Your Local Market Report from your Local Market Expert - Tigard, Oregon

Your Local Market Report - Portland, Oregon -

Portland Market Action Report - July 2018

Save Money and the Environment One LED Bulb at a Time

Way back in 2012, the Energy Independence and Security Act of 2007 was being phased in. One of the most useful — and controversial — results was that old fashioned light bulbs had to be reinvented. All light bulbs manufactured after the phase out dates, which varied from state to state, had to use 25 percent less energy than their ancestors.

With that one change in the way light bulbs would be made rose three major options for homeowners: the curly compact fluorescent bulb, halogen incandescents and the light emitting diode. Although there are some specific uses for halogen incandescents, the most commonly used bulbs in residential settings are CFLs and LEDs. Of the two, the LED is currently the most cost-effective option, even when adjusting for the difference in price.

What is an Light Emitting Diode?

The part that actually creates the light in an LED bulb is a tiny cell the size of a fleck of pepper. Using a mix of blue, red and green LEDs, a bulb manufacturer is able to create white, directional light that costs almost nothing to power.

Unlike incandescent bulbs that waste electricity by converting up to 90 percent of the energy they use into heat and CLFs that release about 80 percent of their energy as heat, LEDs release so little heat that they’re often cool to the touch even after hours of use.

An Energy Star rated LED bulb uses significantly less electricity (up to 75 percent!) and lasts up to 25 times longer than traditional lighting. This is no small thing, especially when you consider that every home, every business, every street light, may eventually sport these bulbs.

Doing the Math: Cost Savings With LEDs

The United States Department of Energy already did the math, a lucky break for bulb-shoppers everywhere. When new bulbs are compared to a traditional 60 watt bulb, the 12 watt LED outshines them all.

According to the Department of Energy, those LEDs use 75 to 80 percent less electricity than the 60 watt bulb and only costs about $1.00 to use for two hours each day for a year. Oh, and the bulb life is approximately 25,000 hours, compared to 1,000 hours for the old reliable.

This means that if you have, say, 50 bulbs in your house and they’re all running for five hours a day (a more realistic number than two hours), your cost to light up with an LED is about $125 each year, for 13.7 years, provided energy costs remain stable.

The same lighting use with the old fashioned incandescent would cost you $600 each year, plus you’d be replacing bulbs every 6.57 months. Sure, maybe they cost a buck or two each, but the constant replacement and increased electricity costs certainly can make a big impact on your pocketbook.

Choosing the Right Bulbs

Along with better lighting standards came a way to compare bulbs across platforms. After all, who really knows which CFL is equivalent to that LED or halogen incandescent option? The Lighting Facts Label solved that problem. Instead of measuring bulbs by the power they consume, it measures them by the light they produce.

Now, a 1600 lumen CFL, LED and halogen incandescent are easy to price compare. This label also includes information on how much energy the bulb uses annually, its lifespan and what color the light is that it produces, measured by the correlated color temperature on the Kelvin scale. It’s an easy way to know that you’re getting exactly what it is that you want in a bulb.

Now That You’ve Moved In, How Are You Lighting That House?

Your new house will eventually reveal its darker spots, meaning you’re gonna need more light to get the job done. But it’s not a problem because your HomeKeepr community can introduce you to the best electricians in your area. Before you know it, your home will be the most luminous thing in the neighborhood — and you’ll be saving bundles because of all the LED bulbs you chose to install.

Smoking kills... your home's resale value

Smoking kills... your home's resale value: We all know that puffin’ is no good for your stuffin’ (organs), but did you know that it can also be detrimental to your home’s value?

Does Your School District Affect Your Home’s Value?

Home values are determined through a complicated series of calculations roughly based on the cost of actual construction plus value-adds like proximity to shopping and other conveniences. The prices that other nearby homes have sold for in the past are also taken into consideration. Formulas are applied, mysterious algorithms are run.

In short, home valuation is magic and appraisers are all wizards.

Although the workings behind the curtain may be both intimidating and seemingly unpredictable to home buyers and sellers, there is one thing that we can say definitely can affect your home’s value is your school district.

The Numbers Have It

A quick twirl around the web turns up a handful of recent surveys and studies that all say essentially the same thing: better schools means your house might be worth more.

