As We Learn How Fragile the Electric Grid Is, ‘Off-Grid’ Gains Increased Appeal

Real_Estate_Today_bylineNews from our hurricane-ravaged states and from the Caribbean islands can be unsettling, even to those whose life and property weren’t affected by these events. How would life be for you if you lost electricity for several weeks, or even months?

Without electricity, there is no refrigeration, and you can’t even run a gas furnace to keep warm. If you live on well water, you couldn’t run the electric well pump, so without a manual pump (which are still available) you’d be without water. Forget the internet and charging your cell phone. Gas stations wouldn’t be able to pump gas, so you’d soon lose the use of your car or at, best, find long gas lines — unless you have an electric car powered by off-grid electricity.

Even before the devastating news from Puerto Rico, I’d been considering going off-grid in my Golden home, or at least buying a Tesla Powerwall battery pack as back-up to the electricity supplied by Xcel Energy. I have enough solar panels to power my home and my cars, but when the grid goes down, my solar panels are useless. With today’s solar power systems, you’re either on-grid or off-grid. I used to like to say that the grid is my battery. Now I’m not so confident of that.  My home sends power to Xcel during the day then receives if from Xcel at night.  As long as this  give-and-take arrangement (called “net metering”) works as designed, it makes no sense to own your own battery.   But what about when it doesn’t work?

A friend and mentor of mine, Steve Stevens, has a home powered by Xcel, but also keeps a fully-charged battery pack in his garage so when there’s a black-out he can throw a switch and run his home (and charge his cars) directly from the battery pack.  His solar photovoltaic (PV) system will continue charging the battery pack during daylight hours, which is capable of providing enough electricity to live normally during the night.

I used to think such an investment was silly, but so, it could be argued, is flood insurance — that is, until you have a flood. I’m not considering flood insurance, but I am seriously considering buying “electricity insurance” in the form of a battery back-up system for my home and possibly for my real estate office.

Even a one-day power outage could spoil food in the refrigerator and freezer. Perhaps you’ve had that experience. Such a system would help to mitigate that risk.

Maybe you read, as I did, that Tesla has suspended the production of its new Tesla Semi so it can concentrate on making Powerwall units for Puerto Rico and other areas devastated by hurricanes. Presumably, Tesla is also sending the solar panels necessary to charge those battery packs.

It’s also possible to get off the natural gas grid and heat your home with electricity.   If you’re skeptical, it’s probably because when you think of electric heat, electric baseboard or “resistance heating” comes to mind.

Resistance heating involves the use of electric coils which get hot when connected to electricity. You’ll find this same level of technology in the toaster sitting on your kitchen counter – an appliance invented in 1893.  Modern electric heating, on the other hand, is accomplished by way of a heat pump.  These devices use an electric compressor to extract heat from inside your house when it’s hot (we call that “air conditioning”) and extract heat from outdoors, even when it’s below freezing, to heat your home in the winter.

This kind of heat pump is called an “air source” heat pump because it extracts heat from the outdoor air. A more expensive but more efficient heat pump extracts heat from the earth, which is a constant 55 degrees once you reach six feet below the surface in our latitude.  It takes less electricity to extract heat from that 55-degree source than it does from the air, because the air can get much colder. Unfortunately, the cost of installing the vertical or horizontal wells required for a ground-source heat pump makes these systems much more expensive to install, though cheaper to operate.

mini-split_12,000_BTU_Klimaire_16_SEER_$645Recently I wrote about “mini-splits,” which are air source heat pumps common throughout Europe and Asia but which are just beginning to make their appearance in America. They will ultimately make our gas forced air furnaces and A/C units obsolete. They haven’t been popular here because, without using ducts, you’d require one for each room. At right is a 12,000 BTU kit that I found online for only $645. There are systems currently available that include up to four interior wall units (at the top in the image) that run off a single compressor (bottom left in the image) for under $2,000. They both heat and cool, eliminating the need for a gas furnace plus separate A/C compressor and chiller unit.

