Costs involved in Selling a Home

When you are ready to sell and talking with a REALTOR about listing the house, s/he should include the estimated cost involved in selling at the listing appointment. What I typically do is provide a breakdown at 3 or 4 different price points from projected sale price to worst case scenario. To date, my sellers have never been confronted with a worst case scenario net, but I believe it’s important to include that information up front since we should all work towards the best while being prepared for the worst.

Knowing these costs up front helps in preventing any surprises down the line. Real estate transactions are delicate matters. Scenarios can change from day to day based on inspection results, appraisal results, buyer financing, lender productivity and more. Eliminating surprises should be a priority for an experienced agent. Surprises in day to day life can be exciting and fun. Surprises in real estate transactions typically are not.

Educating a seller on the costs to sell up front is one of the steps I take to eliminate surprise. Imagine going through the process of selling and reviewing the settlement statement (HUD) 30-45 days after entering into a contract and learning you are walking away with less than you anticipated. That’s not a fun surprise by any means. That is why it is important to know these numbers at the time of listing.

Since I believe knowledge is power and in educating sellers and buyers, I am going to share these costs with you.

Cost to sell a home in Central Florida are as follows:

Real Estate Commission this is what you and your agent agree upon. The commission is typically shared evenly between the listing brokerage and the selling/buyer’s brokerage.

Documentary stamps on the deed. This seller cost is based on the sales price. It is calculated at 70 cents per one hundred dollars. Example: Sale price of $250,000 = $1750 in doc stamps on the deed. (250000 x .007)

Taxes are pro-rated. (If your taxes and insurance are escrowed into your mortgage, those escrows will be returned to you by your lender once the mortgage is paid (satisfied) – typically 45-60 days after closing.) In Florida, taxes are paid in arrears. Tax bills for the current year come due in November of that same year. At closing the taxes are pro-rated to reflect this; a seller will give the buyer a credit towards taxes for the number of days the seller had ownership in the house. Example – 2015 taxes total $1800. Property sells on May 1, 2015. Tax bill comes due on November 2015. Seller gives buyer a credit of $600 for January-April 2015. Buyer pays the entire tax bill when it comes due.

Owner Title Insurance and fees are also a cost in the transaction. In this region, the seller pays for and conveys clear title to the buyer. The cost of insurance is based on the sale price of the property. If a seller is selling a home that was owned for 3 years or less, a re-issuance credit may be available. The chart below shows title insurance fees without any credit being given.

Courtesy Metes & Bounds Title Co.
Courtesy Metes & Bounds Title Co.

Title fees vary from company to company and include costs for title search, lien search, recording fees, government fees and the settlement fee.  As a rule of thumb, I quote $725 for title fees.

Home Owner Association (HOA) dues is another item that is pro-rated. In order for the dues to be properly pro-rated, the title company must order an estoppel letter from the HOA. The estoppel letter shows what the seller has paid for HOA dues to date, any outstanding balance or fines, etc. HOA’s charge for this estoppel. These charges vary and generally run between $50-$500. I have seen them to be $150 on average.

And those are the standard costs of selling a home.

Simplified it is as follows:

$250,000 Sale Price
Commission                                                                       $X
Taxes $1800/yr (pro-rated: estimated closing 5/1/15)   $600
Doc stamps on deed (.70 per $100)                               $1750
Title Fees ($725) & Insurance ($1325)                           $2050
Cost to sell                                                             $4400 plus X***

***HOA estoppel fees (cost for payoff from HOA to title co.) generally run between $50-$500. I have seen them to be $150 on average. This cost has not been included in the cost to sell calculated above as the exact amount of the estoppel fee for your HOA is not known.

Calculating the cost to sell is not especially tricky. As I mentioned previously, any agent you interview should have these numbers available and should be providing these figures to you at the initial meeting. If s/he is not, then you are not getting the full picture. Hopefully, I have made these costs clear and easy to calculate. If you have any questions regarding the cost to sell, feel free to get in touch with me. I’d be glad to assist in any way I can.


Home Buyers: How to Win in a Multiple Offer Situation.

It’s a great time to buy real estate — really.  I know the real estate world was touting that line in their marketing campaigns a couple year back as prices were plummeting and tax credits were being offered to first time home buyers.  I didn’t really buy into it then.  I truly believe it is a great time to buy now.  I’m confident we have seen the bottom of the real estate market and are well into the beginning stage of recovery.

