Welcome!

Welcome to The Mitchell Team at Keller Williams Realty's Blog! We help people buy and sell homes on Boston's North Shore, and hope this site will serve as an informational hub for people looking for the most up-to-date and relevant real estate information and statistics. Enjoy and don't hesitate to contact us with questions!

Wednesday, December 29, 2010

The National Association of Realtors reflects on 2010 and prepares for 2011

REALTORS® Reflect on 2010 and Prepare for 2011

2010 has been a year of real estate contrasts. While many consumers have taken advantage of historic buying opportunities and the market has seen a gradual stabilization of sales and prices, other challenges facing the nation have led some to question the value of homeownership for families, communities, and the country.
 
“People are passionate about the American dream of homeownership, and this passion underscores how important homeownership is to our nation,” said National Association of REALTORS® President Ron Phipps, broker-president of Phipps Realty in Warwick, R.I. “Owning a home has long-standing government support in this country because homeownership benefits individuals and families, strengthens our communities, and is integral to our economy. As we begin a new year, REALTORS® remain committed to ensuring that our public policies promote responsible, sustainable homeownership for all of our futures.”

In the first half of the year, the extended $8,000 first-time home buyer tax credit and expanded home $6,500 tax credit for repeat buyers helped encourage sales and stabilize home prices. Home buyers in 2010 have also benefited from historic affordability levels, with the combination of record low mortgage rates coupled with rising household incomes. The NAR Housing Affordability Index currently shows that a median-income family with a down payment of 20% has 184.2% of the income required to purchase a median-priced home.

“Low interest rates mean real money for today’s home buyers,” said Phipps. “Buyers who purchased a median-priced home five years ago with an FHA mortgage requiring a 3 percent down payment would have a monthly mortgage payment of $1,650. With today’s interest rates and median home prices, that same buyer would pay $1,150 per month—a $500 savings. That’s a savings of $6,000 per year.”
Despite record affordability and buyer incentives, rising foreclosure rates and concerns about proper foreclosure procedures led some to question whether owning a home was a good personal decision.
“Homeownership didn’t create the foreclosure crisis—Wall Street greed and irresponsible lending practices did,” said Phipps. “The decision to own a home is a very personal one, but over the long term, owning a home is one of the best ways to build long-term wealth, in addition to providing numerous social benefits that include reduced crime rates, improved childhood education, and increased stability. After all, a fixed-rate mortgage might last 15-30 years; renting is forever.”

Government support of programs and initiatives that encourage homeownership have also been called into question. The deductibility of mortgage interest is one example, with critics suggesting that the mortgage interest deduction (MID) primarily benefits the wealthy, while in fact, the MID benefits primarily middle- and lower income families—almost two-thirds of those who claim the MID are middle-income earners. Sixty-five percent of families who claim the MID earn less than $100,000 per year, and 91% who claim the benefit earn less than $200,000 annually.

“The ability to deduct the interest paid on a mortgage can mean significant savings at tax time,” said Phipps. “For example, a family who bought a home this year with a $200,000, 30-year, fixed-rate mortgage, assuming an interest rate of 4.5 percent, could save nearly $3,500 in federal taxes when they file next year. That’s money they could use to pay down other debts, supplement their children’s college savings account, or put into savings themselves.”

Despite current economic challenges, most Americans still aspire to the dream of homeownership. According to a survey conducted earlier in the year by Bankrate.com, 90% of respondents said they had no regrets buying their current home. And just this month, a Fannie Mae survey found that most Americans—both those who currently own their homes and those who rent—strongly aspire to own a home and to maintain homeownership.

“We believe that anyone who is able and willing to assume the responsibilities of owning a home should have the opportunity to pursue that dream, and looking forward, REALTORS® will continue to engage policymakers and industry leaders on behalf of consumers in pursuit of that goal,” said Phipps.

For more information, visit www.realtor.org.

Tuesday, November 2, 2010

You Are Royalty

This excerpt is from "How many people does it take to make a difference? One", a book printed and distributed by Starbucks in 2009. It's a wonderful passage and really puts your everyday troubles into perspective! We wanted to share it:

If you have food in your refrigerator, clothes on your back, a roof overhead and a place to sleep...you are richer than 75% of the world's population.

If you have a little money in the bank or spare change in a dish someplace...you are among the top 8% of the world's wealthy.

If you can drink from your kitchen faucet whenever you want...you are more fortunate by far than 1.5 billion people who have no access to clean water at all.

If you can attend a church or political rally without fear of harassment, arrest, torture or death...you have the kind of freedom denied to more than three billion people in the world.

If you can read this message, you are more blessed than two billion people who cannot read at all.

If your everyday problems are weighing you down, there are millions of people on Earth who would gladly trade places with you right now--problems and all--and feel they have been royally blessed.

            Remember: "From those to whom much is given, much is expected."

Friday, October 29, 2010

Mortgage Shopping 101- Making Sense of the Mortgage Market


RISMEDIA, October 4, 2010 - Shopping for a mortgage can be time-consuming and difficult for homebuyers, especially in today’s market where many buyers don’t know where to begin. The Federal Reserve Board has put together the following tips so that you can make sense of the mortgage market and be sure you are getting the mortgage that is right for you. 

1. Know what you can afford. Review your monthly spending plan to estimate what you can afford to pay for a home, including the mortgage, property taxes, insurance, and monthly maintenance and utilities. A worksheet for developing your monthly spending plan can be helpful so that you can plan ahead and save for emergencies as well as be sure you will be able to afford your monthly payments for several years. Be sure to check your credit report to make sure that the information in it is accurate.

2. Shop around
—compare loans from lenders and brokers. Shopping takes time and energy, but not shopping around can cost you thousands of dollars. You can get a mortgage loan from mortgage lenders or mortgage brokers. Brokers arrange mortgage loans with a lender rather than lend money directly; in other words, brokers sell you a loan from a lender. Neither lenders nor brokers have to find the best loan for you—to find the best loan, you have to do the shopping

3. Understand loan prices and fees.
 Many consumers accept the first loan they are offered and don’t realize that they may be able to get a better loan. On any given day, lenders and brokers may offer different interest rates and fees to different consumers for the same loan, even when those consumers have the same loan qualifications. Keep in mind that lenders and brokers also consider the profit they receive if you agree to the terms of a loan with higher fees, higher points, or a higher interest rate. Shopping around is your best way to avoid more expensive loans.

4. Know the risks and benefits of loan options. Mortgages have many features—some have fixed interest rates and some have adjustable rates; some have payment adjustments; on some you pay only the interest on the loan for a while and then you pay down the principal (the loan amount); some charge you a penalty for paying the loan off early; and some have a large payment due at the end of the loan (a balloon payment). Consider all mortgage features, the APR (annual percentage rate), and the settlement costs. Ask your lender to calculate how much your monthly payments could be a year from now, and 5 or 10 years from now.

5. Get advice from trusted sources.
 A mortgage loan is one of the most complex, most expensive financial commitments you will ever assume—it’s okay to ask for help. Talk with a trusted housing counselor or a real estate attorney that you hire to review your documents before you sign them.

For more information, visit www.federalreserve.gov.

Copyright© 2010 RISMedia, The Leader in Real Estate Information Systems and Real Estate News. All Rights Reserved. This material may not be republished without permission fromRISMedia.
James & Patricia Mitchell
Keller Williams Realty
Office: 978-233-2944
Mobile: 978-314-2955
MitchellTeamkw@gmail.com
http://www.themitchellteamkw.com/

Tuesday, October 26, 2010

Existing Home Sales Show Another Strong Gain in September

RISMEDIA, October 26, 2010—Existing-home sales rose again in September 2010, affirming that a sales recovery has begun, according to the National Association of Realtors. Existing-home sales, which are completed transactions that include single-family, townhomes, condominiums and co-ops, jumped 10.0% to a seasonally adjusted annual rate of 4.53 million in September from a downwardly revised 4.12 million in August, but remain 19.1% below the 5.60 million-unit pace in September 2009 when first-time buyers were ramping up in advance of the initial deadline for the tax credit last November.

