Jeff Shauger, Associate Broker, ABR, CDPE, CRS, ePRO, GRI , SRES, SRS
 
Jeff Shauger, Associate Broker, ABR, CDPE, CRS, ePRO, GRI , SRES, SRS

Jeff's Blog

Aging-in-Place Remodeling on the Rise as Seniors Stay Home

February 29, 2012 3:52 am

The market for aging-in-place remodeling continues to grow as more homeowners choose to remain in their homes as they age, according to the National Association of Home Builders (NAHB). NAHB Certified Aging-In-Place Specialists (CAPS) experts were joined by representatives from AARP for a press conference held at the recent International Builders’ Show (IBS) to discuss how the aging-in-place market has changed as it moves mainstream, what consumers are looking for and what universal design and aging-in-place trends will be popular in the future.

Nine out of 10 people age 50 and older say they want to remain in their homes and communities for as long as possible. According to CAPS, the current 50-plus generation is typically healthier and wealthier than previous generations of similar age; they want their homes to accommodate their active, independent and upscale lifestyles.

Additionally, while the majority of CAPS consumers are 55-64 years of age, remodelers report that 23 percent of clients are younger (45-54 years of age) and planning ahead to age-in-place. According to NAHB, as aging-in-place modifications and universal design move into the mainstream, the CAPS program provides builders with the expertise necessary to provide accessibility, safety and low maintenance living to homeowners of any age.

The CAPS program was launched by NAHB in partnership with AARP, the NAHB Research Center and the NAHB 50+ Housing Council in 2002 and has been on the leading edge of home modifications for aging-in-place since its inception. The program has graduated more than 4,000 specialists in 10 years.

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Home Remodeling Expected to Rebound

February 28, 2012 3:52 am

After three years of slumping business, builders anticipate that the home remodeling and improvement sector will pick up in 2012, according to a recent article in The Orlando Sentinel.

During the recent National Association of Home Builders (NAHB) Conference, NAHB researcher Paul Emrath, reported that remodeling was beginning to edge up.

In 2011, U.S. residential remodeling added up to an estimated $279 billion, about the same as in 2010 but down almost 15 percent from 2007. New-home starts have fallen more than 70 percent around the country since the market peak in 2005.

While not coming close to approaching that peak, The National Association of Home Builders is forecasting an almost 9 percent increase in remodeling this year and more than an 11 percent jump nationwide in 2013. Emrath attributes the slow rebound to the decline in house prices and a lack of equity.

More than half of the home remodeling projects last year cost in excess of $25,000, and total home remodeling and improvement expenditures now add up to more dollars than new-home construction, according to the builders association. Remodeling accounts for close to 70 percent of U.S. residential construction expenditures.

The biggest share of home improvement spending, roughly 20 percent, goes for exterior repairs or upgrades. But kitchen and bathroom jobs are a close second at 19 percent of remodeling work. Upper-end discretionary remodeling projects that were popular in housing’s hey-day, are expected to be few and far between. Until nationwide home values improve, homeowners are expected to be more conservative with their remodeling.

Previously foreclosed homes needing repairs will continue to be a benefit to remodelers. Lenders are also spending money to improve distressed homes, with Fannie Mae spending more than $600 million to repair foreclosed properties.

The large inventory of foreclosed homes currently on the market, stand to help the remodeling business for some time to come.

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Consumers Demand Better Service from Insurers

February 28, 2012 3:52 am

U.S. insurance consumers want their insurers to offer more personalized service and reward customer loyalty, according to Ernst & Young’s Global Consumer Insurance Survey 2012. The survey also finds that consumers of life/annuity and property/casualty policies are willing to buy multiple products from the same carrier if they are tailored to meet their individual needs, and that millennials believe the strength and health of an insurer’s brand is more important than the price of the insurance product.