It’s ideal to buy as prices are going up, and with interest rates hanging in the 3s, now is a great time to grab a piece of the on fire

There are challenges in purchasing in today’s market.  With inventory low and demand high, multiple offers are common place – especially in the Orlando area market.  On top of that, cash is king and as of late nearly half of all real estate sales were cash deals

What does that mean for the average buyer, dependent on financing, and ready to buy?  It means be ready to act, swiftly and with precision.  It means stay positive and keep in mind that everything happens for a reason. It is possible for a first time buyer to beat out the hedge funds, investors and others with deep pockets.  It may take a little more time and the possibility of being out bid a couple of times before securing a home exist.  (This is where staying positive and knowing everything happens for a reason comes into play.  If the winning bid wasn’t yours, then there is a reason that house was not meant to be.  I am a strong believer in this and have seen this theory proven first hand time and again.)

I have had a number of buyers beat out cash offers – strong cash offers.  It is being done, and I am about to tell you how.

First and foremost, make your first offer your strongest offer.  Agents are not required to Lisa Jones Sale Pending Orlando-001disclose whether a property has multiple offers on it.  Don’t assume yours is the only offer, and don’t assume you will be given an opportunity to negotiate.  It’s quite possible you will not be given the chance.

Often times I have seen buyers disappointed that their offer was not the winning offer.  I have heard the phrases, “I should have gone up $5000” more times than I would like to count.  Honestly, $5000 in the grand scheme of things will not make a whole lot of difference in a mortgage payment (maybe $20- $30).  It could make the difference between an offer being accepted or rejected.  Knowing you gave your all should provide comfort if your bid is not the winning bid.  This was you know you gave your best and don’t keep yourself awake at night wondering “what if” or “would’ve should’ve could’ve.”

Strongest offers also include things like strong escrow.  Your good faith deposit needs to be attractive.  (1-2% of the purchase price is customary in the Orlando area market).  Putting $500 or $1000 down on a $100,000 purchase does not say “I am a serious buyer” to a seller.  Putting $3000-$5000 down speaks a little louder.  (Keep in mind this good faith deposit, your escrow, will be applied to your down payment and closing costs.  It is all going towards your cost to purchase anyway.)

Strongest offers also include things like reasonable closing times.  If the house is vacant, the seller will likely want to close as soon as possible.  If it is a short sale, you have a better chance of the offer being accepted if you agree to wait for short sale approval for an extended period of time, say 100-120 days instead of the customary 60-90.  If the house is occupied and it is a traditional sale, try to find out how much time the seller would like to close.  If you aren’t able but notice there is a lot of stuff in the house, giving 60 days to close 16019 arrowheadcould make the difference since the idea of packing up an entire household in 15-30 days could be a little nerve racking for a seller.  Not everyone likes the idea of a quick close.  Tailor your closing date accordingly.

Strongest offers also include few contingencies or short contingency time lines.  When writing an offer, the less you ask for, the more attractive your offer is.  Get inspections out of the way in 7-10 days.  Do not ask for a Home Warranty just because you can.  Do not ask for the seller to contribute to your closing costs if you don’t need the help.  If you do need the help, don’t ask for more than is necessary.   Keep it simple, keep it clean.

Another way for buyers needing financing to find success in today’s market is to seek out homes where owner-occupants have the first right to purchase.  Being able to cut a big chunk of the competition out of the game is definitely a plus.  Homes with First Look Initiatives and Neighborhood Stabilization Programs (NSP) give owner-occupants (not investors) the first right to purchase within a certain time frame – usually the first week or 2 the property is on the market.  Often times, these homes are in good shape and move in ready.  Granted there will likely still be competition; not nearly as much at there would be if investors were able to bid.

Lisa Jones Realtor at Keller Williams Sells HomesLastly, be prepared to pay a little more than market value.  I would never counsel a client to pay an outrageous amount over market value.  Sometimes the need arises to pay a couple/few thousand more than appraised value.  If you love the house and have the ability to do it, do it.  Often times paying a little more now is worth the time and expense of having to start all over again in the home search (including paying for home inspections and appraisal.)

Allow yourself some wiggle room as well.  If you are qualified up to $150,000, you may want to limit your search to properties up to $130,000 to start.  This could give you the cushion you need to have a little more offering power.

