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Volume 1 Issue 3 June 2014

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Letter from the Editors Home shopping, like riding a rollercoaster, can be exhilarating and a bit nerve racking at the same time. You want the perfect home but don’t want to overpay for it. In this issue, we share tips and ideas for selecting the right home at the right price so you don’t get caught in a pickle. For the weekend job warriors, we’ve published several articles for home improvement. Window shopping can be daunting unless you know about window ratings and the importance of R-Value then it becomes a cinch walking into your neighborhood store and knowing the right questions to ask.

Brett Felz Realtor & Agent Wizard 303-531-0320 bfelz@sellstateadvisor.com

Additionally, if you’re making small or big upgrades, you’ll find some helpful hints about upgrading your roof with the right materials and color and if it makes sense to install a tankless water heater to save on your energy bills. And we haven’t forgotten the kids! You can put those stacks of old magazines to good use and keep ‘em occupied for hours! We share some fun ideas that help recycle the magazines so you’re cleaning up and involving your children for some great family bonding time. Feel free to contact us if you have questions or would like your friends and family added to our distribution list.

Bob Friel The Money Man 303-459-2298 bfriel@thefederalsavingsbank.com

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CONTENTS 4. Evaluation Tips to Help You Know If the Price is Right

6. Is a Short Sale, Foreclosure or New Home the Right Choice?

8. What’s Over Your Head

10. Importance of R-Value in Home Improvement

12. Review Window Ratings for Ideal Home Designing

13 Recycling Magazines with Kids

14. Is It Worth It to Install a Tankless Water Heater?

This magazine is published monthly. Entire contents are copyright protected under law where applicable. All Rights Reserved. Reproduction or use of content in any manner without permission is strictly prohibited. All images are copyright protection of 123RF.com and its photographers.

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Evaluation Tips to Help You Know If the Price is Right So you want to buy your first home? Well, that is the best decision you have ever made. However, because you are in the home buying process for the first time, just how do you know you are not paying more than what the house is worth?

Research Comparable Properties A comparable property, normally referred to as comp, refers to a property that has similar conditions, size, neighborhood as well as amenities. One of the ways of how to know a 4

good offer is to see how the price of the house you have set sights on compares with comparable properties. Is the house significantly less expensive compared to nicer or larger properties? Is the property more expensive than less attractive or smaller properties? To get accurate and latest information on comparable properties, get in touch with your estate agent.

Comparable Properties on the Market Home prices, while they may vary, tend to be in a certain range. Make actual visits to

the comps currently on sale and see how their conditions, amenities and sizes compare to the property that you are looking to buy. Compare their prices to know what offer is fairer. Any reasonable seller knows that for them to be competitive, they have to price their homes fairly. This will give you a hint as to whether the offer you received was a fair one or whether you were being overcharged.

Appraised Value & Home Inspection Reports Having signed the contract, your lender will commission experts to


appraise the property. The lender does this because they want to know that the money they lend you is safe. They want to be sure that should you default in payment, they can sell the house and recover their money. Look at the appraisal value: is it less than what you are being charged? If yes, then you are being ripped off. In fact, your lender cannot finance the house if they know that the seller is overpricing it. Also, a home inspection is another indicator of whether you get a fair price or not. In case the property requires a lot of repairing, ask the property seller to do the repairs or bring the price down so that you can repair the house yourself.

Is It For-Sale-By-Owner? Abbreviated as FSBO, this is a type of property where the seller is selling without a real estate agent. It is supposed to be cheaper than that in which a real estate agent is involved because it does not include an agent’s fee (6% on average). FSBOs have another problem in the sense that the price the seller set may not have been with the help of an agent so it’s very possible that the seller overprices the house.

Consider Opinions of Your Real Estate Agent Thanks to years of experience, your agent can tell if you are getting a raw deal or a fair one on the property. The simple thing is to ask them to also give their input. This way, you can avoid paying too much.

