Call Traditions Realty for an update of current market trends in your area.  With a full service agency offering property management, we can educate you on the rise in rental prices and availability of investment property.  You need to know what renters want and what they will pay preium prices to lease.  Just as important, you need to know what they don’t want and what areas tend to have longer vacancy periods.  Traditions Realty can put you in touch with an agent with a vested interest in your success.  Read more below.     

Three housing trends emerging this spring

WASHINGTON – April 30, 2012 – What can homebuyers expect to face this selling season? An improving housing market has made it a different picture in many areas compared to recent years, housing experts say. Bankrate.com notes the following trends:

1. Fierce competition.
Housing affordability is at a record high due to falling home values and mortgage rates near record lows. More buyers are jumping off the sidelines. At the same time, investors are snapping up bargain prices, often in all-cash deals, and competing with traditional homebuyers.  Add in a sinking inventory of homes for sale, and the competition is getting fiercer.

“Rents are going up, and as long as there are properties at the level where investors can get positive cash flow, they will continue to invest,” says Jed Smith, managing director of quantitative research for the National Association of Realtors®. Smith adds that first-time homebuyers, in particular, may find increased competition from investors in trying to snag some of the best deals on the market.

2. More renters show desire to become homeowners.
Recent surveys show that buying a home now is more affordable than renting. As such, more renters are finding homeownership more enticing.

The signs are already starting to show: About 59.5 percent of tenants recently surveyed by Kingsley Associates say they intend to renew their leases this year, which is the lowest rate since early 2009.

3. Mortgages may be a little pricier.
Fannie Mae, Freddie Mac and the Federal Housing Administration recently raised their loan fees, which means homebuyers can expect to pay a little more for their mortgage this spring.

“Those who don’t have credit scores in the high 600s to low 700s may be forced to go the FHA route,” says Ed Conarchy, a mortgage planner at Cherry Creek Mortgage in Gurnee, Ill. “And they will be stuck with the higher fees.”

Buyers with smaller downpayments can expect to pay more for FHA mortgage insurance premiums, which have risen to 1.75 percent of the loan total. Bankrate.com cites an example illustrating the higher fees: A borrower who takes out a $200,000 FHA loan will likely have to pay about $3,500 for mortgage insurance upfront. Prior to the increase taking effect, borrowers would pay about $2,000 for that same loan amount.

Borrowers with higher mortgages can expect higher fees too. The FHA announced that in June it would increase its annual insurance for mortgages more than $625,500. “A borrower who lives in a high-cost area and takes out the maximum $729,750 (which is the FHA limit for high-cost areas) will pay $912 each month in mortgage insurance alone,” Bankrate.com reports.

Source: “5 Mortgage and Housing Trends in Spring 2012,” Bankrate.com (April 21, 2012)

© Copyright 2012 INFORMATION, INC. Bethesda, MD (301) 215-4688

Looking for a new home town, Jacksonville Florida, may be the place for you.  Want to try it out without making the plunge right away?  Traditions Realty can help.  With a full service agency offering property management and sales, we can put you in a place temporarily and let you get to know your new digs before you commit.  Want to jump into the market and take advantage of the low interest rates and all time low prices for homes?  We can help you find that beach condo, historic bungalow, or river front estate.  Read more below.  

By Jonathan Hollis, Special Correspondent for Pop Candy

I know what you’re thinking: Jacksonville? Isn’t that hot, swampy sprawl in southern Georgia?

Well, I’ve lived in many places, and you know what? I’m always more than psyched to spend time in my hometown of Jacksonville. For me, the River City has a gravitational pull that’s more than just a sentimental connection — it has a charm all its own.

Here are seven reasons why:

1. Water /nature/outdoor activities — If you like water, you’ll like Jacksonville. The heart of the city is located on the St. Johns River, where you’ll find all sorts of recreational waterway traffic and activity. One of my favorite pastimes is cruising on the river near downtown Jacksonville at night and taking in the views of the illuminated cityscape.

The downtown area of Jacksonville, Fla., on the banks of the St. Johns River.

CAPTION

By Deborah Yovanovich, USA TODAY

Heading east, you’ll run into a stretch of the Intracoastal Waterway, a truly unique piece of aquatic and ecological beauty. However, if you find the river and Intracoastal too confining, you’re just a short drive away from the vast expanse of the Atlantic Ocean, which can be accessed from several delightful, laid-back beach communities along the First Coast.

The beaches also have many thriving nightlife venues: In Jacksonville Beach, grab a cocktail at Casa Marina Inn and Restaurant, hear some rock ‘n’ roll at Freebird Liveor karaoke at the dive-y Mango’s Beach Bar and Grille. In Atlantic Beach, sample some microbrews at Ragtime Tavern, and in Neptune Beach, drink on the oceanfront at Lemon Bar.

