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Pensacola Real Estate – Tax Credit Information

It takes time to find the right Pensacola home for sale that suits your needs. Finding and getting real estate under contract rarely happens quickly. There are currently over 4500 Pensacola homes and condos for sale. If you want to take advantage of the tax credit, you need to move quickly. There are only 54 days left (from March 6, 2010) to get a home under contract by April 30, 2010. Next, the home must be closed by June 30. This is not a lot of time.

If you decide to purchase a Short Sale property, the chances of getting it under contract before the deadline are very slim. (See article Short Sales – Are They Worth It). However, there are many affordable conventional sales available, and quite a few bank owned properties on the market.

Here are some links to help you understand more about the homebuyer tax
credit and take advantage of it:

IRS First-Time Homebuyer Credit Q & A
 

IRS Form 5405 (to take the tax credit)

Frequently asked questions about the $8,000 first-time home buyer tax
credit

Frequently asked questions about the $6,500 tax credit for repeat home buyers

Some key points for prospective home buyers

Pensacola Military: Since we have such a high military presence in
Pensacola (thank goodness, what would we do without you great men and
women), the link below is very important to members of the military who
are looking for Pensacola Homes For Sale before the tax credit deadline.

Special rules that apply to members of the military, the foreign service and the intelligence community

Posted by Karl Burger | Currently No Comments »

Buy Now Or Pay More Later – Pensacola Real Estate Mortgage Rates Are Rising

The price of food and gas is not the only thing that is rising. Mortgage rates are rising too. If you are looking to buy a new home, I recommend starting the process sooner than later. A down real estate market and low interest rates create the perfect opportunity for getting great deals on real estate. But waiting around for the “right time to buy” will end up costing you money in the long run. Now is the right time. Read on to find out why.

Here are just a few quotes from various news sources published in the past few days:

Mortgage Rates Rise Again – Fixed rate mortgages have reached their highest rates in over 10 months, according to bankrate.com.

Mortgage Rates At Highest Level In 9 Months 

Mortgage Rates May Go Over 7 Percent This Year  

Brian Brady is an excellent blogger whose blog I read regularly. Here is his most recent Mortgage Rates Report .  

Brian believes that rates will come back down within 3 years, but could rise up to 2% before then. However, I believe that within 3 years the Pensacola real estate market will be well into another upward cycle. This means you will be paying considerably more for a home in 3 years compared to what you would be paying for that home today.

How Much Can Rising Real Estate Mortgage Rates Cost You?  

The table below illustrates the cost of a 30-year mortgage at varying interest rates. The numbers are based on the mortgage being kept for the full term of 30 years.
Pensacola Real Estate Interest Rates 

Assuming the interest rate is 6.5% today, look how much the monthly payment goes up with each 1% rise in interest rates. It is over $100 per month for a $150,000 mortgage and over $130 per month for a $200,000 loan. These figures only include Principle and Interest, not insurance or taxes. If you were to live in the home for 30 years, the “Cost Over Today’s Rate” column shows how much more you will pay over the life of the loan at higher interest rates.

Does buying a home now make sense?  

Absolutely, assuming you can afford the home you want. Every real estate agent knows that we are close to the bottom of the real estate market in Pensacola, and interest rates will rise, at least for the next several years. If you can’t afford the home you want, buy a less expensive home and use that to build equity and move up to a nicer home in the years to come.

Shop Carefully For The Real Bargains 

I am not recommending just buying any home. There are a lot of homes on the market and some of them are super deals. Others are grossly overpriced. This is where a good real estate agent can help. A good agent can help you analyze the value of various homes on the market that you may be interested in purchasing and help you find motivated sellers who are willing to sell at bargain prices.

If you are ready to buy, please feel free to Contact Me for assistance. I can help you make sure that you get the most for your money.

Click on Pensacola Real Estate News for a list of articles indexed by category. 

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Make Sure Your Home Warranty Is There When You Need It (Follow-up)

A few weeks back I wrote an article on Pensacola Real Estate News about how you should protect your investment in a home warranty by making sure that all warranted items were in working condition when you moved into your home. I noted that the home warranty company would try to find a way out of paying for repairs if at all possible. The article was written based on the experiences of one of my clients. You can read that article by clicking on this link: Pensacola Real Estate News – Home Warranty Article

The fact that I am writing a follow-up article tells you that I’ve learned something since that previous article was published. I also learned that I have readers out there who are sharing feedback with me, and I greatly appreciate that. Man_cookingJust the fact that I have readers really excites me.

