When state and Chelsea officials converge at 88 Gerrish Ave. on Wednesday it will be to help celebrate the opening next month of 53 loft-style apartments in a converted mill complex. But the ribbon-cutting ceremony will also be an occasion to mark the progress of a four-year effort to create the Box District, a mixed-income residential neighborhood in an area formerly made up of mostly vacant factory buildings.
Atlas Lofts, the new development, is the latest result of that multi-phased initiative the city is pursuing in partnership with the nonprofit Chelsea Neighborhood Developers and Mitchell Properties, the Boston firm that built Atlas Lofts.
Other results include 67 new housing units through two projects carried out by Neighborhood Developers, extensive improvements to public facilities, and what the group calls an emerging sense of community in the area.
So named because some of its old factories manufactured boxes, the Box District is bounded by Gerrish Avenue on the north, Library Street to the south, Broadway on the west, and Willow Street to the east.
“I’m thrilled,’’ City Manager Jay Ash said of the progress of the Box District venture. “For as long as I can remember, people were talking about this area and trying to decide whether this neighborhood should be industrial or residential.’’
Having chosen the latter course, the city lined up partners and “together we’ve figured out how to convert it to something that we have dreamed about,’’ he said. “It’s coming out better than we could have dreamed.’’
Ann Houston, executive director of the Neighborhood Developers group, recalled that when the venture began in 2006, “the Box District was an area that for all intents and purposes had died.’’ She said the fact that 60 percent of the Atlas Lofts units had been rented by this past week — two weeks before its scheduled opening — “signals that we’ve been pretty successful in creating a desirable new neighborhood.’’
David Traggorth, director of development for Mitchell Properties, said the company has been “pleasantly surprised’’ at how quickly its units are being leased.
Saturday, July 31, 2010
Friday, July 30, 2010
JUST FOR FUN: Slow Down
"Philip Heron and James Adair shot a bunch of stuff hitting other stuff and slowed the whole thing way, way down.
"Tempus II from Philip Heron on Vimeo.
MORTGAGE & FINANCE: Low mortgage rates spur refinancings
NEW YORK — The lowest mortgage rates in decades are just too good for some people to pass up.
Brokers are reporting rising interest in home refinancings as rates on a 30-year fixed loans have hit record lows in four of the past five weeks. This week the average rate fell to 4.56 percent, the lowest since mortgage company Freddie Mac began tracking rates in 1971.
Weekly applications to refinance home loans have nearly doubled in July from April, according to the Mortgage Bankers Association.
Refinancing a home loan often requires the homeowner to pay thousands of dollars in closing costs. Many people either don’t have the money, or they can’t qualify for a loan. And rates have been low for such a long time that many people may have already refinanced. It is not in their interest to do so again to save a little bit more on monthly payments.
The last time home loan rates were lower was during the 1950s, when most mortgages lasted just 20 or 25 years.
And it’s not just 30-year fixed loans. The rate on the 15-year fixed loan, a popular choice for refinancing, dropped to 4.03 percent from 4.06 percent last week. That was the lowest on records dating back to 1991.
Associated Press July 23, 2010
Brokers are reporting rising interest in home refinancings as rates on a 30-year fixed loans have hit record lows in four of the past five weeks. This week the average rate fell to 4.56 percent, the lowest since mortgage company Freddie Mac began tracking rates in 1971.
Weekly applications to refinance home loans have nearly doubled in July from April, according to the Mortgage Bankers Association.
Refinancing a home loan often requires the homeowner to pay thousands of dollars in closing costs. Many people either don’t have the money, or they can’t qualify for a loan. And rates have been low for such a long time that many people may have already refinanced. It is not in their interest to do so again to save a little bit more on monthly payments.
The last time home loan rates were lower was during the 1950s, when most mortgages lasted just 20 or 25 years.
And it’s not just 30-year fixed loans. The rate on the 15-year fixed loan, a popular choice for refinancing, dropped to 4.03 percent from 4.06 percent last week. That was the lowest on records dating back to 1991.
Associated Press July 23, 2010
Thursday, July 29, 2010
MARKET TRENDS: As 55-and-over housing demand wanes, builders adjust
It seemed like a good idea a decade ago: Build 30 condominiums in downtown Northborough just for people ages 55 and over. No children, no new teachers to pay, no new problems for the town.
But years later, Laurence Place stood vacant and half-finished. Despite efforts by several developers, the project wasn’t flying in a real estate market increasingly saturated with senior housing. With years wasted and an eyesore in the center of town, Northborough officials and residents decided to take action.
Developer Peter Burke tours one of the units nearing completion in Northborough after age limits were dropped; a marker still bears its original name. (Josh Reynolds for The Boston Globe)
This fall, thanks to a change in the zoning bylaws, the first units are expected to open under a new name — Laurence Falls — and without the ban on children.
“The old model hasn’t proven successful in today’s changing housing market,’’ said town planner Kathy Joubert. “And we decided that for us in Northborough, from a zoning perspective, the age of our residents shouldn’t make a difference to us as a town.’’
This was not a decision reached lightly. Only after 18 months of discussion, the creation of a special zoning subcommittee, and a heated Town Meeting debate last year did the revised zoning bylaw win approval.
Previously, multifamily housing was only allowed in town under affordable- housing guidelines or the senior residential overlay district bylaw, which re stricted the age of buyers to 55 and up. The new bylaw allows multifamily housing for all ages in certain downtown neighborhoods and along Route 20.
“We see it as a step in the right direction . . . to develop the center of town into a more vibrant place,’’ said Planning Board chairman Rick Leif.
Similar efforts have failed in other communities. Two years ago, Hudson officials refused to loosen age restrictions on a struggling 55-and-over project, saying the change would be unfair for residents who had already bought units. Not long before that, Wellesley had resisted efforts by a developer to backpedal on age limits.
But with more developers abandoning 55-and-over projects before construction even begins, Northborough’s decision is being watched closely by the real estate world.
Most such projects were built after 2000, as developers foresaw a surge in demand as baby boomers began to retire. And many towns embraced the concept as a way to add newcomers — and new property taxes — without burdening public schools with the additional costs that new students would bring.
Developer Peter Burke tours one of the units nearing completion in Northborough after age limits were dropped; a marker still bears its original name. (Josh Reynolds for The Boston Globe)
This fall, thanks to a change in the zoning bylaws, the first units are expected to open under a new name — Laurence Falls — and without the ban on children.
“The old model hasn’t proven successful in today’s changing housing market,’’ said town planner Kathy Joubert. “And we decided that for us in Northborough, from a zoning perspective, the age of our residents shouldn’t make a difference to us as a town.’’
This was not a decision reached lightly. Only after 18 months of discussion, the creation of a special zoning subcommittee, and a heated Town Meeting debate last year did the revised zoning bylaw win approval.
Previously, multifamily housing was only allowed in town under affordable- housing guidelines or the senior residential overlay district bylaw, which re stricted the age of buyers to 55 and up. The new bylaw allows multifamily housing for all ages in certain downtown neighborhoods and along Route 20.
“We see it as a step in the right direction . . . to develop the center of town into a more vibrant place,’’ said Planning Board chairman Rick Leif.
Similar efforts have failed in other communities. Two years ago, Hudson officials refused to loosen age restrictions on a struggling 55-and-over project, saying the change would be unfair for residents who had already bought units. Not long before that, Wellesley had resisted efforts by a developer to backpedal on age limits.
But with more developers abandoning 55-and-over projects before construction even begins, Northborough’s decision is being watched closely by the real estate world.
Most such projects were built after 2000, as developers foresaw a surge in demand as baby boomers began to retire. And many towns embraced the concept as a way to add newcomers — and new property taxes — without burdening public schools with the additional costs that new students would bring.
Wednesday, July 28, 2010
LOCAL NEWS: Fort Point building plan scaled back
Archon/Goldman Properties latest version of the plan for 319 A St. rear is a 21-story building with 184 rental apartments and four levels of above-ground parking. It previously had wanted to build a 25-story building with 232 apartments.
The building will replace a five-story warehouse currently used as artists’ work space. After consultation with city planners, Archon/Goldman opted to market the units as modestly appointed apartments attractive to young professionals or graduate students.
“The goal has always been to create something that is affordable and can also get developed,’’ said John Matteson, regional director for Archon Group, which is working with Goldman Properties in the joint venture. “We want a building that young professionals can live in.’’
The city is trying to lure younger residents to the Fort Point neighborhood as part of a broader effort to create a so-called innovation district, with technology and medical firms that typically employ large numbers of students and younger researchers. Matteson said 15 percent of the units will be set aside for affordable housing.
Archon/Goldman said it is still considering a version of the plan that would include 20 studio units built around shared kitchens, living rooms, and laundry facilities.
The plan needs approval from the Boston Redevelopment Authority. Construction would begin in 2012.
Casey Ross Boston Globe July 22, 2010
Saturday, July 24, 2010
MARKET TRENDS: Homes Getting Smaller and Other Trends
July 09—Two new sets of research provide plenty of insight about how we’ve gotten used to living and also offer a glimpse of what we might want next.
The first set of findings, released this month by the Department of Housing and Urban Development, shows most American households have gotten downright comfortable—that is, except for the 1 percent of homes that don’t have indoor plumbing.
There is a cautionary note contained in the 2009 American Housing Survey, however. Only 36 percent of U.S. homes have a working carbon monoxide detector.
Government researchers also found the median home size was 1,500 square feet, compared with 1,610 square feet in 1973, and the lot size for single-family homes is down from a median of 0.36 acres in 1973 to 0.27 acres last year.
People are packing a lot of amenities into their living space. Most homes have at least six rooms and three or more bedrooms, and 51 percent of homes have two or more bathrooms. Back in 1973, the first year the government conducted the survey on the nation’s housing stock, 19 percent of homes had at least two bathrooms.
Amenities that most homes have include a dishwasher, 66 percent; a washing machine and clothes dryer, both 80-plus percent; and central air conditioning, 65 percent. In 1973, 17 percent of homes had central air.
Most of the increases in the number of bedrooms and bathrooms were the impact of homes built in the past few years. Is it the McMansion effect?
If it is, that’s waning, at least temporarily. Recently released U.S. Census Bureau research showed that single-family homes built in 2009 were almost 100 square feet smaller than two years earlier.
That’s not too surprising, given builders’ efforts to market less expensive homes during the economic downturn to consumers concerned about mortgage payments and energy costs.
But here’s a fun fact: Square footage comes and goes, but the attraction of stairs may be on the wane. For the past two years, ranch homes have been gaining in popularity, and last year they accounted for 47 percent of new single-family homes.
Don’t necessarily attribute the change to a difficult economy, although that’s likely responsible for last year’s lack of interest in building homes with four bedrooms and three bathrooms. Single-story homes can be more expensive to build than two-story houses because of the extra costs of a larger concrete foundation and roof. Credit some of the shift to baby boomers who want homes in which they can age gracefully.
Ronald Olen and his wife, Joan, lived in a four-story Colonial in Arlington Heights for years. Now, with their children grown, they’ve sold their home and moved into an apartment while they wait for their new ranch to be built in McHenry.
