Hope for the Best, But Plan for the Worst: Disaster Preparedness

Preparing for a disaster that may never occur is rarely at the top of my to do lists, and yet, at some point, it should be. Since September is National Preparedness Month, this seems like as good a time as any. And if you ask the folks in Napa who recently felt the jolt of a 6.1 magnitude earthquake, I bet they would tell you a little preparedness goes a long way.

In early August, just a couple weeks before that earthquake, I wrote a column recommending that folks make note of where to find essential features like shut off valves for gas and water, the electrical panel box, cable TV hookup, Internet connection, septic tank and leach field or the cleanout for the sewer lateral to the street, hose bibs, and sprinkler valves. When an earthquake knocks your house off its foundation and you don’t want your house to blow up, you don’t want to waste time looking for the gas shut off valve.

In a town like Ukiah, we have some old buildings. If you work, live, or otherwise spend time in an unreinforced masonry building, you should be aware that these are not safe in an earthquake. Generally, there is a sign stating as much near the entrance, but we often ignore these signs until the tremors begin. Of course, it’s fine to spend time in these buildings, but I would recommend figuring out where all the exits are.

At home, you may have a structurally safe house but you probably still have shelves with things that can fall off them, tall furniture that can fall on you, and glass that can pop out of window frames and cause injury. When loading shelves, resist the urge to put heavy, sharp objects overhead, especially shelves above your bed where you spend a lot of time in an unaware state.

Tall furniture should be secured to the wall in some matter. It doesn’t have to withstand huge force, just prevent the thing from tipping over. This is true whether the tipping results from an earthquake or a toddler climbing up to reach something interesting.

Once your structure is as safe as you can make it, you may want to consider rations. While old canned food may not sound appetizing right now, if you have nothing else to eat, it’ll probably sound scrumptious. Survival companies sell food kits with 20-year shelf lives. With those kits and some water, you won’t go hungry.

And how about a good first aid kit? I mean more than just Band-Aids and antibiotic ointment. I’m talking about bandages, gauze, gloves, cold compresses, scissors, antiseptic wipes, thermometer, a temporary sling, and more. A good first aid kit can make the difference between discomfort and a health disaster. I recommend a kit for your house and  smaller ones for each vehicle.

Since I can’t possibly think of everything to help you prepare, I asked Tami Bartolomei at the Mendocino County Office of Emergency Services for her recommendations. She shared this website:  community.fema.gov/connect.ti/cfghome/grouphome. Another good website is: redcross.org/prepare.

She also said this:

In the event of a large-scale disaster such as one involving the Cascadia Subduction Zone in which a 9.1 earthquake could shake for five minutes, emergency personnel will be overwhelmed. It could be weeks before outside resources arrive to help people in our county, so it’s important to prepare yourself, your family and your work place. Have a plan: do you know where you would meet your family after a disaster? Join us for 30days/30ways activities to learn more. Follow us on Twitter @mendo30days30ways or on Facebook at the Mendocino Sheriff’s page. Do your share and be prepared!

If you have questions about real estate or property management, feel free to contact me at rselzer@selzerrealty.com or visit our website at www.realtyworldselzer.com. If I use your suggestion in a column, I’ll send you’re a $5.00 gift card to Schat’s Bakery. If you’d like to read previous articles, visit my blog at www.richardselzer.com. Dick Selzer is a real estate broker who has been in the business for more than 35 years.

 

What Is Title Insurance and Why Does It Matter?

If you don’t spend much of your time buying and selling homes, you probably don’t have a clear sense of what title insurance is or why it’s important. Like many types of insurance, it’s not important–unless it is, and then it’s crucial.

People can have unrecorded or unofficial rights to your property, so it’s important to be aware of these. Title insurance is typically a guarantee from the insurance company that your ownership of (or lien on) a property is senior to other claims on the property. If there are other claims (recorded liens), a title report will reveal them and the title insurance will indicate where your ownership falls on the list with respect to other claims on the property.

Just to clarify, a lien is a legal right relative to property belonging to another person until a debt owed by that person is paid.

Some liens are unrecorded. For example, the owner of a home may borrow money from Aunt Mathilda and offer her a deed a trust to secure the loan, but not record the transaction through the Assessor’s Office. If a buyer or lender is aware of the unrecorded lien, they are beholden to it. “Unrecorded” doesn’t mean “invalid.”