Expected Appreciation In most cases, the price of the house is influenced by your neighborhood’s future prospects. Developments like building of a major mall, construction of roads in the neighborhood or a big company coming into the area mean that there are good prospects of the area appreciating in future. Also, check to see if there are plans to build a new school or add more roads as these may be positive signs.

However, if gas stations and grocery stores are moving out of the area, the price of the home should be on the lower side. You might reconsider your decision to buy into such an area. If more houses are being developed in the area, this could mean one of two things. The first could be that the neighborhood is hot and that it might be in demand in the future. Also, more houses can mean oversupply, something that will lower the price of your home in future. It can be difficult to tell whether the price is right for the home you want to buy especially if it is your first time to buy a home. The best thing is upon identifying a home for sale you need to do your research to know whether you have a good offer and if it’s right for you.

Also, it might just be that the seller might have disagreed with the suggestion of the agent with regard to the right price of the house, and this is why the seller decided to ditch the agent. Any of the situations above will only mean that the house is overpriced. 5


Is a Short Sale, Foreclosure or New Home the Right Choice? When you are house hunting, there are different types of properties to consider: •

Foreclosures

Short Sales

New Homes

Getting the best deal depends on the status of the market and how long you’re willing to wait to buy the house. When housing inventory is packed with short sales, foreclosures and new homes sometimes you can find sellers anxious to make a deal.

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It’s not true that every bankowned foreclosure is sold at a large discount or that every new home builder is slashing prices.

House prices are dependent on market dynamics. You should ask yourself how much you’re ready to invest in a home.

When all the different factors have been taken into consideration, it’s possible the best deal for you could be buying an existing house referred as a resale so make sure you don’t cut out any house hunting choices too early.

Short Sales

In order to maximize how far your money can go with buying a house, it’s essential to understand the market.

Short sales can offer some of the best deals available when you’re looking at buying a house.

This is where the seller owes a higher amount on the mortgage than the value of the home, and the lender accepts a lower price for the property in order to achieve a sale.


Despite the fact that government programs and lenders are attempting to hasten the process required to finish a short sale, it’s still possible for buyers to wait months, only to find out that they’re not getting the home. That’s partly why short sales are discounted, there’s a level of uncertainty for the eager house hunting buyer. In comparison to traditional sales, short sales are generally discounted by around 5-8%.

Bank-Owned Properties These are foreclosures that have been reclaimed by a bank.

They are usually sold at a reasonable discount, but the size of the discount depends on the market. The typical discount that’s applied to bank-owned properties, in comparison to traditionally sold homes, is between 20-30%. There are a few statistics that have been measured by different researchers on this subject, but that’s the general conclusion. There’s multiple reasons why there is a lower price compared to traditional homes.

The seller is a bank so they want to sell the property as soon as possible compared to a home owner who has a particular price in mind and they will wait around longer in the market. Another reason for a cheaper price is that foreclosures can be in poor condition since the previous owner wasn’t able to afford the mortgage. The main thing to look for when buying a bank-owned property is the level of maintenance and repair that it will need and if the repairs help the value of the property.

New Homes The supply of new homes in some markets is falling, which has led to a price stabilization. That means that it’s harder than usual to find a bargain. The flexibility of builders’ pricing has lowered, and they’re less likely to negotiate. There’s usually a 20% premium paid on new homes, in comparison to existing, traditional homes. This varies with a few different factors, primarily the location of the home. Builders are, of course, still willing to find alternative measures to ensure a sale when you’re looking at buying a house. They might throw in tempting features, like a finished basement, in order to sell their home. If the lowest price is what you want, this may not be your best option.

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What’s Over Your Head? Selecting the Right Materials & Color Does your roof need to be replaced? It can be a difficult choice when deciding the color and which materials to use. Picking the wrong color can cause regret for the duration of time you reside in your home and choosing the right roof is not only important for aesthetic reasons, but it may also impact your energy bills and home’s value.

Here are different types of roofing shingles that you may opt for depending on the climatic conditions of your area. •

Asphalt shingles is the most popular roofing material. It comes in a variety of texture and colors to match different needs and taste.

