About That FHA Prepayment Penalty . . .

News that FHA will eliminate a prepayment penalty starting next year has been widely reported. It’s a move NAR has been seeking for some time because it will relieve borrowers of a financial hit that’s entirely out of their control and also bring the agency’s policies in line with other federal agencies that backstop mortgages. Perhaps most importantly, it will align the agency’s policies with the qualified mortgage rule (QRM), which defines what the federal government considers a safe home mortgage loan.

What’s being eliminated is an interest-rate charge. For FHA borrowers that pay off their mortgage before the end of the month, the lender is allowed to charge to the borrower the interest rate costs on the loan from the day the loan is retired until the last day of the month. So, if a borrower paid off the loan on Sept. 10, the penalty would be 20 days of interest payments. That can be hundreds of dollars. Once the change takes effect, on Jan. 21, 2015, lenders will no longer be able to apply that interest charge to the borrower.

NAR continues to work with FHA on other matters. A big point right now is getting some improvement in FHA’s policies on condominium financing. It’s too difficult for many condo projects to get the stamp of approval that’s needed for people who want to buy a unit in the project to get FHA financing.

In any case, you can learn more about what NAR is doing on FHA and in other legislative, regulatory, and legal areas in the latest video in The Voice for Real Estate news series.

The Voice for Real Estate comes out twice a month to provide a quick look at the top national developments in real estate:

Posted in Breaking News, Economics, Law & Policy, Politics & Government, by Robert Freedman on September 11, 2014

Miami Real Estate Market News

Miami Single-Family Home Sales Exceed Record Levels in 2014

by | Aug 22, 2014
Strong demand for Miami properties from both domestic and foreign buyers continues to fuel price growth, as demand for new construction properties continues to gain momentum, according to the 30,000-member MIAMI Association of REALTORS and the local Multiple Listing Service (MLS) system.

Strong Demand for News Construction Impacts Existing Condo Sales

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Miami, FL – Strong demand for Miami properties from both domestic and foreign buyers continues to fuel price growth, as demand for new construction properties continues to gain momentum, according to the 30,000-member MIAMI Association of REALTORS and the local Multiple Listing Service (MLS) system.

Median sale prices again increased for both single-family homes and condominiums in July. Prices remain at affordable 2004 levels despite 37 months of consistent increases for condominiums and 32 months for single-family homes.

The median sale price for single-family homes increased 11.3 percent, up to $255,950 from $230,000 in July 2013. The average sale price for single-family homes increased 19.7 percent from $406,532 in July 2013 to $486,820 last month.

Compared to July 2013, the median sale price for condominiums increased by 5.6 percent to $190,000 from $180,000 a year prior.  The average sale price for condominiums increased 6.9 percent to $345,610 from $323,338 in July 2013.

“Demand for Miami housing continues to strengthen, as evidenced by rising prices and rapid sales activity,” said 2014 Chairman of the Board of the MIAMI Association of REALTORS Liza Mendez. “Condominium resales in Miami are being impacted by all of the new and pre-construction projects now being marketed – and there are actually more sales and contracts when both the new and resale condominiums are added.”

Strong Sales Compared to Record Sales Activity
Single-family home sales in Miami-Dade County increased 0.1 percent relative to July 2013, from 1,227 to 1,229. Compared to June 2013, condominium sales declined 8.8 percent from 1,538 the previous year to 1,403 last month. Combined, residential real estate sales decreased 4.8 percent to 2,632 compared to 2,765 in July of last year.

Miami Real Estate Selling Fast, Close to List Price
Miami real estate continues to sell at a rapid pace and at nearly asking price, reflecting strong demand.

The median number of days on the market for single-family homes sold in June was just 43 days, an increase of 22.9 percent from July 2013. The average percent of original list price received was 95.2 percent, down a negligible 0.9 percent from a year earlier.

The median number of days on the market for condominiums sold in July was 59 days, an increase of 31.1 percent compared to the same period in 2013. The average sales price was 93.5 percent of the asking price, a decrease of 3.7 percent.

“We expect the current momentum of the Miami real estate market to continue as job growth and other economic factors improve,” said 2014 MIAMI Association of REALTORS Residential President Francisco Angulo. “Miami remains a leading global city and destination, and our real estate market plays a major role in this reality.  Miami also remains a focal point for both U.S. and foreign buyers, investors, tourists and business, a fact that will continue to fuel demand for local housing and properties.”