Ernst & Young surveyed more than 24,000 consumers of insurance products in 23 countries across seven global regions. The most important trends Ernst & Young found focus on U.S. consumers’ expectations of loyalty, customer service and online communications. Specifically, the three themes of critical significance to life/annuity and property/casualty insurers today are:
  • Loyalty rewards. While U.S. consumers continue to be satisfied with their insurance provider, many express a desire for better service and more loyalty rewards. More than one-third (36 percent) of consumers believe the life and pensions industry lags other industries in service, and nearly half (43 percent) of consumers say it does an insufficient job in rewarding loyalty. Consumers are accustomed to having their loyalty rewarded by other industries, and increasingly expect the same from insurers. The good news is that U.S. customers want to remain loyal to their insurers. In fact, 65 percent of respondents are either “not at all likely” or “not very likely” to change insurers in the next five years.
  • Personal interactions coupled with digital ease. Consumers are becoming more comfortable with online channels for researching insurance products and carriers, but the vast majority of people still want to rely on personal interaction to make their insurance purchases. On the property/casualty side, the survey found that personal interaction is particularly important when extending coverage (71 percent), making a claim (82 percent), or dealing with other customer service issues (78 percent). In life/annuities, 82 percent of consumers think it is important to have personal interaction when making an insurance purchase. Nevertheless, customers are showing a greater desire to use online sources to inform themselves prior to making a purchase (44 percent of life/annuity customers used online comparison sites), with two-thirds (66 percent) expecting to do more independent online research in the future.
  • Millennials put a premium on brand. U.S. insurance consumers generally trust their insurance providers, despite the recent financial crisis, but require them to offer more personalized service and reward customer loyalty, according to the survey. Specifically, Millennials are bucking conventional wisdom and paying more attention to brand than cost when picking an insurer. While price is still an important factor, consumers younger than 34 are willing to pay more for a brand they trust. In fact, almost half of Millennials (43 percent in property/casualty and 48 percent in life insurance) consider the financial stability of the insurance provider as the most important factor influencing their decision to buy insurance.

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Switching Banks on the Rise

February 28, 2012 3:52 am

Consumer backlash against bank fees, coupled with poor service and unmet customer expectations, has fueled increases in defection rates among customers of large, regional and midsize banks, according to a new study from J.D. Power and Associates.

As an increasing number of consumers switch from larger banks, smaller banks and credit unions continue to benefit, according to the 2012 U.S. Bank Customer Switching and Acquisition Study (SM).

Acquisition of new customers by smaller banks and credit unions has increased by 2.2 percentage points to an average of 10.3 percent in 2012 from 8.1 percent in 2011. Among big banks, regional banks and midsize banks, switching rates average between 10.0 and 11.3 percent, while the defection rate for small banks and credit unions averages only 0.9 percent, a significant drop from 8.8 percent in 2011.

The study, which examines the bank shopping and selection process, finds that 9.6 percent of customers in 2012 indicate they switched their primary banking institution during the past year to a new provider. This is up from 8.7 percent in 2011 and 7.7 percent in 2010.

The study finds that fees are the main reason customers shop for a new primary bank. In particular, one-third of customers of big and large regional banks cite fees as the main shopping trigger. When banks announce new fees, customers weigh the price they pay against the value of their experience. According to the study, a poor service experience followed by a fee increase is often the trigger that causes bank customers to look elsewhere. More than one-half of all customers who said fees were the main reason to shop for another bank also indicated that their prior bank provided poor service.

J.D. Power and Associates offers the following tips for customers looking to switch banks:
  • Shop around to compare terms and service before deciding on a bank. Don't forget about direct online banks, as their competitive fees and rates may offset any inconvenience due to lack of physical branches.
  • Don't be swayed by promotion gifts/cash alone. It is more important to ensure the bank that you are selecting offers the right products to meet your needs and that the fees associated with the products are in line with what you are willing to pay.
  • Read account brochures and disclosures carefully and don't be afraid to ask questions about the products you are about to open.
Source: J.D. Power and Associates

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Hard Water is Harsh on Appliances

February 27, 2012 3:52 am

Most Americans have hard water flowing through their plumbing, and it's taking a silent, but pricey toll on their water-using appliances and pipes, say the experts at Angie’s List.

