Florida Homestead Exemption

One of the many benefits to living in the state of Florida is our tax laws.  Florida is relatively unique when it comes to real estate and tax laws. Homestead Exemption is a very crucial part of owning a home and can provide many benefits to homeowners. However it is not as straightforward as one may think.

Benefits of a Homestead Exemption

As a Florida resident and homeowner, a property owner is entitled to a Homestead Exemption. Essentially, this is the act of registering your primary residence with the state government for tax purposes. After registering, the benefits of homesteading are numerous.

On the most basic level, a homestead exemption entitles homeowners to a deduction of $25,000 off of their property’s assessed value. This in turn lowers the tax burden of the home and results in tax savings.

If one’s home is worth at least $75,000, he or she will receive an additional $25,000 deduction from the assessed value of the home, further increasing tax savings. This additional deduction, however, does not apply to school tax levies.

Additionally, pursuant to the Save Our Homes Amendment to the Florida Constitution, the assessed value of one’s homestead property cannot increase more than 3% per year.

What Qualifies as a Homestead Property?

Pursuant to Florida law, the definition of a homestead property is very specific.

1.   Owner must hold the legal or beneficial title

a.   Note: Can be owned by a trust, but not a corporation

2.   Must be the permanent residence of the owner. This is defined as “that place where a person has his or her true, fixed, and permanent home and principal establishment to which, whenever absent, he or she has the intention of returning.”

3.   Only applies to the portion of property that is classified and assessed as owner-occupied

a.   Note: Mixed-use properties only receive exemption on occupied portion

4.   Applies to ONE property

How to Apply for Homestead Exemption

To apply for Homestead Exemption, it is fairly simple. Essentially, you must bring the homestead exemption application to the county Property Appraiser by March 1st of the tax year for which the exemption is sought.  For example, to receive a 2014 homestead exemption, you must have filed by March 1st, 2014.

If one moves into a new home after January 1st, then one would have to wait until the following tax year for exemption.

The renewal process is generally automatic and you do not need to reapply on an annual basis, unless relocated.

If no longer entitled for exemption, it is the responsibility of the filer to notify the Property Appraiser’s office and notify them of his or her change.

All members of Team Johnson of Watson Realty Corp are true Florida residents.  We each own our own homes and understand the real estate law both from a professional and a personal standpoint.  Who better to help you than your soon to be neighbors.  Give us a call to get the ball rolling.  We would welcome an opportunity to be your real estate resource and not just be your real estate agents for the sale but rather your real estate agents for life.  Give us a call at 904-495-0146 or email us at teamjohnson@watsonrealtycorp.com

Team JohnsonWatson Realty Corp
St. Augustine, FL 32086
904-495-0146
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Deciding on a Real Estate Agent

Many smart consumers interview potential real estate agents before deciding on one to hire.  Likewise, many of the most successful real estate agents will also be interviewing you to make sure they can work with you.   Both sellers and agents should be selective about who they work with.  The following blog contains sample questions to ask any real estate professional that you are considering hiring.

1. HOW LONG HAVE YOU BEEN IN THE BUSINESS?

Experience does not always mean expertise and a lack of experience does not always mean a lack of ability.  Even the most experienced agents will and should tell you they do not know everything.  Much depends on whether the agent has access to competent mentors and the level of their training. Ask them about their team, company, etc.

2. WHAT IS YOUR AVERAGE LIST-PRICE-TO-SALES-PRICE RATIO?

Knowing the agent's average ratio speaks volumes. A competent listing agent should hold a track record for negotiating sales prices that are close to list prices. Therefore, listing agents should have higher ratios closer to 100%.

3. WHAT IS YOUR BEST MARKETING PLAN OR STRATEGY FOR MY NEEDS?

As a seller, you will need to know exactly where and how your property will be marketed.  More exposure can mean more offers. More offers can mean better "termed" deals and potential higher prices.  Ask the real estate agent how they market their homes.  Better yet, ask if they can provide you with a written marketing plan and/or examples of their marketing.

4. WILL YOU PLEASE PROVIDE REFERENCES?

Everybody has references. Even new agents have references from previous employers. Testimonials from former customers can be very helpful.  Ask the agent to provide you with these.

5. WHAT ARE THE TOP THREE THINGS THAT SEPARATE YOU FROM YOUR COMPETITION?

A good agent won't hesitate to answer this question and will be ready to fire off why he or she is best suited for the job. Everyone has their own standards, but most consumers say they are looking for agents who say they are:

·        Honest and trustworthy

·        Assertive

·        Excellent negotiators

·        Available by phone or e-mail

·        Good communicators

·        Friendly

·        Analytical

·        Able to maintain a good sense of humor under trying circumstances

6. MAY I REVIEW DOCUMENTS BEFOREHAND THAT I WILL BE ASKED TO SIGN?

A sign of a good real estate agent is a professional who makes forms available to you for preview before you are required to sign them. If at all possible, ask for these documents upfront.  Ask to see forms such as listing agreement, seller’s disclosures, etc.

