The event is run on a 1.8-mile, 14-turn temporary street course that fronts St. Petersburg’s bay front and runs along Bayshore Drive. This year’s event will once again feature races from both the IndyCar Series and the American Le Mans Series (ALMS) as follows:

• Friday, April 3 - Action will include practice and qualifying for the ALMS event and practice sessions for the Firestone Indy Lights and IndyCars.
• Saturday, April 4 - Taking to the streets will be the Acura Sports Car Challenge of St. Petersburg’s American Le Mans Series race and the first race of the Firestone Indy Lights.
• Sunday, April 5 - Early action will include the second race of the Firestone Indy Lights. The 2009 IndyCar Series season opener, The Honda Indy St. Pete roars to life in the afternoon.

Other activities include drifting exhibitions, driver autograph sessions and live musical entertainment. In addition, don’t miss these fun activities:

• Thursday, April 2 - Winding through downtown’s beautiful waterfront, the St. Petersburg Festival of States Honda Grand Prix Illuminated Night Parade will once again kick off the festivities.
• Friday, April 3 - Fans will be looking up to Florida’s clear skies for the annual air show.

Race weekend is a family-friendly affair with activities taking place in the Bright House Speed Zone, located near Al Lang Field. Racing simulators, face painting for the kids, a rock climbing wall and Euro bungee jumper are just some of the excitement to be found off the raceway.

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Market Change

Smith and Associates Real Estate has been tracking the Bay area real estate trends for years and at their annual meeting released those trends providing some insight into what is effecting seller and buyer decisions in the resale market of condominium and single family homes. Listing Inventory in Hillsborough County

In both Hillsborough and Pinellas counties the listing inventory is lower today than it has been in the past 5 years.  This statistic compares both residential and multifamily- condominium properties.  The factors that will continue to support a reduction of inventory are the federal programs that have been established to assist seller’s in keeping their homes by reconfiguring existing problem loans to reduce short sales and foreclosures.  In addition, the fiscal policies that are providing monetary programs have reduced interest rates so consumers can enjoy refinancing at historic low rates.

Many sellers had to rent their properties placing longer term leases into effect for several years holding out for conditions favorable to sell and obtain value.  Housing values took their greatest adjustment in 2008, with sellers having to adjust value competitively to meet buyers perceived purchase power.  That total dollar volume remained below records kept over the past 5 years.  By late November into December the volume began to trend back up.  That signaled stabilization in values as sales increase and inventories continue to stabilize and in some neighborhoods decrease.

A push of closings at year end allowed the Greater Tampa statistics to be out in front of 2007 for total closed units of 14,886.  The difference was small but after a year that began with some stability and consistencies, by September with the collapse of the markets, so went real estate.  Based on contracts written late 2008 into 2009 there is a great disparity between how the market began to taper off in late 2007.  This trend, along with the diminishing listing inventories, further supports stability in values for homeowners but that also may be a marker for the buyers who were hoping to have bought at a perceived “bottom” of the market.  Again, fiscal and monetary policies have not been fully felt in sales.   As further capital becomes earmarked to conforming and jumbo loans with the competitive rates now available it is expected that 2009 sales will again improve over 2008 with some consideration towards values of some of the areas of the county improving in late 2009 into 2010.  The average price of a single family home $233,961, along with the low interest rates, makes the affordability factor high based on number of households that are able to purchase.

Condominium Sales

The total dollar volume of closed sales $325,081,733 is 20% less than prior year 2007 closings (1,619 units vs. 1,732 yr prior).  Throughout 2008 properties that were considered condo conversions had accounted for the majority of unsold inventory, remaining inventories were reduced to sell gradually or converted back to rental.  Entire condominium developments such as “The Place” in Channelside were sold in their entirety and have since converted to rental units.  The Element condominium in downtown Tampa  released its buyers and have restructured ownership in order to provide the offerings as a luxury rental tower.  As the activity has ended on new developments and without capital for any new projects in the near future it allows the buyers to have confidence in an existing condominium purchases.

