Homes for Sale in St. Augustine: I Paid CASH, Can the HOA Foreclose on My Home?

September 3rd, 2010

by Sean Hess (www.SeanHess.com), Broker and Manager for St. Augustine Team Realty (www.StAugustineTeamRealty.com).   Join us on Facebook.

So you bought a house, paid cash (no mortgage), but you decided that you didn’t need to bother with those Homeowner’s Association Dues.  Bad move on not paying the HOA dues. 

In Florida an HOA can foreclose if you don’t pay the dues.

Ditching HOA dues is like ditching a speeding ticket: sooner or later it catches up with you, it will cost more to settle than if you would have just paid it, and it will possibly involve attorneys. 

Basically, if you are behind on your dues the HOA can file a lien on your property forcing you to pay the dues before you can sell.  But if they don’t want to wait for you to sell they can ask the court to foreclose and use the proceeds from the sale to pay the dues.

So if you have issues with the association try to work with them, and be a part of the association, before it gets that far.

I’ll give you an example.

My friend bought a house in a new development in 2005.  In 2009 the developer turned management of the association to the homeowners.  Now, in this community about 25% of residents keep their lawns golf course manicured perfect, the other 75% keep their lawns up, but don’t otherwise irrigate or fertilize.

This summer has been the hottest in Florida in over 50 years, the fourth hottest on record and in our part of the state we had something like a record 45 days in a row above 90 degrees.  Even if you irrigate regularly this has been a hard summer on grass, with burnt patches and thin growth. 

So in my friend’s development the HOA sent out a letter to about 3/4 of the folks demanding that they get rid of the burnt patches, edge, weed…all this goofy stuff.  For my friend to comply to these standards he would not only have to hire a landscaper, but he would have to install a irrigation system.  Furthermore, to meet these standards from the HOA he would have to irrigate everyday, which would be illegal (you’re only allowed to irrigate two days a week here due to water conservation rules).

So he is going to be friendly, but firm, with the HOA and work with them.  He’s going to site all the points above.  He will continue to take care of his lawn.  But he will not reach for an artificial standard that would force him to bear undue cost or violate the law by watering illegally.  And if the HOA doesn’t back down he can then move towards legal action, should he choose.

Better the homeowner initiating the lawsuit than the homeowner’s association.

This post was inspired by an answer posted in a Truli online Q&A forum by New Smyrna Beach Realtor Donna Concannon of Prestige Properties.  And thanks to my dear friend Jake for the HOA example.      

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Posted in HOA dues, HOA foreclosure, HOA lien, St. Augustine Real Estate, buying in st. augustine, moving to st. augustine | No Comments »

Homes for Sale in St. Augustine: I’m Buying a New Home, I Don’t NEED an Inspection!

September 1st, 2010

by Sean Hess (www.SeanHess.com), Broker and Manager for St. Augustine Team Realty (www.StAugustineTeamRealty.com).   Join us on Facebook.

Buying new?  Don’t think you need a home inspection?

What are you crazy?

Look a home is a home.  The only difference between a new home and a re-sale home is the age of the materials. 

You would inspect a 5-year old home wouldn’t you?  Would it matter if the home was new or 5-years old if a subcontractor forgot to blow the insulation in?

Using a home inspector on a new home helps you in two ways.  The first is it helps you create a punchlist for items that aren’t done yet, so that the builder can fix these items before you move in and before you close.  The second thing is that it will find items that simply were not done: electrical outlets that weren’t connected, insulation that wasn’t blown in, a toilet that was broken during installation and is leaking.

So get a home inspection and get some peice of mind. 

This blog post was inspired by a similar blog post from Realtor Carla Muss-Jacobs in Portland (Beaverton), Oregon.

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Posted in St. Augustine Real Estate, buying in st. augustine, home inspectors, moving to st. augustine, new construction | 2 Comments »

Florida Realtor Convention Recap: Goofballs and Know-it-All Realtors

August 30th, 2010

by Sean Hess (www.SeanHess.com), Broker and Manager for St. Augustine Team Realty (www.StAugustineTeamRealty.com).   Join us on Facebook.

Goofballs. Card Slappers. Know-It-Alls in Pink Oxfords. Angry dudes in Bowling Shirts.  Just another Florida Realtors convention. 

On my personal Broker site this morning I did a post on the Goofballs and Know-It-Alls I  met at the FR convention.  I hope you enjoy the post!

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Posted in St. Augustine Real Estate, florida realtor convention 2010 | No Comments »

Homes for Sale in St. Augustine: Are You a Gullible Buyer?

August 25th, 2010

by Sean Hess (www.SeanHess.com), Broker and Manager for St. Augustine Team Realty (www.StAugustineTeamRealty.com).   Follow us on Facebook.

