Buying a waterfront home in the Keys

First off, congratulations at looking to the Keys for a possible vacation home. The good news about the Keys from an investment angle are: There is only so much waterfront or Coastal property available. The Keys have strict environmental laws that affect building permits. This means there are only so many homes and always will be a limited number of homes here. One big reason for this is there is just ONE Highway in and out of the Keys. (US1) If there is an emergency, people need to have the ability to leave quickly and so for this reason alone, the Keys will never be California. The other main environmental consideration is the water quality. The Keys main attraction are water sports and Monroe County is going to make sure that our waters are clean and usable. To consider when purchasing any waterfront vacation home and how the Keys measure up: Is there a view? Views really do matter. An unobstructed Ocean view adds as much as 60% to the value of a home per the Journal of Real Estate Finance and Economics. Proximity to Golf courses or a park can add as much as 20% to a homes value. This is per an article by a much published author named Soren Anderson, a writer from Manchester College. Consider the recreational activities… The What and the When. For example in a Ski resort area, your options are limited due to weather considerations and the total amount of activities available is definitely less. *In the Keys, about the only thing you cannot do year round are mountain climbing and white water rafting. Boating access and controlling depth Is there direct boating access on the property? If so, how large a boat can you have behind the home? This is determined by what we in the Keys call controlling draft or depth. For example: If a boat is under 30ft in most cases 3 ft draft is OK. Draft means...what is the lowest water depth you have to go through to get to open or deep water.If you have a sailboat or 50 ft boat you will need deeper draft such as 5ft. Now..obviously if you have a 50 ft sailboat behind your home, the canals or waterways have to provide you with turn-around room. If the access is deep draft, then expect prices to go up. If there is no water acess at the home or the draft is for kayaks only, in most cases expect a drop in price. If there is no direct water access...how far is the nearest boat ramp or is there a boat slip available? If so, is it included and what is the draft out of the boat slip. So the boating issue has a very direct effect on pricing here. Neighborhoods with bigger canals and deep draft boating are generally home to the Million dollar and plus homes. Nearby Medical and shopping options These are very important considerations. If there is an accident, how far away is a hospital? In the Upper Keys we have Baptist hospital in Tavernier which is an excellent option. If you need groceries or restaurants, what is nearby? Oftentimes vacation properties can be secluded and don’t offer easy access to the above. At first being remote can seem as desirable, but in the end it can grow old quickly. This also affects home values by the way. If you can have the vacation feel and recreation, yet have amenities nearby, the prices go up. On thing about the upper Keys is that Miami and South Beach are just about an hour away and World famous Key West, 2 hours. How much room do you need? If you own a home with nearby recreation and sightseeing, expect people to come out of the woodwork. Everyone will be your friend. Larger homes, with more bedrooms, a 3/2 and up always rent better. So if you can, get a home with extra space. Type of Construction or is it built to last. The age of the home will determine the building code that it was built to. In the Keys newer homes have to be built to strict specs as to wind handling characteristics. Also, look for low maintenance homes. Lots of homes in the Keys are made of concrete block and have pea-rock for yards and the outside is stucco over concrete or frame. This means lower maintenance, which is very important for an absentee owner. Finding renters Does the home have good rental potential and is there local rental management available? This is a very important consideration, both for long term and short term vacation rentals. Remember, even if you don’t want to rent, this can be an important consideration for a future buyer or if your situation changes. Home maintenance. Are there nearby electricians, plumbers, appliance stores and general contractors. If anything does happen, the prices to have things repaired or replaced will be less if there is competition and service people are nearby. Check with the REALTOR you are talking with to get a Vendor list of who the Real Estate company uses to service their rentals and offices. Rules and Regulations Make sure you are clear on and have copies of any deed restrictions or condo docs as to what is allowed and what is not. Too many rules can be appetizing for some but a turnoff for future buyers. For example if you have children who will want to use the property in the future as a college break, lots of communities can prohibit it. In conclusion, the upper Keys offer good investment potential from an appreciation aspect and income potential from renters. Regarding Appreciation. Because Miami and Ft Lauderdale are a short drive away, people there look to the Keys as a getaway. Think New York and the Jersey shore. We sell a majority of homes to people from these areas. Income potential. About 50% of the vacation renters in the Keys are from Florida. They come here because the Keys are a completely different experience. This means as Florida grows (it is on pace to be the 2nd largest state in the USA by 2010) we will have more people looking to vacation here. This will drive prices up and make rental occupancy rates climb even more.

