Nationwide Rent Increasing

Nationwide rent is going up 5.3% which has been the highest rate in 6 years. Renters are being squeezed with higher energy prices and moderate growth wage. The driving forces behind the hikes is:

• Job Growth, with 4 million new jobs generated has caused need for rentals.
• Rising Home Prices, have increased 12 time higher than rent and has forced people to rent instead of buy a home.
• Condo Conversions, with the increase of conversion have kicked renters out and causing a shortage of apartments and construction being down.
• Hurricane Katrina, had many renters that are still displaced which has put additional pressure on rentals through the country.

Orlando Real Estate Agent Outlook

With highest volume of homes on the market, and slower market, top Orlando Real Estate Executive warned real estate agents maybe in shock with a soften market. Orlando has over 11,000 real estate agents with 86% being in the Real Estate industry less than 10 years. And during the past year the Orlando Realtor Association increased to 26% to 11,897 people. Jennings stated marginal agents will retire faster and consilidation within the industry will continue. The big office will be bigger and the smaller offices will do fine, squeezing out the middle sized offices. In addition, there will be no housing bubble as Orlando still has a demand housing and jobs are being created. Courtesy of Orlando Sentinel 5/27/06.

Status of Home Sales

While resale single family homes and condos sales dropped 2% in nationwide. Orlando home sales have gained 7% since last year. Nationwide inventory rose to 3.38 million units record high representing signs of cooling off from the red hot housing market. Mortgage rates are expected to rise to 7% by the end of the year.

Horizon West Gaining More Land

Disney is selling 349 acre parcel to developers for the massive Horizon West community to be built west Orange county. This also includes 60 acres reserved for a new High School of the Horizon West community. Disney still owns 30,000 acreas in and around Disney. Disney stated the are selling this land as it is not an integral part of its core entertainment business.

Toll Brothers Orders Fall

Toll Brothers the nations luxury home builder saw 3% profit for first quarter results, but the number of future orders is slim. Orders fell by 29% this quarter to the tune of $1.56 billion. The greatest decline has been experienced in Mid-Atlantic states such as Pennsylvania, Delaware, Maryland and Virgina. The CEO indicates the demand has not disappeared but people are waiting on the side lines for a deal and predict buyers will come back to the market once homes built on speculation are reduced. The average home in recent months are priced at $679K and expected to increase to $700K in fourth quarter 2006. This company entered the Orlando market in mid 2005 when it acquired Landstar homes Central Division. Courtesy of Orlando Sentinel 5/24/06.

New Home Construction 516% Increase to Impact Fees

Impact fees may make a real impact on New Construction Home prices in Orlando, Florida. Impact fees are charged to a new home builder for to maintain/build roads, and schools are the biggies. New home builders pass this charge along/share cost to buyers that want to build a new home and usually added to a buyers closing costs. Impacts also effect retail building etc. Impact fees in Orange County have not been raised since 1996. As a result of rise in the cost of land, concrete and steel and the need to build a better infrastructure to accomodate growth, has created the need to increase impact fees. The county is proposing to increase fees from $12,800 to 18,947 which represent a 516 % increase. This will make resale homes a a less expense option for homebuyers. This proposal coming at a time in which the counties are looking a ways to create more affordable housing for residents.

SoDo Development Downtown Orlando

New housing and business complex on the edge of downtown Orlando has been approved by Municipal Planning Committee, but yet to be approved by City Council. Once approval continues this will be called SoDo, named similarly to SoHo in New York City. The complex will be on the corner of Grant Street and South Orange Avenue built upon 22 acres. This host 330 luxury condos, Target, commericial and retail space. We will keep you posted to the outcome. Courtesy of Orlando Sentinel 5/17/06.

SoDo Development Downtown Orlando

New housing and business complex on the edge of downtown Orlando has been approved by Municipal Planning Committee, but yet to be approved by City Council. Once approval continues this will be called SoDo, named similarly to SoHo in New York City. The complex will be on the corner of Grant Street and South Orange Avenue built upon 22 acres. This host 330 luxury condos, Target, commericial and retail space. We will keep you posted to the outcome. Courtesy of Orlando Sentinel 5/17/06.

203(K) Renovation Loan

203(k) loan will allow you to obtain a loan for your home and obtain additional loan money for repairs. There are two types of traditional and streamlined.

1) Traditional will only allow rehab work on non-cosmetic repairs. Repairs would include, roof, carpeting, electrical, a/c etc. and repairs have to be a minmum of $5000K. There is no limit on amount borrrowed but has to a loan to value ratio compatible with other properties in the neighborhood. Inspector has to review completed work before contractor becomes paid.
2) Streamlined does allow for some cosmetic work to be repaired, has no minimum dollar amount required, allows more flexibility with payment to contractors, but does cap the loan amount to $35K.

You need to start repairs within 30 days of closing and to be completed within 6 months. To find a HUD approved lender for 203(k) loans. You may visit http://www.hud.gov/ll/code/llplcrit.html or call 1-800-225-5342. Courtesy of Orlando Sentinel 5/14/06.

Affordable Housing Issue in Orlando

Buyers in middle class are struggling to have ownership as prices have rose in past couple of years that have priced middle class home ownership. Buyers who say their combined income of $75K is still not enough for find home ownership. Even condos can eliminate home ownershio after condo fees are added. The median price of household income rose 16% since 2000 and median price of a home rose 138%. The affordability problem is being faced by major employers in the Central Florida Region such as Progress Engery, Public Schools, and Disney who say the housing affordiability problem and damped recruitment. People do not want to have long commutes from areas outside Orlando that offer more affordable housing. One option from affordablility expert is to build greater density in which homes are built up, offering shorter commutes. Courtesy of Orlando Sentinel 5/14/06.

