Independent home inspections are crucial for would-be buyers
Would-be home buyers who come across unoccupied houses in their search for for their dream home should be extra careful.
Homes aren’t cared for all that well even when they are lived in, according to independent home inspectors. When it comes to regular maintenance, owners tend to be lax about changing the filters in their furnaces and air conditioners, fixing leaky faucets and repairing balky doors and windows.
But when a house is empty, all kinds of problems can occur. And when a house is in the throes of foreclosure, those issues are magnified.
Bargain-priced properties in foreclosure represent an opportunity but also a danger for unassuming buyers.
Even if the last owner left the property with its walls and plumbing intact, it still pays to be extra careful. An example: When a house is closed up for too long, mold can grow. And not just behind the walls, but out in the open as well.
In a humid climate, or in a house where the water hasn’t been turned off and there are leaky faucets, mold can be extensive. And when a house is boarded up, the situation is exacerbated. Inspectors say they have seen homes covered in black mold after just a few weeks of being unoccupied.
Of course, the mold can be eliminated with proper ventilation and can be cleaned up. But the chore could be expensive and time-consuming.
Whether or not the last owner moved out willingly, when a house has been empty for an extended period, it is common for inspectors to find leaking valves, gaskets and appliances.
No matter how large or small or expensive the house, every plumbing fixture and appliance has at least one valve, gasket or hose that can dry out if the item in question is not in use. That causes gaps that can result in leaks or even floods when a new owner moves in.
Moreover, if the sewer trap is allowed to dry out it could allow methane gas to back up into the house.
Then there’s the problem of unwelcome guests — human and otherwise. Empty houses are often the targets of vandals or thieves looking to steal anything that has an ounce of resale value, and squatters have been known to occupy such homes until they get the boot.
The handiwork of vandals is readily evident — graffiti spray-painted on the walls, for example — but thieves rip out everything from the kitchen cabinets to plumbing fixtures, from wiring and sometimes even structural elements without any regard to the ancillary damage they might cause.
If such damage goes undetected by a would-be buyer, the new owner could be in for some major headaches.
Insects, rodents and small animals such as raccoons can cause as much or even more damage. Even when vermin make themselves at home for a relatively short period, they can leave fleas behind and their droppings can cause unsanitary conditions.
Problems with blocked or damaged waste and sewer lines are common in houses that remain empty for too long. The longer the vacancy, the worse the damage can be.
Obviously, it pays to hire an independent home inspector to examine an empty house, or at least base your offer on a satisfactory inspection. It also pays to hire an examiner to review an occupied house. At the same time, here are some red flags that you can spot on your own before you get to that point:
* Extension cords. A snake pit of wires running hither and yon from wall outlets to lamps, radios, TV sets and desktop computers could be a sign of an outdated electrical system. If that’s the case, the house could require an entire electrical upgrade to meet your needs. A home inspector should be able to tell you whether a new panel and wiring is needed or that additional receptacles will suffice.
* Water pressure. If you turn on the faucet and the water seems to just drip, or you hear a gurgling sound, it could be evidence of a problem with older galvanized piping or inadequate piping. In many cases, sections of piping can be replaced to correct the problem, but sometimes a completely new plumbing system is called for.
* Foundation cracks. For the most part, vertical cracks are within normal settlement tolerances, but horizontal cracks are not. A horizontal crack generally results from hydrostatic pressure against the home’s foundation, and correction will often involve excavation and drainage provisions as well as repairs to the wall itself.
If horizontal cracking is evident, several structural engineers should be consulted to ascertain the extent of movement as well as corrective measures. Opinions often vary when it comes to structural elements, so it is best practice to get several opinions.
* Wall or ceiling stains. Any stain should be further evaluated to determine the cause and extent of any possible hidden damage. A good home inspector will search for the cause as well as test the stain using a moisture meter to determine whether or not it is active.
Posted by Bill Siegel Florida Home Inspection Team Inc.
REQUIRED BUILDING PERMITS IN MIAMI GARDENS
This is taken from the Miami Gardens web site:
- fence construction
- shed installation
- screen enclosures
- installation of a patio slab
- gazebos
- roofs
- room additions
- docks and seawalls.
Many interior alterations also require a permit such as;
- electrical wiring
- drywall
- plumbing changes
- water heater installations
- doors and windows to name a few.
