Owner Financing and Rent To Own Homes in Orlando
At least once a month for as long as I’ve been a realtor, I get asked “Do you have any homes that are owner financing or rent to own?” and I find usually that if I ask a few more questions that often the people looking for that, have not exactly understood what that is. So today I’m going to go over what that means and how you can find out if it’s for you, and stick around to the end because I’ll share two programs that may help you out, if you do decide this is right for you. Welcome back to my channel everyone, my name’s Krista Taurins and I’m a realtor with Fathom Realty in Central Florida and I’ve been selling homes in this area since 2009. I know that some of you watch me regularly and already know all of this but for those of you who don’t If you’re new to the channel please click subscribe and if you’d like to speak to me directly my preferred way to communicate is through a zoom call. I have a calendar in the description below and you can jump on there and set up a time when we can talk. My team and I are getting calls every single day and this is by far the best way to make sure you can reach me and also get my undivided attention. Now, let’s jump right into it. Let’s first discuss rent to own.A lot of times when buyers say “rent to own” what they are thinking that means and what it actually means, are two different things. Many times buyers are under the impression that they can rent for a year and that all of that rent money will go toward the purchase price, or their downpayment. That is almost never the case. Generally, you have to keep in mind that the seller also has holding costs while you’re living in the house: Taxes, insurance, HOA. So, while some portion of the rent might be applied to your purchase price, in some cases that’s not how it works. It’s more like a rental home that you have an option to buy at the end of a year. Or in some cases, depending on the type of agreement, you might be agreeing to buy the home at the end of a year. Usually that type of agreement will require some sort of upfront deposit that you would lose if you were to not follow through with the purchase So when would you want to use this? Well, this sort of scenario is useful if you don’t qualify for a mortgage this year, but you will next year. Perhaps you had a bankruptcy or a foreclosure and those aren’t quite off your credit history yet. You have fallen in love with a home and you want it to be yours, but you can’t buy right away. Or perhaps you don’t have the funds for a downpayment yet, but you will in a year. It’s a way of holding the home for you, while you live in it. Just remember, there are several important elements. Is there a deposit? Will you lose it if you don’t end up buying the home? How much if anything of each payment will be contributed to the purchase price? Now let’s talk about owner financing. Owner financing, while fairly rare, does happen sometimes. But, many times, again, there are some misconceptions on the buyer’s part. Oftentimes buyers think the owner will simply let them move in with no money down and start making a monthly payment. That is really never the case. And forgive me if all of this sounds silly to you -- I’m just repeating basically the common misconceptions that I hear. Owners will want quite a lot down, I’d say between 20 and 50%. So what’s the advantage to this? Well for owners it allows them to avoid paying capital gains taxes right away. To take a simple example, If they purchased an investment property 15 years ago for $100,000 and are selling it for $400,000 they are going to be taxed on the $300,000 and for some people that may throw them into a higher tax bracket. For buyers it’s a way to get a mortgage that may be somewhat more flexible than using a lender, and will almost always be less expensive than going to a lender, but you will have to have that substantial downpayment. So that brings me to my last and most widespread scenario and that is rent to own, but with a corporation involved that helps you do it. There are a few programs available in Central Florida where a corporation will buy a home for you, and rent it to you for up to 3 years. You can then opt to purchase it during that period of time, usually after the 1st year of renting is finished and up until the 3rd year. Some advantages to this program. First of all, the corporation pays cash, so it becomes a cash offer, which is great in this highly competitive market. It would allow you to find your forever home even if you don’t have enough cash saved up for a downpayment to purchase this year. And that seems to be the main client for this type of scenario. Someone who wants to buy, has a good job and credit score, but lacks cash for the downpayment. You could move in, rent for a year or two and then buy it from the corporation when you have your money saved up. It is spelled out up front what your purchase price will be when you do want to buy it. It works great especially if you think that housing prices are going to continue to rise. If you’re just planning on renting a home and you don’t want to buy, this program will substantially expand the amount of homes available to you as you can now look at all the homes that are for sale in addition to the ones that are for rent. It may also provide you with some stability if you are planning to be here for three years or less. In other words, you don’t HAVE to buy the home at the end of the three years. Disadvantages would be that they do have some rules about which houses you can buy. Some programs say it can’t be within three miles of an airport and most won’t agree to buy older homes, they can’t be in a flood zone, and there are some other limitations. But if what you’re interested in is a standard newer home in a subdivision, this could work out great for you. You do have to apply and be accepted. So as promised, here are the programs that are working in Central Florida. There may be others, but these are the ones I know about. The first program is Home Partners of America. It has a very handy website that will tell you exactly what your monthly payment will be on each home that you’re considering. You can also refer to this to see what homes are available through the program. The second program is called Divvy Homes, and it works in much the same way as Home Partners of America. You apply with Divvy, they tell you if qualify and if so, for how much, you then shop for your home, Divvy buys it and you can rent it for up to three years. I am registered with both of these programs so if you are interested in doing that and you would like to work with me, give me a shout. If you have any questions about any of these programs I will be happy to do my best to answer them for you. Thank you as always and I’ll see you next time.å
Read MoreIs the Orlando Real Estate Market About to Crash?