It’s interesting, though, that at least one study from the Federal Reserve Bank of St. Louis found that schools that were just barely below the average for quality had no influence on the homes where their students lived. These houses were priced based only on their characteristics, like having three bedrooms or a lot the size of a city block. On the other hand, higher-quality school districts increased each home’s price well above what the physical characteristics would have normally indicated.

The National Association of Realtors reports that 26 percent of all buyers chose their house based on the school district’s quality. However, among age groups prime to have children in the household, 40 percent of those under 36 years of age considered the school district an influential factor, as did 35 percent of those buyers 37 to 51.

The New York Times noted that “There are many factors in a home price, of course, but economists have estimated that within suburban neighborhoods, a 5 percent improvement in test scores can raise prices by 2.5 percent.”

How Much More Will You Pay?

The problem with trying to price a home based on less concrete metrics, like school district quality, is that there’s someone else out there that also has an idea what that added value amounts to and may want to fight you for it. This year in the Dallas-Fort Worth, Texas metroplex, for example, homes were frequently being sold for more than their listed price because someone out there had to have that house in that location and right now.

But, you can still look at price trends for homes in a very general and national way to get a feel for the influence of school districts. The Washington Post reported on a huge study by Redfin that included 407,000 home sales and almost 11,000 elementary school districts across 57 metropolitan markets. The study’s goal was to determine the average additional value brought to homes by their elementary districts.

Surprisingly, top-rated districts brought a whopping $50 per square foot extra when compared to average schools. That’s an extra $100,000 for a 2,000 square foot home!! The effect in California’s hottest markets was even more dramatic, with buyers paying up to $500,000 more for the best districts.

Compromises: School or Shopping?

When Realtor.com announced its findings from a back to school survey in 2013, a few surprising trends popped up. For example, buyers were more than happy to make major sacrifices in order to get their kids into the right school district. Of the people surveyed and indicated that school boundaries were an important factor in their search (90.53 percent), 42 percent would give up parks and trails, 43.96 would give up a bonus room, 50.6 would give up easy accessible shopping and 62.39 percent could live without a pool or spa.

Three out of five buyers said that school boundaries would definitely influence their buying decisions.

Breaking It All Down

All of this may sound quite complicated, but at the end of the day, it’s really simple. There are only so many houses in the best school districts, and there are more buyers to buy than sellers to sell. Since school districts are so important to many buyers, things like bidding wars may result, where buyers make above sales price offers, perhaps many of them, until someone is tapped out and a winner is named.

Their prize? The house that is now $40k over asking price.

It’s a snowball effect, really. Those way-over-asking-price homes end up being comparable homes when the appraiser comes around a few months later, raising the prices of all the homes around them. So, in a very real way, it can be said that your school district, provided it’s a good one and not merely average, has a massive impact on your home’s value.

Where Can You Go for Advice on Buying or Selling in a Hot School District?

Your HomeKeepr community is a wealth of information about all things home ownership. From buying your first house to having a home inspection, getting help with a tax reassessment, or having someone out to repair the gutters, you’ll have your choice of the best home pros in your area. Log in today to find the people who can answer your burning questions or help you navigate a tricky transaction in the school district of your dreams.

7 Things You Didn’t Know About Radon

You found the perfect home. It’s gorgeous, energy efficient, in a great neighborhood and well within your budget. You wonder to yourself, “why is this perfect home still on the market?” Then you read the disclosures. Your perfect pad has a serious radon problem.

Radon and You: 7 Things to Know

Radon is a reasonably common problem in homes, so if you come across a house that you absolutely adore, you’re not even remotely out of luck. Instead, you may reap the benefits of someone else’s lack of information about the gas. Here are seven things to know if you’re considering a home with a radon problem:

1. Radon is a radioactive gas. You can’t smell it, see it or taste it, but it’s the second leading cause of lung cancer anyway. Of course, it doesn’t go straight to cancer right away, but exposure over time will increase the likelihood of lung cancer in the home’s occupants if it’s left alone.
2. Testing for radon is simple. You can choose to perform a short-term, long-term or continuous test for radon levels in a building. The short-term tests are active charcoal-based and only take about a week to complete. These are the kind that are typically used by radon inspectors.
3. Radon is everywhere. Radon occurs naturally in the environment as a result of the breakdown of radioactive elements, such as uranium. Because of that, it’s literally everywhere, but typically in very small amounts. It doesn’t become a problem until you’re exposed to high concentrations of the gas.
4. Smokers are at higher risk of radon-related lung cancer. A 4pCi/L, the level at which radon mitigation is typically recommended, non-smokers have about the same risk of cancer as they do of dying in a car crash, that’s about 7 in 1,000 people. Smokers, on the other hand, are at a risk five times that of dying in a wreck and 62 out of 1,000 may develop lung cancer.
5. You can mitigate radon in any home. With enough money and effort, any home can become a low radon zone. One in 15 homes has an unacceptably high radon level, which is why it’s so important to test yours. Note to home buyers: this is one of those things you can ask the seller to do prior to your occupancy.
6. DIY is possible for radon control. Only attempt it if you’re intimately familiar with your home’s construction methods, radon gas and sampling procedures. A bad DIY radon job isn’t like a bad paint job — incorrect processes can result in higher radon levels than before.
7. It’s possible that your house itself is causing your radon levels to be high. Certain building materials that happen to be almost everywhere in your home, like drywall and concrete, tend to radiate radon in very low levels. Once in a while, though, the radon coming out of the walls is more than just a little bit. In this case, you definitely need an expert to guide the mitigation.

Just because radon is everywhere doesn’t mean you have to live with it. Radon mitigation systems are very good at removing large amounts of radon from any home. Most work by literally sucking the radon right out of the crawlspace or from underneath a poured concrete slab like what you’d find in a basement.

Slabs must be sealed and barriers installed in crawl spaces to ensure that the radon has no place to go but up and out the vacuum system. Once released into the air above your home, it’s no longer a threat and you can breathe deeply once again.

If you need a radon vacuum, make sure yours comes with a continuous monitoring system as well. It might cost a little bit extra, but you’ll know exactly if or when radon levels are unacceptable. Since levels vary throughout the year, this is a good investment in your future.

Do You Have a Pro for That?

Heck yeah! The HomeKeepr community is full of experts that can handle nearly any issue that may crop up before, during or after your home purchase. From plumbers to bankers (and even radon mitigators), your HomeKeepr family has your back. Pop on by to get the latest scoop on the very best pros in the area. Bonus: they come highly recommended by other local experts, so you know you can count on each and every home pro in the community.

Can you afford to finance a tiny home?

Can you afford to finance a tiny home?: As more people buckle under the weight of mortgage and rental rates, alternative housing has become a viable option. Specifically, tiny homes have piqued the interest of those wanting to ditch the picket fence and fat loan. But how affordable is a tiny home? Not very.

House hunters feel burn of hot market in Clark County

House hunters feel burn of hot market in Clark County: A home shouldn’t have been so hard to find, Morganna Figueroa recalled.

The Loan Estimate Form Turns Oranges Into Apples

Shopping for a house can be stressful, but choosing a loan has the potential to be just as bad. There’s a lot to know, a small window in which to figure it all out and a 30 year commitment to a loan product that might just not be right for you for to worry about. All in all, it might be easier to remove your own inflamed appendix than to pick a mortgage.

The Loan Estimate Form and You

If you’ve already been to see one or more mortgage bankers or brokers and received a Loan Estimate form that explains your loan options, grab those now. If not, you can follow along with this dummied up copy provided by the Consumer Financial Protection Bureau. This is definitely a blog that needs some real life props.

There are a lot of things to see on this form, but it’s a million times easier than the form that was its predecessor. The goal with the new Loan Estimate form was to make it more accessible for more people and, hopefully, easier to compare apples to apples. Let’s see what’s in your orchard.

The Big Question: What’s This Loan Cost?

One of the most important variables for many buyers is the monthly cost of their home loan. After all, the monthly payment is immediate and pressing. If you can’t make it, you have nowhere to live and bad things happen. Check out these items to figure your immediate costs:

Monthly Principal and Interest. You can find information on your monthly payment on the front page of the Loan Estimate form. Under the “Loan Terms” section, you’ll find the “Monthly Principal and Interest” line. That’s the base payment for your loan — and if there’s a big, fat “No” next to it, this is always going to be the base payment for your loan, until you sell, refinance or pay it off.

