Archive for March, 2010

Give Me Liberty Or Give Me Death!

Tuesday, March 23rd, 2010

patrick_henry1

Probably one of the most famous phrases in American history was delivered by Patrick Henry on this day in 1775 and is credited with having swung the balance in convincing the Virginia House of Burgesses to pass a resolution delivering the Virginia troops to the Revolutionary War. Among the delegates to the convention were future US Presidents Thomas Jefferson and George Washington. Reportedly, those in attendance, upon hearing the speech, shouted, “To arms! To arms!”

“No man thinks more highly than I do of the patriotism, as well as abilities, of the very worthy gentlemen who have just addressed the House. But different men often see the same subject in different lights; and, therefore, I hope it will not be thought disrespectful to those gentlemen if, entertaining as I do opinions of a character very opposite to theirs, I shall speak forth my sentiments freely and without reserve.

This is no time for ceremony. The questing before the House is one of awful moment to this country. For my own part, I consider it as nothing less than a question of freedom or slavery; and in proportion to the magnitude of the subject ought to be the freedom of the debate. It is only in this way that we can hope to arrive at truth, and fulfill the great responsibility which we hold to God and our country. Should I keep back my opinions at such a time, through fear of giving offense, I should consider myself as guilty of treason towards my country, and of an act of disloyalty toward the Majesty of Heaven, which I revere above all earthly kings.

Mr. President, it is natural to man to indulge in the illusions of hope.

We are apt to shut our eyes against a painful truth, and listen to the song of that siren till she transforms us into beasts. Is this the part of wise men, engaged in a great and arduous struggle for liberty? Are we disposed to be of the number of those who, having eyes, see not, and, having ears, hear not, the things which so nearly concern their temporal salvation? For my part, whatever anguish of spirit it may cost, I am willing to know the whole truth; to know the worst, and to provide for it.

I have but one lamp by which my feet are guided, and that is the lamp of experience. I know of no way of judging of the future but by the past. And judging by the past, I wish to know what there has been in the conduct of the British ministry for the last ten years to justify those hopes with which gentlemen have been pleased to solace themselves and the House.

Is it that insidious smile with which our petition has been lately received? Trust it not, sir; it will prove a snare to your feet. Suffer not yourselves to be betrayed with a kiss.

Ask yourselves how this gracious reception of our petition comports with those warlike preparations which cover our waters and darken our land. Are fleets and armies necessary to a work of love and reconciliation? Have we shown ourselves so unwilling to be reconciled that force must be called in to win back our love?

Let us not deceive ourselves, sir. These are the implements of war and subjugation; the last arguments to which kings resort. I ask gentlemen, sir, what means this martial array, if its purpose be not to force us to submission? Can gentlemen assign any other possible motive for it? Has Great Britain any enemy, in this quarter of the world, to call for all this accumulation of navies and armies?

No, sir, she has none. They are meant for us: they can be meant for no other. They are sent over to bind and rivet upon us those chains which the British ministry have been so long forging. And what have we to oppose to them? Shall we try argument?

Sir, we have been trying that for the last ten years. Have we anything new to offer upon the subject? Nothing. We have held the subject up in every light of which it is capable; but it has been all in vain. Shall we resort to entreaty and humble supplication? What terms shall we find which have not been already exhausted? Let us not, I beseech you, sir, deceive ourselves.

Sir, we have done everything that could be done to avert the storm which is now coming on. We have petitioned; we have remonstrated; we have supplicated; we have prostrated ourselves before the throne, and have implored its interposition to arrest the tyrannical hands of the ministry and Parliament. Our petitions have been slighted; our remonstrances have produced additional violence and insult; our supplications have been disregarded; and we have been spurned, with contempt, from the foot of the throne! In vain, after these things, may we indulge the fond hope of peace and reconciliation.

There is no longer any room for hope. If we wish to be free– if we mean to preserve inviolate those inestimable privileges for which we have been so long contending–if we mean not basely to abandon the noble struggle in which we have been so long engaged, and which we have pledged ourselves never to abandon until the glorious object of our contest shall be obtained–we must fight! I repeat it, sir, we must fight! An appeal to arms and to the God of hosts is all that is left us!

They tell us, sir, that we are weak; unable to cope with so formidable an adversary. But when shall we be stronger? Will it be the next week, or the next year? Will it be when we are totally disarmed, and when a British guard shall be stationed in every house? Shall we gather strength by irresolution and inaction? Shall we acquire the means of effectual resistance by lying supinely on our backs and hugging the delusive phantom of hope, until our enemies shall have bound us hand and foot?

