Andy Weiser Fort Lauderdale Realtor Blog

What is Flood Insurance?

Flood protection is the extra coverage that some homes may require in the event that they are in a high hazard area. Insurers will use geographical maps that distinguish floodplains, floodways and specific marshes that are apt to flood to check whether your home falls inside these higher danger zones. These premiums can sometimes be a significant cost which is the reason why it is essential to see how these function and what precisely is covered.

How is flood insurance calculated?

Various components are considered for your flood protection premium. For one thing, the precise location will indicate how high of a danger your house is at taking into account flood zone territories. Next, the age and design of your house are considered as the physical structure has an influence. Homes that are in high hazard regions that were built after the main Flood Insurance Rate Maps were made will factor in the elevation of the home in connection to the flood elevation. Finally, the plan and coverage purchased will likewise assume its part in how your premium is configured.

What is and is not covered

Flood protection covers a great part of the physical harm brought on to your home and to your possessions. The property is covered with respect to its structure, electrical and plumbing frameworks, built-in appliances, HVAC, permanent flooring and walls, window treatments, detached garages and debris removal.

Your policy will also cover numerous individual things. This is inclusive of apparel, furniture, curtains and shades, compact AC units, microwaves and dishwashers. Additional items include washer/dryers, freezers including the food in them and select high-esteemed collectables, for example art or fur garments up to $2,500.

The larger part of your household items will be covered. Things that won’t be incorporated include your vehicles, temporary everyday costs, cash or valuable printed material, money related misfortune created by the obstructed utilization of home, additional property like hot tubs, decks or wells and any harm brought about by dampness that could have been avoided by the property’s owner.

How to lower your insurance premium

Flood protection definitely adds an extra cost to owning a high hazard home. Be that as it may, there are numerous ways that you can decrease the cost of your premium as you minimize this additional expense. These incorporate elevating your utilities to higher areas in the structure or by introducing “flood vents” to minimize additional harm by water pressure. At long last for a few, raising the structure over the base flood elevation might be an option. This is a more expensive methodology, yet relying upon your home’s area and premium it might counterbalance your expenses.

Where does flood insurance cost the most?

Flood insurance can truly change in cost from relatively insignificant to a costly expense. The genuine answer of where it will cost the most relies on upon where your home falls inside these classes:

Moderate to low risk: These areas are typically the lowest for their premiums as they are the least likely to flood. They are also referenced as “Non-special flood hazard area” or NFSA.

High risk areas: Also known as “Special Flood Hazard Area” or SFHA, these areas have higher premiums as they are at a higher risk with a one in four chance of flooding during a 30 year mortgage cycle as determined by FEMA.

In the event that you are thinking about a home near the water, it is a good idea to contact your insurance agent and acquire a point by point gauge on what a policy will cost you. As floods are amongst the most widely recognized disasters in the United States as indicated by FEMA, you might consider flood protection regardless of the fact that your property is not in the highest risk territory for flood hazard.

Do Green Features Sell Homes?

New construction is ramping up all over the country as our economy strengthens. In some new homes environmentally friendly features are being included as more buyers are going green. For those who are not as concerned about the environment, the cost savings aspect can sometimes be compelling enough. However, if this technology comes at an added premium up front, are buyers willing to part with the extra cash? The reports state it all depends on the actual feature and benefit.

Convenience or “Wow” Factor
Buyers have shown a pattern of splurging for items that they can physically feel or show off to their guests. For example, a media room, upgraded chef’s kitchen or spa-like bath are easier sells while a special boiler are less visible and not appreciated as much.

Green features have proven to fall somewhere in between depending on the benefit. Technology features like an HVAC system controlled by your smartphone have shown that buyers are willing to pony up the cash for these convenient and cost effective items. On the contrary, a unique air purification system tends not to rank so high up on the upgrade wish list.

Cost Savings
Not all of the green features of today offer something particularly “cool” or have a “wow” factor. However, should any of these offerings come with a substantial cost savings due to efficiency, that is where buyers become intrigued.

In some cases these upgrades may not necessarily recoup their expense dollar for dollar as in the case with solar panels or a high tech thermostat. However, these items should be regarded much like a remodeled kitchen or bathroom. They offer an upgrade in function as well as the benefit of everyday efficiency and enjoyment.

New Construction
Developers can face a difficult decision when they are debating the addition of green features to their product. It can be a catchy angle to play up in marketing their homes, but the challenge is educating buyers on the cost-benefit so they can be sure to recoup their added investment.