Rheem heat pump water heaterDomestic hot water can also be heated electrically using a heat pump water heater. Home Depot sells a 50-gallon Rheem model (left) for $1,199 and claims “$4,000 in energy cost savings.” It’s important to put this model in unconditioned space — or in a room with outdoor air available. The reason is that the heat pump is transferring the heat from the room into the water, so it functions like an air conditioner for the room in which it is installed. If it’s in a small room, that room can get very cold as your water gets hot! If your current furnace room has “combustion air” ducts supplying outdoor air to your gas furnace and hot water heater, those same ducts can provide the needed outdoor air when you convert to heat pumps. Just be sure to keep the door to this room closed — and not have louvered doors.

If you can also do without gas for cooking — and there are some great electric cooktops available now — you can get rid of your gas meter (saving the monthly grid connection fee) and live only off the sun.

When Buying or Selling a Pre-1978 Home, Lead-Based Paint Is a Big Deal

Real_Estate_Today_bylineYou might think that nearly 40 years after lead-based paint was outlawed that it would no longer be an issue, but you’d be wrong.

Over the past decade I have witnessed an increased rather than decreased attention to this issue.  Just read Section 10.10 of the current state-mandated Contract to Buy and Sell Real Estate (emphasis added):

“Unless exempt, if the improvements on the Property include one or more residential dwellings for which a building permit was issued prior to January 1, 1978, this Contract is void un

less (1) a completed Lead-Based Paint Disclosure (Sales) form is signed by Seller, the required real estate licensees and Buyer, and (2) Seller receives the completed and fully executed form prior to the time when this Contract is signed by all parties.”

It’s not uncommon for this requirement to be fudged by the parties and their agents, but doing so can create serious problems.

In order for this rule to be followed, it is critical that the listing agent make available to prospective buyers a lead-based paint disclosure, signed by the seller, prior to them submitting their offer. This can be done by making it a “supplement” to the MLS listin

g. The buyer’s agent must then have their buyer sign that form — and sign it themselves — and submit it with their offer.

Notice that the deadline for all parties signing is not upon submission of the contract, but upon the contract being accepted (signed) by the seller. Therefore, the listing agent should take care to see that all parties have signed the Lead-Based Paint Disclosure before allowing the seller to go under contract with a buyer.

Not only can the violation of this rule subject the buyer, seller and both agents to a fine of $16,000, it also creates an opportunity for a seller to get out of a buyer’s contract, which is otherwise very difficult for sellers to do.

Imagine, for example, a scenario in which a seller who is already under contract to sell his home receives a much better back-up offer. If it can be shown that the current contract was fully executed before the Lead-Based Paint Disclosure was signed by both parties and their agents, it is conceivable that the listing agent could cite Sec. 10.10 of the contract and declare the contract void for that reason alone, allowing the seller to accept the better offer.

The buyer would have no recourse, because, for starters, he would be admitting that the disclosure had not been signed on time, resulting in that $16,000 fine.

What Should and Shouldn’t You Fix When Preparing to Sell Your Home?

Real_Estate_Today_bylineWhen I’m interviewed by prospective clients about listing and selling their home, one of the most common questions they ask me is whether they should make a certain improvement or repair or replace a particular fixture or appliance.

This week I’d like to share with you my response to such questions.

Periodically, the National Association of Realtors does a “cost vs. value” analysis which determines the return on investment (“ROI”) for different renovations or improvements that a homeowner might make. Consistently, the ROI is under 100%.

If you’re not going to increase what you get for your home by at least what you spend on an improvement, why do it? 

 Homeowners will often make expensive improvements when they want to sell their home. My advice is to make only those improvements that you would enjoy yourself, and make them sooner, rather than later so you have an opportunity to enjoy them. Of course, you’ll want to make these improvements with an eye toward whether a future buyer might like them, but make them to enjoy yourself since, when the time comes to sell, almost no improvement you have made will return more dollars than you spent on it.

My advice to homeowners who have reached the point of selling is to concentrate on eliminating negatives instead of making improvements. Look for the things in your house which are bound to create a negative impression on a buyer.  I call them “eyesores.”

For example, replace worn carpet, especially older shag carpets. If the carpet is okay but rippled, have the carpet stretched. Refinish hardwood floors that show obvious wear. Repair and repaint damaged walls.

Replace your kitchen counters only if they would draw a negative comment in a visitor’s eye, but not just because they aren’t updated. Formica countertops of a neutral color that are in good condition may be outdated, but they rarely diminish a buyer’s interest in your home.

