Tag Archive: Coester Appraisal


Strange Houses & Weird Homes

A Home Can Be So Much More Than A House

via You Live Where

house507a

This house sure is a doozy, or at least the fall from it is. The archway at the bottom, while sacrificing some stability, is a nice touch. Do you think that the designer of this house likes roofs? As if this house needed to be more top-heavy. My real question is: Where is the electricity coming from to operate that lift? I imagine that it would be a little windy all the way up there. A great little detail that just proves the amazing things people can do with Photoshop these days.

 

 

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BY BRIAN C. COESTER

REQUIRED READING: Here is the scenario: A homeowner spends $20,000 turning his home from an energy-sucking abode into an efficient, cost-savings oasis. This individual installs solar panels, ultra-efficient appliances, a tank-less water heater, energy-efficient windows and blinds, and paints the roof white. As a result, the property can now reap the rewards of almost no monthly utility bills while helping to improve the environment.
But what happens when the homeowner brings in an appraiser to value all of these new features? Do not be surprised if the appraiser tells the homeowner that the house isn’t worth any more than what it was originally.
This scenario is happening more frequently as homeowners and builders ride the atmospheric green wave to make homes more energy-efficient. There is a big problem here: The mortgage industry has not yet caught up with the green wave. It is going to take the support of both the mortgage and appraisal industries to ensure energy efficiency is valuable to the market and not just to the homeowner.
Admittedly, this is still a relatively new trend. Thus, the cost of building green is relatively high, and to a certain extent, the cost outweighs the short-term benefits. The average cost of installing solar panels on a home is $35,000 – and with an average savings of $1,700 a year, it would take approximately 20 years to recoup the total cost.
Furthermore, due to the lack of comparable sales and unknown actual cost savings by appraisers, it would be relatively difficult to evaluate the home’s energy efficiency. So what needs to be done to green up collateral valuations? There are several considerations that need to be addressed.
First, utility-bill data must be available on multiple listing services (MLS). Appraisers cannot take into account information they do not have. An MLS indicating a home is "green" means nothing to appraisers, thus making it very difficult for them to make adjustments due to unknown information.
In most states, home sellers are required to put 12 months of utility bills in the addendum of the contract. Having this information available for the appraiser on the MLS would enable an apples-to-apples comparison of the subject’s home and comparable. If a home that is "green" has utility bills that total only $1,000 a year versus a typical house that averages $4,000 a year, an appraiser is able to make tangible adjustments and give tangible value to the home.
Next, mortgage-backed securities need to give better pricing to green homes. The U.S. Department of Housing and Urban Development’s (HUD) Energy Efficient Mortgage (EEM) is a step in the right direction, but conventional lenders and the secondary market need to catch on. If lenders are concerned about the qualified residential mortgage requirements and the homeowner’s ability to pay the mortgage on a monthly basis, they should also be concerned with the utility costs.
The principal-and-interest payments on home loans do not change month to month, but utility bills do. Depending on the harshness of the weather, these monthly bills can skyrocket. 
Homeowners will default on their mortgage before they will have their heat or electricity cut off. Having homeowners with lower overall utility costs will make a significant impact on their monthly ability to pay the mortgage. For this reason, homes that are built with green items should get special pricing for being lower-risk. This would give homeowners an incentive to make the green upgrades – not only for a better mortgage product, but also monthly savings and a better environmental footprint.
Go green!
Furthermore, the appraisal industry needs to recognize the benefits of green improvements. The appraisal industry is quick to adapt to what lenders want and require, but it will not make the first move to create the curve. The industry needs to ensure that the market has clearly recognized that there is tangible value in energy-efficient homes before value will be given to them. 
Currently, there are no standards for valuing green homes. This makes it difficult to place a value on the property – after all, what are you comparing it to? Until the appraisers are supported with MLS information on recognized standards for the valuation of green homes and tangible evidence that the mortgage community places weight on green homes, appraisers will not be able to do anything.
Finally, green technology needs to be easily accessible to homeowners. Of course, this is outside of the control of lenders and appraisers, but it needs to be addressed. Energy-efficient technology is still fairly pricey, but over the next two to three years, it is likely that favorable price developments will be witnessed in solar power, solar thermal, geothermal and small wind solutions, as well as energy-efficient household appliances. If the price point is friendlier to the average homeowner’s budget, more homeowners will adopt the green home solution.
None of this will happen overnight, of course, but it is coming down the road. Lenders and appraisers need to recognize that this issue needs to be resolved before tomorrow’s solutions become more commonplace today.
Brian C. Coester is CEO of Coester Appraisal Group, based in Rockville, Md. He can be reached at (888) 485-1999.

