Tampa Area Sees First Median Home Sales Price Increase Since 2006

For the first time since 2006, the median home sales price in the Tampa-St. Petersburg-Clearwater MSA increased. The existing home median sales price was $125,600; a year ago, it was $122,400 for a 3 percent increase. A total of 1,603 homes sold in January compared to 1,573 homes a year ago for a 2 percent increase. In the year-to-year comparison for the existing condo market, a total of 574 units sold in the MSA last month, up 85% from a year ago when 310 condos sold. The market’s existing condo median price was $100,000; a year ago, it was $108,600 for a 8 percent decrease.

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US New-Home Sales Hit Record Low

Sales of new homes declined 11 percent in January from December to the lowest level since the U.S. began keeping records in 1963, according to a report from the U.S. Commerce Department released Wednesday. Sales dropped to an annual pace of 309,000 with the median price falling to $203,500 in January, the lowest since December 2003. At the current sales rate, there is a 9.1 months' inventory of new homes. New home purchases are 6 percent of the housing market.

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One in two homes in Tampa area underwater

Nearly half the homes in the Tampa-St. Petersburg market are financially underwater, or upside down, according to a new report from First American CoreLogic. The latest statistics show that 332,968 homes, or 48.5 percent in the Greater Tampa area, were in negative equity during the fourth quarter. Another 28,182, or 4.1 percent, were near negative equity in the market. That is in-line with Florida as a whole, which reported 48 percent negative equity, behind only Nevada with 70 percent underwater and Arizona with 51 percent upside down. Florida had the second-highest number of underwater mortgages at 2.2 million, behind California with 2.4 million.

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US home prices rise 0.3 percent in December

Home prices rose for the seventh straight month in December, a sign of price stability as the U.S. housing market continues its bumpy road to recovery. The Standard & Poor's/Case-Shiller 20-city home price index released Tuesday rose 0.3 percent from November to December, to a seasonally adjusted reading of 145.87. The index was off 3.1 percent from December last year, nearly matching analysts' estimates that it would fall by 3.2 percent. Only five of 20 cities in the index showed declines from November to December. The index is now up more than 3 percent from its bottom in May, but still 30 percent below its May 2006 peak. Los Angeles and Phoenix posted the largest price increases. The worst performer was Chicago with a 0.6 percent decline.

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Could the Tax Credit Be Extended Again?

The pressure is increasing on Congress to renew the homebuyer tax credits for a third time. The first $7,500 tax credit was passed in 2008 and required first-time buyers to repay the credit over 15 years. A few months later in 2009, Congress expanded the credit to a maximum of $8,000 that didn’t have to be paid back. At the end of last year, Congress extended the benefit again until April 30 with an extra two months on top of that to close. A new credit of $6,500 was added for move-up buyers, too. Now representatives of the housing industry are lobbying for another extension. Some experts, including Mark Zandi, chief economist at Moody’s Economy.com, who supported the earlier credits, think the time has come to let it go. “It’s worn out its benefit,” he says. “If you extend it again, it isn’t going to do much, and what you’re doing is providing a tax break to folks who bought anyway.”

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IRS Clarifies What's Needed to Claim Tax Credit

The Internal Revenue Service has clarified which documentation taxpayers need to submit to claim the first-time and move-up homebuyer tax credit. While the IRS is still requiring the filing of Form 5405, it is not demanding that all parties’ signatures be on the HUD-1 settlement document in areas where requiring both the buyer and the seller to sign the document isn’t common. The IRS clarification says: "In areas where signatures are not required on the settlement document, the IRS has clarified that it will accept a settlement statement if it is completed and valid according to local law. … The IRS encourages those buyers to sign the settlement statement prior to attaching it to the tax return.” For repeat buyers, the IRS is seeking documentation that home buyers have lived in the previous property for a consecutive five of the past eight years. Proof can include property tax records, home owner insurance records, or mortgage interest statements.