Getting a desirable mortgage for buying a dream home is what everyone wishes for. A home is like any other product available in the market. So when shopping for a home mortgage prices and terms may be negotiable. When it comes to buying a home, a borrower has to overcome many financial obstacles. This is where home mortgage comes in. For more information visit this site and take help from the specialist here.

 

Overview on Short Sales and Foreclosures
The Basics of “Short Sales”
by William Bronchick

You will likely come across dozens of properties in foreclosure with little or no equity, that is, the seller owes at close to or more than the property is worth. In these situations, lenders are sometimes willing to accept less than the full amount due, commonly referred to a "short pay" or "short sale."

Negotiating a short sale with the lender is a difficult process, generally because it is a daunting task finding a bank officer who has the authority to accept a discount. You will have to call around to locate the lender’s “Loss Mitigation Department.” More than likely, each lender you deal with will have a separate name for this department, so be patient when calling. Much like getting your phone bill corrected, you can expect the process to involve a lot of waiting on hold and being bounced around an intricate maze of automated voice mail systems. Once you get in touch with the right person, then the negotiating begins.

From the lender’s perspective, a short sale saves many of the costs associated with the foreclosure process - attorney fee's, the eviction process, delays from borrower bankruptcy, damage to the property, costs associated with resale, etc. In a short sale scenario, the lender gets the property back faster, so it is able to cut its losses. Your job as the investor is to convince the lender that it will fare better by accepting less money now.

The lender will want some information about the property, the borrower and the deal he has made with you. Specifically, the lender wants to know what the property is worth. The lender will generally hire a local real estate broker or appraiser to evaluate the property (called a broker’s price opinion or “BPO”). You can also submit your own appraisal or comparable sales information. In addition you will want to offer as much specific negative information about the property as possible. Also, include some relevant information about the neighborhood and the local economy if things are bad (copies of newspaper articles with “bad news” may help). A contract’s bid for repair estimates should also be submitted, which, of course, should be the highest bid you can obtain!

The lender will also ask for financial information about the borrower. Sort of a backwards loan application, the borrower must prove that he is broke and unable to afford the payments. The borrower must show that he has no other source of income or assets to repay the loan. This process may involve as much, if not more paperwork than an original mortgage application! The borrower should submit a “hardship letter”, which is basically a sob story about how much financial trouble the borrower is in. This may require a little literary creativity, and some help on your part. Don’t lie, just paint a picture that doesn’t look good.

Finally, the lender generally wants to see a written contract between you and the seller. The lender wants to make sure the seller isn’t walking away with any cash from the deal. Generally, the contract must be written so that the buyer pays all costs associated with the transaction, so that the “net cash” to the seller is the exact amount of the short pay to the lender. A preliminary HUD-1 settlement statement is often requested, which can be difficult, since many title and escrow companies simple won’t prepare one in advance of closing. You can prepare your own HUD-1, and simply write “preliminary” on the top.

Don’t be surprised if your short sale bid is rejected. Lenders aren’t emotionally attached to their properties, so they aren’t as likely to give you “steal.” Many short sales fall through if the BPO comes in too high, which is often the case. You can’t pull the wool over a lender’s eyes - if the property isn’t is need of serious repair, it is unlikely you can convince the lender the property is worth a whole lot less than the appraised value.

If you are interested in these properties please contact me and I can furnish you a list of properties

