How to Clean Gutters

As a homeowner, you don't have to spend money hiring help to clean the gutters on your house. It's possible to do the job by yourself, unless of course they have become terribly dirty or clogged and only expert hands can restore their functionality.

Here are a few easy steps that you should follow if you need guidance on how to clean gutters:

Get the Necessary Tools Ready

Before you get begin cleaning out the gutters, you need to be sure you have all the tools that you will need in order to perform this task. For this job, you will need ladders, a pair of rubber gloves, a bucket, a gutter scoop, and a garden hose onto which you will attach a spray nozzle. Once you have put together these tools, you are now good to go.

Remove the Covers of the Gutters

After ensuring that your ladders are firmly in place against the wall, climb up and remove all the covers from the gutters. Note that you should never climb onto the two topmost rungs of the ladders as that would make the ladders very unstable, posing a risk of a serious fall.

Scoop Debris Out

Use the gutter scoop to get out all debris that is in the gutters. To minimize how much more cleaning you will need to do later, place this extracted debris into the bucket that you should have close by for use in this cleaning process. In case you don't have a gutter scoop, use your hands to remove the debris. Remember to keep your hands inside rubber gloves throughout this cleaning exercise, or you could suffer from cuts due to sharp points on the gutters.

Flush All Gutters

Once all the debris has been removed, the next task involves using the hose and spray nozzle. Direct a jet of water that is under pressure to clean out any dirt that could have remained in the gutters once you have removed the debris manually. Remember to avoid hitting the gutters with water at a very straight vertical angle as that could force them to get detached from the roof. Let the water reach the gutters along the normal flow pattern of rain water.

Inspect Down Spouts for Clogs

If water isn't flowing freely down the spouts, check for any clogs in there. You can remove the debris clogging the downspouts by using the hose alone (after removing the nozzle). By spraying water upstream along the down spouts, any debris in there will be dislodged and water will begin flowing without any disruption.

Do Final Checks on the Gutters

Once the gutters are clean and water is flowing freely down the downspouts, your final task is to give the entire system a final check to confirm that everything is as it should be. Ensure that all the gutters are properly secured onto the roof and that there are no rusty or damaged gutters. If everything is satisfactory, put back the covers on the gutters and climb down. Your gutter cleaning job is over!

As you can see from the above description, cleaning the gutters on your house is a fairly simple task. Experts recommend that you should clean your gutters at least twice each year. If you have a lot of trees near the roof of your house, you may have to do this cleaning exercise more often since debris or leaves will accumulate more quickly as compared to a home where there are no big trees near the roof.

Energy-Efficient Building Materials

Building an energy-efficient home is a great idea. Most modern buildings are built with the issues of energy efficiency in mind. There is a wide range of energy-efficient building materials available in the market for builders. Let's take a look at some of the efficient building materials you can use. 

Recycled steel

It only takes six scrap cars to build an average house. The steel beams are more efficient than the wooden ones and can be used for specific designs. The other major benefit is that steel is long lasting and can be used in areas that are prone to high winds and earthquakes. 

Insulated concrete forms

Insulated concrete forms have been in the market for more than fifty years and are getting more popular because of their high energy level efficiency. The concrete can be used in building blocks and free standing walls. 

Plant-based polyurethane foam

Plant-based polyurethane is a safe building material made from natural materials such as hemp, kelp and bamboo. It is has high resistance to heat, moisture and offers great protection to pests and mold. It is far much better than polystyrene and fiberglass that have been used for long. 

Straw bales

This is another resilient energy-efficient building material that's been used for many years for making beds and for roofing. Straw bales have great insulation properties and if it is kept free of moisture it can last for a very long time and bond well to plaster.

Cool roof

Cool roofing technology has been in place for quite sometimes. This technology enhances heat dissipation and lowers your home temperature during the hot days. It is also environmental friendly because of its ability to reduce the heat in the atmosphere. They have high ability to reflect the sunlight, leading to heat reduction in your house.

Structural insulated panels

Structural insulated panels are made from a layer of foam insulation sandwiched between cement panels and plywood. One of its major advantage is that it is fire-resistant, making it effective for foundations, floors and basements. There is a wide range of the materials to choose from, but the level of energy efficiency is the same.

Plastic composite lumber

This lumber is made from wood fiber and waste plastic and can last for many years compared to the conventionally treated wood. In addition, it has high resistance to mold and rot. Plus, it's stronger in the cold and more pliable in the heat compared to plastic building materials.

