The standards, which took effect last week and apply only to Florida, include requiring that no more than 15 percent of a building’s unit owners be delinquent on association fees as a condition of funding home loans to new buyers.

Fannie Mae buys the majority of home loans from lenders, so it wields significant power in the making of mortgages. Fannie-backed loans generally offer the best rates and lowest down payments for borrowers.

The company, wracked with financial problems of its own and in conservatorship with the federal government, said it singled out Florida after a review of its mortgage loans revealed record-high default and foreclosure rates among condo owners. It also cited the excessive number of condos listed for sale, which has driven down prices.

The new rules come at a time when condo buyers already face difficulties getting mortgages. Many banks over the past two years have dramatically pulled back on condo lending, requiring down payments of up to 40 percent in new buildings. Some lenders even have blacklisted condo buildings, citing a high risk of price declines and defaults.

Fannie Mae’s timing “couldn’t be worse,” said Jack McCabe, a South Florida real estate consultant who believes the region is mired in a housing depression. “This is effectively going to make it much more difficult to qualify.”

Needed to qualify

The new conditions include:

• No more than 15 percent of unit owners can be 30 days or more past due on association fees.

• For new condo buildings and condo conversions, at least 70 percent of units must have been sold or put under contract. That’s up from 49 percent previously.

• Fannie will have to review condo buildings itself to make sure they meet Fannie requirements – at the lender’s expense. Before, Fannie relied on the lenders to perform these reviews.

Charles Foschini, vice chairman of debt and equity finance for brokerage CB Richard Ellis in Miami, said Fannie was protecting investors, borrowers and taxpayers, as it should in a climate of increased risk.

Borrowers will benefit, he said, by knowing they are moving into a condo complex that is adequately funded and has plenty of reserves, allowing them to predict their monthly expenses.

“From the taxpayer’s perspective … the quicker we can instill sounder underwriting practices for mortgages for Fannie or anyone else the more confidence we’ll have in the market,” Foschini said.

‘Nails in the coffin’

But many condo buildings won’t meet those requirements, meaning the buildings most in need of bringing in fresh buyers will increasingly have trouble doing so.

Sharon Dodge, president of the condo association at The Venetia, a 30-year-old building next to the Venetian Causeway in Miami, said about 32 percent of unit owners were past due – more than double Fannie’s new rules.

She described the rules as “driving the nails in the coffin,” just as the association is making headway on collecting delinquent payments and when sales were finally picking up.

“To have the major source of loans draw a line through us is terrible; it’s wrong and it shouldn’t happen,” Dodge said. “The feds can’t pull the rug out from under us.”

Potential fallout

McCabe estimates as much as 25 percent of the market in the tri-county area will be shut out of Fannie-funded financing.

Peter Zalewski, whose Condo Vultures realty specializes in bulk sales of distressed condos, said his figures show that as many as 41 new buildings between the Julia Tuttle and Rickenbacker causeways, and from I-95 to Biscayne Bay, may be ineligible for Fannie Mae approval because they don’t meet the new 70 percent ownership threshold.

“It’s devastating,” Zalewski said.

Fannie is not the only source of funding for lenders who want to make condo loans. But John Bancroft, executive editor with trade publication Inside Mortgage Finance, said No. 2 mortgage guarantor Freddie Mac typically follows Fannie Mae’s lead and would likely implement Fannie’s guidelines soon.

The two companies owned or backed nearly $900 billion in new home loans in 2008, more than two-thirds of the market overall. Ginnie Mae is the major guarantor for FHA and VA loans. Few new buildings had been able to meet FHA certification requirements either, Zalewski said.

Who benefits?

Because few lenders are holding loans in their own portfolios, the Fannie vacuum could create new opportunities for cash-rich buyers who will be able to command even greater discounts, predicted Grant Stern, principal broker of Miami-based Morningside Mortgage.

“Fannie Mae declared Christmas for hedge funds who want to buy bulk in these buildings, but it’s leaving everyday investors and people who want to buy for their own personal use in the dust,” Stern said.