Are you a gullible buyer? 

I was doing some market research for a friend this morning and was trying to figure out why, in a subdivision where everything was selling at $250,000, one buyer ponied up $330,000 for essentially the same home. 

I will never know the answer to the question above, but here are two pointers to avoid getting trapped into buying less home for more money:

  1. Look at Several Similar Homes before you Buy. Yeah, I know, you did all your research on the internet and “you know St. Augustine.”  Here’s a tip, ask the Realtor for ALL the ACTIVE LISTNGS in a community, once you decide which community you like.  If you call a Realtor and look at just one property and then write an offer, you’re potentially leaving money on the table.  I suspect that’s what happened up above…in a single penstroke someone lost $80,000 in equity because they didn’t look around, and its their own darn fault.
  2. Use an Area Realtor. I know that when I list my properties in out of area MLS systems (and other Realtors don’t), it gives me a competitive advantage because sooner or later an out of area Realtor will bring in a buyer.  The buyer and the Realtor won’t know that there are actually 20 properties available in a subdivision because they can only “see” five in their local MLS.  So every year I make at least one sale just from this.  To avoid this pitfall just ask the Realtor if they are a member of the local board for the city you are looking in…St. Augustine Realtors aren’t necessarily members of the Jacksonville board (that also serves Ponte Vedra), and Jacksonville Realtors are rarely members of the St. Augustine Board.  You may be missing a bunch of available homes for sale if you don’t ask.   Some areas are true “border areas” where half the listings will be in St. Augustine, half in Jacksonville (County Road 210, for example), so ask if the Realtor is a member of both boards.  

Posted in St. Augustine Homes for sale, St. Augustine Real Estate, buying in st. augustine, gullible buyer, moving to st. augustine | 2 Comments »

Homes for Sale in St. Augustine: How FAST Can I Buy a Home?

August 23rd, 2010

 

by Sean Hess (www.SeanHess.com), Broker and Manager for St. Augustine Team Realty (www.StAugustineTeamRealty.com).   Follow us on Facebook.

How do you buy a home fast?

Good question.  If you’re paying cash it can be done in a week or under.  It just depends on how comfortable the title company is preparing the title insurance…they might need a few days to do lien research just to make sure title to the property is sound.  If the property your buying has a mortgage on it, it might also take a few days to get official word from the bank on what the payoff is. 

If you need a loan to buy then “fast” might mean “45 days.”  We’ve had some close in 30 days this year but they’re the exception.  Today is August 23…if you wanted to close by October 1 it’s do-able but a lot of things need to go right.  Here’s what needs to happen:

  • You’re going to need a good Realtor and lender right off the bat.  If you’re reading this and need to close by October 1, give me a call at (904) 386-8327, I know some good people.
  • The lender is the first step in that we need to know what you can spend.  You’ll need pay stubs, the last two years tax returns, the last two or three months bank statements, etc., so start gathering those up.  There may be a nominal application fee that just covers checking your credit, or if you’re really comfortable with the lender it will be a few hundred dollars, which includes the future cost of an appraisal. 
  • You may be in the enviable position of being able to afford more than you’re comfortable with.  If you have a monthly payment in mind, tell the lender and stick to your guns.  See what that monthly payment will buy before you decide to up it, which leads us to…
  • If your credit score is bad, you’ll need a higher down payment (10% on a FHA loan), possibly more on a conventional loan.  If you’re buying a condo you might need to put 20% or more down regardless of credit.  For a home in otherwise good condition (not a fixer upper) you can a down payment as low as 3.5% with FHA. 
  • I as a Realtor will help you identify properties right away.  As soon as you decide on one I’ll help you make an offer on it…I could write an entire blog post on making an offer…let’s just hope the negotiations go quickly and to your advantage.  You will put down an earnest money deposit (”binder”) of a few thousand dollars to be held in escrow until closing. 
  • You will not be looking at short sales, because these properties take 90-120 days just to get a “yes” or “no” answer on.
  • We get the signed offer to the bank so they know what they are lending on.  The bank will schedule an appraisal and they will check your income, job status, etc., right up to the day of closing…so don’t spend your down payment or buy a car.  There will be more paperwork and hoops to jumps through as the process winds its way to conclusion…lots of new laws this year designed to keep the process slow and steady and hopefully prevent another housing collapse like we saw in 2006-2008.
  • We do inspections so you go into ownership with your eyes wide open about the home you are buying.  Find something unexpected or just get cold feet?  You should be able to back out as long as you do it by the deadline specified in the contract.
  • A two or three week wait as the bank does its underwriting, slowly.
  • The inspection works out, the appraisal comes in, the sellers want to sell, and you show up at closing with your down payment (the binder should already be there), the paperwork and money from the lender shows up, and you have just bought yourself a house. Congratulations!