There wasn’t much discussion about what kind of home to downsize to, Ronald Olen said.
“We wanted everything on the same floor, no stairs,” he explained. “We’re getting older is what it amounts to. Lugging things up and down the stairs, we thought we really don’t need this. We’ll be better able to cope with day-to-day activities.”
Lynda Conkel, director of sales and marketing at Gerstad Builders, which is building the Olens’ home, said boomers are fueling part of the increased interest in ranches, but she thinks there’s more to it. Single and younger married buyers also like the idea of no stairs, she said, particularly because contemporary home designs are placing master bedroom suites away from other bedrooms.
“Very few people come in looking for a ranch and leave with a two-story,” Conkel said. “People do come in and say we’re looking (to) move, and some of them did come in saying they wanted a two-story and leave with a ranch.”
Maybe it’s a case of something old is new again, or maybe, both in terms of square footage and number of floors, it’s a case of what goes up, must come down.
Back in 1973, when the Census Bureau first began tracking details on single-family home construction, 67 percent of homes completed that year had one story.
By Mary Ellen Podmolik, Chicago Tribune July 9, 2010
There is a cautionary note contained in the 2009 American Housing Survey, however. Only 36 percent of U.S. homes have a working carbon monoxide detector.
Government researchers also found the median home size was 1,500 square feet, compared with 1,610 square feet in 1973, and the lot size for single-family homes is down from a median of 0.36 acres in 1973 to 0.27 acres last year.
People are packing a lot of amenities into their living space. Most homes have at least six rooms and three or more bedrooms, and 51 percent of homes have two or more bathrooms. Back in 1973, the first year the government conducted the survey on the nation’s housing stock, 19 percent of homes had at least two bathrooms.
Amenities that most homes have include a dishwasher, 66 percent; a washing machine and clothes dryer, both 80-plus percent; and central air conditioning, 65 percent. In 1973, 17 percent of homes had central air.
Most of the increases in the number of bedrooms and bathrooms were the impact of homes built in the past few years. Is it the McMansion effect?
If it is, that’s waning, at least temporarily. Recently released U.S. Census Bureau research showed that single-family homes built in 2009 were almost 100 square feet smaller than two years earlier.
That’s not too surprising, given builders’ efforts to market less expensive homes during the economic downturn to consumers concerned about mortgage payments and energy costs.
But here’s a fun fact: Square footage comes and goes, but the attraction of stairs may be on the wane. For the past two years, ranch homes have been gaining in popularity, and last year they accounted for 47 percent of new single-family homes.
Don’t necessarily attribute the change to a difficult economy, although that’s likely responsible for last year’s lack of interest in building homes with four bedrooms and three bathrooms. Single-story homes can be more expensive to build than two-story houses because of the extra costs of a larger concrete foundation and roof. Credit some of the shift to baby boomers who want homes in which they can age gracefully.
Ronald Olen and his wife, Joan, lived in a four-story Colonial in Arlington Heights for years. Now, with their children grown, they’ve sold their home and moved into an apartment while they wait for their new ranch to be built in McHenry.
There wasn’t much discussion about what kind of home to downsize to, Ronald Olen said.
“We wanted everything on the same floor, no stairs,” he explained. “We’re getting older is what it amounts to. Lugging things up and down the stairs, we thought we really don’t need this. We’ll be better able to cope with day-to-day activities.”
Lynda Conkel, director of sales and marketing at Gerstad Builders, which is building the Olens’ home, said boomers are fueling part of the increased interest in ranches, but she thinks there’s more to it. Single and younger married buyers also like the idea of no stairs, she said, particularly because contemporary home designs are placing master bedroom suites away from other bedrooms.
“Very few people come in looking for a ranch and leave with a two-story,” Conkel said. “People do come in and say we’re looking (to) move, and some of them did come in saying they wanted a two-story and leave with a ranch.”
Maybe it’s a case of something old is new again, or maybe, both in terms of square footage and number of floors, it’s a case of what goes up, must come down.
Back in 1973, when the Census Bureau first began tracking details on single-family home construction, 67 percent of homes completed that year had one story.
By Mary Ellen Podmolik, Chicago Tribune July 9, 2010
Friday, July 23, 2010
CONDOS: Some Home Owner Associations (HOAs) Sue or Foreclose to Collect Dues
July 11—When Helen Burgess fell behind on her bills after being diagnosed with cancer, she was able to work out payment plans on her mortgage, car note, credit card, and tax obligations to the Internal Revenue Service.
Her neighbors weren’t so accommodating.
Because Burgess was late on her condo fees, the Magnolia Lane Condominium Association cut off her water soon after she returned home from surgery. That was June 27, 2009.
Since then, Burgess has been hauling water from her niece’s house 10 miles away. The condo group also tried in vain to garnish the Marietta woman’s pay to collect the dues it’s owed, which, including attorneys’ fees, now totals more than $5,000. Most recently, it banned Burgess or her guests from using the clubhouse and other facilities in the 76-unit Marietta community.
“This is the craziest mess I’ve ever had to deal with. It’s been an ordeal,” said Burgess, 59, who has been unable to reach a financial agreement with the association. She even asked her pastor to intervene. It didn’t help.
The condo association and its attorney declined to discuss Burgess’ situation, other than to say they are “trying to work with her.”
While Burgess’ treatment may seem harsh, she’s more fortunate than some homeowners in similar situations. Some who have fallen behind on homeowners association fees—despite being current on their mortgages—have been sent into foreclosure by associations determined to collect.
Georgia is one of about 30 states where HOAs are empowered to take such drastic action. Though solid data on the trend is not available, by all accounts, such foreclosures—and other get-tough tactics—have occurred more often during this recession than in previous downturns.
HOA representatives say such actions are not taken lightly, and that they often have no other means to recoup fees that can quickly add up to thousands of dollars. In HOAs where not enough members are making payments, an association can quickly find itself verging on failure.
But for individual homeowners like Burgess, who says she has repeatedly tried to work out a repayment plan, such actions are disheartening.
“Going through this is more frightening than when I went through breast cancer,” she said.
Usually a last resort
The issue of HOA-initiated foreclosures garnered national attention recently when Army Capt. Michael Clauer returned to Texas from a tour of duty in Iraq to find that the $300,000 four-bedroom he owned free and clear had been sold on the courthouse steps after his wife missed two HOA payments.
The house was sold for $3,500, just enough to pay the delinquent dues and legal fees, then resold by the new owner for $135,000. A Las Vegas couple temporarily lost their home over an $81 association fee debt.
In Georgia, homeowner and condo associations can foreclose on members’ homes if they are more than $2,000 behind on their dues.
Bank-initiated foreclosures in Georgia can mean a home is sold at auction within 37 days. Associations, however, must file a lawsuit to start proceedings, which can take anywhere from four months to over a year.
For HOAs, foreclosures are a last resort, said Doug Goldin of Marietta, attorney for Magnolia Lane. “Most don’t want to go down that road because of the cost and what you’re doing to families,” he said.
Associations that do pursue foreclosure can wind up collecting a fraction of what is owed. So why do it?
“You can rack up $15,000 to $20,000” in overdue association fees, Goldin said. “Generally, the best route is to do the foreclosure. So you can get a new homeowner in and they may pay better than the last.”
In many states, including Georgia, HOAs have a wide range of alternatives to draw on. With a court’s permission, they can attach liens or garnish wages and bank accounts. They can also, as in Burgess’ case, shut off a homeowner’s water and block use of association amenities.
But even associations willing to work with a struggling homeowner can find themselves losing out if a bank steps in to foreclose on a homeowner first. So, many circumvent such problems by going to court. In Cobb County Superior Court alone, there are dozens of cases of associations that have attached liens against or are suing residents.
HOAs feel threat
Officials with homeowners and condo groups say they sometimes have to take tough actions to protect their interests.
It’s one thing when a resident is sick or has lost a job and can’t pay. It’s another when the resident who hasn’t paid in months installs granite countertops in the kitchen.
“We’re the last consideration and that’s not fair. We shouldn’t come after HBO [cable TV payments],” said John McCosh, secretary of the South Prado Unit Owners Association, a 23-condo complex in Ansley Park.
Earlier this year, his association adopted a no-exceptions policy after dealing with several delinquent homeowners, including one whose bill amounted to nearly 10 percent of the association’s budget. That person is now an international fugitive.
There are an estimated 10,000 to 15,000 association-run communities in metro Atlanta alone. About one-fifth of the U.S. population lives in HOA communities. That number grew substantially in the past 20 years as more homeowners sought communities offering all-inclusive amenities.
With those amenities came obligations once handled by cities and counties, such as road maintenance, in addition to landscaping, pool care, water bills, insurance, and capital improvements.
HOAs rely heavily on member dues to run the properties and cover major repairs and improvements.
Her neighbors weren’t so accommodating.
Because Burgess was late on her condo fees, the Magnolia Lane Condominium Association cut off her water soon after she returned home from surgery. That was June 27, 2009.
Since then, Burgess has been hauling water from her niece’s house 10 miles away. The condo group also tried in vain to garnish the Marietta woman’s pay to collect the dues it’s owed, which, including attorneys’ fees, now totals more than $5,000. Most recently, it banned Burgess or her guests from using the clubhouse and other facilities in the 76-unit Marietta community.
“This is the craziest mess I’ve ever had to deal with. It’s been an ordeal,” said Burgess, 59, who has been unable to reach a financial agreement with the association. She even asked her pastor to intervene. It didn’t help.
The condo association and its attorney declined to discuss Burgess’ situation, other than to say they are “trying to work with her.”
While Burgess’ treatment may seem harsh, she’s more fortunate than some homeowners in similar situations. Some who have fallen behind on homeowners association fees—despite being current on their mortgages—have been sent into foreclosure by associations determined to collect.
Georgia is one of about 30 states where HOAs are empowered to take such drastic action. Though solid data on the trend is not available, by all accounts, such foreclosures—and other get-tough tactics—have occurred more often during this recession than in previous downturns.
HOA representatives say such actions are not taken lightly, and that they often have no other means to recoup fees that can quickly add up to thousands of dollars. In HOAs where not enough members are making payments, an association can quickly find itself verging on failure.
But for individual homeowners like Burgess, who says she has repeatedly tried to work out a repayment plan, such actions are disheartening.
“Going through this is more frightening than when I went through breast cancer,” she said.
Usually a last resort
The issue of HOA-initiated foreclosures garnered national attention recently when Army Capt. Michael Clauer returned to Texas from a tour of duty in Iraq to find that the $300,000 four-bedroom he owned free and clear had been sold on the courthouse steps after his wife missed two HOA payments.
The house was sold for $3,500, just enough to pay the delinquent dues and legal fees, then resold by the new owner for $135,000. A Las Vegas couple temporarily lost their home over an $81 association fee debt.
In Georgia, homeowner and condo associations can foreclose on members’ homes if they are more than $2,000 behind on their dues.
Bank-initiated foreclosures in Georgia can mean a home is sold at auction within 37 days. Associations, however, must file a lawsuit to start proceedings, which can take anywhere from four months to over a year.
