If you have ever used an old fashioned hand water pump, then you remember how much work it can take to get the water flowing. Sometimes you might crank up and down on that old cast iron arm for several minutes and not even get the first drop of water. When one of these pumps had not been recently used, you would "prime the pump" by filling it with water to get it going.

The hand water pump has been around for a long time and is very reliable once the water is flowing. Much more effort is required to get it started than keep it going, and I think it makes for a great comparison to how we should view the real housing market problem.

Most people understand that the real estate market has lost its prime, and many speculate on what it is going to take to get the housing market restarted. The real estate equivalent to pouring water down the spout of the hand water pump is a topic that is often discussed in real estate circles, seeking a solution to the real housing market problem.

The Real Housing Market Problem

Like most problems that you deal with in life, there is no one single cause for the housing market collapse, nor will there be one singular action that restores it to historical norms. But 2011 has unveiled the primary problem in the housing market, and I do not see it being addressed in many real estate forums, and certainly not from NAR or our "leaders" in Washington.

Historically, more than one-half of all homebuyers already own a home, and that means as a prerequisite to buying a home, they first have to sell a home. So, assuming this number is only 50%, we can say that 1/2 of the buyer pool has to sell a home before they buy, and 1/2 is either a first time homebuyer, an investor, or somebody who has sold a home already.

Thus, the real housing market problem is that 50% of the people who would be buying homes right now have a problem, and they do not know how to solve it. They are what is broken in the real estate pump, and they are the ones that need to be "primed."

Let's take a look at the reality being faced by 1/2 of the buyer pool.

• The typical home ownership period is 5 to 7 years
• The housing market peaked 6 years ago
• The majority of those "ready to move" purchased or refinanced in the past 5-10 years.
• Home values have declined over 30% since 2006
• The majority of the "ready to move" market have zero or negative equity in their homes to bring to the next purchase
• Negative equity owners are trapped because all of their options lead to "no new home purchase"
• If they bring money to closing, they have no equity to put in the next home
• If they do a short sale (and stay current on their mortgage), they get dinged on credit and have to wait 2 years to buy
• If they do a short sale (and do not stay current on their mortgage), they get destroyed on credit and won't be buying for quite some time
• These would-be buyers don't have viable options, so they are doing nothing ... they need to be "primed"

Therefore, the real housing market problem has nothing to do with "tightened lending standards," or "low appraisals" as has been sung by the National Association Of Realtors. The real problem we must fix is the mass of pent-up buyers who cannot first sell their homes.

As these homebuyers languish awaiting buyers for their homes at prices that will not be found in this market, home values continue to decline, thus adding more people to this group of frustrated homeowners.

A Solution To The Real Housing Market Problem

One potential solution to the real housing market problem is a Short Sale Amnesty Program. I would propose a simple solution, one that removes the 2-year wait for purchasing a home for people doing a short sale, combined with a public awareness program of how current short sale actions can be implemented. I would drop the credit ding (currently about 50 pts) for those who have maintained their payments on time, but I would continue the severe response for those that fall behind on their payments.

The solution does not need to reward people who made mistakes in the past, rather it needs to free those who have only been harmed by falling prices. Lenders (or more importantly, the shareholders of these large banks) need to push the leadership of their organizations to work feverishly to approve short sales. The values have already been lost, I suspect some banks are responding slowly in order to retain the decision makers who do not want to book the losses (even though they have already occurred).

While I know that a singular solution is not the answer, and I would certainly spend more time than an hour in the morning to write the solution, a short sale amnesty program would invigorate the market much faster than all the "stimulus" mistakes that have already occurred.

Simply put, there are people who cannot sell their homes because the people who want to buy them cannot sell their homes because the people who want to buy them cannot sell their homes ... ad infinitum. This is a continuous loop that needs to be severed. The pump needs to be primed!

There are millions of people who would like to move, they just do not know how to get out of their current homes without losing their right to home ownership. A short sale amnesty program would put these millions back into the buyer pool and help solve the real housing market problem.

Grading is essential to a house and home inspector reports often say something like, "Negative drainage conditions."

What is a "negative drainage condition?" 

