If you're buying a fixer upper that you'll live in, you might want to consider the FHA Section 203(k) loan program!

This program allows a buyer to finance their purchase and subsequent repairs into one loan.  The alternative is for a fixer-upper buyer to obtain a secondary or short-term loan to finance the repairs or improvements that they will make after settlement.

You can finance significantly more than the purchase price of the property in order to have cash on hand for repairs.  The funds for improvements are placed into an escrow account, and the buyer (now owner) can draw on them through the rehabilitation process to pay for the repairs and improvements.

There are a few basic guidelines that can quickly tell you whether this might work for your situation:

• This loan program is not for those purchasing investment properties.
• Single family homes, townhomes, all the way up to a fourplex are all acceptable properties.
• The improvements must meet HUD minimum property standards.
• The planned improvements must cost at least $5,000.
• The improvements must start within 30 days of settlement, cannot cease for 30 consecutive days, and must all be complete within six months of settlement.
• You, the buyer/borrower, can do the work yourself, though you can only be paid for the cost of materials.

Of note, the Streamline 203(k) might also be of interest -- it allows for up to an additional $35,000 to be financed for improvements prior to move-in.

I have had clients consider this program, who didn't end up buying a fixer upper.  Have you purchased a house in Harrisonburg (and surrounding) using this loan program?  Or do you know someone who has?  Please share!

If you are making any additions, improvements or repairs to your home you must pull a building permit, and if it involves electrical or plumbing work you'll also need to pull an electric permit and/or plumbing permit.

"But Why?" you might ask....

In the here and now, you need to pull the appropriate permits because that is what Harrisonburg and Rockingham County require of you.  Also in the here and now, pulling the permits will thus require inspections, which will go a long way towards assuring that the changes made to your house are safe, per their compliance with the Building Code.

In the future --- as in the time when you want to then sell your home --- it is arguably very important to have pulled building permits and to have passed the inspections.

In selling your home, you are required to disclose any material adverse facts about your home.  In my view, the fact that the basement was finished (or other improvements were made) without permits and inspections is a material adverse fact about the house.  It's not necessarily that the house is unsafe, but the fact that parts of the home were never inspected by the locality create that possibility.

Pull the permits.  Get the inspections!

Over the past few months I have been educating myself about green building techniques (for example: What Is An Earthcraft House?), but I have also been picking up some tips on what existing homeowners can do to make their homes more green, and energy efficient.

Here are some low-cost ways to live green around your home:

1. Install CFL lightbulbs (save lots of electricity)
   
2. Install low-flow showerheads (save water too)
   
3. Start a compost pile (save the landfills)
   
4. Plant trees (shade trees around a house can reduce heating bills)
5. Insulate hot water heater (avoid unnecessary energy/heat loss)
6. Weatherstrip and caulk doors and windows (seal those leaks)
7. Collect rainwater to water plants (save tap water for drinking)
8. Paint with low- or no-VOC paint (avoid those toxins)
9. Replace air filters (improve indoor air quality)
10. Install a programmable thermostat (don't heat an empty house)
11. Plant native plants (avoid the need to water heavily)

If you're willing to spend a bit more, here are some medium-cost ideas:

1. Conduct an energy audit (find the problems)
2. Tune up the HVAC system (efficient heating systems heat efficiently)
3. Install a tankless water heater (stop heating water endlessly)
4. Insulate attic and other areas (stop needless heat loss)

Do you have other ideas of how to live greener in your current home?  Please share!

I'll be posting even more information that I have learned from these Green Building courses over the next few weeks, but if you have specific questions before then, feel free to call (540-578-0102) or e-mail (scott@cbfunkhouser.com) me.

I am currently representing the buyers of a house that was pre-inspected before it came on the market.  That is to say that the homeowners engaged a home inspector to inspect their own home before they put their house on the market.  Then, going a step further, the homeowners made almost all of the repairs that the inspector suggested.

Good for the owner, good for the buyer...
Going through the inspection process and making repairs before any buyers even look at the house can be very helpful.  You can discover and address significant issues that might otherwise derail a transaction when a buyer conducts the home inspection.  In fact, my clients were quite relieved to see how many repairs the homeowners had made on the house they are purchasing.

Bad for the owner...
If you, as a homeowner, are not willing to make repairs as a result of the inspection, you might not want to pre-inspect your home.  Having the information, you would then need to disclose the adverse issues to buyers -- which would just focus their attention on what had previously been unknown to everyone.  It is likely the buyers would have conducted their own inspection anyhow, and thus would have discovered the items, but why bring up these adverse facts at the beginning of the process if you aren't willing to fix them.