7. HOW WILL YOU HELP ME FIND OTHER PROFESSIONALS?

Let the real estate agent explain to you who they work with and why they choose these professionals. Your agent should be able to supply you with a written list of referring vendors such as mortgage brokers, home inspectors and title companies. Ask for an explanation if you see the term "affiliated" because it could mean that the agent and their broker are receiving compensation from one or all of vendors, and you could be paying a premium for the service.

8. HOW MUCH DO YOU CHARGE?

Don't ask if the fee is negotiable. All real estate fees are negotiable. Typically, real estate agents charge a percentage, from 2% to 4% to represent one side of a transaction: a seller or a buyer. A listing agent may charge, for example, 3.5% for herself and another 3.5% for the buyer's agent, for a total of 7%.

9. WHAT KIND OF GUARANTEE DO YOU OFFER?

If you sign a listing or buying agreement with the agent and later find that you are unhappy with the arrangement, will the agent let you cancel the agreement? Will the agent stand behind their service to you? What is the agent’s company policy about canceled agreements? Has anybody ever canceled an agreement with them before?

10. WHAT HAVEN'T I ASKED YOU THAT I NEED TO KNOW?

Pay close attention to how the real estate agent answers this question because there is always something you need to know, always. You want an agent to take their time with you -- to make sure you feel comfortable and secure with their knowledge and experience. The agent should know how to listen and how to counsel you, how to ask the right questions to find out what they need to know to better serve you.

Team Johnson of Watson Realty Corp prides ourselves on our success as listing agents.  For the past 3 years we have led our region in listings.  We were awarded “Highest Number of Listings Taken” and “Highest Number of Listings Sold” for 2011, 2012, and 2013.  We would welcome an opportunity to interview to list and sell your home too.  Give us a call at 904-495-0146 or email us at teamjohnson@watsonrealtycorp.com

Team JohnsonWatson Realty Corp
St. Augustine, FL 32086
904-495-0146
Click Here to Search the MLS Like an Agent
View My Website
Click Here to Email Me

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What Are CDD Fees?

Whenever people start looking for a home to buy, they usually remember to ask about the fees associated with the property like Homeowner’s Association Fees and taxes.  The fees buyers usually forget to ask about are the Community Development Districts (CDD).  Many of the newer communities in Florida have CDD fees.  These fees can have an impact on how much home you can afford.  This week’s blog article is all about CDD fees.

WHAT IS A CDD FEE?
Municipal governments are reluctant to provide the infrastructure required for new neighborhoods.  As a result, land developers are responsible for installing utilities, roads, water, waste/sewer, schools, conservation areas, streetlights, and bridges.  To curtail upfront costs and offer homes at a lower price, developers takeout bonds to fund these improvements.  CDD fees also go towards funding neighborhood amenities such as parks, clubhouses, swimming pools, tennis courts, trails, golf courses, security gates, etc.  The initial construction cost is covered by the initial CDD bond.

WHEN DO YOU PAY YOUR CDD FEES
CDD bonds are repaid through an annual property tax assessment divided amongst the residents of a community, usually over 20-30 year period.  If you pay taxes as part of the mortgage payment, then the CDD fees will be included in the mortgage payment (accumulated in the escrow account).  If your mortgage payment is not escrowed, you pay your CDD fees at the same time you pay your property taxes.

WHAT ARE THE AVERAGE COSTS OF A CDD FEE? CAN IT CHANGE?
The CDD fee varies from community to community and can even vary from house to house within the same community.  Typical fees can range from $900-$4000 a year.  To verify the amount of the annual CDD payment for a home, look up the home on the county tax website ad examine the non-ad velorum taxes.  If you are looking at tax costs on a REALTOR listing, be sure to clarify if the CDD fee amount is included in the overall tax amount, listed separately, or included in both places on the listing.  The bond portion of the CDD payment usually remains fixed; however the maintenance portion could increase if the community decides to take on additional expenses.  The largest portion of the fee goes toward repaying the initial bond.

HOW LONG WILL THE CDD FEE LAST?The CDD bond will eventually be paid off after 15-30 years. There may be a small fee that continues to cover maintenance after the bond is paid, depending upon what expenses are covered by the Home Owner Association.

