Our weekly Real Estate Market Watch gives detailed information on the current real estate market in eastern Sussex County, Delaware. Click on any of the links below to view the reports, showing new listings and sold listings for each area.

Lewes and Rehoboth Area Real Estate

Lewes, Rehoboth and Dewey Beaches Real Estate

Bethany and Ocean View Area Real Estate

Bethany Beach and Fenwick Island Real Estate

Angola and Millsboro Area Real Estate

Milton Area Real Estate

Georgetown Area Real Estate

Milford Area Real Estate

The Sussex County Association of REALTORS (SCAOR) invites all Delaware residents to their Georgetown-area headquarters on Wednesday, Sept. 22, to learn more about this recently enacted law, what it entails and what all homeowners must do to be compliant.

“As REALTORS, we’ve found that this is not a popular law, nor is it one that people fully understand,” says Judy Dean, 2010 president of SCAOR.

“New changes to this law went into affect on Aug. 11 and people need to be aware of what these changes mean for them. If you live in a common interest community in Delaware, you must learn how to be compliant with this very complex piece of legislation.”

Passed on Oct. 31, 2008 by former Gov. Ruth Ann Minner and revised by Gov. Jack Markell last summer, DUCIOA regulates the creation and operation of common interest communities containing residential property. It is a rewrite of the Unit Property Act, Delaware’s condominium law for decades, and is meant to bring clarity to the many technical questions inherent in the previous legislation.

Many of the changes made to DUCIOA were adopted after input from homeowners, condominium boards, condominium managers, builders and Realtors.

“The biggest problem we’ve encountered, as Realtors, is that people simply don’t understand this law and what it means for them,” says Dean.

“We hope to bring some clarity to that situation on Sept. 22. DUCIOA is definitely a difficult law to understand, but we hope our experts can shed some light on the situation.”

A few of the elements of the DUCIOA which affect all homeowners within Delaware’s planned communities include:

• Contents of the declarations, bylaws and plans. These documents are all now subject to requirements.
• Development rights and special declarant rights. There are now specific provisions regarding the reservation of development rights and their regulation and limitation.
• Assessments and liens. The new law establishes a statutory lien for unpaid assessments and provides for collection methods.
• Protections for purchasers. The legislation obligates the declarant to provide a public offering statement containing information about the common interest community and establishes a 15 day rescission period for the purchaser.
• Insurance. There are now more detailed insurance provisions applicable to common interest communities and the types of insurance that should be obtained by the homeowner’s association.

There are many more parts of this law, however, that First State homeowners need to be aware of, which is why the leadership of SCAOR has scheduled its third informational session regarding DUCIOA. This third session is designed as a free class, taught by experts in the field.

“People just are not complying with this new law, some because they don’t understand it and many more because they don’t feel it applies to them,” says Dean. “Let me be clear on this point. If you live in a common interest community that contains residential property, and that includes condominiums, townhouses and planned communities, you must adhere to the provisions of DUCIOA. Join us on Sept. 22 at 5 p.m. to learn what this means for you and your family.”

This free class offered by the Sussex County Association of REALTORS will be held at SCAOR’s headquarters complex on Route 9, just a couple of miles east of Georgetown. To reserve a space in the class, or for more information, contact TracyLee Elmore at tracylee@scaor.com or 855-2300, ext. 205.

SCAOR was chartered in 1949 and has steadily grown in size, scope and mission during its 61 years in Sussex County. It is a professional trade association with goals of carrying out a program of education and advocacy for real estate in the county.

SCAOR is a resource for the public, as well as a recognized advocate for property rights and property owners in Sussex County. The association also monitors legislative issues on the local, state and national levels that may impact home ownership in the area.

Press release from SCAOR.

WASHINGTON – Mortgage rates have fallen to the lowest level of the year as investors poured money into the safe haven of U.S. government securities.

The average rate on a 30-year fixed rate mortgage dipped to 4.78 percent this week from 4.84 percent a week earlier, mortgage company Freddie Mac said Thursday. It was the lowest level since early December, when rates fell to a record low of 4.71 percent.