For HOAs, foreclosures are a last resort, said Doug Goldin of Marietta, attorney for Magnolia Lane. “Most don’t want to go down that road because of the cost and what you’re doing to families,” he said.
Associations that do pursue foreclosure can wind up collecting a fraction of what is owed. So why do it?
“You can rack up $15,000 to $20,000” in overdue association fees, Goldin said. “Generally, the best route is to do the foreclosure. So you can get a new homeowner in and they may pay better than the last.”
In many states, including Georgia, HOAs have a wide range of alternatives to draw on. With a court’s permission, they can attach liens or garnish wages and bank accounts. They can also, as in Burgess’ case, shut off a homeowner’s water and block use of association amenities.
But even associations willing to work with a struggling homeowner can find themselves losing out if a bank steps in to foreclose on a homeowner first. So, many circumvent such problems by going to court. In Cobb County Superior Court alone, there are dozens of cases of associations that have attached liens against or are suing residents.
HOAs feel threat
Officials with homeowners and condo groups say they sometimes have to take tough actions to protect their interests.
It’s one thing when a resident is sick or has lost a job and can’t pay. It’s another when the resident who hasn’t paid in months installs granite countertops in the kitchen.
“We’re the last consideration and that’s not fair. We shouldn’t come after HBO [cable TV payments],” said John McCosh, secretary of the South Prado Unit Owners Association, a 23-condo complex in Ansley Park.
Earlier this year, his association adopted a no-exceptions policy after dealing with several delinquent homeowners, including one whose bill amounted to nearly 10 percent of the association’s budget. That person is now an international fugitive.
There are an estimated 10,000 to 15,000 association-run communities in metro Atlanta alone. About one-fifth of the U.S. population lives in HOA communities. That number grew substantially in the past 20 years as more homeowners sought communities offering all-inclusive amenities.
With those amenities came obligations once handled by cities and counties, such as road maintenance, in addition to landscaping, pool care, water bills, insurance, and capital improvements.
HOAs rely heavily on member dues to run the properties and cover major repairs and improvements.
Thursday, July 22, 2010
NEWS: Fannie Mae Makes Appraisal Changes
Fannie Mae has changed home appraisal rules that were troubling homeowners and homebuyers.
The mortgage market giant has instructed lenders to use only appraisers who know the local market and to consider whether short sales and foreclosures are really comparable to non-distressed home sales.
In another change, Fannie Mae said lending officials can’t just decrease a value the appraiser sets for your home. If the lender thinks the appraiser has over-valued your home, it can to either order a review of the appraisal or ask for a completely new appraisal. In some markets, mortgage underwriters were adjusting home values downward themselves rather than using the appraiser’s value.
If an appraiser uses a short sale or foreclosure to value your home, he’ll now have to identify that comparable as a distressed sale and consider any differences between your home and the distressed sale home. Appraisers cannot just assume the properties are equal, the new rules say.
Fannie Mae also made it clear that appraisers are allowed to talk to REALTORS®. Previously, lenders were refusing to allow REALTORS® to talk to appraisers about comparable properties. While it’s still up to the appraiser to decide whether the comparable home sales the real estate agent comes up with are truly comparable to your home, it’s now officially okay for the appraiser to discuss those with the agent.
The changes, sought by the National Association of REALTORS® should result in more accurate appraisals when a home is bought, sold, or refinanced.
By Dona DeZube, HouseLogic News Editor July 14, 2010
The mortgage market giant has instructed lenders to use only appraisers who know the local market and to consider whether short sales and foreclosures are really comparable to non-distressed home sales.
In another change, Fannie Mae said lending officials can’t just decrease a value the appraiser sets for your home. If the lender thinks the appraiser has over-valued your home, it can to either order a review of the appraisal or ask for a completely new appraisal. In some markets, mortgage underwriters were adjusting home values downward themselves rather than using the appraiser’s value.
If an appraiser uses a short sale or foreclosure to value your home, he’ll now have to identify that comparable as a distressed sale and consider any differences between your home and the distressed sale home. Appraisers cannot just assume the properties are equal, the new rules say.
Fannie Mae also made it clear that appraisers are allowed to talk to REALTORS®. Previously, lenders were refusing to allow REALTORS® to talk to appraisers about comparable properties. While it’s still up to the appraiser to decide whether the comparable home sales the real estate agent comes up with are truly comparable to your home, it’s now officially okay for the appraiser to discuss those with the agent.
The changes, sought by the National Association of REALTORS® should result in more accurate appraisals when a home is bought, sold, or refinanced.
By Dona DeZube, HouseLogic News Editor July 14, 2010
Wednesday, July 21, 2010
FINANCE: More Americans’ Credit Scores Sink to New Lows
NEW YORK—The credit scores of millions more Americans are sinking to new lows.
Figures provided by FICO Inc. show that 25.5 percent of consumers—nearly 43.4 million people—now have a credit score of 599 or below, marking them as poor risks for lenders. It’s unlikely they will be able to get credit cards, auto loans, or mortgages under the tighter lending standards banks now use.
Because consumers relied so heavily on debt to fuel their spending in recent years, their restricted access to credit is one reason for the slow economic recovery.
“I don’t get paid for loan applications, I get paid for closings,” said Ritch Workman, a Melbourne, Fla., mortgage broker. “I have plenty of business, but I’m struggling to stay open.”
FICO’s latest analysis is based on consumer credit reports as of April. Its findings represent an increase of about 2.4 million people in the lowest credit score categories in the past two years. Before the Great Recession, scores on FICO’s 300-to-850 scale weren’t as volatile, said Andrew Jennings, chief research officer for FICO in Minneapolis. Historically, just 15 percent of the 170 million consumers with active credit accounts, or 25.5 million people, fell below 599, according to data posted on Myfico.com.
More are likely to join their ranks. It can take several months before payment missteps actually drive down a credit score. The Labor Department says about 26 million people are out of work or underemployed, and millions more face foreclosure, which alone can chop 150 points off an individual’s score. Once the damage is done, it could be years before this group can restore their scores, even if they had strong credit histories in the past.
On the positive side, the number of consumers who have a top score of 800 or above has increased in recent years. At least in part, this reflects that more individuals have cut spending and paid down debt in response to the recession. Their ranks now stand at 17.9 percent, which is notably above the historical average of 13 percent, though down from 18.7 percent in April 2008 before the market meltdown.
There’s also been a notable shift in the important range of people with moderate credit, those with scores between 650 and 699. The new data shows that this group comprised 11.9 percent of scores. This is down only marginally from 12 percent in 2008, but reflects a drop of roughly 5.3 million people from its historical average of 15 percent.
This group is significant because it may feel the effects of lenders’ tighter credit standards the most, said FICO’s Jennings. Consumers on the lowest end of the scale are less likely to try to borrow. However, people with mid-range scores that had been eligible for credit before the meltdown are looking to buy homes or cars but finding it hard to qualify for affordable loans.
Workman has seen this firsthand.
A customer with a score of 679 recently walked away from buying a house because he could not get the best interest rate on a $100,000 mortgage. Had his score been 680, the rate he was offered would have been a half-percent lower. The difference was only about $31 per month, but over a 30-year mortgage would have added up to more than $11,000.
“There was nothing derogatory on his credit report,” Workman said of the customer. He had, however, recently gotten an auto loan, which likely lowered his score.
Studies have shown FICO scores are generally reliable predictions of consumer payment behavior, but Workman’s experience points to one drawback of credit scoring: Lenders can’t differentiate between two people with the same score. Another consumer might have a 679 score because of several late payments, which could indicate he or she is a bigger repayment risk.
On a broader scale, some of the spike in foreclosures came about because homeowners were financially irresponsible, while others lost their jobs and could no longer pay their mortgages. Yet both reasons for foreclosures have the same impact on a borrower’s FICO score.
In the past too much credit was handed out based on scores alone, without considering how much debt consumers could pay back, said Edmund Tribue, a senior vice president in the credit risk practice at MasterCard Advisors. Now the ability to repay the debt is a critical part of the lending decision.
Workman still thinks credit scores alone play too big a role. “The pendulum has swung too far,” he said. “We absolutely swung way too far in the liberal lending, but did we have to swing so far back the other way?”
Eileen AJ Connelly House Logic July 12, 2010
Figures provided by FICO Inc. show that 25.5 percent of consumers—nearly 43.4 million people—now have a credit score of 599 or below, marking them as poor risks for lenders. It’s unlikely they will be able to get credit cards, auto loans, or mortgages under the tighter lending standards banks now use.
Because consumers relied so heavily on debt to fuel their spending in recent years, their restricted access to credit is one reason for the slow economic recovery.
“I don’t get paid for loan applications, I get paid for closings,” said Ritch Workman, a Melbourne, Fla., mortgage broker. “I have plenty of business, but I’m struggling to stay open.”
FICO’s latest analysis is based on consumer credit reports as of April. Its findings represent an increase of about 2.4 million people in the lowest credit score categories in the past two years. Before the Great Recession, scores on FICO’s 300-to-850 scale weren’t as volatile, said Andrew Jennings, chief research officer for FICO in Minneapolis. Historically, just 15 percent of the 170 million consumers with active credit accounts, or 25.5 million people, fell below 599, according to data posted on Myfico.com.
More are likely to join their ranks. It can take several months before payment missteps actually drive down a credit score. The Labor Department says about 26 million people are out of work or underemployed, and millions more face foreclosure, which alone can chop 150 points off an individual’s score. Once the damage is done, it could be years before this group can restore their scores, even if they had strong credit histories in the past.
On the positive side, the number of consumers who have a top score of 800 or above has increased in recent years. At least in part, this reflects that more individuals have cut spending and paid down debt in response to the recession. Their ranks now stand at 17.9 percent, which is notably above the historical average of 13 percent, though down from 18.7 percent in April 2008 before the market meltdown.
There’s also been a notable shift in the important range of people with moderate credit, those with scores between 650 and 699. The new data shows that this group comprised 11.9 percent of scores. This is down only marginally from 12 percent in 2008, but reflects a drop of roughly 5.3 million people from its historical average of 15 percent.
This group is significant because it may feel the effects of lenders’ tighter credit standards the most, said FICO’s Jennings. Consumers on the lowest end of the scale are less likely to try to borrow. However, people with mid-range scores that had been eligible for credit before the meltdown are looking to buy homes or cars but finding it hard to qualify for affordable loans.
Workman has seen this firsthand.
A customer with a score of 679 recently walked away from buying a house because he could not get the best interest rate on a $100,000 mortgage. Had his score been 680, the rate he was offered would have been a half-percent lower. The difference was only about $31 per month, but over a 30-year mortgage would have added up to more than $11,000.
“There was nothing derogatory on his credit report,” Workman said of the customer. He had, however, recently gotten an auto loan, which likely lowered his score.
Studies have shown FICO scores are generally reliable predictions of consumer payment behavior, but Workman’s experience points to one drawback of credit scoring: Lenders can’t differentiate between two people with the same score. Another consumer might have a 679 score because of several late payments, which could indicate he or she is a bigger repayment risk.
On a broader scale, some of the spike in foreclosures came about because homeowners were financially irresponsible, while others lost their jobs and could no longer pay their mortgages. Yet both reasons for foreclosures have the same impact on a borrower’s FICO score.
