Repairing Crumbling Foundations

CT Department of Housing
Photo: CT Department of Housing

Property owners in a portion of Connecticut have been struggling with foundation problems. The concrete mix used to build their homes included pyrrhotite, which is a mineral that causes foundations to deteriorate due to exposure to air and water.

There is no way to repair a defective foundation. The only way to save a home with pyrrhotite is to replace the foundation, a very expensive project.

Home insurers didn’t think replacing the foundation was their responsibility since nothing new had happened to the house. Buyers avoided homes where there was any suspicion of foundation problems. Homeowners with the issue were basically stuck. They had to deal with it on their own.

The State Legislature stepped in during the 2018 session to create a non-profit organization called the Connecticut Foundation Solutions Indemnity Company, Inc. (CFSIC). The CFSIC will begin working with property owners in January 2019 to process crumbling foundation claims, and pay for replacement.

CFSIC is primarily funded by the State of Connecticut, which will issue $20 million in bonds per year for five years to seed the program. A second source of funding, a $12 surcharge on homeowners’ insurance policies, was also authorized by the Legislature. The surcharge is expected to contribute $8.5 million per year.

Additional assistance may also be available to impacted property owners. For example, Travelers recently announced that they could contribute $5 million to enhance the CFSIC benefit for their current and former policyholders. Not sure if other insurers will step up, but it’s great that one of our local companies has.

The crumbling foundation problem can be financially devastating to homeowners. We’re glad that there is a process in place to address the issue, and hope that the application process proceeds smoothly for those who are impacted.

Walking to Work

Maybe you noticed. We had a large snowstorm come through on Friday. Hopefully by now you and your street are shoveled out. Many people remain stuck though. Help them if you can. Be neighborly.


Hosed

There was plenty of advance warning that the storm was coming, but of course no one really knew just how much snow we would get. Most agents realized that showings on Saturday would be a waste of time, so if they were showing this weekend, they booked for Sunday.

But I had a home inspection scheduled for Saturday afternoon. Would we still have it? When I woke up Saturday morning I clearly wasn’t going anywhere anytime soon. We had 24 inches of snow in our yard and our street had not been plowed all evening. I emailed the home inspector at 7:30am and said that I expected we would reschedule. He responded almost immediately and said he was still planning on doing the inspection at 1:00pm and he would email me at noon to confirm.

What the heck? Dude, the Governor has closed all of the roads. How are you going to get there and where the heck are you going to park? I emailed him something to that effect, leaving out the “Dude,” of course. No response.

The buyer emailed me at 9:30am to find out what was going on. I was outside, shoveling. We chatted via phone after that and determined that we needed to tell the inspector that we weren’t going to the inspection on Saturday and that we really wanted to reschedule for Sunday at 9:00am. After some arm twisting, that seemed to work.

By the end of the day on Saturday, my street still was not plowed. I realized that I would be walking to my inspection on Sunday morning. It was just a little over a mile from my house and less than that for the buyer. They thought they would walk too.

It was a nice stroll. By morning my street was plowed. My walk was mostly in the street because sidewalks were sporadically cleared and it was just easier to stay in the street. Here is some of what I saw…


The Start


The Main Drag


Other Walkers


Immanuel Congregational


Dishes


Lion with Snow Hat

Green Fuses

These are fuses for the electrical system of a house. Most homes that you see these days have been updated to circuit breakers, so finding fuse boxes becomes less common each year. It’s okay to want to buy a house that has fuses, but you should plan for them to be upgraded. Perhaps you’ll be able to convince the seller to deal with them before the closing. That’s unfortunately not always possible though, so just make a mental note as you’re evaluating the property.

Green Fuses

Inspecting the Laundry Area

Home inspection after home inspection reveals a few common problems with laundry areas. They’re not big problems, meaning that buyers usually don’t ask the seller to do anything about the issues, but a couple key things are flagged with surprising frequency.

Laundry Area1. Your washer should connect to the hot and cold water supply using steel braided hoses. The rubber hoses that are commonly observed are vulnerable to weakening over time and can potentially rupture.

2. You should turn off the water supply to your washer between uses. This is more of a precautionary suggestion just in case there is a failure within the washing machine itself. Water creates a really big mess, especially if there is important stuff below the leak.

