With today’s considerably lower Miami Beach real estate prices, the large inventory of foreclosures and bank owned property the question becomes more of what kind of property is worth investing in than anything else. For purposes of this article, we’ll focus on bank owned properties, also known as REO (real estate owned) property.
A home becomes real estate owned if it doesn’t find a buyer during a property auction. Since banks aren’t necessarily designed to function as Miami Beach real estate property-owners, they’re usually very eager to get rid of them which can result in considerable discounts. However since an REO is not the same thing as a foreclosure, lenders can still earn a profit from them so don’t expect as deep of a discount.
A perk of buying a Miami Beach real estate REO is that there’s much less of a risk of dealing with liens, taxes and other unforeseen costs that come with a foreclosure since lenders will take usually deal with them before the sale is closed. However an REO can still be in bad condition like a foreclosure so it remains important to get a home inspection or check the home out yourself, lenders are not at all obligated to make any repairs on the property but they will allow you to back out if something is seriously wrong.
Posted at 10:24:21 AM
Thursday, March 5, 2009
Examining the Interior of a Home
If you’ve been browsing through Miami Beach real estate on the internet, you’ve more than likely come across numerous resources thoroughly explaining how important it is that you carefully consider where the home is located, the values of neighboring homes, etc. If you’ve done your homework, perhaps it’s time to narrow down your assessment to the home you may soon be living in by giving the interior a meticulous examination.
Perhaps you’d like to start off with the electrical wiring. Depending on your familiarity, you may wish to leave this to a professional or have it done as part of the home inspection report, should you request one. Always check this part out regardless of whether the home was built ten years ago or five years ago.
The plumbing is a little easier. Leakage can often be discovered just by taking a look behind sinks since that’s the spot where mold has the best conditions for accumulating. A leaky sink could be an indicator of bad pipes and thus plumbing, something you likely want to bring to the appropriate person’s attention before signing off on the dotted line on your Miami Beach real estate purchase.
Not all homes come with an addict but if there is one, you may wish to make it your first stop. If you want to examine the roof, the attic is the best spot to do so. If there’s wood that shows wear and tear, this could lead to leakage later on.
Posted at 11:00:29 AM
Wednesday, November 26, 2008
Compiling Comparable Sales
With the advances in technology and the widespread availability of the World Wide Web, there is more real estate information available than ever. Realtors have a number of resources available to help them with their seller and buyer assistance efforts and among these, it’s important to have a good idea of average sales prices in any given neighborhood, officially known as comparable sales and often referred to simply as comps.
Depending on the state where the realtor is doing business, obtaining information on comps can be done by simply heading over to the local courthouse and browsing through public records or reading newspaper listings to get a glimpse of recent sales figures. However this method means that such services need to actually be provided in order to make use of them.
The most readily available resource is the internet since there are many websites available which can be used for finding comparable sales information while removing the need to do a lot of unnecessary and possibly fruitless legwork. Keep in mind though that there is no guarantee as to how current this information may be. A similar approach is to subscribe to service companies which can mail or offer this information via other means besides the internet. Even so, the same problems of encountering outdated information are still there.
The MLS can be extremely useful and if the person using it is already a licensed realtor then they have access to a wealth of information on multiple listings which is more often than not kept up to date.
At the end of the day however, perhaps the best way to have the sharpest knowledge on comps is to take the self research approach and focus on a certain neighborhood and staying abreast of sales.
Posted at 4:43:12 PM
Friday, October 31, 2008
Existing Home Sales Rose Nationally Last Month
While the economy seems bleak with the stock market fluctuating daily and a steady amount of major companies going bankrupt or merging, the real estate market seems to be headed down a different path. Month-after-month the real estate market has slight improvements. Experts think the worst declines in the real estate market have already past while the economy still has a while before it stabilizes.
Recent reports from the National Association of Realtors (NAR) show an increase in existing home sales. Home sales were up 5.5 percent with a total of 5.18 million units sold across the country in the month of September which was higher than the previous month by 1.4 percent. Lead economist for the NAR Lawrence Yun suggests this is part of “a sales turnaround which began in California several months ago…” and “is broadening now to Colarado, Kansas, Minnesota, Missouri and Rhode Island”.