I borrowed some of this from Chicago Broker David Hanna’s answer to an online query at Trulia.com.

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Posted in St. Augustine Homes for sale, St. Augustine Real Estate, buying fast, buying in st. augustine, moving to st. augustine | 1 Comment »

Homes for Sale in St. Augustine: How do I buy a Foreclosed/Bank Owned Home?

August 18th, 2010

by Sean Hess (www.SeanHess.com), Broker and Manager for St. Augustine Team Realty (www.StAugustineTeamRealty.com).   Follow us on Facebook.

How do I buy a foreclosed (bank owned, REO) home? 

It’s pretty simple, really: you find a Realtor and make an offer.

Here are the differences with most other homes:

  • There’s going to be a lot of bank specific paperwork that will need to be submitted with your offer.  This paperwork is very general, and as it’s written it will cover laws in states that you are not living in.  It’s a very good idea spend a few hundred $$$ to have an attorney look it over.  That doesn’t mean you’ll be able to strike things from the contract, but at least an attorney can give you an idea what you are signing.  If the closing is being handled by an attorney’s office, your attorney may be able to talk with the other attorney and strike some things that don’t apply or aren’t in your best interest.

 

  • Typically the closings are handled by attorneys/title companies that are out of area, so you won’t attend a traditional closing.  It will either be done by mail, or you may go to a local title company to sign the documents as a “courtesy closing” location.  The courtesy closing location will not have anything to do with your closing per se, except to provide you a notary and some direction.  This is another good reason to hire an attorney.

Other than that it’s pretty straight forward.  Unlike short sales, the answer (in my experience) on your offer for a bank owned/reo will come back in a matter of days.  But like a short sale you must submit your prequalification and/or proof of funds (for a cash sale) with your offer.  Your offer will not be considered if it does not come with these items. 

The first time you look at a house the utilities will not be on.  If you make an offer and it is accepted they’ll turn the utilities on for a day for you to do your inspections.   

Most Realtors that handle bank owned/reo properties don’t show their own listings…their workload is too heavy….but any other Realtor should be able to show you the property provided you’re qualified.   

We got the idea for this post for a similar question posed on an online forum and answered by Jacksonville Realtor Jason Lindsay.

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Posted in St. Augustine Homes for sale, St. Augustine Real Estate, buying a bank owned home, buying a foreclosure, buying an reo, buying in st. augustine | 1 Comment »

St. Augustine Homes for Sale: Do I Need to Know the Taxes if I Buy a Short Sale?

August 16th, 2010

by Sean Hess (www.SeanHess.com), Broker and Manager for St. Augustine Team Realty (www.StAugustineTeamRealty.com).   Follow us on Facebook.

Do I need to know the taxes if I buy a short sale?

The short answer: no.  At least not in Florida.

Taxes in Florida are keyed off sales price and then based on millage.  In St. Johns County, if you want a very rough and tumble way to estimate your taxes, take the sales price, multiply it by 92%, take off $50,000 (if it will be your homestead property), and multiply that by 1.8%.  That will give you a very rough estimate of taxes.  If the home is in a Community Development District (CDD) then you will have to tack that amount on as well, and each CDD has a different amount.

When you buy a short sale any taxes in arrears have to be brought up to date at closing.  Let me say it another way, before any title company will give you title insurance (insurance that says the title is free and clear of any liens) and a warranty deed, the taxes have to be paid, other liens have to be paid off (including past-due HOA dues), as well as contractor liens, etc. 

The new taxes are your own, and based on the purchase price you paid, millage, and homestead.

This post was keyed off a response to an online discussion on whether it was a good idea to buy a short sale, and an answer by Orlando Realtor Avi Maganda.

Posted in St. Augustine Real Estate, buying in st. augustine, moving to st. augustine, short sales, taxes on short sales | 3 Comments »

St. Augustine Homes for Sale: What do Realtors do to Market a House Beyond the MLS?

August 13th, 2010

by Sean Hess (www.SeanHess.com), Broker and Manager for St. Augustine Team Realty (www.StAugustineTeamRealty.com).   Follow us on Facebook.

What do Realtors do to “market” a house beyond putting it on the MLS…

I found this question while trolling the real estate blogs this morning.  It’s a good question.

I can’t speak for other Realtors, but I can speak for us.  To dumb it down a bit there are four different ways to market a home for sale: networking, print advertising, online advertising, and “other.”

Networking is the most important of the four, and I would include MLS (multiple listing service) in this group. 

