The sales office of Shelbourne Development Limited was expected to open Monday in a bid to sell units in what could become the world's tallest residential tower. Shelbourne is marketing 1,194 units for a high end Chicago Spire, a 2,000 foot tower that will sell for a minimum of $1,400 per square foot.
It translates into a minimum of $750,000 per unit, a price which is expected to further boost land prices in downtown Chicago.So far 600 interested buyers have booked appointments for a glimpse of building plans and model units at Shelbourne's sales office.
Shelbourne has joinred hands with Santiago Calatrava to build one of the most audacious architectural designs ever attempted. The building will have a unique seven sided corkscrew design to reduce wind pressure. Construction began in June 2005 and is expected to be completed by 2011.The coolest thing is that the top floor will let you see the curvature of the planet simply by looking out of the window.The project is expensive with estimates of cost reaching half a billion dollars.
A company spokeswoman told the Chicago Tribune: "There's interest in the building because it is one of a kind.' With unit prices ranging from $750,000 to $15 million, the high end tower, will appeal to a specific audience, she added.
After initially opening its office to American investors Shelbourne will offer its development overseas where it expects to sell at least 1000 units. Shelbourne chief executive Garrett Kelleher said the international road show kicks off January 23rd where it will visit London, Dublin,Moscow, Shanghai, Johannesburg,Hong Kong and other major capitals.
With the American real estate market on the downtrend skeptics are wary of the project's viability.They point out visits and actual sales are vastly different.James Kinney, president of Rubloff Residential Properties, a Chicago based high end property broker, told the newspaper, 'In this market for the Spire to get several hundred contracts to move ahead with construction will be difficult.'
To counter the slow pace of sales growth across the country, developers are throwing in discounts, which typically range from 3 to 5 percent. Also being thrown in are attractions such as free parking and free finishes such as granite counter tops.
When delivered in 2011 with 150 stories it is expected to stand taller than Chicago's Sears Towers, New York's upcoming Freedom Tower and Toronto's CN Tower. It has undergone three major design revisions since its launch in July 2005.
Pros and Cons of SIPs
SIPs or Structural Insulated Panels are becoming more and more popular in home construction. SIPs are made of two structural skins over an insulating structural core (usually expanded polystyrene--EPS). They're built in a factory and shipped to the construction site where the crew can quickly attach them to a house's framework. This can make building a home less expensive than with traditional stick-built methods, and it can also give you higher quality since everything is handled in a factory instead of on the job site. Here's a closer look at the pros and cons of SIPs:
Pros
- Since SIPs arrive to the construction site already built, building time is greatly reduced.
- SIPs are naturally resistant to mold and mildew.
- They are strong enough to resist wind, snow, and earthquakes.
- They have a high R-rating, which reduces the homeowner's energy costs.
- They're well insulated and reduce the amount of outside noise that gets inside.
- SIPs can be built to exact specifications.
- They don't warp or lose their shapes over time.
Cons
- After the panels are constructed, it's hard to make changes.
- It's hard to change wiring after the home construction is complete.
- If the factory is far away, SIPs may be costly to ship.
New York City Beats the Housing Slump
Sounds incredible, doesn't it! Can there be a place in the U.S where you bought a real estate in the last one year and watched your savings actually grow?
The answer is yes, if you were lucky enough to buy in New York City. While new home sales fell 19% nationwide in the second quarter of 2007 in Manhattan new and existing home sales more than doubled in the same period.
As far as prices go, while the national picture almost reminds people of the Depression, in Manhattan they recorded a double digit increase on average. Property dealers feel that 2007 will probably be their most profitable year.
So what has New York City got right which others have got wrong? New York has Wall Street! Its brokers and fund managers and deal makers are simply flooded with cash.The higher the Dow Jones climbs the more money and bonuses they make. Then naturally they want to make themselves as comfortable as they can.The result is that they are buying better and costlier homes. Then there are a lot of new people moving into the city particularly wealthy foreigners from Europe, Russia, China and India. They find New York cheap compared to other international cities. This feeling is helped by a falling U.S. dollar. Then again steep rentals have prompted temporary residents and frequent visitors to invest in small apartments. Not only have they saved on rent but have made a profit when they moved out!
But will things continue to be so rosy in the future? Not all seem to agree. A stronger dollar or a slump on Wall Street not to mention a terrorist attack could quickly change things.
More worrisome is the ongoing sub prime crisis. Tightening lending standards could drastically cut the flow of new money into the market causing prices to fall. In fact experts do point to a softening in prices of late. But such declines are presently confined to particular segments of the market while luxury homes and condos have suffered somewhat, the price of an average apartment has held rock steady.
With growing indications that Bernanke may ease sooner than later it probably won't be long before the party starts all over again.
The answer is yes, if you were lucky enough to buy in New York City. While new home sales fell 19% nationwide in the second quarter of 2007 in Manhattan new and existing home sales more than doubled in the same period.
As far as prices go, while the national picture almost reminds people of the Depression, in Manhattan they recorded a double digit increase on average. Property dealers feel that 2007 will probably be their most profitable year.
So what has New York City got right which others have got wrong? New York has Wall Street! Its brokers and fund managers and deal makers are simply flooded with cash.The higher the Dow Jones climbs the more money and bonuses they make. Then naturally they want to make themselves as comfortable as they can.The result is that they are buying better and costlier homes. Then there are a lot of new people moving into the city particularly wealthy foreigners from Europe, Russia, China and India. They find New York cheap compared to other international cities. This feeling is helped by a falling U.S. dollar. Then again steep rentals have prompted temporary residents and frequent visitors to invest in small apartments. Not only have they saved on rent but have made a profit when they moved out!
But will things continue to be so rosy in the future? Not all seem to agree. A stronger dollar or a slump on Wall Street not to mention a terrorist attack could quickly change things.
More worrisome is the ongoing sub prime crisis. Tightening lending standards could drastically cut the flow of new money into the market causing prices to fall. In fact experts do point to a softening in prices of late. But such declines are presently confined to particular segments of the market while luxury homes and condos have suffered somewhat, the price of an average apartment has held rock steady.
With growing indications that Bernanke may ease sooner than later it probably won't be long before the party starts all over again.
Building a House Out of Straw
A house built from straw? Sounds like something the Big Bad Wolf would huff and puff over, doesn't it? But straw bale construction has a 200-year history in the United States, and it's more fashionable than ever as people seek to build eco-friendly homes out of renewable materials.
There are two types of straw bale construction: load-bearing and post-and-beam.
Load Bearing
This is when the straw itself carries the roof load. This completely eliminates the need for wood, but it's not a system that is used often today. The lack of strong structural support limits the number and width of window and door openings. Since most eco-friendly homes are being built to incorporate passive solar strategies (which require large expanses of glass), load-bearing straw bale construction isn't ideal.
Post-and-beam Structure with Straw as an Infill Material
This method is far more common. The straw is not relied upon for structural purposes, rather it is packed into a post-and-beam frame. The straw acts as a thermal skin, which provides insulation values ranging from R-25 to R-50. Post-and-beam structure straw bale can work in most climates and has been built everywhere from Alaska to the desert Southwest to the East Coast.
When you build a straw bale house, you finish it with natural plasters (no, you don't have walls with straw sticking out all over the place) that make it look fairly normal, though some say "straw bale walls create a comforting, soft enclosure of space that is more organic in nature than formed systems."
US Housing Woes - What Lies Ahead ?
Till the end of 2005 investors in real estate had never had it so good. Bankers were only too happy to lend whatever a borrower needed. They did not go into the details like the person's credit history, whether he had a steady income or not and also if he had any other assets. Most of the time they were not even asking for a down payment. Banks were able to get away with it because they simply sold the loan to Fannie Mae or to buyers of mortgage backed securities. Buyers saw their investments appreciating by double digit figures annually. The resultant feel good factor made them go out and splurge on their credit cards.
