We saw good real estate showing action all week on Sanibel and Captiva, even during the deluge of rain yesterday which brought in a cool front that is expected to continue into next week. It’s a nice crisp blue-sky kind of day today. Locals are wearing their long sleeves and tourists are out in their shorts and tees even though the temperatures never got out of the 60’s. We love those folks!
McT’s Shrimp House & Tavern Sold
Just before year-end, our local MLS posted the closing and sale price of McT’s at 1523 Periwinkle Way. You may remember that was the restaurant with the bar in the back that locals referred to as the “Upside Down Lounge”, featuring unique cypress trees with their wide roots on the ceiling & trunks extending to the floor. We have seen lots of construction and activity going on there this week. Makes us wonder if a new restaurant can open before the end of high season. We are still waiting for George & Wendy’s Corner Grill to open at the west end of Periwinkle at the corner of Tarpon Bay Rd. Looks like they are getting close though.
We don’t always report on commercial property sales, but a new year might be a good time for a recap. There were none on Captiva last year; but here on Sanibel, these commercial closings were reported in 2010:
• Kona Kai Motel & Cottages, 1539 Periwinkle for $1.75M (that one was my sale).
• McT’s Shrimp House building, 1523 Periwinkle for $1.495M & the parking lot next door for $1.395M (parcels had different owners so sold separately).
• 2365 Periwinkle Way for $650K. That’s the free-standing building that used to be home to McIntosh Books. The building been remodeled over the last few months. Looks very Key West now.
• 708 Tarpon Bay Road for $635K. This is where Jean Paul’s Restaurant used to be. Next use, not yet announced.
• 1025 Periwinkle Way for $450K is the free-standing condo building in the old PMR (Priscilla Murphy Realty) Center between John R Woods Realty & the bank/Bait Box.
• A handful of other commercial condos sold too, one at The Village Shops for $112.5K & three (for $59K each) on the 2nd floor at Anchor Pointe Center between Bank of the Islands & Sweet Melissa’s.
New Lending Guidelines Benefit Young Borrowers
Under Fannie Mae’s new lending guidelines which took effect December 13, securing a mortgage is easier for some borrowers and more difficult for others according to a recent article in “The New York Times”. These new rules allow buyers to use gifts and grants from nonprofit groups for their minimum 5 percent down payment. Freddie Mac also is considering similar new guidelines. Borrowers previously were required to contribute a minimum 5 percent down payment from their own funds, with additional down payment money permitted from a gift.
These new rules help upgrade buyers and young couples who for whatever reason do not have enough money and are getting some from their families. The gift rules apply only to single-family principal residences and cover mortgage amounts in excess of 80 percent of the property’s value. The loan balance also has a limit of $729,000 in high-cost areas like New York City and $417,000 in other areas. At the same time, Fannie Mae is cracking down on debt-to-income ratios, with the maximum ratio for those seeking a conventional mortgage dropping from 55 percent to 45 percent. Fannie Mae also is increasing its scrutiny of payment histories on revolving debt, and buyers who have missed a payment will have 5 percent of the total balance added to their rations. Under the new rules, borrowers who have gone through foreclosure will be excluded from obtaining a Fannie-backed loan for seven years, an increase from the previous limit of four years.
Decision Today Voiding Foreclosures
Early this afternoon, “The Washington Post” reported that the The Massachusetts Supreme Court upheld a lower court ruling voiding two foreclosures because the banks failed to show the proper paperwork to prove they owned the loans – a decision that challenges the way mortgages were bundled and sold around the world. The Massachusetts court is the highest to rule on this issue and the decision has the potential to invalidate thousands of foreclosures across the state. It also provides more ammunition to borrowers in other states who could push the case to the U.S. Supreme Court. If the nation’s highest court rules that these transfers are not legal, the multi-trillion-dollar mortgage-backed securitization industry could face massive liability.
This is certainly is news worth following, particularly in states like Florida where the foreclosure rate is high and there are courts-only foreclosure processes.