Buyers from Canada make Florida their second home

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Recent reports note that Canadian investors account for the biggest group of buyers of Florida homes. Figures from Florida realtors show that 31.6 percent of all international transactions in the state were made by Canadians, and this specific demographic spent more than $2 billion on properties. The second biggest group of international buyers originated from the United Kingdom, and these investors account for only 7 percent of all the purchase.

Image Source: investinedmonton.com

The lure of Florida to international buyers may be in its relatively inexpensive market rates. And Canadians seem to be banking on forecasted positive real estate growth in the nation. These investors purchase rural tracks of land at significantly discounted rates and see their property increase in value after a few years. The technique seems to be paying off even among investors who buy homes instead of land. Most Canadian investors come to the Florida for a vacation, and after seeing how affordable homes are in the state, decide to invest. And financial analysts laud the amount of patience these international buyers have. Compared to the typical local investor, Canadians seem to be more willing to wait out their return on investment. And this holds true despite local economic fluctuations. These characteristics, combined with Florida’s reputation for being a laid-back community and an ideal place for those who wish to retire, make the trend more understandable. Still, some industry observers express their hesitations in having a single country dominate such a huge percentage of the international real estate buying market. 


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Financial advice on real estate transactions is the specialty of Clarence Butt of CTV Capital. For more information on the latest real estate news, follow this Facebook page.

REPOST: Report: DC Beats NYC in ‘Walkable Urban Spaces’

Tobias Salinger of Commercial Observer reports the results of the recent study made by the George Washington University School of Business regarding the ranks of walkable urban areas in the United States.

The report’s cover. (George Washington University School of Business) | Image Source: commercialobserver.com

 Pedestrian-friendly suburbs surrounding the nation’s capital have given Washington, DC an advantage over New York City that should prove instructive to the Big Apple’s real estate industry professionals, according to a new study released in June by researchers atGeorge Washington University School of Business called “Foot Traffic Ahead.”

While New York City boasts the most areas defined by a formula measuring what the report refers to as “regionally-significant, walkable urban places” with more than 1.4 million square feet of office space, over 340,000 square feet of retail space and high marks for the neighborhood’s use by walkers, a larger percentage of DC’s office and retail space rises up in so-called “WalkUPs,” offering developers in the area the opportunity to command higher relative rents outside the city’s center, said the head of the GWU Center for Real Estate and Urban Analysis, former real estate developer Christopher Leinberger.

“New York is at one extreme; Washington is at the other extreme,” said Mr. Leinberger, one of the report’s authors, about data finding much more of DC’s walkable urban areas in the suburbs than that of New York City. “I believe the future, based on my research throughout the country, belongs to the urbanization of the suburbs.”

So, while New York City enjoys 66 of the walkable spaces–the most of any of the country’s 30 largest cities and nine more than the nearest competitor, San Francisco–all but 11 percent of the pedestrian-friendly areas show up within the city’s limits, particularly in Manhattan, which makes up only 0.3 percent of the region’s landmass, according to the report’s findings. DC, on the other hand, has 51 percent of its urban walkable spaces in its suburbs.

The report's rankings. (George Washington University School of Business) Image Source: commercialobserver.com

Though no other city’s pedestrian areas provide the 206 percent rent premium over driving suburbs that’s evident in New York City, the area’s real estate industry could ramp up profits by boosting development in the Long Island and New Jersey ‘burbs, Mr. Leinberger said.

“It’s a great opportunity that you’re missing that’s hurting your economic development significantly,” he said. “You’ve got to offer the market what it wants, and that’s the urbanization of the suburbs.”

But New York City’s broad swaths of urban space do place it far ahead of less-populated, suburban-sprawled locales at the bottom of the list. By finding a correlation between the so-called “WalkUPs” and both gross domestic product and educational attainment, the report also shows how the city’s urban spaces relate to its economic health.

“New York is by far the largest walkable city in the world,” said Josh Kuriloff, executive vice chairman of Cushman & Wakefield, in a prepared statement. “The highly educated millennial generation is attracted to environments that have a diverse culture, a 24-hour community, a city with museums, theatre and music. Parks and green space are abundant in this great city.”


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REPOST: Three Customer Service Tips for Real Estate Agents

 This article from Muncievoice.com talks about  different ways to improve customer service for real estate agents.

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MUNCIE, Indiana – For you real estate agents, you know the housing market is recovering, but are you getting the amount of clients you want. What can you do to get noticed? What brings in clients? It may be that your customer service needs some extra attention. Try these three tips to bring people into your office.