Lawrence Yun, NAR chief economist, said the housing market is in the early stages of recovery. “A housing recovery is taking place, but will be choppy at times depending on the duration and impact of a foreclosure moratorium. But the overall direction should be a gradual rising trend in home sales with buyers responding to historically low mortgage interest rates and very favorable affordability conditions,” he said.

According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage fell to a record low 4.35% in September from 4.43% in August; the rate was 5.06% in September 2009.

The national median existing-home price for all housing types was $171,700 in September, which is 2.4% below a year ago. Distressed homes accounted for 35% of sales in September compared with 34% in August; they were 29% in September 2009.

NAR President Vicki Cox Golder, owner of Vicki L. Cox & Associates in Tucson, Ariz., said opportunities abound in the current market. “A decade ago, mortgage rates were almost double what they are today, and they’re about one-and-a-half percentage points lower than the peak of the housing boom in 2005,” she said. “In addition, home prices are running about 22 percent less than five years ago when they were bid up by the biggest housing rush on record.”

To illustrate the jump in housing affordability, the median monthly mortgage payment for a recently purchased home is several hundred dollars less than it was five years ago. “In fact, the median monthly mortgage payment in many areas is less than people are paying for rent,” Golder said.

Housing affordability conditions today are 60 percentage points higher than during the housing boom, so it has become a very strong buyers’ market, especially for families with long-term plans. “The savings today’s buyers are receiving are not a one-time benefit. Buyers with fixed-rate mortgages will save money every year they are living in their home—this is truly an example of how homeownership builds wealth over the long term,” Golder added.

Total housing inventory at the end of September fell 1.9% to 4.04 million existing homes available for sale, which represents a 10.7-month supply at the current sales pace, down from a 12.0-month supply in August. Raw, unsold inventory is 11.7% below the record of 4.58 million in July 2008.

“Vacant homes and homes where mortgages have not been paid for an extended number of months need to be cleared from the market as quickly as possible, with a new set of buyers helping the recovery along a healthy path,” Yun said. “Inventory remains elevated and continues to favor buyers over sellers. A normal seasonal decline in inventory is expected through the upcoming months.

A parallel NAR practitioner survey shows first-time buyers purchased 32% of homes in September, almost unchanged from 31% in August. Investors were at an 18% market share in September, down from 21% in August; the balance of purchases were by repeat buyers. All-cash sales were at 29% in September compared with 28% in August.

Single-family home sales increased 10.0% to a seasonally adjusted annual rate of 3.97 million in September from a pace of 3.61 million in August, but are 19.5% below the 4.93 million level in September 2009. The median existing single-family home price was $172,600 in September, down 1.9% from a year ago.

Existing condominium and co-op sales rose 9.8% to a seasonally adjusted annual rate of 560,000 in September from 510,000 in August, but are 16.2% lower than the 668,000-unit level one year ago. The median existing condo price was $165,400 in September, down 6.2% from September 2009.

Regionally, existing-home sales in the Northeast increased 10.1% to an annual pace of 760,000 in September but are 20.8% below September 2009. The median price in the Northeast was $239,200, which is 1.4% below a year ago.

Existing home sales in the Midwest jumped 14.5% in September to a level of 950,000 but are 26.4% below a year ago. The median price in the Midwest was $139,700, down 5.2% from September 2009.

In the South, existing-home sales rose 10.6% to an annual pace of 1.77 million in September but are 14.9% lower than September 2009. The median price in the South was $149,500, down 2.6% from a year ago.

Existing-home sales in the West increased 5.0% to an annual level of 1.05 million in September but are 16.7% below a year ago. The median price in the West was $213,600, which is 4.9% lower than September 2009.


For more information, visit www.realtor.org.

RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com.

Monday, October 11, 2010

National Civil Rights Groups Renew Call for Immediate Moratorium on All Home Foreclosures

RISMEDIA, October 8, 2010—National civil rights groups, including the Leadership Conference on Civil and Human Rights, the National Fair Housing Alliance, National Council of La Raza, the NAACP, and the Center for Responsible Lending, are renewing their April 2007 call to institute an immediate national moratorium on foreclosures. The civil rights groups believe that until lenders demonstrate that they are adhering to all existing laws, regulations, and contractual guidelines related to loss mitigation and foreclosure legal process, lenders in all 50 states should not move forward with any foreclosures. According to the groups:

• Across the country, lenders are announcing temporary foreclosure moratoria and attorneys general are calling for the same because of systemic illegal foreclosure filings and misrepresentations. Many homes were foreclosed upon based on banks’ fraudulent or inaccurate documentation. While the extent of the fraud continues to be revealed, many lenders have instituted no foreclosure stop at all, and no lender has yet issued a national moratorium.

• Research demonstrates that just as communities of color were more likely to receive predatory subprime loans, they also suffer more from foreclosures. As devastating as it has been for too many American families, the foreclosure crisis has disproportionately impacted communities of color. According to recent research by the Center for Responsible Lending, African-American and Latino borrowers are 75% more likely than their White counterparts to experience foreclosure. Moreover, the higher the concentration of racial minorities in a community, the higher the rates of foreclosure.



• Neighborhoods across America are being destroyed as a result of the foreclosure crisis. The foreclosure crisis fallout is not limited to individual homeowners. Each foreclosure has enormous spillover effects, and communities, especially communities of color, are seeing their home vacancy and crime rates increase while home values and tax bases are eroded.

 
• Lenders are not equipped to handle the current volume of home defaults. A foreclosure moratorium will give them a chance to develop adequate systems and capacity to preserve homeownership. The groups are calling on Congress to investigate the widespread fraud and misrepresentation in foreclosure filings, and to revive legislation that would allow loan modifications in bankruptcy court proceedings.

 
• All lenders must be required to evaluate homeowners for loan modifications and other solutions, with strong transparency and accountability. Lenders who participate in the government’s foreclosure prevention program (HAMP) or handle government-insured loans are already required to do so. Homeowners must also have recourse when their lenders deny loan modifications leading to unnecessary foreclosures.

 
Statements of Supporting Organizations:

 
Statement of Wade Henderson, President & CEO of the Leadership Conference on Civil Rights

 
“The problem of foreclosure fraud with lenders’ wrongfully manipulating essential data was entirely foreseeable. Several years ago we urged Congress to make a simple change to bankruptcy laws that could have kept countless families in their homes. If we don’t take drastic measures now, we can expect millions of additional foreclosures in the coming years, with a disproportionate number of them involving Latino and African-American families.”


Statement of Shanna L. Smith, President & CEO of the National Fair Housing Alliance:

 
“We can draw a direct line from the history and patterns of segregation in America to the disproportionate effects of this crisis on communities of color. For decades, we have asked lenders to provide fair and affordable credit to underserved communities. Instead, these communities were deluged with toxic credit and we’re experiencing the fallout today. Our call for a national moratorium on risky subprime loans went unheeded three years ago. In the intervening time, most attempts to mitigate foreclosures have proven to be unsuccessful while more and more people defaulted on loans. We hope that our call for a national halt on all foreclosures will be implemented today.”


Statement of Hilary Shelton, Director of the Washington Bureau for the NAACP:



“The foreclosure crisis has decimated American neighborhoods across our nation, and it has had a disproportionate effect on racial and ethnic minority families. Experts and scholars now project that it will take decades for communities of color to recover from the crisis. Racial and ethnic minority Americans have historically been the hardest hit by economic crises and that is certainly true today. The civil rights community warned the nation three years ago that if nothing was done to intervene that the crisis would impose the greatest loss of wealth ever experienced by the African-American and Latino communities. Sadly, this is being borne out.”



