Frank Festa NJ Estates Real Estate Group

Some states have specific legislation that requires homeowner associations to have and follow a 30 year repair and replacement plan known as a "reserve study". It is the kind of plan that all HOA boards should follow even if no law exists since that's what good businesses do: plan ahead. Failure to plan for these expensive events inevitably leads to inadequate maintenance, declining property values and dreaded special assessments.

But there are now several new twists that make the idea of a reserve study even more compelling. In most states, HOA boards are allowed to set the level of reserve funding (how much money is set aside each year to address future costs). The fairest approach is the 100% funding model which requires all members along the 30 year time line to contribute a fair share of future costs. However, some boards have for political reasons put less in reserves (sometimes much less) to placate current owners that want to the obligation paid by future owners who have no say in the matter (sound familiar).

Now enters several new 600 pound influences into the reserve funding debate. In December 2007, Fannie Mae and Freddie Mac (the entities that have in past years underwritten most condominium mortgage loans) enacted the following requirements for condominiums where their loans were made being proposed:

1. The condominium is required to have a reserve study.

2. At least 10% of the annual budget must be put into reserves.

FHA (the government agency that insures low down payment loans which have become a huge part of the current mortgage market) is proposing to establish even stricter requirements for condominiums including:

1. Developer controlled condominium reserve funds are required to 100% funded.
2. After developer turnover condominiums are required to be at least 60% funded.

Since Fannie Mae, Freddie Mac and FHA are the 600 pound gorillas in the current condo mortgage market, this means is that if your condominium does not 1.) have a reserve study and 2.) maintain the indicated level of reserve funds, these entities will not underwrite your buyer's or your refinance loan. Folks, this is HUGE.

Condominiums that have an underfunded reserve study need to take decisive action to comply or risk losing vital lending sources. Condominiums that have no reserve study need one as soon as possible and to fund it to indicated levels.

For more innovative homeowner association management strategies, subscribe to Regenesis.net.

Paul Stillwaggon, For All Your Real Estate Needs Contact New Jersey Estates Real Estate Group E-mail: njestates@gmail.com Web: http://www.newjerseyestates.net 908-561-5492 (Paul S) 908-310-1358 (Cell)

NJ Estates Real Estate Group Weichert Realtors 908-561-5492 55 Stirling Road, Watchung, N.J. 07069

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20 University Teams to Compete in the 2009 DOE Solar Decathlon

Read all about it: http://www.energy.gov/8097.htm

Paul Stillwaggon, For All Your Real Estate Needs Contact New Jersey Estates Real Estate Group E-mail: njestates@gmail.com Web: http://www.newjerseyestates.net 908-561-5492 (Paul S) 908-310-1358 (Cell)

NJ Estates Real Estate Group Weichert Realtors 908-561-5492 55 Stirling Road, Watchung, N.J. 07069

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"Ignorance is bliss" was never said about real estate purchases for 7 good reasons:

1. "Knowledge is bliss" may not make it as a buyer's slogan either, because you don't have to know it all-just what's relevant to success as you define it. Different sets of knowledge are important in different buying situations, so the "bliss" generalization may not be specific enough to be useful. "If it is to be, it's up to me" could be an excellent mantra since determination will drive buyers, both to discover what they don't know and then, to fill that knowledge gap. This combined effort will assure a buyer is well equipped to make confident buying decisions.

2. Generalizations are self-defeating when evaluating properties since it is how each is unique that addresses specific value to a specific buyer-if you'll excuse the generalization. All first-time buyers should not seek the same type of real estate solution just because they have never owned real estate before. Each of these buyers, whether they purchase alone, as a couple or with several friends or family members, has a different set of needs, weaknesses and advantages. When generalities are stressed, real estate solutions often concentrate on weaknesses like low down payments. Customized solutions, based on real estate knowledge, should focus on strengths which would counterbalance apparent weaknesses. For instance, first-time buyers may have more creative determination, which can allow them to tolerate living with boarders or tenants. These contributors to mortgage payments create a number of financial benefits and can turn an otherwise financially-out-of-reach property into a great investment solution. (See Pur-Plexing for more on this topic.)

3. Assumptions cost money and waste time. Assume nothing, including that you know what you don't know. Experienced real estate professionals have a wealth of practical knowledge available to fill your knowledge gaps, but you have to be receptive to gain the full benefit. For instance, do you ask questions and listen to the answers? Find out what you're assuming when you view properties, evaluate value and prepare an offer to purchase. The conscious effort and deliberate intent of this clarification means money in your pocket. Determination will enable you to put your advantages into action and use the real estate professional's knowledge to overcome weaknesses. Remember the parsing of "assume" ( make an "ass-[out of]-u-[and]-me" ) if you find yourself thinking or saying, "But I assumed..." and get back in control.

4. Fear has driven too many buyers to act in haste and repent in "if only I'd..." whining that can go on for years. Fear of missing out in a down market or in an up market, or in a variety of other "losing out" scenarios, can cause buyers to dive into a buying or not buying decision which may not be in their best interest. That's why working with a buyer agent, who places your interests first, can be a great strategy for ensuring you have all the knowledge necessary to protect yourself and gain financial advantage at the same time.

5. The impossible may just take a little longer in real estate, but the impossible can happen. Your dream property can be within reach wherever you start financially, but you'll need a solid set of strategies to get you there, not just dreams. Serious about owning your own horse ranch or waterfront castle? Talk to an experienced real estate professional who works in your ideal location to chart a reverse-engineered, long-term course toward that goal. With each property you buy along this clear path, you'll move closer to your high-value goal. It may take two or more real estate purchases and some clever investing, but if will be an interesting progression. If you're determined and build the right team-real estate professional, lawyer, mortgage broker, home inspector...-what's impossible?