What are you supposed to do if you’re trying to buy a home in Central Florida? Will waiting a year help you get a better deal? What if you have to rent for a year? Will it still be a better deal if you’ve just blown $30,000 on rent? Only you can know what’s right for you or your family but my goal in this video is to arm you with some information. And stay tuned to the end because I’ll be predicting the future - the real estate crash in florida. Let’s tackle that today. So we’re going to be looking into some statistics that affect our housing market here in the Orlando area. Orlando remains a strong destination for people moving. In 2022, California had the biggest loss, with 343,230 people leaving, followed by New York’s 299,557. Where were they going? Florida! We gained about 320,000 new residents last year. Out of all the places in the US that saw inbound move gains, Ocala Florida topped the nation. Ocala – here is a video I made on Ocala a couple of years ago with my realtor friend Andrea of Great Expectations Realty. But out of the top ten places with inbound moves across the nation - Florida filled six of those spots. Deltona, right here in Central Florida – little Deltona – was also in the top ten. And what happened year on year in Deltona? Housing prices went up 14.5%! I remember, I kid you not, it was back in 2010 looking at a 4 bedroom pool home in Deltona that was a foreclosure and it was $48,000 and I remember thinking it was overpriced. That house sat on the market for THREE MONTHS before it finally sold. Since I haven’t already mentioned it, my name is Krista Taurins and I’m a realtor in the Orlando area. I’ve been selling real estate around here since 2009. If you’d like to tap into my expertise, please feel free to reach out to me. My contact information can be found below this video. And if you find this content useful, please consider subscribing and giving my video a like, as it does help to push along this information to similar viewers like you. So where were we? Well, hand in hand with this inbound movement, we have a couple of other things going on. Right? Rents are up. The average rent price for all property types is $2184 per month. Let’s say you just need something simple like a studio apartment or condo – the average for those is $1,600. I do think some of the rental issues were caused by an influx of people from areas hit hard by Ian waiting for their homes to be rehabbed. As they return home that may help the rental situation somewhat, but remember insurance costs are up, property values are up, which means taxes are up, and many Condo Assocation Fees, which I’m not going to get into in this video are up. The sum total is that landlords are forced to pass that along to the tenants So rents are up, maybe you should consider buying – but what’s keeping those prices up? I mean we all know we have an insurance crisis and let’s talk about that for moment. Seven insurers have gone insolvent in the past year and experts are warning that insurance premiums could jump by 20%-25%. Insurance agents are slammed with calls from customers begging them to find cheaper policies. And by the way if you are stuck in this situation, make sure that your insurance carrier knows about any improvements you’ve made to your home, consider bundling your home and car insurance with the same carrier and if all else fails your last path is to increase those deductibles. We all can read in the news about people being hit with $10,000 insurance renewal policies but for the most part unless they are coastal homes, most people are able to significantly reduce those heart attack inducing rate hikes. Insurance is up and while that may be forcing some people to sell their homes there is another awfully big factor that’s keeping people from selling and that’s interest rates. If you have a 3.5% interest rate, chances are you’re going to find it very difficult to move and take on a new higher rate, buy a much less expensive house when year on year housing prices are still up. Today’s interest rate is 6.96% for a 30-year fixed. And so that’s still keeping inventory relatively low. The only place for people to move to to alleviate some of these issues is out of state – not so simple obviously if your home, life and job are in Central Florida. So with all this, why are prices still strong? Florida’s home prices saw the highest year-to-year price increase of any state with 15.2%. There were 5% fewer listings this January than in January of 2022 – and we were already at a low level then. So my question is how long can florida keep riding on the net migration wave and will this continue to keep our prices going up? Or are people going to throw in the towel and start leaving in which case demand will slow and accordingly