How to survive prices Cooling home market heightens demand.
By The Wall Street Journal.
Originally posted on June 29, 2006
It's no longer a renter's market.For years, rents have been flat or falling in cities nationwide — a result of the booming home-sales market, which transformed scores of renters into owners. But as the housing market cools, rentals are once again in demand, liberating landlords in many markets to raise rents at the fastest pace in years. They're also cutting back on the goodies that previously helped lure tenants, such as a free month's rent or a free DVD player.
While renters have had an easy ride for years, the current bout of rent increases could prove to be a jolt for many Americans, from seniors looking to downsize to recent grads looking for their own place. Average effective rents — or what tenants pay after taking concessions into account — are expected to rise 3 percent this year, according to Reis Inc., a real-estate research firm. Rents began picking up last year after several years of softness. As recently as 2002, rents fell 1 percent.Lee County is no exception.
For example, the average rent for a nice two-bedroom apartment in Lee County was up 13.9 percent to $1,017 in 2005. A one-bedroom rose 11 percent to $845 a month, according to PCMG, a property management company that specializes in multifamily buildings.The local rental market has been pushed up by the trend of converting existing apartments to condominiums: a total of more than 5,500 units sold to condo converters in the past two years.The pace of change varies greatly from market to market. In its survey of 69 metro areas, Reis found 60 markets with rising rents, with Florida's Fort Lauderdale, Palm Beach, Miami and Tampa-St. Petersburg and California's San Jose topping the list. It also found nine markets in which rents are flat or falling, including Buffalo, N.Y.; Charlotte, N.C.; Denver and Omaha, Neb.
Generally, rents in East and West Coast cities are expected to rise the fastest. Archstone-Smith, which owns apartment buildings in 41 cities, says it is increasing rents 8 percent to 10 percent in New York City and Southern California. And in South Florida, vacancy rates are so low that some landlords are raising rents as much as 28 percent, according to McCabe Research & Consulting. In Chicago, just five of 34 large apartment buildings offered concessions to renters in the first quarter, down from 19 a year earlier, according to Appraisal Research Counselors, a real-estate consulting firm.It's partly a supply-and-demand issue. Years of soaring house prices (and recent increases in mortgage rates) have simply priced many people out of the home-buying market. Indeed, the portion of U.S. households owning their own home slipped to 68.5 percent in the first quarter from 69.1 percent a year earlier, according to the Census Bureau.
Biagio Bonfrisco, a real-estate agent, began looking for his first home about two years ago, just before his wedding. "The market was too high, and it's still too high," says Bonfrisco. As a result, he and his wife rent the second-floor of a two-family house in Bergen County, N.J.Still, tenants might be able to find some good deals. For instance, landlords of new buildings still needing the first round of renters may be more willing to negotiate concessions. It can also be worth seeking out individual owners who are unable to sell a house or condominium and may be looking to rent at a reasonable price instead.The best season to apartment-hunt: between Thanksgiving and Christmas, when rental demand typically slows.
The higher costs for rentals come as strong job growth in recent years has boosted demand for apartments. At the same time, many apartments have been converted to condos, reducing the availability of rentals. Tenants forced out of units being converted to condos often have trouble finding another apartment with a similar rent, real-estate agents say.The squeeze comes as average vacancy rates dropped to 6 percent in the first quarter from as much as 7.4 percent at the end of 2003, according to Property & Portfolio Research Inc., giving landlords more power to boost rents than they've had since the beginning of the decade.
Camden Property Trust, a big apartment owner, says it is raising rents in all of its 22 markets. In Miami, Camden now charges an average of $1,319 a month for its apartments, up 7.4 percent from $1,228 in the first quarter of 2005. In Houston, its average rents rose $20 to $800 over this same period, the company says.Freebies are vanishing, too. United Dominion Realty Trust Inc., which operates in 17 states, says the amount it spent on free rent and other concessions fell 26 percent in the first quarter from the year-earlier period, to roughly $12 million, or about $265 for each new tenant. "Over the next 12 months, we expect that number to shrink practically to zero," says Thomas Toomey, the company's chief executive.Even with the latest price increases, renting remains a bargain compared with owning in much of the country. In Las Vegas, Los Angeles and Seattle, the monthly cost of renting the average apartment was roughly half what it would cost to own the median-priced home in the first quarter, according to an analysis prepared for The Wall Street Journal by Torto Wheaton Research, a unit of CB Richard Ellis Group Inc. The cost of owning is based on a 15 percent down payment and a 30-year fixed-rate mortgage; it doesn't include property taxes, insurance or tax deductions.
Major landlords will sometimes offer a better deal on just a handful of units. At AvalonBay Communities Inc., which owns apartments in a number of major markets, concessions have fallen 50 percent over the past year. But tenants may still get a break on certain apartment models that are moving more slowly, the company says.And even in some cities where overall rents are rising, individual investors having trouble selling condos and single-family homes are rushing to rent them instead. In Chicago, enterprising tenants can rent a luxury condo for about the same amount per month as a unit in an older apartment building. "It's harder to track those down, and you don't get the same management attention as you would in a rental building," says Ron DeVries, vice president of Appraisal Research Counselors in Chicago.
In some markets, such as South Florida, vacancy rates for large apartment buildings are down and rents are up. However, the supply of condos and homes available to rent in the region is growing as investors clamor to rent out properties they are having trouble selling. Owners of large rental buildings fear that this "shadow supply" of rental properties could eventually put a lid on rent increases in some markets where speculation has been rampant."We're having a flood of rental properties coming back into the market simply because the investors who bought with the intention of flipping them have not been able to," says Brenda F. Gerdes, broker-owner of Management Specialists Inc., a property-management firm in Port St. Lucie, where average rental rates for properties owned by individual investors have fallen about 20 percent over the past year.Real-estate agents say individual investors need to be realistic about their asking rents, even if the rent isn't enough to cover their monthly costs. Robert Fowler, owner of HomeRentalAds.com, a rental Web site, tells clients to base their asking rents on what similar properties are fetching, not the rents charged by large apartment complexes. If tenants aren't forthcoming, "don't wait too long before making adjustments," he adds.
J.P. Johnson, a shutter salesman, has been trying for the past three months to rent out a four-bedroom, 31/2-bath home in Palm Beach Gardens, that he purchased for $661,000. He recently dropped the asking rent to $3,000 from $3,300 but has yet to find a tenant. "The market has slowed down," he says. "We have had a few phone calls, but nothing solid."
Friday, June 30, 2006
Thursday, June 22, 2006
FHA changes make appraisals, financing more buyer-friendlyRigorous rules drove away customers
FHA changes make appraisals, financing more buyer-friendlyRigorous rules drove away customers.
By Knight Ridder News Service.
Originally published on June 22, 2006
Knight Ridder News Service.
Lynette and Jeff Fletcher stand outside their Ravenna, Ohio, home with daughters Brittany, 12, and Hannah, 1. The couple was able to buy the house with an FHA loan.
WHAT ARE FHA MORTGAGES?• The loans were designed to help low- and moderate-income families buy their own homes.• Lending guidelines are less rigorous. People who have too much debt to qualify for conventional bank loans or who don't have much money for a down payment often can still qualify for an FHA loan.• The loan is made through government-approved lenders.• Repayment is guaranteed by the Federal Housing Administration.• Borrowers pay mortgage insurance, which reimburses the lender if the loan is not repaid.• The maximum amount that can be financed in Portage and Summit counties in Ohio for a single-family home is $242,250.
When Jeff and Lynette Fletcher bought their first house recently, they turned to one of the nation’s oldest lending programs.They got the money to buy a century home in Ravenna, Ohio, from the Federal Housing Administration, or FHA.The federal agency, which issues federally backed loans to people who don’t qualify for regular or conventional mortgages, had fallen out of favor with buyers and sellers because of its rigorous appraisal regulations.
Starting Jan. 1, appraisers no longer have to flag a home for a cracked window pane, leaky faucets, a missing handrail or the lack of an all-weather driveway surface.The time and expense of such minor repairs had been driving customers into the arms of subprime lenders who could underwrite a loan more quickly and easily — albeit often at a higher interest rate.In 1997, FHA accounted for 11 percent of all home loans, but that share had dwindled to a mere 3 percent by 2005.FHA is changing its ways in an effort to win customers like the Fletchers.Jeff Fletcher, a 38-year-old plumber, and his wife moved to Northeast Ohio from Sonoma County, Calif., last summer to find a more affordable place to live and raise their children.They’d heard about FHA’s faults. “I’ve heard lots of stories about how their inspectors were really strict” and “wouldn’t pass certain things,” recalled Lynette Fletcher, a 37-year-old stay-at-home mother. “Everything was drawn out.”They’d also heard about FHA’s changes. When they got serious about buying, they talked to their broker and decided to enroll in an FHA program that requires little or no down payment."It was really a piece of cake," Lynette Fletcher said.The couple moved into their new home on South Walnut Street two weeks ago. They paid about $120,000."This home has been gutted and totally remodeled in the last 10 years," but it still has character, Lynette Fletcher said. "I have gingerbread on the front porch."
The couple got a favorable interest rate and relatively low closing costs through FHA.
Appraisals simplified
Appraiser Bob Hamilton also is pleased with the new procedures.Gone are the five pages of the VC, or value condition, sheet filled with items that he had to check off."FHA now is really only concerned with the big items," said Hamilton, who has been in the appraisal business since 1985. His company, Hamilton Appraisal Services, is located in Cuyahoga Falls.
The big items that still require repairs include inadequate egress or access to interior rooms, leaky roofs, standing water around a foundation and structural problems such as a buckled basement wall. In homes built before 1978, any lead paint has to be scraped and removed.The new approach is "in line with conventional lenders" who "didn't have to worry about a missing handrail," Hamilton said.
FHA's old regulations slowed the process of selling a home, Hamilton said. The appraisal would often take four to five hours — and longer if the property was located in a rural area far from comparable properties. If repairs were needed, he was required to return to the property to see if they were properly done.Although FHA's appraisals are simpler, they're still not the equivalent of a home inspection, Hamilton said. Borrowers are required to sign a form acknowledging the appraisal doesn't guarantee any parts of the home.An aging roof with no active leak will pass the appraisal process, even though it may need to be replaced.
"Everybody should have every house inspected," Hamilton advised.
Financing changes
In addition to appraisal changes, FHA also is modifying its financing practices.Until recently, buyers were restricted on how much closing costs they could pay. Lenders would often charge some of those costs to sellers, which made some sellers reluctant to accept purchase offers with FHA financing.FHA now says buyers can be charged for any closing costs that are customary to the area, said Patti McClister at National City Mortgage Co. in Akron.
The financing end was where FHA traditionally beat out the competition.People with credit problems or those who have spent a short time on the job who couldn't qualify for conventional loans often turned to FHA, which also gave them more leeway on how much debt they could carry.
With interest rates rising, FHA may also be an alternative to some of the newer loan products on the market, said John Mirka at Wells Fargo Home Mortgage Co. in Cuyahoga Falls.Move-up buyers who had been using 80/20 first- and second-mortgage combinations may turn instead to FHA loans for 100 percent financing — at a lower interest rate and monthly payment, Mirka said.About 30 percent to 40 percent of his customers are seeking 100 percent financing, Mirka estimated, and FHA loans currently account for about one-fifth of his volume.
"Since the guidelines have become more relaxed, I've seen the Realtor community be a little more open to that type of financing," he said.
By Knight Ridder News Service.
Originally published on June 22, 2006
Knight Ridder News Service.
Lynette and Jeff Fletcher stand outside their Ravenna, Ohio, home with daughters Brittany, 12, and Hannah, 1. The couple was able to buy the house with an FHA loan.
WHAT ARE FHA MORTGAGES?• The loans were designed to help low- and moderate-income families buy their own homes.• Lending guidelines are less rigorous. People who have too much debt to qualify for conventional bank loans or who don't have much money for a down payment often can still qualify for an FHA loan.• The loan is made through government-approved lenders.• Repayment is guaranteed by the Federal Housing Administration.• Borrowers pay mortgage insurance, which reimburses the lender if the loan is not repaid.• The maximum amount that can be financed in Portage and Summit counties in Ohio for a single-family home is $242,250.
When Jeff and Lynette Fletcher bought their first house recently, they turned to one of the nation’s oldest lending programs.They got the money to buy a century home in Ravenna, Ohio, from the Federal Housing Administration, or FHA.The federal agency, which issues federally backed loans to people who don’t qualify for regular or conventional mortgages, had fallen out of favor with buyers and sellers because of its rigorous appraisal regulations.
Starting Jan. 1, appraisers no longer have to flag a home for a cracked window pane, leaky faucets, a missing handrail or the lack of an all-weather driveway surface.The time and expense of such minor repairs had been driving customers into the arms of subprime lenders who could underwrite a loan more quickly and easily — albeit often at a higher interest rate.In 1997, FHA accounted for 11 percent of all home loans, but that share had dwindled to a mere 3 percent by 2005.FHA is changing its ways in an effort to win customers like the Fletchers.Jeff Fletcher, a 38-year-old plumber, and his wife moved to Northeast Ohio from Sonoma County, Calif., last summer to find a more affordable place to live and raise their children.They’d heard about FHA’s faults. “I’ve heard lots of stories about how their inspectors were really strict” and “wouldn’t pass certain things,” recalled Lynette Fletcher, a 37-year-old stay-at-home mother. “Everything was drawn out.”They’d also heard about FHA’s changes. When they got serious about buying, they talked to their broker and decided to enroll in an FHA program that requires little or no down payment."It was really a piece of cake," Lynette Fletcher said.The couple moved into their new home on South Walnut Street two weeks ago. They paid about $120,000."This home has been gutted and totally remodeled in the last 10 years," but it still has character, Lynette Fletcher said. "I have gingerbread on the front porch."
The couple got a favorable interest rate and relatively low closing costs through FHA.
Appraisals simplified
Appraiser Bob Hamilton also is pleased with the new procedures.Gone are the five pages of the VC, or value condition, sheet filled with items that he had to check off."FHA now is really only concerned with the big items," said Hamilton, who has been in the appraisal business since 1985. His company, Hamilton Appraisal Services, is located in Cuyahoga Falls.
The big items that still require repairs include inadequate egress or access to interior rooms, leaky roofs, standing water around a foundation and structural problems such as a buckled basement wall. In homes built before 1978, any lead paint has to be scraped and removed.The new approach is "in line with conventional lenders" who "didn't have to worry about a missing handrail," Hamilton said.
FHA's old regulations slowed the process of selling a home, Hamilton said. The appraisal would often take four to five hours — and longer if the property was located in a rural area far from comparable properties. If repairs were needed, he was required to return to the property to see if they were properly done.Although FHA's appraisals are simpler, they're still not the equivalent of a home inspection, Hamilton said. Borrowers are required to sign a form acknowledging the appraisal doesn't guarantee any parts of the home.An aging roof with no active leak will pass the appraisal process, even though it may need to be replaced.
"Everybody should have every house inspected," Hamilton advised.
Financing changes
In addition to appraisal changes, FHA also is modifying its financing practices.Until recently, buyers were restricted on how much closing costs they could pay. Lenders would often charge some of those costs to sellers, which made some sellers reluctant to accept purchase offers with FHA financing.FHA now says buyers can be charged for any closing costs that are customary to the area, said Patti McClister at National City Mortgage Co. in Akron.
The financing end was where FHA traditionally beat out the competition.People with credit problems or those who have spent a short time on the job who couldn't qualify for conventional loans often turned to FHA, which also gave them more leeway on how much debt they could carry.
With interest rates rising, FHA may also be an alternative to some of the newer loan products on the market, said John Mirka at Wells Fargo Home Mortgage Co. in Cuyahoga Falls.Move-up buyers who had been using 80/20 first- and second-mortgage combinations may turn instead to FHA loans for 100 percent financing — at a lower interest rate and monthly payment, Mirka said.About 30 percent to 40 percent of his customers are seeking 100 percent financing, Mirka estimated, and FHA loans currently account for about one-fifth of his volume.
"Since the guidelines have become more relaxed, I've seen the Realtor community be a little more open to that type of financing," he said.
Wednesday, June 21, 2006
Broward Property tax cut by 9%!
Broward cuts property tax by 9%, but referendums could raise bills.
By Scott Wyman South Florida Sun-Sentinel Posted June 21 2006
Area homeowners this fall will see the largest reduction in property tax rates for county services in at least a decade, but they could be asked to pay more to build new courthouses and improve mass transit.Broward County commissioners Tuesday agreed to cut the property tax rate at least 9 percent in light of the mammoth growth in real estate values last year. The move was partly in recognition of the high housing costs many residents face and partly to pave the way with goodwill for the twin tax increases commissioners may propose. The average taxpayer who owns a $168,000 house with a homestead exemption would save $59 over last year's tax bill.
Commissioners also unanimously ordered their staff to draw up a referendum for the November ballot to borrow about $500 million to improve the court system. And skeptical commissioners heard a final appeal by transit proponents to ask voters to pay a penny more in sales tax to build a light-rail system and improve bus service.The tax rate cut from $6.80 to $6.20 per $1,000 of assessed valuation is more than twice as large as the cut commissioners approved last year, but it still does not return the entire revenue increase county coffers will reap from the 19 percent growth in the tax base last year. Despite Hurricane Wilma and a year-end cool-down in the real estate market, the tax base grew faster than ever and now totals $157 billion."You can only ask the public to do so much without also giving something back," County Mayor Ben Graber said of the timing of the tax rate cut and tax hike talk.Rising property values, though, mean the tax burden will continue to grow significantly for home buyers and those who do not have homestead protection, such as landlords, snowbirds and business owners. The owner of the average property without a homestead, valued at $312,000, will pay an extra $240 in county taxes.The tax rate cut could be larger if the final tax roll set by the Property Appraiser's Office on July 1 is more than the estimates released earlier this month. Commissioners will make a final decision on the rate at budget hearings in September.The proposed referendum would ask voters to increase property taxes to build a new high-rise courthouse in downtown Fort Lauderdale, remodel the newer wing of the existing building and build a satellite courthouse in the suburbs. The project would cost the average homeowner about $30 a year.The current courthouse, built a half-century ago, is in poor condition because of the wear and tear of 10,000 visitors a week. Officials argue the building is too small for Broward's caseload and growing population.A court tower with 53 courtrooms would be built at Southeast Third Avenue and Sixth Street next to the 110 Tower. The older section of the current courthouse would be leveled and reserved for a new federal courthouse. The location of the 12-courtroom satellite courthouse has not been decided.Although some commissioners said they wanted more details on the project before they decide in August whether to put the issue on the ballot, most vowed to support it."There is never a good time to ask the public for money, but we are literally at a crisis," Commissioner John Rodstrom said.The commission remained divided about the proposed transit tax, but will decide next week whether to give the go-ahead to a November referendum on that as well. A person making $50,000 would pay about $45 more in estimated sales tax under the proposal.The People for Progress coalition, led by construction executive James Cummings and former county commissioner John Hart, sought to ease concerns the group lacked plans on how the extra $260 million a year in revenue would be spent and who would control it.They mapped out a 20-year plan they have developed. The cornerstones of the plan would be commuter rail service along the Florida East Coast Railroad line and a new light-rail system running along State Road 7 and Interstate 595.Their proposal also would create three limited-stop bus routes along east-west corridors like Oakland Park Boulevard, potentially using dedicated lanes to speed up travel. The time between regular bus service on major routes at rush hour would be cut to 10 minutes, and express service would link western suburbs to downtown Fort Lauderdale, Miami and Boca Raton.Hart and Cummings pressed commissioners to set a November referendum, saying the county would lose out on millions of dollars in federal aid if no local money is earmarked this year.Scott Wyman can be reached at swyman@sun-sentinel.com or 954-356-4511.