Low e-windows

Low e-windows- also known as high performance windows- are a perfect substitute for regular glass. They help reduce heat during summer and block infrared radiation. They are coated with metal oxide and help keep your house warm during the cold season.

Vacuum insulation panels

These panels are mostly used for commercial refrigeration units and may be used for general home building in the future. They are made of textured silver rectangle that encloses a core panel in an airtight envelope. This means that there is a reduction of heat loss leading to greener homes.

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Keep the Home Energy Efficient by Installing the Correct Control Layers

If you are a builder, one of your chief concerns should be ensuring the energy efficiency of your homes. This involves using the correct building materials and installing appropriate control layers.

Total control is the key to building a high performance home. The four control layers that determine the performance of your home are: water, air, thermal, and vapor.

It might sound surprising, but many builders still don't understand the properties or uses of various construction materials. For example, many of them don't understand what a house wrap is. All builders understand that a house wrap is a control layer. But what is it that it is supposed to control?

Most builders seem to believe that a house wrap is an air barrier. Some builders believe that it is a vapor retarder. There are also builders who believe that it is a bit of both.

If you are a builder, you should control the following elements in a home.

·         Heat

·         Water

·         Air

·         Vapor

Here is an overview of the materials and technologies that you can use to control these elements:

Controlling heat

You can regulate the flow of heat around the home by using proper insulation. There are many different kinds of insulation materials. Some insulation materials also act as vapor retarders or air barriers.

Controlling air

There are still many builders who believe that you must not air-seal a home too much. But that is not true. The old theory that the house should be able to breathe no longer holds water. As a builder, you need to keep air leakage at the lowest possible level.

Controlling water

This is more important than anything else. If you fail in this department, your house will fail to achieve the desired level of energy efficiency. This is where a house wrap helps. It helps you control water. It is a drainage plane that protects the permeable materials behind it by keeping water away. House wrap isn't the only drainage plane. Several other materials are also available.

No matter what material you choose, you need to control water using all possible means.

Controlling water vapor

So you thought the house wrap was a vapor barrier. It does have some properties of a vapor barrier, but it is not an efficient vapor barrier. The truth is that it is not as effective as a class III vapor retarder. As far as vapor control goes, there are times when you need to control it and then there are times when you should let it flow. When the climate is really cold, you should keep the vapor on the inner side of the wall but not on the outer side.

If the home is situated in a semi-humid climate, you don't need a vapor retarder on the inside or the outside of the walls.

Creating the perfect wall

The perfect wall is one that has got all the control layers in place. By installing all proper control layers, you can keep rain water outside and conditioned air inside. The control layers will also make your home durable, healthy and comfortable. So control the flows.

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Picking a Lot for an Energy-Efficient Home

Building a home that boasts energy-efficient qualities is easier than transforming an already-built home to conserve energy. Building from the ground up ensures that only the best and most efficient features and appliances can be added to the home for maximum energy conservation.

Perhaps the biggest decision when building an energy-efficient home is where you will put the home. Picking a lot for your home involves a few factors that you should be aware of.

How energy-efficient is the lot?

When you scope out building sites, you should measure the potential of the particular lot in terms of energy efficiency. Here are some things to look for and consider:

Solar exposures- Since this is a major key to building energy-efficient homes, you need to figure out what the latitude of the lot is and the sun’s path over a year’s time at that attitude.

Water- Of course homeowners need water to live, so the water situation should be analyzed. How is the water supply? Are there any water problems in the area? Will the home need a well? There are many questions to answer as far as water is concerned.

Prevailing winds- For energy-efficient homes, prevailing winds are very important in ventilation and cooling the home. You want a lot with a great natural breeze in the summer.

Future plans for area- Are you building a home on a lot near train construction or a highway that’s planning on expanding? Find out before you begin construction.

Will local building codes support the home construction?

Before you build an energy-efficient home, you need to find out whether or the area has local building codes that support your plans. To find out, you can ask the local homeowners association or the local building department. You can also get information about the costs for fees and permits as well. It’s a good idea to talk with local contractors and builders to get information and advice on building an energy-efficient home in the area.

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A History of Log Cabins

If you’re building a vacation home, you might consider a log cabin. You just can’t beat the coziness and down-to-earth appeal of a log cabin home! Whether you want to build a vacation home or a major home for you and your family, log cabins are a great investment. They also have a rich history throughout the world.  