Bad for the buyer...
If a homeowner pre-inspects their home, it is often the case that they will be reluctant to make any further repairs at the requst of a buyer.  Most homeowners in this situation decide that they have made all of the repairs which are reasonable for a buyer to request --- so if a buyer starts requesting other repairs...

Given the good and the bad...
I strongly recommend that sellers pre-inspect their home if they suspect there may be some needed repairs and if they are willing to spend the time and/or money to make the repairs. 

Are you trying to avoid the potential danger of a space heater?  Are you trying to heat a room or garage more efficiently than with a space heater?  Have you considered a ceiling fan?

The fan pictured above, the Reiker Room Condition, may be what you are looking for.  A heater is housed just above the fan blades, and the heat being generated is evenly distributed throughout a room. 

These sophisticated fans will cost between $270 and $400 depending on options and finishes, and can be ordered through the Reiker web site, or found at some Home Depot stores.

Be sure to stop by JMU's Convocation Center this coming weekend for the SVBA's 2008 Home & Garden Show.  The show hours include:

• Friday, April 4, 4p-9p
• Saturday, April 5, 10a-9p
• Sunday, April 6, 12p-5p

Tickets are $2.00 per person, with children under 12 and Scouts in uniform gaining free admission.  Coldwell Banker Funkhouser Realtors will have a booth on the lower level, highlighting our web site, the many new communities we represent, and some outstanding espresso beverages! 

Award-winning garden designer, author and owner of Rockcastle River Trading Company --- Jon Carloftis (pictured above, to the right) will join us this year at the 2008 SVBA Home & Garden Show.  Jon is a contributing editor of Garden Design magazine, and a regional writer for Country Gardens.  Jon will be appearing on Saturday, April 5 at 1:00 P.M. and 5:00 P.M. in Builders Square at JMU's Convocation Center.

Each year, Realtor Magazine partners with Remodeling Magazine to deliver a Remodeling Cost vs. Value Report which analyzes the average cost recouped for a variety of home improvement projects.  The bottom line of this year's report seems to be that the best place to invest your remodeling dollars is on exterior improvements.  However, the thing to notice first is that none of the projects are shown to return the total amount of money invested.  As a result, I recommend that my clients carefully consider engaging in these sorts of projects for re-sale purposes.  Unless you will experience some interim enjoyment from the upgrade, it is likely not worth investing the money in the project.

Here's an overview of the top percentage returns on projects in the South-Atlantic region --- which includes Virginia:

1. Siding Replacement (fiber-cement)  =  89.4%
2. Deck Addition - Wood  =  85.6%
3. Siding Replacement  =  85.1%
4. Minor Kitchen Remodel  =  82.7%
5. Siding Replacement (foam-backed vinyl)  =  82.2%
6. Window Replacement - Vinyl  =  81%

Click here for the full table of home improvement projects, costs, and values.

On the air yesterday, we had some questions about garages --- are most houses being built with them these days, are most buyers looking for them, etc.  Here are some numbers to answer those questions . . .

Garages have become a more frequent occurrence over time.
Looking at sales during the past 12 months in Harrisonburg and Rockingham County, here's what we get:

Year Built	# Homes	# w/ Garage	% w/ Garage
1990 - 2007	382	276	72%
1970 - 1990	205	78	38%

Of late, the larger the home being built, the more likely it will have a garage.
Looking at sales during the past 36 months, of homes built since 2000, in all of Harrisonburg and Rockingham County, here's what we get:

SF	# Homes	# w/ Garage	% w/ Garage
0 - 1999	407	238	58%
2000 +	419	368	88%

As reported today in the Daily News Record, the number of building permits has dropped by roughly 16% in Rockingham County. As Jenny Jones points out, this reflects what has been going on for the past year nationally --- both with building permits and the number of homes sold.

David Milstead, of Milstead Construction, also makes a great point that there are still plenty of buyers for mid-priced homes, but upper-end home buyers seem to have disappeared lately. One additional reason for this, is that many of our market's high end buyers were relocating or retiring from larger markets, selling high-priced homes in those markets, and buying high-priced homes in our market. With several of those markets slowing down, the rate of high end buyers entering our market from outside has certainly slowed in the last 12-18 months.

With every economic turn (for better or for worse), there exists an opportunity. The current opportunity is for hiring a contractor to do a home improvement project. Over the past few years, this was a tough task --- with the huge demand for new construction housing, it was difficult to find someone to build an addition, or a deck, or to remodel a kitchen, etc. All that has changed --- look in the classifieds section of the Daily News Record and you'll see many contractors and builders seeking customers both to build homes or do home improvement projects. There are lots of options, and I imagine you would be able to obtain multiple, competitive bids.