By Scott Wyman South Florida Sun-Sentinel Posted June 21 2006
Area homeowners this fall will see the largest reduction in property tax rates for county services in at least a decade, but they could be asked to pay more to build new courthouses and improve mass transit.Broward County commissioners Tuesday agreed to cut the property tax rate at least 9 percent in light of the mammoth growth in real estate values last year. The move was partly in recognition of the high housing costs many residents face and partly to pave the way with goodwill for the twin tax increases commissioners may propose. The average taxpayer who owns a $168,000 house with a homestead exemption would save $59 over last year's tax bill.
Commissioners also unanimously ordered their staff to draw up a referendum for the November ballot to borrow about $500 million to improve the court system. And skeptical commissioners heard a final appeal by transit proponents to ask voters to pay a penny more in sales tax to build a light-rail system and improve bus service.The tax rate cut from $6.80 to $6.20 per $1,000 of assessed valuation is more than twice as large as the cut commissioners approved last year, but it still does not return the entire revenue increase county coffers will reap from the 19 percent growth in the tax base last year. Despite Hurricane Wilma and a year-end cool-down in the real estate market, the tax base grew faster than ever and now totals $157 billion."You can only ask the public to do so much without also giving something back," County Mayor Ben Graber said of the timing of the tax rate cut and tax hike talk.Rising property values, though, mean the tax burden will continue to grow significantly for home buyers and those who do not have homestead protection, such as landlords, snowbirds and business owners. The owner of the average property without a homestead, valued at $312,000, will pay an extra $240 in county taxes.The tax rate cut could be larger if the final tax roll set by the Property Appraiser's Office on July 1 is more than the estimates released earlier this month. Commissioners will make a final decision on the rate at budget hearings in September.The proposed referendum would ask voters to increase property taxes to build a new high-rise courthouse in downtown Fort Lauderdale, remodel the newer wing of the existing building and build a satellite courthouse in the suburbs. The project would cost the average homeowner about $30 a year.The current courthouse, built a half-century ago, is in poor condition because of the wear and tear of 10,000 visitors a week. Officials argue the building is too small for Broward's caseload and growing population.A court tower with 53 courtrooms would be built at Southeast Third Avenue and Sixth Street next to the 110 Tower. The older section of the current courthouse would be leveled and reserved for a new federal courthouse. The location of the 12-courtroom satellite courthouse has not been decided.Although some commissioners said they wanted more details on the project before they decide in August whether to put the issue on the ballot, most vowed to support it."There is never a good time to ask the public for money, but we are literally at a crisis," Commissioner John Rodstrom said.The commission remained divided about the proposed transit tax, but will decide next week whether to give the go-ahead to a November referendum on that as well. A person making $50,000 would pay about $45 more in estimated sales tax under the proposal.The People for Progress coalition, led by construction executive James Cummings and former county commissioner John Hart, sought to ease concerns the group lacked plans on how the extra $260 million a year in revenue would be spent and who would control it.They mapped out a 20-year plan they have developed. The cornerstones of the plan would be commuter rail service along the Florida East Coast Railroad line and a new light-rail system running along State Road 7 and Interstate 595.Their proposal also would create three limited-stop bus routes along east-west corridors like Oakland Park Boulevard, potentially using dedicated lanes to speed up travel. The time between regular bus service on major routes at rush hour would be cut to 10 minutes, and express service would link western suburbs to downtown Fort Lauderdale, Miami and Boca Raton.Hart and Cummings pressed commissioners to set a November referendum, saying the county would lose out on millions of dollars in federal aid if no local money is earmarked this year.Scott Wyman can be reached at swyman@sun-sentinel.com or 954-356-4511.
Tuesday, June 20, 2006
Proposal may force Palm Beach County landlords to screen for sex offenders.
Proposal may force Palm Beach County landlords to screen for sex offenders.
By Josh Hafenbrack South Florida Sun-Sentinel
Posted June 20 2006
Real estate organizations warn that homeowners would be stuck with law enforcement duties if Palm Beach County commissioners adopt new rules today that would wall off huge sections of the county to convicted sex offenders and predators.Local law enforcement officials also say the tighter restrictions might make it more difficult to keep tabs on the offenders because they would have fewer housing options and more temptation to go underground.
Mirroring steps taken by many cities and counties, Palm Beach County's proposal would prohibit sex offenders from living within 2,500 feet of public schools, bus stops, day-care centers, parks and playgrounds in unincorporated areas. The issue is set for consideration at today's meeting, which starts at 9:30 a.m. at the Governmental Center.The county defines sex offenders and predators as those who targeted victims younger than 16. State law bans them from living within 1,000 feet of schools and other places where children gather.At issue is whether homeowners should be forced to conduct background checks to make sure they don't sell or rent to sex offenders. Property owners could be faced with jail time and $500 fines for violating this requirement.It would force property owners "to become enforcers, to become screeners, to basically do the law enforcement's job," said Jennifer Butler, vice president for the Realtors Association of the Palm Beaches. "That isn't smart."There's no reason to create criminal penalties on people who are law-abiding citizens."Palm Beach County officials agreed that putting the onus on property owners creates problems. Nevertheless, some cities and counties have done just that. Wellington requires landlords to make a "good faith effort" to determine if their tenants are sexual predators. Miami-Dade County has a similar rule.Realtors Association President Bob Goldstein said Monday it would be an "administrative nightmare," because many property owners wouldn't know about the new sex offender rules and don't have the computer skills to run background searches.He put the problem this way: "I'm a seller and you show up at my door. What am I going to do? Am I going to ask you, `Are you a sexual predator?'""They may have a legitimate argument," conceded Commission Chairman Tony Masilotti, who sponsored the sex-offender ordinance.For law enforcement officials, a top concern is whether the 2,500-foot buffer actually would protect the public from sex offenders.With few legal housing options left, sex offenders might simply choose to live outside the law, said Palm Beach County Sheriff's Office Maj. Jim Stormes. About a dozen cities in Palm Beach County already have severely limited where sex offenders can live.There are about 800 sexual offenders in the county, more than half in unincorporated areas, Stormes said. Sex offenders who already live here wouldn't be affected by the new rules, unless they rent within the restricted buffer zone. They would have to move once their leases expire."If laws are incredibly restrictive on offenders, it could potentially make it almost impossible for them to live in many parts of the county," Stormes said. "It's important they do have a place to live, so we can monitor where they live."The Criminal Justice Commission puts it even more bluntly."If you look at the map, then you've got to start saying: Where is a legal residence for sex offenders?" Executive Director Diana Cunningham asks. "And if there are no legal residences because everyone has tried to look tough on crime, then in fact you do drive people underground."Assistant County Administrator Vince Bonvento said the county has not calculated how many housing options the 2,500-foot buffer would leave sex offenders."I don't even know where we'd start," he said. "When you're considering school bus stops, day-care centers, parks, playgrounds -- it's probably covering a lot of the unincorporated area."Masilotti, however, said he's not worried about driving sex offenders to live outside the law."If they don't report their whereabouts as predators, they go to jail," he said. "Anybody who preys on the youngest like that gets no sympathy from me whatsoever."
By Josh Hafenbrack South Florida Sun-Sentinel
Posted June 20 2006
Real estate organizations warn that homeowners would be stuck with law enforcement duties if Palm Beach County commissioners adopt new rules today that would wall off huge sections of the county to convicted sex offenders and predators.Local law enforcement officials also say the tighter restrictions might make it more difficult to keep tabs on the offenders because they would have fewer housing options and more temptation to go underground.
Mirroring steps taken by many cities and counties, Palm Beach County's proposal would prohibit sex offenders from living within 2,500 feet of public schools, bus stops, day-care centers, parks and playgrounds in unincorporated areas. The issue is set for consideration at today's meeting, which starts at 9:30 a.m. at the Governmental Center.The county defines sex offenders and predators as those who targeted victims younger than 16. State law bans them from living within 1,000 feet of schools and other places where children gather.At issue is whether homeowners should be forced to conduct background checks to make sure they don't sell or rent to sex offenders. Property owners could be faced with jail time and $500 fines for violating this requirement.It would force property owners "to become enforcers, to become screeners, to basically do the law enforcement's job," said Jennifer Butler, vice president for the Realtors Association of the Palm Beaches. "That isn't smart."There's no reason to create criminal penalties on people who are law-abiding citizens."Palm Beach County officials agreed that putting the onus on property owners creates problems. Nevertheless, some cities and counties have done just that. Wellington requires landlords to make a "good faith effort" to determine if their tenants are sexual predators. Miami-Dade County has a similar rule.Realtors Association President Bob Goldstein said Monday it would be an "administrative nightmare," because many property owners wouldn't know about the new sex offender rules and don't have the computer skills to run background searches.He put the problem this way: "I'm a seller and you show up at my door. What am I going to do? Am I going to ask you, `Are you a sexual predator?'""They may have a legitimate argument," conceded Commission Chairman Tony Masilotti, who sponsored the sex-offender ordinance.For law enforcement officials, a top concern is whether the 2,500-foot buffer actually would protect the public from sex offenders.With few legal housing options left, sex offenders might simply choose to live outside the law, said Palm Beach County Sheriff's Office Maj. Jim Stormes. About a dozen cities in Palm Beach County already have severely limited where sex offenders can live.There are about 800 sexual offenders in the county, more than half in unincorporated areas, Stormes said. Sex offenders who already live here wouldn't be affected by the new rules, unless they rent within the restricted buffer zone. They would have to move once their leases expire."If laws are incredibly restrictive on offenders, it could potentially make it almost impossible for them to live in many parts of the county," Stormes said. "It's important they do have a place to live, so we can monitor where they live."The Criminal Justice Commission puts it even more bluntly."If you look at the map, then you've got to start saying: Where is a legal residence for sex offenders?" Executive Director Diana Cunningham asks. "And if there are no legal residences because everyone has tried to look tough on crime, then in fact you do drive people underground."Assistant County Administrator Vince Bonvento said the county has not calculated how many housing options the 2,500-foot buffer would leave sex offenders."I don't even know where we'd start," he said. "When you're considering school bus stops, day-care centers, parks, playgrounds -- it's probably covering a lot of the unincorporated area."Masilotti, however, said he's not worried about driving sex offenders to live outside the law."If they don't report their whereabouts as predators, they go to jail," he said. "Anybody who preys on the youngest like that gets no sympathy from me whatsoever."
Monday, June 19, 2006
Forclosure Auction Buyers Losing Interest in Housing Inventory
Forclosure Auction Buyers Losing Interest in Housing Inventory
How can you really tell that the real estate market in some regions has peaked and is on its way down? When the auctions at the county courthouse are not attracting the buyers they once did and those properties are having a hard time selling. When a home is foreclosed upon it typically is sold by auction at the county courthouse.
And in this age of Carlton Sheets and all of the other no money down courses for people looking to get rich selling real estate advertised incessantly on the television flocking to the courthouse to get the deal of a lifetime, this is amazing. The amateurs that would bid up homes past the point of profitability following the concepts of these courthouses is the bane of all the people who have bought and sold homes over the years.
But now even these folks have understood that homes that are mortgaged to the hilt and have no equity in a market that is stagnant and has the potential to decline is not the smartest idea.
All of them are trying to scoop up homes that belonged to others who died, divorced, were thrust into bankruptcy or fell too far behind on their mortgage payments and failed to sell.But these days, those investors are having a harder time finding good deals, as the once red-hot housing market cools amid rising mortgage interest rates.
Many homes that do end up in court are saddled with more than one mortgage and have little or no equity - so the investors take a pass. “In the last six months or so, it has been like this,” said James Lee, who has mined trustee auctions for investment property for 15 years.
When home price increases were stronger, investors could buy a property and sell it a few months later for a hefty profit. “Now you’re getting into the market where there’s plenty to buy, but there’s nowhere to sell it,” said Peter Winn, owner of San Diego-based Westminster Investments.
How can you really tell that the real estate market in some regions has peaked and is on its way down? When the auctions at the county courthouse are not attracting the buyers they once did and those properties are having a hard time selling. When a home is foreclosed upon it typically is sold by auction at the county courthouse.
And in this age of Carlton Sheets and all of the other no money down courses for people looking to get rich selling real estate advertised incessantly on the television flocking to the courthouse to get the deal of a lifetime, this is amazing. The amateurs that would bid up homes past the point of profitability following the concepts of these courthouses is the bane of all the people who have bought and sold homes over the years.
But now even these folks have understood that homes that are mortgaged to the hilt and have no equity in a market that is stagnant and has the potential to decline is not the smartest idea.
All of them are trying to scoop up homes that belonged to others who died, divorced, were thrust into bankruptcy or fell too far behind on their mortgage payments and failed to sell.But these days, those investors are having a harder time finding good deals, as the once red-hot housing market cools amid rising mortgage interest rates.
Many homes that do end up in court are saddled with more than one mortgage and have little or no equity - so the investors take a pass. “In the last six months or so, it has been like this,” said James Lee, who has mined trustee auctions for investment property for 15 years.
When home price increases were stronger, investors could buy a property and sell it a few months later for a hefty profit. “Now you’re getting into the market where there’s plenty to buy, but there’s nowhere to sell it,” said Peter Winn, owner of San Diego-based Westminster Investments.
Sunday, June 18, 2006
Builders target fairways as Broward's open spaces disappear.
Builders target fairways as Broward's open spaces disappear.
By Buddy Nevins South Florida Sun-Sentinel
Posted June 18 2006
Less than six years after voters approved spending $400 million in bonds to preserve open space and revamp parks, most of the money has been spent and roughly 900 acres of Broward County land saved from development.The 2000 Safe Parks and Land Preservation Bond Program bankrolled the county's purchase of former orange groves, riverbanks, pinelands, wetlands, trailheads and slivers of beach.
What's left? Golf courses.To the dismay of many residents, developers increasingly eye these remaining chunks of green space for houses, condominiums and hotel rooms.Plans are in the works to build on more than 550 acres of courses in Coral Springs, Fort Lauderdale, Hollywood, Lauderhill, Margate, Oakland Park, Pembroke Pines and Tamarac, a South Florida Sun-Sentinel examination of development proposals, plans and interviews with city officials found."It's a function of the dwindling supply of land in Broward County. You are going to see a lot more golf courses being redeveloped," predicted Dennis Mele, a land-use lawyer whose client wants to build on one of three Inverrary courses in Lauderhill.Builders see golf courses as the last remaining open space where large multimillion-dollar developments can be built. Politicians see benefits from increased property values and the large amount of cash that will flow into city hall. But many golf course neighbors prefer to keep the greens and large trees outside their windows rather than more houses and condominiums."They are destroying our way of life," said Sherry Taylor, who fears her quiet seniors community in Tamarac will be damaged by more than 750 new homes to be built on the Monterey and Sabal Palm golf-course sites.Politicians must weigh the anger of residents like Taylor against Broward's best-known lawyer-lobbyists, hired to pave the way for golf course redevelopment.The group of investors that wants to build houses on part of American Golfers Club in Fort Lauderdale includes County Commissioner Jim Scott. The investors hired former Fort Lauderdale City Attorney Don Hall to advocate their project.Beyond saying he was not a major investor in the project and that he would abstain from voting on it, Scott declined to comment.Prestige Homes, which wants to build on the courses in Tamarac, has hired not only the veteran land-use lawyer Jerry Knight, but also Beverly Stracher, who was Tamarac Mayor Beth Flansbaum-Talabisco's campaign strategist in the March election.Stracher explained her value to the developer: "I ran Beth Flansbaum-Talabisco's campaign so I know a lot about the city." Knight, who spoke for the developer, said he believes the project is best for Tamarac.Tamarac city commissioners in March unanimously took the first step toward allowing Prestige Homes to build on the two courses despite protests from hundreds of residents who wanted to preserve the 160 acres as open space.The project replacing the two Tamarac courses will generate more than $1 million in new city taxes than the courses provided, according to a study prepared for City Hall.Offsetting the city's tax benefit, the new development puts more cars on roads and more students in schools. The Sabal Palm project alone will add roughly two-dozen car trips a day compared to the traffic generated by a golf course, and more than 300 new students in classrooms costing public schools more than $1.8 million annually, according to school system and county data.In return for permission to develop two Tamarac golf courses, Prestige Homes agreed to donate 31 acres for recreation and earmarked $2 million to solve neighborhood traffic problems caused by the project. It also promised to sell 10 percent of the homes as affordable housing.The Tamarac deal came after negotiations between city officials and developers.Law professor Michael Allan Wolf said negotiations that consider the nearby residents are often the best route to take.Wolf, a University of Florida law school land-use expert, said governments could hinder and maybe stop golf course projects, if they wanted, because nearly every developer seeking to replace a golf course needs multiple city, county and state approvals. But turning down such projects may not be the best policy, Wolf said.
By Buddy Nevins South Florida Sun-Sentinel
Posted June 18 2006
Less than six years after voters approved spending $400 million in bonds to preserve open space and revamp parks, most of the money has been spent and roughly 900 acres of Broward County land saved from development.The 2000 Safe Parks and Land Preservation Bond Program bankrolled the county's purchase of former orange groves, riverbanks, pinelands, wetlands, trailheads and slivers of beach.