(Photo courtesy of USPS)

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Quiz: Am I Ready to Buy?

Carla Hill, Yahoo Real Estate

There are lots of eager would-be buyers out there. It’s no wonder why! The market currently offers many ideal buying conditions. Interest rates are still at historic lows (for those with excellent credit). Home prices are extremely affordable when compared to area median incomes. There is a large supply of homes available in most markets (more homes to choose from and buyer advantage at negotiations).

Yet, the questions remains. Are you ready to buy? Take a moment to answer this ten question quiz: Am I Ready to Buy?

1. What is your credit score? (a) less than 620; (b) between 730 and 850; (c) between 620 and 730.

2. Do you have cash for a 20 percent down payment? (a) how much?; (b) yes; (c) not yet, but we’re working on it.

3. Do you have cash totaling an 8-month emergency fund? (a) I live month to month; (b) we have funds to cover 8 months of expenses; (c) we only have savings to cover a few months.

4. Have you been pre-approved for a mortgage? (a) I figured I’d find the house I like first; (b) Yes, and I have a copy of the letter; (c) I played around with forms online.

5. Is your job: (a) temporary, part-time; (b) full-time and secure; (c) full-time, but our company is experiencing lay-offs.

6. Do you plan on staying in your current city for the next 3 to 5 years? (a) I won’t be here for that long; (b) Yes, most definitely; (c) I’m not sure.

7. Have you worked on buyer budgets? (a) I don’t have time to do frivolous budgets; (b) I have a spreadsheet showing different scenarios; (c) I’ve worked up a few, but haven’t spent much time.

8. How much space do you need? (a) I want a mansion. I’ll take nothing less. (b) We know within about 500 square feet; (c) we’ve given it some thought, but aren’t sure.

9. Are you and your spouse or partner on the same page? (a) it’s my way or the highway; (b) we’ve had several lengthy discussions and agree on most points; (c) we’ve talked, but have very different ideas.

10. Why do you want to buy? (a) I want a place i can show off; (b) I want stability for my family; (c) I want to be able to decorate like I want!

If you answered mostly a’s, then our experts recommend you take some time to get your finances in squeaky clean order before proceeding. Homeownership is a big financial responsibility, and with an unemployment rate over 9.0 across much of the country, it’s important that you have funds in place to take care of yourself and your family before you you buy.

If you answered mostly b’c, congratulations! You sound like a prime candidate for homeownership. Be sure to contact your local Realtor for advice on the next step.

If you answered mostly c’s, you are very close to being ready to buy. Take the next few months to check over your credit report and fix any errors. Talk to banks and lenders and see what rates you qualify for. Start putting buying at the forefront of your mind and your future planning. Make it a priority and it’ll happen!

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rPJ Wade, Yahoo Real Estate

Are you letting global uncertainty extinguish your real estate dreams without full consideration because money is an issue? Sometimes balancing livable compromises against researched options can help you achieve more than you may have believed possible.

Your future should not be entirely defined by what is affordable. When it comes to where you’ll live and how, concentrating on finances alone may short-change you in the long run.

One long-time reader is living proof that adapting your finances to achieve your dreams is a powerful alternative to designing your life around a lack of money.

When two people close to Tina Lowe (identity protected) died prematurely, Lowe promised herself she would not to spend her life sitting at a desk. She wanted to retire at 60 and start enjoying life.