The day after publishing that article, a manager from the local branch of Old Republic Home Warranty company called me. He thanked me for the great article and was very complimentary (Thank you Stewart). He also told me that my article was accurate up until mid-December 2007. He said that in December Old Republic modified their agreement to cover unknown pre-existing conditions. I took a look at the new home warranty agreement and found the following wording:

Coverage may apply to a malfunction which existed on the effective date of the Plan if, at that time, the malfunction was unknown, and would not have been detectable to seller, buyer or agent by visual inspection and simple mechanical test. This Plan does not cover known defects.

I will let my readers decide how they feel about this wording. I believe it does indicate that they would cover an unknown pre-existing condition, but I do not like the word “may”. I prefer the word “will”, as in “coverage WILL apply”.

I do appreciate the call from the home warranty manager, and I fully believe he is sincere in his promise that they will cover pre-existing unknown problems. I do, however, still suggest that home buyers follow my advice given in the previous article. Check out all warranted equipment when you move in to your new home.

As for my client, well I’m afraid he was a male who doesn’t do much cooking and wasn’t clear on how to operate his warranted oven. After he was told by the sweet home warranty operator that his problem was not covered because he did not know if it worked when he moved in, he took another shot at it and found that the oven worked fine once he turned the correct knobs in the correct order. Now this guy in the picture is not my client, thank goodness. While he appears to know how to operate the stove, he kind of creeps me out with that sinister grin. I have to wonder what he is cooking.

Aside from the creepy dude,  all is well with my client, and his lack of oven experience happened to make for a great article. However, he purchased his home warranty in February of 2008, after the new policy was in place. Thus the new “unknown pre-existing” clause should have been in effect. Was the home warranty operator unaware of the change in the contract? Or was she aware of the change, and still trying to avoid paying a claim?  Good question.

I must end this article by saying that I have other clients who had warranties through Old Republic and were extremely satisfied with the service they received on warranted equipment. I am not trying to criticize any warranty company’s service, only trying to show home buyers how to protect themselves against the unknown.

Click on Pensacola Real Estate News for a list of articles indexed by category.

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Make Sure Your Home Warranty Is There When You Need It, Money Saving Advice From Pensacola Real Estate News

When buying or selling real estate, home warranty plans are often included as an incentive from the seller to the buyer,  or sometimes as a negotiation tool. I recommend all of my home buyers get a home warranty, even if the seller is not offering a home warranty and the buyer has to pay for it. In this buyer’s real estate market, motivated sellers should offer a home warranty. Customer_Service_Rep_RS380

However, this article is not about getting a home warranty. This article is about how to protect your investment in a home warranty once you have it. Remember, the home warranty provider does not make money by fixing your problems. The home warranty provider wants to find a way to get out of fixing your problems, and thus keeping their money.  Please take this advice to heart. It could save you a lot of frustration and money.

This article is based on an experience of a buyer who was my client. The behaviors described in this article may not be true for all home warranty companies. But the advice given is important, no matter who issues your home warranty.

TYPICAL SCENARIO

Let’s say that you purchased a home, along with a home warranty plan. You are feeling good knowing that if you have problems with warranted items, you pay a small service fee and the home warranty company will cover the rest. You had your home inspected prior to closing and the inspector told you that everything was in working condition.

Let’s say that you close on your home in July, a very hot time of year in Pensacola.  Why would you think of running your heater in July?

Now November comes, and a blast of cold air comes down from the north. It is time to get some heat on. But to your dismay, the heater does not seem to be blowing any hot air. After checking what little you actually know how to check, and getting advice from your friends who don’t know any more about heating and A/C units than you do, you decide it is time to call the warranty company.

Important: Don’t bother calling your real estate agent. He or she likely knows very little about heating systems, and that is why he or she recommended you get a home warranty.

MAKING THE CALL – BE ON YOUR GUARD

You dig up your paperwork from the real estate closing, and give the warranty company a call. A very sweet customer service representative from the warranty company answers. She talks to you like a friend, sharing how terrible she feels that you may have to endure a few cold nights in your home while you wait for service. After several minutes of basic question and answer conversation, you are feeling very good about the whole situation. This warranty company really cares about you. You can just hear it in her voice. She is like a genuine friend.