Statement of Janet Murguia, President and CEO of the National Council of La Raza:
“Latino and African American families have been deeply harmed by the economic crisis through the loss of homes, jobs, and entire neighborhoods. Families continue to experience losses that extend well beyond the physical house to concerns over their children’s physical, mental, and emotional well-being, and the evaporation of the family’s financial security. Our communities were targeted by predatory lenders. As a result, more than 1.3 million Latino families will lose their homes to foreclosure by the end of the crisis. Foreclosure prevention programs are not working, foreclosure rescue scams are rampant in our communities, and now fraudulent documentation is leading to a new wave of foreclosures. Enough is enough.”


Statement of Michael Calhoun, President & CEO of the Center for Responsible Lending:

“When we first issued our call three years ago, the industry responded by stating that we were crying wolf, that the foreclosure problem would be contained. They were wrong, and as a result, we have had millions of preventable foreclosures. What’s more, our research reveals that African-Americans and Latinos are almost 75% more likely to experience foreclosure than Whites. We cannot allow this injustice to continue. Mortgage servicers and lenders must work to preserve homeownership when possible; when not possible, they must follow the law when foreclosing.”






For more information, visit http://www.nationalfairhousing.org

Friday, October 1, 2010

How to Be Happy...

Found this great excerpt about what we can learn from our dogs! Thought it was awesome and wanted to share.

My dog is in a state of almost continuous delight and discovery, so I decided to study his attitude to see what he was doing that I was missing:

  • You will not find my dog wasting his energy nursing a worry.  He has no sense of the past or future.
  • My dog doesn't need to impress anyone or prove himself.  He is what he is, and that is enough.
  • My dog doesn't hold grudges.  A psychologist once said that a healthy amount of time to feel a negative emotion is five to eight minutes.  If it lingers past that, you are holding onto something too long.  My dog could have told him that.
  • When my dog gets tired during long walks, I pick him up and carry him for awhile.  Harboring no guilt or feelings of unworthiness, he does not protest, "You really don't need to do this." Or "I will carry you tomorrow." He just lies in my arms, and soaks it in.  He knows he is worth the love he receives, and he accepts it.
  • My dog gives me the same wholehearted greeting no matter how long I have been away.  When I come home after a long time, he doesn't sit on his haunches with his arms folded and soberly announce, "I think its time we discussed your commitment to our relationship."  He is just happy to see me, and he lets me know it.
  • I never have to guess at what's on the mind of my dog: When he is happy, he wags his tail.  If he isn't feeling well, he cries.  When he wants to play, he jumps into my lap.  When he doesn't feel like playing, he walks away.
  • My dog knows its okay to ask for what he wants-- even though sometimes he doesn't get it.
  • If I would just focus on my goals as intently as my dog focuses on the ball I'm about to throw, I could get everything I ever wanted.
  • My dog trusts that life will take care of him, so he doesn't struggle.
  • My dog knows that his purpose in life is to enjoy the adventure.  He finds joy wherever he is.
  • Insofar as I can tell, my dog is an enlightened being--yet he doesn't read a lot of books; he has never gone to a seminar, and would probably have a problem balancing his checkbook.  Perhaps, if I play my cards right, one day I will wake as happy as he seems to be.
                        -from Are You As Happy As Your Dog? by Alan Cohen

Tuesday, September 28, 2010

Five Great Tips to Close the Deal

In our market, competition for buyers is high and sometimes the seller may need to look at sweetening the pot, so to speak, to get the deal done.

As a member of the Top 5 in Real Estate Network®, sellers often ask me or a member of my team what they can do to help make their home stand out among the sea of homes currently listed. The following are five creative ideas that I, along with my team, believe might just help close the deal.

1.) Offer a Decorating Allowance
There may be a buyer that likes your home but just has different decorating tastes. To seal the deal, offer a decorating allowance (for painting, new carpets or wallpaper). You can also offer cash at closing, or put money in escrow to reimburse decorating and remodeling expenses made within 90 days of closing, up to a maximum amount.


2.) Do a Pre-Sale Inspection
This actually works for both the seller and the buyer. By having a whole house inspection done before listing the home, you get a chance to address any issues before prospects see the home. That means you increase the home's salability. Display the report during open houses and highlight the repairs that have already been addressed. It's like seeing the repair history when you buy a used car; it makes you feel better about making an offer because you know the car is in good shape and exactly what has been repaired in the past. By having the home inspected before listing it, people don't have to guess what kind of condition it is in -- they can see it in writing.


3.) Offer a Home Warranty
A home warranty reassures the buyer that the property is in top condition and gives them comfort knowing that certain future repairs will be covered by insurance. Buyers fear that as soon as they buy the house, the dishwasher, dryer or stove will go on the fritz. A home warranty is an inexpensive way to offer peace of mind to the buyer.


4.) Cover Closing Costs
Sometimes, it takes a little nudge to close the deal. You can offer to pay the buyer's half of the title and escrow fees or prepaid interest charges. Paying the points on the loan may also be a tax deduction for you. Many lenders may limit how much of the closing costs you can pay, but if the buyer is short on cash, offering to pay some closing costs can make a difference.


5.) Offer Seller Financing
There are many ways to offer seller financing. Options include putting funds in escrow to cover several months of mortgage payments, buying down the mortgage rate or carrying a second mortgage to cover the down payment. It is wise not to offer seller financing unless you have consulted a real estate attorney and your real estate agent. Make sure the buyer has good credit. Although this is the least attractive option to the seller to get a deal closed, sometimes it takes creativity and going the extra mile to get your home sold.


For more tips on selling a home, please e-mail our team. I encourage you to pass this e-mail along to your friends and family as well.


http://www.themitchellteamkw.com/

Monday, September 20, 2010

Looking for Volunteering Opportunities?

These seem to be hard times for a lot of us and if you're looking for an opportunity to give back in this time of great need, there are a number of wonderful organizations on the North Shore that are always looking for volunteers and/or financial contributions:

Beverly Bootstraps Community Services

Beverly Bootstraps Community Services provides critical resources to families and individuals so they may achieve self-sufficiency.  We offer emergency and long-term assistance including: access to food, housing stability, adult and youth education, counseling and advocacy.  We are community funded and supported.

Website: www.beverlybootstraps.org
Phone: 978-927-1561              
Address: 371 Cabot Street, Beverly, MA 01915



Healing Abuse Working For Change (HAWC)

The purpose of HAWC (formally Helping Abused Women & Children) is to create social change by taking action against personal and societal patterns of violence and oppression.  HAWC provides services and support to victims of domestic violence residing in 23 cities and towns on Massachusetts' North Shore in order that they may make informed, independent decisions about their future.

Website: http://www.helpabusedwomen.org/
Phone: 978-744-8552
Address: 27 Congress Street, Salem, MA 01970


North Shore United Way

The North Shore United Way is a unique organization.  We are a local, independent United Way, working within our own communities.  Our mission is to improve lives by mobilizing the caring power of the communities in which we work.  We focus our resources on five areas of Critical Need: Basic Needs, Housing, Health Care, Child and After School Care, and Youth Substance Abuse.  We raise funds and direct those funds locally to help our own neighbors through our strategy of Local Giving, Local Impact. We also utilize a Grant Allocation process that engages community volunteers to conduct rigorous reviews of each program's goals, outcomes and financial management before funds are allocated.

Website: http://www.nsuw.org/
Phone: 978-922-3966
Address: 248 Cabot Street, Beverly, MA 01915


Wellspring House

Since 1981, Wellspring House has been helping families move out of poverty.  Serving Cape Ann, Wellspring embodies its mission by providing these services in a spirit of hospitality: transformative adult education and job training, promoting and providing affordable housing, family education and support, and emergency shelter for homeless families.

