Today I drove down Payne Avenue, past the home where a natural gas explosion occurred this past Monday morning.  There were three people standing outside the safety gate, with notepads, talking with a Texas Gas Service employee.  I stood there looking at the charred remains, wondering about this man’s life.  A jogger passed with her Border Collie on a leash.   It was one of those surreal moments for me, when you feel like time has stopped and the world is circling around you.

On Monday morning, a man was leaving to go for his morning bike ride when he saw what he described a “swoosh” as his neighbor’s home collapsed.  The owner was killed by the blast that shook the neighbor’s home off its foundation and damaged cars parked in the street.  Two other people were severely injured.

It is reported that Renald Ferrovecchio, the deceased, had reported the smell of gas to the Texas Gas Service Company, more than a month prior.  Others in the Crestview neighborhood also complained of a gas odor.   The blast is now being investigated by the Texas Railroad Commission.

I read that Mr. Ferrovecchio had just finished remodeling his home the week before this tragedy, and planned to lease his home and move closer to his son.

I know firsthand, the hassles and headaches that go along with living in a home while it’s being renovated.   I also know the wonderful satisfaction of seeing it completed, of seeing your vision brought to life.   I wonder if he, like me, sometimes couldn’t wait for tomorrow, for the project to be complete, or to get where he was going.  Then in an instant, after all the work and money that had been put into that little house on Payne, after all the thought and time put into the renovation, it was all gone in an instant.

Today, flowers are accumulating on the fence of the property as a memorial.

“We are here for only a moment, visitors and strangers in the land as our ancestors were before us. Our days on earth are like a passing shadow, gone so soon without a trace.” 1 Chronicles 29:15

I pray that whatever challenge you are presented with today, whether you are stressed about selling your home, you just lost your job, or you’re just completely overwhelmed, I pray that you will be filled with peace and gratitude.

“Let the word of Christ dwell in you richly as you teach and admonish one another with all wisdom, and as you sing psalms, hymns and spiritual songs with gratitude in your hearts to God.”  Colossians 3:16

Natural Gas Safety

Gas in its natural state has no odor, so the gas company adds a chemical called Mercaptan which smells like rotten eggs.

If you smell an unexplained odor of rotten eggs, hear a hissing noise, see water in a pond bubbling, or dirt spraying up into the air, these are all warning signs that there may be a gas leak.  Even making a phone call is enough current to spark a blast.  Move far away from the area before calling for help.

http://www.texasgasservice.com/Safety/NaturalGasSafety/IfYouSmellGas.aspx

January, 2012

While this January is like any other, packed with resolutions and short lived focus (it amazed me to see how many people were at the gym last night!); its also quite possibly the end of electric costs as we’ve known them since 1994. Austin Energy has proposed a 13% increase in base electric rates. Having held five public meetings in September and October, the Council-appointed Electric Utility Commission received extensive public feedback concerning the proposed rate increase and how it will affect all Austin residents, including low income customers, schools, worship facilities and businesses. 

With this in mind, not to mention our global climate crisis, how about adding some new resolutions for 2012?  Every ant in the mound has a job.  Do yours and cut energy costs in your home this year to save a little money and take it easy on Old Mother Nature. 

• Become a light switch Nazi
• Make sure to unplug your small appliances that are not in use (toaster, coffee pot, etc.)
• Limit long, hot bubble baths to those days when you need Calgon.  Opt for a shower with a low-flow showerhead.  (Also a cold shower now and then is good for the soul)
• Rock, paper, AIR DRY!  Beats machine every time.
• Keep the doors closed when you are heating or cooling your home
• Replace weatherstripping to prevent air leaks. 
• Lower your water heater thermostate to 120 degrees. 
• Turn off the water when you are brushing your teeth.

Thinking of investing in some home improvement in 2012?  Consider the following:

1. Replace old or out of date appliances with Energy Star certified appliances.
2. Replace your duct work in the attic.
3. Install a new, more efficient water heater (like an “on-demand” water heater)
4. Install double-paned windows in place of older, single-paned windows, or add storm shutters to cover single-paned windows

Visit www.energysavers.gov for tips on finding the right contractor.

If you are building a new home, make sure to add foam insulation to the attic and exterior walls and decrease your energy usage by 30-40%.

Below is an example of foam insulation in a JKIRSTEN home, currently for sale, due to be completed at the end of February. (http://www.youraustinexpert.com/listing/mlsid/13/propertyid/6103117/)

Foam insulation, 4414 Lareina Dr.

No matter what your plans are this year to shave the extra cents from your energy bill, there are many ways to make it happen.  Treehouse, a local home improvement store dedicated to smart, green, and sustainable living, offers products, services, and classes to help aid your move to GREEN!

For more information and energy saving tips, visit www.energysavers.gov. You can also visit www.rates.austinenergy.com for more information or to leave a question or comment about rising energy rates for Austin Residents.