The cause of this influx of real estate business, according to NAR President Richard F. Gaylord is “low home prices and low interest rates”. The nearly thirty percent discounts in home prices in major cities and rural areas have attracted buyers back to the real estate market in certain areas of the country. Richard F. Gaylord is optimistic about recent gains and thinks the real estate market is on its way to recovery.
Lawrence Yun, while also optimistic about the recovery of the real estate market, warns of “market disruptions” on the road to real estate market recovery. The credit markets have a significant impact on the real estate market and as they experience tough times it may have averse effects on the real estate market. But that aside, the NAR is predicting that the worst for the real estate market is over and that it will recover sooner than the economy itself.
Posted at 10:53:28 AM
Friday, September 5, 2008
Global warming, damaging fuel emissions, they’re all more of a concern on people’s minds these days as they become more and more aware of their long term effects on the environment and how important it is to try and incorporate “green practices” into your daily lifestyle whether that means doubling up your recycling efforts or reducing the amount of time you spend sitting idly in traffic.
In real estate, many developers have taken into account how they too can make homes “greener” and many have made use of natural resources to create environmentally friendly condo buildings like Ten Museum Park which uses its glass design to allow tons of natural sunlight to come into the building, thus reducing the need to flip on artificial lights, at least during the day.
The Ten Museum Park condo is only a small part of a bigger picture. Its home, downtown Miami is recognized not only by its sweeping business and condo skyscrapers, but also the numerous and elaborate light displays that bring the city to new life during the evening. Obviously all this visual eye candy, while certainly nice to look at does not do the environment any favors. Thus, to reinforce the message of how important it is to turn off nonessential lights whenever possible, Ten Museum Park and all those other high rises in downtown Miami’s will turn off their own unimportant lights on March 29 in a global effort to encourage environmental awareness.
Regardless of whether you live in a Miami single family home or a luxury condo, the efforts required by you to help out the environment even a little are that simple: turn off lights when you leave a room, drop a plastic water bottle or soda can into a recycling receptacle instead of the trash. It may seem useless but it’s always good to know you’re doing your part in making the world you share with everyone else that much more pleasant.
hat require little to no repairs. Don’t get caught up in the fierce competition without having a limit of how far you’re willing to bid, always remember the winning bid is only a component of the other fees that follow. As you learn the ropes, you’ll eventually get a feel for how real estate auctions work and who knows, if you become good at it, they may become your preferred method of buying Florida real estate.
Posted at 2:50:44 PM
Tuesday, June 24, 2008
International Florida Real Estate Assistance
To some degree the foreclosure situation has transitioned from how to prevent foreclosures to how to get rid of the hundreds of foreclosure properties already available on the market. South Florida homes are among the highest in foreclosure filings, contributing to an already overcrowded housing glut. The answer to appeasing the situation may lie beyond the U.S. borders.
Strategic Real Estate Advisors is an asset management firm situated in London that plans to raise $1 billion dollars in order to purchase luxury property like Miami Beach oceanfront condos currently owned and being sold by the banks through the Florida Prime Residential Opportunity Fund.
Itâ€™s interesting to note that not only is Strategic Real Estate Advisors located outside of the United States, the majority of the funds which will go towards the purchase of all these luxury properties will be coming from well to do investors and funds located throughout Europe and the Middle East. Recent reports have consistently pointed towards international investors and buyers as integral towards maintaining interest in Florida property investments and sales.
Critics may see Strategic Real Estate Advisorsâ€™ initiative as ineffective since they wonâ€™t be making a profit. The firm actually plans to buy and then hold onto these properties for next six years or so, a move that may cost considerable funds as the market fluctuates but which should bring considerable profit by the time it decides to sell them off as a residential property investment or something else entirely.
Within a seven year timeframe home values and the real estate market in general will certainly be in much better shape and buying activity will likely have increased so in a sense Strategic Real Estate Advisors are providing a worthwhile short and long term solution. Is this just another flash in the pan or is it a viable strategy?
Posted at 12:30:39 PM
Wednesday, May 28, 2008
Homes Are Selling Again
Amidst the doom and gloom of housing market reports comes a recent report suggesting the real estate market is showing strong signs of life. In these tumultuous times it's easy for people to think that the economy is headed for recession or even a crash. Despite current market reports that suggest we are beginning to see slow signs of recovery there are still those who would rather build a bunker under their homes to prepare for an apocalypse then invest in real estate.
