Lisa Barton

Overall, today's homebuyers tend to be fairly knowledgeable about the real estate market, but there are still a few points of confusion in the process, especially for buyers just entering the market. Here are the five main areas of confusion found in a survey by Zillow:

• Appreciation: About 42 percent of homebuyers believe home values will appreciate by seven percent a year. Reality: Historically, home values in a normal market appreciate by two to five percent in a year.
• Appraisals: 56 percent of the buyers said the purpose of the appraisal was to determine if a home was in good condition. Reality: That's the purpose of a home inspection; an appraisal estimates fair market value.
• Homeowner's insurance: 37 percent of homebuyers think that buying homeowner's insurance is optional. Reality: Lenders require homebuyers to purchase homeowner's insurance if they carry a mortgage.
• Ownership: 47 percent of homebuyers said a prospective buyer owns a home after the purchase contract is signed by the seller - when the two parties reach agreement. Reality: The purchase and sales agreement is the beginning of the closing phase but ownership doesn't occur until the transaction closes (when settlement occurs).
• Mortgage insurance: 41 percent of buyers think that they must purchase private mortgage insurance, regardless of the amount of their downpayment. Reality: Buyers only need to purchase PMI if their downpayment is less than 20 percent of the home's purchase price.

Source: Zillow Inc. Copyright 2011 INFORMATION, INC. Bethesda, MD (301) 215-4688

Good news for first-time home buyers who are veterans or are currently serving in the military! There is a new program available offering financial help in the forms of grants. Active duty personnel, veterans, retired members of the military and employees of the U.S. Department of Defense and the Department of Homeland Security may be eligible for a grant up to $5,000 to use toward downpayments and closing costs if buying their first home. The grants can be applied to a mortgage issued by any financial institution. Requirements: military affiliation - (active duty, reserve, National Guard or veteran); Department of Defense employee or a Department of Homeland Security employee; first-time homebuyer or not owned a home for the last three years or a home has been lost through divorce or disaster. Gross household income, including allowances, used to qualify for a mortgage loan is a maximum of $55,000 per year, or 80 percent of a community's median income based on family size. For more details, visit this website.. 

Source: "Veterans and Active Duty Can Get Financial Help When Buying Their First Home," Pentagon Federal Credit Union Foundation (July 25, 2011) Copyright 2011 INFORMATION, INC. Bethesda, MD (301) 215-4688. 

The Duval County Property Appraiser's Office now offers an online method to apply for homestead exemption, saving homeowners time and money. Previously, new homeowners had to either visit the Appraiser's office downtown or submit applications by fax or mail with additional attachments. The intuitive application asks necessary questions based on responses. The homestead exemption is a benefit for Florida homeowners which can provide up to $50,000* off the assessed value of a home; lowering property taxes. Once in place, the homestead exemption triggers another state law which limits the increase in the property's assessed value to three percent or less per year. Qualifying homeowners who moved into their home after Jan. 1, 2011 are eligible for a 2012 exemption and may file now through the March 1, 2012 deadline. The application is available at DuvalPA.com.

*A portion of the exemption does not apply to school taxes.

Love this article in Forbes Magazine about outrageous pools and backyards. The price tags of these homes make Ponte Vedra Beach look like a bargain!

More information that supports buying a home NOW:  a report by Trulia suggests thats it’s cheaper to buy a home than rent one in 72 percent of the 50 largest U.S. cities, according to their rent vs. buy index, which compares the total cost of homeownership to the cost of renting.

“Since the start of the ‘Great Recession,’ many former homeowners have flooded the rental market,” Pete Flint, CEO of Trulia, said in a news release about the index. “Following the principles of supply and demand, renting has become relatively more expensive than buying in most markets.”

The index compares the median sales price of homes with the median rent on two bedroom apartments, condos, and townhomes that were listed on Trulia as of Jan. 10, 2011.

