Bonnie's Blog: Hollywood News and Market Info.

I pulled a report this week from TREND GRAPHICS on Broward County Home Sales and compared sales on SINGLE FAMILY HOMES in February 2008 and April of 2009.... the change in the market was amazing... take a peek:

                                FEB 2008        APRIL 2009

Homes For Sale             14,257            9,685

Homes Sold                   415                 743

Went under Contract     645                1,585

Months of Inventory       34                   13 Top should be 6

Ave.Price per Sq ft        $192              $130

Days On Market             117                104

It's interesting to note that pending sales have more than doubled but the average days on market has not reduced that much...meaning that most are pricing too high in the beginning and selling after numerous reductions.  The amoung of inventory is almost half of what it was... a fact I can personally attest to.  As buyers are coming out of the woodwork ready to now buy, the inventory has dwindled in each of the various price ranges. Specifically $200,000-$400,000.  As new homes come on the market I have found that there are many offers at once.  

If you have a home you are thinking of selling in the range of $200,000 - $400,000 please call me as soon as possible.  I have numerous buyers who want to move into the area.

The average price per sq ft has gone down dramatically as the market starts to stablize and we see sales of homes priced just at or under market value.  Which brings me to the appraisal situation here in Hollywood Hills and Emerald Hills.

Appraisals are a big problem in the area for many sellers.  A beautiful 3bedroom, 2 bath home in Emerald Hills is appraising for $340,000!!!  Even if a buyer is willing to pay higher for a 3/2 home in Emerald Hills with a 2 car garage and a pool, many banks WILL NOT lend based on current appraisals.  If you live in Hollywood Hills and think you can still get $350,000 or more for your home, the news for you isn't pretty.  If you can get more realistic in pricing to sell, you WILL SELL FAST as the demand is there now.

I had a cash buyer last week with an agreed upon contract of $390,000 on a completely remodeled home, on an oversized lot. (In Emerald Hills)  They questioned the value when the appraisal came in at $340,000.  They requested another $15,000 reduction from the seller.   We were fortunate they had cash otherwise a lender would have required the seller to reduce even further.

Good news.... SALES ARE UP!!!! Bad News....Prices are DOWN!  If you want to move, you can, and you will!   Call me to discuss how we can price right, and market your home to entice the motivated buyers!

Currently servicing Emerald Hills, Hollywood Hills, Hollywood Oaks, Forest View Estates, Cooper City and Davie, Florida.

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Bonnie

www.HomesInHollywoodFlorida.com

www.HousesInEmeraldHills.com

www.BonnieKaufman.com

www.RepairYourNegativeCredit.com

Interesting concept... does it make sense for everyone??  Does it really pay?Check out this article from e-Brief for Sunday, May 31  "The latest and greatest real estate news and advice, right to your inbox."

Home Equity Protection Plans Gain in Popularity

Watching a home's value plunge by double-digit percentages in a matter of months is enough to unnerve even the most financially secure homeowner. And, as the real estate market continues to reel concerns are growing that the free fall is far from over.

Playing into that anxiety are two companies – EquityLock Financial, based in Austin, Texas, and Lighthouse Group based in Charlotte, N.C. – that are selling products promising to put a little more control in homeowners' hands. Their pitch? That homeowners could spend a little now to hedge against declines in the value of their home later.

Here's how it works: For a fee of 1% to 3% of their home's value, homeowners buy a contract that protects them against the loss of equity in their home if the market takes a turn for the worse. The contract, which should not be confused with an insurance policy, pays the homeowner when he sells his home in a market where average home prices have dropped since their purchase. The amount he receives is tied to the size of the market's decline, as measured by one of two home price indexes (both of which are based on sales of single-family homes).

Say you buy a home in Denver for $300,000. Five years later, after Denver's home price index falls 10%, you sell it for $290,000. At closing, the company you bought the equity protection from pays you $30,000 – your original purchase price times 10%. Even if you sold your home for more than what you paid to buy it, you can still make the claim – as long as the index fell. (If the index rises, however, you can't make a claim and you're out the $6,000 you spent buying the contract.)

