Boulder, CO

EcoBrokers® Help Home Sellers to Sell Faster and for More Money

In my last post, I examined some of the Home Buyer Benefits of working with an EcoBroker®. In today’s post I’ll highlight some of the benefits to home sellers of working with an EcoBroker®.

First, a brief recap of what is an EcoBroker®. A Certified EcoBroker® is a real estate professional that has received specialized training in energy efficiency along with many of the important environmental issues related to healthier homes. An EcoBroker® can assist anyone seeking to purchase or sell a home to evaluate the home’s performance. EcoBrokers can help home buyers and sellers by promoting healthier, cost-effective and green practices in real estate.

Health and environmental awareness are now influencing home buying decisions motivating buyers to seek out green homes. When asked to list their top 12 influences in buying a home, consumers responding to a National Association of Home Builders (NAHB) survey last year put energy efficiency at No. 2, behind quality of living space.

Green home building and related products are gaining ground according to a report produced jointly by McGraw-Hill Construction and the NAHB. The report showed that the market for green homes and buildings is expected to rise from $49 billion to $140 billion over the next five years. Standard homes are becoming increasingly green, with home owners using green products for 40 percent of their remodeling work.

With the number of home buyers seeking green homes growing every day, it is important for sellers to work with a real estate professional trained to market the green features and benefits of their home.

Benefits for a Home Seller Working with an EcoBroker®:

EcoBrokers can help sell green homes faster and for more money. Their specialized training enables them to highlight the special benefits of a green home and to capitalize on the increased market value. The distinguishing features and benefits of green homes can help them sell faster compared to other similar homes that are not green.

EcoBrokers can market the benefits of a green home. They are trained to market cost-effective, environmentally favorable and healthier benefits of green homes. Leading surveys have shown that buyers are motivated by the healthier standards and lower operating costs of energy-efficient green homes. The EcoBroker's ability to market a home's green value proposition is a strong advantage for sellers.

EcoBrokers know how to communicate green benefits to home buyers. EcoBrokers are knowledgeable professionals about home related environmental technology. And because they are ‘tech-savy’ they can speak the language of green home features and benefits enabling them to communicate effectively to home buyers.

EcoBrokers can assist sellers even if the home was not built green. They can advise sellers how to cost-effectively give their home a green ‘tune-up’ for resale. EcoBrokers can help sellers turn typical pre-sale upgrades into marketable, cost-saving and health benefits to buyers. Sellers are able to obtain top dollar for the added green quality and value of their home.

In brief, a home seller working with an EcoBroker® is empowered to enjoy the maximum economic value of their green featured home.

If you or someone you know are planning to buy or sell a home, consider working with a Certified EcoBroker®. You can obtain information about EcoBrokers in your area at the website for EcoBroker International.

If you are planning to buy or sell a home in Denver Metro or Boulder County areas of Colorado, I would be happy to assist you.

Visit my website at E3GreenHOMES.com for more information about buying or selling Colorado green homes.

John Thomas MSEE, MBA

(m) 720-771-5594

(e) john.thomas@e3greenhomes.com

EcoBrokers Help Buyers Make Better and More Informed Home Buying Decisions

Energy-Efficient, Eco-friendly real estate is a rapidly growing trend in today’s market. More and more home buyers are seeking to buy green homes because they are concerned about the health of their families, as well as to reduce energy and other home operating costs. Home buyers are also seeking to make more environmentally responsible buying decisions.

A real estate agent with a EcoBroker Certified® designation has received specialized training in energy efficiency in addition to a wide variety of environmental issues related to healthier homes. An EcoBroker® is trained to assist buyers and sellers to ‘look under the hood’, so to speak, of the home in question and to help guide them in evaluating the home’s performance.

How Buyers Benefit from Working with an EcoBroker®:

EcoBrokers are trained professionals: They are knowledgable about the energy efficiency and cost saving benefits of proper insulation, windows, appliances, heating and cooling systems along with other home features affecting health, comfort and costs.

EcoBrokers can assist buyers to make their new home a healthier environment: They can rely on their network of ‘green’ contractors to help improve the environmental quality of the home including indoor air quality, ventilation, use of low Volatile Organic Compound (VOC) materials and paints in addition to radon and water testing.

EcoBrokers can assist buyers to complete cost-saving energy upgrades and to obtain the needed financing. First, they can help the buyer to get a home energy audit to identify specific energy upgrades and corresponding monthly costs savings. An EcoBroker can also guide home buyers to evaluate their green upgrade financing options. One example is the FHA 203k loan. More information on using an FHA 203k loan to purchase a home and renovate it green can be found in a previous two part blog. EcoBroker help buyers make sound investments in green homes. Green homes typically appraise for more and hold their economic values longer compared to similar homes without green home features and benefits.