The average rate on a 15-year fixed-rate mortgage fell this week to 4.21 percent_ the lowest level in nearly two decades.

Concerns over the European debt crisis have sent yields for 10-year and 30-year Treasury bonds to their lowest levels of 2010. Rates on 30-year home loans often rise and fall in line with the 10-year note.

Analysts say the opportunity may not last. If Europe’s woes subside and the U.S. economic recovery stays on track, rates are likely to move higher. That’s because traders will move their money back into riskier investments.

“Strike now,” said Greg McBride, senior financial analyst at Bankrate.com. “If they move quickly against you, it just takes money right out of your pocket.”

Homeowners appear to be taking notice. Applications to refinance surged this week to the highest level since October 2009, the Mortgage Bankers Association said Wednesday.

But mortgage applications to purchase homes fell to the lowest level since April 1997. A major reason for that drop: tax credits expired on April 30.

A campaign by the Federal Reserve to reduce borrowing costs for consumers pushed rates down to extraordinarily low levels last year. Rates were expected to rise after the program ended this spring. Instead, they have dipped. Fears that Greece’s government would default on its debt shook world markets and boosted demand for U.S. Treasurys.

Freddie Mac collects mortgage rates on Monday through Wednesday of each week from lenders around the country. Rates often fluctuate significantly, even within a given day.

Rates on five-year, adjustable-rate mortgages averaged 3.97 percent, up from 3.91 percent a week earlier. Rates on one-year, adjustable-rate mortgages fell to 3.95 percent from 4 percent. That was the lowest average since May 2004.

The rates do not include add-on fees known as points. One point is equal to 1 percent of the total loan amount. The nationwide fee for loans in Freddie Mac’s survey averaged 0.7 a point for 30-year, 15-year and 5-year loans.

The average fee for 1-year loans was 0.6 of a point.

The average rate on a 30-year fixed rate mortgage dipped to 4.93 percent this week from 5 percent a week earlier, Freddie Mac said Thursday. It was the lowest level since mid-December, when rates averaged 4.81 percent.

The drop came as investors shifted money from risky European debt to safer U.S. securities. Bond yields fell as a result, and that lowered mortgage rates.

Freddie Mac collects mortgage rates on Monday through Wednesday of each week from lenders around the country. Rates often fluctuate significantly, even within a given day.

The average fixed rate dropped to a record low of 4.71 percent late last year, pushed down by a campaign by the Federal Reserve to reduce borrowing costs for consumers. The program ended this spring, but rates have remained low, especially after fears that Greece’s government would default shook world markets.

“In times of nervousness, everybody seeks the safe haven,” said Greg McBride, senior financial analyst at Bankrate.com

The last time rates for 30-year fixed mortgages averaged less than 5 percent was the week of March 25, when they were 4.99 percent.

This week, the average rate on a 15-year fixed-rate mortgage was 4.3 percent, down from 4.36 percent last week.

Rates on five-year, adjustable-rate mortgages averaged 3.95 percent, down from 3.97 percent a week earlier. Rates on one-year, adjustable-rate mortgages fell to 4.02 percent from 4.07 percent.

The rates do not include add-on fees known as points. One point is equal to 1 percent of the total loan amount.

The nationwide fee for loans in Freddie Mac’s survey averaged 0.7 of a point for 30-year loans 0.6 of a point for 15 year, 5-year and 1-year loans.

 By ALAN ZIBEL, AP Real Estate Writer Alan Zibel, Ap Real Estate Writer

Prudential Gallo, REALTORS also enjoyed a productive 1st quarter of 2010. Our new sales increased by nearly 80% compared to the 1st quarter last year (115 units in 2010 compared to 64 in 2009). New listings were also up by 36% (155 units in 2010 compared to 114 in ’09).

Our weekly Real Estate Market Watch gives detailed information on the current real estate market in eastern Sussex County, Delaware. Click on any of the links below to view the reports, showing new listings and sold listings for each area.

