Archive for the 'Condo Knowledge' Category
FHA ends spot approval for Condos 2-01-2010! Now financing is more important than ever! It means more buyers for your condo! If you are on the FHA list.
January 31st, 2010 categories: Condo Knowledge, Selling your Condo
The FHA spot approval process ends today. In the Metro New Orleans Market you can borrow up to $287,500 for a purchase of a condo or home used as a primary residence. The value of an FHA loan is the low down payment of 3.5% and the lower mortgage insurance fees. The interest rates are generally the same as a conventional loan. The VA loan generally follows the FHA list as well.
Most of the condos that I sell will no longer qualify for the FHA loan unless they are on the approved list. Few associations have been added to the list in the last ten years. With easy money it was not needed. Times have changed and many companies will not lend on condos unless you have 20% to put down. This will slow sales and end up decreasing values in certain segments of the condo market. This is the under 300k market.
If you live in such an association where most of the sales are under 300k you need to ask the management company and the homeowners association to look into getting you condo association to be put on the list. Its not an easy process and takes at least two months. Why Would you want your HOA to pursue this ? Read the rest of this entry »
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Your New Orleans Condo can be your second home and a place for your student to live! Two uses for the price of one!
January 17th, 2010 categories: Condo Knowledge, Second Homes
I sell quite a few condos to students going to Tulane, Loyola, LSU Medical School, Tulane Medical School, Loyola Law School, LSU Dental school and others. The same goes for young doctors doing their residences or fellowships at local hospitals. A condo offers a carefree lifestyle for the student to concentrate on their students in a safe and quiet environment. They can also double as a second home for the parents.
The Second Home Advantage- You can borrow at the same rate as you can on a primary home. At around 5% , this rate is great. The values have been stable in most of these areas for the last 4 years. You may not make anything in the short term but you are building equity month by month. Once the student is finished school you can use it as a second home.
The Condo Advantage- Your upkeep is only on the inside of your unit. The upkeep and Insurance are paid monthly in your condo fees. Your time is free to enjoy the time in New Orleans. Leaves you time to enjoy school and your studies.
Locations for Students - Most of the condos that sell to students are in the Uptown area of New Orleans along with the Warehouse District. The Warehouse Distance is a short distance to the Medical schools and all the local hospitals. Uptown along St. Charles and over to Magazine Street are also great locations for condos in prime areas. You will never spend much time commuting in these areas.
Roommates can help pay the rent- Getting a roommate can help you pay your note. There are plenty of students that would love to live in a nice condo. I cannot guarantee great roommates. However they are not hard to come by in a city where rents are high for the nicer locations and places.
New Students and Buyers come every year- When you are ready to sell there will always be some buyers. In this market you as a buyer have to know the locations and types of places that will be in demand when you are ready to sell. Its the location, condition and style that will give you the best return. Do your homework or ask me your questions!
New Orleans offers a well rounded education that students generally remember the rest of their life. Many will want to repeat that segment of their life 30-40 years later. They can do that with the condo as a second home in New Orleans as time stops. Enjoy the Class of parades. Tuition Free in the early Spring of every year.
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The time line on the $8000 tax credit ! It ends on Friday April 30th, 2010.
January 9th, 2010 categories: Condo Knowledge, Grants and Incentives
You have to close by April 30, 2010 if you want the $8000 federal tax credit. This means in essence you have to have an accepted contract on your New Orleans Home or Condo by April 1, 2010. Lets put this int0 a time line so you can get started this month. $8000 is real money!
Jan 2010- get an idea of what you are looking for in terms of price, stlye, location, bedrooms and the rest of your criteria. You cannot do this in a week so you need to start now. See a lender now so you can get the numbers out of the way. Nail down the lender as this can delay the process. Chosing someone local is the best way for success. With the various new rules in effect give yourself an extra week. Time to do your homework is now!
Feburary 2010 Search begins- Start looking so you can narrow your choices down to the best 2-3 places. Be realistic in pricing and the condition. This part of the search can take 30-40 days. You can find the best things much sooner if you do your homework. Mardi Gras and Super Bowl will knock some days out. Feburary is short being only 28 days and then minus the stuff that happens. Know how you will finance by the end of the month.
March 2010-The Chosing stage- Narrowing it down and getting ready to write the offer. You have to get an offer written and accepted in March. Its the time to get the all the details worked out. Easter will knock some days out. You have to get Inspections set up and started. The condo documents need to be read and reviewed. The lenders will have to review the condo associations books and insurances. Give an extra week if its an FHA Loan. Remember the lenders just take longer these days.
April 2010 final stages- The appraisal, loan processing, Inspections all should be wrapping up in April. Give yourself time for someone to screwup as it happens often. The title work still has to be done. The finish line is in site. If you miss the deadline for any reason then you miss the money.