 

Log cabins are shelters typically made of logs hewn together. Traditionally, these houses were single roomed or storied. Log cabins are believed to have their original roots in Scandinavia and Eastern Europe and were probably first built in the Bronze Age period. Straight pine and spruce tree trunks in the Scandinavia facilitated construction of the cabins, and this still goes on today.

 

Europeans continued building log cabins as frontier shelters when they migrated and settled in North America. Some historians believe that the settlers built their first cabin in 1638 in New Sweden. Construction of log cabins continued in other colonies.

 

As the early settlers built more formal houses, log cabins served as animal shelters and outdoor stores. Some famous personalities like Abraham Lincoln and Andrew Jackson among others were born in log cabins. Cabins have currently transformed into leisure homes but their interesting history remains unforgotten.

Foundation

Pioneers of log cabins had to choose an ideal site to offer the inhabitants good drainage and access to sunlight. Cabins foundation was set on stones. Large stones were used especially for the corners. More stones were also used along the sill or bottom log for very large cabins. The stone foundations kept the shelters from damp soil. Space between earth and the cabin served as storage. Cabins that were constructed on earth floors needed no stone foundations. Cabin floors were normally made from hard-packed clay.

Walls

Traditional log cabins had walls that were made out of straight tree trunks placed one on top of another. The trunks or logs were later interlocked at the corners and notched at the ends. This made the structures very strong as no nails were used, just like today’s log houses.

 

Complex joints were developed over the decades. Spaces that were left between the trunks and at the joints were sealed using moss or other soft materials from surrounding plants. Small window openings were allowed on the log walls to allow in some light and warmth. A fireplace also existed in the cabin for more warmth which also served as a cook stove.

Roof

As for the roofing, log cabin pioneers used rows of overlapping short boards. The size of the house depended on the length of the tree trunk. Similar sealing was used on roofs to keep away moisture. Traditional log cabins also had smoke allowance which served as chimney.

 

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The Basics of Building Science

We all live in buildings, but how many of us actually understand how these buildings work? As a builder you know how to build a home. But do you know how exactly a home works? Chances are, you don't. Builders and contractors know how to build. Even so, many of them don't understand the fundamental rules of building a home. Don't worry. Building science isn't all that complicated.

Here are the three fundamental rules that govern all buildings:

A building is a system

A house is basically a system consisting of a number of components that interact with one another. Your plumbing, electrical, framing, HVAC - they all work together to create a home. You will hire different contractors to install these systems and in most cases, they are only interested in their work. A plumbing contractor may overlook the impact of their work on the electrical or HVAC system. This is a mistake.

The performance of a home depends upon three elements - building envelope, weather shell and the mechanical systems. The job of the weather shell is to keep the elements out. The building envelope is the boundary between the conditioned space inside and the unconditioned space outside. The building envelope comprises insulation and an air barrier. The building envelope can get compromised in many ways.

The mechanical systems also play a significant role in determining the performance of the home. Besides increasing or decreasing the temperature levels, your cooling and heating systems also affect the pressure and moisture content inside and outside the home. All of these things play an important role in making the home efficient, comfortable and healthy. Make sure that your cooling and heating systems are of the proper size.

Consider the climate

The same house can't be built in all climates with the same specifications. While building the home, you need to consider the weather elements. Vapor barriers that work in one climate zone will not work in another climate zone. This explains why you should pay attention to the climate. The climate can be dry, wet, hot, cold or mixed.

Homes in Miami or Minneapolis will probably need a vapor barrier, but you don't need it in Memphis. The purpose of a vapor barrier is to reduce the diffusion of vapor into the wall cavity. It tends to work in one-way climates. For example, in Miami, the humid air tends to be outside the home, so the vapor retarder/barrier also goes outside. On the other hand In Memphis, the humid air is inside the house for six months and outside the house for the remaining six months. So if you install the barrier inside the house, you will be wrong for half of the year.

Don't forget the rules of thermodynamics

Hot air moves up and cold air moves down. In the same way, moisture tends to move from wet to dry. These are the basic laws of thermodynamics. If you are planning to build against these rules, you need to be extra careful. If you want to control moisture, you should know what climate the home is in. This will help you decide what type of cooling and heating systems you need to install.

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Fire Resistant Siding and Roofing Materials

All buildings can catch fire. But buildings that are built of fire-resistant materials give the residents enough time to escape in the event of a fire. Fire-resistant materials need not necessarily be noncombustible, but they possess properties that slow down the spreading of fire.