What's left? Golf courses.To the dismay of many residents, developers increasingly eye these remaining chunks of green space for houses, condominiums and hotel rooms.Plans are in the works to build on more than 550 acres of courses in Coral Springs, Fort Lauderdale, Hollywood, Lauderhill, Margate, Oakland Park, Pembroke Pines and Tamarac, a South Florida Sun-Sentinel examination of development proposals, plans and interviews with city officials found."It's a function of the dwindling supply of land in Broward County. You are going to see a lot more golf courses being redeveloped," predicted Dennis Mele, a land-use lawyer whose client wants to build on one of three Inverrary courses in Lauderhill.Builders see golf courses as the last remaining open space where large multimillion-dollar developments can be built. Politicians see benefits from increased property values and the large amount of cash that will flow into city hall. But many golf course neighbors prefer to keep the greens and large trees outside their windows rather than more houses and condominiums."They are destroying our way of life," said Sherry Taylor, who fears her quiet seniors community in Tamarac will be damaged by more than 750 new homes to be built on the Monterey and Sabal Palm golf-course sites.Politicians must weigh the anger of residents like Taylor against Broward's best-known lawyer-lobbyists, hired to pave the way for golf course redevelopment.The group of investors that wants to build houses on part of American Golfers Club in Fort Lauderdale includes County Commissioner Jim Scott. The investors hired former Fort Lauderdale City Attorney Don Hall to advocate their project.Beyond saying he was not a major investor in the project and that he would abstain from voting on it, Scott declined to comment.Prestige Homes, which wants to build on the courses in Tamarac, has hired not only the veteran land-use lawyer Jerry Knight, but also Beverly Stracher, who was Tamarac Mayor Beth Flansbaum-Talabisco's campaign strategist in the March election.Stracher explained her value to the developer: "I ran Beth Flansbaum-Talabisco's campaign so I know a lot about the city." Knight, who spoke for the developer, said he believes the project is best for Tamarac.Tamarac city commissioners in March unanimously took the first step toward allowing Prestige Homes to build on the two courses despite protests from hundreds of residents who wanted to preserve the 160 acres as open space.The project replacing the two Tamarac courses will generate more than $1 million in new city taxes than the courses provided, according to a study prepared for City Hall.Offsetting the city's tax benefit, the new development puts more cars on roads and more students in schools. The Sabal Palm project alone will add roughly two-dozen car trips a day compared to the traffic generated by a golf course, and more than 300 new students in classrooms costing public schools more than $1.8 million annually, according to school system and county data.In return for permission to develop two Tamarac golf courses, Prestige Homes agreed to donate 31 acres for recreation and earmarked $2 million to solve neighborhood traffic problems caused by the project. It also promised to sell 10 percent of the homes as affordable housing.The Tamarac deal came after negotiations between city officials and developers.Law professor Michael Allan Wolf said negotiations that consider the nearby residents are often the best route to take.Wolf, a University of Florida law school land-use expert, said governments could hinder and maybe stop golf course projects, if they wanted, because nearly every developer seeking to replace a golf course needs multiple city, county and state approvals. But turning down such projects may not be the best policy, Wolf said.
Saturday, June 17, 2006
There's No "Due on Sale Jail"
There's No "Due on Sale Jail"
by William Bronchick, Esq.
The "due-on-sale" clause is probably the most talked about, feared and misunderstood topic in real estate. This article will dispel any misunderstandings you may have about the due-on-sale and suggest a simple, yet effective strategy to get around it What is the Due-on-Sale Clause? Before we discuss how to get around the due-on-sale, we must understand what it is and where it came from. The due-on-sale (a.k.a "acceleration clause") is a provision in a mortgage document which gives the lender the right to demand payment of the remaining balance of the loan when the property is sold. It is a contractual right, not a law. This means that if title to the property is transferred, the bank may (or may not), at its option, decide to "call the loan due." An "assumable" loan is one which is secured by a mortgage which contains no due-on-sale provision. FHA-insured mortgages originated before 12/89 and VA-guaranteed loans originated before 2/88 contain no due-on-sale provisions. Nearly all loans originated today contain a "standard" due-on-sale clause which usually reads something like: "If all or any part of the property herein is transferred without the lender’s prior written consent, the lender may require all sums secured hereby immediately due and payable." Where Did the Due-on-Sale Dilemma Come From? Banks began inserting due-on-sale clauses in their mortgages in the 1970s when interest rates rose dramatically. Home buyers were assuming existing loans rather than borrowing new money from banks because the interest rates on existing loans were lower. The banks used the due-on-sale as a way to kill their own worst competition. They argued that the reason for the restriction was to be able to police who was living in the property, the collateral for their loan. This argument holds little water, since most banks haven't been enforcing due-on-sale violations since the early 80's when interest rates were high. In fact, Black's Law Dictionary defines the due-on-sale clause as a device for "preventing subsequent purchasers from assuming loans with lower than market interest rates." This idea was also confirmed by the Court in Community Title Co v. Roosevelt Savings & Loan 670 S.W.2d 895 (Mo.App. 1984): "The due-on-sale clause was a way of eliminating these low yielding loans as soon as the property was sold, so that it could re-loan the money at current higher rates or negotiate a higher rate in the event the purchaser assumed the existing loan." The homeowners fought the banks in court claiming that the enforcement of the due-on-sale was "unfair trade practice" and an "unreasonable restraint on the alienation of property." In state courts, many homeowners were winning the argument. See, e.g., Wellenkamp v. Bank of America, 21 Cal 3d 943 (1978). The banks ultimately won in a United States Supreme Court case, Fidelity Federal Savings and Loan Association v. de la Cuesta, 102 S.Ct. 3014, (1982). Congress thereafter passed the "Garn-St. Germain Federal Depositary Institutions Act" (12 U.S.C. 1701-j) which codified the enforceability of the due-on-sale clause, despite state statute or case law to the contrary. There is No "Due-on-Sale Jail" Many people are under the mistaken impression that transferring title to a property secured by a "due-on-sale" mortgage is illegal. This is because most lay people confuse civil liability with criminal liability. To be "illegal," you must be in violation of a criminal law, code or statute. There is no federal or state law which makes it a crime to violate a due-on-sale clause. If the lender discovers the transfer, it may at its option, call the loan due and payable. If it cannot be paid, the lender has the option of commencing foreclosure proceedings. So the real question is: are you willing to take a property subject to a mortgage containing a due-on-sale clause with the risk of getting caught? The "Trust-Assignment Trick" The game for us is how to transfer ownership to the property without getting caught by the lender. You could simply get the owner to sign you a deed and not record it, but this method is problematic (for example, what if the seller gets a judgment against him?). Enter the "trust assignment trick . . . The Garn St. Germain Act carves several exceptions in which the lender may not enforce the due-on-sale: Exemption of Specified Transfers or Dispositions With respect to a real property loan secured by a lien on residential real property containing less than five dwelling units, including a lien on the stock allocated to a dwelling unit in a cooperative housing corporation, or on a residential manufactured home, a lender may not exercise its option pursuant to a due-on-sale clause upon - (1) the creation of a lien or other encumbrance subordinate to the lender's security instrument which does not relate to a transfer of rights of occupancy in the property; (2) the creation of a purchase money security interest for household appliances; (3) a transfer by devise, descent, or operation of law on the death of a joint tenant or tenant by the entirety; (4) the granting of a leasehold interest of three years or less not containing an option to purchase; (5) a transfer to a relative resulting from the death of a borrower; (6) a transfer where the spouse or children of the borrower become an owner of the property; (7) a transfer resulting from a decree of a dissolution of marriage, legal separation agreement, or from an incidental property settlement agreement, by which the spouse of the borrower becomes an owner of the property; ( a transfer into an inter-vivos trust in which the borrower is and remains a beneficiary and which does not relate to a transfer of rights of occupancy in the property; or (9) any other transfer or disposition described in regulations prescribed by the Federal Home Loan Bank Board. (The Federal Home Loan Bank Board, which was disbanded in 1989 and replaced by the Office of Thrift Supervision, takes the absurd position that the Act only applies to owner-occupied homes. See 12 C.F.R. 591. However, the clear language of Garn Act specifically states that it applies to residential one-to-four family homes. There is no mention that it must be "owner-occupied." Although never enforced or challenged, such a direct conflict with the meaning of the Congressional statute would probably be struck down in court as being "ultra vires". See, Sheldon, J. Repossessions & Foreclosures, Sec. 13.4.2.3.3). The Land Trust. A land trust is form of a revocable, living trust which is exempted under the Garn Act. A land trust, like a living trust, is create by two legal documents: 1) A trust agreement between the creator (called "grantor" in legal terms) of the trust and the trustee which defines the trust arrangement; and 2) A deed from the creator of the trust to the trustee. The trustee holds title for the benefit of the grantor (in this case, the grantor is also the "beneficiary"). If you place title to your property into a land trust, you have not violated the due-on-sale (so long as there is no change in occupancy). Let's say that you come across a seller who is willing to give you title to his property. The only "glitch" is that the loan is not assumable because the mortgage has a due-on-sale clause. Here's the process for getting around it: STEP 1: Sammy Seller signs a trust agreement with you as trustee of his trust. Sammy is named as the "beneficiary" of the trust. STEP 2: Sammy Seller transfers title to the trustee (no violation of the due-on-sale clause) STEP 3: Sammy Seller quietly assigns his interest under the trust to you (similar to a transfer of stock in a corporation). This assignment is not recorded in any public record. Sammy moves out and you move in. STEP 4: You are now the beneficiary of the trust. Your trustee makes payments to the lender. Keep in mind that the assignment of Sammy Seller's interest under the trust to you does trigger the due-on-sale, but who is going to tell the lender? In reality, the lender will discover the transfer of an interest in real estate in one of three ways: 1) Change of name on the deed. Not likely, since lenders don't readily have "spies" at the clerk's and recorder's office; 2) Different name on the check received for payment. Not likely, since the bank officers are far removed from the clerical workers who process payments; or 3) Change of hazard insurance beneficiary. This is the most common way a lender discovers a transfer of interest in the borrower's property. If you notify your insurance carrier of a change in insurance beneficiary, the lender, who is also a named beneficiary, receives a copy of the change. However, if you transferred title into a land trust, the new beneficiary under the insurance policy will be the trustee of the land trust. The lender will probably not object, since it will assume the seller has implemented an estate planning device. If the beneficiary of the trust is assigned, the lender will not be notified since the insurance beneficiary (the trustee) has not changed. This strategy is not much different than simply transferring title directly from seller to buyer (called taking a deed "subject to"). However, the chances of the lender discovering the change of ownership are greatly reduced. This is especially true where the lender has contracted to use a "servicing" company to deal with most facets of the loan. If you have had any experience with servicing companies, you may know that most are so poorly managed that they don't know which way is up (I would wager that a survey of 100 servicing company employees would reveal that 98 of them wouldn't know the meaning of a due-on-sale clause). But, but . . . isn't It is Unethical or Fraud? Note: This discussion is limited to the legal analysis of "ethics" rather than the moral one, namely whether you think it's "right or wrong" to try and get around a due on sale without telling the lender. I've found that such a discussion is pointless - only you can decide what's "right" for you. From a legal standpoint, a real estate agent who does not disclose the transfer to the lender has committed no breach of ethics. In fact, some of the standard contracts approved by the California Association of Realtors contain provisions contemplating a "subject to" transfer (see, e.g., form LRO-14, Residential Lease with Purchase Option). The Offical Utah Division of Real Estate forms also contain provisions for transfers in the face of a due-on-sale provision (see Seller Financing Addendum to REPC). Form 3248, the "official" real estate contract used by New York Attorneys (jointly prepared by the New York State Bar Association, the New York State Land Title Association), contains a specific paragraph contemplating the buyer taking "subject to" and existing mortgage. There is a law in MI (Sec 445.1628) that does make it a crime for a licensed agent to help someone evade a due on sale, but it only applies to the long-gone "window period" loans (originated between January 5, 1977, and ending on October 15, 1982). The state bars have no problem with lawyers helping clients conceal a transfer either. In Matter of Sabato, 560 N.E.2d 62 (Ind. 1990), the court found no ethical problem with an attorney helping a client circumvent a due-on-sale provision using a land trust as described
by William Bronchick, Esq.
The "due-on-sale" clause is probably the most talked about, feared and misunderstood topic in real estate. This article will dispel any misunderstandings you may have about the due-on-sale and suggest a simple, yet effective strategy to get around it What is the Due-on-Sale Clause? Before we discuss how to get around the due-on-sale, we must understand what it is and where it came from. The due-on-sale (a.k.a "acceleration clause") is a provision in a mortgage document which gives the lender the right to demand payment of the remaining balance of the loan when the property is sold. It is a contractual right, not a law. This means that if title to the property is transferred, the bank may (or may not), at its option, decide to "call the loan due." An "assumable" loan is one which is secured by a mortgage which contains no due-on-sale provision. FHA-insured mortgages originated before 12/89 and VA-guaranteed loans originated before 2/88 contain no due-on-sale provisions. Nearly all loans originated today contain a "standard" due-on-sale clause which usually reads something like: "If all or any part of the property herein is transferred without the lender’s prior written consent, the lender may require all sums secured hereby immediately due and payable." Where Did the Due-on-Sale Dilemma Come From? Banks began inserting due-on-sale clauses in their mortgages in the 1970s when interest rates rose dramatically. Home buyers were assuming existing loans rather than borrowing new money from banks because the interest rates on existing loans were lower. The banks used the due-on-sale as a way to kill their own worst competition. They argued that the reason for the restriction was to be able to police who was living in the property, the collateral for their loan. This argument holds little water, since most banks haven't been enforcing due-on-sale violations since the early 80's when interest rates were high. In fact, Black's Law Dictionary defines the due-on-sale clause as a device for "preventing subsequent purchasers from assuming loans with lower than market interest rates." This idea was also confirmed by the Court in Community Title Co v. Roosevelt Savings & Loan 670 S.W.2d 895 (Mo.App. 1984): "The due-on-sale clause was a way of eliminating these low yielding loans as soon as the property was sold, so that it could re-loan the money at current higher rates or negotiate a higher rate in the event the purchaser assumed the existing loan." The homeowners fought the banks in court claiming that the enforcement of the due-on-sale was "unfair trade practice" and an "unreasonable restraint on the alienation of property." In state courts, many homeowners were winning the argument. See, e.g., Wellenkamp v. Bank of America, 21 Cal 3d 943 (1978). The banks ultimately won in a United States Supreme Court case, Fidelity Federal Savings and Loan Association v. de la Cuesta, 102 S.Ct. 3014, (1982). Congress thereafter passed the "Garn-St. Germain Federal Depositary Institutions Act" (12 U.S.C. 1701-j) which codified the enforceability of the due-on-sale clause, despite state statute or case law to the contrary. There is No "Due-on-Sale Jail" Many people are under the mistaken impression that transferring title to a property secured by a "due-on-sale" mortgage is illegal. This is because most lay people confuse civil liability with criminal liability. To be "illegal," you must be in violation of a criminal law, code or statute. There is no federal or state law which makes it a crime to violate a due-on-sale clause. If the lender discovers the transfer, it may at its option, call the loan due and payable. If it cannot be paid, the lender has the option of commencing foreclosure proceedings. So the real question is: are you willing to take a property subject to a mortgage containing a due-on-sale clause with the risk of getting caught? The "Trust-Assignment Trick" The game for us is how to transfer ownership to the property without getting caught by the lender. You could simply get the owner to sign you a deed and not record it, but this method is problematic (for example, what if the seller gets a judgment against him?). Enter the "trust assignment trick . . . The Garn St. Germain Act carves several exceptions in which the lender may not enforce the due-on-sale: Exemption of Specified Transfers or Dispositions With respect to a real property loan secured by a lien on residential real property containing less than five dwelling units, including a lien on the stock allocated to a dwelling unit in a cooperative housing corporation, or on a residential manufactured home, a lender may not exercise its option pursuant to a due-on-sale clause upon - (1) the creation of a lien or other encumbrance subordinate to the lender's security instrument which does not relate to a transfer of rights of occupancy in the property; (2) the creation of a purchase money security interest for household appliances; (3) a transfer by devise, descent, or operation of law on the death of a joint tenant or tenant by the entirety; (4) the granting of a leasehold interest of three years or less not containing an option to purchase; (5) a transfer to a relative resulting from the death of a borrower; (6) a transfer where the spouse or children of the borrower become an owner of the property; (7) a transfer resulting from a decree of a dissolution of marriage, legal separation agreement, or from an incidental property settlement agreement, by which the spouse of the borrower becomes an owner of the property; ( a transfer into an inter-vivos trust in which the borrower is and remains a beneficiary and which does not relate to a transfer of rights of occupancy in the property; or (9) any other transfer or disposition described in regulations prescribed by the Federal Home Loan Bank Board. (The Federal Home Loan Bank Board, which was disbanded in 1989 and replaced by the Office of Thrift Supervision, takes the absurd position that the Act only applies to owner-occupied homes. See 12 C.F.R. 591. However, the clear language of Garn Act specifically states that it applies to residential one-to-four family homes. There is no mention that it must be "owner-occupied." Although never enforced or challenged, such a direct conflict with the meaning of the Congressional statute would probably be struck down in court as being "ultra vires". See, Sheldon, J. Repossessions & Foreclosures, Sec. 13.4.2.3.3). The Land Trust. A land trust is form of a revocable, living trust which is exempted under the Garn Act. A land trust, like a living trust, is create by two legal documents: 1) A trust agreement between the creator (called "grantor" in legal terms) of the trust and the trustee which defines the trust arrangement; and 2) A deed from the creator of the trust to the trustee. The trustee holds title for the benefit of the grantor (in this case, the grantor is also the "beneficiary"). If you place title to your property into a land trust, you have not violated the due-on-sale (so long as there is no change in occupancy). Let's say that you come across a seller who is willing to give you title to his property. The only "glitch" is that the loan is not assumable because the mortgage has a due-on-sale clause. Here's the process for getting around it: STEP 1: Sammy Seller signs a trust agreement with you as trustee of his trust. Sammy is named as the "beneficiary" of the trust. STEP 2: Sammy Seller transfers title to the trustee (no violation of the due-on-sale clause) STEP 3: Sammy Seller quietly assigns his interest under the trust to you (similar to a transfer of stock in a corporation). This assignment is not recorded in any public record. Sammy moves out and you move in. STEP 4: You are now the beneficiary of the trust. Your trustee makes payments to the lender. Keep in mind that the assignment of Sammy Seller's interest under the trust to you does trigger the due-on-sale, but who is going to tell the lender? In reality, the lender will discover the transfer of an interest in real estate in one of three ways: 1) Change of name on the deed. Not likely, since lenders don't readily have "spies" at the clerk's and recorder's office; 2) Different name on the check received for payment. Not likely, since the bank officers are far removed from the clerical workers who process payments; or 3) Change of hazard insurance beneficiary. This is the most common way a lender discovers a transfer of interest in the borrower's property. If you notify your insurance carrier of a change in insurance beneficiary, the lender, who is also a named beneficiary, receives a copy of the change. However, if you transferred title into a land trust, the new beneficiary under the insurance policy will be the trustee of the land trust. The lender will probably not object, since it will assume the seller has implemented an estate planning device. If the beneficiary of the trust is assigned, the lender will not be notified since the insurance beneficiary (the trustee) has not changed. This strategy is not much different than simply transferring title directly from seller to buyer (called taking a deed "subject to"). However, the chances of the lender discovering the change of ownership are greatly reduced. This is especially true where the lender has contracted to use a "servicing" company to deal with most facets of the loan. If you have had any experience with servicing companies, you may know that most are so poorly managed that they don't know which way is up (I would wager that a survey of 100 servicing company employees would reveal that 98 of them wouldn't know the meaning of a due-on-sale clause). But, but . . . isn't It is Unethical or Fraud? Note: This discussion is limited to the legal analysis of "ethics" rather than the moral one, namely whether you think it's "right or wrong" to try and get around a due on sale without telling the lender. I've found that such a discussion is pointless - only you can decide what's "right" for you. From a legal standpoint, a real estate agent who does not disclose the transfer to the lender has committed no breach of ethics. In fact, some of the standard contracts approved by the California Association of Realtors contain provisions contemplating a "subject to" transfer (see, e.g., form LRO-14, Residential Lease with Purchase Option). The Offical Utah Division of Real Estate forms also contain provisions for transfers in the face of a due-on-sale provision (see Seller Financing Addendum to REPC). Form 3248, the "official" real estate contract used by New York Attorneys (jointly prepared by the New York State Bar Association, the New York State Land Title Association), contains a specific paragraph contemplating the buyer taking "subject to" and existing mortgage. There is a law in MI (Sec 445.1628) that does make it a crime for a licensed agent to help someone evade a due on sale, but it only applies to the long-gone "window period" loans (originated between January 5, 1977, and ending on October 15, 1982). The state bars have no problem with lawyers helping clients conceal a transfer either. In Matter of Sabato, 560 N.E.2d 62 (Ind. 1990), the court found no ethical problem with an attorney helping a client circumvent a due-on-sale provision using a land trust as described
Strong job growth for Orlando..
