This is the event to be at for all real estate related professionals. Networking with like-minded people eager to expand their business opportunities and prospects. Contact me for any further information.
Responding to lender, condominium association and consumer outcry that the existing FHA condominium lending guidelines are too strict, the Federal Home Administration (FHA) has announced a round of changes which will hopefully make it easier for borrowers to qualify for FHA condo loans. The full FHA announcement can be found here.While some of the changes are a step in the right direction, I think overall they are a mixed bag, as FHA left some of the most onerous provisions intact. I’m skeptical that these new changes will have a major impact on condominium sales, but of course, any loosening of the strict requirements is a positive move.
Condo fee delinquency rule increased to 60 days overdue
FHA is softening its stance on delinquent monthly condo fees and home owner association (HOA) dues. FHA is now allowing up to 15 percent of a project’s units to be 60-days delinquent on condo fees, up from just 30 days delinquent under the prior rule.
Expanded investor purchasing allowed
Under the new rules, investors can come in and buy more units in a project than they could previously. They can now buy up to 50 percent of the project units, up from just 10 percent before, but with an important caveat: the developer must convey at least 50 percent of the units to individual owners or be under contract as owner-occupied.
Owner occupancy limits and total FHA financing percentage unchangedThe biggest disappointment of the new rules is that the main impediment to FHA condo financing remains unchanged, and that’s the 50 percent rule. Before any new buyer can obtain FHA financing, 50 percent of a project’s units be sold to third party buyers. This is what I’ve called the Catch-22. FHA provides the most first time home financing, so how can a developer expect to sell out his project if he cannot offer initial FHA financing? I agree with the National Association of Realtors and the Community Association Institute on this one. Get rid of the 50 percent rule or decrease it to 25 percent or less.Another restriction that hasn’t changed is the number of units that can have an FHA-backed loan. Only half the units can have FHA financing, so a borrower can’t get FHA approval if his unit would put the number of FHA financed units over 50 percent. That limitation remains unchanged, and that’s a killer for a lot of projects.
Spot approvals remain dead
Mortgage lenders used to love FHA “spot approvals” which could by-pass the involved standard FHA approval process in order to get individual unit financing. Problem was is that they love spot approvals way too much, and they got abused. FHA did not resurrect spot approvals from the dead on this go-around. Maybe they will be back when the economy gets better.
More commercial space OK
Projects can also have more space devoted to non-residential commercial uses than before. You see this a now in Boston with Starbucks and a bank office on the ground floor of a new condominium building. Up to this point, only 25 percent of project space could be used for commercial purpose. Now 50 percent of the project can be commercial, although certain authority for approval is reserved for the local FHA office. This will benefit the newer mixed use projects in urban markets.
Fidelity insurance coverage required
Important for all condominium professional management companies. If the condominium engages the services of a management company, the company must obtained its own fidelity coverage meeting the FHA association coverage requirements or the association’s policy must name the management company as an insured, or the association’s policy must include an endorsement stating that management company employees subject to the direction and control of the association are covered by the policy. This is a substantial change to the previous requirements that required management companies to obtain separate fidelity insurance for each condominium.
This is great news and should not be surprising. New construction is exploding all over the country, especially here in Atlanta. Commercial and residential developments continue to pop all over the city, especially high end custom homes.
Builders started on new homes at an annual rate of 750,000 in August, up 29.1% compared to a year ago. If sales keep growing, it may help end the economic doldrums.
By Les Christie @CNNMoney
The U.S. housing industry — crucial to any jobs recovery — showed more signs of strength, according to two reports issued Wednesday.
The Census Bureau said housing starts and permits rose substantially in August. Separately, sales of previously occupied homes climbed 7.8% from a year ago, according to the National Association of Realtors.
Builders started on new homes at an annual rate of 750,000, up 29.1% compared with a year earlier. They applied to build another 803,000 new homes on an annual basis, a 24.5% jump compared with August 2011.
Home builders have become increasingly bullish — a confidence index from the National Association of Home Builders reached its highest level since June 2006.
By Greg Bluestein
The Atlanta Journal-Constitution
Atlanta-based developer Carter has landed a string of major recent projects outside Georgia, and now is setting its sights within the state in hopes of sniffing out some promising deals.
Company president Scott Taylor said the company is hoping to launch a $50 million project for a health-care facility near Piedmont Hospital in 2013 and is considering another $50 million plan to build an office tower atop a parking deck at Lindbergh City Center.
“We’re incredibly hopeful that we can have some development in Atlanta in the near future,” said Taylor.
New development here would represent a homecoming of sorts for the company.
It is is a developing a $50 million project in Columbus, Ohio, a $73 million mixed-use deal in Cincinnati and a $40 million student housing complex in Oxford, Miss. It also plans about $100 million in deals in Louisiana and Oklahoma.
CLICK HERE to read the entire article on AJC.com
The first reaction is always the same: It’s too good to be true.
The disbelief is directed at a next-generation power plant under development in Durham by NET Power. Its backers say their machine won’t emit a particle of pollution.
The emissions-free concept exists only on paper today, but a key mechanical component is getting readied for testing in about four months. It would have to elevate the pressure at which natural gas is burned by a factor of several times, a thermodynamic feat that has only been achieved in the aerospace industry but is limited to computer simulations in power plants.
Increasing sales and falling prices have let to mixed reactions regarding the current housing market. Economists warn that these numbers could artificially inflate good sentiment regarding the market as a whole.
What concerns many is the continued drop in prices, last month, the median price of a new home fell 2.5 percent in July from a year earlier to $224,200. This number may seem small, but considering how important real estate is to the economy, the percentage decrease is significant. Another interesting point is the decrease of available inventory on the market fell 0.7 percent to a record low 142,000 in July. If we continue this pace, it would take almost 5 months to sell all the houses on the market.
What is very encouraging is for the first time since 2005, home building is expected to add to the overall economic growth of the economy. This is significant due to the fact that home builders add many jobs and the acquisition of land and materials helps prop up surround areas affected by further development.
To me, the market continues to strengthen, regardless of falling prices. I see sold sign everywhere and the lack of inventory only continues to light a fire beneath the fence sitters. I recommend to continue promoting your listing to the best of your ability and to market you and your listings. Get it sold, because people are buying.
Willow Tufano is a 14 year old who lives in Florida. One thing that differentiates her from her friends is that she just bought her first house, a rental property. She bought it with her mother, but anted up her fair share with money she saved for over a year by selling free items she had previously found and fixed up.
The area was hard hit by the housing crisis and Willow and her mother were able to buy the home which was once valued at $100,000 for just $12,000. Why would a 14 year old even consider buying a property?
She is using her half of the rent they charge ($700) to pay back her mom for the second half of the house and the renovations they put into the house. Willow says she’ll have it all paid off in six years. Then she’ll keep the house as a source of income.
“It was definitely a lot of inspiration from my mom and my grandma,” Tufano said. Her mom is a successful real estate agent who owns several investment properties.