When it comes to title insurance, there are two main types: CLTA and ALTA. California Land Title Association insurance includes recorded easements, deeds of trusts, a legal description, recorded owner(s), and whether property taxes are paid. American Land Title Association insurance is more comprehensive (and expensive). In addition to the elements included with CLTA insurance, ALTA insurance includes information like whether structures are built within the property lines, whether there are obvious signs of prescriptive easements (pathways used by the public – I’ll talk about these in more detail next week), and precisely where the property lines fall with regard to property improvements or roadways, new or anticipated.

Title insurance is different from other types of insurance because you’re really paying for the research. With most insurance, your premium is based on the worst coming to pass. With title insurance, you’re paying to see if something has already happened. This explains why title companies will do research on the property and present you with a preliminary report. The research discloses to you the condition of publicly available knowledge about the title of the property and tells you that the title company will insure your ownership or lien on the property subject to those conditions.

My advice to you is to read the report and ask questions. Talk to your realtor or the title company. If you’re buying a property for cash, you can opt out of title insurance, but I wouldn’t recommend it. If the seller suggests saving some money by skipping the title insurance, your sixth sense should hear sirens and see warning lights flashing wildly. Run (don’t walk) to the nearest title insurance company and sign up for title insurance.

In Ukiah, you have three options: Redwood Title Company, Fidelity Title Company, and First American Title Company. All are reputable. Redwood Title is independently owned and locally operated; the other two are company-owned and provide jobs for local folks. Policies from all three are underwritten by title insurers, so they’re all secure.

The long and short of it is this: title insurance will generally prevent you from buying a property (or lending money secured by a property) only to find out there are back taxes or recorded liens which weren’t paid; or worse yet, that the deed you were given was not signed by the true owner of the property and therefore what you paid for is worthless.

If there’s something you would like me to write about or if you have questions about real estate or property management, feel free to contact me at rselzer@selzerrealty.com or visit our website at www.realtyworldselzer.com. If I use your suggestion in a column, I’ll send you’re a $5.00 gift card to Schat’s Bakery. If you’d like to read previous articles, visit my blog at www.richardselzer.com. Dick Selzer is a real estate broker who has been in the business for more than 35 years.

Choosing the Right Neighborhood in 2014

People often spend a lot of time thinking about the house they want to live in, but not as much time considering the neighborhood. Here are some important questions to consider before making an offer on a house. Since the answers to these questions are different for different people, I’ll just pose the questions and let you answer them in a way that’s right for you. They aren’t in any particular order for the same reason; depending on where you are in your life, different issues may matter more.

What’s Your Relationship to Transportation?

If you use public transportation or prefer to walk rather than drive, you’ll want to make sure your house is close to an MTA bus stop and/or within walking distance of work, schools, shopping, and other services. Read this as “older Westside Ukiah.” If you commute to work, you’ll probably prefer quick access to the freeway, rather than having to traverse a country road out to a rural property at the end of a long day. Read this as “Potter Valley.”

How Important is Privacy?

For some, privacy is paramount. If you want to live somewhere private, you may require a more rural property with fewer neighbors. In addition to the quiet, it may be nice to be just far enough away from town, somewhere your mother-in-law won’t be tempted to stop by without calling.

Are Kids a Blessing or a Curse?

If you have children, you may be looking for a neighborhood with other families who have children roughly the same age. Look for basketball hoops, bikes, or a swing set in the yard to indicate what age neighborhood kids might be. Having a school nearby might be really convenient. On the other hand, if you’re retired and enjoy peace and quiet, you may not care to have 427 eighth graders walk past your house every afternoon or the neighbor’s teenager practice with his garage band late into the night.

What Does “Convenient” Mean to You?

If you want to be able to run to the grocery store in ten minutes, you’ll need to find a neighborhood close to town. If you want to be able to go for a hike in the woods by walking out of your back door, your choices about where to live will be more limited. You may want to locate close to a park or golf course, or not. Keep in mind, sometimes large events take place in parks; you may not want to hear the Concerts in the Park on a warm summer evening. Or, near the golf course, you may not want to wake to “FORE” bright and early on a weekend morning.

And Now For Your House

Once you’ve picked a neighborhood, it’s time to start thinking about a house that will fit your needs. How many beds and baths do you need today? How many are you likely to need in the next several years? Are you starting a family or a business that will require extra space? Are kids going off to college soon?

Are you an avid gardener who wants to vacation in your yard by replanting annuals every spring or would you like that tastefully done rock garden? Do you need room to build raised planters for veggies or will you use a frequent flyer pass to the Farmers’ Market?