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Mortgage delinquencies decrease

The number of borrowers falling behind on their mortgage payments dropped sharply at the end of last year, a sign the foreclosure crisis is beginning to ebb. The Mortgage Bankers Association said Friday that the percentage of borrowers who missed just one payment on their home loans fell to 3.6 percent in the October to December quarter, down from 3.8 percent in the third quarter. The decline was even more surprising because delinquencies usually rise at that time of year because of higher heating bills and holiday spending. The new trend in late payments is significant because it means the number of people going into foreclosure should continue to decline this year. And that is important for all homeowners in areas where cheaply priced foreclosures are bringing down neighboring values. In high-foreclosure cities like Las Vegas, Phoenix and Miami, for example, homes have lost roughly half their values from their peaks. Friday's report, however, showed Nevada, Arizona and Florida had some of the biggest declines in new delinquencies.

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Citizens Insurance Policies Found To Be Lopsided

Recent policyholder inspections by Citizens Property Insurance Corp. found that some homeowners are getting more of a discount for fortifying their homes than they are eligible for. The state-backed insurer looked at 452 policyholders. Of those, 311 homeowners - more than two-thirds - were receiving more than they are owed, while 39 aren't getting enough, the insurer said this week. Citizens spokeswoman Christine Turner Ashburn said that policyholders who owe more will be told they can fortify their homes to receive the discounts or their premiums will rise. Ashburn says the company is trying to be fair. All Florida home insurance policyholders pay fees to offset Citizens' deficits from previous hurricanes.

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Short sale deals increasingly requiring bank paybacks

With so many distressed homeowners owing more than their homes are worth, short sales have become life lines. These types of sales make up more than half of the homes on the market in Tampa Bay. Generally, this means the mortgage lender has agreed to allow the home to sell for market value. The lender writes off the rest of the debt, and the homeowner walks away. But is it really this simple? Lenders are increasingly adding language to the approval package, reserving the right to pursue the deficiency amount later, that is, the difference between what you owed on the house and what it sold for. Some homeowners, so anxious to get out of a pending foreclosure, skip right over that part of the letter. Some understand, but opt to take their chances, betting they won't hear from the lender again.

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CoreLogic: Home price declines improving around Tampa

Home prices are still declining in the Greater Tampa-St. Petersburg metropolitan area, but the rate is slowing. A new report from First American CoreLogic shows home prices, including distressed sales, were down 11.8 percent in December, slightly worse than the rest of Florida but better than its year-over-year declines in November that topped 13 percent. When distressed sales were removed, annual price declines in the market were 11.3 percent, compared with 12.5 percent the year before. It was a better story nationally where home prices dropped just 3.7 percent in December, compared with a 5.3 percent decline the year before.

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Mortgage Rates Hover Near Record Lows

The 30-year fixed-rate mortgage (FRM) averaged 4.93 percent with an average 0.7 point for the week ending February 18, 2010, down from last week when it averaged 4.97 percent. Last year at this time, the 30-year FRM averaged 5.04 percent.

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State recovery will be slow, analyst says

Housing prices aren't likely to fall much further, but mortgage interest rates are about to start rising, according to well-known Florida economist Hank Fishkind. Interest rates, which are still in the 4 percent range, could be 8 percent or higher by early 2012, Fishkind said Wednesday during a meeting of the Bay Area Real Estate Council. The area is out of the recession, although the recovery will be slow.

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The Mortgage Forgiveness Debt Relief Act and Debt Cancellation

If you owe a debt to someone else and they cancel or forgive that debt, the canceled amount may be taxable. The Mortgage Debt Relief Act of 2007 generally allows taxpayers to exclude income from the discharge of debt on their principal residence. Debt reduced through mortgage restructuring, as well as mortgage debt forgiven in connection with a foreclosure, qualifies for the relief. This provision applies to debt forgiven in calendar years 2007 through 2012. Up to $2 million of forgiven debt is eligible for this exclusion ($1 million if married filing separately). The exclusion does not apply if the discharge is due to services performed for the lender or any other reason not directly related to a decline in the home’s value or the taxpayer’s financial condition. More information, including detailed examples can be found in Publication 4681, Canceled Debts, Foreclosures, Repossessions, and Abandonments.

