Barbara Wall Real Estate

The beat goes on in Brevard.

2009-06-28T20:28:00.001-04:00

Understanding that life is sometimes a dance, you go forward one and back two and then three forward. Real estate has the same rhythm, and the dance we are dancing is the quick step with all movements being forward.

Statistics continue to support the increased activity each month in Brevard County, and those who snooze will lose in this market. The premium homes and condos for these bargain prices are now showing that the best of the best are being absorbed. Local Realtors agree the correction in this market is being seen with multiple offers on good properties and some scarcity of listings in a few neighborhoods.

Financing still is the difficult part of the transaction and many cash buyers are showing their strength in selecting the values and knowing they can move forward quicker than others. The cash buyer controls the best transactions.

Appraisals continue to be the problem, with many of our local lenders using out-of-town appraisers. It is understood that appraisers are bidding for these jobs and lowering prices to be competitive. The out-of-town appraisal groups are undercutting the locals and capturing the jobs. Interesting that the cost does not appear to be passed on to the consumer. It is no wonder appraisals appear to show inconsistencies in the competitive properties selected.
The appraisers who are not in this market do not know which neighborhoods are considered comparable. Can the borrower insist on a local appraiser?

This appraisal problem, apparent in our area, does not appear to benefit the lender as many new loans are lost due to the low appraisals. Refinancing is effected in the same manner.
The lending institutions with strong local leadership will find a way to change this procedure and create the fairness this market deserves. For the first time in several years, it has been reported that developers are now coming into the market to capture the value of vacant land that is prime for new construction.

With the planning and permitting time period needed for development, the time may be right for land transactions to begin to show a significant increase in activity.
With a two- to three-year absorption rate for residential homes and the necessary time needed to prepare and plan for a development, it would be wise for developers to begin to take advantage of the low land prices and plan for the next several years.
As the hot summer sun beats on Brevard County, let the rhythm of the dance continue.

Realtors can offer guidance.

2009-06-21T20:34:00.000-04:00

Buyers are flocking to Brevard, and the reasons are clear. They have heard of the "eco tour" on our rivers, highlighting our natural wonders. They have heard of kayaking through the zoo to see animals in their natural habitat. Some have experienced skimming through the wetlands on an airboat. Others just enjoy the walk through the old towns, dining on the street cafes or enjoying the many theatrical performances our cities offer.

Although the interest rate edged up, the contracts continue to be written as buyers pounce on the great values in Brevard County. A good Realtor can help guide you through the process. Those looking at property on a daily basis know that the best buys are going quick. Yes, the market is beginning to change. The surplus still exists in all phases of the housing market, and prime properties are being scooped up by the knowledgeable buyers.

The time is right. Sellers who are pricing their properties correctly in this market are experiencing action and possible offers. Problems still plague the financing aspects of the real estate purchase, so buyers and sellers need to be aware of this possibility. Low appraisals also continue to be an issue.

The problem circumstances are highlighted in the condominium market. If the developer still owns a majority of the units, financing may be limited and almost, in some cases, impossible. If there is a program for special financing in these circumstances, I have not yet, found it but I am still searching.

Foreclosures continue, and short sales are changing. Investors specializing in short sales are contracting at a rapid rate, negotiating with the lender and flipping the property. Buyers and Realtors need to be aware that if the short sale is a flip, a lender for the buyer may require more time prior to financing. To further explain: a flip is when an investor contracts on the short sale and lists it for sale prior to the investor closing on such a property. Thus, it's reselling the short sale or flipping the property to a second buyer with the intent of capturing a profit in the second transaction. The transactions usually have a simultaneous closing where the investor closes in the morning and the buyer closes in the afternoon.

Fascinating! People are creative in every market. Knowledge is the key to closing on such a property. Researching the property, the seller, the lender and the flipping investor may be the keys to closing on this transaction if it is still a good deal for the buyer being represented.
Real estate is now a complex process. Working with a professional in the business full time is an absolute necessity in today's market.

The Realtors struggle with these changes as do the sellers and buyers, but a sunset walk on the beach will lower your stress level.

Buying on water an option...

2009-06-14T20:38:00.000-04:00

In the early hours today, the sun was rising and the water was like glass. It was just perfect.
In a spectacular three minutes, five dolphins splashed in the wake of our boat. They must have known my granddaughter was with us as they put on their performance.
Welcome to the waterfront in Brevard County.

News reports continue to boast that Brevard County is undervalued. When I search the Multiple Listing System on Realtor.com, I must agree that some of the best buys are on the waterfront.
Oceanfront condos still lead the way in an oversupply, thus, tremendous values are in this category. Canal-front homes are certainly available in price points that are hard to believe.
Riverfront under $1 million is a price range that did not exist in Brevard County for many years, yet is available in today's market.

The economy is consistently showing signs of improvement. Is this oversupply in housing going to exist for many years? Are people continuing to purchase at an increased rate? The fact is, the contracts are being written and negotiated to a meeting of the minds, with an increased rate of activity that continues. Still, I predict an oversupply in housing for several years.

A balanced market is not forecasted for two to three years if this action is consistent throughout a two-year period. Sellers who are wanting to buy in this market must agree to sell low and understand that they, in turn, will buy low. This will offset the impact of a low offer.
Now that the interest rate has increased -- but is still at a very low rate -- one needs to jump into this housing market before there's another rate increase.

Increases or decreases in rates are controlled by the secondary money market and the economic situation. Rates under 5.5 percent still are excellent rates. The truth is, one does not know what the future rates will be. Appraisals still are coming in on the low side. If a buyer or seller has no consistent proof of the price that is negotiated in a contract for sale and purchase, it is recommended that a special clause showing the contract is contingent upon an appraisal reflecting at least the value of the contract price and performed within two weeks of date of acceptance, be added to the contract.

Your Realtor can assist you with the wording. If the appraisal results are known up front -- that is, in the early stages of the loan process -- any adjustments that must be agreed by both buyer and seller are done prior to the seller moving out of the property.

Hopefully, this market devaluation will not remain in existence much longer. It is the low sales of the past that influence the value indicated by the appraiser. A cash contract is an exception as no appraisal is needed. Bring on the cash contracts.

Now is the time to buy!

2009-06-07T20:42:00.000-04:00

Wow! This market is exciting and challenging.

Real estate sales continue to sizzle as the summer heat comes to Florida. Carey Bay, in a DSNews article published June 3, writes,

"For the first quarter of 2009, only six states saw an increase in home sales,
and Florida was among the lucky few."

Carey further mentions that Central Florida seems to show more significant signs of recovery than other regions. The Home Building Industry is reporting an increase in new construction, which makes us all smile.

All of the indicators point to this being the right time to buy:

Federal tax rebate for first-time homebuyers in the amount of $8,000. Note: First-time homebuyers must finalize their purchase by Nov. 30 to get this tax credit.
Numerous financial assistance programs are available. Some offer a bridge loan to facilitate the use of the $8,000 tax credit as a down payment. Your Realtor can assist you with this information.
Continued low interest rates.
Continued availability of inventory in the housing market.
Press releases indicate Brevard County is undervalued.Predictions of a mild hurricane season.

For all the reasons listed above, the Brevard real estate market has continued to be blessed with this flurry of action as buyers review their many opportunities for valuable purchases in today's market. Real estate sales strengthen the economic situation in so many ways that this is the first indication of economic recovery. The real estate market continues to face obstacles in continued low appraisals, difficulty in closing short sales and frustrated buyers who have lost money on past home sales.

The positive effects of this action far outweigh the problems. We have all learned to tighten our budgets, find energy and money-saving ideas to lower our household expenses, analyze and prepare for loan processing problems and boost those low appraisals by cash sales showing some value stability in this market.

Under the new Foreclosure Alternative Program outlined by President Obama, there is some help to streamline the short sale process creating a positive effect in moving the inventory of short sales and expediting the closing process.Local lenders are offering flexible and creative financing programs to enhance the opportunities for financing. Jumbo loans are enticing buyers with new lower rates.

The beach salt air brings a tranquility to our busy lives, the shuttle allows us to marvel in our manmade accomplishments and the abundance of Florida wildlife fascinates us daily. We are so fortunate to live in Brevard County.

Brevard buyers picking up pace.

2009-05-31T20:48:00.000-04:00

The action is now moving from the low $100,000 price range to include up to the $400,000 range. This reflects the buyer's confidence in the upper middle values in today's market.
A slight increase in sales in the higher end market also reflects an increased confidence by buyers.

Fewer listings are coming on the market each month, giving a glimmer of hope for a change in this buyer's market . . . possibly sooner than the now-predicted three- to five-year period.
Interest rates continue to flutter but still hover below the 5 percent level, further enticing buyers to commit to purchase.

Prices continue to dip slightly but not nearly at the rate of depreciation in the past few months and the past year. Some neighborhoods show fewer to no available homes, but contracts reflecting any market appreciation are constantly stymied by low appraisals and are unable to close. As many buyers are now paying cash as are those who choose conventional financing. Federal Housing Administration and VA financing still are popular methods of purchase for moderately priced homes.

The luxury market is now being assisted by some lenders offering more competitive rates on jumbo loans, but lenders still are conservative in appraisals and loan-to-value ratios of 30 percent to 70 percent in this category.
Brevard County continues to find recognition for all it has to offer in housing, in climate, in beaches and lifestyle.

Having recently traveled to Alaska and finding cold temperatures in addition to rain, my heart still finds comfort in everything our area has to offer. Our own Northern Lights are the spectacular sunsets on the Indian River or the night launches that shake the earth with their power. No, we do not have the magnificent glaciers with aqua crystallized accents and the moose and bears that traverse the vast wilderness, but I will opt for the dolphins as they capture the bait fish.

I will enjoy the blue herons and our favorite river bunnies. And I will close my eyes at night as the stars and the moon shine through my window. There is nothing not to love in Brevard County. Spoken by a true native Floridian.

Things looking up for Brevard...

2009-05-24T20:52:00.000-04:00

As the much-needed rains continue to fall on Brevard County, the grasses get greener and the birds and wildlife are happier. As the buyers continue to bring the deluge of contracts on properties, the bankers, the sellers, and the Realtors begin to smile. Life in Brevard keeps getting better.

The interest rates flutter but we are promised continuous optimism in the financing arena. The stock market echoes our prediction of economic strengthening and the nation comes a little closer to ending our crisis. With still an abundance of inventory in our area, there is a long way to go before properties appreciate.

The market in 2004, 2005 and part of 2006 jumped so very high, that in order to bottom out, it had a long hard fall. It is estimated that values today in our area, are in the range of 2002 prices.
In a few states and cities that showed a minimal depreciation factor over the past several years, it should be noted that those areas did not show a significant amount of appreciation in 2004 to 2006. Those areas are in the minority as most states and cities across the United States jumped high and now have fallen back.

Continuous efforts to increase the market value are stifled by the conservative nature of the lending institutions who are wrapped in tighter regulations. Loan processing is tougher and longer than in the past year. Lenders require more information and documentation from buyers prior to a loan commitment.

Insurance rates have, for the most part, shown a slight decrease, and more significant decreases are seen if a wind mitigation inspection shows construction that withstands hurricanes.
Incentives for storm protective features, energy/green features, grant rewards to buyers and sellers who purchase quality upgrades.

Buyers show continuous confidence that the real estate market is at or very near the bottom. Fewer "for sale" signs dot our neighborhoods, and some are not sure if the signs floated away in the rains or properties have sold. I will vouch for the sold. The activity in sales contracts each month since February have continued to increase.

Brevard County is a very special place to call home. The concern for the homeless, the hungry and the poor, by all of our residents, reflects the sensitivity and the caring nature of the people who live here. Even the Loggerhead turtles search every shore in the world and choose here to lay their eggs and give us the pleasures of witnessing their hatching.

Appraisal can set a home's sale price.

2009-05-17T20:56:00.000-04:00

In this market, buyers cannot possibly overpay for a property if they are financing or the contract for sale and purchase is contingent upon the property appraising at contract price.
The beauty of purchasing in this "buyer perfect" market includes:

Interest rates under 5 percent.
An abundance of properties to choose from.
An $8,000 tax credit for first-time homebuyers.

Now buyers have the best protection possible: lenders in our area and in most of the United States are mandated to proceed with caution in the appraisal process. The appraisal is scrutinized in "underwriting," and appraisers are following procedures to select sales from the past six months that are comparable to the property being financed. Appraisals, therefore, are low, and lenders will not lend if the appraisal or value of the property is indicated to be less than the purchase price.

In addition to using sales within the past six months, appraisers must use a "depreciated market adjustment" for the months past the time of the sale. This adds to the lowering of the appraised value. What does this mean to the seller? The motivated seller must price his/her property at the appraised value.

Fair or not fair? In my opinion, this keeps the market from increasing in value. The fact is, there is nothing we can do about this until the abundance of properties are absorbed and the balance of supply and demand comes to the real estate market.

The possible solution or correction to this appraisal issue is obvious: Sell low and buy low. Use the market to your benefit. We cannot change the past, and now we have to live with the conservative lender practices. It seems to be a lateral move if you lose on the sale and gain on the purchase.

As our crystal clear skies come with the occasional threat of thunderstorms, so too this wonderful, very active market, has some black clouds. But the sun continues to shine on Brevard County.

Contract protects both sides...

2009-05-10T21:00:00.000-04:00

Sellers and buyers have rights under the terms of a home contract. The contract typically used for purchasing a property in Brevard County and most of Florida is called the "FAR/BAR Contract." It was developed and implemented with the Florida Association of Realtors and the Florida Bar Association. It appears to be a balanced contract for both buyers and sellers.
Certain addenda are usually attached to this contract giving the buyers the right to inspections and limiting the repairs of the sellers to a dollar figure that is agreeable to both parties.

In the addendum for inspections, the buyers typically have the right to cancel the contract and get a refund of all money deposited if the inspections are unsatisfactory in the opinion of the buyers. This condition for inspections and the right to cancel is for a limited time period, usually about 10 days from the date of signing the contract. Hiring a good inspector is essential in today's market. The inspector should notify the buyer if more inspections are necessary. For example, if there is an indication of past leaks and past moisture damage, a mold mildew inspection may be recommended.

Sellers should complete a "real property seller's disclosure" for the buyer's information. This disclosure will inform the buyers of past repairs and conditions of the property. Sellers must disclose items, not readily visible to the buyers, that would materially affect the value of the property. This is an obligation of the seller required by the contact and enforceable by the law.
Sellers can truly assist a buyer by providing additional information on what subcontractors were used for repairing air conditioners, electrical problems, pool problems and other maintenance or improvements on the property.

The buyers should be aware that an appraiser does not inspect a home for wiring, plumbing, heating, cooling, roof or appliances. The appraiser inspects the home for the size, condition, quality, age and location to determine the comparable sales and render the opinion of value for the bank in order for the buyers to secure the loan.

The surveyor has the duty of verifying the property lines and flagging any violation as to set backs and encroachments.

A title search is performed prior to closing to prove there are no claims or liens on the property that will not be corrected by paying off the mortgage, the taxes and any other existing liens.
The buying and selling process complex and these inspections and services provide assurance that the process is protective of both buyers and sellers.

The market continues to be extremely active as interest rates, although varied this week, continue to be low and the selection of available properties is outstanding. Smart buyers are taking advantage of this wonderful time in the real estate market in Brevard County.

Appraisals can make, break sale!

2009-05-03T21:06:00.000-04:00

Clear blue skies, spectacular sunsets, beaches, rivers brimming with life, art shows, music in the parks and soon, the Loggerhead turtles will seek the dunes to lay their eggs.
How wonderful life is in Brevard.

The real estate action is fantastic too, with far more activity than in the past year. Offers, counter-offers, short sales and foreclosures keep everything moving. However, there can be some trouble in paradise for those experiencing low appraisals. With lender restrictions, appraisers appear to be guided to lower their value indications and cast a conservative view on the market. What is an appraisal? An appraisal is an opinion of value rendered by one designated and licensed to perform this evaluation. The appraiser is typically hired by the lender when a buyer applies for a loan on a property.