Building a home in the Keys

Buying a lot and building your dream home may be the way to go. The cost of building will vary widely from $50.00 per square to $300.00 and up. Basically lots in Florida as far as price goes will run as follows. Most expensive • Open-water—Atlantic or Gulf • Open-water Inter-Coastal or other Rivers-Lakes • Canal Homes with Open water views (Bay or Atlantic-Gulf) • Canal homes-Boatable and quick access to open-water • Dry Lots—price varies widely, based on the community and area. *As to canal lots and how boat ability affects prices. If the depth of the canal and the width allows for a 50ft boat or sailboat-it will be more expensive than a lot on a canal that is shallow and usually not as wide. The bigger the boat, the more room needed to turn around. *Access to open water is another factor that influences prices. If you’re only minutes (half hour) to good fishing-diving, expect to pay more. Also homes on shorter canals will generally have better water quality. In the Keys we call these swimming canals. The tides flush them out easier and the water is clear. As of September 2005, per an MLS search, Vacant lots-Location-Number available and starting price. • Key Largo, 89 starting at $30,000 • Marathon, 446, starting at $35,000 • Key West 20, starting at $275,000 For prices on the individual keys please contact me. The prices will vary depending on depth of boating etc—see information below. Permit prices and restrictions will vary in each community. Generally the more environmentally sensitive the area is, the more restrictions there are in getting a permit. (Since the water is one of the main reason people want to be here, the state and the communities want to keep it that way. Important: Regarding pricing. The closer to the water and the deeper the boating,(boat draft-a 50 foot requires deeper water and wider canals than a flats boat) the higher the prices. Another thing to do is find out what flood zone the property is in per FEMA maps and then talk to a local insurer on how that will affect your rates. Do this ahead of time. #In all cases if you find a lot that you like, my suggestion is that you ask for a letter of build ability from the local zoning commission as a clause in your sales contract. Always-always, talk with the county yourself to get the update on the laws. So, yes, you can build here and it’s done all the time, but make sure you ask all the necessary questions and if you can, get it in writing. See the Biz directory for builders if that’s the way you want to go. If you want a new home contact a residential agent. REGARDING BUILDING Ask the REALTOR that you pick to help find you a good builder that will respond quickly. Another consideration is to buy a lot and build later (be careful here as building codes and laws can change due to density controls) I would first see how long it takes to get a building permit and then if you get one how long you can wait. In the Keys when you get a permit there is a limit of a couple years during which time you have to at least start the process (bring electric to the site-do a septic check etc) Since all this varies widely make sure you get all the answers, Probably best to go the the permit department yourself and have a discussion Monroe County permits You will probably need a building permit if you are: • Building a new building or Adding to an existing building • Renovating an existing building • Demolishing an existing building • Constructing a prefabricated structure • Moving or installing a mobile home • Installing/Modifying other miscelaneous structures • including fences, pools, decks, fireplaces, etc. You probably also need a permit if you are working on your structure's: • Electrical System • Plumbing System • Heating or Air Conditioning • Ventilation Systems State and or Municipal Licenses required • Plumbing • Electrical • Asbestos Abatement • Roofing Building Departments • MIDDLE KEYS OFFICE • 2798 Overseas Highway • Suite 300 • Marathon, FL 33050 • 305289-2501 • fax: 305 289-2515 • • UPPER KEYS OFFICE: • 88800 Overseas Highway • Tavernier, FL 33070 • 305852-7100 • fax: 305 852-7103 • • LOWER KEYS OFFICE: • Juvenile Justice Building • Room 2030 • 5503 College Rd. • Key West, FL 33040 • 305295-3990 • fax305 295-3994 Florida Building Codes • http://www2.iccsafe.org/florida_building_code/ The purpose of the Building Code is to protect the safety, health, and general welfare of the citizens through structural strength, stability, sanitation, adequate light and ventilation, and safety to life from hazards attributed to the built environment. This is accomplished through the implementation of building, plumbing, mechanical and electrical codes along with various state and local codes and standards Information on Complaints Against Contractors: Don't get nailed! Many citizens in Florida have fallen victim to dishonest, unlicensed or improperly licensed contractors. Florida Statute 489 requires all construction contractors to hold a valid contractor's license prior to engaging in contracting. Always require that a contractor show you a valid contracting license before you sign a contract. Some indications that a contractor may be unlicensed are: the contractor requests a large deposit or all of the money up front before any work has commenced, the contractor asks you to pull a "homeowner permit", the contractor pressures you to sign a contract "today or I can't give you this special price." To verify licensure of a contractor, you may call the State of Florida Dep't of Professional Regulation at 941 338-2373 or search their contractor licensing database. The City requires proof of licensure from contractors who pull permits for properties located in the City, so be sure to require that the contractor pull the permit in his name, not your name So always play it safe and do it right. This will certainly help you in the Insurance area also---The extra structural costs for doing it better really pay off if a Storm hits and or you decide to sell #The information above is based on my experience in the Florida keys, which is highly regulated due to environmental concerns. With regard to making any decisions, be sure to check with local and state permit and zoning authorities and/or a Real Estate attorney

Home inspections

What Your Home Inspection Should Cover
Siding: Look for dents or buckling

Foundations: Look for cracks or water seepage

Exterior Brick: Look for cracked bricks or mortar pulling away from bricks

Insulation: Look for condition, adequate rating for climate (the higher the R value, the more effective the insulation is)

Doors and Windows: Look for loose or tight fits, condition of locks, condition of weatherstripping

Roof: Look for age, conditions of flashing, pooling water, buckled shingles, or loose gutters and downspouts

Ceilings, walls, and moldings. Look for loose pieces, dry wall that is pulling away.

Porch/Deck: Loose railings or step, rot

Electrical: Look for condition of fuse box/circuit breakers, number of outlets in each room.

Plumbing: Look for poor water pressure, banging pipes, rust spots or corrosion that indicate leaks, sufficient insulation

Water Heater: Look for age, size adequate for house, speed of recovery, energy rating.

