Ron Fredette’s Blog

If one dwells on the thought of the Real Estate decline one may think up more than several reasons why they believe the Market appears to be declining.  Don’t think that the Real Estate Market and the declining value of the America dollar is going to lead to a Recession or another Great Depression, although they do come to mind.  Still, there are benefits for the consumer in the Real Estate market without sounding too optimistic, which I will get back to later.  The Real Estate drop in sales and prices can be directly related to the mortgage rates, supply and demand, unemployment rates, taxes, credit and so on.  While homes for purchase are readily available the demand for such homes has declined creating the issue of Supply versus Demand.

Supply and demand are easily related in the Real Estate Industry.  The demand for home reached maximum capacity in the early 2000’s.  Currently, trends nationwide are demonstrating that the now the “boom” in Real Estate has declined.  When the demand was up everything was selling and the sellers were getting top dollar.  Now, the demand has not only fallen but so has the value of properties for sale.  History shows that what goes up must come down, realistically properties will not continue to break record selling prices and record sales every year.  The market you could say is cooling down.  The Value of Real Estate and the amount of people buying Real Estate have settled and are beginning to stabilize.  Because the market is beginning to stabilize and because builders are continuing to build the demand doesn’t sufficiently support the supply.  So prices of homes for sale fall for the consumer and one is provided room for leverage when buying, thus creating a “Buyer’s Market.”  Thus, Seller’s must be more flexible with the value of their home because of external competition with other sellers.  If the home is over priced the buyer will go elsewhere and buy.  Because the desire to buy Real Estate will always exist there shouldn’t be a fear of a draught for the Real Estate Market.  Competition exists therefore to be competitive those selling property must be pliable with their properties value. 

   The benefit of the Supply outweighing the demand in the Real Estate Market is beneficial for the buyer, although there is still money to be made for the seller.  Sometimes, investing in Real Estate the investor must take a loss in order to rebound, but sellers can still make a profit off their Real Estate if they invest wisely and invest soundly.  Buyer’s on the other can can barter in order to produce the most affordable result.  Mortgage rates will probably drop again in the near future so borrowing will increase and maybe the market will change again.  Advice then for both the buyer and seller: be patient, the rush to sell or buy will just reduce the chance of making the best investment and the buyers are out there waiting to come forward for the best opportunity to make a sound investment and the sellers are there waiting for buyers to come forward.  If the supply of Real Estate increases the demand may stay neutral, but if the Supply results in lowered prices the demand will DEFINITELY increase over time. 

Going Green and Green Homes have many aspects. As part of this ongoing discussion, I am going to mention a topic not often associated with “Green Construction” - waste management. During the upgrading or construction process much waste is often be created. Frequently contractors or do it yourselfers create additional waste by not using pieces of lumber or sheet-rock that are thrown away and could be reused. While this may not seem “Green” it actually is an integral part of it! Poor or lack of good waste management procedures can overpower the benefits derived from green construction designs. Use of Eco-Friendly materials also enrich the environmentally friendly results. As an idea you could use non-toxic or low-voc paint! Simple projects that distinguish themselves as wasteful can be rethought and planned differently. Non-disposal of appliances that are still functioning is a good way to reduce waste. Better yet, offering these useful items to a charitable organization is a way of distributing the not needed item toward a useful purpose instead of the Dumpster. So, retrofitting an old room or property will increase its appeal and reduce energy consumption is not the only way to “Go Green” If one can reduce the waste, or at lease moderate it, the benefits of reduced energy consumption are not lost.

One of the easy to achieve benefits of a Green Home is energy efficiency. This can begin with simple replacement of incandescent lighting with compact fluorescents. These light bulbs cost around $2, last 6 to 10 times longer and meet the 70% energy efficiency standard. However, disposal must be handled with care. Due to the mercury content, improper disposal can destroy much of the green design benefits. Waste management is a big part of going green!

Properly designed “Green Homes” can provide significant savings, 50% – 94% in energy consumption. It’s perfectly okay to go green, one room at a time. Using energy efficient appliances is a great start. You can achieve additional benefits with good insulation and by tightening the housing envelope. Setting goals and achieving standards provided with proper planning when you add a room or attempt to create a better cost efficient design is the place to begin. By phasing in your green home design, one room at a time you will achieve great results in just a few short years. Next week let talk some more about waste management aspect of Going Green!

Meet Julie. She is a trend in today’s 55 plus homebuyer market. Research is showing us that Julie reflects the typical desires of those who have retired or are anticipating retiring soon. The over 55 market place is changing, and changing quickly. Julie is choosing a future of meaningful work that encompasses her desire for flexible work hours and a spacious maintenance free condo. She has a desire to travel and have a flexible schedule filled with choice, her choice. One thing is clear; Julie will be retiring, but will continue to be productive and active well into her 70’s. At the top of her list is to have a home that reflects her desire of freedom, she wants more time to enjoy leisure activities, be active and set new goals. This new lifestyle will be reflected in Julie’s choice into her new home community she is seeking. Are you ready to search for a new home, downsizing and seeking assistance?