Stern added the restrictions further exemplified the self-fulfilling, cyclical nature of the credit crisis because Fannie’s action would bring about further price declines, more foreclosures and potentially more losses for the company.

“It starts with fear, then a reaction. Then the reaction causes that fear to occur, which then confirms the fear and causes a further negative reaction,” Stern said.

Copyright © 2009 The Miami Herald, Monica Hatcher. Distributed by McClatchy-Tribune Information Services.

Existing home sales rose 27 percent last month with a total of 11,053 homes sold statewide compared to 8,712 homes sold in December 2007, according to FAR. December’s statewide existing home sales were 28.9 percent higher than November’s statewide sales.

Florida Realtors also reported a 12 percent gain in statewide sales of existing condominiums in December, marking the third recent month (following September and October) for higher statewide existing home and existing condo sales compared to year-ago levels. Statewide existing condo sales last month increased 37.7 percent over the total units sold in November.

Sixteen of Florida’s metropolitan statistical areas (MSAs) reported increased existing-home sales in December; 11 MSAs also showed gains in condo sales, marking the sixth month in a row that a number of markets have reported increased sales activity.

Florida’s median sales price for existing homes last month was $155,500; a year ago, it was $213,600 for a 27 percent decrease. According to industry analysts with the National Association of Realtors® (NAR), there remains a significant downward distortion in the current median price due to many discounted sales, including a large number of foreclosures. The median is the midpoint; half the homes sold for more, half for less.

The national median sales price for existing single-family homes in November 2008 was $180,800, down 12.8 percent from a year earlier, according to NAR. In California, the statewide median resales price was $285,680 in November; in Massachusetts, it was $283,000; in Maryland, it was $262,109; and in New York, it was $210,000.

While overall sales have softened nationally in recent months, NAR’s latest housing outlook noted a trend of increasing activity in Florida, California, Arizona and Nevada markets. “Sales are rising in areas with large numbers of distressed properties as bargain hunters take advantage of discounted home prices,” said NAR Chief Economist Lawrence Yun. “It is imperative to provide incentives for homebuyers to get back into the market. It also depends on how effectively Congress and the new administration can help facilitate the short sales process and unclog the mortgage pipeline – impediments remain for some buyers with good credit.”

In Florida’s year-to-year comparison for condos, 3,138 units sold statewide compared to 2,814 sold in December 2007 for a 12 percent increase. The statewide existing condo median sales price last month was $130,600; in December 2007 it was $192,600 for a 32 percent decrease. In the latest data available at press time, NAR reported the national median existing condo price was $185,400 in November 2008.

Last month, interest rates for a 30-year fixed-rate mortgage averaged 5.29 percent, significantly lower than the average rate of 6.10 percent in December 2007, according to Freddie Mac. FAR’s sales figures reflect closings, which typically occur 30 to 90 days after sales contracts are written.

Among the state’s large to medium-size markets, the West Palm Beach-Boca Raton MSA reported a total of 638 homes sold in December compared to 467 homes a year ago for a 37 percent increase. The existing home median sales price was $246,000; a year ago, it was $337,900 for a 27 percent decrease. In the year-to-year comparison for the existing condo market, a total of 527 units sold in the MSA last month, up 26 percent compared to 419 condos sold the previous December. The market’s existing condo median price was $112,900; a year ago, it was $161,400 for a 30 percent decrease.

© 2009 FLORIDA ASSOCIATION OF REALTORS

Florida’s median sales price for existing homes was $187,800 at year-end 2008; a year previously, it was $234,300 for a 20 percent decrease. The median is the midpoint; half the homes sold for more, half for less.

“Taking steps to energize and stabilize the real estate market is key to economic recovery,” says 2009 FAR President Cynthia Shelton. “Not only do strong housing and commercial property markets generate business, but they are essential to helping families build wealth and stability.

