Federal Reserve on Richmond (area) residential real estate

The Federal Reserve “Beige Book” is a summary of qualitative data, i.e., interviews, from each of the twelve districts regarding economic conditions. Below is the most recent Beige Book data for the Richmond District (Maryland, Washington DC, West Virginia, Virginia, North Carolina, and South Carolina), dated October 2009:

“Fifth District residential real estate agents generally reported stronger traffic and actual sales of houses priced in the low-to-middle range of their markets, citing first-time homebuyers and the government’s tax credit program as the driving force. Several agents reported strong sales in September, based on not only gross sales revenue but also unit sales. One agent expected October to be equally as busy, based on the number of visitors at his open houses. Another agent reported that sales were “up a tad,” and that the number of properties that went under contract increased in recent months. In contrast, Realtors in North Carolina reported slow housing markets, due partly to people taking their time to look and others being cautious because of their credit status. Indeed, one agent told us that, “pristine credit is practically required to get financing.” Most Realtors reported that the low- to middle-priced houses were their best sellers, and the higher-end properties showed very slow sales in many areas.”

Economic Doom And Gloom Versus The Value Of Your Home

By Cameron C. Martel

Something strange happened, and if you were born before the mid-1980s you likely know all-to-well what it was: a recession.

This recession has been so widely hyped up for many reasons, the least of which include the folding of several major American banks and the bankruptcy of an entire country (you did what you could, Iceland).  However, more than anything, this recession has been so widely pumped-up simply because it was the first major recession that an entire generation of people had ever experienced.  For those born in the 1980s and beyond, a recession was something they had never had the pleasure of experiencing.  Until now, that is.

Not only that, but the Internet and the world’s ability to send and receive information in a tenth of a second makes it easier than ever before to transmit news.  Of course, doom and gloom sells nearly as good as sex, and that’s what’s been all over TV and the Internet.

Economic Recession Myths: You Can Still Buy a Home, Dummy!

One thing that seems to be circulated more than anything is the myth that the recession, with all of its economic hardship and financial disparity, has made it impossible for your average Joe to purchase a home or obtain a mortgage.  To be blunt: if you believe that, you are wrong.

In fact, now is the time for a qualified buyer to snatch up great deals!  The only people who are going to be taken for a ride when purchasing a home are the people who aren’t qualified to do so (hey, isn’t that how we got into this mess in the first place?).  Are you a qualified buyer?  If you meet the following criteria, then you may very well be:

1. You have a down payment – You don’t need to have 25% of the purchase value as a down payment, but having as little as 5% can take you from under-qualified to prime lending material.  Do you due diligence and spend some time saving money before you start shopping.
2. You have decent credit – This one isn’t as important as you think.  Yes, good credit is still an obvious requirement for purchasing a home, but you can also play with this value a little.  Paying down your current debt is always a great way to improve your credit, but don’t discount the value that your down payment can play.  Someone with a FICO score of 650 (the North American average) may not obtain a mortgage with a 5% down payment on a $450,000 home, but they may be able to obtain that same mortgage with a 15% down payment- or if they assume the mortgage of the current homeowner.  Food for thought.
3. You maintain a consistent lifestyle – No lender is going to give you money if you are very ad-hoc with your spending and credit.  If a lender runs your credit bureau (which they will) and sees that you’ve tried to obtain a mortgage as well as $75,000 worth of other credit they are likely going to see you as a greater risk than if you had no other credit applications in the last year or two.

You Don’t Need Great Cards to Build a Great House

The people living under a house of cards are the people that won’t be obtaining mortgages.  All this talk of a “new economy” is really just the lending market going back to basics: people with good credit, savings, and a down payment are the people who are going to enjoy prime mortgage rates and lending opportunities.

Be smart, clean up your credit, and save some money for a while.  Sure, it may mean living in your apartment for another couple of years, but it could be the difference between a mortgage at a competitive interest rate and no mortgage at all.

Do you think the recession has axed your chances at obtaining a mortgage? Think again. Buying your dream-home is still a very real possibility, despite the recession.

Henrico Proposes Tax Relief For Owners Of Lower Value Homes

By Katherine Calos

Richmond Times-Dispatch

Published: October 25, 2009

Older and lower-value homes in Henrico County may qualify for a tax break on major renovations next year, if supervisors follow through on a proposal from a recent work session.

To qualify, homes must be at least 40 years old and assessed at no more than $200,000. Renovations or additions must increase the value of the house by at least 20 percent but not increase the size of the house more than 100 percent.

