Blog Archive

Tuesday, January 29, 2019

First Time Home Buyer Programs in Florida - US News and World Report Article

Breaking into homeownership can be difficult. Hurdles such as affordability, credit history and market prices keep many people from achieving their goal of owning a house. Fortunately for Floridians, federal and state programs and mortgage products are aimed at first-time homebuyers to help ease the burden and make homeownership possible and lasting, especially as homeownership rates decline throughout the state.
The Florida homeownership rate is 64.4 percent as of the third quarter of 2018, according to the U.S. Census Bureau, while the average for all 50 states is 66.2 percent. Looking at homeownership in Florida before the recession, however, tells a much different story. In the first quarter of 2005, homeownership in the state was at a whopping 73.2 percent, the highest point up until present day and nearly three percent above the national average at the time.
Homeownership in Florida has fallen in the last decade, but that shouldn’t scare eager homebuyers from pursuing their American dream. In fact, there are many programs to help people achieve homeownership sooner rather than later.
In most cases, first-time homebuyerprograms apply to more people than the title may imply, including those who have never owned a home, people never owned a home on their own and wish to be the sole owner of a property and others who lost their home to foreclosure three or more years ago.
First-time homebuyer programs come in many different varieties, including:
  • Home loan programs.
  • Financial support targeting aid outside the mortgage.
  • Buyer education courses and workshops.
Your path to homeownership may involve qualifying for one or more program options, which are aimed at helping people overcome the costly hurdles of buying a home and maintaining it. Read on for details to help you find the first-time homebuyer program that’s right for you.

Mortgage Programs

There are, of course, nationwide homebuyer programs available to Florida residents, including Federal Housing Administration loan options for first-time homebuyers, U.S. Department of Veterans Affairs loans and other national programs. Florida residents can also explore options from bank lenders and credit unions that offer first-time homebuyer programs.
The Florida Housing Finance Corporation, often referred to as Florida Housing, is a statewide organization originally formed by the state legislature to help provide a wide range of affordable housing options for Florida residents. While individual counties or cities may offer first-time homebuyer programs specific to locals, the majority of statewide programs originate with Florida Housing. Here are the options available throughout the state of Florida:

Florida First Government Loan Program – Military Heroes Program

“Florida Housing’s programs provide assistance to eligible homebuyers by offering low-cost, 30-year, fixed-rate mortgages together with down payment and closing cost assistance,” says Taylore Maxey, press secretary for the Florida Housing Finance Corporation. Under the Government Loan Program, mortgages issued include federal programs such as FHA loans, VA loans and U.S. Department of Agriculture Rural Development loans. An additional, Florida-specific option under this program is the Military Heroes Program, which helps honorably discharged veterans and active military benefit from a lower interest rate on their first mortgage.

Florida HFA Preferred Conventional Loan Program

For borrowers who qualify for a conventional 30-year, fixed-rate loan, the HFA Preferred loan program provides the chance to benefit from lower mortgage insurance costs if they put down less than 20 percent. Maxey explains the program uses a Fannie Mae-developed loan product geared toward state housing finance agencies. Rather than helping with the down payment or mortgage costs, this program focuses on lessening the blow mortgage insurance may have on a homeowner’s monthly costs. For eligible borrowers, this program can be transformed into the HFA Preferred 3% PLUS Conventional Loan Program, an enhanced version of the original program that provides additional assistance, by including an HFA Preferred Grant of up to 4 percent of the purchase of the house to go toward the down payment or closing costs.

Florida Assist Program

This down payment assistance program functions as a second mortgage, providing borrowers with a zero percent deferred payment loan of $7,500. The borrower repays upon sale of the property, refinancing of the first (and primary) mortgage, at the end of the first mortgage’s term or if the homeowner no longer considers the property his or her primary residence.

Homebuyer Loan Program

This second mortgage program provides as much as $10,000 to eligible homebuyers. With a 3 percent fixed rate, the total loan amount is paid monthly over 15 years.

Mortgage Credit Certificate Program

Rather than targeting the mortgage itself, this program provides qualified first-time homebuyers with a federal tax credit of up to $2,000 annually for as long as they claim the property as their primary residence, pay mortgage interest and have a tax liability. Federal tax law limits deductions of state and local income, sales and property taxes up to $10,000. If a homeowner has property taxes that push the tax deduction limit beyond $10,000, the MCC Program can help offset the amount.

State Housing Initiatives Partnership program

This program doesn't fund homebuyers directly from Florida Housing but is a partnership with local governments throughout the state to encourage and create more affordable housing. “The program was designed to serve very low, low and moderate income families. Depending on your income, you could be eligible for home repair or replacement, down payment assistance, rental housing assistance and other affordable housing assistance,” Maxey wrote in an email.
While the program covers new construction, rehabilitation, financing, acquisition and down payment assistance for all types of housing, a minimum of 65 percent of the SHIP’s funds are allocated toward homeownership actions.