3. Dryer vent ducts should take a direct and efficient route to the outside. Flexible vents should be used as little as possible, with 18 inches as an upper limit. Rigid metal ducting is preferred since it is smooth and will catch less lint, and is therefore less of a fire hazard. Even the rigid ducts should be as short and straight as possible, with horizontal runs sloping slightly downwards.

After hearing these same findings a bunch of times, I’m finally adding them to the list of projects that I should be working on in our home. We’re all set on the first two; we have the steel braided hoses and the ability to easily shut off the water supply. But it is time for me to revisit the dryer vent – we have a very long flexible duct. Tisk, tisk!

Real Estate Bargains: Getting the Best Buy Possible

Reflecting on the Real Estate MarketsYesterday we highlighted four common myths that sometimes lead buyers to believe they’re getting a better deal than they really are. Today we’re sharing some thoughts about finding true real estate bargains.

Let’s just get this first point out of the way early. If you’re looking for a ridiculous value – a complete steal – then a real estate agent probably isn’t going to find it for you. You need to start pounding the pavement to track down leads on your own. You need to find sellers who are (1) just starting to think about selling their home, and (2) completely out of touch with the approximate value of their home and the real estate market overall. Because once they talk to a real estate agent, or begin to look at what similar homes are selling for, the pricing is going to be far more rational and efficient. You are effectively competing with agents for listings.

Okay, so if we agree that your buyer’s agent is not going to find you the deal of a lifetime, how do you find a good real estate deal?

1. Look at what everyone else is ignoring.
Buyers are currently fixated on fully updated homes. This is a big change from the middle of the decade when sweat equity was all the rage. As a result, there are some interesting opportunities in homes that are in desirable locations but need some work. Sometimes these homes can be money pits, but other times the main issues are cosmetic. Differentiating between the two can lead to very good investments.

2. Be flexible in your requirements.
The wider the range of possibilities that you are considering, the more likely you are going to find a seller willing to compromise on price. Consider multiple towns. Consider different house styles. Consider different bedroom and bathroom configurations. The more options you are open to, the more likely an opportunity will come your way.

3. Be ready, willing, and able to react.
Every now and then we come across a property listed in the MLS that’s a good buy. We tell as many of our buyer clients about it as possible, but most of the time it’s not a good fit for their needs or the timing isn’t right.

For example, last year there was a home in a popular neighborhood in West Hartford that turned out to be a very good buy. According to the group of agents who visited it with us on broker’s tour, it was initially listed about 10% too high. It was also listed late in the spring market. The sellers quickly lowered the price to the point it was fair, but nothing happened. Buyers had checked out for the summer and there were no offers. After lowering the price to about 8% below was we all initially agreed was fair, they got an offer. The property ended up closing more than 12% below what we thought it was worth, and more than 20% below the initial asking price. It was not a distressed home, just one that got lost in the shuffle due to poor timing and pricing.

4. Focus on more than just the price.
Most of the homes in Greater Hartford are more than 25 years old, which means that their original mechanicals are approaching the end of their useful lives. Time for a quiz! You have the choice of buying two houses that are virtually identical. Choice A is a home with fresh, tasteful paint, but older mechanicals. Choice B is a home with hideous wallpaper and shag carpet everywhere, but new windows, roof, and furnace. Both have dated, but functional, kitchens and baths. Both have the same number of bedrooms, baths, and total rooms, and both have the same asking price. Which do you prefer?

Most buyers gravitate towards the tasteful and pretty. They overestimate the amount of time, effort, and money needed for cosmetic issues and underestimate the value of the mechanicals. Not only will newer mechanicals allow you to avoid the cost of replacing them, they will also operate more efficiently and save you money every month.

The average real estate buyer and seller is much more knowledgeable today than ever before. Information available via the internet and traditional media sources help them understand the sales process and pricing, which in turn makes the overall market more efficient. Finding an unbelievable bargain is a real challenge. Most buyers are focused on making sure that they get a good buy if a property needs work, and at least pay a fair price if the home is in move-in condition. The key is to know what else is on the market, so you know if the price is right.