prices should drop. According to new figures from the Florida Department of Highway Safety, 10,824 New Yorkers swapped out their licenses in the first three months of this year. That’s down from 14,000 in the first quarter of 2022. Florida is still affordable – for New Yorkers. In January, the median sale price of a home in New York state was $486,200. In Florida, it was $386,500. What about other states trying to move to Florida? Well a lot of people seem to be able to tap into the equity from selling their home in whatever state they are moving from to offset the costs of their florida home. Our housing dilemma is being caused by a big migration inward and less movement by home sellers. So what about the future? Florida home values have risen by about 80% over the past 5 years and a positive trend is forecasted for the next 5 years. But at the same time, buyers are definitely starting to have a slight advantage, particularly with older homes that may need some work. Gone are the days that even the dogs sold in 35 seconds with multiple offers. Homes with deferred maintenance or those in less desirable areas are now facing an increased time on the market and buyers are more likely to be able to negotiate a better deal. But are we facing a crash? Some reasons why I don’t foresee that are low months of supply – although that’s getting better, we certainly are not at what we’d call a balanced market. There is a lot of new construction, but not as much as pre-2007. There are a lot of people still moving into Florida, which is keeping demand strong. Lending standards are strict, unlike in 2007 when if you could fog a mirror you could qualify for a loan. There aren’t very many foreclosures – because so many people have equity in their homes so walking away from them would simply be stupid and very unlikely. Also, importantly, our iBuyers have greatly slowed down their purchasing or stopped altogether – iBuyers like Opendoor, Zillow, Offerpad and the like who buy a home and resell it within a week for tens of thousands of dollars more are not very active any longer around here. I know there are those of you who say “oh she’s a realtor of course she’s not going to say we are headed for a crash” but ultimately it’s for you to decide. If you need to buy a home now, the best thing you can do is concentrate on getting yourself the best deal possible. Negotiate like crazy, look for motivated sellers, avoid the bidding wars – because yes, they do still exist – and try to hope and plan for a time when you can refinance into a better interest rate.
Read MoreComparison of 5 of the Orlando-Area's Best 55+ Communities
When you think of a 55 and over community in Florida, what comes to mind? Is it a scene from the Golden Girls, peach sofas, mint green accents and four ladies eating cheesecake? Or perhaps it’s Seinfeld’s parents living in Del Boca Vista fighting with the HOA over Morty Seinfeld’s potential impeachment? If that’s the case, we need to update you. We’re going to be talking about five different 55+ communities in Central Florida. This isn’t meant to be an exhaustive look at the 55 and over communities in the area, but it should give you some idea of what to expect. Now if you’re interested in working with me on the purchase of one of these homes, my contact details are always below, and if you jump down into the description you’ll find a link to my calendar where you can set up a zoom call with me, which is my preferred way to communicate on a first call. Now back to the communities. I believe in all cases lawn care, basic cable, internet are included in your HOA fee in addition to amenities. If you research these properties online you will probably be under the impression that there are quick move-in homes available but at the time of making this video I will tell you that this is not the case. Also, if you plan to visit, make sure you set your appointment in advance as most are not really accepting walk-ins. If you are looking to move into a 55 and over community here in the Central Florida area and you’re feeling overwhelmed, please feel free to reach out to me. My number is always below in the description and you can also feel free to set up a zoom call appointment with me. A link to that can also be found in the description under this video and it’s my preferred way to kick off a meeting with future clients, so please feel free to set up a call. In case you don’t know, Florida is experiencing a building boom. Now I started this tour of these communities somewhat optimistically, thinking that the 55 and over communities would not have quite as large of a crowd of buyers since buyers are of course limited by age. A somewhat limited audience if you will. I was wrong. There is almost no inventory, very