Logic for Buyers Market

BUYERS MARKET: THE RIGHT APPROACH
Homebuyers are getting the big breaks in an increasing number of U.S. markets, says Tom Early, president of the National Association of Exclusive Buyers Agents. But even as the market shifts to favor buyers, to get the best deal, buyers should take the right approach.Some advice from Early:
• Tell your buyers to stifle the guilt. Remind them, if the shoe wereon the other foot, the seller would show no mercy.
• Be patient. In slow-moving markets, it is sometimes a good bet to simply wait until a seller sees the light and drops his price.
• When a seller drops the price, it may be a signal that he is facinga deadline and will negotiate still more.
• Take advantage of a buyer’s right to a home inspection. The buyermay find an issue that can be used to his advantage in gainingconcessions.
• Insults don’t work. Wounding the sellers’ pride in their home is nevera good tactic.
• Also, making a ridiculously below-market bid may shock the owners into refusing to talk anymore.Source: The Miami Herald, Ellen James Martin (05/07/2006)

Downtown Orlando Entertainment Venues Revamped

Read how your Orlando tax dollars are working on city changes. City of Orlando is moving forward on a $200,000 planning project to revamp entertainment venues in Downtown Orlando. City Council and Mayor saw this as a "generational opportunity" which will shape the downtown Orlando for decades. Their proposal is to integrate the performing arts center, replace the TD Waterhouse Centre, and renovate the Citrus Bowl. This integration will include shopping and dining around these venues that do not exist today. The project is expected to cost $850 to $900 million. This will be funded by the city, development fees, and private contributors such as Orlando Magic. There is still discussion of spending money in the special tax district of Parramore. The proposal should completed in July. Courtesy of Orlando Sentinel 5/9/06.

Orlando Apartment Shortage

The number of vacant apartments shrank to 5,041 the lowest since 1998 according to a March survey. It is common to be on 3 month waiting list. This is due to the 7,700 condo conversion already developed and there are signs the trend will continue. Another problem contributing to the shortage is the lack of new construction of the apartments, with rising costs, zoning restriction, causing short supply. Historically rents rise 3 to 4 percent per year, but rent is expected to rise up 10 percent in the next few years. This lack of supply also contributes to the affordable housing for people.

Affordability of Orlando Real Estate

Orlando has, as well as the rest of the nation experienced problems with housing affordability. Many people are finding themselves locked out of the real estate market. Especially for middle class such as teachers, firefighters, police officers, teachers, service workers, and colleges graduates. The mayor Richard Crotty announced a task force to tackle the housing affordability. The average family income is $57,400 while the average home price is $259,700. Broward county with average home price is $400,000 is urging Orlando to tackle this problem as soon as possible. In Broward developers cannot afford to build apartment because land is so expensive. Courtesy of Orlando Sentinel 5/6/06.

Advantages of Home Ownership

• To deduct property taxes and the interest paid on your mortgage, you must itemize deductions rather than take the standard deduction. For many homeowners, the combined deductions for mortgage interest and property taxes easily exceed the standard deduction.
• Freedom to live the way you want to. You can customize your home without having to worry about the landlord’s rules.
• You can accumulate home equity. You can borrow against the equity built up in your home to finance necessities such as a college education, vacation, new car, etc. Since the interest on a mortgage is usually low, borrowing money against your home can be very sound. The interest on home equity loans is usually tax deductible, too.
• Stable monthly payments rather than rent payments which typically increase each year. The principal and interest portion of most mortgage payments remains unchanged for the entire repayment period so you know exactly what you’ll need in the way of finances.
  Home improvements that may increase the value of your home. And your home improvement costs may be used to reduce your capital gains tax when you sell.
• Houses typically increase in value over time. Courtesy of National Association of Realtors

New 50 Year Loan in California

Would you own your home for 50 years and expect to pay it off? California the first state to offer the supersize loan. Yes, a 50 year loan and has drawn alot of phone calls. This is an alternative to the interest only or ARM loans as payments are lower and payments will be applied to principal, as opposed to interest only loans carry negative amortization. The 50 year loan has its critics, while it will offer lower payments than an interest only loan, it will cost more in interest than a typical 30 year loan, by tacking on 2 more decades of interest. This has been attractive to buyers in California because many people are buying too much of home, with half the homes costing over $500,000. This maybe an alternative for you to keep payments as low as possible. Courtesy of PlanetRealtor.com

Orlando Condo Hotels Third Largest

Orlando is the third largest condo hotel market in the nation. Because of all the condo hotels being built nationwide a new website called www.nacho.us was launched Monday to capture the condo hotel market for consumers giving them market conditions, property ratings, and calculator to learn about expenses associated with a hotel's rental management. Courtesy of Orlando Sentinel 5/2/06.

Downtown Orlando Free Wi-Fi Acess

Downtown Orlando will be offering free Wi-Fi in the 9 square miles of the city and installation will begin in 5/06 with a 6 month completion time. You will be able to order a pizza or look up movie tickets through advertisement venues. This is start of offering Orlando Downtown as a progressive city with much to offer along with all the other amenties in the luxury condominiums. If you would like broadband service, this will cost users an additional expense. You will be able to sit in the park, restaurant, home or condo and use the wireless capabilities.
Courtesy of Orlando Sentinel 4/29/06.