Balloon Payment. Two lines down is the “Balloon Payment” option. You want this to say “No” unless you have a plan to pay the loan off before the balloon hits. A balloon payment is an amount of money you still owe on the loan when the term is up. So, if you have a loan that has payments calculated like it’s a 30 year loan, but the balloon is expected in five, you essentially have to pay 25 years worth of payments all at once when that five year term is up.

Projected Payments. Pop on down to the section called “Projected Payments.” This section breaks your payment down into more parts. Not only is your base payment included, you’ll see a line for mortgage insurance and escrowed items (usually this includes taxes and homeowner’s insurance). If there’s a planned change in your loan payment, like the removal of mortgage insurance, your “Projected Payments” section will have more than one column for payment information. You’ll read this left to right to see how your payment changes over time.

Estimated Taxes, Insurance and Assessments. The escrowed items are detailed in this section. Normally, that’s one month’s worth of taxes, homeowner’s insurance and HOA fees.

Cash to Close. You’ll probably have to bring some money to closing. You’ll find out just how much on the very last line of page one. You can find the details on this figure on page two, but we’re going to skip that for now.

Comparing Your Tree Fruit

On page three, you’ll find one last set of very important numbers for comparing your loan offers. It’s even labeled “Comparisons.” This section will help you understand the long-term differences over the loans that you’re considering. If loan one will cost you $50k over the first five years and loan two costs $60k in the same time period, it’s clear that in the long run, the first loan will do you better. But let’s say you’re not as interested in the long run as you are in the now.

Right now, you have a small down payment and you’re trying hard to hold on to as much cash as possible for emergencies. Back on page one might be the better place to look for your answers. It’s possible that the loan that’s cheaper in the long run costs a great deal more in cash to close. In that case, you may want to take the more expensive long-term loan and plan to refinance after a few years.

While you’re on page one, go ahead and compare those payments. Do both estimate forms include mortgage insurance or escrows? If so, it’s an easy side-by-side comparison. If not, you’ll want to look at the principal and interest payment, and find out what the average taxes and insurance cost in your market so you can estimate how much extra to hold back each month so you can pay those yourself.

How ‘Bout Them Fees?

The elusive page two includes details on your closing costs. This is everything from loan origination costs to prepaid items like your portion of the current year’s taxes. All of this stuff, when added together, end up on the last line in the right-hand column. That’s your cash to close.

If you’ve rolled any of those fees into your mortgage, you’ll see those appear next to the line that says “Closing Costs Financed…” Asking your mortgage professional for a couple of different Loan Estimate forms with and without fees added to your mortgage can help you decide whether it makes financial sense to pay for those items now or finance them over time.

It’s a pretty handy form, really.

Need to Find a Banker or Broker First?

Of course, none of this is meaningful unless you have some context to set it in. That’s where your friendly neighborhood mortgage professional comes in. If you haven’t started shopping loans, your HomeKeepr family can point you in the right direction. After all, your Realtor has already recommended their favorite brokers and bankers, all you have to do is pick up the phone and call. They’re always happy to help.

One Step Over the Line: Property Line Disputes and You

When you moved into your new house, the neighbors were so friendly. You almost felt bad about putting up a fence, but you promised your dog he’d have plenty of room to frolick when you finally owned your own little piece of land. So you did, and now those same neighbors are giving you the cold shoulder, along with a letter from their attorney.

What in the world caused them to turn from the nicest people you’d ever meet to ice-in-their-veins cold? According to their lawyer (they’re not speaking to you anymore), you’ve encroached on their property with your fence.

Property Line Disputes: The Basics

Please note: the laws that revolve around property line disputes vary wildly from state to state, so this topic can only be addressed in broad strokes. We’ll give you a good place to start to understand why your neighbors are so angry, though.

All you wanted to do was build a fence. You thought the place you stuck it looked right — it was kinda along the middle of the space between the two houses. You kind of figured that if you were off by a foot or two, it wouldn’t be that big of a deal. As it turns out, people get really touchy about a foot of land these days.

What’s happened here is that you’ve accidentally taken the first step to adverse possession of the neighbor in question’s land. This threatens to decrease their property value, since you could, in theory, become the legal owner of that land given enough time and effort. Of course, you didn’t mean to do it, but they can’t see that right now. Right now they’re just angry.

