There was some great news for condo owners announced last week when the US Senate passed the "Housing Opportunity Through Modernization Act," by unanimous consent.
I´m guessing very few people are going to read the small print, but it´s actually a pretty big deal as it eliminates many of the barriers to affordable mortgages for condo owners.
This bill will considerably loosen the existing restrictions on condominium financing. As well as making the FHA's recertification process substantially less burdensome, it also lowers the FHA's current owner-occupancy requirement from 50 percent to 35 percent.
In other words, if you had a condo community with 100 units and only 35 of them were owner occupied, then you couldn´t get finance as an owner. In the near future, you can. In addition to first-time buyers, the bill will help current condo owners who hope to move up to single-family housing by making their current condominium much easier to sell (and therefore more valuable).
More importantly for Torcana clients, these changes will also make it easier for landlords of condos to sell them on the open market to owner occupiers.
Tom Salomone, president of the National Association of Realtors said that "Condominiums often represent an affordable option that's just right for first-time and low-to-moderate income homebuyers. Unfortunately, overly burdensome restrictions on condo financing have for too long put that option out of reach for many creditworthy borrowers. This legislation meets those restrictions head on, putting the dream of homeownership back in reach for more Americans."
The bill has passed the House & Senate and is now on the Presidents desk. Once signed, it becomes law, so stay tuned.
Florida is stronger than ever
The Florida real estate market continues to go from strength to strength. If you had told me in 2010 that average house prices in Florida would rise continually for the next 4.5 years, I´d have said you were being ludicrously optimistic. With median salesprices for single families, condos and townhomes all increasing for 54 months in a row, that is exactly what has happened.
If you want the latest figures: the Florida Realtors Association recently reported higher median prices (up 10.5%), more sales (up 4.5%) and dramatically fewer pre-foreclosure sales (down 37%) compared to this time last year.
This really is a great market, and the turnkey rental homes we are selling to investors with price ranges of $90,000 - $120,000 and estimated NET rental returns of 8-9% are TERRIFIC value.