6 Simple Steps to Creating Online Marketing Videos:
http://bit.ly/agfWJ6
Friday, February 26, 2010
Thursday, February 25, 2010
Too Early to Discuss Housing Appreciation Rates?
US News & world Report published an article by Luke Mullins about housing appreciation rates expected over the next ten years. Moody’sEconomy.com provided the data and research of 364 MSA’s. Population projections, employment data, and industry trends were factors in determining the housing appreciation rates for each location.
They selected the top 10 cities with the greatest average annual housing price appreciation and I have summarized the information in the following chart.
CITY 2nd Qt Median Home Prices Estimated Annual Appreciation Primary Reason
Silverdale, WA $250,000 9% Military
Glen Falls, NY $178,950 7% Industry
Corvallis, OR $232,000 5% Government
Santa Fe, NM $262,250 5% Government
Decatur, Ill $92,900 5% Industry
Duluth, MN $129,550 5% Affordability
Charleston, SC $210,000 5% Military
Pittsburgh, PA $95,500 5% Diverse Industry
Fort Collins, CO $208,000 4% Energy
Charlotte,NC $150,000 3% Diverse Economic Base
This crystal ball shows a reasonable annual appreciation rate which seems to represent a more stable economic vision. However, in my opinion, there are several key points to consider as you consider the above information:
1. Most of the top 10-cities probably experienced moderate appreciation during the housing bubble and this may reflect the normal trend.
2. A stark omission of any city from Florida, Nevada, Arizona, Texas or California.
3. Most MSA’s have experienced a decrease in housing prices over the past three years. It varies but from 10-40% decrease in housing prices.
4. First American CoreLogic, Inc. a real estate information company reports that negative equity is concentrated in 5-states:
Nevada 70% of all of its mortgages are underwater
Arizona 51%
Florida 48%
Michigan 39%
California 35%
If this study is close to being accurate, the top 10-cities with the greatest average annual housing appreciation over the next ten years will be excellent places to buy. The remaining cities, especially in NV, AZ, FL, MI, and CA, will not return to 2005 housing prices for decades to come. You should draw your own conclusions.
They selected the top 10 cities with the greatest average annual housing price appreciation and I have summarized the information in the following chart.
CITY 2nd Qt Median Home Prices Estimated Annual Appreciation Primary Reason
Silverdale, WA $250,000 9% Military
Glen Falls, NY $178,950 7% Industry
Corvallis, OR $232,000 5% Government
Santa Fe, NM $262,250 5% Government
Decatur, Ill $92,900 5% Industry
Duluth, MN $129,550 5% Affordability
Charleston, SC $210,000 5% Military
Pittsburgh, PA $95,500 5% Diverse Industry
Fort Collins, CO $208,000 4% Energy
Charlotte,NC $150,000 3% Diverse Economic Base
This crystal ball shows a reasonable annual appreciation rate which seems to represent a more stable economic vision. However, in my opinion, there are several key points to consider as you consider the above information:
1. Most of the top 10-cities probably experienced moderate appreciation during the housing bubble and this may reflect the normal trend.
2. A stark omission of any city from Florida, Nevada, Arizona, Texas or California.
3. Most MSA’s have experienced a decrease in housing prices over the past three years. It varies but from 10-40% decrease in housing prices.
4. First American CoreLogic, Inc. a real estate information company reports that negative equity is concentrated in 5-states:
Nevada 70% of all of its mortgages are underwater
Arizona 51%
Florida 48%
Michigan 39%
California 35%
If this study is close to being accurate, the top 10-cities with the greatest average annual housing appreciation over the next ten years will be excellent places to buy. The remaining cities, especially in NV, AZ, FL, MI, and CA, will not return to 2005 housing prices for decades to come. You should draw your own conclusions.
Wednesday, February 24, 2010
Charlotte, NC in a Pop-up Format Video
An urban development history of Charlotte, NC in animated pop-up book format by Rob Carter, Metropolis. http://bit.ly/9yhdtR A video worth watching!
Tuesday, February 23, 2010
Partisan - Nonpartisan- OH NO!
“Bipartisan should be replaced with Nonpartisan” a commentator used this phrase and hopefully it will start a shift in Washington DC dialogue. However the tenor of debate in Washington DC, we must remain positive, motivated, enthused, and engaged to reinvent and rebrand ourselves in 2010.
Source: Jack Ohman
Source: Tribune Media Service Monday, February 22, 2010
39 Social Media Tools
Article by Jason Baer posted on Socialmediatoday lists the 39 social Media Tools he uses daily. http://bit.ly/9BVAnq
If you are starting your social media journey, select several important forums and learn the power of each before branching off using more advanced tools. My main focus thus far is learning and using LinkedIn. http://www.LinkedIn.com/in/djohnsonpe. I started the Land Development Group on LinkedIn just over 1-year ago. This group now has over 1,370 members from around the globe.
In my opinion, selecting two or three social media tools that best serve your goals is the best approach because of the time. If you do join a site such as LinkedIn, participate, give rather than take, and engage in meaningful discussions. This is not a fad!