An experiment was recently done by a Somers, New York developer. They had built similar homes and offered custom finishes per each buyer’s preferences. One option was to go for an upgrade adding a geothermal heating and cooling system. The cost for this was an additional $50,000, but the buyer would receive a $30,000 tax credit from the government. Also, to soften the hit of the expense, the up front cost would be rolled into the mortgage making it even more affordable by spreading it out over the life of the mortgage. Ultimately the buyers would realize the savings with lower their energy bills by a few hundred dollars per month within five years.

The findings showed that half of the buyers had upgraded to this system. Purchases were driven by a personal and financial decision for these buyers. While some had reached their maximum budget, others were not planning on residing in the home long enough to realize the cost benefit.

Green is on the rise
Green living is slowly becoming the new norm with the number of buyers searching for environmentally friendly housing is growing. These buyers are less cost sensitive to the added expense for earth preserving initiatives much like how we have seen with hybrid vehicles. While time goes on the technology becomes more affordable and these type of features become more popular in homes of today.

South Florida Foreclosures Decrease in Q1

The first quarter of 2016 has shown a decline in the number of foreclosure cases in South Florida proving that the tri-county region has certainly rebounded from the recent housing crisis. According to RealtyTrac, the foreclosure listing firm, the number of foreclosures was down 24% from the same time last year.

During the peak time of the recent housing crisis in the third quarter of 2010, more than 58,000 properties were dealing with problem mortgages. Meanwhile in the first quarter of this year there were only 10,000 South Florida homes in some stage of foreclosure.

“The market goes in cycles, but we’re definitely, firmly back to what we would consider a normal and healthy level of foreclosure activity,” said Daren Blomquist, a vice president of RealtyTrac.

Of all of the 216 markets analyzed which included Florida, more than a third have dropped to a number of foreclosures that is below their pre-recession levels. As the economy has strengthened in both the housing and job markets it has made for better conditions for struggling homeowners.

For many people, “foreclosure was just inevitable,” said Tom Ice, a South Florida real estate lawyer. “The big problem with being ‘underwater’ on your mortgage is that you couldn’t sell the house. You had no equity to work with. But as soon as prices started to creep up, all of that [went] away.”

Ice and other industry professionals cite that lenders might be delaying the filing of foreclosures until the Florida Supreme Court decides how the statute of limitations affects older cases. The delay is not expected to yield another wave of distressed loans however.

The Third District Court of Appeal has basically stated that the statute of limitations does not expire during the life of a mortgage. In other words, those who had foreclosures dismissed over five years ago could possibly see their lenders re-filing their cases. According to RealtyTrac, the majority of foreclosures of today stemmed back to the most recent housing crisis. The homes that completed their process in the first quarter of this year had an average of 1,018 days to make their way through the system.

As all signs have been indicating a strong forecast in 2016 for the real estate market, we should only anticipate normality in the market all around.

Slim Chance of South Florida Home Prices Falling

New data shows that South Florida homeowners are in a good position with little to worry about for any decrease in home values.

A recent report by Arch Mortgage Insurance Company states that the likelihood of prices declining in Palm Beach County in the next two years is only a 3% chance. Broward and Miami-Dade counties along with 22 other areas in Florida have a mere 2% chance of price declines. To put things into perspective, the national average is 5%.

“I’m bullish,” said Ralph DeFranco, chief economist for Arch. “I think it’s a good time to buy. Interest rates are low, so buyers should lock in while they can.”

Many things are taken into consideration with the forecast that the Arch risk index report creates. They analyze things including median home prices from the Federal Housing Finance Agency while factoring in regional unemployment rates, affordability, change in population, housing starts and delinquent mortgages.

Palm Beach County based chief economist for the Metrostudy research firm, Brad Hunter, states he is not concerned with any part of the market either.

“One could easily make a strong case that prices will keep moving up, albeit at a slower pace,” he said. “I think it’s a single-digit probability that we see a real decline in home prices.”

Jack McCabe, another analyst in Deerfield Beach states that the strong demand and lack of supply of homes in lower price ranges will continue to nudge values of the luxury homes and condominiums higher.

A recent report by Ten-X, an online real estate marketplace in Irvine California listed the top real estate markets for this spring of 2016. Two Florida markets were in the top 5 with Palm Beach County coming in at fourth and Broward county being fifth. Ten-X used similar reporting methods based on home price increases, affordability and future demand based on local economic conditions.

