About Alan Lane

You found my real estate blog. Fantastic!!! I hope you enjoy reading it as much as I enjoy writing it. I was always liked real estate especially hew homes. I am a Florida native and live in Tampa Bay. I’m a Realtor with Keller Williams Realty. If you are relocating to Tampa Bay, I can show you what the Tampa Bay lifestyle has to offer including its wide variety of entertainment options from our beautiful beaches to Walt Disney World and Universal Studios amusement parks. I have a wide variety of real estate experience and education. I have a Bachelor of Science degree in both Real Estate and Finance from Florida State University with over 25 years of real estate experience. My goal is to exceed rather than meet expectations. I believe in customer service and have always been willing to go the extra mile to accommodate the needs of my clients. I specialize in finding new homes for buyers in the Tampa Bay area like the bedroom communities of Brandon, FishHawk Ranch, Riverview, Valrico, and Lakeland. Some of the builders that I follow include Lennar Homes, Pulte Homes, Ryan Homes, KB Homes, M/I Homes, Highland Homes, etc. Follow my Blog for deals on new homes in the Tampa Bay Residential Market as well as other real estate and/or finance related topics. I have always been interested in real estate and finance all my life. My blog is about real estate and finance related topics that interest me. Thanks for reading my blog, Alan Lane

2016 Real Estate Statistics

cropped-cropped-fishhawk-ranch-aquatic-club_thumb.jpgHere is general overview of the most current real estate statistics.  Realtors are selling homes at a faster pace than FSBOs. Continue reading

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What’s the Cost of FHA Financing A Home?

loan_application_clip_art_24699FHA Loans are used to help more people buy homes.  More specifically, they are easier to qualify for.  They are available to borrowers with credit scores as low as 580 and only require a minimum 3.5% down payment (can be higher for lower credit scores) for buyers that are short on cash. FHA requires that the property be in good condition and are generally defined as follows:

  • Health and safety issues
  • Protecting the security of the property, and
  • Structural soundness of the property.

Although FHA-insured mortgages come at a higher cost than a conventional mortgage, this expense could be worthwhile for those who want to own a home and can’t qualify for a conventional mortgage.  FHA loans are insured by paying FHA mortgage insurance.  Unlike conventional loans that allow the seller to contribute 3% of the purchase price towards the buyers closing costs (should cover most, if not all, of the buyer’s closing costs), FHA buyers can ask up to 6% in closing costs.  The main reason for the higher closing cost is the FHA Mortgage Insurance, which is an upfront premium of 1.75% of the loan amount (Could be paid with seller paid closing costs).  In addition, the borrower is going to pay an annual premium (typically ranges between 0.45% and 1.05% of the loan depending on the loan amount).

FHA Loan Example

Here is a real world example of $234,000 home purchase that I recently sold with a FHA Loan:

Loan Payment
Here are the following costs associated with the FHA loan:
  • The upfront premium of 1.75% of the loan amount (in this case, the amount is $229,761) is $3,951.68.
  • The monthly FHA-insurance premium is $158.83 per month, or $1,905.96 annually (or 0.83% of the loan amount).

In this case, the closing costs were $12,367.45 or about 5.29% of the purchase price. Although the seller provided a seller  credit for a portion of the closing costs, the purchaser still had to come out-of-pocket for closing costs (i.e. escrows for both homeowner’s insurance and property taxes, HOA assessments, etc.).   It should be noted that the borrower applied the 3.5% minimum down payment (or $8,190) and prepaid the for the appraisal.

In the Real Estate Market?

KW1784102f20KW.jpgYou should consider using a realtor.  I could save you money especially with new home builders and it does not cost you anything.  So why not? Let me save you money!!!  If you are interested in buying real estate (new home, existing home, or commercial property), please contact me (Alan Lane with Keller Williams Realty a.t 2119 W Brandon Blvd, Brandon, Florida 33511).  As a life long resident of Central Florida, I can help you find the right property for you whether it is in Lakeland or as far south as Sarasota.  The Keller Williams offices of  ”Suburban Tampa” include the offices in Brandon, Plant City, Fishhawk Ranch, and our newest office in Valrico.  My email address is alanlane66@gmail.com, or call me at 813.205.9280.  If you are just starting your search, you can search the MLS for real estate opportunities on my website at this link

How Much Home Can You Afford?

cropped-img_41401.jpgAs a general rule, most future homeowners can afford to mortgage a property even if it costs between 2 and 2.5 times the gross of their income. Under this particular formula, a person that is earning $100,000 each year can afford a mortgage up to $250,000. However, a borrower should evaluate their finances and how much they are will to pay monthly when making the decision.  Knowing the mortgage size and approximately monthly payment that can be handled also helps the borrower narrow down the playing field so that precious time is not wasted in touring homes that are out of the price range.