Strong job growth for Orlando..
Harry Wessel Sentinel Staff Writer Posted June 16, 2006, 11:11 AM EDT
Florida and metro Orlando continued to enjoy strong job growth in May, with unemployment rates of 3.2 percent for the state and 2.8 percent for Orlando.Job growth for Florida over the past year was more than double that of the nation, the state's Agency for Workforce Innovation reported today. Between May 2005 and May 2006, the state added 270,600 new jobs, a growth rate of 3.5 percent increase compared with the nation's 1.4 percent."All indications are for continued strong job growth," said agency spokesman Warren May, adding that all sectors of the state's economy, particularly professional services and construction, were robust.Metro Orlando added 39,700 new jobs over the past year. Its 2.8 percent unemployment rate was down from 3.5 percent in May 2005.
Harry Wessel Sentinel Staff Writer Posted June 16, 2006, 11:11 AM EDT
Florida and metro Orlando continued to enjoy strong job growth in May, with unemployment rates of 3.2 percent for the state and 2.8 percent for Orlando.Job growth for Florida over the past year was more than double that of the nation, the state's Agency for Workforce Innovation reported today. Between May 2005 and May 2006, the state added 270,600 new jobs, a growth rate of 3.5 percent increase compared with the nation's 1.4 percent."All indications are for continued strong job growth," said agency spokesman Warren May, adding that all sectors of the state's economy, particularly professional services and construction, were robust.Metro Orlando added 39,700 new jobs over the past year. Its 2.8 percent unemployment rate was down from 3.5 percent in May 2005.
Thursday, June 15, 2006
Broward officials consider permanent restrictions on water lawns, washing cars
Broward officials consider permanent restrictions on water lawns, washing cars.
By Scott Wyman South Florida Sun-Sentinel Posted June 15 2006
Residents across Broward County may face permanent limits on when they can water lawns and wash cars, while cities could be forced to reuse wastewater rather than just dispose of it.It's all because South Florida is rapidly running out of a ready source of water.
Managers of the South Florida Water Management District told county commissioners during a meeting Wednesday that the era of a cheap and convenient water supply is at an end. The area's explosive growth and the ongoing restoration of the Everglades will require communities to conserve more and find alternative sources of water, district officials said."There is no more free water," district board member Malcolm "Bubba" Wade said. "It's not out there anymore."County commissioners said they recognize the problem. Commissioner Kristin Jacobs, the county's point person on water issues, estimated that communities in Broward have four years to take action or face a water crisis."There has been this laissez-faire attitude about water, but the district is doing business differently now," she said. "The utilities and cities aren't hearing the message. This is a freight train coming."Experts have warned for several years that Broward will soon face a water shortage as the Biscayne Aquifer, the primary source of South Florida's raw water, is sapped. State laws on controlling growth give the water management district a say in future developments. The district could tie up projects over questions of whether there is enough water to serve the new homes and businesses being proposed.Concerns about a need to revamp attitudes about water use have already come to a head in Miami-Dade County, foreshadowing what could happen in Broward.Miami-Dade officials had to strike a deal with the water district to get enough water to sustain growth for only the next 18 months rather than the 20 years they sought. The county was criticized for a shortsighted water policy and agreed to undertake more thorough studies and build a treatment facility to restore water to coastal wetlands.Water restrictions and wastewater reuse are common elsewhere in the state, but not in Broward.Broward only restricts water use, such as for lawn irrigation and car washing, during droughts. Mandatory water restrictions were imposed for 10 months during a 2001 drought, with hundreds of thousands of dollars in fines levied against those who broke the rules.The county reuses less wastewater for irrigation and other purposes than anywhere else in the region. According to the water district, Broward reuses 5 percent of its wastewater while Palm Beach reuses 30 percent and west and central Florida counties reuse 100 percent.Jacobs said about half of Broward's potable water is used for irrigation. She asked the water district for help exploring the legality of imposing a countywide restriction on water use rather than having to work through all its cities.Communities elsewhere in Florida have been quicker to adopt such regulations because local political leadership got behind the ideas earlier. They also have a more difficult time accessing the Biscayne Aquifer.Ron Bergeron, a Broward real estate mogul and Everglades restoration advocate, said after the meeting he hoped Broward officials understood the need for immediate change and took action. "You have two major issues: preservation of water and preservation of the Everglades," he said. "The Everglades can't serve as a reservoir. You can't save the Everglades and use it as a reservoir."
By Scott Wyman South Florida Sun-Sentinel Posted June 15 2006
Residents across Broward County may face permanent limits on when they can water lawns and wash cars, while cities could be forced to reuse wastewater rather than just dispose of it.It's all because South Florida is rapidly running out of a ready source of water.
Managers of the South Florida Water Management District told county commissioners during a meeting Wednesday that the era of a cheap and convenient water supply is at an end. The area's explosive growth and the ongoing restoration of the Everglades will require communities to conserve more and find alternative sources of water, district officials said."There is no more free water," district board member Malcolm "Bubba" Wade said. "It's not out there anymore."County commissioners said they recognize the problem. Commissioner Kristin Jacobs, the county's point person on water issues, estimated that communities in Broward have four years to take action or face a water crisis."There has been this laissez-faire attitude about water, but the district is doing business differently now," she said. "The utilities and cities aren't hearing the message. This is a freight train coming."Experts have warned for several years that Broward will soon face a water shortage as the Biscayne Aquifer, the primary source of South Florida's raw water, is sapped. State laws on controlling growth give the water management district a say in future developments. The district could tie up projects over questions of whether there is enough water to serve the new homes and businesses being proposed.Concerns about a need to revamp attitudes about water use have already come to a head in Miami-Dade County, foreshadowing what could happen in Broward.Miami-Dade officials had to strike a deal with the water district to get enough water to sustain growth for only the next 18 months rather than the 20 years they sought. The county was criticized for a shortsighted water policy and agreed to undertake more thorough studies and build a treatment facility to restore water to coastal wetlands.Water restrictions and wastewater reuse are common elsewhere in the state, but not in Broward.Broward only restricts water use, such as for lawn irrigation and car washing, during droughts. Mandatory water restrictions were imposed for 10 months during a 2001 drought, with hundreds of thousands of dollars in fines levied against those who broke the rules.The county reuses less wastewater for irrigation and other purposes than anywhere else in the region. According to the water district, Broward reuses 5 percent of its wastewater while Palm Beach reuses 30 percent and west and central Florida counties reuse 100 percent.Jacobs said about half of Broward's potable water is used for irrigation. She asked the water district for help exploring the legality of imposing a countywide restriction on water use rather than having to work through all its cities.Communities elsewhere in Florida have been quicker to adopt such regulations because local political leadership got behind the ideas earlier. They also have a more difficult time accessing the Biscayne Aquifer.Ron Bergeron, a Broward real estate mogul and Everglades restoration advocate, said after the meeting he hoped Broward officials understood the need for immediate change and took action. "You have two major issues: preservation of water and preservation of the Everglades," he said. "The Everglades can't serve as a reservoir. You can't save the Everglades and use it as a reservoir."
Wednesday, June 14, 2006
Housing market in transition
Housing market in transition.
National Association of Realtors chief economist David Lereah came to South Florida on Tuesday to discuss the future of housing in the region.
BY MATTHEW HAGGMAN
mhaggman@miamiherald.com
The housing standoff between buyers and sellers in South Florida will continue for another six months, and then prices in some areas will fall, a real estate trade group economist predicted Tuesday.
In some cases prices may fall by 10 percent to 15 percent, said David Lereah, the National Association of Realtors' chief economist, who spoke Tuesday in Coral Gables. But in many areas prices will still rise modestly this year, by 4 percent to 5 percent, he said. And when sellers finally bring asking prices down, pent-up demand will likely result in hordes of new buyers in South Florida.
The long-expected shakeout of the real estate market now underway is healthy for a region both overbuilt with new condominiums and overrun by speculators, Lereah said. Unlike in previous real estate downturns, the economic and demographic fundamentals underpinning South Florida real estate remain strong, he added.
So strong, in fact, that the Washington, D.C.-based economist is looking to buy some investment properties here himself.
''We are not in a crisis but a transition,'' said Lereah, speaking Tuesday at the International Real Estate Congress and Expo. ``I am very bullish in the long term for real estate in Florida.''
Lereah pegged the end of the housing boom to August 2005. That's when mortgage rates crept up and speculators fled.
Now, he said, home sales are declining. And the inventory of homes for sale has ballooned because stubborn sellers refuse to lower prices and buyers are ever willing to wait it out. Ultimately, he said, sellers will relent.
''When a transitioning market cools, it's the sales that drop first, and then prices,'' Lereah said.
Prices are likely to drop more for condos than for single-family homes, he said.
But in the long term, he is optimistic. Baby boomers continue to move here, international demand remains strong, unemployment in South Florida is low, and mortgage rates -- despite inching higher in recent months -- are still at historically low levels.
Just as important, Lereah said, the speculators are fleeing the market. He contends that speculators are most to blame for huge price hikes.
''Florida will be better for it with them gone,'' he said.
Lereah cited the increased threat of hurricanes and the availability of property insurance as South Florida's two biggest worries. Such worries, he said, are prompting some baby boomer and retirees to look away from Florida.
He noted a trend of baby boomers moving to places such as the Smoky Mountains in Tennessee and North Carolina.
But not Lereah.
''I was at another conference down here recently,'' he said. ``I drove around looking at property myself.''
So where is the chief economist for the national Realtor association buying?
National Association of Realtors chief economist David Lereah came to South Florida on Tuesday to discuss the future of housing in the region.
BY MATTHEW HAGGMAN
mhaggman@miamiherald.com
The housing standoff between buyers and sellers in South Florida will continue for another six months, and then prices in some areas will fall, a real estate trade group economist predicted Tuesday.
In some cases prices may fall by 10 percent to 15 percent, said David Lereah, the National Association of Realtors' chief economist, who spoke Tuesday in Coral Gables. But in many areas prices will still rise modestly this year, by 4 percent to 5 percent, he said. And when sellers finally bring asking prices down, pent-up demand will likely result in hordes of new buyers in South Florida.
The long-expected shakeout of the real estate market now underway is healthy for a region both overbuilt with new condominiums and overrun by speculators, Lereah said. Unlike in previous real estate downturns, the economic and demographic fundamentals underpinning South Florida real estate remain strong, he added.
So strong, in fact, that the Washington, D.C.-based economist is looking to buy some investment properties here himself.
''We are not in a crisis but a transition,'' said Lereah, speaking Tuesday at the International Real Estate Congress and Expo. ``I am very bullish in the long term for real estate in Florida.''
Lereah pegged the end of the housing boom to August 2005. That's when mortgage rates crept up and speculators fled.
Now, he said, home sales are declining. And the inventory of homes for sale has ballooned because stubborn sellers refuse to lower prices and buyers are ever willing to wait it out. Ultimately, he said, sellers will relent.
''When a transitioning market cools, it's the sales that drop first, and then prices,'' Lereah said.
Prices are likely to drop more for condos than for single-family homes, he said.
But in the long term, he is optimistic. Baby boomers continue to move here, international demand remains strong, unemployment in South Florida is low, and mortgage rates -- despite inching higher in recent months -- are still at historically low levels.
Just as important, Lereah said, the speculators are fleeing the market. He contends that speculators are most to blame for huge price hikes.
''Florida will be better for it with them gone,'' he said.
Lereah cited the increased threat of hurricanes and the availability of property insurance as South Florida's two biggest worries. Such worries, he said, are prompting some baby boomer and retirees to look away from Florida.
He noted a trend of baby boomers moving to places such as the Smoky Mountains in Tennessee and North Carolina.
But not Lereah.
''I was at another conference down here recently,'' he said. ``I drove around looking at property myself.''
So where is the chief economist for the national Realtor association buying?
Housing chief leaving his job after 18 months.
BROWARD COUNTY
Housing chief leaving his job after 18 months
Broward County and its affordable-housing director have parted ways.
BY ERIKA BOLSTAD
ebolstad@MiamiHerald.com
Broward County's housing chief, hired to great acclaim 18 months ago, quietly left his job with the county this week.
Joe Kocy, who was tasked with dreaming up and executing creative ways of tackling the county's affordable-housing crisis, lost the confidence of key administrators and county commissioners this spring. Kocy was a planning official in New Jersey and Maryland before coming to Broward in late 2004.
''The frustration was, in general, a lack of follow-through,'' said Commissioner Kristin Jacobs, who heads the commission's affordable-housing subcommittee. ``It became clear he wasn't the right person for the position.''
She and other commissioners who worked with Kocy described him as terrific at coming up with ideas, and said he had a thoughtful understanding of the challenges of developing affordable housing in a county where a steep increase in housing costs has made ownership unthinkable for many working people.
But commissioners also said they felt he was slow to respond to some of their requests, most notably a reorganization that would create a separate housing division within the county's Department of Urban Planning and Redevelopment. Kocy would have answered to the director of the department, which had already combined existing redevelopment and financing programs to focus on housing.
''I think that Mr. Kocy is a superb academic, but the issue is translating it into action,'' Commissioner Lois Wexler said.
Kocy had a poor performance review this spring, in which he was criticized as being responsible for the county's ''inability to gain meaningful momentum'' on housing issues. He did not get a raise and was given until the end of June to show improvement.
But by this week, both he and the interim county administrator, Bertha Henry, decided it would be best if they part ways, a decision she described on Tuesday as ``mutual separation.''
Kocy did not return a phone call left at his home Tuesday. In the response to his performance review, he said that obstacles to doing his job included the political tension over housing between commissioners and the former county administrator who hired him, Roger Desjarlais.
''I have worked diligently to ease that tension,'' Kocy wrote. ``The timetable has not been optimal, but political matters are beyond my ability to control.''
Kocy, who earns $126,000 a year, will stay on the payroll for the next three months, a typical separation agreement for county employees at top management levels.
Henry will immediately begin looking for his replacement, who will work under the Department of Urban Planning and Redevelopment once commissioners approve the reorganization.
Housing chief leaving his job after 18 months
Broward County and its affordable-housing director have parted ways.
BY ERIKA BOLSTAD
ebolstad@MiamiHerald.com
Broward County's housing chief, hired to great acclaim 18 months ago, quietly left his job with the county this week.
Joe Kocy, who was tasked with dreaming up and executing creative ways of tackling the county's affordable-housing crisis, lost the confidence of key administrators and county commissioners this spring. Kocy was a planning official in New Jersey and Maryland before coming to Broward in late 2004.
''The frustration was, in general, a lack of follow-through,'' said Commissioner Kristin Jacobs, who heads the commission's affordable-housing subcommittee. ``It became clear he wasn't the right person for the position.''
She and other commissioners who worked with Kocy described him as terrific at coming up with ideas, and said he had a thoughtful understanding of the challenges of developing affordable housing in a county where a steep increase in housing costs has made ownership unthinkable for many working people.
But commissioners also said they felt he was slow to respond to some of their requests, most notably a reorganization that would create a separate housing division within the county's Department of Urban Planning and Redevelopment. Kocy would have answered to the director of the department, which had already combined existing redevelopment and financing programs to focus on housing.
''I think that Mr. Kocy is a superb academic, but the issue is translating it into action,'' Commissioner Lois Wexler said.
Kocy had a poor performance review this spring, in which he was criticized as being responsible for the county's ''inability to gain meaningful momentum'' on housing issues. He did not get a raise and was given until the end of June to show improvement.
But by this week, both he and the interim county administrator, Bertha Henry, decided it would be best if they part ways, a decision she described on Tuesday as ``mutual separation.''
Kocy did not return a phone call left at his home Tuesday. In the response to his performance review, he said that obstacles to doing his job included the political tension over housing between commissioners and the former county administrator who hired him, Roger Desjarlais.
''I have worked diligently to ease that tension,'' Kocy wrote. ``The timetable has not been optimal, but political matters are beyond my ability to control.''
Kocy, who earns $126,000 a year, will stay on the payroll for the next three months, a typical separation agreement for county employees at top management levels.
Henry will immediately begin looking for his replacement, who will work under the Department of Urban Planning and Redevelopment once commissioners approve the reorganization.
Tuesday, June 13, 2006
FBI statistics indicate violent crime down in Broward's 5 largest cities.
FBI statistics indicate violent crime down in Broward's 5 largest cities.
By John Holland South Florida Sun-Sentinel Posted June 13 2006
Violent crime dropped in Broward County's largest cities last year, even as the number of property crimes and the total population of the cities increased slightly, according to statistics compiled by the FBI.The annual survey showed few sharp increases or decreases in most categories, and covered only the five Broward cities with populations greater than 100,000 -- Fort Lauderdale, Pembroke Pines, Hollywood, Coral Springs and Miramar.
