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S. Florida home prices are climbing back

South Fla. home prices climbing back

MIAMI – July 31, 2013 – Seven years after the South Florida real-estate bubble stretched as far as it could, buyers continue to pump more air into the deflated market.

New numbers from the S&P/Case-Shiller real-estate index for South Florida show home values up 14 percent this year. That’s the best 12-month gain since July 2006.

“I don’t hear people say they’re worried anymore,’’ said Charlette Seidel, a co-managing broker at Coldwell Banker’s Coral Gables office. “Buyers are confident.”

But even with prices on a steady climb since early last year, the damage from the bust remains.

Case-Shiller, the most closely watched real estate index in the country, shows South Florida values remain 41 percent below where they were at the peak of the boom in May 2006. Case-Shiller released its May 2013 numbers on Tuesday, offering a detailed look at seven years of what might be the worst real-estate crash in South Florida history.

The grimmest reading came in November 2011, when the Case-Shiller index showed a 51 percent decline from South Florida’s May 2006 peak. The rock-bottom prices brought another boom in sales, largely fueled by foreign investment dollars. But with prices so low, few homeowners are opting to sell. Realtor groups cite a lack of listings as the main reason sales aren’t even higher.

The combination – high demand and low supply – finally brought momentum to the recovery in early 2012, with both sales and prices heading higher.

May marked the 17th straight month of gains in South Florida’s Case-Shiller index. That’s the best streak for South Florida since the market peaked in May 2006. At the time, Case-Shiller showed values going up every single month since August 1999 – 82 months in all.

But even with Case-Shiller showing steady improvement in South Florida and across the country, the gains have some real-estate watchers warning of another bubble. A year ago, Case-Shiller, which tracks sales of single-family homes, showed prices up only 3 percent in South Florida. Now, they’re rising at a pace almost five times faster, with a 14 percent surge.

Jonathan Miller, a New York appraiser who tracks South Florida’s market, said the economy is too weak to be fully confident in a real estate rebound.

Miller, president of Miller Samuel Inc., said he won’t join in the conventional wisdom of “calling this a housing recovery.”

“I call it a period of better housing stats,” he said.

Waiting could be costly!

What Will Waiting to Buy a Home Cost You? (July 18th,2013)

At the end of June, mortgage rates for a 30-year fixed-rate mortgage jumped to 4.5 percent, up from 3.9 percent on June 1 — and a notable jump from the historically low 3.35 percent monthly average rate toward the end of 2012. However, while higher rates do mean an increase in monthly mortgage payments, experts are urging potential home buyers not to resign themselves to renting for the next few years just yet — it’s still a good time to buy a home.

These moderate increases in payments may still be manageable, particularly if buyers look at less expensive properties, or negotiate a lower price.

For example, the difference in monthly payments for a $200,000 home at 3.9 percent and one at 4.5 percent is just $70.03. If budgeted correctly, this could be a manageable expense.

Rick Allen, chief operating officer of Mortgage Marvel, is one expert who says now is still the time to buy a house. His platform records online mortgage loan applications, about a million transactions a year, which serves as a barometer for how well the housing market is doing. He says that refinances are down, as to be expected with a rate increase, but that “shouldn’t scare people off.”

“Relatively speaking, rates are still at or near historic lows,” says Allen. “A 4.5 percent mortgage is still an incredibly attractive rate at which to finance a home. From a real estate perspective, we’re not far off from recent lows, and we’re heading to improve real estate values. The combination of those two factors make this still a good time to buy.”

As the unemployment rate continues to decline, Allen says we’ll see more potential homeowners enter the market as well. Though Allen says “theoretically, rates could go through the roof or back down to the floor” but he personally believes we’ll see rates around 5 percent through the end of the year.

This is the early stage of the recovery of the housing market, and the rising interest rates encourage potential home buyers to be more decisive, and act quickly. As more homes are bought, supply decreases, so prices may rise even further. So if you’ve been thinking about buying a home, don’t lose your confidence, but it may be prudent to act quickly as rates continue to rise.

Real estate ownership rights for same-sex couples

FORT LAUDERDALE, Fla. – July 10, 2013 – Question: My partner and I are looking to buy our first house together, but Florida doesn’t recognize our marriage. Does the recent Supreme Court decision help us in terms of owning real estate? – Steve Answer: Not yet. It’s likely to be a while before the high court’s marriage ruling trickles down to real estate law. Typically, when a married couple buys a home, they do so as “Tenants by the Entireties,” which is a legal status of ownership that gives the spouses certain privileges. For example, when one spouse dies, the other automatically owns the property alone without any further action. While same-sex couples aren’t allowed to own property this way in most jurisdictions, including Florida, a similar bundle of rights can be created. I have long advised that unmarried couples buying property together enter into an agreement regarding the management of the house. That pact also should specify what happens to the home if the relationship sours. Same-sex couples should follow this advice as well. They can set up a trust agreement for the ownership of the house, and the details of the agreement can help decide what happens in the event of a split or death of a partner. Certain types of trusts can even provide for protection from creditors, if that’s an issue for you. So while the simplicity of Tenants by the Entireties ownership structure is not yet available to most same-sex couples, proper planning can give them the same legal protections. About the writer: Gary M. Singer is a Florida attorney and board-certified as an expert in real estate law by the Florida Bar. He is the chairperson of the Real Estate Section of the Broward County Bar Association and is an adjunct professor for the Nova Southeastern University Paralegal Studies program. The information and materials in this column are provided for general informational purposes only and are not intended to be legal advice. No attorney-client relationship is formed. Nothing in this column is intended to substitute for the advice of an attorney, especially an attorney licensed in your jurisdiction.