“Florida, in general, seems to be doing really well,” said Rick Sharga, executive vice president of Ten-X. “Of the states that were hit hardest during the crash, Florida still has the most room to grow to get back to peak housing prices.”

4 Steps to Buying a Second Home

No matter what you are considering for a second home, it can be very exciting but it is also a large decision. Either a place to get away to on weekends or even a seasonal home to enjoy by the beach, here are some items to consider to see if a you are ready to make the move.

Affordability – Take a look at what homes cost that are in your area of interest and consider the monthly mortgage cost alone. Also, keep in mind that second home mortgages do come with a higher interest rate than your primary in case you are thinking of renting it out. Then factor in your additional expenses like insurance, taxes and regular utilities and maintenance. For single families, you may want to consider a property manager if you are not nearby or visiting often. Condominiums typically have association fees that will handle most of what needs to be done.

Location – Decide on a location that serves your needs all year round or often enough to make it worth owning. A beach location like Fort Lauderdale can be enjoyed throughout the entire year making it useful at any time that you can visit. Even if your usage is limited, selecting the right location can make renting it during the times you are away much easier.

Insurance – A good rule of thumb is to connect with your current insurance agent about the type of home you are considering. Begin the discussion with your current provider as they may offer you a better rate as an existing client. Consider things like flood zones or other hazard insurances that you may want to purchase.

Find your home and enjoy the benefits – Once you have done your due diligence and established your comfortable budget, then comes the fun part, finding your dream home and enjoying the benefits. After you have found your home and completed the purchase, it is time to enjoy it! You will soon discover the many advantages of having this home away from home. Not only is it yours, but it can also be cost effective in comparison to expensive hotels or rentals. Also, it is your home so it is always available and with no crowds. Finally, if you keep your home long term, you are building equity and also may have the option of renting it as well for additional income.

Your vacation home should be your oasis – a place to getaway, relax and fully enjoy your life in.

How to Invest Your Tax Return in Your Home

The spring brings us an exciting season, great weather and for some of us a tax refund check from the IRS. What are some of the best ways that you can spend that money? Investing these funds back into your home can not only provide you with some instant gratification, but can also add value to your home that can pay off when it comes time to sell.

According to research teams from the National Association of Realtors and Realtor Magazine there are many great ideas to make the best of these bonus funds. The result of their findings show which property enhancements offered the best return on investment. Here were their best performing projects.

Front Door – Updating that tired or worn front door with an architecturally stimulating new one can not only boost your home’s curb appeal, but it can also increase energy efficiency and safety. A new steel entry door on average costs just over $1,100 but has a ROI of over 96%.

Garage Door – In the same interest of exterior doors, replacing old garage doors with a modern one will cost on average about $1,500 and has an ROI of over 83%. Garages are often a highly sought after amenity that has a big impact on the aesthetics of your home so this is a great investment to consider.

Windows – Last, but not least for the appearance of your home’s exterior would be the importance of high quality, high impact windows. New, energy efficient and high impact windows will cut down on your monthly energy costs, potentially your insurance bill and can sometimes earn you tax credits with select models. Replacing windows high impact windows can often see between an 80-86% ROI.

Deck – Decks can provide a great platform for outdoor entertainment and enjoyment.  A 16 foot by 20 foot deck will cost on average about $9,500 but you will gain an 87.4% return on it upon resale. For those who already have a deck, consider improving it with a fresh coat of paint or stain, adding a bench or installing screening.

Update Your Kitchen – Kitchens are one of the most important rooms as they are one of the biggest focal points in every home. Having a modern kitchen can substantially add value to your home as a result. The good news is you don’t always have to gut your kitchen down to the studs to add great value. Sometimes you can keep your existing cabinets but replace the doors and drawers. Add new energy efficient appliances, new sink and countertops and you will have made a big improvement for significantly less than a full remodel. This type of mid-range remodel can yield an estimated 82% ROI.

Finally, if you are interested in another great financial move but don’t want to deal with a project, consider making one extra mortgage payment per year applied to your mortgage principal. This can substantially reduce your overall debt. In fact, one extra mortgage payment per year brings the lifespan of a 30 year mortgage down to 22 years. Make this even more budget friendly and spread that payment over 12 months by paying 1/12th per month.