The last half dozen months have not seen much progress in the way of homes sold. The highest percentage of drop in home sales occurred during that period leading many to believe that the market would eventually begin to recoverâ€”and it did. In April homes sales increased slightly, which wasn't enough to ease all tensions in the housing market but enough to show that the market is on the right track to recovery.
Property value also rose slightly across the nation showing encouraging signs of the real estate market's enduring strength. Though the median home value is comparably low to just four years ago the fact that property value is stabilizing across the country is a sign that things will return to normalcy sooner than later. When property values experience steady rise it will be more practical for people to sell homes and to convince investors to buy homes.
So, how should one react to recent reports of trends reversing in real estate? Real estate transactions rising are a sign that demand for property is still alive. Prices are almost at a low enough level that many people sitting on the fence on whether or not to invest will soon become active. As sales increase, so will home values and soon real estate investments will become stable enough to return to business as usual.
Shark Tank star and real estate icon, Barbara Corcoran, is the latest to weigh in, telling TMZ that, Nows the time to score a steal, they said. She told us buyers who are willing to pay special attention to details can find properties discounted by as much as 25. Shes seen it happen in NYC, and says that kinda deal wont be uncommon due to the harsh economic reality facing millions of Americans. She says if sellers are willing to list right now during a pandemic, its likely because theyre desperate to unload the property. That adds up to great deals...if youre able to buy now.
So, if youre looking to make a move right now, what do you need to know and what should you be looking for?
Yes, its crass to say that one persons loss is anothers gain. But the reality is that some of those whose jobs and/or finances cant withstand an economic downturn may end up losing their homes. Its not out of line to think that there is going to be a new wave of foreclosures >
Between the low mortgage rates and the potential for home prices to come back down if there is a glut of distressed properties that hit the market, there could be a good buying window for buyers.
This could also be a good time to consider real estate as an investment toolespecially in light of the recent stock market drop and those low mortgage rates.
Withnbsp;historic low rates, it is a good time to consider investing in real estate, Victoria Shtainer, a real estate agent and expert at Compass in New York, told Realtor.com. Low rates give you more buying power, and we have been negotiating amazing deals for our buyers. Given the current volatility in the stock market, investors are reassessing asset allocations in their portfolio, and considering how real estate may fit into this from an asset allocation standpoint.
Realtor.com added that buying an investment property can be a valuable asset and a good way to generate passive income, and it might also provide tax write-offs and incentives that you wouldnt get on other instruments.
For a historical perspective on real estate vs. stocks, check out this piece by Bigger Pockets, which provides a ton of data points as well as this nugget: Throughout modern history, residential real estate has actually boasted an extremely high rate of return with low risk.nbsp;
A few things to keep in mind when buying now
Given the current situation around the coronavirus quarantine, the way you buy a home will likely be different. You cant expect open houses or, in many cases, in-person home tours, right now Although, youll likely walk through a home you wish to purchase with an inspector during your escrow process.. Your escrow timeline may also be impacted.
"I recommend working with your lender early, even before the offer is accepted," Beatrice de Jong, consumer trends expert atnbsp;Opendoor, told Business Insider. The home buying process is taking longer than usual, and you could end up waiting around if you dont get a jump start.
The delay is partially due to the fact that lenders have been inundated with refinancing applications from existing homebuyers, but also because of work-from-home mandates that limit what some of the professionals involved in the process can do.nbsp;
Yes, the influx of refinancing applications has overwhelmed lenders but thats not the only reason the process is slowing down, they said. Many companies employees are now working from home, which sometimes hinders them from working as quickly.nbsp;
That can affect multiple aspects of the escrow process, like the appraisal. The appraiser physically has to go out to the house...Many of them are actually asking to have quarantine clauses built in, Andy Taylor, General Manager ofnbsp;Credit Karma Home, told Business Insider. They want to know that the home theyre going to isnt under quarantine because someone there is sick from this virus thats going around.
Youre working from home, which means youre bored, and youre looking for stuff to do. If you own your home, that stuff probably means home improvement projects. Weve got tips on what to tackle during the quarantine.