The appraiser inspects the property, then studies the market for sales that are current and comparable to the property. In analyzing the information, the appraiser adjusts the recent sales that are comparable by dollar values placed on differences in age, condition, location, amenities, quality of construction and time of sale.

A market depreciation is used if the sale was not quite as recent as other sales. A depreciation factor is used to indicate that the market value has gone down since the sale of the comparable property. An appraisal is subjective and given as an opinion of value. The value indicates a range because the value is not a fact but an opinion. The opinion of value is determined to be what a typical buyer will pay for in today's market.

This appraisal is an integral part of the loan process. The appraisal can kill the purchase if the value does not meet the contract price of the property and financing is necessary. Most recently, there have been appraisals that come in lower than the contract price. How can the market recover if the past sales indicate a depressed market?

The only way to increase the market value of a neighborhood and the homes within is to have some cash sales or sales where the down payment is so significant that the appraisal does not negate the financing. The lender is not causing this problem as the lender is bound by problems and current restrictions on mortgage practices.

The appraiser is not the problem because he or she is at risk if the work is not performed in a conservative manner. If we can inch upward in our value indications and not put the lender or the buyer at risk, the slightly higher sales that have been killed by appraisals will allow for a slight change, which is a welcome relief in our real estate market.

Let's keep the action moving and enjoy the treasures of this beautiful place we call home.

Ready, set, buy a home...

2009-04-26T09:20:00.000-04:00

What are the steps necessary to purchase a home? The first step is to go to a lender and reveal your income and debts and apply for pre-approval. The next step is to look for a home. A good Realtor is a wonderful beginning to this process. Make sure this is someone who is knowledgeable and full time.

Location is the most important aspect of the property you are purchasing. Secure information on the Internet and learn the types of housing available within your budget. Do not base your choices on color of carpet or paint -- these are things that you can change. Base your decision on location and floor plan. Does this property suit your lifestyle? When you have selected the neighborhood, view every property in that neighborhood in your price range and investigate all of the active listings. Ask your Realtor to pull the sales, homes under contract and active listings from the Multiple Listing Service.

Understand the contract you are signing, and do not hesitate to ask the agent to explain this contract in detail. I would also suggest an "inspection addendum" that gives the buyer the right to cancel the contract and receive a return of deposits if the inspection of the property reveals a problem you cannot accept. After a contract has been negotiated to a meeting of the minds on price and terms, you should apply for your mortgage.

Next are the inspections. Hiring an inspector is an essential part of checking out a home.
Ask if there is anything that you, the buyer, should be concerned with now or in the near future. Ask the inspector if he thinks there is anything in the home that indicates a further inspection is necessary. In Florida, you should always have a termite inspection. If the inspection is acceptable and the items you want to be repaired are agreeable to the seller, you now go to the next step.

The mortgage company or lending institution will order an appraisal of the home to determine the opinion of value based on current comparable sales in the neighborhood. The appraisal may come in low. Appraisers are guided, in this timeframe, to be conservative. I disagree that the appraiser should be guided this way. I believe the appraisal should be accurate and based on current sales, not a forecast of doom and gloom for the future.

The market value will never recover if appraisals are mandated to eliminate any appreciation in the market. But I do not guide the appraisers and banks nor do I create the value. You should also do a final walkthrough of the home before you close. Take time to make sure that the closing costs, interest rate and amount due at closing are what you had expected. The market is great and the interest rates are low. There could not be a more perfect time to purchase, so feel good, you are now a part of the American dream.

Market continues to move.

2009-04-19T09:25:00.000-04:00

As the heat of the summer begins to approach, the sizzling activity of sales in Brevard County is the greatest in many months. Fueled by short sales and foreclosures and fired up by the lowest interest rates in years, the economic forecast indicates the light at the end of this tunnel is shining a little brighter on Brevard.

Existing lending institutions echo President Barack Obama's mandate "to help the homeowner."
Lenders are working with sellers in foreclosure, to recast loans, by lowering the interest rates, extending the foreclosure process or eliminating back payments. Communication with the lender, by the homeowner, is imperative. If the plan works, it could decrease the number of foreclosures and lead to a stabilization of the real estate market sooner than expected. By "sooner than expected," I mean stabilization will be seen in two years rather than three.

On the other hand, the delay in foreclosures may just mean that another wave will come at a later date than originally predicted. With the economy showing some signs of recovery, let us hope the foreclosures will be rescued by employment and budgeting by the homeowner in distress. Utilizing all of the counseling, refinancing and recasting offered by lenders, this type of homeowner has some alternatives rather than losing his home.

In some neighborhoods, the abundance of short sales and foreclosures has been eliminated, and buyers are finding they have missed the bottom-of-the-market bargains. Sellers, not in duress, are holding to somewhat higher prices and buyers will determine if they will purchase for the higher than short sale or foreclosure price or move on to another neighborhood. The future holds the answer to whether more short sales and foreclosures will appear or is this the corrective process of the real estate market?

Buyers may be frustrated at the change in a neighborhood from an abundance of short sales to none at all. The buyers must remember that even though they missed the short sale, the prices are still extremely low compared to the price to build. This, too, will change. New homes are being sold with no profit to the builder but the inventory and selection is growing smaller. There is still an oversupply and there are still great values, but the very best deals are disappearing.

The latest Housing Chartbook March 2009 economic forecast indicates the market may still drop slightly but next year's interest rates are predicted to increase slightly, therefore, negating any advantage for buyers to wait. Buying now at today's low prices, low interest rates and still with a good selection of inventory has buyers rushing to contract on existing homes.

Sell low, buy low the motto

2009-04-12T09:31:00.000-04:00

Some in this real estate market need to sell and some must sell. Here are some hints for those sellers who must sell:

If you are relocating to a new area, search the area to see if the market where you are headed is as soft as the market in Brevard County. Most likely, the prices in the area you are going to also are low -- or maybe even lower. The term "sell low, buy low" should be your motto. This could be your chance to purchase your dream home for a much lower interest rate. Sounds like a win-win situation.
If you are staying in Brevard County, you also win with the "sell low, buy low" motto.
Visit or call three lenders and check interest rates. Ask for a "pre-qualified" letter so, when you do sell, you have a good idea of what you can purchase.
Now for the tough part: placing your home on the market. Staging your home to sell is paramount in today's market. From curb appeal to every detail inside and outside of your property, your mission is to make it look perfect.

Step back from your house and look at the sidewalk, the yard, the flower beds, fencing and front entry porch. All should look clean, crisp and manicured. The front door should be freshly painted and sparkling clean. If you could imagine that the most important person in the world is coming to visit you at your home, how perfect would you want it to be? This is the standard that your house should reflect. This sterling presentation can lead to a quicker sale.

Inside your home, remove all clutter. The clutter could be a favorite collection or display, but it complicates the view the buyer sees of your home. Simplicity is key, and minimal furniture for maximum space presentation is your goal for home staging. Light, bright, open and airy are selling points of a Florida home. Any time that you can bring the outdoors in by opening windows and showing beautiful views, do it.

Pricing is more important than the way your home shows. Believe and understand that the buyer does not know, nor does he care, about the amount you need to sell for. The buyer most likely has experienced the same shock at pricing that you have experienced. The buyer is here to buy low because he sold low.

Why are we still thinking that we can sell for prices from 2005? We cannot. Get smart quick. Understand your market and believe that it has changed. Just hold on to the fact that you can gain by also buying in this market. The market is extremely active in a variety of price ranges. More activity is seen in the under $300,000 range. Great values can be purchased in the luxury housing market. The condominium market continues to render great buys with some moderate change in pricing. More activity in the next few months is predicted to continue as families begin to relocate over the summer months.

Selling low lets you buy low, too.

2009-04-06T21:53:00.002-04:00

Because it is a buyers' market, some feel that selling is not the right thing to do now. Not necessarily true. It all depends on what your plans are. The time can be right to sell if real estate is in a sell-low, buy-low market.

If you are moving locally, do it. Selling in the soft market and then buying in the soft market can work out in the long run. If you wait, say five years, for the market to become stronger, you may get more for your house, but you'll end up paying more too.

In other words, if you sell high and stay in the same area, you likely will have to buy high, too.
We would all like to sell high and buy low, but this doesn't work unless you plan to move from a high market to a low market -- much like people who moved from the Northeast did when they came to Florida years ago.

Here are the most important reasons to buy now:

Low interest rates: According to Freddie Mac, 30-year interest rates have hovered around 6 percent since the beginning of the year.
Portability of the Homestead exemption on your home's taxable value.
Wide selection: Nearly 300 homes are listed in Melbourne on the Multiple Listing Service this week.
Low prices.

Here are the most important things to remember if you are trying to sell now:

Price: Be realistic and price your home correctly. Stop dreaming about the high prices. They are long gone.
Condition: Make needed repairs, remove clutter and clean, clean, clean.
Availabilty: Be prepared to have your home shown at short notice. Do not postpone or re schedule any showings.

This is a great market for buyers and sellers to fulfill their dreams. It all depends on your perspective. Think about it. It can work to your advantage.

Programs provide assistance...

2009-04-05T15:36:00.000-04:00

The March wind must have pushed potential buyers to rethink any decision to postpone their purchase. The activity last month, although all statistics are not yet in, appears to have come close to doubling sales production from the preceding month. Wow!

Does this mean we are out of the downward economic spiral and beginning to spin toward that light at the end of the tunnel?

So many factors have created the advantage on the buy side. The lowest interest rates in many years, the abundance of selection available in the real estate market and the incredible values in prices. But the fact remains that many homeowners have over-financed their property. Homeowners, who have owned their home for many years, refinanced when property values were high and pulled the equity out of their home for use on other things. In addition, buyers in the high market times were given loans they could barely afford, and some of those loans had an escalation clause to increase the interest rates in the future.

Some sellers had placed a large equity line on their home to speculate and purchase more real estate as an investment. Even conservative homeowners with a small loan may have found themselves without a job or a decrease in pay, creating a financial hardship. Lenders, in the past, were eager to lend, and in some cases greedy to lend, and allowed homeowners income ratios to high levels of debt. When the economic conditions changed, income for many decreased. This created a devastating situation for the homeowner who over-financed. The result is the creation of the short sale and foreclosure market.

How do we help those homeowners faced with losing their homes?

President Barack Obama has created the HUD counseling hot line. Financial counseling is available by going online at financial stability.gov or calling 1-888-995-4673 Be prepared to have all of your financial information at hand. On the local level, Brevard County judges have created a plan to assist homeowners. The plan cannot and does not eliminate foreclosure, but offers the chance for the homeowner to mediate with the lender before final foreclosure proceedings. The Brevard County plan, created by the 18th Judicial Circuit Court, mandates communication/mediation between the lender and homeowner. The procedures for this plan are found by going to FLCourts18.org or calling 617-7238 for a mediation appointment. The cost is $250.

Market still has plenty to offer.

2009-03-29T15:46:00.000-04:00

Because home sales are starting to sizzle does not mean the prices are soaring. But the sun is still shining because home sale activity is the first sign of economic recovery. Prices never go up until the market becomes balanced. That is, the number of listings -- and the number of sales -- are consistently similar in a given time frame. But the next step must also occur. The volume of sales must top the number of listings to create a scarcity in the market. Scarcity creates demand and demand increases the market value of the property. More simply, there exists more buyers than sellers.

The reality of this active market is that prices are continuing to drop slightly. Sellers need to be educated that the market continues to have a substantial oversupply. Much of the oversupply are short sales or foreclosed property. Sellers need to be aware of short sales if their property is on the market competing against this type of listing. Short sales take many weeks and sometimes months to close.

Lenders who are working with sellers on short sales need considerable information from both the buyer and the seller. The seller must prove financial hardship, in most cases, to qualify for a lender-approved short sale. The buyer must be qualified and patient.

The seller still has control of the property and may or may not accept a contract presented. In some neighborhoods, there are few short sales or bank-owned properties. The values in these neighborhoods tend to hold and not decrease as in the neighborhoods with an abundance of short sale listings. If one or two homes in a large neighborhood are short sales, this may not decrease the market value of the neighborhood.

As the market stabilizes, the sales become more of an "arms-length" transaction. That is, the sellers are not under duress and values begin to hold. Short sales are usually placed under contract quickly and with multiple offers. There is a lengthy delay in closing due to the lender-required procedures. Buyers who are patient usually close with an excellent value. There are also many excellent values that are not short sales. Buyers are smart by buying now even if the prices dip slightly in the future. The interest rate is so low that it is highly unlikely that these conditions can continue.

If the rates increase, the buyer loses the advantage that he/she has in today's market. It is obvious with this type of sale activity that the selection of the best values in price, location and condition will soon be picked over. The time is right to buy.

Brevard a great place to call home.

2009-03-22T15:50:00.001-04:00

Spectacular launches at dusk remind us that astronauts are a part of this world and more. Hummingbirds bring our focus, not only to the beauty of those tiny colorful birds, but the abundance of tropical flowers that surround us. Calm river waters reflect the clear blue sky and give us a peek at the old horseshoe crabs, schools of mullet, graceful dolphins and colossal manatees. The rolling waves on Brevard County's beaches are speckled with our talented surfers, sandpipers, pelicans and mischievous seagulls.

Large, rare Loggerhead turtles select our shores to nurture their eggs until hatchlings are born to begin the cycle of life. Croaking frogs and wild herons awake us to the stunning beauty of nature that surrounds us. As the foreign birds flock to us, the British visitors are in a feeding frenzy over Brevard values. Even though the pound went down, the "down" of the pound is offset by the down in the prices.

First-time homebuyers swarm as $8,000 in incentives, low rates, (below 5 percent), and a great selection of inventory entice them to purchase now. The retirees can delight in the lower values as they purchase with limited dollars from the loss in their IRAs. Larger families wanting to upgrade, lose in the sale, but gain more in their purchase.

Find peace in the positives of nature, the true friendliness of our people and fabulous value in our real estate today. From my perception, what's not to love in Brevard County?

Short sales abound...

2009-03-15T16:02:00.000-04:00

What is this term "short sale" that everyone is talking about? A short sale is a sale of a property that is short of the mortgage balance owed. Normally, if one owed more on their home than the value or sale price, the seller would bring the difference of the balance owed to closing in addition to the closing costs.

Yes, some sellers have come to the closing table with a check in excess of $100,000 just to sell their property in a tough market. In this market, when a seller has negotiated with the lender an agreement to sell the property and have the lender take a loss on the mortgage, this is termed a short sale.

Typically, the homeowner has missed some payments on the mortgage. In addition, the homeowner is not financially capable of making continued payments and is risking losing the home to foreclosure. The short sale precludes the foreclosure and allows the seller to close before the seller loses the home. Yes, it is a loss for the seller and a loss for the lender.

The benefit, as I see it, is the fact that the bank or lender does not have to wait while the foreclosure proceedings are completed. The foreclosure procedure alone, can result in high attorney's fees, a considerable amount of time (sometimes more than one year), deterioration of the property and a loss which is usually greater than the loss incurred from a short sale.

The benefit to the homeowner is being rescued from foreclosure and the humility of such a procedure. The term short sale is so widely used and accepted it does not hold the same stigma as the term foreclosure. Yes, the owner suffers some embarrassment but in this economic state, but most of us are humbled simply by the fact that we have all lost in this economy.

Short sales are a sign of the times. The market is full of short sale listings. A good Realtor can give you a list of such properties. Do not think that all of these listings are the best buys on the market as many sellers, who have equity in their property (since they purchased their home many years ago) are willing to sell at today's short sale prices.

The best buys of short sale properties are being absorbed very rapidly in today's market. Short sale listings often bring multiple offers. In some cases, the agreed sale price is more than the price agreed to by the lender. The fact that there are multiple offers occasionally push the price of the property slightly higher. Get those great buys while you can, the market is sizzling with cash buyers.