ANY GRADING THAT DOES NOT ENCOURAGE WATER AWAY FROM THE HOUSE STRUCTURE.

Here is what I say on EVERY report, whether the grading needs attention or not:

"Grading/drainage:  be sure that any surface water or downspout discharge drains easily and well away from the house – a good rule of thumb for soil grading is a slope of 6” in the first 4’ of run away from the house, and 1” of slope for every 4’ of run away from the house thereafter."

Why do I say that on EVERY report?  SO THE CLIENT SEES IT!  I think the report should be educational as well as informational.  And that is GOOD information in anyone's book!

But why?

Certainly this kind of cracking is due to settlement.  The crack is evident on the left just under the vent, and it continues for many feet to the left.  The crack on the right begins at the corner and it continues for many feet to the left.

These are both on the same side of the house.  The house is 45 years old, and has a concrete masonry unit (concrete block) foundation.

I also noticed that the two downspouts on that side of the house had been recently extended to divert gutter water further from the house.  Also, there was soil banked recently against the house.  How did I know this is fresh soil?  Because it was very dark, like out of a bag from the garden center, and a different color from the soil 6' from the house.  IT WAS ADDED RECENTLY.

The key word in both those clues is RECENTLY.  Obviously these sellers had gotten some solid advice from someone about water diversion and "negative drainage conditions."

But the damage had been done.  Years of "negative drainage conditions" had created a foundation problem, about which nothing was done.

My recommendation:  there is a cause and effect when cracking like what is seen above is present on a house.  Sometimes it is obvious and sometimes it requires professional evaluation.  But grading and drainage are so essential to a house, they should always be the belle of the ball when looking at properties.  WATER IS THE KILLER OF HOUSES.  Be sure that water is diverted AWAY from the house.  Be sure...

 

Jay Markanich Real Estate Inspections, LLC

Based in Bristow, serving all of Northern Virginia

www.jaymarinspect.com

It's time for a post about retaining wall installation - best practice.  Retaining walls are something that home inspectors see frequently.  And just as frequently those walls have problems.

A recent post prompted many to think what is necessary to the proper installation of a retaining wall.  This is a very good question, and one deserving a response.

Retaining walls can be constructed of many things - metal, wood, brick and block, man-made blocks, and huge boulders and stone.  The idea is to retain the weight of the soil behind the wall, and divert water, and its pressure, away from a structure or pathway.

An engineer I have known and referred for many years is Ken Fraine, of Soil and Structure Consulting, Inc.  When asking him his thoughts regarding this post, he said,

"Nearly every failed retaining wall I’ve ever inspected failed due to an improper drainage system or a complete lack of one.  Note that [concrete] block walls should also have a waterproofing membrane placed on the backside to prevent deterioration of the mortar joints and the blocks themselves."

Drainage, therefore, is significant.  The the single-most reason walls will eventually fail.

Properly constructed, retaining walls are very complex.  Many things work together to insure their success, from retaining wall material, back fill, angle of the wall setback, stabilization into the rear structure and drainage, etc..

I have seen retaining walls made from the man-made blocks that are 30' high and more.  Of course, with that height, more drainage is necessary than the single collection pipe shown here.  Those blocks intersect, or have lips which rest on each other such than one cannot be moved as regards its neighboring blocks.

The collection pipe would be a 4" plastic tube with pre-drilled holes to collect and then divert water.  Of course it would be wrapped with a silt-filtering mesh and then protected with gravel (called Unit Core Fill/Drainage above).

Even with different wall materials, the components shown above would still apply.  And any wall constructed like the one in the diagram above would be

Best Practice

My recommendation:  just from a visual inspection or walk around, it might be difficult to determine if a retaining wall has all the components and structural capability of the diagram above.  But you can ask!  Find out who did the work, try to obtain any permits and receipts and investigate the company that put the wall in.  Doing all that will go a long way toward the peace of mind needed to know if a wall will last.

Jay Markanich Real Estate Inspections, LLC

Based in Bristow, serving all of Northern Virginia

www.jaymarinspect.com

First Time Home Buyer Tip #1: Find A Good Buyers Agent

Find a Portland Realtor® who has experience helping first time buyers in Portland -- preferably a Buyers Agent. Better still try to hire an Exclusive Buyers Agent. Exclusive Buyers Agents work ONLY with Home Buyers, never sellers!