Change Your Fees

Even though it seems that home sales may be on the rise, as has been the trend for the past few years, the fees that real estate agents charge can be ludicrous. We all know that every working individual needs to make money, but let’s get serious—$20,000 looks like a heart attack on paper… unless it’s justified.

If you sell big homes, then you obviously will lean toward bigger fees. And that’s fine. Make sure there’s a reason that your buyers are paying you what some folks make in a year. Itemize your fees on paper and in person, suggests Bacal & Associates. If the buyer has amazing credit or is willing to drop more of a down payment than is expected, go ahead and give them a break on one part of your fee. You also may want to lower your fees overall. By giving everyone a break, your buyers will share this information with other potential buyers.

Establish a Social Media Presence

Make your social media presence large. Use all the available platforms to their fullest extent. Post blog entries including useful facts about the real estate market. Don’t just regurgitate facts. Tailor them to the current season, recent condo trends, whatever. Check out photo-based sites like Pinterest for Real Estate to share pictures of your properties. Whatever networks you use, get your name out there and get people talking about you. And if you’ve only dabbled in social media, get comprehensive get-started guidance at Mashable.

Use a Cloud Contact Center

According to the Census Bureau, almost 36 million Americans moved between 2012 and 2013. The in-state movers are likely to make all contact in person at your agency’s brick and mortar location. However, out-of-state movers will likely make initial contact via phone or email. Depending on how much energy you put into your social media campaign, you may have a large batch of new buyers heading your way and managing these new contacts can be rather tricky and time-consuming.

Fortunately, there are solutions. The folks over at Zipwire and other cloud centers have created a management system for your client pool that allows you to stay in constant contact with your buyers. Have someone interested in your listing in Scottsdale, Arizona, and they live in Michigan? It might be a good idea to share a picture or some live camera footage with them via the cloud system. With all of your clients in this contact cloud, you can provide the ultimate customer service.

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Demand for walkable urban places skyrockets

Image Source: bettercities.net

In the 1970s, people were buying and renting in the suburbs. Millenials today are eschewing the subdivisions where their parents grew up in favor of WalkUPs.

"WalkUPs" is short for "walkable urban places." In the past, people who lived in the suburbs had to drive to the city or town center in order to work, go to school, or shop. In contrast, WalkUPs have residential areas, workplaces, retail centers, shops, community centers, and restaurants grouped closely and within walking distance of each other.

Image Source: bettercities.net

In a report from the Center for Real Estate and Urban Analysis at the George Washington University School of Business, researchers ranked cities according to their "walkability," with Washington, D.C., New York, and Boston at the top of the list. According to the researchers, WalkUp development might dominate the real estate industry in more cities in the future. Research shows that walkability is a driving factor in residential real estate purchase by young buyers.

The report also cites some impressive figures: rent per square foot in walkable urban places is 74 percent higher than that in traditional suburban areas. According to the report's researchers, Miami, Denver, Detroit, Atlanta, and Los Angeles are poised to become future centers of walkable real estate development.

The rise of property prices is due to simple economics: there's a lot of unmet demand from millenials and others seeking to take advantage of the conveniences of living and working in a WalkUP. Strategic development of walkable urban places might be a good solution, as experts believe that WalkUPs are fast replacing traditional car-dependent suburban areas as the most desired places to live, work, and play in.  

Image Source: cooltownstudios.com

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REPOST: Brookfield Financial bets on U.S. real estate

This Finance & Commerce article discusses the growing interest of foreign investors on US real estate.

Investors are showing increased interest in U.S. real estate, especially in areas like New York’s trendy Meatpacking District (pictured). According to Brookfield Financial Corp., three buildings in the district sold recently to a U.S. investor for $105 million. (Bloomberg News file photo) | Image Source: finance-commerce.com

Brookfield Financial Corp. received 179 expressions of interest for a property sale it advised on in New York’s trendy Meatpacking District this year. More than half were from abroad, said President Brydon Cruise.