Other Financial Programs

While they may not directly target the mortgage itself, other financially focused programs can ease the burden of a down payment, closing costs or even the market price of a home.

HFA Preferred Grant

The HFA Preferred Grant provides down payment or closing cost assistance to qualified homebuyers by providing up to 3 or 4 percent of the home’s purchase price. Serving as a grant rather than a loan, this statewide program doesn’t have to be repaid for the assistance it provides. Eligible borrowers make up to 140 percent of the area median income, typically based on either county or metropolitan statistical area. As the Florida HFA Preferred 3% PLUS Conventional Loan Program, the grant is combined with low mortgage insurance as well.

Infill Housing Program

Some cities or counties in Florida have established infill housing programs, which are focused on helping people achieve homeownership while also maintaining long-term affordable housing options. Miami-Dade County’s Infill Housing Program, for example, offers affordable home purchases to first-time homebuyers that fall under very low-income, low-income and moderate-income rates. Very low income, in Miami-Dade county, does not exceed 50 percent of the area median income, which the county's website notes is $52,300, while low income is 80 percent and moderate income is between 80 and 140 percent of the median area income. The income limits for each group are also based on family size. The goal of the program is to help residents achieve homeownership at an affordable cost relative to their income. Additionally, when a homebuyer makes a purchase through the Infill Housing Program, she agrees to a 20-year control period where the house must be sold to another qualified buyer through the same program, ensuring affordable housing can continue to exist. After 20 years, however, the property can be sold at market rate.

Education Courses and Workshops

While most first-time homebuyers need at least some financing to be able to purchase property, mortgage assistance isn’t the only way you can benefit from a program.
Many down payment assistance programs require proof of completion of a first-time homebuyer class or workshop, and fortunately these are available throughout Florida. You can typically find first-time homebuyer classes through:
Homebuyer education courses typically provide a certificate upon completion and cover budgeting, money management, how to find and apply for a mortgage, shopping for a home and the steps leading up to closing.
Counseling agencies typically offer one-on-one assistance to help with preparing a budget, determining how credit will affect your mortgage rate and finding a program that fits your situation and needs. The City of Tampa Office of Housing and Community Development, for example, provides post-purchase counseling that includes individual guidance to help people stay on top of mortgage payments, home maintenance and community involvement.
While the classes are often geared toward first-time homebuyers, housing counseling agencies are available to anyone looking for guidance on their home, whether it’s about making a purchase, trouble making payments or how to protect the investment.
https://realestate.usnews.com/real-estate/articles/first-time-homebuyer-programs-for-florida-residents
Devon Thorsby is the Real Estate editor at U.S. News & World Report, where she writes consumer-focused articles about the homebuying and selling process, home improvement, tenant rights and the state of the housing market.

She has appeared in media interviews across the U.S. including National Public Radio, WTOP (Washington, D.C.) and KOH (Reno, Nevada) and various print publications, as well as having served on panels discussing real estate development, city planning policy and homebuilding.

Previously, she served as a researcher of commercial real estate transactions and information, and is currently a member of the National Association of Real Estate Editors. Thorsby studied Political Science at the University of Michigan, where she also served as a news reporter and editor for the student newspaper The Michigan Daily. Follow her on Twitter or write to her at dthorsby@usnews.com