Pinellas County Sales Activity

Sales were off from 2007 to 2008 in Pinellas County by 6% over the year prior.  This gap had begun to get closer in the last quarter of 2008, the turn around was in September  as residential sales began to exceed the prior year as a consistent trend.  The average price of an existing single family home is likely to rebound from the low of $249,000  as properties are expected to begin a slow rebound.  The absorption rate further supports the stabilization although the increase from year to year is within a point that shows a trend from July forward that both condo and single family had increased over a year prior. (Determined by number of units sold during the month by the total number of listings in the MLS).

You may know that Florida is the 2nd largest state for foreclosures last year due to new construction, investors, bad mortgages, and increased purchases prices. 107,833 homes were filed for foreclosure in the state of Florida. That is approx. 1.71% homes for every 1,000 household. Georgia, Arizona, Nevada, California, Michigan, and Colorado all have a higher percentage of foreclosures than Florida in the past year.

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If you are looking for a short term solution to your present housing situation, then your in luck. Larry Pollin (South Tampa) & Jessette Naftzger (St. Petersburg) can provide all of your rental services. They will rent your home out or you can view their listings for an opportunity to find a home.

Check out Larry’s website and view his current homes http://www.larrypollin.com/
Check out Jessette’s website and view her current homes St. Petersburg Rentals

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It is the New Year, and as many race to forget about the past… let’s think of the opportunties that are now amongst us. It is not entirely a clean slate as we all wish, foreclosures and short sales still represent a chunk of the housing industry and more are going to be on the books. Prices have declined as a result, and sellers are having a tough time competing with the discounts available by banks and builders. On the positive side, inventory is dwindling, and homes are being purchased at one of a kind prices.  The mortgage industry is providing all time lows in rates, and re-financing is at a 5 year high. Many people are thinking about their budgets, and how to save money… it is a perfect time to start thinking of restructuring your largest debt. On the opposite side, people have been on the sidelines waiting for prices to fall and become affordable are now getting homes at the best price with best mortgage and moving up from a rental home or upgrading their home. We are at the beginning of the year, and we all should be thinking about the dream home that is now obtainable or the mortgage we wish was less expensive.

To find your dream home, sign up for our new listing alert at New Listing Alert
To look at financing options and contact a consultant about refinancing click Smith Mortgage

www.smithandassociates.com

Barely a day has gone by during the past several weeks without a mention in the news of the FDIC, the agency that is best known for handling the disposition of the assets of failed banks and making sure consumers receive their insured deposits.

To date, failures due to the current crisis in the financial world haven’t caused undue concern. But the size of some of these institutions, such as IndyMac, have some people wondering how much the FDIC can handle before it needs a bailout.

The FDIC doesn’t receive any tax dollars; instead it’s funded by the premiums paid by banks and thrifts for insurance coverage on deposits. Its deposit insurance fund is really just an accounting entry with the Treasury Department.

FDIC promises security
Christopher Whalen, co-founder and managing director at Institutional Risk Analytics, as well as a writer and former investment banker, says the FDIC will always be able to reimburse customers for their insured deposits.

“The FDIC is like any federal agency; the government runs on cash. Money comes in and money goes out and each of these little funds gets a piece of paper that says I owe you money plus accrued interest. But really, in most cases, it just evidences legal authority to spend money. In the case of the FDIC, it merely evidences funds paid in by the industry, minus losses. But it’s still just a theoretical balance because it doesn’t reflect at all the cash available to the agency to fund resolutions.”

As long as the FDIC has a positive balance in the fund, the agency is just asking for the industry’s money back. If that money is gone, the FDIC runs a tab at the Treasury because, by law, it has borrowing authority.

Unlimited borrowing authority
Traditionally, the FDIC’s borrowing authority at the Treasury is limited to $30 billion, but Congress bestowed unlimited borrowing authority temporarily as part of the Emergency Economic Stabilization Act of 2008.