This is not a complet list. Please contact the Building Services Division at (305) 622-8027 before commencing construction to determine whether a permit is required.
This is why it is always important to conduct a permit search on the home you are about to purchase.
Posted by Bill Siegel Florida Home Inspection Team Inc.
MINIMUM STANDARD FOR DWELLINGS IN MIAMI GARDENS
Fines can be assesed if these standards are not met.
Posted by Bill Siegel Florida Home Inspection Team Inc.
All properties in the City of Miami Gardens must be maintained in good condition. This includes:
No broken windows or doors.
North Miami Beach Building Permit Requirements
The following is from the North Miami Beach Building Department web site:
A building permit is required for all new construction and for any repairs or reconstruction which alters a structure.
Building permits are also required for other constructions such as:
- driveways
- accessory buildings (sheds, garages, etc.)
- burglar alarms
- fire alarms
- heat pumps
- air conditioning units
- lawn irrigation systems
- fences, re-roofing
- screen enclosures
- docks
- swimming pools
- septic tanks
- water heater replacement
- drainfield repairs/replacements
- sanitary sewer connections
- sidewalks
- slabs or patios
- tennis courts
- tree removal and satellite dishes.
5 Home Ownership Myths to Avoid
Popular financial advice changes direction fast when a market experiences historic declines over a short period. Several years ago, financial gurus focused their attention on real estate. The advice that sold the most books suggested buying as much real estate as possible, using as much of other people’s money as possible.
[Slideshow: 10 Things to Splurge on This Summer.]
Many people who relied on debt for building a real estate empire are now suffering the consequences of over-extending their financial reach, but real estate investments are just one part of the tale. Some homeowners who relied on the same, mogul-based advice for buying their one and only home set their families up for financial disaster.
They believed the hype prevalent in the real estate market and decided to view their home as an investment. Perhaps chasing the American dream of home ownership, they weren’t prepared for the reality. If you are considering the purchase of your first home, don’t make the decision for the wrong reasons.
Avoid believing these home ownership myths:
“Your home is a good investment.” Aside from recessions, there is a good chance your house will hold its value in the market over long periods of time, but it won’t appreciate in value much more than the rate of inflation. Unless there is something special about your home, you probably won’t get rich just by owning it. If you’re not renting out a room or otherwise producing income with your house, it generates expenses like maintenance, insurance, and taxes. Good investments generate income, not expenses.
When you sell your house, you can’t just subtract your purchase price from the sale price to determine how much money you earned through home ownership. Your “cost basis” includes any improvements you’ve done, all the maintenance expenses you’ve paid, and your tax bills, so you must subtract these amounts from your sale price as well. Any expense that you wouldn’t have paid as a renter or through any other investment should be taken into account, and you’ll likely find you haven’t made as much money as you believe. Consider the true cost of buying and owning a home.
“I’ll get a tax deduction.” While the government provides a tax deduction for mortgage interest as well as other tax credits related to energy-efficient appliances and other green technologies, these benefits do not outweigh the expenses. Many homeowners find that even with the availability of a mortgage interest tax deduction, their tax return isn’t affected because they are better off taking the standard deduction.
Even if you qualify for the maximum home buyer tax credit of $8,000, your tax benefits are unlikely to compare with the lower expenses renters experience.
[See Pay Off Mortgage Faster -- Or Invest?]
“Renting is throwing money away.” In the early stages of paying a mortgage — or if you opt for an interest-only mortgage — there isn’t a substantial financial difference between renting and owning a house. While renting, however, you have flexibility to move as needed without the expense and hassle of selling the home. You also have fewer expenses and responsibilities and your landlord takes care of maintenance, saving you effort as well as money.
“Home ownership encourages forced savings.” As you pay off the principal of your mortgage, you are locking away cash into your net worth for safe-keeping. A problem arises when you want to access that cash. A true savings account earns you interest and is accessible at any time. The savings in your home can only be accessed by selling, refinancing, or taking out a loan or line of credit on the house. In the case of refinancing, many homeowners end up extending the length of their mortgage and paying more interest to the lender over time.
The best way to encourage forced savings is to open a high-yield savings account and contribute automatically with direct deposit or automated transfers.
“Renting is always the better choice.” While finances play a strong role in an important and potentially expensive decision-making process, it shouldn’t be the only factor. Although renting and investing your extra income in the stock market might have a financial benefit over paying a mortgage and expenses, many people may rent without making that additional investment. Run the numbers, but also consider what is right for you and your family at the time you need to make the decision.