Website: http://www.wellspringhouse.org/
Phone: 978-281-3558
Address: 302 Essex Avenue, Gloucester, MA 01930

The Mitchell Team is proud to support these amazing charitable organizations in our "Helping You Give Where You Live" Innitiative.  For every house we sell, we make a donation to one of these organizations (or an organization of our client's choosing) in our client's name.  This is just one small way were are trying to give back to the community we live and do business in!

Thursday, September 16, 2010

Why Some Houses Sit While Other Houses Sell



Watch this useful video from Jay Papason, VP of Keller Williams Realty and author of many Real Estate top-selling books, talk about why some houses sit on the market while others sell quickly. It's not enough just to put your house on the market!

Friday, September 3, 2010

Rebuttal to Time Magazine's September 6, 2010 Cover Story Entitled "Rethinking Homeownership: Why Owning a Home May Not Make Economic Sense"

From Brian Summerfield on Realtor Magazine’s Blog, “Speaking of Real Estate”:

• Mr. Summerfield reviews the main points in author Barbara Kiviat’s - “Rethinking Homeownership” article and analyzes the large holes in her arguments. Ms. Kiviat’s four main points were:

1. The US government incentivizes homeownership and shouldn’t

2. Homeownership encourages sprawl

3. The social benefits of homeownership are negligible

4. A home is not necessarily a safe investment

• “The institution of homeownership did not cause the housing boom and bust. This was due more to special circumstances in the financial sector than it was to people wanting to own a home. The hazardous mortgage lending environment was largely a product of Wall Street’s efforts to bring in vast amounts of capital for investment without properly assessing risk. Without that, the housing bubble could never have been inflated to begin with.”

• “Perhaps her most compelling argument is that the government distorts demand for homeownership through incentives. To be sure, there is room for honest disagreement about what and how much the government should do in the housing sector. But even here, Kiviat comes up short. First, she says ‘Washington lavishes homeowners with special treatment.’ But compared to whom, exactly? Senior citizens? Manufacturers? The big investment banks that played a central role in the housing bubble? Why target home owners over any of these other groups? Near the end of the article, she vaguely advocates using ‘the levers of the government to help create high-quality jobs.’ Wouldn’t that also be ‘lavishing special treatment’ on American workers, the majority of whom are presumably home owners?”

• “In addition, the rise of suburban and exurban sprawl cannot be explained solely by American’s penchant for single-family houses, which exist in major cities too. (Plus, there’s no shortage of apartment complexes and townhomes in many suburbs.) Infrastructure investments, inexpensive land, and lower cost of living also played a role in development of the outer rings of metropolitan areas.”

• “She [Kiviat] asks if we should ‘realize that both home and car ownership are probably markers of something else, like a stable family life or living in a nice neighborhood?’ She means this question to be rhetorical, but it really isn’t. One could easily turn it around: Shouldn’t we realize that a stable family life or living in a nice neighborhood are probably markers of home and car ownership? Can Kiviat or any other person making a ‘case against homeownership’ provide a common, clear-cut example of a stable family life and a nice neighborhood not being accompanied by large rates of homeownership?”

Summerfield’s whole blog post and the comments that follow can be found at: http://bit.ly/b2aX82

 From Vicki Cox Golder: President of the National Association of Realtors: “Letter to the Editor—The Case for Homeownership, Response to TIME Magazine”:

• “There’s a reason owning a home has long-standing government support in this country—because housing helps drive the economy and sustains families and communities, through good times and bad.”

• “Homeownership did not create the foreclosure crisis—Wall Street greed and irresponsible lending practices did…Homeowners have helped revitalize urban centers, bringing amenities and public services for the benefit of all.”

• “The positive impact of homeownership on society has been well documented; extensive research from government agencies, industry, and academia has shown that homeownership contributes to stable communities, helps reduce crime and improves academic achievement.”

• “All of this debate ignores the real issue facing the nation’s economy right now—that many Americans can’t find meaningful work to support their families. Housing cannot recover until jobs return to the economy. A focus on job recovery is what’s needed right now, not misguided attempts to dismantle support for something that has helped sustain this country and its communities through the Great Depression and beyond.”

The whole letter to the Editor of Time is very good and can be viewed at: http://bit.ly/bSOkUP

 Article in USA Today by Vicki Cox Golder (published on June 21, 2010): “Opposing view on real estate: It’s still the American Dream”:

• “There’s a reason homeownership is called the American Dream. U.S. history is replete with instances of government support of homeownership, from the Homestead Act during the Civil War to the G.I. Bill after World War II.”

• “There’s no doubt we need to restructure entities such as Fannie Mae and Freddie Mac, and improve government regulations of the mortgage lending industry. However, owning a home has government support in this country because homeownership benefits individuals and families, strengthens our communities and is integral to our nation’s economy.”

• “The Federal Housing Administration, Federal Home Loan Banks, and Fannie Mae were all created during the Great Depression, the worst economic crisis our country ever faced. Lawmakers back then understood the value of homeownership in fostering communities, creating social stability and building wealth over the long term.”

• “Academic studies have shown the positive social benefits of homeownership, including lower juvenile delinquency rates, lower teen pregnancy rates, and higher student achievement among children of homeowners versus that of non-owners of similar socioeconomic backgrounds.”

• “…people who bought within their means with the intent to stay in their homes for more than a few years have the opportunity to build financial stability into the future. A fixed-rate mortgage might last 15 to 30 years; renting is forever.”

The whole article can be found at: http://bit.ly/9M4sbH



Researched, compiled & edited by: Maddy Mitchell - The MITCHELL TEAM at Keller Williams Realty

Monday, August 30, 2010

Home Improvement Trends

This report on housing trends was generated by a Senior Loan Officer at Prospect Mortgage.

According to Fitch ratings, home improvement spending will increase 3.5% in 2010 over 2009 levels. This spur of activity is largely attributed to the first-time homebuyer incentives.

Existing home sales are traditionally a strong driver of home improvement spending, as sellers often renovate and buyers often remodel. Existing homes sales fell 13.1% in 2008, rose 4.9% in 2009 and are expected to rise 2.5% in 2010.

Current home improvement trends highlight those with universal appeal and a reasonable price tag. Seven of the top 10 projects, according to Remodeling Magazine's Cost vs. Value Report, were exterior replacement projects such as windows, doors and siding. This is because curb appeal is king. Topping the list were a steel entry door, with a project return of 128.9%, and fiber-cement siding, with a project return of 83.6%.

Increasing the number of bedrooms is also popular because adding space adds value. Converting an attic into a bedroom jumped to the third spot in cost recouped. With a costly average price tag of $49,346, it is nevertheless the least expensive way to add conditioned living space. The project provided a return of 83.1%.

Inexpensive ways of sprucing up the home, such as painting, cleaning carpets and replacing old fixtures, are popular. Improvements that increase energy efficiency and cut down on utility bills are getting a big boost because of their eligibility for federal tax credits through the end of 2010. Certain appliances also qualify for state rebate programs.

Home improvement spending is anticipated to grow. The Leading Indicator of Remodeling Activity (LIRA) anticipates growth accelerating to the double-digit range in the first quarter of 2011.

Monday, August 23, 2010

New Face of Housing

We found these demographic housing trends and projections fascinating! Our country and our real estate market will change in profound ways in the coming years. Read on for excerpts from "New Face of Housing" from Builder Magazine:

A changing population will require new thinking about where and what you build.

• The population in the U.S. will continue to grow—adding another 100 million people by 2040. It is expected that, between now and 2025, 85% of net household growth will consist of childless households. Households without children are the largest group even now, comprising nearly 70% of the total; a subset of that number, married couples without children, stands at about 28%. The number of households made up of married couples with children: 21%. These statistics should make you think twice about who you are building for and marketing to!