National and State Figures
Nationally, sales of existing single-family homes, townhomes, condominiums, and co-ops increased 2.4 percent from June but were 4.3 percent below what they were in July 2013, according to the National Association of Realtors (NAR).  Statewide closed sales of existing single-family homes totaled 22,099 in July, up 5 percent compared to the year-ago figure, according to Florida Realtors. Statewide sales of condominiums totaled 8,984, down 6.7 percent from July 2013.

The national median existing-home price for all housing types was $222,900 in July, a 4.9 percent increase from July 2013, according to NAR.  The statewide median sale price for single-family existing homes last month was $185,000, up 3.6 percent from the previous year, while that of townhouse-condo properties was $137,500, up 7.4 percent over the previous year.

Cash Sales Decline
Cash sales in Miami continue to decline as more financing becomes available.  Still, access to mortgage loans for condominium buyers remains limited, impeding further market strengthening.

In Miami-Dade County, 54.5 percent of total closed sales in June were all-cash transactions, compared to 60 percent in June 2013. Cash sales in Miami are still significantly higher by 26 percent compared to the national average of 29 percent. All-cash sales accounted for 40 percent of single-family home and 67.1 percent of condominium closings, compared to a year earlier when cash sales were 43.3 percent of single-family home sales and 73.6 percent of condominium sales.

Since nearly 90 percent of foreign buyers in Florida purchase properties all cash, this continues to reflect the much stronger presence of international buyers in the Miami real estate market.

Short Sales Continue to Decrease
While traditional sales continue to increase, distressed property transactions in July again declined in Miami-Dade due to fewer short sales.  In July, only 31.4 percent of all closed residential sales in Miami-Dade County were distressed, including REOs (bank-owned properties) and short sales, compared to 35.1 percent in July 2013.

Short sales and REOs accounted for 8.0 and 23.4 percent, respectively, of total Miami sales in July.  Sales of REOs increased 21 percent while that of short sales declined by 55 percent.

Nationally, distressed homes accounted for 9 percent of July sales compared to 15 percent in July 2013.

Active Inventory Rises
After three years of record sales activity that resulted in an inventory shortage, seller confidence is resulting in more properties being listed for sale in Miami.

Active listings at the end of July increased 26.5 percent, from 13,575 in 2013 to 17,167 last month but remain 60 percent below 2008, when sales bottomed. Inventory of single-family homes increased 20.7 percent from 5,123 in July 2013 to 6,181 last month. Condominium inventory increased 30 percent to 10,986 from 8,452 active listings during the same period in 2013. At the current sales pace, there is still a 5.6-month supply of single-family homes, an increase of 14 percent from 4.9 months in July 2013, and a 7.8-month supply of condominiums, up from 6.0 months in July 2013, an increase of 31.7 percent. A balanced market between buyers and sellers offers between six and nine months supply of inventory.

New listings of single-family homes increased 6.6 percent, up to 2,738 in July 2014 from 1,913 during the same period in 2013. New condominium listings decreased a 3.5 percent from 2,838 in July 2013 to 2,738 last month.

At the end of the July, total housing inventory nationally rose 3.5 percent to 2.37 million existing homes available for sale, which represents a 5.5-month supply at the current sales pace.

New Construction Market Update
Strong sales in the coastal new construction condominium Miami market (east of I-95) reflect significant demand for new properties, according to the latest New Construction Market Status Report released today by Cranespotters.com and MIAMI.

Although existing condominium sales remain consistent compared to record sales activity over the last three years, slight declines in existing sales can be attributed to new construction supply becoming available over the last year.

Further, deposit structures and a high percentage of cash sales in the current new construction market is indicative of a very sound market that is very unlike the condo boom of the last decade.

“The South Florida Preconstruction Condo Market is gaining momentum some three years after this current boom began in 2011. Unlike the last boom that was fueled by loose bank financing, this current condo cycle is being driven by buyers who are putting down hefty deposits of some 50 percent of the presale contract price,” said Peter Zalewski, founder of Cranespotters.com. “Overall, developers in South Florida have already completed 16 new condo towers with nearly 800 units and are currently constructing an additional 70 towers with some 9,300 units. The primary focus for many developers right now is to prepare their projects for the all-important winter tourism season in South Florida that kicks off in November.”