Do an even deeper clean than usual
It is spring, after all. This year, in addition to annual spring cleaning list, add a few tasks that are specifically intended to kill germs and improve the air quality in your home.nbsp;
Its best to check if your cleaning materials are in the list of approved products >
Its also a good time to change your air filters and opt for a better quality than you typically get. They wont prevent coronavirus, according to experts. Your typical HEPA filter is not going to be able to remove coronavirus from the air, Dr. Erin Sor>
But, they can help keep dust and pollen away, which is important for household members who have allergies and breathing issuesif you buy the right ones.
Regular HVAC filters are intended to protect the equipment, not your lungs and sinuses, said Airista. While ordinary furnace and ac filters do help to remove some dust from the air when changed regularly, they do little to trap the microscopic particles that cause the sneezing and wheezing of allergy season. Thats why you need special air filters for allergies that are designed to stop those tiny particles. They are called high energy particulate air filters or more commonly, HEPA filters. Because HEPA filters are made from densely packed layers of glass fibers instead of paper, the best ones are able to trap more than 99 percent of pollen, dust and smoke particles and keep them out of the air you breathe every day.
After youve identified that your filter is HEPA, look for the MERV rating. HVAC HEPA air filters for allergies are rated on how well they block particles of different sizes. The rating system is called the minimum efficiency reporting system, or MERV. The ratings range from MERV 1 to MERV 12, with the higher number indicating filters that are capable of removing the smallest particles, including many species of pollen.
Have some leftover paint around the house? Touch up those walls and baseboards. If not, home improvement stores are still open if youre able to get out and, if you do, be sure to abide by the appropriate social distancing rules and take proper safety precautions. Walmart also has paint, so you can pick up a couple of cans when youre getting groceries or other necessities.nbsp;
A fresh coat of paint will refresh your space and also make it feel newwhich you probably need right about now.
Clean out your closets
Face it: Even the most organized among us can have a messy closet, and now is the time to make it right, said Curbed. Start by taking everything out of the closet, purging whats no longer used, and cleaning the interior. If its a clothes closet, sort your clothes by category and be sure to hang delicate items and stack thicker things like denim. Put your most-used items at the front, while seasonal or ra>
Build a garden
Not only will it give you something to do, but also something to eatwhich can come in handy if the quarantine period goes on for an extended period of time. Fast-growing vegetables likes arugula,nbsp;lettuce,nbsp;radishes,nbsp;spinach, andnbsp;turnips can go from seed or seedling to harvest size innbsp;40 days or less, said The Creative Vegetable Gardener.
Stick to projects that are not super labor intensive or that will take a long time
Getting projects taken care of in this interesting time is about making smart choices. Someone in the family could get sick, or you could be called back to work sooner than expected. You probably dont want an unfinished project when its time to get back to regular life.nbsp;
Limit the products you need
You could run into supply chain issues, backorders, or delivery issues with your renovation, which could delay or derail your project.nbsp;
Answer: CCamp;Rs stands for "Covenants, Conditions amp; Restrictions". CCamp;Rs include the Declaration, Bylaws, Rules, Regulations, Policies and Resolutions.
As far as standing up in court, no one can predict the outcome of a judge or jury decision. But the board has a responsibility to make sure all rules, regulations and policies are in writing, distributed to all owners and residents and easily accessible when needed website recommended for 24/7 access. If the HOAs rules are fair and uniformly enforced, most judges will rule for with the board.
Question: I am an HOA treasurer and have been attempting to implement spending controls. We have two board members who regularly purchase items for the HOA and want to be reimbursed. My concern is that expenditures are unpredictable and hard to track. Ive proposed that all expenditures by these individuals must be for budget approved line items. This was rejected by the board as being too restrictive. What do you think is a reasonable policy?
Answer: It sounds like your HOA has a long history of directors spending money as they saw fit. Your well intentioned controls were predictably not well received by the Old Guard. The first question that comes to mind is: Has the old routine caused budget overruns? If yes, you have a sound basis for your controls. If no, you may be making much ado about nothing.
That said, it is not common for random directors to routinely spend the HOAs money. In self managed HOAs, the president and treasurer generally handle payments, occasionally reimbursing a director for an HOA expense that cant wait for the normal payment process. Ideally, if you have a hired manager, all expenditures should be routed through the manager. It is much easier to hold an employee or contract manager accountable than a fellow director.