Find an Portland agent who is simpatico, someone who is not going to cause unnecessary drama. First time home buyers are not only making a financial commitment, but also an emotional one. It’s critical, especially if you're buying a home for the first time, that your Realtor® is both skilled and experienced with first time home buyers.

The U.S. Dept. of Housing and Urban Development “Shopping for Your Home” has a section (found on Page 6) which talks about the BUYERS’ RESPONSIBILITYin shopping for a house:

“Role of the Real Estate Agent or Broker Frequently, the first person you consult about buying a home is a real estate agent or broker. Although these agents and brokers provide helpful advice, they may legally be representing the interests of the seller and not yours. . .

It is your responsibility to search for an agent who will represent your interests in the real estate transaction. If you want someone to represent only your interests, consider hiring an “EXCLUSIVE BUYER’S AGENT”, who will be working for you.

First Time Home Buyer Tip #2: Now is the Time to Buy a Home

Always remember: There’s no “right” time for first time buyers in Portland to buy a home, any more than there’s a "right" time to sell. If you find a home now, don’t try to second-guess the interest rates or the housing market by waiting. Changes in the housing market don’t usually occur fast enough to make that much difference in price and a good home won’t stay on the market long. As your Buyer's Agent I know the current market and can keep my finger on the pulse for you.

Please see my recent post: What First Time Buyers Need to Know

First Time Home Buyer Tip #3: Don’t Ask For Too Many Opinions.

Hard as this may be to hear . . . your parents, or your sister's brother-in-law's uncle probably aren't licensed Realtors®. And although itt’s natural for first time buyers to want reassurance for such a big decision, too many opinions and outside static will make it much harder for you to make your decision. I've sold homes since 1999 and have closed 100's of transactions, well over. I will be able, and happy to, answer your questions and address all your concerns.

First Time Home Buyer Tip #4: Accept That no House is Perfect

Focus on things that are most important to you and let the minor ones go. As a first time home buyer in the Metro Portland market, chances are you will have a price point: a price that you will feel comfortable with in making a purchase.

The price point for many first time buyers may be modest and conservative and homes will reflect this.  Think long-term and think about projects you can do yourself.

 

First Time Home Buyer Tip #5: Don’t Try to be a Killer Negotiator

Negotiation is definitely a part of the real estate process, but trying to “win” by getting an extra-low price, or too many seller concessions may alienate the seller. Ask me about my horror stories . . . when first time buyers"negotiated" too much a killed their own deal, losing out on the house they really wanted to buy. If you try to be a "killer negotiator" you may just end up killing your deal. Again . . . ask me about my horror stories!

First Time Home Buyer Tip #6: Remember Your Home Doesn't Exist in a Vacuum

Don’t get so caught up in the physical aspects of the house itself—room size, kitchen—that you forget such issues as amenities, noise level, etc., that impact the livability of your new home. While they say "Location, location, location," there are also other aspects of your home aside from location that first time home buyers should pay close attention to. Commutes are a rather important consideration.

First Time Home Buyer Tip #7: Don’t Wait Until You've Found a Home to Get Approved for a Mortgage

Presenting an offer contingent on a lot of unresolved issues will make your bid much less attractive to the sellers. There are many good programs available for the first time buyer, the Oregon Bond Program being one. It's best to find out what you qualify for when buying your first home.

First Time Home Buyer Tip #8: Factor in Maintenance and Repair Costs.

If you're using me as your first time buyers agent, I will most likely do a splendid job of getting the repairs addressed during the repair contingency of your home purchase contract. But, when the home is yours, YES you will have some post-home buying budget concerns. Again #4 above, and you will want to add your personal touches. This is especially important to first time home buyers. Even if you buy a new home, there will be some costs. Don’t leave yourself short and let your home deteriorate. I can help determine deferred maintenance costs.