The Repeat Buyers
The repeat buyers can qualify for a $6,500 tax credit if they’ve lived in their home for five consecutive years of the last eight. Repeat Buys need to understand that as long as they’re buying a new primary residence, they’re not required to sell their current home right away—or at all. In the meantime, they’re able to take advantage of today’s lower home prices and historically low interest rates.
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Selling your New Orleans Condo! Your first offer could be your Best ? History does repeat itself ! Greed is not a virtue!
December 28th, 2009 categories: Condo Knowledge, Selling your Condo
Many times the first offer you receive on your condo could be your best. A good agent will give you an asking price and a range where he expects the selling price to be. Its an educated estimate based on past sales and the present competition. It happens time and time again that this is the best offer. Sellers tend to want to try for the numbers that are not in the cards. A good agent can almost tell you ahead of time what is a good offer at that particular time.
When you list a property there is a group of people looking in that price range and need. This group will look at it as soon as they can. Most of these buyers have agents who do advise them on current pricing and the competition. When the listing hits the buyer’s agent notifies the buyers of the new listing. Many times this is thur an MLS feed that updates buyers daily as condos or homes come within the range they are looking for.
As a seller don’t let the boat leave without you! Buyers may not be on the return trip ! Houses and Condos are not like stocks and bonds that have a ready market daily. Buyers can be very unpredictable ! Expect showings to be on the upswing as we enter 2010.
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Finding the premium Condo in New Orleans! Not as many as you think?
November 6th, 2009 categories: Condo Knowledge
A client called me today looking for a two bedroom in the New Orleans Warehouse District between 240k where they generally start to the low to mid 300k price range. I told her I would send her a list for the better units. There were 16 units for sale but only three worth really mentioning that would be considered premium condos.
I am seeing this more and more as less condos are put one the market and the better condos have been selling. The inventory is not as deep as a buyers market would suggest in the sweet parts of the market. I told her she would want parking, decent views and light, high ceilings, updated kitchen and baths, and in complexes that have the better locations. I added people do not like first floor units in the Warehouse District.
Once you take the overpriced units out you were down to the two best units fairly quickly. This is quite a change in the market over the last 3 months. I did the same search type of search in the 150-170k in Metairie and came out with about the same results. There are many more condos for sale in Metairie but getting down to the 5-6 better condos was not that hard.
I do have the advantage of seeing a lot and knowing the pitfalls of many of the condo associations. The negatives may be high condo fees, hard to finance associations, and units that will have poor resale values. The resale value is one of the most important factors buyers should be looking for when they buy.
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Housing tax Credit Extended? There are no free lunches! Someone will have to pay!
November 3rd, 2009 categories: Condo Knowledge, Grants and Incentives
As a real estate agent I am glad to get the credit extended. On the other hand I am worried that our Congress can only react to the crowds who want new favors. Does this make common sense when the real problem is creating an environment that will produce jobs. We will be getting ready for the next GM bailout shortly.
Its a carnival of incentives. Much like Mardi Gras- Throw me something so long as it cost me nothing. So if you can get it you have to take it. The interest rates remain low since the Feds are buying the mortgages. Its wild !
Senators agree to extend homebuyer tax credit By STEPHEN OHLEMACHER Associated Press Writer © 2009 The Associated Press
Oct. 28, 2009, 7:00PM
WASHINGTON— Senators agreed Wednesday to extend a popular tax credit for first-time home buyers and to offer a reduced credit to some repeat buyers.
The tax credit provides up to $8,000 to first-time homebuyers but is set to expire at the end of November. The Commerce Department said Wednesday that new home sales fell 3.6 percent in September, and some industry representatives blamed uncertainty about the tax credit.
Senators agreed to extend the existing tax credit for first-time home buyers while offering a reduced credit of up to $6,500 to repeat buyers who have owned their current homes for at least five years, said Regan Lachapelle, a spokeswoman for Senate Majority Leader Harry Reid, D-Nev.
The tax credits would be available to home buyers who sign sales agreements by the end of April. They would have until the end of June to close on their new homes, according to a summary of the legislation being circulated among lawmakers.
Senators were still negotiating the expansion of a separate tax credit that lets money-losing businesses get refunds for taxes paid in previous years, providing them with an immediate source of cash
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Still a Buyers Market in New Orleans Condos!
October 13th, 2009 categories: Buyers Agent, Condo Knowledge
When I say it is a buyers market it means almost everything favors the purchaser in this market at this time. All the factors are lining up to be in your favor. You can enjoy the negative sentiment and buy condos much cheaper than anytime in the last 5 years. Still have to be selective !
Seasonal Discount- You can always buy cheaper this time of year as less people are looking. it happens in the good and bad years.
Sellers getting Weary- Sellers who were asking to much have now begun to finally know they were too expensive. Buyers passed them by as well as agents. The listing is now stale. Much better buy now !