“Research shows that the typical Florida homeowner intends to hold their property for 10 years. In 1998, Florida’s statewide median price was $104,700; at the close of 2008, the statewide median price is $187,800. Long-term homeowners continue to have the benefit of price appreciation, as well as a benefit that simply can’t be measured – a place to raise their families, make memories and enjoy their lives. A place to call home. And now, more than ever, consumers can rely on the expertise of Florida Realtors to help them meet the challenges of today’s marketplace, whether they’re looking for a home or the perfect place for a new business.”

Five of Florida’s metropolitan statistical areas (MSAs) reported increased existing-home sales for year-end 2008; at the same time, four MSAs showed gains in existing-condo sales. December marked the sixth consecutive month that a number of Florida markets noted higher sales activity.

Economic issues are continuing to affect consumers and thus inhibit the housing market, according to Lawrence Yun, chief economist for the National Association of Realtors® (NAR). But in NAR’s latest housing outlook, he noted that the right economic stimulus package could help. “With a proper real-estate focused stimulus measure, home sales could rise more than expected, by more than 10 percent to 5.5 million in 2009, and easily begin to stabilize home prices in many parts of the country,” Yun said. “Stable home prices will, in turn, lessen foreclosure pressures and lay the foundations for a solid economic recovery as the nation’s 75 million homeowners regain confidence.”

In Florida’s year-to-year comparison for existing condos, a total of 37,797 units sold statewide at year’s end 2008, a decrease of 10 percent compared to 41,865 sold by year’s end 2007. The statewide existing condo median sales price was $164,400; at year-end 2007, it was $205,200 for a 20 percent decrease.

The annual average interest rate in 2008 for a 30-year fixed-rate mortgage was 6.03 percent, down from the annual average rate of 6.34 percent in 2007, according to Freddie Mac. FAR’s sales figures reflect closings, which typically occur 30 to 90 days after sales contracts are written.

Among the state’s large to medium-size markets, sales of existing homes in the West Palm Beach-Boca Raton MSA remained basically level in the year-to-year comparison, with a total of 6,953 homes sold at year-end 2008 compared to 6,971 homes the previous year. The existing home median sales price was $302,800; at year-end 2007, it was $369,400 for an 18 percent decrease. In the year-to-year comparison for the existing condo market, a total of 6,075 units sold in the MSA at year’s end, up 7 percent compared to 5,674 condos sold the previous year. The market’s existing condo median price was $143,800; at year-end 2007, it was $198,000 for a 27 percent decrease.

© 2009 FLORIDA ASSOCIATION OF REALTORS

The Federal Reserve is struggling to explain its plans for pulling the U.S. economy out of recession as it resorts to unorthodox policy tools while official interest rates are set near zero.

Since a rate-setting meeting in December, several U.S. central bank officials have tried to lay out what the Fed can do now that it has run out of conventional ammunition to support economic growth.

Usually, the Fed can focus its policy message around its interest rate target, but with federal funds already close to zero that capability has disappeared with no clearly discernible substitute on the horizon.

“It is very difficult to communicate the nature and effects of unconventional balance sheet actions,” Glenn Rudebusch, associate director of research at the San Francisco Federal Reserve Bank said in a report earlier this month.

Rudebusch suggested the Fed needs to explain what it hopes to achieve with its various new programs to ease conditions in specific credit markets.

The Fed’s next chance will come on Wednesday, when its policy-making Federal Open Market Committee issues a statement following two days of deliberations. It will be the FOMC’s first meeting since it cut the overnight federal funds rate to a range of zero to 0.25 percent in mid-December.

Some Fed watchers expect a commitment to buying long-term Treasuries, word on an expansion of the efforts to buy securities in other asset classes, or even setting of an explicit inflation target as as a way to tackle worries about deflation.

Still, the reactive nature of many of the Fed’s moves since 2007, with programs seemingly created on the fly as fresh crises erupted, has made crafting a clear policy message more difficult, and also devalued the currency of the FOMC statement.

“The Fed has been making up plays at the line of scrimmage, rather than taking them from a playbook,” said Brian Fabbri, economist at BNP Paribas in New York. “Thus the relevance and drama of the FOMC meetings—where the markets would anticipate and react to each change in the Fed’s target rate—has been reduced.”

