Subject: Citizens Source Water Protection Committee to meet Sept. 14
NEWS FROM THE DELAWARE DEPARTMENT OF NATURAL RESOURCES AND ENVIRONMENTAL CONTROL
For further information, contact Joanna Wilson, Public Affairs Office, 302-739-9902.
Citizens Source Water Protection Committee to meet Sept. 14
DOVER (Aug. 31, 2011) – The Source Water Protection Citizens and Technical Advisory Committee (CTAC) of the Source Water Assessment and Protection Program will meet from 9 a.m. to noon Wednesday, Sept. 15 in Conference Room 220 A&B of the Kent County Administrative Offices on Bay Road in Dover.
The agenda includes the following items:
• Update on recent source water projects and initiatives in Delaware including:
• Final report on the Rapid Infiltration Basin Study
• Update on the Web Delivered Application for Hydrogeologic Data ; and
• A presentation by Laura Mensch of the Delaware Department of Agriculture on the
Delaware Pesticide Monitoring Network.
Delaware’s Source Water Assessment Plan was approved by the U.S. Environmental Protection Agency in October 1999. The program is charged with delineating source water areas around all sources of public drinking water in the state, identifying all existing and potential sources of contamination within those areas and making the information available to the public. The Source Water Protection Law of 2001 maintains the CTAC as an advisory committee to the Secretary of DNREC on the implementation of the Source Water Assessment Plan and closely related matters.
For more information about the Source Water Assessment and Protection Program, including a full agenda for this meeting, please visit http://www.wr.udel.edu/swaphome/meetings.html, or contact Program Manager John Barndt or Hydrologist Doug Rambo, Water Supply Section, at 302-739-9945.
Last week we told you about a free webinar opportunity that NAHB had set up to answer our members’ questions regarding the impacts of the latest economic news, stock market turmoil, the S&P credit rating downgrade and other events on the housing market. This event, in which NAHB Chief Economist David Crowe presented his latest forecast revisions and NAHB CEO Jerry Howard commented on the political outlook, attracted quite a few participants. In fact, with more than 230 people listening in from 166 locations nationwide, it was NAHB’s largest webcast event thus far. If you missed this popular webinar, or if you’d like to see it again, a full replay is now available on our website — click on the link below to access it.
If you experience technical difficulties, please contact Jill McKibben (800-368-5242, x8659) for assistance.
And builders aren’t the only ones complaining. “Banks are hiring subpar appraisers,” says Ken Chitester, director of communications at the Chicago-based Appraisal Institute. The problem, he says, harks back to 2009, when the federal government responded to the inflated values of the boom by stipulating that firewalls must be placed between a lender and an appraiser. That led to the rise of appraisal management companies (AMCs), which act as middle men for appraisers, generally on a contract basis.
The trouble comes in, Chitester says, when AMCs take a large cut of appraisal fees, keeping prices down by forcing the appraisers to take a smaller cut than experienced appraisers used to be accustomed to. “You don’t get on the list if you don’t accept bargain bottom fees and conform to very fast turn-around times,” which encourages use of the least experienced appraisers, he says. When more experienced appraisers are used, he argues, the lower rates pressure them to skimp on quality. “If you were making more money, you have to make up in quantity what you were making in higher charges.”
Appraisers certainly aren’t the only ones frustrated at the current condition of things.
“I’ve got black eyes and bruised knuckles,” quips Ben Spofford, owner of Aurora, Ohio-based Benjamin Builders, when asked about his experience dealing with appraisers. “A local builder really has to put up a fight.”
A main point of contention Spofford and other builders cite is appraisers’ use of foreclosures as comparable properties. That comparison may be legitimate, Spofford says, “but it has to be apples to apples. That repossessed property has to be in pristine condition to be equivalent. A listed foreclosure at a comparable square footage may still need a lot of work.”
But the equation is somewhat more complicated, says Betty Graham, senior vice president of operations at Fairway Independent Mortgage Corp., a national mortgage financing firm that also deals in appraisals. While agreeing that new construction requires new-construction comps whenever possible, Graham argues that if foreclosures are a prominent feature in a given market, they affect home values for the entire neighborhood, new or used.
In an effort to avoid the foreclosures-as-comparables mess, many builders are aiming for niches that foreclosures don’t fit. “When you’re building on family land or larger parcels or custom stuff, the [appraisal] battle can be won, but it won’t be if you don’t fight for it,” says Chad Ray, owner of Olde Heritage Builders in Zebulon, N.C. “But if you’ve got five foreclosures and three short sales [comparable to your property], I don’t have the answer. How do you win that battle?”
Another differentiator, of course, is green and energy-efficient features. But while helping fight off some comparables, the nature of these features also makes them some of the hardest to have recognized on an appraiser’s checklist.
“Anything you can’t put a dollar figure on is undervalued,” says Ray. “We’re adding 2% to 3% of the cost of the home to include Energy Star features. Our HERS scores are between 52 and 56, and our homes are 45% more energy efficient. There’s numbers there. We can say we’re adding $60 a month on mortgage bills but we’re saving the customer $120 a month on energy bills, so they’ll recognize that. But things like indoor air quality, lower carbon footprints, lower maintenance costs—you can’t put a dollar sign on it, so they’re just not seeing it. But when a family with an asthmatic child moves into our home and they breath better, they sleep better, and they have fewer sick days, you ask those families what’s more important, and they’ll say those features are far more important than saving $70 on a heating bill.”