Many people want to stay away from CDD fees altogether but that can be difficult if looking for new or newer homes.  If the buyer is financing the amount of the CDD does go into consideration so it is not a number that can be ignored when looking for a home.  For more information on CDD fees or real estate in general call Team Johnson of Watson Realty Corp.  Our office number is 904-495-0146 and our email address isteamjohnson@watsonrealtycorp.com

Team JohnsonWatson Realty Corp
St. Augustine, FL 32086
904-495-0146
Click Here to Search the MLS Like an Agent
View My Website
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Everything You Wanted to Know About Short Sales

It has become a term that has been tossed around a lot in recent years. but what exactly is a short sale? What is involved? How does it differ from a regular sale? Short sales can be a daunting experience but if you have the right people involved and the right information it is not as bad. This week’s blog post is all about short sales.

What Is a Short Sale
Basically, a short sale is a property that sells for less than the balance owed on the mortgage. In other words, if there is a mortgage balance that is greater than the market value of the home, that property is a short sale. It can also be a short sale in the accepted sales price is higher than the mortgage but not high enough to pay all the closing costs and commissions. The term “short sale” comes from the balance needed to pay off the bank being short. It is by no means or terms a quick or short process.

Are You Guaranteed a Short Sale
Not every property qualifies as a potential short sale. Not every person or family qualifies as a candidate for a short sale. The lien holding bank must agree to grant a short sale and are under no obligation to approve a short sale. A bank will grant a short sale if the bank feels it is in the bank’s best interest to approve the short sale. It is in the bank’s best interest to approve the short sale if the bank will make more money through the short sale process than through foreclosure. It is estimated that banks might save 25% to 30% on foreclosure costs to grand a short sale over a foreclosure, but some investor guidelines make it more profitable for the bank to foreclose.

What Is Necessary for a Short Sale

Most short sale transactions are handled by real estate agents who specialize in short sales. Some agents choose to negotiate with the bank holding the mortgage themselves. Other agents will team up with an attorney and let them negotiate the short sale with the bank. There are 4 essential ingredients to a short sale; however, strategic short sales (those without a hardship) are also possible. If initiating a short sale you will need the following:
     • An underwater home
     • A willing short sale bank
     • A seller with a hardship
     • A buyer willing to purchase the home

What Role Do Real Estate Agents Play in a Short Sale

You should always make sure that your real estate agent knows what they are doing and have experience with short sales. Some aspects of the process are very similar to general real estate sales but it can vary drastically in other aspects. If a short sale is not successful you can lose your home to foreclosure. This processes should not be handled by a novice agent.

Some real estate agents throw homes on the market that will never close as a short short sale. That’s because the agents do not always qualify the short sale sellers. Some agents will place unrealistic price tags on the short sale, which the bank will never accept. Also, many agents will take the first offer that comes in whether it will close or not.


The following is what the agent does in the short sale process:
     • Gather the required paperwork and submit the short sale package to the bank. Sometimes agents hire a third party to negotiate the short sale.
     • Help the seller to price the short sale home. The price needs to be attractive enough to entice a buyer to wait for short sale approval but high enough to satisfy the bank’s payoff of the outstanding mortgage.
     • Put the home on the market. The agent must submit all offers received to the seller. Some offers will be lowball offers.
     • Negotiate the short sale. Sometimes sellers/agents will hire a lawyer to do the short sale.
     • Submits the short sale approval letter to the seller. Most sellers want a release of liability and no deficiency to do a short sale.

A short sale is one of the most important task a real estate agent can take on. If the process is not handled properly the seller can lose their home to foreclosure. We at Team Johnson take this responsibility entrusted to us very seriously and work very hard to make this process as easy as possible for our sellers. We have successfully negotiated and closed many short sale transactions in the past year. We have never failed to successfully negotiate this process. If we can be of any help please give us a call at 904-495-0146 or email us at teamjohnson@watsonrealtycorp.com

Team JohnsonWatson Realty Corp
St. Augustine, FL 32086
904-495-0146
Click Here to Search the MLS Like an Agent
View My Website
Click Here to Email Me

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Do You Need a Home Inspection?

When buying a home some people will chose to forgo the cost of a home inspection, especially if they are buying a newer home that appears to be in good condition.  This is not a good idea.  Before you purchase a home you should have it professionally inspected by a licensed inspector.  This blog will explain some of the reasons why this is not an area to cut back and save money when buying a home.

What to Expect at a Home Inspection
A good inspector will examine certain components of the house and will produce a report explaining and documenting his/her findings.  A typical inspection will last approximately 2 hours and the buyers and the buyer’s agent should be present.  This will be the buyers and the buyer’s agent opportunity for detailed explanation and to ask questions.  Most inspectors will also point out routine maintenance issues that will help the buyers long after the purchase.  The inspector will note the following:
•    whether each problem is a safety issue, major defect, or minor defect
•    which items need replacement and which should be repaired or serviced
•    items that are suitable for now but that should be monitored closely

What the Inspector Will Note During a Home Inspection



It is impossible to list everything an inspector could possibly check for; however; the following list will give you a general idea of what to expect.