We have all heard much lately of Green Home design. There is a lot to share with you on this, so I’ll post a weekly blog on this topic. First, let me state that while progress is being made, there is no National standard or National certification program at present. While there are many independent certifications programs such as Energy Star,
LEEDS (Leadership in Energy and Environmental Design) etc…for this blog lets stay with residential home construction. So, just what constitutes a Green Home? Let’s make it simple. A Green home can be thought of as a home that has three design components to it: Economic Benefits (energy efficiency), Environmental Benefits (enhance and protect the Eco System) and Health Benefits (air and quality of life issues). Let me say that you can begin your very own “Green Home” very simply and without much cost. You can start with a single room or just a single idea! In the next post I’ll give you some basics to get started and discuss energy efficiency and the economic benefits….commonly called…SAVING MONEY!

In recent new George Bush has revealed a new plan to aid the mortgage crisis.  The result of the “bailout plan” hopes to avoid future mortgage foreclosures.  With the help of the Treasury Department the Hope Now Alliance has been created, comprised of 11 mortgage companies representing about 60% of American mortgages.  The Hope Now Alliance also plans to aid in Bush’s plan to reduce the amount of foreclosures.  The plan is a preemptive strike to future risks a homeowner may encounter in the mortgage agreements such as spiking interest rates where the homeowner can no longer afford to make payments.  Also, the plan hopes to include a 5-year freeze on interest rates.  Lastly, the plan is designed for homeowners, who live in their homes, and are unable to make payments on their subprime loans when interest rates change.       

1. Utilize a Humidifier, not only will the humidity keep your skin moist but also will make the air feel warmer.

2.  Get a computerized thermostat, this will keep your in house temperature consistent.

3.  Turn down the heat.  Especially when you are out of the home. Also, use more blankets.

4.  Open the blinds of the South facing windows to allow for the most sunlight and clean the glass on the windows.

5.  Use an airtight wood-stove, so the heat isn’t escaping out and heating the outdoors.

6.  Throw down some insulation over your attic floor.

7.  Change the filter in your forced hot air furnace.

8.  Replace your furnace with a more energy efficient one.

9.  Install weather stripping on all doors, so heat doesn’t escape.

10.  Tape plastic sheets over all basement windows.

11.  Caulk leaky windows or cracks where air will potentially escape.

The home inspection on a house that has been previously occupied will more often than not reveal some unsatisfactory inconsistencies in the home.  Defects in the home can be positive for the buyer or negative.  The home inspector is not an expert in estimating the costs of fixing such defects, for this reason a professional in the area of the part of the home should be contacted for an estimate by the seller.  In fact, two or three professionals should be contacted.  The price of fixing such defects should be considered by both the buyer and seller in order to see which plan of action should be sought to fix such defects.  In some cases it isn’t worth it to fix the problem by the buyer because it can be very expensive.  But, such cases the resulting defect could be used as leverage for the buyer to ask for a decreased price based on such defects.  If the buyer is a handyman he or she may very well be able to inexpensively fix the problem with the home.  In the end defects in a home can be benefitial to a potential buyer, rather than paying more money for a new home.  

For example interest rates can be associated with the fiscal relationship between an investor, bank and a person requiring a loan.  The primary cause of the rate increase or decrease occurs between the investor and the bank.  The bank in lamest terms is selling a loan and the investor is the buyer.  For example the loan could be for $100,000.  Depending on how much demand exists for the loan the rate the buyer will receive will depend.  If a lot of demand exists then the loan will be potentially be negative for the investor and one recieving the loan in the sense that the loan will be sold to an investor at an amount higher than $100,000.  Because so much demand exists for the loan the investors must compete to buy the loan, which essentially results in a higher purchase price.  Thus, the person receiving the loan will pay more on loan.  On the opposite end of the spectrum when demand in the loan market is weak the investor will pay less for a loan, instead of $100,000 the investor may only pay $99,000.  As a result the person receiving the loan gets a discount and the investor’s yield rises as well.       

A Passive Solar home uses solar rays to heat a home.  A solar home is designed so its walls, floors, and windows collect and store heat.  Typically the home’s windows are facing (about) 30 degrees South to take advantage of te little sunlight that is provided in the winter.  The heat is then distributed throughout the home usually starting below floor level then around in a circular motion to the ceiling.  Also, Solar homes can be more efficient by being partially “burned” by earth, where part of the home is buried by soil.  Most solar homes will have a greenhouse, which is usually located near the windows facing South, this way the home can produce fresh oxygen from plants and also be self-sufficient by producing plants for food.  The exciting part is that even existing homes can be “retrofitted,” which occurs when a home is transformed into a Passive Solar home.  For a solar home to be successful in its efforts to retain heat throughout the cold winter months it must be insulated well and tightly air sealed, but it important to note that an air exchange must take place every so often every week(s) to bring in clean and fresh air.  The importance to you in New Hampshire or any location that has cold winters where heat is produced by baseboard electric or oil or forced hot air-money.  Plenty of money can be saved over the years especially with unsure and rising oil prices, the thought of a Passive Solar home should at least be considered.  In an energy consuming world your home could become self-sufficient and save you money to spend on the other joys of life.