Happy New Year! 

2122 Hancock #103, 945 square feet, 2 bed, 1.5 bath, $132,250

Lowest price per square foot in the complex, right next door to the public library and across the street from Jorge’s Restaurant.  One block to the UT and downtown bus route.  This complex is FHA approved. 

Are you familiar with the Mortgage Credit Certificate program available to many first time home buyers? 

An MCC reduces the amount of federal income tax you pay, giving you more available income to qualify for a mortgage loan.  This means that fewer tax dollars will be withheld from your regular paycheck, increasing your take home pay.  The MCC is valid for the life of your loan as long as you live in the home. 

Please contact me if you’d like additional information, jolie@jkrealestategroup.com

Did you know that insurance companies now look at credit scores?  

According to Fair, Isaac & Company ( a provider of consumer credit scoring models and formulas, www.fairisaac.com ) insurance companies assess and weigh these factors:

30% -  How Much You Owe  

15% – Length of Credit History   

35% – Payment History (e.g. late payments, foreclosures…) 

10% – Types of Credit  (e.g. retail, credit cards, finance companies)  

10% – New Credit (how long its been since you’ve opened a new account) 

If you have a good or great credit scores, it is likely that your homeowner’s insurance rate will be lower. If your credit scores are sub-standard, you need to do two things: (1) work on repairing your credit (an excellent book: Credit Repair, by Robin Leonard & Deanne Loonin); and (2) shop around for different lenders and different homeowner’s insurance providers. You can also lower your rate by raising your deductible amount.

If you need to repair your credit, keep in mind that:  

1. You are not alone.
2. You have legal rights.
3. You can do it by yourself without paying high fees for an attorney or credit repair clinic.
4. Nobody’s credit is too “poor” to repair.
5. The first step is to set a budget and stick to it.
6. The second step is to cut up all or most of your credit cards. 

 Do a credit check on yourself once per year to stay on top of your credit scores and take the appropriate steps to improve your credit history and lower your homeowner’s insurance rates. The three major credit bureaus who can provide you with information on your credit history are: 

1. Equifax (www.equifax.com)
2. TransUnion (www.tuc.com)
3. Experian (www.experian.com)  

Contact me if you would like to find out how much you might save if you moved to a less expensive home (which many people are doing).  I can also set up a free consultation for you with my preferred lender to evaluate whether re-financing is also an option.

A short sale can be an excellent solution for homeowners who need to sell, and who owe more on their home than the home is worth. In the past, it was rare for a bank or lender to accept a short sale. Today, however, due to overwhelming market changes, banks and lenders have become much more negotiable when it comes to these transactions. Recent changes in corporate policy and the Obama administration have also improved the chances of getting a short sale approved.

But to be technical, here’s a more official definition:

• A homeowner is ‘short’ when the amount owed on his/her property is higher than current market value.
• A short sale occurs when a negotiation is entered into with the homeowner’s mortgage company (or companies) to accept less than the full balance of the loan at closing. A buyer closes on the property, and the property is then ‘sold short’ of the total value of the mortgage.

For homeowners to qualify for a short sale, they must fall into all of the following circumstances:

• Financial Hardship – There is a situation causing you to have trouble affording your mortgage.
• Monthly Income Shortfall – In other words: “You have more month than money.” A lender will want to see that you cannot afford, or soon will not be able to afford your mortgage.
• Insolvency – The lender will want to see that you do not have significant liquid assets that would allow you to pay down your mortgage.

This seems simple enough, but it is a complicated process that takes the expertise of experienced professionals.

Many people will drive by and make a decision to mark a home off the list based solely on the exterior. If the yard isn’t well maintained, the buyer might question the overall care that has been taken of the home itself.  Remove any broken pots, debris, weeds etc.  Keep the lawn mowed and edged at all times. Consider hiring a professional landscaper.

Repaint or refinish the front door and install a new handle/lock set.  If you have a basic steel front door that has been dented, consider replacing it. 

Place an inviting door mat in front of the door and a splash of colorful plants.  If there is space, place a large planter spilling over with healthy plants on each side of the door.

Remove 50% of your belongings and put them in storage.  Photos and other personal memorabilia should be put away.  Pay particular attention to closets.  Also, clear the refrigerator of magnets, photos and notes.

Clean house from top to bottom, including baseboards, ceiling fans, window treatments, air conditioner vents.

Have windows professionally cleaned.  You can do this yourself, but make sure to get the interior and exterior and clean the windows tracts as well.

Replace AC filter.

Hire an electrician and plumber for a couple of hours to look over your electrical services, wrap or fix loose wires, fix any faulty outlets, and check for and fix any water leaks.

Scrub tile grout and bleach if necessary.

Have carpet professionally cleaned.

Paint walls and ceiling a light neutral color. A fresh coat of paint makes everything feel new and clean.