limited models of homes are available and lots are being released slowly, if at all, because builders are overwhelmed. There are waiting lists for homes. I’m not even going to talk about prices because the prices are rising at least once a month in new construction. Just know that with the exception of Lennar, all the prices that you see online on the builders' websites are introductory prices and if you want for instance tile or wood floors instead of carpet, or granite instead of a basic countertop, the price is going to go up. Also the price of the lots is not included in that pricing and the lots ranged from just under $10,000 all the way up to $115,000. All the builders that I spoke to do offer some sort of incentive to use their lender, and possibly some kind of small credit in the design center toward your upgrades. I’m going to start off with Latitude Margaritaville in Daytona Beach. Now, right off the bat, if you go visit this community, I think you’ll be impressed with how they handle visits with potential buyers. You meet at a sales center and you’re taken by bus over to an area with 13 model homes to visit. This was the most model homes in one community that I’ve ever seen, and even if you’re not interested in living in Margaritaville, it’s a beautiful array of designs that I would recommend anyone to just visit. The homes are furnished in colorful and fun ways and of course, basically every room has a margarita or some sort of adult frozen concoction in it somewhere. Lively music is piped into each room and it’s actually not just Jimmy buffett. You definitely feel like you’re on vacation and like you can’t help but be happy there. Also of note is that each master bedroom is equipped with this safety button in case you need some help. Very well thought out. Let’s talk about the community a little bit. Golfing at LPGA is just a few miles away and there is a shuttle to take you to the beach. The HOA price is reasonable and varies between cottages, villas, and houses, but isn’t more than $250 per month. The community will have 3400 homes when all is said and done, a town square, restaurant, live music, pool, aerobics. Not all of the amenities are complete yet but are slated to be done soon. Margaritaville is listed as one of the top 50 55+ communities in the US and it’s easy to see why. However, if you do fall in love with this community, your happiness may end when you discover that only cottages are currently available. And those are not available for immediate move in, but still must be built. Those are the smallest square footage and are attached, duplex-style. Villas and single-family homes are sold out. More lots will be released in the fall of 2021, but prices are not yet available for that release and you’re probably going to be looking at a one-year build time. If you’re looking for a faster move-in you’re going to have to look at finding a resale home. Since Margaritaville isn’t that old, you’re basically looking at a home that’s only a few years old anyway. Current properties range from $440,000 to just under $550,000. Now if you’re looking for a smaller community a little further inland we come to the 55 and over community in Victoria Park, which is also in Volusia County in the city of Deland. Now, Victoria park is made up of several large communities, one of which features golfing, and the 55 and over community is the only guard gated section of Victoria Park. This community only has single-family homes, no attached homes. The new home builder is Kolter. There are new home lots in this section; however, none of them are available, and like with Margaritaville you are looking at a long wait for a lot and a long build time -- in Victoria Park, they are estimating about two years till you would be able to move in. I have already made a video of this community so I’ll drop a link above. This community was started in the mid-2000s so there are plenty of resale homes available at any given time with a range of prices from, at the moment $250,000 up to about $400,000. This community is guard gated, has a pool, clubhouse, restaurant, ballroom, lighted tennis courts, bocce ball, library, pickleball, lots of activity clubs and a lifestyle director. The HOA fee is just under $400 per month. Residents can use all of the amenities of all the communities of Victoria Park, although non-residents of the 55 and over community cannot use their amenities. Now going much further south to Polk County, in the city of Kissimmee, we come to Solivita, which is located about 21 miles south of Disney. Solivita is a very large guard-gated community, almost a town, with 5000 homesites. The builder is Taylor Morrison, and it used to be Avatar, but Avatar was acquired by Taylor Morrison. This one, like