Cindy's Blog

FOR IMMEDIATE RELEASE

March 2, 2010

FACT SHEET: HOMESTAR ENERGY EFFICIENCY RETROFIT PROGRAM

WASHINGTON--In his State of the Union address, the President called on Congress to pass a program of incentives for homeowners who make energy efficiency investments in their homes. Today, while touring a training facility at Savannah Technical College, the President outlined more details of a new "HOMESTAR" program that would help create jobs by encouraging American families to invest in energy saving home improvements. Consistent with the President's call for a HOMESTAR program, the Senate Democratic leadership included a proposal of this kind as part of their Jobs Agenda released on February 4, 2010. The President looks forward to continuing to work with Members of Congress, business, environmental and labor leaders to enact a HOMESTAR program into law.

Background on the HOMESTAR program

With unemployment in the construction sector near 25% and with substantial underutilized capacity in our manufacturing sector, the HOMESTAR program has the potential to jumpstart our economic recovery by boosting demand for energy efficiency products and installation services. For middle-class families, this program will help them save hundreds of dollars a year in energy costs while improving the comfort and value of their most important investment - their homes. In addition, the program would help reduce our economy's dependence on oil and support the development of an energy efficiency services sector in our economy. Key components of the HOMESTAR Program include:

• Rebates delivered directly to consumers: Like the Cash for Clunkers program, consumers would be eligible for direct HOMESTAR rebates at the point of sale for a variety of energy-saving investments in their homes. A broad array of vendors, from small independent building material dealers, large national home improvement chains, energy efficiency installation professionals and utility energy efficiency programs (including rural utilities) would market the rebates, provide them directly to consumers and then be reimbursed by the federal government.
• $1,000 - $1,500 Silver Star Rebates: Consumers looking to have simple upgrades performed in their homes would be eligible for 50% rebates up to $1,000 - $1,500 for doing any of a straightforward set of upgrades, including: insulation, duct sealing, water heaters, HVAC units, windows, roofing and doors. Under Silver Star, consumers can chose a combination of upgrades for rebates up to a maximum of $3,000 per home. Rebates would be limited to the most energy efficient categories of upgrades-focusing on products made primarily in the United States and installed by certified contractors.
• $3000 Gold Star Rebates: Consumers interested in more comprehensive energy retrofits would be eligible for a $3,000 rebate for a whole home energy audit and subsequent retrofit tailored to achieve a 20% energy savings in their homes. Consumers could receive additional rebate amounts for energy savings in excess of 20%. Gold Star would build on existing whole home retrofit programs, like EPA's successful Home Performance with Energy Star program.
• Oversight to Ensure Quality Installations: The program would require that contractors be certified to perform efficiency installations. Independent quality assurance providers would conduct field audits after work is completed to ensure proper installation so consumers receive energy savings from their upgrades. States would oversee the implementation of quality assurance to ensure that the program was moving the industry toward more robust standards and comprehensive energy retrofit practices.

• Support for financing: The program would include support to State and local governments to provide financing options for consumers seeking to make efficiency investments in their homes. This will help ensure that consumers can afford to make these investments.

After showing a number of houses over the past month or so, it occurred to me that it might be helpful to offer some tips on what to do when your house is showing/ being shown. I always try to give some pointers on getting a house ready for market, and am very proactive with feedback. However, sometimes it takes being on the other side to realize that alot of the things you think go without saying just, well... they don't. Here are a few things that appear to not be so obvious, but that may be helpful if you're thinking of putting your house on the market this spring...

10) If your goal is in fact, to sell the house, do not put such restrictions on showings that it becomes difficult to actually show. You’re not doing yourself any favors by saying the listing agent must be there, or that you need 2 days notice. Especially in this market, people will lose interest before they can get in, and will often likely find another house before ever seeing yours.

9) It seems that there are enough shows on HGTV about decluttering and neutralizing a home for sale, but obviously they haven’t reached a saturation point, because there are still way too many homes where there are distracting amounts of clutter, furniture, strange collections (read: 30 antique dolls in one room, everywhere you look). At the risk of repeating something you’ve heard a thousand times- people want to picture their own furniture, people and lives in the house. If they can’t, and can only picture yours, they will probably keep looking.

