Next Thursday, October 2nd, marks the first day of the Ormond Beach Farmer's Market, I'm told that Thursday is the traditional day of farmer's markets; I'm just glad to have one in Ormond Beach! For years Daytona Beach has offered a fantastic farmer's marketing on City Island on Saturday mornings. Flagler Beach has offered a great market on Fridays and a smaller solution on Saturdays. However, Ormond has been forced to head elsewhere.

No more! Ormond's Farmer's Market was established by Ormond Mainstreet, an organization dedicated to the furtherance of Ormond's downtown district. The new Farmer's Market is sanctioned by the City of Ormond Beach and should be a real asset to the community.

The Ormond Beach Farmer's Market will be headquartered at the Rockefeller Gardens. The location is at the corner of Granada (Ormond's mainstreet) and Riverside Drive, directly at the base of the Granada Bridge. The Rockefeller Gardens are so named because they were originally the garden area of the Casements (the winter and retirement home of John D. Rockefeller). The location is directly on the Intracoastal Waterway and has fantastic views. 

The location has ample parking at the Casements (across Riverside from the park), Fortunato Park (John Anderson and Granada), and surrounding areas. Ormond Beach is unique in the area in that all four corners of the bridge across the Intracoastal Waterway are dedicated parkland. 

Market hours are from 7:00 am to 1:00 pm. Visitors and locals alike are encouraged to visit the new Farmer's Market!

Fed Funds Rate and Mortgage Interest Rates

Intro

The Federal Funds Rate is the interest rate that banks charge one another to lend money. The rate is set by the Chairman of the Federal Reserve and is a key way that the Fed can control the supply of money. A lower Fed Funds Rate can lead to lower interest rates charged by banks to consumers. Recently, interest rates on mortgages have been at historic lows. I thought it would be interesting to look at how the Fed Funds Rate corresponds. 

Fed Funds Rate Data

The Federal Reserve conveniently provides a system for downloading data. This chart represents data from January 1970 through This post date.

 

Fed Funds Rate 1970 to current

As you’ll notice, the Fed Funds Rate varies from time to time. However, it has never been as low as it is right now. The rates truly are at an all-time low. You may also be interested in a closer look at recent data…

 

Fed Funds Rate 2005 to current

The recent data shows that the rates are not only at historic lows over a long period of time but are actually almos zero. They prbably can’t get any lower. A rate lower than zero would actually represent losing money when lending it.

Conventional Mortage Rates

I also wanted to revew the actual rates for conventional mortgages. When a buyer is purchasing a home, the interest rate on thier mortgage effects the monthly payment. A lower interest rate can have a tremendous amountof effect on the price of the home that a buyer can buy. Alternatively, it can reduce the monthly price on an existing home in order to make it more compelling to buy vs. rent.

This graph shows the convential mortgage interest rates from 1970 to this post date:

 

Interest Rates 1970-2009

Clearly, the effect of the Federal Reserve’s monetary policy and the effect of the Fed Funds Rate is visible in this graph. Also, you’ll note that today’s rates truly are the lowest in recent history.  Lastly, to round things out, we can look at a closeup of recent interest rate history.

 

Interest Rates on Conventional Mortgages 2005-2009

Again you’ll note that while we have enjoyed lower interest rates for many years now, the rates have never been quite as good as they are right now.

 

Summary

Ultimately, there are numerous reports that discuss now being a good time to buy and that interest rates are at the lowest they have ever been. I wanted to look at the hard numbers. The numbers do, in fact, bear out the reports. With the interest rates as low as they are, far more people should be able to achieve home ownership. The $8,000 tax credit that has been offered by the government should help to stimulate that effect. 

I’ll continue to review where we are in the life cycle of the market adjustment and some of the factors that help and hinder our recovery. After reviewing this data in more detail, interest rates should certainly be credited on the HELP side of the equation.

I'm still trying to determine if I'm encouraged by the latest news from the Commerce Department that homes ales declined 0.6 per cent last month. The report states that the decline is less than half of what had been predicted. That sounds encouraging but makes me worry that July and August will come in week. Certainly I'm hopeful that we're seeing a reversal but I'm not so naive to stake my expectations on one month.