“Friends and family couldn’t understand how I was doing it, but I did it anyway because that is what I wanted to do,” said Lowe, explaining how she achieved home ownership and early retirement without the million dollars that pundits say is essential to a successful future.

Lowe was almost 50 when her 30-year marriage ended, leaving her financially vulnerable. For a few years, Lowe held down two jobs to make ends meet. Eventually, a move to a small, less expensive apartment on the outskirts of town allowed her to quit the part-time weekend job.

Lowe invested time and effort in learning about money. She took advantage of her employer’s shared-contribution program and a loan from a friend to build up her Registered Retirement Savings Plan (RRSP). She also invested time in learning all she could about pensions, indexing, RRSPs, and, later, Tax-Free Savings Accounts (TFSA). From company seminars to reading anything she could find on the principles of investing, Lowe made sure she fully understood how money made money. By the time Lowe left work at 60, her RRSP fund totaled almost C$50,000.

Economic volatility did not shake Lowe’s determination to leave work on schedule. Meticulous planning and appreciation of the rewards of a simple lifestyle maintained her commitment. Creative back-up plans added security.

When Lowe noticed an advertisement for a condominium that could be carried for about what she was paying in rent, she revived the dream of home ownership that had been abandoned in favour of early retirement. Once again Lowes began researching diligently. She learned how condominiums work and what gave them sustainable value. When she discovered that prices increase with the number of amenities, square footage, and the higher in the building you are, she decided to buy at a smaller unit on a lower floor and in a less “lux” building. Lowe bought the location and neighborhood she loved and saved thousands of dollars. Lowe discovered a south-facing, self-contained fifth-floor, 344-square-foot unit with a balcony. Since the small building was free of fancy amenities, monthly maintenance fees remain affordable. The unit increased in value over her pre-construction purchase even before she moved in.

“It will be tight because it has been since day one, but I’m doing it,” said Lowe emphasizing that not smoking or owning a car stretches her income further. “It is important not to let anyone put you down or discourage you. When I first found this place, I had been to [a] real estate seminar and they got me going. Then I had one family member really put me down. Finally, a friend who is an accountant thought it was a good idea and encouraged me, and I thought, ‘I can do this.’ You must use knowledge to survive. It is very tight—I am not going to kid anyone, but I am still very happy I retired at 60.”

Knowledge is power. Take the time to understand which costs may become a challenge in the future. You may decide a part-time job will supplement investment or pension income. Consider housing like co-operatives where contributing skills and “sweat equity” may make the important affordable difference. Perhaps teaming up with friends or relatives will increase your buying power.

Continuing with income-generating projects will be increasingly commonplace, both out of interest and necessity.

Developers realize that they are creating new communities within the subdivision or high-rise they build. Some perceptive developers create work-live options that will provide services for residents while creating income streams for owners.

Churches, legions and other non-profit organizations have become community-builders in a “bricks and mortar” sense of the word by developing housing for their congregations, members and neighbors. Often this housing is below market value.

Communities involve varying numbers of people, but their strength lies in individual resilience, self-actualization and freedom. Property ownership is one outward symbol of these marks of individuality since no two properties – even condominiums, row houses etc. – are identical.

Over the past 20 years, the national home ownership rate has risen steadily. Although low interest rates, increasing disposable incomes, and stable employment conditions are credited with that improvement, the future still holds potential for growth. The wish for continued control over one’s home and life keeps increasing numbers of Canadians intent on investigating their all their options.

Waiting for great times to return is not a strategy, it’s a tragedy. Put your money to work for you in even the smallest ways. Think before you spend—“What else could I do with that money?—so you keep more of what you earn and continually move dreams closer to reality.

Remember, the impossible may take a little longer, but you can make it happen with perseverance. Today’s Local Market Conditions Report.

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Evan Nemeroff, National Mortgage News

A whistleblower lawsuit filed by two mortgage brokers has been unsealed in Federal District Court in Atlanta claiming that 13 banks and mortgage companies have cheated veterans out of hundreds of millions of dollars.

