Home Insurance and Backyard Structures

yard_1If you have a freestanding garage, shed, pool or other structure on your home’s property, is it protected under your homeowner’s insurance policy?

Detached Structures
Coverage amount for detached structures varies from policy to policy; check your policy for the specific coverage related to your structures. Keep the rebuilding cost of these structures in mind when purchasing your home insurance policy.

The items inside a shed or garage may also be covered by your homeowners policy, but you might consider a Personal Articles Policy this type of policy protects items beyond the limitations and deductibles of a homeowner’s insurance policy. You should review your personal property coverage with your agent or carrier to verify you have the correct coverage for your personal property.

Swimming Pools
Whether you already have a swimming pool or are thinking about getting one, review liability coverage options with your insurance agent or carrier.

You can also take additional safety measures to help prevent accidents and reduce the potential liability exposure:

Add a high fence with a self-closing, locked gate to keep guests from entering without your knowledge, to help prevent accidents, and reduce potential liability exposure. Enforce safe pool rules, such as not diving into shallow water and walking, not running, around the edge of the pool.

  • Provide non-slip surfaces around your pool to prevent falls.
  • Maintain adult supervision of children in the pool at all times.
  • Keep necessary first-aid equipment near the pool.
  • Contact your local municipality to determine if your pool and surrounding fence meets requirements for size, depth and other safety features.

For more information see the Insurance Information Institute.


For Your Protection Get a Home Inspection


Property Search Orlando Florida

Home inspection gives home buyers more detailed information about the overall condition of the home prior to purchase. In a home inspection, a qualified inspector takes an in-depth, unbiased look at your potential new home to: Evaluate the physical condition: structure, construction, and mechanical systems; Identify items that need to be repaired or replaced; and Estimate the remaining useful life of the major systems, equipment, structure, and finishes.

You must ask for a Home Inspection FHA does not perform a home inspection a home inspection will only occur if you arrange for one. Decide early. You may be able to make your contract contingent on the results of the inspection.

FHA Does Not Guarantee the Value or Condition of your Potential New Home. If you find problems with your new home after closing, FHA cannot give or lend you money for repairs, and FHA cannot buy the home back from you. Ask a qualified home inspector to inspect your potential new home and give you the information you need to make a wise decision.

Appraisals are different from Home Inspections An appraisal is different from a home inspection and does not replace a home inspection. Appraisals estimate the value of the property for lenders. An appraisal is required to ensure the property is marketable. Home inspections evaluate the condition of the home for buyers.

Be an Informed Buyer It is your responsibility to be an informed buyer. You have the right to carefully examine your potential new home with a qualified home inspector. To find a qualified home inspector ask for references from friends, realtors, local licensing authorities and organizations that qualify and test home inspectors.

Inspect your home’s exterior. Check for paint and stucco that’s cracking or peeling. Look for gaps in caulking around doors and windows. Examine foundation for cracks, leaks, or blocked vents.


housing-report-03.2016Orlando’s homebuying season kicks off with a decline in inventory and an increase in median price

The traditional start to Orlando’s homebuying season — April 1 — finds buyers continuing to grapple with a dwindling inventory that in March pushed home prices up 10 percent.
“Like much of the country, Orlando home sales are being impacted by a lack of inventory rather than a lack of buyers,” says ORRA President John Lazenby. “For example, there is only 2.16 months’ worth of non-distressed single-family homes (not short sales or foreclosures) in the critical first-time homebuyer price categories. That’s even below the area’s overall 3.5 months-of-supply, which is far below the six months that economists consider balanced between supply and demand.”

Median Price
The overall median price for the month of March 2016 was $195,000, a jump of 5.41 percent compared to the February 2016 median price of $185,000.

Completed Sales
Homes of all types spent an average of 70 days on the market before coming under contract in March 2016, and the average home sold for 97.14 percent of its listing price. In March 2015 those numbers were 80 days and 96.87 percent, respectively.

The average interest rate paid by Orlando homebuyers in March was 3.70 percent. Last month, the average interest rate was 3.75 while this month last year homebuyers paid an average interest rate of 3.78.

Buyers who earn the reported median income of $57,038 can qualify to purchase one of 4,391 homes in Orange and Seminole counties currently listed in the local multiple listing service for $322,548 or less.

First-time buyers earning the reported median income of $38,786 can qualify to purchase one of the 2,207 homes in Orange and Seminole counties currently listed in the local multiple listing service for $191,963 or less.