6. The unexpected must be expected when buying a home, cottage or investment property. Worst case scenarios, contingency strategies and "Plan B" alternatives are creative tools in preparing to achieve financial gains and desired priorities. These approaches help you react favourably to the unexpected, but hopefully not unanticipated, and take advantage of the opportunities that lie there. Experienced professionals can predict the types of expected and unexpected happenings relevant to your situation. It could be taking advantage of the timing for new listings or the types of lenders beyond banks that hold financing choices for you. Negotiations are all about the unexpected. Most buyers are so focused on purchase price they forget that closing date, number of conditions, what's included in the purchase and other factors can weigh in to reduce the final sale price-that's where professional negotiators come in.

7. Cashflow is king. Beyond the purchase price, cash is necessary to pay for lawyer fees, title insurance or a survey, reimbursing sellers who paid the whole year's property taxes, and on the list of closing costs goes. The professionals involved will provide you with details on possible expenses. While you may have enough cash to close, do you have enough cashflow for owning? Over the first year, unexpected expenses can crop up, so create a projected ownership budget at the same time you go over purchasing costs. This foresight should keep you out of the "house rich-cash poor" category.

With real estate, the best goal is not "buying," but "owning and enjoying" for a lot of great reasons.

Paul Stillwaggon, For All Your Real Estate Needs Contact New Jersey Estates Real Estate Group E-mail: njestates@gmail.com Web: http://www.newjerseyestates.net 908-561-5492 (Paul S) 908-310-1358 (Cell)

NJ Estates Real Estate Group Weichert Realtors 908-561-5492 55 Stirling Road, Watchung, N.J. 07069

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COLUMBUS, Ohio-A new business for Columbus is already under investigation by the Occupational Safety and Health Administration because of a recent fire.

Heartland Refinery is a company near Port Columbus International Airport and recycles used motor oil, stripping it of impurities and reselling the base oil to other companies.

The refinery, described as a green business, had a fire in a truck loading area on October 13.

The fire was caused by static electricity which is generated when oil runs through the pipes.

"They even had that problem on the Alaskan pipeline," said Bill Snedegar, CEO of Heartland Refinery.

When asked if the plant is safe, Snedegar replied, "Absolutely safe. What created that fire and it wasn't like a fire, it was like a spark, a flash and they caught it quickly with the fire extinguishers."

"The product that we handle has what's called low conductivity and we learned a tough lesson," said Michael Kopf, the safety compliance officer at Heartland. "Even a well-designed system like we had wasn't enough to deal with that."

In the time since the accident, Heartland officials said they have improved the system of dealing with static electricity through better grounding, and by extending a flow tube so the oil is pumped into a truck below a fluid line which should prevent arcing.

"It has been the bane of our industry from what I've learned," said Kopf.

OSHA confirmed it is investigating the fire at Heartland Refinery Group and investigators were at the plant Thursday.

The plant is continuing operations during the investigation and OSHA says it could be six months before any citations are issued, if they are issued at all.

Paul Stillwaggon, For All Your Real Estate Needs Contact New Jersey Estates Real Estate Group E-mail: njestates@gmail.com Web: http://www.newjerseyestates.net 908-561-5492 (Paul S) 908-310-1358 (Cell)

NJ Estates Real Estate Group Weichert Realtors 908-561-5492 55 Stirling Road, Watchung, N.J. 07069

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I feel like I'm pretty up on the push for green jobs (creating jobs in the building and installation of wind turbines, construction of energy-efficient buildings, etc.) but this morning at the APHA meeting, I learned something about the occupational health angle of this movement. At a session from the Blue-Green Alliance, Walter Jones of the Laborers' Health and Safety Fund of North America and TJ Lentz of the National Institute for Occupational Safety and Health spoke about making green jobs safe jobs.

So far, it seems that the shift toward greener buildings hasn't done much to make the construction or maintenance of these places safe for workers. (One positive point is that the use of safer paints and solvents can reduce workers' as well as residents' exposure to fumes.) Designers of buildings don't generally pay much attention to the ways that their plans will affect the way workers interact with them, and design schools don't tend to include occupational health and safety in their curricula. Jones noted that between 1990 and 2003, 42% of all US construction-related fatalities were linked to design.

Problems include a lack of anchor points for workers to tie off to when they're working off the ground, and parapets that meet building code requirements (being at least 30 inches high) but not OSHA requirements (39 to 45 inches). When it comes to wind turbines, fall protection is also crucial, and the inside of the tower is a confined space - but designers rarely address anchor points or tower access and ventilation issues.

Occupational health and safety advocates are working to get safety issues on designers' radar. The American Association of Safety Engineers has begun working on a standard to protect workers involved in windpower facilities, and NIOSH runs a Prevention Through Design program. As we all throw our support behind green jobs, we should make sure that "green" includes worker health and safety.

Paul Stillwaggon, For All Your Real Estate Needs Contact New Jersey Estates Real Estate Group E-mail: njestates@gmail.com Web: http://www.newjerseyestates.net 908-561-5492 (Paul S) 908-310-1358 (Cell)

NJ Estates Real Estate Group Weichert Realtors 908-561-5492 55 Stirling Road, Watchung, N.J. 07069

Equal Housing Opportunity

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