Fannie Mae in Florida

Well we are finally thawing out and we are definitely spoiled living in Florida. Our great friends in upstate NY gives us a weather update and I don't see how they survive.

There is yet another new listing in the oceanfront Diplomat that is priced at $289,800. This unit is fully furnished but I feel the competition of larger oceanfront units on the market is hurting The Diplomat.

There is also a short sale in the front building of Windrush that is under contract. This unit was priced at $139,900 and we will have to see what the unit closes for after bank approval.

FYI

Fannie Mae has singled out Florida for their new requirements for mortgages. Most of you know that Fannie Mae is the biggest underwriter in the business followed by Freddie Mac, Freddie Mac usually always follows Fannie Mae's lead. Miami Real Estate experts say this is the nail in the coffin for their condo market.

Some of the requirements are as follows:

2nd homes or investment condos will require at least 25% down payment and could move to 30%.

New construction is almost impossible to finance thru Fannie Mae. No entity can own over 10% of the units. At least 70% of the units must be closed or under contract. Fannie Mae will do their own review of the condo associations as in the past lenders were allowed to do their own review. This is an expensive process that can run as high as $1500 for the 1st unit under contract, paid by the buyer.

In all associations there can be no more than 15% of owners behind in their dues. This will kill a lot of smaller associations ( it may be better to try to get the review later in the month ).

I would hope that our state government will fight to change these requirements as we have to save the condo market as it is so large.

In the meantime we are gearing up to meet these requirements and it is imperative that the managers gear up on knowledge of their association. The Fannie Mae form of application is now intense as far as number of renters, foreclosures and etc.

Jim Bagwell