In the past too much credit was handed out based on scores alone, without considering how much debt consumers could pay back, said Edmund Tribue, a senior vice president in the credit risk practice at MasterCard Advisors. Now the ability to repay the debt is a critical part of the lending decision.
Workman still thinks credit scores alone play too big a role. “The pendulum has swung too far,” he said. “We absolutely swung way too far in the liberal lending, but did we have to swing so far back the other way?”
Eileen AJ Connelly House Logic July 12, 2010
Tuesday, July 20, 2010
MORTGAGE & FINANCE: 5 Steps to Owning a Home Again After Foreclosure
Foreclosure is just a one-time event—with discipline and perseverance, you can get a mortgage and become a homeowner again.
It won’t be easy to obtain a mortgage after foreclosure. But with enough time, discipline, and desire, you can own your own home again. Here’s what you need to do:
1. Stick with a job after foreclosure
Did you fall into foreclosure because of the lack of a steady job? If you did, the first step toward homeownership after foreclosure is finding and holding one. And if you already have one—stick with it, unless you can move to a better one. Note that potential lenders will require stable employment before they’ll give you a new mortgage loan after a foreclosure. Even if it means taking a lower-paying job, it’s worth it.
2. Rebuild your nest egg after foreclosure
Establish a safety net. Financial planners generally recommend three to six months of living expenses in a liquid account, but since you’re coming out of foreclosure, six is a minimum to show stability and that you’re able to pay your bills—including your mortgage—for an extended period if you lose your job.
3. Raise your credit score after foreclosure
This is the hardest and most time-consuming part. After foreclosure, your credit score, according to myFICO, probably dropped by about 150 points. You’ll need to raise it back up with perseverance.
Pay bills on time and keep your credit card balances below maximum levels. The foreclosure will stay on your credit report for seven years, but if you prove your money management skills have matured, it will become less of a red mark as years go by.
Tip: Consult a housing counselor. The U.S. Department of Housing and Urban Development offers free housing counseling for distressed homeowners with a foreclosure in their past. A counselor can help you with money management and budgeting. Counseling works—an evaluation of a program in Indianapolis discovered that credit scores greatly improved because of education and counseling, and increased average borrowing power by $4,500 per family.
It won’t be easy to obtain a mortgage after foreclosure. But with enough time, discipline, and desire, you can own your own home again. Here’s what you need to do:
1. Stick with a job after foreclosure
Did you fall into foreclosure because of the lack of a steady job? If you did, the first step toward homeownership after foreclosure is finding and holding one. And if you already have one—stick with it, unless you can move to a better one. Note that potential lenders will require stable employment before they’ll give you a new mortgage loan after a foreclosure. Even if it means taking a lower-paying job, it’s worth it.
2. Rebuild your nest egg after foreclosure
Establish a safety net. Financial planners generally recommend three to six months of living expenses in a liquid account, but since you’re coming out of foreclosure, six is a minimum to show stability and that you’re able to pay your bills—including your mortgage—for an extended period if you lose your job.
3. Raise your credit score after foreclosure
This is the hardest and most time-consuming part. After foreclosure, your credit score, according to myFICO, probably dropped by about 150 points. You’ll need to raise it back up with perseverance.
Pay bills on time and keep your credit card balances below maximum levels. The foreclosure will stay on your credit report for seven years, but if you prove your money management skills have matured, it will become less of a red mark as years go by.
Tip: Consult a housing counselor. The U.S. Department of Housing and Urban Development offers free housing counseling for distressed homeowners with a foreclosure in their past. A counselor can help you with money management and budgeting. Counseling works—an evaluation of a program in Indianapolis discovered that credit scores greatly improved because of education and counseling, and increased average borrowing power by $4,500 per family.
Monday, July 19, 2010
ECONOMY: Job cuts pushing more out of homes
Foreclosures up on fixed-rate loans
High unemployment is hitting home — literally — in the Merrimack Valley’s largest communities.
More long-term homeowners with “good’’ fixed-rate mortgages are facing foreclosure, likely because of job losses, according to a University of Massachusetts Lowell researcher.
The financial industry appears to have worked through much of the “bad’’ adjustable-rate mortgages from the housing bubble, many from predatory lenders, said researcher and writer Keith Vaillancourt of the university’s Center for Family, Work and Community. But a closer look at property records finds growing numbers of default notices and actual foreclosures on people who have owned their homes for a decade or even longer and have reasonable mortgage terms, he said.
“The big killer in this is unemployment or underemployment,’’ Vaillancourt said.
Housing specialists in Lawrence and Lowell agree.
“We are seeing 50 to 60 percent of our clients with traditional fixed-rate mortgages, where a year or two ago it was 95 percent with adjustable mortgages,’’ said Juan Bonilla, director of homeownership education for Lawrence Community Works.
The Community Works’ active caseload for mortgage delinquency services and counseling is close to 300 families, Bonilla said.
“We’ve been seeing families affected more and more by the poor job market, families losing income due to job loss or hours being cut or overtime being cut,’’ Bonilla said. “In some cases, families purchase their home with two jobs, it was the only way they could afford to purchase a home . . . and they’ve lost one of those jobs. It’s a vicious cycle going on.’’
A computer scan of the first 100 foreclosure cases this year at the Home Preservation Center run by Lowell’s Coalition for a Better Acre showed more than 80 percent involve a fixed-rate loan under 8 percent, said coalition executive di rector Emily Rosenbaum.
“On paper, you’d say what’s the problem?’’ Rosenbaum said. “But when you scan over to the reason they’re coming to the center, it’s all reduction of income, reduction of income, reduction of income.
High unemployment is hitting home — literally — in the Merrimack Valley’s largest communities.
More long-term homeowners with “good’’ fixed-rate mortgages are facing foreclosure, likely because of job losses, according to a University of Massachusetts Lowell researcher.
The financial industry appears to have worked through much of the “bad’’ adjustable-rate mortgages from the housing bubble, many from predatory lenders, said researcher and writer Keith Vaillancourt of the university’s Center for Family, Work and Community. But a closer look at property records finds growing numbers of default notices and actual foreclosures on people who have owned their homes for a decade or even longer and have reasonable mortgage terms, he said.
“The big killer in this is unemployment or underemployment,’’ Vaillancourt said.
Housing specialists in Lawrence and Lowell agree.
“We are seeing 50 to 60 percent of our clients with traditional fixed-rate mortgages, where a year or two ago it was 95 percent with adjustable mortgages,’’ said Juan Bonilla, director of homeownership education for Lawrence Community Works.
The Community Works’ active caseload for mortgage delinquency services and counseling is close to 300 families, Bonilla said.
“We’ve been seeing families affected more and more by the poor job market, families losing income due to job loss or hours being cut or overtime being cut,’’ Bonilla said. “In some cases, families purchase their home with two jobs, it was the only way they could afford to purchase a home . . . and they’ve lost one of those jobs. It’s a vicious cycle going on.’’
A computer scan of the first 100 foreclosure cases this year at the Home Preservation Center run by Lowell’s Coalition for a Better Acre showed more than 80 percent involve a fixed-rate loan under 8 percent, said coalition executive di rector Emily Rosenbaum.
“On paper, you’d say what’s the problem?’’ Rosenbaum said. “But when you scan over to the reason they’re coming to the center, it’s all reduction of income, reduction of income, reduction of income.
Sunday, July 18, 2010
MORTGAGE & FINANCE: It’s a great time to get a mortgage, but the rules of the game have changed
For those who qualify, it’s one of the best times to get a mortgage. Last week, rates for 30-year fixed-rate loans fell to 4.57 percent, the lowest average since 1971. And if you missed out on the US home-buying tax credit, the rates may more than make up for that lost $8,000.
“A tax credit is immediate gratification,’’ said Leonard Baron, professor of finance at San Diego State University. “But long-term, with rates this low, you can get much more value.’’
But the game has changed. Your credit score must be at least 620, or you’ll have a hard time finding a loan. And how much you put down is a big variable. Some scenarios:
■You pay 20 percent down and expect to retire in the house.
Take out a 30-year fixed-rate loan. The interest rate stays the same — at historic lows.
■ You have a 20 percent down payment but plan to move in a few years.
Consider an adjustable-rate loan of five, seven, or 10 years. These loans carry a lower initial interest rate than on the 30-year fixed mortgage, so you save money over the fixed-rate period. After the fixed-rate period ends, borrowers typically refinance.
ARMs got a bad rap during the housing bust because most people who took out two- or three-year ARMs got caught with an unaffordable payment when their rates reset. They couldn’t refinance because home prices had tanked and credit tightened up. That risk still exists, but starting in September, lenders will have to evaluate whether borrowers can make payments after the rate resets.
■ You have at least a 20 percent down payment for a house worth more than $729,500.
You need a “jumbo’’ loan, which would not be backed by Fannie Mae or Freddie Mac. That means a lender who writes a mortgage above that amount has to keep the loan on its books. To compensate for that risk, lenders charge higher interest rates.
“A tax credit is immediate gratification,’’ said Leonard Baron, professor of finance at San Diego State University. “But long-term, with rates this low, you can get much more value.’’
But the game has changed. Your credit score must be at least 620, or you’ll have a hard time finding a loan. And how much you put down is a big variable. Some scenarios:
■You pay 20 percent down and expect to retire in the house.
Take out a 30-year fixed-rate loan. The interest rate stays the same — at historic lows.
■ You have a 20 percent down payment but plan to move in a few years.
Consider an adjustable-rate loan of five, seven, or 10 years. These loans carry a lower initial interest rate than on the 30-year fixed mortgage, so you save money over the fixed-rate period. After the fixed-rate period ends, borrowers typically refinance.
ARMs got a bad rap during the housing bust because most people who took out two- or three-year ARMs got caught with an unaffordable payment when their rates reset. They couldn’t refinance because home prices had tanked and credit tightened up. That risk still exists, but starting in September, lenders will have to evaluate whether borrowers can make payments after the rate resets.
■ You have at least a 20 percent down payment for a house worth more than $729,500.
You need a “jumbo’’ loan, which would not be backed by Fannie Mae or Freddie Mac. That means a lender who writes a mortgage above that amount has to keep the loan on its books. To compensate for that risk, lenders charge higher interest rates.
Saturday, July 17, 2010
GREEN LIVING: Start a Compost Pile
Instead of having your food waste, plant debris, and fallen leaves hauled to the dump, why not turn them into compost? The dark, rich organic matter helps garden and landscape plants grow bigger and more beautiful. Plus, it saves you money and time by reducing your water, fertilizer, and even weeding needs, since a few inches of compost laid like mulch will prevent most weeds from sprouting.
Making backyard compost even has a civic benefit because it saves landfill space, helping to keep garbage-processing costs lower for you and your neighbors.
How compost happens
Left alone in a natural habitat, plants create their own compost. Leaves, twigs, and overripe fruit fall to the ground and slowly get broken down into nutrients. You can make this same process happen in an out-of-the-way spot with a compost pile—and distribute the results by sprinkling the compost over planting beds as fertilizer, dropping it into the hole before you set a vegetable plant in the ground, or even using it as mulch.