As you can imagine, the abundance of surrounding waters makes Jacksonville a fantastic fishing destination. Inshore or offshore, there are plenty of spots where you can cast a line and contemplate the meaning of life — or consume a 12-pack of beer. If you want to reach relaxation nirvana — and watch other people fish — Jacksonville hosts the AT&T Greater Jacksonville Kingfish Tournament in July and the Jacksonville Kayak Fishing Classic every May.

If you’re looking to stay dry, there’s still plenty to do outside. Jacksonville’s urban park system is the largest in the country, with more than 111,600 acres. Go for a refreshing run on one of the trails in the 46,000-acre Timucuan Ecological and Historic Preserve, explore the exhilarating bike routes in Kathryn Abbey Hanna Park, or sleep under the stars at one of the waterfront campsites in Huguenot Memorial Park. And if your encounters with interesting creatures leave you wanting for more, consider making a trip to the Jacksonville Zoo and Gardens.

Finally, all golf enthusiasts should have Jacksonville on their radars, as there are more than 70 public and private courses in the area. Also, the Tournament Players Club at Sawgrassin nearby Ponte Vedra Beach is the site of the PGA Tour headquarters and hosts the Players Championship in May.

2. Sports — Golf and fishing aren’t the only sports Jacksonvillians are into. The city currently has six professional and semi-professional teams, including the NFL’s Jacksonville Jaguars, the Arena Football League’s Jacksonville Sharks and the American Basketball Association’s Jacksonville Giants. Additionally, the Jacksonville Bullies, a professional indoor lacrosse team, plans to begin playing this fall.

Jacksonville also hosts two notable collegiate football events every year. The annual Florida-Georgia game is played at EverBank Field in October; the game-day revelry is known as “The World’s Largest Outdoor Cocktail Party.” EverBank Field also is the site of the Gator Bowl, which is played on or around New Year’s Day.

3. Music — While it’s certainly no New York or Nashville, Jacksonville sports a vibrant music scene. A few legends spent time or got their start here: Ray Charlestickled the ivories in the LaVilla neighborhood early in his career, Southern rock groups The Allman Brothers Band, Lynyrd Skynyrd and Molly Hatchet all originated here and guitarist Derek Truckshails from Jax.

A number of contemporary punk and rock acts also call Jacksonville home, including Yellowcard, Limp Bizkit, Shinedown and Red Jumpsuit Apparatus. And three Miami bass (or “booty music”) outfits are from here: Quad City DJ’s, 95 South and 69 Boyz (Tootsee Roll).

Jacksonville has several great performance venues and consistently attracts high-profile artists. This April alone will see Van Halen, Gwar and Elvis Costello, along with the Welcome to Rockville festival featuring Korn, Shinedown, Evanescence and others.

4. Downtown — After leaving the airport, one of the first areas you’ll hit is downtown Jacksonville. Here, you’ll find unique cultural fare, such as the First Wednesday Art Walk, a celebration of local artists, musicians, museums, bars and restaurants that takes place on the first Wednesday of every month.

You’ll also more find more traditional fine art staples, such as the Jacksonville Symphony Orchestra and the Museum of Contemporary Art. Along the riverfront, the Jacksonville Landing is a hub of shops, eateries and live entertainment, as well as a spot where you can board a water taxi for a relaxing jaunt on the St. Johns. At night, you can get your hipster bar fix at Club TSI or Dos Gatos, rub elbows with young professionals at the upscale Mark’s club/lounge, or get your line dance on at Maverick’s Rock N’ Honky Tonk.

5. Riverside — Just south of Downtown on the west side of the St. Johns is Riverside, which is perhaps Jacksonville’s edgiest locale. In 2010 the American Planning Association designated the larger Riverside-Avondale area one of the year’s Top 10 neighborhoods, an honor that also has been bestowed on Park Slope in Brooklyn, N.Y. and Pike Place Market in Seattle.

In Riverside, you’ll find elegant residential architecture, numerous parks and a distinct eclectic feel. A mix of bars, boutique shops and cafes makes up the streets of Riverside’s historic Five Points district. Stop by Cozy Tea, a lovely place that serves tea, sandwiches and fine goodies, or grab a drink at O’Brothers Irish Pub. During the day, visit the Cummer Museum of Art and Gardens. On Saturdays, stop by the Riverside Arts Market, a weekly cultural festival featuring arts, crafts, music and food.

Over the last few years, the King Street District has become one of the city’s premier nighttime alt-destinations. A cluster of trendy, well-managed establishments, including Kickbacks Gastropub and The Loft, has transformed the area into a hip, happening scene that has something to offer just about everyone.

6. San Marco Square — On the opposite side of the St. Johns from Riverside is the gorgeous San Marco Square, a pleasant district comprising eateries, shops, bookstores, lounges and theaters. Works of art appear in a number of spots, and toward the center of the square, you’ll find a quaint, tree-lined park with a bandstand, fountains and benches.

