating.

At the time, Greene said he hoped to rent at least some of the units for under $1,000 a month, well below the going rate for full-sized apartments. Greene said if he built the apartments now, he would lease them for no less than $1,500 a month.

Micro-apartments can fill a niche, especially for residents working downtown who want to live near their jobs and walk to work, a West Palm Beach city official said.

“I think there’s going to be demand, and we like the concept,” said Rick Greene, West Palm Beach development services director.

The city had hoped to see the micro-unit apartment concept unveiled with Banyan Place.

When that didn’t happen, Greene said the Current Apartments project was the next test.

Current Apartments was built with 217 “micro-apartments” ranging from 350- to 830-square feet. In addition to small apartments, the building also has 6,400 square feet for retail and restaurant space, and a 200-space parking garage, said Dave DeMay, principal and senior vice president of Kast Construction, the West Palm Beach-based contractor that built the complex.

Shannon Steudlein, a former leasing agent for Current Apartments, said the property was popular with professionals working at office buildings downtown.

In fact, interest in Current Apartments was so strong, the smallest units were leasing for $1,600 a month, said Transwestern’s Haywood. Small studios came with a built-in Murphy bed and cabinets. One- and two-bedroom units were offered for lease with furniture rental packages featuring sofas, tables and other items designed to fit a small apartment, Haywood added.

Current Apartments was slated to open in March as the downtown’s newest rental apartment complex, but then Korman Communities made an offer to buy the property and turn it into a hotel. Hotel representatives declined to comment.

On Tuesday, Korman requested city approval for a a change of the property’s use to a hotel. Real estate experts expect Korman’s furnished, extended-stay hotel will do well, too.

“I think it’s going to be a hit,” said Ginger Gowing, a real estate agent with the Ambassador Realty Corp. and a downtown West Palm Beach resident.

AKA by Korman Communities of Pennsylvania is a growing global brand of furnished extended-stay hotels that are designed for weekly and monthly stays.

The hotels include upscale business and lifestyle amenities typically found in luxury residences. AKA’s hotels are in London, New York City, Washington, D.C., Los Angeles, Philadelphia, Miami and soon, West Palm Beach.

Gowing said she sees a need for short-term rentals. She said sometimes professionals need to work in West Palm Beach for a few weeks or a couple of months.

She also sees interest from residents looking to buy a home in Palm Beach County. “A lot of people want to stay some place for two or three months while they buy,” Gowing said.

Then there are all the people remodeling, or planning to remodel, their homes. They need a place to stay for a few weeks when heavy construction makes it impossible to stay in their homes, Gowing added.

Finally, with so many residents choosing to stay in their homes year-round, Gowing said, the availability of rental homes for seasonal stays is limited, creating demand for a furnished apartment-style hotel for seasonal visitors.

Copyright © 2022 Palm Beach Newspapers, Inc., USA TODAY Network.

https://www.floridarealtors.org/news-media/news-articles/2022/02/small-apartments-lower-rent-answer-downtown

Tools for Creating Great Real Estate Video

Online videos may make up over 82% of all consumer internet traffic, so it’s key to use a good camera, microphone and have proper lighting.

TALLAHASSEE, Fla. – Cisco recently estimated that online videos will comprise more than 82% of all consumer internet traffic. Producing videos is not difficult if agents have the right tools and mindset.

Agents who are starting out can use the camera on their smartphone, while those seeking to enhance their video quality can consider the Sony A7III with a 18-105MM lens. This setup costs about $3,000 and allows users to create such effects as blurred backgrounds and wide-angle views.

Lighting is another important aspect to consider. Initially, agents will rely on natural lighting from windows or sunlight, ideally facing the window or source of natural light. Selfie ring lights are donut-shaped that are attached to an adjustable stand. They are lightweight and easy to use in most places and cost about $50 to $100 on Amazon.

Among microphones, the Saramonic Blink 500 wireless lavalier mic set ($250 to $300) features two mics, making it ideal for interviewing or having two people on a video at a time. With the Sennheiser MKE 600 boom mic setup ($500), users can ensure high quality audio.

Resources for video editing, including production enhancements, include Fiverr.com designers who can animate logos and do other tasks. Apple users can leverage iMovie, a free video editing tool. Camtasia is a computer-based editing software that costs about $300. Adobe Premiere Pro, priced at roughly $240 per year, also has a variety of video editing features.

