Some information on BFIs...

The Florida market is in an upswing. Over the past year, prices have gone up 17% and the available market is only one third of what it used to be. Not to mention that money is still cheap to borrow. People are shopping—and they are buying. This does not only apply to residential homes—commercial and investment properties are also extremely busy.

The commercial market always stays behind the residential sales, whether the prices are dropping or going up. You can easily identify commercial opportunities with a BFI. A BFI document is an executive summary of a potential acquisition that will indicate why a client should be drawn to a project. It is, in essence, the first paragraph of a good resume—it’s purpose to draw the client in to read into the rest of the project, and then call in for more information.

To get a good BFI opening statement may take weeks of analysis of a project. It is the opening statement that carries all the meat of the presentation. Here is an example:

The Opportunity:

            To acquire an off market 200+ unit broken condominium project in Lee County, Florida for $30 million dollars ($23 million purchase price, $5 million in improvements and  $2 in carry cost) that will provide a three year return of 96% based on available financing.

The “off market” tells the buyer the deal has not been shopped.  The “broken condo” tells him it’s probably banked owned. “Available Financing” tells him that this can be a leveraged deal.  Now he is going to want to read the rest of the document to flesh out the details.

The BFI may refer to CAP rates (Capitalization Rates), IRR (Internal Rates of Return), LTV ( Loan to Values) and may include absorption studies, BOVs (Broker Opinions of Value), and Market Analysis. Of course, the BFI will not contain all of those details, but those studies have to be done in order to distill the information presented in just a few pages. 

BFI’s are normally done for larger projects but there are also tools we use for single family home and smaller investments as well. The bottom line is that there are opportunities in today’s market. Analysis and knowledge are still critical and so is the use of a knowledgeable profession real estate agency and agent. You not only need the answers to your questions, you need to know the right questions to ask. 

Buffett's housing bet pays off

Investment guru Warren Buffet said it's time to put money in real estate. His firm got an 11% return - $40M - in 2Q. Read more.

Check out this site!

Interesting concept to help home owners with upside mortgages, Maybe it can work in Florida as well, I’ll have to follow this one and keep you informed.

Tad

http://www.floridarealtors.org/NewsAndEvents/article.cfm?p=1&id=278347

Is your upside down mortgage dragging you down?

I have had many discussions about foreclosures, short sales, upside down loans, overdue credit cards bills, and the ethics of stopping payments on a mortgage and indeed bankruptcy with many  friends that have found themselves in this unfortunate situation. The few friends that have made the decision to move forward without the excess baggage of debt and the fear of their own ethical and financial demise have described almost a feeling of weightlessness once that decision was made to move forward. Those who haven’t seem to be in a stagnate state of their life going nowhere.   It is very difficult to move forward with your life and begin the journey of rebuilding try to travel a path to your goal of financial freedom if the path is strewn with excess baggage.

Some thinks to consider:

• Prices are on the rise, but you may not be rising quickly enough to help you soon enough
• The clock is ticking – both on your recovery and on the tools that are here to help you recover.   The sooner you get rid of your baggage the sooner you can begin recovery. At the end of this year the Mortgage Debt Relief Act of 2007 will expire so you need to get your house listed as a short sale now.
• There should be no shame or ethical dilemma. Get over it.  Yes, I know you were brought up to always keep your promises, but if the bank was only counting on your promise they would not have asked you for a mortgage (A document that says of you can’t keep your promise they can look to your house for resolution).
• You are not in a very exclusive club and there are many members

·         Get your head out of the sand, regain your pride, and move forward

• Get an appraisal or BPO on your house so you are not guessing how much water is above your head.
• Upside down on your house or know someone who is?  Now is the time to list your home!!!  Contact West Coast Realty to discuss your options.

I am not an attorney and cannot and will never give legal advice. Any one in a tough financial position should always consult an attorney. 

10 Things You Should Consider When Making a Home Inspection (BEFORE You Buy)

With rising prices and multiple offers, homebuyers may feel pressured to make hasty inspections when considering a home. That is, if they make one at all.

A pre-offer inspection should help you structure your offer and, perhaps indicate things that should be further inspected during your due diligence period. When Florida was a buyer’s market, just half a year ago, many times a potential buyer would offer a very attractive high price and then drop it during the inspection. This is annoying to sellers and realtors, and a waste of time. A buyer would drop the price based on something that should have been evident during the pre-offer inspection, like a missing appliance or the necessity to paint the house. If you are in an urgent buy situation, it is wiser to assume that all repairs are needed before offering. If there is time, I would suggest a professional inspection. If there is not time for an inspection at all, either expect the worst or don’t buy at all.

During your due diligence period, there are ten things you should inspect.