There are two main ways to compost: You can use only yard waste—or add kitchen waste, too.
Yard waste composting
If you’re composting only yard waste, an open pile is all you need. For the richest, fastest results, alternate layers of green (nitrogen-rich) plant material, such as lawn clippings and plant cuttings, with brown (carbon-rich) material, such as dry leaves. Make the layers approximately equal or add a little more browns than greens.
Cut branches and stems down to 3 to 6 inches long—and skip any that are more than ½ inch thick—unless you’re willing to sift out remaining chunks when you use the compost. Moisten the materials with a garden hose as you add them so they are about as damp as a wrung-out sponge.
If a pile of dead plants would look too messy for your yard, corral the trimmings in a compost bin. You can buy one, but first contact your local solid-waste disposal company or municipal service to ask whether it offers a subsidy for buying a composter—or perhaps even gives them away free.
Friday, July 16, 2010
HOME MAINTANENCE: 6 steps to fire protection
As summer comes on, wildfires can strike anywhere, anytime. They move fast, and often with little warning. You can do a lot to minimize the risk that your home will become a tragic statistic should a wildfire ever come through your area.
Here are six steps you can take this year to help protect your home against wildfires:
1. Create a fire break
The first and perhaps most important step is to create a noncombustible fire break around your home. If you have noncombustible roofing material, the fire break should extend out for 30 feet in all directions. If you have cedar shake roofing, then extend the fire break to 50 feet.
To determine the layout of the fire break area, simply measure out from the edge of the footprint of your home's combustible materials. That might be the edge of the roof overhang, or it might be the edge of a wooden deck that's attached to the house.
Within that fire break zone, create a well-planned and well-maintained area that's as free as possible of combustible vegetation that could support the spread of a wildfire. For example, use fire-resistant landscaping such as lawns, moist ground-cover plantings, and low shrubbery, or hardscaping such as gravel, pavers or other noncombustible materials.
Any trees within the zone should be thinned so that they're no less than 10 feet apart, which helps prevent the spread of a fire from tree to tree, and dead trees should be removed as well. All remaining trees need to be limbed to a height of at least 6 feet, which helps prevent a ground fire from spreading up into them.
Dry grass should be cut to less than 4 inches high, and dead material should be removed or broken up so that a fuel bed isn't created.
2. Clear your driveway
If you have a long driveway that's more than 150 feet, you want to be sure that any overhanging trees are limbed up and back. There needs to be at least 13 1/2 feet of vertical clearance and 12 feet of horizontal clearance to ensure that fire trucks and other emergency vehicles are not impeded in any way.
You also want to make sure that vegetation is cleared back from the driveway for a total distance of 10 feet from the driveway's centerline on each side, creating a 20-foot wide total fuel break area.
3. Clear around the chimney
Sparks from a chimney that's connected to a fireplace or a wood stove are a real fire hazard if they get into tree branches. To keep that from happening, trim overhanging tree branches back a minimum of 10 from the chimney in all directions.
4. Clean up the roof
While you're at it, remove dead branches that overhang any portion of your roof. Not only are they a fire hazard, they're also very dangerous during a wind storm. If you're not comfortable with any of this type of limbing, hire an experienced, licensed tree-trimming company to handle it for you.
In addition to the trimming, remove dead leaves and pine needles from the roof and gutters. That also includes patio covers and similar areas. These leaf and needle buildups are extremely flammable, and a single spark or ember can quickly spread.
5. Move firewood piles
A pile of firewood or lumber that's stacked alongside the house can be a source of sustained heat during a wildfire. Firewood and lumber should be moved at least 20 feet away from the house during fire season. An even better solution is to build a separate enclosed shed for wood storage.
6. Don't use the area under decks for storage
That big open area under your deck or outside stairs is a very inviting place to store lumber, firewood, paint, gasoline and lots of other things you use outside. But fires can draft under those areas very easily, and having a stockpile of flammable materials there can quickly feed a fire.
Clear combustible materials -- including buildups of dead leaves and weeds -- from under decks and stairs, then enclose the area.
Paul Bianchina Inman News July 9, 2010
Here are six steps you can take this year to help protect your home against wildfires:
1. Create a fire break
The first and perhaps most important step is to create a noncombustible fire break around your home. If you have noncombustible roofing material, the fire break should extend out for 30 feet in all directions. If you have cedar shake roofing, then extend the fire break to 50 feet.
To determine the layout of the fire break area, simply measure out from the edge of the footprint of your home's combustible materials. That might be the edge of the roof overhang, or it might be the edge of a wooden deck that's attached to the house.
Within that fire break zone, create a well-planned and well-maintained area that's as free as possible of combustible vegetation that could support the spread of a wildfire. For example, use fire-resistant landscaping such as lawns, moist ground-cover plantings, and low shrubbery, or hardscaping such as gravel, pavers or other noncombustible materials.
Any trees within the zone should be thinned so that they're no less than 10 feet apart, which helps prevent the spread of a fire from tree to tree, and dead trees should be removed as well. All remaining trees need to be limbed to a height of at least 6 feet, which helps prevent a ground fire from spreading up into them.
Dry grass should be cut to less than 4 inches high, and dead material should be removed or broken up so that a fuel bed isn't created.
2. Clear your driveway
If you have a long driveway that's more than 150 feet, you want to be sure that any overhanging trees are limbed up and back. There needs to be at least 13 1/2 feet of vertical clearance and 12 feet of horizontal clearance to ensure that fire trucks and other emergency vehicles are not impeded in any way.
You also want to make sure that vegetation is cleared back from the driveway for a total distance of 10 feet from the driveway's centerline on each side, creating a 20-foot wide total fuel break area.
3. Clear around the chimney
Sparks from a chimney that's connected to a fireplace or a wood stove are a real fire hazard if they get into tree branches. To keep that from happening, trim overhanging tree branches back a minimum of 10 from the chimney in all directions.
4. Clean up the roof
While you're at it, remove dead branches that overhang any portion of your roof. Not only are they a fire hazard, they're also very dangerous during a wind storm. If you're not comfortable with any of this type of limbing, hire an experienced, licensed tree-trimming company to handle it for you.
In addition to the trimming, remove dead leaves and pine needles from the roof and gutters. That also includes patio covers and similar areas. These leaf and needle buildups are extremely flammable, and a single spark or ember can quickly spread.
5. Move firewood piles
A pile of firewood or lumber that's stacked alongside the house can be a source of sustained heat during a wildfire. Firewood and lumber should be moved at least 20 feet away from the house during fire season. An even better solution is to build a separate enclosed shed for wood storage.
6. Don't use the area under decks for storage
That big open area under your deck or outside stairs is a very inviting place to store lumber, firewood, paint, gasoline and lots of other things you use outside. But fires can draft under those areas very easily, and having a stockpile of flammable materials there can quickly feed a fire.
Clear combustible materials -- including buildups of dead leaves and weeds -- from under decks and stairs, then enclose the area.
Paul Bianchina Inman News July 9, 2010
Thursday, July 15, 2010
MARKET TRENDS: Tracking housing market's next move
Look locally for the best data.
Sales of existing homes rose 7.6 percent nationally in April and the median home price increased 4 percent from a year ago, according to the National Association of Realtors (NAR).
The Conference Board Consumer Confidence Index rose to 63.3 in May compared to April, the third consecutive monthly gain. Although low compared to pre-recession years, the recent increase reflects consumers' confidence about job prospects.
The Institute for Supply Management reported that its business barometer was 59.7 in May. A figure above 50 suggests expansion.
This is good news for the economy. However, there are shadows overhanging the home-sale market and a certain amount of uncertainty about what the second half of the year will bring.
A concern is the expiration of the national tax credits for both first-time and repeat homebuyers. Most analysts agree that the tax credits were a boost to the market.
Some say the credits artificially inflated home sales. They expect to see a drop in sales volume and a possible decline in home prices going forward. Also, some say that these buyers would have bought regardless of the tax credits.
It will take months to determine what effect, if any, the lack of credits will have on the market. To take advantage of the credit, a buyer had to be in contract to purchase a home costing no more than $800,000 by April 30 with a closing date of no later than June 30.
Homes closing in May and June will reflect sales activity stimulated by the homebuyer credits. It won't be until July and August, typically slow months for home sales, that we will be able to see if the market slows.
HOUSE HUNTING TIP: Keep your eye on NAR's Pending Sale Index (PHSI). The PHSI is based on home purchase contract activity. It normally takes 30-60 days or longer from the date a contract is ratified by the buyer and seller to close a sale. Some sales that go into contract never close.
The PHSI index was designed to be a forward indicator. A lower pending index in May than in April could indicate a slowdown in home-sale activity, even though home sales for the month could increase due to closings of transactions negotiated in April before the tax credits expired. NAR releases the PHSI during the first week of every month.
Optimists are confident that today's near historic low interest rates will continue to encourage homebuyers back into the market. Combined with lower home prices and more homes for sale in many areas, this could be one of the best times to buy in decades, if you can find the right home that will suit your long-range needs and you qualify for the financing you need to complete the purchase.
NAR's chief economist Lawrence Yun expects the median home price to rise nationally 2 to 3 percent this year. He does not think foreclosure sales will derail the housing market this year.
Mark Zandi, chief economist at Moody's Economy.com, believes the housing crash is nearly over. He thinks we're close to the bottom, but that we won't see price growth in 2010 or 2011.
Zandi sees foreclosures rising in 2010 before declining in 2011. If you buy now, home prices could decrease some before increasing. If you wait, interest rates could be higher.
The home-sale market is highly localized. According to research company MDA DataQuick, San Francisco Bay Area home sales fell 1.2 percent, but the median home price was up 22 percent in April from a year ago. Las Vegas-area home sales fell 0.2 percent, but the median sale price was down 0.7 percent from April 2009.
THE CLOSING: Look at sales activity in your neighborhood to get a complete picture.
Dian Hymer Inmsn News July 12, 2010
Sales of existing homes rose 7.6 percent nationally in April and the median home price increased 4 percent from a year ago, according to the National Association of Realtors (NAR).
The Conference Board Consumer Confidence Index rose to 63.3 in May compared to April, the third consecutive monthly gain. Although low compared to pre-recession years, the recent increase reflects consumers' confidence about job prospects.
The Institute for Supply Management reported that its business barometer was 59.7 in May. A figure above 50 suggests expansion.
This is good news for the economy. However, there are shadows overhanging the home-sale market and a certain amount of uncertainty about what the second half of the year will bring.
A concern is the expiration of the national tax credits for both first-time and repeat homebuyers. Most analysts agree that the tax credits were a boost to the market.
Some say the credits artificially inflated home sales. They expect to see a drop in sales volume and a possible decline in home prices going forward. Also, some say that these buyers would have bought regardless of the tax credits.
It will take months to determine what effect, if any, the lack of credits will have on the market. To take advantage of the credit, a buyer had to be in contract to purchase a home costing no more than $800,000 by April 30 with a closing date of no later than June 30.
Homes closing in May and June will reflect sales activity stimulated by the homebuyer credits. It won't be until July and August, typically slow months for home sales, that we will be able to see if the market slows.
