Naples Florida Real Estate News - 07/30/07

July 31, 2007 Posted in Real Estate News 

Have you paid cash for your Naples real estate, you might want to consider the pro’s and con’s of an option to forego windstorm coverage? Are more homeowner insurance companies looking for more rate increases? Is the purchase of a foreclosure a double-edged sword - great buy, but value could be declining? Answers to these questions can be found in today’s Naples Florida real estate news.

HOME OWNERS INSURANCE - Florida insurance regulators want lower homeowners insurance rates, but insurance companies aren’t making it easy. On Friday, USAA, the state’s fourth-largest home insurer, sought permission to raise premiums an average of 53.9 percent – the largest rate increase request so far.

Effective July 1, Florida property insurers were supposed to offer clients an option to forego windstorm coverage to save money. But according to the Florida Office of Insurance Regulation (FOIR), not all insurers offer that option, a non-compliance action that, according to FOIR, could lead to administrative action. Most homeowners’ mortgage lenders mandate windstorm coverage, but some older owners or retirees who paid cash for their house could save money if they opt to drop windstorm – unless a hurricane hits their house, of course.

Sometimes, the attempt at saving some insurance premiums can be disastrous from a personal financial management view. If you are an older person or retiree that paid cash for your Naples real estate, you might want to think about establishing a self-insurance savings account or money market account to cover any losses due to a hurricane and its resulting windstorm damage.

PROPERTY VALUES - Foreclosures harm more than a single family that can’t make the mortgage. Two housing analysts found that for every foreclosure within one-eighth of a mile of a single-family home, property values decline by about 1 percent – and more in dense developments.

Generally, appraisers will look within about 2 mile radius of the subject for comparables and will not include the sale of distressed properties - foreclosures as comp’s. Property values declining might be more related to current market conditions today than previously.

CONDO-HOTELS - Condo hotels may go down as one of the briefest fads ever to sweep the real-estate industry as the market slumps in Central Florida – only a year after it peaked. Potential buyers are disappearing and financing commitments are falling flat, leaving condo-hotel developers with an uncertain future.

There have been a few condo-hotel conversions in the Naples Fl real estate, Bonita Springs real estate, and Estero real estate markets, however, I never felt comfortable about recommending these, due to the similarities with timeshares and the restrictive use and possible penalties for the owner’s useage of such properties.

INCOME TAXES - The U.S. House is considering a bill that would dramatically boost the tax rate on companies that forge partnerships, including real estate firms that partner with investors to finance property acquisitions – an income tax rate up to 35 percent instead of the 15-percent capital gains rate.

Now, is it not the time to consider such a bill considering the state of the real estate market in many parts of the country.
Technorati Tags: , , , ,

Comments

Got something to say?