Posts

Ocala Florida home buying advice……..heat pumps

/in , , , , ,

Most Ocala area homes are cooled and heated by a heat pump. Although a heat pump looks like central AC unlike an air conditioner it heats as well as cools. You can only get away using a heat pump in very mild climates like here in Ocala where we get very few winter nights below freezing. The winter here in Ocala is really only about 6 to 8 weeks long.

There is natural gas for heating in some areas. Generally it doesn’t pay to lay gas pipes in areas without high heating costs. You do find gas in some areas of the city of Ocala and in a few retirement communities where there are a lot of homes closer together. People who are looking for gas are usually looking for cooking rather than heating. Some people use propane for cooking but it is expensive.

Heating is not the issue or expense here in Ocala. The expense is air conditioning which is also supplied by the heat pump. You will need AC from late May until late October 24/7. From Late October until around Christmas and from mid March until May you might not need heat or AC.

Someone said to me just recently that energy efficiency isn’t as important in Florida as it is up north. The rational was that even if the outside temps are in the 90’s you will only be trying to cool the inside down to the high 70’s. A difference of less than 20 degrees as opposed to trying to heat a house to 70 when the outside temps are in the 20’s a difference of 50 degrees. His point being that expensive windows and insulation doesn’t have the pay back it does in more extreme climates.

 

 

No one has been building since 2007

/in , ,

Buyers often come to me looking for a newer home here in Ocala. I often tell them that no one has been building homes here since the market crash in 2007. Of course it isn’t true that no one has built anything since 07 but there has been very little building. Builders simply can’t compete with the prices of resales.

Here are permits for single family homes by the year to illustrate my point.

2004  4,611

2005  5,601

2006  6,026

2007  2,139

2008    933

2009    316

2010    399

2011    325

2012    359

 

Five things not to do when buying a house

/in

Here are 5 things to avoid doing when you’re either getting ready to buy a house or already in the process. Doing any of these things will cause huge issues with your lender over financing.

1. Do not change jobs

2. Do not switch banks or move money from one account to another

3. Do not pay off existing loans unless your lender requests it.

4. Do not make any large purchases like a car or furniture

5. Do not change your marital status

These are all red flags to a lender and you will have to provide extensive documentation justifying any such action.

 

Home Inspections

/in , , ,

The purpose of a home inspection is to find a problem so large and costly the buyer might not want to buy the house. Or in some cases so many problems that add up to so much money that the buyer might want to back out of the deal. Home inspections aren’t intended to create a laundry list of repairs to make a home like new again.

One problem I encounter is that home inspectors as a courtesy provide maintenance suggestions in addition to needed repairs. The difference in repairs and cosmetic items is defined in the Florida real estate sales contracts but that doesn’t seem to help with the confusion.

The way that repairs are defined in the Florida RE contract can cause problems. For example a 20 years old roof that doesn’t leak but is at the absolute end of it’s life doesn’t need to be replaced. The same with termites. A seller can make repairs up to 1 1/2% of the purchase price. You might just want to walk away but the contract locks you in.

In certain circumstances like the above examples it’s better to use an AS IS contract that let’s you out of the deal for any reason regarding the inspection or you can use a right to inspect right to cancel addendum.

Escrow Deposits how much is enough

/in , ,

When you write an offer on a house you’re expected to make a good faith deposit. That deposit is held in escrow by the title company and can be contingent on things like financing or a home inspection. I usually tell me buyers around $1,000.00 and it’s surprising how many sellers will accept that amount. However from a sellers point of view you have to ask yourself if you wanted to get out of a contract would you walk away from $1,000.00? A lot of people might if they had a good enough reason. But would you walk away from $5,000.00? Probably not. $10,000.00? Pretty much definitely not. A lot of my buyers are also sellers somewhere else. You have to look at things from both points of view depending on which side you are on at the time.

How to make a low offer on an Ocala area home

/in , ,

If you want to make a low offer on a home here in Ocala you have to give the seller a good reason to accept your offer. Here are a few things that make for a “strong offer”.

1. Cash. Cash means no finance contingency. The seller can be confident that their sale won’t blow up at the last minute because the loan gets rejected by the banks under writing department. Happens more often than you might think. Not all loan pre approvals are created equal.

2. AS IS. A contract that gives the buyer the right to inspect the home and walk away if the inspection is not satisfactory. The seller makes no repairs and knows exactly what they will net from the sale. Attractive to out of area sellers who would have a hard time getting repairs accomplished.

3. Fast Closing. A cash offer can close very fast, 7-14 days. The seller may not like the offer but is tempted by the fact that the deal will close fast and they can move on saving money in taxes, utilities, insurance, mortgage ect.

If you think that making an offer using a loan with little or no down payment, asking for closing costs or expecting the seller to throw in their furniture or a golf cart is the way to get a deal on a house then you’ve been watching way to many real estate shows on cable TV.


How to establish fair market value

/in , , , , , ,

I spend about 95% of my time as a buyers agent here in Ocala. One question that comes up is “what should I offer?”. I suggest that a buyer look at comparable sales to come up with an offer. A good comparable would meet the following criteria.

same sub division

sold in the last 90 days

within 1 mile of subject property

+/- 10% of the sq ft of living area

same # of beds, baths and size garage

+/- 5 years in age, 10 years if home is over 10 years old

same construction type

All this above can be used by a buyer to come up with an offer on a home or it can be used by a seller to find a proper list price. In the end it doesn’t matter what a buyer or seller thinks a house is worth. What matters is the price that similar homes have sold for in the past 90 days. Sellers should keep in mind that in order for a buyer to get a loan a bank will send out an appraiser who will use very similar criteria for an appraisal.