The numbers are preliminary, with final figures to be released this fall.But the early figures are encouraging, local police officials said. Fort Lauderdale showed the largest overall increase in its crime rate, up 9 percent from 2004, and the number of murders in the city remained unchanged at 15.The biggest drop in overall crime came in Coral Springs, which saw a 17 percent decrease in crimes per 1,000 residents. Hollywood registered a 6 percent drop overall, with a slightly larger drop in murders, assault and other violent crime.The South Florida Sun-Sentinel adjusted all the figures for population increases and measured the crime rate per 1,000 residents."Chief [James] Scarberry was extremely pleased, and it does show the hard work and dedication of our employees," said Hollywood police spokesman Capt. Tony Rode. "But we're realistic and understand that the youth programs and the other work being done in the community play a big role. And, while nobody talks about it, luck plays a part in it, too."Fort Lauderdale's largest increase was in total property crimes -- including burglary, auto theft and all larceny -- which jumped to 11,215, an increase of 10 percent from a year earlier. But even with its increase, the city's total crime rate doesn't approach that of a decade ago, when it was consistently in the top 10 nationally.In 1996, Fort Lauderdale had a rate of 152 crimes per 1,000 residents. Last year, the city recorded 74 per 1,000, a drop of more than half.Miramar logged a higher number of crimes than in 2004, but its population jumped from 101,813 to 108,387, the largest increase in Broward. That meant the city's overall crime rate per 1,000 residents increased by 2 percent, while its violent crime rate dropped by one percent.The other four cities saw their populations increase by one percent. Because of annexation, Pompano Beach's population jumped over the 100,000 mark in 2005, but the city is not yet included in the FBI analysis.Miramar Police Capt. Bill Robertson said it's too early to comment on what the figures mean, adding his department is just beginning to digest the figures. Officials in Coral Springs also deferred comment, while a spokeswoman for the Fort Lauderdale Police could not be reached for comment.Robertson and Rode did say the numbers are just one way of measuring progress. One-year snapshots can also lead to statistical anomalies.For example, Pembroke Pines saw the number of murders jump from one in 2004 to six last year.Pembroke Pines Police Commander Dave Golt said three of those murders came in one incident. Adolph Jones was charged with killing his wife and two children, but has not yet gone to trial.Golt said the numbers are encouraging, and, like Rode, said the figures reflect a mix of luck and good law enforcement."Our aggravated assaults are way down, but truthfully there isn't a lot of proactive law enforcement that would account for that," Golt said. "But robberies and auto theft are also down, and I think that does relate directly to our public education programs and our strong presence on the streets."
By John Holland South Florida Sun-Sentinel Posted June 13 2006
Violent crime dropped in Broward County's largest cities last year, even as the number of property crimes and the total population of the cities increased slightly, according to statistics compiled by the FBI.The annual survey showed few sharp increases or decreases in most categories, and covered only the five Broward cities with populations greater than 100,000 -- Fort Lauderdale, Pembroke Pines, Hollywood, Coral Springs and Miramar.
The numbers are preliminary, with final figures to be released this fall.But the early figures are encouraging, local police officials said. Fort Lauderdale showed the largest overall increase in its crime rate, up 9 percent from 2004, and the number of murders in the city remained unchanged at 15.The biggest drop in overall crime came in Coral Springs, which saw a 17 percent decrease in crimes per 1,000 residents. Hollywood registered a 6 percent drop overall, with a slightly larger drop in murders, assault and other violent crime.The South Florida Sun-Sentinel adjusted all the figures for population increases and measured the crime rate per 1,000 residents."Chief [James] Scarberry was extremely pleased, and it does show the hard work and dedication of our employees," said Hollywood police spokesman Capt. Tony Rode. "But we're realistic and understand that the youth programs and the other work being done in the community play a big role. And, while nobody talks about it, luck plays a part in it, too."Fort Lauderdale's largest increase was in total property crimes -- including burglary, auto theft and all larceny -- which jumped to 11,215, an increase of 10 percent from a year earlier. But even with its increase, the city's total crime rate doesn't approach that of a decade ago, when it was consistently in the top 10 nationally.In 1996, Fort Lauderdale had a rate of 152 crimes per 1,000 residents. Last year, the city recorded 74 per 1,000, a drop of more than half.Miramar logged a higher number of crimes than in 2004, but its population jumped from 101,813 to 108,387, the largest increase in Broward. That meant the city's overall crime rate per 1,000 residents increased by 2 percent, while its violent crime rate dropped by one percent.The other four cities saw their populations increase by one percent. Because of annexation, Pompano Beach's population jumped over the 100,000 mark in 2005, but the city is not yet included in the FBI analysis.Miramar Police Capt. Bill Robertson said it's too early to comment on what the figures mean, adding his department is just beginning to digest the figures. Officials in Coral Springs also deferred comment, while a spokeswoman for the Fort Lauderdale Police could not be reached for comment.Robertson and Rode did say the numbers are just one way of measuring progress. One-year snapshots can also lead to statistical anomalies.For example, Pembroke Pines saw the number of murders jump from one in 2004 to six last year.Pembroke Pines Police Commander Dave Golt said three of those murders came in one incident. Adolph Jones was charged with killing his wife and two children, but has not yet gone to trial.Golt said the numbers are encouraging, and, like Rode, said the figures reflect a mix of luck and good law enforcement."Our aggravated assaults are way down, but truthfully there isn't a lot of proactive law enforcement that would account for that," Golt said. "But robberies and auto theft are also down, and I think that does relate directly to our public education programs and our strong presence on the streets."
Monday, June 12, 2006
Why Houses don`t sell!
Spring is the traditional peak sales season for houses and condos. Summer is also usually very good until the traditional August slump, especially for families who want to relocate before school starts. More prospective home buyers are in the market at this time of the year than during any other season.But 2006 is proving to be a bit different. Although 2005 was a record home sales volume year, the number of residence sales has slowed this year. There could be several reasons, such as adverse weather in many areas and slowly rising mortgage interest rates. In a few communities home sales prices have taken a slight dip, so prospective buyers might be waiting to see if desperate home sellers reduce their asking prices. Another reason for waiting to buy a house or condo is the inventory of available listings is slowly rising, thus offering more homes available for sale. In summary, for most communities it is definitely a "buyer's market." That means there are more homes listed for sale than there are qualified home buyers. The result can be bargain prices for savvy home buyers.
Top five reasons some homes don't sell
If your house or condo is listed for sale with a successful realty agent in your vicinity, there are five key reasons your home might not sell although nearby comparable residences are selling:1.) THE ASKING PRICE IS TOO HIGH. By far, this is the top reason a home doesn't sell. Although you might be just testing the market, prospective home buyers are very smart and they know an overpriced listing when they see it. Worse, their buyer's agents won't even bother showing homes with asking prices above recent sales prices of comparable nearby homes.
For this reason, if you want to get your home sold during this peak sales season, it is vital for your listing agent to keep you informed on a weekly basis of recent comparable home sales prices. Perhaps it's time for an asking price reduction.To illustrate, I was recently in Minneapolis. On my drives around the city and its suburbs, I was amazed at the considerable number of "price reduced" hangers on home-for-sale signs. That shows motivated home sellers (and their listing agents) are becoming more realistic.2.) THE LISTING AGENT DOESN'T MAKE THE HOME EASY TO SHOW. Well over 50 percent of home sales involve a listing agent and a buyer's agent. If the listing agent makes it difficult to show a home, such as requiring the listing agent be present for all showings, this discourages buyer's agents.
Unless there is a security reason, listed homes should always have a multiple listing service (MLS) lockbox key easily available for buyers' agent showings on short notice. As an investor, I've often bought a house with for sale signs I saw on the way to inspect another house. Lock boxes are especially important for buyer's agents with out-of-town transferees who have a short time available to inspect homes for purchase.A related problem can be the listing agent wants to "double end" the home sale by getting both the listing portion and the selling portion of the sales commission.
Although rare, some listing agents refuse to put their listings into the local MLS, thus preventing showings by buyer's agents. Or they might not put their listings on the Internet at www.Realtor.com and other Web sites where 70 percent of today's home buyers start their searches before contacting a local realty agent.3.) CONDITION OF THE HOME. Most home buyers want to purchase a residence in near "model home" condition where all they have to do is turn the key in the front door and move in. However, if the residence requires considerable work, that turns off all but the most die-hard bargain hunting home buyers.Fixer-upper homes appeal to a very limited market of home buyers. Sometimes known as "bottom fishers," they will purchase such homes only at bargain prices, well below what can be obtained with modest fix-up work such as painting (the most profitable improvement of all), repairing, and cleaning.
Word quickly spreads among local real estate agents when a home "doesn't show well." Buyers' agents will only show that residence to their bargain hunters, usually investors, who want to purchase far below market value.4.) "AS IS" HOME SALE CAN BE A RED FLAG TURN-OFF. Closely related to homes that don't show well are those listed for sale in "as is" condition. The term "as is" means the seller offers the residence in its current condition and will not pay for any repairs. However, the seller must still disclose in writing to buyers all known defects, such as a leaky roof or a bad foundation.
Personally, I've bought many "as is" houses at bargain prices. But I always include in my purchase offer a contingency clause for my professional inspection approval. If I don't approve the written report of my inspector, then I can cancel the purchase and get my good faith deposit refunded.Whenever possible, home sellers should not offer their homes for sale "as is" because it is like waving a red flag in the buyer's face. A better alternative is for the seller to obtain a professional inspection report and have the recommended repairs made before listing the home for sale.Of course, when a home needs a major repair that the seller either can't afford or doesn't want to make, then an "as is" sale at a reduced price is advisable.
5.) INEFFECTIVE MARKETING METHODS. In today's home "buyer's market" in most communities, listing agents and do-it-yourself "for sale by owner" home sellers must use every marketing resource available. Most effective is the for sale sign on the front lawn. A close second is weekly newspaper advertising, especially for a weekend open house. In third place is Internet advertising, especially at www.Realtor.com and other Web sites.In addition, listing agents have the local MLS and their special networking among agents who represent prospective buyers for the type of house or condo listed for sale. The local Association of Realtors is an especially effective resource to spread the word about a desirable home listed for sale. A key part of this sales technique is the "broker's tour" where only local agents are allowed to inspect a home for possible later showing to their buyers.
The best listing agents also use additional marketing methods, especially for their more expensive listings, such as color brochures and postcards mailed to nearby homeowners who may have friends who want to move to the area. Very expensive homes warrant the listing agent spending "big bucks" advertising residences in real estate magazine ads and offering Internet virtual tours.CONCLUSION. Selling houses and condos in the current buyer's market requires hard work by successful listing agents. If your home has been listed for sale with a successful realty agent over 45 days and without any purchase offers, it's time to discuss the five key reasons some homes don't sell with the listing agent and make adjustments to get your home sold.
Top five reasons some homes don't sell
If your house or condo is listed for sale with a successful realty agent in your vicinity, there are five key reasons your home might not sell although nearby comparable residences are selling:1.) THE ASKING PRICE IS TOO HIGH. By far, this is the top reason a home doesn't sell. Although you might be just testing the market, prospective home buyers are very smart and they know an overpriced listing when they see it. Worse, their buyer's agents won't even bother showing homes with asking prices above recent sales prices of comparable nearby homes.
For this reason, if you want to get your home sold during this peak sales season, it is vital for your listing agent to keep you informed on a weekly basis of recent comparable home sales prices. Perhaps it's time for an asking price reduction.To illustrate, I was recently in Minneapolis. On my drives around the city and its suburbs, I was amazed at the considerable number of "price reduced" hangers on home-for-sale signs. That shows motivated home sellers (and their listing agents) are becoming more realistic.2.) THE LISTING AGENT DOESN'T MAKE THE HOME EASY TO SHOW. Well over 50 percent of home sales involve a listing agent and a buyer's agent. If the listing agent makes it difficult to show a home, such as requiring the listing agent be present for all showings, this discourages buyer's agents.
Unless there is a security reason, listed homes should always have a multiple listing service (MLS) lockbox key easily available for buyers' agent showings on short notice. As an investor, I've often bought a house with for sale signs I saw on the way to inspect another house. Lock boxes are especially important for buyer's agents with out-of-town transferees who have a short time available to inspect homes for purchase.A related problem can be the listing agent wants to "double end" the home sale by getting both the listing portion and the selling portion of the sales commission.
Although rare, some listing agents refuse to put their listings into the local MLS, thus preventing showings by buyer's agents. Or they might not put their listings on the Internet at www.Realtor.com and other Web sites where 70 percent of today's home buyers start their searches before contacting a local realty agent.3.) CONDITION OF THE HOME. Most home buyers want to purchase a residence in near "model home" condition where all they have to do is turn the key in the front door and move in. However, if the residence requires considerable work, that turns off all but the most die-hard bargain hunting home buyers.Fixer-upper homes appeal to a very limited market of home buyers. Sometimes known as "bottom fishers," they will purchase such homes only at bargain prices, well below what can be obtained with modest fix-up work such as painting (the most profitable improvement of all), repairing, and cleaning.
Word quickly spreads among local real estate agents when a home "doesn't show well." Buyers' agents will only show that residence to their bargain hunters, usually investors, who want to purchase far below market value.4.) "AS IS" HOME SALE CAN BE A RED FLAG TURN-OFF. Closely related to homes that don't show well are those listed for sale in "as is" condition. The term "as is" means the seller offers the residence in its current condition and will not pay for any repairs. However, the seller must still disclose in writing to buyers all known defects, such as a leaky roof or a bad foundation.
Personally, I've bought many "as is" houses at bargain prices. But I always include in my purchase offer a contingency clause for my professional inspection approval. If I don't approve the written report of my inspector, then I can cancel the purchase and get my good faith deposit refunded.Whenever possible, home sellers should not offer their homes for sale "as is" because it is like waving a red flag in the buyer's face. A better alternative is for the seller to obtain a professional inspection report and have the recommended repairs made before listing the home for sale.Of course, when a home needs a major repair that the seller either can't afford or doesn't want to make, then an "as is" sale at a reduced price is advisable.
5.) INEFFECTIVE MARKETING METHODS. In today's home "buyer's market" in most communities, listing agents and do-it-yourself "for sale by owner" home sellers must use every marketing resource available. Most effective is the for sale sign on the front lawn. A close second is weekly newspaper advertising, especially for a weekend open house. In third place is Internet advertising, especially at www.Realtor.com and other Web sites.In addition, listing agents have the local MLS and their special networking among agents who represent prospective buyers for the type of house or condo listed for sale. The local Association of Realtors is an especially effective resource to spread the word about a desirable home listed for sale. A key part of this sales technique is the "broker's tour" where only local agents are allowed to inspect a home for possible later showing to their buyers.
The best listing agents also use additional marketing methods, especially for their more expensive listings, such as color brochures and postcards mailed to nearby homeowners who may have friends who want to move to the area. Very expensive homes warrant the listing agent spending "big bucks" advertising residences in real estate magazine ads and offering Internet virtual tours.CONCLUSION. Selling houses and condos in the current buyer's market requires hard work by successful listing agents. If your home has been listed for sale with a successful realty agent over 45 days and without any purchase offers, it's time to discuss the five key reasons some homes don't sell with the listing agent and make adjustments to get your home sold.
Sunday, June 11, 2006
A longtime public servant returns to County Hall to take on one of Miami-Dade's thorniest problems: the affordable-housing crunch
Curry's task: to fix housing crunch
A longtime public servant returns to County Hall to take on one of Miami-Dade's thorniest problems: the affordable-housing crunch.
BY LISA ARTHUR
larthur@MiamiHerald.com
When Cynthia Curry answered County Manager George Burgess' call to return to public service three months ago, she knew she was taking on one of the county's most urgent issues: the affordable-housing crunch for Miami-Dade's poor and working class amid a red-hot housing market that has seen costs spiral out of the reach of many.
Curry is no stranger to Miami-Dade County's longtime struggle to meet the housing needs of its poorest residents. During a stint as an assistant county manager from 1988 to 1995, her responsibilities included oversight of special housing programs. She is no stranger to crisis either. She served as South Dade hurricane recovery administrator after Hurricane Andrew pummeled the area.
Burgess is betting that Curry's experience can help him tackle what he thinks is one of the most urgent issues of his administration.
''We deal with a lot of hugely important issues in this county -- but I can't imagine any issue more important than affordable housing right now,'' Burgess said. ``I wanted us to be much more aggressive on this issue, and Cynthia is precisely the energy-driven type person we need.''
Curry knows she is taking on an old problem with new and more complex wrinkles.
''Housing has always been an issue for the lower class and lower middle class in this county,'' she said. ``But now it has moved up the economic level. It's hitting a whole new layer of people, moderate-income folks like teachers and police officers. I believe the problem is more highlighted now and more people are focusing on it because it's hitting all economic groups.''
She understands the urgency. If the county starts to lose its middle-class residents because they are priced out of housing, it could hobble the economy for decades to come, she said.
''The people who are being affected are the backbone of any successful community,'' Curry said in a recent interview. ``We have to find solutions for the moderate-income folks while not forgetting about the very low-income residents who have been struggling for years.
``I'm here to drive this as quickly as I can and get things moving.''
FULL CIRCLE
Curry began her job as a senior advisor to Burgess on housing and economic development issues on Feb. 21. In a way, taking the job was coming full circle.
She grew up in East Palatka and found herself drawn to urban Miami. She attended the University of Miami, majoring in public policy and politics. She earned bachelor's and master's degrees.
Curry landed her first job with the county straight out of graduate school when she joined the budget office in 1978. She spent nine years there, rising to the rank of assistant director before switching to the manager's office and becoming an assistant county manager.
In 1995, she left public service to become an executive vice president in the business and finance division of Florida International University. After three years, she moved on to start her own consulting firm.
That's where she was when Burgess asked her to come back to help him attack the housing crunch.
Curry's first move: surveying the state of affordable housing in Miami-Dade. She tapped departments throughout the government to put together a study that sets the base line of where the county is right now and begins to measure what the demand for affordable housing will be in coming years.
The study's conclusion: Miami-Dade's recent prosperity and real-estate boom have had a flip side, and the county is in an affordable-housing crisis.
Not only are moderate-income earners having trouble buying homes, but those on the lower end of the income spectrum can't find affordable places to rent.
''Renters might be the most vulnerable out there in the housing market right now,'' Curry said. ``Occupancy rates are at all-time highs, and developers aren't building a lot of new affordable apartments right now.''
Curry's next steps: evaluating existing county programs, taking an inventory of public and Section 8 federally subsidized housing and figuring out where the weaknesses are. Audit reports and reviews are expected in 90 days.
She acknowledges that some programs, such as using tax money earmarked to build affordable housing, have bogged down over the years.
SEEKING SOLUTIONS
Another area she has targeted: figuring out how much vacant land the county owns and could use for affordable housing -- either by enticing developers to build on it or by building itself.
For instance, the county's Water and Sewer Department owns about 600 parcels of vacant land. They are being inventoried to see what could be used for housing.
One solution would be to seek bids from developers who would build projects on county land and sign agreements to keep rents or sale prices affordable for decades.
Curry said her biggest challenge will be to persuade developers to work with the county to build affordable rentals, condos, townhomes and single-family houses.
''How can we create incentives for them to do those things? That's one of the things we have to figure out quickly,'' she said. One option could be to offer developers the right to build more units on a site than current laws allow -- known as density bonuses -- in exchange for including affordable housing in their projects.
But she knows it will likely be three to five years before any housing, whether on county-owned land or elsewhere, is built.