Smart pricing saves the day.

2009-03-08T16:07:00.000-04:00

Buyers are here and are actively purchasing well-priced homes. People who are unrealistic about the state of the market and overprice their homes have a negative effect on the local market. The facts are sound.

If your property is overpriced, why keep it on the market? It does not have a chance of selling in a buyers' market. In fact, the overpriced property clogs the market with additional inventory. If you, as a seller, want to test the market, now is not the time. Market value is determined by the balance of supply and demand. An surplus leads to lower prices forced by such competition. A deficit leads to an increase in property values.

A unmotivated or unrealistic seller needs to withdraw his property from the market and wait, yes wait, until the market catches up to the expectations of this seller. In this way, the inventory will decrease and the process of market correction can be expedited. The premise that the first sign of economic recovery is in the real estate market indicates the need for sellers, who are "not" motivated, to eliminate this excess inventory and assist in economic recovery.

The real estate market continues to increase in activity and in the volume of sales. This type of activity is seen in this area and in many areas throughout the nation. If these sales continue for a long period of time, economic recovery is in the future. Optimism is a state of mind.

It is a conscious state and at this serious time, it is important we, not only think positively, but we act positively. If there is anything one can do to assist in economic recovery, it is these positive thoughts and positive actions.

It pays to invest in your house.

2009-03-01T16:11:00.000-05:00

The sprinklings of economic recovery are seen in today's real estate activity. Recently, I have received positive communication on the state of the activity in the real estate market. Again, the real estate market is believed to be the first indication of change in the economic situation.

We are far from increasing property values due to an oversupply of inventory. However, we are active, and the activity continues to increase. This is our positive sign of recovery for the near future. I would like to review some information given to me by Binki Kaiser, a local real estate expert, from the National Association of Home Builders Web site:

Statistics show that the median price of a house in 1996 was $140,000. Today, that same home would have gained more than $100,000 in value and in most cases locally, this property would have doubled in value.

In addition to looking at the return on this initial investment, the fact that the homeowner would have paid down a significant portion of the mortgage in the interim, creates even more net worth for the owner. The initial investment would typically have been 20 percent or roughly, $28,000. The value today of $280,000 with a $28,000 investment is an impressive return.

Homes tend to increase in value while the alternatives can be extremely volatile. Believing in private property rights and home ownership, in my opinion, is living the American dream. Repeatedly, I have stated that investing in one's home is one of the safest investments for long-term appreciation and security.

Words of wisdom in this market and in any market: Do not take the equity out of your home. Leaving the equity in your home is a wise and safe move for future planning. When selling your residence and purchasing a new home, transfer the equity of the home sold to the new purchase and do not be tempted to spend the wealth you have created in home equity.

This economic situation is teaching us the safe, conservative and secure method to handle real estate. The problems of the past and present teach us the conservative ways of the future.

Property starting to move.

2009-02-15T16:15:00.000-05:00

During the past month in a first look at statistics for 2009, the information available to me shows more listings coming on the market in January than in the month of December. However, this is very typical of the beginning of a new year when sellers evaluate their need to move in this market.

The average number of days for a listing to stay on the market is 107. This is an excellent sign the market is active and more listings are being priced realistically in today's real estate market. Commercial and income-producing properties are beginning to sell. More activity is reported in these areas than in the past month.

The most active price range is $300,000 to $500,000. In my opinion, this a good sign because in prior months this was one of the slower price ranges to move. There is considerable action in the less than $150,000 price range. It is reported that investors are looking and purchasing homes under $100,000 in all areas of Brevard County.

The most valued bargains in today's market are receiving multiple offers. We have not seen this type of action on certain listings since the heydays of 2004 and 2005. The difference is the values are so much lower than in the past years. Properties receiving multiple offers are properties that are definitely reflecting a great value in price, age, condition and location.

One of the most interesting statistics is the number of cash closings for the past one-month period. Cash closings far outweigh the number of sales being financed which, in my opinion, indicates that buyers may be liquidating their holdings in other areas to purchase real estate as a more secure investment.

Placing money in your home or second home typically is a safer place to have your investment as we witness the extreme volatility of the stock market. Some owner financing is apparent in the recent closings. This confirms that sellers can sometimes receive more of a return by holding a mortgage than placing their money in CDs at a lower rate of interest.

If you, as a seller, are thinking of holding a mortgage when selling your home, make sure that the mortgage is as safe as you can make it by requiring 20 percent down payment and excellent credit. This can save the buyer closing costs, eliminate the need for an appraisal and expedite the overall closing process.

The real estate market in Brevard County is sizzling with action. Remember if you are a seller and you want to sell and buy in this market, you have to give a deal to get a deal. Rates are low, inventory is in abundance, and programs and incentives are available for your place in the sun.

Buy now, it could pay off in future.

2009-02-08T16:20:00.000-05:00

It's hard to say no to purchasing real estate in Florida when the government offers $15,000 back to you in tax credits, the banks are offering the lowest interest rates in years and this is a buyer's market giving you the variety of choices in every style and price range. The icing on the cake for non-residents is to become a Florida resident and eliminate your state income tax along with the enjoyment of pleasant weather, blue skies and sparkling waterways.

All of these elements for purchasing may never line up like this again in your lifetime. I recently met an intelligent Floridian who claims to have created his own pension through his many real estate purchases in Brevard County. Granted, this man was a person of wealth, but his challenge, as is most everyone's challenge, is how to invest in a safe manner for retirement. He said he likes to "feel and touch" his investments so he has eliminated the purchase of stocks from his portfolio.

Owning and exchanging real estate has always worked for him in the past. He has now invested all of his holdings and purchased more than a dozen homes. These properties are rented with competitive rental prices and are professionally managed. He is able to depreciate these properties on his income tax each year and he uses the revenue for income or his pension.

On a smaller scale, many of us may be able to do the same, however, this is not something one can accomplish in a short period of time. This done, one purchase at a time, could be a lifetime goal for retirement. Safety measures must be used if real estate is an investment and used for rental purposes.

Meeting with a good accountant to review the advantages of Starker exchanges and the affordability of one's plan to purchase is only the first step. Consulting with a good Realtor on properties and rental rates, consulting with a good banker on mortgage interest rates and consulting with a good financial planner will give a beginner a good start for a great plan.

Don't let emotions ruin deal...

2009-02-01T16:23:00.000-05:00

There is a time to move, and a time not to move. A time to negotiate and a time to stop negotiating. Residential real estate is emotional -- it is our home, either the home we are selling or the home we are buying.

A home is about family, it's about relaxing -- it's a reflection of the pleasures of one's life as we decorate and create our own personal and charming place to find peace and happiness. It is about memories of times past or a look forward to future good times. This is why purchasing or selling one's home is so very emotional. As a counselor in residential sales, I hold up the red flag of caution when the negotiations become too emotional. Your emotions can cloud your thinking and negate the goal that you have been heading towards.

In today's market, make sure as a seller that you truly want to sell this home. You may only have one good chance. This is difficult, but a seller today must try to take the love that you have had for your home out of the transaction. Take the emotion out of the negotiation on price. If the price can be met with agreement and this price is within the market value range as indicated by past sales and current listings of similar properties, then take the offer.

Look at the bottom line and try to be unemotional. If you are getting what you need to move where you want to go, then, go for it. It is highly unlikely that you will get a price that is more than the value indicated by this market research. The fact is, if you as the seller will then be the buyer in this market, you are not losing. You are taking advantage of this market for you own benefit in your purchase of a new home. We call this sell low, buy low.

Do not let the closing date destroy your chance to buy or to sell the property. If the seller wants to sell and the buyer wants to buy, this is the time to compromise. Moving out of your house takes time and effort, but it can be done in 30-60 days. The shorter the time frame to close, the less likely problems will occur prior to closing. Buyers need to stay excited about the purchase and they need to own their new home in a reasonable period of time. Delayed closings can result in change of interest rate, change of family or job status or just simply a change in desire called buyer's remorse. Because selling and buying a home is emotional, keep the good and positive energy moving on this type of transaction and all parties will be happy at the closing table.

Obama brings hope to market

2009-01-25T21:19:00.001-05:00

When the thermometer dips to freezing, the snowbirds head South. Being a true native Floridian, when the temperature was expected to dip to freezing, I took the cue from my Northern friends and headed South -- to South America. To summertime, to long hot days, to sunsets at 8 p.m.

Meeting select Americans who serve our country at this southern tip of the world, I found their perspective of the United States insightful. Whether Democrat or Republican, the support of the new president, Barack Obama, is incredible. Views from outside the U.S. resonate the uplifting nature of a new beginning, a fresh start for the United States of America.

Positive in the economy, positive in housing, positive in the American dream. A woman in Montevideo, Uruguay, asked me, "You are an American?" When I nodded and smiled, she continued, " 'We' have a new president of the world. When the United States elects a president, he becomes the president of the world." How powerful, I thought, "president of the world."

Although we in Brevard County have not suffered as severely as the rest of our nation, as the temperatures dip to give us a taste of the cold, we have felt but a taste of the tough economy.
Soon the sun will warm us, the beaches and rivers will come alive with activity, sending a positive flurry to our housing market -- the basis of our economy. Interest rates are fluctuating at times lower than 5 percent.

We look forward, with hope, to the new president and an upswing in our economy. The world is watching.

Staging home can boost sale!

2009-01-18T20:44:00.001-05:00

The hottest market in real estate is under $100,000, followed by the under $200,000 price range for homes, townhouses and condominiums. So where do you go if you are a seller in another price range?

Investors and homebuyers who have time to wait are looking for properties that can be purchased for 15 percent to 20 percent under market value, and they are not looking for "fixer uppers." In fact, the typical buyer in the price range of $400,000 to $900,000 is looking for a property that shows like a model home. And they want all of the furniture, too. This is all negotiated in many sales in today's market.

Stage your home for selling. Here are some tips:

Exterior appeal from the curb, up the driveway and to the front door should be impeccable.
Flower beds should be mulched and weeded, plants trimmed and spruced up to lead buyers to the entrance.
Your front door should sparkle and shine with new, neutral paint, as should the exterior and interior of the property.
The first thing visitors should see as they enter is a light, airy and bright view of your home. This should capture the heart of the buyer, especially if he or she is from the North where the snow is still falling.
The carpet should be clean and possibly, just vacuumed. Be prepared to vacuum when you hear a potential buyer is coming for a look.
The smell of the home should be as fresh as the outdoors, not camouflaged by scented candles or plug- ins.
Showcase floor space by removing small area rugs. Consider storing some furniture and accessories to keep the look clean.
Kitchen counters shouldn't be bare, but consider hiding some small appliances, cookbooks, notepaper, pencil boxes and more to create a clean look -- one item per section of counter is a good rule of thumb. Likewise, get rid of dirty dishes and shine up faucets and sinks.
Bathrooms should be impeccable with shiny showers and tubs and closed toilet lids.
Owners and pets should exit the property before each showing.
Back porches and barbecue areas should offer seating and be surrounded by tropical plants offering visitors the image of outdoor entertaining to the fullest. After all, this is the Florida lifestyle.
Beds should be made, and bedrooms staged like a model home with lamps and nightstands that coordinate in colors that are soothing.
Utility rooms can show some signs of use but one should be able to view the storage areas and the versatility of the room. The same is true of the garage and closet areas. Just make sure that all are not too cluttered to detract from the use of the room.

Now that your home is staged, it may be necessary for you to camp in the nearest hotel because it is difficult to live this way. Competition is fierce, but buyers are out there in force.

Brevard numbers show an upswing

2009-01-11T20:31:00.003-05:00

Statistically speaking, real estate activity closed out 2008 on an up note.

The change in sold residential listings from November to December of 2008 indicates an increase in volume of 29 percent. From December of 2007 compared to December of 2008, residential sales volume increased by 13 percent.

These are the statistics from the Multiple Listing Service reports in Brevard County.
On all types of properties, the sales volume increased from November to December of 2008 by more than 18 percent.

The increase from December 2007 compared to December 2008 was more than a 6 percent increase in volume of sales.

The overall market comparing each and every month in 2007 to 2008 indicates that sales volume showed a decrease of less than 3 percent. The significant increase in activity came at the end of 2008 indicating positive signs for real estate in Brevard County in 2009.

Bottom line: Consider this an upswing in the market.

Where are the best buys? The average sale price in Brevard County for 2008 is in the $152,000 price range. This price range shows the most activity because there exists an oversupply, and one can purchase in the price range for approximately the same monthly payment as one can rent.

Let's look at the numbers.

A mortgage payment on a $150,000 home would compare favorably to a $1,000 a month lease.
Many buyer assistance programs are available to those who can qualify for the payments.
Please contact a local lender for a list of "down payment assistant programs" available to you.
Payments on 80 percent of the purchase price at 5.25 percent on a 30-year fixed rate mortgage are $663 per month. Adding in an estimated $210 per month for taxes and $150 per month for insurance, one can have a "tax benefit" and enjoy all the rights and privileges of "home ownership" for $1,023 per month. Please note that there are many, many properties available for under $100,000.

Residential homeowners who are looking to downsize in the future should look at buying now and renting out their newly purchased property until such time as their lifestyle indicates the need to downsize and move in to their investment property. Proceed with caution when purchasing property for rental purposes even if just for an interval time period.

One year's payments should be in your savings account along with a reserve for maintenance and repair. This is a protective measure for loss of rent, which could happen, in today's market.

Positive actions key to success.

2009-01-04T12:22:00.000-05:00

The book "The Secret" introduces the reader to the great power of "positive actions." This New Year of 2009 is the year for positive actions. We have been beaten down with the negative and it is time to gain strength from the positive. Every positive action receives a positive reaction. A simple smile gets a smile in return. Kind words are responded to with kind words.
Recent reports indicate that "recession survivors" may gain strength as weaker companies die off.

Smart businesses that diversify to withstand the economic challenges will become stronger. Space programs that have been faced with shortfalls in funding exhibit creative ideas to develop alternate programs to enhance their staying power. Slim state budgets offer opportunities for innovative ideas for funding sources. Businesses find their strength in positive attitudes of their employees filtering to exemplary service for survival.

I was speaking with a brilliant family business owner on New Year's Day and her comment was, "our company and this family is not buying into the bad economy concept. We have decided as a company and as a family to speak to the positives." This family has the "secret" and their company will not only survive but will thrive in this economy. Not just by thinking in a positive manner but by doing all of the positive actions to create the positive reactions of their customers to their products and services. And so it will be that the ones who perpetuate the positive will feel less of the effect than the ones that perpetuate the negative.

Brevard County has every reason to be positive. Travelers are snowed in -- literally trapped -- while we enjoy the beautiful calmness of the river, the spectacular sunrises over the ocean and the wildlife in our sanctuaries. How can we possibly experience the negative in this location? Our businesses are not only surviving but gaining in their strength. The word is out and continues to spread.

The great values in homes and condominiums in our sterling location call more buyers to commit to purchase in Brevard County. True, prices continue to drop but the properties continue to sell. The prime properties are moving at a rapid rate. To be more specific, those properties that are bargains in price and tops in location are the fast sellers. More sales each month than the month preceding and we move onward and upward, strengthening in our real estate base. We, Brevard County, are the best kept secret.

Finding a home for the holidays.

2008-12-28T12:30:00.000-05:00

You might think that real estate action lulls as people shop, handle holiday commitments and host visitors from near and far this time of year. The truth is that many buyers want to get settled in the New Year and start 2009 in a new home.

If you are a seller, consider that many buyers might be off from work this week and have plenty of time to visit for-sale properties -- maybe even yours. Be a smart seller. A smart seller will be prepared and accommodate each showing requested. The more people who visit, the more likely your home is to sell.

This is the time when families visit their Florida relatives and enjoy this beautiful weather, thus creating the desire to move South to our beautiful Brevard County. Local people shop real estate over the holidays and our northern friends think again that this may be the year to buy their dream home or condo in Florida . . . and it is.

