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Louisville Real Estate as Investment

Nov 29, 2009 News

As we near year’s end, thoughts of planning fill many minds here in Louisville. How did we do this year? Will next year be better or worse? How should we change our financial plan?

Chris Otts had a piece in the CJ yesterday titled Time to rethink finances? He brings up the idea that gold isn’t the only way to hedge investments against the stock market.

Planners say clients have been asking about investing in gold because of fears about inflation, given the government’s unprecedented borrowing to intervene in financial markets.

“Gold is simply a fear investment at this point,” Gilliam said. “We caution our clients not to get too caught up.”

Jones, of PNC, said there are better inflation hedges than gold, such as Inflation-Protected Securities sold by the U.S. Treasury, real estate and corporate bonds — though gold could be part of a broad mix of investments.

I think the important point to note is that real estate can be a great investment but it can also be a terrible one. Having sound advice is key. The best thing you can do is find yourself a trusted Louisville Realtor, whether he be a residential or commercial specialist, before you consider purchasing any piece of real estate.

Tags: Chris Otts

Building Homes from Trash

Nov 26, 2009 News

Not necessarily Louisville real estate, but it’s great to see Dan Phillips take discarded materials and building useful homes.

Tags: Dan Phillips

Louisville Homes Sales Up, Thanks to Tax Credit

Nov 24, 2009 Trends/Statistics

Saw this article in the CJ citing the reason for the increased number of Louisville home sales in October.

First-time buyers taking advantage of a special tax credit gave sales of existing homes their biggest surge in a decade, raising hopes for a turnaround in the housing market and pleasing Wall Street.

Looking specifically at Louisville the increase was substantial.

The Greater Louisville Association of Realtors recently reported that its members sold 1,210 homes in October, a 26 percent increase over a year earlier. The median price for homes sold by GLAR members was $133,500, also an increase from October 2008.

Critics say that these buyers were planning on buying anyway just not this early. Now that the tax credit has been extended, it’ll be interesting to see how sales move going into 2010.

Tags: Louisville Home Sales

A Resource for Louisville Real Estate Investors

Nov 20, 2009 News

A month or two ago a gentleman asked if I was available for an interview. He wrote for Personal Real Estate Investor and was working on an article about real estate investing here in Louisville, KY.

At first, I didn’t know if I should accept. For starters, I’m not personally a real estate investor and secondly, the vast majority of my clients aren’t either. In the end, I decided to answer his questions to the best of my ability and leave the writing up to them.

I received my copy of the magazine the other day and was please how it turned out. For Louisville real estate investors, the current issue would be a smart investment. Who knows? Maybe you’ll like it so much that you’ll become a subscriber?

Tags: Personal Real Estate Investor, Scott Seckel

Best Louisville Neighborhoods: Forest Springs & Forest Springs North

Nov 16, 2009 Neighborhoods

Forest Springs (along with Forest Springs North) is a great neighborhood in Louisville’s east end off LaGrange Road just outside of the Gene Snyder Expressway, near Rock Springs, Woodmont and Fox Run. Homes here are reasonably priced while still being part of a great community with tennis courts, pool and clubhouse. This subdivision has some beautiful homes and is located in a great part of town where a lot of new development is taking place. Read More »

Tags: best louisville neighborhoods, Forest Springs, Forest Springs North, louisville ky

10 DIY Cheap and Easy Ways to Protect Your Home

Nov 12, 2009 Home Improvement

According to the FBI, a house, apartment, or condominium is burglarized once every 15 seconds. This results in thousands per hour and untold millions in stolen goods, not to mention the rise in insurance premiums. Don’t be part of the statistics by following these top ten DIY cheap and easy ways to protect your home.

DIY Cheap and Easy Ways to Protect Your Doors

According to a study by the California Crime Technological Research Foundation, the most common ways burglars use to break into homes involve doors. Use the below for inexpensive and simple ways to strengthen them.

1. Replace Locks: Unless you are the first owner, chances are the keys to your home are still out there. Old and outdated locks are also another good reason to replace. State Farm recommends an ANSI Grade 1 lock, the more pins, the better. Be sure to address all entry doors. All you need to install them is a screwdriver.

2. New Strike Plates: Because most strike plates come with holes for two screws, they are easier to break into. Try finding a strike plate that has four holes for screws, making it twice as hard to kick down or pry open. Whether upgrading to four screws or staying with two, be sure to use wood screws that are a minimum of two inches in length.