Luke Landes writes for Consumerism Commentary, where he encourages discussions about money and consumer issues. Consumerism Commentary regularly tracks and reviews the best online savings accounts and other financial products.
Posted by Bill Siegel Florida Home Inspection Team Inc
Homes lost to foreclosure on track for 1M in 2010
LOS ANGELES – Rosalyn Dalebout rents out space in her home to three tenants, has cut off her phone service and canceled her earthquake and life insurance — all to pay her mortgage every month. So far, she’s one of the lucky ones. More than 1 million American households are likely to lose their homes to foreclosure this year, as lenders work their way through a huge backlog of borrowers who have fallen behind on their loans. Nearly 528,000 homes were taken over by lenders in the first six months of the year. If foreclosures continue at that rate, the yearly number would eclipse the more than 900,000 homes repossessed in 2009, RealtyTrac Inc., a foreclosure listing service, said Thursday. “That would be unprecedented,” said Rick Sharga, a senior vice president at RealtyTrac. Lenders have historically taken over about 100,000 homes a year, he said. The surge in foreclosures reflects a crisis that has shown signs of leveling off in recent months but remains a crippling drag on the housing market and the economy. Many homeowners struggling to make their monthly payments have had little success in negotiating more deals. Dalebout, a manager of a recreation center who lives in the Salt Lake City suburb of Holladay, said her lender has refused to refinance her loan with lower rates and payments. The monthly payments on her $240,000 mortgage take more than half her salary. “I’m just running into a lot of brick walls,” Dalebout, 58 said. Banks seem to be creating two classes of troubled homeowners. Those who are falling behind in their payments are being allowed to stay in their homes longer because lenders are reluctant to add to the glut of foreclosed homes on the market. At the same time, lenders are stepping up repossessions to clear out the backlog of bad loans. “The banks are really sort of controlling or managing the dial on how fast these things get processed so they can ultimately manage the inventory of distressed assets on the market,” Sharga said. On average, it takes about 15 months for a home loan to go from being 30 days late to the property being foreclosed and sold, according to Lender Processing Services Inc., which tracks mortgages. The number of homeowners that received a legal warnings that they could lose their homes in the first half of the year climbed 8 percent from the same period last year. But the rate dropped 5 percent from the last six months of 2009, according to RealtyTrac, which tracks notices for defaults, scheduled home auctions and home repossessions. About 1.7 million homeowners received a foreclosure-related warning, one of several steps in the foreclosure process, between January and June. That translates to one in 78 U.S. homes. Nevada posted the highest foreclosure rate in the first half of the year. Arizona, Florida, California and Utah were among the other foreclosure hotbeds. But the problem stretches to all parts of the country. Sherri Leu of Lino Lakes, a suburb of Minneapolis, is unemployed and stopped receiving unemployment benefits earlier this year. “I burned up my savings,” she said. “The best thing that’s going to help me is a job.” The software engineer has been living on what’s left of a $120,000 home equity line of credit she took out shortly after she bought her house in 2006. Leu estimates she’s got enough money for another five or six mortgage payments. “I might try to put it up for sale,” Leu said. “The other option is to let the bank have it, but then I’ll end up walking away losing money I put down on the house.” Assuming the economy doesn’t worsen, RealtyTrac’s Sharga projects lenders won’t work through the backlog of distressed properties until the end of 2013. More than 7.3 million home loans are in some stage of delinquency, according to Lender Processing Services. The fastest-growing group of foreclosures is coming from people who took out conventional fixed-rate loans. The prospect of lenders taking over more than a million homes this year is likely to push housing values down, experts say. Foreclosed homes are typically sold at steep discounts, lowering the value of surrounding properties. “The downward pressure from foreclosures will persist and prices will be very weak well into 2012,” said Celia Chen, senior director of Moody’s Economy.com.
Posted by Bill Siegel Florida Home Inspection Team Inc.
Home Inspection Licensing
The home inspection licensinglaw finally took effect July 1. It will not be enforced until March of 2011. The department of business and professional regulation are accepting applications and issuing licenses, even though they have not written the administrative portion of the bill yet. The standards of practice have not yet been published, so any inspectortouting his license is still using whatever standards they were originally reporting to. When the standards are published, all inspectors will need to report by those standards. We have a good idea of what they will be, and I can assure you that they will be more specific and stringent that what most inspectors now use. It has always been my contention that you should use an ASHI, NAHI, or FABI certified inspector, as they have the toughest standards in the industry.