Helicopter Days

The Fed is now providing huge amounts of liquidity and credit to various segments of the private sector, massively expanding the size of its balance sheet in what Chairman Ben Bernanke terms “credit easing” policy.

It has attempted to distance itself from Japanese-style “quantitative easing,” when the Bank of Japan in the early 1990s set an explicit numerical target for reserves, and expanded reserves accordingly.

“The Japanese experience suggests that simply expanding bank reserves—even by a very large amount—had little effect on bank lending or on the economy more broadly,” Janet Yellen, San Francisco Fed President and an FOMC voter this year, said on Jan 15.

Still, the Fed risks a communications gap because its “alphabet soup” of programs can not be be distilled into a simple message on its policy bias—easier, tighter, or no change—or easily measured for signs of success.

Chicago Fed President Charles Evans has defined the Fed’s current actions as a proxy for doing the impossible, or setting the fed funds rate at a negative level.

“The trick, no doubt, would be to print exactly the right amount of money to fix today’s economic problems without generating another disaster via hyper-inflation,” said Rory Robertson, interest rate strategist at Macquarie Bank in Sydney.

But fine-tuning policy around a theoretical negative funds rate is tough, as then-Fed governor Bernanke acknowledged in a now-famous 2002 speech on deflation.

“Alternative policy tools … may raise practical problems of implementation and of calibration of their likely economic effects,” Bernanke said.

Bets in the derivatives markets suggest the Fed could start lifting interest rates as soon as September. Many forecasters look for a much longer spell of near-zero rates, given their gloomy economic outlook.

Jan Hatzius, economist at Goldman Sachs, said that by the end of 2010 conventional monetary policy drivers such as the Taylor Rule, which suggests appropriate adjustments to interest rates based on factors such as inflation and the jobless rate, would imply a fed funds rate of negative 6 percent.

“Our forecast of a 9.5 percent unemployment rate by late 2010 implies the largest amount of slack of the postwar period,” Hatzius said. “Fed (and Treasury) officials will need to expand their efforts to stimulate demand dramatically further.”

The Commerce Department reported Thursday that construction of new homes and apartments fell 15.5 percent to an annual rate of 550,000 units last month. That shattered the previous low set in November.

It was a much weaker showing than the pace of 610,000 that economists were forecasting and ended 2008 on a dismal note.

For all of last year, the number of housing units that builders broke ground on totaled just over 904,000, also a record low. That marked a huge 33.3 percent drop from the 1.355 million housing units started in 2007. The previous low was set in 1991.

The report also showed that applications for building permits – considered a reliable sign of future activity – sank to a rate of 549,000 in December, a 10.7 percent drop from the previous month.

The collapse of the once high-flying housing market has been devastating to the United States’ economic health.

Its spreading fallout has contributed to big pullbacks by consumers and businesses alike, plunging the economy into a painful recession that recently entered its second year.

The Obama administration wants to ramp up efforts to stem skyrocketing home foreclosures, which have dumped even more properties on an already crippled market.

The Federal Reserve has taken a number of extraordinary steps with the hope of providing some relief. It is buying certain types of mortgages and has slashed a key interest rate to a record low of between zero and 0.25 percent.

Against that backdrop, mortgage rates have dropped to the lowest level in decades in recent weeks.

But that’s provided little comfort to builders.

They are skeptical about the prospects of a housing turnaround. Unemployment is now at a 16-year high of 7.2 percent and is expected to march upward this year – a situation that can put stresses on existing home owners and can make it less likely that new buyers will stream into the market.

In fact, a key gauge of homebuilders’ confidence sank to a record low.

The National Association of Home Builders/Wells Fargo housing market index, released Wednesday, dropped one point to a record 8 in January. The index was at 9 for the previous two months. Index readings higher than 50 indicate positive sentiment about the market. But the index has been below 50 since May 2006, and below 20 since April.

Tighter lending standards, rising defaults and fear about the housing market’s future have sidelined buyers, an absence felt acutely by homebuilders such as D.R. Horton Inc., Pulte Homes Inc. and Centex Corp.

