The Anna Maria Island Sun Newspaper

Vol. 13 No. 27 - April 17, 2013


Bimini Cove waits for the word

Anna Maria Island Sun News Story

tom vaught | sun
A new sign stands in the entrance to what was originally
planned to be Villa Rosa in a one block square
of canalfront homesites.

ANNA MARIA – One of the victims of the bad economy on Anna Maria Island was Villa Rosa, a full city block of home sites bordered by canals on three sides and South Bay Boulevard on the other. It stood for years with one unoccupied luxury home finished.

As the economy started to recover in the past year, Murray Realty of Sarasota, took over the property, hoping to develop the lots into luxury homes. The city’s attempt to stop the proliferation of ground-level homes being torn down and new structures being built for use as rental properties put a hitch in their plans, but owner John Murray said they have been in touch with Anna Maria Building Official Bob Welch about whether their project would be derailed and he indicated the homes they have planned would be allowable when the moratorium is retracted.

“We have plans finalized for a model home, and it does not fall under the new regulations,” he said. “The fact that our new home designs fit the parameters of the types of homes the city commission appears to want tells you something.” he said, indicating the homes are not too large for the size limits that were adopted.

Murray is offering 14 canal front lots ranging from $399,900 to $487,900 and several floor plans ranging from 2,750 to 3,200 square feet, but they are not limiting their offerings to that.

“Because we are a custom home builder, we can offer any kind of design a homeowner might want,” he said, “as long as they fit what the city’s regulations allow.”

Each of the lots will have the ability to have a dock onto a canal, making them perfect for people looking for luxury homes. Bimini Cove will have a homeowner’s association to take care of the public areas, Murray said.

“There appears to be a demand for these types of homes,” he said. “We believe this is a perfect niche market for the Island.”

Murray recently met with 10 local Realtors and showed them the plans. He said they got an enthusiastic reaction. Murray said they hope to have the model home and sales office going by Thanksgiving of this year.

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Anna Maria Island Sun News Story

Reverse mortgage land mines

Investment Corner

This last weekend I saw former Sen. Fred Thompson promoting reverse mortgages in a TV commercial. About a decade ago I wrote here in The Sun about “Reverse Mortgages,” which are a vehicle that can be used by seniors to convert the equity in their primary residence to an income stream by borrowing against that very equity. My conclusion was that this vehicle should not be used unless the homeowner had no other solution to generate income to support their lifestyle, with the negatives being the very high fees to establish the reverse mortgage and the eventual end to the income source when the equity value was fully tapped.

A lot has changed since the time that article appeared in 2003. The residential housing collapse which began in 2007 caused the banks involved in reverse mortgages to take large losses as the equity value they loaned to seniors evaporated. Bank of America, Wells Fargo and Met Life have all exited the reverse mortgage market and are no longer writing loans. Their exit has paved the way for dozens of smaller, potentially less savory firms to come into the market and create danger for homeowners.

First, let’s review the concept of a reverse mortgage. A reverse mortgage allows you to receive either a lump sum or monthly distributions, which essentially amount to borrowing a portion of the equity in your home and using the money for whatever you desire. The company underwriting the reverse mortgage charges interest on the amount borrowed, but unlike a traditional home equity loan, no monthly repayment of principal and interest is required.

The amount borrowed and the accrued interest continues to accumulate until you sell or no longer live in the home. At the time the home is sold, the reverse mortgage balance paid off. While in the home, the homeowner is still responsible for maintenance, taxes and insurance on the home.

To take advantage of a reverse mortgage all owners of the home must be at least 62 years of age, and the home must be your principal residence. Because of the up-front origination fees you should only consider a reverse mortgage if you plan on living in the home for at least five years. Also, there cannot be any other mortgages on the property. Any small remaining mortgage balances can be paid off using funds from the reverse mortgage.

I suggest visiting to learn more about the concept of reverse mortgages and to learn about lenders active in our area. I think it is important to be careful about selecting a lender, as stories are emerging about some seniors losing their homes because one spouse was not added to the reverse mortgage deed, and had no rights to the home when the other spouse passed away.

Normally, under a proper reverse mortgage arrangement, a homeowner should never be forced from their home, assuming of course they can continue to pay the taxes and insurance which is their obligation under the reverse mortgage arrangement. Retaining an attorney to review the reverse mortgage documents would be a good idea. I still consider the reverse mortgage as a last resort, and advise you to proceed with caution in selecting a lender if you decide to proceed.

Tom Breiter is president of Breiter Capital Management, Inc., an Anna Maria based investment advisor. He can be reached at 778-1900. Some of the investment concepts highlighted in this column may carry the risk of loss of principal, and investors should determine appropriateness for their personal situation before investing. Visit


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