Real Estate is coming back, doing great ! Are you sure about that ?

Prices gains in all markets.

Foreclosure numbers declining steadily.

These are surely signs of a great comeback of real estate.

Or are they?

In the last five or six years I have hardly sold any property to a Florida individual resident. Not exactly. About three years ago I sold a small distressed condo to a local investor at a giveaway price. 

The rest has all been out-of-town buyers, foreign buyers, vacation homes, bottom-feeding out-of-town investors.

I have been thinking a lot about it lately. 

What has happened to what we used to call "normal people" ? Those young couples in search of a first home, the "empty-nesters" selling their larger houses to get into smaller apartments ?

I am not talking about the wealthy South American seeking a home in his new country of adoption. 

I am referring to plain American buyers, my friends, the friends of my kids, those who, in a not so distant past, would have been calling me to ask for my expertise. 

They are all but gone. 

Perhaps I am getting old and my kind of clientele is naturally changing. I might be getting referrals from other strata of society. I am getting wealthier and world-wide-known. Could that be ?

Or could it be that perhaps the country has changed, or Florida has changed?

Florida is a place of retirement, a place of vacations. That explains why many of my prospects call me from France, or Argentina, Canada, or New Jersey, or Chicago. 

But does it explain that these have become ALL my clients ?

I am suspecting that real estate problems have not quite ended and might even be worsening.

Affordability of homes is the keyword. Of real homes, not multimillion-dollar condos on the beach, or luxury private guarded neighborhood homes.

Can an average thirty or thirty-five year-old person dream of owning his own home at this time?

Yes he can,  if he can solve all of the following questions:

• Pay with a normal income a home mortgage, the homeowner and hurricane insurance, the property taxes, the maintenance expenses; and at the same time manage to keep the total of these payments below a 30% of his monthly pay-stubs ?

• Put together an amount sizable enough for a down payment, and all expenses associated with a home purchase?

• Manage to arrive to this stage with an almost immaculate credit report ? 

• Be confident about his present job security and the stability of his income (or the combined income of his couple) ?

If he has managed to solve all these points,  he can get to the next step.

Which is:

• Find a suitable property whose seller is willing to accept an offer that is not a "cash with no financing ontingency" deal.

• Find a seller that is ready to be very, very patient, because now starts the following point which is:

• Get the mortgage loan. As you might suspect, those same banks who were so generous in generating and granting these incredibly easy -and trashy-  loans (that they would later resell to unsuspecting investors) are now the most strict, severe, inflexible lenders in the history of the world. 

I have assisted to a couple of these loans and if it hadn't been awful and almost tragic, I would have called it hilarious. I swear that these guys wouldn't make a loan to their own bank!  Endless requirements. Exaggerated insurance obligations, paper,  documents, statements, constraints, more papers. Where did your money come from? We need proof that it's all yours, not your dad's, and so forth. 

But wait!  If it was an apartment in a condominium building, here comes the best. Is your building approved by Fannie Mae?  Does your building have too many tenants?  Does your building maintain reserves? Does your building have more than a certain percentage of investor owners? 

Not in compliance of all this and some more? You're out of luck, my friend. And guess what? Most buildings won't pass the test.

What's funny is that most of these Fannie Mae requirements are addressing problems long gone now,  which were precisely originated by the complete lack of ethics and rules in the famous "real estate balloon" years and which do not present a real problem nowadays. The scope of this blog does not allow me to explain why, but it is evident. 

Of course, all this can be avoided  or eased if you can remedy the problem with a 40 or 50% down payment, or even better: just buy it all cash.  Which bring us back to my dear foreign buyers and investors. 

Do I have the solution?

In a certain way, if we correct all the above, we'll get it right.

Which means:

• Get normal people back to making a decent income. The ratios that mortgage lenders traditionally established are reasonable as long as they are adapted to reality.    Perhaps we should build smaller homes, but it is evident that the national average income in real dollars has gone sharply down in the last thirty years or so.

• Get them steady jobs. Bring back the good jobs to America.  Good jobs will allow all of us to maintain better credit reports, and by the way send our kids to colleges, feed them better, keep them in better health, educate them better, and make this country's economy roll again.  

• Keep decency and ethics in the mortgage business, but letting those who got us in the big mess dictate the new rules can be a matter of discussion.

Ranting again!   And just because I read the following article today:

Report from RealtyTrac

Most Housing Markets Still Worse off Than in ‘06:

Most housing markets are faring better than they did in the depths of the recession, but the recovery still has a long way to go.

Just 8% of housing markets in 410 U.S. counties are better off than they were in 2006—a year that predates the crisis, according to a new report from RealtyTrac. The report analyzes housing market health in 410 U.S. counties over the past eight years in two-year intervals. Market health is measured according to four metrics: home price appreciation, affordability, percentage of bank-owned real estate sales and unemployment rates.