But such good times don't last forever. With an overheating economy Bernanke was forced to raise interest rates steadily and given the fears of inflation he is likely to keep them there in the near future. The results of continuously high interest rates on the housing market have been devastating. Real Estate prices started declining since the end of 2005 and continue to decline. This decline in asset prices coupled with high interest rates and a slowing economy has hit the sub-prime market real hard. Lenders have suddenly woken up to the fact that up to 25% of the loans given by them are at risk of defaultl.What is worse is that there are no prospects of recovery in the near future.
Although the US Treasury Secretary has come out and said that sub-prime mortgages do not pose any threat to the overall economy, most investors are not so sure. Some have gone so far as to predict another depression. Although a global meltdown is not likely the risks are growing. All it needs is perhaps a couple of large hedge funds to go under and the world financial system could go into a tailspin.
With October, which is historically the worst month for the US markets, not far away every body will do well to keep his fingers crossed.
But such good times don't last forever. With an overheating economy Bernanke was forced to raise interest rates steadily and given the fears of inflation he is likely to keep them there in the near future. The results of continuously high interest rates on the housing market have been devastating. Real Estate prices started declining since the end of 2005 and continue to decline. This decline in asset prices coupled with high interest rates and a slowing economy has hit the sub-prime market real hard. Lenders have suddenly woken up to the fact that up to 25% of the loans given by them are at risk of defaultl.What is worse is that there are no prospects of recovery in the near future.
Although the US Treasury Secretary has come out and said that sub-prime mortgages do not pose any threat to the overall economy, most investors are not so sure. Some have gone so far as to predict another depression. Although a global meltdown is not likely the risks are growing. All it needs is perhaps a couple of large hedge funds to go under and the world financial system could go into a tailspin.
With October, which is historically the worst month for the US markets, not far away every body will do well to keep his fingers crossed.
Top 7 Advantages of New Construction Over Resale Homes
Once you start house hunting there is no doubt one of your first stops will be at a new homes website or community to see what they have to offer in the area you would like to live in. In fact, new homes have stepped up to win the hearts and minds of homebuyers for the better part of the past decade where we’ve seen an unprecedented explosion in new home construction and buying. What was once considered a luxury reserved for the rich and famous, new construction has opened the door to all price ranges and styles including luxury high-rise condominiums, townhouses, active adult communities and single-family homes.
There are a tremendous number of benefits to owning a new home including the ability to customize the home to your liking, meeting all the new neighbors as they move in and substantial savings in utility costs with new homes now being built to a higher, more energy efficient and green standard.
1. It’s your house. No, REALLY your house. – When you buy a resale home you are purchasing a home that someone else crafted to suit his or her lifestyle. Sometimes it’s just perfect and exactly what you are looking for but more often than not there are a few “Why did they do that?” issues with a home that you will have to renovate or remove when you move in to fit your lifestyle. When you build a new home you will be able to choose exactly what you want and where you want it so you can move in and not have to touch a thing.
2. Everyone else is new too! – Resale communities are great because you can see the neighborhood, how people care for their homes and everything is already established but those same benefits can prove to be cons when you are the only new neighbor on the block. Moving into a new home grants you the privilege of meeting the neighbors when they are also looking to meet new people and settle into the community. There won’t be any pre-established social circles to work your way into and you will be discovering new things about your neighborhood at the same time everyone else does.
3. Newer homes are more attractive when you resell… - Life happens. You might have to relocate or you make a lifestyle change a couple short years after you move in. The good news is that newer homes are more attractive to prospective homebuyers because it’s their opportunity to buy a newer home without the price premium associated with new construction. Better yet, you’ve already purchased all the appliances and upgrades for the home and many parts of the home are still under warranty making the home a great inclusive value. This will compare favorably to older resale homes that may require renovation or updating to make it livable for the modern homebuyer.
4. Location, Location, Location! YOU choose! – When you shop for resale homes the homes you find are obviously fixed to their current location. How many times have you seen a great resale that would be absolutely perfect if it were a little closer to the community clubhouse or offered a larger back yard for the kids to play? New homebuilders typically offer a range of model homes to choose from and you can usually place that model on a lot of your choice. Now you can have the home of your dreams in the cul-de-sac you’ve always dreamed of!
5. In the current market new homes may be a better deal than resale homes. – That’s right, the market shift has turned the tables. Now buyers have the market in the palm of their hands and can get some really outstanding deals on homes but you have to know where to look. Resale home owners may be willing to deal but in the past thirty days I have been able to successfully negotiate $69,117 off the asking price of a new home for a client and then shortly after located a home for another client and negotiated $91,000 off the asking price and we are still in negotiations to get even more from the builder. By the way, these home prices included upgrades! I have never met homeowners who were willing to accept a substantial reduction on the price of their home to the tune of more than $60,000. As a matter of fact, many homeowners have overpriced their homes on the market because they owe more than the home is worth and they cannot afford to go lower in price.
Buying Tip: To score a new home deal you can’t walk in and offer builders $400,000 under what they are asking for the home. Fantastic deals can be found however if you find the right buyer’s agent who specializes in new homes because their experience, relationships with builders and negotiating ability will help you save thousands of dollars.
6. That brown carpet and tiny kitchen? Soooooo 1970s! – Kitchen big enough for one? Small closets, shower only bathrooms and carpet everywhere? Not for today’s homebuyer! The modern lifestyle is drastically different from what it was even ten years ago and resale homes often lack the oomph and space to satisfy. Today’s homebuyer wants a bright, open kitchen with breakfast bar and high-end appliances. We now do most of our living in the kitchen! Soaking tubs in the master suite and walk-in closets are now considered standard staples of the modern home. New homes often feature these amenities as a part of their standard offering and are even starting to prepare homes for the future including the addition of whole house networking and walk-out basements that can be finished as future living space.
7. New homes save money with efficiency and green building techniques. – Many new homes are taking advantage of the Energy Star standard which sets forth a number of requirements that products like windows and doors must adhere to in order to achieve an Energy Star rating. In addition to Energy Star many builders are now offering green building and living options like the installation of solar panels on the roof of a home to harness the sun’s energy and convert it to electricity. If you install enough solar panels you may just have the electric company paying you for the electricity you are producing! These features are often very costly to retrofit a resale home with if it wasn’t initially built to these standards.
The next time you start searching for homes be sure to consider all of your options including new construction. When buying new construction you should take into account the fact that most new homes take approximately four to six months to build. You will also devote more of your personal time to building the home as you will need to choose home upgrades and work with your agent through the inspection and financing processes.
Happy hunting!
Miami Real Estate And The Effect Of Hollywood On Sales
Miami is a major city in the state of Florida, which covers 55.27 square miles, and is the seat of Miami-Dade County. This urban enclave is the largest city within the South Florida metropolitan area and the largest metropolitan area in the Southeastern United States with a population of 5.4 million. Miami and its surrounding cities make up the fifth largest urban area in the United States.
The importance of Miami as an international financial and cultural, and real estate giant has elevated Miami to the status of world city. Miami's cultural and linguistic ties to North, South, and Central America, as well as the Caribbean is well-entrenched, and this city is often times referred to as "The Gateway of the Americas." Florida's large Spanish-speaking population and strong economic ties to Latin America also make Miami and the surrounding region an important center of the Hispanic world.
Miami also has enshrined itself among TV and movie buffs, and on a large number of occasions has the city been the set of a wide array of blockbuster television and movie projects. Emmy-award winning drama shows such as CSI: Miami, Nip/Tuck and Dexter all take place in Miami.
The NBC show Good Morning, Miami was fictionally based around the workings of a Miami television station, as well as popular sitcoms The Golden Girls and "Empty Nest," were also based in outlying Miami Beach. In the 1980s however, one TV show, Miami Vice succeeded in revitalizing the city's image as the 'place to be' for the new generation.
The remake of the new Miami Vice film takes a colder, darker look at the city's underworld, although laid out in a cool and exciting manner. Video games like Grand Theft Auto: Vice City and Grand Theft Auto: Vice City Stories also take place in Vice City, which is a fictional city inspired by Miami, and includes some of the area’s architecture and geography.