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Real Estate Home Buyers News

OD_BloggerWhile the prevailing conclusion is that the economy has not fully recovered from the recession of almost ten years ago, there are certainly some aspects of the economy that have shown signs recovery.

This unfinished recovery is also true in the real estate industry. Home prices are definitely showing signs of recovery, with the average price of homes in many areas of the country now back at levels reached during the peak of the real estate boom. On the other hand, unfinished recovery on the supply side is affecting the numbers of homes available for sale and adding additional upwards pressure to home prices.

Factors of the unfinished recovery directly related to the availability of homes for sale would include; Baby boomers due to losses sustained during the downturn or lack of confidence in the recovery are delaying retirement and scaling down to the condo on the beach and are holding on to their single family home much longer.

Builders are not building new homes at the same pace as before the crash; actuality they are reporting a shortage of skilled labor.

Based on population growth during the past decade the underlying demand for housing may be higher than available supply for several years, providing additional upwards pressure to home prices. To avoid repeating the past, it is essential to address this shortage and the pressing issue that America will need a greater supply of homes to house our growing population in the future.

The Markets

  • Rates on home loans inched higher again in the past week.
  • Freddie Mac announced that, for the week ending March 17, 30-year fixed rates rose to 3.73% from 3.68% the week before.
  • The average for 15-year loans was also moderately higher at 2.99%.
  • The average for five-year adjustable rate loan increased slightly to 2.93%.
  • A year ago, 30-year fixed rates were at 3.78% very close to today’s levels.

Rates indicated do not include fees and points and are provided for evidence of trends only. They should not be used for comparison purposes.


Florida Home Search

Orlando buyers demand for homes outstrips inventory

Orlando median price continues upward trek
as buyer demand for homes outstrips inventory in February

housing-report-02.2016The inventory of Orlando homes available for purchase took another tumble in February, slowing year-over-year sales by 5 percent and driving a double digit increase in median price. Orlando median home price has now experienced year-over-year increases for the past 55 consecutive months; as of February the median price is 60.17 percent higher than it was in July 2011. The median price of single-family homes increased 11.06 percent when compared to February of last year, and the median price of condos increased 3.26 percent.

Sales of duplexes, townhomes, and villas in February jumped 9.91 percent compared to February 2015, yet another sign of limited buyer choice within lower-priced, single-family inventory.

The number of existing homes that were available for purchase in February is 6.55 percent below that of February 2015 and now rests at 10,696

The average interest rate paid by Orlando homebuyers in February was 3.75 percent. Last month, the average interest rate was 3.93. The average interest rate paid by homebuyers one year ago was 3.80 percent.


Buyers who earn the reported median income of $56,981 can qualify to purchase one of 4,471 homes in Orange and Seminole counties currently listed in the local multiple listing service for $320,609 or less. First-time buyers who earn the reported median income of $38,747 can qualify to purchase one of the 2,312 homes in Orange and Seminole counties currently listed in the local multiple listing service for $193,790 or less.

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Tax Times Favors Homeowners

OD_BloggerCongress has consistently enacted tax legislation which favors homeowners. Indeed, much has been written that our tax laws discriminate against renters, by giving unfair and unequal tax benefits to those who own homes. For those of us who own homes, here is a list of the itemized tax deductions available to the average homeowner. Every year, you are permitted to deduct the following expenses:

Real estate property taxes, both state and local, can be deducted. However, it should be noted that real estate taxes are only deductible in the year they are actually paid to the government.

Interest on home loans on a first or second home is fully deductible, subject to the following limitations: acquisition loans up to $1 million, and home equity loans up to $100,000. If you are married, but file separately, these limits are split in half.

Points paid to lower your interest rate are deductible. Points paid to a lender when you refinance your current home loan are not fully deductible in the year they are paid; you have to allocate the amount over the life of the loan.


Source: Realty Times

Be sure to consult your tax advisor regarding taking advantage of all of your house-related deductions.

Housing Tax Benefits Extended

OD_BloggerHomeowners are among those who will benefit from a $760 billion tax deal that was signed into law in December. The deal includes two very important tax breaks for those who own homes. The law contains a retroactive extension of The Mortgage Debt Forgiveness Act through 2016. This law expired at the end of 2014 and, without the extension; any loan forgiveness achieved in a short sale would have been counted as income for homeowners who sold their homes for less than the amount of their home loan during 2015.