Still, while a majority of housing markets have yet to return to their pre-crisis standards, the report shows that the worst effects of the crisis have largely passed. A full 96% of housing markets are better off than they were in 2010. Eighty percent of housing markets are also in a better state than they were in 2012, suggesting continuing improvement.

“The housing recovery has taken root in hundreds of counties across the country,  and almost all local housing markets are better off than they were four years ago when foreclosure activity peaked,” RealtyTrac vice president Daren Blomquist said in a press release Friday.

Roughly 1 million homes went into foreclosure that year and “we saw less than half that number of bank repossessions nationwide in 2013,” Blomquist said.

"Even in hard-hit markets like Stockton, [Calif.], Las Vegas and Lansing, Mich., where real estate owned sales represented more than half of all sales in 2010, the percentage of [real estate owned] sales has been cut at least in half," Blomquist said.

Home prices in three-fourths of the counties included in the report continue to hover below their 2006 levels. But low inventory in cities like Seattle, San Francisco, Denver and Oklahoma City has led to rapidly appreciating home prices in those areas, according to the report.

"Those rapid home price gains are causing a concerning drop in affordability rates in some cities, but homebuilders and homeowners with regained equity should help provide more supply to balance out many of those markets in 2014," Blomquist said.

 Read in the National Mortgage News – March 23, 2014

Henry B. Nathan

is a Real Estate Agent at

United Realty Group Inc.

Please call me for your real estate assistance at:

 (800) 416-2747   (954) 296-6741

Email me: hbnathan@gmail.com

Visit my website: www.condo-southflorida.com

www.miami-new-construction.com

www.golden-beach-homes.com

www.goldenisles-homes.com

Explaining the $8,000 Tax Credit

Congress has passed legislation granting a tax credit of up to $8,000 to first-time home buyers.

Let's see what it's all about. To qualify, you need to be a:

a) First-time home buyer purchasing a home between January 1, 2009 and December 1, 2009.

Clock is ticking!

b) A“first-time home buyer” may not (or their spouse) have owned a residence during the three years prior to the purchase.

b) Tax credit is only applicable on primary residences, including: single-family homes, condos, town homes, and co-ops.

c) The maximum amount allowable is $8,000. It is determined by the price of the home . Maximum credit is 10% of the purchase price up to $8,000.

d) Only buyers with maximum incomes of $75,000 for single persons or $150,000for married couples are eligible for the whole credit of $8,000

e) Buyers with incomes between $75,000 and $95,000 if they are single or between $150,000 and $170,000 if they are married couples filing jointly, may receive the tax credit, but its amount will decrease as the income(s) approaches the maximum limit.

f) Incomes over $95,000 for singles and $170,000 for couples will automatically disqualify buyers from getting this tax credit. (God forbid you make more than $170,000 in 2009! )

g) Beneficiaries of the tax credit need NOT to pay it back, but (there is always a but!) they must occupy the home for at least three years. If they sell it during the first three years, they will have to give it back at the time of the sale.

h) The tax credit can be used to pay closing costs.

i) U.S. Department of Housing and Urban Development has ruled that, in FHA loans, the tax credit can be used upfront. Accordingly, FHA approved lenders can develop bridge loans that would allow the coverage of closing costs, or buy down their interest rate, or increase down payment over the minimum 5 percent.

j) These bridge loans cannot cover the minimum 3.5 percent down payment.

k) Of course, there are other sources of assistance for buyers needing help with the 3.5 percent down payment, including state and local government programs and nonprofit lenders.

Henry B. Nathan is a Florida Realtor at United Realty Group Inc.

and a Florida Licensed Mortgage Broker.

Call me: (954) 296-6741

Or visit my website: http://www.condo-southflorida.com/

where you can also search for

Hallandale Beach Condos, Sunny Isles Condos,

Aventura condos

Books and Readings

At the dawn of a new presidential term, and with no intentions of venting out my political preferences, I find it important to spread around interesting ideas which can help explain what has gone wrong in our country and our economy and what new directions are being suggested to rebuild our nation’s wealth and success and regain our position as world leaders.

A provocative book that have drawn my attention is:

The Predator State:

How Conservatives Abandoned the Free Market and Why Liberals Should Too.

By James K. Galbraith.

Without endorsing its contents ( I am far from being an economist) I found some answers to the agonizing questions of how to save capitalism and a free society after the cataclysmic events that threatens to throw us back to depression-like poverty and hardship.