Very Low Interest Rates- 4.875% is a great rate. The U.S. is forcing rates low in hopes of getting the hosing markets and banks moving. The rates otherwise only make sense to the buyers. $538 per 100k borrowed
Condos Below building Cost! Some developers are dumping their unit to raise cash. They are out there. Its mostly at the lower end of the market. Great buys for a second home.
Sellers need Cash Owners of second homes may just need to sell. We have been seeing this mainly in the French Quarter as some sellers just want out. Be on the lookout for better deals.
FHA Loans are still Here! Owner occupied condos only. 3.5% down for accepted condo associations. Much lower mortgage insurance rates and seller can pay most of your closing costs.
$8000 tax Credit almost gone- Its good till November 30, 2009. That’s a gift of $8000 for the taxpayers.
Seller Concessions- Just need to ask for reasonable things and it can be worked out. Paying closing cost, leaving furniture, ect.
Lenders are not Busy- Stay local and be the center of attention! All the new rules will add time to the deal. Start early and get the process started.
Condo Fees are Level - The Katrina Insurance costs are working their way out of the system. The high rates are fading.
Property taxes are down 29% over 2008 in New Orleans- This favors the new buyers. Taxes are deductible on your State and Federal taxes.
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New Orleans Condo Foreclosures. Can they be good buys!
October 7th, 2009 categories: Condo Knowledge
There are not a lot of New Orleans condo foreclosures in this market at this time but they are beginning to show up. There are only a handful of places worth considering at the present time. One thing you will need is patience and the time for the bank to get things in order. The banks act like they could care less about customer service or doing things in a timely manner. It becomes a nightmare unless you can wait them out.
Much of the time the condos will need work as they may not have been taken care of. Many times the Banks will sell it like it is at a reduced rate or update it to get sold. It all depends which way you want to go. Most people do not want to do work so if you are able the price becomes much better. This is where you can build sweat equity either by doing it yourself or having someone do it for you. This is a risk feature that can work in your favor.
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Putting a Value on your New Orleans Condo Views ! Views and Windows do Matter!
August 31st, 2009 categories: Condo Knowledge
One of the primary factors in the resale of your condo is the views. You may not have paid extra for the views in the beginning if you were the original purchaser. You just got first choice and you chose the one that you liked. This is most likely the one that most people would have liked. However all people do not think of resale. The smart ones do.
The views do not show up in the square footage prices so how do you quantify the views. It only shows up in like type of units. It is very hard to put a dollar figure on this factor but it does exist. Since New Orleans has few high rise condos its not how high you are. Most buildings here are not tall but conversions of older buildings and homes.
Light also figures into views as people like large windows that lets in natural light. No one wants the afternoon sun heating up your condo but they want the reflective light. Oddly enough most condos are exposed to the blistering heat of the New Orleans afternoon sun.
What you actually see is equally as important. Looking at a trash can is not going to add values but getting a nice city view does matter. Getting a nice city street view can be a great view. It all depends on what people generally like. People always ask about River Views but there are few high rises that have them in the under 600k range.
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New Orleans Real Estate, Odds and Ends! Some things worth thinking about!
August 10th, 2009 categories: Condo Knowledge, Grants and Incentives
As we near the end of Summer there are a number of things to think about if you are in the market for a home or condo.
- The $8000 federal tax credit expires November 30, 2009. A big incentive not to put off a purchase until next year.
- There is State Bond Money on the way. No rates or details yet but the rates should be good. There are always income limits and the help on Bond issues is generally around 4%. Borrow 200k and that’s an $8000 credit plus the tax rebate. Stay tuned!
- FHA is still the best way to go for a low down payment of 3.5%. You have to have a great lender when doing spot approavals. Checking things out in advance is the best way to go. FHA spot approvals.
- Interest Rates are still in the 5.5% range which is very low by historical standards. Rates change daily and generally cannot be locked in till you have a purchase agreement.
- Sellers are more eager to sell if they have overpriced the property in the beginning of Summer. There is less people looking this time of year which makes it a seasonal buyers market. Its a Seasonal Discount and happens every year. Seasonal Discouts do Live!
- I am often asked how much people come of the price of what they are asking? The answer can vary and the average is 3-4% of the last asking price. As a buyer you want to approach this from what the property is worth and go from there. How to Value Your Condo!
- Do condo fees ever go down? They rarely go down as cost to do things tend to rise over time. The biggest cost in condo fees are the insurance premiums. These may hold steady or drop every now and then but something else is going up in cost or the condo reserves will build up in the mean time. Condo reserves are like a savings account.
- Always start out by know what you can afford. This is most easily down with a face to face meeting with a local lender who knows the market and has the back office and experience to get the loan down in a timely and painless fashion. Avoid out of town lenders.
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