"If you think you're not affected, think again: 85 percent of Americans have hard water," says Angie Hicks, founder of the website dedicated to consumer reviews of contractors and service companies. "Water with a high mineral count is really hard on your appliances and can take years off their useful lives."
Hicks advises that homeowners watch for the following red flags to see if their water is an issue:
  • Reduction in supply of hot water from a traditional tank water heater
  • Clothes are dingy or unclean after going through the washer
  • Calcium rings or deposits in tubs, sinks and dishwasher
  • Shower head and faucet clogs
  • Spotty or unclean dishes, glasses and flatware after the dishwasher has run
  • Water pipe leakage
Determining if you have hard water is simple and relatively inexpensive to address. Step one is to have your water analyzed, says Hicks. Some utilities and health departments offer this service, but companies that specialize in water conditioning also offer it, often free-of-charge. Because those companies have a vested interest in the outcome of such tests, consumers should consider getting at least one outside opinion.

Consumers have a few options when it comes to removing calcium and magnesium, the troublesome minerals that make water hard. Traditional water softeners use salt to remove those minerals. Devices that do not use salt to accomplish the same thing are often called "water conditioners" or "descalers."
Here are Angie's List tips for buying a water softener:
  • Water softeners can range from a few hundred dollars to more than $1,000 depending on size and type. Some companies offer rental equipment for a nominal monthly charge. Installation typically runs $150 to $300.
  • Before you buy a water softener or conditioner, research available products and service companies. Insist on a money-back guarantee.
  • In most states, installation does not require a licensed plumber. At a minimum, use a company with technicians certified by the Water Quality Association.
  • Understand and follow the maintenance required to keep the unit operating properly.

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Americans Prepare to Pay Even More at the Pump

February 27, 2012 3:52 am

Sticker shock at the pump is expected to get even worse in the coming years. According to a survey from the Advanced Energy Economy (AEE), 62 percent of Americans expect a gallon of gasoline to be $5 or more within the next five years. Eight in 10 Americans said that the country's dependence on foreign oil was either a "crisis" or "major problem" and that the cost had become a "burden."

Findings from the survey include:
  • 62 percent of Americans think a gallon of gas will cost $5 or more in the next five years. What's more, 31 percent believe it will be $6 or more and more than 1 in 10 (12.4 percent) believe it will be $7 or more.
  • 82 percent see our dependence on foreign oil as a "crisis" or "major problem" and where you fall in the political spectrum is largely irrelevant – this view applies to 85 percent of Republicans, 80 percent of Democrats and 78 percent of Independents.
  • 78 percent called the amount of money they spend on gasoline a "burden,” with nearly half saying a "serious burden" and nearly two-thirds reporting they are taking steps to save on gas costs.
  • 67 percent of Americans say they have taken steps in the last three years to save gasoline (such as buying a car with better gas mileage or changing their driving behavior). Even more than 60 percent of those making over $100,000 annually reported taking action to reduce their gasoline use.
  • 55 percent of Americans believe that efforts to make greater use of energy saving technologies that help our country do more with less have been "positive" because they save money over the long run and make our economy more productive and competitive. Twenty-five percent believe these efforts have been "negative" and 20 percent don't know/aren’t sure.
The AEE online survey of 1,004 adults was conducted from Dec. 6 through Dec. 7, 2011, by JZ Analytics.

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For Many, More Than Half of Income Spent on Housing

February 27, 2012 3:52 am

The share of working households paying more than half their income on housing rose significantly between 2008 and 2010 for both renters and owners, says a new study from the Center for Housing Policy. The “Housing Landscape 2012” annual report explores the latest Census data from 2008 to 2010 on housing costs and income, including housing cost burden data from the 50 largest U.S. metropolitan areas, all 50 states and the District of Columbia. Among other conclusions, “Housing Landscape 2012” finds that nearly one in four working households in the U.S. spends more than half of its total income on housing.

“Working households” are defined as those with a household income of no more than 120 percent of the area median income in which the household members worked an average of at least 20 hours per week for the preceding 12 months. Housing cost burden for working households grew over the two-year period studied largely due to falling incomes and rising rental housing costs. Report author Laura Williams says rents rose due to increased demand for rental housing, which has outstripped supply, partly due to the crisis on the homeownership side of the market.