Here is a quick overview of fire-resistant siding and roofing materials:

Fiberglass-Based Asphalt Shingles

Asphalt shingles are the least expensive residential roofing materials. They are also fire-resistant. Fiberglass-based shingles offer excellent fire resistance, especially when they are installed with underlayments that comply with fire codes.

Metal Tile

Metal tiles aren't combustible and when they have fire-resistant barrier materials under them, they offer excellent protection from fire. These tiles are lightweight and don't require much maintenance.

Clay Tile

Clay tiles are not only durable but also noncombustible.

Recycled-Rubber Tile

Roofing materials made of recycled rubber are light weight. They are also quite cheap. Better still, they meet tough fire resistance requirements.

Slate

Nothing can beat slate in terms of elegance, beauty and versatility. These tiles are almost indestructible and noncombustible. Slate tiles are heavy, so you need to ensure that your roof is strong enough to support them.

Fiber Cement

Fiber cement shingles have excellent fire resistance. They are made from a mixture of sand, wood and Portland cement. They can withstand high heat for up to 4 hours. If you are planning to use fiber-cement sidings, you need to add gypsum-board underlayments. This will offer maximum protection against fire.

However, you need to remember that you can't get protection from fire by simply cladding your house in fire-resistant roofing and siding materials. If there are cracks or holes in the walls, the embers will find their way inside.  Other inflammable surfaces also increase the risk of fire. So don't forget to enclose soffits and eaves with a fire-retardant trim.

Stone Veneer

Stone veneer is another noncombustible natural material that you can use to wrap your roof. By using fire-rated mortar and repairing cracks periodically, you can prevent the stones from popping off under the heat of a fire.

Exterior Insulation Finish Systems (EIFS)

An EIFS finish does not look much different from stucco. It is created by applying an acrylic cement finish over a fiberglass lath. By adding a foam insulation layer to the back of the cement, you can prevent cracking. Note that some EIFS products don't have fire ratings because the noncombustible materials in them will readily fall off when they are confronted with heat. However, EIFS will not make the underlying wall system vulnerable to fire.

Treated Wood

Natural wood is highly inflammable. However, several roofing and siding companies now sell shingles and clapboards mixed with fire-retardant chemicals. If you use them, you should retreat the wood periodically to retain its fire resistant property because chemicals can leach out over time.

Masonry

Fire retardant stucco walls and bricks offer decent protection from fire provided that they are of the required thickness. While these materials are slightly expensive, they will last decades if they are properly installed and maintained. A layer of gypsum is more than enough to slow down the conduction of heat from your siding to your framing.

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How to Save Money on Construction Costs

If you are building a home, you might have thought of ways to cut costs. There are mainly 3 ways to save time and money on construction costs. First, avoid unnecessary mistakes. Second, cut back on upfront costs. Third, make the home less expensive to occupy.

Before undertaking a home construction project, you should communicate with your contractors. Specify your requirements clearly. Misunderstandings between the builder and the contractor can lead to costly mistakes. Do you want the project to be finished before a certain date? Let the contractor know about your deadline.

Make the home safe

Choose fire resistant materials for building the home. They are not exactly cheap, but they make the home more salable. Many of these materials are combustible, but fire takes long to affect them. This gives occupants enough time to escape. Fire resistant windows in particular are popular with buyers.

Use reclaimed materials

You will perhaps want to explore the possibility of using reclaimed materials in the project. Objects bought from home improvement stores also tend to be less expensive. If you can find a Habitat for Humanity store somewhere near you, you will be able to find good quality cupboards and other fittings for deeply discounted prices. If there are items that you want to procure on your own, you should communicate this with the contractor.

Add sustainable features

Buyers now look for sustainable features that will make the space less expensive to occupy and hence the builder needs to incorporate them into the building. Install water efficient fittings in the bathroom and the kitchen. They will reduce the utility bills of the occupant.

Many builders now install solar panels and home wind turbines. While the upfront costs can be high, they help reduce the energy bills of the homeowner. The builder can also quote a higher price for these homes.

Prefabricated homes

If you really want to save money, you should consider prefabricated homes. Modern prefabricated homes are well-built and energy efficient. Better still, they look stunning. In certain areas, you can construct homes with reclaimed shipping containers.