With prices low, investment returns in the stock market volatile, interest rates low and a great deal of inventory from which to choose, there is no better time to buy. Think investment. Think about the returns on this long-term investment: condos on the ocean and river, townhomes and single family homes of every price range.

What more could a buyer ask for? Interest rates at a 27-year low are hard to pass up. Consider discussing with your financial planner your options on how to take advantage of these opportunities. Ask if real estate makes sense for you as a long-term investment in addition to a place to live. Conservative and comfortable is the only way to buy.

As I sit writing, I am visiting family in Washington D.C. Needless to say, I am freezing as I reflect on the Florida sun and the cool but comfortable winter breeze over the oceans and rivers.
Yes, it is nice to visit the busy city. It is exciting and tempting to stay, but me, I am a native Floridian and the call of Florida sunshine is always near even as I travel.

Consider benefits of Fla. residency.

2008-12-21T14:01:00.001-05:00

As the snow falls in the north and the winter winds begin to blow, the beautifully calm rivers of Brevard County this time of year often reflect the images of spectacular boats adorned with Christmas decorations. What community can boast nearly as many holiday boat parades as land parades?

Northerners migrate to our beautiful climate and calm waters to escape the weather in their home state. Many come just for the season, but many are swayed by our windows-open winters and stay much longer. And beyond the climate, there are other reasons to stay.

Take income taxes, for example.

Look at the benefits of buying here, establishing residence here and saving the income tax that was paid to the state that one came from. A great neighbor and friend related his positive experience on becoming a Florida resident but keeping his home in Rhode Island. Some states, for instance, have expensive state income taxes and laws that define residency as six months a year.

That may mean that one could live there for 5 1/2 months, establish residency in Florida and pay no state income tax. What a way to retire. All that money you save on state income tax up north could be applied to paying for your new home in Florida. My friend has discovered something very valuable in Florida residency.

Speak to a Florida accountant and verify the residency requirements in your state as compared to Florida. This may be an opportunity that you do not want to miss. While real estate is low, buying now may be the right move.

I urge each and every one of you who need help keeping your home to contact your legislators and give them the details of your plight. I am shocked by the stories of homeowners that need a counselor or a "real person" to speak to regarding escalating mortgages and homeowners who face foreclosure due to job loss or medical bills. If the bailout was only used to help the banks to survive and not the people, this is a sad state of the nation.

Options exist for struggling owners.

2008-12-14T14:06:00.000-05:00

We've been hearing a lot about foreclosures and short sales lately. A foreclosure takes place when the owner of a property stops making mortgage payments, and a bank or lending institution takes legal action to take ownership of the property. Those properties are frequently sold by the lender to recover a portion of the original investment. A short sale is when a lender allows a property to be sold for less than what is owed on the mortgage.

Both instances can devastate a homeowner's future and lenders' bottom lines, and both should be avoided if at all possible. Realtors can help walk buyers (and sellers) through the process on either side of the transactions. Before you let a foreclosure proceeding take your home, try to negotiate with your lender. Before you lose your property, communicate with the lender and possibly negotiate a short sale.

If you are capable of making lower payments, there is help for you and you may be able to keep your home. Right now, the cards are stacked in your favor if you are a homeowner facing foreclosure or a short sale. To receive the serious attention of your lender, you should be an owner occupant. Investor owners might not receive the same consideration.

If you are strapped with an excessively high interest rate, one that has escalated from an affordable rate to an unreasonable or unaffordable rate, you must get to your lender and plead your case for a lower rate or longer terms. Either way, you're looking for a lower payment.

In my opinion, you are the victim if you qualified for the loan at the teaser rate and then suffered when the rates adjusted upward. If I were in your shoes, I would make it my top priority to correct this injustice.

This is my suggestion: Call and speak with your former loan officer or equivalent person in the lending institution that holds your mortgage. Move up to the top supervisor if you don't make progress. Keep a good record in your calendar of who you spoke to and what help is offered. Keep moving up to the highest person with whom you can speak. Follow your conversation with a certified letter.

If you receive no encouragement or help, then it is time to talk to your elected representatives. Your local, state, and federal government representatives should be ready to listen and offer suggestions for help. Helping homeowners to keep their homes . . . isn't this what part of the "bailout" monies were designated for?

Starker exchange has some benefits.

2008-12-07T14:10:00.000-05:00

A recent article in FLORIDA TODAY highlighted the importance of happiness and its contagious nature. I believe the same is true with our attitude in this economy. Isn't it just as easy to believe in a positive future instead of a negative past or present?

This contagious epidemic of optimism could spread to the retail community, the new employees relocating to this area, the community leaders, our snow birds and each and every person living or visiting in Brevard County.

The facts are encouraging.

Brazilian jet maker Embraer is set to take off with the promise of 200 new positions, threads of possibilities for enhanced scientific research in space exploration are appearing daily, giving hope for the continued employment at Kennedy Space Center.

The optimism is perpetuated as the activity in real estate continues to emphasize fewer listings coming on the market and the volume of sales continuing to increase. Long-time investors are seeking more in the way of capitalizing on this market: that is "sell low, buy low." The long-time investor who has real estate holdings that have been depreciated for tax benefits are selling through what is called the "1031 exchange" method. The 1031 or Starker Exchange provides for buying replacement properties to enhance the tax-deferred purchase.

The investor should verify with their accountant that the depreciation process can now begin again. The wise investor meets with a good accountant and creates a plan to enhance wealth through government sanctioned write-offs. A 1031 allows a seller of like/kind investment property to defer taxes on the gain after the sale, if very specific rules are followed. One can then, purchase similar properties while an intermediary holds the funds from the first sale prior to the reinvestment in the next purchase.

An experienced Realtor can assist and direct the investor to the proper closing agent/attorney for procedural requirements to assure the investor of the 1031 exchange as allowed by the government.

New investors entering this market should be conservative in their investment purchases. New investors should be well advised as to the pros and cons of their investment. The tax benefits are great for those who can afford this purchase. Let the optimism continue as we all look at the positive sides of this very different economy. Smart people look at the benefits.

Paying cash has its perks.

2008-11-30T09:19:00.001-05:00

A new president . . . new programs for homeowners in trouble . . . clear, crisp and cool weather . . .

Let's be optimistic. We have reason to be.

New companies are building corporate headquarters on the Space Coast, new cruise ships are under construction and bound for Brevard County, and a standalone convention center is expected to open early next year at Port Canaveral.

The economy in Brevard County, although affected by the recession, is a pocket of fresh air when we look at other locations around the nation. This is not to minimize the fact that we all are still tightening our belts, unemployment is up and we all are feeling the hit of this significant economic downturn.

Still, we must count our blessings. As the snow begins to fall in the North, the real estate market begins to pick up in the South. Our snowbirds entertain thoughts of settling into Brevard County. Condominium prices are the lowest in many years. This market is tempting our seasonal residents to purchase instead of renting. And this is an intelligent decision for our Northerners. While the stock market continues to be volatile, the real estate market continues to show the signs of stabilizing.

Prices are not going up and will not for some time, however, the stability and consistency is shown in the increased activity each and every month in the volume of sales. The hot deals will not be here forever. Listing inventory continues to shrink and market activity continues to increase. Programs for easier financing are beginning to become available but many buyers are opting to pay cash for their purchase.

Cash from savings or liquidation of retirement funds are freeing up buyers to an easy purchase in this buyer's market. A clever alternative and a safer alternative, is the purchase of real estate as a home or investment property. For negotiations, cash buyers continue to have the leverage in today's market.

Where else can one purchase a home in the $60,000 to $100,000 range? Where else can one find an oceanfront condo for under $350,000? Brevard County is one of the most affordable areas for real estate. Combine this with the quality of life in our beautiful county. Meandering waterways, clean beaches, breathable clear air and wonderful friendly people, offer relocating families, the "best" of life.

Retire on real estate?

2008-11-23T09:25:00.000-05:00

We are witnessing the "plunge" of the stock market. We have already witnessed the "plunge" of the real estate market. Where do we go from here?

The real estate market is reported to have "bottomed out" or is close, anyway. No one has a crystal ball that can assure us that this is true. Past cycles and current statistics all indicate that the real estate market is forecast to rise in the future. Current and consistent increased activity in sales indicate that this is true.

Real estate, for investment purposes, is a long term commitment. Now that we have weathered the worst stage of the real estate market, it would be logical to assume that real estate would now be a wise investment.

The stock market looks riskier these days.

For those of us close to retirement, we cannot accept this risk. Can we cautiously withdraw this retirement money and, with the expert advice of a financial counselor, invest our IRA in real estate? With the real estate market at a low and predicted to begin to increase over the next three to five years, this might be the time to purchase retirement property without selling our current home.

We buy the retirement property in a low market and wait to sell our current residence over the next three to five years and predictably, obtain an increase in the current residence. We will have capitalized on the current low market and we win on both ends.

The best bargains in real estate are still available in the condominium market. Current statistics and past stagnation in the vacant land sales indicate that this area, too, offers some good values. Cash buyers, using their retirement portfolios, have a tremendous edge in negotiations in this real estate market.

Cash offers are typically lower than offers with a mortgage contingency but these offers have an extremely high possibility of closing, whereas the offer with a mortgage contingency still has to have bank approval with excellent credit from the borrower along with validation of income and a current appraisal at or above contract price.

The key to buying in today's market is still "location, location, location"! As the snow begins to fall in the Northern states, oceanfront and riverfront condominiums here in Florida consistently attract buyers. This is a terrific time to switch your investments to real estate.

Be cautious, be careful and work with a professional.

It's up to us to help.

2008-11-16T09:28:00.000-05:00

Two important issues can assist many in today's economy. Two important issues can assist home buyers and home sellers.

The first issue is that of overpriced properties on the market.

A story late last week in FLORIDA TODAY headlined "Realty's Reality hits home" really stuck me as serious.

I have always given sellers, when I am representing them, the opportunity to begin a listing with a higher price than I have recommended. I tell them the truth, as I see the market, but I want to give the seller the benefit of the doubt on price because reducing a price is much easier than raising it. Realtors give an opinion of value, but we always hope that the home will sell for that which the seller wants so that the seller is happy.

On the other hand, when working with a buyer, we want the best deal possible so the buyer is happy. In spite of its beauty, extras, condition and original price, the home must be priced sensibly. Let's all stop dreaming and get to the truth in this market. Let's reduce the overpriced properties.

The second issue is truly paramount in Florida and throughout the United States. This issue is the "The new home-loan aid." As I read and study this plan, I am astounded at how few people will be helped.

How can we say that we are assisting homeowners in trouble with mortgages they cannot pay if fewer than 2 percent of the troubled homeowners will be helped? Yes, according to my interpretation, government officials "had no estimate of how many homeowners would qualify but these are their guidelines:

--- borrowers would have to be at least three months behind on their home loans.

--- borrowers would have to owe 90 percent or more of their homes' values.

--- Investors are excluded.

--- borrowers who have filed for bankruptcy are excluded.

Qualified borrowers would get an interest-rate reduction so the borrower would not pay more than 38% of their gross income. Loans could be extended to 40 years, and some principal could be deferred interest free. This is a very weak. Is there a better way?

The first step if you are in trouble or going into trouble: Ask your lender for a rate reduction, an extended plan for payment, forgiveness for one or two payments. Do not stop asking.

The National Association of Realtors is recommending that the $7,500 first-time homebuyer tax credit be made available to all buyers and eliminate repayment. NAR also recommends "Getting the Treasury relief program back on track and targeting more funds to mortgage relief."

If you agree, call and write your legislators to become involved and back programs that help many people, not just a small percentage of those in trouble.

Rental investing is back.

2008-11-09T09:33:00.000-05:00

A new president will bring a new market . . . change fosters change.

Speaking with several appraisers this past week, the biggest change in the real estate market may indicate that investment in rental properties may begin to be cost-effective. For so long, the purchase price, amount financed and the cash flow on rental income could not justify an investment purchase of rental property.

Now we are close: Investors may be able to break even buying a property with a 25 percent to 30 percent down payment, financing the balance at the current low interest rates and renting at a competitive rate. This is a sign that more investors, conservative investors, may begin to enter the market.

Investors in today's market are conservative and financially sound. Many people are pulling out of the stock market and looking at real estate as the diversification needed in their portfolio. If you are just beginning to look at real estate as an investment, some guidelines for landlords are necessary.

--- Conservative should be the key word. "Cautious and careful" should be the investor motto.

--- Select a property for its location as land appreciates and buildings depreciate. Scarcity creates demand and demand brings a higher chance of future market appreciation. The property you select should be rentable.

In keeping with a conservative approach, an investor should buy properties that he or she can afford to have vacant for at least one year.

--- Properties that are in an excellent location with a good floor plan, freshly painted in neutral colors, and meticulous in condition and cleanliness will rent well and within a reasonable period of time.

--- The rent you receive is second to the quality of your tenant. That is, having a tenant who pays the rent on time and maintains the property should be a priority for an investor. Not all good tenants have excellent credit, but a good tenant can honestly justify a credit problem caused by health issues or job loss.

--- Long-term tenants bring consistent income. Tenants who report problems with the property are helpful to a landlord who takes pride in his/her property.

--- Maintaining your investment in rental property will bring a return when you sell. A real estate investor should look at the investment as long term.

In my opinion, a five-year minimum on holding the investment property is necessary for the return on the investment. Tax advantages are still a part of being a landlord. Your accountant can review with you the depreciation and appropriate write-offs on your taxes. A 1031 or Starker exchange are still viable alternatives when selling in the future and deferring taxes on the return of your investment. A good Realtor can assist you with the guidelines.

Brevard a bright spot in economy.

2008-11-02T10:04:00.000-05:00

People across the nation have lost their homes and many have lost their jobs. The stock market has shown unprecedented volatility that will leave its mark in the history books. Real estate has dropped to its lowest point in years. The year 2008 is negative in most respects.

Yes, we have tightened our belts, learning to conserve where we can. We have prepared our children and grandchildren for the need to spend less and save more. Some of us have had to acclimate to substantial losses in our retirement portfolios.

We look conservatively at future purchases. We have watched as many have struggled to keep their homes and we have waited for the banks to begin positive communication to assist our neighbors.

In Brevard County, in these respects, we are not so different than the rest of the communities in our country that are struggling and attempting to tackle the same problems. Help for those in need is beginning to emerge. Banks are communicating and assisting those homeowners to find ways to save their homes from foreclosure or short sales. The federal government is lowering rates again to help spur the economy. Programs are available for qualified buyers to purchase in today's market. The stock market is still volatile but showing a glimmer of positive signs. The price of gas is going down each day.

Specifically speaking, in Brevard County, we are more fortunate than the rest of the United States and even more fortunate than surrounding counties. We can still boast that we have "affordable housing." Offering a wide variety of types of housing is still luring people to our area. Oceanfront and riverfront condominiums and townhouses are available at reasonable prices. Golf course homes, large country lots, cottages and castles . . . simply spectacular, this place we call home.

Our large businesses are showing positive results of their soon to be year-end numbers. Our housing industry is showing continued increase in the volume of sales.

The weather is beautiful, the grass is green. We will retain our clean beaches and rivers . . . we will continue to see spectacular sunsets amidst the clear clean air and Brevard will march onward and upwards to a better standard of life and with more awareness of how life changes in minutes so we must treasure this life.

We have come full circle in prices of housing in our county and now is the most perfect time to buy.

Homes taking less time to sell.

2008-10-26T10:08:00.000-04:00

Interesting statistics for the past three months in Brevard County still indicate that fewer properties are coming on the market, but the amount of new listings is exceeding the sales slightly. The positive mark is the continued increase in properties coming under contract, that is to say, properties that are approaching closing. We in the business call these "pending" or "contingent" sales.