3. Upgraded Door Hinges: If any of your entry doors swings outward, a burglar may be able to enter your home by simply removing the pins from your door hinges. Don’t tear your hair out over replacing the entire door and frame just yet, there are cheap and easy DIY options. Try getting a hinge with non-removable or fast-riveted pins or even a safety stud.

Low Tech DIY Cheap and Easy Ways to Protect Your Home

You don’t have to be computer or hardware savvy to utilize the below ways to protect your home.

4. Neighborhood Watch: Because if the whole neighborhood is watching, it will be like your home is never empty. USA On Watch can help you find one in your city or help you start your own. You can also visit National Neighborhood Watch Institute for supplies, handbooks, decals, and more.

5. Alarm Decal or Sticker: Use these decals, stickers, and signs to let criminals know your home is protected by an alarm system or camera, even if it is not. This online store sells a variety of impress security signs and can even customize them. If you prefer a more authentic one, contact the security provider of your choice to purchase your decal directly from them.

6. Lock the doors and windows! The most common ways burglars enter into homes, it happens more than you think. Many of these criminals will even enter an unlocked home if there are people inside. Still have a hard time remembering? Then read this story to remind yourself why.

High Tech DIY Cheap and Easy Ways to Protect Your Home

Although some tech is required, by no means is a doctorate in science needed to follow these higher tech ways to protect your home.

7. Light It! Because criminals like to work in the dark, nothing stops them in their tracks light a security light. Whether security or motion detecting, these lights are easy to install, even if you don’t have any experience. This article on eHow gives detailed instructions on how to install security lighting and even offers related videos.

8. Use That PC Camera: Follow the instructions on this site to turn your PC web camera into a motion detection and recording security camera. You only need a PC (Mac instructions coming soon), web camera, and Dorgem. There are even advanced options and a how-to on working with multiple cameras.

9. DIY Home Alarm: Install yourself and customize yourself to protect your home cheaply and easily. You don’t need a monitoring service for the alarm to go off when a door is opened or window is broken. In addition, criminals won’t know if the alarm is hooked up and neighbors who hear it are likely to phone for help. UDoItAlarms sells a variety of DIY home security products and even has how-to videos.

10. A Real Home Alarm: Competitively priced for installation and surveillance, many security systems can actually give you a break on your home owner’s insurance. This site has a beginner’s guide to home security, explanations on common security devices, and even a Just For Fun section. Be sure to check out the Review tab for reports on security providers such as Brinks and Protection One before purchasing.

Although break-ins can be scary, they are one of the most preventable of crimes. Even though nothing is guaranteed, you are far less likely to become a victim after doing all of these top ten DIY cheap and easy ways to protect your home.

Tags: Adrienne Carlson, Brinks, California Crime Technological Research Foundation, National Neighborhood Watch Institute, Protection One, UDoItAlarms

Geothermal Explained for Your Louisville Home

Nov 12, 2009 Home Improvement

The movement of homeowners to “go green” by utilizing geothermal heating and cooling is becoming ever more common. However, there is still a large part of the population who doesn’t even know where to begin when it comes to tackling the concept of geothermal. So let’s lay some ground work, peel back the layers of this 21st century question of “To go Geo or not to go Geo?” and see if it is right for your Louisville home.

How does a geothermal system work?

Outdoor temperatures fluctuate with the seasons. However, the underground temperatures remain more consistent. About four to six feet below the earth’s surface, temperature remains relatively moderate and constant year-round.

In winter, fluid circulating through the geothermal system’s earth loop absorbs stored heat and carries it to the home. The indoor unit compresses the heat to a higher temperature and distributes it throughout the home. In summer, the geothermal system reverses, pulling heat from the home, depositing it in the cooler earth. A geothermal system uses the energy from the sun, which is stored in the earth, to heat and cool homes.

Typically, electric power is used only to operate the unit’s fan, compressor, and pump. These systems simply transfer heat to and from the earth. If you are a tech guy or girl, check out the WaterFurnace website, which contains great information on how geothermal systems work, various loop systems for geothermal and equipment specifications.

OK, Mr. Geothermal, what makes you so “green”?

Installing a single geothermal unit in your home or business is the environmental equivalent of planting 750 trees or removing two cars from the road. Geothermal heat pumps produce no emissions which means that they do not pollute the atmosphere. The U.S. General Accounting Office estimates that if geothermal systems were installed nationwide, Americans could save several billion dollars annually in energy costs and substantially reduce pollution.