Owners would be exempt from any increases in real estate taxes because of the improvements for seven years.

“The perception of Henrico County is that it’s a very rich county and it has all these houses valued at $750,000 or greater,” said County Manager Virgil R. Hazelett, “and yet 26 percent of total housing stock in Henrico County is valued at $200,000 or less.”

The partial tax exemption would be “a way to attract builders and others to make improvements in our older neighborhoods,” he said.

Areas that could benefit include Beverly Hills, where the average assessment is $184,500 and the average house was built 54 years ago; Regency Park/Farmington, $184,200 and 49 years; Ridgehaven, $169,800 and 52 years; Lakeside, $167,100 and 57 years; Sandston/Seven Pines, $149,200 and 52 years; and Laburnum Avenue West, $86,400 and 63 years.

The 20 percent increase in value applies to the structure only, not the land beneath it. If a property is assessed at $200,000 and the house has a value of $150,000, the minimum house improvement to qualify for the tax exemption would be $30,000.

The measure will be introduced at Tuesday’s Board of Supervisors meeting and have a public hearing at the Nov. 24 meeting. If adopted, it would become effective Jan. 1.

City Apartment Complex Sells For $9.5 Million

Kensington Court Apartments in the city’s Museum District sold last week for $9.5 million. The sales price was confirmed by the city records office.

PMC Property Group of Philadelphia purchased the 120-unit apartment building at 2900 Kensington Ave. from a group of investors including Robin Miller, principal of Miller & Associates, who developed the property in 1999.

This is PMC’s only property listed in Virginia; the firm also has apartments in Connecticut, Florida, Maryland, Massachusetts, Pennsylvania and South Carolina.

Neither party could be reached for comment.

The property was purchased for just $500,000 more than its assessed price of $9 million. It had previously been listed for sale on LoopNet.com for $11 million.

Miller bought the building in a foreclosure auction for $1.22 million in 1998. The previous occupants operated an adult-care home that lost its license.

WM Jordan construction completed a $5.28 million restoration of the property shortly after it was purchased by Miller.

The building was constructed in 1924 and was the original home of Johnston-Willis Hospital, which later moved to Chesterfield County.

Using Sustainable Materials For Renovations

By Roby P. Pagong

Before we can fully understand the use and importance of sustainable materials in renovations, we have to learn what it is first and why is there such big fuzz about its use.

What are sustainable materials?

These are green materials. A perfect example of sustainable material is the bamboo. This means that once you use them, they will be able to replenish or generate their kind. Thus, it will not compromise the environment. However, you should not leave the replenishing to the materials alone. You have to take part in its development by ensuring that as they regenerate themselves, they have the necessary nutrients to grow strong and healthy.

Why use sustainable materials?

A lot of groups have been encouraging the use of these materials. You might ask why? So what if the materials you use are unable to replenish themselves, at least you get the chance to use them, right? Wrong! If everyone thinks this way, just think of how the world will look ten years from now? We are slowly experiencing the wrath of nature because most of us failed to take care of it. If we do not do our share today, the results in the future could be catastrophic.

You can contribute in saving our environment by using sustainable materials whenever you can. Using such materials during renovations is a big help. Just think of how many people renovate their homes. There are few aspects of sustainable you can consider to ensure that you are environmentally responsible. Some of them are identified below.

If you are to renovate your home, use locally developed sustainable materials. It has to be found in your localities to reduce the travel time, expenses and energy. Keep in mind that transporting materials will still create problems in the environment. Automobiles use gas and it emits toxic substances that harm the environment.

You also have to keep important points in mind when choosing materials for the renovation. As much as possible, it should create minimal damage to the environment. They should not only be renewable, they have to be non-toxic as well. Most importantly, they have to be recyclable. Bear in mind that the renovations you make will not last forever. Other changes will be made in the future. The materials you will use should not add more waste. Instead, other people should find different means to use it.

If you are having a difficult time figuring out what to use, consult Green Architects. You will be surprised with the number of choices they have available for you. They can even look around your property and find materials that you can use for the renovation. They can also help you find a supplier. Finding the right supplier is essential to ensure that you get the materials you want. You have to let them know what you need. Most suppliers are not used to sustainable materials. This is why homeowners should help in raising awareness.

All of us have to be environmentally responsible. Our choices will help make that happen. The use of sustainable materials will help restore our natural resources.

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