Margaritaville has its own distinct style and in this case, its more of a Mediterranean feel, with stuccoed buildings and barrel tile roofing, at least in the town center but many of the homes have a similar Spanish or Mediterranean style to them. This community also offers you a number of different model homes to look at and explore after you take a short golf cart ride from their sales center. This community has an impressive 14 swimming pools, including an indoor pool, fitness classes, golfing, 3 restaurants, a library, an art gallery, classes to take, a lifestyle director, it’s all accessible by golf cart if you choose, and it’s surrounded by nature and conservation areas on the territory of Solivita. At the time I visited, they actually had one inventory home. And since this community has existed since the early 2000s, there are plenty of resale homes available, even rental properties, and prices range from $180,000 up to $585,000 for a former model home. This community has but a handful of lots left and is largely built out, so if you are interested in buying a brand new home, you’ll have to act quickly. The HOA fee is just shy of $400 per month. There is also a CDD and that will run you about $687 per year. If you’re interested in joining a community toward the beginning of it’s build out, then you might want to check out DelWebb’s Sunbridge in St Cloud. This community is located just five miles south of Orlando’s Lake Nona. Otherwise, you will have a drive to the beach or to Disney and it is maybe a bit remote apart from that. Since it is a relatively new community the main 27000 square foot clubhouse is not yet built and that’s something you’ll have to decide if you’re comfortable with, but they expect it to be completed in 2022. The amenities will include a Clubhouse, pool, tennis courts, pickleball courts, corn hole, an amphitheater, craft rooms, a gym, group fitness rooms and more. Now one thing that did stand out about Del Webb was that the price for lots was surprisingly higher than most of the other communities, with current berm lot prices starting at $36,000 and villa berm lot prices starting at $16,000. Premium lots go all the way up to $115,000, so that’s really going to affect your bottom line. Remember, that goes above the cost of the home that you’re looking at, so if you’re looking at it online remember that you’ll still have to add the lot and any upgrades you may want. As far as HOA fees go, The villas' HOA fee is $423 per month and includes outside paint and roof and termite treatment in addition to the usual landscaping and internet, while the homes are either $370 or $380 per month. Out toward the east coast of Florida in Viera, we have a Lennar Community called Bridgewater. Bridgewater has three model homes to tour but, like in most of these communities, they are selling lots slowly and in this case, taking highest and best offers -- and they are selling within days of being released. So here is how that works, you tell Lennar which model or models you are interested in, and when one of them becomes available, they will let you know. At that time they will tell you which lot it will be built on, and what color scheme is being used in the home. So in other words, brown cabinetry, or white cabinetry, what flooring, what backsplash, etc. it is all predetermined, and up to you to decide if you want to make an offer on it. Then they take the highest offers of all the interested people and select one. These are not customized homes. The good thing is these homes take less time to build as there is no room for you to change your mind and make changes to the design or color scheme, which often sets builders back by months. And also, the price you see on their website will be the actual price of the home, they do provide a range of prices and that’s because there can be variations in each model and certain lots cost more than others. In this community almost all the lots are waterfront. This community does not have a CDD, but it does charge you a small fee, I believe it was under 1% of the purchase price, at the time of closing, to pay back some development expenses. That is a one-time fee. The HOA fee is $292 per month and the community when complete will have just a little over 800 homes. Like with Del Webb Sunbridge, this community is in its earlier stages and so some of the amenities have not yet been built. In addition to owning its own mortgage company, Lennar also has its own insurance company and so can also write your homeowners insurance policy. There are a wide range of communities available and many I didn’t get to visit. If you have any special requests for videos feel free to shoot me an email. Thanks for watching!
Read MoreIs Winter Springs, Florida a Good Place to Live?