The number of days on the market has been significantly reduced over this past year and now stands at 122 days. This would indicate that a well-priced property should sell within three to four months. If your property has been on the market for more than three or four months, you need to re-evaluate the following: Price, curb appeal, cleanliness and its overall showability. If your house is priced right and shows well and still hasn't sold, you should find out if something in your area is affecting your property or is it getting the proper exposure to buyers.

Among the factors that can slow a sale are:

--- Floor plan that doesn't appeal to a wide range of buyers.

--- Location considerations, such as traffic or nearby undesirable businesses.

--- Neighborhood considerations, such as a nearby property that isn't maintained.

Often, the only solution is a price adjustment, even though that's not what most sellers want to hear. But if you are motivated to sell, a price adjustment will most likely assist in moving the property. I was asked to supply statistics on sold properties that were foreclosures or short sales and at this point, I am unable to access and rely on the information I have for these types of properties.

I do have some advice if you, as the seller, are debating whether to enter into a sale of your property via foreclosure or short sale. These are desperate measures that will affect you for years to come.

If you have equity, just continue to reduce the property for a quick sale. If you have no equity, this is the time to talk to your lender. Programs are coming on line and lenders are prompted by the government to listen. There is still no guaranteed assistance available but I advise you to hang in there.

Help is inevitable with the economic crisis and the push to assist owners in need. Brevard County is still high on the economic curve. Government contracts are still in force and fueling our economy. Our chambers of commerce and Economic Development Council are actively recruiting new businesses into our area. We have a great deal to offer families relocating here and a tremendous benefit to businesses moving into our area.

Stocks, homes seesaw...

2008-10-19T10:12:00.000-04:00

Someone once told me that real estate and the stock market were much like a seesaw. When the stock market goes down, real estate goes up and vice versa. There is still too much inventory and not enough buyers in this real estate market to allow for price increases.

We do not qualify as a county or a state with a shortage of available real estate, but the fact is, there continues to be an increase in the volume of sales of existing homes and fewer homes are coming on the market each month. So the supply is dwindling due to fewer homes coming on the market each month combined with the increase in the number of homes closing.

Therefore, the dynamics of the seesaw effect are in a way, working to the benefit of the real estate market!

It is still imperative that if you are a seller, you must price your home correctly and market it properly, in order to sell in today's market. If you are a buyer, it is imperative that you secure preliminary loan approval before contracting on your home purchase. The buyer has a great selection to choose from and a great interest rate can be secured from lenders.

Homeowners facing foreclosure or short sales, hopefully, will see light at the end of this dark and gloomy economic tunnel as the government enacts programs of assistance with lenders to lower rates or payments to rescue those who have fallen behind in payments. This is the time for homeowners in trouble to communicate with their lenders and stay abreast of programs soon to be available for homeowner assistance.

Lenders are strict for new loans. The "jumbo" loan programs are often requiring more than 20 percent down payment. For loans higher than $2 million, lenders are offering 75 percent financing and a five-year fixed rate amortized for 30 years but adjusting or ballooning at the end of five years. The conservative changes in this luxury home market show that lenders are not willing to keep a large loan (over $2 million) for a 30 year fixed rate in their portfolio of loans. The conforming loans with 20 percent down require excellent credit and verification of job stability.

Still the FHA and VA loans continue to be the most popular in the state of Florida with minimal or "no" down payment. Motivated sellers are will to pay buyer's closing costs to secure this type of financing.

The problems in the economy have some silver linings -- not a lot of silver but a glimmer of hope for the future!

It's time for us to tighten our belts.

2008-10-12T10:15:00.000-04:00

Home sales are increasing in activity, in spite of the downturn for the economy. Home ownership truly is the American dream. You might have ridden the wave of property inflation and found that today's prices are back to normal or even more affordable than that -- affordable both in price and in mortgage terms.

Interest rates are low and may be dropping slightly lower. Buying power is at a high with wonderful values surrounding us. Placing most of your life's savings into your home is a safe bet for long-term appreciation. Real estate should not be thought of as a fast turnover market. It is a market that is typically slow to change. Appreciation may not be rapid but it most likely will be safe and consistent.

This is the kind of market in which our parents felt safe placing their hard-earned money into as a home down payment. This is the kind of market where one would like to pay off their home and feel comfortable with our economy. Our economic state these days does not lend itself to comfort. Most of us have lost value in our market-based retirement accounts this past week.

But think about this . . . what if you owned your home free and clear?

This may be the time to plan to be conservative -- conservative in your purchase of a home and conservative in the payment of your mortgage. It was not long ago when I was advising my clients to make one extra mortgage payment each year directly to principal reduction and look at paying off the 30-year mortgage in approximately 18 years. Let's go back to being conservative. Not just because we want to do this but now we must do this.

Educational programs on TV and the Internet are assisting in ways to economize. Sometimes we must listen to this direction, tighten our belts and move forward in a conservative and cautious manner, such as purchasing an affordable home using 25 percent of your income for your mortgage payment.

Using 33 percent of your income for total debts is the conservative way to look at purchasing in today's economy. In this way, one can still save money and enjoy life without the stress of payments that are too big for your comfort zone.

Placing one extra payment towards your principal balance is a method of "forced savings" in a solid and conservative manner. Forcing oneself to save before spending is another cautious and conservative method of budgeting in this tough economy.

Passing up the latte, conserving on energy usage and purchasing needs instead of wants will get us into a more comfortable world.

Credit market where it should be.

2008-10-05T10:18:00.000-04:00

How is the credit crunch affecting the real estate market? Can you sell a house now with everything going on in the U.S. economy? Can you buy a house now with this unbelievable economic crisis?

The answer is yes. Homes are selling, and buyers are getting financing. Florida had the highest rate of FHA mortgages recently in the United States. Home loans are available. The clock has now turned back to the way things should be . . . that is, those people who have good credit and verifiable income can secure financing to purchase a home.

Those people who have decided to "short sale" or go into foreclosure have now made a choice that they have to live with. Those who made the choice to sell short or foreclose will not be able to secure mortgages again for many years. Each circumstance for foreclosure and short sales is different, but the lending institutions will now make decisions not to lend to these people regardless of circumstances.

Veterans can secure VA financing with no money down. FHA buyers can purchase with 3 percent or less down. Conventional financing is available for those who can afford a down payment and finance 80 percent loans. Money is available. Credit is available. All are available to those who can afford to purchase and to those who can afford the payments.

This is not a bad change in the market. This is the way the real estate and lending market should be. We all need to tighten our belts and think before we purchase. We need to make certain that we can afford to pay back the money that we borrow.

There is no more incredible leverage -- based on rocketing home values -- available to the consumer. The rules have changed but the good news is that we can purchase a home, we just must be able to "afford" that purchase. Homes are the most affordable than they have been in many, many years. Interest rates are low and reasonable. There is an abundance of properties to from which to choose.

In spite of what you are reading in the newspaper and in spite of what you are seeing on television, real estate is alive and well in Brevard County, in Florida and throughout the United States. This is the time to buy the American Dream.

Owning a home still the dream.

2008-09-28T10:21:00.000-04:00

Lately, I've been asking young people what they want to know about real estate. Many inexperienced buyers reply with a fundamental answer: How do we buy a home?

I tell them the first stage should always be to apply for a mortgage.

Yes, before any home is selected, the buyer must know how much of a mortgage he or she can afford. Knowing your credit score is very important. You, as a buyer, may otherwise qualify for a large mortgage but cannot secure one with nice low payments because of late payments on some of your credit cards and other bills.

When you apply for a mortgage, you will learn your credit score. A good, local loan officer will assist you in ways to address "fixable" issues. After buyers qualify for a mortgage, they can begin to look for homes that match their proposed payments.

Find an agent who you know is respectable, knowledgeable and honest. Sit with this agent and show the agent your letter of qualification from the lender. You are not bound to this lender nor are you bound to this agent. You may want to meet with several loan officers and several agents to determine who fits with your personality and your needs.

When you find an agent, secure a list of homes that meet your needs in location, price and floor plan. A good agent can research the status of houses that interest you. That is, information on what the seller paid for the house and when the property was purchased. This information will come in handy when you begin negotiations. Knowing the motivation of the seller is very important, in addition to knowing how this property has been maintained over the years.

Important points to understand when purchasing are the following:

--- Understand the total payment. Principal and interest are determined by the lender. In addition, buyers need to secure insurance on the property and you, the buyer, can shop rates to determine the best price and coverage. Your real estate agent can assist with this but the ultimate responsibility is on the buyer.

--- Taxes will change in the next year after the buyer's closing date. Buyers inherit the seller's taxes until Dec. 31. The following Jan. 1, a new tax rate will affect the property, but the actual tax bill will not be known until Nov. 1. Buyers can find estimated taxes through the Brevard County Appraisers Web site.

Homeownership is the American dream. In spite of all the problems in our economy today, owning a piece of America is still very possible.

Follow steps to buy...

2008-09-21T10:24:00.000-04:00

Too many times, buyers are looking to find exactly the house that appeals to the taste and decor they like. It has been said over and over again . . .Location . . . location . . . location is the most important aspect of a real estate purchase!

If you are looking for a home, the procedure is simple.

First, find the general location you like. Once the general location is discovered, concentrate on neighborhoods and search for one that appeals to you in price, location and appearance. Drive this neighborhood in the morning, the evening and at night. View the homes within and surrounding this area for curb appeal. Neighborhoods that are well kept tend to hold their value.

Listen for noise from trains, planes, factories etc. Sometimes, these nuisances do not show up except at certain times of the day. Boats and cars parked on the road and off to the side of home begin to "downgrade" the neighborhood unless the lots are big enough to hide these things away from the house. When you are convinced by driving the area that this is the neighborhood for you, then the fun begins!

Tour each and every house that is on the market in this area.
Find a floorplan that suits you and your lifestyle.
Try to avoid the distractions of fixable cosmetic features, such as paint, wallpaper, and carpet.
Floorplans are difficult to change and location, of course, is impossible to change.
Do not focus on furniture that is in the home but consider the size of the furniture to picture your own items in the house. Study the plan and know what you can or cannot live with.
Pick your three favorites homes and ask your agent to do a market analysis of comparable homes nearby that have sold, that are under contract and are actively listed.

You too, can research on the Internet but do make a point of having a professional give you their opinion. When you study the market, it is then that you will see some consistency in the value.

The next step is making an offer. Do not insult the seller but ensure your agent can support the offer with evidence of nearby sales. Have your agent show the seller or seller's agent the competition and let him or her know that you have other options. If you do not get your favorite for a price you feel is fair, then go to your second choice and keep going until you are happy with the house and the price. Once closed, this house becomes your home.

Check your local lenders for new "down payment assistance programs" that have just been made available.

Buy now, save in interest

2008-09-14T10:28:00.000-04:00

Fewer listings are coming on the market each month. Sales, even though low, are increasing each month. There still is a great deal of inventory in Brevard County, but if buyers wait too long to move forward, the price might be a good one, but it will cost more.

Let me explain.

Binki Kaiser, a renowned real estate expert, states that 94 percent of buyers in today's market find their homes on the Internet, investigate the neighborhoods, then make appointments with their agents. Today's buyer is particular, knowledgeable and striving for a good deal.

The buyers of today weigh renting a home vs. purchasing a home. They look at the low price of rentals and are enticed by the property they could rent. Today's buyer may be taking too long to make a decision, Kaiser says.

Mortgage rates just dropped. The rate will undoubtedly increase again soon. The struggle for the buyer is to get the best price. If he or she waits too long and the interest rate increases, it will cost this buyer more money, in the long term.

Using a 6.5 percent interest rate and a $325,000 mortgage, this example is "principle and interest" only. Taxes and insurance costs vary according to the home being purchased.

A 30-year mortgage with a 6.5 percent interest rate will cost the buyer an estimated $2,054 per month.

If the buyer waits and then decides to purchase the same home with the same term, but a 7.5 percent rate, this same $325,000 mortgage will cost the buyer an estimated $2,272 per month. The difference is $218 per month.

The buying power of the 6.5 percent interest rate vs. the 7.5 percent interest rate is best viewed as paying $34,500 more for the home if he or she waits and the interest rates jump back to 7.5 percent. That is, if the interest rate stays at 6.5 percent, one can finance $34,500 more, possibly roll the price of a new pool into the loan, and have the same payment as the 7.5 percent mortgage in the original amount of $325,000.

This is what cost vs. price entails.

To review this difference over 30 years, using the same mortgage amount of $325,000, the home with the 6.5 percent mortgage is paid out over the life of the loan in an amount estimated at $739,440. The 7.5 percent mortgage paid over 30 years totals an estimated $817,920. Now, the cost of this home is more than $78,480.

Buyers in today's market not only need to look at mortgage rates and low real estate prices but buyers need to understand the added advantage of buying over renting.

The government rewards us with tax deductions on mortgage interest and real estate taxes. One must review the vulnerability of rental rates increasing year to year versus the write-offs on income tax.

Buyers in this market have a great deal of investigating to do and if they are smart buyers, they will do it.

Storm- ready homes a plus.

2008-09-07T10:32:00.001-04:00

As the rains continue to fall, I am grateful for the renovations and enhanced construction implemented after the hurricanes of 2004. Windows are sealed, and if you do not have shutters, then hopefully you have impact-resistant windows or great plywood. Sandbags are available and should be placed where necessary. Follow the forecast, and stay safe and dry.

The real estate market marches on, even during the rains. The weather has changed the value of improvements that bring returns in today's real estate market.

Hurricane shutters expedite the sale of a home. Electrically operated or luxury shutters do not bring a financial return to sellers but certainly enhance the appeal of the property and bring some return in a quicker sale.

A newer roof with hurricane straps is almost a requirement in the sale of a home during the hurricane season.

Any other preventative/protective measures for hurricanes should be highlighted and brought to the attention of prospective buyers.

Upgraded wiring to accommodate a generator becomes a plus in selling, even more so if the generator comes with the house and is included in the sale price.

A gas grill in the summer kitchen is a good feature in case of power failures. It is interesting how the buyer's priorities change during the hurricane season.

This is the time that agents and sellers need to be particularly calm but thorough in relating hurricane information and past experiences.

A seller must disclose problems that he or she has encountered in the past, relative to the property. In the seller disclosure that is typically given to the buyer, sellers should explain exactly what problems were experienced in past storms and how the problems in the past were corrected.

It is important to explain all details of the property before the buyer has an inspection. Inspectors are thorough and tend to find indications of past leaks. When a buyer has been informed of everything prior to inspections, the seller's credibility is increased and there is trust with buyer and seller to complete the transaction.

Current statistics show that the hurricane season has not affected the trend of increased sales in the past few months. Our particular area of Florida has seen a correction in fewer listings coming on the market in addition to the increased sale activity.

With this information, if sales continue in the same pace and listings continue to decrease, the residential market, in my opinion, will begin to balance in approximately one year.

Closing can be a big deal.

2008-08-31T10:37:00.000-04:00

Buying or selling a home involves establishing a relationship.

If you are the buyer, you are in control but only to the degree of your contract. I have been involved in contract negotiations that take weeks to resolve with a true meeting of the minds. But even the toughest negotiations can result in smooth transactions.

Negotiations are not just about price, yet price is the most important aspect for both parties. Buyers may ask that the seller assist with closing costs. Buyers may ask for an earlier closing date because of issues with mortgage interest rates and lock-in requirements. As a result, the final price can hinge on closing date. Communication is the key to creating a good relationship throughout the transaction.

The buyer has the right to inspections to determine if the home is in the condition expected. An inspector is hired by the buyer, and this inspector spends many hours in the seller's home. Uncomfortable as it is, this is truly a protective measure for both buyer and seller. The buyer typically has the right to cancel the contract if the condition of the property is not acceptable.

Often buyers get bogged down with numerous insignificant items rather than the true picture of the overall condition of the property. Roofing, electrical and plumbing systems, air conditioning and heating systems are critical.

Many other issues -- such as tree limbs close to the home and minor caulking -- are maintenance items that buyers can expect to deal with throughout the time they own the home.

