The appraisal
A-Who-The Bank orders the appraisal.
B-When-It is generally ordered after the inspections and everything seems to be in good order to proceed.
c-Where does it go to:
The bank needs it to justify the loan amount. The Insurance company also needs it in order to establish the insurance value.
Insurance÷Wind-Flood-Homeowners
Assumable-Some insurance policies down here are assumable (wind and flood) as the rates are set and don’t vary. It is generally easier to continue with the same policy. The key thing here is an elevation certificate. If the insurance is not assumable, you will need an elevation certificate. This can either be gotten from the previous insurer or it is done during the new survey.
V and E zones. Most canal homes are in A zones. Open water in most cases is considered a V zone. What this means is that A zone flood insurance is about a third of the cost as V zone.
Homeowners insurance will vary in cost based on value and contents. I will find out for you the current insurance company and check to see if it is assumable, and find out about the elevation certificate.
The survey
A-Who-The Title company orders the survey
B-When-This is generally the last item that is ordered-after a loan commitment has been established.
C-How much-generally about $400
The closing company
Then closing company does the title search and gathers all the documents necessary to finalize the deal.
Closing costs. Closing costs are negotiable, but generally the buyer-
Pays for the buyers title insurance(necessary for a mortgage)
Pays a year in advance for the Insurance.
Pays all costs or bank charges.
Pays prorated taxes for the balance of the year.
The closing amount generally comes in at about 2% or less of the deal.
The day of closing
Bring or mail in the balance of your down in a cashiers check. Generally about 2-3 days prior to closing, the title company will inform you of the amount.
All documents will be signed and The Keys to the home will be issued.
When the sale is closed, you will need to go to the water and electric companies to get the accounts changed over. If you are not going to be at closing this can be arranged ahead of time÷then when the closing takes place-the title company will fax a copy of the deed and the transfer will be made.
On all these issues, (Insurance-addendums or contingencies-inspections-closings, etc) my job is to guide you through it all. If you’re not going to be here, I can see that everything is accomplished.
Things I should know about my home that are unique to the Keys
Remodeling and Permits
Permits are either gotten by the owner or the contractor. The county will require drawings, a copy of a survey and deed,, and a copy of your septic permit(if you’re going to be adding livable square footage to the home)
You can as an owner get the permits, and then sub the job out. You would have to check with current regulations as to how many workers you can bring in without paying workmen’s comp.
Set Backs
20 feet from the canal and 10 ft on one side and 5 ft on the other. The main one is the 20ft from the canal, if you’re considering adding a pool or deck. This area gets complicated and it is best that you check with the county on anything specific÷these are general guidelines only!
Septic systems
In Monroe county, they will either be septic, aerobic or cesspits or central sewer. In order to expand living space the county will want to know how large your septic system is. For example most 2/2s have a 750 gallon tank. If you wanted to add a third bedroom you would generally have to replace your septic and expand your drainfield in order to get a permit.($12000 up). The county uses bedrooms as a general guide as to how many people will be living in the home and thus using the septic. Septic inspections will tell you how large the tank is or you can go to the county and find a copy of the original permit. In my own home for instance I have a 1050 gallon septic which means I could have 3 bedrooms or almost 2200 sq ft of living area.
Lower enclosures
This is a very complicated issue. Homes built after 1975 were required to be stilt homes and the enclosures below could only be for storage. A lot of people got permits for storage areas and then proceeded to put in kitchens, bath, tile floors etc. FEMA is trying to get these enclosures brought back to conformance by having you remove the interior walls, kitchens, baths. Up to now they have not been effective at doing this they are trying to pass a law that when your home is up for insurance renewal, they will do an inspection. If the lower part does not conform they will tell you what has to be done and give you a years grace to do it. Now the complicated part.
Homes up to 1981 were in some cases permitted to have baths and usable living space below.
Homes before 75, in a lot of instances had permits for lower baths, kitchens and are ok.
The best thing you can do is to research the permits. I will help you with this as who to talk to and where.
Currently FEMA has gotten a law passed that lets them inspect homes built in the last 4 years—they feel anyone who built a home recently should know that they are not allowed.
Any homes that were built before the last 4 years and/or after 1975 will at some point be inspected if FEMA has its way. It could take years but you need to know that they may be inspected.
Monroe county has said that if your home and the lower enclosure has been on the tax roll for over 4 years they will not require you to remove it—however FEMA can simply see that you get no flood insurance and the bank will pull the loan.
If you pay cash for a home and/or have no bank loan-you don’t need to carry flood insurance and this is one way to get past the issue.
yes, you can carry a seperate windstorm policy now that is not tied to you having flood insurance.