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Housing bargains abound, but try closing the deal quickly

Matt and Brenda Wehrly can't wait to move out of their cramped apartment and into their first home. The couple, expecting their second child, plan to close on a 3-bedroom home in Gibsonton this month. The house sold in late 2005 for $222,800, and the Wehrlys are ecstatic about their contract to snatch it up for $97,000. Sweetening the pot even more, the couple will be eligible for an $8,000 federal tax credit. "We wanted to buy something that would allow us to live on one income," said Brenda Wehrly, who plans to eventually stay at home with her children. "We wouldn't have been able to do that a few years ago." Tampa Bay sales prices have plummeted more than 40 percent since the peak of the housing boom in 2006. That, coupled with federal tax incentives, is motivating buyers like the Wehrlys to get off the fence and purchase a home. This, real estate professionals say, has given a needed boost to Tampa Bay's struggling housing market.

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Tampa Ranked As Worst American City For Commuters

Forbes Magazine ranks Tampa as the worst American city for commuters. You've got to be kidding me.

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State erects foreclosure hurdle

The Florida Supreme Court continues to make it more difficult for lenders to foreclose in the Sunshine State. The court says lenders now are required to verify they own loans before they file a foreclosure lawsuit. And, according to the court order, lenders no longer can charge the homeowner for that investigation. This comes after a court order in late December that requires lenders to offer owners of primary residences a chance to negotiate with a third-party mediator before moving forward with foreclosure. Florida has the nation's fourth-highest foreclosure rate, and the court estimates about 456,000 foreclosure cases are clogging the state's court system. The new rules are an effort to help the courts better manage foreclosure cases and make sure lenders have tried to modify loans before taking back homes. The rules and corresponding legal forms were proposed by a pair of Florida Bar panels.

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Shadow Inventory Unlikely to Hurt Market

Nearly 5 million houses and condos, of which the mortgages are delinquent, will go through foreclosure over the next few years, a new study by John Burns Real Estate Consulting Inc. concludes. This represents more than half of the 7.7 million households now behind on their mortgage payments. The situation is worst in Arizona, California, Florida, and Nevada. Burns calculates that there is an inventory equivalent to 27 months of sales in Orlando, 24 months in Miami, and 18 months in Las Vegas. Consulting firm CEO John Burns says there is strong investor demand for these properties, so as long as employment continues to recover and interest rates remain moderate, these sales won’t have much impact on overall prices.

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CitiMortgage pilot program targets Florida homeowners facing foreclosure

CitiMortgage launched a pilot program Thursday for financially distressed homeowners to avoid foreclosure and secure six more months in their home. The hook: They have to maintain their homes in good condition and agree to sign over property deeds to Citi once the six-month clock runs out. The initiative, which is being tested in Florida and five other states, has been dubbed the Citi Foreclosures Alternatives Program.

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Condo owners must cover fees for deadbeats

Island Escape is a nice little condo complex with what has become a big problem throughout Florida: an owner who isn't paying his condo fees. The occupant of Unit 110 is nearly $7,500 in arrears, forcing the other nine owners — some of them on fixed incomes — to pay his share of maintenance costs as well as their own. Adding to their pique is the fact that the tardy owner also hasn't paid his mortgage in two years, meaning he has been enjoying the waterfront life for free. "Here's a classic case of somebody using and abusing the system,'' says Wesley "Skip'' Shepherd, president of the condo association. "We're paying the insurance, the water, the sewer, the taxes on his place and the guy's living there for nothing." As the economy staggers along, more associations face that problem.

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Move-up Buyers Face Hurdles

Home owners are finding it difficult to take advantage of the move-up tax credit, which is one more handicap slowing the housing market. Move-up buyers represented 53 percent of the 2009 market, down from an average of 60 percent in previous years, according to the NATIONAL ASSOCIATION of REALTORS®. While many would like to take advantage of the tax credit, a significant number are unable to sell their current residences and/or get financing for a trade up.

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30-Year Fixed-Rate Mortgage Dips Below 5 Percent Again

The 30-year fixed-rate mortgage (FRM) averaged 4.97 percent with an average 0.7 point for the week ending February 11, 2010, down from last week when it averaged 5.01 percent. Last year at this time, the 30-year FRM averaged 5.16 percent.