Interest in the three-building storefront and apartment complex is just one sign of the insatiable foreign demand for U.S. office and retail property as the country rebounds from the financial crisis, according to Cruise, head of the Toronto-based investment-banking unit of Brookfield Asset Management Inc. “In the U.S., people were terrified for years — that’s changed,” Cruise, 49, said in an interview at Bloomberg’s Toronto office last week. “Now there’s a massive amount of foreign interest in the U.S. and we’re trying to grab it. The recovery’s real.” Brookfield Financial, which advises buyers and sellers of so-called real assets including energy grids, commercial and residential towers, and highways, is aiming to double its revenue for 2014 over last year to C$100 million ($92 million). The firm, which counts Royal Bank of Canada and Eastdil Secured LLC, a Wells Fargo & Co. subsidiary, among its competitors, plans to capture foreign investors piling into large U.S. cities as the currency and investor comfort strengthens.

Cruise relocated to New York from Toronto last month and announced the appointment of Dan McNulty, former president of Rockwood Real Estate Advisors LLC, as partner in the city last week. Brookfield Financial also opened an office in Houston last month and is considering opening offices in South Korea and Dubai. With 160 employees, the company is expanding and looking to open more offices in the U.S. and the other seven countries it operates in — Canada, Brazil, Australia, India, Germany, and Hong Kong.

Rents rising

New investment in offices in major U.S. cities last year rose to $52.2 billion, 29 percent more than the prior year, and the most since 2007 when commercial properties netted $107.8 billion, according to data compiled by New York-based industry researcher Real Capital Analytics Inc. New investment in commercial real estate, including apartment buildings, office properties and strip malls, has more than quadrupled in value since 2009, the data show. The figures are based on reports of properties and portfolios valued at $2.5 million and above. The buildings in the Meatpacking District, where Google Inc. has its largest global sales office, sold to a U.S. investor for $105 million, Cruise said. He declined to name the company that won the bid, citing confidentiality.

Mobile capital

Driving the recovery is a global search for returns as bond yields slide anew, said Cruise. About $15 trillion in institutional money globally will move from bonds and equities into real assets, including office buildings and infrastructure, by 2020, according to Brookfield data. A strengthening greenback has also been a draw. The U.S. currency has gained 11.5 percent this year against a basket of 10 global currencies that Bloomberg tracks.

“There’s more money than assets,” Cruise said. “Everything I’ve known for 26 years from a value perspective has completely changed.” Real estate and infrastructure is “well valued” in so-called gateway cities, he said, such as New York, London, and Hong Kong. “It’s crazy — you can’t get into those markets.”

Symbiotic relationship

Brookfield Financial and Brookfield Asset Management, which oversees $175 billion in assets, benefit from operating under one umbrella, said Mark Rothschild, an analyst at Canaccord Genuity Corp.

“BAM does a lot of deals so having the expertise inside the company to analyze different deals and understand the market is of value,” he said from Toronto. Brookfield Asset Management has returned 164 percent, including dividends, over the past five years, compared with 60 percent for the S&P/TSX Composite index, Canada’s benchmark equity gauge.

Ten percent of Brookfield Financial’s advisory work leads to deals for the parent company, Brookfield Asset Management, according to Cruise. Brookfield Financial has advised on at least 600 transactions worth $50 billion, including helping Dallas-based private equity firm Lone Star Funds sell C$1 billion of 295 German retail and office buildings to Dundee International REIT in 2011, Cruise said. Toronto-based Dundee listed on the Toronto stock exchange to fund the transaction. The firm, now called Dream Global Real Estate Investment Trust, has rallied 15 percent this year, the best performer on the Standard & Poor’s/TSX Capped REIT Index.

Germany, Asia

Brookfield offices in South Korea and Dubai would focus on drawing foreign investors to deals in Europe and North America, Cruise said. He was in the Asian country in November, meeting with pension funds and private equity firms as an investor from the country wanted to buy a German client’s office buildings.

“A lot of new foreign capital guys have just started going cross-border,” Cruise said. “If you go to Asia — mainland China, Korea, Japan — they don’t go cross-border all that often, but it’s really enhancing right now. What they always need on their first deal is strong on-the-ground local support.” Brookfield also works with clients on private-public partnerships and recently won the mandate to advise on the A$1 billion ($920 million) Perth Stadium in that would be their largest so-called P3 deal. The project will yield about A$9 million in fees, Cruise said. Cruise also says he has his eye on Spain and Portugal, though his priority right now is building out the U.S. “I am completely convinced it’s the future of Brookfield Financial,” he said.

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REPOST: Why middle class can't afford rents

According to this CNN.com article, rents are becoming unaffordable for middle-class families in numerous cities. Why is that so? Read it from here:

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Editor's note: Robert Hickey is a senior research associate at the Center for Housing Policy, the research division of the National Housing Conference, a nonprofit that provides ideas and solutions for America's housing challenges. The opinions expressed in this commentary are solely those of the author.