What to do in the meantime?
Team up with the assistant county manager for social services, Mae Bryant, for one thing. The goal: to get resources the county has available to the neediest.
''We'll create SWAT teams and target areas where folks are suffering the most,'' Curry said.
A longtime public servant returns to County Hall to take on one of Miami-Dade's thorniest problems: the affordable-housing crunch.
BY LISA ARTHUR
larthur@MiamiHerald.com
When Cynthia Curry answered County Manager George Burgess' call to return to public service three months ago, she knew she was taking on one of the county's most urgent issues: the affordable-housing crunch for Miami-Dade's poor and working class amid a red-hot housing market that has seen costs spiral out of the reach of many.
Curry is no stranger to Miami-Dade County's longtime struggle to meet the housing needs of its poorest residents. During a stint as an assistant county manager from 1988 to 1995, her responsibilities included oversight of special housing programs. She is no stranger to crisis either. She served as South Dade hurricane recovery administrator after Hurricane Andrew pummeled the area.
Burgess is betting that Curry's experience can help him tackle what he thinks is one of the most urgent issues of his administration.
''We deal with a lot of hugely important issues in this county -- but I can't imagine any issue more important than affordable housing right now,'' Burgess said. ``I wanted us to be much more aggressive on this issue, and Cynthia is precisely the energy-driven type person we need.''
Curry knows she is taking on an old problem with new and more complex wrinkles.
''Housing has always been an issue for the lower class and lower middle class in this county,'' she said. ``But now it has moved up the economic level. It's hitting a whole new layer of people, moderate-income folks like teachers and police officers. I believe the problem is more highlighted now and more people are focusing on it because it's hitting all economic groups.''
She understands the urgency. If the county starts to lose its middle-class residents because they are priced out of housing, it could hobble the economy for decades to come, she said.
''The people who are being affected are the backbone of any successful community,'' Curry said in a recent interview. ``We have to find solutions for the moderate-income folks while not forgetting about the very low-income residents who have been struggling for years.
``I'm here to drive this as quickly as I can and get things moving.''
FULL CIRCLE
Curry began her job as a senior advisor to Burgess on housing and economic development issues on Feb. 21. In a way, taking the job was coming full circle.
She grew up in East Palatka and found herself drawn to urban Miami. She attended the University of Miami, majoring in public policy and politics. She earned bachelor's and master's degrees.
Curry landed her first job with the county straight out of graduate school when she joined the budget office in 1978. She spent nine years there, rising to the rank of assistant director before switching to the manager's office and becoming an assistant county manager.
In 1995, she left public service to become an executive vice president in the business and finance division of Florida International University. After three years, she moved on to start her own consulting firm.
That's where she was when Burgess asked her to come back to help him attack the housing crunch.
Curry's first move: surveying the state of affordable housing in Miami-Dade. She tapped departments throughout the government to put together a study that sets the base line of where the county is right now and begins to measure what the demand for affordable housing will be in coming years.
The study's conclusion: Miami-Dade's recent prosperity and real-estate boom have had a flip side, and the county is in an affordable-housing crisis.
Not only are moderate-income earners having trouble buying homes, but those on the lower end of the income spectrum can't find affordable places to rent.
''Renters might be the most vulnerable out there in the housing market right now,'' Curry said. ``Occupancy rates are at all-time highs, and developers aren't building a lot of new affordable apartments right now.''
Curry's next steps: evaluating existing county programs, taking an inventory of public and Section 8 federally subsidized housing and figuring out where the weaknesses are. Audit reports and reviews are expected in 90 days.
She acknowledges that some programs, such as using tax money earmarked to build affordable housing, have bogged down over the years.
SEEKING SOLUTIONS
Another area she has targeted: figuring out how much vacant land the county owns and could use for affordable housing -- either by enticing developers to build on it or by building itself.
For instance, the county's Water and Sewer Department owns about 600 parcels of vacant land. They are being inventoried to see what could be used for housing.
One solution would be to seek bids from developers who would build projects on county land and sign agreements to keep rents or sale prices affordable for decades.
Curry said her biggest challenge will be to persuade developers to work with the county to build affordable rentals, condos, townhomes and single-family houses.
''How can we create incentives for them to do those things? That's one of the things we have to figure out quickly,'' she said. One option could be to offer developers the right to build more units on a site than current laws allow -- known as density bonuses -- in exchange for including affordable housing in their projects.
But she knows it will likely be three to five years before any housing, whether on county-owned land or elsewhere, is built.
What to do in the meantime?
Team up with the assistant county manager for social services, Mae Bryant, for one thing. The goal: to get resources the county has available to the neediest.
''We'll create SWAT teams and target areas where folks are suffering the most,'' Curry said.
Saturday, June 10, 2006
Boom boosts tax revenue.
TAVARES -- A construction boom and blazing real-estate market sent Lake County's taxable property soaring by 31 percent -- shattering the record for the largest jump in a single year and producing a windfall of tax revenue for local government.Preliminary estimates show Lake has a taxable value of $18.6 billion -- double the worth since 2002. That much of an increase "shows people going crazy and standing in line last year to buy properties," Property Appraiser Ed Havill said. "They were afraid prices were going to get higher and higher and wanted to buy as quick as possible."
The figures reflect new construction and increases in business, residential and land values through the end of 2005, with south Lake experiencing the most explosive growth. Groveland showed the biggest boost in value among Lake's 14 cities, 72.7 percent, bringing its taxable value to $401.6 million."Groveland is a great place to live," Mayor James Smith said. "People want to move here."Much of the increase also can be attributed to annexations, which totaled nearly $62 million in value.Not far behind was Mascotte, where taxable values shot up 61.3 percent to 170.1 million. The increase was substantial in other cities, ranging from increases of 20.3 percent in Eustis to 36.9 percent in Minneola.Clermont and Leesburg, which are Nos. 1 and 2 in population in Lake County, also were first and second in taxable value. Clermont's taxable value stands at $2 billion, a 30.8 percent rise from the previous year, with Leesburg at $1.3 billion, a 21.9 percent increase.The values are compiled each year by Havill's office. Local governments use the figures to determine property tax rates for the coming budget year. A larger tax roll means more money for governments unless governments "rolled back" the tax rate to produce the same amount of tax revenue as last year, not counting tax money generated by new construction.The ballooning tax roll means big increases in tax money for local governments. The county would see revenue increase from $82.3 million to almost $108 million, assuming no change in the tax rate.Officials with the two cities that saw the biggest percentage leap, Groveland and Mascotte, say it's too early to say if they will cut the tax rate to raise as much revenue as their cities did last year, saying the growth will add demands on roads, fire-protection and public safety.Mascotte City Manager Marge Strausbaugh said the city's population has doubled in the last six years to about 5,000 people.The additional tax revenue, Strausbaugh added, will help pay for that growth."We'll need it if we want to maintain adequate levels of service," she said.
The figures reflect new construction and increases in business, residential and land values through the end of 2005, with south Lake experiencing the most explosive growth. Groveland showed the biggest boost in value among Lake's 14 cities, 72.7 percent, bringing its taxable value to $401.6 million."Groveland is a great place to live," Mayor James Smith said. "People want to move here."Much of the increase also can be attributed to annexations, which totaled nearly $62 million in value.Not far behind was Mascotte, where taxable values shot up 61.3 percent to 170.1 million. The increase was substantial in other cities, ranging from increases of 20.3 percent in Eustis to 36.9 percent in Minneola.Clermont and Leesburg, which are Nos. 1 and 2 in population in Lake County, also were first and second in taxable value. Clermont's taxable value stands at $2 billion, a 30.8 percent rise from the previous year, with Leesburg at $1.3 billion, a 21.9 percent increase.The values are compiled each year by Havill's office. Local governments use the figures to determine property tax rates for the coming budget year. A larger tax roll means more money for governments unless governments "rolled back" the tax rate to produce the same amount of tax revenue as last year, not counting tax money generated by new construction.The ballooning tax roll means big increases in tax money for local governments. The county would see revenue increase from $82.3 million to almost $108 million, assuming no change in the tax rate.Officials with the two cities that saw the biggest percentage leap, Groveland and Mascotte, say it's too early to say if they will cut the tax rate to raise as much revenue as their cities did last year, saying the growth will add demands on roads, fire-protection and public safety.Mascotte City Manager Marge Strausbaugh said the city's population has doubled in the last six years to about 5,000 people.The additional tax revenue, Strausbaugh added, will help pay for that growth."We'll need it if we want to maintain adequate levels of service," she said.
Friday, June 09, 2006
School district gets $25 million from state.
BROOKSVILLE — A $25 million windfall is coming to the Hernando County School District by state financiers to pay for school maintenance, repair, renovation and other capital expenses.
School officials have been hoping to get the extra funding for months. However, it wasn’t until late Wednesday evening that chief financial officer Deborah Bruggink got the news.
“They’ve been tight on the capital money,” Bruggink said about such funding from the state in the past. “I think in essence the money we previously have been given has gone for more portables. Portables are the fastest way to get classrooms out there.”
All that can change now.
“I think this money will help (the district) move toward more permanent buildings,” Bruggink said. “It won’t buy a school (they cost from $15 to $44 million), but it can be used to supplement (building).”
Schools facilities director Roland Bavota said it’s too early to tell which schools will get the money for additional space. He and his staff will review that information during the summer.
Facilities employees must first identify projects to be able to spend the dollars.
“We’re looking at where it makes sense to add permanent classroom space throughout the district,” Bavota said.
The windfall comes in three categories.
An increase of $340,443 was given to school maintenance giving that category a total of $1,206,699.
New construction dollars were increased by $1,400,748 bringing that total to $4,756,122; and the capital designation known as Classrooms for Kids received $23,227,656 — an increase of $21,627,656.
The news of the $25 million capital infusion comes at a time when school officials have expressed concern over being ranked 66th in operational expenses given by the state. Operational expenses pay for school salaries, benefits and school programs.
The 66th-place designation means that the local district receives fewer per-student dollars than most school districts in Florida, at $6,439 per student. Only Suwannee County receives fewer dollars per student.
However, none of that funding affects the building process. Bruggink believes that the increase in building dollars was granted to Hernando County because the district is considered close behind Flagler County’s school district in growth.
Flagler, one of the state’s fastest-growing counties, received nearly $33 million. Hernando County received $29,190,477 — a massive increase in capital dollars considering last year’s paltry assessment of $3,855,817.
“They’ve traditionally never totally funded school construction,” Bruggink said. “(The funding) may be somewhat based on the ages of the buildings, ratios they are seeing with the numbers and higher growth.”
Thus far, Bruggink and her staff have projected a 1,600-student increase for the coming 2006-2007 school year. She said during a Tuesday workshop that that projection might be a bit too high.
The actual numbers, according to past trends, may fall closer to 1,200 additional students, which represents about 2 percent growth from last year. Either way, Bruggink was far more conservative in projecting assessments for capital funding.
“The last big amount we received was $6 million,” Bruggink said.
This year, however, the state doled out larger capital amounts causing more than $1.5 billion to be assessed for school districts throughout the state.
Bruggink said it’s possible that the state is finally distributing more money to pay for the Class Size Amendment because the measurement efforts for decreasing class size will change this year.
Last year, the school district was measured on how it was decreasing class size on the district level. In October, area schools will be judged on whether they are meeting the class size requirements on a school level. Eventually, by the beginning of the 2010-2011 school year, each school district will be judged and penalized if they do not meet class size mandates at the class level.
The class level restricts each class to: 18 students in prekindergarten through third grade; 22 students in fourth through eighth grades and 25 students in ninth through 12th grades.
During the last legislative session, lawmakers attempted to identify if the Class Size Amendment for schools should be sent back to the voters. Those attempts failed. Bruggink said after those attempts failed, it’s possible that state lawmakers recognized that the class size requirements were here to stay.
“That has really forced the legislators to put money into education,” Bruggink said.
Regardless of the politics that surround capital funding, Bruggink is hopeful about the future.
“I’m optimistic that this may be the trend,” she said.
School officials have been hoping to get the extra funding for months. However, it wasn’t until late Wednesday evening that chief financial officer Deborah Bruggink got the news.
“They’ve been tight on the capital money,” Bruggink said about such funding from the state in the past. “I think in essence the money we previously have been given has gone for more portables. Portables are the fastest way to get classrooms out there.”
All that can change now.
“I think this money will help (the district) move toward more permanent buildings,” Bruggink said. “It won’t buy a school (they cost from $15 to $44 million), but it can be used to supplement (building).”
Schools facilities director Roland Bavota said it’s too early to tell which schools will get the money for additional space. He and his staff will review that information during the summer.
Facilities employees must first identify projects to be able to spend the dollars.
“We’re looking at where it makes sense to add permanent classroom space throughout the district,” Bavota said.
The windfall comes in three categories.
An increase of $340,443 was given to school maintenance giving that category a total of $1,206,699.
New construction dollars were increased by $1,400,748 bringing that total to $4,756,122; and the capital designation known as Classrooms for Kids received $23,227,656 — an increase of $21,627,656.
The news of the $25 million capital infusion comes at a time when school officials have expressed concern over being ranked 66th in operational expenses given by the state. Operational expenses pay for school salaries, benefits and school programs.
The 66th-place designation means that the local district receives fewer per-student dollars than most school districts in Florida, at $6,439 per student. Only Suwannee County receives fewer dollars per student.
However, none of that funding affects the building process. Bruggink believes that the increase in building dollars was granted to Hernando County because the district is considered close behind Flagler County’s school district in growth.
Flagler, one of the state’s fastest-growing counties, received nearly $33 million. Hernando County received $29,190,477 — a massive increase in capital dollars considering last year’s paltry assessment of $3,855,817.
“They’ve traditionally never totally funded school construction,” Bruggink said. “(The funding) may be somewhat based on the ages of the buildings, ratios they are seeing with the numbers and higher growth.”
Thus far, Bruggink and her staff have projected a 1,600-student increase for the coming 2006-2007 school year. She said during a Tuesday workshop that that projection might be a bit too high.
The actual numbers, according to past trends, may fall closer to 1,200 additional students, which represents about 2 percent growth from last year. Either way, Bruggink was far more conservative in projecting assessments for capital funding.
“The last big amount we received was $6 million,” Bruggink said.
This year, however, the state doled out larger capital amounts causing more than $1.5 billion to be assessed for school districts throughout the state.
Bruggink said it’s possible that the state is finally distributing more money to pay for the Class Size Amendment because the measurement efforts for decreasing class size will change this year.
Last year, the school district was measured on how it was decreasing class size on the district level. In October, area schools will be judged on whether they are meeting the class size requirements on a school level. Eventually, by the beginning of the 2010-2011 school year, each school district will be judged and penalized if they do not meet class size mandates at the class level.
The class level restricts each class to: 18 students in prekindergarten through third grade; 22 students in fourth through eighth grades and 25 students in ninth through 12th grades.
During the last legislative session, lawmakers attempted to identify if the Class Size Amendment for schools should be sent back to the voters. Those attempts failed. Bruggink said after those attempts failed, it’s possible that state lawmakers recognized that the class size requirements were here to stay.
“That has really forced the legislators to put money into education,” Bruggink said.
Regardless of the politics that surround capital funding, Bruggink is hopeful about the future.
“I’m optimistic that this may be the trend,” she said.
Thursday, June 08, 2006
Developers cheer rejection of affordable housing law by Lauderdale commission.
Developers cheer rejection of affordable housing law by Lauderdale commission.
By Brittany Wallman South Florida Sun-Sentinel Posted June 7 2006
FORT LAUDERDALE -- People looking for an affordable place to rent or buy won't be getting help from the city of Fort Lauderdale anytime soon.A majority of city commissioners killed a proposed law Tuesday that would have required developers to sell or rent 10 to 15 percent of their homes or condos at affordable prices, or to pay into a housing trust fund. The money would have been used to expand housing subsidies to the middle class, offering down payment assistance or low-interest loans.Commissioner Charlotte Rodstrom and Vice Mayor Christine Teel said the law needs a lot more work; Mayor Jim Naugle, who has called it akin to communism, said it is not necessary.The three said they would be willing to discuss a new version of the law, but not until October."The more we learn, the more questions it generates," said Vice Mayor Christine Teel."We are doing something," said Rodstrom. "We just want to make sure when it hits the street, it's perfect."The city will not allow any more residential projects downtown until an affordable housing law is passed, City Manager George Gretsas said.Otherwise, the vote was good news for the development industry, which was opposed to the measure.Developers and the building industry said if they're going to be forced to reduce rents and home prices, they should at least get some benefits to help make up for the extra costs. Benefits would include faster permitting and the ability to build more homes on their land.Resident Betty Horvath said the city is allowing affordable homes to be destroyed and replaced with townhouses that are ruining neighborhoods."I do not want to subsidize any home for any person," she told commissioners.But many people have clamored for help in today's high-priced housing market, particularly in recent weeks since Naugle said people just needed to work longer hours or settle for a condo.Jim Carras, head of the nonprofit Broward Housing Partnership, said the commission punted an issue that needs immediate attention. "I'm disappointed the city is not dealing with it as a workforce housing crisis," Carras said.Doug Coolman spoke on the business community's behalf, urging commissioners to pass a law, even if it's not the ultimate solution to a broad problem."You need to do something. We have to go out and subsidize employees' housing," he said.Commissioners Carlton Moore and Cindi Hutchinson wanted to move forward more quickly."I really thought we were going to be leaders in this," said Moore.And for Naugle, even October was too soon."Let's bring it back in January," he said, "and see what the marketplace is doing."
By Brittany Wallman South Florida Sun-Sentinel Posted June 7 2006
FORT LAUDERDALE -- People looking for an affordable place to rent or buy won't be getting help from the city of Fort Lauderdale anytime soon.A majority of city commissioners killed a proposed law Tuesday that would have required developers to sell or rent 10 to 15 percent of their homes or condos at affordable prices, or to pay into a housing trust fund. The money would have been used to expand housing subsidies to the middle class, offering down payment assistance or low-interest loans.Commissioner Charlotte Rodstrom and Vice Mayor Christine Teel said the law needs a lot more work; Mayor Jim Naugle, who has called it akin to communism, said it is not necessary.The three said they would be willing to discuss a new version of the law, but not until October."The more we learn, the more questions it generates," said Vice Mayor Christine Teel."We are doing something," said Rodstrom. "We just want to make sure when it hits the street, it's perfect."The city will not allow any more residential projects downtown until an affordable housing law is passed, City Manager George Gretsas said.Otherwise, the vote was good news for the development industry, which was opposed to the measure.Developers and the building industry said if they're going to be forced to reduce rents and home prices, they should at least get some benefits to help make up for the extra costs. Benefits would include faster permitting and the ability to build more homes on their land.Resident Betty Horvath said the city is allowing affordable homes to be destroyed and replaced with townhouses that are ruining neighborhoods."I do not want to subsidize any home for any person," she told commissioners.But many people have clamored for help in today's high-priced housing market, particularly in recent weeks since Naugle said people just needed to work longer hours or settle for a condo.Jim Carras, head of the nonprofit Broward Housing Partnership, said the commission punted an issue that needs immediate attention. "I'm disappointed the city is not dealing with it as a workforce housing crisis," Carras said.Doug Coolman spoke on the business community's behalf, urging commissioners to pass a law, even if it's not the ultimate solution to a broad problem."You need to do something. We have to go out and subsidize employees' housing," he said.Commissioners Carlton Moore and Cindi Hutchinson wanted to move forward more quickly."I really thought we were going to be leaders in this," said Moore.And for Naugle, even October was too soon."Let's bring it back in January," he said, "and see what the marketplace is doing."