HOUSE HUNTING TIP: Keep your eye on NAR's Pending Sale Index (PHSI). The PHSI is based on home purchase contract activity. It normally takes 30-60 days or longer from the date a contract is ratified by the buyer and seller to close a sale. Some sales that go into contract never close.
The PHSI index was designed to be a forward indicator. A lower pending index in May than in April could indicate a slowdown in home-sale activity, even though home sales for the month could increase due to closings of transactions negotiated in April before the tax credits expired. NAR releases the PHSI during the first week of every month.
Optimists are confident that today's near historic low interest rates will continue to encourage homebuyers back into the market. Combined with lower home prices and more homes for sale in many areas, this could be one of the best times to buy in decades, if you can find the right home that will suit your long-range needs and you qualify for the financing you need to complete the purchase.
NAR's chief economist Lawrence Yun expects the median home price to rise nationally 2 to 3 percent this year. He does not think foreclosure sales will derail the housing market this year.
Mark Zandi, chief economist at Moody's Economy.com, believes the housing crash is nearly over. He thinks we're close to the bottom, but that we won't see price growth in 2010 or 2011.
Zandi sees foreclosures rising in 2010 before declining in 2011. If you buy now, home prices could decrease some before increasing. If you wait, interest rates could be higher.
The home-sale market is highly localized. According to research company MDA DataQuick, San Francisco Bay Area home sales fell 1.2 percent, but the median home price was up 22 percent in April from a year ago. Las Vegas-area home sales fell 0.2 percent, but the median sale price was down 0.7 percent from April 2009.
THE CLOSING: Look at sales activity in your neighborhood to get a complete picture.
Dian Hymer Inmsn News July 12, 2010
Wednesday, July 14, 2010
INVESTMENT HOME BUYING: Calculate cash flow for second home
A winning formula for investment properties
Let's assume home values are down in the area where you like to vacation. Truth be told, you wouldn't mind retiring there one day.
If you bought an investment home now and rented it out, is there any way of knowing if it will appreciate?
And, is there a break-even formula to use when considering annual cash flow?
One of the better second-home rental formulas now used was developed by Christine Karpinski, author of "How to Rent Vacation Properties by Owner."
Karpinski's definition of the break-even point is when all of the income (rent) from your vacation rental property is enough to pay all of the bills associated with ownership of the property. In other words, your vacation home should not cost you another dime after your downpayment.
According to Karpinski, if your monthly mortgage payment is equal to or less than one "peak" week rental rate, and if you rent for 17 weeks, then you should be able to achieve positive cash flow.
Consider a property that rents "by owner" for $2,000 per week during the peak season, with a monthly mortgage payment of $2,000. There are 12 peak weeks, most or all of which are generally occupied. Then 12 weeks rented equal one year's mortgage payments.
In addition, you'll need to rent five other weeks to pay for incidentals such as power, phone, association dues, minor maintenance, etc. If you handle the rental yourself and have 17 weeks booked (33 percent occupancy), you will have an even cash flow.
Rent more and you have positive cash flow, according to Karpinski, who serves as the director of HomeAway.com's owner community.
Let's assume home values are down in the area where you like to vacation. Truth be told, you wouldn't mind retiring there one day.
If you bought an investment home now and rented it out, is there any way of knowing if it will appreciate?
And, is there a break-even formula to use when considering annual cash flow?
One of the better second-home rental formulas now used was developed by Christine Karpinski, author of "How to Rent Vacation Properties by Owner."
Karpinski's definition of the break-even point is when all of the income (rent) from your vacation rental property is enough to pay all of the bills associated with ownership of the property. In other words, your vacation home should not cost you another dime after your downpayment.
According to Karpinski, if your monthly mortgage payment is equal to or less than one "peak" week rental rate, and if you rent for 17 weeks, then you should be able to achieve positive cash flow.
Consider a property that rents "by owner" for $2,000 per week during the peak season, with a monthly mortgage payment of $2,000. There are 12 peak weeks, most or all of which are generally occupied. Then 12 weeks rented equal one year's mortgage payments.
In addition, you'll need to rent five other weeks to pay for incidentals such as power, phone, association dues, minor maintenance, etc. If you handle the rental yourself and have 17 weeks booked (33 percent occupancy), you will have an even cash flow.
Rent more and you have positive cash flow, according to Karpinski, who serves as the director of HomeAway.com's owner community.
Tuesday, July 13, 2010
BOOK REVIEW: 'Buying a Home: The Missing Manual'
Homeownership deconstructed
Book Review
Title: "Buying a Home: The Missing Manual"
Author: Nancy Connor
Publisher: O'Reilly, 2010; 352 pages; $21.99
As far as provocative titles go, "Buying a Home: The Missing Manual" may not ooze "avant garde" at first glance. But if you, like me, keep tabs on the ever-increasing booklist of real estate titles, you might, like me, feel that to describe any book on homebuying as "the missing" one is to create some pretty big expectations.
If the title initially sparked my skepticism, it was only stoked by the cover's short description of the author as a "real estate pro," juxtaposed against its long description of her background as a real estate investor who is "qualified" for a New York real estate license, and has written other books on Google and living "green." All of these things sounded a warning bleep for me, even before I could open the cover.
However, I was aware that "The Missing Manual" series was the brainchild of David Pogue, a New York Times columnist who I follow, and whom I particularly admire as a polymath -- in other words, a guy who knows a whole lot of stuff about a whole lot of stuff.
So, I tried hard to keep an open mind about how much expertise this "pro" could possibly impart to readers on the subject of buying a home.
So I did -- and was pleasantly surprised, for the most part. The fact is, homebuyers -- and especially first-timers -- speak plain English, not always the same language spoken by those who can accurately claim themselves to be bona fide real estate experts.
I don't know that I'd say "Buying a Home: The Missing Manual" is revolutionary in the content it covers, or in any other respect, really. But it is a very accessible, very complete, concise and usable specimen of the how-to real estate genre -- and one that is written in a simple, accurate voice that users will appreciate.
Book Review
Title: "Buying a Home: The Missing Manual"
Author: Nancy Connor
Publisher: O'Reilly, 2010; 352 pages; $21.99
If the title initially sparked my skepticism, it was only stoked by the cover's short description of the author as a "real estate pro," juxtaposed against its long description of her background as a real estate investor who is "qualified" for a New York real estate license, and has written other books on Google and living "green." All of these things sounded a warning bleep for me, even before I could open the cover.
However, I was aware that "The Missing Manual" series was the brainchild of David Pogue, a New York Times columnist who I follow, and whom I particularly admire as a polymath -- in other words, a guy who knows a whole lot of stuff about a whole lot of stuff.
So, I tried hard to keep an open mind about how much expertise this "pro" could possibly impart to readers on the subject of buying a home.
So I did -- and was pleasantly surprised, for the most part. The fact is, homebuyers -- and especially first-timers -- speak plain English, not always the same language spoken by those who can accurately claim themselves to be bona fide real estate experts.
I don't know that I'd say "Buying a Home: The Missing Manual" is revolutionary in the content it covers, or in any other respect, really. But it is a very accessible, very complete, concise and usable specimen of the how-to real estate genre -- and one that is written in a simple, accurate voice that users will appreciate.
Monday, July 12, 2010
MARKET TRENDS: 5 Gen Y housing trends to watch
Real estate preferences more 'traditional' than expected
For so long, everything in housing has been Baby Boom, Baby Boom, Baby Boom. There are so many of them -- about 76 million, born between 1946-64 -- and their spending habits so influential that for years they've driven the decision-making process at all levels of the housing world.
The successor demographic, dubbed Generation X, has started to be heard. But a California real estate consulting firm is looking further down the road, and charting the housing preferences of Generation Y, sometimes called the Echo Boomers or Millennials.
They're going to be influential -- though maybe for what they're not going to do rather than what they will do, according to Tim Cornwell, a researcher for the Concord Group, a housing consultancy in San Francisco that in the past year has been studying their housing attitudes.
"Our generation has been raised in a world where they're told every single day they can have everything they want," he said of Generation Y, of which he is a member, having been born in 1980. The reality of today's economy may make that mindset a little tricky for them, he said.
Five things to know about Gen Y and housing:
1. Demographers differ on when members of Generation Y started to be born, though one often-cited bracket for the age group is 1977 through 1989, years that slightly overlap with Generation X, which analysts generally say were born 1965 through 1980. Generally speaking, the 60 million or so Americans in the Y group are now in their 20s, and Cornwell said they haven't been studied much yet.
2. Where baby boomers and Gen X started to make themselves known in the real estate market in their 20s, Generation Y will be taking its time, for a couple of reasons, Cornwell said.
For one thing, they're postponers. "They graduate from college and use graduate school to postpone adulthood or they travel" for an extended period after school, he said. These decisions limit their earnings and any savings that might otherwise go into homebuying, he said.
And then there's the economy.
"The economic picture for Generation Y is depressingly ugly," he said. In his company's research, 40 percent said they're still getting significant financial help from their families.
Thus, they're not likely to begin buying real estate in significant numbers until they hit the age of 35, he said.
"For most people in their mid-to-late 20s, (homebuying) isn't even in the conversation," Cornwell said. "Most of us can't afford to buy our parents' houses. Either our preferences have to change or density issues will come up."
3. Cornwell said Gen Y has a "mobile mindset," where lifestyle is everything.
"Used to be, you picked a job and you moved to the city where that job was," Cornwell said. But this group values locale and amenities first, and may be inclined to move to try out different
For so long, everything in housing has been Baby Boom, Baby Boom, Baby Boom. There are so many of them -- about 76 million, born between 1946-64 -- and their spending habits so influential that for years they've driven the decision-making process at all levels of the housing world.
The successor demographic, dubbed Generation X, has started to be heard. But a California real estate consulting firm is looking further down the road, and charting the housing preferences of Generation Y, sometimes called the Echo Boomers or Millennials.
They're going to be influential -- though maybe for what they're not going to do rather than what they will do, according to Tim Cornwell, a researcher for the Concord Group, a housing consultancy in San Francisco that in the past year has been studying their housing attitudes.
"Our generation has been raised in a world where they're told every single day they can have everything they want," he said of Generation Y, of which he is a member, having been born in 1980. The reality of today's economy may make that mindset a little tricky for them, he said.
Five things to know about Gen Y and housing:
1. Demographers differ on when members of Generation Y started to be born, though one often-cited bracket for the age group is 1977 through 1989, years that slightly overlap with Generation X, which analysts generally say were born 1965 through 1980. Generally speaking, the 60 million or so Americans in the Y group are now in their 20s, and Cornwell said they haven't been studied much yet.
2. Where baby boomers and Gen X started to make themselves known in the real estate market in their 20s, Generation Y will be taking its time, for a couple of reasons, Cornwell said.
For one thing, they're postponers. "They graduate from college and use graduate school to postpone adulthood or they travel" for an extended period after school, he said. These decisions limit their earnings and any savings that might otherwise go into homebuying, he said.
And then there's the economy.
"The economic picture for Generation Y is depressingly ugly," he said. In his company's research, 40 percent said they're still getting significant financial help from their families.