Source: Inman (01/29/22) Burgess, Jimmy

© Copyright 2022 INFORMATION, INC. Bethesda, MD (301) 215-4688

https://www.floridarealtors.org/news-media/news-articles/2022/02/tools-creating-great-real-estate-video

U.S. Foreign Investments Beat Pre-Pandemic Levels

Real Capital Analytics: Foreign investors have shifted focus a bit from major cities, but the $70.8B invested in 2021 is the highest total since 2018’s $94.6B.

NEW YORK – As COVID-19 travel restrictions began to lift last year, foreign investors flocked back to U.S. commercial real estate. Foreign investments exceeded pre-pandemic levels in 2021, according to a new report from Real Capital Analytics.

Foreign investors purchased $70.8 billion of U.S. commercial real estate in 2021 – surpassing 2019 and the highest total since 2018’s $94.6 billion.

The countries most represented in international U.S. commercial investments in 2021 were Canada, Singapore, South Korea and the United Kingdom, according to the report.

However, 2021 investors did shift their focus away from traditional investments like office buildings and hotels in major cities such as New York, San Francisco and Chicago. Instead, they were drawn to growing sectors like warehouses, rental apartments and specialized office buildings for pharmaceutical businesses, The Wall Street Journal reports.

Investors also changed their target markets, homing in on the Sunbelt and smaller markets over coastal cities last year.

“It is a different world,” says Riaz Cassum, global head of international capital coverage for JLL, a commercial property firm. “You’re starting to see big institutional investors looking at Dallas, Charlotte, Denver, Nashville, Austin and other high-growth, low-tax markets.”

Source: “Foreign Investment in U.S. Commercial Property Exceeds Pre-Pandemic,” The Wall Street Journal (Feb. 8, 2022) [Log-in required.]

© Copyright 2022 INFORMATION INC., Bethesda, MD (301) 215-4688

https://www.floridarealtors.org/news-media/news-articles/2022/02/us-foreign-investments-beat-pre-pandemic-levels

Study: Out-of-Town Buyers Have More Money

It’s hard for some current Fla. residents to compete with new ones. In Miami, the average newcomer can spend 25.1% more – but in Jacksonville, it’s only 1.7%.

SEATTLE – The average out-of-towner moving to Miami in 2021 had a budget of $972,470 to spend on a home compared to $777,102 for the average Miami resident – a 25.1% difference that favors newcomers in an area where the median home sells for $459,000, according to a Redfin study of its listings.

The study found the biggest difference in Nashville in 2021 where newcomers had 28.5% more to spend on a home – $736,900 compared to locals who had an average budget of $573,400.

Next comes Philadelphia (28.4% more than local buyers), followed by New York City (26.5% more) and Atlanta (26.1%). Miami rounds out the study’s top five. Overall, out-of-towners have higher budgets than locals in 42 of the 49 cities included in Redfin’s report.

In addition to having more money on average, demand from out-of-town buyers also rose during the pandemic after more people gained the ability to work remotely. Many out-of-towners come from higher-cost, higher-pay areas and choose destinations, in part, because their money can go further.

The result, study writers say, is that home prices in high-demand areas are rising to meet the new demand.

“We’re seeing a lot of out-of-state transplants, mostly from states like California that have an income tax,” says Hope Geyer, a Redfin agent in Nashville, where there’s no state income tax. “People moving from the West Coast will pay way over asking price without batting an eye. In their eyes, they’re getting a deal. It’s really hard for locals to compete right now, and it can be devastating for first-time buyers who aren’t able to offset high prices by selling a home before they buy a new one.”

New residents vs. current residents in 4 Florida metros

  • Miami: 25.1% (Newcomers’ average budget of $972,47 vs. residents’ budget of $777,102)
  • Orlando: 17.8% ($555,216 vs. $471,145)
  • Tampa: 9.2% ($575,429 vs. $527,016)
  • Jacksonville: 1.7% ($409,897 vs. $402,872)

© 2022 Florida Realtors®

https://www.floridarealtors.org/news-media/news-articles/2022/02/study-out-town-buyers-have-more-money

Hottest U.S. Dream Job? Real Estate Agent

The pandemic caused American workers to question their jobs and what they do every day – and Google says the top new-job search term is “real estate agent.”