Although I am far from an expert on LinkedIn, I do know how to use the site. If you should have any questions about its capabilities as a means to achieve your goals, please let me know.
If you are starting your social media journey, select several important forums and learn the power of each before branching off using more advanced tools. My main focus thus far is learning and using LinkedIn. http://www.LinkedIn.com/in/djohnsonpe. I started the Land Development Group on LinkedIn just over 1-year ago. This group now has over 1,370 members from around the globe.
In my opinion, selecting two or three social media tools that best serve your goals is the best approach because of the time. If you do join a site such as LinkedIn, participate, give rather than take, and engage in meaningful discussions. This is not a fad!
Although I am far from an expert on LinkedIn, I do know how to use the site. If you should have any questions about its capabilities as a means to achieve your goals, please let me know.
Friday, February 19, 2010
6 Secrets to Successful Blogging
From eRealEstate.com, Posted by Mark Watters 2/17/10
http://bit.ly/bYHWnb
Have a Plan
Share your Passion
Know your Audience
Interact with Industry Partners
Maintain Email List
Giver rather than Take
http://bit.ly/bYHWnb
Have a Plan
Share your Passion
Know your Audience
Interact with Industry Partners
Maintain Email List
Giver rather than Take
Thursday, February 18, 2010
Homebuyer Tax Credit Timeline
In an article by Holden Lewis , Bankrate.com included the following timeline illustration showing the benchmarks homebuyers need to consider from now until April 30th. The key is a homebuyer will need to be under contract by April 30th to be eligible for the tax credit. The program expires at the end of April and it is difficult to imagine this program resurfacing anytime soon.
There are several points that need to be emphasized:
1. FHA insurance premiums are set to increase on April 2nd to 2.25%. This is called “MI” which is similar to “PMI” for conventional loans. This “MI” is added to the mortgage amount. This will increase the monthly cost to own a home.
2. Interest rates may trend upward in late March or early April due only to the Federal Reserve actions. Interest rates are predicted to rise this year – refer to my previous post. This will increase the monthly cost to own a home.
3. Anyone with less than a 580 credit score may be required to have a 10% down payment.
4. In a buyer’s market, it is not uncommon for seller to contribute to the buyers closing costs. The FHA changes will reduce seller concessions from 6% to 3%. This will cause buyers to have more cash to close.
5. As the deadline nears, price negotiation strategies change from buyer to the seller.
Currently 1 of 4 mortgage applications are FHA. As April 30th nears, the best time to buy a home “in our lifetime” will come to a close. If you don’t have a fantastic credit score, the prospects of qualifying for a mortgage after April 30th will become much more difficult but not impossible – as long as you bring cash to the table.
Housing has always been the bellwether industry as the economy recovers from a recession. There are multiple adjustable rate mortgages resets periods which will further impact our economic recovery. This is important due to the high unemployment rate and the ability of homeowners to pay their mortgage once the interest rates are reset.
This above graph from Credit Suisse illustrates the magnitude of the mortgage problem later in 2010. Although this will flood the supply and cause downward pressures on pricing, it will most likely occur AFTER April 30th. If a buyer is waiting for prices to decline because of the resets and take advantage of lower prices, they are not watching the correct indicator. Interest rates will be the governing factor and FHA’s rules will make it more difficult for homebuyers to buy.
If you or someone you know are interested in buying a home, you should seriously consider now as the best time to purchase your home!!
1. FHA insurance premiums are set to increase on April 2nd to 2.25%. This is called “MI” which is similar to “PMI” for conventional loans. This “MI” is added to the mortgage amount. This will increase the monthly cost to own a home.
2. Interest rates may trend upward in late March or early April due only to the Federal Reserve actions. Interest rates are predicted to rise this year – refer to my previous post. This will increase the monthly cost to own a home.
3. Anyone with less than a 580 credit score may be required to have a 10% down payment.
4. In a buyer’s market, it is not uncommon for seller to contribute to the buyers closing costs. The FHA changes will reduce seller concessions from 6% to 3%. This will cause buyers to have more cash to close.
5. As the deadline nears, price negotiation strategies change from buyer to the seller.
Currently 1 of 4 mortgage applications are FHA. As April 30th nears, the best time to buy a home “in our lifetime” will come to a close. If you don’t have a fantastic credit score, the prospects of qualifying for a mortgage after April 30th will become much more difficult but not impossible – as long as you bring cash to the table.
Housing has always been the bellwether industry as the economy recovers from a recession. There are multiple adjustable rate mortgages resets periods which will further impact our economic recovery. This is important due to the high unemployment rate and the ability of homeowners to pay their mortgage once the interest rates are reset.
This above graph from Credit Suisse illustrates the magnitude of the mortgage problem later in 2010. Although this will flood the supply and cause downward pressures on pricing, it will most likely occur AFTER April 30th. If a buyer is waiting for prices to decline because of the resets and take advantage of lower prices, they are not watching the correct indicator. Interest rates will be the governing factor and FHA’s rules will make it more difficult for homebuyers to buy.