Reduce labor costs

Labor costs can add up to the cost of construction. Before your workers arrive, make sure that they have everything they need to work with. This includes construction materials and tools. If you make them wait around, you will incur huge losses.

Obtain all necessary permissions

Before starting the project, you have to ensure that you have obtained all necessary permissions. A stop work order can cause costly delays and also invite fines.

Don't compromise on quality

As a builder you will want to save money on building costs, but remember that for the buyer the home is an investment. Hence, opt for fittings and features that will make the home more salable over the years.

Appliances with WaterSense and Energy Star labels are becoming popular with buyers. WaterSense is the measure of an appliance's water efficiency. An appliance needs to be at least 20% more water efficient than conventional appliances to qualify for this label.

Buyers, in particular, are looking for materials that will recoup their cost while they sell the home. Laminates may be less expensive. But hardwood or tile flooring makes the home more salable.

While building the home, saving money alone cannot be the sole objective of the builder. Instead, builders need to look for ways that make the finished project more salable and livable. This involves adding energy efficient features and fittings that recover their cost.

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How to Avoid Common Framing Errors

Simple things can make a big difference. This is particularly true in the home construction industry. It is true that home construction is not a technologically advanced field. We still use more or less the same technologies that we used ten or twenty years ago. However, better building materials are available now and they significantly improve the structural stability and performance of the building.

Here is a quick overview of common framing mistakes that can lead to callbacks and complaints:

Installing sheathing as a single span: Sheathing needs to be installed over 2 or more spans.

Installing strength axis in the wrong dimension: It is generally a good idea to install panels with their strength axis across the supports.

Sheathing that isn't properly supported: If the wooden panels are cut less than 24 inches in width, they will probably deflect over a 24” panel. Since these panels are usually installed on the roof ridges, workers may walk over them during the construction. If the panels are narrower, you will have to support them with edge support clips.

Installing glued laminated timber upside down: These beams tend to be of the unbalanced kind. Generally, different levels of bending stresses are assigned to the tension and compression zones. If you find the label 'Top' on the top lamination, you must ensure that that side of the timber goes up.

Panels that are not properly spaced: When installing panels, make sure you space them properly. Panels made of wood may expand or shrink when there is a difference in the climate. When they are exposed to moisture, they may expand.

If panels are installed with hardly any space between them, expansion will be prevented. This may lead to buckling. To prevent buckling, there should be a gap of 1/8 inches between panel ends and edge joints.

Fasteners that are overdriven: Improper fastening will lead to aesthetic and structural problems. They are the number one cause of call backs.

Inconsistent joist spacing: Make sure that the deflection across the floor is consistent. If not, expect a lot of call-backs from angry customers.

Inconsistent floor gluing

Squeaking is one of the most common complaints about wooden floors. If the floor system is properly glued and nailed there will be no squeaking.

By following the five framing principles given below you can prevent these common mistakes.

·         Wooden panels tend to have a strength direction. If you adhere to this rule, you will be able to prevent most deflections.

·         Since wood has a tendency to expand or contract, you need to ensure that the panels are properly spaced.

·         Make sure that your building practices are consistent. Inconsistent materials, framing and alignment can cause a lot of problems.

·         Most vapor related problems can be prevented by using vapor retarders.

·         The builder or the contractor also needs to ensure that the sheathing is continuous. Continuous sheathing will offer greater resistance against high winds.

Improperly built field notches

If the field notches are made improperly, they may compromise the structural capacity of the framing member.

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Small Lenders to Bear the Brunt of Qualified Mortgage Rules

Small lenders are already struggling with rising interest rates and poor economic conditions. The new mortgage rules will further affect their ability to make a mortgage loan.

The new qualified mortgage rules are designed to fix major problems associated with the mortgage industry. Prior to the housing bust, lenders made loans without properly assessing the repaying capacity of the borrower. Under the new rules, the lenders have a legal responsibility to ensure that borrowers will be able to repay the loan.

Most analysts believe that the new rules will have no long term negative impact on the mortgage industry. However, small lending institutions say the new rules have made them wary of lending because they are afraid of offering loans that do not comply with the guidelines specified by the Consumer Financial Protection Bureau. These lenders are worried that loans that are outside the standards specified by CFPB may be liable to lawsuits filed by unhappy borrowers. Many of them even lament that they can no longer do the loans they did in 2013.

The new 'qualified mortgage' rules specified by CFPB clearly state that the borrower should not have to spend more than 43 percent of their total income on debt. Also the fees charged by the lender cannot exceed 3 percent of the loan amount.