EcoBrokers help home buyers have more confidence in the home they are buying. It is important to know what you are getting when you buy a home and how it will perform in terms of health, comfort and costs of operation. EcoBrokers are well qualified to assist buyers in evaluating their new home.

Simply put, a home buyer working with an EcoBroker is empowered to make better more informed home buying decisions.

If you or someone you know are planning to buy a home, consider working with a Certified EcoBroker®. You can obtain information about EcoBrokers in your area at the website for EcoBroker International.

If you live in or are planning to Relocate to the Denver Metro or Boulder County areas of Colorado, I would be happy to assist you finding the perfect home for your needs.

Visit my website at E3GreenHOMES.com for more information about buying or selling Colorado green homes.

John Thomas MSEE, MBA

(m) 720-771-5594

(e) john.thomas@E3GreenHOMES.com

Using the FHA 203k Renovation Loan to Purchase a Home and Make Green Improvements

This is Part II of a two part post about using the FHA 203k renovation loan to purchase a green renovated home. In Part One I described the FHA 203k Loan and summarized the type of renovations that are allowed. In this post I’ll describe the two different types of 203k loans and how they work. I’ll also review the benefits of using the FHA 203k Renovation Loan to purchase a home and make green renovation improvements.

How does it work?

The FHA 203k loan can save home buyers time and money by enabling them to purchace a home that needs repair, modernization or energy efficient improvements using a single loan for the purchase and the renovation. The 203k may also be used to refinance and renovate an existing home. The maximum loan limits are determined in the same way as an ordinary FHA loan (203b) and the same credit qualifications apply. There are two flavors of the 203k renovation loan—Streamlined 203k and Regular 203k.

Streamlined 203kRenovation Loan

As the name implies, the Streamlined 203k loan is designed for more rapid processing by eliminating much of the paperwork and simplifying the process to obtain the renovation funds compared to the more complicated Regular 203k. A Streamlined 203k loan is a part of the original loan balance, resulting in one loan and one mortgage payment. This loan is designed for simple repairs that can be easily estimated and completed. Here are some key points that characterize the Streamlined 203k Loan:

• Maximum renovation amount is $35,000, minimum is $5,000
• Loan may be up to 110% of after improved appraised value (includes purchase and renovation)
• Renovation funds dispersed in escrow 50% at closing and 50% on completion of the project
• Borrowers are not required to hire professional consultants, licensed engineers or architects
• Repairs may proceed from recommendations made by the appraiser or the home inspector
• Borrowers must occupy the property
• Work must commence within 30 days of closing and be completed within 6 months;
• Can be used to refinance an existing mortgage
• Structural renovations are not allowed with the Streamlined 203k Loan

Regular 203k Loan

The Regular 203k is a bit more complicated than the Streamlined 203k. A HUD consultant must be hired to oversee the process and perform inspections of bids and work completed. This loan allows for a complete remodel of the home provided professional licensed engineers and architects are used as needed and all required permits are obtained. Here are some of the key points that characterize the Regular 203k loan:

• There is no maximum renovation cost provided
• The loan is within the FHA limit for the county and;
• The loan is equal to or less than 110% of the after improved appraised value
• A HUD consultant must review and approve the renovations plans and bids prior to closing
• The HUD consultant must review work completed at each stage and approve up to 5 escrow disbursements. -Borrowers must occupy the property
• Work must commence within 30 days of closing and be completed within 6 months; -New additions, structural alterations and reconstruction are allowed
• Luxury items like swimming pool additions are not allowed.

Green Renovation with a FHA 203k Loan

The allowable energy efficient improvements are a huge plus allowing green renovations using 203k loans. Homebuyers can purchase a home and remodel it to include green features and benefits without the need to take out a secondary loan. For example, even though the existing furnace may work fine, a new high efficiency furnace may be purchased and installed with a 203k loan provided they can be shown to be cost-effective meaning the savings over the useful life of the energy improvements exceeds the costs of equipment purchase, installation and maintenance.

With this in mind, almost every home that is purchased with an FHA loan could be renovated to include green features and benefits. It’s important to recognize that a major renovation is not required to make significant energy efficient improvements in most homes. When it comes to energy efficiency there are lots of low hanging fruit including sealing the air envelope of the home, improving the insulation, sealing heating and cooling ducts and upgrading the HVAC, etc. Most homes can easily improve energy efficiency by 30-40% compared to existing performance without excessive costs.

The really great news is that in most cases the decrease in monthly energy expenses due to the improved energy efficiency of the home will more than off-set the incremental increase in mortgage due to the renovation loan. This is HUGE. Every FHA home buyer should understand the many options available to them to utilize a 203k loan to renovate their new home with green principles and products.