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January Tampa Area Foreclosures Down 2% From Last Year

The pace of foreclosures has slowed, but filings in two local counties rose in January, while filings declined in the other two counties. There were 6,081 filings - default notices, scheduled foreclosure auctions and bank repossessions - in the Tampa area in January, according to Calif.-based RealtyTrac. That's up 5 percent from the previous month but down 2 percent from the same time last year. RealtyTrac includes Hillsborough, Pinellas, Hernando and Pasco counties in its report for the Tampa area. Hillsborough and Pinellas counties, which accounted for 4,752 of the filings, jumped 15 percent and 10 percent, respectively, from December's filings. In Hernando and Pasco counties, filings fell 9 percent 19 percent, respectively.

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US foreclosures down in January, but surge on way?

The number of U.S. households facing foreclosure in January increased 15 percent from the same month last year, and a surge in cash-strapped homeowners who've fallen behind on mortgages could be on the way. More than 315,000 households received a foreclosure-related notice in January, RealtyTrac Inc. reported Thursday. That number is down nearly 10 percent from 349,000 in December, which saw the third highest total since the company began tracking foreclosure data in 2005. Among states, Nevada posted the nation's highest foreclosure rate, followed by Arizona, California, Florida and Utah. Rounding out the top 10 were Idaho, Michigan, Illinois, Oregon and Georgia. The metro area with the highest foreclosure rate in January was Las Vegas, with one in every 82 homes receiving a foreclosure filing. It was followed by Phoenix and the California cities of Modesto, Stockton, and Riverside-San Bernardino-Ontario.

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Report details decline in home values for parts of Tampa area

Tampa Bay home values continue to fall, owners owe more on mortgages than their homes are worth and many are selling for a loss, according to the real estate website Zillow.com. Tampa area home values fell about 13 percent to a median value of $123,600 in the fourth quarter of 2009, according to a report released today. Values fell 0.8 percent from November to December. Zillow considers the Tampa area to be homes in Hernando, Hillsborough, Pasco and Pinellas counties. Meanwhile, 46 percent of all owners of single-family homes with mortgages were underwater at the end of the fourth quarter. That's a little better than in the third quarter, when nearly 48 percent owed more than their home's value.

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Are Interest Rates About to Rise?

Federal Reserve Bank of New York President William Dudley says the central bank will scale back its purchases of mortgage-backed securities late next month. While interest rates likely will climb when the program ceases, the extent of the rise remains to be seen. Dudley says the Fed will act if rates spike too much. Still, analysts worry that the end of the MBA purchase program and expiration of the home-buyer tax credit, along with higher premiums and tighter underwriting of FHA mortgages, will work together to stifle home sales and price stabilization in the coming months.

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New program offers home loans, assistance in Hillsborough County

If you're looking for a home in Hillsborough County, you may be able to get even more help with your purchase. The Housing Finance Authority of Hillsborough County said today that it has $20 million now available to lend for mortgages. The mortgages are 4.99 percent, 30-year fixed rate loans and will be funded from proceeds of a bond sale. The authority also is offering down payment assistance of $5,000 to some buyers. To qualify for the loan, the household income limits are $63,832 for households of 1 or two and $73,406 for three or more. The purchase price cannot exceed $258,690. For more information, call 1-888-316-8536 or go to the authority's website at www.hillsboroughcountyhfa.org.

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Housing Inventories Up Slightly in January

Housing inventories in the 27 major metropolitan areas covered by ZipRealty rose only 2.87 percent in January, compared to December. Inventories in January usually rise sharply in anticipation of the spring selling season. Ivy Zelman, CEO of Zelman & Associates research firm, blamed this year’s situation on the unusually cold weather and the widespread decision among sellers to hold properties off the market in hopes of a better economy. Zip data doesn’t cover New York City, where appraisal firm Miller Samuel Inc. reports that Manhattan inventory was up 10 percent from December, but down 19 percent from January 2009.

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Long-Term Mortgage Rates Remain Stable and Low

The 30-year fixed-rate mortgage (FRM) averaged 5.01 percent with an average 0.7 point for the week ending February 4, 2010, up from last week when it averaged 4.98 percent. Last year at this time, the 30-year FRM averaged 5.25 percent.