I like to put in light, however, of what we're seeing in our local market. We're starting to see the number of units moving picking up. At the same time, the trend that includes the true deals selling seems to also be increasing. The result of foreclosed or financially stressed homes in the market has been a continued price decline. Further, we're seeing that price decline accelerate. I don't necessarilly see that as a bad trend as we have long had too much inventory on the market and economic forces must eventually win over.

Ultimately, when I look at the information, our prices are currently in line with where we were before the huge price leaps of 2004, 2005, and even 2006 (when prices were going up while transactions were dropping off). Ultimately, if the pricing trend continues much longer, there will be investor steal showing up more and more frequently.

  WASHINGTON - The Bush adminis­tration is suspending a 5-year-old rule intended to deter property flip­pers as part of an effort to help speed the sale of foreclosed properties.
  For one year, the Federal Housing Administration will no longer im­pose a 90-day waiting period before foreclosed properties can be sold and receive government-backed loans.
  The policy aimed to deter property flipping schemes, in which buyers are overcharged for foreclosures. But the surge in vacant properties result­ing from borrowers who were unable to afford their mortgages has become a far more pressing concern.
  - Associated Press

This short article came out today. I'm not certain that it will have much effect given the market today. Flippers are not quite as common place as they once were. However, government loans are clearly becoming more and more important. Ultimately, this is a possitive thing for the regular buyer who, for one reason or another, needs to sell a foreclosed home that they had bought.

I had an interesting conversation yesterday with a seller. The seller owns property in Florida which was purchased as an investment. The property's just value according to the property appraiser is about $225,000. The owner owes over $400,000. The proeprty has been listed for some time and I was discussing the possible opportunity of  a short sale. The seller's intent was to allow the bank to foreclose with the expectation that she would be finished with it. Unfortunately, she didn't understand that the bank has rights beyond the mortgage. Specifically, that the bank has the right to come after a seller if the property sale does not cover the value of the mortgage.

In the local paper in our area we read about stories of people mailing their keys to the bank or allowing the bank to have the property and walking away. In these cases, I assume that they are referring to a deed in lieu, however, I don't think many owners understand the opportunities available to them. I am further concerned that sellers believe that they can simply stop payment on their investments and the bank will take the proeprty and drop the issue. Is anyone else experiencing these types of problems? How are brokers and agents educating property owners as to their options?

Thanks for you input...

“I think this will be a time of continued consolidation among brokerages and we are always on the lookout for the right opportunity. We have had the highest opinion of West Volusia Properties ever since our first transaction together when we bought our office in a historic building across the street from their office. In that transaction, Maggi Hall personally represented the seller” stated Robert L. Adams, President and CEO of Adams, Cameron & Co.

Maggi Hall, Broker/Owner of West Volusia Properties added, “We are thrilled to be able to bring these two organizations together. As the real estate market changes it becomes more and more important for sellers and real estate agents to work with a company that can bring the resources of an industry leader such as Adams, Cameron & Co.”

West Volusia Properties was established in 2001 by native Floridian Maggi Hall, Broker/Owner. WVP is located in historic downtown DeLand and initiated a "New Urbanism Movement" adjacent to downtown DeLand between Howry and Euclid Avenues and Woodland Boulevard and Amelia Avenue. Now named the "Garden District," this once neglected 4-square block of over 90 dilapidated buildings sporting drugs, prostitutes, and decay was featured in the April 2004 issue of Southern Living.

Founded in 1963, Adams, Cameron & Co. is the Daytona Beach Area's largest real estate company with 300 agents in twelve offices throughout Volusia and Flagler counties. Adams, Cameron & Co. is pleased to support the area’s residential and commercial real estate needs by bringing the most resources available with a pleasant family run atmosphere.

I wanted to drop everyone a line with regards to some fantastic news we recently heard. Three times each year we hold an event that we call Open House Extravaganza. I know a lot of brokerages do something similar. We like to have over 100 homes whenever we have one and have had over 300 at events in the past. The last few times that we've held the event we've heard very little positive feedback from agents. Unfortunately, many of them were not seeing the  buyers come through the open houses.