If you or someone you know are interested in buying a home, you should seriously consider now as the best time to purchase your home!!
Wednesday, February 17, 2010
Due Diligence Report - Zoning Restrictions & Bulk Requirements
Each zone will have certain restrictions imposed to guide development patterns on each specific property. As an example, a residential land use with R-4 zoning classification; in this case 4 lots per acre or may be defined by lot size i.e. 10,000 sq. ft. minimum.
The bulk requirements listed below are shown on the single family lot illustration. If an applicant or the property owner wants to change any of the bulk requirements i.e. change the minimum lot size to 8,000 sq. ft. minimum, government must approve of this change through a variance procedure. In many over developed areas, variances to the bulk requirements are difficult if not impossible to obtain. In growing communities, government officials will at least listen to and approve/disapprove the variance request on its merits. It is incumbent upon the applicant to make the case why the variance should be approved by local government.
Minimum Lot Size: 10,000 sq. ft.
Maximum Density: 4 Unit per acre
Minimum Lot Width: 75-ft.
Minimum Lot Frontage: 25-ft.
Minimum Lot Depth: 100-ft.
Front Setback: 25-ft.
Side Yard Setback: 10-ft.
Minimum Rear Yard Setback: 25-ft.
Max. Project Impervious Surface: 25%
The bulk requirements listed below are shown on the single family lot illustration. If an applicant or the property owner wants to change any of the bulk requirements i.e. change the minimum lot size to 8,000 sq. ft. minimum, government must approve of this change through a variance procedure. In many over developed areas, variances to the bulk requirements are difficult if not impossible to obtain. In growing communities, government officials will at least listen to and approve/disapprove the variance request on its merits. It is incumbent upon the applicant to make the case why the variance should be approved by local government.
Subdivision Bulk Requirements - as an example:
Minimum Lot Size: 10,000 sq. ft.
Maximum Density: 4 Unit per acre
Minimum Lot Width: 75-ft.
Minimum Lot Frontage: 25-ft.
Minimum Lot Depth: 100-ft.
Front Setback: 25-ft.
Side Yard Setback: 10-ft.
Minimum Rear Yard Setback: 25-ft.
Max. Project Impervious Surface: 25%
Typical constraints on property are easements or rights-of-ways imposed on the property resulting from various actions by the land owner or government. As an example, a single family residential zone may have a 10-foot wide shade tree or utility easement along the front property line. This easement may restrict the property owner from using this 10-ft. wide area for their enjoyment and use. Many land owners have sold rights-of-ways to utility companies for the installation of overhead high tension power lines. The width of these easements will vary but may be as wide as 300-ft. and traverse the property at any angle. Not only do these ROW’s restrict the use of the property but the development pattern is restricted and the marketing potential of the land is diminished.
Other easements that restrict the use of property may be for the installation of public utilities i.e. sewer lines, water lines, storm drainage systems, or for ingress-egress. As outlined in a previous post, flood plains, jurisdictional streams, buffers, and wetland areas will also be illustrated on the property survey and restrict the development pattern of the property.
Tuesday, February 16, 2010
Charlotte Business Journal Article
On 2/15, the following article “Fewer Opt for Adjustable Rate Home Loans” by Jeff Clabaugh was published in the Charlotte Business Journal. http://bit.ly/dyAypN
His research shows that the low interest rates are causing more homeowners to refinance their mortgages than cause buyers to buy. It was reported that two out of three mortgage applications were for refinancing and most opting for fixed rate mortgages.
Buyers will remain on the fence until the interest rates start to trend up or if they think the prices have hit bottom. Each day, predictions from experts are published for all to read and consider. Remember, the experts caused our problems today. You have to do your own research. Just because applicants are seeking fixed rate mortgages, it doesn’t mean that an adjustable is not right for you. There are many mortgage loan programs on the market and the pendulum has swung to more consumer protection. A FHA adjustable rate mortgage program should be considered based on your own circumstances with the fist reset in 5-years.
In my opinion, this mortgage program is perfect for a single professional. The only question that should be asked – almost like a job interview – “Where do you see yourself in 5-years?”
Remember to look at trends and not year-to-year comparisons. As an example, in the article, it states that in January 2010, the number of homes sold in Charlotte increased and the average list price increased. However, both statistics were lower than in December 2009. Bouncing along the bottom!
It is not a mystery why buyers are not in the market and there are a multitude of reasons. The most compelling explanation is that they are listening to the experts rather than understanding their own circumstances and answering the question – “Where do you see yourself in 5-years?” Based on the answer, should you buy today when all of the stars are aligned for buyers?
His research shows that the low interest rates are causing more homeowners to refinance their mortgages than cause buyers to buy. It was reported that two out of three mortgage applications were for refinancing and most opting for fixed rate mortgages.