Also extended retroactively until 2016, was the deduction for mortgage insurance payments which expired at the end of 2014. Borrowers with adjusted gross incomes up to $100,000 can deduct 100% of their payments. Deductions are reduced by 10% for each additional $1,000 of adjusted gross income above $100,000. The threshold for married borrowers filing separately is $50,000 of adjusted gross income per person. Deductions are reduced by 5% for each additional $500 of adjusted gross income above $50,000. If you have questions regarding your eligibility for these tax breaks, it is suggested you contact your accountant. 


Low Mortgage Rates In 2016?

OD_BloggerReceived the following important information about interest rates in my newsletter this morning, had to share.

The Fed Meeting Finally Arrives

The Federal Reserve Board’s Federal Open Market Committee meets today and tomorrow. This is the most anticipated meeting of the Fed in almost a decade. It has been exactly seven years since the Fed moved short-term interest rates to close to zero and it has been over nine years since the Fed actually raised short term rates. Now the markets are expecting the Fed to raise rates from these historically low levels once again.

The Federal Reserve has indicated all along that the markets would get plenty of notice before they raise rates. This notice is designed to prevent market shocks. One must remember that the Fed is only raising short-term rates. For example, the Federal Funds Rate is the rate banks charge each other overnight as they balance their holdings. The other rate controlled by the Fed is the Discount Rate, which is also a short term rate charged to banks for borrowing money. The question is–how can these rates affect long-term rates that consumers pay for loans on cars, homes, credit cards and even student loans?

Some rates such as credit cards which are pegged to the prime rates charged by banks may go up instantly. Other loans which are based upon longer term rates such as home loans are not as easy to predict. That is where the markets come in. The markets react to what the Fed may do before they take action. For example, rates on home loans have risen in anticipation of the Fed’s move. Now the markets will listen to what the Fed will say about potential future interest moves. So let’s see what the Fed has to say in addition to whether they raise rates.




The Cost Of Waiting

Failing to refinance a home loan when interest rates fall can be a very costly mistake—tens of thousands of dollars in savings can be lost over the life of the loan. Yet about 20% of U.S. homeowners had fallen into this trap, according to a paper published this summer by the National Bureau of Economic Research.

The median total of lost savings for those who didn’t refinance was about $11,500 in present-value terms, the paper said (meaning actual losses over the life of the loan would amount to more than that). The Wall Street Journal spoke with Devin G. Pope, an associate professor at the University of Chicago Booth School of Business, one of the study’s three authors, about how to get more people to refinance their homes when interest rates fall.

Here is what Pope indicated — There can be real value in transferring money to homeowners as a way to stop the spiraling effect of foreclosures. Also, having people refinance their homes is a great way to put money in their pockets and stimulate the economy.

Yet if people are not refinancing, then it’s not completely working as a stimulus.” Pope continued: “We find some evidence that people with lower education and incomes are more likely to be in the group that is failing to refinance, which could indicate that financial savvy comes into play. There was also some evidence of procrastination.”

Source: The Wall Street Journal 

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Controversial Rate Checker Tool Tweaked

OD_BloggerUnder strong criticism from the Mortgage Bankers Association and other industry trade groups, the Consumer Financial Protection Bureau made tweaks to its controversial Rate Checker consumer tool.

But MBA President and CEO David Stevens said the tweaks do nothing to resolve “fundamental flaws” with the tool and continue to provide “misleading” information to consumers. 

On January 13, the CFPB unveiled this new borrower education tool on its website (Click Here for Rate Checker) ostensibly to help consumers be better informed of rates and other costs when shopping for a home loan. CFPB said this Rate Checker tool will allow consumers to “see what interest rates people with similar financial situations have been offered.”

The tool uses a credit score, state; property location and a down payment percentage to generate an estimate for a borrower of rates available.

The website which indicates rate information for the rate checker is provided by a private firm who collect data from “actual lenders and is updated every business day.” “When the imprimatur of the government is associated with particular data, the public assumes the data are complete and accurate. However, the lenders’ rates incorporated in the tool include only a mix of large banks, regional banks and credit unions. Notably, rates from independent mortgage banks do not appear to be included in the data. Similarly, discount points, origination fees and mortgage insurance are not included, yet are a significant part of the cost of residential finance–and are critical for any website that purports to be a comprehensive borrower decision tool.” 

Source: Mortgage Bankers Association