(CNN) -- A decent, safe and affordable home is something all Americans need to thrive. While the lowest-income households continue to lack access to affordable rental homes, increasingly, middle-income households are also shut out.

A new analysis by Zillow finds that the typical renter can no longer afford the median rent in 90 cities across the United States. Many Americans are severely cost-burdened: 4 million working renter households pay more than half of pre-tax income on rent.

Rents are consuming large shares of income. In Boston, for example, the median rent hit $2,458 in March, up 24% from three years ago. A household would need to earn at least $96,000 annually to afford this, based on the standard definition of affordability, in which one should pay no more than 30% of income for housing. Consider that in Boston an elementary school teacher makes approximately $58,000 per year and a registered nurse $73,000, and you get the picture that the middle class is getting squeezed. Similar median rents are now the reality in Los Angeles ($2,383) and Washington ($2,453). The housing recovery is a few years old, and home prices have started to rebound. But why isn't the rental market fixing itself?

Demand for rental homes has skyrocketed

We are seeing a major demographic convergence on the rental market. Demand is fueled by an exploding population of 20- to 30-year-old millennials looking to rent their first homes, baby-boomer retirees choosing to downsize to apartments, former homeowners exiting foreclosure, and would-be homeowners who can't access mortgages in the tightened credit market. Everyone is eyeing the same locations: cities, transit-friendly suburbs, and town centers that are walkable and close to jobs.

We're not building enough housing in desirable places

The pace of new residential construction has been insufficient to make up for the years when it was at a virtual standstill. We're simply not building enough rental housing -- affordable or otherwise -- in the places people want to live.

For example, in San Francisco, one of the fastest growing job markets in the country, there has been an average of about 1,500 units built annually, a level far below what is needed by the growing workforce. Last year alone, the city added 47,000 jobs. Most new housing is high-end

In many cities, demand is so great that there are easily enough high-income renters to support prices well out of reach for the middle class, not to mention lower-wage employees and seniors. And we can expect the imbalance between supply and demand to keep rents high for well beyond the short term. Moderately priced housing, even if it is profitable, is not as profitable as luxury housing, so the market alone will not build it. How to fix the problem?

Local governments have preciously few housing resources these days. What they have is rightly targeted at those with the greatest housing needs: our lowest income households. But here are two ideas that would help make more housing affordable for the middle class. Solution 1: Link growth with affordability

We need to loosen zoning restrictions to allow more rental housing to be built where it's needed most. There is room and adequate infrastructure to support sensible growth in many of our cities, transit-served suburbs and small town centers, where we should be relaxing height limits, reducing parking requirements, and permitting more modest-sized apartments and micro-units.

But given the huge demand and limited immediate availability of land, we cannot just build more housing and solve the problem, at least not in the short term. Consider Washington's recent experience. Median rents increased by 18% between 2010 and 2013 even as the city added more than 11,000 housing units. We need to keep growing, but we also need to make sure that more of what we build is affordable. When developers are allowed to build to heights or density greater than that ordinarily permitted by law, they should be required to share a portion of that new value by including some affordable housing for low- and middle-income renters.

This is how places like Fairfax County and Arlington County, Virginia are building out their transit station areas and streetcar corridors. Developers and residents are both on board, because it's a win-win deal. Developers profit from the enormous new potential unlocked by the zoning changes, while communities benefit from the addition of mid- and lower-priced homes that meet local needs and are close to transit. Hundreds of cities and counties nationwide have adopted similar "inclusionary housing" policies.

Solution 2: Help more qualified home buyers

We need to open a release valve on the rental market by letting more qualified, middle-income households buy a home. The National Housing Conference has assembled a broad coalition to advocate replacing the temporary patchwork we have now with a reliable system to help people buy a home. Housing finance reform based on sound principles would help homeowners and ease pressure on the rental market. These housing solutions are doable, capable of winning bipartisan support and urgently needed.


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REPOST: 5 Tips for Refinancing a Mortgage With Bad Credit

This article shares tips on how your refinance your mortgage despite having not-so-good credit standing.

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Image Source: ebony.com

Refinancing your mortgage can save you hundreds of dollars a month and potentially tens of thousands of dollars over the life of a standard 30-year home loan.