Copyright 2009 The Associated Press, Jeannine Aversa (AP Economics Writer).

Name the segment of real estate – retail, offices, housing, condos and the consumer’s frame of mind – and the survey finds that with few exceptions belief in the market has sagged to lows seldom seen in the state, says Wayne Archer, executive director of UF’s Bergstrom Center for Real Estate Studies.

“The big news is that the recession and the latest shocks in the financial markets and automobile industry have finally taken their toll,” he says. “People not only foresee tough times in the short-term, but they’re also revising downward their longer-term future outlook.”

The most recent quarterly survey of Florida real estate trends completed in December suggests the investment outlook for various types of properties has sunk to depths not seen for three decades, Archer says.

“We’ve come a long ways down in three years to the point where we’re comparing the situation now to the recession of 1974,” he says. “What started with a mortgage crisis has spread to a general financial crisis and is now spreading to employment.”

The downturn in job rates has hurt retail more than any other real estate sector over the last quarter, Archer says. Except for free-standing big box stores, the investment outlook and rental occupancy rates are bleak for all forms of retail.

Growing fears on the part of consumers is contributing to the economic standstill, Archer believes. “You can’t pick up the newspaper without seeing another story about layoffs and I think that’s getting to consumers,” he says. “They’re prudently pulling in their financial resources, and as a result, things are dropping off very quickly on the retail front.”

A marked decline also is occurring with offices and is beginning to compete with retail in its severity, Archer says. As consumers buy less, one ripple effect is that firms are holding off on plans for growth and in some cases reducing staff to prepare for rough months ahead.

Falling Florida housing prices are expected to continue their decline, although surprisingly little change occurred in the sales volume of new homes, which is the component of the housing market the survey measures.

“I think there was some hope that housing prices had bottomed out three months ago, but it’s very clear now that we’re taking a lot more damage than anybody expected,” Archer says.

Expectations for condos can’t get much worse because things are already bad, Archer says. The condo market has always been volatile and is usually the first to suffer, sort of like the proverbial canary in a coal mine, he says.

“The financial problems are everywhere, but the state of the housing market and the employment picture varies significantly, with Gainesville perhaps the best off of the state’s metropolitan areas,” Archer says. “Generally, we see remarkably few foreclosures across North Florida compared to central and particularly South Florida.”

Lee County continues to be the “king” of foreclosures, with the Cape Coral-Fort Myers region experiencing the highest foreclosure rate among the nation’s metropolitan areas, and Osceola and St. Lucie counties suffering as well.

One positive sign is the recent dramatic increase in refinancing with the availability of 5 percent mortgage rates in mid-December, Archer says. If additional programs are put into place that allow 4.5 percent Federal Housing Administration mortgages for people who have difficulty making payments, it will do even more to stabilize the housing industry.

“In many cases, people haven’t been able to purchase because the financial system is paralyzed, and is either unwilling or unable to help them with transactions,” he says. “With no offers coming in, people who want to sell houses can’t sell them, and the prices go down.”

Apartment occupancy, which was up the previous quarter, reversed direction slightly in the most recent survey but is still more stable than other sectors of the real estate industry, Archer says. It could be that consumers are trying to save money by taking in roommates, creating less demand for apartment units, he says. “It’s a break for renters in being able to find better deals on apartments than they would have in the past.”

The latest survey – 13th in a series – is based on 381 responses, which is second only to the September survey with 392. The Survey of Emerging Market Conditions is the only Florida-centered survey of leaders and professional advisers in the real estate industry. In previous surveys, the investment outlook for various types of properties had remained steady.

© 2009 FLORIDA ASSOCIATION OF REALTORS®

The task force voted earlier this month to recommend that the Legislature caps Citizens’ annual rate increase to 10 percent on average statewide. It was meeting again Thursday in Jacksonville to finalize its report. It also suggests an annual cap of 15 percent for any given territory and 20 percent for any single policy.

Task force members are urging the state for Citizens to begin raising rates in January 2010.