Be sure to see a movie at the Art Deco San Marco Theatre, an old-fashioned film house. After the movie, you can head down to Square One, a two-story bar and lounge that often features live entertainment, including the occasional burlesque performance. There’s also Laylas, a Middle Eastern hookah bar, and The Grotto, where you can decompress with a glass of wine.

7. St. Johns Town Center — The St. Johns Town Center is Jacksonville’s massive outdoor retail mecca. This large open-air mall features such big-name anchor stores as Barnes & Noble and Best Buy, as well as Apple, Betsey Johnson and Louis Vuitton. It’s the perfect place to knock out some shopping and soak up some Florida sun.

The Town Center opened in 2005 and now has apartments, hotels and a number of high-end restaurants. As for the nightlife, patrons experience a blend of rock, dance and country vibes at Whisky River (where they can also ride a mechanical bull). BlackFinn offers more of a traditional drink-and-chat atmosphere, and Suite’s is the place if you want to don your finest Friday-night threads and swagger about with classy drink in hand.

J.D. Hollis is a Jacksonville native and writer for TheSportSpin and music website Atlas Rocked.

A good way to ensure that prospective Jacksonville real estate buyers will make you offers that come close to your asking price is to properly price your property. Traditions Realty’s agents are well-versed in local real estate and can help buyers and sellers judge market value of property. Traditions offers a full line of services to clients looking for Jacksonville homes for rent as well as properties for sale.  Our agents can help you with all of your real estate needs, and with the market showing such strong signs of improvement, now is a wonderful time to get started!  Read more below.

Low-ball offers don’t work anymore

WASHINGTON – April 23, 2012 – When the number of home sellers grossly outpaces the number of buyers, no offer can be ignored, even if it’s 25 percent or more off the asking price. But in today’s rebounding market, those low-ball offers don’t often work. Many times, the potential buyer finds that they don’t get a counter-offer. And, in many cases, another more realistic buyer gets the home.

A low-ball offer – generally 25 or more off the asking price – allows buyers to see if they can land a great deal, even if they’re willing to pay more. In a survey last year conducted by the National Association of Realtors® (NAR), one in 10 respondents cited low-ball offers as a concern. According to real estate columnist Kenneth Harney, a NAR survey conducted in March and not yet released found that almost no one complained about low offers.

When the number of listings outpaced the number of buyers, many potential homeowners submitted a shockingly low offer on the theory that they had nothing to lose. If the seller balked, most would still counter with something below their asking price. Today, however, offers close to the asking price – or even beating it – will probably come in fairly quickly from someone else if a home is priced correctly in the first place.

Even buyers who still want to low-ball an offer on a home many times switch tactics after they lose a property or two to a more aggressive buyer.

Florida Realtor Marnie Matarese works with J Wood Realty in Sarasota. She told Harney that fewer buyers want to low-ball an offer in her area, but they still come in – mainly from out-of-state or out-of-the-country people who have read about the state’s foreclosures and short sales. That news, however, is old – it has not kept up with reality in many areas.

Matarese says some people still insist on making a low-ball offer, but that she doesn’t mind. “You can’t blame a buyer for trying to get a good deal,” she says.

In some cases, a seller isn’t offended by a low-ball offer, but their counter-offer shaves only a little bit off their original asking price. An Olympia, Wash., real estate agent had a $150,000 offer for a $250,000 listing, according to Harney. But after the dust settled and the seller shook off his irritation, he and the buyer agreed to $230,000.

Harney closed his column with this advice: “Rolling low-balls at sellers may have been an effective approach between 2008 and early 2011. But in 2012’s environment – at least in rebounding markets – it could be counterproductive if you truly want to buy.”

Source: Ken Harney. Distributed by Washington Post Writers Group.

© 2012 Florida Realtors®

Want to get in before the spike in prices.  Call Traditions Realty to find bungalows for sale in the area.  Located in the 5 Points area, this is our hood and we can provide the expert advice needed for the purchase of your new home.  Interest rates and market prices are low now but “the times they are a changin”.  Read more below.

Update: Kickbacks Expansion

The construction project planned for 914 King Street has evolved considerably since the owners of Kickbacks first discussed it with RAPin May, 2011. What was initially proposed as a single-story, 150-seat addition to the existing Kickbacks establishment (to include a much-needed kitchen expansion) is now a new three-story, 11,407 square foot, 249 seat bar/restaurant to be called Goozlepipe & Guttyworks. (Of the proposed square footage, 10,551 s.f. is conditioned space, and includes dining and bar space, in addition to kitchen, storage and office space.)

The new restaurant will share kitchen, storage, bar and office space with the existing Kickbacks Gastropub. Although patrons and staff will be able to move freely from one establishment to the other through internal doorways, the menus will be different and the establishments will operate under separate liquor licenses. The new restaurant also will feature a “Belgium Bar” and an extensive patio that includes covered outdoor seating, a full-liquor bar, multiple TVs and a fireplace.