Buying a house is very different than purchasing an appliance or another item that does not carry the same emotion. It's like buying a car from a private owner, rather than a dealer. If the buyer values the seller's "pride of ownership," the transaction can proceed smoothly. When a buyer boasts of all the changes he or she will make to the home, some emotions may arise from the seller that can affect the ease of the transaction.

The bottom line is, if sellers and buyers appreciate each others' viewpoint, and the struggles that go along with buying, selling and moving entire households, the transaction can be a pleasant one for all.

When sellers and buyers have proceeded through all the stages of the purchase and a good relationship has been established, sellers will leave information that is not required but very helpful for the buyer. Paint, extra keys, names of neighbors, warranty books, repairmen and other great information can ease the process for a buyer and make the move a good one.

A buyer and seller may not even meet each other until the closing, but the relationship was established throughout the transaction in the manner in which each party deals with the unexpected changes.

Relationships . . . try for the best when buying a home.

Use bad weather to your benefit

2008-08-24T10:40:00.001-04:00

Brevard County has never seen so much rain in such a short period of time. Few places have.

Florida will always have sunshine, but when the rains come, it is possible for homebuyers to use bad weather to their advantage.

If you, as a buyer, really like a home when it is cloudy and rainy, just imagine your opinion of the property when the sun shines brightly. When it is raining, a buyer can determine where gutters are needed on the home. A buyer can see how high the home is built up for proper drainage. The topography of the land becomes more apparent after a storm.

Typically, oceanfront and dunes are the higher areas above sea level. The land then slopes towards the river, which is the lowest point, or sea level. A good flood map can show a buyer the various levels throughout Brevard County.

As a buyer, one may have a tendency to shy away from a flood zone but most important, consider the planned drainage of the community and the actual height of the improved property. Florida is largely built on soil that accepts rainwater, unlike clay soils that are found farther north.

Coquina rock is the base of much of South Tropical Trail. It too, is porous and allows for drainage. This is incredibly fertile, allowing for beautiful mango, avocado and citrus trees along with magnificent flowering Royal Poinciana and Tababulia. Drainage is quick in most of these areas until it reaches the saturation point.

We have learned a great deal from the hurricanes of 2004 in regards to "water intrusion" and methods of eliminating mold and mildew.

Sellers have access to all types of companies and equipment designed to repair leakage and restore their homes and properties to a "better-than-new" condition. Frequently, the question is not whether leaks will come after a prolonged rain, it's a question of how much, where and what will the seller do to repair the problem.

We have just had the best test of waterproofing a home.

Buyers should use this time, to investigate flood insurance, check out their future neighborhood and move forward on the purchase of your new home.

Sellers, this is your time to make your property shine even if you have been soaked to the bone.

Brevard a great place to live!

2008-08-17T10:43:00.000-04:00

Why Brevard?

I was recently asked by a school mate from many years ago why I live in Brevard County. Having been born and raised in South Florida, I moved to this area more than 30 years ago when it was a sleepy little dot on the map. At that time, it was not a very "pretty area" coming off Interstate 95 heading east on U.S. 192.

I can truly say, "Brevard, you have come a long way, baby!"

I am passionate about Brevard for many reasons.

First, I love the water. Beaches, rivers, lagoons, lakes . . . you name it, we have it.

The wildlife intrigues me. To come face to face with manatee, blue heron, nesting loggerheads and occasionally spotting an alligator, is absolutely fascinating.

I like to see the sunrise and enjoy the sunsets and be able to breathe fresh air.

Flying in and out of Melbourne International Airport is a treat. Compare this experience to Orlando or Ft. Lauderdale, and you will know what I mean.

The schools are good, and the people are friendly.

If you go out to a nice dinner, you can get reservations and enjoy life. I guess you can say this is the good life.

Boating, golf, surfing, skiing, sky diving, tennis, virtually all sports are offered in this paradise called Brevard.

And we have a variety of housing that can suit the needs of almost anyone who wants to live here.

Condos on the ocean and river are now priced reasonably.

Condos on the mainland are priced even better.

Townhomes, and single-family homes offered in a variety of prices and styles appeal to many. Single-family homes on golf courses in planned communities and wonderful country homes with minimal restrictions give buyers a wide range of choices and prices.

We have come full circle from 2002 when homes were affordable, we then rode the wave to the peak of pricing in 2005 and now to 2008, we are back to being affordable once more.

If you are just curious about the value of your home, there is an interesting consistency in the market value on your tax rolls and your true market value with today's prices.

This is not always 100 percent accurate, but the consistency is clear more often than not. This was not the case in years past. The real estate market continues to be active and prices are beginning to stabilize although still reflecting the lower values.

If you are looking to move here, you have just discovered paradise.

Housing market on move.

2008-08-10T10:46:00.000-04:00

Throughout our analysis of real estate activity in Florida, trends show that the market for single-family homes peaks when families want to settle in for the back-to-school season.

Therefore, it makes sense that the market would have more activity in the spring and through June and into mid-July.

Single-family home sales begin to slow a bit while families are getting children ready for school and the final vacations are taken.

When the first snow falls up North, the seasonal rental market begins to boom and the condo/townhouse market activity increases as the winter residents flock to Florida.

Now for the facts (as I see them), in the single-family residential market:

--- There are 6,001 active single family listings in Brevard County today. Since January, 2,879 homes have sold.

If sales continue at this same rate throughout this year and into 2009, it will take more than a year to sell these homes.

--- Today, there are 957 single-family homes under contract. The marketing time could be reduced to less than one year for a "balanced market" if homes under contract continue to increase and close as scheduled.

This number can be skewed by homes that remain under contract for an extended period of time, such as lease-options and lease-purchases common to this market.

Generally speaking, I could deduct 25 percent from the number of homes currently under contract and still contend that this real estate market is in the process of change.

A balanced market is when the inventory of homes and the buyers who close on a purchase are equal.

When the number of buyers exceeds the number of homes on the market, a balanced market changes into a seller's market, and that is when market appreciation begins.

This change is still down the road but the balanced market may be the light at the end of this tunnel.

The over $300,000 market is a more than two-year market but this too, has significant properties under contract and as the lower priced homes sell, the ripple effect heads to the next increase in price.

The higher priced market in the over $700,000 price range is still saturated but an increase in movement is reported.

The luxury market, although not reporting any significant decrease in pricing , is very slow moving. Those in the luxury market appear to have the staying power and are not inclined to reduce their prices to achieve a sale.

The real estate markets are slow turning markets as compared to the stock market with it's daily volatility. Patience and price reductions are the keys to selling today.

Condo market improves.

2008-08-03T10:48:00.000-04:00

As with all markets, the real estate market has its peaks and valleys.

Buyers can still search for months to find their dream property.

Negotiations of contracts proceed from the "insulting" low offers to a "meeting of the minds" on price within three to six weeks, when it used to be three to six days.

The good point is, the lower-priced properties or more desirable properties, may be receiving multiple offers. Please do not misunderstand . . . the offers are not list price or above but having more than one offer presented on the same property is great action in today's real estate market.

Now for the facts, as I calculate the action:

I see positive change in the oversupplied condominium market, based on statistics I see though the Multiple Listing Service.

Based on my analysis of the sales in the oceanfront condominium market since Jan. 1, I note that 25 oceanfront condo units are selling each month. There are 528 "active oceanfront condo" listings on the market.

With this information, I can forecast that it will take approximately 21 to 24 months to sell this existing inventory.

Now for the change: Currently 40 units are "under contract."

Provided this trend continues, and if these condo sales close in a 30-45 day period, this could change the market considerably.

That is, the existing inventory of condos might sell now in a 13 to 16 month timeframe -- a dramatic change from a two-year market to something approaching a one-year market.

What does this mean? In my opinion, it means that it is possible, if this selling trend continues, that the market may change from a "buyer's market" to a "balanced market" in 1.5 years instead of the 2-year period.

Great news for Brevard County and an encouragement for those buyers looking at oceanfront condos to get moving. These great buys may not last for long.

The overall view of activity over the past three months is indicated not only by the increase in the sales volume, but the fact that the average prices of sold properties are on the rise.

--- In May, the average sale price of "all properties sold" (to include residential, condo, vacant land, commercial/industrial and income properties) was $182,593.

--- In June, that average was $197,879;

--- In July, the average was $377,103.

Sales tend to have a domino effect when the market activity changes. When lower-priced properties move, it prompts those who sell to buy larger, more expensive homes and thus, the price range of sold properties begins to move to a higher priced bracket.

Market full of obstacles.

2008-07-27T10:50:00.000-04:00

The real estate market is active, but do not misunderstand this activity.

The value of your property is significantly lower than previous years, based on the homes buyers are selecting and the prices they negotiate and eventually pay.

The high-flying market of 2005 is not predicted to return for many years.

I too, like to dream and wish we could turn the clock back to those high prices and sell while the market was up.

If you want to sell now, go out and look at what you can buy . . . you will sell low, but you can buy so much more. In this way, you are not losing. You may even be gaining equity by finding a terrific value.

If past sales indicate a lower value for your property, do not think that you can price your home higher than past sales.

Look for homes you want to buy before placing your home on the market. In this way you may be more realistic as a seller in today's market.

This market has many challenges that face both buyers and sellers other than educating the sellers on pricing the home correctly.

A major challenge that faces each and every buyer is the challenge of financing.

Lenders are strict with credit reports to include prompt payment of student loans and verifiable income.

Inspection results concern the lender. Lenders limit the type and amount of credits back to the buyer at closing. Appraisers are very conservative in their evaluation and some lenders, upon review, may reduce the appraised value or the ratio of the loan to the value of the property.

They are strict with appraisals as we continue the label of a declining market.

Lenders scrutinize any and all aspects of the buyer's financial package, questioning each and every loan, each and every purchase, account balances and pay stub. This is typical and comes as a result of the problems that have resulted in the abundance of foreclosures.

Buyers sometimes experience buyer's remorse after finalizing a contract.

So many homes are on the market and buyers fear that, after their purchase, property values will drop. It is my opinion that property values have bottomed out.

This is indicated by the limited number of properties available in several locations.

It is further indicated by appraisals that result in value ranges lower than contract price.

Another strong indicator is the volume or number of sales each month in comparison to the number of new listings.

Fewer properties are coming on the market compared to the volume of sales.

All great indications that the market is active and the look for the future is positive.

Brevard boasts lots of hot buys.

2008-07-13T10:53:00.000-04:00

What can you buy in Brevard County?

I have been asked to give a sample of what is available in Brevard County. Wow! This is enlightening for me as I search for properties all day long.

Under $100,000, one can choose from more than 600 active single family homes. For example, in Cocoa, one can purchase a home built in 2002 with 1,800 square feet on 1.14 acres with 3 bedrooms and 2 bathrooms.

In Palm Bay, one of our fastest growing cities, there is a three-bedroom, two-bath home with a two-car garage built in 1996 and actively listed for $79,900.

In the condominium/townhouse market, one of the surprising properties is a two-bedroom, two-bath villa or patio home listed for $57,900, built in 2007.

In the Lake Washington area of Melbourne, a small condo on a lake and golf course can be purchased for $78,900.

There are currently 399 condos and townhomes actively on the market in our county for under $100,000.

On the ocean, currently listed, are 94 oceanfront condominiums for less than $250,000. One is listed as a townhouse in Cape Canaveral built in 2002 with two bedrooms and 2.5 baths for $250,000. Very surprising.

Now let us take a look at larger single family homes: There are 651 listings in Brevard County with 3,000 square feet.

In Rockledge, one can purchase a 3,230 square-foot home with a three-car garage for $375,000.

In Grant, one can buy a 3,662 square-foot home on 2.14 acres with a three-car garage for $399,900.

And in Titusville, one can purchase a 3,644 square-foot home for $299,000.

But wait, one just caught my eye. A 3,928 square-foot home for $266,800 with a garage. It is bank owned and sold "as is" in West Melbourne.

On the riverfront property values range from $279,500 up to the millions. None of the above-listed properties are advertised as "short sales."

One can get a very good value on a hot deal in today's market. Call your friends and relatives.

This is the time to buy. Please look further for specific locations, condition, etc. Your good agents can assist and find these properties for you.

Changing market presents problems.

2008-07-06T10:56:00.000-04:00

The real estate market is changing . . .

Many homes have been sold for very low prices, but what are the problems we face in this changing market?

With the change in the market, typical "arm's length" sales are having occasional problems with low appraisals. Another problem in this market is a change in the interest rate before closing.

When accepting the offer for sale, the seller and Realtor should do their best to make sure that the buyer is going through a local lender for financing.

Internet and out-of-town lenders have sometimes offered enticing interest rates that may or may not remain the same at closing. This dramatically affects the buyer, who was counting on a lower rate.

To complicate matters, most out-of-town lenders work with out-of-town appraisers while local lenders will order an appraisal from a local company.

An out-of-town appraiser might lack local knowledge and could submit an appraisal that doesn't take into account local factors.

Therein lies the problem -- the contract price and the appraised value can be thousands of dollars apart.

One solution might be to start over with a local lender. The appraisal would be reordered in hopes of a value in line with the contract price agreed by both buyer and seller.

In the event the appraisal cannot be changed by moving to a local lender, valuable time is lost and in some cases, both buyer and seller end up making concessions on interest rate and price in order to close this sale.

Sellers should have a specific list of upgrades on their property and should give this list to the appraiser.

Buyers in today's market, typically, do not overpay.

Today's buyers are educated and have access to all current listings and all recent sales via the Internet. There should not be a problem with homes appraising for their contracted sale price.

This trend of low appraisals may also indicate a change in the market to slight market appreciation which appraisers have not taken into account.

Still I contend that you can sell low and buy low in Brevard County.

Short sale has long haul.

2008-06-29T10:58:00.000-04:00

Everyone is whispering about "short sales."

What are they? Let me explain.

In my opinion, a short sale is an offering of a property below the amount owed on the mortgage.

For example, a listing down the street comes on the market for $300,000. The tax rolls may indicate that the owner paid $500,000 for this home in 2005. Let's assume that the bank's mortgage on the property is $400,000.

Is this a great deal? Can you purchase this property for $300,000 or less?

Many properties are going on the market and are advertised as a short sale when the lender has not agreed to take less than the full mortgage amount.

This short sale will not go anywhere without communication and agreement from the lender to accept a payoff for less than the actual mortgage amount that is due.

If you make an offer on this type of property, you may wait a long time for it to be presented to the lender, only to learn the lender will not accept an offer less than full payoff.

Your contract for sale and purchase may be signed by the seller, but it will require approval by the lender.

Be cautious and do not waste your time if the lender has not communicated and agreed to take less than the amount owed on the mortgage.

A typical lender is not going to agree to a short sale if the seller has adequate income, is not behind on payments and has equity in other properties and assets.

If the lender is involved and communicating with the seller and the listing agent, then go for it.

You might get a great deal, but be patient. This process can take months.

If the lender now owns the property because the seller did not make payments, and the lender took over the property through the foreclosure process, this property is now offered for sale by the lender.

Do your homework and make sure the price is right for a good value.

Make sure that you, the buyer, have a pre-qualification letter from your lender and have your agent write the offer.

Sellers who bought their homes long before 2005 typically have considerable equity and can offer a hot deal if they are motivated to sell.

Do not limit your looking to just short sales and foreclosures because hot deals are here.

Study the market value using comparable listings and sales in the neighborhood in which you are looking to purchase.

When you see a property offered for less than others, check it out. This could be the beginning of a great deal.

Be wise, work smart, and you will get the best value on your purchase

Choice of agent and price is crucial.

2008-06-22T11:00:00.000-04:00

Pricing your home correctly is one key to selling in today's market.

Start determining your home's value by calling two or three full-time agents for a market analysis.

Make sure to give each agent time to do this, and understand that if the agent is busy showing and selling, this is a good sign.

You may have an agent who has done well for you in the past.

Have confidence that he will work hard for you again. A good agent should provide you with the following:

--- Recently sold properties that are similar to your house.