In conclusion, multiple offers can be challenging.  Patience is required.  Having the ability to act fast when the right home is found is crucial.   He who hesitates often times loses in this market.  Be ready to act.  Get qualified with a lender before you look at houses.  Know your budget, keep it in mind.  Do not stretch yourself beyond your limits but be prepared to stretch for the right house.

Visit to Trilogy in Groveland, Florida

I made the time to pay a formal visit to Trilogy a couple of days ago.  If you aren’t familiar with Trilogy, it is a gated and manned community for the active adult a/k/a 55 plus.  The community was conceived and started during the boom years.  At that time it was known as Cascades.  Unfortunately, the economy crashed and construction stopped abruptly.  I felt so bad for the few folks that purchased in the community and had none of the amenities or neighbors they were promised.  All I can say now is, those home owners that hung in there are now reaping the benefits of Shea Homes completing this neighborhood.

 I had been to Trilogy a few times in the past.  I had a shown a few resales and been to a Chamber event in the pool area.  This visit was different though.  I visited the sales center and was given a wonderful tour of the clubhouse by one of Trilogy’s sales reps, Diana Stone.

Trilogy boasts a 55,000 plus square foot club house, Magnolia House Members’ Club,  that is quite beautiful and substantial.  The décor is contemporary while holding onto classic ideals.  There is a gorgeous restaurant open for lunch and dinner on select days which boasts formally trained chefs who have worked in some of the most demanding kitchens.  There is also a private kitchen with room to entertain where residents can take cooking lessons with a trained chef or entertain others in a casual, comfortable atmosphere outside of their own home.

Trilogy also has an adorable arts and crafts room where adult can craft and create and bring the grand children to enjoy some of the fun, too.

There is a card room for poker and the like where drink service is provided.  In fact, cocktail service can be had in an area of the clubhouse – except the workout facilities of course.

 And the workout facilities are beautiful, top of the line and technologically pleasing as well.  (All the treadmills are wired for tv and internet).  Ladies that are not inclined to workout in the presence of the opposite sex can enjoy a separate exercise area off the ladies locker room that is Curves® inspired.

The locker room come equipped with everything you need including soap, shampoo, conditioner, etc.  You can even get a massage while you’re there, too (at very competitive rates.)

There is an indoor/outdoor heated pool which is a staple to any 55 plus community.  Trilogy’s clubhouse also includes tennis, bocce and pickle ball courts.

 Overall, the clubhouse and its offerings were amazing.  The more I saw, the more I kind of wished I was 55 or older – or neighborhoods like this were constructed for young to middle aged adults and families.  Wouldn’t that be wonderful (hint, hint Shea Homes).

 After touring the clubhouse I took a stroll through Shea’s models which start in the $180s.  They were all elegantly decorated and had really functional floor plans.  The kitchens were open, had ample (granite) counter space and cabinet space as well.  My favorite part of the kitchens were the gas stove.  (Jenn Air appliances are standard) Florida kitchens have been equipped with electric stove predominantly, but as more people from the North move in and more builders see the benefit and savings in using natural gas, we are seeing more gas stoves.  I love cooking with gas.  It took me forever to adjust to electric cooking, and I don’t think the adjustment has gone well.  Fortunately, my husband has been helping out with meals a little more lately.

Shea’s home are stunning and well thought out.  Master bedrooms are sizable but not so extreme where other rooms in the house suffer for it.  The bathrooms are tastefully designed and the master bathrooms all feature dual sinks, a tub and roomy shower space.

The best part about Shea homes and the Trilogy community is the energy efficiency.  Trilogy is the only community in the area that builds energy efficient homes with ZERO electric bills. Low flow fixtures, sealed duct systems, high performance insulation, dual pane Anderson windows, energy efficient lighting, low volatile organic compound (VOC) paint, eco friendly materials and solar powered system are all included in Shea’s homes in Trilogy.  Trilogy has embraced the use of energy efficient technology and the power of the sun (solar enegry).

 If you would like to schedule a tour of the community or would like information on any of the new homes or resales, please feel free to contact me.


Executive Vice President of Large & Influential Mortgage Holding Corporation says We Are Not Creating Another Housing Bubble. What Else Would You Expect Him to Say?

Rick Sharga, executive vice president with Carrington Mortgage Holdings, made the claim “we are not creating a bubble” during his keynote speech at the REOMAC 2013 Summit & Expo in Dallas on Monday.  (REOMAC stands for Real Estate Owned Managers Association of California).