Custom made asphalt shingles enhance the unique look of custom homes. On the other hand, standard asphalt shingles are very economical as compared to other roofing materials.

Roofing Materials There are numerous options when investing into a new roof. Your decision can be easier when you understand how to pick the best roofing materials. 8

Synthetic slate tiles & shake shingles are are highly durable and cheaper when compared to genuine slate

tiles. They also prevent mildew and mold growth. •

Metal shingles offer unique and durable options that most homeowners look for in roofing shingles. It can be the ultimate protection against harsh weather conditions.

Energy efficiency Going green helps you save money by reducing your utility bills and enhancing your home’s overall appeal. Some roofing materials are better insulators than others and can help air conditioning units run less frequently.


Tile is an ideal option for energy efficient roofing materials in some states. If you want something more economical you can go for cedar shingles, they are naturally denser and insulating wood-types.

The Right Roof Color Most roofing materials come in multiple colors, therefore you should consider the style and siding of your home when making your decision.

Consider the Climate Where you reside will influence your roof color choice since it can affect your energy bills drastically. Temperatures in your attic can be influenced by your roof color by 20-40degrees; this means it can make a huge difference in your home’s heating & cooling aspects. There are perfect roof colors for both cold and warm climates. For instance, lighter shingles can reflect sunlight and keep your home’s temperature cool whereas dark-colored shingles are good heat absorbers and keep houses at warm temperatures. If you reside in extremely hot or cold areas, you can consider these facts to help save on your utility bills.

Color Matching The color of your roof should match other exterior elements

of your home. Your roof color should coordinate with elements such as siding, window shutters, pillars, garage door e.t.c .

A subtle brown or dark gray is suitable for such homes. Avoid weird colors or patchy styles such as reddish pink.

By taking your time to evaluate which roof color will match these elements of your home, you will come up with a perfect blend of colors that will create harmony.

The key is to maintain simplicity when choosing colors for stone or brick homes.

Some examples of roof colors that blend well:

Your home’s architectural style will dictate whether you should pick a neutral or bright color.

A light green slate roof that matches the color of your window shutters embraces a countryside exterior.

A fine orange clay-tiled roof on a Mediterranean, French country or Spanish style home.

A forest green metal roof on cottage-style homes with coordinating siding color.

Stone or Brick Homes Stone homes, brick homes or a combination of both look wonderful with custom-colored roofs.

Architectural Style

If you have a Spanish-style home that is white in color, you can opt for a black or dark gray roof. You don’t want to choose brown or dark orange since these colors will make the roof stand out much more than the house itself. Picking a color for your roof shouldn’t be done on impulse. Take enough time and consult several experts before making your choice. Whether you like asphalt or metal shingles, you will find a roof color to match your beautiful home. 9


Importance Of R-Value In Home Improvement If you are thinking of doing some home improvements that involve envelope upgrade, insulation and windows, then you need to know the significance of the R-value before planning anything. Understanding the importance of R-value is essential so you can better understand how each part of the home improvement fits in the overall picture.

R-value – What Exactly Is It? R-value is important for the construction industry since it is the measurement of an item’s thermal resistance. It is related to the U-value; except the U-value is an inverse measurement of the R-value. There are plenty of ways how heat may be transferred; it can be through radiation, convection and conduction. The R-value, U-value and heat conduction are basics for any building-related classes. However, what does these values and concepts mean to the common homeowners?

What It Means For homeowners who are planning to do some home improvements in the near future, R-value is something that you need to consider in every building material, such as doors, dry walls and wood studs. The R-value is typically found in the building material’s packaging or tag.

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The Role of U-Value As stated before, the U-value is the inverse of the R-value, and it is not as commonly seen in the packaging when compared to the R-value. U-value is often a measurement that has great importance when you are dealing with doors and windows. The primary reason you can always find the U-value in doors and windows is because there is an industry standard that every building should adhere to. This means that every home improvement or construction,

the contractors or builders must check the U-value, and other values, so it will be up to the building code of the state; otherwise, they would run into problems with the law. Furthermore, when looking at the U-value, the smaller the number, the better it is.