RAP’s Appeal

The existing Kickbacks restaurant has 170 seats and is not required to provide any on-or off-site parking because it is located in a historically contributing structure. Plans call for Goozlepipe & Guttyworks to have 249 seats; since its building is new construction, it is not eligible under the Riverside Avondale Zoning Overlayfor the same zero parking benefit. Per City code, the number of seats in a restaurant determines how many parking spaces the restaurant is required to provide for its patrons. Based on its proposed number of seats, Goozlepipe & Guttyworks is required to provide 33 parking spaces. The project’s developers applied for an Adminstrative Deviation to reduce the number of required spaces to zero, and a Zoning Exception that would allow them to have outdoor sales and service of liquor and beer. The Planning Commission granted the waiver and RAP is appealing this decision. RAP is asking the developers to reduce the number of bar/restaurant seats and/or provide the required parking per the Zoning Overlay. We have also requested that they take measures to ensure peaceful outdoor sales and service of alcohol. We remain hopeful that a compromise can be reached.

Information about RAP’s Motion to Consolidate

The developers’ original application, now on appeal before the Land Use and Zoning Committee, asked for a waiver to reduce required parking from 19 spaces to zero. Because of a Planning Department error in calculating the number of spaces required by the Overlay, the developers have filed a new administrative application to reduce the number of required parking spaces from 33 to zero. RAP has filed a legal motion to combine the two applications because the applicants are asking for the same end result (zero parking requirements), and will end up with two final orders, possibly with different outcomes, if allowed to proceed.

Progress and Precedent

There has been considerable public debate about this proposed development and RAP’s appeal. We are concerned that the the real issue here—a legitimate capacity problem that has significant broader consequences for the district because of the legal precedent the parking deviation creates—is being obscured by genuine affection for one of our neighborhood’s most popular establishments.

To be clear, RAPis not attempting to stop the owners of Kickbacks from building a new restaurant. Indeed, we welcome an appropriately scaled dining establishment on the site Kickbacks has proposed. We merely want this new business (and all district businesses) to abide by the requirements of the Riverside Avondale Zoning Overlay, which was designed to support neighborhood-scale development and the rehabilitation of contributing historical structures. We believe the Planning Department’s waiver of parking requirements for this application subverts the Overlay, and creates a damaging precedent for granting comparable zero-parking deviations to each eligible non-contributing commercial property in the historic district.

District Merchants and RAP’s Appeal

All three local Merchants Associations—5 Points, Avondale, and Park & King—are on record as publicy supporting RAP’s appeal of the Planning Department’s decision. Their position statements can be found here.

At Traditions, we can help you realize all of your Jacksonville real estate goals, whether they include buying, selling or renting property. Traditions agents are knowledgeable about local investment properties and are capable of assisting you in every part of the process. Investors buying properties lately have been waiting several years before reselling them, rather than flipping them right away. Renting out an investment property can be a good way to maximize its profit potential. We offer a full line of property management services and are experts in Jacksonville homes for rent.  Read more below.
 
NAR: Investment, vacation home sales up in 2011
WASHINGTON – March 29, 2012 – Sales of investment and vacation homes jumped in 2011, with the combined market share rising to the highest level since 2005, according to the National Association of Realtors® (NAR).

NAR’s 2012 Investment and Vacation Home Buyers Survey, covering existing- and new-home transactions in 2011, shows investment-home sales surged 64.5 percent to 1.23 million last year from 749,000 in 2010. Vacation-home sales rose 7.0 percent to 502,000 in 2011 from 469,000 in 2010. Owner-occupied purchases fell 15.5 percent to 2.78 million.

Vacation-home sales accounted for 11 percent of all transactions last year, up from 10 percent in 2010, while the portion of investment sales jumped to 27 percent in 2011 from 17 percent in 2010.

NAR Chief Economist Lawrence Yun said investors with cash took advantage of market conditions in 2011. “During the past year investors have been swooping into the market to take advantage of bargain home prices,” he said. “Rising rental income easily beat cash sitting in banks as an added inducement. In addition, 41 percent of investment buyers purchased more than one property.”

Yun said the shift in investment buyer patterns in 2011 shows the market, for the large part, is able to absorb foreclosures hitting the market.

“Small-time investors are helping the market heal since REO (bank real estate owned) inventory is not lingering for an extended period,” he said. “Any government program to sell REO inventory in bulk to large institutional companies should be limited to small geographic areas. Even where alternatives are needed, it’s best to rely on the expertise of local businesses, nonprofit organizations and government.”

All-cash purchases have become fairly common in the investment- and vacation-home market during recent years: 49 percent of investment buyers paid cash in 2011, as did 42 percent of vacation-home buyers. Half of all investment home purchases in 2011 were distressed homes, as were 39 percent of vacation homes.