Miami is also a mecca for Latin television and film production, owing to it's proximity to the Caribbean and Latin America. As a result, many Spanish-language programs are filmed in the many television production studios, predominantly in Hialeah and Doral. These include game and variety shows, news programs, and telenovelas, as well as daytime talk shows Cristina Saralegui and El Gordo y la Flaca. All these add to the glitzy, seductive and sweetly sinister look most folks would crave of Miami.
Throughout the past decade, Miami has emerged as one of the most vibrant real estate markets in North America. People from overseas have descended into the city and have made an unprecedented revitalization of this long neglected southern jewel. The new dynamism has carried across Biscayne Bay to Miami's worn-out downtown area, up Biscayne Boulevard, and throughout its historic east side neighborhoods.
Currently, along Miami's bay front corridor, there are around an estimated 17,000 new luxury high-rise and loft style condominiums being built or awaiting permits. That upswing has been overflowing into the adjacent Miami neighborhoods. The past decade has seen the Miami cityscape changing dramatically.
A large part of these changes have been made just over the past three years, as the city's skyline is now crowded with a mix of high rises and construction cranes. The city's real estate market has been extremely dynamic, the main Miami preconstruction condos development areas are, Downtown, Brickell, Edgewater, the Miami River as well as Coral Gables. A large number of older Miami buildings are disappearing to give way to luxury hi-rise buildings.
The city's commercial real estate market has also been very strong; it is estimated that over 4 million square feet of brand-new retail space will enter the market in the future. A flurry of real estate investments come from Latin America, the north east of the United States and also from Europe, where European investors are banking on the emerging Euro to acquire large pieces of the Miami real estate market.
Maintaining Your Homes Value - Six Quick Tips
In todays real estate market, selling your home may not be as easy as in years past. The home that stands out as "better than average" has the advantage.
One way to insure that your home sells for top dollar in the future is to keep up with the repairs and maintenance every home needs. Not only will your home remain attractive, but it will likely sell more quickly and for more money some years down the road. Being proactive about handling routine beautification and maintenance tasks will help your home retain its value over the years, and will be less costly in the long run than putting things off.
Here are six things you can do to stay on top of home maintenance issues:
1. Maintain your interior. If you have the carpets cleaned regularly it will not only improve the appearance, but will improve their wear as well. Check wood and vinyl flooring for warping and tears and replace it when needed. Make sure wood cabinets are properly cleaned and finished to improve the longevity of the wood.
2. Check for plumbing leaks. Small leaks can often be overlooked until they become large leaks. Repair the plumbing problems early. The cost of repairing water damage is often ten to twenty times the cost of repairing the leaking plumbing itself. Don't wait until the problem shows itself with a water spot on the wall or a soaked carpet. Leaks are most damaging on the second floor of a home, as the water runs inside the walls or first floor ceiling and causes extensive damage.
3. Paint your home before it really needs it. Don't wait until the paint is cracked and peeling, or you can't remember the color of the stucco. By that time you may be looking at costly repairs in addition to the painting.
4. Keep your yard in good shape. Trim the bushes and maintain the lawn and shrubs. Keep mature trees trimmed from overhanging the house so they don't deposit leaves and debris on the roof, which accelerates the aging of shake roofs. Follow your community's rules for brush clearance for fire safety.
5. Check the roof often. The rainy season is not the time to find out you have a missing or cracked shingle, or some other unseen damage. If you don't know how to check your roof, call in a roofing inspection professional.
6. Inspect your home. Walk around your home and yard frequently to look for things that need repair or replacement. Be objective. Put yourself in the place of a home buyer. What would you be looking for as you walked around the house and yard of a home you were about to buy? If your home is more than 10 years old, it is a good idea to call in an inspector and have a "Whole House" inspection. This will give you an idea of things that might need attention and can save you money on more costly repairs in the future.
Owning a home is a great joy. It's also a big responsibility. Taking on the responsibility pro actively will make home ownership more joyful, and prosperous, for you in the long run.
Investments In Property Verses Investments In Other Business
Ever since man has been earning money, he has been looking to invest his hard earned money in the right and most profitable channels. Investments have been on the minds of people since we can remember. Formidable investment options have competed with each other with shares, bonds and property leading the show. Of the three, property has always held the upper hand when it comes to a safe and sound investment option. Yet, despite all its risks, shares continue to find its own league of followers. If you are a new entrant into the investment market, you need to have a deep understanding of all the investment options in order to invest rightly. The smart investor is the one who spots the best investment option miles away.
Measuring returns:-
There are several ways to measure the returns that you get from an investment. One is to measure the net income and the other is to measure the change in the value of the asset. And of course you have to keep the risk factor in mind. In more recent times, the definition or the way by which you measure the returns has undergone a change. Returns is now defined as the percentage net income over a period divided by the value of the property or the net yield, and the percentage change in value over an equal or the same period of time. For example a property with a total yield of 15% and an increase in the value of 5% gives a total return of 20%. At the same time, the risk is defined as the volatility or the deviation over the same period of time.
Why Property?
In the US, shares were declared as the riskiest investment option in the last few years according to a survey. But they also gave the highest returns. The lowest returns were given by bonds and the risk was the minimum as well. While property fared in between the two. So wouldn’t you like to invest in a channel that does not have as much risk and at the same time, delivers a standard percentage of returns? A lot of investors look to invest a part of their income in each of the above mentioned assets. This is a smart investment policy because even if a bad situation were to arise, each one of the assets would react differently to it. Not all of them would go through a decline at the same time. The co relation of property with equities is quite less. Hence even if equities fall, it is not necessary that property will follow suit.
Sub classes within the same:-
Even within property there are two distinct sub classes. One is listed property and the other is directly held property. Of the two the later is the more stable option and also has less risks involved. So if you too are confused by the greatest investment debate of all times, then be rest assured that property definitely holds the upper hand. A two fold income source, least risks involved and an ever growing demand are what fuel’s the property market ahead. So what are you waiting for?Why Property Is The Best Investment Option Today
Each and every person in this world works 24x7 to earn. A lot of us then look to stabilize and multiply the earned money by investing it in potentially lucrative avenues. There are a lot of investment options which can be chosen. But there are risks involved as well. For example the capital market was once the chosen investment option for most investors. But the risks involved were just too many and this led to a gradual decline in the numbers. Then people looked to invest in small businesses. Over time this investment option too failed to sustain the large numbers and is now fading away. But one investment option has stood against the test of time and stayed as reliable as it ever was. Yes, we are talking about property. Property is one of the best and most recommended investment options of all times. But what is it about property that makes it so lucrative an investment option?
The positive cash flow:-
Property is probably the only investment option which allows you to have a positive cash flow all along. After all what is more attractive than making money while you own the property? A lot of people are today looking for loans with low interest rates. The trick is to look for property which will then generate a positive cash flow. A lot of people look for three to four less expensive properties than looking for one which is rather expensive as it increases the positive cash flow. Interest only loans are another way of generating positive income. Since you will only be paying the interest for the first few years, you can easily use this loan to keep the cash flow going. Then by the end of the interest only term period, most people sell or refinance the property. There are of course several other ways by which you can maximize the income that you can generate with property.
The rules of the game:-
Like any other investment, property too has its own set of rules. If you play your right cards at the right time, you will be maximizing your profits. Have you ever heard of opportunity cost? Well, it is the cost of something in terms of a lost opportunity. For example if you invest an amount like $100K, in a property in Maine, the opportunity cost would be the amount of money you could have made by investing the same money in a city like New York. The opportunity cost would also be the amount of money that you would have made by investing the same money in some other business. In property, it is extremely important that a person understands the opportunity cost factor. A lot of people try to invest in a couple of properties and then keep it for a time frame of 20 to 25 years. But what they do not realize is that in doing this they are limiting the earning potential that the property has. There are options of selling or refinancing as well which might need to be looked into before investing in ay property.
Real Estate Financing - Creative Financing Tips
This year, Americans are expected to borrow $1.33 trillion in acquiring 7.4 million houses, condominiums and co-ops. Before you do any real estate financing, if you have bad credit because of consumer debt like credit cards or personal loans, you'll want to try to eliminate or reduce this debt since it will affect your ability to qualify for a commercial or home mortgage and make the estimated monthly payment. If you have monthly obligations like car payments, credit card payments, personal loan payments, student loan payments, etc., be sure to take these into account when you are determining your bottom-line affordability figure.