Debt-To-Income Ratios and Down Payment

There are several ratios that lenders consider when determining how much money a person can borrow for a mortgage. It’s a good idea to know what factors lenders consider when determining how much mortgage that borrower can get.  There are three main factors, which are briefly described as follows:

  • The percentage of yearly gross income that is dedicated to making the mortgage each month is called the Front-end Ratio (mortgage payment, which are: interest, principal, insurance, and taxes). Generally these items should not exceed 28% of the borrower’s gross income, but some lenders allow the borrower to exceed 30% and some even allow 40%.
  • The debt-to-income ratio, which is also called the “Back-End Ratio” measures what percentage of income is required to cover debts (mortgage payment and such debts as child support, car payments, other loans, and credit cards). The debt-to-income ratio should not exceed 36% of the gross income. In some areas that have higher home prices, it is hard to stay within 36% with lenders allowing the debt-to-income ratio to go as high as 45%, which could increase the interest rate.
  • Most lenders require a down payment of around 20% of the price of the home. This minimizes the need for property mortgage insurance (PMI) requirements, which increases the mortgage payment.

The down payment also has an impact on the monthly mortgage payment and on the front-end and back-end of the loan. More expensive homes can be purchased with larger down payments.

Other Considerations

Just because you can afford a home based on these factors does not mean you should finance the maximum loan amount.  Here are a few questions to ask yourself:

  • What is your life style?  In other words, do you have an active life style that requires a lot of your resources (or money)?
  • How long are you going to stay in the home or if you are expected to increase your income can determine if a fixed or variable rate loan is appropriate.  A variable rate mortgage would start at a lower rate than a fixed rate mortgage.  The downside is the potential of increases in interest rates over time.

Pre-qualification Vs. Pre-approval

Ideally, a potential home buyer would talk to a lender to get either a pre-qualification or a pre-approval letter.  These are two different types of letters, which are defined as follows:

  • Pre-Qualification Letter are typically less intensive than a pre-approval letter and involves a brief conversation without document support.
  • Pre-Approval Letter is much more detailed and requires a  review loan requested documents (i.e. financial statements, credit reports, etc.) as well as proof of a down payment.

Conclusions

The Tampa Bay MSA area experienced large growth in residential housing during the residential “boom” period of the early to mid 2000’s. Since the beginning of 2013, the market has shown increases in both pricing and sales figures.  These figures continue to show improvement.  However, Hillsborough County is becoming more built out with less vacant land available for development.  Since most people will not buy homes with cash, I hope this helps you getting your new home with a mortgage and realize the dream of home ownership.

In the Real Estate Market?

KW1784102f20KW.jpgYou should consider using a realtor.  I could save you money especially with new home builders and it does not cost you anything.  So why not? Let me save you money!!!  If you are interested in buying real estate (new home, existing home, or commercial property), please contact me (Alan Lane with Keller Williams Realty a.t 2119 W Brandon Blvd, Brandon, Florida 33511).  As a life long resident of Central Florida, I can help you find the right property for you whether it is in Lakeland or as far south as Sarasota.  The Keller Williams offices of  ”Suburban Tampa” include the offices in Brandon, Plant City, Fishhawk Ranch, and our newest office in Valrico.  My email address is alanlane66@gmail.com, or call me at 813.205.9280.  If you are just starting your search, you can search the MLS for real estate opportunities on my website at this link

 

2017 Real Estate Market Update

National and Regional Single Family Market

According to NAR, existing single family homes sales have increased with projected annual sales of 5,810,000 units in November 2017 annually 2017 versus 5,600,000 units in November 2016.  Statistics in the South have increased slightly with annual sales in November 2017 of 2,340,000 versus 2,250,000 in November 2016.

Nat Existing Sales

As of November 2017, there was a 3.4 month supply of inventory available, which was down 9.7% from the previous year, nationwide.

National Sales Prices of Existing Homes

Meanwhile, the median nationwide existing single family home price was $248,000 in November 2017, which is up 5.8% from a year ago.  The median price in the South was $216,200, which was up 4.8% from the previous year.

The average nationwide existing single family home price was $289,900 in November 2017, reflecting a 4.8% increase from a year ago.  The average price in the South was up 3.1% from the previous year.

Florida Single Family Market

We relied on the data prepared by the Florida Association of Realtors (FAR) to provide an overall health of the Florida single family market.  This data is as follows:

As can be seen in the following charts, sales of single family homes at its height (in recent years) increased in 2015, compared with 2014 numbers.  Sales in Second Quarter 2017 were 79,888 compared to 71,723 in Second Quarter 2016.  This represents a 3.7% increase. Recently, sales of single family homes have decreased slightly to only 67,811, but remain higher than the First Quarter of 2017 and Forth Quarter of 2016.