Compare U-Value and R-Value As mentioned earlier, the U-value is the inverse of the R-value. This means that if a window has .30 U–value, then its R-value is 3.3. Now all you have to do is


compare the number to the overall building envelope to see if it is a good performing window or a poor one.

Resisting Heat Flow For professionals who are dealing with the construction or home improvement work in your home, the R-value allows them to have a better picture of how the material can resist heat flow. Resisting heat flow also works both ways. It gives you an idea on how the material is going to keep the heat within your home, and it also gives you an idea on how it prevents heat from going inside the house (important for areas with cold winters or cool climate). Keep in mind that building code differs from state to state, and you can refer to the building code to know the minimum R-value requirement of your location. In some areas, there are additional high-performance level requirements that you need to fulfill on top of the building code. It is highly advisable that you work with an architect, one that is educated in energy efficiency, when planning for home improvements.

R-Value & BTU R-value is also closely associated to British Thermal Unit (BTU). BTU means the amount of energy that is needed to raise the temperature of a one-pound

water by one degree Fahrenheit. It is also the value that is often referred by building professionals to determine how much of your house’s heat is lost through air changes (“draft” level of your home) and surface areas (doors, roof, windows, walls).

Hire a Professional The higher the R-value of a material, the higher it prevents surface transported heat-loss. Building professionals will be able to tell you how much heating you need to keep your house warm through the winter by factoring the R-value and BTU of your home. However, this is just the beginning and things can get complicated. This air transported heat loss may affect the R-value of the products in your home because the general architecture of your home effects the overall heating system. It is a complicated process, and that is why that it is advisable that you hire an energy professional whenever you are thinking of doing home improvements that affect the R-value, drafts and insulation of your home. For most homeowners, the R-value is one of the most misunderstood or complicated value. Hopefully, after reading this article, you have learned a good number of insights of about R-value and how it can affect your home improvements.

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Reviewing Window Ratings for Ideal Home Designing Window ratings are settled on the basis of energy efficiency and the filtration of UV light depending upon glass material used.

Any product or window that has low SHGC value will have a higher probability of reducing heat gain and offering shading effect.

Energy efficiency of windows can be studied using properties like heat gain and loss.

U-Factor

Such properties can be measured using certain parameters according to which window ratings are calculated.

Solar Heat Gain Coefficient It may be defined as the portion of solar radiation that passes through the window. Mode of transmission may either be direct or through absorption which is evidently released inside the house. 12

Conduction of non-solar heat flow can be measured using physical constants where rate of transmission is calculated for glazing alone. However, window ratings are measured according to the window’s overall performance of being energy efficient where U-Factor needs to be of low magnitude.

Air Leakage This particular parameter regulates ventilation where pace

of air movement is calculated based upon space and distance of frame. It is necessary to combine energy efficient windows with the right glazing to obtain maximum benefits. You bring value to a home with good windows by blending frames and glazing within a well sustained energy efficient design. Thermal resistance can be greatly improved using materials like wood, vinyl, fiber glass etc for increasing energy proficiency. Windows are an essential part of building a house and bring value to a home that present characteristics meant for more than just showcasing interior fashion.


Recycling Old Magazines with Kids Old magazines can be recycled in many ways. The best alternative it to be creative and involve your kids!

Christmas tree, they will have a lot of fun making it.

Actually, it’s nice family bonding time cutting, rolling, patching and doing all those things that can be done with magazines.

Magazines that are of the same theme such as food, fashion or cars can be used to make a scrap book.

Paper Mosaic

Perhaps you want to make a recipe book. All you will need to do is buy a plain book or a ream of plain printing paper.

If you have young children in pre-school or kindergarten, mosaics are fun. Kindergarten children will enjoy cutting and sticking papers for simple objects like animals. Mosaics are usually made from tiny colored pieces of just about anything from stone and paper to glass and pottery. These pieces are arranged to make a pattern or specific image of choice.