According to the lawsuit, lenders allegedly hid illegal fees in veterans’ home mortgage refinancing transactions related to the Interest Rate Reduction Refinancing Loans program. This program was created to allow veterans to take advantage of low interest rates and protect them from paying excessive fees and charges in the refinancing transaction.

The lawsuit claims that the lenders repeatedly violated the rules of the IRRRL program by charging veterans unallowable fees and then deliberately concealing this information from the VA to obtain taxpayer-backed guarantees for the loans. The lenders also allegedly falsely certified to the VA, in writing, that they were not charging unallowable fees.

In the lawsuit, the brokers are claiming that the lenders have been fraudulently reporting on HUD-1 statement forms undisclosed attorneys fees and other unallowable fees on the line for the actual cost of title examination and title search. The lawsuit says that lenders are reportedly charging $525 to $1,200 for title examination and title search fees, when the total cost should only amount to $125 to $200.

Lenders are permitted to charge veterans for recording fees and taxes, fees for a credit report and other “reasonable and customary amounts,” according to VA rules, but cannot charge attorneys’ fees or settlement closing fees in refinancing transactions involving VA loans.

“The false statements and fraudulent conduct are blatant,” said Marlan Wilbanks, co-lead counsel in this whistleblower case. “The banks simply reduced the charges for unallowable fees to zero, and then added those fees in the spaces where allowable fees were to be shown. Veterans don’t know what the usual and customary charges for those allowable fees are, and the VA understandably relied upon the banks to comply with VA regulations, rather than digging into every loan transaction. The banks took advantage of that reliance to cheat veterans and taxpayers.”

Since 2001, the VA has guaranteed over 1.1 million IRRRL loans. According to the Office of Inspector General for the Department of Veterans Affairs, the nationwide default rate for IRRRLs is 18% or more, with approximately more than 100,000 loans going into default every year. Nearly half of the VA loans that default result in foreclosure proceedings, costing the VA about $22,000 for each loan and also massive damages for American taxpayers and veterans.

Under the False Claims Act, the lenders would be liable for all damages resulting from those fraudulently induced guarantees of IRRRL loans, as well as penalties of up to $11,000 for each violation of the act.

The defendants in this case include Wells Fargo, Countrywide Home Loans, Bank of America, JPMorgan Chase, Mortgage Investors Corp., PNC Bank, First Tennessee Bank National Association, Irwin Mortgage Corp., SunTrust Mortgage, New Freedom Mortgage Corp., GMAC Mortgage and Citimortgage,

“This is a massive fraud on the American taxpayers and American veterans,” said James Butler Jr., co-lead counsel of the Atlanta law firm Butler, Wooten and Fryhofer. “Knowing they weren’t allowed to charge the fees, the banks and mortgage companies inflated allowable charges to hide these illegal without telling the veterans who were the borrowers or the VA they were doing so.”

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Jon Prior, Housing Wire

Roughly 150 protesters gathered at the Hyatt Regency in Chicago Monday afternoon, protesting the Mortgage Bankers Association as some of the the trade group’s members looked on and snapped photos.

Thousands more from various groups organized around the city, including Daley Plaza and Federal Plaza. A pastor from a nearby suburb who identified himself as Russell, arrived at the Hyatt and picked up a sign from the Southsiders Organized for Unity and Liberation. It was a cardboard cutout of JPMorgan Chase (JPM: 32.40+4.38%) CEO Jamie Dimon that read: "Wall Street Bank Robber."

The likenesses of Bank of America‘s (BAC: 6.54 +8.46%) Brian Moynihan, Countrywide‘s Angelo Mozilo and others were also seen bouncing above the chants and a marching band.

"Of my congregation of 270, about 30% are facing foreclosure," Russell said. "They come to me and my church, and we organize them and try to direct them to all the available programs and mediation sessions. But the banks continue to undermine that."

