Deborah Ward – Page 19

Can You Afford A Tampa Bay Waterfront Home

October 27, 2021 By Deborah Ward

The cost of a home isn’t just the price to purchase it. Homeownership also includes things like insurance. In Florida not only is homeowner’s insurance part of the cost, but also flood and hurricane insurance. That can make owning a waterfront home in Tampa Bay more expensive, but not impossible either!

Over the last 5 to 10 years Florida has dealt with some very destructive storms. Because of that many insurers won’t write any kind of real estate policies in the state. That makes owning a waterfront home problematic, but not impossible.

Homeowners insurance

Homeowners insurance is a policy that protects the homeowner from a few different things. First is liability issues should someone injure themselves while on your property. Second, it covers damages to the property in the case of a fire, break-ins (including property stolen) or other kinds of disasters that don’t involve floods or hurricanes. There are different riders, or additions that you can add. Your mortgage company will require that you have a policy, and will probably escrow money monthly to pay the premiums for you.

Flood insurance

Flood insurance is procured through a federal program that requires certain areas to have insurance that will fix your home if it is flooded. Obviously, living at the waters edge is a place that will require it! Again, your mortgage company may require it as well and may escrow and pay the bill from the escrow. Flood insurance will pay to fix your home and replace damaged items if it is flooded. The problem may come in when the flood is because of a bad storm or hurricane. Which leads to…

Hurricane insurance

Hurricane or storm insurance is insurance you can purchase that will fix your home and replace belongings damaged in a bad storm. As several bad hurricanes have proven in Florida, they can be utterly devastating. The Gulf area is sometimes spared hurricanes, but not always. Purchasing hurricane insurance is prudent.

Yes, it all adds up, and finding a company that will write policies for waterfront homes that are affordable can be challenging, doing so isn’t impossible, and is a smart move.

Should You “Test The Market” With A High Price To Start

October 27, 2021 By Deborah Ward

It sounds like a good strategy, “test the market” by asking a high price for your home. I mean, what harm could it do and you could even luck out and get asking right? Well, not so fast. It’s not a good strategy and here’s why.

Who will and won’t see your home?

For one thing, when you “test the market” the people who can actually afford your home at the right price won’t even see it. Most people start searches online but even if they start with a Realtor, the searches the Realtor does won’t include your home. Those that do see it won’t be interested. Your home will be too small or not what their price range usually offers. Of course, that means you won’t be getting any offers. Unfortunately, your neighbor who is also selling will. Your overpriced home makes their correctly priced one look good. Not to mention that the first few days your home will be on the market are the golden ones. Most deals are made then.

Remember today’s buyers are very savvy

People know what a home is generally worth. They do their homework. They also will be less likely to want to try and negotiate a deal. If they even see the listing. That means your home is sitting and a stale house doesn’t sell for asking, or even for less than the true market price. It’s true. When you lower a price because you asked too much to begin with, those who are interested will demand a bigger discount and more concessions.

What if you do get an offer?

So let’s say you actually get a bite at your first price. Guess what? The house won’t appraise at the high price and the buyer won’t get a mortgage. No mortgage, no sale.
Oh, and if you find a Realtor who thinks it’s a good idea, find a different one!

What is a Jumbo Loan – Does it Matter to You or Your Luxury Realtor

October 27, 2021 By Deborah Ward

A jumbo loan is a mortgage on anything above $417,000.00 and your luxury realtor can help you figure out if you should sell your luxury property above that amount.

So now you’re selling your luxury property in Florida. Perfect, because people are starting to get back into the market, even for luxury properties. However, like most people, they’ll need a mortgage, which means a jumbo mortgage. That changes the picture, mostly about who you want to sell to, and here’s why.

Conventional mortgages actually have limits as to how much it can be written for. Why? Because mortgages are commonly bought and sold on secondary markets, and are backed by FNMA (Fannie Mae) and FHLMC (Freddie Mac). Over certain amounts neither will back the mortgage. Those mortgages are considered jumbo loans. A jumbo mortgage is a mortgage that is above the conventional mortgage limit of $417,000.00. They were common in many areas of the country when property values were at their peak. Most mortgage companies offer jumbo loans in the conventional formats like fixed rate or interest only loans. There are also LTV or loan-to-value limits that lenders have as well. For most jumbo loans there is usually an 80% or 90% loan-to-value limit on the loans.

Jumbo loans are risky for mortgage companies because of the lack of federal backing. Another reason is because luxury properties can be harder to sell in a short amount of time. Why is this problematic? Well if the buyer defaults on the loan, a short sale will probably not happen. Larger luxury homes are more apt to be affected by valuation shifts. This can hurt a lender if the property goes into foreclosure. Interest rates are usually a bit higher on jumbo loans as well.