Does your bathroom have those 1970’s (or earlier) fixtures with matching pastel colors? Replacing them will probably not give you a return on your investment.

Of course, these are generalizations, and you really should have a set of “fresh eyes” to give you advice on your floors, walls, kitchen and bathrooms. We have 10 broker associates at Golden Real Estate and often I will bring one of them with me on the first meeting with a prospective client. Two of my broker associates are staging consultants and one even has a degree in interior design, so they can provide valuable insight.

What if one of the issues is something that is not obvious but will become an inspection issue, such as an extremely old furnace or aluminum wiring that hasn’t been mitigated?

These hidden defects need to be disclosed but it’s not typically necessary to address them in advance. Instead, save them for possible use as negotiating points when responding to inspection demands.

Let’s say that your buyer submits an inspection objection asking you to replace the 20-year-old furnace (which is working okay but beyond its useful lifespan) and to “pig-tail” your aluminum wiring. If you haven’t mitigated the aluminum wiring before listing, you can respond to the buyer’s demands by saying, “I’ll fix the aluminum wiring, but I won’t replace the furnace,” and the buyer will probably be happy.  But if you had mitigated the aluminum wiring before listing, you can’t play that card and may have to replace your furnace to keep the buyer from terminating.

Keep in mind that an old furnace and aluminum wiring are not visible to buyers the way a worn hardwood floor or rippled carpet are, and replacing the furnace or mitigating the aluminum wiring before listing will not bring you more offers, and not doing so won’t reduce the number of offers you receive.

Sellers also ask me if they should buy a transferable home warranty before listing because of their older appliances. Again, I urge sellers to save that move as an effective response to an inspection objection requesting replacement of those appliances.

If you’re wondering what you should or shouldn’t do before selling, invite us to meet with you in your home.

 

Seller’s Market Shows Continued Strength — How Long Will It Last?

The charts below show the continued strength of Jefferson County’s and Denver’s residential real estate market. The number of sold listings keeps rising despite a decline in active listings. The median sold price has doubled in just 5 years from about $200,000 to $400,000, and the average home now sells for about 100% of its listing price.

The decline in active listings is not due to a lack of new listings. The problem — if you want to call it that — is that new listings go under contract so quickly. Median days on market has been under 10 most of this year. As I’m writing this on Monday, there are 1,228 active Jeffco listings, but another 1,299 listings are under contract.  In Denver, there are 1,837 active Denver listings, but another 1,605 listings are under contract. Call me for statistics on your section of Jefferson County or Denver.

Jefferson County statistics:Jeffco_market_charts

Denver statistics:Denver_market_charts

When I Became a Realtor 15 Years Ago, I Didn’t Know What I Didn’t Know

Real_Estate_Today_bylineAs a new Realtor in 2002, I thought experience wasn’t all that important. I had taken the required courses and passed the state licensing exam on my first attempt, and I benefited from the terrific “Fast Start” training at Coldwell Banker.  How complicated could it be, I figured, to help a client buy or sell their home?

Obviously, I didn’t know what I didn’t know, and, of course, that will always be the case. But it’s clear to me that I do know a lot more now than I knew in 2002!

I still learn from every transaction, and that’s the key.  The more transactions that an agent does, the more he or she learns. That’s why we have office meetings every Monday, so that we can keep learning and share what we learn with our fellow agents.

Golden Real Estate agents participated in 104 closings over the last 24 months.  With nine active agents during that time period, that comes to an average of 11.5 closings per agent, which translates into experience you don’t get from all agents.

I advise buyers and sellers to consider how many transactions an agent has completed rather than how many years they’ve been in business. That information is available at www.FindDenverRealtors.com.

When you decide to hire a broker you can’t know what that broker doesn’t know – and that could be a lot.  Still, you’ve made a wise decision because it’s a virtual lock that they know more than you do and can more effectively navigate the often tricky waters of real estate transactions than your neighbor who insisted on trying “for sale by owner.”

All brokers are required to take 36 hours of continuing education (CE) classes every three years, and I have taken more than required. However, I think of this newspaper column as my “personal continuing education classroom.” That’s because nearly every column I write requires me to research a particular aspect of real estate. Regardless of the topic, I need to learn more before I can write about it. My practice is to send a draft of each column to one or more known experts on that topic, as well as to my broker associates, for feedback before going to press.