While Russell said SOUL and other community groups have been organizing protests since 2005, the recent uprising from Occupy Wall Street and other areas rejuvenated them to try and catch a more unified wave of dissent.

A SOUL organizer, who called himself Toby, made some final preparations for his speech through the megaphone. Even some curious MBA members gathered nearby on the hotel steps behind security to watch the crowd and listen to Toby.

"While we are out here desperately looking for jobs, they’re in there trying to figure out how to make more money off of us," he yelled into the megaphone.

One mortgage banker, who wouldn’t give her name, shook her head. "This is the wrong place to do this. We’re trying to figure out how to help them."

Others were more critical. Another banker pointed out to his colleague different union members he thought he saw in the crowd. Another scolded some protesters for bringing their children to the rally.

One technology vendor, who wouldn’t be identified, said he was sympathetic and that some previous members of this very trade group "got away scot-free."

"There’s just no jobs," he said. "What would you do?"

Another banker, who also wouldn’t give his name, said the recent wave of protests was even routine. Coming out of crises and recessions, there is always a wave of descent before the eventual recovery.

The MBA itself put out a statement Monday morning in advance of the protest, highlighting the 3,000 members who assembled in Chicago to revamp the U.S. housing system.

"We all recognize that our industry faces a trust deficit with policymakers and the public and that people in our industry contributed to the events that led to the financial crisis," the MBA said. "The mortgage professionals who have gathered in Chicago this week are about sustainable homeownership and ensuring access to affordable mortgage credit for qualified borrowers."

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Kari Huus, msnbc

California woman’s case may show how movement can use its muscle against banks.

LA PUENTE, Calif. — Rose Gudiel and her family were squatters in their own home. They had lost a two-year battle against foreclosure, and the eviction date had arrived. They hunkered down in the house on Sept. 28, surrounded by dozens of homeowner advocates and friends, hoping to stave off forcible removal.

“(The bank) kept saying we can’t do anything. Your case is closed,” said Gudiel. “Our stand was, ‘No, we’re not leaving. This is our home. We worked hard for it and we’re just not going to leave.’”

But instead of the anticipated confrontation, there was a dramatic reversal of fortune. Fanny Mae canceled the eviction notice and offered the Gudiels a loan modification that could enable them keep their home.

Why? Fannie Mae and loan servicer OneWest won’t discuss the case. But nonprofit advocates say a series of bold protests — with reinforcements from the “Occupy Wall Street” movement — and a spate of media interest put Rose in the limelight and forced the banks to back down.

It was a small victory — and Gudiel still has to finalize her deal with the bank — but one that Southern California housing activists hope to repeat. It also provides an example of how the sprawling "Occupy" movement — often criticized for its lack of focus — can lend muscle to specific goals pursued by organizations and individuals.

Gudiel’s version of the foreclosure on the 1,200-square-foot home she has shared with her parents and a brother in this working-class suburb of Los Angeles since 2005 is starkly at odds with the limited information provided by the banks.

According to Gudiel, when she tried to make the $2,500-a-month mortgage payment two weeks late in November 2009, OneWest refused the payment and instructed her to pursue a loan modification, a long process that ultimately ended in rejection in January.

Gudiel said she fell behind when the family suffered a tragedy and two financial setbacks: Her brother, Michael, was killed in a drive-by shooting, meaning he was no longer contributing to the mortgage payment. At the same time, Gudiel was temporarily earning less in her job with the California Economic Development Department after being furloughed because of the state budget crisis.

Shortly thereafter, Rose Gudiel’s income returned to normal, and a second brother moved in to help with the mortgage.

Gudiel continued to work through the loan modification process but encountered obstacles at every turn, said Peter Kuhns, director of the Los Angeles branch of Association of Californians for Community Empowerment, a nonprofit that has been working on her case.

“Month after month, she supplied documentation to the bank for the modification,” he said. “At the same time, each month she saved the money she would have used to make the house payments so that she could make back payments (so) at any point OneWest could accept her money.”

