Archive for the 'Tampa Home Buyer Tips' Category

MLS Market Snapshot Shows Tampa Real Estate Market Conditions

April 30th, 2008 categories: Tampa Market Conditions, Tips for Sellers, Tampa Home Buyer Tips

Do you see the Market Snapshot form over there in the right hand column? The Market Snapshot is a great tool for Tampa home buyers or sellers to keep tabs on what’s for sale, and on what’s selling in any Tampa neighborhood. And what’s best about this tool is that it automatically sends you an updated report every six weeks, or for whatever time period you select.

The report, sent by e-mail, shows active listings, recent sales, asking prices vs. selling prices, and other data that help Tampa home buyers and sellers understand the local market. You can select a zip code, or better yet, click the zip code lookup and just just select a spot on the map in which to center your reports.

The data we use on the Market Snapshot is imported directly from the Mid-Florida Regional MLS, the database of all brokered listings and sales. Good stuff. Give it a try, or, contact us and we’d be happy to set it up for you and answer any questions about the market, your home’s value, specific neighborhoods, etc.

Posted by Lenny Gurvich | No Comments »

Short Sales and Phantom Numbers

April 29th, 2008 categories: Tampa Real Estate, Tampa MLS, Tampa Market Conditions, Short Sale Information, Tampa Home Buyer Tips

By now many Tampa home buyers are aware that purchasing a pre-foreclosure property is not all that easy. Short sales, or short listings, as they should really be referred to, are abundant across the Tampa Bay area. A short sale listing is a home for sale for which the listed price will not be adequate to cover the seller’s loan payoff(s) and other related costs of selling.

Once it is obvious that the seller can no longer make payments and is facing foreclosure, most sellers will begin dropping the listed price of the home to find the sweet-spot (a moving target these days), the price in which a buyer sees value and finally makes an offer. I call it the phantom number, because that’s really what it is. For many short listings, it has nothing to do with the market value of the home. It’s simply a number dropped low enough to entice a would be buyer to make an offer (market value?). The seller signs off on the offer and presents it to the note holder, and pleads a hardship case. The bank, or holder of the note, solicits an independent opinion of value, and makes a decision to either approve the sale, or counter the buyer’s offer with a higher number.

Quite often the bank comes back with a number that was much higher than the listed price or, phantom number. The bank has to consider many factors, including estimated market value, payoff on the loan, the costs involved in the sale, etc. The bank, in trying to mitigate its losses, will attempt to get the highest price possible.

So many would-be buyers are getting frustrated by waiting months for third party approval, only to find out the bank wants an even higher price than what was listed. The phantom number effect. A disclosed bait and switch? Is it fair to list a home for sale at a short number without first getting the bank’s approval? Banks most likely don’t want to approve any number until an offer is presented and a clearer picture of the market is available. Sure, the fact that the listed price will be short has to be disclosed. Our MLS requires certain language be included on the listing:

Listing price may not be sufficient to cover all encumbrances, closing costs, or other seller charges and sale of Property at full listing price may be conditioned upon approval of third parties. Call for details.

And there’s also a disclosure for buyers to sign that includes the language:

1. You may not simply “walk away” from a contract which is subject to lender or third party approval - you will become obligated to perform under the contract from the date of its execution until the lender or third party disapproves the contract or a term in the contract permits either the seller or buyer to terminate.
The lender or third party is under no obligation to consider, respond to, approve, or disapprove your contract within any specified period of time.
It is possible the lender may elect not to approve the contract, in which event you will not be able to buy the property at the listing or contract price.
At the time the seller enters into the contract with you, the seller may not have been informed by the lender:
(a) what an acceptable purchase price may be, or
(b) that the lender would participate in or consider a potential Short Sale offer.

So buyers beware. That number may look great, but chances are you’ll not even get a response, much less approval. Every situation is different. Some lenders respond quickly, some short listing prices have already been approved. But the fact is, lenders would rather not have to foreclose on the property and attempt to auction it if they think they can do better by letting the borrower sell it short. Short sales are being approved. Let’s face it, market values have declined. So anyone who purchased near the top of the market in 2005-2006, and did not put 20% or more down, is most likely upside down. Likewise, anyone who refinanced in that time period, and tapped out their equity, most likely owes more than it’s worth.

So understanding the circumstances, the processes, and the fact that the list price is just a phantom number, can go a long way in reducing the frustration factor for would-be short sale buyers.

Did you know?

There are 707 MLS listings tagged as “Pre-Foreclosure” in the City of Tampa (as I type).

Posted by Lenny Gurvich | 1 Comment »

It’s Gonna Cost Me What?!

March 18th, 2008 categories: Tampa Real Estate, Mortgage Rate Watch, Tampa Home Buyer Tips

For most folks, a monthly mortgage payment is made up of 4 components:

1. Principal on the loan.
2. Interest on the loan
3. Taxes (property)
4. Insurance (hazard, flood, etc)

Those 4 components are commonly referred to as PITI. I commonly run in to folks who are grossly underestimating their monthly nut on a specific loan amount.

There’s no better way to get an accurate estimate on your monthly payment than by speaking with a mortgage loan professional. However, if you want to give it a go yourself, here’s how to do it:

1. Assuming you know how much you’ll be borrowing (I know, that’s a big assumption.), go to my mortgage loan calculator (go there), and plug in the loan amount and the interest rate, and the loan term. This will give you the P and I components of your monthly nut.
2. Next, go to the property appraiser’s tax estimator (go there) and fill in the info. Make sure to select a millage rate. All City of Tampa millage rates are pretty close, so if you don’t know your code, select any Tampa code. Then select either Yes or No for the homestead exemption. Only your primary property qualifies for homesteading. The estimator will spit out a range of estimated taxes. Pick a number near the middle of the range. This is the T component of your monthly mortgage payment.
3. Now all that’s left is the I component, the insurance. Place a quick call your favorite insurer and get an estimate of what it will cost to insure your perfect home.
4. Add it all up and there you go, a pretty accurate estimate of your monthly payment!

Posted by Lenny Gurvich | No Comments »

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