“It’s a really, really tough topic,” Graham acknowledges, adding that at the end of the day, it will depend on what a local market will pay for. “In some [places] such as California, where green features are really important to buyers, people will pay more for it.” But in areas such as the Midwest, she says, buyers won’t want to pay more for it, so appraisers won’t consider it added value.
In order to combat the ambiguity problem, Jay Hankla, general manager at Shaddock Homes, which builds energy-efficient homes in the Dallas-Fort Worth area, believes monetary values should be assigned to given standards. “If you’re Energy Star 3.0 compliant, you should get an automatic $10,000 or $15,000 added to your house,” he says.
Until that day comes, however, builders seem to be focusing on educating their appraisers in an effort to help them see the value of the features they’ve included, pointing out when homes will cost less to operate and maintain.
The best thing builders can do, Chitester says, is provide appraisers with any and all data they have on their home and its expected performance. “Things like ratings information, blueprints, specifications of a property’s conservation features—whatever you can get your hands on,” he says. “Appraisers are very interested in working with builders and others to collect green building data.”
And at the end of the day, Ray says, it behooves the builders to take responsibility to ensure that the appraiser is qualified. “It’s your right and your duty to ask for a competent appraiser who has been trained in the value of green homes. If the bank doesn’t assign you one, ask for a different appraiser until you get one.”
According to Paul Grutsis, an appraiser based in San Bernardino, Calif., a builder can help make his or her case by finding sales similar to the home being estimated that will help to support a given price. To ensure that such comps are available, one builder, who asked to remain nameless, has taken to paying multiple listing service agents to list his company’s new homes so that when appraisers are looking for appropriate comparables they can find them.
“We spend a lot of time educating an appraiser as to the costs of what it took to build,” Spofford says. “We’ll go through room by room if we have to. I mean, am I not entitled to a profit?”
But appraisers argue that building costs and value don’t necessarily match up. Chitester points to the Cost vs. Value Report conducted every year by Builder’s sister publication, Remodeling, as a resource to find out what features are valued in different markets around the country. “Cost and value,” he says, “are not the same.”
Claire Easley is a senior editor at Builder.
Mortgage rates have nowhere to go but up ; So now’s the time to refinance or get serious about buying a home
Sandra Block, USA TODAY
1 August 2011
© 2011 USA Today. Provided by ProQuest Information and Learning. All Rights Reserved.
If you’re considering buying a home or planning to refinance, here’s some advice: Lock in a mortgage
Mortgage rates could shoot higher if lawmakers fail to reach an agreement to raise the debt ceiling by
Tuesday, says Greg McBride, senior financial analyst for Bankrate.com.
Even if default is averted, there’s little downside to locking in a rate.
A government default would cause Treasury bond prices to plummet, and yields would rise. “Uncle
Sam’s borrowing rate is the baseline from which all consumer and business borrowing rates are
determined,” McBride says. “If Uncle Sam’s costs go up, borrowing costs go up for everybody.”
And even if the default is short‐lived, the ratings agencies have signaled they’ll downgrade U.S. debt.
That would also drive up consumer rates, because the government would be forced to pay higher rates
to bond investors.
“Consumers might look back on this period six months from now and regret it if they don’t take action,”
says Mona Marimow, senior vice president for LendingTree, a loan comparison website.
Mortgage rates are at historic lows and unlikely to go much lower. The average rate for a 30‐year fixedrate
mortgage for the week ended July 28 was 4.55%, only slightly higher than a week earlier, according
to Freddie Mac. Rates slipped on Friday after the Commerce Department reported that the economy
grew at a lower‐than‐ expected 1.3% in the second quarter.
Borrowers who want to lock in low rates need to act fast, says Keith Gumbinger, vice president of HSH, a
publisher of mortgage data. “If the government does default, it’s going to be hard to lock in an interest
rate,” he says.
How the debt‐ceiling crisis could affect other consumer rates:
Credit cards. Interest rates would likely rise, although not right away, McBride says. Credit card issuers
are required to give you 45 days notice before they raise your interest rate.
Most credit card interest rates are tied to the prime rate, which wouldn’t be affected by an increase in
Treasury rates, he says. However, card issuers would likely increase the margin they add to the prime to
calculate the rate they charge consumers, he says.
You can protect yourself from a rate hike by paying off your balance ‐‐ which makes sense even if the
government doesn’t default, McBride says. “I don’t think there’s ever a good reason to keep a high
credit card balance,” he says.
Certificates of deposit. Savers who hope that higher Treasury rates will boost low CD rates will be
disappointed, McBride says. Those rates won’t improve until banks increase lending, and that’s not
going to happen if there’s a downgrade or default, he says. And if a default causes safety‐seeking
investors to flood banks with cash, McBride adds, rates could fall even more.
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