Buyers will remain on the fence until the interest rates start to trend up or if they think the prices have hit bottom. Each day, predictions from experts are published for all to read and consider. Remember, the experts caused our problems today. You have to do your own research. Just because applicants are seeking fixed rate mortgages, it doesn’t mean that an adjustable is not right for you. There are many mortgage loan programs on the market and the pendulum has swung to more consumer protection. A FHA adjustable rate mortgage program should be considered based on your own circumstances with the fist reset in 5-years.
In my opinion, this mortgage program is perfect for a single professional. The only question that should be asked – almost like a job interview – “Where do you see yourself in 5-years?”
Remember to look at trends and not year-to-year comparisons. As an example, in the article, it states that in January 2010, the number of homes sold in Charlotte increased and the average list price increased. However, both statistics were lower than in December 2009. Bouncing along the bottom!
It is not a mystery why buyers are not in the market and there are a multitude of reasons. The most compelling explanation is that they are listening to the experts rather than understanding their own circumstances and answering the question – “Where do you see yourself in 5-years?” Based on the answer, should you buy today when all of the stars are aligned for buyers?
Monday, February 15, 2010
FHA Changes
This article was posted by Allen Tate Mortgage, Charlotte, NC.
Most of you have probably heard about the upcoming changes being recommended by FHA. On January 21, HUD announced an increase in the upfront Mortgage Insurance Premium (MIP) from the current 1.75% to 2.25%. On a $100,000 loan, the upfront MIP will increase from $1,750 to $2,250. Using an interest rate of 5.0%, the monthly P&I would increase from $546.22 to $548.90, a difference of just $2.68.
Changes will be effective with case numbers issued by HUD on or after April 5, 2010. To help manage your clients’ expectations, please remember that case numbers are issued only upon receipt of a completed application by the lender. The cost to buyers is nominal, and more importantly, the MIP can be financed in the mortgage amount so it does not affect cash out of pocket. Because HUD is “self-funded,” these premiums provide income for HUD to maintain reserve requirements.
Also outlined as part of the new requirements are increasing audits for lenders that have large delinquencies with FHA. This will enable HUD to revoke a lender’s ability to originate loans if results indicate unacceptable credit decisions. Simply put, further scrutiny will be placed upon the underwriting process.
There are several proposed recommendations HUD is considering. These include 1) decreasing the amount of seller concessions from 6% to 3% and (2) possibly increasing the down payment amount to 5%. But until HUD issues a mortgagee letter (their method of communicating policy changes), these recommendations are simply suggestions. However, it’s important to inform your clients now of possible changes – and not risk the potential of them having to pay a larger down payment and lose seller concessions.
With FHA loans increasing from 3% of the mortgage market in 2006 to more than 40% of the market today, it is important this program remains strong. The recommendations and changes detailed above look to strengthen FHA overall, so it will remain a great option for borrowers in the future.
Most of you have probably heard about the upcoming changes being recommended by FHA. On January 21, HUD announced an increase in the upfront Mortgage Insurance Premium (MIP) from the current 1.75% to 2.25%. On a $100,000 loan, the upfront MIP will increase from $1,750 to $2,250. Using an interest rate of 5.0%, the monthly P&I would increase from $546.22 to $548.90, a difference of just $2.68.
Changes will be effective with case numbers issued by HUD on or after April 5, 2010. To help manage your clients’ expectations, please remember that case numbers are issued only upon receipt of a completed application by the lender. The cost to buyers is nominal, and more importantly, the MIP can be financed in the mortgage amount so it does not affect cash out of pocket. Because HUD is “self-funded,” these premiums provide income for HUD to maintain reserve requirements.
Also outlined as part of the new requirements are increasing audits for lenders that have large delinquencies with FHA. This will enable HUD to revoke a lender’s ability to originate loans if results indicate unacceptable credit decisions. Simply put, further scrutiny will be placed upon the underwriting process.
There are several proposed recommendations HUD is considering. These include 1) decreasing the amount of seller concessions from 6% to 3% and (2) possibly increasing the down payment amount to 5%. But until HUD issues a mortgagee letter (their method of communicating policy changes), these recommendations are simply suggestions. However, it’s important to inform your clients now of possible changes – and not risk the potential of them having to pay a larger down payment and lose seller concessions.
With FHA loans increasing from 3% of the mortgage market in 2006 to more than 40% of the market today, it is important this program remains strong. The recommendations and changes detailed above look to strengthen FHA overall, so it will remain a great option for borrowers in the future.
Thursday, February 11, 2010
Tracking US Housing Market’s Rise, Fall & Rebound –USA Today
Source of Data: Moody’s Economy.com
Graphics by: Barbara Hansen, Julia Schmalz, and Juan Thomassie
This article includes fantastic interactive graphics showing trends for five key indicators of the national housing market. http://bit.ly/5NnUo0
The graphs extend the trend lines to 2013.
As an example, go to the national Median Existing House Price graph and slide along the bar along the yearly index until the point on the graphs shows 1st Qt. 2010. Write down the median price and again slide along the bar until the point on the graph stops at 2nd Qt. 2011. Write down this median price.