The risks of not complying with these new rules are serious. Even if the lender commits a small mistake in assessing the eligibility of the borrower, they will not be able to sell the mortgage to Freddie Mac or Fannie Mae. This will force more and more lenders to stay within the rules.

The officials at CFPB say that they will closely monitor the impact of the guidelines on the mortgage industry. And if they feel that the new rules have affected the availability of mortgage loans, they will make tweaks here and there.

Large lenders, on the other hand, have said that they will make mortgage loans outside CFPB's guidelines because they have the financial capability to hold these non-qualifying mortgages on their books. These lenders are not afraid of the legal risks of making such a loan.

Many experts believe that the impact of the new rules on the mortgage industry is still not clear. The fate of middle-class borrowers who may fall outside the qualified mortgage guidelines in spite of having decent credit scores is also uncertain.

CFPB officials have made several changes to reduce the impact of the new rules on lending. For example, mortgages made to borrowers whose debt levels exceed 43 percent can still be considered as qualified mortgages if the lender can sell the loans to Freddie Mac or Fannie Mae or get them guaranteed by the FHA. Community lenders who make 500 or fewer loans a year are also allowed to make mortgage loans to consumers with relatively higher debt levels.

Small and midsize lenders have been capturing a greater share of the market as large lending institutions have sort of stopped buying mortgages from brokers. The new rules, however, will affect their ability to dispense loans.

The demand for mortgage, too, has been falling probably because the interest rates are going upward. Some credit unions may also stop making loans in 2014. For a small lending institution the burden of complying with the rules simply isn't easy.

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Is the Construction Industry Gearing Towards a Recovery Phase?

The construction industry has been struggling with recession for a long time. However, now it looks like that the recovery phase is finally here. The Kitchen & Bath Industry Show and International Builders’ Show, which were recently held in Las Vegas, saw large crowds indicating that the age of recovery has eventually arrived. Various global and local factors contributed to the slowdown in the construction industry. The financial meltdown saw many people losing their jobs, lowering their disposable income. All these factors resulted in lower demand across the board and the construction industry was not immune to it either.

 

The industry is definitely showing the signs of recovery. While attending the International Builders’ Show, we decided to check out local communities in the town. We visited various neighborhoods – notably Harmony Homes’ family-oriented Silhouette community. The tour was very comprehensive as we got to witness the polar opposite ends of a spectrum. In January, the NAHB/Wells Fargo Housing Market Index was slashed from 56 to 46, losing 10 points. However, by the time of the trade show in Las Vegas, the sentiments were upbeat again.

 

The contrast between the ends of the spectrum was visible during the show. The higher end of the market held itself up well during 2013 and is continuing to do so. However, the lower end of the market is not so predictable. According to David Straub, Las Vegas division President of Toll Brothers, the company sold 39 properties in the range of mid $500s to mid $600s.

 

The construction industry is now poised for a bounce back, but the indicators are still not clear. We surmise that the industry needs to ask itself certain questions to see where it stands on the recovery curve. It is time for a little introspection on the following lines:

 

The industry needs to predict whether it will see the return of first-time buyers in the market. It also needs to see if the lower end of the market is going to hold itself up steady. The industry also needs to stimulate first-time buyers with more engaging opportunities to avoid high rents.

 

The industry also needs to pay attention to macroeconomic factors. The domestic economy seems to be picking up. However, it is yet to be seen whether there would be enough job creation to see a bounce in house ownership stats. This factor will help shape the future of the construction industry.

Another macro-economic factor to be considered is related to banking and mortgage regulations. These regulations will determine banks’ and mortgage lenders’ willingness to financially back the property purchase decisions.

 

Various states such as Colorado and California are looking to develop master planned communities. These plans will give a boost to the construction industry.

 

Construction industry also needs to scale up. In the past couple of years, the industry has sustained itself by writing down its assets and cost-cutting measures. However, this method is not sustainable. The construction industry needs to see that it will be able to thrive in coming years and retain is profitability. The industry also needs to become more efficient.

 

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Should Investors Obtain a Real Estate License?

Whether real estate investors should get a license or not is debatable. There are arguments both in favor of and against the idea. Many investors start without a license. Some of them obtain it after working in the industry for several years. For many people, the biggest motivation to get a license is that it gives them access to MLS. It also allows them to work more closely on short sales.