Sir, we are not weak if we make a proper use of those means which the God of nature hath placed in our power. The millions of people, armed in the holy cause of liberty, and in such a country as that which we possess, are invincible by any force which our enemy can send against us.

Besides, sir, we shall not fight our battles alone. There is a just God who presides over the destinies of nations, and who will raise up friends to fight our battles for us. The battle, sir, is not to the strong alone; it is to the vigilant, the active, the brave. Besides, sir, we have no election. If we were base enough to desire it, it is now too late to retire from the contest. There is no retreat but in submission and slavery! Our chains are forged! Their clanking may be heard on the plains of Boston! The war is inevitable–and let it come! I repeat it, sir, let it come.

It is in vain, sir, to extenuate the matter. Gentlemen may cry, Peace, Peace– but there is no peace. The war is actually begun! The next gale that sweeps from the north will bring to our ears the clash of resounding arms! Our brethren are already in the field! Why stand we here idle? What is it that gentlemen wish? What would they have? Is life so dear, or peace so sweet, as to be purchased at the price of chains and slavery? Forbid it, Almighty God! I know not what course others may take; but as for me, give me liberty or give me death!”

Happy St. Patrick’s Day

Wednesday, March 17th, 2010

Home Not Selling? Thinking Of Renting It Out?

Tuesday, March 16th, 2010

Here’s a tough situation for a homeowner. You bought your house for $300,000 a few years ago. You owe $250,000 on the mortgage and can hardly afford to make the payments anymore. You want to sell, but values have tanked in your area and the best price you can get is $200,000.

Should you wait until values come back up and rent it out in the meantime? Unhappy with bids coming in, many homeowners have been doing just that. (In fact, last summer Treasury Secretary Timothy Geithner rented out his family’s five-bedroom $1.635 million home in Larchmont, N.Y., after it sat on the market for several months.)

But this strategy doesn’t always make financial sense. It can be almost as hard to rent your home as selling it, and there are costs associated with renting that you might not have considered, including insurance and management fees. Plus, if you’re betting the market will recover and you will get more from a sale down the road, you might be risking too much.

“If it costs, say, $9,000 to hold onto the house this year, are you sure it’s going to appreciate $9,000 in the next 12 months?” says John Vogel, a professor of real estate at the Tuck School of Business at Dartmouth. “Given what’s going on with unemployment, plus the time and hassle involved in managing a house, it’s far from a sure bet.”

What’s more, home prices nationwide are forecast to fall more than 8% in 2010, according to data from Moody’s. “There’s at least as good a chance that the market will be worse a year from now as it will better a year from now,” says Vogel.

Despite recent signs of stabilization in the overall economy, it’s still a renter’s market. Rising unemployment has dampened rental housing demand and contributed to a 3.4% decline in asking rents in 2009, according to real estate investment services firm Marcus & Millichap. The firm estimates that the single-family home rental vacancy rate has risen to 10% at the end of 2009 from 7% in 1997. That’s slightly down from the 10.5% it was in 2007, but it’s still higher than last year’s 8% apartment vacancy rate. “We’re at an all-time high vacancy rate for apartments as well as single-family homes that are on the market for rent,” says Hessam Nadji, managing director of research services at Marcus & Millichap.

New construction is partially to blame for the supply overhang. More than 120,000 apartment units came into the market in 2009, driven by developers who had obtained financing before the credit crisis really hit, according to Reis, which tracks the real estate market. High apartment vacancy rates have pushed owners to lower rents, says Peggy Abkemeier, president of Rent.com, an online rental marketplace – making apartments more attractive for at least certain types of renters. Abkemeier says that while there has been an uptick in renters seeking homes for rent on Rent.com, apartment-related searches still remain more popular than house-related searches.

“You have to realize, you’re not the only one with a house on your hands that you don’t want to sell at the moment and want to rent out,” says Janet Portman, a real estate lawyer and author of “Every Landlord’s Legal Guide.” Assess the market and find out if houses like yours are a dime a dozen – if it is, the rent you’d collect might be lower than you hoped for, she says.

And because of the oversupply, in some markets it’s also taking longer to find renters than it did a couple of years ago – and that means lost rental income. “Now the competition is greater in the higher-end markets, and it might take four months to rent a home, whereas before you could rent one in 30 days,” says George Pabst, president of Pabst Kinney & Associates, a property-management firm in Long Beach, Calif.