If you’re nervously watching interest rates rise, and are thinking about refinancing your home, you may have been sitting on the sidelines because you’re worried about your credit. While refinancing a mortgage is no doubt tougher to accomplish when your credit is so-so, or even bad, you can nevertheless get a refi done. Here are five tips to help you refinance your home loan, even if you have blemishes on your credit report.

Tip #1: Don’t Expect Ultra Low Interest Rates

You’ve no doubt seen mortgage advertisements online, in newspapers, or on radio and TV offering homeowners rock-bottom interest rates – sometimes as low as 3% to 4%%.

Well, good luck actually getting a loan at those very low rates, despite all those ads.

According to BankRate.com, as of July 29, the average 30-year fixed rate mortgage was 4.38%. So if you were hoping for record low interest rates in the sub-4% range, those days have passed.

Rates have been rising in recent weeks – especially after the Federal Reserve Bank announced in July that it would stop buying back bonds, a move that had been keeping interest rates artificially low.

There’s another reason, though, that some people shouldn’t be fooled into thinking they’ll get those “teaser” rates that lenders often advertise: It’s that the very best, low interest rate mortgages are reserved for pristine borrowers.

So if your credit is shaky, you can refinance – but just not at the cheapest loan rates available in the marketplace.

Tip #2: You typically need to have equity in your property

In the current environment, most lenders will generally not refinance your existing mortgage if your home is underwater and you owe more on the property than it’s worth.

Even if you’re not underwater, some banks won’t even want to refinance your current mortgage if you only have a little bit of equity in your house.

The reason banks shy away from refinancing properties with little equity is because the new home loan is made based on the current market value of your property.

Without much equity, your loan is seen as “riskier” – and that reduces many lenders’ willingness to issue you a new mortgage.

Also, the more conservative the bank, the greater the amount of equity they will want you to have. For example: very conservative lenders may want you to have 25% to 30% equity in your home for a refi. In other words, they want your loan-to-value or LTV ratio to be 70% to 75%.

If your credit is shaky, you can refinance… just not at the cheapest loan rates available in the marketplace.

In dollar terms, a 75% loan-to-value mortgage means that a lender is willing to lend $300,000 on a property worth $400,000.

Middle-of-the-road lenders will do mortgages with an 80% to 90% loan-to-value.

And aggressive lenders will offer mortgages with a 95% or higher loan-to-value.

Tip #3: Consider Government Insured Loans

All isn’t lost, though, if you don’t have sufficient equity in your home. You can get around that problem, and still get a refinance done.

That’s because lenders doing conventional mortgages are the ones that insist on lots of equity in your property. But that’s not the case for banks offering government-backed loans such as FHA loans, that are insured by agencies like the Department of Housing and Urban Development (HUD).

To refinance a mortgage with an FHA loan, you can have a tiny amount of equity and still get a new mortgage with a LTV limit of 97.75%. So let’s say your property is worth $250,000. With an FHA loan, you can refinance and get a loan up to $244,375, or 97.75% of your home’s value.

Tip #4: Seek an FHA Streamline Refinance

Additionally, if you already have an FHA loan, it’s worth seeking an FHA streamline refinance, which is a special mortgage product reserved only for current FHA borrowers.

For those loan applicants who might not be ideal borrowers on paper, for one reason or another, the FHA streamline refinance has a lot going for it.

For starters, an FHA streamline refinance does not require an appraisal. So right off the bat, you can still qualify for this loan even if you have no equity or your home is underwater.

Even better, from a borrower’s perspective, is that the FHA streamline refinance is easier to qualify for because the loan does not make you verify job, income or credit.

Tip #5: Make the rest of your application attractive

Bad credit alone doesn’t have to prevent you from getting a home loan refinanced. But if the rest of your loan packet is questionable, then you could be in trouble.

So try to offset any bad credit, by making the rest of your mortgage application as pristine as possible – especially if you’re seeking a conventional loan.

Gather all your job paperwork (such as W-2 statements and paystubs) and be able to document your income. Also, if you’ve been gainfully employed for a long period, stress the length of time you’ve been on your job. If you have a raise coming up later this year, or early in 2014, get a letter from your boss to this effect, if possible. That will further show job stability to a lender.

Finally, provide bank records that demonstrate proof of savings. Having cash reserves in the bank can also make your overall loan application more attractive to a lender.

In the end, if you package your application properly, and position yourself in the best possible light, you’ll discover that you can get a refinance done – even if you have bad credit or average credit.

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