SAN FRANCISCO – The pandemic-fueled “Great Resignation” trend prompted a lot of people to leave their current jobs in search of new roles. For many people, that very well may be real estate, according to research findings from Google.

Google released search trends on the jobs attracting the most attention on its search engine. The list ranks the top jobs people searched for in the U.S.

The industry has seen a rising number drawn to a real estate career since the pandemic began. The National Association of Realtors® has seen its membership climb from about 1.4 million in 2019 to about 1.52 million in January 2022, according to the latest member data.

According to Google, the top 10 most-searched-for jobs online in the U.S. are:

  1. Real estate agent
  2. Flight attendant
  3. Notary
  4. Therapist
  5. Pilot
  6. Firefighter
  7. Personal trainer
  8. Psychiatrist
  9. Physical therapist
  10. Electrician

Florida, however, was not one of the top states to see real estate career demand.

The 15 states where searches for real estate careers dominated were California, Washington, Wyoming, North Dakota, Nebraska, Minnesota, Kentucky, Tennessee, West Virginia, Virginia, Pennsylvania, New York, New Jersey and Vermont.

Source: “The Jobs People Want, According to Search Trends,” Blog.Google (Feb. 9, 2022)

© Copyright 2022 INFORMATION INC., Bethesda, MD (301) 215-4688

https://www.floridarealtors.org/news-media/news-articles/2022/02/hottest-us-dream-job-real-estate-agent

How Much Will the Fed Boost Interest Rates?

While Federal Reserve members seem ready to raise interest rates in March, they don’t fully agree on how much. Some think it’s time for a strong message.

WASHINGTON (AP) – A worsening inflation picture has touched off a range of opinions from the Federal Reserve’s policymakers about just how fast they should raise interest rates beginning at their next meeting in March.

James Bullard, president of the Federal Reserve Bank of St. Louis, on Monday reiterated his call for the Fed to take the aggressive step of raising its benchmark short-term rate by a full percentage point by July 1. Esther George, president of the Kansas City Fed, expressed support for a more “gradual” approach. And Mary Daly of the San Francisco Fed declined to commit herself to more than a modest rate hike next month.

Their comments follow last week’s report that inflation jumped 7.5% in January from a year ago, the fastest increase in four decades. Prices also rose 0.6% from December to January, the same as the previous month, suggesting that price gains still aren’t slowing, as many economists and Fed officials have hoped.

The Fed typically responds to high inflation by making borrowing more expensive, which slows spending and the pace of price increases.

Last week’s report on consumer inflation prompted a sharp increase in expectations for rate increases by the Fed this year. Some economists now forecast as many as six or seven quarter-point hikes. That’s much higher than the Fed’s projections in December of just three rate increases for 2022.

In their remarks, Bullard and another policymaker, Thomas Barkin, head of the Richmond Fed, noted how the acceleration of prices has broadened beyond autos and other pandemic-affected industries. Even inflation measures that exclude such categories have shown sharp price rises.

Still, the two officials expressed differing views of how the Fed should respond.

“Inflation is very high,” Barkin said in an interview on SiriusXM. “And the more recent readings suggest it’s broader and more persistent. I think it’s timely to get started and steadily move back toward pre-pandemic levels.”

Barkin’s use of the term “steadily” suggested that he favors moving at a more measured pace than Bullard, who said last week that the Fed might even decide to raise rates before its next regularly scheduled meeting in mid-March.

In an interview Monday on CNBC, Bullard did not repeat that suggestion. But he said “inflation is broadening and possibly accelerating.” And he stood by his call for a full percentage point increase in the Fed’s key rate by July 1. An increase that large would mean rate hikes at the Fed’s March, May and June meetings, with one of those hikes amounting to a half-point.

“We need to front-load more” of the rate increases, Bullard said. “We’ve been surprised to the upside on inflation. … Our credibility is on the line here.”

No other Fed officials have publicly endorsed a half-point rate hike at an upcoming meeting, though on Monday investors were pricing in a 60% likelihood of such a step in March.

