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Why the value of your home may go up

Fri, 19 Jul 2013 21:27:40 +0000

“It’s about energy efficiency, it’s about savings, it’s about increasing the borrowing power for the borrower. I think it’s a win-win for the industry,” said Sen. Johnny Isakson, a co-sponsor of the bill.

The bill instructs lenders with loans backed by Fannie Mae, Freddie Mac and the Federal Housing Administration, (which is about 90 percent of the market) to account for expected energy cost savings.

Those savings must then be factored into how much the borrower can afford in a monthly mortgage payment, so the energy savings are essentially subtracted from a borrowers expenses.

“You would be amazed at how a few dollars can make a difference in a transaction, $50 in a monthly payment, because people calculate their purchase and what to borrow based upon what it’s going to cost them per month,” argued Isakson.

The bill also tells lenders to add the value of expected energy savings to the value of the home in the appraisal. Since mortgage amounts are based on a percentage of the value of the home, this would allow borrowers to get a bigger mortgage.

(Read more: Housing starts stall, optimism doesn’t)

That’s where homeowners, like Tamara Lyons in Darnestown, Md., who already have green technology in their homes, will be able to make more money when they sell. The value of green will be in the appraisal.

“A lot of my neighbors feel that it’s too much of an initial investment, and they don’t want to put that money down,” explained Lyons, “But, if they see that it’s going to add to the value of their home for resale purposes I think it would definitely make the idea more sexy and more appealing.”

The legislation could also benefit companies that are investing heavily in green product development.

“Certainly companies like Dow or Home Depot who have been working on selling and highlighting their energy-efficient products. Insulation manufacturers … the whole host of manufacturers who make the products that go into the homes that make them more energy efficient,” said Stephen Cowell, CEO of Conservation Services Group.

“So we have a host of technologies and this would give manufacturers, builders, retailers and retrofit companies all an opportunity to begin reaching consumers to say ‘if you take advantage, if you put these products in, you can increase your home’s value’ because it’s now available to a broader range of homebuyers in the marketplace.”

Article source: http://www.cnbc.com/id/100899584

Home Improvement Shows Gains—But May Not Last

Tue, 14 Aug 2012 19:30:32 +0000

The nation’s largest home improvement retailer, Home Depot, surprised the Street on Tuesday, beating profit estimates for the last quarter. It is also raising earnings outlooks for fiscal 2012.

It’s banking on continued improvement in market share and in the housing market, especially in California and Florida, which were two of the worst hit states in the recent crash.

Those two states were among the top sales performers for Home Depot
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] in the quarter. (Related: Home Depot Earnings)

“These are encouraging signs of stabilization in the housing market,” said Home Depot Chairman and CEO Frank Blake on an investor conference call.

As some analysts claim the housing market is rising from the bottom, citing the highest level of housing starts in three years, others caution that the ills still plaguing the market stand as severe headwinds to the home improvement retailers in general.

The foreclosure slowdown to a five-year low, said California-based analyst Mark Hanson, could hurt the likes of Home Depot. He cites the 22 percent (month-over-month) July drop in home sales in Phoenix as an example.

“The Phoenix region is a leading indicator to other more ‘distressed’ regions that made up most of the dead-cat bounce in Q1 and Q2 housing. The foreclosure rehab trade is now a headwind to Home Depot,” Hanson said. (Related: Why Drop in Foreclosures Is Bad for Housing Market)

Hanson expects July existing home sales to come in at the lowest annualized rate of the year. While few others are predicting such a “triple-dip,” Hanson has been warning for months that a drop in distressed supplies would stem the rebound in home sales, and it did just that in May and June.

This is not to say that the foreclosure crisis is gone, just perhaps delayed for the next few quarters. There are still 5.7 million loans that are either delinquent or in the foreclosure process, according to the latest reading from Lender Processing Services. While not all of those loans will go to final foreclosure, many of them will, and there is a huge cadre of hungry investors waiting to buy them up and do quick rehabs in order to rent them out.

Along with foreclosure issues, rising mortgage rates could also thwart some home improvement gains. Record low rates have prompted a surge in refinancing, giving many Americans extra cash to spend on remodeling. Home Depot cites sales gains in kitchen and bath, some of the first projects homeowners undertake when they have the means to do so.

“Today’s rates on the street are the highest since the last week in May, back at 4 percent,” said Hanson (quoting no-point to no-cost loan rates).

He also also noted most of those who could benefit from rates below 4 percent already refinanced in June and July. “Thus the cliff dive in weekly mortgage applications over the next three weeks will be one for the record books.”

—By CNBC’s Diana Olick

Questions? Comments? And follow me on Twitter @Diana_Olick

Article source: http://www.cnbc.com/id/48662461?__source=RSS*blog*&par=RSS

TERRENO REALTY Corp. Reports Operating Results (10-K)

Fri, 25 Feb 2011 05:23:38 +0000

TERRENO REALTY Corp. (TRNO) filed Annual Report for the period ended 2010-12-31.

Terreno Realty Corp. has a market cap of $161.5 million; its shares were traded at around $17.45 .

Mutual Fund and Other Gurus that owns TRNO: Third Avenue Management.

Highlight of Business Operations:

Terreno Realty Corporation (?Terreno?, and together with its subsidiaries, ?we?, ?us?, ?our,? ?our company? or ?the company?) is an internally managed Maryland corporation focused on acquiring, owning and operating industrial real estate located in six major coastal U.S. markets: Los Angeles Area; Northern New Jersey/New York City; San Francisco Bay Area; Seattle Area; Miami Area; and Washington, D.C./Baltimore. We invest in several types of industrial real estate, including warehouse/distribution, flex (including light industrial and RD) and trans-shipment. We target functional buildings in infill locations that may be shared by multiple tenants and that cater to customer demand within the various submarkets in which we operate. Infill locations are geographic locations surrounded by high concentrations of already developed land and existing buildings. As of December 31, 2010, we owned a total of 33 buildings in five of the above markets aggregating approximately 2.4 million square feet, which we purchased for an aggregate purchase price of approximately $134.4 million, including the assumption of mortgage loans payable of approximately $17.9 million. As of December 31, 2010, our tenants Home Depot, Precision Custom Coating and YRC, Inc. accounted for approximately 17.4%, 14.9% and 11.5%, respectively, of our total annualized base rent.

We were incorporated in November 2009 and on February 16, 2010, we completed both our initial public offering of 8,750,000 shares of our common stock and a concurrent private placement of an aggregate of 350,000 shares of our common stock to our executive officers at a price per share of $20.00. We estimate that the net proceeds of our initial public offering were approximately $162.8 million after deducting the full underwriting discount of approximately $10.5 million and other estimated offering expenses of approximately $1.7 million. The underwriters agreed to forego the receipt of payment of $0.80 per share, or approximately $7.0 million in the aggregate, until such time as we purchase assets in accordance with our investment strategy as described in this Annual Report on Form 10-K with an aggregate purchase price (including the amount of any outstanding indebtedness assumed or incurred by us) at least equal to the net proceeds from our initial public offering (after deducting the full underwriting discount and other estimated offering expenses payable by us), at which time, we have agreed to pay the underwriters the remainder of the underwriting discount. We received net proceeds of approximately $7.0 million from our concurrent private placement. In the aggregate, we had approximately $169.8 million in cash available to execute our business strategy upon completion of our initial public offering and the concurrent private placement on February 16, 2010.

Read the The complete Report

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Article source: http://www.gurufocus.com/news.php?id=123558