“Clearly we’re looking at investors with financial resources who see real estate as a good investment and who aren’t hesitant to use cash,” Yun said. Of buyers who financed their purchase with a mortgage, large downpayments were typical. The median downpayment for both investment- and vacation-home buyers in 2011 was 27 percent.

“Given the tight credit in recent years, many would-be normal home buyers for owner occupancy declined,” Yun said.

The median investment-home price was $100,000 in 2011, up 6.4 percent from $94,000 in 2010, while the median vacation-home price was $121,300, down 19.1 percent from $150,000 in 2010.

Investment-home buyers in 2011 had a median age of 50, earned $86,100 and bought a home that was relatively close to their primary residence – a median distance of 25 miles, although 30 percent were more than 100 miles away.

“The share of investment buyers who flipped property remained low in 2011, and many of those homes likely were renovated before reselling,” Yun said. Five percent of homes purchased by investment buyers last year have already been resold, up from 2 percent in 2010. The typical investment buyer plans to hold the property for a median of 5 years, down from 10 years for buyers in 2010.

The typical vacation-home buyer was 50 years old, had a median household income of $88,600 and purchased a property that was a median distance of 305 miles from the primary residence; 35 percent of vacation homes were within 100 miles and 37 percent were more than 500 miles. Buyers plan to own their recreational property for a median of 10 years.

Lifestyle factors have consistently been the primary motivation for vacation-home buyers, while the desire for rental income drives investment purchases. Vacation homes purchased last year were more likely to be in suburban or rural areas; investment homes were concentrated in suburban locations.

Eighty-two percent of vacation-home buyers said the primary reason for buying was to use the property themselves for vacations, or as a family retreat. Thirty percent plan to use the property as a primary residence in the future, and only 22 percent plan to rent to others.

Half of investment buyers said they purchased primarily to generate rental income, and 34 percent wanted to diversify their investments or saw a good investment opportunity.
Sixteen percent of vacation buyers and 14 percent of investment buyers purchased the property for a family member, friend or relative to use. In many cases the home is intended for a son or daughter to use while attending school.

Forty-two percent of vacation homes purchased last year were in the South, 30 percent in the West, 15 percent in the Northeast and 12 percent in the Midwest; 1 percent were located outside of the U.S.

Forty-four percent of investment properties were in the South, 23 percent in the West, 17 percent in the Midwest and 15 percent in the Northeast.

Eight out of 10 second-home buyers said it was a good time to buy. Nearly half of investment buyers said they were likely to purchase another property within two years, as did one-third of vacation-home buyers.

Currently, 42.1 million people in the U.S. are ages 50-59 – a group that has dominated second-home sales since the middle part of the past decade and established records. An additional 43.5 million people are 40-49 years old, while another 40.2 million are 30-39.

“Given that the number of people who are in their 40s is somewhat larger than the 50-somethings, the long-term demographic demand for purchasing vacation homes is favorable because these younger households are likely to enter the market as their desire for these kinds of properties grows, and individual circumstances allow,” Yun said.

NAR’s analysis of U.S. Census Bureau data shows there are 8.0 million vacation homes and 42.8 million investment units in the U.S., compared with 75.3 million owner-occupied homes.

NAR’s 2012 Investment and Vacation Home Buyers Survey, conducted in March 2012, includes answers from 2,241 usable responses about home purchases during 2011. The survey controlled for age and income, based on information from the larger 2011 NAR Profile of Home Buyers and Sellers, to limit any biases in the characteristics of respondents.

© 2012 Florida Realtors®

If you have questions or concerns about investment properties, call Traditions Realty. Conceived by real estate agents and landlords, we know investment properties and can help you to make an educated decision based on years of experience. Located in the Riverside/Avondale historic district, we are centrally located to all areas of Jacksonville. Call our office today for a consultation with one of our qualified agents.

A new breed of investors steps forward

NEW YORK – Feb. 17, 2012 – “Mom and pop investors” are trying to capitalize on a depressed real estate market in the hopes of cashing in one day.

This new breed of small-scale investors likes to buy and hold properties, as opposed to the high-dollar large investment firms that once dominated the real estate market that flipped properties quickly.

For “mom and pop investors,” the strategy is to buy homes at rock-bottom prices, rent the properties out to cover all of the costs of homeownership for several years, and then one day sell the homes when prices recover.

“An unprecedented number of investors are looking into this,” John Burns, CEO of John Burns Real Estate Consulting, told USA Today. Investors purchased more than 26 percent of single-family and condos in 167 U.S. markets in the first nine months of last year, according to data supplied by Burns.

For investors in the rental market, an 8 percent annual return is fairly normal, according to Burns. “That means that someone who buys a $100,000 property – and pays cash for it – makes $8,000 a year after expenses, including maintenance and taxes,” the USA Today article notes.

Of course, the threats of tenant and maintenance issues always has the potential to derail that potential profit, so investors need to be careful before jumping in, some experts warn.