• Whether you call them Gen Y, Echo Boomers, or Millenials, the group born between the years 1981-1999 is poised to change the face of housing in this country. This cohort will start buying their first homes within the next few years. If they buy at the rate that generations before them have, it is estimated that "there will be more first-time home buyers in the market in 2013-2018 than ever before."

• In 1978, 60% of college graduates were men--today, the reverse is true. And, women are now the majority in the workforce. By 2015, it is predicted that WINKS (Gen Y women with incomes over $50,000 a year and no kids) will dominate the urban landscape. Winks prefer urban or "urbanite" areas for both home and work, with the option of walkability or easy proximity to transit. Even more important, they say they are willing to pay a premium for it.

• Minorities will be the new majority in the U.S., and many of them are forgoing settling first in so-called gateway urban areas and heading right to suburbia. In the not-too-distant future, Latinos will make up 40% of all first-time home buyers.

• A survey of buyers that asked about the most important factors when choosing a new home showed that 9 of the top 15 are what might be considered green concerns. These include energy savings, indoor air quality, and pedestrian-friendly locations.

• Take into account decreasing household sizes when designing new product.

• Know that suburbs are still very important (no matter what urbanists say), but they need to be reconfigured with gathering spaces, shopping, employment, and more.

• The most critical imperative (and perhaps the most difficult?) "Figure out what women want..."

By: Denise Dersin
Editor in Chief
Builder Magazine
August 2010 Issue

Wednesday, August 18, 2010

Homeowners and New Lead Paint Legislation

This informative article about lead paint and the EPA's new Renovation, Repair and Painting Program comes from the newsletter of one of New England's finest building suppliers: SELECTWOOD from Portsmouth, New Hampshire.

Most troubling about the new regulations, extended until October 1st, 2010, is the removal of the exemption for "Owner Occupied/No Children Under Six" rule that would have saved many homeowners from the trouble and expense that this new legislation would create.

New Guidelines for Disturbing Lead Paint

The words "lead paint" may conjure images of dust, paint chips and old homes, but lead paint is not an issue of the past. As the EPA's rules and regulations governing lead-based paint renovation, repair and painting continue to evolve; contractors will be expected to stay up-to-date on new rules and handling practices. Education is essential in ensuring contractors develop a proactive strategy when disturbing existing lead paint. One thing is for sure-- lead paint in older homes and buildings is a real problem, and it's here to stay.

Though lead paint was banned for residential use in 1978, the health issues associated with it remain. According to the Environmental Protection Agency (EPA), children under the age of six are particularly susceptible to the potentially harmful effects of lead paint chips and dust that can be disturbed during renovation. Lead can affect a child's brain and nervous system. Lead dust digestion may cause reduced IQ, learning disabilities and behavioral issues. Pregnant women can "transfer lead to their fetuses," and adults can suffer the ill-effects of low levels of lead, which include high blood pressure and hypertension.

To combat the threat of creating more lead paint dust in buildings, the EPA established the Renovation, Repair and Painting Program (RRP rule), which was published on April 22, 2008, and originally went into effect on April 22, 2010. On June 15th the EPA announced it would delay the enforcement until October 1, 2010 to allow more time for contractor training and certification. The delay in training enforcement does not mean that contractors will still not be liable for not using lead safe practices even if they are not currently certified. As the revised enforcement October 1 date draws closer, questions regarding the testing, training, and safe practices linger amoung contractors.

Aimed at contractors, painters, electricians, plumbers, HVAC contractors and other trade contractors, the rule outlines appropriate methods of containing work areas with lead based paint. Any interior or exterior surface originally painted in 1978 or earlier is considered to be contaminated by lead paint and must be tested. RRP guidelines prohibit work practices "which generate significant amounts of lead-contaminated dust. The rule requires firms working on homes built prior to 1978 receive training, complete with a certification and register with the EPA.

Even for those working to proactively adhere to the new rule, compliance is complicated. For instance, there is only one EPA-approved, LeadCheck Kit from Hybrivet Systems. The only other kit available is the State of Massachusetts Kit, available to Massachusetts certified contractors.

As the April 22 compliance date passed, concern grew over the limited availability of training classes and individuals qualified to facilitate training complicates the issue. On May 27, 2010, when April 22 was still the effective date, the Senate opted to introduce a bill (not yet passed by the house) to temporarily block fines to contractors if they aren't yet in compliance with the EPA rules. Senator Susan Collins of Maine, who sponsored the bill, said she supports efforts to "rid lead-based paint from our homes," but took issue with the burden on contractors who are not provided sufficient training opportunities from the EPA.

"The problem is there still aren't enough EPA-certified trainers in place to certify contractors," she said. "As a result, contractors face devastating fines...The intent of my amendment is to give small contractors and construction professionals more time to comply with the new rule."

The EPA has heard the concern-- though October 1 is the new effective date, contractors and renovators will have until the last day of the calendar year for training, provided they enroll by September 31. Will extra time solve the issue of training availability? Only time will tell.

Local enforceability of the new law is also in question as civic health officers and building inspeactors gain a better understanding of their role in RRP rule requirements.

According to Health Offcer/Building Inspector Kevin Kelley, based in Hampton Falls, New Hampshire, local officers grappled with their enforcement roles during a recent question and answer session with the EPA. It's become clear the onus of the RRP rule lies with local officals as much as it does with contractors and homeowners. "There is record reeping required of me too," Kelley said.

In addition to familiarizing himself with new record-keeping obligations, Kelley said he has already been working to assist local governments in integrating the RRP rule when requesting bids for work on town property.

In addition to training and enforceability, RRP rule language and definitions are already in question. Another point of confusion is the issue of high efficiency particulate (HEPA) vacuums for lead cleanup as required within the rule. Though the EPA has mandated the use of HEPA vacuums, standards for EPA-approved vacuums remain blurry. Though some vacuums bear the HEPA designation in name, vacuum leakage is a concern. Many machines with retrofitted filters are not necessarily up-to-standard.

Though feasibility of training, compliance, enforceability and semantics are still points of uncertainty, recent activity suggests the EPA is dedicated to working out the kinks and enforcing the RRP rule. Amendments to the rule that went into effect on July 6 place more responsibility on contractors' plates.

One amendment deals with the issue of "cleaning verification," which requires a comparison of a sample from a recently cleaned work area with an EPA Cleaning Verification card. Another mandate deals with resident notification, which demands contractors provide documentation of compliance and RRP training to residents in buildings undergoing renovation.

The July 6 elimination of the "opt-out" provision is the most telling sign of the RRP rule's permanence. The "opt-out" provision initially permitted homeowners in single-family residences to allow renovations without RRP rule adherence in homes there were owner-occupied and did not have any pregnant residents or residents under the age of 6.

In the future, those who aren't trained could face lawsuits, legal fees and be slammed with EPA fines that reach $37,500 per day. In addition to potential penalties, contractors will have to recalibrate the way in which they do business--extra costs associated with proper lead cleanup will need to be incorporated into quotes.

Now is the time for contractors to focus on education, training and the development of a plan to deal with the issue of lead. Lead isn't an issue of the past. It's an issue of the present, future, and an entire industry.

From: Selectwood Perspective in the Summer & Fall 2010 Issue of "Builder's Price Guide"

Tuesday, August 17, 2010

Why Using A General Contractor or Construction Manager Makes Sense for Homeowners

When contemplating a construction or remodeling project – many homeowners receive “sticker shock” when the prices come in. As a result, in an effort to save money, some are tempted to circumvent the services of a General Contractor (GC) or Construction Manager that will coordinate and manage the job. If a detailed breakdown of costs is given – homeowners often look at the general contractors fees and are tempted into believing that they can eliminate these costs and save money simply by acting as their “own GC”.