Currently, there are 173 new construction towers that have been announced in Miami-Dade County east of I-95, of which:

  • 53 have not been approved
  • 59 are planned but have not begun development
  • 54 are under construction
  • 7 were completed in 2014

Of the above, 76 projects or 90 towers totaling 14,205 units are currently selling.  To date, 63 percent or 8,883 units have been sold.  The mean price per square foot of these units is $825.

Access July 2014 Miami-Dade Statistical Reports: SFMarketIntel.com

Note:  Statistics in this news release may vary depending on reporting dates. Statistics reported by MIAMI are not impacted by NAR’s rebenchmarking efforts.  MIAMI reports exact statistics directly from its MLS system.

Reportes de Mercado de Bienes Raices ’14 de Miami Beach y Miami

Publicamos con orgullo “The Elliman Report:  Miami Beach / Islas Barrera y Zonas Costeras de Miami”… el principal recurso sobre el estado de estos mercados. En nuestro esfuerzo por brindar el mayor detalle y profundidad de información, recientemente hemos ampliado nuestros informes para que abarquen aun más análisis. Miami se presenta ahora en dos regiones: la Zona Costera de Miami y Miami Beach e Islas Barrera para así reflejar mejor esos mercados. Como siempre, nuestros informes se producen con la colaboración de Miller Samuel a fin de suministrarles a usted y a sus clientes la visión más amplia y neutral del mercado que puedan tener a su alcance.
Los precios de las viviendas en los mercados de Miami Beach/Islas Barrera siguieron en aumento, pasando más inventario al mercado activo después de las bajas récord del año pasado. Los precios de los condominios de lujo se incrementaron más rápidamente que el mercado en general. El tiempo empleado para vender las propiedades cayó al mismo tiempo que la negociabilidad entre los compradores y los vendedores permaneció estable.
Los precios de las viviendas en la Zona Costera de Miami también experimentó tanto una subida en los precios como un aumento de inventario, al aventurarse más vendedores a entrar en el mercado. El mercado se siguió moviendo a un ritmo rápido al mismo tiempo que el tiempo de mercadeo siguió cayendo. La mayoría de las ventas provino de compradores en efectivo, especialmente en el mercado de los condominios.
En Douglas Elliman, buscamos constantemente maneras de brindarles mejor información a nuestros clientes, para que puedan tomar mejores decisiones basadas en información. Nuestros esfuerzos por crear esta serie de informes sobre el mercado refleja nuestra firme opinión que el acceso a información oportuna constituye un recurso vital en un mercado que está cambiando constantemente. Comprometidos como estamos a brindar la mejor información en este sector, nos enorgullece ofrecerles este servicio a nuestros clientes. Explore nuestra serie completa de informes sobre el mercado que abarca Manhattan, Brooklyn, Queens, Long Island, The Hamptons, North Fork, Westchester/Putnam, Miami, Boca Ratón, Fort Lauderdale, Palm Beach así como nuestro informe sobre Los Ángeles que pronto verá la luz en http://www.elliman.com/marketreports.
Con nuestra más cálida consideración,

What is a Property Survey?

A property survey is a sketch or map of a piece of land showing the property boundaries and physical features, like rivers, creeks, and roadways. Some surveys also note topographical information, like elevation and soil density; residential documents typically show the location of houses and other structures, too. In most cases, these maps are treated like official records and can be used to settle property disputes, figure out land value, and determine ownership history, among other things. How surveys are prepared and what exactly they contain can vary from place to place, and much depends on the type of property at issue. The main goals — namely creating a permanent record of land placement and property lines — are more or less consistent across the board, though.

Residential Surveys

Property surveys can be done for residential, commercial, and undeveloped land, and they tend to follow slightly different rules in each category. Residential surveys are usually the most common and come in two basic forms. The first is a “house location” survey, which is also sometimes called a “drive-by” survey, and its goal is to show the location of the house and other large structures on the property, as well as the orientation of those structures in relation to each other.

More detailed surveys, often called cadastral land surveys, typically contain much more information. While house location maps give property owners a sense of what is present and where, a cadastral document usually provides some sense of authority where boundaries, easements, and property lines are concerned. Surveyors typically go to the property and make real-time measurements, which are compared with archived land records to create a more complete picture of what is located where.