Source: “Mom and Pop Investors Propping Up Home-Buying Market,” USA Today (Feb. 14, 2012)

© Copyright 2012 INFORMATION, INC. Bethesda, MD (301) 215-4688

Traditions Realty and their staff will be happy to assist you in purchasing residental or investment property in Jacskonville Florida.  With a large property management department, we can assist you in purchasing and manage your investment.   Read more below. 

Job  market continues its improvement

WASHINGTON – Feb. 17, 2012 – The healthier job market that’s lifted the U.S. economy in recent months shows no signs of slowing.

Applications for unemployment benefits are near a four-year low, raising expectations of further hiring gains. The news Thursday helped lift the Dow Jones industrial average to its highest close since May 2008.

More jobs and tame inflation are giving consumers more buying power. Their higher spending could further boost growth and lower the unemployment rate for February for a sixth-consecutive month.

Even the troubled housing market is benefiting. Builders expect improved sales in the near future. In response, they’re planning to break ground on more homes.

“The housing starts and unemployment claims numbers add to the belief that the economy is shifting gears,” said Joel Naroff, president of Naroff Economic Advisers. “The decline in the unemployment rate is real, and it should continue.”

A series of positive economic reports Thursday reinforced that message:

Weekly applications for unemployment benefits fell to a seasonally adjusted 348,000, the Labor Department said. That’s the lowest since March 2008. Unemployment applications have dropped 11 percent in four months.

Builders broke ground in January at a seasonally adjusted annual rate of 699,000 homes, the Commerce Department said. That nearly matches November’s three-year high. Single-family home construction cooled off slightly after a big jump in December.

Factory activity in the Philadelphia region grew in February at the fastest pace in five months, a survey by the Philadelphia Federal Reserve Bank found. That followed a report that showed a third-consecutive month of factory growth in the New York region.

Wholesale prices were largely unchanged in January, Commerce said. While gasoline prices are rising, they’ve been offset by falling costs for electricity, home heating oil and natural gas. Most economists see inflation as little threat.

Many analysts expect more good news in next month’s jobs report for February. Some say the net job gains could match or top January’s 243,000. For the past three months, the economy has gained an average of about 200,000 jobs.

© Copyright 2012 USA TODAY, a division of Gannett Co. Inc., The Associated Press.

Traditions Realty’s agents are experts on Jacksonville real estate. They are invaluable resources on Jacksonville homes for rent, buying and selling property, and property management. If housing market predictions for 2012 are accurate, now is the time to act on dreams of home ownership or investing in property. Contact Traditions today to take advantage of the current market conditions.  Read more below.

Florida’s housing sales activity higher as 2011 ends

ORLANDO, Fla. – Jan. 20, 2012 – At the close of 2011, Florida’s existing home and condominium markets reported higher sales compared to the previous year, according to the latest housing data released by Florida Realtors®. It was the third consecutive year for statewide home and condo sales activity to end the year on a positive upswing – higher year-over-year sales also were reported at the close of 2010 and 2009, records show.

Looking back on 2011, Florida’s existing home sales rose 8 percent for the year, with a total of 185,921 homes sold compared to 172,462 homes sold in 2010. The statewide existing home median price for 2011 was $131,700; it was $135,900 in 2010 for a 3 percent decrease. In Florida’s condo market, a total of 87,581 units sold statewide in 2011, a gain of 15 percent compared to 76,209 units sold in 2010. The statewide existing condo median price in 2011 was $88,300; it was $90,000 in 2010 for a 2 percent decrease.

Sixteen of Florida’s metropolitan statistical areas (MSAs) reported higher existing home sales at the close of 2011 compared to 2010; the same number of MSAs also reported higher existing condos sales.

“Florida’s economy is continuing to strengthen, which is good news,” said 2012 Florida Realtors President Summer Greene, regional manager of Better Homes and Gardens Real Estate Florida 1st in Fort Lauderdale. “Many people are hoping to take advantage of the current record low mortgage rates and affordable conditions to find their Florida dream home – but overly restrictive lending requirements continue to create barriers to homeownership for qualified homebuyers. To re-energize the housing market and the economic recovery, we need improved access to affordable financing options for qualified buyers and investors.”

In December, a total of 15,290 existing single-family homes sold statewide, a decrease of 2 percent from the 15,546 homes sold in December 2010. The statewide existing home median sales price last month was $134,300, up 1 percent from the $133,000 reported in December 2010, according to Florida Realtors’ data. The national median existing single-family home price was $165,100 in December, according to the National Association of Realtors® (NAR). The median is the midpoint; half the homes sold for more, half for less.

In the year-to-year comparison for statewide existing condo sales, a total of 6,836 units changed hands last month, compared to 6,985 condos sold in December 2010 for a decrease of 2 percent. The statewide existing condo median sales price in December was $91,900, up 4 percent from the $88,400 reported a year earlier. The national median existing condo price was $160,000 in December, according to NAR.