Buyers use Realtors to buy homes.  Realtors use the MLS to find those homes.  So when I create a listing in MLS, great care is used in speaking to the Realtor as well as the Buyer.  It affects the headlines I use, the copy, and even the sequence of photos.  Since the Realtors often create the final short list they give to their customers, we pay a lot of attention to their needs. 

The other side of networking is the face-to-face part, and it is just as important.  Certain agents work with certain buyers or certain types of properties.  We make sure they know us and know our properties, so they feel comfortable coming to us with offers and questions.  Most importantly, when we get one of “their type” properties we put a bug in their ear and make sure they know it’s out there.

Print advertising is the thing we wish would all go away…it’s expensive and ineffective for selling homes.  So why do we and other companies plunk down hundreds if not thousands on print?  Because it is effective for attracting sellers and agents.   Sellers live in a market day to day, get the paper every day, and they see so and so advertises.  Must be successful, right?  Possibly.  Companies, ours included, use print to tell other agents, “hey, we’re in business and spending money, come work for us.”  But for the most part it won’t sell your home.

Online advertising is how we find the buyers, so it’s the thing we pay the most attention to (equally with networking).   While we feed our listings to something like 73 different sites, it’s how we do it that’s important.  We structure a lot of these feeds differently, and these are structured strictly for the buyer, to catch their attention, so hopefully they will contact us about buying your home.  We don’t post listings willy-nilly, but are very calculated in how we do it: we want our online advertising to make sense to the buyer so they find what they’re looking for fast and without a hassle.  We use things like social media and blogs as well to accomplish this.

“Other” is more the institutional advertising we do with logo decals, race sponsorships, bike team sponsorships, television, radio, etc.  We’re hoping to catch a customer’s eye or ear.  It’s an indirect way to get the properties we list sold by attracting customers to our firm.  If they have a list of wants and needs we’ll help them find it, and we’ll make sure they see our listings that meet those needs as well.  One of those could be your home.

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Posted in St. Augustine Homes for sale, St. Augustine Real Estate, marketing besides MLS, marketing plan, realtor marketing | 3 Comments »

Are You a St. Augustine Tourist + Moron = Touron. Find out Here.

August 11th, 2010

by Sean Hess (www.SeanHess.com), Broker and Manager for St. Augustine Team Realty (www.StAugustineTeamRealty.com).   Follow us on Facebook.

We love our tourists in St. Augustine.  We are grateful for their business and that they decide to spend their money and their time here.

Unfortunately, some of those who come to visit are called “Tourons” by those of us who live here.  That’s Tourist + Moron = Touron for those of you not in the know.  Are you a Touron?  Find out on this post I did for my personal site.

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Posted in St. Augustine Real Estate, tourist moron, touron | No Comments »

First Time Home Buyer in St. Augustine: Should I Rent or Buy?

August 9th, 2010

by Sean Hess (www.SeanHess.com), Broker and Manager for St. Augustine Team Realty (www.StAugustineTeamRealty.com).   Follow us on Facebook.

You’ve never owned a home before and you’re thinking about buying one.  Here’s some things to consider: 

Just because you’re not an investor doesn’t mean you’re not worried about depreciation. If you don’t plan on living in this house for more than three years, consider renting.  While the residential market in St. Augustine has stabilized (the exception being condos), there is still a possibility of depreciation or no appreciation in the short term.  If you move in three years your closing costs will wipe out any minor appreciation gains you make.  Another plus when you rent: anything that breaks down is somebody else’s problem.

But:

Chances are good you’ll have a lower monthly payment if you buy. Interest rates are so low and home prices are so good your mortgage (plus your escrows for taxes and insurance each month) will be less than rent for a comparable home.  

If you buy a condo you could get a mega-good deal, but the condo will likely depreciate a bit by next year.  But that may be okay…the low interest rate plus the price could likely offset the depreciation (versus paying more for the same condo at a higher interest rate down the road…plus the payment will be going against the principle versus being lost as rent over that period).   

And finally:

Rent will go up every year but your home payment will remain stable.  The principal and interest payment on your home will never change, but your rent will.  If you escrow* your taxes and insurance, these two items will likely increase at least a bit every year, so your overall home payment will go up to…but not as much as rent, especially over the long term.

*Most banks like you to escrow your taxes and insurance so the money is there at the end of the year to pay both.  Since both go up, and both are tacked to your monthly home payment, it goes up.  Banks like it this way because in the case of foreclosure a) if taxes are owed the government get their money first and b) if the house burns down they can only collect on the lot the home was built on.  But some banks let you pay the insurance and taxes yourself when they come due, so if you feel comfortable doing that, by all means do so.

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Posted in St. Augustine Real Estate, buy vs. rent, buying in st. augustine, first time buyer, moving to st. augustine | 1 Comment »

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