Lewes and Rehoboth Area Real Estate

Lewes, Rehoboth and Dewey Beaches Real Estate

Bethany and Ocean View Area Real Estate

Bethany Beach and Fenwick Island Real Estate

Angola and Millsboro Area Real Estate

Milton Area Real Estate

Georgetown Area Real Estate

Milford Area Real Estate

That trend is likely to continue well into the new year. That’s because interest rates are hovering near all-time lows, home-price affordability is near all-time highs and a third factor – Congress’ extension of the first-time homebuyer tax credit until April 30, 2010 – make conditions quite favorable for those considering homeownership for the first time.

Still, with the prospect of making one of the largest investments you’ll ever make in your life, you can easily become overwhelmed. Some of the questions you may be asking are: Will I be able to afford the home of my dreams? Do I have enough money for a down payment? Will I qualify for the tax credit? Will I make smart home buying decisions? If you go into the process prepared, your first purchase – like the current timing – can be just right.

Resources–Before starting out, educate yourself on the process. Attend a homebuyer seminar in your market, and check out myriad real estate resources online. Among those helpful online resources is prudentialrealestate.com, through which you can access millions of property listings and gain environmental reports, property profiles and value-range estimates for just about any residence in America.

Your real estate professional also is a great resource. Don’t hesitate to let him or her know that you are new to the process. Your real estate professional will expect you to have questions at each step, from house hunting to making an offer through closing.

The costs involved in the purchase of a home can seem overwhelming to first-time homebuyers. There are mortgage costs, the down payment, and closing costs to think about.

Affordability–By looking at your income and debt ratio, your sales professional can help you calculate how much you can afford each month in mortgage payments.  But before determining your price range, you should also take into consideration other factors that will affect your monthly budget once you are a homeowner, such as property taxes, insurance, homeowner association dues, utilities and maintenance. And if your down payment is less than 20 percent of the cost of the home, you will be responsible for private mortgage insurance, more commonly referred to as PMI.

Mortgage payment–Fear of being rejected for a home loan is one of the main concerns for first-time homebuyers. To lessen the stress, you may want to get pre-approved for a loan before looking at prospective homes. This will not only help you feel more confident, it will also give you an advantage where there are multiple offers for a specific property. In addition, the fact that your loan has already been approved is of great value to the seller because it shortens the purchase process, and there is less of a chance that the buyer will back out of the sale. If you don’t have a specific mortgage lender in mind, ask your sales professional for a recommendation.

Down payment–The down payment amount varies depending on the value of the home you choose and your mortgage lender. Your real estate professional will be able to explain the different options available to you.

Tax credit–The first-time homebuyer tax credit, a key component of the American Recovery and Reinvestment Act of 2009, equates to as much as $8,000, or 10% of a principal residence’s purchase price, and is available to those who have not owned a principal residence in the past three years. You can use the tax credit to help purchase your home or help pay for its closing costs, or the credit can be used to remodel, refurnish and repair your property. See your tax advisor for details about the tax-credit program and how you may benefit.

Making offers–Don’t feel pressured into making an offer on the first home you see. This is a common mistake of many first-time homebuyers. Make sure you view different homes to get a feel for the marketplace. When you decide on a home to make a bid on, work with your real estate professional to get all of your questions answered before making an offer. But don’t wait too long to make an offer. The longer you wait, the greater the chance other prospective buyers may place offers, making it harder for you to negotiate a good deal.

Above all, remember there are no silly questions. Make sure you understand and are comfortable with every aspect of the transaction. Your real estate professional can be an invaluable asset in helping you make educated decisions so that your first home purchase is a rewarding experience.

As part of its plan to stimulate the U.S. housing market and address the economic challenges facing our nation, Congress has passed new legislation that:

• Extends the First-Time Home Buyer Tax Credit of up to $8,000 to first-time home buyers until April 30, 2010.
• Expands the credit to grant up to $6,500 credit to current home owners purchasing a new or existing home between November 7, 2009 and April 30, 2010.