Considerations for Commercial Land

Commercial property maps sometimes include the location of buildings and structures, but they are usually focused on zoning boundaries and property use restrictions. “Zoning” is a process used by many local governments to control what sort of activity can happen on a given piece of land. Most zones are drawn using a grid across wide areas; a property survey can give business owners a good idea of where within that grid they sit.

Easements and locally-owned throughways are usually also an important part of these surveys. Many cities and towns require that certain portions of otherwise privately-owned land be kept clear of obstructions in order to allow local officials access to repair and maintain things like public utility lines, sanitary services, and natural gas pipelines. Businesses that violate or obstruct these easements are often subject to fines.

Undeveloped Property

Surveys of vacant land are usually much simpler than either residential or commercial projects, and in most cases, they involve little more than a note of the property’s boundaries and easements. Pre-existing land rights are also important. In many forests, for instance, loggers and naturalists are allowed to freely enter and use the resources; undeveloped beach land often has rights of access attached for local residents. This information is usually noted on land surveys as a way of keeping track of not only where the land is, but also how it is used.

Who Does the Surveying

Landowners can often draw their own surveys fairly accurately by studying land records and looking at official municipal documents, but this sort of “homemade” survey is not likely to be definitive. Most people hire unbiased, third-party land surveyors to draw up more authoritative maps. These individuals sometimes work for independent surveying companies, although they also may be appointed by the courts or other government entities.

Role in Land Transactions

Property surveys are conducted most frequently when land is being sold. Buyers and sellers both usually want a clear picture of where borders and easements are, and setting precise boundaries can also help when it comes to establishing a fair price. Many local laws and ordinances actually require sellers to include official surveys in their sale documents, too. This creates a permanent, official record, and it can also help avoid mistakes or fraud.

Importance to Mortgage Lenders

Mortgage lenders often want a survey before they will loan money to either residential or commercial investors, and many title insurers require this as well. Even if this has been done in the past, lenders typically want something very recent, often dated within six months of the closing date. An up-to-date property survey will reflect any recent changes to the property, like the addition of a fence or driveway; it will also make note of use changes, like the transition from a restaurant to an office building. The report gives everyone involved in a land transfer a clear picture of exactly what is being purchased, as well as an up-to-date sense of the land’s real-time value, taking inflation and current land prices into account.

Dispute Resolution

Detailed maps can also be very useful when it comes to providing an authoritative view on where, exactly, one person’s land stops and the other’s begins. Disputes between neighbors over property boundaries are fairly common. A property survey itself may be enough to settle a more amicable dispute, but for bigger issues, like when one neighbor wants to build something on land the other believes to be his, the matter may have to be decided in court. Judges almost always require an objective property survey in these cases, sometimes actually performed by a court-appointed surveyor. Newer documents are often compared with older surveys on file with the city or county in order to make a ruling about who owns what.

Commercial disputes often use these sorts of documents to determine what can or cannot be done with certain property. A business owner who wants to set up something like a slaughterhouse or a junk yard — both things that would affect other neighboring businesses and their clients — may order a survey to make sure that he or she is within the right zone for the activity, or to clarify whether or not there is enough space. Local laws usually require a certain distance between so-called “nuisance” businesses and neighbors, and a property survey can be a definitive way of seeing if those space requirements are being met.


Particularly when it comes to residential property, renovations are another common reason to get a survey done. People looking to add things like swimming pools or sheds, or who want to extend rooms outwards, must usually first figure out where their property boundary sits. Homeowners who unknowingly encroach on a neighbor’s land often bear the cost of tearing down and relocating renovation projects, which can be very expensive and unpleasant. In most cases, this applies to landscaping projects, too. A person who plants trees or shrubs in what he only thinks is his yard may be unwittingly giving them to his neighbor.

Tax Assessment

Many countries and localities assess property tax based on relative land size and value, and many taxation authorities consult surveys to come up with baseline assessment figures. Property tax is often somewhat complex and depends on the value of both the land and any structures. Surveys aren’t usually entirely definitive in this realm, but they can offer a starting point. They give tax officials a good idea of how big land is, which can help them calculate how much it’s worth; they can also give landowners some sense of how taxes will be assessed and an estimate of what they’re likely to owe.

Source: http://www.wisegeek.org/what-is-a-property-survey.htm