Are you a handyman or woman when it comes to restoring this fixer upper, or do you need a house that’s been recently redone? Do you need a mother-in-law unit or just separate living areas under the same roof? Is the home Fido-friendly? Does it have a fenced yard? Do you want one story or two?

Trust me, you won’t find a home that meets all your needs so you need to make a prioritized list, and be clear about what you want versus what you need. Be sure to be honest with yourself, and to share this list with your realtor. He or she knows neighborhoods and houses, and can scour the Multiple Listing Service offerings to make sure you find what you’re looking for.

Just a quick reminder about tomorrow’s “Walk a Mile in Her Shoes” fundraiser and awareness raiser for Project Sanctuary. I’ve done this. You don’t have to walk a whole mile in heels, but more like 30 minutes (long enough). Learn more by visiting the Project Sanctuary website (www.projectsanctuary.org) or by calling the office at 462-9619.

Next time I’ll write about rules for renters. If there’s something you would like me to write about or if you have questions about real estate or property management, feel free to contact me at rselzer@selzerrealty.com or visit our website at www.realtyworldselzer.com. If you make a suggestion I use, I’ll send you a $5.00 gift card to Schat’s Bakery & Café. If you’d like to read previous articles, visit my blog at www.richardselzer.com. Dick Selzer is a real estate broker who has been in the business for more than 35 years.

Enhanced by Zemanta

How to Prepare for a Move

Moving can be exciting, but it tends to come with a few drawbacks (like getting all your earthly possessions from one location to another). So, this column is about some important steps to take to make your move as smooth as possible.

As I’ve mentioned before, if you’re selling your house, it is best to remove about a third of your furniture before you begin showing your house to potential buyers. Depending on where you’re going after you sell your house (e.g., out of the area, stepping up to a bigger place to accommodate a growing family or downsizing as the result of an empty nest), you will need to decide what to do with the furniture you removed. Is it coming with you or not?

If it is, you’ll need to store things for a while. If not, it may be time for the granddaddy of all garage sales. If you’re off to Hawaii to live in a small beach house, you’ll want to liquidate more than just a third of your furniture. Moving is a great time to start fresh. Throw away the old and begin anew. It can be very liberating.

Most of us know we’re moving long before we go. As soon as you know you’re moving, begin gathering the names, addresses, and phone numbers of people to inform of your move, both personal and service-related contacts. A good way to do this is to collect envelopes as you receive them in the mail. Simply put them in a folder (a year ahead of time, if you can), so you don’t forget Great Aunt Mathilda who sends your children Christmas cards each year.

If you want your house to sell sooner than later, I recommend taking care of any maintenance issues you’ve been avoiding (see www.richardselzer.com/2013/05/27/preparing-your-home-for-sale/).

Some vendors need a specific move-out date: utility companies (e.g., gas, electricity, water, sewer), the United States Post Office (USPS), your local newspaper, landscapers, cable/satellite service, and others. Be careful to orchestrate utilities with your realtor so utilities that need to be on to show the house are not turned off. At the same time, make sure they are turned off before the new occupants move in. You don’t want to be stuck paying the electricity bill for their new marijuana grow room.

As you move into your new home, the same cast of characters need to know you’re there: all your personal contacts, as well as your new utility companies, USPS, newspaper, etc. If you have school-aged children, you’ll need to enroll them in school. If you employ the services of housekeepers or landscapers, you’ll need to find new ones. Your realtor can be a great resource for recommendations.

One of the first things to do in your new home is to make a list of repairs and maintenance projects. Pull out those inspections you paid so dearly for, and decide which items are do-it-yourself projects and which ones will require professional help. Make a comprehensive list in priority order based on time, money, and urgency. For example, if you have a roof leak, it gets top billing.

Now that you’ve had a moment to breathe, and the USPS has your change-of-address order, you can start with Gr. Aunt Mathilda and send everyone a note to let them know you’ve moved. A fun way to do this is to take a family photo in front of your new home and send a photo postcard. Locally, Triple S Camera will give you 15 percent off a “We’ve Moved” postcard if you mention this column.

If you’re moving to a new area, ask your current realtor for a referral to a new realtor in that area. Your realtor will be happy to provide one and can even coordinate closing on your old home with the acquisition of your new one.

Next time I’ll write about Earth Day. If there’s something you would like me to write about or if you have questions about real estate or property management, feel free to contact me at rselzer@selzerrealty.com or visit our website at www.realtyworldselzer.com. If you make a suggestion I use, I’ll send you a $5.00 gift card to Schat’s Bakery & Café. If you’d like to read previous articles, visit my blog at www.richardselzer.com. Dick Selzer is a real estate broker who has been in the business for more than 35 years.