******all of this can change, the insurance companies here can bring you up to date on any changes.
Renting
Rentals go very quickly in the Keys÷we simply don’t have enough housing. If you’re looking for a place in the interim to closing your home or finding another one, (2-4 months) I generally can find you something. Down here anything over 6 months is considered a long term rental. Rates go from $1200 per month for a home and up. As to buying a home and renting it out see further down. For more information please go to
Renting your home out as a seasonal or long term.
Long term rentals are easy÷if you want to buy something for retirement later and then rent it out-this is easily done. Typically unfurnished. We can handle all of that for you for 15%. That is credit check-qualifying, collecting the money and taking care of situations. We are very proactive in this area and I assure you the home is handled professionally.
Seasonal rentals. Currently we can only rent monthly or 28 days, meaning the owner can only rent the home out 12 times per year. This means about 5 months of income-Jan-Feb-Mar and July-August. There are some June monthly’s. AS to the rest of the time, I deal a lot with navy transfers÷they generally need something for 2-3 months while they sell their home and buy another. So if it is the off season, I try to fill your home up this way. Another way to fill in the gaps is to Companies that come down here to build. Most of the major projects are done by outside firms. Their management people will generally want a nicer situation so they will rent homes out a good rates.
As to what is the best rental situation , which areas, the way water and boating accessibility affects rental amounts, the fees etc, I will help you through.
Putting in seawalls
If the home you’re looking at does not have a seawall, the first step is a company in Marathon that will inspect the property as to feasibility and then draw up the plans and submit them for permits ($750.00) Seawall permits are given by the corps of engineers and generally take about 90 days. Very important issue is mangroves÷if the property has them in most instances you can build a wood dock but not a concrete one÷in some cases there is a mitigation process to go through that will allow some removal of native vegetation (mitigation means you pay $)
Absentee ownership÷what are the costs?
Pest control÷needed on rentals. A pest service will take care of ant and other problems. Once a month they will come to the property-if tenants are in and complain of ants(after a hard rain) the pest control person at no extra charge will come out and take care of the problem, On a contract basis this runs $25.00 per month. On an as needed basis it’s $50.00 to have them come out.
Landscaping-There are services that will come out each month and cut back-prune everything and keep it manageable and looking good. This runs about $50.00 per month. If the property is large and has a lot of grass (uncommon) it runs about $100.00 per month.
Handyman-We have people that we use that take care of the small emergencies. We also have good relationships with plumbing, air conditioning, electrical and contractors.
Everyday living in the Keys
Cost of Living
Water bills on average run about $25.00 per month for a 2/2.
Electric bills average about $80.00 in our winter to $150.00 in summer for a 2/2.
Food-Stores down here, Winn Dixie, Publix are good markets with good selections. Just recently an Albertsons opened up in Key West (great produce dept)
I’ve found store prices here are comparable to Miami and other areas of the country.
Gasoline-more expensive than up in Miami area by about 10cents per gallon.
Shopping-Major malls are in Miami (about a 3 hour drive)
Restaurants. There are plenty of restaurants on the individual Islands. The main dining out for all types of ethnic foods is of course Key West. Because of the competition for the customers, the selection is good and almost all the restaurants are better than average .
Entertainment
Music-Key West has its own symphony and there is a good selection of venues and bands from Jazz to Blues, Reggae, Latin and Rock.
Arts. There are lots of galleries in Key West and there are world class artists that show there and also live here. The Island is in the arts. There is a Theater group here and also Writers group. Key West is a haven for Artistic people, from world class musicians to playwrights, screenwriters, actors and artists.
Fishing
There is fishing year round both in the Ocean or the backcountry. From sailfish to dolphin to snapper, grouper, barracuda etc.
There are lots of charter boat and regular Boat rentals available.
Diving-
There is diving year round. Looe Key, one of the best reefs in the world is just 5 miles off shore. The water temperatures here go from about 75 (winter)to 95 in the summer.
Exploring-Lots of history here. Pirates, Indians(metal detector and diving). Great areas to kayak in and explore the waters in and around all the many smaller Islands. In the backcountry there are Islands with sandy beaches within a few miles.
Airlines-Key West airport has American, Delta, Continental and others. Basically you can catch a flight from here to Miami-Ft Lauderdale and then onto anywhere in the world.
Miami-Home of South Beach, Corals Gables, Coconut Grove, Key Biscayne. Because it’s close, Miami and Ft Lauderdale make good weekend trips. Even Orlando is only about a 7 hour drive. There’s a reason movie stars and celebrities play in Miami.