The deposit insurance fund is currently at 1.01%, meaning it has $1.01 for every $100 of insured deposits. The law requires that the fund is maintained at a level of at least 1.15%. The FDIC is required to submit a restoration plan detailing how it will bring the deposit insurance fund above the minimum within a five-year period when the fund slips below the required level.

The agency has just submitted a restoration plan and is proposing to raise premiums beginning Jan. 1, 2009. The premiums are risk-based and banks are currently paying anywhere from 5 basis points to 43 basis points. The agency wants to raise that uniformly by 7 basis points. A basis point is one one-hundredth of a percent.

The sting of those premium increases will be offset to some extent by the Federal Reserve’s announcement that it will pay interest on the reserve funds that banks are required to maintain. The Fed had been slated to start paying interest on reserves Oct. 1, 2011. The Stabilization Act moved that date up to Oct. 1, 2008.

Furthermore, in the second quarter of 2009, the FDIC wants to increase assessments to institutions that rely heavily on secured liabilities and brokered deposits.

“It would include charging banks more if they have brokered deposits or secured borrowings, and then possibly giving banks a little extra credit if they have unsecured borrowing,” say David Barr, FDIC spokesman. “Unsecured borrowings can actually decrease the cost of bank failures because the losses associated with the failure are shared with the unsecured debtors.”

In addition to raising premiums and the previously mentioned borrowing authority which is, essentially, a line of credit at Treasury, the FDIC has a second line of credit at Treasury that can be called upon, Barr says.

“We have a separate borrowing authority for what we call working capital. When banks fail, the FDIC retains assets from those banks. These tend to be illiquid assets such as physical properties or hard-to-sell loans. Since a lot of our money could be tied up in these illiquid assets, we have borrowing authority from the Treasury for working capital. It’s meant to be short-term borrowing and it would be repaid as the FDIC sells the assets.”

Not the worst banking crisis
As awful as the overall financial picture is today, the situation in the banking industry was considerably more dire 20 years ago during the savings and loan crisis.

There are 117 banks on the FDIC’s current “watch list;” about 2% of the FDIC-insured banks nationwide. In 1987 there were 2,165 institutions, or 12%, on the list. There have been 13 bank failures so far this year. In 1989, 534 institutions failed.

Institutions on the watch list are in financial trouble and are receiving increased scrutiny by the regulatory agencies. It’s important to note that, historically, only about 13% of the banks on the list have failed.

“We were in triple-digit bank failures for four or five years (back then) and we’re still here,” says Barr. “The FDIC, and the banking industry, is facing this economic downturn from a position of strength. 98% of the banks are well capitalized. That’s the highest level of capital in the regulatory arena.

“At one point we had $52 billion in our insurance fund. That’s the most we’ve ever had to help resolve troubled institutions. It’s down to $45 billion, but that’s taking into account IndyMac, Washington Mutual and Wachovia (original agreement with Citi). So, getting those behind us and still having $45 billion, that’s a strong position and we’re going to bolster it by proposed premium increases. We’re here to protect depositors — it’s what we’ve been doing for 75 years. Not a single customer has lost a penny of insured money and they never will.”

The moral to this is, don’t worry about the FDIC. Just make sure that your deposits are insured.

As seen on Fox Business online

For more information visit www.smithandassociates.com

The National Association of Realtors says pending home sales increased 7.4% from July to August; highest since June 2007.

WASHINGTON (AP) — The National Association of Realtors says pending home rose 7.4% from July to August, an unexpected piece of positive news for the battered U.S. housing market.

The group said Wednesday its seasonally adjusted index of pending sales for existing homes rose to 93.4 from an upwardly revised July reading of 87. The reading was the highest since June 2007.

Wall Street economists surveyed by Thomson/IFR had predicted the index would fall to 84.9.

