let's do the numbers
30-year fixed-rate mortgage: 6.04%, up from 5.72% the previous week.
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 Portability, homestead application deadline is Monday
If you or a client sold and/or bought a homestead in 2007, remember that Mon., March 3, is the deadline to apply for homestead exemption and portability of Save Our Homes tax benefits. Taxpayers who sold a homestead in 2007 and purchased a new home before Jan. 1, 2008, are eligible to apply some or all of their Save Our Homes tax benefits to the new home. The Save Our Homes benefit is the difference between the assessed value and market value of a homestead property due to the annual limit on increases in assessed value. Taxpayers who already applied for a homestead exemption on their new home must complete a separate application by March 3, 2008, to transfer the Save Our Homes benefit to the new homestead. Application forms for portability are available from the local property appraiser and from the Florida Department of Revenue Web site.
Say it isn’t so
In another major setback for Florida’s troubled property insurance market, State Farm Florida announced it would stop writing new policies effective March 1. State Farm is the largest private property insurer in Florida, covering more than a million properties. The move impacts residential, rental and commercial policies. The announcement follows a decision last summer not to renew some 50,000 policies for coastal properties in order to minimize the company’s hurricane risk.
Meanwhile, there are some new insurers on the scene. They’re smaller than State Farm but they’re writing new policies, lowering rates and giving homeowners an alternative to the state-run Citizens Property Insurance Corp. Among the newcomers:
- American Integrity Insurance (1-888-359-5515) has absorbed thousands of Citizens policies. The company says it will start selling coverage in the “traditional voluntary market” in April.
- Edison Insurance Group (1-800-657-6618) hopes to add 8,000 policies on all home types within 1,500 feet of tidal water in 2008.
- Privilege Underwriters Reciprocal Exchange (PURE) (1-888-813-7873) specializes in insuring large homes worth at least $1 million that meet current building codes.
More resources on the Web:
Market watch
- The mortgage credit crunch and a sluggish economy continued to affect the sales pace of existing homes and condos in Florida in January. Last month, 6,737 existing single-family homes and 2,252 condos sold statewide, a decline of 28% and 30%, respectively, according to FAR. The statewide median sales price for existing single-family homes was $208,600 (14% below January 2007 levels); for condos, it was 190,200 (11% lower than a year ago). Still, for single-family homes, a median price of $208,600 represents a 46% increase over five years. In January 2003, the statewide median sales price for single-family homes was $142,900.
- The Florida housing market echoes what’s happening nationally. Yesterday, NAR reported January homes sales fell 23.4% from a year ago to a seasonally adjusted annual rate of 4.89 million units. The national median existing-home price for all housing types was $201,100, down 4.6% from January 2007. Lawrence Yun, NAR chief economist, says many potential buyers remain on the sidelines. “Subprime loans and other risky mortgage products have virtually disappeared from the marketplace, and over the past five months, this has been reflected in soft but fairly stable home sales,” he notes. “As the increased limits for FHA and conventional loans are implemented, more buyers will have access to safer FHA loans and lower interest rate loans in high-cost areas, which could lead to steadily higher home sales later in the year.”
 Now hear this
Fort Lauderdale broker and real estate trainer Steve David brings his tried-and-true business and marketing techniques to the big screen—your computer screen, that is. A video of David’s 12-step program for succeeding in a challenge market is available at no cost to members on floridarealtors.org. “This isn't a bad market, it’s a pros market,” says David. “Only the best techniques and strategies will work.” He offers tips on working with FSBOs and new homebuilders, recruiting and making money from real estate investments. The 50-minute video is divided into chapters, which you can scroll through at your leisure.
Ignore the headlines
That’s the advice Jim Svinth, chief economist at mortgage firm Lending Tree, has for buyers who are waiting for housing prices to decline further. As the economy recovers, finance costs will rise. Waiting for the perfect time to get into the market may cost prospects, especially renters, more in the long run. “The thing that will make home prices stop falling is the very same thing that will push mortgage rates higher,” says Svinth. Any savings you might incur by a further drop in prices might be offset by rising financing costs. Let’s take a home priced at $250,000. With a 20% down payment and 30-year fixed-rate mortgage at 6%, monthly payments would be $1,199.10 (principal and interest only). If the price of this home were to drop 10% a year from now to $225,000, but mortgage costs rise to 7%, the monthly payment for a 30-year fixed-rate mortgage with 20% down would be $1,197.54 (mortgage and interest only) — a difference of $1.56 a month.
Visit FAR’s Great Time To Buy Florida Web site for more proof that there’s never been a better time to invest in Florida real estate.
 Mark your calendar
Is your real estate license up for renewal next month? Remember, the Department of Business and Professional Regulation (DBPR) has waived the renewal fee for brokers and sales associates, but both must still pay the $5 assessment for the unlicensed activity fund. You may renew your license online at the DBPR Web site.
© 2008 FLORIDA ASSOCIATION OF REALTORS ®
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