8) If you have more pets per square foot than people, that’s probably a good sign your house may smell like them. While you may love your 6 cats, and are totally cozy with them in your 1200 square foot house, not everyone does, and they don’t want to be haunted by the “cats of owners past” once they move in. The cats may move, but the smell often doesn’t. Most people know this.

7) When you are listing your home, whether with me or someone else, if you have surprises in store, put them in the listing. You may be used to the talking parrot that lives in your master bath, or the eerily life like mannequin in the hallway, but trust me, when someone is trying to view your house, we want to know those things BEFORE we arrive and think someone is being tortured inside.

6) Most folks don’t mind taking their shoes off to look at a house, so if you’d like us to do that, have a sign at the front door requesting that. However, if you do request it, please clean your floors. This seems to go without saying, but obviously, it doesn’t.

5) Fish is terrific. I totally agree with the idea that we should all eat fish at least 2-3 times per week. However, do everyone, including yourselves, a favor, and enjoy your seafood (and for that matter, any other smelly foods) out while your house is on the market. Even if you have the best range hood ever, it’s hard to get a heavy food smell out. I know, because I’ve got the best range hood ever (one my father says will “pull your pants right off”) and I can smell fish the next day. While your dinner may have been completely delicious, trust me, it doesn’t smell that way the next day. EVER.

4) If you’re a smoker, and you know you’re going to be putting your house on the market, start smoking outside as soon as you’ve made that decision. While you may not think it smells, trust me, it does. Trust me, also, that there is no air freshener/ cleaner/ deodorizer that can get that smell out. Even if you stop a month or two before, chances are the smell is going to hang around in your curtains, furniture, carpeting, etc. Unless the buyer is a heavier smoker than you, they will notice, and if they are not buying it with the thought of a total re-do, it will usually turn them away.

3) It’s best if you can leave your home when you know you have a showing, but everyone understands that sometimes, you just can’t. However, if you are going to be there, try not to fall asleep when you know someone is coming. IF you do, or you find yourself very sleepy, make sure you have clothes on. I’m not kidding. The only thing worse than finding an unconscious/ sleeping person in a house that’s supposed to be empty, is finding a naked one.

2) If you have a grave in your yard, and it’s not of historical significance, (say, it’s a family pet) don’t erect a headstone and put out plastic flowers like it’s a cemetery. We all understand emotional ties, but it’s hard for a buyer to visualize a family barbecue or their kids on a swing set when they feel like they’re invading a graveyard.

1) aaaand…Last but not least: Everyone has their thing, but if yours is taking photos of loved ones in their coffins, don’t tuck them in your dresser mirror next to the Disney pictures. It freaks people out. Really freaks people out. To the exclusion of everything else. I’m NOT kidding. Just put them away, and when you move, do whatever you like.

Well, it seems that summer really is starting to draw to a close, with everyone getting in their last summer vacations, and all of the stores are stocked to the rafters with school supplies (of course, that's been the case for a good long while now!).

Although August is typically a tremendously slow month in real estate, generally speaking, in my experience this month (despite the recession) has been pretty steadily busy.

If you think you are in the market, or will be soon, for a new home, though- it's still a great time to buy. There are definitely deals still to be had, but as the market picks up a bit in September, as it often does, that may well change. While there most likely won't be a huge upswing in the market, there are most certainly more buyers in the market than now.

Most importantly, if you're wavering on whether or not to make a move, remember, if you're a first time buyer, the $8000 first time buyer tax credit ends at the end of the year, and that is coming fast!

This market is still a little wacky. While it is true that there are more homes selling, and things are selling a bit more quickly, prices are still not in a good place, and it's still a difficult time to get sellers to realize that in many cases they're not going to get what they want, and sometimes, they're not going to get what they "need."