The index, which sunk to a record low of 83 in March, stood at 85.8 in August 2007. 

As posted on CNN Money online 10-8-08

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October 8th, 2008 • Related • Filed Under

Filed Under: Real Estate

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This is good news as the combination of lower prices, low interest rates, and pent up demand may be coming to a head.

Pending homes sales in a report issued by the National Association of Realtors are up 7.4 percent in August compared to July, 2008. The numbers are up 8.8 percent over August, 2007.

While it is not time to crack open the champagne bottles, it is a sign that consumer demand and pricing are finding an equilibrium. Now we need to hope that the other external forces in the economy do not drag down the momentum that seems to have been built.

But after the meltdown on Wall Street does real estate look like the better investment now?

Pending home sales for August rose in all four of the regions tracked by the NAR.

Gains amounted to 18.4% in the West, 8.4% in the Northeast, 3.6% in the Midwest and 2.3% in the South.

July’s pending home sales index was revised to a decline of 2.7% from a prior estimate of a 3.2% decrease.

NAR says pending home-sales activity rose because of buyers taking advantage of low prices and affordable interest rates. August’s results show an “unleashing of pent-up demand” before the credit crisis worsened in September, Yun said. via Marketwatch

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It appears that we will see a consistent FALL season for the real estate industry in Tampa Bay. The prices have been reduced where first time home buyers are entering the market and new buyers are finding opportunities to purchase dream homes at obtainable prices. FHA loans have certainly been the key financing mechanism for those homes with minimal down payment. Inventory seems to be slowly absorbed as people are getting great deals and values from new home builders. The foreclosure and short sale market is not significant in the South Tampa market and there appears to be a constant sales pattern over the last few months. Although the short sales and foreclosures do exist, they are observered more in the price points under $250,000. The Tampa trend appears to be moving in a slight uptick of sales volume, while the sales prices stay firm. Our luxury market continues to have (luxury sales stat). Our developments in downtown Tampa, Skypoint & Ventana, have recent sales success; builders continue to move forward with Clearwater’s, Water Edge, and downtown St. Petersburg’s, Signature Place. Our open houses have had increased traffic with qualified buyers looking to write a contract. We encourage all of our clients, prospects, friends to continue to be environment conscience and utilize our website for all of your home needs.

For more information please refer to www.smithandassociates.com

Loving your house again

Forget the doom and gloom about a tanking market. You made a smart investment.

By Chris Ayres
Los Angeles Times - Opinion
August 17, 2008

First, let me say this: Of course I have regrets. After all, the purchase of our family home in Hollywood with an adjustable-rate mega-jumbo mortgage closed a mere 119 days before Countrywide Financial Corp. announced that — whoops! — it had, uh, run out of money. Of all the financial horror stories of last summer, this was the one that seemed to mark the official start of what is now commonly referred to as the “credit crunch” — the symptoms of which, if you’re an L.A. homeowner at least, include weeping openly in front of CNN real estate bulletins and waking up three or four times during the night to check the tumbling digits next to the satellite image of your home on Zillow.com.

So yeah, I have regrets. Like wishing I’d borrowed more money and bought a bigger house.

No, there’s no asterisk here, no small print, no catch. And yes, I’m aware that if I tried to sell my house now, I’d probably have to pay the buyer and throw in both my kidneys. Yet, this weekend, as we mark the one-year anniversary of Countrywide’s implosion — and by extension the end of the era when a real estate agent could add half a million dollars to an asking price just by installing a stainless steel refrigerator (sorry, I mean “chef’s kitchen”) — it seems appropriate for me to make a rather bold statement: Those of us who purchased nonspeculative property from 2004 to 2007 for the gratuitously self-indulgent purposes of raising a family and investing in our neighborhoods will ultimately have the last laugh.

OK, maybe not the last laugh — that pleasure is almost certainly reserved for New York hedge fund manager John Paulson, who made a handy 10-digit profit in a matter of months after finding a way to short-sell subprime mortgages.