What is Adverse Possession?

Adverse possession, as defined legally, is when a random person occupies your property in an open, hostile and continuous way. Breaking it down:

The open: The occupant made no secret of being there. They’re not hiding or trying to be sneaky.

The hostile: You didn’t tell this person it was ok to hang out, they didn’t seek your permission anyway, maybe they thought it was theirs or maybe they just didn’t care who owned the place.

The continuous: The usurper is there for a long time without stop. In some states, this can be as little as about five years, in others it might be 20. It’s important for affected owners to act fast if they don’t know which category their state is in.

By not having your property surveyed before putting up your fence, you’ve done all of these things, though obviously not intentionally. But now that you know, it’s time to do something to clear the air.

Some Solutions to Boundary Woes

In this scenario, you’re the accidental assailant, but it could just as easily happen in reverse, where you’re the one whose new neighbor built a fence that you weren’t happy about. Either way, the approach is similar.

Step 1. Talk to the neighbor. If you did the encroaching, apologize profusely and throw yourself on the mercy of your neighbor. Explain that you didn’t realize you needed a survey or that you thought you were putting the fence in the right spot. Often people will surprise you with their ability to forgive if you’re willing to meet them part of the way.

Step 2. Figure out your options. With the neighbors warmed up again, it’s time to figure out how to solve the problem. You could simply have a survey, dig up the fence and move it to the proper location. But, let’s say that’s currently cost-prohibitive, what with the recent house purchase and fence erection both taking up a lot of your free cash. To protect your neighbor’s rights, start with one of the following:

* A notarized letter granting you permission to use the land. This way, you’re openly declaring that your intentions are not hostile and the owner is giving you permission to be on their land. You can leave your fence in place — at least for now.
* A rental agreement. By agreeing to a small rental fee (even as low as a few bucks a month), you immediately acknowledge that your fence is on the neighbor’s property. Should they want to sell their home, they could simply terminate the rental agreement and you’d have to move the fence. It might be a good idea to stipulate a deadline for moving the fence just to protect everyone.

Whatever you choose, make sure to file a copy with your county recorder so that it becomes a public agreement. This will help your neighbor by creating a permanent record that any appraiser or title researcher could pull up later should the fence problem threaten to cloud their title.

What If You Can’t Come to Terms?

If you’re in the situation where the shoe’s on the other foot — your neighbor built his fence on your lot and you sent the letter from the attorney, then you’re the one that’s angry and frustrated at such ruthless behavior. Remember that it could have been a simple oversight, but definitely try to work it out with minimal bloodshed initially.

If, on the other hand, you went to chat with the neighbor and he told you he liked your lot and wanted to keep it for himself like some sort of real estate pirate, well, you can’t just leave it like that. You may have to take him to court to settle the issue (if you live in a planned neighborhood with an active HOA, they may have a mediation process in place to handle these problems).

In the weeks leading up to court, you may be given any or all of these options by the neighbor’s attorney as a settlement: sell your property, split the difference or give up and let the pirate win. Likely end results of these choices include:

Sell: You lose a piece of property that could affect your real estate values. If it’s a few inches, maybe it’s not a big thing, but if it’s several feet all the way down your 200 foot long lot line, it could be an issue. Consult with a Realtor or appraiser for more on the value impact, as well as how much compensation to seek.

Split the difference: You’re not admitting defeat, but it’s still not the outcome you’d hoped for. You still lose something, though not as much as you would have if you hadn’t gone to court. If the neighbor will pay you something for your loss, consider it.

Give up: Don’t do this. It’s just like selling, except you don’t get any compensation for the property you’ve lost.

Always consult with your lawyer before making a final decision on how to handle a property line dispute.

It Might Not Be Too Late to Avoid Trouble…

If that fence hasn’t gone up yet, it’s not too late to avoid all this hassle by hiring a surveyor. They’ll locate the pins planted at the corners of your lot and mark the line clearly, so both you and the neighbor know exactly where the boundary is located.

Don’t know a surveyor? That’s ok, your HomeKeepr family has you covered! Just log in today and your Realtor can recommend a surveyor (and a fence builder!) that can come by and ensure that you’re not going to have to have an unpleasant conversation down the road.