Ocala real estate a once in a life time opportunity

/in , ,

Right now is the opportunity of a lifetime to buy an Ocala home. Here are 12 reasons to invest in Ocala real estate right now.

1. Interest rates are at historical low with no where to go but up.
2. Many Ocala area home sellers will pay part or all of a buyers closing costs.
3. Fannie Mae Homepath Financing doesn’t require an appraisal and also offers renovation loans for their Ocala and Marion County foreclosed properties.
4. USDA offers 100% financing with no Private Mortgage Insurance (PMI) on many Marion County homes. Mostly homes that are not in the Ocala city limits.
5. FHA loans allow the seller to pay many of the buyers closing costs.
6. Conventional loans rates are at all time lows. Local banks want to loan money to buyers with good credit. Don’t let anyone tell you different.
7. Foreclosures are selling at a 50% discount from 2005-08 highs.
8. Most Ocala foreclosures are in good condition and easily pass a professional home inspection.
9. Many “traditional sellers” have dropped their prices to better compete with distress sales.
10. In the 55+ communities there are always great deals on estate sales.
11. Estate sales also exist outside the 55+ communities and are a hidden secret often over shadowed by Ocala area foreclosures and short sales.
12. Principle, interest, taxes and insurance are often not much more than renting.

If you are a first time buyer, a renter, a retiree or investor now is the time to buy.

It’s termite swarm season here in Ocala

/in , , ,

Its termite swarm season again here in Ocala. As the weather warms up termites go out and look for a new home. You do not want that new home to be yours.

Termites cause $700,000,000.00 in damage each year here in Florida. Despite this scary statistic about half the homes in Florida have no form of protection.

There are 2 types of termites, subterranean and dry wood. The subterranean variety is considered the worst because they have much larger colonies and thus eat more wood. Obvious from the name they live in the ground and prefer moist conditions and wood. The subterranean termites enter your house through a sort of tube that connects their colony to the food source. Dry wood termites like dry wood, like the rafters in your attic. They have much smaller colonies and are harder to detect.

The University of Florida has a great web site dedicated to termites with loads of information and great color images. Take a good look at the pictures and so you can identify the little buggers if you see one.

 

There are several warning signs of a termite problem.

1. Little black winged insects about 1/4″ long that are attracted to lights at night.

2. Wings on your window sills and in spider webs.

3. Wood pellets, smaller than a grain of rice that is 6 sided when viewed under a magnifying glass. Yes, these are termite droppings.

4. Mud tubes look like mud caked to the side of a house and are actually engineered by industrious termites to create access to your house and their food supply.

There are several things you can easily do to avoid termite problems.

1. Have a termite inspection.

2. Keep fire wood piles well away from the house.

3. Water is your enemy and a termite’s friend. Check that gutters and down spouts drain away from the house. The same goes for air conditioners.

Termite control is not a do it yourself project. Homeowners should get an annual inspection by a professional. It is essential to have a termite inspection before buying any house in Florida. Although a concrete block house may be preferred, it is no guarantee that you won’t get termites.

Due Diligence in Ocala Real Estate

/in ,

The buyer has a responsibility to do their own research and due diligence when buying a home. A real estate agent in Florida is assumed to be acting as a transaction broker with the following limited responsibilities.

1. Deal honestly and fairly.

2. Account for all funds.

3. Use skill, care and diligence in the transaction.

4. Disclose all known facts that materially effect the property even if not readily observable to the buyer.

5. Present all offers and counter offers in a timely manner.

6. Limited confidentiality. An agent can’t reveal that a seller will take a lower price, a buyer will pay a higher price or other info detrimental to the oposing party. The buyer or seller are not responsible  for the actions of their agent unlike a single agency.

This is a brief over view of the duties and the full disclosure is available in PDF format if you want a copy.

When you work with an agent you are really working with their broker. Acting as a transaction broker allow the agent to show other listings from their brokers office.

The point of all this is that it is up to the buyers to determine if the home and the area is suitable for them.

Here are a few resources.

Read the local newspaper, the Star Banner, it’s online and free. Read it every day to get a feel for the area, schools, politics or what ever interests you.

Don’t ask a Realtor questions about an areas demographics. That’s the third rail of real estate. If you’re interested in demographics do an internet search. You can search on anything even by zip codes.

Law enforcement agencies have pretty nice web sites. The 2 important ones are the Marion County Sheriff and the city of Ocala police department. Remember although our area is often referred to as Ocala a lot of the area is actually in Marion County and may be in a subdivision that is not in any city or town.

Ocala is a great place to retire or to live if you’re self employed but finding a job can be tough. I think the best resource for Ocala employment opportunities is Employ Florida.

Google Maps is a nice way to get a feel for Marion County. I’ve created a map of Ocala 55+ retirement communities and plan to build others. If you’re not real familiar with Google Maps or the competition, you can often click on areal view and zoom in on a feature or area. Keep in mind that these images may not be up to date.

Property taxes are very confusing. The tax amount that you see on a listing is probably not what you will end up paying. Taxes are reassessed every time a house is sold. The Marion County Property Appraiser has a nice web site. Check out the FAQ and the tax estimator. I have also added a new page to my web site about Ocala area Property Taxes.

Read my blog. I try to do 1 or 2 posts a week. I also blog about the weather and market conditions monthly.