As a result, I can’t recall embarrassing myself by publishing a column that was factually incorrect.

Continuing education is important, and you’ll find many agents who have certifications indicating they’ve completed additional training on one or more real estate specialties. Some popular certifications I look for in other agents when referring business to them include: ABR (Accredited Buyer’s Representative), CRS (Certified Residential Specialist), GRI (Graduate Realtor Institute) and SRES (Seniors Real Estate Specialist).  These certifications point to extra training which sets them apart from agents without those certifications. Having these certifications is particularly useful when the agent does not have a high number of transactions under his or her belt.

EcoBroker is another certification that most of the agents at Golden Real Estate have (and that the newer ones are pursuing), indicating special training in energy efficiency, sustainability and solar power, which we feel is so important nowadays, both to save money for the homeowner and to combat the effects of climate change.

Because a home purchase is typically the biggest one most of us ever make, it’s critical that you arm yourself with as much useful information as you can. When you sell your home, you want to make sure that you reap all the gains you deserve.

Toward that end, Golden Real Estate is holding another of its popular workshops, next Tuesday, September 5, from 5:30 to 6:30 p.m. in our South Golden Road office.  I’ll be the primary speaker and I’ll answer your questions pertaining to both buying and selling real estate. The fee is $10, and includes hors d’oeuvres and other refreshments. It also entitles you to a one-hour personal consultation at a later date with myself and/or another Golden Real Estate agent you might meet at the workshop.  It’s important that you register in advance. You may do that by calling me at 303-525-1851 or by sending an email to me at Jim@GoldenRealEstate.com. My promise to you is that you will leave empowered to get the best deal for yourself, whether buying or selling.

 

Readers Say I Could Write a Book on Real Estate. Perhaps I Already Have!

 Real_Estate_Today_bylineI have been writing this weekly column for over a decade. The last 5 years are archived at http://www.  JimSmithColumns. com. Below are some of the topics I wrote about going back to December 2011, in case you’d like to look for any.  Each column has a link so you can download it.  I have highlighted in bold the more popular ones.

What’s a “Material Fact” That Needs to Be Disclosed by Sellers and Agents?

How Many Square Feet Is Your Home?It Depends on the Website

How to Avoid the Most Common Real Estate Mistakes

How Should You Respond to an Offer to Buy Your Home Without Listing It?

My Favorite Sustainable Practices and Home Improvements

Beware the Less Obvious Costs of Ownership When You Buy a Home

What Is Your Capital Gains Tax Liability When You Sell Your Home?

You’ve Heard About Geothermal Heating, But How Does It Work, Anyway?

Do You Have Tenant-Occupied Property? Here’s Advice for Selling It

Post-Closing Occupancy Agreements Can Work for Both Buyers and Sellers

How to Appeal the County Assessor’s Valuation of Your Home

Selling a Home on the 1st or 2nd Day (or Without Listing It) Just Isn’t Smart

First-Time Buyers & Veterans Buying a Home May Be Overlooking a Huge Tax Benefit

When the Fed Raises Interest Rate, Do Mortgage Rates Increase?

What You Need to Know About Buying a New Home from a Builder

How to Find the Right Mortgage Professional

How Do Credit Scores Affect Mortgage Interest Rates?

Dealing With Real Estate Can Be Overwhelming for Senior Citizens

Where Should Zillow Fit Into Your Home Search Process?

What’s the Difference Between a Condo and a Townhome?

The Trend Continues: Winter May Be the Easiest Time to Sell Your Home

Millennials Want to Buy, But They Think It’s Harder Than It Really Is

Some Measures You Can Take to Re-duce Your Winter Energy Bill

Should Sellers Wait for Spring to List Their Homes on the MLS?

HOAs Are Supposed to Serve Members, But Are Often Reviled

Is Your Neighborhood Literally Going to Pot?  Will It Only Get Worse?

For Homeowners Over 62, a Reverse Mortgage Could Make Sense

HOA Transfer Fees Can Be Excessive & They Benefit the Management Company, Not the HOA

Why Should Buyers Even Look for Homes When Inventory Is So Low?