Your biggest obstacle doesnt seem to be opposition to good financial management practices, but perception that such is not needed. Getting a barge to change course takes time. Continue to press for change. The board has a fiduciary duty to run HOA business in a business-like way.
Question: I recently took over professional management of an HOA which has over 70,000 of unpaid water bills. The water department has threatened to shut off service within 48 hours. The board directed me to impose a special assessment of 1000 per unit without a meeting or member vote. Can an emergency special assessment be imposed without member approval?
Answer: You need to read the governing documents to see what authority the board has to raise special assessments. Even if the board has authority to do so, proper and reasonable notice must be given to the members and time to raise the cash.
If a special assessment requires approval of the members, a member meeting needs to be called with advanced written notice. The meeting must have a legal quorum and a legal majority vote as defined by the governing documents. You may be able to pull this off by mail in ballot if your governing documents allow it. But none of this could possibly take place within 48 hours.
The board needs to make immediate and adequate payment arrangements for the water bill, perhaps by getting a short term loan from the bank. Or, you might be able to get the water department to leave the water on if money is on the way special assessment or loan. But they will, no doubt, want to see the written evidence letter from bank, copy of special assessment notice, etc..
The bigger question is, if this HOA has allowed things to get so bad that basic utilities cant get paid, what other fires are you going to find that they want you to put out? This crisis didnt happen overnight and the board likely has others waiting in the wings. Unless you are getting paid extra to deal with these special circumstances, you need to seriously evaluate whether this is an account worth your time.
Question: Our professional manager is pandering to certain board members and ignoring policies passed by the board majority. How do you keep a manager from getting involved with Board politics?
Answer: The board president has primary authority over the manager and should speak to the manager directly and plainly about this problem. Most managers are only trying to please or do their job. It may be a simple misunderstanding. If, however, there is conscious subterfuge and unwillingness to change, the matter should be addressed directly with the management company owner. If change isnt forthcoming, the president should recommend to the Board that there be a change in management company.
On the other hand, if the manager is kowtowing politically to board president who is abusing her authority, the remaining directors need to have a heart to heart with the president. All officers serve at the pleasure of the board. If one is exceeding authority, the board can remove and replace that person with another director who wont.
Question: Our bylaws indicate that expenses are shared equally. We have one and two bedroom units that vary significantly in size. Dividing expenses equally seems unfair. Can we simply vote to change it? If so, how many need to vote in favor of it?
Answer: Occasionally, developers propose an expense allocation like the one you describe. Its easier to calculate but clearly overlooks disparity in size and value. When there is substantial difference in square footage, the norm is to allocate expenses according to a units square footage as a percentage of the total units square footage. In that case, the expense share may range, for example, from 2 to 5 depending on unit size.
When developers ignore the unit size issue, the inequity usually becomes apparent after turnover. Then, those that feel they are carrying a bigger share than they should lobby to "fix it". The problem is that fixing it requires 100 consent from those that will pay more and those that will pay less. In this regard, individual owners have the protection against a majority foisting its financial will on the minority whenever it sees fit. Its different when it comes to a rule that applies to everyone, like No Pets. A majority could vote to eliminate pets but the same rule would apply to everyone.
If a majority of the owners were allowed to change the expense allocation formula without this 100 requirement, theoretically 51 of the owners could pass an amendment that would force 49 of the owners pay 100 of the expenses. So expense allocation is one area that absolutely requires 100 consent of those affected. While its theoretically possible to achieve if 100 are willing, people are people and there is usually someone that refuses to budge.
Bottom line listen up developers, the expense allocation formula needs to be fair from the get-go. After turnover, its too late to change.
Question: One of our homeowners wants to start an HOA newsletter. A few board members object to starting a newsletter because people dont read the minutes as it is, the board would need to review it and finding someone to do it consistently may be difficult. What say you?
Answer: Having a regular newsletter is not just a good idea, its a basic good management practice. To encourage readership, the newsletter should be worth reading and provide information that all members need to know. If certain members dont choose to read it, thats up to them. The HOA should not withhold information because of it.
The board secretary generally previews the newsletter for content and accuracy. This doesnt take much time for a two to four page newsletter more than ample for most HOAs.
Newsletters do not need to be long and involved, just timely and >
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