STATE OF FLORIDA HISTORICAL CLOSED SALES FIGURES

Fl Closed Sales

Although there was a slight decrease in the number of sales, pricing has increased in Third Quarter of 2017, up 6.7% from the same time period in 2016.

STATE OF FLORIDA MEDIAN SALES PRICE FIGURES

FL Med Sales Price 2

Per FAR figures, the overall median sales price continues to increase.  However, the last two quarters have remained the same at $240,000.

Tampa Bay Single Family Market

The following data from the Tampa-St. Petersburg-Clearwater MSA (includes Hernando, Pasco, Pinellas and Hillsborough Counties) was prepared by the Florida Association of  Realtors (FAR).  As can be seen in the following charts, median sales price of single family homes have increased in 2016 over 2015 to a high in the Third Quarter of 2017.

TAMPA AREA CLOSED SALES FIGURES

Tampa Closed Sales 

As can be seen in the above exhibit, sales volume dipped slightly to 12,198 single family homes from the Second Quarter of 2017.

TAMPA AREA MEDIAN SALES PRICE FIGURES

Tampa Median Sales 2

Pricing of homes has stabilized with a median sales price in the Third Quarter of 2017 of $225,000, representing a 9.8% increase from Third Quarter of 2016.

CONCLUSION

The Tampa Bay MSA area experienced large growth in residential housing during the residential “boom” period of the early to mid 2000’s. Since the beginning of 2013, the market has shown increases in both pricing and sales figures.  These figures continue to show improvement.  However, Hillsborough County is becoming more built out with less vacant land available for development.

In the Real Estate Market?

KW1784102f20KW.jpgYou should consider using a realtor.  I could save you money especially with new home builders and it does not cost you anything.  So why not? Let me save you money!!!  If you are interested in buying real estate (new home, existing home, or commercial property), please contact me (Alan Lane with Keller Williams Realty a.t 2119 W Brandon Blvd, Brandon, Florida 33511).  As a life long resident of Central Florida, I can help you find the right property for you whether it is in Lakeland or as far south as Sarasota.  The Keller Williams offices of  ”Suburban Tampa” include the offices in Brandon, Plant City, Fishhawk Ranch, and our newest office in Valrico.  My email address is alanlane66@gmail.com, or call me at 813.205.9280.  If you are just starting your search, you can search the MLS for real estate opportunities on my website at this link

Its Time to Sell and Buy your Dream Home with Your Stock Market Returns.

Historical S&P 500 Return

money-7According to Scott Snider with www.mellenmoney.com,  approximately 10% is the average return for the S&P 500 since its inception back in 1928.  Adjusted for inflation the “real return” is more like 7%.  Also worth noting that nearly half of the gains from the S&P 500 resulted from dividends.

2017 S&P 500 Return

The 2017 S&P 500 Return: Buy, Hold and Reinvest

The above quoted numbers are accurate if you bought the index at the opening price on January 3rd, 2017 and sold at the closing price on December 29, 2017. If you’d prefer the numbers buying at the December 30, 2016 closing price the return would be +19.42% and +21.83%, respectively.

Here are the index price returns:

Price Return From
Open Close Gain
Jan 3, 2017 Start 2251.57 2673.61 18.74%
Dec 30, 2016 End 2238.83 2673.61 19.42%

Following are the dividend reinvested returns:

Dividend Reinvested Return From
Open Close Gain
Jan 3, 2017 Start 4303.12 5212.76 21.14%
Dec 30, 2016 End 4278.66 5212.76 21.83%

Whichever set of return time-spans you prefer, the message is the same “If you invest in funds or stocks that pay a dividend you’ll have to choose what to do with the payouts. Simply quoting price returns without regard to real returns in cash form doesn’t reveal the true impact of an investment.”  Either way, 2017 was a very good year for stocks with gains doubling histroical returns.

Source on the 2017 S&P 500 Return Calculations

These numbers come from S&P Dow Jones Indices, the owner of the S&P 500 Index. They have both the classic S&P 500 price index as well as the dividend reinvested numbers from 1987 forward.

2018 S&P 500 Return Projections

According to UBS, the S&P 500 could surge 18 percent this year, which raised its 2018 target to 3,150, the highest on Wall Street, only three trading days into the year.  The Dow Jones industrial average already crossed 25,000

The S&P 500’s gain on the year will be 17.8 percent according to the new UBS target and based on the benchmark’s closing value of 2017. Taking into account the rally to start 2018, the index will rise 15.5 percent from here, according to the UBS target. The firm’s previous 2018 forecast for the S&P 500 was 2,900.