For working homeowners over the same two-year period, incomes slid more than twice as much as housing costs. In fact, incomes for working homeowners fell even more sharply than they did for working renters. Additionally, the housing costs of most working homeowners are still tied to homes bought before the sharp drop in home prices and thus do not reflect today’s lower home purchase prices.

Following, are several key national findings from the report:
  • Nearly one in four working households spends more than half of its income on housing. The share of working households with a severe housing cost burden increased significantly between 2008 and 2010, rising from 21.8 percent to 23.6 percent.
  • Despite falling home prices and values, housing affordability worsened for working homeowners. Median housing costs for working homeowners declined modestly between 2008 and 2010. Meanwhile, the incomes of working homeowners declined even more, driven in large part by a decrease in the median number of hours worked per week between 2008 and 2010.
  • Working renters fared even worse, with both increased rents and decreased incomes between 2008 and 2010. While incomes increased somewhat between 2009 and 2010, over the two-year period renters saw a four percent decline in household income. The housing costs of renters rose over the two-year period by four percent.
Among the 50 states and the District of Columbia, the following five had the highest share of working households with a severe housing cost burden in 2010:
  • California - 34 percent
  • Florida - 33 percent
  • New Jersey - 32 percent
  • Hawaii - 30 percent
  • Nevada - 29 percent
Among the 50 largest metropolitan areas, the following five metropolitan areas had the highest share of working households with a severe housing cost burden in 2010:
  • Miami-Fort Lauderdale-Pompano Beach, Fla. - 43 percent
  • Los Angeles-Long Beach-Santa Ana, Calif. - 38 percent
  • San Diego-Carlsbad-San Marcos, Calif. - 37 percent
  • Riverside-San Bernardino-Ontario, Calif. - 35 percent
  • New York-Northern New Jersey-Long Island, N.Y.-N.J.-Pa. - 35 percent

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Spring into Gardening

February 24, 2012 3:50 am

As the first months of 2012 quickly tick by, now is the time to start thinking about your garden. By planning now, you’ll be ready to go once the season’s last frost is gone. The following tips from the experts at Preen can help you get a jumpstart on your season:
  • Investigate your shrubs. Winter weather may have wreaked havoc on shrubs and flowering bushes, so use this time to prune branches back to the next healthy joint or bud.
  • If you grow flowers from seeds, keep in mind that many plants need a big head start indoors. Petunias, impatiens, verbena and snapdragons should be planted indoors under lights, 10-12 weeks before the last spring frost.
  • Mustard, ragweed, henbit and many other pesky weeds start growing with the first hint of spring. Keep them from sprouting by applying a weed preventer two weeks before the ground begins to warm up.
  • Consider adding raspberries, blueberries, currants or other small fruits to your landscape. For the best selection, order dormant plants by mail. All should be planted in earliest spring as soon as the soil can be worked.
  • Grow your own micro-greens. Plant leftover broccoli, radish or basil seeds in a pot and grow on a sunny windowsill. Snip young plants with scissors for a pretty garnish or a spicy addition to a salad.
  • Take cuttings of geraniums, coleus, rosemary and other tender plants that you have overwintered indoors. Root them in water or in moist potting mix.
  • Most perennials benefit from being divided every few years. The best time to do this is earliest spring just as new growth appears. Think about the plants that are most in need of dividing and make a list of them so this task doesn’t get forgotten in the rush of spring.

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Top Kitchen Design Trends for 2012

February 24, 2012 3:50 am

A recent survey of more than 350 designer members of the National Kitchen & Bath Association (NKBA) revealed their top design trends for kitchens based on the materials, product types, and styles they incorporated into their kitchen designs over the final three months of 2011.

According to the results of the 2012 NKBA Design Trends Survey, while broad trends won’t be evident in every local market, the following represent overall trends for kitchens across the United States and Canada.

Cherry Wood in Decline

Cherry wood has consistently been the first or second most popular type of wood for cabinetry, jockeying for the top spot with maple each year. However, designers are slowly shifting away from it. While 80 percent of NKBA member kitchen designers had recently specified cherry cabinetry as 2010 approached, that figure dropped to 72 percent last year and fell again to 69 percent heading into 2012.

