Purchasing a Home or Condo in Vero Beach Florida ?
The majority of buyers of Vero Beach Real Estate and of Florida coastal properties are seeking a vacation or retirement home or condo. The entire process - purchase, closing, HOA fees and policies are probably different than what you are used to back home. Please see sections below for answers to the most frequently asked questions. Email or call us for any additional information on any property.
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Home Owners Association Fees:
The monthly or quarterly fees required to maintain the common areas and/or building exterior and landscaping can vary greatly between communities. Virtually all associations are non-profit, so fees vary with amenities, inclusions and maintenance requirements. If a complex is gated, the roads are then private, so their maintenance must be paid by the residents. A well managed community saves a portion of the monthly fees in a reserve to pay for future large expenditures.
Amenities: Communities with pools, tennis, clubhouse and beach access will be the most expensive - consider another location if you wouldn't use facilities.
Inclusions:
Condos - will typically include insurance, exterior maintenance, landscaping, cable, trash, recreation, pool, water and sewer for less than you could buy on your own.
Town Homes - may or may not include insurance, trash, water & sewer - it varies by association. Lower fees may mean you are paying for some services individually.
Detached Homes - Newer homes in planned communities often provide pool, clubhouse and lawn care, but insurance, cable water, sewer & trash are owner responsibility.
Reserves: All condo associations are required to maintain reserves for capital improvements and maintenance, but with single family home communities, it is optional. Most SF communities do have reserves however, especially if they have a lot invested in common elements - clubhouse, pool, tennis ect.. As a buyer, you are entitled to review the last few years budget of any association as part of your due diligence when an offer is in the inspection contingency period.
Better Price & Terms With a Buyers Agent:
Although we do occasionally list homes for sale for existing clients, we are primarily "buyers agents". The listing agent of a home is required by their contract with the seller to obtain the highest price and most favorable terms for their client. All Realtors are required to be members of the local MLS cooperative and give access to any agent for all listings in the MLS. A part of this agreement is the obligation to pay a buyer's agent commission from seller's proceeds, so the buyer in-effect, has personal representation by their own agent at no cost to them. More details are available here: Buyers Agency
Save on Property Taxes:
When we are asked , what are the taxes on this $200,000 home? - we have to respond "that depends on the owner". Taxes in Florida are based on valuation like most other parts of the country, but we have many exemptions that discount taxes for some and also compound over time. Starting with the assessed value (usually less than actual value) there is homestead exemption for residents and other possible exemptions for disability, age, service and widows. The homestead exemption allows a resident (not necessarily full time) to subtract up to $50,000 from the valuation. More importantly, it prevents increases of more than 3% of the Florida consumer price index in any given year. There are many other targeted exemptions too detailed to list, but a full description is available at: Indian River County Property Appraiser
Save on Insurance:
One of the greatest misconceptions about owning Florida real estate is the cost of insurance. Some homes are expensive to insure, but the cost of insurance is not directly based on value. Insurers look at many factors in great detail when determining rates. Here are the most critical:
Age of Home: Building codes implemented in the last 12 years greatly improved the structural integrity and energy efficiency of homes. A 20 year old $100,000 home will cost more to insure than a 10 year old $200,000 home! The most significant aspect of "wind damage mitigation" is the method in which the roof is attached to the walls and foundation of a home. Additional discounts are available for storm shutters and roof materials. A "Wind Mitigation Inspection" done by a licensed contractor will document the features of a home and provide discounts on insurance premiums.
Design & Features of Home: A home that is built with a "hip roof" (all roof planes slope down to walls) costs less to insure than a home with gable roofs (2 sloping sides that meet at a ridge). Pool homes will increase cost of liability insurance slightly and impact windows or storm shutters will give additional discounts.
Location : Homes near the coast, river or in a flood plain may be more expensive to insure unless they are built on an elevated lot. You can check the flood risk profile by entering an address at: Flood Smart.gov
A home that is in a high risk zone is not necessarily a home to avoid. The important factor is the first floor elevation, which is often built up several feet above flood zone to prevent water damage. Almost all homes built in the last 20 years, especially if they are part of a planned community, were required to be built on elevated ground.
Closing Costs:
Many buyers are surprised to find out how little closing costs are paid by the buyer for a cash real estate purchase in Florida. Closings are typically conducted by a title company by para legals, so the cost is usually just document preparation and recording. For a cash buyer purchasing a $300,000 home or condo, cost is generally under $500. As your buyer's agent, we will always write offer contracts with the seller paying the vast majority of the cost of sale. If you are financing a purchase, you will be responsible for your own lender fees, which are really bank charges and not closing costs. An exception to seller paid closing costs are new homes, where the builder uses their own contract and terms. While these builder contracts and terms are required, we can typically negotiate incentives that will pay part of the fee or apply to upgrades.
List Price vs Closing Price -
During the downturn (buyers market) that occurred from 2008 to 2011, it was not uncommon for a seller to accept much less than asking price. Beginning with the recovery period that started in 2011, prices have increased about 1% per month, but have not yet reached the highs experienced in 2006. We are entering what is now considered a sellers market and closing price is a lot closer (currently 94%) of last listed price. In Florida Real Estate Transactions, the seller typically pays about 10% of the sale price for cost of sale - commissions, title insurance, lien search, estoppels & repairs. As your buyer's agent, we will always write offers in your favor for price, terms and seller contributions.
Before we write an offer, we will research the following to determine an offer price that has a chance of succeeding in a sale favorable to the buyer.
- Comparable Sales - recent sales give a good starting point, but should be adjusted for condition & location.
- Days on Market - longer than average may indicate price too high, lack of maintenance or location on a busy street.
- Owner Equity - Many sellers who purchased in 2005-2006 have a high mortgage balance (we have access to records) and can't drop the price and pay off mortgage without bring cash to closing.