First Time Home Buyer Tip #9: Accept That a Little Buyer’s Remorse is Inevitable

First time buyers will always have a few "Are we doing the right thing?" thoughts. This is natural and will probably pass very quickly. When you buy a home you should have the "We ARE doing the right thing!" thoughts . . . otherwise, don't buy a house! Again, especially true if you're a first time buyer. Buying a home, especially for the first time, is a big commitment, but it also yields big benefits. I bought my first home I was 19 . . . many, many moons ago. Please talk to me personally about your trepidations.

First Time Home Buyer Tip #10: Choose a Home Because You Love It and It Meets The Majority of Your  "Wants" and "Needs"

THEN, and only then, think about appreciation. While U.S. homes can appreciate nicely if purchased correctly (not buying over your budget, not buying in a hot seller's market, etc.) your home’s most important role is as a comfortable, safe place to live and call home! Unless you're an "investor" your home should be just that! But if you're a first time home buyer, your home should be where you love to live.

Follow These First Time Buyer tips and I'll soon be saying . . .

EBA Portland ~~ 100% BUYER REPRESENTATION ~~ 100% of the Time

EBA Portland, LLC is an Exclusive Buyer Agency serving the Metro Portland real estate market since 1999. If you’re a Buyer in the Metro Portland area (including: Beaverton, Tigard, Hillsboro, Lake Oswego, Downtown Portland,) and contemplating a purchase, talk with a Buyer’s Agent . . . better yet, talk to an Exclusive Buyers Agent. Exclusive Buyers Agents do not work for listing brokerages or Sellers. An EBA’s fiduciary duty is: 100% BUYER REPRESENTATION . . . 100% of the Time.

Carla Muss-Jacobs 503-810-7192 Carla@carlahomes.com

BuyersAgentPortland.com

All rights reserved ©

We all have heard it – kitchen and bathrooms sell houses! This is widely known, but yet we have received often comments from home sellers such as:

 

• The kitchen is so outdated that we would have to put a completely new kitchen in. We’d rather have the home buyer do that and do it to their taste.
• Updating my kitchen is way too expensive. It is not worth doing it.
• This is too much work, I don’t want to do it anymore, now that I am moving out.

 

Here is an example of such a kitchen (before):

 

 

What would a home buyer think when seeing a house with an outdated kitchen?

 

• This is not livable for me. I will have to immediately update this kitchen before I even move in here.
• This will cost me $30,000 to $45,000 that I have to immediately spend right after I just made my single most expenditure.
• How long will it take me to get this fixed. I am not sure I can live in here for that long without having a kitchen. I have kids to feed and to prepare family dinners right away when moving in. Where will I be able to do that when the kitchen is under construction? What is the food take out cost in addition to the renovation cost?
• This is too much hassle for me. I ‘d rather look for a house with a decent kitchen.
• If this kitchen is already not well maintained, I assume the rest of the house also has not been updated as well. This house will be a money pit. Let me see the next listing in this market area.

 

With 92% of home buyers looking online first to decide which properties to visit, it will be hard to get buyers to even come to visit your house if the kitchen does not look updated.

 

So, should you bother sprucing up your kitchen when selling your house?

 

The answer is absolutely! In most cases, if your cabinet bones are in decent shape, there are many ways to give your kitchen an updated look without breaking the bank and going through the hassle and expense of installing a completely new kitchen. The goal with updating and staging an outdated kitchen is to show buyers that they can comfortably move into the house without having to immediately replace the kitchen. We want to show buyers that they can move in and live here for quite some time until they have the money to invest into a new kitchen.

 

Don’t forget that typically the house is a home buyer’s single largest purchase in their lives – it takes them a while to financially recover to be able to invest in major projects such as kitchen updates.

 

Houses with nice kitchen and updated appliances sell faster and for a higher price. Knowing where to invest in for getting the highest return on investment in a kitchen update is key to the success when preparing a home for sale to sell fast and at the top dollar.