No one other wood species is taking that market share on its own, as even maple dropped in popularity this year, falling from 77 percent last year to 70 percent now. Instead, a number of lesser-used woods are being specified more often, including oak, which is specified by twice as many designers now (22 percent) versus two years ago (11 percent); walnut, which has increased from 3 percent in 2010 to 9 percent in 2011 to 13 percent today; birch, which is now specified by three times as many kitchen designers as it was a year ago (15 percent vs. 5 percent), and bamboo, which has doubled from 5 percent last year to 10 percent now. While alder is currently specified by 27 percent of kitchen designers, that figure is down from 30 percent last year and from 40 percent two years ago.

Darker Finishes

Natural kitchen cabinetry continues a steady move toward darker finishes. While light natural finishes have been recently specified by 30 percent of kitchen designers, medium natural finishes stand at 55 percent, with dark natural finishes at 58 percent. Two years ago, dark natural finishes were specified by only 43 percent of designers. Among painted cabinetry, white continues to be the most popular option, as white cabinets have been recently specified by 59 percent of NKBA member kitchen designers. Another trend to note is that distressed finishes are making a comeback.

Glass Backsplashes

Although glass remains a niche material for kitchen countertops, it’s been used recently by more than half of kitchen designers as a backsplash material, rising from 41 percent a year ago to 52 percent now. This trails only natural stone tile at 60 percent and ceramic tile (including porcelain), which has been specified of late by some 74 percent of designers. Even at that high rate, ceramic tile backsplashes are on the decline, as they stood at 78 percent a year ago and 88 percent two years ago. Other popular backsplash materials are granite at 30 percent and quartz at 20 percent.

LED Lighting
Energy-efficiency is clearly not a fad, but a real trend that can be seen taking hold in homes across the United States and Canada. Despite the higher initial cost, light-emitting diode (LED) lighting is proof of this trend. Specified by 50 percent of NKBA member kitchen designers entering 2010, that rate increased to 54 percent the following year and has jumped over the past year to 70 percent. However, compact fluorescent lights (CFLs) aren’t sharing in this trend. Although they use roughly a quarter the energy of an incandescent bulb when producing the same amount of light, measured in lumens, the poor color of the light they produce and the presence of mercury in these bulbs are keeping them out of newly remodeled kitchens, falling from 36 percent last year to 26 percent today.

Pull-Out Faucets

Pull-out kitchen faucets have become established as the dominant type of kitchen faucet. Designers are increasingly eschewing the standard faucet with a detached side spray in favor of pull-out models that integrate the two functions into a single unit. The use of pull-out faucets has increased from 88 percent to 91 percent to 93 percent. In other words, 14 of out every 15 designers who designed a kitchen over the final three months of 2011 incorporated a pull-out faucet. These versatile models might also be mitigating the need for pot-filler faucets, which have recently been specified by just 28 percent of designers, down from 41 percent two years ago.

Source: nkba.org

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February Reveals a Slow, Steady Path to Recovery

February 24, 2012 3:50 am

Yesterday, Freddie Mac released its U.S. Economic and Housing Market Outlook for February, showing cautious signs of the economy and housing market moving in a positive direction. The report attributes this good news to the current environment of low interest rates and more favorable job prospects.

Freddie Mac compiles data on major economic and housing and mortgage market indicators and offers forecasts based on those indicators. Highlights from the report include:
  • Job gains exceeded expectations for the past two months, but those leaving their jobs voluntarily were 2 million in December compared to the pre-recession average of 3 million, reflecting worker uneasiness.
  • The unemployment rate fell to 8.3 percent; and weekly unemployment benefits applications decreased for the third consecutive week to 348,000, the fewest since the first week in March 2008.
  • More warmth is expected in the housing market sometime in 2013 as the economy continues on its slow path to a stronger recovery in a low-interest-rate environment.
  • Low mortgage rates will continue to keep homebuyer affordability high and help drive more HARP refinances.
  • Consumer sentiment weakened in January although home builder confidence continued to show signs of growth.
According to Frank Nothaft, Freddie Mac, vice president and chief economist, "The U.S. economy continues to build on the momentum from the end of last year. Our outlook anticipates gradual but steady improvement in the economy and the housing market, supported by low interest rates and brightening job market prospects."

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