As I see the graph and information:
1. It shows the median price still has to hit bottom.
2. The Median Price in 1st Qt 2010 (NOW) and the 2nd Qt. 2011 is essentially the same.
If you or someone you know is in the market to buy a home, why would you try to predict the bottom of the market? Remember these graphs are predictions extending into the future and illustrating national trends. These graphs DO NOT reflect your local market which must be analyzed and assessed for price trends. Your market may very well be trending up! Especially investigate the supply in your market. If the supply is dwindling, there will then be pressure on prices to trend up.
However, why would you wait? The Federal Tax Credit disappears in April 2010. Interest rates will start to trend up- see my previous post on interest rate predictions. A drop in the median price is really secondary to any increase in interest rates. The rates will determine how much you can afford to buy. The bottom line--- the Federal Tax Credit, either $8,000 or $6,500 is only available until the end of April. Interest rates are slowly moving up. NOW is the time to buy. Please copy this post and forward this analysis to your sphere of influence. Help your friends and family members take advantage of this unprecedented period of time in housing: low interest rates, over supply, lower house prices, and the government wants to give you money!
Will any of these factors change in May 2010 ---- you bet!!!!
Graphics by: Barbara Hansen, Julia Schmalz, and Juan Thomassie
This article includes fantastic interactive graphics showing trends for five key indicators of the national housing market. http://bit.ly/5NnUo0
The graphs extend the trend lines to 2013.
As an example, go to the national Median Existing House Price graph and slide along the bar along the yearly index until the point on the graphs shows 1st Qt. 2010. Write down the median price and again slide along the bar until the point on the graph stops at 2nd Qt. 2011. Write down this median price.
As I see the graph and information:
1. It shows the median price still has to hit bottom.
2. The Median Price in 1st Qt 2010 (NOW) and the 2nd Qt. 2011 is essentially the same.
If you or someone you know is in the market to buy a home, why would you try to predict the bottom of the market? Remember these graphs are predictions extending into the future and illustrating national trends. These graphs DO NOT reflect your local market which must be analyzed and assessed for price trends. Your market may very well be trending up! Especially investigate the supply in your market. If the supply is dwindling, there will then be pressure on prices to trend up.
However, why would you wait? The Federal Tax Credit disappears in April 2010. Interest rates will start to trend up- see my previous post on interest rate predictions. A drop in the median price is really secondary to any increase in interest rates. The rates will determine how much you can afford to buy. The bottom line--- the Federal Tax Credit, either $8,000 or $6,500 is only available until the end of April. Interest rates are slowly moving up. NOW is the time to buy. Please copy this post and forward this analysis to your sphere of influence. Help your friends and family members take advantage of this unprecedented period of time in housing: low interest rates, over supply, lower house prices, and the government wants to give you money!
Will any of these factors change in May 2010 ---- you bet!!!!
Wednesday, February 10, 2010
Projects Designed to Sell Your Home
Costs Recouped for Remodeling: A cost data report prepared by HomeTech Information Systems (www.hometechonline.com) was published in the January issue of Realtor®. This spreadsheet shows the contractor costs and estimated resale values for specific improvement projects. A certain percentage of the costs incurred are recouped through the sale of the home. The job cost, resale value and percent of costs recouped vary from region to region. Please let me know if you should have a specific location and I will provide the data from this valuable information guide.
Listed below are common remodeling projects which result in the highest percentage of costs recouped. These figures represent national averages and based on experienced industry professionals. What is important is the type of project which yields the highest percentage of costs recouped from the sale of the home.
Remodeling Project Job Cost Resale Value % Cost Recouped
Steel Entry Door $1,172 $1,470 128.9%
Fiber Cement Siding $13,287 $11,112 83.6%
Attic Bedroom-Addition $49,346 $40,992 83.1%
Wood Deck $10,634 $8,573 80.6%
Vinyl Siding $10,607 $8,476 79.9%
Minor Kitchen Upgrade $21,411 $16,773 78.3%
Some other common projects resulting in a lower percentage of the costs recouped:
Sunroom addition – 50.7% of the costs are recouped
Remodeled Bathroom – 71% of the costs are recouped
Roof Replacement - 66.6% of the costs are recouped
Windows Replaced – 76.6% of the costs are recouped
Listed below are common remodeling projects which result in the highest percentage of costs recouped. These figures represent national averages and based on experienced industry professionals. What is important is the type of project which yields the highest percentage of costs recouped from the sale of the home.