On Sunday, Daly said on CBS’ “Face the Nation” that an increase that large could hurt the economy by potentially slowing spending too quickly. “History tells us Fed policy that abrupt and aggressive … can actually have a destabilizing effect on the very growth and price stability we’re trying to achieve,” Daly said.

Daly expressed support for a rate hike in March but stopped short of backing Barkin’s call for ongoing increases.

“I see March as an appropriate time to raise the interest rate, and then we have to take in all of the information … and make the right decision at the right time for the economy,” she said.

On Friday, George weighed in on another option under consideration by Fed policy makers. She said in an interview with the Wall Street Journal that the Fed should consider selling some of the Treasurys and mortgage-backed securities that make up its nearly $9 trillion balance sheet.

The Fed said after its most recent policy meeting last month that it would reduce the size of its balance sheet by letting its investments mature and not reinvesting the proceeds. Going further and actually selling some of those bonds would accelerate the process of reducing the Fed’s holdings and would likely send longer-term rates higher.

Fed Chair Jerome Powell has not commented publicly since the most recent jobs and inflation reports have shown strong hiring and wage growth along with rapid price gains. Powell is awaiting confirmation by the Senate for a second four-year term. Lael Brainard, a Fed board member who has been nominated by President Joe Biden for the vice chair position, is also awaiting Senate approval.

The Senate Banking Committee is scheduled to vote on their nominations Tuesday, along with Biden’s picks for three open Fed board seats: Sarah Bloom Raskin, a former Fed and Treasury official, and Lisa Cook and Philip Jefferson, both economists.

Copyright 2022 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without permission.

https://www.floridarealtors.org/news-media/news-articles/2022/02/how-much-will-fed-boost-interest-rates

The Best Places to Start a Fla. Business?

Florida Realtors economist: Fla.’s business focus landed 4 cities (Orlando, Miami, Tampa, Jacksonville) in a “top 15 best places to start a business” list.

ORLANDO, Fla – Florida keeps outgrowing its 20th century reputation as a place to kick back, relax, retire and vacation. Efforts to establish a more diverse economy and workforce over the past few decades are paying off, with several Florida cities attracting more businesses, headquarters and expanded locations.

Beyond the brand-name companies that call Florida home, the Sunshine state now tops lists of places to launch a startup. These kinds of businesses are a critical component to increasing Florida’s profile in industries like tech, health care, biomedical science and others.

A study published by Real Estate Witch compared the 50 most populous U.S. metro areas across 12 metrics, and calculated a combined weighted average of each score to determine it’s “startup city” score. The metrics examined include things like average annual income, number of business and patent applications, employment growth, LLC and incorporation fees, marginal corporate tax rate, among others.

Using these calculations, four Florida cities made the top 10: Orlando (3), Miami (4), Tampa (6) and Jacksonville (8). These cities stand in company with Las Vegas (1), Salt Lake City (2), Atlanta (5), Phoenix (7), Denver (9) and Kansas City (10). All these cities have the following in common: A thriving business climate, averaging 7,500 per 100,000 residents over the past five years, with 26% more CEOs that the national average; strong employment growth over the last 12 months at nearly 1.5x higher than the metro average; and low taxes and fees at 28% less than the studied city average.

Orlando

Orlando has made great strides transforming its image as primarily a vacation destination into a tech hub where businesses can form, grow or relocate. The Orlando Economic Development Commission’s campaign launched a few years ago. “Orlando, You don’t know the half of it” was a major contributor to the city’s reputation rebrand.

Efforts like these pay off. With 9,265 business applications per 100,000 residents over the last five years – 56% more than the studied city average – Orlando ranks third on the list of fastest-growing startup scenes. The Orlando metro area also has the second-highest employment growth rate (7%) behind Las Vegas.

Miami

With 14,058 business applications per 100,000 residents in the last five years, Miami has 2.5-times the number of applications as the average city on the list (5,931).

Miami has become a haven for all sorts of tech, finance and other heavy-hitter industries during the pandemic. Google search inquiries for “business plan” in Miami have soared to the No. 6 spot on the list. Not just a place for back office operations, Miami and neighbor Palm Beach are becoming known for major headquarter relocations as well. Elliot Management, Blackstone, Citadel, Icahan Enterprises and all major investment firms, have relocated or expanded satellite offices in recent months.