If rates in the current market are high, you'll probably get a better price with an adjustable-rate loan. A fixed-rate mortgage means that the interest rate and principal payments remain the same for the life of the loan but the taxes may change. Loan programs for down payments of 20% or less require that you purchase Private Mortgage Insurance (PMI).
Interest rates may go up if a rosy picture is painted that the economy is flourishing - like more jobs being available; this can lead to inflation which will send the rates up. You'll also need to consider closing costs and the escrow account for your taxes and insurance. Also keep in mind when you're financing or refinancing that most people move or refinance within seven years.
Most of all you'll need to decide what you can afford to buy. And if a loan application isn't approved for the first time, it can always be resubmitted after modifying it, for example, like raising the amount of the down payment. If you're a first-time home-buyer it is possible that you may qualify for a lower down payment or lower interest rate; check with mortgage brokers, online mortgage companies, your county housing department or your employer to see if they know of any programs like this available.
Revealing a FICO credit score is not a requirement for most conventional or government loans like FHA loans or VA loans. Thirty-year fixed-rate mortgages offer consistent monthly payments for all of the 30 years you have the mortgage; if the market is good, you can benefit from locking in a lower rate for the full term of the loan. 15-year mortgages are an ideal option if you can handle the higher payments and if you'd like to have the loan paid off in a shorter period of time, for example, if you plan to retire.
A 20-year fixed rate mortgage term will mean higher payments, when compared to the 30-year fixed-rate mortgage. If you've applied to other lenders, when you finally do select a good lender you may have to explain why there are other inquiries from lending institutions on your credit report. Check with your CPA or accounting professional; you may be able to deduct the interest you pay on the mortgage loan and some of the financing costs of the home, like points, on your income tax return.
Be careful when working on your real estate financing; if you make too many loan inquiries, with applications, it may look like you're shopping for credit; this can be a red flag for many lenders. Keep in mind that adjustable rate mortgages are best for homeowners who aren't planning on staying with a property for a very long period of time.
Collect a few of the local home guides you see stacked up at the local grocery stores or supermarkets and look at a few of the ads in the real estate section of your Sunday newspaper for houses you might consider buying. Get lots of advice about real estate financing, mortgages, interest rates, mortgage rates, mortgage refinance, bad credit mortgages, etc., from many different sources, don't rely on one source, and think about what makes sense to you. And thinking positive about real estate financing is important but so is being realistic.
World's First Billion Dollar Home
Nestled in the heart of one of the world's poorest countries lay the construction site of all construction sites. Ranked #14 according to Forbes' latest edition of the world's richest people with an estimated net worth around forty billion dollars, Mukesh Ambani is building the world's first house with construction costs that could break the billion dollar threshold.
Mukesh Ambani serves as chairman of the India-based conglomerate Reliance Industries and is constructing a towering edifice that will be called Residence Antilla, after the mythical island. A maverick that split from his brother a few years ago over the family business, Mukesh Ambani has seen his wealth soar as the petrochemical company, Reliance Petroleum has seen profits skyrocket the last five years. With that growth as well as strategic investments in a number of other industries and developments, Ambani has become the obsession of many young men's dreams and arguably one of the most disliked people in all India.
When Mukesh Ambani joined his father's company, he recreated it, shifting its focus from textiles to petrochemicals and polyester fibers. He also oversaw the construction of sixty technologically-advanced manufacturing facilities that enabled Reliance to raise its capacity from one million tons annually to over twelve million. He also spearheaded the building of the world's largest, non-corporate governed refinery in Jamnagar, India. It produces over 660,000 barrels a day. Coupled with the other power generation and port infrastructure investments, Mukesh Ambani spent upwards of twenty-four billion dollars.
Such savvy have helped Ambani develop the conglomerate that is Reliance Industries. His most ambitious undertaking may be Reliance Infocomm. A network of information and communications technologies, Reliance Infocomm looks to connect over 1,100 cities across India with a broad array of voice, data, and other services along a fiber-optic network at the lowest cost in the world.
Part of his charm and problem is ventures like the new billion dollar home he is constructing in the financial heart of Mumbai. A nation with significant problems, Mukesh Ambani is moving forward in constructing a grand tower that will serve as his permanent residence but be the ire of peoples contentment just as long. According to architectural plans, the billion dollar house will measure in excess of 570 feet tall. It will have twenty-seven floors. Of that, six will be used to park the one hundred and sixty-eight cars he owns. Another four will be used for living quarters for the Ambani family of six. There will be one floor for vehicle maintenance. One floor set aside as a theatre floor with some expensive garden features. And one floor completely dedicated to gym equipment. The roof will have three helipads, one for him, one for his wife, and one for the kids. It is believed that a staff of 600 will be used to maintain and keep the house and its dwellers.
With hanging gardens and high ceilings, the billion dollar home on Altramount Road will be eco-friendly as well. The frame of the building will be serviced by a spine, similar to a human one that will be supported by structural pillars. Included in the construction are waterfalls and a huge garden that will cover an entire floor. The outside of the home may be even more impressive than the inside with what is being called, a living wall, running the length of the home. Plant life will scale the entire height of the building, setting a world record for the tallest continuous living thing.
That six hundred staff will be citizens in one of if not the poorest countries in the world. While the Indian economy is doing extremely well, there has been very little trickle-down to the working class citizens of the country. In fact, the amount of money that Mukesh Ambani will spend on the home is equivalent to the annual income of over 1.5 million Indian workers. Mumbai is home to over seven million slum dwellers. And an additional three to four million live in substandard housing. Mumbai is a study in contrasts. With square footage costs exceeding $1,800 in the district where Ambani is building, housing in Mumbai is hard to come by.
With the economy in India, the practices of the newly minted wealthy have ruffled the feathers of the established, old money. A generation ago, wealthy families had little desire for material possessions. Many of them avoided owning cars and lived in small apartments. They did not drive Mercedes or BMW. They did not want to have any association with appearing eccentric or indulgent. That practice has gone out the window with men like Mukesh Ambani building extravagant, opulent buildings to suit their fancy. With tracts of land unavailable, wealthy families have decided to build up. Skyscraper construction has risen in Mumbai as evidence that land is at a premium.
Recently Mukesh Ambani had construction of the billion dollar home put in jeopardy as a government agency attempted to rule the land deal that paved the way for the house illegal. The tracts were owned by an orphanage who received what was considered fair market value for the property. In fact Ambani's offer was the highest received by the orphanage. With work only a year away from completion it is difficult to believe that the government will be able to do anything more than fine Ambani if it is found that he did something illegal. But with his bid being the highest and the orphanage believing it got the best deal available Ambani hardly has a worry. Therefore he can look forward to his birthday celebration in October when a portion of the house will be made available.
Mukesh Ambani must have found his current home, the 14 story Sea Wind unsatisfactory to hold the gala. It does not have the ballroom the billion dollar home has. But it also does not have the headache.
Mukesh Ambani serves as chairman of the India-based conglomerate Reliance Industries and is constructing a towering edifice that will be called Residence Antilla, after the mythical island. A maverick that split from his brother a few years ago over the family business, Mukesh Ambani has seen his wealth soar as the petrochemical company, Reliance Petroleum has seen profits skyrocket the last five years. With that growth as well as strategic investments in a number of other industries and developments, Ambani has become the obsession of many young men's dreams and arguably one of the most disliked people in all India.
When Mukesh Ambani joined his father's company, he recreated it, shifting its focus from textiles to petrochemicals and polyester fibers. He also oversaw the construction of sixty technologically-advanced manufacturing facilities that enabled Reliance to raise its capacity from one million tons annually to over twelve million. He also spearheaded the building of the world's largest, non-corporate governed refinery in Jamnagar, India. It produces over 660,000 barrels a day. Coupled with the other power generation and port infrastructure investments, Mukesh Ambani spent upwards of twenty-four billion dollars.