The benefits of improved energy efficiency and increased home value come with the bonus benefit of a healthier and more comfortable home renovated to suit the homebuyer needs. And all of this can be accomplished with a single purchase or refinance loan under the FHA 203k program.

Please feel free to contact me with any comments or questions. For information on how to locate and purchase a green home visit my website at E3GreenHOMES.com.

John Thomas MSEE, MBA

(m) 720-771-5594

(e) john.thomas@e3greenhomes.com

Using the FHA 203k Renovation Loan to Purchase a Home and Make Green Improvements

I recently attended a workshop sponsored by Academy Mortgage about Federal Housing Administration (FHA) 203k Renovation Loans. The workshop opened my eyes to a number of possibilities that could greatly benefit home buyers. In this two part blog post, I’ll share with you a few of the key take-away points I learned about. Part one describes the 203k loan and the type of renovations allowed. Part two will describe the two different 203k loans, how they work and the added benefits of using a 203k loan to make green renovation improvements.

What is a FHA 203k Renovation Loan?

The FHA 203k is a loan available through the FHA mortgage insurance program that enables home buyers to purchase or refinance their home with a single loan that includes renovation and repair costs. This is a huge benefit to home buyers because the end result is most often a much nicer home they could purchase otherwise. The added benefit is the home is renovated to their specification which gives it a newer and much more personal feel. FHA 203k renovation loans may also be used with the purchase of HUD homes. For home buyers seeking a healthier, more comfortable and cost-effective home the 203k is an excellent way to renovate their home to include green features and benefits.

Of course, there are guidelines to follow and the process must be adhered to for maximum benefit. Home buyers must be able to envision the changes and willing to endure the time needed to complete the repairs. Patience and attention to detail are key ingredients to the whole process. But the time and effort required can be well worthwhile.

In today’s real estate market, if a home buyer is willing to be patient and follow the guidelines, they can purchase a home that needs repair, sometimes at a bargain price, and fix it up to create equity in the property almost immediately. This can be especially benefickal for first time home buyers. Academy Mortgage and Universal Lending are two well known national lenders with extensive experience in processing FHA 203k Renovation Loans.

What type of renovations is allowed?

Renovations may include small or big jobs including full remodels. Condos, town homes, manufactured housing, single family and most owner occupied 1-4 family mixed use properties. Almost any kind of renovation or repair can be financed including structural improvements, changes or additions. A partial list of allowed renovations includes:

• Kitchen and bath remodels
• New siding or roof
• Painting, landscaping
• Eliminate health or safety hazards such as lead based paint or mold abatement
• Add a garage, sun room, deck or finish out a basement
  
• Energy efficient improvements including insulation, furnace, windows, etc.

In part two, I'll review the process invloved and the added benefits of using a 203k loan to make energy efficiency and other green improvements.

John Thomas MEEE, MBA

(m) 720-771-5594

(e) john.thomas@e3greenhomes.com

E3GreenHOMES.com

Real Estate Recovery Through Retrofit

On Tuesday 20 October, Vice President Biden announced a Federal program to retrofit existing homes and buildings to make them more energy efficient. The intention, as described in the ‘Recovery Through Retrofit Report’ released on the same day is to help create ‘green sector’ jobs while addressing an important environmental issue greenhouse emissions.

Approximately twenty percent of the United States carbon dioxide emissions are generated by the nation’s 130 million homes. The programs goals are to reduce home energy use by 40% by 2020 which would lower greenhouse gas emissions by up to 160 million metric tons. By any measure that is a significant amount. The added benefits of jobs creation and reduced energy bills of up to $21 billion annually make this one of the more synergistic programs to come out of Washington in years.

The growing green home industry, which is currently at the early adoption life-cycle, will receive a much needed boost into mainstream real estate markets. This is a great idea and a great program using business and commerce to solve real world problems with triple bottom line solutions—people, planet, profit.

We must remember, however, the business dynamics and corresponding business models that will be created must become self-sustaining as quickly as possible. If not, it could be destined to become another great government program that fizzles when the funding sources dry up or new politicians are elected.

Green house gases are not a political issue and we cannot buy our way out of the hole we have got ourselves into. But we can solve prove problems with innovative solutions that creates value while improving the quality of life for everyone. We’ve done it before and we can do it again.

US DoE press announcement here.

The White House report can be downloaded here.

Information on Colorado Energy Efficient Real Estate: E3GreenHomes.com

John Thomas MSEE, MBA

(m) 720-771-5594

(e) john.thomas@e3greenhomes.com