 

Birgit Anich Staging & Interiors has prepared many kitchen in Fairfield county Connecticut for sale to stand out from the competition and to sell faster. Here are some examples of our before and after kitchen photos:

 

 

 

 

About the Author: Birgit Anich is the President and Creative Director of Birgit Anich Staging & Interiors one of the most innovative real estate staging and design firms in Fairfield County, CT. Our distinctive approach is creating a lifestyle experience that sells homes fast and at the maximum price. Birgit’s focus is working with home sellers and their real estate agents to prepare their property to appeal to the most likely buyers. As Certified Advanced Stagers, trained by HGTV star Matthew Finlason, Birgit Anich Staging and Interiors transforms a property into a buyer’s dream using Targeted Lifestyle Marketing Techniques.

Birgit also won the most prestegious awards in the Staging Industry - Regional and National Awards of Rookie Stager of the Year by RESA.

Copyright © 2011 Birgit Anich Staging & Interiors, LLC – All Rights Reserved

 

Fairfield County, Connecticut   I    www.BirgitAnich.com   

 

I post a new home inspection photo on the Structure Tech Facebook page six days a week, and this year I decided to put together a blog post showing my favorite photos from 2011.   I hope you enjoy these half as much as I do.  As with all of my blog posts, click on any of these photos for a larger version.

Ice Dams - Remember ice dams?  They were nasty last winter.  I'm enjoying winter in Minnesota much more this year; what have we received so far, two inches of snow?

Ice Dam-age Control - This is the only photo we didn't take (thanks DKW3).  This was someone's solution to chronic water intrusion from ice dam leakage.

Hack Ice Dam Removal - We've said many times that pressure washers should never be used to remove ice dams, because they tear up shingles.

Hot Roof?  Cold Roof?  Not Sure.  - Attics are supposed to be treated as warm spaces or cold spaces.  Someone obviously didn't understand the point.

Hockey Puck Fascia Repair - Hole in your fascia?  No problem!  Just use a bunch of caulk and a hockey puck to fix it.

Rotted Roof Decking - The roof decking was in horrible condition at this house, but that didn't stop the roofers; they installed a new roof covering right over the top.  That black stuff is the ice & water shield.

Bad Shingle Repair - No explanation needed.

Bad Chimney Crown - We could tell this chimney crown needed repair just by looking at it from the ground, but we had no idea it would be this bad.  This chimney crown obviously needs to be completely replaced.

Chimney with Facade Falling Apart - Three sides of this chimney looked just fine from a distance.

One Angry Bird Away... - As I was typing up the insection report for this house, my wife saw this photo on the computer screen and said "Wow, that chimney looks like it's about one angry bird away from collapse."  Good call.

Downspout Combustion Air Intake - That downspout connecting to the return air duct fed to the exterior of the home and was being used as the combustion air intake.  It's not conventional and it's probably a little small, but hey, it works.

Central Air-ish - This was someone's attempt at cooling a room where the AC unit wasn't installed.

Creative Heat Register - Interesting solution.

Heat Register in Cabinet - While most people would have had to decide between a heat register and a cabinet here, this homeowner decided to have their cake and eat it too.  Can you guess what city this house was in?  

Hint: Look up "cake-eater" at urbandictionary.com.  

Garbage Can Sump Basket - Sump baskets are reinforced on the sides to prevent them from collapsing.  Plastic refuse containers are not.

Mouse in Panel - Any unused openings in electric panels are supposed to be covered over, not only to contain any potential fire or sparking that could occur inside the panel, but also to prevent unwanted visitors from coming in.

Covered Outlet - No explanation needed.

Missing Fuses - Apparently someone was tired of replacing those pesky fuses, so they replaced the fuses with a couple short lengths of copper tubing.  Can you say fire hazard?

Mirror Tile on Kitchen Floor - This might be the most interesting tiled floor we've come across.

Useless Shower Fan - Someone went to a lot of effort to install this bath fan above the shower, but without a duct... what's the point?  I can only scratch my head.

Water Behind Escutcheon - My personal favorite.  I noticed water leaking out from behind the escutcheon, which is that decorative metal trim ring around the pipe sticking out of wall.  I turned the water off, pulled the escutcheon away, got my camera ready, turned the water back on... click.

Ok, that was twenty-one photos.  Close enough.  If you enjoy these kinds of photos, please click "Like" on our Facebook page.  Thanks!

Reuben Saltzman, Structure Tech Home Inspections - Email - Minneapolis Home Inspector