Did You Know? The ‘Grace’ Period on Your Mortgage Payment Isn’t Free

Who Pays for What When You Buy or Sell Real Estate?  It’s All Negotiable

Metro Area Property Tax Rates Vary Much More Than You Might Realize

House Hunting? How Do You Find a Home That Fits Your Lifestyle?

‘High Performance’ Homes Go Far Beyond Energy Efficiency & Solar Power

What Are the Services You Can and Should Expect an Agent to Perform?

Thinking of Becoming a Realtor? You Might Think Twice Based on This Survey

Considering Solar? We Can Help You Sort Through the Financing Options

What Is a Buyer’s Recourse When the Seller Fails to Disclose a Known  Serious Defect?

Here Are Some of the Common Pricing Mistakes Made by Sellers and Their Listing Agents

What Is a “Variable Commission” and Why Should Sellers Demand It?

Whose Side Is Your “Agent” On?  What You Need to Know About Agency Laws in Colorado

Did Your Listing Agent Find Your Buyer?  He Might Have Been Acting in His Best Interest and Not Yours

Some Listing Agents Seem Confused About How to Handle Multiple Offers

Higher Property Values Mean Higher Property Taxes, But Doesn’t That Conflict With TABOR?

Why Sellers Should Want Multiple Offers and How to Get Them

Colorado’s Property Tax System Makes It Costly to Keep Vacant Land Vacant

Questions to Ask When Interviewing a  Realtor About Listing Your Home

Cheap Electricity From Renewables Is Revolutionizing the Utility Industry

Here’s Some Different Advice for Buyers and Sellers in the Current Market

Chart Demonstrates Our Seller’s Market — More Sales from Fewer Listings

As a Listing Agent, I Used to Think Buyer Agents Were Overpaid, But Not Anymore

Understanding the Resale Value of Roof-Top Solar Installations

Understanding Real Estate Property Taxes and Why They Vary So Much

Some Pros and Cons of Buying and Selling During the Holiday Season

Here’s Some of What I Learned at the Realtor Convention/Expo

Deciding When It’s Time to Downsize Is a Very Personal Decision

What Is the Value of Hiring a Realtor When You Can Sell Your Home Without One?

Is Your Denver Area Home Listed on the Right MLS?  Here’s What You Need to Know

It Can Be Quite Stressful to Buy a Home When You Have to Sell One First

Everyone Has a Friend or Relative in Real Estate, But Should You Use Him or Her?

In Our Internet-Connected Marketplace, What’s the Role of Realtors Now?

A Familiar Challenge: Mom & Dad Need to Go to Assisted Living

Social Media Can Supercharge the Marketing of Real Estate Listings

You’d Be Surprised How Many Agents Compete for Your Business

In Greening Your Home, Where Do You Get the Most Bang for Your Buck?

Realtor Association Says “Marginal Agents Threaten Industry”

What Is Marijuana’s Impact on the Real Estate Market

What Can You Do If You Don’t Have the Money for a Down Payment?

Here’s Your Guide to Appealing the Assessor’s Valuation of Your Home

What’s Your Home’s Value?  Assessor, Zillow & Others Differ Widely

A Seller’s Market Is the Worst Time to Try “For Sale by Owner”

How Should a Seller (and Listing Agent) Handle Multiple Competing Offers?

It Takes Courage (and a Good Realtor) to Sell One House & Buy Another

Fifty Shades of Green: Big & Small Ways for You to “Go Green”

Explaining the Inspection Objection and Resolution Process

Mortgage Lending Gets More Challenging All the Time; Here’s the Latest

The Senior Property Tax Exemption Explained

More Than Ever, Overpriced Homes Sell for Less Than Underpriced Ones

Realtor Association Moves to Increase Realtors’ Professionalism and Skills

Sellers Risk Losing Out If They Sell Without Putting Home on MLS

Buyers Often Pay More Than They Should (in fees) When Buying a Home

Did You Know? You Don’t Need a Roof to Benefit from Solar Power

Buying That First Home May Not Be as Impossible as You Might Believe

Negotiating Multiple Offers Can & Probably Should Resemble an Auction

How Much Does Landscaping Help to Sell a Home?

Pros & Cons of Listing Your Home for Sale During the Holiday Season

Have You Wondered Why Some Homes Don’t Sell, Even in a Seller’s Market?