“Although sales were down slightly in December, they’re up strongly for the year, which reinforces the reality that Florida is in a slow real estate recovery,” said Florida Realtors Chief Economist Dr. John Tuccillo. “Our expectation is that recovery will continue through 2012. The major obstacle in the market is the inadequate accessibility to financing. Prices are moderating, but we don’t expect too much movement owing to the continuing significance of distressed properties.”

In December, the interest rate for a 30-year fixed-rate mortgage averaged 3.96 percent, down from the 4.71 percent average during the same month a year earlier, according to Freddie Mac. The annual average rate for a 30-year mortgage in 2011 was 4.45 percent. Florida Realtors’ sales figures reflect closings, which typically occur 30 to 90 days after sales contracts are written.

© 2012 Florida Realtors®

Prediction- prices of existing homes in Metro Orlando would fall 19 percent during 2011 – the biggest drop in the country.  Prediction-the median home price would be $110,500 by the end of 2011.  Good news, Orlando never saw these predictions come true.  In reaction to these dire predictions, lenders  gradually  released  distressed properties onto the market , and Floridains released an unusually small inventory of homes listed for sale.  One of the worst predictions of 2011 was the fear of the “shadow inventory” of foreclosed properties.  This blow is being softened by the low inventory of traditional listings currently on the market.  The improvment of the overall health of the market in 2012 is that banks have become better at processing short sales, which is the predominant way of selling a homes that is “underwater” or, worth less than their outstanding mortgages. In the beginning, only about 9 percent of pending short sales closed during a month’s time, but that has increased to approximately 10.5 percent.

The public becoming more aware of “the short sale process” coupled with the banks ability to close more quickly has led to a more possitive short sale experience for owner and buyer alike.  If you are considering cashing in on the great prices and low interest rates, buying a short sale may be the way to go.  Traditions Realty has certified short sale specialist on staff to answer your questions and walk you through the process.  Call today for short sale listings in your area.  Read more below. 

Fewer listings may soften blow of new REOs

NEW YORK – Jan. 9, 2012 – Forecasting the real estate market can be a perilous task.

Case in point: In May, financial services provider Fiserv Inc. projected that prices of existing homes in Metro Orlando would fall 19 percent during 2011 – the biggest drop in the country. Analysts predicted the median home price would be $110,500 by the end of the year.

But as of November, the median was virtually unchanged from a year earlier at $130,000, according to Florida Realtors.

Two factors have mitigated the earlier projections of continued price declines in residential real estate: the gradual release of distressed properties onto the market by banks, and an unusually small inventory of homes listed for sale.

If those factors continue through 2012, they could further soften the potential effect on the market of the region’s “shadow inventory” of foreclosed and repossessed houses.

“The banks really have a lot to do with where the year ends up,” said Re/Max broker David Welch. “Looking back over the last few months, they haven’t been flooding us with REOs (“real estate owned,” or repossessed, properties). It’s more of a garden hose than a wave. … We still have a lot more to go through before we are done with the foreclosure situation in Orlando, but most of them are getting absorbed.”

Buffering the effect of those foreclosed properties as they hit the market is the manageable supply of houses listed for sale. The Orlando Regional Realtor Association started 2011 with about 15,000 listings in its core market – mainly Orange and Seminole counties – but ended November with about 10,000.

Orlando’s modern-day version of a traditional neighborhood, Baldwin Park, is a good example of this shrinking inventory: As of late December, it had 28 homes listed for sale, when a community of its size would ordinarily be expected to have about 200, Welch said.

Another factor that could continue improving the overall health of the market into the coming year is that banks have become more adept at processing short sales, which have become the predominant way of selling homes that are “underwater” – that is, worth less than their outstanding loans. In the recent past, only about 9 percent of pending short sales would close during a given month, but that has now edged up to 10.5 percent, Welch said.

Banks are also now more motivated to get through the short-sale process, Welch added: One bank recently mentioned in a short-sale approval letter that it would increase the real estate commission if a particular sale closed within 30 days.

Such mitigating factors could help stabilize prices this year, though they are not likely to boost them much in areas where more than half of all mortgaged homes are underwater, according to the real estate research firm Corelogic.

John Tuccillo, chief economist for Florida Realtors, expects a gradual increase in existing-home prices for Orlando and the rest of the state through 2012.

“For the state of Florida, I think you’ll see prices begin to move upward, but not by very much,” he said recently.

The large amount of distressed housing has established a price base that, so far, has remained stable; as a result, prices will increase only marginally. In the next year, Tuccillo’s trade group plans to release a new price index for existing homes that would cover all properties within the state, and the association hopes to track same-property sales, both residential and commercial, over a 17-year period.