Themed Scrapbook

From the magazines, cut out the favorite recipes you come across and glue them onto the book. If you are using plain paper you will have to file it. If you have boys that love cars, you can make a scrapbook on

the finest cars that have ever ran on this earth. Next to the picture write something you think they would like and it can make for a neat gift.

Hats and Bowls If newspapers can be used to make hats and bowls why not use magazines as well? Making the hat and bowl will take some time and patience. The bowl you make from magazine paper can literally be used in the kitchen to serve dry foods. The only difference is that you can’t wash it! Recycling old magazines can be fun especially when you include your kids!

You can use your paper mosaics to decorate the walls and ceiling.

Christmas Tree You know how much children love Christmas trees during the holidays! Even some adults get excited about decorating the tree. Using those magazines that have made a tower in your house, you can make a paper Christmas tree. There are several tutorials online, especially YouTube, that show how you can make a tree. If your kids enjoy decorating a 13


Is It Worth It To Install a Tankless Water Heater? Before you replace your tank water heater consider tankless water heaters. Tankless heaters provide hot water only when you need it. Therefore, water is heated only when you open your faucet. The water is heated as it flows inside capillary-like pipes. The heating is done either by electric coils or by a powerful gas burner.

The tankless heaters have many advantages over the traditional method of heating water in a tank sitting in the basement.

Saves Energy This is the main reason why more people today are opting for these heaters. Although you will spend more money on installation compared

to a tank heater, they are definitely worth it in the long run. This is because they will help you cut the cost of heating water in your home tremendously. This is possible because when you use tankless heaters, you will not spend money paying for standby heat, i.e., heating water and leaving it idle in the tank and waiting for someone who needs hot water. Since this water heater only heats water on demand, there is no energy wasted in heating unused water. Even if a water tank is insulated, the water will still lose heat creating the need for reheating so it uses more energy.

Long Lifespan A typical tank water heater lasts between 10 and 13 years. Tankless water heaters can last up to 20 years. If you are hoping to use your water heater for a long time, installing a tankless heater can help you save the replacement cost that you would incur if you use tank water heaters.

Saves Space If you feel that you need more space in your home, you should start by installing these water heaters.

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Compared to tank water heaters, you don’t need a lot of space to install tankless water heaters. Since their size is like that of a computer, they can help you save a lot of valuable space in your home.

Safer and Cleaner When you have water stored in a tank, it can easily be contaminated with scale and rust. When you use a tankless heater you don’t need a water tank to heat your water. This eliminates the possibility of unclean water coming out of your faucet.

Comfort & Convenience

The high cost of installation is one reason that has prevented many people who want to cut down their energy cost from installing them.

Instantaneous Energy Requirement When you are using tank water heaters, it is possible to still get hot water when the source of heat is unavailable. This is because the water in the tank stays hot for a while after heating. When you are using a tankless heater, there has to be supply of energy for it to operate. When energy is unavailable, there is no way hot water can come out of the faucet.

Limited Output Tank water heaters can heat up to 60 gallons of water at time. This makes it possible for people to shower, do laundry, clean dishes and do all other chores that need hot water without it running out. A tankless heater can only supply a few gallons of water at a time. Hence, if you have a large family and everyone needs hot water at the same time, the heater might not be able to keep up with the task. However, this problem can be solved by installing several units to serve different parts of your house.

Most families using tank water heaters schedule the bathing time for everyone to minimize the cost of energy used to heat water. If the members of the family shower at different times, a high energy bill will result because the water will be heated several times each day. When you use a tankless heater people have the freedom to shower any time because water is only heated on demand. However, the tankless water heater has few disadvantages too.

Costly Product Most tankless heaters are two times more expensive than the tank water heaters. 15


Opening Doors...

...Making the Dream of Home Ownership a Reality Call and Let Us Help Make Your Dream Come True! We appreciate your time and enjoy the start of a great summer! Brett Felz & Bob Friel


Brett Felz Monthly Newsletter - 06/2014