To make a professional analogy, this is like acting as your own lawyer. Ever hear how that turns out?

Yes, a general contractor earns money by adding a percentage to the subcontractor’s fees and to the materials on the project. However, the general contracting project delivery scenario will typically not cost the homeowner significantly more money and when all is said and done – it may actually cost less.

Here's why: the general contractor handles all the details from a global perspective including: client contact, negotiations, building permits and inspections, subcontractor bidding, scheduling, materials procurement, and customer billing. A professional GC will get preferential pricing from his subcontractors because they supply them with work on an ongoing basis. The GC is looking out for a homeowner’s financial interests by getting a better deal on the work than the homeowner could get for themselves.

The “General Contracting” process essentially means that the people who are good at "managing the work" do their thing and the people that are good at "doing the work" do their thing. The GC’s Project Manager supervises and schedules the specialty subcontractors to make sure efficiency through specialization is achieved.

In addition to making sure that the right subcontractors are on the job when needed, the GC is also responsible for getting them paid. Immaculate and professional work is rewarded by timely payment. A well-run job with timely requisitions for payment to the homeowner (at predetermined completed work milestones) will ensure that the subs are paid promptly and your job runs smoothly. This scenario is win-win for everyone. The result is that your job is done better, faster and for competitive prices.

When a homeowner elects to “go it alone” and hire individual tradesman to do the work, several things usually happen.

1. The homeowner pays more: Subcontractors will charge homeowners premium prices because they have learned that dealing directly with homeowners is only profitable when the fees are high.

2. The work scope changes & the price goes up: Homeowners are at risk to overpay again when the scope of work changes - and this happens on virtually every job. Whether it's from unforeseen circumstances or homeowners changing their minds, it will happen. This can be a huge "profit center" for a subcontractor because they basically have you locked into a "take it or leave it" negotiating position while your home is torn apart. Just like your auto mechanic!

3. The job takes considerably longer: When multiple subcontractors are involved, things will take longer because the project is not professionally phased and coordinated. Work gets done slowly, out of sequence, or not at all… because subs are not showing up precisely when they are needed.

4. Things go wrong: The possibilities for things to go wrong increase at an exponential rate because it's "every man for himself". No one is taking responsibility for the whole project and for the customer's satisfaction with the complete job. When conflicts arise over building standards, best practices, and possible solutions you may not get the best or most objective advice. One sub can blame another or offer you a remedy that may be in his best interest, but not necessarily yours. A subcontractor’s solution may also not be in the interest of the other tradesmen and could create more unnecessary work for them. Conflicts, contradictions and chaos. Guess who pays for all of this? Once again, no one is looking out for your best interests with respect to the whole project.

5. Problems with materials and supplies: Your suppliers don't deliver or what you received is not what you thought you ordered. If materials are not on the job when you need them – you’ll lose more time. If it was ordered wrong and was custom-made, guess who's paying for these mistakes? If subs are standing around waiting for materials, guess who ultimately pays? A good GC has far more leverage with building suppliers and getting the right products at the right time is his responsibility. And…when it is not right, he’s at risk, not you.

6. Quality Control: While some quality control issues are obvious to all – many are not. How familiar are you with industry standards and general building practices? Arcane issues with technical details and “means and methods” are not usually common knowledge among homeowners. A GC will ensure that your project – including important things hidden in the walls - are done to code and to industry standards.

7. You’re on your own with city officials and building inspectors. Who's going to make sure the inspections are done without holding up the project? If something does go wrong, a GC is far better equipped to resolve building code conflicts by virtue of their experience. Will a bunch of bureaucrats hold you up indefinitely? Will you be running in circles asking your subs for advice? If your subs installed code deficient work, who's going to pay for any inspector mandated changes?

8. Project Coordination issues and delays: When things slow down or go wrong - more of your time and your money are wasted. Are you a skilled negotiator or conflict resolution specialist? What about unreturned phone calls to the subcontractors and broken promises? You already have a full-time job… do you really need more aggravation, more dust, more noise and strangers wandering around your house for who knows how much longer?

9. Peace of Mind: The homeowner often finds themselves completely and utterly frustrated and they can lose their mind, or their marriage, or both! Quite often, after their experiences, many will emphatically say "never again!"

When you have a professional General Contractor or Construction Manager running your project, you can actually SAVE money. Getting a high quality project completed for a competitive price, considerably faster and with less aggravation is a huge plus for everyone I've ever worked with.

In conclusion, most homeowner's simply do not have the time, expertise or patience necessary to really make a construction project go smoothly and affordably. Many may try under the common perception of trying to "save a lot of money". When all is said and done however, only the smallest percentage of homeowners are successful and when you add it all up, even they probably didn't save any money - or enough money - to justify their time and aggravation.... and the job took longer!

In 25 years of being in construction, I have never heard even a single homeowner say: "I ran the job myself, it went exactly as planned and took less time and cost less money then I expected".



James Mitchell III
Design / Builder, Construction Manager / General Contractor, Realtor


Mr. Mitchell has worked for large and small Construction Managers and General Contractors for over 25 years. His writing and work have appeared regionally in: The Boston Globe, The Boston Business Journal, Banker & Tradesman, The New England Real Estate Journal, The Boston Society of Architects Chapter Newsletter and Nationally in: Engineering News Record, Ladies Home Journal, and Yankee Magazine.

Friday, August 13, 2010

Balance Shifts in Rent vs. Own Debate

Some purchasing based on 'consumption' reasons, not financial

By: Steve Bergsman, Friday, August 13, 2010.
Inman News




An associate of mine who analyzes the real estate investment trust market for Barclays Capital recently held a press conference, which he titled, "U.S. Apartment Markets: Recovery Arrives."

According to his and others' research, the multifamily housing market has finally turned the corner since the start of the economic downturn in 2007. Or, as my friend wrote, "Apartment demand has recovered more rapidly than most observers expected."

That's surely a relief for the owners of apartment buildings, but tangentially, it is also good news for potential homeowners because in the shifting metrics that contrast the value of homeownership vs. renting an apartment, the forward balance is once again with owning a residence.

The pressure on apartment owners came as a bit of a surprise. When the housing market turned and people started losing homes, it was initially assumed these former homeowners would end up renting apartments. That didn't happen.

The economic downturn was so severe that vast numbers of Americans who lost homes or jobs moved back in with family or moved in with other existing renters. They could not afford to rent an apartment on their own.

To compound the problem, so many formerly owner-occupied homes were turned into rentals that apartment owners faced a new wave of competition. The results were declining occupancies and falling rental rates.

Apparently, the bleeding has stopped in most cities and rental rates are firming up again -- except for the most severely damaged markets like Las Vegas or most of Florida.

Historically in the United States, it was always cheaper to rent than to own, but when numerous federal housing programs were introduced in the 1950s, American homeownership increased, and, according to the Wall Street Journal, by 1970 it was cheaper to buy than to rent.

The long-term appreciation of housing further imbalanced the equation. Homeownership was only around 40 percent in the United States during the 1940s, then for a 30-year period beginning in the 1960s, homeownership ranged from 60 percent to 65 percent. Coming with the new decade, a volatile combination of low interest rates, galloping appreciation and government incentives pushed the homeownership percentage to an all-time high of just under 70 percent in 2004.

Due to the tax benefit of homeownership, coupled with capital gains over the course of the last decade, at least until 2006, it was clearly less of a financial burden to own a home, said Michael Lea, the director of the Corky McMillin Center for Real Estate at San Diego State University.

"There was a strong incentive to get into homeownership, but now it is much more equalized," Lea said.

In other words, for a couple of years renting was probably the cheaper alternative --although it was close. However, the equation is shifting again and homeownership has become the less expensive alternative.