In the new-home market, the next year is expected to see a continuation of the gradual increases in housing starts that the metro area recorded in 2011. Prime locations, those considered A- or B-level sites, have been holding their prices and even raising them slightly, said Anthony Crocco, director of the research firm Metrostudy Inc.’s North and Central Florida divisions.

“I don’t foresee a very strong growth forecast,” said Crocco, who doesn’t expect the number of starts this year to increase more than 10 percent. “I see it being a stable year from the standpoint of it being an election year.”

While town homes and condominiums have had it the worst of all residential sectors, multifamily products make sense right now in the more urban parts of Orange and Seminole counties, rather than in some of the suburban locations where they were built in the past.

The active-adult market has been doing well and should continue to do so well into the year, Crocco said. He cited The Villages, which straddles parts of Lake, Sumter and Marion counties, and has been adding 200 new homes a month. Other locales where home construction will likely do well this year include the Lake Nona area in southeast Orlando, downtown Orlando, and areas near the University of Central Florida in east Orange County.

“Because of what’s happening with the resale market, the more we look at it you can see that there’s not going to be a slowdown in ‘12 and maybe ‘13 in the REO process, and that’s going to continue to drag the market down,” Crocco said. “But it’s a necessary step for recovery.”

One trend emerging in the region – the development and redevelopment of apartment complexes – is likely to lead in the coming year to an oversupply, Crocco said.

“There probably will be some overbuilding because that’s the only thing that’s been able to get financed, and the occupancy numbers look good,” he said. “The market needs to be aware of the amount of multifamily coming in.”

Copyright © 2012 The Orlando Sentinel (Orlando, Fla.), Mary Shanklin, The Orlando Sentinel, Fla. Distributed by MCT Information Services.

Most don’t realize there was a surprise upside to real estate investment in 2011.  Mutual funds which buy and sell shares of real estate investment trusts (REITs), out preformed the average stock mutual fund with a gain of an average 7.6 percent, vs. a 2.9 percent loss for the mutual fund.  These funds don’t invest in the physical property.  Instead they invest in malls, apartments, office buildings and hotels through investment trust that buy and sell shares.  With low mortgage rates and all time low purchase prices,  investing in apartment buildings may be the way to go for those wanting something more tangible.   The rental market is up,up, up.  Predictions are for a rise in rental rates for 2012 based on demand.

Call Traditions Realty for professional advise on all your investment needs.  With tenant placement and a property management division, we offer you as much or as little control as is comfortable.  All landlords know-a good tenant makes all the difference in the “bottom line” for  your investment.  Call us today to purchase or manage your investment.  Traditions Realty can help take the fear out of being a landlord.  Read more below.

Real estate investing lands gains

NEW YORK – Jan. 5, 2012 – Real estate had an excellent year last year. Assuming, of course, your mutual fund owned it.

In an otherwise awful year, real estate funds gained an average 7.6 percent, vs. a 2.9 percent loss for the average stock mutual fund, according to Lipper.

This may seem puzzling to homeowners: The Federal Reserve estimates that homeowners have watched $7 trillion evaporate since the housing bubble burst in 2006.

Real estate funds invest in commercial real estate and generally don’t invest in physical property. They buy and sell shares of real estate investment trusts (REITs), which invest in malls, apartments, office buildings and hotels.

By law, a REIT has to pass virtually all its earnings to shareholders in the form of dividends, one reason REITs did all right last year: The average REIT had a dividend yield of 4.83 percent in December, says the National Association of Real Estate Investment Trusts.

“Dividend yields had a big appeal in a low interest-rate environment, with 10-year Treasury yields at less than 2 percent,” says Jeffrey Kolitch, portfolio manager of Baron Real Estate fund.

Real estate aficionados like to say real estate has to go up because they’re not making any more. In today’s environment for commercial real estate, that’s fairly true. Since there’s so much supply, and lenders aren’t in a lending mood, relatively few new buildings are going up. That’s good for investors, Kolitch says, particularly those who invest in apartment buildings.

Even though house prices have fallen dramatically from their 2006 highs, and mortgage rates are low, many people are still renting – so much so that apartment owners have been able to raise rents. “People are concerned about their jobs, and don’t feel confident buying a new home,” says Steve Brown, senior portfolio manager at American Century.

Another type of REIT that’s benefiting from hard times: storage units. “REIT storage companies are benefiting as activity has picked up from foreclosures,” Baron’s Kolitch says. The storage-unit industry is changing, Kolitch says. Big companies such as Public Storage are edging out smaller mom-and-pop storage companies.

Office space REITs are still somewhat problematic, given the current high unemployment rate. Still, some REITs in areas where it’s tough to put up new buildings (New York, Boston) could fare well this year, Kolitch says. In the middle of the country (Cleveland, Chicago) job creation is modest, and there’s not much office space demand, Brown says. Nevertheless, given low interest rates and an improving economy, real estate funds may continue to give concrete returns.

© Copyright 2012 USA TODAY, a division of Gannett Co. Inc., John Waggoner.