2010 April

Archive for April, 2010

Replacing Knob and Tube Wiring..

April 29th, 2010 |

Author: joe

I have a house which has knob and tube wiring that is not working, so I am in the process of replacing it. Plan is to run Romex 12-2 down the walls to the outlets, and up to the attic, with each room having its own circuit (small house 2 bed 1 bath)

I plan to have 1 circuit per bedroom, 1 for the living room, and 2 for the kitchen/bath (1 outlet in bathroom) Does this seem logical? I have had the main panel upgraded, to a 200 amp service breaker box, and plan to run all the wires myself and have an electrician tie them into the box. Each bedroom has 3 outlets. Does this seem logical? am I thinking this out correctly? 5 Junction boxes in the attic, all feed by a 20amp breaker.. then I will put the dryer, stove and water heater and heater all on there own breakers.. no central air

anyone see any problems with this setup!? Im starting to run the wires and need to have it mapped out!

thanks!

-Scott

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Short sale – second bank dragging feet

April 29th, 2010 |

Author: joe

Leave it to the owners to screw themselves further

Congratulations indeed…now sell this thing and make a profit!

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Buying-Real-Estate-Foreclosures

April 29th, 2010 |

Author: joe

Buying real estate Foreclosures

When looking for a home for you and your family you will come across all kinds of deals, bargains, and so-called values along the way. If price is a very tangible object for you and your real estate investment then you might seriously want to consider the value of foreclosures. If you are hoping to invest in real estate in order to turn a profit then you may also wish to consider these properties that are often sold well below the ordinary value of the property because they are in varying degrees of disrepair.

Foreclosures are properties that have been taken back by the lenders because the previous owners were unable to continue making payments on the property. Being that these homes were often owned by those in financial distress and may have been empty for some time before being sold, chances are that the foreclosure homes being sold at any given time are in some degree of disrepair. The shabbiness of many of these properties is one of the factors that keeps the prices down. Another is the fact that the lenders are essentially attempting to recoup their investment in the property. For this reason they are often willing to take less than the value of the property if that is what is owed on the property.

Why are these properties often in a state of disrepair? Truthfully, there are many reasons but the primary culprit in this situation is money. Obviously the owners of the home were struggling to make the payments or the home would not be in the state of foreclosure. If the notes on the property were difficult to begin with it makes perfect sense that other issues such as leaking roofs, shabby carpeting, or plumbing maintenance would take a distant second in priority to making the house payment.

At the same time, there are those who are bitter about loosing their homes. As sad as the situation may be some add insult to injury by damaging these properties intentionally. These homeowners feel they have nothing left to loose and if they cannot have their property hole then the lenders should not as well. While this is by no means the way to go there are very many who choose this path over other options.

The fact is that their loss in these situations is actually your gain. The damage they do to the property is often not terribly expensive to repair though it can be quite bothersome. Your willingness to do the work in order to create a beautiful home for you and your family or as an investment can often translate to big savings at the closing table or when negotiating the price of the property. Foreclosures can allow families to buy larger homes in better neighborhoods than they would ordinarily be able to afford. They can also provide a fabulous kick-start to a property investment portfolio.

Despite common claims and Internet advertisements, you do not need to buy a list in order to find foreclosed real estate in your area. You simply need to procure the services of a competent realtor and let him or her know that your intentions are to purchase a foreclosed property or some other property that is selling well below market value. You might be amazed at the wealth of information and assistance your realtor can provide not only in finding excellent foreclosures but also when it comes to procuring financing for some of the more creatively damaged foreclosures you may run across at insane bargain prices.

PPPPP

594

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Should the Home Buyer Tax Credit Deadline be Extended?

April 26th, 2010 |

Author: joe

With the deadline rapidly approaching for the $ 8,000 tax credit for first time home buyers and $ 6,500 for repeat home buyers, there are many consumer groups who are calling for an extension. Should the real estate community lobby behind consumers and request an extension? I answer with a resolute NO.

According to a JBREC report, the tax credit was far less efficacious this spring than it was in the fall, when the deadline was originally set to expire. Key indicators, including high unemployment, increase in existing home inventory, and low consumer confidence, do not indicate that continuing tax incentives would currently give a boost to the real estate market. Buyers who were enticed to buy due to the additional financial benefits of the tax credit have already made their purchase and there is little to no evidence that the expanding the deadline will drive the economy upward. Today I had a buyer panicking that they ‘needed’ to find a house prior to the April 30 deadline, yet had absolutely done nothing (i.e. pre-approval, researching suitable properties) to show they were serious. So should the government indulge the fickle nature of some buyers? NO.