The risks are relatively lower when you remain an unlicensed agent. Once you obtain a license, you will be judged by a different standard and you need to follow certain norms. If you are an investor buying a property, you will perhaps just want to remain as an anonymous individual. The risk mainly arises when you find yourself involved in representing the seller(s) in a short sale, although you want to buy the listing. Since you have to follow some fiduciary responsibilities, it is imperative that you act in your best interests. The seller should do the same. This will make the deal less complicated.

Advertising

You will probably have to include your logos and disclosures in your emails. You will also need to follow legal guidelines set by the government. This might cause your mail to land in the trash. If the recipient thinks that you are just another realtor trying to promote their listings, your efforts fail to produce the desired results.

On the other hand, if you are an unlicensed person, you can employ simpler marketing strategies that tend to get better results. That said, there are still ways to advertise your service, even if you are a licensed buyer of properties. However, you will have to ensure that your message complies with the legal regulations.

Alternative solutions

A license will get you access to MLS. However, you don't necessarily have to obtain a license just to have access to MLS. If you are lucky enough, you can connect with a generous realtor who will provide you access to the service through their portal.

If you are trying to list homes, there are several brokerage firms that charge a low fee for adding your listing to the MLS. There are also agents who will readily represent your listing for a fee.

Having a license certainly helps your business and it will not be a hindrance on any of your deals; however, your license can be a burden when you prefer anonymity. On the plus side, if you really want, you can hire another real estate agent as your listing or buyers agent.

In order to figure out whether you need a license or not, you should have a thorough understanding of your business model.  You should decide whether the licensing and accreditation will do more harm than good. Once you get a good understanding of the structure of your business model, weighing your options becomes easier.

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Energy Efficiency Homeowners Care About

Going green has become increasingly popular. Tax credits have encouraged individuals and companies to use more energy efficient products and this has created a giant industry. Add new product innovations that are both energy efficient and cost effective and it is easy to understand the appeal.

Yet consumers are often still confused by industry terms and product effectiveness. What is certain is that, according to the AARP public policy institute, energy costs have increased by over 42% since 2002. As a result consumers are very concerned about their energy costs. Utility bills include electric, gas and water. These costs are often the highest expense for homeowners, after the mortgage payment.

Cost savings are a bigger concern to consumers than saving the planet. If they can make informed decisions that provide a benefit to both, then you have the homeowner’s attention. Consumer promotions like Energy Star ratings are in place to help buyers make financial decisions and home improvements that will lessen environmental impact and save consumers money. Utility companies have even joined the throngs and often offer services that assist customers in recognizing ways to reduce utility bills.

When it comes to home purchases and home sales, energy efficient homes are thought to bring higher prices than homes without energy efficient measures. Items that include energy efficient windows and doors, upgraded insulation and energy efficient appliances top the list of upgrades homeowners find value in.

Other energy efficient measures like solar panels and solar water heaters are associated with higher costs and slower return on investments.  As a result they are less popular upgrades for homeowners. Since they are less available to the average owner, consumers do not have a good understanding about how they operate and how they will save the homeowner money. This impacts buyer interest and willingness to pay for these products.

When marketing a home, it’s important to recognize that consumers are very interested in saving money. While they like the feel good marketing that comes from going green, they are not willing to spend significantly more money in order to reduce the environmental impact. In the end green projects appear to be more about saving greenbacks than saving the environment.

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Buying Apartment Buildings: Look for Larger Units

Investing in a large apartment building is better than investing in smaller units for several reasons.

When you buy a building with a large number of units, you can expect the seller to have complete records. This makes the experience more professional and enjoyable. Also, when the size of the investment is large, you can expect the brokers to guide you through the whole process.

Buying a property can be a stressful experience especially because it involves a lot of steps that you may not be comfortable with. You have to complete several formalities and this wouldn’t be possible without expert advice.

Obvious cost benefits

When the building is large, the cost per unit is relatively low. For instance, the property management fees for larger buildings are relatively lower. Insurance costs may also be lower.

Less closing costs

When you buy a larger building, you pay less money in closing costs. Generally speaking, an appraisal may cost at least 2,500 dollars irrespective of the size of the building. In fact, you will be paying more or less the same amount for both small and large buildings.

The loan doc preparation costs may also be the same for both small and large buildings. The SEC attorney who prepares your legal documents may charge the same amount for preparing documents for units of different sizes. For a building that is worth $2M closing costs may be about 4.5 % of the value of the property. For a much smaller building, the closing costs can amount to 8.5% of sales value.