Such savvy have helped Ambani develop the conglomerate that is Reliance Industries. His most ambitious undertaking may be Reliance Infocomm. A network of information and communications technologies, Reliance Infocomm looks to connect over 1,100 cities across India with a broad array of voice, data, and other services along a fiber-optic network at the lowest cost in the world.
Part of his charm and problem is ventures like the new billion dollar home he is constructing in the financial heart of Mumbai. A nation with significant problems, Mukesh Ambani is moving forward in constructing a grand tower that will serve as his permanent residence but be the ire of peoples contentment just as long. According to architectural plans, the billion dollar house will measure in excess of 570 feet tall. It will have twenty-seven floors. Of that, six will be used to park the one hundred and sixty-eight cars he owns. Another four will be used for living quarters for the Ambani family of six. There will be one floor for vehicle maintenance. One floor set aside as a theatre floor with some expensive garden features. And one floor completely dedicated to gym equipment. The roof will have three helipads, one for him, one for his wife, and one for the kids. It is believed that a staff of 600 will be used to maintain and keep the house and its dwellers.
With hanging gardens and high ceilings, the billion dollar home on Altramount Road will be eco-friendly as well. The frame of the building will be serviced by a spine, similar to a human one that will be supported by structural pillars. Included in the construction are waterfalls and a huge garden that will cover an entire floor. The outside of the home may be even more impressive than the inside with what is being called, a living wall, running the length of the home. Plant life will scale the entire height of the building, setting a world record for the tallest continuous living thing.
That six hundred staff will be citizens in one of if not the poorest countries in the world. While the Indian economy is doing extremely well, there has been very little trickle-down to the working class citizens of the country. In fact, the amount of money that Mukesh Ambani will spend on the home is equivalent to the annual income of over 1.5 million Indian workers. Mumbai is home to over seven million slum dwellers. And an additional three to four million live in substandard housing. Mumbai is a study in contrasts. With square footage costs exceeding $1,800 in the district where Ambani is building, housing in Mumbai is hard to come by.
With the economy in India, the practices of the newly minted wealthy have ruffled the feathers of the established, old money. A generation ago, wealthy families had little desire for material possessions. Many of them avoided owning cars and lived in small apartments. They did not drive Mercedes or BMW. They did not want to have any association with appearing eccentric or indulgent. That practice has gone out the window with men like Mukesh Ambani building extravagant, opulent buildings to suit their fancy. With tracts of land unavailable, wealthy families have decided to build up. Skyscraper construction has risen in Mumbai as evidence that land is at a premium.
Recently Mukesh Ambani had construction of the billion dollar home put in jeopardy as a government agency attempted to rule the land deal that paved the way for the house illegal. The tracts were owned by an orphanage who received what was considered fair market value for the property. In fact Ambani's offer was the highest received by the orphanage. With work only a year away from completion it is difficult to believe that the government will be able to do anything more than fine Ambani if it is found that he did something illegal. But with his bid being the highest and the orphanage believing it got the best deal available Ambani hardly has a worry. Therefore he can look forward to his birthday celebration in October when a portion of the house will be made available.
Mukesh Ambani must have found his current home, the 14 story Sea Wind unsatisfactory to hold the gala. It does not have the ballroom the billion dollar home has. But it also does not have the headache.
Outsmart Uncle Sam and Keep Your Real Estate Profits!
What if you could have a cool million dollars in your IRA within a few years so you'd never have to worry about retirement income?
What if you could do this without writing another check to your IRA?
The information you're about to read is unknown to most of the world.
Most people think the way to grow your IRA is to make annual contributions and let the manager of the IRA invest it in stocks and mutual funds.
Then, over a period of 20 to 40 years, it grows into a large sum of money for your retirement.
That's the thinking of conventional wisdom.
Let me tell you how I feel about conventional wisdom.
It's almost always wrong!
Let's take a look at a better way.
I speak to groups of people all over the country and sometimes
I ask how many in the room have an IRA. I have never had more than a third of the class answer yes.
So, why don't more people invest in an IRA?
Here's what they tell me:
They can't turn loose of the $2,000 or $4,000 maximum contribution.
Having the money at hand for immediate usage is a lot more important than retirement.
They never thought about it.
They feel they can invest in other investments that can produce more income.
They know they should but never seem to get around to it.
If you're one of these people, it's probably time for you to wake up and take action before it's too late.
You see, an IRA is about all we have left that our ‘’Uncle’‘ will allow us to use to grow filthy rich without paying taxes along the way.
''But my accountant tells me I can't contribute more than $2,000 for me and $2,000 for my spouse each year.''
Your accountant may be right.
There is a limit to how much you can contribute.
But wait!
Go back and ask your accountant if there is any limit on how much your IRA can make in a year from its investments.
He'll scratch his head and tell you no. . . There Is No Cap On How Much Income Your IRA Can Produce!
''OK, so tell me how I can make my IRA wealthy without making any contributions.''
Keep your shirt on, I'm getting there.
If you're a real estate entrepreneur, you're making money from buying and selling or keeping houses.
If I've trained you, you're doing this by using little or none of your own money. The objective is to create cash and cash flow by leveraging your brain, not your wallet or credit.
Your IRA Can Do The Same Thing
That's right. Your IRA can buy houses, the same way you do.
Of course, there are a few rules and more questions.
I strongly suggest you do not do this without good, competent advice and participation.
I must warn you that Uncle Sam frowns on buying a house in an IRA with the intent of flipping it quickly.
They may tax you on the profit.
Perhaps you may want to hold it in the IRA awhile before you flip it.
Perhaps you'll only do one or two a year.
I can't answer these questions for you and frankly, many accountants can't either.
Seek the best advice you can find and do what you feel is best for you.
Your IRA must be self-directed.
You shouldn't get your IRA involved in any deal you or your entity was previously involved in.
If your IRA buys a house, it should go directly from the seller to the IRA and not pass through you. Don't take back notes on houses and give or sell to your IRA.
Keep it clean.
The last thing I want you to do with your IRA cash is to buy real estate. Why?:
Because You Don't Need Money To Buy Real Estate . . . And Neither Does Your IRA
Put some deals in your IRA that don't require cash.
Of course, there are exceptions and rules. So, take the time to learn about the ROTH and use it.
If you qualify I promise you it will be a huge return on your time investment.
Can you option a property without money?
Yes!
Can you wholesale a house without money?
Yes!
Can you take a house ''subject to'' without money?
Yes!
Can you lease/option a house without money?
Yes!
Did you know your child or grandchild can have an IRA you can start without their knowledge, that can become their own when they come of age?
What a way for you to provide for your child's educational future. Without Writing A Check! Without Borrowing A Dime!
Most people spend more time buying a car, planning a vacation or taking in a football game than planning for retirement.
So, what about you?
Getting the Most Out of Your Investment!
Great, you have decided that you want to invest in real estate, perhaps you are thinking of flipping a house or thinking of renting it for long term appreciation. Regardless of your exit strategy, more likely your investment will include challenges such as finding the funds to support the project, finding the right property, dealing with contractors and so on.
The truth is that everyone invests in something throughout their lives. Some of us invest in stocks, gold, stamps, cars, their hobbies or real estate. Personally I believe in real estate not because of what the media says on the 6 o’ clock news but rather due to the fact that history shows that over 90% of all millionaires have become wealthy by owning real estate. If this is true, why isn’t everyone doing it? Unfortunately there is more to investing than most people might think. The first obstacle that most of us have to cross is coming up with the money to invest.
Who says it has to be your money to invest? Lets get high on OPM or other people’s money. Generally humans go through three phases in their lives. When we are born we are dependent on our parents, then we want to become independent and finally we realize that we cannot do everything ourselves therefore we become interdependent of others. You can easily approach your circle of influence to partner with you in a project. For example if you know someone who has some cash sitting around and he is tired of earning 2%-3% at the bank you can create a win-win relationship by offering your real estate expertise in exchange for his investment. Your expertise could include finding the property, renovating it, and taking care of the day to day management activities. The key is to remember to make sure that each one of you brings different values to the relationship. If neither of you have any investment funds but you are great buddies, it’s not going to propel you forward.