Citizens is the state’s largest insurer with 1.1 million policies and $412 billion in exposure.

The task force must submit a report to the Legislature by Jan. 31.

Copyright 2009 The Associated Press.

“We do expect ‘09 to be the down year, to be the bottom,” David Crowe, chief economist for the National Association of Home Builders, said during a news conference at the International Builders’ Show, which runs through Friday.

The outlook reflects grim forecasts that call for home prices, new construction and home sales to decline this year, while mortgage defaults, foreclosures and unemployment continue to rise.

That dynamic has kept the housing market mired in a slump and homebuilders large and small in the red. The U.S. economic downturn, meanwhile, has crippled any hopes for a near-term housing recovery.

Crowe said he expects the number of new homes constructed to fall by 29 percent this year from last year, but then jump by 34 percent in 2010. He sees new home sales falling 14 percent this year.

“But we are expecting that trough to occur sometime in the middle of this year, and for us to come out the other end of ‘09 on an upswing,” Crowe said.

He noted that the upswing won’t be as strong as in previous recoveries because there are too many unsold homes on the market.

“We won’t be able to get through those in one year, and we’ll still probably have house price declines,” Crowe said.

Homebuilders have stepped up incentives, lowered prices and cut back on new construction, but they aren’t likely to see better days until the rate of foreclosures slows and home sales pick up, he said.

That’s unlikely to happen for many months, however, because consumers’ confidence in the economy remains shaken, and the job market will probably continue to deteriorate through the rest of this year, Crowe said.

The builders’ trade group has been lobbying for Congress to enact a stimulus package that will entice buyers to enter the market through a combination of a tax credit and lower mortgage rates.

Crowe said the stimulus package being considered by the Obama administration would provide some relief to homeowners facing foreclosure, but not spur new home sales.

Frank Nothaft, Freddie Mac’s chief economist, said he expects the U.S. recession to be “relatively long, relatively deep.” He projects the U.S. unemployment rate will rise to 8.7 percent by the fourth quarter of this year. The rate hit 7.2 percent last month.

“The single most important trigger event leading to (mortgage) delinquency is unemployment,” he said.

Not surprisingly, Nothaft’s outlook also calls for default rates on mortgages to keep rising this year, particularly on home loans made to prime borrowers.

He also expects home prices to continue to decline into 2010, but says the housing market should begin to show signs of improvement beginning in the second half of this year as government efforts to stimulate the economy kick in.

David Berson, chief economist for mortgage insurer The PMI Group Inc., said the company’s latest risk index shows that 97 percent of the nation’s metropolitan areas had a greater probability of home prices falling over the next two years.

“The risk went up … almost everywhere,” Berson said.

In more than half of the major metro areas, the risk of home price declines was greater than 50 percent, he added.

The panel cautiously noted that low mortgage rates, falling home prices and population trends bode well for a turnaround – eventually.

Copyright © 2009 The Associated Press, Alex Veiga (AP Real Estate Writer). All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

The rest had good credit, good income and “decent equity” in their homes, but that wasn’t enough, said Perdue, owner of Orlando Home Mortgage.

“The value of their homes killed the deal,” he said. “I had to call them and tell them, ‘I’m sorry. If your house had been worth what it was when you bought it, this would have been a piece of cake. Now the numbers don’t make sense for you.’”

Perdue’s story is a cautionary tale for many who hope to refinance their mortgages and take advantage of some of the lowest rates in history. For the lucky ones, refinancing can wipe way thousands of dollars a year in mortgage payments – a bright spot in an otherwise dim economic picture.

But if Perdue’s report is any indication, the approval rate may be fractional in this re-fi “boomlet.”

“It’s not such a bright spot if you’re upside down in your mortgage,” said Philip van Doorn, analyst for TheStreet.com Ratings. “Some will indeed benefit from the low rates, but not as many as you’d think.”

There is no surefire formula to determine whether you should refinance. First of all, focus on your potential savings, not whether your new rate will be a point or two lower than your current one.