--- Active listings that will compete with you once you place your home on the market.

--- A list of comparable houses that are under contract.

--- The number of active listings that are in your price range.

--- A complete marketing plan.

--- A personal resume showing the agent's sales volume and the organization to which this agent belongs.

Review similar sales and listings carefully. Do not choose an agent just because their analysis gives you a higher value. Market value is an opinion and is reviewed from the eyes of a buyer and not a motivated seller.

Motivated sellers must guard against overpricing in this market.

Another key to selling is signage.

In a buyer's market like this, a choice to forego a sign is a choice to limit your property's exposure on the market.

About 80 percent of buyers begin with the Internet and then choose to drive through neighborhoods after their search. Making your home easy to find is critical.

Sometimes these prospective buyers are searching for location and are sampling the surroundings even before they personally view a home they might be interested in.

Therefore, a sign is key, along with Internet marketing.

Relocation departments that bring in corporate employees from other cities vary from agency to agency, but such services can be a real boost to your chances of selling if your home is priced to sell.

Perseverance and patience is needed by all sellers.

The market continues to be active but still saturated with an oversupply.

Buy low, sell low a winning outcome.

2008-06-15T11:01:00.000-04:00

How does one get out of a home if you are "upside down?"

So you purchased a home in 2005 for $400,000 and now this home is barely worth $300,000.

There are several conditions that weigh heavily in the decision to sell if you are upside down.

--- How much of a mortgage do you have on this property?

--- Are you moving up? Do you want to buy a larger home for a higher price?

--- Do you want to move down? Do you want a smaller home at a lower price?

If you have little or no mortgage and you want to buy a more expensive home or a less expensive home, then go -- you will sell low and you will buy low. You are the winner in today's home market. Go buy this new home.

If you have a mortgage that is small enough to enable you to sell, pay closing costs from the proceeds and put 20 percent down on your next home, you are golden. All signals are a go.

For example, if your home is worth only $300,000 and your mortgage balance is in the range of $200,000, you can pay closing costs, and walk away with some cash.

Before you even think of selling, please go to your mortgage lender and make sure you can secure a loan for the home you wish to purchase if you sell low.

If you want to purchase a home valued in today's market for $500,000, you may have to come up with 20 percent down or $100,000 in order to purchase. Sellers, in today's market, will often be willing to pay your closing costs if you purchase their home.

If you do not have money in savings or an IRA that you can borrow from, be cautious about selling.

If you buy low after selling low, then you are doing great. The values are out there in this market.

Do not take the position that you are losing money because you are indeed making this loss up on the buy side. This is either a lateral move, one that keeps you with the same equity, or it is a win for you as the higher-priced home may begin to increase in the future and you will gain more equity.

If you have a home that is overmortgaged, that is, you owe more on your mortgage than what your home is worth, be sure you can sell or move. You may be the one who has to accept where you are and just stay and enjoy your home.

Long term will prove to be OK for you, in my opinion.

But sometimes long term is longer than you want to stay in the home. That is when you have to get creative in finding funds to pay off your home.

Have you an investment that you can liquidate and accomplish your goals? A good financial planner can assist you in this decision.

Building equity the right way

2008-06-08T11:03:00.000-04:00

Equity is the value of your property, minus your mortgage. This should be an important part of your net worth.

I have always advised my adult children that when they sell a home, take all of the proceeds of the sale and put it all down on your next home.

Yes, we all are tempted buy that new TV and great sofa and then maybe a down payment on a new car with the cash before we put that equity down on another house.

Bad idea.

All of the preceding items: TV, sofa, car, depreciate rapidly. But your home should, if you have selected the greatest location and are in for the long haul, build equity over time and appreciate in value.

This is the safe way to buy.

I am not sure I would advise an equity line of credit for property improvements unless an equity line is the only way you can improve your property.

Taking funds each month from your own paycheck and gradually improving your home, paying for these improvements as you go, is a method of forced savings and building equity.

Taking any money you may get on a tax refund and placing this down on the principle balance of your mortgage is a method of paying off your home earlier than expected. Your home equity will build rapidly if you make this part of your normal financial plans.

What are the improvements that add to the value of your home?

One of the most important improvements is landscaping.

Enhancing the exterior appeal of your home entices people to want to look at your property.

Even if your home is not for sale, you and your neighbors will enjoy the look of a beautifully landscaped home.

Fruit-bearing trees are often a wise move, because freshly squeezed orange juice is something Northern buyers and visitors will love.

In most areas of Florida, a pool adds value to your home.

It does not always add the full cost of the pool, but you can enjoy that pool and know that buyers for Florida real estate, will typically, pay more for a pool home.

Normal maintenance is an absolute must for building and holding equity.

Homes depreciate rapidly if they are not cared for in every way.

Pest control and routine termite inspections are critical to safeguarding the integrity of your property.

Painting inside and outside, routine air conditioning servicing, maintenance of irrigation systems, and overall care of your home, is most important. Maintenance is the way to safeguard unnecessary depreciation.

Last but not least, if your earnings climb each year, those home-sale proceeds really help you move into a more expensive home and keep moving up.

Your equity will increase and your dream home will be a reality.

Learn lessons from '05

2008-06-01T11:05:00.000-04:00

The government rewards us for being homeowners.

And why not?

We are investing in the American dream, which for many people includes homeownership. The government allows us to write off our mortgage interest and taxes on our federal tax returns.

In addition, if we own investment property, we can depreciate this property over time.

What a way to go.

Make your plans and take your time to think of your future. Real estate is not a get-rich-quick scheme. It is a long-term, deliberate choice to buy, enjoy and build equity.

The mistakes of 2005 tell us over and over again that we are not in the kind of market to buy and "flip" or sell quickly and make a profit. Those times are gone.

However, 2005 has taught us the following:

--- Be careful in looking for mortgages. Make sure you find the best interest rates and the lowest closing costs.

Make sure you understand the consequences of possible pre-payment penalties or changes in the interest rate that could negatively affect you.

Do not be afraid to ask questions and talk to several lenders.

Understanding closing costs isn't always easy, so ask about "typical costs," "mandatory costs" (like taxes) and "garbage fees" (unnecessary lender charges).

Most important, do not go for the mortgage you can just afford, but be conservative and go for the amount of mortgage payment that you are comfortable with.

--- Be careful in looking for homes. Do not view more than five homes in one day.

A trained Realtor can keep up with the numerous combinations, but most people start losing track after three -- remembering such basics as location, floor plan, colors and particular features of the home.

The most important part of purchasing a home is the location. It should be convenient to work, schools and shopping.

Rank the homes that you see and eliminate the ones that do not work for you.

Think and be critical about the homes you have viewed, but remember that many features, such as paint color, landscaping, carpet and flooring, can be changed.

Location, floor plans and neighborhoods cannot. These are most important.

--- Know about the sales contract that you will sign and make sure this contract is contingent on any inspections of the home being satisfactory to you, in all respects OR you reserve the right to cancel this contract.

--- Make your home purchase a priority. Find a knowledgeable agent you trust.

A good agent will guide you and assist you in this most important decision.

Make this decision wisely. Lessons learned from 2005 are good lessons.

Data shows trends...

2008-05-25T11:06:00.001-04:00

Let's cut to the chase.

Here's a snapshot of the current market information since January:

--- In condominium sales in Brevard County, the number of new listings coming on the market has been consistently dropping since January. So our supply is decreasing.

Prices of sold condos show the lowest average sale prices in February and have been increasing since that time but not quite as high as the sale prices in January.

These statistics support my opinion that the market has bottomed out in this category. Cautiously, I report that we are still showing an oversupply.

--- Residential sales indicate the lowest pricing in April and the highest pricing in March. May sales show an increase over April prices.

The number of new listings coming on the market are at an all-time low since January. Sales volume peaked in April and contingent contracts show a high in April, which may cause a spike in the volume of closed sales in the next few months.

My data source shows a slight increase in sale prices since April, but sale prices are still lower than those reported in January.

This is, again, an indication that the market may have bottomed out.

New listings coming on the market are definitely reduced by a significant number and show a consistent reduction since January. An oversupply still exists in this category but some areas show a limited number of available properties.

This, in my opinion, is a good sign that this market is recovering. If you are a buyer who is thinking about buying, consider putting your thoughts into action.

--- Slow and low sales still plague the vacant-land market. Hopefully, when the housing supply begins to balance, the vacant-land sales will increase and new construction will pick up.

--- Townhouses also show fewer new listings in somewhat of a consistent manner since January until the end of May. Townhouse prices were at the lowest point in January, peaking in price in February, March and April.

May prices were higher than January's prices, with the volume of sales indicating an increase over January, February and April.

Sellers in today's market need to be in tune with pricing and be willing to have their homes in show condition when appointments are made.

Pricing your property to be one of the best of the three good buys shows your willingness to entice offers from eager buyers.

A note from last week: My column included a photo of people moving with a caption that indicated 16,000 people move to Florida each day. The caption should have said come to Florida each week.

Good buys abound in Brevard

2008-05-18T11:08:00.000-04:00

Brevard County is moving up.

About 16,000 new people come to Florida each day.

How do we capture our fair share in Brevard?

We have all of the ingredients of a healthy economic base: diversity in businesses, the corporate headquarters of several companies, an abundance of recreational activities and a climate many people enjoy.

The hiring of new employees adds to this strength in our housing market in both sales and rentals.

Brevard County's affordable housing market did not exist in 2005.

However, the current affordability will lure more residents to the Space Coast and pull us out of our housing glut quicker than other areas throughout the United States.

A continued upswing in sales and rental activity gives local residents the encouragement to sell now, even though the prices are low.

Residents can still get a good value when moving up to a larger home or scaling down to a smaller residence. It continues to be a great time to buy.

Action also continues to increase in the resale housing market, and developers are beginning to site properties for future development, but those new developments could take years to be ready for consumers.

Values on vacant lots ready for new construction are truly "outstanding buys" at this time. Builders are offering competitive prices for building single-family homes and paperwork for new permits is being filed.

Although there remains an oversupply of homes, condos, townhouses and land, consistent increased sales activity is apparent in all price ranges.

County's market getting better.

2008-05-11T11:09:00.000-04:00

The Brevard County real estate market continues to show signs of improvement. Good signs.

There are fewer listings on the market in all types of residential properties -- single-family homes, condominiums, and townhouses.

It's not a significant number of fewer listings, but a lower number than the preceding months.

Statistics show more sold residential properties than the preceding months. The largest number of sales are in the category of townhouses, followed by condominiums.

This has been our most saturated market. It appears that buyers are seeing the values and deciding that these two types of properties are good, if not, great buys these days.

The most significant statistic is in the area of "contracts pending or contingent."

This categorizes those properties that have negotiated an agreement to sell (under contract) but have not yet closed. This figure, if these properties close, will show a 30 percent increase over recent sales in all categories of residential properties.

But let us be realistic -- the inventory still is significantly greater than the current number of buyers, so we are still in a buyer's market.

My report indicates that the market is due for a change in the future.

Just how does the real estate market change?

Slowly, even though things are improving.

There are so many existing properties on the market. The many selections that buyers have is decreasing, however, there still are many properties to choose from.

The best buys and the most desirable properties, will be picked up first.

The market, if the action continues at this rate, will then go to a "balanced market."

I predict that this will happen in most areas within the next 18 months.

Some areas show indications that this change will happen sooner and some later.

This is, of course, is determined by the number of listings and the action in a particular location.

I see the market balancing out, but I do not predict that we will go to a seller's market any time in the near future. The balanced market will show appreciation in value say 2 to 5 percent a year.

Our dreams of returning to 30 to 50 percent market appreciation are only dreams.

If you are moving within Brevard County, "buy low, sell low" is the way to go.

Peaks, valleys continue

2008-05-04T11:10:00.000-04:00

The flurry of action continues in today's market.

Reports in some beachside areas show three times more contracts on existing properties in the most recent 30-day period.

Think of this: We were in a market with an absorption rate --that is, the time it takes to sell an existing inventory of homes -- of two to three years.

If the action continues at the same pace as in the past 30 days, the absorption rate could shorten to about one year in some areas.

Buyers who have been searching for their dream home need to focus and commit or they might lose the property they've been hoping to buy.

Time on the market does not dictate that the home is not valued properly.

Sellers have had to adjust to the decrease in value as indicated by the dropping of the home's listed price over the period of time on the market. Sellers who delayed in reducing their price might have missed the opportunity to sell for a higher price as the market was dropping rapidly.

Many sellers have turned down prices higher than their current list prices.

If the seller has reduced his/her price over the period of one or two years, the price may now be ready to sell -- still with some negotiation.

Where are we headed?

Not so fast, I do not believe that this action can continue at this same rate for the next year.

I think that we all know that, even in an active market, there are peaks and valleys.

There is a flurry when spring arrives, and families look to move over the summer. There is a typical slowing when the children get ready to begin school after summer vacation.

There are popular vacation months where sales slow. And we all know that when the first snow falls up north, the phones begin to ring in search for properties in Florida.

Right now, I see this market as sizzling.

I see buyers viewing less of a selection for their dollars.

The best-priced and nicer properties will be sold, but there will be properties on the market.

Buyers will watch the sold properties for comparison and will be reluctant to offer more than recent recorded sales indicate.

Therefore, my forecast is this: Continued action, but at a realistic and more consistent pace.

A balanced market is in our future. Market appreciation will come in pockets of areas that show less of a selection, as in the market price of $700,000 to $1,000,000 and in specific areas of newer, more custom homes if there is not an oversupply in a specific neighborhood.

There now exists the possibility of future appreciation or limited selection.

Sell low, buy low.

Are sales heating up for summer?

2008-04-27T20:07:00.003-04:00

Sizzle, sizzle, sizzle . . .

Action in the real estate market has increased to the point that, in my opinion from what I have witnessed, I can truly say there has been more activity (showing appointments, contracts written and closings) in the past 30-45 days than in the past four months combined. Cautiously, we approach May, June, and July with optimism.

Just a blip? Can the market continue to be active?

One or two months of activity does not yet indicate a trend. This could be just a ruffle of action. Time will tell, but let's hope that this will continue throughout the remainder of 2008. We can create our own future by spreading this whirlwind of action through hard work to close the sale while working with lenders' new restrictions and conservative appraisals.

Obstacles challenge all involved in the real estate transaction. The goal is to hang in there if buying or selling. There exists a ripple effect when sales begin -- when a buyer completes a
sale, it frees a seller to begin seriously shopping, which can lead to another sale, and so forth.

Looking up. Now for the facts to support this level of activity.

In some neighborhoods, sales have averaged about one a month for a while. Now, those same areas have five to six pending contracts. Compared to one home sale per month, this is incredible.

Sale prices are not, in most cases, showing increases in value. In fact, some decreases in value, in current sale prices are reflected in the closed sale data. The volume of sales has increased but the values are tending to remain the same or decrease slightly. Another fact: there are fewer properties on the market.

The Home Builders and Contractors of Brevard recently wrapped up its Parade of Homes on a high note, encouraged by the traffic they saw at their sales sites. Upswings in the market have to start somewhere. While this could be a short-term blip in the market, it also could be the
beginnings of a better summer.

Finding balance in today's market.

2008-04-20T20:14:00.000-04:00

Knowing the difference between wants and needs -- and staying faithful to those differences when buying or selling real estate -- is as important now as ever.

As a seller, determine what you need to do.

Must you sell in today's market?
Is illness forcing the sale?
Are finances forcing the sale?
Is a job transfer forcing the sale?

If the answer is yes to any of these questions, there is little room for options. You need to sell.

What do you need?

Do not worry about what your neighbor thinks of the price you place on
your property. No one has exactly your same needs. Sellers should do what they need to do to show their home on a moment's notice -- clean, paint and freshen the exterior and interior of the property, and most important, price correctly and be willing to negotiate. We are all dreaming of the day this buyer's market will change to a seller's market.