Currently in the Orlando area, we are seeing a lack of inventory and a surplus of buyers.  Prices have been increasing steadily and bidding wars are all to common.  We are seeing a bubble in housing.  Is it as big as the Boom Bubble?  No.  Will the effects of this bubble burst be as hard felt as the Boom Bubble?  I doubt it.

I believe bank owned property holders and their affiliates as well as the federal government are contributing to this bubble.  Sellers with equity are as well, and to an extent I can’t blame any of the parties for doing it.

Sellers with equity are holding out to see where the market is heading.  Many “don’t have to sell” and can sit back and wait a little while to see where this market is going – with all assumptions that it will continue going up.  On a side note, I do caution these sellers that don’t have to sell but would really like to not to hold out too much longer.  One way or another, this mini boom will come to an end and the market will adjust accordingly.  Market On Fire

Bank owned property holders and their affiliates are contributing to and helping to create this bubble by keeping a stranglehold on inventory; releasing properties to the market at a trickle and pushing up prices.  I can attest to this as many others in our area can as well.

In just about any neighborhood in the Orlando area, you will find at least one home in a neighborhood that has been sitting vacant for a long time.  The house next door to mine has been owned by Bank of America since April 2010.  Bank of America has not made a single attempt to sell it in all that time.

This is fact around here, and it is kind of a shame when ready, willing and able buyers are out there putting strong bid after bid on homes only to be beat out by cash investors or stronger offers.  It is not accurate for Rick Sharga, executive vice president with Carrington Mortgage Holdings, to say that “we are not creating a bubble” when bank owned inventory (also known as REOs or foreclosure) is being trickled onto the market.

When one state out of 50 holds 16% of the distressed properties and there are 2.2 million units of shadow inventory lingering in our country, more needs to be done to resolve this matter.  Florida seems to be being used as a testing ground for what can and can’t be done by REO managers.  The small amount of bank owned inventory being released to the market is typically coming on 10-15% above current market value, and cash investors are pretty much paying it —- for now.

I can understand why the powers that be are doing it.  They do not want to flood the market like they did at the beginning of this mess and drive prices into the ground.  They want to help push prices up, and work their losses down.  But there is a happy medium somewhere.  It seems to me that big banks and corporations don’t understand the word moderation or believe in middle ground.

Banks are pushing this bubble – no matter how many times or how many ways they say they are not.

The Government is also contributing to this bubble by keeping interest rates low.  Chairman Ben Bernanke says he is going to keep rates low through 2014.

Do I understand why banks and the Fed are doing this?  Yes.  It makes sense.  Flooding the market and letting interest rates rise will not help us get through this.  Do I think the methods are a little extreme (and maybe even a bit greedy)?  Yes.  Give us a little more inventory to work with and work through.  Give more buyers, especially families dependent on financing, a chance.  I am for increasing values.  I would love for my home, and everyone else’s home, to be worth what it was in 2007.  Let’s get there a little more naturally though, and with a little more heart.  We have seen what artificially inflated prices has brought in the past.  Let’s not do that again any time soon.

How to Further Heal Florida’s Foreclosure Problem

Sarah ParrI was contacted by a blogger who wanted to post as a guest on my page.  After reading some of her work, I decided to give it a go.  Here is a guest post by Sarah Parr. Sarah Parr is a Central Florida-based writer who blogs about foreclosure issues in America.


How to Further Heal Florida’s Foreclosure Problem

Florida, with the nation’s highest foreclosure rate for the sixth consecutive month, still needs healing from the foreclosure crisis. Florida reported one foreclosure for every 282 housing units last month, according to data from RealtyTRAC. The statistics also show that one in 849 homes in the United States faced a type of foreclosure action last month, further proving that the reality of distressed homeowners still exists.

In order for the housing market to continue rebounding, it’s time lenders, courts and legislatures made more progress in handling foreclosures better and providing additional relief to homeowners.

Prevent dual-tracking with better communication

It can be difficult communicating with a mortgage company. Often, a company passes a borrower around to many different departments of the company, and the borrower speaks with many people about the same issue. Some homeowners report that they have faxed over the same document many times. Important paperwork can go missing, and instances of “dual-tracking” have been reported recently. Dual-tracking occurs when a homeowner receives a notice of foreclosure around the same time he or she is discussing a loan modification with the lender. Dual-tracking will be restricted in January 2014, but until then, it could continue occurring. A single point of contact for each borrower could potentially solve the problem of scattered communication and dual-tracking mistakes with banks and lenders.