1. Defective Drywall (Chinese Drywall). Chinese drywall is bad news. It is most common in houses built or remodeled between 2003 and 2007, and exposure can cause health risks for both your family and any pets in the home. Although there is no definite test for defective drywall, blackened air conditioner coils or copper wires, rotten egg, sulfur-like or acidic smell, and tarnished silverware or silver jewelry are all indicators of defective drywall.
2. Roof. In homes that are over 15 years old or with low pitch roofs, a roof inspection is essential. Many insurance companies will require a roof certification in order to give you homeowner’s insurance. In addition, a small leak can add up to a big cost in a short amount of time.
3. Plumbing. Look for leaks under the sinks, pitting on the chrome of fixtures, pinhole leaks, roots in the soil line, and corroded copper from bad water are all problems that can grow with time. Check the age of the water heater and for corrosion on the valves. 
4. Structure and Foundation. Have the “bones” of the home, the foundation, vents, windows, doors and gutters inspected. Dry rot and wood destroying organisms are prominent in Florida.
5. Electric. Look out for any non-licensed work or additions that were done to the system. 
6. Elevation and Grade. Especially in Florida, we get a lot of rainfall and are prone to flooding. Make sure the home is properly elevated and graded to handle heavy rainfall. 
7. Air Conditioning and Heating. Check the model and serial number of the heater or air conditioner and check the manufacturer’s website to determine the age. Anything over ten years old should probably be replaced. 
8. Insulation. In the walls, in the attic, and under any home that is elevated on wood or concrete. 
9. Appliances. Like air conditioning, check the model and serial number and check online to determine age.
10. Maintenance. A clean presentable home that is well cared for.

You can also check the county for building permits on the property you are considering—these will tell you if there has been recent work done on the property that you should be aware of, or to see if there has been work with no permit pulled. 

When in doubt, always hire a professional.

2012 1st Quarter Snapshot
Cape Coral and Lee County

Look below, the statistics reveal that home prices continue to sky rocket, the demand also remains equally as high, and the inventory is slowly spiraling downward. 

CAPE CORAL, FL:
Total Sales - 1248 Closings (-21% Compared to 2011)
Median Price - $124,900 (+26% Over 2011 or +$26,000)
Average Price - $169,400 (+21% Over 2011 or +$29,700)

Gulf Access - 289 Closings (-7% Compared to 2011)
Median Price - $290,000 (+14% Over 2011 or +$35,800)
Average Price - $382,000 (+12% Over 2011 or +$36,400)

Gulf Access No Bridges - 124 Closings (Flat Comp - No Decline)
Median Price - $295,500 (+19.4% Over 2011 or +$48,000)
Average Price - $382,000 (+18.7% Over 2011 or +$60,600)

Off Water - 831 Closings (-26.7% Compared to 2011)
Median Price - $99,000 (+24% Over 2011 or +$18,587)
Average Price - $110,610 (+19% Over 2011 or +$17,522)

LEE COUNTY:
Transactions - 2943 (-25% Compared to 2011)
Median Price - $124,900 (+39% Over 2011 or +$34,900)
Average Price - $188,565 (+24% Over 2011 or +$36,600)



I bet your thinking, So... what does this have to do with me? Think about it when prices are creeping up and the inventory is low it makes for the perfect time to find the home of your dreams.

STEP 1 - Begin making plans to come to a visit in the beautiful and sunshine filled SW Florida!   Whether you are looking to BUY or SELL, I will do everything I can to help.  Contact me today, Tad 239.281.6692.
Thank you and I look forward to doing business with you! 

Giving Back

This past weekend my company West Coast Realty hosted a great american clean up project in our community. It really made my family and close friends as well as all of the volunteer's realize how important it is to give back to the  community.  It is very easy to get so caught up in our day to day routines, our jobs, our family, our needs. We seldom realize the need surrounding us in our very own community. Many people take the environment we live in and the community we are fortunate enough to have for granted. The point of this post is to inspire who ever reads it to go out and give back. Whether it be cleaning up your neighborhood or going to a local charity ad donating your time. Every little bit counts, and it all adds up. Thanks for reading and I hope you do your part in your community.

Experts predict what I have been predicting for the past year, check it out!

Will housing prices soar by 2014?

NEW YORK – April 4, 2012 – Real estate economists and analysts are increasingly optimistic that the housing market will have a dramatic recovery in the next two years, according to results of a new semi-annual survey of 38 real estate economists and analysts conducted by the Urban Land Institute’s Center for Capital Markets and Real Estate.

The economists predict that the national average for home prices will stop falling by this year and a subsequent turnaround will occur. By next year, they project that home prices will begin to rise by 2 percent, and then get a larger boost of 3.5 percent by 2014. The economists also predict that housing starts will nearly double by next year.

They also foresee rental prices continuing to increase for all property types, ranging from 0.8 percent to 5 percent.

The economists’ predictions were made on assumptions that the economy would continue to strengthen, including a larger drop in unemployment.

“While geopolitical and global economic events could change the forecast going forward, what we see in this survey is confidence that the U.S. real estate economy has weathered the brunt of the recent financial storm and is poised for significant improvement over the next three years,” says Patrick L. Phillips, ULI chief executive officer. “These results hold much promise for the real estate industry.”

Source: “Real Estate Will Rock in 2014,” RISMedia (March 31, 2012)

© Copyright 2012 INFORMATION, INC. Bethesda, MD             (301) 215-4688      

Energy program survey

Lee County is considering a program to provide low-interest financing to property owners for the purpose of making energy efficiency, renewable energy, and/or wind resistance improvements to their homes or businesses. To share your opinion on a Property Assessed Clean Energy (PACE) Program in Lee County, you are invited to take a four-question survey at http://www.surveymonkey.com/s/R7Y7XRG.

The survey will run through March 2, 2012.