If you have owned a house in Calgary for the last couple years you should have seen a substantial equity increase in your home. The money sitting in your home is a great feeling, it gives you security and piece of mind to your family. Ask yourself the question, how much profit is that equity putting in your pocket each year? Banks nowadays will be happy to provide you or your investor partner with a PLC (personal line of credit) against your home and then you can use those funds to invest in real estate and earn a lot more than your savings account would generate.
The Calgary real estate market is so expensive, where do I buy? Probably 99% of the listings today aren’t going to fit your criteria. But that still leaves you with lot of options available to choose from. One of the biggest mistakes that I see Investors making is calling up their REALTOR® and asking them to give them a call when he sees a great deal out there. In my point of view this statement is no different than saying to a Doctor to fix your problem but you won’t let him to examine you. My suggestion to serious investors is to decide what part of Calgary or communities he is planning on investing and get familiar with the neighborhood. The investor will need to consider the type of homes he is after, general size, garage or no garage etc. The more specific the criteria the better chances a REALTOR® have of finding a solution. This approach will also forge the investor to become a specialist in the area and he will have a great insight on property values. It will take some time to go through the learning process but dividends will be rewarding especially when an undervalued property shows up on the market.
You think you’ve found the right house, how do you make sure it’s going to work? Doing too much due diligence will never get you into any trouble, not doing any research will cost you a fortune. At this point you should be educated enough to know approximately how much do certain renovations will cost. It’s worth the effort to visit suppliers to get familiar with prices. I suggest outsourcing the same suppliers as builders are using, this could easily save you 10%-25% compared to retail price. If you just need to replace a couple of doors you can find business in the city who sells recycled materials. Most of the time if you just paint it, it will look brand new and you could buy it at 1/3 of the new door. At the time of making an offer, you aren’t going to have any time to ask contractors to provide you with a quote. Plus homeowners wouldn’t appreciate strangers coming through their homes. Prior to your house hunting, you can interview a few contractors and have a general idea of what their prices are. For instance to replace a carpet in a house it would probably cost $3.50/sq.ft. supply & install or paint $2/sq.ft. I don’t recommend starting to measure floor space when you are viewing a home but you should be able to estimate an approximate cost of repairs in 5-10 minutes by using round figures to the nearest thousands. Always over estimate your expenses because it’s guaranteed that you will have surprises.
What kind of renovations should I be doing to maximize my profit? The trick here is to renovate the house to the point where the potential buyer will fall in love with it but it doesn’t cause the resale price to be above the norm in the community. According to the Appraisal Institution of Canada finished basements will only return about 1⁄2 of the investment and the greatest values are usually gained from the renovated kitchen and bathrooms. If you are planning on doing multiple renovation projects you need to set up a system to follow. You need to now exactly the type of colors, carpet, baseboards, window coverings that you are going to use. Once you have this information nailed done, you are just repeating the same process over and over until it becomes “cookie cutter” and that will save you a lot of time.
After the renovation is complete staging always helps to sell a home quicker and for a higher price. To speed up your learning curve on how to stage a house you can visit a few show homes on the weekend. You don’t need to reinvent the wheel you just need to get some ideas from what works for others.
Finally you’ve got the keys to the house and you are ready to swing the hammer. Prior to submitting your offer you’ve decided what kind of renovations you will be doing and you have an idea how much it’s going to cost. How do you orchestrate the contractors so it won’t be nightmare? First and most importantly who ever you choose to hire at whatever price, make sure that both of you understand the exact plan. The best way to avoid any misunderstanding is to have everything in writing and in great detail. If you want to establish a long term relationships with contractors it doesn’t hurt to discuss your policies and perhaps have them to sign off on it.
Keep in mind that you must take action. As with anything in life, knowledge without action equals nothing. Although, dreaming is an enjoyable and important process, only actions can transfer dreams into reality.
The Best Time to Sell a Vacation Home
Whether a vacation homeowner is trading a house in the woods for a pied-à-terre or exiting second-home ownership altogether, he or she needs to know that putting a vacation property on the market requires a different strategy than selling a primary residence.
Towns with a predominance of second homeowners have seasonal quirks to their real estate markets. Sales activity is driven not only by the time of year when most visitors descend, but also by the season when potential buyers hope to get the most use out of their homes. Pinpointing when demand ebbs and flows is the first step in deciding when to put a vacation home on the market.
On Michigan’s Upper Peninsula, where second-home buyers flock for summers on the lakes or winters on snowmobiles, the busiest sales months are from March to October. Putting a house with lake frontage on the market in the dead of winter will not attract many buyers, said Jeff Dohl, the owner of Yooper Land Realty in Iron River, Mich. Buyers want to see the house when the lake shore is not piled high with snow.
If a property must be listed in the colder months, Mr. Dohl said, selling it requires elbow grease: At one listing last February, he shoveled and drilled through several feet of ice and snow to the ground level for the benefit of two potential customers from Chicago. “They wanted to see the beach,” he said.
And while buyers are looking for lake homes in the warmer months, by late fall, Mr. Dohl, said, there are more buyers on the lookout for hunting cabins. “It shifts gears,” he said. “You move more into camps and hunting properties out in the wilderness.”
Sales activity on the East End of Long Island is driven by year-end bonuses, usually distributed in December and January. Many buyers look to close on homes by April in order to be moved in by summer, though sales are still strong throughout the summer season, too.
In Sedona, Ariz., the opposite is true; there is little foot traffic from second-home shoppers in the hottest months. “We don’t get a lot of second-home buyers over the summer,” said Lon Walters, a Sedona real estate agent. “Spring is absolutely the biggest time. It’s double of anything over fall.”
And in Truckee, Calif., 12 miles north of Lake Tahoe, sales traditionally peak after the Fourth of July, when cold summer fog settles over the San Francisco Bay area, the home base of most vacation-home buyers. The selling season goes through the winter ski season.
Rich Harter, the owner of Pacific Crest Properties, says some owners take their properties off the market if they don’t sell by the start of ski season; that way they can rent out the house to skiers. “A lot of sellers are under the misconception that winter is a slow sales time,” he said, “but that is erroneous. We sell a lot of homes in the winter, especially if there is good skiing.”
Realtors say that second-home sellers have an advantage because their homes generally have less in the way of belongings and furniture. “Vacation homeowners typically don’t have as much clutter,” said June Slusser, the owner of Coldwell Banker High Country Realty in Blue Ridge Ga. “That is so important in showing.” She noted that many of the cabins she sells are outfitted with high-end log furniture, and those that are not, are increasingly staged to create a cozy mountain atmosphere.
Those looking for a summer home want to see houses set up to look like warm-weather retreats even in the cooling days of fall, brokers say. Second homeowners in the Hamptons might not open their swimming pools until Memorial Day, and might close them up for the winter by mid-September, but Cathy Tweedy, a vice president at the Corcoran Group in Bridgehampton, recommends that sellers stretch the season. “The earlier they can open the pool and start landscaping the better,” she said. “And the longer they can keep it going, the more attractive the property.”
Five Key Things to Consider When Choosing the Estate Development for Your Investment Property
Purchasing a home or unit as an investment is often one of the biggest challenges you will face in life, outside of the purchase of your own home. We all know what we like and do not like and because of this it is really easy to buy a home that you like but quite often what you like in a home does not translate to the likes of potential tenants.
There are five key things to consider when choosing where to purchase your investment property and what Estate Development you should choose.
Key Issue 1: Choose an Estate Development with Lots of Parks Close By
Nobody wants to live in a concrete jungle. Even in large unit developments today, you will notice that developers spend an enormous amount of money ensuring they build a complex that contains at least one large area that residents can use like a park, so why would you want to buy a home in an estate that has no parks.
If you look at the majority of people who want to live in rental properties, they are one of two types of people, they either have children or are grandparents with grandchildren. Having a park close to your investment home will ensure that people will want to rent it because they know they will be able to let the children play in the park with some level on safety.
In many estate developments in Australia, the developers are ensuring that all homes are within viewing distance of a park. This means you as a parent can be working at home but still able to see you children. This will give a potential tenant with children a certain level of comfort.