Here is a synopsis of The Predator State:

The cult of the free market has dominated economic policy-talk since the Reagan revolution of nearly thirty years ago. Tax cuts and small government, monetarism, balanced budgets, deregulation, and free trade are the core elements of this dogma, a dogma so successful that even many liberals accept it. But a funny thing happened on the bridge to the twenty-first century. While liberals continue to bow before the free-market altar, conservatives in the style of George W. Bush have abandoned it altogether. That is why principled conservatives -- the Reagan true believers -- long ago abandoned Bush.

Enter James K. Galbraith, the iconoclastic economist. In this riveting book, Galbraith first dissects the stale remains of Reaganism and shows how Bush and company had no choice except to dump them into the trash. He then explores the true nature of the Bush regime: a "corporate republic," bringing the methods and mentality of big business to public life; a coalition of lobbies, doing the bidding of clients in the oil, mining, military, pharmaceutical, agribusiness, insurance, and media industries; and a predator state, intent not on reducing government but rather on diverting public cash into private hands. In plain English, the Republican Party has been hijacked by political leaders who long since stopped caring if reality conformed to their message.

Galbraith follows with an impertinent question: if conservatives no longer take free markets seriously, why should liberals? Why keep liberal thought in the straitjacket of pay-as-you-go, of assigning inflation control to the Federal Reserve, of attempting to "make markets work"? Why not build a new economic policy based on what is really happening in this country?

The real economy is not a free-market economy. It is a complex combination of private and public institutions, including Social Security, Medicare and Medicaid, higher education, the housing finance system, and a vast federal research establishment. The real problems and challenges -- inequality, climate change, the infrastructure deficit, the subprime crisis, and the future of the dollar -- are problems that cannot be solved by incantations about the market. They will be solved only with planning, with standards and other policies that transcend and even transform markets.

A timely, provocative work whose message will endure beyond this election season, The Predator State will appeal to the broad audience of thoughtful Americans who wish to understand the forces at work in our economy and culture and who seek to live in a nation that is both prosperous and progressive.

The cult of the free market has dominated economic policy-talk since the Reagan revolution of nearly thirty years ago. Tax cuts and small government, monetarism, balanced budgets, deregulation, and free trade are the core elements of this dogma, a dogma so successful that even many liberals accept it. But a funny thing happened on the bridge to the twenty-first century. While liberals continue to bow before the free-market altar, conservatives in the style of George W. Bush have abandoned it altogether. That is why principled conservatives -- the Reagan true believers -- long ago abandoned Bush.

Enter James K. Galbraith, the iconoclastic economist. In this riveting book, Galbraith first dissects the stale remains of Reaganism and shows how Bush and company had no choice except to dump them into the trash. He then explores the true nature of the Bush regime: a "corporate republic," bringing the methods and mentality of big business to public life; a coalition of lobbies, doing the bidding of clients in the oil, mining, military, pharmaceutical, agribusiness, insurance, and media industries; and a predator state, intent not on reducing government but rather on diverting public cash into private hands. In plain English, the Republican Party has been hijacked by political leaders who long since stopped caring if reality conformed to their message.

Galbraith follows with an impertinent question: if conservatives no longer take free markets seriously, why should liberals? Why keep liberal thought in the straitjacket of pay-as-you-go, of assigning inflation control to the Federal Reserve, of attempting to "make markets work"? Why not build a new economic policy based on what is really happening in this country?

The real economy is not a free-market economy. It is a complex combination of private and public institutions, including Social Security, Medicare and Medicaid, higher education, the housing finance system, and a vast federal research establishment. The real problems and challenges -- inequality, climate change, the infrastructure deficit, the subprime crisis, and the future of the dollar -- are problems that cannot be solved by incantations about the market. They will be solved only with planning, with standards and other policies that transcend and even transform markets.

A timely, provocative work whose message will endure beyond this election season, The Predator State will appeal to the broad audience of thoughtful Americans who wish to understand the forces at work in our economy and culture and who seek to live in a nation that is both prosperous and progressive.


Henry B. Nathan is a Florida Realtor at United Realty Group Inc.Visit my website: http://www.condo-southflorida.com/where you can search for Aventura Condos, Florida Condos

The Wave Condos on Hollywood Beach

The Wave Condos in Hollywood Beach
2501 S. Ocean Drive

A good alternative for nice condos on Hollywood Beach. Check this out.

Built in 1968
Completely renovated in 2004
550 Units
17 Floors

A beachfront condominium building, in a great location.
It is the product of a recent condo conversion. Building has sustained extensive renovation.

A great alternative on Hollywood Beach, right on the sand.

Studios, one and two-bedroom units.
Many with good ocean views.

Preferred by beach lovers, a relaxed atmosphere is the mark of the Wave.
Well located, close to the Hollywood Boardwalk, the Diplomat Hotel, and a short drive to the Casinos and Aventura Mall.





