Here I go again!  I thought I had learned from the last caper with a short sale. 

My client is a first time home buyer and is getting down payment assistance from a State of Florida organization.

We finally found a house that would pass FHA so we made an offer.  At $96,000, our offer was 12% below the asking price and after nearly a month of haggling, the bank turned us down.

The bank is clearly losing money on our offer but it will cost them double that to foreclose.

My theory is that with the possiblity of a "bailout", the banks aren't negotiating.  It seems like they're waiting to see what they can get from the government before accepting lower offers.

Anyway, we've found another house that may work.  It's a short sale!

updated 3:27 p.m. ET, Fri., May. 16, 2008

WASHINGTON - Construction of new homes posted the biggest increase in more than two years in April. While it was a rare spot of good news for the housing market, analysts said it's far too soon to declare an end to the prolonged slump.

All of us have probably seen one version of this or another.

In a previous blog I was opining the fantasy that home sales have shown some slight improvement in Florida. 

The Florida Association of Realtors (FAR) just ran an article on their website indicating this very notion!  Home sales have statistically improved in Florida!  YAHOO!!

Click here to read the entire article:

http://click.email.floridarealtors.org/?ju=fe561d747c6c077f7015&ls=fe301071736c057e771575&m=feff1070756103&l=fecc177274660379&s=fe561c70756d007f7c1d&jb=ffcf14&t=

Did you know that you can set up an IRA and put your own real estate investments in it?  It's true!  You can also put in LLC partnerships, notes, mortgages and other investments.  Here is an article I wrote for the Florida Times Union (circ. 300,000) about self-directed IRA's:  

http://www.jacksonville.com/tu-online/stories/062406/reh_tax.shtml

There's several ways to go about it.  You can set up an LLC and use that as the investment vehicle.  You can set up a self-directed IRA account and use that.  In either case, you must set it up through a  third party retirement plan administrator to stay legal.  You can't live in your SDIRA property and neither can your immediate relatives.  All of the capital gains on your investments are tax free until the normal IRA requirements kick in.  When that happens...or better....before that happens, there's another way to set up a trust and shelter the earnings even longer!

 If you want more information call me at:  904-422-5091

Richard Newquist

The US is going to try some type of bailout for the foreclosure problem but what?

Barney Frank, Chairman of the House Finance Committee has been talking numbers for some time now but when the Congressional Budget Office reviewed his numbers, Frank had the following to say:

• 4/18/2008
  Frank Statement Correcting FHA Housing and Homeowner Retention Act Summary
  Washington, DC - House Financial Services Committee Chairman Barney Frank, today released the following statement regarding the reference to a Congressional Budget Office (CBO) cost estimate in the summary of H.R.5830: Read full story.

• 4/17/2008
  Economic and Housing Rescue Legislation Introduced in the House Mark up of both measures set for April 23rd and 24th
  Washington, DC - In response to the nationwide economic downturn caused by the housing and credit crisis, members of the House Financial Services Committee today introduced legislation to combat the unprecedented rise in foreclosures, and the associated impact on cities and states.  The legislation first announced by Chairman Barney Frank in March, will be divided into two measures: H.R. 5830, the FHA Housing and Homeowner Retention Act, to expand the FHA program to help refinance at-risk borrowers into viable mortgages and also requires the Federal Reserve Board to conduct a study on the need for an auction or bulk refinancing mechanism.  The second measure, H.R. 5818, the Neighborhood Stabilization Act of 2008, introduced by Subcommittee on Housing and Community Opportunity Chairwoman Maxine Waters, will provide loans and grants to states and cities to deal with problems associated with large numbers of foreclosures in neighborhoods across the country.  Read full story.

• 4/17/2008
  Neighborhood Stabilization Act of 2008 (H.R. 5818)
  Washington, DC -                           Summary Read full story.

Jacksonville Rocks!

Are real estate sales picking up in Jacksonville, Florida?  It does seem so. Anyone have an opinion?
I can't find the references but I have read a couple of comments by realtors that have said
they thought sales were picking up.

Jacksonville has a lot going for it so it ought to be seeing an uptick.  It is the largest city in the U.S.
by area and only has 865,000 residents.  Some of the Fortune 500 companies are located here.  JaxPort
is booming, our highways are being expanded and we have six airports!

Jacksonville Beach sales seem to be improving.  We have some of the best oceanfront deals in the country!
We have great Intracoastal deals.  We have great river property deals. 

I watch the national financial picture as well as monthly indicators in the real estate industry.  I'm quite curious about the real estate industry's reaction to the daily, nay, hourly vacilations.  The dollar is slipping badly on international markets, oil is up, real estate is down.  Our trade balance is a disaster as is our national debt.  It seems the Media is running the national economy as well as the sub-economy of real estate.

 What is 'Big RE's' response to the constant barrage of bad news?  Nada, nothing, zip, zero.  Big brokerages such as Prudential, Century21, RE/MAX, etc., are silent.  NAR, FAR, CAR, WAR, NAR, NAR ad infinitum have done nothing.  Granted, the real estate market has slowed but there are logical economic explanations other than "real estate is a bad investment".  The media rejoices in bad news so the real estate slide helps put a smile on their collective faces.  While that's going on, the entire RE industry sits mum, afraid to spend any propaganda money; afraid to speak up and challange the erroneous thinking that pervades the news media of every genre.

For the last five years, the U.S. Congress had been pushing HUD, Fannie Mae and Freddie Mac to loosen lending rules and get more people into homes.  Now we know that was a really bad idea.  Who gets the blame?  The Real Estate/Mortgage sector.  Actually, the USG and Wall Street are to blame.  Why don't we get the message out?  Why do we let the nation think WE are the bad guys?

Hey, how about the industry stepping up to the plate with money and human talent and take on a few of the smears we are enduring on a daily basis?

The messages could be:  "Now is a great time to buy".  "The RE market is stronger now that the speculators have moved their surplus cash to the stock market".  "Three years ago, buyers could only have dreamed of a market like today's buyer's market"; there's good deals out there baby! 

Let's get the message out boys...and girls!