Key Issue 2: Choose a Development Close To Public Transport
When I am choosing to purchase any property, especially an investment property, I always assess how close the property is to Public Transport. Throughout the world, many people are dependant on public transport and if your property is not close to public transport you may find it difficult to lease the property.
For example, my own wife comes from Brisbane in Australia, because she grew up in a city which has a very well defined train system and because of this she actually didn't get her license to well into her 20's because there was no need. This meant that when we were choosing a property to live-in we had to ensure that we were always close to the Public Transport system. I have found that people who live in cities with quality Public Transport, have a larger number of people without licenses which means if your investment property is close to public transport it will certainly attract potential tenants.
Key Issue 3: Choose a Development Close to Public Facilities
No one wants to drive a million miles or spend hours on public transport to access public facilities such as Hospitals, government services etc. The general rule of thumb that I use for choosing sites is that a range of government services such as social security, hospitals, Centerlink etc should be within a 10 km radius of the potential site.
Key Issue 4: Choose a Development Close to Schools
Many tenants are choosing today to live close to the school their children go to for one of two reasons. The first being safety and the second being for the health of the children. With the world's politicians on a major push to deal with childhood obesity, many people are moving into properties that allow their children to walk to school. Being close to school ensures that they will be safe but also ensure that they do their daily exercise.
Key Issue 5: Choose a Development Close to the Shops, Doctors etc
Most new developments today are required to include land that has a commercial use for services such as shops, doctor's surgeries, offices etc. However, some older developments have not had theses requirements and you will often find that they are more difficult to lease properties to tenants because the tenants need to travel too far to access these types of facilities.
Whilst there are many issues that will affect whether a property will be rented such as vacancy rates, number of rental properties on the market and the type of property etc ensuring that these five key elements are satisfied will give you a certain advantage to those who have not met these key issues.
How A Cash Out Mortgage Can Help You Get Your Equity And Save Money
Getting money out of the equity in your home is certainly one of the cheapest ways to get the money you need. No matter what the money is to be used for, the equity money on your home is probably the best way to pay for it. Here is how a cash out mortgage can help you to finance your projects - and do it cheaper than any other method.
In order to get a cash out mortgage, you will need to refinance your existing mortgage. The idea behind this, though, is to save money - not add to your existing debt. By waiting until you can get an interest rate that is lower than your current rate, by at least 1%, you will be able to save some money. But there is more - if you can shorten the length of your existing mortgage, by at least 5 years, you will be able to save a lot more money - possibly many tens of thousands of dollars.
Although it is possible with some lenders to refinance your mortgage for as much as 100%, or more, of the value of your home, this is not advised. To avoid having to pay Private Mortgage Insurance, you want to stay away from a mortgage that involves more than 80% of the loan to value of the home, and some lenders may only let you borrow 75% of it. This may cut down on the amount of equity you can obtain - but you still should be able to get a lot of it.
The amount of equity that you add to the total amount you owe to the lender, is the amount of equity available to you. This means you want to carefully select how much equity you will get, and it should be determined by how much you need for particular projects or bills. It is not a good idea to take out all you can. The lender may also limit the amount of equity you can obtain because they will decide how much debt, and the payments you can afford, which will be based on your credit report and current income.
A cash out mortgage is a great way to get access to your equity. However, you do need to remember that there are costs to getting a first mortgage - which involves a few thousand dollars. For this reason, you should not consider refinancing, unless you are planning on staying in that home for at least another 5 years. The added costs will take you at least 3 years just to get back your money and break even. Only after that period of time will you begin to enjoy the savings, and start seeing more equity being built up in your home.
After you get the equity out of your home, you do have the liberty of spending it the way you want. This means that you can use the money for a wide range of things including, vacations, debt consolidation, college education, getting another car, and more. Because of the low interest rate (lower than any with other form of borrowing), it gives you the best way to go as far as interest is concerned.
However, your greatest investment, though, will come from equity money that is to be put back into your home by remodeling, additions, or other improvements that you make to your home. Not only will this improve your level of living while you are in it, but it also could instantly raise the value of your home, too - giving your home even greater equity.
What the Future Looked Like Yesterday
HOW do old buildings disappear? Sometimes all at once, under the wrecking ball. But more often they fade away on little cat’s feet, first the cornice, then a doorway, then the windows, then a balcony ... leaving behind nothing but an architectural zombie.
At the moment that’s what seems to be happening with one of the most astonishing apartment houses in the Bronx, indeed in New York City: Horace Ginsbern’s fantastical but neglected 1937 art moderne essay at 1150 Grand Concourse.
At the Grand Concourse and McClellan Street, just north of the present Bronx Museum of the Arts, Mr. Ginsbern and Samuel Cohn, a developer, let loose on what Mr. Cohn called Grand Towers, probably because of its sweeping views south and west. There are four towers — that is, four seemingly separate blocks of apartments — with light courts in between. Each one has a rounded corner, and the parapet wall once formed a sort of windbreak made of strips of glass block.
The wall itself was originally topped with big metal railings in a circular futuristic pattern that resembled a ray gun. From a vantage point across the street, you can see peculiar latticework structures on the roof. These look like little Eiffel Towers with globe shapes on top.
The rooftop structures might have been Martian fortresses in a Buck Rogers episode, although period advertisements suggest a more terrestrial use: roof gardens.
Flanking the ground-floor entrance is what stops people in their tracks: a brightly colored glass-tile mural of an undersea scene in brilliant, sometimes iridescent colors. Two marine creatures the size of Great Danes — perhaps colossal angelfish — wiggle through the water, both of them chaotic whirls of pink, orange, gold, green and blue.
They are swimming toward some kind of undersea plant (a sea anemone?), itself surrounded by watermelon-size amoeba shapes with long, fingery edges. In the background are long, lazy currents of gold, silver and blue tile and some feathery underwater plants rocking back and forth.
The ends of the murals curve in to meet the doorway, and the entire assembly is set into a 15-foot-high field of speckled cast stone the color of a pencil eraser. It is decorated with rows of small square recesses that mimic classical coffers like those on the ceiling of the Pantheon in Rome. Each recess originally had a bottle-green glass disk at its center.
It is doubtful that any graffiti artist has ever had such a wildly colorful inspiration as the unknown artist who conceived the fish mural, which is unsigned. Miraculously, it is untouched by vandalism or any other kind of damage.
The drama continues in the lobby: exuberant painted chevrons on the elevator doors; partitions made of frosted glass tiles; highly figured red marble walls; and a terrazzo floor with random polygons of silky black stone floating on a green field.
Two painted murals of nominally classical inspiration depict a faun, nude dancers and a bearded man playing a fiddle with Cubist shrubbery and a distinctly menacing cactus. The murals are signed Renée Graves and C. D. Graves, but neither name can be pinpointed in directories or census records.
Grand Concourse real estate is mostly just no-frills housing these days, and at No. 1150, Buck Rogers is long gone. The parapet has been stripped down and covered with brown aluminum capping. Most of the green glass disks within reach have been pried out of their little coffers. The outer doors, which appeared to be a mix of nickel, brass and steel, were removed a few years ago. In the lobby, the signatures of the Graveses have been joined by others — “Junior,” “Dark Cide” and “DRD” — scratched into the plaster. A work crew covered the Art Deco elevator doors with brown paint a few years ago, although a skilled tenant volunteer stripped it off.
Another tenant, Beverly Beja, calls the building her “magnificent obsession.” She said she tried to save the doors, but the $20,000 it would have cost to rehabilitate them was far too much for the tenants to bear.
She lives in a two-bedroom apartment with a sunken living room and two original bathrooms — one with cobalt blue fixtures and yellow and blue tile, the other with plum-colored fixtures and rose-colored tile.
Ms. Beja says the current owner, a company headed by Labe Twerski, “has worked very, very hard” trying to repair problems that developed under previous owners. Mr. Twerski did not respond to three calls and two letters seeking comment about the entrance doors and the building.
Ms. Beja says that she hopes that her focus on a few small details might spark a larger restoration movement.