At any rate, one thing I've seen more of recently (meaning never at all before a month ago, and then 3 times since) is sellers going back after those buyers that seem interested, but perhaps not inclined to "pull the trigger" on a contract. By writing a contract in the reverse, the seller is basically able to get the buyer's attention, hopefully with something that is appealing enough (whether price, terms, etc.) for the potential buyer to sit up and take notice. While I have yet to see this work in the spirit in which it's intended, it definitely does serve to get people back to a negotiating table they have theoretically left.

All that aside, and the the fact that the market is still down, it's good to remember (especially if your home is on the market) that this is the time of year anyway when there is a bit of a slump. Certainly around any holiday weekend, but also once we get into the "thick" (literally and figuratively) of summer in Richmond. It almost seems like buyers are too sluggish to come out and look. Houses still sell, though, and it does seem that things are beginning to pick up- just not fast enough or far enough, necessarily, for the sellers, out there.

If you are a buyer, or potential buyer, what the heck are you waiting for? With the inventory still relatively high, rates still quite low, and the prices at a reasonable level- get out there and start looking. It's still a buyer's market, but it's not going to last forever!

...that could come in handy in the current market.

1) Despite the news constantly saying the rates are going up, rates are still right between 5.5- 6%. We are definitely seeing more FHA loans, and luckily, fewer loans that are from strange, unknown lenders operating out of their cars on their cell phones. (that is definitely a good thing for all of us, even though some people may not be able to get a loan that they would have been able to get a year or so ago, but they arguable should not have been able to get it then.)

2) We are definitely seeing more FHA loans. What does that mean if you're a buyer? Slightly more paperwork, and a slightly longer processing time in most cases. Typically though, the reasons FHA loans had fallen a bit out of favor was because there were so many other options out there where folks could obtain 100% or in many cases 104% financing without having to go through the FHA process. With many of those loans gone, we're definitely seeing more FHA, since they allow a loan to be made with only 3.5% down- something many loan programs won't allow now.

What does it mean for you as a seller? Again, as with the buyer, there is a bit more paperwork. There is also an FHA appraisal, slightly different from the standard appraisal. In effect, the government, guaranteeing the loan, wants to make sure they get a solid house if the purchaser defaults on the loan and they own it. Thus, you may have negotiated the entire inspection addendum, and even made the repairs, but the appraiser can come in and ask for more repairs that must be done before the loan is out of underwriting and approved.

3) Just because the market has been soft, doesn't mean that every house can virtually be "stolen". While most sellers are in fact somewhat flexible, everyone has a different motivation, and the vast majority are not desperate.

Well, with summer here, and the heat in full force (or at least the humidity!) energy consumption is definitely at a high. We've of course all gotten so spoiled by our constant air conditioning that we hardly know what to do if there's not a deep chill greeting us when we walk in the door.

Regardless of your feelings on climate change, there's scarcely a leg to stand on in defense of our general energy wasting ways. You may have read or heard about (even here) about energy audits- what they are, and what they do, and how they can help you save energy in pretty much any season.

What you may or may not know, however, is that there is a growing trend (though probably very slowly growing this way- Richmond is a bit behind the times on things like this) for energy audits to be required for the sale of a home (typically for homes only 10 years old or older).

While San Francisco and Berkeley, CA have had these measures in place twenty years or so, things are definitely spreading, primarily in the Western states. Austin, TX is in the thick of things right now, having just passed a measure requiring an audit (but not repairs/ remediation as some of the other locales) before a sale takes place.

TheWall Street Journal did a piece on this this past week-(http://tinyurl.com/rbxg5y). The law in Austin doesn't require repairs to be made, but it does require that the items needing remediation be disclosed to any potential purchasers. This is obviously causing some issues with both homesellers and real estate professionals, but seems to be the wave of the future- even though there may be some growing pains along the way.

This has already been done in the UK, and of course the Californians are more familiar with the whole package. As the tax credits and "green incentives" grow, hopefully, this seems to me to be a great way to drag some of these homes into the 21st century, and help us all use a bit less energy.

I would be curious to know what the reactions would be in this area were this to come to fruition here. I'd love some comments here, from Richmond area residents/ homesellers/ other real estate professionals.