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Level Architects: House with Slide[s]

via Design Boom


‘house with slide’ by level architects | all images courtesy level architects

Yokohoma-based atelier level architects has completed ‘house with slide’, a three-story family residence that features a continuous circulation route that utilizes both stairs and the playground equipment. Circumscribing the volume of the house, the playful layout places the living spaces at the core of the house with a number of access points along the course.


living area on the second level

Since the circulation is placed at the outer edge of the design, the interior is largely lit using
vertical openings in the roof. a centrally-placed courtyard with sliding glass doors illuminate
the living room with natural daylight while creating a small play area for the children of the house.
rounded corners of the layout encourages the light to wash around edges to further light the space.


slide exit into the living space


(left) stairs up to the top of the slide

(right) slide

third floor hall way connecting the stairs and slide


living room with light courtyard


(left) light courtyard

(right) washroom with roof light

entrance and slide exit to the right


(left) library

(right) slide and hallway

exterior


circulation diagram

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David Lachapelle, Design Boom

Natural Architecture

The natural environment still manages to fill us with a sense
of awe and amazement. despite the amount of scientific
knowledge mankind has gathered, nature still holds great
mysteries that we may never be able to unravel.
this complexity has continually daunted man. in frustration, we
try to control nature by enforcing order. as a result,
we have distanced ourselves from the earth, even though
our survival is completely dependent on it. we are now trying
to regain our close connection to nature.

There is an emerging art movement that is exploring mankind’s
desire to reconnect to the earth, through the built environment.
referred to as ‘natural architecture’, it aims to create a new,
more harmonious, relationship between man and nature by
exploring what it means to design with nature in mind.

The roots of this movement can be found in earlier artistic
shifts like the ‘land art’ movement of the late nineteen sixties.
although this movement was focused on protesting the
austerity of the gallery and the commercialization of art,
it managed to expand the formal link between art and nature.
this has helped develop a new appreciation of nature in all
forms of art and design.

The ‘natural architecture’ movement aims to expand on ‘land art’
by acting as a form of activism rather than protest. this new
form of art aims to capture the harmonious connection we
seek with nature by merging humanity and nature through
architecture. the core concept of the movement is that
mankind can live harmoniously with nature, using it for our
needs while respecting its importance.

The movement is characterized by the work of a number of
artists, designers and architects that express these principles
in their work. the pieces are simple, humble and built using the
most basic materials and skills. because of this, the results
often resemble indigenous architecture, reflecting the desire
to return to a less technological world. the forms are stripped
down to their essence, expressing the natural beauty inherent
in the materials and location. the movement has many forms of
expression that range from location-based interventions to
structures built from living materials. however all of the works
in the movement share a central ethos that demonstrates a
respect and appreciation for nature.

These works are meant to comment on architecture and provide
a new framework to approach buildings and structures.
they aim to infuse new ideas into architecture by subverting
the idea that architecture should shelter nature. instead,
the structures deliberately expose the natural materials used
in the building process. we see the branches, the rocks and
all the materials for what they are. we understand that these
structures won’t exist forever. the materials will evolve over
time, slowly decomposing until no evidence remains.
these features are intentional, provoking viewers to question
the conventions of architecture. the designers aren’t suggesting
that architecture must conform to their vision, they are just
providing ideas that they hope will inspire us all to rethink the
relationship between nature and the built environment.


‘la tonnelle’ by gilles bruni and marc babarit, 1996


‘ash dome’ by david nash, 1977


‘organic highway’ by mikael hansen 1995


‘bridge in moasi, china’ by edward ng, 2005


‘clemson clay nest’ by nils-udo, 2005


‘weidendom’ by sanfte strukturen, 2001


‘reed chamber’ by chris drury, 2002


‘running in circles’ willow and maple saplings, patrick dougherty, 1996


‘toad hall’ by patrick dougherty, 2004


‘fog pad’ by n architects, 2004


cover of ‘natural architecture’ by alessandro rocca, published by princeton architectural
press, 2007 – all the images featured in this article are taken it.

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