Enhanced by Zemanta

Consumer Confidence

Consumer confidence is a funny thing. As adults, we understand that wanting something doesn’t necessarily make it so (for example, no matter how much we want our favorite dessert to have zero calories, it doesn’t); however, with consumer confidence it’s the opposite. When enough people believe something, it becomes true. It’s not actually the belief, but rather the actions we all take as a result of our beliefs.

If we are confident that the economy is improving, that our jobs are secure, that good times are ahead; we’re more likely to spend more money. Spending primes the pump and keeps the economy moving, thus reinforcing our positive feelings about how things are going. If we are concerned that the economy is contracting, that our jobs are in jeopardy, that a decline is coming; we’re more likely to hold onto our money. Less money in the economy will slow growth and make all those negative predictions come true.

According to a recent HousingWire blog, a national survey indicates that 52 percent of Americans now believe it would be easy for them to get a home loan (as compared to 45 percent, who do not). This confidence is likely to bolster the ongoing housing recovery.

Even with poor job numbers in December and January, consumer attitudes toward the economy overall also improved, although people with a positive view are still in the minority (at about 40 percent).

The share of people who expect their personal financial situation to improve in the next year increased to 44 percent, continuing an upward trend since November 2013.

Other notable findings from the survey include:

  • Approximately 88 percent of people think home prices will either stay the same or go up in the next 12 months.
  • Only 55 percent of respondents say mortgage rates will go up in the next 12 months, and this number is on the decline.
  • About two-thirds of people think it is a good time to buy a house, which is down a couple percentage points from last month.
  • Those who say it is a good time to sell a house increased 5 percentage points from last month to 38 percent.

So, what does this all mean? Well, I think interest rates will continue to rise slowly. I also think real estate values will continue to rise. Even if we only see a 2 percent jump in prices this year, now is still a good time to buy because real estate is a leveraged purchase.

Let’s break it down. If you put 20 percent down on a $100,000 home, you’d pay $20,000. At the end of the year, that same home is now worth $102,000. It’s like money in the bank. If you add that $2,000 of value to the $20,000 you invested, you now have $22,000 of equity. The additional equity represents 10 percent of your original investment ($2,000 is 10 percent of $20,000), so you’ve increased your equity by 10 percent, even though values only went up 2 percent.

That’s all for this week. One of the things I like to do in my column is highlight local charity events. If you have one coming up, let me know and I’ll try to share the information here.

Next time I’ll write about all the things to think about before a move. If there’s something you would like me to write about or if you have questions about real estate or property management, feel free to contact me at rselzer@selzerrealty.com or visit our website at www.realtyworldselzer.com. If you make a suggestion I use, I’ll send you a $5.00 gift card to Schat’s Bakery & Café. If you’d like to read previous articles, visit my blog at www.richardselzer.com. Dick Selzer is a real estate broker who has been in the business for more than 35 years.

Enhanced by Zemanta

Would You Like Free Money? Consider a Reverse Mortgage

Would you like to receive a check from the bank to supplement your income after you turn 55 years old? If you own your own home, the equity in your home can become a source of income, and you don’t have to have any other income sources to qualify.

I know it sounds too good to be true, and I’d be lying if I said there were no strings attached; however, you can borrow against the equity in your home and use the money however you see fit, whether you want to go on a fabulous vacation or simply have a higher standard of living.

This is all possible because of something called a reverse mortgage. The bank gives you a loan based on the value of the equity in your home and how long you’re likely to live. As long as you remain in your home, you never have to pay the loan back, even if you live to be 110 years old. You can receive the payment from the bank either in a lump sum or as a monthly payment.

With a regular mortgage, you—the homeowner—pay the lender every month. Some of the payment goes toward reducing the principal (the loan amount) and some goes toward interest (the cost of borrowing the money). Each month, you have a little more equity in the home (you’ve paid off more of the loan’s principal).

In a reverse mortgage, the bank sends the homeowner a check and reduces the equity the homeowner has in the property. If a person lives so long that the amount owed is more than the home’s value, the homeowner can stay in the home and the Federal Housing Administration will cover any loss to the lender.

The amount you can get is based on the value of the home and the age of both the owners. The rates are a little higher than for a traditional mortgage, but not too much. To explain how the loan is calculated, let’s say a house is worth $350,000.00 and both owners are 60 years old the lender will make a one_time lump sum payment of $   or a monthly payment of $   . If the payments are to be monthly they will go on until the last owner passes away or moves out of the home. This means the borrower(s) never have to pay the loan themselves. Ultimately the house will be sold but not while the owners still live in it.