Thus, they're not likely to begin buying real estate in significant numbers until they hit the age of 35, he said.
"For most people in their mid-to-late 20s, (homebuying) isn't even in the conversation," Cornwell said. "Most of us can't afford to buy our parents' houses. Either our preferences have to change or density issues will come up."
3. Cornwell said Gen Y has a "mobile mindset," where lifestyle is everything.
"Used to be, you picked a job and you moved to the city where that job was," Cornwell said. But this group values locale and amenities first, and may be inclined to move to try out different
Sunday, July 11, 2010
MORTGAGE & FINANCE: The return of the plain vanilla mortgage
Plain vanilla is back, in stealth mode.
A year ago, the Obama administration set out its goals for financial reform. One goal was to require mortgage lenders to offer "plain vanilla" loans. The definition of "plain vanilla" wasn't as narrow as you might expect: It included not only 30-year fixed-rate mortgages, but also hybrid ARMs. A plain vanilla mortgage would fully amortize in 30 years or less, and be fully documented, and have a reasonable rate and fees.
The Senate tossed out plain vanilla quickly. But a form of plain vanilla survives. The financial regulation bill that emerged from the House-Senate conference doesn't require lenders to offer plain vanilla mortgages, but it offers strong incentives.
The main incentive involves "risk retention." Under the compromise bill, the lender and possibly the securitizer would have to keep 5 percent of each mortgage when it is securitized. This requirement would remove some of the benefit of securitization. By tying up banks' reserves, the risk retention requirement would reduce banks' ability to lend.
But plain vanilla loans are exempt from the risk retention requirement. The bill doesn't call these loans "plain vanilla" -- it calls them "qualified residential mortgages."
Ultimately, I think the big banks will stick with plain vanilla loans. If subprime or interest-only or option ARM mortgages ever make a comeback, they might come from residential investment real estate trusts that will have powerful incentives to lend prudently. And many of those loans are likely to share the appreciation between borrower and lender.
For example, an option-ARM lender might require a sizable down payment, and the lender might also get the first 5 percent of price appreciation when the house is sold or the loan is refinanced. And the lender might get a split of the appreciation after that.
Yep, that's where I think this is going: When a lender has to retain 5 percent of the risk, it's going to want a share of the house's appreciated value.
Most borrowers will just want a plain vanilla. And if you got this far, I bet you can't believe you just read a 354-word piece on qualified mortgages and shared appreciation, you policy wonk you.
By Holden Lewis · Bankrate.com June 29, 2010
A year ago, the Obama administration set out its goals for financial reform. One goal was to require mortgage lenders to offer "plain vanilla" loans. The definition of "plain vanilla" wasn't as narrow as you might expect: It included not only 30-year fixed-rate mortgages, but also hybrid ARMs. A plain vanilla mortgage would fully amortize in 30 years or less, and be fully documented, and have a reasonable rate and fees.
The Senate tossed out plain vanilla quickly. But a form of plain vanilla survives. The financial regulation bill that emerged from the House-Senate conference doesn't require lenders to offer plain vanilla mortgages, but it offers strong incentives.
The main incentive involves "risk retention." Under the compromise bill, the lender and possibly the securitizer would have to keep 5 percent of each mortgage when it is securitized. This requirement would remove some of the benefit of securitization. By tying up banks' reserves, the risk retention requirement would reduce banks' ability to lend.
But plain vanilla loans are exempt from the risk retention requirement. The bill doesn't call these loans "plain vanilla" -- it calls them "qualified residential mortgages."
Ultimately, I think the big banks will stick with plain vanilla loans. If subprime or interest-only or option ARM mortgages ever make a comeback, they might come from residential investment real estate trusts that will have powerful incentives to lend prudently. And many of those loans are likely to share the appreciation between borrower and lender.
For example, an option-ARM lender might require a sizable down payment, and the lender might also get the first 5 percent of price appreciation when the house is sold or the loan is refinanced. And the lender might get a split of the appreciation after that.
Yep, that's where I think this is going: When a lender has to retain 5 percent of the risk, it's going to want a share of the house's appreciated value.
Most borrowers will just want a plain vanilla. And if you got this far, I bet you can't believe you just read a 354-word piece on qualified mortgages and shared appreciation, you policy wonk you.
By Holden Lewis · Bankrate.com June 29, 2010
Saturday, July 10, 2010
JUST FOR FUN: Big Bang Boom . . . The new wall painted by Blu
Stop-motion graffiti artist Blu, of MUTO fame, takes his technique to the next level:
NESW: Boston Business Journal names William Raveis Real Estate" #1 Place To Work"
The events leading to this unexpected honor included making a first cut of 440 companies amidst thousands that completed an employee satisfaction survey. The second round selection was even tougher, with only 60 companies qualifying…William Raveis made the cut. “We felt thankful to be in the top 60, considering the number of participants in the survey and being amongst 5,000 or so real estate companies in the state of Massachusetts,” said Mr. Raveis.
The top 60 companies were invited to a function at the lovely Seaport Hotel in Boston, attended by over 500 participants. Also competing for the award were world-renowned companies such as Microsoft, Google, Accenture, Ritz Carlton and Harvard Pilgrim Health Care. Bill and Chris Raveis, Executive Vice President and managing partner of William Raveis, Massachusetts and his management team attended. Once everyone was seated, members of The Boston Business Journal staff began counting down the best companies starting with number 60. The Raveis team held its breath before each company was called, expecting to soon hear its name. However, when the firm made the Top 10 and then Top 5 cut, a sense of excitement came over the Raveis team. # 2 was called…and it wasn’t William Raveis. “When #2 was announced and it wasn’t us, Chris and I looked at each other and realized that we won the #1 Place to work in Massachusetts. It was quite a moment for me, Chris and his management team,” said Mr. Raveis, feeling humbled to receive the prestigious accolade.
Friday, July 9, 2010
LOCAVORE HOMES: What I did for local
Foodies have taken up the locavore movement. Could homeowners do the same with building materials? As she embarked on her own home-renovation project, one New Hampshire resident decided to find out.
A DOWN-HOME KITCHEN Birch flooring and maple cabinetry are made of wood logged in New England. Slate countertops and cherry and maple stools all hail from Vermont. (Photograph by Cheryl Senter)
The driver hands down a hard hat from the cab of his pickup truck and chuckles. “You came to the quarry in sneakers and a dress? Well, hop in.” Mike Blair, superintendent of the largest underground marble quarry in the world, noses the truck into a hole in the side of Mount Dorset. We leave the daylight behind. The truck’s headlights illuminate glittering walls of towering white stone.
“We can drive almost a mile and a half into the mountain from here,” Blair says as the truck bumps forward in low gear.
“Is that so?”
No wonder most people shop for their countertops in climate-controlled showrooms.
The reason I’ve descended into the depths of Vermont Quarries, under Danby, Vermont, is that I’d decided to “go local.” Renovating my home in Hanover, New Hampshire, I’d become confused by the overwhelming selection of “green” choices. So instead of teasing apart the pros and cons of each new high-tech product, I would furnish my home with ordinary things that had been mined, logged, and finished nearby. My theory was that if local sources were good for the neighborhood, I’d be able to see for myself. And with the New England economy in the doldrums, why wouldn’t I want to shop at home?
As a fan of local foods, I’d hoped it would be as simple as pushing a cart through Whole Foods and reading the labels. I would quickly learn that in the world of construction, the “organic”-versus-local debate had barely begun.
“We’ve been mining this same quarry – about 40 acres – since 1902,” Blair says with evident pride. Since the quarry is underground, diners down the road at the Country Kitchen may not even know it’s there.
Deep inside the main shaft, Vermonters on two shifts slice 20-ton blocks into slabs and polish marble tiles. The result is a high-quality product. Danby marble appears in the US Supreme Court Building, in Senate office buildings, and on headstones at Arlington Cemetery. It’s on buildings at Yale and Princeton.
Where you won’t find Danby marble, however, is at your local big-box home store. The marble for sale in those places is all imported, usually from Brazil. Marble is not the only local product to keep a low profile. I fell in love with Vermont slate. It’s common enough in the form of tiles, but few people know that it makes beautiful and sturdy slab countertops. And although I live in the Granite State, I have yet to find a tile showroom displaying New Hampshire granite.
As I made my way through my renovation shopping list, I found the same disconnect everywhere. Flooring showrooms carried a complete alphabet of wood choices: ash, birch, cherry, and on, down to zebrawood. But they were silent about its origins. Yet any 5-mile drive down our highway meant passing trucks loaded with timber. I began to have the urge to tail them like a spy.
Architect Pi Smith, of Smith & Vansant Architects in Norwich, Vermont, is familiar with the problem. “It used to be that ordinary people made do with local materials, while the rich and powerful imported exotic treasures. Think of Isabella Stewart Gardner and the Venetian windows she built into her Boston mansion.”
The driver hands down a hard hat from the cab of his pickup truck and chuckles. “You came to the quarry in sneakers and a dress? Well, hop in.” Mike Blair, superintendent of the largest underground marble quarry in the world, noses the truck into a hole in the side of Mount Dorset. We leave the daylight behind. The truck’s headlights illuminate glittering walls of towering white stone.
“We can drive almost a mile and a half into the mountain from here,” Blair says as the truck bumps forward in low gear.
“Is that so?”
No wonder most people shop for their countertops in climate-controlled showrooms.
The reason I’ve descended into the depths of Vermont Quarries, under Danby, Vermont, is that I’d decided to “go local.” Renovating my home in Hanover, New Hampshire, I’d become confused by the overwhelming selection of “green” choices. So instead of teasing apart the pros and cons of each new high-tech product, I would furnish my home with ordinary things that had been mined, logged, and finished nearby. My theory was that if local sources were good for the neighborhood, I’d be able to see for myself. And with the New England economy in the doldrums, why wouldn’t I want to shop at home?
As a fan of local foods, I’d hoped it would be as simple as pushing a cart through Whole Foods and reading the labels. I would quickly learn that in the world of construction, the “organic”-versus-local debate had barely begun.
“We’ve been mining this same quarry – about 40 acres – since 1902,” Blair says with evident pride. Since the quarry is underground, diners down the road at the Country Kitchen may not even know it’s there.
Deep inside the main shaft, Vermonters on two shifts slice 20-ton blocks into slabs and polish marble tiles. The result is a high-quality product. Danby marble appears in the US Supreme Court Building, in Senate office buildings, and on headstones at Arlington Cemetery. It’s on buildings at Yale and Princeton.
Where you won’t find Danby marble, however, is at your local big-box home store. The marble for sale in those places is all imported, usually from Brazil. Marble is not the only local product to keep a low profile. I fell in love with Vermont slate. It’s common enough in the form of tiles, but few people know that it makes beautiful and sturdy slab countertops. And although I live in the Granite State, I have yet to find a tile showroom displaying New Hampshire granite.
As I made my way through my renovation shopping list, I found the same disconnect everywhere. Flooring showrooms carried a complete alphabet of wood choices: ash, birch, cherry, and on, down to zebrawood. But they were silent about its origins. Yet any 5-mile drive down our highway meant passing trucks loaded with timber. I began to have the urge to tail them like a spy.