U.S. home construction rises 6.8% in May

WASHINGTON (AP) – June 18, 2013 – U.S. builders stepped up home construction in May and applied for permits to build single-family homes at the fastest pace in five years. The gains show housing remains a key source of growth for the economy.

The overall pace of homes started rose 6.8 percent last month to a seasonally adjusted annual rate of 914,000, the Commerce Department said Tuesday. That offset part of the 14.8 percent decline in April. May’s rate is still below March’s pace of more than 1 million – the fastest in five years.

Construction increased in May for both single-family homes and apartments and condos.

And builders sought more permits to build single-family homes, which make up nearly two-thirds of the market. The seasonally adjusted annual rate rose 1.3 percent to 622,000 – the highest since May 2008. That’s a sign that construction will increase further in the coming months.

Overall permits fell 3.1 percent in May to a seasonally adjusted 974,000. But that was because of a drop in apartment permits, which are more volatile.

Overall, the report points to more evidence of a housing recovery that has become sustainable. New-home construction has risen 28.6 percent since May of 2012.

“Starts have clearly been trending up,” said Jim O’Sullivan, chief U.S. economist at High Frequency Economics. “While levels are still low, housing has been the strongest part of the economy in growth terms.”

Improved hiring and low mortgage rates have encouraged more people to buy homes. The increased demand, along with a tight supply of homes for sale, has pushed home prices higher.

Stronger housing markets are helping the economy grow and offsetting some of the drag this year from higher taxes and federal spending cuts.

A better outlook for housing has made builders more optimistic, leading to more construction and jobs. The National Association of Home Builders/Wells Fargo builder sentiment index released Monday rose to 52 this month, up from 44 in May. That was the highest reading in seven years and the largest monthly increase in more than a decade.

A reading above 50 indicates more builders view sales conditions as good, rather than poor.

Still, some markets are recovering faster than others. In May, housing starts rose 17.8 percent in the South and 5.7 percent in the West. But they fell 13.7 percent in the Midwest and 9 percent in the Northeast.

Many of the nation’s major homebuilders have reported strong annual growth in sales during the spring home-selling season. The increased demand has paved the way for builders to raise prices and ramp up construction of more homes, despite lingering concerns over rising costs for land, building materials and labor.

Though new homes represent only a fraction of the housing market, they have an outsize impact on the economy. Each home built creates an average of three jobs for a year and generates about $90,000 in tax revenue, according to NAHB statistics.

HUD and VA provide homes to 915 homeless Fla.

MIAMI – June 10, 2013 – About 915 homeless veterans living in Florida will soon find a permanent place to call home.

U.S. Housing and Urban Development (HUD) Secretary Shaun Donovan and U.S. Department of Veterans Affairs (VA) Secretary Eric K. Shinseki announced that HUD will provide $60 million to local public housing agencies across the country to provide permanent supportive housing to homeless veterans, many of whom are living with chronic disabling conditions. Florida will receive $6,000,620 to assist its homeless veterans.

The HUD-Veterans Affairs Supportive Housing (HUD-VASH) Program provides the assistance, which combines rental help from HUD with case management and clinical services provided by VA. Since 2008, a total of 48,385 vouchers have been awarded and 42,557 formerly homeless veterans are currently in homes because of the program.

“Our veterans have answered the call of duty,” says Donovan. “That’s why our nation has its own duty – to help homeless servicemen and women rejoin the very communities they have given so much to protect.”

The grants are part of $75 million appropriated this year to support the housing needs of homeless veterans. Local public housing authorities provide rental assistance to homeless veterans while nearby VA Medical Centers (VAMC) offer supportive services and case management. HUD expects to announce more HUD-VASH funding later this summer.

VAMCs work closely with homeless veterans then refer them to public housing agencies for these vouchers, based upon a variety of factors, most importantly the duration of the homelessness and the need for longer term more intensive support to obtain and maintain permanent housing. The HUD-VASH program includes both the rental assistance the voucher provides and the comprehensive case management that VAMC staff provides.

Veterans participating in the program rent privately owned housing and generally contribute no more than 30 percent of their income toward rent. VA offers eligible homeless veterans clinical and supportive services through its medical centers across the U.S., Guam and Puerto Rico.

Florida communities that received funding:
• Jacksonville Housing Authority: $250,787
• Housing Authority of the City of St. Petersburg: $207,005
• Tampa Housing Authority: $286,531
• Orlando Housing Authority: $741,708
• Miami Dade Public Housing and Community Development: $327,024
• Housing Authority of City of Daytona Beach: $104,984
• Sarasota Housing Authority: $160,403
• West Palm Beach Housing Authority: $260,719
• Housing Authority of the City of Titusville: $149,258
• Ocala Housing Authority: $60,908
• Seminole County Housing Authority: $99,143
• Housing Authority of the City of Stuart: $113,421
• Housing Authority of the City of Fort Myers: $321,960
• Pinellas County Housing Authority: $251,168
• Alachua County Housing Authority: $378,397
• Tallahassee Housing Authority: $391,246
• Broward County Housing Authority: $895,956