Remodeling Project Job Cost Resale Value % Cost Recouped
Steel Entry Door $1,172 $1,470 128.9%
Fiber Cement Siding $13,287 $11,112 83.6%
Attic Bedroom-Addition $49,346 $40,992 83.1%
Wood Deck $10,634 $8,573 80.6%
Vinyl Siding $10,607 $8,476 79.9%
Minor Kitchen Upgrade $21,411 $16,773 78.3%
Some other common projects resulting in a lower percentage of the costs recouped:
Sunroom addition – 50.7% of the costs are recouped
Remodeled Bathroom – 71% of the costs are recouped
Roof Replacement - 66.6% of the costs are recouped
Windows Replaced – 76.6% of the costs are recouped
Tuesday, February 9, 2010
Due Diligence Report - Permitted and Conditional Uses
For each zoning classification, there are permitted and conditional uses defined by local government. As an example for a property zoned General Business, the following permitted and conditional uses guide the development pattern approved by local government.
PERMITTED USES
From the zoning regulations, determine the permitted uses for the property. Determine if any of the uses are consistent with your intended use for the property. Evaluate the adjacent property for consistency in development pattern and if this zoning is appropriate for the area. OR perhaps there is a higher and best use for the site.
As an example, for a General Business Use, the permitted uses would be outlined as follows:
1. All principal uses permitted in the Neighborhood Business Zone
2. Art, dance music or other similar instructional school
3. Auto parts store
4. Bowling alley
5. Commercial Office
6. Commercial Retail
7. Funeral Home
8. Garden Center
9. Professional Office
10. Shopping Centers
11. Vocation/Trade School
12. Combination of two (2) or more of the above permitted uses
13. Other uses similar to those listed above
CONDITIONAL USES
Many zoning ordinances include other uses which can be developed on the property but must not contain any variances and be approved. An example of conditional uses for a General Business Zone are:
1. Automobile repair shop
2. Automobile sales establishment for new or used cars
3. Automobile service station (gas station or motor vehicle service station)
4. Car Wash
5. Churches and places of worship
6. Commercial recreation activities
7. Health Care facility
8. Hotel or motel
9. Mini-storage facility
10. Public utilities
11. Veterinary clinic hospital or animal care facility
The above example is from an ordinance which hasn’t been updated in years. In the future, mixed uses will be the only way to develop sustainable projects. Both vertical integrated mixed use buildings and horizontal mixed uses will provide market flexibility and diversification to reduce risks. These types of projects will however necessitate new partnering roles and reinventing business models within the real estate development industry. Remember a sustainable project achieves economic, social and environmental objectives. A project, product or building labeled “green” may not be considered sustainable! Ask for a copy of my white papers on the Future of Land Development (3-parts) for additional insight.
PERMITTED USES
From the zoning regulations, determine the permitted uses for the property. Determine if any of the uses are consistent with your intended use for the property. Evaluate the adjacent property for consistency in development pattern and if this zoning is appropriate for the area. OR perhaps there is a higher and best use for the site.
As an example, for a General Business Use, the permitted uses would be outlined as follows:
1. All principal uses permitted in the Neighborhood Business Zone
2. Art, dance music or other similar instructional school
3. Auto parts store
4. Bowling alley
5. Commercial Office
6. Commercial Retail
7. Funeral Home
8. Garden Center
9. Professional Office
10. Shopping Centers
11. Vocation/Trade School
12. Combination of two (2) or more of the above permitted uses
13. Other uses similar to those listed above
CONDITIONAL USES
Many zoning ordinances include other uses which can be developed on the property but must not contain any variances and be approved. An example of conditional uses for a General Business Zone are:
1. Automobile repair shop
2. Automobile sales establishment for new or used cars
3. Automobile service station (gas station or motor vehicle service station)
4. Car Wash
5. Churches and places of worship
6. Commercial recreation activities
7. Health Care facility
8. Hotel or motel
9. Mini-storage facility
10. Public utilities
11. Veterinary clinic hospital or animal care facility
The above example is from an ordinance which hasn’t been updated in years. In the future, mixed uses will be the only way to develop sustainable projects. Both vertical integrated mixed use buildings and horizontal mixed uses will provide market flexibility and diversification to reduce risks. These types of projects will however necessitate new partnering roles and reinventing business models within the real estate development industry. Remember a sustainable project achieves economic, social and environmental objectives. A project, product or building labeled “green” may not be considered sustainable! Ask for a copy of my white papers on the Future of Land Development (3-parts) for additional insight.
Monday, February 8, 2010
Due Diligence Report - ZONING
Definition provided by StateLawyers.com
Zoning regulations and restrictions are used by municipalities to control and direct the development of property within their borders.
Definition provided by QandA.encyclopedia.com
The separation or division of a municipality into districts, the regulation of buildings and structures in such districts in accordance with their construction and the nature and extent of their use, and the dedication of such districts to particular uses designed to serve the general welfare.
Definition by James Kimmons, About.com guide
Zoning is a legal method for municipalities to control the use of real property in certain specified areas. A zone is created and only certain types of property, or certain uses of properties, are allowed in the zone.
There are over 40,000 local municipalities in the US with their own unique approach to controlling how land is used. Most all will have an updated zoning map outlining the specific zoning classification for each parcel of land within its boundary. Remember, review the zoning map for inaccurate representations of actual development patterns and focus on properties a zoning change would add value and be justified for local politicians to accept.