"It's the kind of product that ends up being useful for a niche part of the population, but likely not really worthwhile for homeowners in general," says Todd Sinai, associate professor of real estate at the Wharton School.

One factor to consider is how long you plan to live in your home. If it's going to be 10 or 15 years, buying protection doesn't make much sense, says Susan Wachter, real estate professor at Wharton. While home prices can change dramatically in the short term, they hold steady and increase over longer periods. For short-term homeowners, though, it might make more sense. If, for instance, you anticipate a move for work and worry that area prices will sag, the protection can be worthwhile, says Sinai.

We spoke with real estate experts about what to look out for when shopping for home equity protection plans. Here's what they had to say:

Calculate the costs

Payment terms are different for each product. EquityLock's premium, which is paid upfront, ranges from 1% to 3% of the purchase price (or of the current value if you already own a home). Lighthouse's premium could be paid either on a monthly or yearly basis, and typically works out to just under 1% of the home's value, per year, says a company spokesman.

Say your house is worth $300,000 and you pay $6,000 (a 2% premium) for EquityLock's protection. You're starting with a $6,000 loss, and you'll only break even if the house index drops enough from the time you purchase the home to the time you decide to sell. "You really have to think hard if the initial cost is worth it," says Sinai.

Watch out for lockout periods

Be sure to ask about any lockout period which bars you from collecting payment before a set time. EquityLock imposes an exclusion term ranging from 18 to 30 months from the time the protection is purchased. So you can't sell your home and make a claim a year after the contract begins. Lighthouse has no lockout period. But if a homeowner exercises the contract after, say, the first month, they still owe the future monthly payments that are due.

Housing indexes are imperfect

Potential payouts are tied to a house price index: either the S&P Case-Shiller house price index, which tracks 20 metro markets, or the Federal Housing Finance Agency's House Price Index, commonly known as OFHEO, which covers 386 markets. The problem? Indexes don't capture the true volatility and variation within markets – and don't always correlate with the specific value of your home, says Jonathan Adams, a finance professor at NYU. For example, if highway construction has just gotten underway at the next block over, chances are your home's value would dive – but the index might stay the same, says Adams. (Lighthouse says tying the contract to an index is the most efficient way to determine a home's value, without having to actually sell the house or get an appraisal.)

Be wary of new, untested products

Bear in mind the novelty of these plans when assessing their worth. "When it comes to finances and your home equity, you really want to go with someone who has a history," says Alison Southwick, spokeswoman for the Better Business Bureau. Also, new products tend to be more expensive, says Mark Browne, professor of risk management at the University of Wisconsin. They haven't been around for long, so it might be better to wait for competition to build.

Bonnie Kaufman...your Hollywood, Florida Real Estate Expert.

Emerald Hills, Hollywood Hills, Hollywood Oaks, Cooper City, Davie, Aventura and Dania Beach

Greetings Hollywood!!!

It's been a while since I've written!!!  So much is going on in the area and there is a lot of info to share.  Home sales are up..especially in Hollywood Hills with a dramatic drop in inventory of homes priced between $200,000 and $300,000.  If you have a home to sell in that price range please get in touch.  I am getting at least 5 calls a day from buyers wanting to move into the area and unable to find a home.  Prices in Emerald Hills have taken a real dip with appraisers coming in on NICE, remodeled 3/2's with pools and garages at a high of $340,000!!!!  There have been numerous Emerald Hills sales in the $295,000 range as CRAZY as that sounds.   Details to follow in the very near future.

Be on the lookout for a revamped website and My Hollywood Home News to be in your mailboxes sometime next month.   If you are interested in advertising in the HOLLYWOOD HOME NEWS and reaching approximately 10,000 Hollywood homes a month for mere pennies per home please contact me through this site or my office at (954)985-8336.

Wishing all of you MOMS out there a beautiful Mother's Day!!!

Bonnie

www.HomesInHollywoodFlorida.com

www.HousesInEmeraldHills.com

Specializing in Emerald Hills, Hollywood Hills, Hollywood Oaks, Cooper City, Aventura and Davie Florida

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