While average apartment rental rates have fallen over the past few years, the decline for the most part has been moderate. In comparison, home values in some places around the country have come down 30 to 40 percent. So deeper cuts in home values vs. rental costs, combined with low interest rates, make homeownership look good again, at least on paper.

Earlier this year, the John Burns Market Intelligence report declared: "Housing cost to income ratio dropped 25 percent, and housing affordability remains excellent compared to history," and, " Affordability is so good that owning the median-price home is now less expensive than renting the average apartment."

There are two problems with all of this: one is psychological and the other financial.

"This is probably a good time to buy, (as) mortgage rates are the lowest in a half century, but people are just not reacting to that," observed Michael Carliner, an economic consultant and visiting fellow at the Harvard University Joint Center for Housing Studies.

After decades of rampant home-value appreciation, ownership decisions had as much to do with financial gain as they did about finding the perfect place for family.

Part of homeownership is having a place to live and part of it is an investment, the latter of which morphed from a long-term stragey into short-term speculation. When the prospect of capital gains went away and negativity equity set in, that took a lot of wind out of the demand for homeownership.

"The cost of owning is dominated by capital gains, which if you are making a homeownership decision, means, 'What are your expectations?' said Carliner. "And expectations have been tarnished by recent experience. A lot of people were overconfident with capital gains -- now they are overly pessimistic."

A second psychological consideration to arise in this downturn is the entrapment predicament.

"One of the real negative consequences of the whole bursting of the housing bubble is that a lot of people are now locked into their house," said Lea.

"They don't feel then can move because of negative equity. It is a real inhibitor for people who want to move to find jobs, and probably contributes to unemployment."

The other factor in regard to buying vs. renting today is that even though mortgage rates are down, more upfront money is required and that makes buying a home costly.

As a result, Carliner offers this common-sense suggestion: If you are going to be in a location for just a year or two, the cost of buying is such a big expense that it does not make any sense to acquire; if you are going to be in a location for 10 years, you are better off buying.

Lea's son, who lives in San Francisco, was trying to decide whether he should continue to rent or to own. Lea counseled ownership, due solely to "consumption," not financial reasons -- and that he should factor out capital appreciation.

"So, he is going to end up paying more than he was in a rental, although he is only moving three blocks," Lea says. But, he's getting a nicer place; he's in control of his own environment; monthly costs are stable; and he knows he can stay there as long as he wants."

Steve Bergsman is a freelance writer in Arizona and author of serveral books. His latest book, "After the Fall: Opportunities and Strategies for Real Estate Investing in the Coming Decade," has been ranked as a top-selling real estate investment book for the Amazon Kindle e-reader.

Monday, July 26, 2010

Why You Should Buy a Home Now...Even After the Tax Credit

Why You Should Buy a Home Now… Even after the Tax Credit

While much press coverage has been given to the recent first-time and move-up buyer tax credit, there are many time-sensitive factors that make the current climate an exceptional time to buy a home…even without the tax credit.

As a Member of the Top 5 in Real Estate Network®, I, along with my team, have seen many real estate markets come and go, and we know for a fact that the many outstanding opportunities that exist for home buyers today will not be around forever.

Besides mortgage interest rates that have been hovering at near-record lows, homes in many markets have become more affordable. Prices have moderated from the highs of the housing boom that occurred in most of the country, especially in major markets where they had increased significantly.

According to the National Association of Home Builders (NAHB), new construction homes are an especially wise investment for home buyers. New homes are generally built to be much more energy efficient than homes constructed a generation ago, making them more affordable to operate. Plus, new homes often incorporate open floor plans, flexible spaces, improved safety features and low-maintenance materials—making them well-suited for today’s modern families.

So, if you’re thinking about buying a home, please don’t count on interest rates or prices staying at current levels—we’ve seen them change unpredictably and quickly! Mortgage rates are sensitive to market conditions, and even a slight increase can push monthly payments beyond a family’s budget. As the country recovers from the recession and people stabilize their financial situations, NAHB economists expect that home prices will begin to increase by 2011.

For further advice on buying a home or market conditions, feel free to e-mail our team anytime (mitchellteamkw@gmail.com). And be sure to pass this information on to friends and family who might also be considering a real estate purchase!

Friday, July 23, 2010

Helping You Give Where You Live

We are excited to announce that starting now, for every home we sell on Boston's North Shore, we will be donating a monetary contribution to a local charity, in our client's name. We like the idea of a housewarming gift that gives back to the community, and informs our clients of volunteer opportunities in the area.

We have selected five charitable organizations we want to support:

1.) Beverly Bootstraps Community Services
2.) HAWC (Healing Abuse Working for Change)
3.) Keller Williams Helping Hands
4.) North Shore United Way
5.) Wellspring House.

The videos feature interviews with the Executive Directors of each of these amazing organizations. Enjoy learning more about all the work they're doing to improve our community and how The Mitchell Team is trying to give back!

Check out the videos on Youtube:

http://www.youtube.com/user/TheMitchellTeam

Tuesday, July 13, 2010

Hiring a Contractor: Rules of Engagement

...or how to avoid getting burned on your next remodeling job


Reputable Home Improvement Contractors are licensed, insured and registered with the State of Massachusetts.

If you are about to hire a Residential Home Improvement Contractor, (or a Plumber, Electrician, Painter, etc.) it makes good sense to follow a few simple guidelines to protect yourself and avoid disappointment, frustration, lawsuits or worse.


The Mitchell Team's FOUR Rules are:

1.Hire Professionals: These individuals or companies are Licensed, Registered, and Insured by the state and private insurance companies.

2.Get a Contract: Use signed, written contracts for all jobs over $1,000.00. The contract should include:

■Their contact information (business name, address, registration/license numbers, phone numbers and the name of the salsperson and/or persons in charge of the proposed work)

■A detailed description of the work to be performed, materials used, etc.

■A proposed Start Date and an anticipated Completion Date

■The total dollar amount of the contract

■A payment schedule (by law they cannot ask for more than 1/3 of the total price, or the actual cost of special order or custom-made products upfront)

■The registration numbers of any subcontractors, if applicable

■A homeowner's 3-day cancellation provision

■A "Change Order" provision: guidelines/policy regarding any changes to the proposed work

■An Arbitration/Dispute Resolution Clause (which allows either party to initate arbitration in the event of a dispute)

■Signatures of both Owner and Contractor

3.Contractors secure building permits. (Note: if the Homeowner is expected and/or agrees to provide the building permit, the contractor must notify them that they will be barred from access to the Home Improvement Contractors Guaranty Fund. This is a fund that can be drawn upon by homeowners' when disputes arise; the limit per dispute is $10,000.00 All efforts to resolve the conflict must be exhausted prior to application for access to the fund.)

4.Do not make final payments to any contractor until all applicable city/town inspections have been performed and the building permit card has been signed. (Be sure to get a copy of the permit and building card for your records. If you need advice on what kinds of work require a building permit, call your local building department officials and ask.)



Note: for a complete list of what must be included in home improvement contracts, you can obtain a copy of Mass General Law Chapter 142a and 780 CMR R6 at the consumer affairs website: http://www.mass.gov/?pageID=ocahomepage&L=1&L0=Home&sid=Eoca

THE MITCHELL TEAM-KELLER WILLIAMS REALTY
James, Patricia & Maddy Mitchell
www.TheMitchellTeamKW.com

or find us on Facebook: The Mitchell Team at Keller Williams Realty, Beverly, MA

Monday, July 12, 2010

Futures Trading: 10 Green Housing Trends

It's hard to predict what products, technology, and systems will be important in the next 10 years, but green experts say the looming energy crisis can give us a pretty good idea.


