Due to the collapse of sub-prime lending practices and “bad” loans that were automatically serviced by more reputable commercial banks, the United States housing market has suffered greatly. Our incumbent President Obama entered his term with Congress having already introduced the “bailout” as a partial solution to saving major United States corporations and consequently, industries. The housing market has experienced an astronomical amount of foreclosures during this economic downturn. Accordingly, distressed real estate purchases present options for homebuyers that they might not otherwise experience, had the market retained most appraised home values/pricing.
A buyer with $150,000 cash has the option of purchasing a distressed property for well below the market value, which in this kind of market is much lower than 4 years ago, provided the foreclosure amount the “seller” owes is less than the market value. In other words, a buyer purchasing a distressed property would do well to bid a contract price over the defaulted mortgage loan amount to cover the bank-owner’s investment into the property. So, my first recommendation would be to find a suitable property with these kinds of purchase features: Distressed property value is greater than the foreclosed loan amount.
Then, I would bid on the home to cover the defaulted bank loan amount to close the sale. Should the distressed property purchase be made with perspective buyers with good credit, I would acquire a loan from a long-standing reputable commercial bank. Preferably, a low-interest fixed rate loan product would be ideal. However, if a variable home loan was the only option, I’d seek one with a fixed interest rate for at least five years, and make sure there we...
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4 Use portion of $150,000 for acquiring additional “Green” funding/incentives or partnering with Green home improvement shows/networks.
5 Use remaining $150,000 and surplus funds to make the home green through energy efficiency, improving bathrooms and kitchen first (for room that add highest re-sale value), then heating, plumbing and electrical.
This plan provides for maximum personal enjoyment, adding Green value which saves energy costs and accounts for environmental friendliness (social responsibility) while using materials that will last (less in upgrades and repairs over time of home ownership). If owner doesn’t occupy the home personally, I would recommend putting the Green home up for sale, offering long-term savings for any new buyer. However, if I worked this hard to go green, I’d be settled into a new formerly-distressed-turned Green home!
In existence is $150,000, specifically set aside for the purchase of distressed real estate. This essay will outline a detailed strategy ensuring a maximum return in regard to the financial investment made on the home. Including a description of distressed real estate and foreclosure in addition to how utility can play a role in the decision-making process.
When working within the realm of real estate, flipping houses is one of the most lucrative projects one can undertake. The premise of this idea is buying a home in need of repair, renovating it, and selling it at its newly appraised value. In high school, I worked alongside my mother to renovate a home in our small town of Trinidad, Colorado. The invaluable lessons I learned throughout this business venture gave me insights into the inner workings of house flipping. What I gained from this experience will lead to better decision making if I choose to take on another project. With a $150,000 budget, the most important aspects to focus on in a renovation would include updating appliances, applying fresh paint, installing proper flooring, and revamping the exterior. Assuming that the home being foreclosed on costs $110,000, I would allocate $20,000 of my budget for renovation expenses. This leaves a $20,000 buffer to be used as an emergency fund.
The frequency of foreclosure in our nation today is dangerously high. The strain from the recent economic downturn has put many families and individuals in a financial chokehold preventing them from being able to make their monthly mortgage payments. Consequently, many of these people feel they’ve punched a one-way ticket to foreclosure. With all these homes being foreclosed on, we face a very real crisis.
I know that you wanted a sustainable home. How did you incorporate “green” ideas in a small house?
Weltman, Barbara. "Tax Incentives for Going Green." NY Report. N.p., 3 Feb. 2010. Web. 06 Feb. 2014.
Kats, G., Alevantis, L., Berman A., Perlman J., & Mills, E. (2003, October). The Costs and Financial Benefits of Green Buildings: A Report to California’s Sustainable Building Task Force. Retrieved from http://www.usgbc.org/Docs/News/News477.pdf
Typical loans don’t cover the cost of incorporating green aspects when choosing to build eco-friendly. However, there certain companies that offers energy efficient mortgages (EEM’s). One company, My Energy Loan (www.myEnergyLoan.com) does both residential and commercial eco-friendly loans, included in there services are ideas to help improve efficiency. They do an assessment and make suggestions on some ideas of improvements including lowe...
Green building has come forth over the past decade as a positive movement to produce high-performance, energy-efficient structures that improve comfort and health for resident, meanwhile, minimizing environmental impacts. Nevertheless, a common sense that green features is expensive and not suitable for affordable housing. Recent studies are showed that green buildings have a modest initial cost premium, but the long-term benefits far exceed the additional capital costs. For this report, I will introduce a financial analysis -Net Present Value (NPV), and discuss the impacts of NPV analysis for green affordable housing.
The beginnings of today's green revolution can be traced back to the environmental awareness of the 1960s and European design. New construction techniques have lead to the development of innovative materials and design concepts. Green buildings are designed, constructed and commissioned to ensure they are healthy for their occupants. Successfully designed green projects can involve an extensive array of factors, ranging from the resourceful use of materials, to careful consideration of function, climate, and location.
In the year 2011 our president Obama gave tax incentives to builders who use green building materials. It helps commercial or big business save $40 Billion per year and $1.2 Trillion in the energy efficiency. By using green building materials there is 20% cut in commercial building.These Businesses are able to use the saving money for other Green Building (“Long”).
From my personal standpoint, develop green design is a good approach to affordable housing. It is not only a global issue, but a major concern, especially in developing countries such as Malaysia.
The environmental, sustainability, or “green” movement has been around since the mid-20th century. However, due to various cultural, political, social, and technological factors, the trend towards going “green,” or becoming environmentally friendly, has almost become a norm in most industries, whether it is automobile manufacturing or home building. Global warming has been a growing concern all over the world, and green building has been one way to cease and, in some cases, combat some of the damage that has already been done to the environment. Green construction has been a rapidly growing industry, especially considering that the real estate market is currently in an early recovery stage, post-recession. Inc. recently ranked it as one of the top industries of 2014. Additionally, the US Green Building Council stated that “total revenue across the industry should grow to $245 billion by 2016” (Lapowsky).
On the other hand, there are other disadvantages related to costs when a business decides to go green. For example, sometimes the costs to install and maintain “green” materials may not offset the savings in the long or short run. In the event that th...
By going-green it can save our home and help it from diminishing beneath our feet. By making better choices as an indivial we can save our home and keep us healthy along with it. We can recycle simple produces, turn down the thermostat, and use less water. By doing these things we can save our home one green at a time. So go on, help save our home, your home, go green.
‘Green Homes’ or ‘Sustainable Housing’ is an approach that includes household systems that reduce pressure on natural resources and carbon emissions, thus resulting in human wellbeing, social equity, and green economy. Besides energy efficient buildings, it also includes eco-friendly practices for water and waste management systems such as rainwater harvesting, and waste/wastewater recycling. Housing sector contributes significantly to the local economy but it can also cause pollution and promote unsustainable living.