Lifestyles of the twenty-first century have radically changed from fifty years ago. The clamor for big lots and single-family houses has been replaced by a demand for condominiums and planned communities (generically called “homeowner associations” or HOAs). The growth of HOAs has been nothing short of phenomenal in the last decade. In many urban areas, upwards of 75 percent of all new residential housing is in the form of a homeowner association. Mixed used HOAs combine residential and commercial together. For instance, retail and office units often occupy street level space while residential units occupy upper floors.

HOAs are essentially governmental corporations controlled by the members through an elected board of directors. The HOA has authority to make and enforce rules and regulations and to collect HOA fees from the members to support the HOA operation and maintenance responsibilities. Like the IRS, the HOA has significant power to enforce its will through liens and, in extreme cases, foreclosure. When homeowner associations are properly conceived and constructed, they work very well. When they are haphazardly implemented, trouble and discontent follows. The success or failure of an HOA begins at the beginning … with the developer. (more…)

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More and more often, natural disasters from summer hurricanes to winter snow storms don’t blow through without leaving injuries and deaths in their wake — not from the event itself, but from misusing power generators to keep the lights on when the power goes out. After Hurricane Katrina left much of the Gulf Coast in the dark last year, a dozen deaths and scores of carbon monoxide (CO) poisonings were blamed on portable gas-fired generators in the hands of those unfamiliar with their proper use.

An early winter snowstorm in the Buffalo, NY area just months ago turned out the lights for hundreds of thousands of residents and half the six storm-related deaths were attributed to CO poisoning from gas fired portable generators. Area hospitals reported dozens of cases of CO poisonings caused by the appliances. After a snow storm with hurricane force winds knocked out power to 1.5 million customers in the Pacific Northwest, including homes and businesses, hospital officials said CO poisonings reached “epidemic” levels. Just a week before Christmas, at least one man died of inhaling the colorless, odorless gas, more than a hundred were treated at area hospitals and dozens were sent to pressurized hyperbaric chambers which forced oxygen into their blood. (more…)

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More American homeowners are slipping behind on their monthly mortgage payments, especially those who had subprime credit histories and scores when they applied for their loans. Roughly one of every 20 homeowners with a mortgage — 4.7 percent — was at least 30 days late during the third quarter, according to the Mortgage Bankers Association’s national delinquency survey released last week. The survey examined payment performances on over 42.6 million active home mortgages.

Though the overall trend in delinquencies is upward, Mortgage Bankers Association chief economist Doug Duncan said the slightly higher rates were expected as the housing boom wound down. They are also well below the recent high points reached during the 2001-2002 period. The subprime late payment jumps, however, “were noticeably larger” than projected, “particularly for subprime adjustable rate mortgages.” The reason for the spike: “subprime borrowers are more likely to be susceptible to the cumulative increases in (short-term) rates we’ve experienced, and the slowing of home price appreciation that has resulted,” said Duncan. But “it is important to remember,” he added, “that delinquency and foreclosure rates have been quite low the last two years.” The national foreclosure rate of 1.05 percent during the third quarter was up slightly compared with the same period the year before. But today’s rate is well below the 1.6 percent level reached in early 2002, when subprime foreclosures hit 8 percent. (more…)

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Despite the recent fluctuations in real-estate prices nationwide and sale prices that have fallen short of sellers’ expectations, homeownership has proved to be a good long-term investment, financial experts agree. Buying a home is the largest investment most people will ever make, said Shrikant Nadkarni, a certified public accountant, certified financial planner and shareholder at WithumSmith+Brown PC’s Somerville office. “Owning a home over a long period of time is generally a good investment idea,” Nadkarni said. “It brings financial obligations and forces savings through paying down the mortgage while building equity.”

Homeowners, though, have to be mindful of tax savings from mortgage interest and property taxes, and costs of things needed to keep a house in good condition, like reroofing, repainting and updating appliances, aAnd timing and market conditions are key to whether buying a home will end up being a profitable endeavor, as history shows. People who bought in the 1980s had to wait until 1998 to match the 1988 peak-of-market prices. Recent price downturns are nothing new in real estate. But people are cautioned people about the more exotic mortgages available. which enable people to buy with no money down or with adjustable rates (ARMs). When the housing prices do dip a bit this is going to be a deadly thing. . . . Their monthly payments will go up. It’s just too bad that the criteria is not a little more stringent to make sure that these people can afford to continue with these houses. Surely people should buy, but they should be qualified to buy. (more…)

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Early next year my husband Gerry and I will reach two milestones in our finances: Our mortgage’s outstanding balance will drop below $100,000 and, more significantly, more of our monthly payment will go toward principal than interest. With the passing of both of these milestones, Gerry and I will be that much closer to paying off our 20-year fixed-rate mortgage, a process we’re hastening by making additional principal payments of $195 a month. (Why the odd figure? I’ll get to that later; the short story is that it is part of $395 a month in spare cash we debated over where to invest. )