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Mortgage lenders pursue homeowners even after foreclosure/short sale

As terrible as it is to lose your house to foreclosure, at least it's a relief to put your biggest financial headache behind you, right? Wrong. Former homeowners may still be on the hook if there's a difference between what they owed on their mortgage and what the bank could sell it for at auction. And these "deficiency judgments" are ticking time bombs that can explode years after borrowers lose their homes. It can even happen to people who got their bank to approve them selling their home for less than it is worth. Vanessa Corey, for example, short sold her Fredericksburg, Va., home in April 2008. She and her husband built the house in 2004, but setbacks, both personal (divorce) and professional (housing bust), made it impossible for the real estate agent to keep her home. So she negotiated the short sale and thought that was the end of it. "My understanding was that the deficiency was negotiated away," she said. "Then, last November, I got a letter from a lawyer telling me I owed my lender $65,000. I had to declare bankruptcy. There was no way I could pay it."

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Homeownership Rate Declines

The percentage of American home owners fell to 67.3 percent at the end of the fourth quarter of 2009, the lowest percentage since the second quarter of 2000. The homeownership rate reached a high of 69 percent in 2004, fueled by low interest rates and easy credit. But the rate began to fall in 2006 as some owners failed to make their payments and faced foreclosure. Since then nearly 4 million homes have been lost to foreclosure. “The homeownership data I think really just underscores how this country as a whole became obsessed with getting people into homes," says Mike Larson, real estate and interest rate analyst at Weiss Research Inc., an investment-research firm. "You can do all kinds of things to get people into a house, which we did; the real problem is making it so they can stay there."

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What Will the Market's New Normal Be?

In a new study, "Housing in America: The Next Decade," Urban Land Institute senior resident fellow John McIlwain says the housing market will not return to what it was prior to the downturn but rather that a "new normal" will take its place. He expects another 10 percent decrease in residential prices this year, a jump in the number of borrowers abandoning "underwater" mortgages, and a change in consumer perceptions of homeownership. "The emotional impact on the children and parents and disillusion about the 'joys' of homeownership will be intense; new attitudes to homeownership and the American dream will emerge," McIlwain writes. He expects home price appreciation to hover around 1 percent or 2 percent per year after the market recovers and the national homeownership rate to drop from 67 percent currently to 62 percent by 2020.

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First-time homebuyers have another enticement to buy

First-time homebuyers wanting to take advantage of federal tax credits now have an extra incentive: down payment assistance. Buyers in unincorporated Hillsborough County could be eligible for a new program that provides money for down payments and closing costs. The Hillsborough County Affordable Housing Department will release $1.18 million for those buying in the county, including unincorporated Temple Terrace and Plant City, according to a statement by the county. The money will be available beginning Feb. 5. It will be distributed on a first-come, first-served basis, and the buyer's lender is solely responsible for submitting the applications.

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Continuing fears dampen Florida real estate outlook

The real estate market could get worse before it gets better, according to the latest quarterly survey conducted by the University of Florida. Respondents in the survey said they feared stagnant financial markets, rising unemployment and another round of foreclosures in 2010, said Timothy Becker, director of UF’s Bergstrom Center for Real Estate Studies. Becker said he expects foreclosures, both commercial and residential, to continue to plague Florida because of the issue with refinancing mortgages and the statewide unemployment rate, which at 11.8 percent in December was at its highest since 1975, and may continue to climb. Jacksonville’s unemployment rate was slightly better in December at 11.3 percent. Fourteen Florida cities were among the top 100 markets in the nation for foreclosure rates, and eight of them were in the top 20, according to the RealtyTrac 2009 Metropolitan Foreclosure Market Report. The Tampa-St. Petersburg-Clearwater metro ranked No. 22 with 4.77 percent of housing units receiving a foreclosure filing.

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Fannie to Offer Closing Cost Aid on Foreclosures

Fannie Mae, the largest provider of residential home funding in the United States, announced Friday that it would pay the closing costs on purchases of foreclosed homes in its inventory. The government-controlled company said buyers of qualified properties will get up to 3.5 percent in closing costs, or an equivalent amount for the purchase of new appliances. The goal of Fannie is to clear out the nearly 50,000 properties it has in inventory— listed on HomePath.com, the Web site created by Fannie Mae last year to sell the growing number of foreclosed homes.

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