Wednesday, June 07, 2006
Sanford:12-story condos on Marina Island, but city wants more standards.
Developer covets Sanford waterfront.
Project envisions 12-story condos on Marina Island, but city wants more standards.
Robert PeRez Sentinel Staff Writer Posted June 7, 2006
SANFORD -- A developer just wrapping up one large condo project on the downtown waterfront has another, even bigger one in the works.The Avenue on Palmetto's three towers would soar 12 stories above the city's Marina Island and include 409 condominiums, commercial space, an upscale restaurant and a parking garage possibly topped by tennis courts.The project would be just a few hundred yards from developer Bob Horian's other condo complex, the six-story Gateway at Riverwalk. The two developments, Horian said, would bring a commodity desperately needed to fuel downtown's long-sought revival -- warm bodies."We're selling a lifestyle here," he said.Horian isn't the first to propose intense housing downtown.In August, an investor group unveiled a massive, 24-story condominium a few blocks west of Gateway. That project, River's Edge, was quickly criticized for its sheer size and intensity, as well as for its proposed location next to a wastewater treatment plant. The site remains vacant, though the city still considers it an "active" project.City officials say they are leery of allowing more projects downtown until they can adopt some standards that would help control traffic, density and design, Planning Director Russ Gibson said.Horian, who says he has the financing available for his second project, has agreed to cooperate with a city consultant working on such guidelines. But he said that previous downtown studies have called for just what he's offering: waterfront housing with commercial development on the marina.For decades, the scenic waterfront has had sparse commercial development. Except for the Gateway development, the first phase of which is nearing completion, a city park and government buildings have the best views of Lake Monroe. The longest-running commercial businesses have been a privately operated marina on the island and the Rivership Romance, which sells daily excursions along the lake and the St. Johns River.The Avenue on Palmetto would drastically rework much of Marina Island by removing a hotel, two restaurants and an office complex, which are no more than two stories high. Horian also would add boat docks along the north shore.A handful of residents spoke against the project at a recent city-planning meeting. They complained about its intensity and potential effect on waterfront vistas and as well as traffic.They also criticized the long-term leases Horian and his partners hold on about two-thirds of the city-owned Marina Island.Under terms of those leases, Horian and his partners can remain for 69 years more and never pay the city more than $70,000 a year.But Horian said he's ready to offer an out to the city from the lease. If Sanford officials are willing to give him ownership of the western half of the island, he would relinquish much of the eastern half but build the city a waterfront park it has sought, complete with amenities, such as pavilions and public restrooms.Horian, who also has built two smaller retail buildings along the waterfront, said the latest condominium project is part of a bigger plan that includes building a new hotel and conference center a block away.That land is city-owned, as well.Horian has asked for the Palmetto project to go before the city's Planning and Zoning Commission next month. If approved, development wouldn't begin before the end of the year and would take up to three years to complete, Horian said.
Project envisions 12-story condos on Marina Island, but city wants more standards.
Robert PeRez Sentinel Staff Writer Posted June 7, 2006
SANFORD -- A developer just wrapping up one large condo project on the downtown waterfront has another, even bigger one in the works.The Avenue on Palmetto's three towers would soar 12 stories above the city's Marina Island and include 409 condominiums, commercial space, an upscale restaurant and a parking garage possibly topped by tennis courts.The project would be just a few hundred yards from developer Bob Horian's other condo complex, the six-story Gateway at Riverwalk. The two developments, Horian said, would bring a commodity desperately needed to fuel downtown's long-sought revival -- warm bodies."We're selling a lifestyle here," he said.Horian isn't the first to propose intense housing downtown.In August, an investor group unveiled a massive, 24-story condominium a few blocks west of Gateway. That project, River's Edge, was quickly criticized for its sheer size and intensity, as well as for its proposed location next to a wastewater treatment plant. The site remains vacant, though the city still considers it an "active" project.City officials say they are leery of allowing more projects downtown until they can adopt some standards that would help control traffic, density and design, Planning Director Russ Gibson said.Horian, who says he has the financing available for his second project, has agreed to cooperate with a city consultant working on such guidelines. But he said that previous downtown studies have called for just what he's offering: waterfront housing with commercial development on the marina.For decades, the scenic waterfront has had sparse commercial development. Except for the Gateway development, the first phase of which is nearing completion, a city park and government buildings have the best views of Lake Monroe. The longest-running commercial businesses have been a privately operated marina on the island and the Rivership Romance, which sells daily excursions along the lake and the St. Johns River.The Avenue on Palmetto would drastically rework much of Marina Island by removing a hotel, two restaurants and an office complex, which are no more than two stories high. Horian also would add boat docks along the north shore.A handful of residents spoke against the project at a recent city-planning meeting. They complained about its intensity and potential effect on waterfront vistas and as well as traffic.They also criticized the long-term leases Horian and his partners hold on about two-thirds of the city-owned Marina Island.Under terms of those leases, Horian and his partners can remain for 69 years more and never pay the city more than $70,000 a year.But Horian said he's ready to offer an out to the city from the lease. If Sanford officials are willing to give him ownership of the western half of the island, he would relinquish much of the eastern half but build the city a waterfront park it has sought, complete with amenities, such as pavilions and public restrooms.Horian, who also has built two smaller retail buildings along the waterfront, said the latest condominium project is part of a bigger plan that includes building a new hotel and conference center a block away.That land is city-owned, as well.Horian has asked for the Palmetto project to go before the city's Planning and Zoning Commission next month. If approved, development wouldn't begin before the end of the year and would take up to three years to complete, Horian said.
Tuesday, June 06, 2006
Residents of West Palm tower give up on hurricane repairs, may sell to developer.
Residents of West Palm tower give up on hurricane repairs, may sell to developer.
By Peter Franceschina South Florida Sun-Sentinel Posted June 6 2006
West Palm Beach -- It's gloomy and depressing inside Tower 1515, a 30-story condo perched on Flagler Drive that was left a tattered ruin by Hurricanes Frances and Jeanne in the summer of 2004.The views once were impressive up and down the Intracoastal, and across downtown, before all the plywood and plastic went up over the missing windows and sliding glass doors.
Only now, 20 months after the storms, are some residents giving up hope of reclaiming their former lives. There have been no insurance payouts. Work stopped on the building months ago. Money pressures continue to pile up. Many owners are taking a developer's offer to buy them out, some with relief, others with regret."Today is the day we decide to move on," said Gary Lobel, as he spent a recent afternoon taking out the custom wood cabinetry he had just finished installing in his 28th floor unit before the storms. "I'm putting this behind me."He sold his complete kitchen, with its high-end stainless steel stove and refrigerator, for $2,500 on eBay. He knows he could have gotten much more, but he wants to be done with it -- quickly. He had to move Friday to his second apartment, and he no longer has time for his old life.Lobel bought his place for $260,000 in December 2003, and spent another $85,000 in renovations. He couldn't put a price on the views of the Intracoastal and the Atlantic -- it was his dream to live this high in the air. On clear days, Boynton Beach shimmers in the distance."My unit didn't get any damage. I was one of the few who made it through, but that doesn't do any good when you're in a building that is almost condemned," Lobel said with resignation. "I put my whole life in this renovation from ceiling to floor and never got to enjoy it."One woman who lived in a penthouse spends hours chipping out the elaborate mosaics she inlaid in her granite floors, one tiny tile at a time. Others have sold off or given away appliances. Every unit has some damage, either from the storms or construction work, some much more than others.No one has lived in Tower 1515 for nearly a year, when those who remained in the building left so construction work could be sped up. But the construction company stopped work and is now suing the condo association for more than $2 million. The condo association is suing its insurance company in hopes of collecting at least $32 million for repairs.The association already has spent $7 million on repairs, said Lobel, who is on the board of directors, and barely made a dent in what needs to be done. The condo association is looking for financing to finish the repairs, but developers are circling, offering cash that's very tempting.Built in 1974 just south of downtown, Tower 1515 has 119 units, home to young professionals and retirees, lawyers, doctors, a police officer, an astronaut."It's been quite difficult, really," said board member Charles Dayian, who has lived in his 12th floor unit since 1998 and has now moved twice with his wife to apartments.Tampa attorney William Merlin, who represents the board in its lawsuit against the insurance carrier, said owners may be forced to sell if they don't secure financing soon."I think it's sad. It's just a horrible predicament that people have lost their homes and have to sell. It defeats the whole purpose of insurance if this is what happens," he said. "There are some people who are affluent, but there are others that are young or elderly and they have their life savings in this. It's very stressful. To face this situation is devastating."The board hired West Palm Beach attorney Daryl Cramer to help consider two buyout offers from developers."You have a bunch of homeowners who are out of their [homes]. They have been suffering greatly, and they really can't take it anymore," Cramer said. "People are feeling desperate that they have to sell."One developer, the Omega Group in Boca Raton, has offered to pay the owners $37 million, or roughly $310,000 per unit, Cramer said. Palm Beach resident Thanos Papalexis has offered two prices -- $55 million if the owners give him the rights to any insurance money, $45 million if they don't, Cramer said. Omega would tear Tower 1515 down; Papalexis has said he won't.The two development groups held meetings for the owners this week to pitch their proposals. Owners appear to be tilting toward Papalexis' offer, pitched Thursday night at The Breakers. He's encouraging owners to sign contracts in hopes of closing them by June 29. Owners say his aim is to get 75 percent of the units, or 91 of them, under contract."Once he gets that, he has control and can dissolve the association," Lobel said. "Anyone who refuses to sell is really saying, `I'm going to give my unit away.' It makes no sense."Les Lear, who lives in Timonium, Md., signed a Papalexis contract several weeks ago. He's more than ready to give up the winter home he has owned for more than 20 years."This could be going on five years from now. I'll probably be dead by then," said the 77-year-old Lear. "Psychologically, I am out of there. I have been out of there for several months. I want to get out as quickly as possible with what I can salvage."
By Peter Franceschina South Florida Sun-Sentinel Posted June 6 2006
West Palm Beach -- It's gloomy and depressing inside Tower 1515, a 30-story condo perched on Flagler Drive that was left a tattered ruin by Hurricanes Frances and Jeanne in the summer of 2004.The views once were impressive up and down the Intracoastal, and across downtown, before all the plywood and plastic went up over the missing windows and sliding glass doors.
Only now, 20 months after the storms, are some residents giving up hope of reclaiming their former lives. There have been no insurance payouts. Work stopped on the building months ago. Money pressures continue to pile up. Many owners are taking a developer's offer to buy them out, some with relief, others with regret."Today is the day we decide to move on," said Gary Lobel, as he spent a recent afternoon taking out the custom wood cabinetry he had just finished installing in his 28th floor unit before the storms. "I'm putting this behind me."He sold his complete kitchen, with its high-end stainless steel stove and refrigerator, for $2,500 on eBay. He knows he could have gotten much more, but he wants to be done with it -- quickly. He had to move Friday to his second apartment, and he no longer has time for his old life.Lobel bought his place for $260,000 in December 2003, and spent another $85,000 in renovations. He couldn't put a price on the views of the Intracoastal and the Atlantic -- it was his dream to live this high in the air. On clear days, Boynton Beach shimmers in the distance."My unit didn't get any damage. I was one of the few who made it through, but that doesn't do any good when you're in a building that is almost condemned," Lobel said with resignation. "I put my whole life in this renovation from ceiling to floor and never got to enjoy it."One woman who lived in a penthouse spends hours chipping out the elaborate mosaics she inlaid in her granite floors, one tiny tile at a time. Others have sold off or given away appliances. Every unit has some damage, either from the storms or construction work, some much more than others.No one has lived in Tower 1515 for nearly a year, when those who remained in the building left so construction work could be sped up. But the construction company stopped work and is now suing the condo association for more than $2 million. The condo association is suing its insurance company in hopes of collecting at least $32 million for repairs.The association already has spent $7 million on repairs, said Lobel, who is on the board of directors, and barely made a dent in what needs to be done. The condo association is looking for financing to finish the repairs, but developers are circling, offering cash that's very tempting.Built in 1974 just south of downtown, Tower 1515 has 119 units, home to young professionals and retirees, lawyers, doctors, a police officer, an astronaut."It's been quite difficult, really," said board member Charles Dayian, who has lived in his 12th floor unit since 1998 and has now moved twice with his wife to apartments.Tampa attorney William Merlin, who represents the board in its lawsuit against the insurance carrier, said owners may be forced to sell if they don't secure financing soon."I think it's sad. It's just a horrible predicament that people have lost their homes and have to sell. It defeats the whole purpose of insurance if this is what happens," he said. "There are some people who are affluent, but there are others that are young or elderly and they have their life savings in this. It's very stressful. To face this situation is devastating."The board hired West Palm Beach attorney Daryl Cramer to help consider two buyout offers from developers."You have a bunch of homeowners who are out of their [homes]. They have been suffering greatly, and they really can't take it anymore," Cramer said. "People are feeling desperate that they have to sell."One developer, the Omega Group in Boca Raton, has offered to pay the owners $37 million, or roughly $310,000 per unit, Cramer said. Palm Beach resident Thanos Papalexis has offered two prices -- $55 million if the owners give him the rights to any insurance money, $45 million if they don't, Cramer said. Omega would tear Tower 1515 down; Papalexis has said he won't.The two development groups held meetings for the owners this week to pitch their proposals. Owners appear to be tilting toward Papalexis' offer, pitched Thursday night at The Breakers. He's encouraging owners to sign contracts in hopes of closing them by June 29. Owners say his aim is to get 75 percent of the units, or 91 of them, under contract."Once he gets that, he has control and can dissolve the association," Lobel said. "Anyone who refuses to sell is really saying, `I'm going to give my unit away.' It makes no sense."Les Lear, who lives in Timonium, Md., signed a Papalexis contract several weeks ago. He's more than ready to give up the winter home he has owned for more than 20 years."This could be going on five years from now. I'll probably be dead by then," said the 77-year-old Lear. "Psychologically, I am out of there. I have been out of there for several months. I want to get out as quickly as possible with what I can salvage."
Monday, June 05, 2006
Builders' report says growth more than pays for itself.
Home builders in Volusia are trying to silence sprawl foes with a new report offering a debatable conclusion: Growth not only pays for itself, it makes money for local governments, according to an industry-developed study to be released today in Daytona Beach.The report surfaces as a citizen group and county government consider new growth controls for the November ballot.
The builders' report, completed by the National Association of Home Builders, concludes that the 6,983 single-family homes, apartments, condos and duplexes built in Volusia last year will pump more than $1 billion into the local economy in the next 15 years.During the same period, that development will cost city and county governments $488.7 million to pay for roads, utilities, schools, police, fire and other services, according to the study.That means a surplus of more than $500 million for local governments, the study concludes."Instinctively, we knew that growth pays for itself, but everybody is screaming that it doesn't, so we wanted a study done just to make sure," said Susan Darden, executive officer for the Volusia Home Builders Association. The report cost $500.The bottom line, according to the study, is that home builders foot the bill for government services, as well as generating millions for government coffers.But the findings of the home builders' study doesn't seem to fit with the reality faced by local governments, including Volusia County, which have raised fees for new roads, schools and other public services to keep up with growth.Last year, for example, the County Council more than quadrupled the one-time fees charged on new houses from $1,139 to $5,284 to help make growth pay more for schools -- a move home builders strongly opposed.Other counties in Central Florida have increased such fees in recent years.Clay Henderson, a land-use attorney and member of the county's smart-growth advisory committee, is skeptical of the construction industry's findings."What they [Volusia Builders Association] are saying is that their industry is going to carry the need," he said. "But what the rest of us are saying is that their numbers don't quite add up."Susan MacManus, a University of South Florida political-science professor, said the report comes amid mounting anti-sprawl sentiments because of rapid growth."They [home builders] sense animosity towards growth in Florida," MacManus said. "Any sector that is under attack is trying to defend themselves and show they pay their way."Two years ago, Volusia home builders won a legal battle to invalidate a measure approved by nearly 72 percent of voters to protect the rural core of Volusia and direct growth into urban areas. The same activists who supported that measure are trying to put two new slow-growth ballot questions before voters in November.Elliot Eisenberg, a National Association of Home Builders senior economist who conducted the study, said the building industry has been paying for public services and creating revenue across the country. Since 1997, his group has done such a study more than 350 times throughout the nation and reached the same conclusions.In Central Florida, the study has also been conducted in Polk and Flagler counties, Darden said.Those studies, according to news reports, have been met with praise and skepticism from citizens and public officials from coast to coast.Home building, Eisenberg said, generates a multiplier effect, where money circulates throughout the economy and generates different sources of revenue. He couldn't say why local governments are struggling for new revenue at a time of rapid growth. But he stood behind the study, which will be released at 10:30 a.m. today at 3520 W. International Speedway Blvd., and noted it was based on federal government data."Our methodology," he said, "is clear."
The builders' report, completed by the National Association of Home Builders, concludes that the 6,983 single-family homes, apartments, condos and duplexes built in Volusia last year will pump more than $1 billion into the local economy in the next 15 years.During the same period, that development will cost city and county governments $488.7 million to pay for roads, utilities, schools, police, fire and other services, according to the study.That means a surplus of more than $500 million for local governments, the study concludes."Instinctively, we knew that growth pays for itself, but everybody is screaming that it doesn't, so we wanted a study done just to make sure," said Susan Darden, executive officer for the Volusia Home Builders Association. The report cost $500.The bottom line, according to the study, is that home builders foot the bill for government services, as well as generating millions for government coffers.But the findings of the home builders' study doesn't seem to fit with the reality faced by local governments, including Volusia County, which have raised fees for new roads, schools and other public services to keep up with growth.Last year, for example, the County Council more than quadrupled the one-time fees charged on new houses from $1,139 to $5,284 to help make growth pay more for schools -- a move home builders strongly opposed.Other counties in Central Florida have increased such fees in recent years.Clay Henderson, a land-use attorney and member of the county's smart-growth advisory committee, is skeptical of the construction industry's findings."What they [Volusia Builders Association] are saying is that their industry is going to carry the need," he said. "But what the rest of us are saying is that their numbers don't quite add up."Susan MacManus, a University of South Florida political-science professor, said the report comes amid mounting anti-sprawl sentiments because of rapid growth."They [home builders] sense animosity towards growth in Florida," MacManus said. "Any sector that is under attack is trying to defend themselves and show they pay their way."Two years ago, Volusia home builders won a legal battle to invalidate a measure approved by nearly 72 percent of voters to protect the rural core of Volusia and direct growth into urban areas. The same activists who supported that measure are trying to put two new slow-growth ballot questions before voters in November.Elliot Eisenberg, a National Association of Home Builders senior economist who conducted the study, said the building industry has been paying for public services and creating revenue across the country. Since 1997, his group has done such a study more than 350 times throughout the nation and reached the same conclusions.In Central Florida, the study has also been conducted in Polk and Flagler counties, Darden said.Those studies, according to news reports, have been met with praise and skepticism from citizens and public officials from coast to coast.Home building, Eisenberg said, generates a multiplier effect, where money circulates throughout the economy and generates different sources of revenue. He couldn't say why local governments are struggling for new revenue at a time of rapid growth. But he stood behind the study, which will be released at 10:30 a.m. today at 3520 W. International Speedway Blvd., and noted it was based on federal government data."Our methodology," he said, "is clear."