When you are looking for an inspector, please use careful due diligence in qualifying them. At this point, just because someone says they have a license does not put them above any other inspector. There are still no enforcement of these laws taking place, and they will not take place until March of 2011.
Posted by Bill Siegel Florida Home Inspection Team Inc.
Homeowners hit with higher insurance premiums
http://www.sun-sentinel.com/business/fl-florida-insurance-rate-hikes-20100709,0,6972239.story
Warren Kurtzman was elated when Gov. Charlie Crist vetoed legislation last month that would have made it easier for insurers to raise property insurance premiums.
That’s why it came as a shock when his insurer, HomeWise Insurance, informed Kurtzman two weeks later that the premium on his Delray Beach condominium unit is increasing by 42 percent – from $609 to $864 – this year.
“I thought [the veto] was the greatest thing in the world,” Kurtzman said, “and all of the sudden, I get this [notice] and I almost choked!”
Despite Crist’s veto, and four relatively quiet hurricane seasons, thousands of Florida residents are experiencing similar rate hikes this year. The reason: Crist’s veto doesn’t end rate increases – they’re still allowed for some reasons, with state approval.
In the past 12 months, the Office of Insurance Regulation approved about 140 residential insurance rate hikes, ranging from less than 1 percent to 29 percent. Some individual policy holders’ bills went up more because the approved rate increase is a statewide average.
The increases were approved after many insurers argued that efforts made by the state Legislature to cut premiums in 2007 and 2008 had left them unable to keep pace with claims and other costs. Lawmakers were pressed to act after policyholders experienced huge increases in premiums – doubling and tripling in some cases – after Hurricane Wilma in 2005 and other storms.
Last year, Crist signed legislation that made it easier for insurers to boost premiums as much as 10 percent annually to pay for certain backup coverage costs. About 22 of the 140 increases were filed under that law.
Regulators say there are deeper problems with the property insurance market, including the development boom during the past few decades and, in turn, an increase in the possible damage that could result from a major hurricane.
As homeowners’ policies come up for renewal, they are learning that their rates are rising. Some say they feel helpless dealing with their property insurance, which is required by most lenders.
Karen Leshin, of Weston, said her State Farm property insurance premium increased 60 percent, from $3,198 last year to $5,110 this year. “How is it possible?” she said. “We’re kind of caught between a rock and a hard place.”
Leshin said she wants to move out of Florida due in part to the cost of insurance. But like many other Floridians, her home isn’t worth close to what it was when she and her husband, a retired airline pilot, bought it. She said they have bought State Farm policies to insure their home and cars since 1971. Before paying the higher premium, she said she tried shopping around but found other insurers charging about the same.
“I guess they all got the memo,” she said.
Kurtzman said he plans to shop around. He said he can’t afford a dramatic rate hike because he’s on a fixed income after retiring from a career in finance: “I’m getting killed in the stock market.”
Sylvia Dow, a retired communications worker, said her insurer, Southern Fidelity Insurance, increased the premium on her Margate home by 36 percent from $2,010 to $2,729 this year.
“It was quite a shocker, but we have to deal with it because we have to have insurance,” she said.
Dow said she was surprised when Allstate dropped her coverage in 2007 because she doesn’t live near the coast and she hasn’t filed a claim in the 20 years that Allstate covered her home and car.
Major national insurers such as Allstate and Nationwide dropped policies after the 2004 and 2005 hurricanes. State Farm, the state’s largest property insurer, faced some unique challenges.
The company announced its plan to leave Florida’s property insurance market early last year after the state rejected its request for an average rate hike of up to 67 percent.
Months later, the state Legislature approved a sweeping measure to deregulate insurance rates, hoping it would help the state keep companies like State Farm in Florida, but the bill was vetoed by Crist.
But Deputy Insurance Commissioner Belinda Miller said State Farm’s low rates were its own doing: Unlike other insurers, the company offered voluntary discounts, not required by the state, for years.
“That was not rate suppression. That was a company doing in Florida exactly what it’s doing in other states,” Miller said. “They put us through hell over the 67 percent rate increase when in fact at least half of that was self-inflicted.”