The city also ranks No. 7 among all cities for interest in the search term “venture capital,” and a slew of investors have moved to South Florida for its low tax rates. SoftBank Group Corp. announced a $100 million funding initiative for Miami-based companies or those planning to relocate. Goldman Sachs is also looking for space in the area.

Miami’s tech boom is also good news for Latin American startups. The city has a host of bilingual employees – about 75% of the population speaks a language other than English – and it’s in the same (or almost the same) time zone as most Latin American countries, making it easier to do business internationally.

Tampa

For entrepreneurs looking to start a business, Tampa Bay has it all: employment growth (5.6%), affordable employees ($52,291), and flourishing businesses (7,695 business applications per 100,000 residents).

The Tampa Bay area is a rapidly growing startup hub named one the best emerging tech cities and one of the best places to work in tech. Per-capita business applications (7,695) have exceeded the national average (5,931) by approximately 30% over the last five years, catching the eye of entrepreneurs and high-profile investors such as Microsoft founder Bill Gates and Tampa Bay Lightning owner Jeff Vinik.

One of many accelerator programs the city has to offer includes innovation hub Embarc Collective. Tampa Bay, along with Southern Florida, Jacksonville and Orlando, all have advisory boards to the Florida Diversity Council, an organization committed to service as the premier resource for diversity best practices and leadership development in Florida. The programs and initiatives help support a more diverse economy to help startups thrive throughout Tampa Bay and Florida overall.

Jacksonville

Inexpensive business costs and a low corporate tax rate (4.46%) attract entrepreneurs who want to pocket more profit and reinvest in future growth opportunities.

PS27 Ventures, headquartered in Jacksonville, provides educational resources and access to investors to help businesses grow sustainably. The organization taps into an expansive network of accredited investors to support Florida-based startups locally. Citing tax laws that are more favorable in Florida than in the Northeast, investors increasingly focus capital here, specifically with artificial intelligence, virtual reality and 3D printing technology companies.

While each city has different things to offer, all of them present the unique Florida lifestyle that makes time outside of work even more enjoyable. Now more than ever, people are looking for work-life balance and maximizing what the “life” part has to offer.

Whether you’re enjoying the beaches near Jacksonville and Miami, the Bay in Tampa or the theme parks in Orlando, there’s something special about Florida living that appeals to rank and file employees and top-level executives alike.

Author is an economist and Florida Realtors’ Director of Economic Development for Florida Realtors

© 2021 Florida Realtors®

https://www.floridarealtors.org/news-media/news-articles/2022/02/best-places-start-fla-business

‘Zillow Offers’ Lost $881M in 2021 Shutdown

Report: Zillow Group said on Feb. 10 that it lost $528M in 2021, primarily because its iBuyer division, Zillow Offers, shut down with an $881M loss.

NEW YORK – On Feb. 10, Zillow Group said it lost $881 million on its algorithmic-driven home-flipping business last year. It was the first earnings report since the real estate company shut down that operation in the fall.

The full company, which includes Zillow’s profitable home-listing and advertising business, posted a consolidated net loss of $528 million in 2021, mostly because of its home-flipping business, Zillow Offers.

In November, the company announced it was closing Zillow Offers because the tech-powered platform failed to accurately predict movements in home prices. Zillow also cut about 2,000 jobs, or one-quarter of its staff, and wrote down losses of more than a half-billion dollars on the value of the remaining homes connected with Zillow Offers.

The company said it generated about $8.1 billion in revenue last year, though Zillow Offers was responsible for about $6 billion of it. CEO Rich Barton said the company would grow revenue by expanding the reach of its financing services and working to get more people to use Zillow to tour homes.

Zillow said it had sold, or had agreements to sell, more than 85% of its remaining inventory of homes from its defunct flipping business.

During the fourth quarter, Zillow lost an average of about $25,000 on every home it sold, before interest expense, though it sold those homes faster and at much smaller losses than it had expected. According to YipitData, Zillow still has about 8,600 homes on its books.

Source: Wall Street Journal (02/10/22) Parker, Will

© Copyright 2022 INFORMATION INC., Bethesda, MD (301) 215-4688

https://www.floridarealtors.org/news-media/news-articles/2022/02/zillow-offers-lost-881m-2021-shutdown