Furthermore, the real estate market crisis has become less of a national issue and more of local one (with a disproportionally large percentage of distressed properties being in a few select states, 35 counties in particular) and as such, it should be tackled on a local scale, such as California’s plan. Ultimately, the federal government can not continue to artificially inflate the economy with tax credits and low interest rates, it is simply not a long-term strategy that will sustain economic growth and stability. Not only does it take away from tax revenue, but it prevents the free market from stabilizing real estate prices. With that, let the tax credit end and the economic healing process can begin.

Should the Home Buyer Tax Credit Deadline be Extended?

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FHA Property Inspection Checklist

April 26th, 2010 |

Author: joe

As any investor who has ever sold a property to an FHA buyer knows, there is at least one mandatory FHA inspection that must be completed by the lender prior to the closing of the property.

I often get asked what types of things do FHA inspectors/appraisers look for during these FHA inspections, and what types of things will cause a property to fail an FHA inspection. I’ve had that same question in the past, so I asked an FHA underwriter that I have worked with on several occasions if he could clue me in on the types of things that are flagged during these inspections.

He was kind enough to forward me a full list of “minimum FHA property requirements,” which essentially translates to the FHA inspection checklist. While this list is by-no-means a formal checklist followed by FHA inspectors, it’s a good set of guidelines. Just because you meet all these requirements doesn’t mean you’ll pass an inspection, and just because you may not meet one or more requirements doesn’t necessarily mean you’ll fail an inspection. That’s up to the inspector/appraiser/underwriter to determine.

In other words, don’t put too much faith in this list, and don’t blame me if your inspector has other criteria that he uses…

In fact, as the document itself explains:

This list is for reference only and does not guarantee compliance with FHA Minimum Property Requirements. Minimum Property Requirements are to insure the health and safety of the occupants and/or the marketability of the property.

That said, here is the checklist/guidelines:

Site Hazards and Nuisances

Presence of the following may indicate unacceptable property condition:

Sinkholes
Active or planned gas-drilling within 300 feet
Within 75 feet of operating oil/gas well with no visible mitigation measures
Abandoned oil or gas well within 10 feet
Slush pits
Excessive noise or hazard from heavy traffic area
Dwelling or improvements within 10 feet of easement for high-pressure gas or petroleum line
Dwelling or improvements within fall distance for overhead towers (high-voltage, radio/TV, cell phone etc)
Excessive smoke, fumes, offensive noises or odors
Stationary storage tanks with more than 1000 gallons of flammable or explosive material

Soil Contamination

Presence of the following may indicate unacceptable property condition:

Surface evidence of underground storage tank
Proximity to dumps, landfills, industrial sites that could contain hazardous materials
Presence of pools of liquid, pits, ponds, lagoons, stained soils or pavement

Grading and Drainage

Presence of the following may indicate unacceptable property condition:

Grading does not provide drainage away from structures
Standing water near structures

Individual Water and Sewage Systems

Presence of the following may indicate unacceptable property condition:
Private sewage system show evidence of system failure
Separation between well and septic drain field less than 100 ft, (75 ft may be acceptable if local authorities allow.)
Separation between well and property line is less than 10 ft. (If local authority requires greater distance that requirement must be met.)
Property lacks connection to public water (Lender/jurisdiction may require water test and connection to public water if feasible)

Wood Destroying Insects

Presence of the following will require a termite inspection and treatment if infestation is present:
Structure is ground level and wood is touching ground
House or other structure show obvious evidence of infestation
Local jurisdiction requires inspection
Inspection is customary to the area

Private Road Access

Presence of the following may indicate unacceptable property condition:

Property inaccessible by foot or vehicle
Property accessible only by private road without permanent recorded easement

Floor Support Systems

Presence of the following may indicate unacceptable property condition:

Significant cracks
Evidence of water damage
Evidence of spongy/weak/rotted flooring

Framing/Walls/Ceiling

Presence of the following may indicate unacceptable property condition:

Significant cracks
Visible holes in exposed areas that could affect structure
Damaged plaster, sheetrock, or ceiling materials in homes constructed before 1978
Significant water damage

Attic

Presence of the following may indicate unacceptable property condition:

Inadequate access
Evidence of holes
Support structure damaged
Significant water damage visible from interior
No ventilation by vent, fan, or window

Basement

Presence of the following may indicate unacceptable property condition:

Blocked or inadequate access
Evidence of significant water damage
Significant cracks or erosion in exposed areas that affect structural soundness