Sunday, June 04, 2006
Tired of hurricanes and high prices, some South Floridians leaving for greener pastures.
Tired of hurricanes and high prices, some South Floridians leaving for greener pastures.
By Liz Doup South Florida Sun-Sentinel Posted June 4 2006
COLUMBIA, Tenn. -- Standing high on a hillside, John Mowery surveys his 91/2 acres, where cattle graze in the backyard and his two-story home is as much sanctuary as shelter."I'm not a religious man but I thank God every morning I'm here and not just dreaming," Mowery says. "I found a piece of heaven."
After 40 years in South Florida, Mowery and wife Lori recently moved to Tennessee, far from crowded streets, heavy development and costly houses.And no hurricanes.As Florida prepares for hurricane season, Mowery, 59, looks forward to a peaceful summer. All because he did what many Floridians only talk about: moving.Two horrific hurricane seasons haven't stopped people from flooding into Florida at the rate of 1,000 a day. But plenty -- 400 a day -- are heading out, to North Carolina, Georgia and points beyond.After the lashing of Hurricane Wilma, the October storm that plunged South Florida into darkness for weeks, a half dozen local families moved near Columbia, about 45 miles south of Nashville."I knew the cycle was getting worse," says Lori Mowery, 49. "I figured we'd end up getting hit good eventually."Moving to rural Tennessee isn't like moving to Atlanta or Charlotte, with their ample shopping, entertainment and a melting pot of people.Going to Columbia means going country. Floridians here want more than a new address. They want a new way of life.In this town of 38,000, tidy red brick homes nestle among rolling hills.Here, adults and children alike say "Yes, sir" and "No ma'am" and wave at strangers. The big annual event is Mule Day, which features 400 mules parading down Main Street.Here, deep religious faith trumps deep pockets, and, with more than 100 churches in town, you see pastors, not plastic surgeons. This town is more catfish than caviar."We're not the beautiful people," says Alton Kelley, executive director of the Middle Tennessee Convention and Visitors Bureau. "There aren't 10 BMWs in town and we like it that way. The bling ends many miles from our borders."DIFFERENT LIFESTYLEThe Mowerys discovered Columbia on vacation and decided to put down roots. Their grown son and daughter wanted to settle there, too, and relocated their young families from South Florida.Hurricanes alone didn't blow these folks north. Tennessee, after all, has tornadoes. Rather, it took a perfect storm of events to make moving day look so good.They cashed in on sky-high priced Florida homes, then bought more for less. Mowery, for instance, paid $190,000 for the land and house. He sold his home in the Acreage, in western Palm Beach County, for $410,000 and moved his trucking business with him.His home insurance: $800 now compared with $3,200. Property taxes: $1,100 compared with $2,500 for a home on 11/4 acres. Nor will he face insurance sticker shock in days to come.But it isn't all about money. The transplants want safer streets, smaller schools and a friendlier atmosphere.
By Liz Doup South Florida Sun-Sentinel Posted June 4 2006
COLUMBIA, Tenn. -- Standing high on a hillside, John Mowery surveys his 91/2 acres, where cattle graze in the backyard and his two-story home is as much sanctuary as shelter."I'm not a religious man but I thank God every morning I'm here and not just dreaming," Mowery says. "I found a piece of heaven."
After 40 years in South Florida, Mowery and wife Lori recently moved to Tennessee, far from crowded streets, heavy development and costly houses.And no hurricanes.As Florida prepares for hurricane season, Mowery, 59, looks forward to a peaceful summer. All because he did what many Floridians only talk about: moving.Two horrific hurricane seasons haven't stopped people from flooding into Florida at the rate of 1,000 a day. But plenty -- 400 a day -- are heading out, to North Carolina, Georgia and points beyond.After the lashing of Hurricane Wilma, the October storm that plunged South Florida into darkness for weeks, a half dozen local families moved near Columbia, about 45 miles south of Nashville."I knew the cycle was getting worse," says Lori Mowery, 49. "I figured we'd end up getting hit good eventually."Moving to rural Tennessee isn't like moving to Atlanta or Charlotte, with their ample shopping, entertainment and a melting pot of people.Going to Columbia means going country. Floridians here want more than a new address. They want a new way of life.In this town of 38,000, tidy red brick homes nestle among rolling hills.Here, adults and children alike say "Yes, sir" and "No ma'am" and wave at strangers. The big annual event is Mule Day, which features 400 mules parading down Main Street.Here, deep religious faith trumps deep pockets, and, with more than 100 churches in town, you see pastors, not plastic surgeons. This town is more catfish than caviar."We're not the beautiful people," says Alton Kelley, executive director of the Middle Tennessee Convention and Visitors Bureau. "There aren't 10 BMWs in town and we like it that way. The bling ends many miles from our borders."DIFFERENT LIFESTYLEThe Mowerys discovered Columbia on vacation and decided to put down roots. Their grown son and daughter wanted to settle there, too, and relocated their young families from South Florida.Hurricanes alone didn't blow these folks north. Tennessee, after all, has tornadoes. Rather, it took a perfect storm of events to make moving day look so good.They cashed in on sky-high priced Florida homes, then bought more for less. Mowery, for instance, paid $190,000 for the land and house. He sold his home in the Acreage, in western Palm Beach County, for $410,000 and moved his trucking business with him.His home insurance: $800 now compared with $3,200. Property taxes: $1,100 compared with $2,500 for a home on 11/4 acres. Nor will he face insurance sticker shock in days to come.But it isn't all about money. The transplants want safer streets, smaller schools and a friendlier atmosphere.
Saturday, June 03, 2006
Investors become 'white knight' in cooling home market
The cooling market for real estate brought Michael Termine and Uso Mbanefo together.Mbanefo, a 43-year-old entrepreneur struggling to launch a clothing-design company, had fallen behind on his mortgage payments. He needed to sell his four-bedroom house here quickly to avoid losing it in a foreclosure. That's when Termine, a 32-year-old novice real-estate investor, stepped in.
One afternoon in early April, Termine visited Mbanefo's office in a strip mall and offered to pay $400,000 for his house. Mbanefo showed Termine fliers for nearby homes offered at $600,000 or more. Termine pointed out that the inventory of unsold homes here, as in many parts of the country, has nearly doubled over the past year. Even so, Mbanefo said that he might be able to refinance his home, spruce it up and sell it for $500,000."I don't see it at 500," said Termine. "I think the magic number to move that house fast is 475." Before leaving, he reiterated his offer. "I have $400,000 waiting for you, in cash."
The slowdown in housing sales, after five years of frantic buying, has ended the party for many real estate investors. But the cooler market is welcome news for a subset of investors — those who target homeowners facing foreclosure.Most foreclosure investors run small, local operations, buying and reselling a handful of properties a year. Some are self-taught; others take courses touted on Web sites or in late-night TV ads. Invariably, they draw criticism from advocates for the poor, who accuse them of preying on the vulnerable."Our time has finally come!" proclaims a recent e-mail advertisement from ForeclosureS.com, a Fair Oaks, Calif.-based company that markets training materials for would-be investors. A 90-minute telephone program promises to teach foreclosure specialists how to be a "white knight" and not "feel like a shark."
Win-win
More people are falling behind on their mortgages, according to the Mortgage Bankers Association. The percentage of loans on which payments are at least 30 days overdue rose to 4.7 percent in the fourth quarter of 2005 from 4.4 percent a year earlier. With interest rates rising, it's harder for homeowners to refinance or sell quickly.
Such conditions are attractive to investors like Termine, who previously has owned a bar, worked in construction and tried acting. "I've always wanted to do the real-estate thing," said the father of two young children. "I just didn't know how."Last year, Termine bought home-study materials from ForeclosureS.com, including six compact discs, for about $400. Then he flew to California in November to take an intensive three-day course. Termine said the lessons taught him to deal honestly and ethically with people facing foreclosure — and make a good return for himself. "If I can create some kind of win-win, then it's worth it," he said.So far, he said, he has used home-equity lines of credit to purchase four homes in foreclosure. He has sold two of them, he said, clearing about $160,000 in profits. Though he expects some transactions to be less lucrative, Termine predicts he can easily earn a six-figure annual income. One sign of his confidence: he bought himself an $82,000 red Porsche Carrera late last year.
Investors find prospects by scanning court filings for notices of defaults on loans. Sometimes, they advertise in poor neighborhoods by tacking up signs on telephone poles. Most ads have a quick-cash pitch, and some hold out the promise of advice for people in distress.A common practice is to find people whose homes are worth much more than the mortgage-loan balance but who have fallen behind on payments. Some investors then persuade the owner to sell the home for a negligible sum above the balance due — with the promise that the former owner can stay on as a tenant and have an option to later repurchase the home.
"Piranhas"
Once the investor acquires the house for a bargain-basement price, some deals go sour. Some investors, for example, evict the former owner if he or she is unable to pay the rent. In other cases, an investor refinances the house, extracts tens of thousands in cash, and then fails to make payments on the new loan.The foreclosure process usually begins when people fall three months behind on their payments. If the borrower fails to catch up or work out a deal with the lender, it can take as little as a few months or as long as a few years before the lender meets various state and local requirements for selling the home at auction.
Lenders often lose money when they foreclose on homes since renovation and marketing costs can be high. And because many homeowners have saddled their properties with debt, houses often are worth less than the amount owed. This lopsided equation makes most lenders eager to work out arrangements with delinquent borrowers, giving them time to catch up on payments.Once an auction is scheduled, though, it may be too late to work out an arrangement with the lender. At that point, the homeowner can be an easy mark for those touting rescue plans.
Advocates for the poor, as well as some politicians, warn that deals with foreclosure specialists are rarely good for strapped homeowners. Elizabeth Renuart, a lawyer at the National Consumer Law Center in Boston and the co-author of a 2005 report on foreclosure scams, said it is "theoretically possible to make a fair deal if the investor makes only a modest profit and the sale returns a reasonable amount of equity to the homeowner." But she believes consumers would be better off trying to work out a deal with their lenders or seeking help from a financial counselor.Illinois Attorney General Lisa Madigan likens some foreclosure investors to "piranhas." She recently has filed three lawsuits against companies she alleges have misled homeowners into selling their houses for paltry sums.One of the best-known buyers of homes from distressed owners is HomeVestors of America Inc., a franchising company based in Dallas.
After paying an upfront fee of $49,000, franchisees receive two weeks of training, and can tap into leads generated by the company's ads. HomeVestors, known for big yellow billboards proclaiming "We Buy Ugly Houses," has 250 franchisees in 31 states and the District of Columbia, up from 43 at the end of 2000.The company says its franchisees typically offer about 65 percent of the estimated market value of homes, minus renovation costs. Such a deal, it says, can benefit people who lack the time or inclination to fix up and sell a home themselves."We never want to look like we're taking advantage of people down on their luck," said John Hayes, the company's chief executive.
ForeclosureS.com, the firm that provided training to Termine, also said that its methods are fair.During a recent $19.99 seminar provided via a telephone conference call, company president Alexis McGee said investors should be honest in describing borrowers' options — including how they might get a higher selling price by listing with a real estate agent. Rather than scare owners about the prospect of losing their homes, she suggested a softer approach: "Hi, my name is Alexis. I understand you are in a difficult situation with your house, and I wondered how I could help."
Termine first contacted Mbanefo early this year after finding court records showing that he faced foreclosure. The two had discussed Mbanefo's options and dickered over the value of his house for weeks before Termine reached a tentative agreement to buy Mbanefo's house, at a price the latter doesn't wish to disclose. At the time, Termine said in an interview that he might make a profit of around $85,000 after paying $20,000 for minor renovations and reselling the house.But the deal fell apart in May when Mbanefo decided to sell to another investor instead. He declines to discuss that transaction.Though the outcome was disappointing to Termine, he presses on. "I can't help everybody," he said. "But I try."
One afternoon in early April, Termine visited Mbanefo's office in a strip mall and offered to pay $400,000 for his house. Mbanefo showed Termine fliers for nearby homes offered at $600,000 or more. Termine pointed out that the inventory of unsold homes here, as in many parts of the country, has nearly doubled over the past year. Even so, Mbanefo said that he might be able to refinance his home, spruce it up and sell it for $500,000."I don't see it at 500," said Termine. "I think the magic number to move that house fast is 475." Before leaving, he reiterated his offer. "I have $400,000 waiting for you, in cash."
The slowdown in housing sales, after five years of frantic buying, has ended the party for many real estate investors. But the cooler market is welcome news for a subset of investors — those who target homeowners facing foreclosure.Most foreclosure investors run small, local operations, buying and reselling a handful of properties a year. Some are self-taught; others take courses touted on Web sites or in late-night TV ads. Invariably, they draw criticism from advocates for the poor, who accuse them of preying on the vulnerable."Our time has finally come!" proclaims a recent e-mail advertisement from ForeclosureS.com, a Fair Oaks, Calif.-based company that markets training materials for would-be investors. A 90-minute telephone program promises to teach foreclosure specialists how to be a "white knight" and not "feel like a shark."
Win-win
More people are falling behind on their mortgages, according to the Mortgage Bankers Association. The percentage of loans on which payments are at least 30 days overdue rose to 4.7 percent in the fourth quarter of 2005 from 4.4 percent a year earlier. With interest rates rising, it's harder for homeowners to refinance or sell quickly.
Such conditions are attractive to investors like Termine, who previously has owned a bar, worked in construction and tried acting. "I've always wanted to do the real-estate thing," said the father of two young children. "I just didn't know how."Last year, Termine bought home-study materials from ForeclosureS.com, including six compact discs, for about $400. Then he flew to California in November to take an intensive three-day course. Termine said the lessons taught him to deal honestly and ethically with people facing foreclosure — and make a good return for himself. "If I can create some kind of win-win, then it's worth it," he said.So far, he said, he has used home-equity lines of credit to purchase four homes in foreclosure. He has sold two of them, he said, clearing about $160,000 in profits. Though he expects some transactions to be less lucrative, Termine predicts he can easily earn a six-figure annual income. One sign of his confidence: he bought himself an $82,000 red Porsche Carrera late last year.
Investors find prospects by scanning court filings for notices of defaults on loans. Sometimes, they advertise in poor neighborhoods by tacking up signs on telephone poles. Most ads have a quick-cash pitch, and some hold out the promise of advice for people in distress.A common practice is to find people whose homes are worth much more than the mortgage-loan balance but who have fallen behind on payments. Some investors then persuade the owner to sell the home for a negligible sum above the balance due — with the promise that the former owner can stay on as a tenant and have an option to later repurchase the home.
"Piranhas"
Once the investor acquires the house for a bargain-basement price, some deals go sour. Some investors, for example, evict the former owner if he or she is unable to pay the rent. In other cases, an investor refinances the house, extracts tens of thousands in cash, and then fails to make payments on the new loan.The foreclosure process usually begins when people fall three months behind on their payments. If the borrower fails to catch up or work out a deal with the lender, it can take as little as a few months or as long as a few years before the lender meets various state and local requirements for selling the home at auction.
Lenders often lose money when they foreclose on homes since renovation and marketing costs can be high. And because many homeowners have saddled their properties with debt, houses often are worth less than the amount owed. This lopsided equation makes most lenders eager to work out arrangements with delinquent borrowers, giving them time to catch up on payments.Once an auction is scheduled, though, it may be too late to work out an arrangement with the lender. At that point, the homeowner can be an easy mark for those touting rescue plans.
Advocates for the poor, as well as some politicians, warn that deals with foreclosure specialists are rarely good for strapped homeowners. Elizabeth Renuart, a lawyer at the National Consumer Law Center in Boston and the co-author of a 2005 report on foreclosure scams, said it is "theoretically possible to make a fair deal if the investor makes only a modest profit and the sale returns a reasonable amount of equity to the homeowner." But she believes consumers would be better off trying to work out a deal with their lenders or seeking help from a financial counselor.Illinois Attorney General Lisa Madigan likens some foreclosure investors to "piranhas." She recently has filed three lawsuits against companies she alleges have misled homeowners into selling their houses for paltry sums.One of the best-known buyers of homes from distressed owners is HomeVestors of America Inc., a franchising company based in Dallas.
After paying an upfront fee of $49,000, franchisees receive two weeks of training, and can tap into leads generated by the company's ads. HomeVestors, known for big yellow billboards proclaiming "We Buy Ugly Houses," has 250 franchisees in 31 states and the District of Columbia, up from 43 at the end of 2000.The company says its franchisees typically offer about 65 percent of the estimated market value of homes, minus renovation costs. Such a deal, it says, can benefit people who lack the time or inclination to fix up and sell a home themselves."We never want to look like we're taking advantage of people down on their luck," said John Hayes, the company's chief executive.
ForeclosureS.com, the firm that provided training to Termine, also said that its methods are fair.During a recent $19.99 seminar provided via a telephone conference call, company president Alexis McGee said investors should be honest in describing borrowers' options — including how they might get a higher selling price by listing with a real estate agent. Rather than scare owners about the prospect of losing their homes, she suggested a softer approach: "Hi, my name is Alexis. I understand you are in a difficult situation with your house, and I wondered how I could help."
Termine first contacted Mbanefo early this year after finding court records showing that he faced foreclosure. The two had discussed Mbanefo's options and dickered over the value of his house for weeks before Termine reached a tentative agreement to buy Mbanefo's house, at a price the latter doesn't wish to disclose. At the time, Termine said in an interview that he might make a profit of around $85,000 after paying $20,000 for minor renovations and reselling the house.But the deal fell apart in May when Mbanefo decided to sell to another investor instead. He declines to discuss that transaction.Though the outcome was disappointing to Termine, he presses on. "I can't help everybody," he said. "But I try."
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