“We assume solid growth,” said Keith Parker, the chief U.S. equity strategist at UBS, in an appearance on CNBC’s “Halftime Report.” “We do expect a large pickup in buybacks and M&A.”

What’s Next?

What are you goingto do with all that money?  If you want to find your dream home in the Tampa Bay area (Florida), you should contact Alan!!!  I can help you find it.  I love helping people find that dream home.  Additionally , yKW1784102f20KW.jpgou should consider using a realtor.  I could save you money especially with new home builders and it does not cost you anything.  So why not? Let me save you money!!!  If you are interested in buying real estate (new home, existing home, or commercial property), please contact me (Alan Lane with Keller Williams Realty a.t 2119 W Brandon Blvd, Brandon, Florida 33511).  As a life long resident of Central Florida, I can help you find the right property for you whether it is in Lakeland or as far south as Sarasota.  The Keller Williams offices of  ”Suburban Tampa” include the offices in Brandon, Plant City, Fishhawk Ranch, and our newest office in Valrico.  My email address is alanlane66@gmail.com, or call me at 813.205.9280.  If you are just starting your search, you can search the MLS for real estate opportunities on my website at this link

 

The Summit at Fern Hill in Riverview

Looking for a new home in Tampa Bay?  Why not consider a new Lennar Home?  When they say everything is included.  They mean it.  You don’t have to worry about blinds.  These homes are also very energy effincent.  There are four quick move in ready homes in the subdivision known as “The Summit at Riverview” in Riverview, Florida.  Here is some information about these homes:

SOURCE: Lennar Homes

There are two Four-bedroom/Two-Bath, 1,817 square foot, Harrisburg models ranging in price is offered at $216,890.

Harrisburg first flr

SOURCE: Lennar Homes

The Four-bedroom/Two-Bath, 1,936  square foot, Hartford model  is offered at $216,890.

HARTFORD fIREST fLOOR

SOURCE: Lennar Homes

The two-story, Four-bedroom/Flex/Two and One Half-Bath, 2,584  square foot, Providence  model is offered at $216,890.

SOURCE: Lennar Homes

In the Real Estate Market?

KW1784102f20KW.jpgYou should consider using a realtor.  I could save you money especially with new home builders and it does not cost you anything.  So why not? Let me save you money!!!  If you are interested in buying real estate (new home, existing home, or commercial property), please contact me (Alan Lane with Keller Williams Realty a.t 2119 W Brandon Blvd, Brandon, Florida 33511).  As a life long resident of Central Florida, I can help you find the right property for you whether it is in Lakeland or as far south as Sarasota.  The Keller Williams offices of  ”Suburban Tampa” include the offices in Brandon, Plant City, Fishhawk Ranch, and our newest office in Valrico.  My email address is alanlane66@gmail.com, or call me at 813.205.9280.  If you are just starting your search, you can search the MLS for real estate opportunities on my website at this link

 

Just Sold…Pool Home in Walden Lake

IMG_8526This 1,892 square foot, three-bedroom/two-bath pool home has a well laid out split floor plan home with a “L” shaped design that allows views of the crystal blue solar heated pool and large landscaped fenced backyard from the many sliding glass doors and windows in the living spaces including the master suite. Entering through the front double doors leads into a large living room with vaulted ceilings. Off to the right is the master suite with two walk-in closets, dual sinks, large soaking tub, and an enclosed shower. To the left of the entrance way looking out over the front lawn is the formal dining room which leads into the kitchen. The large family room can be entered from the front living room or the kitchen and has vaulted ceilings. The two bedrooms off the family room are sized nicely for the kids. The large second bath also leads out to the pool. The lanai looks out over a screened in pool and large fenced backyard. Wet areas are tiled with the bedrooms and living places having natural wood-looking vinyl planks, that were installed in 2016, which are a dream come true for pets, kids, and pools. Very easy access to Walden Lake Elementary and major thoroughfares like I-4.

In the Real Estate Market?

KW1784102f20KW.jpgYou should consider using a realtor.  I could save you money especially with new home builders and it does not cost you anything.  So why not? If you are interested in buying real estate (new home, existing home, or commercial property), please contact me (Alan Lane with Keller Williams Realty a.t 2119 W Brandon Blvd, Brandon, Florida 33511).  As a life long resident of Central Florida, I can help you find the right property for you whether it is in Lakeland or as far south as Sarasota.  The Keller Williams offices of  ”Suburban Tampa” include the offices in Brandon, Plant City, Fishhawk Ranch, and our newest office in Valrico.  My email address is alanlane66@gmail.com, or call me at 813.205.9280.  If you are just starting your search, you can search the MLS for real estate opportunities on my website at this link

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