Replace old outlet covers and light switches.

Update lighting fixtures and install bright, energy-efficient light bulbs.

Replace the kitchen and bathroom faucet sets.

Update old kitchen appliances, making sure the color is consistent.

Paint Cabinets, or refinish the cabinet boxes and then add brand new doors and drawers.

Add new cabinet pulls. 

Replace the toilet seats.

Buy a new fabric shower curtain.  I prefer a solid color to make the room look bigger.  White, with a bit of a fabric pattern is my first choice.

Update the sink unit if necessary.  There are affordable sink/counter units with drawers etc. that are very affordable and easy to install at Home Depot or Lowes.

Consider hiring someone to resurface the tub if it’s stained cast iron.  In my experience, this costs around $300 or less, and is well worth it. 

Tile the bathroom floor using smaller tiles if the room is small to expand it visually.

Once your house is listed, turn every light on in your home and open curtains/blinds every time you leave the house and keep the temperature of your house at a comfortable setting, in case there is a last minute showing.  Also, make sure to have all the beds made and the kitchen sink and counter clear at all times.

If you have notice before a showing, remove pet bowls and litter boxes if applicable.  Turn on ceiling fans (the movement is good energy).  Leave the radio your favorite station at a low volume.

Be ready to leave your house within a 30 minute window if necessary.  Never turn away a potential buyer because it’s not a good time.  If there is not time to make the beds etc., it is still better to let them see the home as it is, than to ask them to come back another time.  When a qualified buyer is out looking at homes in your area, assume that they are going to write a contract that day.  You want your house on the ballot.

Uncle Sam helps you in three ways when you own your home. 

1. The purchase
When buying your own home, most of the expenses are not tax deductible. But there is one exception that is worth finding.  The IRS says you can deduct interest in the year that it is paid, and that is usually part of each monthly loan payment. In addition, if the day you purchase is on any day other than the first of the month, you will likely pay a charge for “daily interest” between the day of closing and the end of the month. Look on line 901 of your HUD settlement statement.  Much more importantly, the IRS says that, in most cases, loan discount points and origination fees are tax deductible to the buyer, regardless of who pays them. Look at lines 801 and 802 of your settlement statement and see if you hit the jackpot. This is a particularly unusual deduction because you get the benefit even if the seller paid your closing costs. And because origination fees of 1% and more are common, this can amount to a lot of cash.

2. Mortgage interest
In general, you can deduct interest charged on a loan used to acquire or improve your principal residence in the year that it is paid. In the early years of a loan, most of your monthly payment is interest, so this can really add up. If you are in a 28% federal tax bracket, this can have the effect of lowering your borrowing costs by almost a third, depending on which state you live in. This is truly nothing more than a subsidy to home owners, and it’s a very popular deduction.  In addition, you can always deduct interest on an additional $100,000 of mortgage debt, which can be used for any purpose. This is called the “Home Equity Loan” exception, and it allows you to tap into your home equity for any purpose. This gives home owners the ability to do what is called “debt-shifting.” For example, if you live in an apartment and have a credit card balance of $10,000 at 18% interest, none of that interest would be deductible. But if you bought a house, obtained a home equity loan for $10,000 and paid off the credit card, then ALL of the interest expense becomes automatically deductible. Furthermore, the rate on the home equity loan is likely to be around prime plus one or two, usually much lower than credit card rates. This same technique works with any and all personal debt, from car loans to consolidation loans – with only one hitch. In every home equity loan, you have pledged your house as collateral for the loan. If you fail to pay the payments as agreed, you could lose your house to foreclosure. So be careful in using this technique.

3. The sale
This is the best. In fact, I can hardly believe this myself. Here’s how it works:  If you have owned and occupied your principal residence for at least two of the past five years, you can earn up to $500,000 on the sale of that house and pay no federal income tax whatsoever. That’s assuming you are married – singles get up to $250,000 tax free. And here comes the kicker: You can do this as often as every two years for the rest of your life. This is as good an excuse for getting married as I have ever heard. Buy a fixer-upper in an up and coming neighborhood, work on it nights and weekends for two years, then sell it at a nice profit and pocket the cash, totally free of federal taxes. And most states recognize the federal exclusion, so you put the cash away totally tax free. You don’t have to re-invest, you don’t have to be age 55, and you can do this every two years forever. No, I’m not kidding.  The one restriction is that you MUST own and occupy the house as your principal residence, so don’t try this on a rental property by pretending you live there when you don’t. And there are some unclear rules about how you can take a partial exclusion if you live there less than two years, but we don’t really know what they mean yet, so I recommend you stay there two years.  Many of these benefits came into being with the 1997 tax law, but lots of folks are just finding out about them now, so buy and sell to your heart’s content. Just don’t plan on staying forever!

Experts say Austin is uniquely positioned for housing to rebound.  Click on the link below for the full article.

Home Builders Get Ready