Amenities:

Heated pool and spa
Party room
Fitness Center
Valet Parking
Bar
Executive room with wireless internet
Billiards room
Piano Room
Washer/Dryer in unit

For more information, please call
Henry B. Nathan
(954) 296-6741
or

Henry B. Nathan is a Realtor in South Florida. Please visit my website and search of the top real estate database. Great Search Tools will make your search enjoyable and successful. http://www.condo-southflorida.com

Creative Taxation

Is that a good definition?

Davie sets the tone on what we can expect from our local governments.

I have been a permanent advocate of lower property taxes.

A key source of employment in Florida, housing construction, sales, financing and maintenance are major components of our economy. Property taxes have increased well above the official inflation rates during the last two or three decades.

Thousands of new homes and condos in every location have surely tremendously broadened the taxable base of most cities in South Florida. That has not been enough to feed the appetite of voracious cities and counties.

A couple of lukewarm regulations by our Florida congressmen have aimed to ease homeowners’ pains, as well as an amendment recently approved to increase the homestead exemption amount. Our taxes are calculated on the assessed value of each property, which is determined by the county property appraiser’s office, multiplied by the “millage” which is determined by the local governments.

While our legislators have focused on reducing the assessed values, local governments are starting to defeat this purpose by increasing their millage, which is what was to expect, and I wrote about it a long time ago.

However, the flood of new service charges that many cities are implementing is starting to look more and more as double taxation. Charging us for services traditionally covered by our property taxes is the new plague that relentless local authorities are uncovering. I wouldn’t be surprised if the cop handing you a ticket for a traffic violation could include an additional bill for his “services” with a "thank you for your business" remark, or if a local library could charge you a “shipping and handling” fee every time you pick a book.

Here is an example of this kind of creativity. The city of Davie is today's winner. Read this article from the Sun Sentinel.

By Susannah Bryan - South Florida Sun-Sentinel - September 30, 2008

Accident response fees are so controversial that five states — Georgia, Indiana, Missouri, Pennsylvania and Tennessee — have passed laws to ban them.

Yet Davie on Wednesday is set to give final approval to a measure that would bill at-fault residents and out-of-towners an estimated $840 for costs associated with responding to car accidents. If it can't be determined who is at fault, all parties would be billed.

"It is a cost recovery fee for people who are creating havoc on our highways," Councilwoman Susan Starkey said on Monday.

If approved, Davie would become the first municipality in South Florida to charge such a fee. The town tentatively approved it 3-2 on Sept. 17, with council members Michael Crowley, Marlon Luis and Susan Starkey supporting it. Mayor Tom Truex and Councilman Bryan Caletka rejected it.

As Davie moves ahead, insurance companies are working to persuade Florida to ban such fees. They argue the fee will raise insurance rates and is really a hidden tax.

"We have been trying hard to fight back," saidWilliam Stander, assistant vice president of Property Casualty Insurers Association of America, a trade group that represents more than 1,000 companies nationwide. "The idea that you should have to pay for police and fire services, it's offensive."

Insurers lobbied five states to ban the accident fee and each agreed because of concerns over double taxation.

State Rep. Martin Kiar, D-Davie, said the issue may come up in Florida this legislative session.

"People are having such a tough time making ends meet," Kiar said. "For the cities to impose another fee, it's just not fair to our people."

On July 28, Pembroke Pines commissioners voted against a similar fee, citing concerns it would expose the city to costly legal challenges. Officials in Plantation, Miramar and Southwest Ranches, who had briefly considered the idea, say they have dropped it.

If approved, Davie would hire Dayton, Ohio-based Cost Recovery Corp. to bill insurers. If they don't pay, nonresidents would get a bill but residents would not.

Supporters argue that Davie responds to more accidents than other cities because it is surrounded by Interstates 95, 595, 75 and Florida's Turnpike. As proposed, the fee would apply to accidents on highways and local roads that require emergency response, including those outside town.

Critics say the fee may lead to a tit-for-tat mentality, with cash-strapped cities passing similar laws to raise money.

In July, Weston City Manager John Flint said his city would likely charge an accident fee to residents of cities who impose such a fee on Westonites. But on Monday, Mayor Eric Hersh said he opposes such a plan.

"If everyone starts charging, it's really nothing but an increase in taxes for everybody," Hersh said.

The plan also doesn't sit well with Steve Breitkreuz, a councilman in nearby Southwest Ranches.

"It doesn't sound neighborly," he said. "It creates animosity between the towns. It may set a precedence that will ripple out through the communities and we'll all be looking out for our own."

Henry B. Nathan is a Florida Realtor at United Realty Group Inc.Visit my website: http://www.condo-southflorida.com/where you can search for Aventura Condos, Florida Condos,