Crawl Space

Presence of the following may indicate unacceptable property condition:
Blocked or inadequate access
Space inadequate for maintenance (recommended 18 inches)
Support beams not intact
Excessive dampness or ponding of water

Slab

Presence of the following may indicate unacceptable property condition:

Significant cracks that could affect structural soundness

Roof

Presence of the following will require a roof inspection and possible repair:

Missing tiles, shingles, flashing etc
Signs of leakage

Furnace/Heating System

Presence of the following may indicate unacceptable property condition:

Unit does not turn on
Heat is not emitted
Unusual noise
Smoke or irregular smell
Significant holes or deterioration on unit

Electrical System

Presence of the following may indicate unacceptable property condition:

Electrical switches don’t work
Outlets don’t work
Presence of smoke or sparks from outlet
Exposed frayed or unconnected wiring

Plumbing System

Presence of the following may indicate unacceptable property condition:

Significant drop or limitation in water pressure
No hot water
Toilets don’t function or have been removed
Toilet leaks
Sinks/bathtub/shower leaks (very minor leaks may be acceptable)
Sinks/bathtub/shower does not work or have been removed
Swimming pools not operational, in bad repair or not maintained

Paint

Presence of the following may indicate unacceptable property condition:

Chipped or peeling paint on interior or exterior of home and/or structures and improvements if home built before 1978.
Chipped or peeling paint on exterior surfaces if finish is unprotected (ie, bare wood) if home built after 1978.

Other

Presence of the following may indicate unacceptable property condition:

Missing or inoperable exterior doors
Broken or missing stairs
Absence of built-in appliances
Absence of free-standing stove (Santa Ana HOC only)

FHA Property Inspection Checklist

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Open Question: When Annai builders make an agreement for Anakaputhur project?

April 26th, 2010 |

Author: joe

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Open Question: Buying property in Belize?

April 26th, 2010 |

Author: joe

i am Canadian and thinking of buying some property in Belize.
First, can Canadians legally own property in Belize?
Second, what area(s) in Belize would you suggest, meaning safety, life style, weather, neighbourhood, etc.?
Are there some areas that one have to avoid?
thanks!

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Sale Contingent Upon Other Purchase

April 26th, 2010 |

Author: joe

Hi,

I would like to tie up a potential seller’s property A for an assignment. He tells me the sale of his property is contingent upon his purchase of another property B. (He apparently has an offer in on an REO or maybe a short sale.)

Can I tie up property A right now with a contract that has such a contingency written in? Will this fly, especially considering I’m going to sell the contract? Or should I wait until the seller has made the succesful purchase of property B before making my offer.

Thanks,

jp

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Are investors keeping prices down?

April 26th, 2010 |

Author: joe

Actually, it does not matter at all. Since we are talking about flip investors what you actually have is 2 comps. The first comp is for the purchase by the investor which will hurt during the short time that it takes the investor to rehap and flip the property. But then comes the resale at the true sales price, which includes the investors profit.

Most homes are on the market for longer than the business investor takes to rehab and flip, since he does this often each year.

What you really have is the homeowners emotional price being brought down by the market forces from the bubble high to the current market prices. I realize that most homeowners will not look at things this way but when they try to sell at their emotional prices they actually end up bringing down the prices of all homes in their area by having to reduce their prices until the home sells at the market prices. It is really the homeowner that is bringing down the market by holding on to their homes because they can not get what they feel that they deserve even though they had offers at the market pricing. Then they find themselves in a position of having to short sale their home which brings the pricing down below market value where an investor steps in and repairs what they would not (or could not) and makes his profit by selling at that market princing that the homeowner originally refused.

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Muslims and new Health Care Bill- not fair?

April 25th, 2010 |

Author: joe

Not much time left to reply, and then I lose internet until tomorrow in NY in the afternoon. I don’t disagree with much of what you said, J Scott.

I said earlier, no special deals of any sort -no health care exemptions or special deals to LA, Nebr etc. Same treatment for all and be able to go across state lines to purchase health insurance.

I agree health care has problems, but don’t just blame doctors or ins companies. The legal costs and risks(tort changes) need to play a part.

When I was referring to the other countries weren’t doing great, i was referring to the Socialist countries and directions we’re heading. BTW, I hate our health system, but would like to see step by step changes, not a scattergun approach done quickly with no one knowing or debating what is in it, Just plain stupid in my mind

This has been fun. I’m off BP till tomorrow afternoon at JFK for a few hours. I’ll post replies then, Egypt should be visited by all. Great history, people that seem to still like us, marvelous hotels and not expensive.(I’m thrifty, remember) Rich , coming home.

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