Here is a link to a chart that fully details the credit:

 http://www.prugallo.com/documents/homebuyer_tax_credit.PDF

Who Qualifies For The Extended Credit?

• First-time home buyers who purchase homes between November 7, 2009 and April 30, 2010.
• Current home owners purchasing a home between November 7, 2009 and April 30, 2010, who have used the home being sold or vacated as a principal residence for five consecutive years within the last eight.

To qualify as a “first-time home buyer” the purchaser or his/her spouse may not have owned a residence during the three years prior to the purchase.

If you or your client purchased a home between January 1, 2009 and November 6, 2009, please see: 2009 First-Time Home Buyer Tax Credit.

Which Properties Are Eligible?

The Extended Home Buyer Tax Credit may be applied to primary residences, including: single-family homes, condos, townhomes, and co-ops.

How Much Is Available?

The maximum allowable credit for first-time home buyers is $8,000.

The maximum allowable credit for current homeowners is $6,500.

How is a Buyer’s Credit Amount Determined?

Each home buyer’s tax credit is determined by two additional factors:

1. The price of the home.
2. The buyer’s income.

Price

Under the Extended Home Buyer Tax Credit, credit may only be awarded on homes purchased for $800,000 or less.

Buyer Income

Under the Extended Home Buyer Tax Credit, which is effective on November 7, 2009,  single buyers with incomes up to $125,000 and married couples with incomes up to $225,000—may receive the maximum tax credit.

These income limits have changed from the 2009 First-Time Home Buyer Tax Credit limits. If you or your client purchased a home between January 1, 2009 and November 6, 2009, please see 2009 First-Time Home Buyer Tax Credit.

If the Buyer(s)’ Income Exceeds These Limits, Can He/She Still Get a Credit?

Yes, some buyers may still be eligible for the credit.

The credit decreases for buyers who earn between $125,000 and $145,000 for single buyers and between $225,000 and $245,000 for home buyers filing jointly. The amount of the tax credit decreases as his/her income approaches the maximum limit. Home buyers earning more than the maximum qualifying income—over $145,000 for singles and over $245,000 for couples are not eligible for the credit.

Can a Buyer Still Qualify If He/She Closes After April 30, 2010?

Under the Extended Home Buyer Tax Credit, as long as a written binding contract to purchase is in effect on April 30, 2010, the purchaser will have until July 1, 2010 to close.

Will the Tax Credit Need to Be Repaid?

No. The buyer does not need to repay the tax credit, if he/she occupies the home for three years or more. However, if the property is sold during this three-year period, the full amount credit will be recouped on the sale.

Information obtained from the National Association of REALTORS

Bette was asked to be a member of the board of directors of Rehoboth Beach Main Street from its beginning in 1995.  She served as Treasurer for several years and heen an active board member for many more.  In the formative years of Rehoboth Beach Main Street, Bette was very influential in educating business owners on the value of The Rehoboth Beach Main Street Organization and encouraged membership from those who were skeptical.  Most folks didn’t realize that RBMS was focused on enhancinig the ”downtown” Rehoboth business climate and didn’t see the need for another organization.  As is evident when we look outside these doors, we all realize the positive impact that RBMS has made on our city.   Bette was also a great help in influencing business owners to upgrade their outdoor signage to enhance Rehoboth streetscapes. 

Bette was able to have this impact on our vibrant business community and the city because she and Sal have played an active role in the community for over 30 years.  Although Prudential Gallo, REALTORS is celebrating their 30th year in business this year, Bette’s Rehoboth Beach business experience goes back to 1973.  She and Sal created many “firsts” in our beach community!  They introduced “subs” to the area when they opened The Yellow Submarine in the ocean block “Rehoboth Mall” on Rehoboth Avenue.  As is true for all of their businesses, the Yellow Submarine was truly a family affair . . . all the kids pitched in and even Sal’s mother made the home-made cannolis  . . . another “first” for the beach resort!  Always thinking ahead, Bette and Sal then opened the “L & S” Clothing Outlet, a pre-curser to our Outlet Stores, selling manufacturer overstocks! in the years following, they also ran an ice-cream shop, a jewelry store and were partners in creating The California Sunshine Shops  . . . all of which they which they gave up when they opened “Gallo Realty” and began focusing on Real Estate in 1979.