Eliminating the discounts translated to a statewide average rate hike last year of 28 percent for State Farm, regulators estimated. State Farm struck a deal with regulators to stay in Florida but to drop 125,000 policies and increase rates by another 14 percent, on a statewide average basis.
Miller said Florida’s problem stems from its growth in development in recent decades, which means there’s more potential damage from hurricanes. At the same time, insurancen companies have less appetite to cover catastrophies; they’d rather sell other, more profitable types of insurance, such as autos and other vehicles.
“It’s not that we have more hurricanes. The problem is we’re building more in their path,” Miller said.
In addition, some lawmakers and regulators argue that it’s unclear just how bad insurers’ financial health is; many pay fees to affiliate companies to manage parts of their business. Unlike the insurers, their affiliates aren’t subject to regulatory restrictions on profit and dividends, and they aren’t required under state law to file audited financial statements.
“It seems like there’s a big loophole there,” said Chris Cury. Cury is a real estate developer who recently got his license to become a public insurance adjustor.
State Farm increased the premium on Cury’s home in Plantation from $2,500 to $4,200 – 68 percent. “I didn’t understand it because there hadn’t been hurricanes in several years,” he said. “I’m in the real estate business, so it hit me hard.”
Gail Bierworth, of Lighthouse Point, said State Farm increased her homeowner insurance premium 83 percent, from $3,395 to $6,214, even though her home was completed in 2005 and has hurricane impact windows and other features fortifying it against storms. She said State Farm covers her home and car. She’s purchased her homeowners insurance from the company for 20 years – and never filed a claim.
“I can’t believe that a company can raise the premium 83 percent in one year. This seems to me to be most unconscionable, especially at this time of our uncertain economy,” she said before calling state officials to complain. State officials, she said later, weren’t very helpful.
She ultimately she lowered her coverage dramatically – from $698,600 to $390,000 – to bring the premium near last year’s, $3,420. “That was the lowest they’d be able to lower my coverage,” she said. “It’s probably on the low side…but I’m comfortable with it.”
Posted by Bill Siegel Florida Home Inspection Team Inc
Refrigerator Retirement Savings Calculator
You probably know that refrigerators are typically the most energy-hungry appliances in your home, so the more efficient your refrigerator the more money you can save. Older refrigerators are usually two to three times more costly to run than newer models. If you still have a fridge from the 1980s, replace it with an ENERGY STAR qualified model and save over $100 each year on your utility bills. Replace a fridge from the 1970s and save nearly $200 each year! If you are wondering whether replacing your refrigerator is a good decision for you, ENERGY STAR Savings has a calculator you can use to find out exactly how much money you’ll save by replacing your existing refrigerator
Truths and myths of dryer fires
Here’s a frightening claim: Fabric-softener sheets can burn out the heating unit of your clothes dryer and possibly cause a fire. That’s the warning in an e-mail message sent to one of our readers, who asked us whether it’s true.
The short answer is no, though dryer fires are a real hazard and there are ways to protect yourself.
In the e-mail, an unknown author warns of a clothes dryer’s burned-out heating unit. According to a “repair man,” the author writes, the burnout was caused by fabric-sheet film buildup on the lint filter. “You can’t SEE the film, but it’s there,” the author writes. “This is also what causes dryer units to catch fire and potentially burn the house down.” The best way to avoid these problems, according to the “repairman,” is to take that filter out and wash it with hot soapy water and an old toothbrush (or other brush) at least every six months.
But according to Consumer Reports testers, this e-mail mixes a lot of hyperbole with only a few helpful dryer-maintenance tips. At Consumer Reports we’ve tested hundreds of clothes dryers for our ongoing dryer Ratings and recommendations (available to subscribers). CR’s appliance director, Mark Connelly, says it’s possible that over a long period, fabric sheets, fabric softeners, and laundry detergent ingredients contribute to an unseen film or waxy buildup on the dryer lint screen. But “it’s highly doubtful,” he said, “that any such invisible buildup alone leads to heating-unit burnout or a fire.”
Improper dryer vents are a much bigger and more common safety problem. Here are a few tips to keep your clothes dryer running safely and efficiently.
To find the clothes dryer and a washing machine that best meet your needs, see our dryer Ratings and recommendations, and our washing machine Ratings and recommendations. For advice on whether repairing your broken dryer or washer is worthwhile, see our repair or replace report (all available to subscribers).