Last weekend we held our event and the results were overwhelmingly positive. One open house had over 30 people walk through. Several reported more than ten prospects. We had very few of the over one hundred that reported no prospects. I think that is a fantastic result. We always run at least one full color full page ad for the event and the reports were that people carried the advertisement into the open houses. One of our agents commented that he thinks the buyers are starved for open houses as agents have slowed down the number that they are holding. That's great news!

I wanted to post it to give everyone a little bit of the encouragement that I've felt after talking with the agents but also to see if others had heard the same results. Please leave me a comment with good or bad info and let me know where you are!

Best to everyone,

John Adams     

I appreciate you taking the time to contact me regarding the rising cost of property taxes in our state.  The legislature has just completed the final version of legislation that, if the courts approve, will be a Constitutional Amendment on the January 29^th ballot.  There are five parts to this legislation which are as follows:

1. Portability - when a homeowner moves into a more valuable home, the entire savings they receive under Save Our Homes is transferred to their new home.  If the new home is less valuable, the transferred savings will be proportional to the value of the new home.

2.      Double Homestead Exemption - an additional $25,000 homestead exemption is provided for the value of homestead property above $50,000.  This exemption does not apply to school taxes

3.      Tangible Personal Property Tax Exemption - business owners and mobile home owners may claim a $25,000 exemption from ad valorem taxes on tangible personal property taxes.

4.      Fiscally Constrained Counties - the state will provide funding to offset the reduction in revenues from property taxes for those counties which have proven to be fiscally constrained.  Counties will be required to submit documentation to support their requests for additional funds.

5.      Assessment Cap for Non-Homestead Property - does not take affect until the 2009 tax roll if passed January 29, 2008.  Does not apply to school taxes.  Remains with the property for business properties and housing with ten units or more until the sale of the property.

Although I am pleased that portability has been included in this legislation, I believe it will be necessary to do much more to address the increasing property tax problem in our state.

Senator Evelyn Lynn
District 7

Save Our Homes (SOH) Portability Update!

I would like to thank each and everyone of you for your support. We have come a long way, since four years ago, when I first filed the portability legislation. Last Monday all of our hard work paid off and both the House and Senate overwhelmingly  supported  and voted for portability. Even some legislators who voted against the overall tax package  were quoted as saying that they did so because it did not provide enough relief.

Locally, Senator Jeff Atwater and Senator Ken Pruitt as well as Democrat Senators Bullard, Deutch and Aronberg supported portability. In the House, Democrat Representatives Brandenburg, Vana, Sachs, Skidmore and Machek joined with Republicans Reps. Domino, Snyder, Hasner and Bogdanoff  in voting for portability.

Immediately after the vote, Gov. Crist held a press conference during which he pointed out the importance of portability and generously mentioned my name as the "Father of Portability."

However, our job is not yet complete. Already some opponents are complaining that it will take away revenues and devastate local government. But they fail to acknowledge that  without portability potential real estate transfers fail to occur because the high tax burdon will produce only imaginary revenues .  

Moreover, by bolstering real estate sales, additional Doc Stamps and Sales Tax revenues will be realized.  Also opponents claim that portability is unconstitutional. However, even though I am not an attorney, I find that often when a measure cannot be defeated on it's merits then they use the "unconstitutional" claim.

I would like to remind everyone that when we first embraced portability Gov. Crist was our Attorney General.  FSU law professor Nat Stern concluded that portability was constitutional.

On January 29th, we will need to get 60% of the voters to agree that portability should be in the Constitution. Gov. Crist will lead the charge and most legislators will join in. Personally, I feel confident that we have a strong case and the voters will support this Constitutional Amendment. Let those who object to tax relief continue to make their case that government is too small. .

Once again, I would like to congratulate all of the supporters for making this happen. But the job is
not yet complete and we cannot relax until we win approval on January 29th. 

Carl J. Domino

District 83