With experience in all types of resort businesses, it was natural that Bette’s niche turned out to be commercial leasing and sales in downtown Rehoboth.    She became the “Go To” person for anyone thinking of buying, selling or leasing in Rehoboth Beach.   With many years of successful businesses under her belt, Bette knew what worked and what didn’t.  It was, and is, general knowledge in the business community that as a REALTOR, Bette can be trusted to give you the straight scoop!  Her purpose is never to “make the commission”, but to make sure that her customers and clients are successful in their endeavor.  Bette has probably talked more would-be business or property owners out of leasing or buying than she’s assisted in “writing the lease or contract!”  She truly believes that filling downtown Rehoboth’s streets with viable & successful businesses and restaurants is what makes our city a place that people want to visit, live and work.

Although not a native, she spent every summer in Rehoboth Beach as a child and could call no other place home.  She and her family are very visible supporters of all types of organizations in Rehoboth Beach and the surrounding resort.  Here are just a few ways that Bette and her family and firm positively impact our resort region: 

• Prudential Gallo is part of the Adopt-A-Beach program and the firm regularly cleans the beach from Rehoboth Avenue to the Henlopen Hotel
• Regulary financially supports:  Beebe Hospital, RBMS events like the annual Fireworks display, St. Edmunds Church, the Rehoboth YMCA, Sussex County Association of REALTORS Annual Auction which benefits hundreds of needy children in our city and county, The Rehoboth Summer Children’s Theatre, The Rehoboth Beach Film Festival, Comedy at the Beach, The Children’s Beach House, The Lower Delaware Autism Foundation, Meals on Wheels, Taste the Fruit of the Vine Fundraiser, The Special Olympics Polar Bear Plunge
• Financially supported capital campaigns for Beebe Medical Center, The Rehoboth Beach Museum, CAMP Rehoboth, Lewes Canalfront Park

The First State is one of the tax-friendliest states for retirees. It has no sales tax. Its income-tax rates are modest. Social Security benefits are exempt from state income taxes, and taxpayers 60 and older may also exclude $12,500 of investment and qualified pension income, including out-of-state government pensions. Homeowners 65 and older may get a real estate credit equal to half of the school property tax, up to $500.

STATE SALES TAX
None, although the state collects a gross receipts tax of 1.92%.

INCOME-TAX RANGE
2.2% – 5.95%. For 2010, the state has increased the top marginal tax rate to 6.95% on income over $60,000.

EXEMPTIONS FOR RETIREMENT INCOME
Social Security and Railroad Retirement benefits are exempt. Taxpayers 60 and older can exclude $12,500 of investment and qualified pension income. They may qualify for an additional tax credit of $110. Out-of-state government pensions qualify for the pension and retirement exemption. Under age 60, $2,000 is exempt. If you are 65 or older on December 31, you are eligible for an additional standard deduction of $2,500 (if you do not itemize).

PROPERTY TAXES
All real property in the state is subject to tax unless specifically exempt. Personal property, tangible and intangible property is exempt. Real estate is subject to county, school district, vocational school district and municipal property taxes. The state offers various property tax relief programs for residents age 65 and older and for residents with disabilities. Homeowners 65 and older can get a credit equal to half of the school property taxes, up to $500.

INHERITANCE AND ESTATE TAXES
In July 2005 the legislature eliminated the requirement to file a Delaware estate tax return for dates on which the federal estate tax law does not allow a credit for state death tax (currently 2005 through 2010). It also eliminated the special lien on the gross estate tax if the decedent dies on a date on which the federal estate tax does not allow credit for state death taxes paid.

State tax data courtesy Retirement Living Information Center. Visit RetirementLiving.com for a complete rundown of taxes in Delaware.