Divide the total cost of the loan by the monthly savings from refinancing. That gives you a break-even point: the number of months before it pays off. You should live in the house at least that long for it to be worthwhile.

Beyond that, it gets more complicated. What is your credit score, and what interest rate will it fetch? What are your closing costs? Have you shopped around for the best deal? What is your home’s appraised value and subsequent loan-to-value ratio? That last item alone that can scuttle refinancing these days even if other planets are aligned.

If the refinanced loan amount is more than 80 percent of the home’s value, borrowers must pay a mortgage-insurance premium, which can dramatically reduce any savings. If it goes over 90 percent, you would have to bring money to the table, which could make the deal cost-prohibitive.

Plummeting housing prices will turn many homeowners into bystanders in this refinancing wave.

“Many who don’t have much or any equity are not invited to the refinance party,” said Greg McBride, senior financial analyst for Bankrate.com.

However, if you are among those who are in good shape with your home equity, credit score and debt level, you have a nearly unprecedented opportunity to lock in the best rates in more than four decades.

“These must be considered the lowest rates we might see in our lifetime, and they are unlikely to stay this way,” said Jason Chepenik, a financial planner and managing partner of Chepenik Financial in Orlando. “If you do qualify, you should consider paying the extra point or so to buy your 30-year mortgage rate to the low 4-percent range.”

Even if you are creditworthy, however, don’t expect easy credit this time around.

“Only good borrowers need apply,” said Andrew Orr, a financial planner with OrrGroup Financial. “We are back to the 1950s, so to speak, when people wanted a home for shelter, not for an investment. So, it’s actually a good situation now, even though it makes it difficult for people to get a mortgage.”

Copyright © 2009 The Orlando Sentinel, Fla., Richard Burnett. Distributed by McClatchy-Tribune Information Services. All rights reserved.

“The people with the biggest break this year will be non-homesteaded property owners whose values dropped,” said Dale Friedley, a tax analyst with the Manatee County Property Appraiser’s Office.

“In most cases those values are dropping between 8 and 15 percent. If their values went down 10 percent and millage is the same, they’ll save 10 percent, compared to last year’s bill,” Friedley added.

About 95 percent of Manatee nonhomesteaders will likely pay less on their tax bills this year, Friedley estimated, assuming that the millage rates stay the same.

About 78 percent of homesteaded owners saw actual savings last year on their tax assessments, though maybe not as much as they would have liked.

A state rule passed in 1995 requires assessed property values to grow by 3 percent or by the Consumer Price Index, whichever is less, as long as the property’s market value doesn’t dip below the assessed value.

That means even homeowners whose property’s market value dropped over the past year might see lower savings or even a slight increase in their taxes, he said, adding that’s especially true for valuable homes.

“Generally, if you’re just looking at your tax bill, this will probably be the first good year for snowbirds in awhile,” said Kurt Wenner, director of tax research for Florida TaxWatch, a nonprofit research foundation.

“Snowbirds are probably going to see a reduction in their taxes, or at least are not going to grow at the rate they’ve been growing,” he added. “The tax shift occurred over the last 15 years, it might be a little shifted back this year.”

“This could be the first year where people under Save Our Homes taxes go up, and people with non-homestead properties go down,” said Wenner.

Still, it all depends upon what local government decides when it comes to setting millage rates, Wenner emphasized. The higher the amount of revenue government requires, the more taxpayers can expect to pay, he noted.

Voters overwhelmingly approved Amendment 1 last year. It effectively doubled the homestead exemption on nonschool taxes for primary homeowners to $50,000; made the Save Our Homes tax protection more portable; and created a $25,000 tax break on tangible personal property for businesses. Amendment 1 also placed a 10 percent cap on yearly increases in assessments for nonhomesteaded properties, saving snowbirds from the astronomical tax increases they’d seen in years past.

However, the 10 percent cap this year may seem irrelevant to snowbirds, since values for most of them are dropping.

Copyright © 2009 The Bradenton Herald, Fla., Distributed by McClatchy-Tribune Information Services.