We do not know if we will ever see real estate appreciation like we had in 2005, but home ownership is still a part of the American dream. And with home ownership, you build equity and with it a measure of financial security.

What do you want?

What are your wants?
Do you want to scale down your lifestyle?
Do you want to move up to a larger home for your growing family?

Today's real estate market will allow you to buy low, but you likely will have to sell low as well.
I recently listed a home for clients of mine. They wanted to pay off their $100,000 mortgage, buy a home for cash and live debt-free.

Of course, I said, "You know this is not the best time to sell, but it is an absolutely wonderful time to buy."
They agreed and followed my suggestion of coming into the office to review the sold and listed properties in their neighborhood. Once we established a value of their home, I gave them an idea of the cash they would receive at closing after paying off expenses and their mortgage.
We then found properties they could purchase with the cash they would have. This young, very smart, couple found townhomes, newer than their former home, and with the same living space. Such a smart couple.

We would all like to have our home paid for by the time we are 40. They are scheduled to close on their "dream townhome" on Monday. There is something to be learned from those who follow their wants and needs and make it all happen.

Buyers really are buying in Brevard,

2008-04-13T20:21:00.000-04:00

Many sellers have requested additional information on today's market.

Fact No. 1: The market is still a buyer's market.

Fact No. 2: Buyers are buying.

If you are serious about selling, check the market listings in your neighborhood. Be in the top 3.
Position your home to be in the three listings of those most aggressively priced for age, size, condition and upgrades.

Think real -- know what has sold recently (during the past 120 days) as well as what is under contract now. You also need to know the prices of competitive listings. Your Realtor can give you all of this information. Most important, make sure your list price is realistic.

You will sell your home in this market if you follow these guidelines.

Never say never. When an offer is presented, never reject the offer outright. Once you reject an offer, you have no chance of making a sale. Do not be
insulted at the low offer. Instead, accept or counter the offer in a realistic manner that can meet your needs. The counteroffer needs to be consistent with the numbers (sale and list
prices) in this market.
If your buyer walks away after your counteroffer, and then you reconsider and think that you should have taken the last offer, have your agent call the buyer or buyer's agent and offer to accept the previous offer.
Be tough.
Remember, be aggressive!
Take the time to look at open houses and properties that you, as a buyer, would be interested in purchasing. You may find that your favorite house is reduced to the point that you can accept a lower offer on your home and still purchase the property that
you want.

Statistics to make you happy:

In January, the Melbourne Area Association of Realtors shows 204 properties were sold.
In February, these statistics show 269 sold properties.
In March, these statistics show 336 sold properties.

Life is good -- property is selling!

Making list not bad for Brevard.

2008-03-30T21:57:00.000-04:00

Brevard County recently made another list, but was it a good list or a bad list?

It was reported last week that mortgage lenders in Brevard County will not lend more than 80 percent of some homes' value. In other words, a homebuyer would be required to come up with a down payment of at least 20 percent to purchase a home.

What does this mean? Let me explain.

Private mortgage insurance, known as PMI in the mortgage business, is issued on loans for more than 80 percent of the value or sale price of a property. This type of insurance is not "life" insurance to pay off the mortgage should you die but rather insurance for lenders who want to protect themselves in the event a borrower defaults on a loan. These loans are called "high-risk loans" with little or no equity from the buyer.

About a quarter of all home loans in Brevard County made between 2002 and 2006 required private mortgage insurance, according to the Federal Financial Institutions Examination Council.
Brevard County was cited as one area of the country in which restrictions have been placed on some kinds of loans of more than 80 percent. The restrictions are aimed at loans on properties that are not owner-occupied or are not primary residences.

I don't consider this a bad list. I think this is a good, safe list.

It will help put loans in the proper place. An investor who cannot afford to put down 20 percent on a property probably should not purchase the property. A person buying a second home who cannot put 20 percent down probably should reconsider buying.

However, a first-time homebuyer with good credit and a stable work history likely will be offered financing of more than 80 percent and likely will qualify for private mortgage insurance.
A buyer who has lost equity through the sale of their home in a market such as this deserves to be able to purchase a home without a 20 percent down payment. This will happen in the current mortgage market.

Not everyone is able to make a sizable down payment on a home, and the mortgage insurance system takes that into account. The headlines initially looked shocking, but the reality of the change in mortgage insurance will work for most homebuyers. Safety measures are placed on us to protect the properties and the people who purchase them and the lenders who finance them. Our market is in the "correction stage."

Conservative measures are not a bad thing. Such measures would have helped eliminate or reduce the number of home foreclosures in the market across the nation.

Lesson in supply, demand, scarcity...

2008-03-16T22:00:00.000-04:00

What creates value in real estate?

The answers are simple and apply to practically every sales market: scarcity, supply and demand. If a property is limited and desirable, then the chances of market appreciation increase.

If you purchase property in a new development, and the new development is surrounded by vacant land, the vacant land continues the supply. Therefore, no matter how desirable, your home can only appreciate in the amount of replacement costs, because homes can continue to be built in a similar environment. In other words, buyers can simply build their own instead of buying your house.

Raising value-

If you purchase property that is scarce, -- that is, the area is completely developed and cannot be duplicated -- then the chances of market appreciation increase. For instance, there is a limited amount of land in Brevard County's beachside neighborhoods. Add that fact to many customers' desire to live beachside, and the result is greater value.

Similarly, the Lake Washington area is limited from developing to the west because there is an actual lake in the way.

Right now, in this current market, the supply of properties either beachside or in areas such as Lake Washington are plentiful, therefore, there is no market appreciation. For properties to appreciate, the demand must outweigh the supply.

Dwindling supply-

Now, as this market begins to change because of heavy influx of new employees and our special winter residents, we might begin to see our supply dwindle, thus creating a market that is appreciating.

In my professional opinion, this will not happen for several years down the road as we have an abundance of inventory in the home, townhome and condominium market. But as this market activity increases, buyers might find that their favorite property that they have been waiting to see the list price continue to drop has been purchased. There is a supply, but the very best values are being absorbed or purchased right now in this market.

Sellers. time to get ready.

2008-03-02T22:05:00.000-05:00

Buyers have arrived. Make sure you, as a seller, are ready.

If you need to sell for one of the following reasons, be prepared:

You are transferred and "must sell."
You want to "scale down" to a smaller place or move up to a larger place because you know that if you "sell low," then you can "buy low."
Illness or financial reasons are forcing you to sell.

If you are "testing the market," do not sell now. Only serious sellers should be in this market.
You have heard it before. We are in a buyers' market, and if you are the seller, unfortunately, you are not in control. A motivated seller must do several things to market his or her home.

Price it right: Most important is price.

This, very obviously, is a price-driven market. Sellers need to make sure that their home is competitively priced. One must keep abreast of all sales and all listings that are comparable.
Don't be fooled by "overpriced" listings. We all would like to believe that our home is worth much more than our neighbor's home. Of course, it is to us . . . but probably not to today's buyer.

Get a reality check if you want to sell.

Sales price determines value, unless list price is less than the most recent sales. If so, then the low-priced listing now has become your neighborhood "benchmark."

Make it look good: Now that you are priced right, how does your home look to the buyer?

First impressions: Your front yard -- is it manicured?

Freshly painted on both the exterior and interior of your home?

Sparkling-clean from the front door and throughout the entire house?

And what about that purple bedroom? Paint it beige.

If you answered "yes," and you have neutralized the coloring of your home, you could be one of the buyer's top three choices.

Make it easy to show: We've established a competitive price, the home is freshly painted and sparkling clean, but we are inconvenienced by the showings from Realtors. If you make this home difficult to show, it will not sell. Sometimes, an agent shows 10 homes in one day, and proceeds to show the buyer (who wants to see everything out there) 10 more homes for the next five or seven days. Yes, the Realtor may run late or early, but he/she is trying to please the buyer, so this buyer will buy. And if you make your home too difficult to show, there are many others that will make it easy for the agent. Stay in the running. Make it easy to show.
Getting the offer: When it comes to the offer, this is a stressful time. Buyers are making very low offers, but if they try the offers on the top three, and none negotiate to 25 percent off the list price, then the buyer comes back to his/her first choice, and gets the message that maybe the homes are "priced right."
Don't get your hopes up. The buyer is not going to pay list price unless you are way below the market, or unless you have all of the features and exact taste of the buyer. That is, this buyer could move in and bring furniture that looks like it was made for your home.
You, then, have found the perfect buyer. Most buyers are beginning to settle on 10 percent off of the list price if the home is priced correctly.
Financing and inspections: Do not think your home is sold until after the buyer has had the home inspected and accepted the inspection results. Then, you are getting close. Financing is the most important part of this transaction. We would all like the cash buyer. There are some, but not that many.

The seller should ask for a pre-approval letter from a local lender. But it is still not a sure thing.
Lenders are getting very particular. A full-loan commitment is a must before closing can take place. Do not move out of your home until your agent has reported the good news. Monitoring the loan process is of the utmost importance. Even with a loan commitment, the deal can fall.

Some lenders, in this changing market, can come back and ask for more information or actually deny the loan or change the terms on the buyer. If the buyer is marginal, make sure you have a good, conservative agent to guide you in your move and closing of this very important transaction. Closing papers have been reviewed and approved then.

Next, the cashier's check is given to the closing agent, the wire transfer from the lender has been received. The closing agent hands you your check. Now, breathe easy. You are closed.

There are three types of buyers in market.

2008-02-17T22:23:00.000-05:00

What should you think about before you buy real estate? The market is right for the purchase, but how does one choose real estate as an investment?

Three types of buyers will be addressed:
--- The buyer who is purchasing a "dream home" to live in forever.
--- The buyer who is purchasing a home to live in for two to four years.
--- The investor looking to rent the property and hold for a long term.

Long-term
For the long-term purchase of your dream home, look at the old adage -- location, location, location. But what else is necessary? One becomes emotional about the purchase of a home that he or she will live in for a long period of time.

If you are quite certain that this is a long-term purchase, then go with what you like in location, floor plan and amenities. The price will be right if you have your agent pull the last sales and comparable listings in the neighborhood, and you negotiate with this information at hand.

It is hard to go wrong in a buyer's market if you are going to stay in this home for many years.
For those in professions such as teachers, firefighters and police officers, there are wonderful programs offering 100 percent financing with excellent low-interest rates.

Shorter-term

There are some proven formulas for guidance for those buyers who will be living in their home for only two to four years. This buyer must look carefully at the home purchase to safeguard the investment, knowing that resale is a possibility within the next few years. This buyer needs to compromise the emotion for the practical aspect of an investment purchase.

There is the ratio of land to building. This sounds more difficult than it is, but the ratio of land to building on a typical home should be 25 percent land to 75 percent improvements. This does not hold for waterfront or more valuable property. A 50 percent/50 percent ratio is used in this category.

The rationale for this ratio of 25 percent land to 75 percent improvements is the fact that land typically does not depreciate over time, but improvements do depreciate (they age). If you are buying the most expensive home in a neighborhood, when you go to sell, it will be more difficult, and you may not have made a wise investment, unless your purchase was a great deal. Stay with the idea of purchasing the least expensive home in the most expensive neighborhood that you can comfortably afford. Most likely, your ratio of land to value will be within the 25 percent to 75 percent range.

If you are building a new home, it is easy to follow this formula: If your lot price is $100,000, then your improvements should not go more than $300,000, for a total package price of $400,000. If you "overimprove," it is more difficult to protect your investment if you must sell your home.

Many new subdivisions host the premium builders to feature their spectacular home. This is the time to purchase those spec homes, as the price probably has dropped more to the 25 percent to 75 percent ratio, even though the home costs more than 75 percent of the land cost to build.
In essence, when you purchase these homes at today's prices, you might very well be getting all of the extra custom features for no cost or minimal costs.

Check the popular number of bedrooms. For instance a four-bedroom pool home usually is the hottest seller on the market in most areas.

Stay clear of "locational objections," such as backing up to busy streets or having commercial property abutting your investment.

Make this purchase a clear, popular, calculated choice.

Investment rentals

Investment rental property is another challenge. I used to consider putting aside three times the payment on a rental property for vacancy when the property is not rented. Now, I direct an investor to hold three times the payment for repairs/assessments and six times the payment for possible vacancy -- a total of nine months' carrying costs for this property.

The market is a tenant's market also. Many past investors could not sell their properties, so they have rented them, thus flooding the rental market. This market is soft -- that is, still a buyer's market -- but changing slightly as each month passes.

Be conservative in selecting an investment. Seek information on future taxes and assessments, and project maximum insurance costs. If the negative cash flow shows a promise for future market appreciation, and you, as an investor, are here for the five years' or longer stay, then go for it. The time is right.

Many of the negative features -- such as the negative cash flow, high insurance and taxes -- are forecasted to be reduced in the years to come, but do not count on it. Play this in a conservative manner, and you most likely will profit.

Second-home markets are ripe for purchases. Condominiums are still, in most cases, in abundance, so begin your study of the real estate market now, and do not wait too long to purchase. Interest rates are low, and the values are incredible at this time.

Brevard market starting to equalize.

2008-02-10T22:37:00.002-05:00

The term "equalization," as it relates to real estate, may be a new one to you.

I believe this is a process that is just beginning to take place in the real estate community throughout Brevard County. Our market has been extremely volatile. Our prices were sky-high in 2005, dropped in 2006, and fell even lower in 2007.

Where are we going in 2008?

In my professional opinion, as a broker, we are at the point of the beginning of "equalization."
Every office has seen offers lower than one-half the list price of a home. A seller, who needed to sell, may have dropped his or her price to a midrange from the initial offer and sold.

Those sales all are a matter of public record, and one has access to this information through the Brevard County Property Appraiser's Web site. In the past, when a seller saw the recorded sale or heard of the low sale price, if one were smart, he or she did one of two things: Removed the home from the market or dropped the price to compete for the buyers in the market. At this time, the majority of listings are beginning to be priced competitively -- that is, sellers have begun to realize they must price their home with today's prices, not those of years' past.

A buyer can easily see competitive homes in the area, which may still be overpriced. It also should be apparent to a buyer which homes may be priced "right." At this point, the buyers in the market have heard of the low prices that sellers were accepting, but the buyers may not be in tune with a slight change in the market.

The process of equalization or a market correction is beginning to take place. Many of the low-priced offers are not receiving low counteroffers because the sellers have reduced the prices to within the correct range of value. This may not be true of all homes, because there always will be sellers who will sell for a lower price if they are in distress.

Perspective buyers may search the Web, and find that sellers have negotiated a great deal off of the list price in the past -- up to a 25 percent to 35 percent reduction. But, as we look into the homes going under contract today, some contract prices are beginning to come closer to the list price.

The remaining "steals" are being absorbed. This is the correction.

Sellers have found that, if they needed to sell, they had to move down, because the market has forced them to do so because of the oversupply. It took awhile for sellers to realize how low the market had spiraled. Now, it is time for buyers to realize they might miss out on the house they like because it may not go any lower. With the interest rates low and the portability of homestead, we probably have reached the point of equalization.

After this point, the market then begins to stabilize -- that is, there is a "balance" in the real estate market.

I use two methods to determine if there is a change in the real estate market:

The first is the ratio of recent sold prices, compared with the list price of a property. The closer the sale price is to the list price, the closer we are to a balanced market.

The second method is the absorption rate. The absorption rate is determined by taking the active listings in an area, and comparing them with the number of sold properties within the past two to three months.

If there are 20 listings currently in your neighborhood, and five have sold in the past three months, then it will take an estimated 12 months to absorb the remaining listings, provided there are similar numbers of buyers in the next few months as there were in the past. If the activity level continues to increase, then the time or absorption rate decreases. My research in most neighborhoods in 2007 indicated an absorption rate of 12 months to two years in many areas.

In some areas, the absorption rate was projected to be as long as four years. Last week, my research for a particular neighborhood indicated a four-month absorption rate -- one positive sign of a changing market.