YOGI BERRA, THE HALL OF FAMER known for his paradoxical observations, once said famously, "It's tough to make predictions, especially about the future." Indeed it is. But with all due respect to Mr. Berra, sometimes all you have to do to see the future is look around and see where there is a need, where opportunities lie, and where there will be challenges. As management guru Peter F. Drucker put it,"The best way to predict the future is to create it."

Some well known examples can be seen at Amazon (the Kindle) and Apple (the iPod). These companies understood that in an increasingly mobile world, consumers will want to transport more than one book or magazine at a time or be freed from the burden of carrying CDs.

Consumers have needs and wants for their homes, too. It's obvious that the world's growing population will require more energy and natural resources such as oil and water, which means that providing sustainable homes that use less energy and water is likely to be a continuing preoccupation for the industry. Less obvious, however, is what products, technology, systems, and practices will best accomplish this?

We decided to ask the people who pay the most attention to such things--sustainable builders, consultants, green building program officials, and LEED-certified architects--to look into the future and tell us what they see. We also gathered some of the best new ideas that keep popping up in our inboxes.

From these, we've compiled a list of 10 ideas that we think will be important in home building in the years to come. The collection is a sampling of ideas that will be pivotal in the future, but these are by no means the only ones. Take a look at our picks and let us know which of them you think will be important to the future of the home building industry.



1. The house will function as a system. "I think a piece of what green building is getting us to is not just building a house stick by stick or brick by brick but really looking at it as a system," says Amber Wood, program manager for energy efficiency at the National Association of Home Builders' (NAHB) Research Center in Upper Marlboro, MD. Simply put, everything in a house is connected. So, if you insulate better, you can use a smaller HVAC system. If you design your plumbing runs efficiently, it will save energy on heating bills. Though building scientists have been preaching about these connections for years, not many builders have paid attention. But Wood says manufactuerers are making it easier for the industry to accomplish. "There are various products and different wall types and sections that are available now that I think will become more popular," she says. "A lot of the products are going to be integrating various pieces [of the system], including air sealing and insulation in the wall."


2. Modular goes mainstream. Some builders use a fair amount of panelization for floor and roof trusses, but usage could be much higher. Carl Seville, green builder and consultant, believes this will change. "Anything like SIPs and other panelized systems that will help cut the time of building a house and improve the quality should get more popular," says the owner of Seville Consulting in Decatur, Ga. There is no debating the benefits: less waste, faster construction, fewer moisture problems. These systems may not necessarily be cheaper, Seville says, but they will result in less site management. "Builders are slow to change, but modular and panelized systems have the potential to be huge in the industry."


3. Air sealing becomes easier. "People are starting to get it that air sealing is important," Carl Seville says. And there are plenty of products available to help do it correctly. Builders could air seal houses with caulk, or they could use foam, which hits all the nooks and crannies easier and better than caulk. Foam is very effective, but it's also very expensive, so companies such as Knauf and Owens Corning are introducing new systems that give builders a way to seal that is more reliable than calk but less expensive than foam.


4. Water turns political. Most homeowners are oblivious about where water comes from or where it goes, but that's because it's cheap. Home buyers will be forced to think about water more as prices for its use and disposal increase. "Water is the topic [that's] about to burst into the forefront of the debate," says Michael Anschel, a principal and designer with green-focused Otogawa-Anschel Design-Build in Minneapolis. Look for products that eliminate septic systems and allow for the reprocessing of water on site, he says. "There are already systems available that start to do this," says Anschel, also the CEO of Verified Green, a green consulting and training company. "I expect they will become mainstream alternatives to traditional systems for new development and retrofit solutions for existing homes." Consumers should expect tougher regulations; manufacturers believe it's only a matter of time until the feds make low-flow showerheads and faucets mandatory. They also expect the government to lower the maximum allowable toilet usage from 1.6 gallons per flush to 1.28 gallons. And, "In the faucet arena, the touch-sensitive technology from Delta is something that I think will become mainstream for kitchens," Anschel says.


5. Solar becomes accessible. Solar installations are costly and often unsightly. But a new crop of solar-integrated roofing products from such companies as Dow Building Solutions, CustomBilt Metals, CertainTeed, and others are taking steps to change that. Roofing manufacturers' involvement in solar makes the systems easier and cheaper to put in place because they are installed at the same time as the roof. The seamless design of these solar-integrated products also means they will be a little more attractive. CertainTeed says it is "transforming a niche technology into a product that is more accessible to the building industry and, therefore, a broader range of homeowners."


6. High R-value windows become the new Energy Star. When President Obama signed the American Recovery and Reinvestment Act of 2009, it gave homeowners a 30 percent tax credit for qualified energy-efficient home improvements, including replacement windows that have a 0.30 U-factor and a 0.30 solar heat gain coefficient. This might just be the beginning. "Dual-pane windows were invented back in 1865. So in 1870, they were truly best of class," Kevin Surace, president and CEO of Serious Materials, told the Democratic Caucus Job Summit in January. "But I am thinking, 140 years later, and we call that energy efficient?" Serious Materials is calling for windows to be R5 or higher. "Surely R7+ will be standard," Surace says. "[It] may be code driven or simply energy-cost driven." The DOE and the American Architectural Manufacturers Association (AAMA) agrees. To help lower costs for the windows, the DOE is eyeing a volume purchase program of R-5 windows and low-E storm windows, as a way to expand the market. "Even though the energy benefits of R-5 windows are exponential, their current cost inhibits their widespread acceptance," says Rich Walker, AAMA president and CEO. The DOE program should make them more affordable, he says.


7. Hybrid water heaters heat up. Though tankless water heaters are said to be highly energy efficient, many consumers and builders aren't convinced and prefer their traditional units. Manufacturers such as Rheem, GE, and A.O. Smith are now introducing a new class of hybrid products that offers the benefits of both tank and tankless systems. Using various types of technology, the products heat water like a tankless product, but they also contain a reservoir like a tank unit. In some cases, the efficiency rating of some units is as high as 90 percent, meaning they are Energy Star rated and eligible for the federal tax credit. Energy efficiency is the driving force behind innovation in the water heater industry, A.O. Smith says.


8. Agricultural waste comes home. Today, you can buy building products made from the waste of several manufacturing sectors, but Michael Anschel believes "agricultural waste products are going to make their way into an increasing number of building products." Diverting waste from landfills is a noble deed because it eases the demand for virgin natural resources. The trend has already started with products made from the waste of sorghum, palm, and wheat production, but look for the effort to be expanded into more categories, which will offer "everything from insulation to interior finishes, flooring, to all of the millwork products," Anschel adds.


9. Energy monitoring affects behavior. Human behavior is often forgotten in discussions about conserving energy or water. Even the most efficient product can be wasteful if used improperly. That's why Kaplan Thompson Architects in Portland, Maine, included an energy feedback system in its award-winning BrightBuilt Barn, a LEED-certified, net-zero--energy building that was also used as a demonstration project for a new way to build houses. Using red, green, and yellow lights the system lets the owners know their energy usage levels. Bulbs turn green when the building is using less energy than it's producing, yellow when it's borderline, and red when it exceeds its usage goals. More sophisticated "dashboard" systems allow homeowners to see accurate energy consumption levels in real time. Studies have shown that when people see how much energy they are using, they will alter their behavior.


10. Energy modeling software shows us the way. If you are seeking LEED certification, you are required to use a computer-based "energy modeling" tool, which simulates what energy use would be for a year of operation. "This is [employed] to measure energy use of a building and to quantify the savings attributable to the proposed design," Seville says. Consultants believe the use of this tool will grow whether a builder is seeking certification or not. "Energy modeling software is very complicated and only accurate to a certain extent," Seville adds. "It will get better and cheaper. It's a terrible predictor for energy use, because behavior is the best tool, but it gives you some baseline to start from."


BY NIGEL f. MAYNARD

Source: Builder Magazine (June 2010 Issue)