By reducing the demand placed on electric utilities, geothermal systems reduce the need for new power plants. The systems minimize the threats of acid rain, air pollution, the greenhouse effect and other environmental problems that are directly linked to burning fossil fuel. Since geothermal systems are recognized by the Environmental Protection Agency (EPA) as the most environmentally friendly heating and cooling technology available, it’s a system you can feel good about using.

Your own backyard has the potential to be your source of heating and cooling comfort. You can get safe, reliable, energy efficient heating and cooling from one piece of equipment. Geothermal energy represents the leading edge of heating and cooling technology. It moves heat energy to and from the earth to heat and cool your indoor environment. Geothermal is the safest, cleanest, most reliable space conditioning system you can invest in.

Does my house qualify for geothermal?

Geothermal systems can be installed in new construction homes, as well as, existing homes. Existing home applications are typically referred to as “retro-fit” designs. A home’s design does not dictate if geothermal can be installed, only access to the lot for drilling can put the brakes on a geothermal project.

Some would think that it would be impossible to drill through solid rock. However, it is actually one of the best heat transfer mediums for geothermal. In the Louisville, Kentucky area you will usually see solid rock at about 15 feet. The ground may contain solid rock, clay or sand. All of these ground materials can be drilled, provided you have access to bring in the drilling rig.

A smaller home will see a longer period of time before the initial investment would be returned. However there is not a 1:1 ratio for home size to payoff. The return time is dependent upon many variables some of which include insulation, the homeowner’s comfort settings and the geothermal system installed.

What is the difference between a traditional system and geothermal?

Because geothermal systems use the energy found beneath the earth’s surface, they cost less to operate, up to 60% cost savings and generally last twice as long as a conventional units. Also, unlike the conventional systems, geothermal does not emit dangerous gases or fumes of any type.

Yeah it sounds good but how much does it cost?

Geothermal typically costs about 2-3 times higher than a traditional high end heating and cooling system. What that means is that you’re looking at an investment of $14,000 and up. A large part of the system’s cost is related to the initial drilling, so that the earth loops can be placed in the ground.

Like everything, a geothermal system does come with several upgrade options, one of which is the “de-super heater” option. This option allows the homeowner to divert excess heat produced during the heating and cooling process. The heat is then used to heat hot water for domestic hot water usage, resulting in “free hot water.”

The federal government is currently offering a 30% uncapped federal tax credit for installing a geothermal system. The 30% credit is based on the total installation cost of the system in your Louisville home. The current regulation states that you have until 2016 to take the federal tax credit. However, it is best to seek the advice your tax professional for the specifics on your personal situation.

With geothermal being up to 500% efficient, you will get $5 for ever $1 spent in energy. What this means is homeowners can see their initial investment returned in as little as 4 years, which opens the door for significant savings in the long term.

Let’s look at an example

A typical home in Louisville measuring 3,000 sq. ft. could see an average monthly heating, cooling and domestic hot water heating bill of $71.00 a month! For a this situation, the estimated R.O.I. would be 5.7 years.

Not that there are many people living in a home this large, but a 10,000 sq. ft. Louisville home could see an average monthly heating, cooling and domestic hot water heating bill of $157.00 a month! This R.O.I. is lowered to 4.8 years.

Louisville Homeowners interested in seeing geothermal costs and benefits for their own home can visit this online geothermal savings calculator.

Tags: Allgeier Air, Environmental Protection Agency, Geothermal, Geothermal Heat Pump Consortium, Jay Welker, louisville ky, U.S. General Accounting Office, U.S. Green Building Council, WaterFurnace

Home Buyer Tax Credit Changes

Nov 9, 2009 Residential

Now that it’s law, I thought this information deserved its own post. If you have any questions about how this might apply to buying your next Louisville home, please don’t hesitate to contact me.

Tags: Home Buyer Tax Credit Changes

Senate Passes Extension for Tax Credit, Up to House Next

Nov 5, 2009 News

News out of Washington:

First-time homebuyers have been getting tax credits of up to $8,000 since January as part of the economic stimulus package. But with that program scheduled to expire at the end of November, the Senate voted 98-0 Wednesday to extend and expand the tax credit to include buyers who already own homes. The House is expected to vote on the bill Thursday. [link]

If this passes the House, then all American have the opportunity to get tax credits in 2010.

The real estate industry has been pushing to extend and expand the housing tax credit. About 1.4 million first-time homebuyers have qualified for the credit through August. The National Association of Realtors estimates that 350,000 of them would not have purchased their homes without the credit.

Update: House passes the bill 430-12. Here’s a rundown of the Home Buyer Tax Credit Changes.