For frustrated sellers still intent on becoming landlords, here are a few points to consider:

* Typically, renting makes sense if you plan on returning to the home – say, if you were taking a sabbatical or were being transferred for a year to another city for your job.

* You’ll be getting income each month – but it should cover your monthly expenses, including mortgage payments, utilities, property taxes and higher homeowner’s insurance costs.

* You must pay federal taxes on the rental income – but at least some of that amount could be offset with deductions for operating expenses (mortgage interest, repairs, utilities) and depreciation.

* Don’t forget that tenants aren’t going to keep your property as tidy as you would, says Diane Saatchi, a senior vice president at Saunders Associates, a real estate brokerage in Bridgehampton, N.Y. As much as possible, you should carefully screen prospective renters to make sure they’re financially stable and good housekeepers.

Going Green Doesn’t Add Up To Getting Green

Monday, March 15th, 2010

eco-facepalmNEW YORK (CNNMoney.com) — Lots of people, especially those trying to battle high utility bills, believe in energy-efficient homebuilding.

But there’s something holding green technology back: It simply costs more to include it than it adds to resale value

Appraisals for newly built green homes do not fully reflect the cost of green technology, and the lower appraisal values mean buyers often cannot get the full financing they need from banks.

That discourages developers from using green technology, in turn diminishing the market for more green products.

“We can’t get lenders to appreciate the value, and if we can’t get the values recognized, manufacturers can’t justify moving these products forward,” said Bill Nolan, a Florida home building consultant.

How that works is illustrated in the case of clients of Michael Chandler, a North Carolina-based green building adviser, who wanted to build a $400,000 home incorporating many green features.

The house was designed to include passive solar heat, solar hot water, radiant floor, high-performance windows and insulation. But the bank’s appraiser told them that the appraisal would come in for less than the cost to construct.

In that case, the buyers would need to come up with a bigger down payment.

“Our best guess is that it will appraise at $380,000,” said Chandler. At 90% financing, the bank would put up $342,000, leaving the would-be buyers with a down payment of $58,000, instead of the $40,000 needed if the house was assessed at the full price.

“With 10% down, the clients would have to come up with (an extra) $18,000,” Chandler said. “They can’t do that.”

Appraisers feel their hands are tied.

“It doesn’t do a lot of good to simply add value based on cost,” said David Snook, a California-based appraiser who serves on the real property committee on education for the American Society of Appraisers. “The question is ‘How much will the market pay on resale?’”

The appraiser’s job is to accurately assess the value of the home. If a feature costs $50,000 to install but only adds $25,000 to the price when the home is resold, the appraisal cannot reflect the full $50,000 spent.

“Appraisers don’t make the market, they reflect it,” said Jim Amorin, spokesman for the Appraisal Institute. “Cost does not necessarily equal value. It depends on how the market reacts to the feature.”

Not under the influence
Also complicating appraisals these days are new rules to prevent loan originators from influencing appraisals. Builders cannot demand specific appraisers, ones more experienced at evaluating green building.

With Chandler’s client, the house is in a rural zip code, one where few energy efficient homes have been constructed. The appraiser had little idea of how much building green adds to value.

“The appraiser has no experience with green building,” he said.

Another problem is that appraisers also rely frequently on foreclosed homes for comparison, especially in places hit hard by defaults. These homes sell at big discounts to the regular market and even bigger discounts to green homes.

Low cost alternatives
Because of the appraisal issues, developers often opt for installing only the lowest-cost green features.

“Some can be incorporated without much additional cost,” said Curt Jones, a Connecticut-based civil engineer and green building consultant. As he describes the process for green certification, points are given for a wide variety of factors, some costing a lot, others costing nothing.

Angling the home a little differently, for example, to catch more rays and help heat the house passively, may not cost the builder a dime. But installing solar panels on the roof definitely will add a lot to the final price.

Ironically, turning green probably does add considerable value — or will, once green gets more established in individual locales and buyers get more familiar with it.

In Seattle, a hotbed of green-building activity, new homes with green certification sell for 8.5% more per square foot than comparable non-green ones, according to a report from GreenWorks Realty. They also sell 22% quicker.

“As more American homeowners green their homes, there will be more and more of a premium paid for green homes,” said Ben Kaufman, GreenWork’s founder. “I can imagine a miles-per-gallon type sticker on homes for sale and the marketplace will absolutely favor fuel-efficient homes.”

The Ides Of March

Monday, March 15th, 2010