In the previous section, a land use plan may designate a specific area to be a Residential Use. Within the broad land use of residential, the zoning would be, as an example, single family detached homes on lots with a minimum of 10,000 square feet. In this example, the specific bulk requirements governing the development pattern of each lot would be defined in the zoning ordinance. Each municipality will have its own zoning classification or label for each specific zone and the bulk requirements may differ.
How much does residential zoned acreage sell for in your area? (before the recession & currently)
How much does commercial zoned property sell for per acre?
How much does it cost to rezone the property from residential to commercial?
What is the time frame to accomplish the rezoning?
Does it make sense from planning, marketing, and financial perspectives to change the zone?
Go to your local planning office or go online and study the zoning map for background knowledge and understanding of the local development patterns. In the future, zoning may become a much more important tool for local government in to controlling development patterns within their boundaries. Please go to my blog post dated September 8th about this topic.
Zoning regulations and restrictions are used by municipalities to control and direct the development of property within their borders.
Definition provided by QandA.encyclopedia.com
The separation or division of a municipality into districts, the regulation of buildings and structures in such districts in accordance with their construction and the nature and extent of their use, and the dedication of such districts to particular uses designed to serve the general welfare.
Definition by James Kimmons, About.com guide
Zoning is a legal method for municipalities to control the use of real property in certain specified areas. A zone is created and only certain types of property, or certain uses of properties, are allowed in the zone.
There are over 40,000 local municipalities in the US with their own unique approach to controlling how land is used. Most all will have an updated zoning map outlining the specific zoning classification for each parcel of land within its boundary. Remember, review the zoning map for inaccurate representations of actual development patterns and focus on properties a zoning change would add value and be justified for local politicians to accept.
In the previous section, a land use plan may designate a specific area to be a Residential Use. Within the broad land use of residential, the zoning would be, as an example, single family detached homes on lots with a minimum of 10,000 square feet. In this example, the specific bulk requirements governing the development pattern of each lot would be defined in the zoning ordinance. Each municipality will have its own zoning classification or label for each specific zone and the bulk requirements may differ.
As an example to illustrate rezoning for value, answer these questions:
How much does residential zoned acreage sell for in your area? (before the recession & currently)
How much does commercial zoned property sell for per acre?
How much does it cost to rezone the property from residential to commercial?
What is the time frame to accomplish the rezoning?
Does it make sense from planning, marketing, and financial perspectives to change the zone?
Go to your local planning office or go online and study the zoning map for background knowledge and understanding of the local development patterns. In the future, zoning may become a much more important tool for local government in to controlling development patterns within their boundaries. Please go to my blog post dated September 8th about this topic.
Saturday, February 6, 2010
Know What the Experts are Predicting for Interest Rates in 2010
Source: The KCM Quick Report, February 2010
"If we look past just the price of a home, we know that the buyer will be concerned with its overall cost. We then realize how important the financing component is to the purchase.
Where are interest rates headed in 2010? Here is what people in the know are predicting:
HSH & Associates: rates will nudge closer to 6% than 5%
Moody's Economy.com: 6 percent that sounds about right
Washington Post: 6 percent by the end of 2010
Barry Habib of Mortgage Market Guide: It could be as high as 6.5%
Morgan Stanley: 7.5 percent to 8 percent"
How Interest Rates Affect Your Mortgage Payment
Article by Steve Harney, January 14, 2010
http://bit.ly/8PYAi6
Investigate your market for: # of homes on the market, days on the market, price adjustments over the past year, sale price to list price ratio, Federal Tax Credit for first time buyers and ALSO for repeat buyers. If you are thinking about buying or know of someone that may buy, send this blog post to them for their consideration. In my opinion, it is time to get off the fence!
"If we look past just the price of a home, we know that the buyer will be concerned with its overall cost. We then realize how important the financing component is to the purchase.
Where are interest rates headed in 2010? Here is what people in the know are predicting:
HSH & Associates: rates will nudge closer to 6% than 5%
Moody's Economy.com: 6 percent that sounds about right
Washington Post: 6 percent by the end of 2010
Barry Habib of Mortgage Market Guide: It could be as high as 6.5%
Morgan Stanley: 7.5 percent to 8 percent"
How Interest Rates Affect Your Mortgage Payment
Article by Steve Harney, January 14, 2010
http://bit.ly/8PYAi6
Investigate your market for: # of homes on the market, days on the market, price adjustments over the past year, sale price to list price ratio, Federal Tax Credit for first time buyers and ALSO for repeat buyers. If you are thinking about buying or know of someone that may buy, send this blog post to them for their consideration. In my opinion, it is time to get off the fence!