In Florida, any mortgage loan over $417,000 is considered a jumbo mortgage. This is lower than other areas of the country, and may mean that the definition of “luxury properties” is different in Florida. If you are selling a property you need to ask your realtor about how to price your home. Why? Those jumbo loans are harder to get, and adjusting your price down just a few thousand dollars may mean the difference between a lot of bids from prospective buyers with conventional mortgages, and someone who will need to qualify for a jumbo loan. It will matter not only to your luxury Realtor but also to you in the long run as a jumbo mortgage may be harder for your prospective buyer to get.

Looking for a GREAT Tampa Bay Luxury Realtor who can help you make sure your home is priced right? Give us a call today 727-410-0336

The New Housing Boom – Baby Boomers Are Selling Their Big Homes And Downsizing

October 27, 2021 By Deborah Ward

There is a new housing boom and it’s coming from baby boomers who are selling their homes and downsizing into smaller ones. It’s a good thing for new homeowners and those upsizing as well.

As the children of baby boomers leave home for college and beyond, their parents are finding that their big homes are just a bit too big. They are also finding that they are facing a future that could mean lower incomes and inability to make larger payments on things like utilities, real estate taxes and such. The answer? Sell that big home that has the higher utilities and taxes. Use the equity as a nest egg. That also means that they will be looking for a smaller home.

That’s good news for owners of smaller homes who want to upsize for two reasons

The first is that there will be competition for their smaller homes: first time buyers and the downsizing boomers. Competition means possible bidding wars and higher prices. Those higher sales mean more money to purchase the bigger home with less debt. That’s always good news. The second reason is the higher chance of getting a cash sale. It means a faster settlement and less red tape for both sides.

Bigger homes and upsizing families

Then, of course, there is the homes that the boomers are vacating. They are the bigger homes that the upsizing families are looking for. With more and more of them available it will mean better prices for those buying. Yet another plus for those smaller home owners.

For baby boomers it means buying a home without the need for a mortgage, smaller utility bills, lower real estate taxes and costs. It could also mean adding money into the retirement sources of income.

So this housing boom of sorts is a win win for both baby boomers and the owners of the smaller homes they want.

Do You “Bring Money To The Table” if Your Dream Home Doesn’t Appraise?

October 27, 2021 By Deborah Ward

You looked at dozens of houses and finally found the home of your dreams. You made an offer and it was accepted and the appraisal was ordered. Fantastic! Or not… the home doesn’t appraise for your offered amount. Now what?

Some reasons it doesn’t appraise enough

This happens a lot. If the markets are rising appraisals and comparable sales don’t keep pace which can mean lower appraisals affect sales.

Sometimes it’s the fact that distressed sales, meaning foreclosure sales and short sales, skew the appraisal. That affects the ability of buyers to get a mortgage for the home.

Generally lenders will only lend funds up to a certain percentage of the appraised value of the home. Typically this is 80% of appraised value or loan to value as they call it.

If your appraisal is too low you can do a few things

One is to walk away. Why start out with a home with a negative equity value?

Two, you can go back to the sellers and renegotiate the sales price. More likely than not there will be a contingency clause in your contract that will allow that.

Third, you can ask for a second appraisal. It’s possible that the first appraiser’s estimate wasn’t accurate. It may mean asking for a value appeal where the original appraiser reconsiders, or asking your lender if they would accept a second appraisal.

The last thing you can do is just come to the table with more money to make up the difference.

That brings up a few questions

First, do you have it? Remember the mortgage lender is going to ask you for proof of where the extra funds came from which could also affect getting your mortgage.

Another question you should ask is would you pay more for a car, dress or couch than its worth? Then why would you buy a home for more than it’s worth? Think it through, talk with your Realtor and make the best decision for you.

Sometimes it is worth bringing a bit of money to the table to get your dream home and sometimes it just isn’t the best solution. Only you can make that call!

The RIGHT Way To Do Your Internet Home Search

October 27, 2021 By Deborah Ward

Most people start their home search online. Makes sense because most people start their search for anything online. With all the sites out there, is there a right way to do an internet home search? Yes, and here is how to do it.

Start with the right site

Use Realtor.com for your search. Realtor.com is the most up to date site since it is integrated with the MLS system. That means that it has real time data that is always up to date.

Other sites don’t have this and you could find that the homes you like are already off the market because the site isn’t real time.

Make a list of must haves

Before searching come up with a list of things that you must have and would like to have. Be specific about musts versus likes. “Musts” are deal breakers if they aren’t there, “likes” are extras that would be nice, but can be added later and won’t kill the deal. It will also help you narrow your search.

You should also know your price range

It should be based on your budget. You can start with Zillow Zestimates, but use that as a starting place, not the final word on whether you can afford a home or not.

Don’t rely on the selling agent for how much home you can afford. they represent the seller and not only has their interests in mind, but their commission as well.

You should apply for and become pre-approved for your mortgage. Your mortgage company will be able to tell you how much home you can really afford.

Now you’re ready to start your search

You know your price range and your must haves. Stick to that range. Remember that a seller won’t discount their home by a large sum just because you looked outside your range and fell in love with their home.

Be smart, search the right way and your new home will be yours soon enough!