$6 Billion for Green Retrofits on Buildings

March 8, 2010 – 8:20 am

Home Star, the White House-backed plan to provide billions of dollars in incentives for home energy retrofits, now has a sibling — this one focused on larger buildings. Two U.S. senators introduced a bill yesterday that would provide up to $6 billion in rebates and tax incentives for a broad range of energy-saving features added to existing commercial and multi-family buildings.

The bill, dubbed “Building Star” and  playing off the name of the Environmental Protection Agency’s Energy Star program, would cover about 30 percent of the cost of energy-related equipment and services including energy audits, building envelope insulation, mechanical equipment upgrades, lighting and energy management and monitoring equipment. If passed, the program is expected to save building owners more than $3 billion on their energy bills annually by reducing enough peak electricity demand to avoid the need for nearly three dozen 300 MW power plants, according to a statement by Sen. Jeff Merkley, a cosponsor of the bill.

Buildings account for about 40 percent of total U.S. energy use, with the commercial sector, such as office, retail and healthcare facilities, making up 18 percent of the total.

While the energy-saving portion of the proposal will resonate with some, the bill’s supporters appear to be largely focused on its ability to stimulate job creation. The Energy Future Coalition, a Washington, D.C.-based advocacy group that was heavily involved in Building Star’s drafting, says it would create at least 125,000 jobs (see this 13-page white paper by the coalition for a more detailed look at the Building Star proposal). Much of that work would be for the construction industry, which has taken a particularly tough beating in the economic downturn. The coalition estimates the program would spur $15 billion-$20 billion in market activity.

Patrick Hughes, a spokesman for the Energy Future Coalition, said Building Star could get wrapped in with the Home Star bill, which Senate Energy and Natural Resources Committee Chairman Jeff Bingaman said earlier this week he wants to move quickly to launch. President Obama, who has called saving money through energy efficiency “sexy,” touted Home Star program in a speech on Tuesday.

By bwaun | Posted in Uncategorized | Comments (0)

Second Home Realtors: Take Note, Green Opportunities

March 7, 2010 – 5:57 pm

I’ve been writing a lot about environmental issues lately. I can’t help but to see green as more important in Second Home destinations, as what we love about these locales is often the nature. So second home locations are on the environment cutting edge in many ways.

If you are a professional Realtor serving the second home market, you need to check out this opportunity to lead: Green & Save Realtor Resources program. 

At $60 a year, the value proposition is huge with all the components to help you help your second home owners to improve their cottages and save. It gives Realtors another reason (positive) to revisit and talk with past home buyers, on a monthly basis with very little effort.

By bwaun | Posted in Second Homes | Comments (0)

No Ownership Society: Stop Changing the lending rules

March 5, 2010 – 4:28 pm

I’ve often wondered if the movie Changing Places with Eddie Murphy had a grain of truth to it? In the movie 2 guys (bankers) sit around a club room, smoking cigars and making bets on other people’s lives. They decide to see if they can up end a complete stranger’s world.

These guys might be in control of the mortgage business and real estate economy today. Because if you were trying to screw things up, creating new rules like HVCC and the RESPA revisions couldn’t come at a worse time or with worse consequences. Honestly, my staff and I have attended at least 60 hours of ‘retraining’ to understand some of the new rules, and we are all more confused than ever.

Every banker I know is scared of the changes, and consequences of breaking the rules. The penalties aren’t even clear cut. No one likes change, and new regulation is typically met with resistance and whining, but truly, we are screwing up the economy more with these new rules. Soon lenders will stop issuing pre-approvals, now that is yet another way to slow down much needed real estate sales.

This from: American Banker

The new mortgage disclosure rule is upending the first step in the process of lending to homebuyers.

Before shopping for a property, a prospective buyer typically gets a preapproval letter from a lender indicating how big a loan the person qualifies for. Real estate agents often ask for these letters so they can make sure the customer can afford the property before showing it.

Before writing the letters, lenders like to see proof of income, such as a pay stub or tax return. But under the Real Estate Settlement Procedures Act rule that took effect Jan. 1, lenders may not require such documents before giving the borrower a good-faith estimate of closing costs.

Since lenders are now being held to those estimates, they want to hold off on issuing them as long as possible. So some lenders are reconsidering or backing away from preapprovals. Without them lenders could end up wasting time on loan applications that fall out.

“If you don’t have preapproval letters, then Realtors are going to have to show people houses whether they can afford them or not,” said David Dickinson, president of Bankers Compliance Consulting Inc. in Central City, Neb.

By bwaun | Posted in Mortgage | Comments (0)

5% rebound in Home Prices in just February

March 4, 2010 – 4:38 am

Could inflation be starting or just a return to normal values?

US home prices climbed 5% in February from a year ago, despite an incoming wave of REOs that could saddle the market for another three years, according to the Clear Capital Home Data Index.

Prices grew on a yearly basis for the first two months of 2010. The 5% uptick in February bested the 2.3% yearly increase in January. However, prices remained unchanged on a rolling quarterly basis.

“If the increase in demand that preceded the end of the last tax credit is any indication, home prices may dip only slightly into negative territory before getting an added boost before the April tax credit deadline,” said Alex Villacorta, senior statistician at Clear Capital.

Prices in Providence, Rhode Island climbed 6.1% from the previous three months, the highest increase of any metropolitan statistical area (MSA). California had five of the 15 highest performing markets as Los Angeles prices gained 2.2% over the rolling quarter.

In 11 of the top 15 markets REO saturation increased by an average of 1.3%.

“We observed an expected increase in REO saturation this month as the flow of foreclosures continued to come into the market, while traditional non-distressed sales wait to be listed in the spring and summer months,” added Villacorta.

The price gains in the early months of 2010 contrast sharply with 2009, when credit lines were cinched, investments dropped in value and financial institutions facing failure dumped REOs onto the market, according to the report.

By bwaun | Posted in Uncategorized | Comments (0)

Right time to buy a Second Home? Rental Potential.

March 2, 2010 – 4:35 am

This is the question everyone seems to be asking: “Is this the right time to buy a second home?” The message depends less on your circumstances and more on your market. Has the market in the area you wish to buy fallen by more than 25%? Could you rent your dream cottage for more than the monthly expense? How much more? Last week at the distressed real estate conference I attended, many ‘experts’ opined that real estate values should be set by the revenue they can produce. So even if you do not intend to rent out your second home, you should be mindful of their rental potential when evaluating their proper pricing.

The good news is for many real estate markets, including the hardest hit (Michigan, California, Nevada, Florida) the rental revenues now equal the the sales values for many homes, even those not selling at distressed prices (bank owned and short sales). This may be another sign that the markets are at or near or maybe even beyond the bottom.

By bwaun | Posted in Second Homes | Comments (0)