Alleviate backlog of cases, with homeowners’ rights in mind

States that process foreclosure cases solely through the courts see some of the longest processing times for foreclosure-related documents. Florida foreclosure attorneys handle foreclosure documents that take nearly 29 months to process, compared with the nation’s average of 13 months. This forms a build-up of cases for courts and more anxiety for homeowners. States that process cases through administrative processes in addition to judicial-foreclosures see shorter processing times for foreclosure-related documents. Currently, a handful of legislation is floating around in Florida’s legislature with the intention of curing the build-up of foreclosure cases.

Protect homeowners with bill of rights

Certain states, such as California, have passed several bill of rights measures to protect homeowners and further regulate the mortgage and housing relief industries. The law prohibits a few practices coupled with predatory lending: dual tracking and “robo-signing,” a term describing the robotic signing and production of fraudulent mortgage documents. California’s law also mandates that lenders provide a single person of contact for the borrower, and gives the borrower the power to sue for violations of the laws. California has seen a decrease in foreclosure activity since its law went into effect early this year.

Based on the ideas proposed by many different people, Florida will likely see changes in its foreclosure process soon.


Got Equity? Think Twice about Using It.

Rumor has it that since more people are living in homes with equity that more homeowners are going to feel more confident about the economy and take out home equity loans.  I caution those considering doing this to think twice.  Think back about 7 or so years ago to when the housing market was booming.  When many couldn’t see an end to rising home prices in sight.  When many took out home equity lines and second mortgages for purchases like new cars, new boats, lavish vacations, investment properties and the like.  We all know what happened after that.  In fact, most of us are still feeling it.

Are all home equity lines bad?  No.  Not if you want to remodel your kitchen, update your bathroom or upgrade your flooring.  Projects like this should give a return on the investment – not 100% though.  If you are planning a home renovation, do it because you want to.  Do it because you will get pleasure out of it and enjoy it.  Don’t do it for the dollar signs….no home improvement project that I know of will give 100% return on the investment.

So please, I beg you, if you are considering taking out a home equity line of credit or a second mortgage now that your property is in the black again, please think twice.  We saw what happened a few years back when everyone was spend happy and not considering the what ifs.  Choose wisely, spend smartly, and ask yourself at least 3 times, Do I really NEED to do this?



Forget Renting — It’s Cheaper to Buy, and you don’t have to have golden credit to do it.

ImageIt is still cheaper to own than rent in most of our markets right now.  According to Trulia, it is 51% cheaper to own than rent in the Orlando marketplace.  

Keep in mind, with an FHA mortgage buyers can purchase with as little as 3.5% down.  A 640 minimum credit score required…and folks that were foreclosed on may qualify to purchase FHA in as little as 2 years after the foreclosure date.

Sale prices are on the rise, and demand is steady….Although people can speculate and forecast all they want, there is no real knowing how long this will all last.  Been on the fence?  It truly is time to jump off and buy.  Like they say, get while the getting is good. 




Financial Reporting & Forecasting Firm Kiplinger says Housing Recovery is “firmly” Underway

The market sure is rebounding. We have seen steady and consistent growth in our Orlando marketplace for about 2 years now.  In the article, Kiplinger states “the turnaround will probably be slower in metro areas in Florida….”  I’m not quite sure the folks at Kiplinger hit the mark with that comment.  I first noticed the inventory beginning to dwindle in the Summer of 2011.  Since then prices have been increasing steadily and demand has grown exponentially.  Real estate is local.  In fact real estate is hyper local; so much so that improvement in values in the Orlando market varies from city to city – even neighborhood to neighborhood.  Because of this we have seen values improve at rates between 3-11% over last year (Again, depending on the area/marketplace.)

I do agree with the statement by Karen Mracek, a Kiplinger editor and real estate analyst, that “the rise in home values and decline in inventories won’t maintain their current pace.”  We are riding one of the waves of recovery (I am sure there will be several).  Sooner or later the currents will dwindle and we will find normalcy – which in our market is a growth rate of about 3% per year (pretty healthy.)

Read the full article here:

Kiplinger: Housing Recovery Firmly Underway