Tag Archives: REALTOR

Should Green Building Be Valued at 100% of Cost?

“Green homes face a red light”  Full Article: CNN Money

I meant to comment on this a while ago, just reread it and it really bothers me.  So I need to comment.  It’s not the lenders, nor appraisers that need to “appreciate the value,” it’s the consumer who drives the market.  If everybody was willing to pay for the green improvement at what it costs, than it would be an open and shut case, because the market would reflect the value at 100% of the market.

There are special loans that allow for the energy savings to be applied to the appraised value.  I blogged on this last month: ““Buyers: Why Green is Worth It” and the Energy Efficient Mortgage Program.”   Lets be real…when somebody builds a house and customizes it with all these great upgrades (granite, high-end cabinets, exotic wood floors, etc.) the overall cost to construct/reproduce does not typically bear out on the market. Many of these items are taste specific and the amenity adjustments given to the comparable sales are derived by the depreciated cost method or reflect the anticipated market response.  Adjustments are not typically supported by the cost to construct.

Not all appraisers are knowledgeable about appraising green features, which is huge problem.  There are different ways to come up with a value.  I blogged about this too: “Appraising Green/Energy Efficient Housing” .   Choosing an Appraiser that is knowledgeable in appraising green features is not even possible anymore…due to new regulations, aka HVCC, lenders can no longer choose the appraiser.   So somebody with no experience with green appraising may be doing the appraisal.

So builders and remodelers need to explain this to their clients. A top builder in my area even has it written in their contract…that the buyer is responsible even if the appraised value comes in low.  I know this creates tension with the buyer because they need to come up with extra funds, this wasn’t too much of a problem in an UP market, but it is now!  Explain it up front so they are at least aware that all those custom upgrades may not appraise out.

So my answer is: IT DEPENDS!

-Just my thoughts.




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“Buyers: Why Green is Worth It” and the Energy Efficient Mortgage Program.

Just finished reading:

I agree, green is worth it.  From the warm fuzzy feeling you get from doing something good for the environment: your LIVING environment and the GLOBAL environment.  Green is good because you could get a TAX credit.  Green is also good because you may quality for an Energy EFFICIENT mortgage.

Did you even know that there are special mortgages designed that allow you to incorporate the price of an energy efficient improvement into your mortgage?  I just took a fantastic continuing education class that went over some details on this type of mortgage.

HUD’s Energy Efficient Mortgage Program:  www.hud.gov/offices/hsg/sfh/eem/energy-r.cfm

1. Can be up to $8,000.  Only certain improvements/items quality.
2. You do not need to qualify for the additional funds (up to $8,000).

3. The appraisal does NOT need to come in $8,000 above.

4. A home audit will be performed.  Many utility companies  can provide.

5. The improvement is done after the loan closes.

Contact your local utility company to learn about audits.  Here’s the link to New Hampshire’s: NH Home Performance with ENERGY STAR®

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Take it on the road: Portable Technology

I can’t make up my mind. There are so many portable technology devices out there to consider, the combination of these tools make my mind boggle.  I do enjoy new technology, but laughed at my husband when he purchased an iPod, and got a bit angry when he picked up a Kindle.  After all, I read more than him.  I have since come around…all these portable devices can do amazing things. I would still never buy all these pieces of electronics and carry them around…but combined?

As an appraiser, and Realtor, the portable device I depend on most is my cell phone…aka my Smart phone. I am in my car all day on occasion. For the past year I’ve had so much trouble with my Verizon Blackberry…more my problem, not the device itself.   There’s no coverage for Verizon or AT&T in my home-office, my Blackberry is missing a camera (I sorely miss), and the data fees are just too high for the amount of time I actually use it.

After tinkering on my husband’s Apple iPhone on a long trip to Canada,  I realized a larger screen would make the phone more functional to surf online, and of course all the other apps available for the iPhone. I did try the Verizon Droid, and liked it, but only kept it a month. I wasn’t sure if I wanted to commit to another 2 years with Verizon and was having email problems. Going without reliable email for a month started me thinking, “Do I really need email on the road?”. I was actually debating picking up the Apple iPod touch (has Wi-fi) then using it for intermittent email and accessing the local MLS. Free wifi locations are popping up everywhere.  So now I’m thinking outside the box and wonder: “ What do I really need?”.

The new Apple iPad is making me rethink the tools I use in the field. The ability to get the iPad with 3G is a fantastic idea, saving you the data fee from your cell provider and no contract.  This is better than a tablet, a PMP or MP3  player,  an E-book reader, and it certainly beats any Smart phone.  The larger screen would make sketching floor-plans and working on MLS virtually head-ache free.

I will be dumping my Smart phone, for a Dumb one, and picking up the iPad.  Now I need to make up my mind whether to get the iPad with the basic Wi-fi or go with 3G. The 3G will cost approximately $30 month for unlimited use, but that’s still cheaper than the data charge for my cell.  Oh, and there’s the decision on which Dumb phone to get…of course it will need a camera…the iPad doesn’t have one.  Hmm, more decisions.

Apple’s Release of the iPad: www.apple.com

Apple unveils its tablet computer, the iPad: San Francisco Chronicle

Check out my fellow appraiser blogger with price points and additional details on the iPad: rebliss.com


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