July 11, 2008 Newsletter
Since it’s officially summer, thoughts turn to vacation and vacation real estate. As mentioned in earlier newsletters, there are deals to be made in Ocean City and the Delaware shore. Builders who have overbuilt are giving incredible incentives to sell inventory. Some of the deals include condo fees paid for a year and financing bought down to very attractive rates. If you are concerned about the market, lessen your risk and buy with a friend. Shared equity partnerships are becoming more commonplace. Sharing a vacation property you can’t utilize all the time makes perfect sense. By the same token, if you are interested in selling an interest in a vacation home you own, let us know and we’ll publish it in the next newsletter. We already have clients interested in a sharing arrangement, and often prepare the agreements based on the parties’ wishes. The most popular form of ownership is an LLC, but there are different ways to own and title the property, depending on circumstance.
As of this writing, (July 11) interest rates are still hovering in the mid 6 range (6.375-6.625) for thirty year fixed, and ARMS are as low as the low 5’s for one year adjustables, to high 5’s for 3-5 year adjustables. Carefully watch the bond market. With stocks falling, funds often move to bonds. When bonds start moving up, interest rates move down, so the current stock market might be good news for the mortgage market. We’ll see.
In both cases, documenting and recording their interest would preserve the rights of the injured party. In brother builder’s case, he can argue that part performance gives credence to the argument that there was a contract, even though no written contract exists. But it will not be an easy case to win.
Buyers get on your feet and get moving. There won’t be a better time to have your pick of properties and interest rates that are extremely attractive. FHA/VA is the way to go for little or no down payment.
As always, call or email me your questions. You can reach me at 410 884 1160 x 3007 or email at email@example.com. We want to be your law firm and title company.