Architect Pi Smith, of Smith & Vansant Architects in Norwich, Vermont, is familiar with the problem. “It used to be that ordinary people made do with local materials, while the rich and powerful imported exotic treasures. Think of Isabella Stewart Gardner and the Venetian windows she built into her Boston mansion.”
Thursday, July 8, 2010
NEWS: House votes to extend tax credit on new home purchases 3 months
WASHINGTON — Home buyers would get an extra three months to complete their purchases and qualify for a generous tax credit under a bill overwhelmingly passed by the House yesterday.
Under current law, buyers who signed purchase agreements by April 30 have until today to close on the sale to qualify for tax credits of up to $8,000. The bill would give buyers until Sept. 30 to complete their purchases.
The extended deadline only applies to people who signed purchase agreements by April 30. The National Association of Realtors estimates that about 180,000 home buyers who already signed purchase agreements are likely to miss today’s deadline.
“We owe this to the people who have essentially followed the rules who are caught by a closing date,’’ said Representative Sander Levin, Democrat of Michigan and chairman of the House Ways and Means Committee.
The bill passed 409 to 5. It now goes to the Senate, where majority leader Harry Reid, Democrat of Nevada, has sponsored a similar measure.
The popular tax credit has helped to stabilize the nation’s slumping housing market.
The Realtors group says the tax credit has generated 1 million new home sales.
The bill would also make it easier for the IRS and state prison officials to share information about inmates in an effort to fight fraud. The Treasury Department’s inspector general for tax administration reported last week that nearly 1,300 prison inmates had improperly received more than $9 million in homebuyer tax credits while they were locked up.
The tax credit for first-time home buyers was part of President Obama’s economic recovery package enacted last year. In November, Congress extended the credit and expanded it to longtime owners who bought new homes. First-time buyers were eligible for a tax credit of up to $8,000. Current owners who bought and moved into another home could qualify for a credit of up to $6,500.
The Realtors group has been pushing hard in Congress for the extension. Mortgage lenders, the trade group says, have been swamped with borrowers trying to get approved by the end of the month.
The Massachusetts Association of Realtors said that up to 3,930 Bay State buyers could have lost the advantage of the credit if the extension were not passed.
Associated Press and Chris Ready of Boston Globe June 30, 2010
Under current law, buyers who signed purchase agreements by April 30 have until today to close on the sale to qualify for tax credits of up to $8,000. The bill would give buyers until Sept. 30 to complete their purchases.
The extended deadline only applies to people who signed purchase agreements by April 30. The National Association of Realtors estimates that about 180,000 home buyers who already signed purchase agreements are likely to miss today’s deadline.
“We owe this to the people who have essentially followed the rules who are caught by a closing date,’’ said Representative Sander Levin, Democrat of Michigan and chairman of the House Ways and Means Committee.
The bill passed 409 to 5. It now goes to the Senate, where majority leader Harry Reid, Democrat of Nevada, has sponsored a similar measure.
The popular tax credit has helped to stabilize the nation’s slumping housing market.
The Realtors group says the tax credit has generated 1 million new home sales.
The bill would also make it easier for the IRS and state prison officials to share information about inmates in an effort to fight fraud. The Treasury Department’s inspector general for tax administration reported last week that nearly 1,300 prison inmates had improperly received more than $9 million in homebuyer tax credits while they were locked up.
The tax credit for first-time home buyers was part of President Obama’s economic recovery package enacted last year. In November, Congress extended the credit and expanded it to longtime owners who bought new homes. First-time buyers were eligible for a tax credit of up to $8,000. Current owners who bought and moved into another home could qualify for a credit of up to $6,500.
The Realtors group has been pushing hard in Congress for the extension. Mortgage lenders, the trade group says, have been swamped with borrowers trying to get approved by the end of the month.
The Massachusetts Association of Realtors said that up to 3,930 Bay State buyers could have lost the advantage of the credit if the extension were not passed.
Associated Press and Chris Ready of Boston Globe June 30, 2010
Wednesday, July 7, 2010
LOCAN NEWS: Ailing Roslindale block gets a new life
At Washington Beech, HUD official pushes to change way public housing is funded
ROSLINDALE — Sandra B. Henriquez was thrilled when she got her first look at a newly rebuilt section of the Washington Beech public housing project yesterday. “Oh, my gosh,’’ Henriquez said as she drove into the complex. “Oh, my gosh.’’
Henriquez has never lived at Washington Beech, but in a way the visit was a homecoming — she pushed for improvements to the formerly dilapidated and dreary block of brick buildings during her 13 years as head of the Boston Housing Authority. She left Boston last year to serve as assistant secretary of the Office of Public and Indian Housing at the US Department of Housing and now is charged with helping to upgrade the nation’s ailing public housing stock.
She said Washington Beech exemplifies the possibilities for making improvements — and is a warning about what happens when public housing is neglected for too long.
Yesterday, Henriquez held a hand over her heart and beamed as she viewed a small neighborhood of colorful townhouses and apartments with walkways, gardens, and a splashing water fountain.
“This is a true commitment and a true picture of what can be done,’’ she said. “It is to die for.’’
Washington Beech, built in 1952, was allowed to fall into such disrepair over decades that it had to be demolished and rebuilt at a cost of about $100 million. Funding came from federal stimulus money and a US grant for severely distressed properties. The 266-unit project is being replaced by a less dense layout with 206 energy-efficient homes, designed to more resemble a neighborhood than institutional complex.
“They get so obsolete and uninhabitable that the only thing you can do is tear them down and start again,’’ Henriquez said of places like Washington Beech. “That is what we want to avoid.’’
Henriquez, who started at HUD last June, is advocating for federal legislation that would dramatically change how public housing is funded. The proposal, known as the Preservation, Enhancement, and Transformation of Rental Assistance Act, would allow housing authorities to take out mortgages to fund improvements and keep current projects afloat.
The complex bill also aims to simplify the federal housing bureaucracy, currently bogged down with 13 rental assistance programs, and provide low-income tenants more of a choice in where they live.
The Obama administration says it supports the plan in hopes of saving public housing units, which are being sold and demolished at a rate of about 10,000 per year. In Massachusetts, about 2,045 public housing units have been lost over the last decade, HUD officials say.
“We are bringing public housing into the world of real estate,’’ said Henriquez. “We are unleashing untapped equity.’’
But the legislation is already spurring criticism and concern as local housing officials and advocates pick apart the details.
Aaron Gornstein, the executive director of the local nonprofit Citizens’ Housing and Planning Association, said the bill is needed to help chronically underfunded housing projects. But he wants to know more about such issues as how to keep units public in perpetuity, and how the law handles properties that go into mortgage default.
“This would be the biggest change to public housing since the program started in 1937,’’ Gornstein said.
Lydia Agro, communications director for the BHA, said local officials have “serious concerns’’ about the bill’s provisions for tenant protections, waiting lists, and subsidies for individual projects. “There are a lot of details that need to be talked about, worked out, and discussed,’’ she said.
Henriquez, who is traveling around the country to talk about the bill, said the Obama administration is eager to help craft a proposal that can pass on Capitol Hill. She said she was glad to return to Boston, a city she often cites in Washington as a model of public housing.
She joined Boston Mayor Thomas M. Menino, Governor Deval Patrick, and others to celebrate the first phase of redevelopment of Washington Beech. In addition to the 206 new units, the project will eventually include 136 other “affordable housing opportunities,’’ such as rent subsidies and financial grants, to help people buy homes of their own. The idea is to offset the housing units lost as a result of reconstruction.
Menino said the new complex “makes people’s lives a little bit better.’’ Patrick said the upgrade gives residents “the kind of housing they deserve.’’
The second phase of the project is scheduled to be completed in 2012.
Jenifer B. McKim Boston Globe June 20, 2010
Henriquez has never lived at Washington Beech, but in a way the visit was a homecoming — she pushed for improvements to the formerly dilapidated and dreary block of brick buildings during her 13 years as head of the Boston Housing Authority. She left Boston last year to serve as assistant secretary of the Office of Public and Indian Housing at the US Department of Housing and now is charged with helping to upgrade the nation’s ailing public housing stock.
She said Washington Beech exemplifies the possibilities for making improvements — and is a warning about what happens when public housing is neglected for too long.
Yesterday, Henriquez held a hand over her heart and beamed as she viewed a small neighborhood of colorful townhouses and apartments with walkways, gardens, and a splashing water fountain.
“This is a true commitment and a true picture of what can be done,’’ she said. “It is to die for.’’
Washington Beech, built in 1952, was allowed to fall into such disrepair over decades that it had to be demolished and rebuilt at a cost of about $100 million. Funding came from federal stimulus money and a US grant for severely distressed properties. The 266-unit project is being replaced by a less dense layout with 206 energy-efficient homes, designed to more resemble a neighborhood than institutional complex.
“They get so obsolete and uninhabitable that the only thing you can do is tear them down and start again,’’ Henriquez said of places like Washington Beech. “That is what we want to avoid.’’
Henriquez, who started at HUD last June, is advocating for federal legislation that would dramatically change how public housing is funded. The proposal, known as the Preservation, Enhancement, and Transformation of Rental Assistance Act, would allow housing authorities to take out mortgages to fund improvements and keep current projects afloat.
The complex bill also aims to simplify the federal housing bureaucracy, currently bogged down with 13 rental assistance programs, and provide low-income tenants more of a choice in where they live.
The Obama administration says it supports the plan in hopes of saving public housing units, which are being sold and demolished at a rate of about 10,000 per year. In Massachusetts, about 2,045 public housing units have been lost over the last decade, HUD officials say.
“We are bringing public housing into the world of real estate,’’ said Henriquez. “We are unleashing untapped equity.’’
But the legislation is already spurring criticism and concern as local housing officials and advocates pick apart the details.
Aaron Gornstein, the executive director of the local nonprofit Citizens’ Housing and Planning Association, said the bill is needed to help chronically underfunded housing projects. But he wants to know more about such issues as how to keep units public in perpetuity, and how the law handles properties that go into mortgage default.
“This would be the biggest change to public housing since the program started in 1937,’’ Gornstein said.
Lydia Agro, communications director for the BHA, said local officials have “serious concerns’’ about the bill’s provisions for tenant protections, waiting lists, and subsidies for individual projects. “There are a lot of details that need to be talked about, worked out, and discussed,’’ she said.
Henriquez, who is traveling around the country to talk about the bill, said the Obama administration is eager to help craft a proposal that can pass on Capitol Hill. She said she was glad to return to Boston, a city she often cites in Washington as a model of public housing.
She joined Boston Mayor Thomas M. Menino, Governor Deval Patrick, and others to celebrate the first phase of redevelopment of Washington Beech. In addition to the 206 new units, the project will eventually include 136 other “affordable housing opportunities,’’ such as rent subsidies and financial grants, to help people buy homes of their own. The idea is to offset the housing units lost as a result of reconstruction.
Menino said the new complex “makes people’s lives a little bit better.’’ Patrick said the upgrade gives residents “the kind of housing they deserve.’’
The second phase of the project is scheduled to be completed in 2012.
Jenifer B. McKim Boston Globe June 20, 2010
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