Furnace/Air Conditioning: Look for age, energy rating. Furnaces are rated by annual fuel utilization efficiency; the higher the rating, the lower your fuel costs. However, other factors such as payback period and other operating costs, such as electricity to operate motors.

Garage: Look for exterior in good repair; condition of floor—cracks, stains, etc.; condition of door mechanism.

Basement: Look for water leakage, musty smell.

Attic: Look for adequate ventilation, water leaks from roof.

Septic Tanks (if applicable): Adequate absorption field capacity for the percolation rate in your area and the size of your family.

Driveways/Sidewalks: Look for cracks, heaving pavement, crumbling near edges, stains.

www.REALTOR.org/realtormag Reprinted from REALTOR® Magazine Online by permission of the NATIONAL ASSOCIATION OF REALTORS® . Copyright 2003. All rights reserved

Homestead exemptions

In Florida, $25,000 of the assessed value of your home is exempt from real estate taxes, but you have to meet certain criteria to be eligible for the exemption. First you much have the title or record to your property as of January 1, and reside on the property. You have to be a legal and permanent resident of Florida as of January 1. When applying for the exemption status, bring along a copy of your deed or tax bill, and a Florida county voters registration or Declaration of Domicile. If you drive, you must also bring your Florida driver's license and automobile registration. New applications must be submitted in person at the appraiser's office, but renewals may be done by mail. For further information, consult the County Property Appraiser's Office.

Real Estate Taxes

All residents are subject to county taxes, but each city or special district levies taxes within its boundaries. City, special-district, and county taxes are combined in one tax bill. Real estate taxes are assessed as of January 1 each year. They are due and payable on November 1 and become delinquent if not paid before April 1 of the following year. Florida law holds the taxpayer responsible for receiving and paying tax bills in full. For additional information contact the County Property Appraiser's Office.

Establishing Residency

To establish residency, you may register to vote or file a Declaration of Domicile, which is an affidavit available at the CountyCourthouse. Filing one copy with the Circuit Court provides a record of your intention to make Florida your home. Simply moving to the State does not guarantee legal residency. For more information contact the County's Clerk of Circuit Court.

What is Homestead Exemption?
Florida Law entitles every person, who has legal or equitable title to real estate and maintains it as his/her permanent residence, to apply for a $25,000 homestead property tax exemption. A partial exemption may apply if the ownership of the applicant is less than 100%.

Am I eligible to file?
You must meet the following requirements as of January 1st:

Have legal or beneficial title to the property, recorded in the Official Records of County
Residency on the property
Be a permanent resident of the State of Florida
Be a United States citizen or possess a Permanent Residence Card (green card)

When do I file?
The deadline to file an application for exemption is March 1st. Under Florida law, failure to file for any exemption by March 1st constitutes a waiver of the exemption privilege for the year.
Regular filing is January 2nd - March 1st.
Pre-filing for the coming year is March 2nd - December 31st.

How do I file?
Take copies of the required documentation to your Exemption Department:Generally at the County or City Court House

TIPS FOR HOME BUYERS

Get Pre-Qualified

Get pre-qualified for a loan so you can determine the amount of loan you can afford.  Getting pre-qualified also increases your chance of closing a deal, when a contract is presented a seller is more likely to accept an already funded offer than one from a home buyer who still needs to get a loan.   It makes it so nice when you see a home you truly want to invest in and you know you qualify for the loan in advance it really adds comfort and security to your search.

Create a priority list of your needs & desires

Establishing your “criteria” early on will save time shopping for inappropriate homes, there are many homes available but if your priority is dockage and you require deep water control depth this will establish which subdivisions are appropriate to your need.  Please keeping mind your top reason for buying a home should be the value you are getting, so keep in mind you may have to sacrifice some of your amenities if an incredible value is available.

Shop your Mortgage

There are thousands of lenders competing for your business, create a chart that lists different types of loan, fees, etc. you want to avoid apples to oranges contrasts by comparing fixed rates to fixed rates not fixed to ARMS. One of the biggest decisions to make before putting a contract on a home is how to you are going to finance the purchase.

Get a Quality Home Inspection

It is absolutely essential to hire a qualified home inspector when making the biggest investment of your life to assure you peace of mind.  A qualified home inspector will provide you with a book explaining all plumbing, electrical, air conditioning, appliances, roofing etc. pertaining to your new dream home.

Sign A Contract That protects You!

Make sure that the contract you put on a house allows you to arrange financing, leaves you enough time for your due diligence for inspections
And spells out who pays what at the time of closing.