The Press, With Limited Understanding of Real Estate, Is Easily Manipulated

Did You Have a Bad Real Estate Experience? Here Are Some Actions You Can Take

What Owners of Pre-1978 Homes Need to Know About Lead Based Paint

What You Can & Should Accomplish From Inspecting the Home You Buy

 The Top 5 Reasons Homes Don’t Sell, Even in Today’s Seller’s Market

Should You Remodel Your Home or Buy a New One?

“Why Isn’t My House Selling”  Consider Your Selection of Listing Agent

“All My Agent Did Was Put a Sign in the Ground and Wait for It to Sell.”

Buyers Can Now Get Email Alerts About New Listings Within 15 Minutes

Fear of Homelessness Continues to Keep Sellers From Listing Their Homes

Sellers Often Ignore Their Own Self-Interest in Selecting a Listing Agent

Remodeling? Let Habitat for Humanity Do the Demolition

Here Are Some Ways Real Estate Agents Can Save Money — at Your Expense

HDR Imaging—Raising the Bar on Real Estate’s #1 Tool, Photography

Sellers Ask Themselves: Should I Sell Now, or Wait for the “Selling Season”?

Sure, You Can Sell Your Current Home, But Can You Find a New One?

Do Pocket Listings Make Sense in the Current Real Estate Market?

Your Home’s Under Contract — Now What Should Your Do & Expect?

‘Credit Repair’ Services Can Actually Lower Your Credit Score, Not Raise It

18 Questions to Ask When Interviewing an Agent to List Your Home

New to Colorado? Most Real Estate Transactions Here Are Lawyer-Free

Trulia & Zillow Are Great, But Not for Finding Homes Actually for Sale

Metropolitan Tax Districts Add Hidden Cost to the Price of Many Homes

Here Are Some Questions That Buyers and Sellers Have About Closings

Think Real Estate Agents Are Overpaid? Much of the Time We Work for Free

You Can’t Underprice a Home, But You Can Still Overprice It in This Market

Mold – The Hidden Danger in Homes and What You Need to Know About It

How Buyers Can Make Their Offers More Attractive Than Competing Offers

An Unwary Buyer Could Be Blindsided at Closing and Lose Earnest Money

The #1 Mistake of Sellers: Not Checking Their Home’s Online Presence

Homeowner Associations: Good or Bad? Here Are Some Points to Ponder

What Are the Buyer & Seller Costs Associated With Buying or Selling a Home?

What Happens at a Real Estate Closing? Answers to Common Questions

Here Are My Favorite Easy Improvements When Moving Into a New Home

Look at How Much the Cost of Installing Solar PV on Your Home Has Dropped

Here’s My Take on Radon Gas in Your Home, Its Risks, and Its Mitigation

How to Respond to Agents Who Send You Letters or Ring Your Doorbell

National Press Reports Continue to Mislead & Confuse Local Buyers & Sellers

Yes, Virginia, You Can Buy a Home with Less Than 20% Down Payment

 

Golden Real Estate Receives National Recognition

GRE_2c_logo     San Juan Capistrano – America’s Top 35 real estate firms based on service excellence are being honored for exceptional customer service satisfaction with an industry first, a QE Award (pronounced “Quie”) “that measures and independently verifies excellence in the delivery of the highest levels of customer satisfaction and service quality in real estate in North America,” according to Quality Service Certification, Inc. (QSC), creators of the award.

The 2017 QE Award recognizes the Top 5 Large Companies, the Top 10 Midsize Companies and the Top 20 Small Companies, spanning 22 states, from Florida to California and Minnesota to Texas, and includes some of the most respected independent and well-known national and regional brand names.

The 2017 QE Award is based upon the results of an independent survey limited solely to buyers and sellers who were in a real estate transaction that actually closed with participating real estate companies from January through December 2016. Quality Service Certification, Inc. and Leading Research Corporation administer the survey process to ensure that every past customer is surveyed, preventing agents or the company from interference or influence in any way.

Golden Real Estate, Inc. was named one of the top 20 small companies — one of only four in the state of Colorado.

“At a time when consumers seek transparency, greater accountability, and trusted information to help them make better, more informed decisions and choices, tens of thousands of service professionals are electing to participate in service assessment and feedback following every transaction, which is setting a better standard for excellence,” said Kevin C. Romito, President, Quality Service Certification, Inc.