Here are the top 10 cities where it’s best to buy than rent, according to the index:

1. Miami
2. Las Vegas
3. Arlington, Texas
4. Mesa, Ariz.
5. Phoenix, Ariz.
6. Jacksonville, Fla.
7. Sacramento, Calif.
8. San Antonio, Texas
9. Fresno, Calif.
10. El Paso, Texas

Now’s the time to buy a new house - real estate is becoming a popular method of investing again. I just read an interesting article in the National Association of Realtors’ newsletter. At this point in the year, stocks are up 50 percent from the March 2009 bottom. According to Michael Murphy, editor of the New World Investor stock newsletter, the only asset class left in the cellar is real estate. Mr. Murphy and other investors are encouraging their clients to purchase real estate as part of their financial portfolio. Here’s the gist of the article:

• Desperate sellers: Both home owners and lenders are eager to unload a flood of foreclosed and underwater properties. Buyers with the patience to push through these complex deals can save a bundle.
• Little competition. Because most people don’t have what it takes to negotiate their way through short sales and REOs, patient investors are winners.
• Low rates. Mortgage rates are at their lowest level in 40 years. If you believe inflation is inevitable, lock in now.

Good news on for home buyers! Mortgage rates fell to a record low for the fourth time in five weeks. The average rate for 30-year fixed loans this week was 4.56 percent, down from 4.57 last week. That’s the lowest interest rate new home buyers have seen since since Freddie Mac began tracking rates in 1971. The last time home loan rates were lower was during the 1950s, when most mortgages lasted just 20 or 25 years. The rate on the 15-year fixed loan dropped to 4.03 percent, down from 4.06 percent last week and the lowest on records dating back to 1991. And there’s more good news for the Jacksonville and Ponte Vedra Beach real estate markets—home sales are up!!! Prudential Network Realty has seen a big increase in sales this year.

The Northeast Florida Association of Realtors (NEFAR) has summarized the benefits of using a Realtor. I thought you might be interested. Here’s their article:
Realtors help people buy and sell residential or commercial properties, vacation homes, and land; they conduct appraisals; they operate in the United States and in other countries; some specialize in auctions; and others are buyer’s representatives.

One of the great benefits of being part of Prudential Network Realty is the affiliation with Gibraltar Mortgage, our in-house mortgage company. Gibraltar Mortgage is also an affiliate of Wells Fargo Home Mortgage, so they’ve got the backing of a national mortgage company. The home buyers I work with definitely benefit from this connection and now, Gibraltar Mortgage is offering a great deal for Prudential clients who are using a government loan (FHA/VA) for financing. Gibraltar Mortgage is providing a FREE 1% buy-down for the first year on a 30 year fixed mortgage. The deadline to apply for this program is July 31, 2010, so contact me soon if you’re interested. That 1% buy-down is a big deal! As of today, interest rates for FHA/VA loans are 4.875% (depending on your credit score). That means new home buyers can potentially enjoy a 3.875% interest rate for their first year. WOW! Marilyn Campbell is the loan officer in my Prudential Ponte Vedra office and she’s available to help my clients 24/7.

FHA insured mortgages are very attractive to buyers, especially first-time home buyers, because the down payment requirements (the cash you need to put down on the mortgage) are much lower than the down payment requirements for a conventional mortgage. For example, FHA requires a 3.5% down payment as opposed to the 20% down payment that’s usually required for a conventional mortgage. Many buyers who qualify for an FHA mortgage would like to buy a condominium, but not all condo communities are approved by the FHA—meaning that you can’t use FHA insured financing to purchase a home in that community. The FHA is stringent about its approval requirements. The condo community can’t be more than 50% rentals, the condo association must be solvent, and the buildings must meet FHA standards. Believe me, it can be very frustrating for buyers to fall in love with a condo and then find out that that community is not FHA approved. Your real estate agent should know which communities meet FHA approval in their local area, but you can always check out the FHA Approved Condo Link to verify the condo community you’re considering is eligible for FHA insured financing.