Today we are going to be talking specifically about Winter Springs FL. I’m not going to cover the general living in Florida pros and cons so if you’re looking for information on the weather or love bugs or low taxes or bad storms, this won’t be the right place for info. Winter Springs is a town of 36,000 people located just a little north of Orlando. To give you some idea of the location, it'll take you about 25 minutes to drive to Orlando, about 45 minutes to get to Disney, and about a 25-minute drive to the University of Central Florida. I think your closest beach is New Smyrna Beach, and that will take you about an hour. Cocoa Beach is just a little further at an hour and 15 minutes. Pro Number 1. When people who live in Winter Springs tell you what they love about living there, natural spaces are high on the list. There are abundant public parks throughout the city, including some with walking trails alongside lakes, creeks and rivers. Two of the parks have splash pads for young children, and ball fields of all types. The cross-seminole trail passes through Winter Springs, giving you access to 23 miles of walking and biking, most of it through natural settings. They also have neighborhoods in Winter Springs that still offer a country setting, many with multiple acre lots, some hosting active equestrian properties. Many of these are not in HOAs, which I know is important to many of you. Wildlife abounds in the city and just about anywhere you are, you are likely to see hawks,owls, herons, cranes, tortoises and rabbits, with bobcats, coyotes and even bears making an occasional appearance. Pro Number 2. Amenities - Although Winter Springs is a small town, they have grown in a smart and planned way, giving the residents easy access to nearly any service they might want. From several dozen restaurants to health care for both people and pets, multiple grocery stores, multiple banks, and hundreds of professional services. Additionally, the sister city to Winter Springs, their immediate neighbor, is the booming city of Oviedo, which hosts the Oviedo Mall, and two emergency rooms. Regarding schools, some parts of Winter Springs are zoned for Winter Springs High School, while others go to Oviedo High School. In any case, you are in Seminole County and zoned for those schools, so you would be able to take advantage also of any of the great charter or magnet programs that your student may be interested in. I’ll drop a link to how you can determine what school a home is zoned for and don’t forget to check that as the information provided to you in the MLS is only as good as the realtor who put it in, and not all of them check! https://www.scps.k12.fl.us/schools/find/ Pro Number 3. City services - When I asked some friends what they love most about living in Winter Springs, they mentioned the city services. The city of Winter Springs is well funded and hosts events throughout the year, from fireworks in July, an Easter egg hunt, movie nights in the park, and a holiday extravaganza in December. Just this next month, Trotwood park is hosting a food truck artisan fair with live entertainment. The police are very active and if you are traveling, just let the police know and they will drive by your home daily, and even walk your property. If you have questions about your yard or trees, the city arborist will come out and help you. Now let’s move on to a Neutral topic -- both pro and con. Since this is a real estate channel, let’s talk about houses. There are just 32 single-family homes for sale in Winter springs right now, so it does not have the widest choice available and probably explains why I don’t have too many people contacting me to say they are really interested in living in Winter Springs. Mostly my Seminole County clients are debating between Lake Mary and Oviedo, but Winter Springs really should not be overlooked. Prices range from $150,000 to $1.8 million. I mentioned earlier you can find a home not in an HOA and if that’s something you’re looking for, Oak Forest is a great place to look, with homes in the $300s. Cons Con Number 1. As mentioned, the police force is active. The one thing you don't want to do in this quaint, quiet, city is speed. I may or may not be speaking from direct experience here. I am. I am actually speaking from experience here. I was 100% sure the road I was on was a 35 mph limit and it turned out to be 25. I was doing 37 and I got a ticket. I was so sure that it was 35 that I was actually confused why I was pulled over. There are police all over the place, and now I notice them more. You have been warned. Con Number 2. Booming development - While the city has been very careful in its planning and has preserved natural spaces, they always knew the demand would come and it surely has. The roads are a little busier,and there are fewer cows and horses. If that rural country feel is what you’re looking for you, you might have to head toward Geneva or Chuluota in Seminole county nowadays. Con Number 3. Less well known - Part of the appeal of Winter Springs is it's hidden gem status, but when the time comes to sell your home, it can take little longer to sell. As I said earlier most people contact me about moving to Oviedo, not to Winter Springs. In fact, there are three “winters” in the area and most people get them mixed up at first. You have the well-known Winter Park, you have Winter Haven, Winter Garden to the west and you have Winter Springs. Lots of Winters...but Winter Springs is the one in Seminole County. I hope that this introduction to the pros and cons of Winter Springs has given you something to think about and as always I’m here for you if you want to discuss real estate. Thanks for watching.
Read More
Categories
Recent Posts