Some people believe paying off a mortgage is a stupid move, and would advise us to forgo the mortgage prepayments and invest that $395 a month elsewhere. This school of thought holds that the wisest financial move you can make is to get mortgages with the lowest monthly payments possible — refinancing as rates decline — and never pay off the loans, a strategy that improves your cash-flow and lets you benefit from potential home-price appreciation. (more…)

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Of all the confusing and expensive things about buying a house or refinancing a mortgage — and there are plenty — title insurance just might take the prize. “A lot of customers don’t understand title insurance,” said Samuel Ingram, president and CEO of myclosingspace.com, a Wall company that offers title insurance and other house-closing services. “It’s the largest component of your closing costs, and yet people don’t know anything about it.”

They should start learning about it, because title insurance, which protects homeowners’ property ownership rights, is drawing scrutiny from state regulators and other critics. They charge that: title insurance prices — and profits — have unfairly soared, because they’re based on house prices, which skyrocketed from 2000 to 2005. “The real estate boom has been very profitable for title insurers,” said J. Robert Hunter, director of insurance for the Consumer Federation of America. (more…)

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Trump-Style Negotiation by George Ross (John Wiley and Sons, $24.95). This book offers insights into Donald J. Trump’s big-thinking negotiation style, which leaves the contract details to his trusted adviser, George Ross. Only serious real-estate buyers, sellers, real-estate agents and investors will study this well-written book that reveals negotiation tactics not found elsewhere, illustrated with many actual examples from Trump acquisitions.

The Automatic Millionaire Homeowner by David Bach (Broadway Books, $19.95). If you could read only one real-estate book, whether you are a renter considering a home purchase, a current homeowner, a seasoned realty investor or a real-estate agent, this is the book for you because it shows how homeownership can lead to wealth. The book’s two themes are a) renters can become millionaires by investing in their first house or condo and b) that residence can become the foundation for a better home or more investment property in future years. (more…)

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The cost of affordable rental housing has risen 28 percent in the past seven years, far outpacing the wages of those who need it most, according to a new report released Tuesday. “Out of Reach,” the annual report of the National Low Income Housing Coalition (NLIHC), found that housing affordability is most difficult for minimum-wage earners but is also tough for those who earned the median hourly wage ($14.57) last year. In 2006, what the NLIHC calls the “national housing wage” rose to $16.31 for a two-bedroom rental, from $15.78 last year.

The report found that a minimum-wage earner making $10,712 a year cannot afford a one-bedroom home based on fair market rents anywhere in the country. To do that, he or she would need to earn at least $28,475, NLIHC calculated. And two-bedroom homes are out of reach even for families with two minimum-wage earners making $21,424 annually. For that, they’d need to make $33,925. (more…)

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For two enterprising couples, gingerbread became a relocation inspiration on a grand scale that extended well beyond holiday connections; sweet and spicy gingerbread baking emerged as the signature touch in Lynne and Peter Van Wyck’s transplanted venture on the banks of Ontario’s well-named Grand River, elaborate gingerbread wood-carved trim was part of the attraction for the relocation of Bermudians Alan Barker and Libby Rego to Wolfville, Nova Scotia.

Gingerbread played a different role in this Nova Scotian attraction. ‘Gingerbread’ is also the name given to the intricately-carved decorative wood trim which traditionally adorned roof edges and porches of Victorian houses. Barker and Libby Rego were drawn to a property that was defined by its ornate woodwork. Originally the 1893 carriage house for a neighbouring historic inn, it was converted into a family home in the 1980’s. The owner then transformed the building into the gingerbread wonder which became the Gingerbread House Inn. “The [Inn] does not look that big from the front and people are taken by surprise,” said Barker. “This is not a typical bed and breakfast where you peel off and go down a hall, one room here, one room there, and you fight for the remote. Our 4 suites with hot tubs in the rooms are the only ones in Nova Scotia and they have private entrances. The other 3 rooms have Jacuzzis.” (more…)

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We have purchased several single family homes, and our lender has always insisted that we obtain a hazard insurance policy before settlement. We are about to purchase our first condominium unit, and our real estate agent has advised that we do not need any insurance, since the entire association is covered under what they call a master policy. Is our agent correct?

This is your space; this is where you live; you own it. You pay real estate tax on your unit and can obtain a mortgage loan using your unit as security. In order to determine what is your space, you have to read your Declaration. Additionally, the units will be shown on the condominium Plat and Plans. Limited Common Elements is a common element and is reserved exclusively for use by one or more, but less than all, of the unit owners in the condominium. Limited Common Elements may include balconies, roof decks, storage areas and parking spaces. The Declaration will define Limited Common Elements and the Plats should show where in the complex they are located. (more…)

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