Thursday, February 4, 2010
Due Diligence Report – Zoning & Land Use
The due diligence report has a separate section on zoning and land use. Both of which will have a bearing on the ability to seek the highest and best use for a site. Most all jurisdictions will have a Land Use Plan and Zoning Districts. This section will explore these elements requiring an in-depth investigation to ensure the intended use and design for the property is in compliance with local regulations. Not only checking existing regulations but inquire about any changes in the political pipeline. If the intended use for the property is inconsistent with the municipal land use and zoning plans, a request to change the documents will be required. Consider:
Diversification of land uses will increase absorption
Seek various densities to achieve a balance between density, marketability and cost
Consider various ownership i.e. rental, fee simple and condominium
Research your market to seek highest and best uses or market driven uses
Remember, just because a property has a specific zoning or land use as designated by government, the use/zoning may not represent the development pattern of the immediate area. Local government has just not updated their land use and zoning maps to reflect the actual changes in the marketplace. Consider the following land uses for your site:
Rural residential, estate or standard single family detached
Small Lot single family and Zero lot line
Duplexes and Townhouses
4, 6, & 8-plexes
Mid-Rise and High Density
Residential, Commercial, or Office Mixed Use
Vertical Integrated Mixed Use
Town Center
Neighborhood or High Intensity commercial
Traditional Neighborhood, New Urbanism
Industrial or office Parks
Recreation Areas, flood Plains, and wetlands
Golf Courses and other amenities
Public, Quasi-Public and community facilities
Active Adult Communities
Transitional communities
Specialized Adult Housing i.e. Assisted Living, Independent Living
Wednesday, February 3, 2010
Yearend Unemployment Figures
The link will take you to an article by G. Scott Thomas 2/2/10 of the Business First of Buffalo. He summarizes the yearend employment figures published by the US Bureau of Labor Statistics. He states that 99 of the top 100 job markets in the US lost jobs during 2009. For 2010, look at the specifics of your market and try not to focus on the national problems. Determine the stable or growing industries and focus on how your business can hang onto their coat tails!
http://bit.ly/bBexKJ
In his article, he included a link to a search box for finding the unemployment rates and information for over 400 specific cities and smaller markets. Remember to look for trends in your market. There are some interesting stats which should be repeated here:
The highest is Fresno, CA at 16.8% unemployment rate.
The lowest unemployment rate is in Omaha, NE at 5.0%
Refer to the housing chart for Las Vegas in my post this week and make your own conclusion:
Las Vegas unemployment
at the end of 2008 was 8.7%
at the end of 2009 was 13.1%
Charlotte at 12.1% and Raleigh at 8.7% - Is this banking versus government job markets?
Last statistic: There were five markets which lost over 100,000 jobs during 2009: Chicago, Los Angeles, New York, Detroit, and Atlanta.
http://bit.ly/bBexKJ
In his article, he included a link to a search box for finding the unemployment rates and information for over 400 specific cities and smaller markets. Remember to look for trends in your market. There are some interesting stats which should be repeated here:
The highest is Fresno, CA at 16.8% unemployment rate.
The lowest unemployment rate is in Omaha, NE at 5.0%
Refer to the housing chart for Las Vegas in my post this week and make your own conclusion:
Las Vegas unemployment
at the end of 2008 was 8.7%
at the end of 2009 was 13.1%
Charlotte at 12.1% and Raleigh at 8.7% - Is this banking versus government job markets?
Last statistic: There were five markets which lost over 100,000 jobs during 2009: Chicago, Los Angeles, New York, Detroit, and Atlanta.
Tuesday, February 2, 2010
32 Ways to use Facebook for Business
http://bit.ly/9cdWNB Posted by Lacie Moore January 31, 2010
In previous posts, we have discussed the use of Twitter and LinkedIn for professional and business development strategies. This article outlines how to use Facebook as an effective business tool.
My suggestions:
Link your social media networking sites together
Start a blog
Contribute to your sites on a regular basis
Be engaged and actively participate in other groups
Increase the online distribution of your ideas
What is next on the internet? I have always been told to stay on top of technological change. Today and tomorrow our business practices will change because of technological innovation. Unlike yesteryear, I will embrace change and ride the tidal wave of ideas and “think outside of the box” in its use.
In previous posts, we have discussed the use of Twitter and LinkedIn for professional and business development strategies. This article outlines how to use Facebook as an effective business tool.
My suggestions:
Link your social media networking sites together
Start a blog
Contribute to your sites on a regular basis
Be engaged and actively participate in other groups
Increase the online distribution of your ideas
What is next on the internet? I have always been told to stay on top of technological change. Today and tomorrow our business practices will change because of technological innovation. Unlike yesteryear, I will embrace change and ride the tidal wave of ideas and “think outside of the box” in its use.
Monday, February 1, 2010
Housing Market Charts
January 27, 2010, Business Insider
"Is Your City STILL in the Housing Market Gutter?"
By Kamelia Angelova
http://bit.ly/9jQcR4
I have included three graphs showing the good (not so bad), middle of the road (could be worse) and really bad housing markets for your comparison. There are over 40,000 local municipalities in the United States and each has its own market characteristics. The metro areas are just indicative of a region and not all housing markets have tanked. If you should know of any local housing markets with recent data showing a positive gain over the past year, please post your information.
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