You’ll want to consider your heirs in all this, because you are using up part of your wealth rather than passing it on to them. When you pass away, to retain the house, your heirs will need to repay the reverse mortgage loan either by selling the home, refinancing the loan, or paying the loan with cash they have on hand. However, your heirs are not on title and have no obligation to pay off the loan. If the loan exceeds the value of the house, the heirs can simply let the lender take possession and sell the house. This will not cause any negative impact on the heirs’ credit standing.

In addition remember, while you live in the house you must keep insurance and taxes current and reasonably maintain the property.

If you’re wondering about the tax implications of this whole endeavor, don’t worry. The interest on the loan isn’t deductible until the loan is paid. In other words, as long as you live in your home and benefit from the reverse mortgage income, you’re good.

Reverse mortgages can be essential in allowing retirees to remain financially independent, even with no income and bad credit. Since the retiree won’t ever have to make any payments, the only qualifying criterion is the equity in their home.

Next time I’ll write about as-is properties. If there’s something you would like me to write about or if you have questions about real estate or property management, feel free to contact me at rselzer@selzerrealty.com or visit our website at www.realtyworldselzer.com. If I use your suggestion in a column, I’ll send you’re a $5.00 gift card to Schat’s Bakery. If you’d like to read previous articles, visit my blog at www.richardselzer.com. Dick Selzer is a real estate broker who has been in the business for more than 35 years.

Enhanced by Zemanta

COSTCO: Blessing or a Curse?

COSTCO is coming! Before I get going, I want to disclose that Realty World Selzer Realty is the listing agent for the property COSTCO will build on. That doesn’t change what I’m about to write, but it’s always important to be up front.

Will COSTCO mean boom or bust for Ukiah? When you ask someone on the street, they say:

It’s great! It’ll bring new jobs that pay higher-than-average wages for our area. It will lower the cost of consumer goods and make a greater variety of goods available locally. It will help us keep retail dollars in Ukiah and the associated sales tax, too. It’ll make Ukiah a regional shopping hub, bringing shoppers from other local communities. Those visitors will purchase goods and services from others in Ukiah like restaurants or something from a local specialty store, bolstering our local economy. The additional tax revenue will strengthen government services like police and fire protection as well as road maintenance. The increased commercial activity at the Airport Boulevard Business Park will attract other commercial endeavors to the area and we’ll see a flourishing microcosm of commercial activity. People who currently drive to Santa Rosa will save the gas, thus reducing our carbon footprint. These benefits easily outweigh any negatives that COSTCO might bring.

The next person you ask about COSTCO will tell you it’s terrible! COSTCO’s just another big box store that will drive out local businesses, cause traffic congestion specifically at Talmage and Airport Boulevard as well as other intersections, move retail profits from local businesses to COSTCO’s corporate structure, create an ocean of asphalt that contributes to global warming, and add street lights that cause light pollution which will block our view of stars in the night sky. It will be a strain on local resources (e.g., water, sewer, road maintenance) and hurt the communities from which shoppers travel to come to COSTCO. You can’t buy one 12-ounce can of baked beans; you have to buy a gallon, so the money you supposedly save by buying in bulk actually encourages overbuying and waste. These negatives far outweigh any benefits COSTCO could bring.

And the killer is, they’re both right. Whether or not COSTCO is a net gain or loss depends in large part on your personal perspective.

However, objectively (I think), I believe that the average pay for COSTCO employees is higher than the average retail pay in Ukiah, which will bode well for the average working family as they climb the housing ladder, either in a home they wish to own or rent. Also, the commercial area around Airport Boulevard will likely see more activity, which will probably increase real estate prices in that area and bolster future development.

COSTCO is likely to promote an increase in development, which may or may not benefit you personally, but it is likely to lower the cost of shopping in Ukiah.

At the end of each column I always ask if you have a question you would like to see addressed in this article. Well, if you make a suggestion I use, you earn a $5.00 gift card at Schat’s Bakery & Cafe. So let’s hear them.

Next time I’ll write about roofing. If there’s something you would like me to write about or if you have questions about real estate or property management, feel free to contact me at rselzer@selzerrealty.com or visit our website at www.realtyworldselzer.com. If you’d like to read previous articles, visit my blog at www.richardselzer.com. Dick Selzer is a real estate broker who has been in the business for more than 35 years.

 

Enhanced by Zemanta