The ABCs of CDDs

Many of you have probably heard about CDDs—Community Development Districts—but may not understand exactly what they are. CDDs are boards that levy fees on homeowners in certain developments in order to build amenities such as pools, golf courses, club houses, etc, without having to raise the local tax rate. They are also used to construct roads and lay in utility lines that serve the homeowners who pay the CDD fees.

The good news about CDDs is that homeowners pay a certain amount every year, rather than being assessed for the entire fee up front. CDD fees are also tax deductible for the property owner, as opposed to HOA fees, which are not. They also enable builders to create upscale communities that wouldn’t be possible without the CDD fees, according to Florida state legislator Ken Littlefield.

However, Littlefield notes that buyers often don’t know the risks and aren’t told about all the things that can happen, such as fees going up or paying for amenities that don’t directly benefit the homeowners. Currently, Florida law only requires a sales contract to include a disclaimer stating that CDDs may be imposed on the property. Homeowners are often surprised to learn that the CDD fees may increase at the developer’s discretion, with no recourse available to them. This is because CDD boards are initially comprised of the developer’s associates and are not required to have any homeowner representation for up to the first six years of their existence.

My advice: if you’re purchasing a home in a self-contained community, be sure to ask your real estate agent, or the developer, if there is a CDD clause in the contract. As I stated earlier, CDDs have been the driving force behind many of the fabulous upscale communities that have been built in our area recently. But, as a homeowner, make sure that you are informed about any possible future financial effects of a CDD.

Is the Housing Crisis Over?

I won’t jump the gun and say that all is well but, according to an article in the Wall Street Journal, housing prices have been slowly, if steadily, declining since 2006. The author, Cyril Moulle-Berteaux, notes that in 2005 and 2006, the average home mortgage required 25% of a buyer’s monthly income. For first-time buyers, the numbers were more intimidating, with homes often commandeering up to 37% of the household income. Ouch!

Over the past two years, as more people have been unable to purchase or maintain their current homes, housing prices have fallen 10% - 15%, while income is steadily growing. Home prices now are on par with where they were in the 1990s and, consequently, more people are able to afford to buy. This is especially helpful to first time homebuyers.

Will this decline in housing prices lead to a dramatic drop in home value for people who already own homes? Not to worry, according to Mr. Moulle-Berteaux. As inventories of unsold homes decrease (due to increased affordability and people buying them), the market will start to swing upward again. This is a pattern that has occurred consistently in the U.S. housing market and there is no reason to expect that this time will be different. We can, however, hope that the growth will be slow and steady, and avoid the fireworks that led to drastic price increases, speculative loans and a rash of foreclosures.

If you’d like to see what is available in the Jacksonville area in your price range, give me a call.

Gina

Florida Home Sales on the Rise

If you’ve been waiting to sell your Jacksonville area home, here’s some good news on the real estate front. The Florida Association of REALTORS reported that existing home sales were up 10% from February to March of this year. That increase, along with Jacksonville’s ranking as #26 in the Forbes 100 Best Cities for Jobs in 2008, makes this a good time to put your house on the market.

The decision to sell your home is a complicated one that requires a lot of preparation and decision-making. As a long-time real estate agent in Jacksonville, I have many years of experience helping families price, market and showcase their homes. I have the marketing expertise and the know-how to make your home sell in the shortest possible time for the best possible price.

So, if you’re ready to sell, call me. Together we’ll take advantage of improving market conditions in the Jacksonville area to ensure the best possible home sale experience possible.

Gina

Jacksonville Real Estate Market Looking Good

Because Jacksonville and northeast Florida never went through the crazy real estate speculation boom that affected other U.S. regions, things are looking up for property owners in our area. In fact, Jacksonville was named number 8 in a list of Ten Best Cities for Bargain House Hunters compiled by Forbes magazine.

A recent report by the Florida Office of Economic and Demographic research estimates that real estate value in Duval County will climb by 3% in 2008, making it one of only two counties in the state (the other is Leon) that will sustain an increase in the housing market. More good news for Jacksonville house hunters—the city ranked 19th out of 100 markets in private sector job growth. Add to this the fact that Jacksonville’s inflation rate was below the nation’s average and we can consider ourselves fortunate to live in this lovely and stable community. (Plus, there’s that fabulous weather).

If you’ve been waiting to look for a home, now would be a great time to start looking. Ditto if you’ve been thinking of moving up or downsizing. In my many years as a real estate agent in Jacksonville, I can honestly say that there has never been a better time to buy…or sell. Let me help you turn your real estate dreams into reality.

Gina