Better financing

Getting a larger loan is relatively easy. They also have lower interest rates. Better still, large loans almost never require personal guarantees probably because the down payment will be high in this case.

More profits

If you do bigger deals, you will make more profits. So, if you are a real estate investor and your goal is to do 100 units per year, doing one or two large deals is much better than doing ten small deals.

However, there are quite a few challenges that you have to overcome before you can do bigger deals.

The biggest obstacle is convincing yourself that you can do it. Bigger deals might involve more work. Sometimes finding a bigger deal itself can be difficult. But remember that one big deal is equal to several small deals. That means you will have to work many times harder to do several small deals.

You will probably also have to overcome some mental blocks. Many people are afraid of doing bigger deals despite knowing that it is more profitable.

Raising capital

Raising capital can be another problem. In order to undertake big deals, you need more money. You will probably have to borrow money. Actually, this is what discourages many investors from pursuing big deals. 

However, if you are confident and do a bit of search, raising money isn't all that difficult. Many private individuals are willing to offer hard money loans. You just need to find someone with a big enough pocket.

Investing in a bigger apartment building is definitely better than investing in a smaller building. Forget about those duplexes and penthouses. Instead, look for buildings with a large number of units. That is what smart investors do.

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The Basics of Green Building Contracts

Green building opportunities are engaging a lot of attention. This is a result of many factors, such as tax credits, greater regulatory assistance, and increased consumer awareness about environmental conservation. However, green building contracts aren’t as easy-to-understand as conventional building contracts.

What Makes Green Building Contracts Challenging?

For a long time, there was an absence of standard green-construction contracts. As a result, green-building contracts have often been vague, creating a lot of problems for contractors and other involved parties. Being relatively new and still coming to terms with different state-level and national regulations, maintaining uniformity in green-building contracts can be difficult. Recently, this issue has been addressed.

Green-building contracts addressing different types of green risks are now available. The construction industry is still familiarizing itself with this contractual format. Typically, green contracts try to address unique liabilities, responsibilities, and risks associated with green buildings.

We will talk about different aspects of comprehensive risk-management strategy in such contracts. Ideally, the contract should include anticipated/possible risks followed by different clauses and sub-clauses that clarify every aspect of the risks involved. According to the recently-introduced standards, a green-building, risk-management contract should address the following:

Designate responsibilities—establishing accountability is an essential component of building contracts as specific people/departments are designated different job responsibilities. The contract should clearly mention people or parties responsible for failure to achieve green certifications or tax credits. The contract must explain the extent of responsibilities (or risks) of the contractor. Standard and additional risks should be explained. The contract should mention parties responsible for collating and preparing documents for getting green ratings.

Clearly defining green terminology—this includes often-used terms like “green certification” and “sustainability”. These terms don’t have an established, universal definition. Therefore, the contract should define these terms, making them clear for all the concerned parties.

Disclaimer—usually, contractors like to include a disclaimer. This provides more assurance to all the concerned parties. Here, the contractor provides a guarantee for achieving the desired outcomes. The desired outcome can be a green-building certification or the intended energy-efficiency figures. Failure to achieve these outcomes can lead to substantial damages. The disclaimer should state whether the consequential damages will be waived or executed and under what circumstances.

Terms related to project delivery—the contractor should present clear estimates or defined dates by which the green building project will be completed. In the conventional building documentation, contractors often warrant their workmanship. Green contracts are slightly more challenging. Here, contractors can be held responsible for designing flaws that can ruin green-performance ratings.

Liabilities—the contract should clearly address liability in case of a green technology or product failure. The green building niche often uses experimental materials. The success rate of such entities is often not known. Green building systems might even require the collaboration of conventional and new building techniques. The contract should address these challenging issues and assign liability across all the involved parties.

Payment Provisions—the contract should include payment provisions to avoid delays or confusion over payments. Sometimes, the payment schedule is tied to completion of different stages of construction/building. For instance, some contractors might be ready to accept payments when the green certification is received. However, some contractors might not feel comfortable with this clause. It is better to have clear terms about advances, making partial payments, releasing retainage, and final payments.

It has been observed that green building projects that use visual construction often perform better. Key elements of green building modeling are weaved together and then compared with expected outcomes. This makes it easier to gauge the most probable conflicts and create possible resolutions.

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