But if you’re a boom-time buyer who can still pay the mortgage (not only do we exist, we’re in the majority), you have more than you think to feel happy about. You certainly shouldn’t harbor any envy toward the likes of Peter Y. Hong, author of an article in this very newspaper earlier this year with the headline, “How we cashed in before the crash; a Times reporter just couldn’t ignore the warning signs” — which, it has to be said, set a new standard for the sheer quantity of smugness that can be contained within a mere 2,000 words.
I can tell you’re not convinced, so let’s do some arithmetic. Say a real estate agent with a particularly reassuring grin talked you into buying a home in a decent neighborhood for $1.2 million in 2005, using $200,000 of your own cash and a million-dollar mortgage given to you by some dude you found on Craigslist. This is the higher end of the market, to be sure, but not out of the ordinary during the mortgage mania of the go-go Greenspan years. Now let’s pessimistically assume that the credit crunch has destroyed a third of your home’s value, so it’s now worth a paltry $800,000.

Chances are, you feel like impaling yourself on the three-pointed star on your real estate agent’s Mercedes. Before you do that, however, consider inflation. At its current unbowdlerized rate of 5%, inflation alone will devalue your million-dollar loan over the next decade to the “real money” equivalent of about $600,000, while at the same time causing your home to appreciate to $1.3 million (according to online inflation calculators).

Here’s another reason to pat yourself on the back: You got a mortgage before banks stopped lending to anyone other than the king of Saudi Arabia, which means your interest rate is almost certainly much lower than the rate that will be offered to the likes of Mr. Hong when he tries to get back into the market on the cheap.

Indeed, interest rates are just as important as the asking price in calculating the true cost of a house. When foreclosure vultures whine about how even post-crunch house prices are too high compared with the growth in American wages since the 1970s, they conveniently fail to mention that interest rates have moved in the opposite direction since then and even now are cheap by historical standards. In the darkest hours of the Carter administration, a loan at 20% wasn’t unheard of.

Aha, I can hear you say, but what about the dreaded A-word? Aren’t we all doomed to bankruptcy because our mortgages will adjust? In a word, no. The payments on most pre-2007 adjustable-rate mortgages would go down if they reset today, because the indices on which they’re based remain in the low single digits. Sure, if you have an interest-only loan, the payments will go up when you start paying off the principal — but by then, inflation almost certainly will have started to work in your favor. Of course, you’ll also have to pay property taxes, but thanks to California’s Proposition 13, your property taxes won’t change dramatically until the house is sold; and as with your loan, inflation will reduce the real-money burden over time. And let’s not forget that property taxes can offset your income tax. Which brings me to my final point: the glorious all-American institution that is the home mortgage interest tax deduction.

Say you’re paying 6% — fixed for 10 years — on that eye-watering million-dollar loan. This allows you to deduct $60,000 from your taxable earnings, thus saving about $20,000 a year in the 33% tax bracket. In a decade’s time, that’s a potential saving of $200,000. Throw in another $30,000 of savings from your property tax deduction; the $200,000 you’d be theoretically saving over the same period on the difference between a pre-crunch 6% rate and, say, the 8% rate you might be offered now; and the $700,000 of equity you’ll potentially end up with after inflation’s gone to work on both your loan and the value of your home: Net result? The penalty for having bought at the height of the worst real estate bubble in history adds up to a potential $1.1 million gain.

Feeling better? Thought so. And if you ever meet someone who brags about having gotten out when times were good, ask them what inflation’s doing to their rent, how much tax they’re saving on that home-office deduction (a few hundred bucks, woo-hoo!) and, more important, where they parked all that filthy boom-time lucre they made. If they put it anywhere near the stock market, give them a hug. They’ll need all the sympathy they can get.

Chris Ayres is the Los Angeles correspondent for the Times of London and the author of “Death by Leisure: A Cautionary Tale.”