Exterior
          •    Exterior walls - The inspector will check for damaged or missing siding, cracks and whether the soil is in excessively close contact with the bottom of the house, which can invite wood-destroying insects. However, the pest inspector, not the home inspector, will check for actual damage from these insects. The inspector will let you know which problems are cosmetic and which could be more serious.
          •    Foundation - If the foundation is not visible, and it usually is not, the inspector will not be able to examine it directly, but they can check for secondary evidence of foundation issues, like cracks or settling.
         •    Grading - The inspector will let you know whether the grading slopes away from the house as it should. If it doesn't, water could get into the house and cause damage, and you will need to either change the slope of the yard or install a drainage system.
        •    Garage or carport - The inspector will test the garage door for proper opening and closing, check the garage framing if it is visible and determine if the garage is properly ventilated (to prevent accidental carbon monoxide poisoning). If the water heater is in the garage, the inspector will make sure it is installed high enough off the ground to minimize the risk of explosion from gasoline fumes mingling with the heater's flame.
       •    Roof - The inspector will check for areas where roof damage or poor installation could allow water to enter the home, such as loose, missing or improperly secured shingles and cracked or damaged mastic around vents. He or she will also check the condition of the gutters.

Interior
         •    Plumbing - The home inspector will check all faucets and showers, look for visible leaks, such as under sinks and test the water pressure. He or she will also identify the kind of pipes the house has, if any pipes are visible. The inspector may recommend a secondary inspection if the pipes are old to determine if or when they might need to be replaced and how much the work would cost. The inspector will also identify the location of the home's main water shutoff valve.
        •    Electrical - The inspector will identify the kind of wiring the home has, test all the outlets and make sure there are functional ground fault circuit interrupters (which can protect you from electrocution, electric shock and electrical burns) installed in areas like the bathrooms, kitchen, garage and outdoors. They will also check your electrical panel for any safety issues and check your electrical outlets to make sure they do not present a fire hazard.
         •    Heating, ventilation and air conditioning (HVAC) - The inspector will look at your HVAC system to estimate the age of the furnace and air conditioner, determine if they function properly and recommend repairs or maintenance. An inspector can also give you an idea of the age of the home's ducting, whether it might have leaks, if your home has sufficient insulation to minimize your energy bills and whether there is any asbestos insulation.
         •    Water heater - The home inspector will identify the age of the heater and determine if it is properly installed and secured. The inspector will also let you know what kind of condition it is in and give you a general idea of how many years it has left.
         •    Kitchen appliances – The inspector will sometimes check kitchen appliances that come with the home to make sure they work, but these are not always part of the inspection. Be sure to ask the inspector which appliances are not included so that you can check them yourself.
        •    Laundry room - The inspector will make sure the laundry room is properly vented. A poorly maintained dryer-exhaust system can be a serious fire hazard.
        •    Fire safety - If the home has an attached garage, the inspector will make sure the wall has the proper fire rating and that it hasn't been damaged in any way that would compromise its fire rating. They will also test the home's smoke detectors.
       •    Bathrooms - The inspector will check for visible leaks, properly secured toilets, adequate ventilation and other issues. If the bathroom does not have a window and/or a ventilation fan, mold and mildew can become problems and moisture can warp wood cabinets over time.

Inspection Contingency
Every contract, whether it is as-is or not, has an inspection contingency built in.  On as “as-is” contract, the buyer can walk away within a certain timeframe if they discover something on the home inspection they do not like.  On a standard contract, there are provisions written into the contract stating the seller must fix any structural defects up to the amount specified in the contract.  The buyers can submit a list of requested repairs to the seller.  If the seller does not fix the repairs, the buyer can walk away and cancel the contract.  If the buyer does not make their decision within the time frame stated by the contract, they buyer can still walk away but will be liable for damages to the seller upto and including forfeiting the escrow deposit.

A home inspection is not the be-all, end-all when it comes to determining whether there is something wrong with a house.  It checks for visual clues to problems.  The inspector cannot run the risk of damaging anything in the house to discover problems.  An inspector is not a jack-of-all trades expert.  For example, he or she might tell you that there might be a problem with the plumbing but will recommend you hire a plumber to verify the problem and give an estimate to fix.  To best protect our customers, all of the agents with Team Johnson of Watson Realty Corp highly recommend always performing a home inspection.  We work with great professionals and can provide you with a list of home inspectors.  Give us a call at 904-495-0146 or email us at teamjohnson@watsonrealtycorp.com for more information.


Team Johnson
Watson Realty Corp
St. Augustine, FL 32086
904-495-0146
Click Here to Search the MLS Like an Agent
View My Website
Click Here to Email Me

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