Thursday, January 24, 2019

Remodeling Magazine releases 2019 Cost vs. Value Report

Remodeling Magazine releases 2019 Cost vs. Value Report

 
WASHINGTON, D.C. – Jan. 23, 2019 – Remodeling Magazine released its 32nd annual Cost vs. Value Report, which compares the cost of popular remodeling projects to how much the investment will improve a home's resale value.
The 2019 report surveyed more than 3,200 real estate professionals about returns for 22 projects in 136 U.S. markets, an increase from 100 markets last year. The full report is posted online.
For all projects, the overall cost-to-value ratio is 66.1 percent, which is slightly ahead of last year but well below the decade-high of 71.2 percent in 2014.
As in prior years, there are significant variations in different regions. The average payback nationwide for the 22 projects in the 2019 Cost vs. Value report ranges from a high of 123.8 percent for a garage door replacement in the Pacific region, to a low of 45.0 percent for an upscale master suite addition in the mid-Atlantic region.
"With the increasing costs of building materials and labor, we urge remodelers to think like real-estate professionals first," says Clayton DeKorne, editor-in-chief of Remodeling Magazine. "When you adjust your focus to think like a broker first, you can dull clients' No. 1 pain point – cost – with a discussion of the amount that can be recouped, then go on to show them how to think like a remodeler by raising their understanding and appreciation of the total value, not just resale value, of a home."
Due in large part to sharp increases in material costs, the percentage of costs recouped at sale time is trending downward for all the replacement projects. Material costs tend to comprise a greater proportion of replacement projects compared with larger indoor remodels, however, which have a higher percentage of labor costs.
2019 top 10 projects by percentage of cost recouped
  1. Garage door replacement (97.5%)
  2. 2Manufactured stone veneer (94.9%)
  3. Mid-range minor kitchen remodel (80.5%)
  4. Wood deck addition (75.6%)
  5. Siding replacement (75.6%)
  6. Steel entry door replacement (74.9%)
  7. Vinyl window replacement (73.4%)
  8. Fiberglass grand entrance (71.9%)
  9. Wood window replacement (70.8%)
  10. Composite deck addition (69.1%)
Highlights from 2019 report
1. Rising materials costs impact rates of returnWhile the overall changes are modest, the latest Cost vs. Value report reflects the robust market the remodeling industry has enjoyed over the past year. But costs have correspondingly increased, and in some cases, significantly so. These increases are likely due to the tariffs that have roiled commodity markets, which have led to a slight downturn in the percentage of costs recouped for some projects; but overall, returns are up slightly compared to last year.
2. Curb appeal projects continue to provide the highest returns
Nine out of the top 10 high-return projects are exterior replacement – or high curb appeal – projects. The three exterior projects with the highest recoup on investment are garage door replacement (97.5%), manufactured stone veneer installation (94.9%), and a wood deck addition (75.6%). Siding replacement and window projects also provided high returns, with the highest recouping interior project being a minor kitchen remodel (80.5%).
3. New for 2019
Two new projects were added to the 2019 Cost vs. Value Report. The first is a roofing replacement job that adds standing-seam metal roofing. Compared with asphalt shingles, metal roofing costs significantly more but brings with it much greater durability. The second project is a revamp of the universal design bathroom, which was first introduced to Cost vs. Value in 2017. While the overall dimensions and features of the current project are comparable, the finishes and mechanicals – including tiled walls and shower, humidity-controlled ventilation and radiant-heat floors – are more consistent with an upscale project than the previous specs allowed.
4. Think like a broker
The reason for high returns on exterior projects, and especially façade facelifts, stems from the valuations set by the real estate community. "Curb appeal" and "first impressions" are central to a real estate professional's estimation of resale value. Granted, a home's exterior will only persuade potential buyers to see more, and first impressions can vary from one individual to the next. But the impact these impressions make is critical in setting the stage for what a buyer is willing to pay for a home.
© 2019 Florida Realtors®

Tuesday, January 22, 2019

Home remodeling projects owners most regret

Home remodeling projects owners most regret

 
NEW YORK – Jan. 18, 2019 – Remodeling isn’t as easy as it looks on TV, but many owners don’t realize it until they tackle a job on their own.

Nearly two-thirds of homeowners who’ve attempted a do-it-yourself house project say they regret not calling in an expert on at least one of their projects, according to a new survey from ImproveNet of about 2,000 Americans.
But the “save money” motivation is a big driver. On average, homeowners hoped to save at least 60 percent in costs by bypassing a professional and trying to do it themselves, the survey found. A separate study by the National Association of Realtors® shows a bigger attraction to DIY (do it yourself) home projects, particularly among younger generations.
On average, homeowners surveyed by ImproveNet attempted eight DIY house projects – but about a third admitted to later hiring a professional to redo the job.
“We’ve seen people take on a lot more than they could deal with,” says Joanne Theunissen, the remodeling chair of the National Association of Home Builders. “Be cautious. If it looks easy on TV, understand it’s not.”
The project that homeowners say they most regret attempting themselves is installing floor tiles, particularly in the master bath, according to the survey. Getting ceramic tile level and grouted correctly can be very tricky and require many thorough steps, Theunissen says.
Fifty-five percent of DIYers say their projects took longer to complete than they expected, and more than half said their project was physically more difficult than they anticipated. Fifty-five percent also said their finished project didn’t look as good as they had hoped – and about 8 percent said their homes were damaged because of their DIY attempts.
The top 10 most regretted DIY home improvement projects, according to ImproveNet, are:
  1. Installing floor tiles
  2. Replacing a ceiling
  3. Refinishing hardwood floors
  4. Installing carpets
  5. Finishing the basement
  6. Installing hardwood floors
  7. Refinishing cabinetry
  8. Installing sprinklers
  9. Installing showers and baths
  10. Painting home interiors
Source: “Study: The Home Improvement Projects You’ll Regret,” Improvenet.com (2019) and “The Home Improvement Projects DIYers Regret the Most—You’ll Never Guess No. 1,” realtor.com® (Jan. 8, 2019)