Tags: tax credit

Louisville Bedroom Defined

Nov 4, 2009 Residential

There is a lot of confusion about what constitutes a bedroom in real estate. There are many opinions and even proper definitions. Let’s tackle them one at a time.

Building Codes

Every principality has official building codes. These codes go into great detail and are what inspectors use to verify certification. This is especially important for new construction as the home occupancy certification is needed before the home buyers can legally move in.

In all cases, the local building codes are the most authoritative answer as to what constitutes an official bedroom. The following is the official Louisville Occupancy Limitations (156.103) for what constitutes a bedroom excerpted from Property Maintenance Code Chapter 156.

D. Bedroom requirements. Every bedroom shall comply with the following requirements:

1. Area for sleeping. Every bedroom occupied by one person shall contain at least 70 square feet (6.5 mm) of floor area, and every bedroom occupied by more than one person shall contain at least 50 square feet (4.6 mm) of floor area for each occupant thereof.
2. Access from bedrooms. Bedrooms shall not constitute the only means of access to other bedrooms or habitable spaces and shall not-serve as the only means of egress from other habitable spaces except in units that contain fewer than two bedrooms.
3. Water closet accessibility. Every bedroom shall have access to at least one water closet and one lavatory without passing through another bedroom. Every bedroom in a dwelling unit shall have access to at least one water closet and lavatory located in the same story as the bedroom or an adjacent story.
4. Prohibited occupancy. No person shall use any kitchen, nonhabitable or public space for sleeping purposes, nor shall food be prepared or cooked in any room used for sleeping purposes, except in an efficiency apartment. In an efficiency apartment, that portion of the room designated for sleeping purposes shall not be within ten feet of that portion of the room designated for cooking purposes. The ten feet shall be calculated as the shortest straight line distance between the sleeping area and the stove. The ten feet requirement shall not be a violation when the ten feet distance is separated by a permanent divider wall of a height of at least 50% of the height of the room.
5. Other requirements. Bedrooms shall comply with the applicable provisions of this chapter including, but not limited to, the light, ventilation, room area, ceiling height and room width requirements of this section, the plumbing facilities and water-heating facilities requirements of this chapter; the heating facilities and electrical receptacle requirements of this chapter; and the smoke detector and emergency escape requirements of this chapter.

In the area of bedroom requirements, the Federal government’s office of Housing and Urban Development (HUD) general defers to the local housing regulations.

Home Appraisers & Tax Appraisers

This group of real estate experts may also add to the list of what constitutes a bedroom. But they may not remove any of the local regulations.

Realtors® & Real Estate Agents

In real estate, to be counted as a bedroom it must be:

• A room with a door,
• that has it’s own closet, and
• a means of egress.

Examples of rooms that are often counted as bedrooms but really shouldn’t be are:

• A basement room where the window is too small for someone to escape through;
• A room without a closet but utilizes a piece of furniture for clothing;
• A room, other than a loft, that’s open to the rest of the home.

Hopefully, this has helped you better understand the quirky nature of bedroom definitions. If you need a more specific answer for your Louisville home, feel free to contact me any time.

Louisville KY Home Sales: October 2009

Nov 2, 2009 Trends/Statistics

In all but one of the Jefferson County areas home sales were up in October. That goes against seasonal trends where activity tapers off as we head into the Holidays. Average home sale prices were generally up as well, compared to September.

As always, if you have any questions, please don’t hesitate to contact me.

October 2009

AREA	SALES	AVERAGE	DoM
0 Central Downtown District	8	$201,431	85
1 Downtwn/Old&WestLouisville/Shively	79	$42,525	57
2 Butchertown/Highlands/Germantwn	84	$181,561	71
3 Brownsboro/StMatthews	74	$209,440	64
4 Pleasure Rdg/Valley Station	82	$106,503	82
5 Auburndale/Fairdale/Iroquois Park	84	$109,830	73
6 Buechel/Highview/Okolona/FernCreek	146	$123,125	83
7 FernCrk/Hikes Point/Jeffersontown	135	$155,343	62
8 Hurstbourne/Middletwn/Anchrg	95	$246,533	103
9 Anchrg/Lyndn/Prospct/UpRvrRd	106	$264,781	93
11 Bullitt Co.	70	$167,793	81
19 Spencer Co.	19	$148,361	166
20 Oldham Co. – North	30	$283,302	110
21 Oldham Co. – South	41	$243,695	80
30 Shelby Co.	39	$141,699	97

Source: MetroSearch, Inc. Values are not warranted by LHB.

Tags: home sales, louisville ky, October 2009