Fixing Up An Historic Home : The Three Rs

If you enjoy both history and fixing things, then you may have trouble driving by historic homes for sale in Minneapolis without feeling the urge to buy and fix one up.

Before you do, however, you should know the three R's of fixing historic homes -- Restoration, Renovation, and Repair.

Restoration
"Restoration" is the process of returning a home to its original state. Restoring historic homes often requires city and state permission. It's essential that you check to see whether your home is listed in the National Register of Historic Places (NRHP); or, whether it's located in a historic district. If either is true, there may be a specific set of rules to follow while renovating.

Restoration can be an expensive endeavor. For a home to keep its historic value, the materials used must match the home's original materials, including furnishings. This can be costly because of antique value.

Renovation
Renovating is less complicated and less restrictive as compared to restoring. However, via a renovation, a home often becomes a more "modern" living space, which can lower the home's historic value. Be sure that your home is not listed in the NRHP or located in an historic district before beginning renovations.

Depending on size of the project(s), renovations can be expensive, too. However, it's easier to find great deals on modern appliances as compared to the antique appliances required for a restoration.

Repair
Repairs are often less intensive than a restoration or renovation. For repair, be sure to use materials which fit the home's character, which may include plaster walls and wooden floors, for example. Matching original materials is not important in the home repair process..

The cost of a repair project will depend on the size and volume of required repairs.

The differences between a restoration, renovation and repair of an historic home may be minor, but those small differences will change your costs, your timeline and your procedural red tape. Speak with an qualified architect if you're unsure of your obligations as the owner of a historic home.

Case-Shiller Index Posts 4% Annual Home Price Gain

The U.S. housing market continues to make home price gains.

Earlier this week, the S&P/Case-Shiller Index showed home prices gaining 4.3 percent during the 12-month period ending October 2012, marking the largest one-year gain in home prices since May 2010.

The Case-Shiller Index measures changes in home prices by tracking same-home sales throughout 20 housing markets nationwide; and the change in sales price from sale-to-sale. Detached, single-family residences are used in the Case-Shiller Index methodology and data is for closed purchase transactions only.

Between October 2011 and October 2012, home values rose in 18 of the 20 Case-Shiller Index markets, with previously-hard hit areas such as Phoenix, Arizona leading the national price recovery.

The top three "gainers" for the 12 months ending October 2012 were :

• Phoenix, Arizona : +21.7 percent
• Detroit, Michigan :  +10.0 percent
• Minneapolis, Minnesota : +9.2 Percent

Only Chicago and New York City posted annual home value depreciation. On average, homes lost -1.3% and -1.2% in value, respectively.

It should be noted, however, that the Case-Shiller Index is an imperfect gauge of home values

First, as mentioned, the index tracks changes in the detached, single-family housing market only. It specifically ignores sales of condominiums, co-ops and multi-unit homes. 

Second, the Case-Shiller Index data set is limited to just 20 U.S. cities. There are more than 3,000 cities nationwide, which illustrates that the Case-Shiller sample set is limited.

And, lastly, the home sale price data used for the Case-Shiller Index is nearly two months behind its release date, rendering its conclusions somewhat out-of-date.

That said, the Case-Shiller Index joins the bevy of home value trackers pointing to home price growth over the last year. The Federal Housing Finance Agency (FHFA), for example, reported similar home price growth with its October 2012 House Price Index (HPI).

Home values rose 0.5 percent between September and October 2012 nationwide, the FHFA said, and climbed 5.6 percent during the 12 months ending October 2012.

Economists attribute increasing home prices to higher buyer demand, record-low mortgage rates and the gradual improvement of the U.S. economy.

How To Install A Water Heater Jacket

A simple way to save money is to improve your home's energy efficiency rating.  For example, Minneapolis homeowners can save up to 9 percent per year on water heating costs simply by installing a water heater jacket.

Water heater jackets are easy to install. Here's how you do it :

First, before you go shopping, check whether your water heater is a gas model, or an electric one. Then, write down your water heater model number. Most water heater jackets list compatible water heater models on their respective packaging. Look for jackets with a value of "R-8".

Then, as you start your project, be sure to turn the water heater off.

Water heater jackets are pre-cut to make installation simple. Remove the outer packaging and separate the jacket's pre-cut pieces. There will likely be a top, a body and belts. You'll want to have plenty of duct tape on hand, too.

Next, shape the top of the water heater jacket to fit your appliance.  Trim around the pipes which enter the water heater, then tape the areas closed. This will form a strong seal.

Tape the top edges down to the side(s) of the water heater.

Then, take the body of the water heater jacket and wrap it around your water heater's mid-section. Have the belts ready and secure them, taking care that the belts don't push the insulation down more than one-quarter of its thickness.

Lastly, outline the access plate with a pencil on the insulation exterior, and use scissors or a knife to cut the insulation out. Tape the edges to avoid fraying and set the water heater to a temperate no higher than 130 degrees.

Note that outfitting a gas water heaters with jackets can be more complicated than with electric water heaters because of construction. If your water heater is a gas model, consider hiring a professional to handle your installation.

What's Ahead for Mortgage Rates This Week: December 24, 2012

Mortgage markets worsened last week amid ongoing discussions budget and tax conversations in Washington, D.C., and the release of key housing and economic data.

Mortgage rates climbed in Minnesota and nationwide.

Freddie Mac reported the average 30-year fixed rate mortgage rate at 3.37 percent nationwide for borrowers willing to pay an accompanying 0.7 discount points at closing, plus closing costs -- an increase of 0.05 percentage points from the week prior.

The average 15-year fixed rate mortgage rate was listed at 2.65 percent nationwide with an accompanying 0.7 discount points plus a full set of closing costs.

With certain government funding and tax reductions set to expire December 31, legislators appear unlikely to avoid what's been called the "Fiscal Cliff". Some economists believe that reaching January 1 with no agreement in place will set the economy in to recession.

Mortgage rates tend to improve on "negative" news for the economy, which partially explains why mortgage rates made a small comeback late in the week.

In other news, according the National Association of REALTORS®, Existing Home Sales reached their highest point since November 2009, climbing to 5.04 million homes sold on a seasonally-adjusted, annualized basis. In addition, the real estate trade group reports that the Existing Home Supply has dropped to 4.8 months -- a figure firmly suggesting a "seller's market".

Separately, the Commerce Department reported single-family housing starts rising, too; down 4.1 percent in November but up nearly 23 percent as compared to November 2011.

This week, Fiscal Cliff discussions are likely to dominate mortgage markets. The trading week will be holiday-shortened and volume will be lighter-than-normal. This may lead to volatile pricing and rapid interest rate movements.

Markets close early Monday and remain closed through Tuesday. Wednesday, markets re-open with no new data set for release. Then, Thursday, scheduled economic news events resume Thursday with New Home Sales, Jobless Claims and Consumer Confidence due.

Friday, the Pending Home Sales Index is released.