And then the warranty company representative asks if you have tried the heater since you moved in to your new home. Your guard is down, you are at ease with your friend on the other end of the phone, and you answer “Well, no. We bought the home in July and it was very hot. But we had a home inspection and the inspector ensured us that the heater worked when the home was inspected”.

Then the warm and friendly answer on the other end comes. “We’re sorry, but since you have told us that you did not know if your heater worked when you purchased the home, we are not obligated to cover it under your warranty plan. You did not actually own the home when the inspector tested the heating system”.

OUCH!!! Even though the weather has gotten cold, you are now feeling pretty hot. But don’t lose your cool, as you can be sure the call is being recorded “to ensure quality service”.

Home_warranty_ProviderDon’t let this happen to you. When you move into your new home, test every item that is covered under the home warranty. If it is the middle of winter, test your air conditioning. If it is the middle of summer, test your heater. Test all of the burners on your stove, even if you never cook. Test all the features of your oven and your dishwasher. If the seller left you a freezer in the garage that you really don’t need right now, test it anyway.

Now if you have a problem in the future, you can call your home warranty company and say “YES, I know it worked when I moved in because I used it”. It is as simple as that. You keep your warranty in force.

BUT what if you move in and test your heater, or your stove, or your A/C, and find that it doesn’t work? You have no way of proving that it worked at the time you purchased your home warranty, which was at the closing table. What are you going to tell the warranty company when they ask you if you have tried it since you moved in and verified that it worked? I just wrote this article to explain how to protect your home warranty, not to answer moral dilemmas. Hopefully you will never have to decide how you would answer your friendly home warranty operator in this situation.

After publishing this article, a local home warranty company contacted me with updated information. You can read about it in my follow-up article on home warranties.

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Cheap Waterfront Real Estate In Pensacola Florida

“Cheap Waterfront” are two words that have not been used in to describe waterfront real estate in Northwest Florida for a very long  time. However, we may now be seeing our beautiful bayfront and intracoastal waterfront homes and lots fall to prices not seen since the late 1990’s.

Below you can see one of the best waterfront lot values on Perdido Key, 100 feet of waterfront on a .30 acre lot for under $325,000.

Jims_325K

From Navarre to Perdido Key, prices continue to respond to the downward pressure on the market caused by the slow but certain deflation of the real estate bubble, the sagging national economy, and the abysmal state of the local economy. Most of the properties have been completely repaired, restored and updated to better than ever condition,  with their owners expecting to be able to recoup the investments by relying on the traditional high resale value of waterfront. However, these property owners have not seen the appreciation they hoped for, with many canal, bay, and sound front  homes  languishing on the market for months. It seems the time has come for a certain percentage of owners to cut their losses and negotiate prices that they never dreamed they would sell their little pieces of paradise for.

This beautiful 2 story waterfront home below on Santa Rosa Sound is one of 2 homes for sale on the same lot. With both the homes, you can get a total of 6 bedrooms and 4 baths for under $600,000.  That is only $300,000 asking price for each home. You could live in one home and rent the other out, or have family living close together on pristine Santa Rosa waterfront. Or, for people who love to entertain out of town family or guests, the 2nd home could be used as an exclusive luxurious guest house. How impressive would that be???!!! If you are interested in this beautiful waterfront property, call me to see it, at 850-512-2587

BB_RE_600K

It is becoming common to find 2000+ square foot homes on 50-100 ft lots for less than $500,000, and waterfront lots, some with panoramic views of pristine barrier islands, beautiful sunsets, and deep water access for $300,000 or less. It is becoming more and more common for older homes to be torn down and replaced with state of the art hurricane hardened homes.

GB_640K

The question on everyone’s mind has now become “how low can it go”. We must surely be approaching a price level for these types of properties that compares favorably with the entire nation, especially given the natural beauty of the area. The only reason some of these properties have not sold may be that the areas they are in have been well kept secrets, hidden away from the main east to west highway 98 corridor by the big, moss covered oaks that cover the peninsula of land that forms the Gulf Breeze and west Navarre communities.

Grand_Lagoon_350K

It is certain that within the next several months these properties will become too much of a value to resist, and will be snapped up by people who had dreamed of living on the water all their lives but never thought they could afford it. Additionally, foreign investors are now taking advantage of the falling dollar and searching out these hidden gems for future returns.

For more information on great deals on Pensacola waterfront properties, Contact Me and let me show you all the  great deals on Pensacola waterfront homes and land.

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