“Just buff the floors, and give the security guard a doorman’s hat, and it would be nice,” she said.
“Every day, I walk home and I think, ‘Dear God, let no one have damaged the mosaics.’ ”
E-mail: streetscapes@nytimes.com
When New Building Dries Up Resources
UNTIL five years ago, it seemed that the breakneck pace of development in Effingham County, a Savannah suburb in southeast Georgia, knew no limits.
But like other fast-growing areas across the country, Effingham had to learn that large-scale expansion often comes at a price. In the county’s case, it was the long-term integrity of the vast underground water supply that serves it as well as other major areas in the South.
“The prevalent mentality that natural resources have no end has come to an abrupt halt here,” said John A. Henry, chief executive of Effingham’s Chamber of Commerce and Economic Development Authority. Because overuse of its wells could draw in saltwater, the county can no longer rely solely on the wells for business and residential use, he explained, and it has been buying water from Savannah for the last five years.
As a result, cities in the county have had to spend millions of dollars and expect to spend millions more to try to keep up with growth. Residents’ water bills have risen significantly, and yet, the growth continues.
As recently as the early 1980s, Effingham County was still dotted with farms and corner gas stations. But in the last two decades it has grown rapidly, becoming home to subdivisions and to businesses like Wal-Mart and McDonald’s. The county’s population was 37,535 in 2000, a 46.1 percent increase from the 25,687 population in 1990, according to census figures. By 2006, it was 48,954, up another 30.4 percent.
Effingham’s development has been most noticeable in the city of Rincon, 20 miles north and slightly west of Savannah along State Highway 21, where new building permits for single-family houses rose to 268 last year from 65 in 1996. The city’s population in 2006, according to census data, reached 6,922, an increase of more than 58 percent from 2000, when it was 4,376.
The water problem became widely known about a decade ago, after years of investigation by scientists at the United States Geological Survey. They said that intense industrial and residential development had caused a cone of depression in the Upper Floridan aquifer, straining the key underground water source past its limits.
The problem in Effingham County, said Timothy Baumgartner, an engineer with EMC Engineering Services Inc., which works for Rincon, was that continued high use there of underground water could intensify saltwater intrusion in wells throughout the area served by the aquifer.
The strain on the underground supply has already caused some saltwater to be suctioned into low-lying coastline areas near Hilton Head, S.C., about 40 miles east of Rincon. Federal officials said that unless action was taken, future generations would draw saltwater instead of freshwater.
“Maybe not in one year or two,” said Steve Liotta, an Effingham County engineer, “but in 5, 10 or 15 years, wells in cities served by the Upper Floridan aquifer would increasingly become contaminated with saltwater.”
Last year, in response to the federal government’s findings, Georgia ordered sections of Effingham and all of neighboring Chatham County to lower daily groundwater use to five million gallons below 2004 levels. Rincon and other areas in the county were forced to pipe in water, from surface sources like rivers and streams, that is treated in Savannah and then sent out. In addition, no new wells could be drilled.
So far, Rincon has spent nearly $10 million to build a water treatment plant, and it is about to spend $3.5 million more to upgrade the facility. The goal is to reprocess water already used by households so that it can be reused for nondrinking purposes like watering lawns and irrigation, said David Schofield, Rincon’s acting city manager.
Stacie and Preston Taylor, who moved to a starter home in a development in Rincon four years ago and then two years later to a larger colonial in another development, were initially able to draw their drinking water from a community well. Now they must tap into municipal supplies, and that, Mrs. Taylor said, is taking a hefty bite of their household budget.
Mrs. Taylor, a mortgage banker, and her husband, a sales representative, used to pay $30 a month for their water; their monthly bill for water that now comes from Savannah is $300, and sometimes more. “It can be very hard on a family’s budget,” she said.
But the high quality of the local public schools and the “family-type, small-town feeling” in Rincon, despite its growth, offset other negatives. The Taylors have a 2 ½-year-old daughter, Kaylee, and are expecting another child in December.
Sandy Martin and her husband, Stan Milam, retirees who used to own a home near Fort Lauderdale, Fla., and now live in Springfield, another city in Effingham, said that the county had changed since they first moved there six years ago. Not only water problems but increased traffic have resulted from new development, Ms. Martin said.
The couple, who live in a three-bedroom, two-and-a-half-bath ranch on 28 acres that they bought in 2001 for less than $250,000, still draw from their own well and do not have to pay for municipal water. But their friends and neighbors pay for water, Ms. Martin said, “and they can get grumpy about that, especially when it comes time to fill their pools.”
“People complain about paying for water,” she said, “but lots of things that used to be free, like TV reception, now cost money.”
Residential real estate in Effingham remains a bargain compared with Savannah, according to LaTrelle Pevey, the owner of ERA Adams-Pevey Realty in Rincon. In today’s market, a new 1,400-square-foot subdivision house with three bedrooms, two baths and a fenced yard on one-fourth to one-half an acre in southern Effingham would cost $130,000 to $175,000. In Savannah, the same house would cost $160,000 to $195,000, Ms. Pevey said.
What prompted the decades-long land rush in the 480-square-mile Effingham County? According to V. Elaine Seabolt, the president and owner of Seabolt Brokers/Harry Norman Realtors in Savannah, the county owes its growth to two groups.
Young families, seeking to escape the higher cost of housing in Savannah, began migrating in the early 1990s in search of small starter homes selling for $125,000 and up, Ms. Seabolt said. Empty nesters, many priced out of retirement havens like Hilton Head, also gravitated to Effingham, where the climate is warm most of the year, the cost of living reasonable and the threat of hurricane damage far less than in Florida.
“The bottom line is that dirt is a lot cheaper right outside of Savannah,” Ms. Seabolt said, “and certainly less expensive than in Hilton Head.”
The Floridan aquifer system, according to the Geological Survey, is one of the most productive in the world, underpinning about 100,000 square miles in southern Alabama, Southeastern Georgia, Southern South Carolina and all of Florida. It provides water for cities including Savannah and Brunswick in Georgia; and Jacksonville, Tallahassee, Orlando, and St. Petersburg in Florida.
Effingham’s water problems are not unusual. In Naples and Tampa in Florida, in Southern California and in Scottsdale, Ariz., aquifers have similarly been stressed by intense development, Mr. Baumgartner of EMC Engineering said. But those cities, he said, do not have the saltwater problem.
Ken Lee, Rincon’s mayor, said that the city, which was “now trying to play catch-up to solve the problems,” had no plans to cut back on either residential or commercial growth because of the water problems.
But not everyone agrees that the explosive development of the last two decades should continue, according to Levi Scott, Rincon’s assistant mayor, who grew up in the city during the 1950s and 1960s.
“You hear a lot of griping at council meetings,” he said. “Some people think the city has already paid too high a price for all this growth.” So far, there is no organized opposition to growth.
Mr. Liotta, the county engineer, said the focus should be on how best to conserve water for future generations. “One way to do that,” he said, referring to the county’s new policies, “is that the more water someone uses, the more they will pay.”
Real Estate Still the Best Investment?
Impending Real Estate Doom? Not if most AMericans can have their way. Hopefully perception is reality as Americans are confident their homes are retaining, even gaining, value, according to a nationwide telephone survey conducted this month by The Boston Consulting Group (BCG). In fact, Americans are nearly as optimistic now about the rising value of their homes as they were a year ago, according to the research.
According to the survey:
- 55% of Americans say their home would sell for more money now than it would have a year ago. (Last summer, 59% of American homeowners felt that way.)
- 85% of Americans believe their house will be worth more five years from now than it is today.
- Nearly three-quarters (74%) of homeowners say they're confident they could sell their home within the next six months at a price they think it's worth.
- The majority - 63% - of Americans think real estate is a good or excellent investment.
- 76% of Americans say the current real estate market has no impact on how they're spending now. (However, 16% say they're cutting back because of a perception of lower residential real estate values.)
- Most home owners - 69% - say they're likely to make renovations or improvements to their home over the next 12 months.
- 27% of Americans say they're likely to purchase a better home over the next five years.
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