June 2017 Newsletter

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Creigh Hill – Owner/BIC

THE 4 S’s:

SEPTIC, STREETS,

UNDERGROUND STORAGE TANKS,

& SQUARE FOOTAGE

 

 

Use the following links to see if your street is State Maintained.

 

If the street is not within city boundaries, then you would contact the District Field Office of the Division of Highwayswithin the NCDOT. You can also search the Division of Highways’ secondary road database by street name at the following link: https://apps.ncdot.gov/SRLookup/.

Caution: searches are very sensitive to the accuracy of the street name; if you cannot find the street or address you seek, contact the local Field Office.

General Information may be found athttp://www.ncdot.gov/doh/.

Be sure if you have a firm license to renew this as well as your broker license.  https://www.ncrec.gov/

 

 

NOTE: When you renew your license, you will be given the option to download and print a copy of your new pocket card. Please forward a copy to [email protected]

 

A message from the Owner Creigh Hill

Christina-Pridgeon

Christina Pridgeon – Southern Homes Insurance Powered By AllCare

The month of May has been great for Southern Homes Insurance.  Not only have we created new processes to make things easier for you and your clients, but we are more active on our Social Media outlets.  Please go to Facebook and like our page using this address- Southern Homes Insurance Facebook Page.  Our Facebook page will give you easy access to information about the agents who are quoting yours and your clients insurance.  It also provides valuable sources for staying up-to-date on the constantly changing insurance world.  This can benefit you and your clients!

 

This month, we’d like to introduce Adriana Mejia. She is one of our bi-lingual Southern Homes Insurance agents who has been in the industry for over 15 years.  She can help you with any type of insurance whether it is commercial or personal.

 

 

Again, thank you for referring business to Southern Homes Insurance. We are a full-service insurance provider who can help you and your clients with Auto, Home, Renters, Commercial, Condo, Motorcycle, Flood, and Boat Insurance, almost everything.  Please visit www.southernhomesins.com or Contact Christina Pridgeon at [email protected] or call 704-751-1900

Wisdom

Wisdom Strikeleather – Southern Homes Title Insurance

 

The Past Can Determine Your Future:

Title insurance is a unique form of insurance. It provides coverage for future claims or future losses due to title defects which are created by some past event (i.e., event prior to the acquisition of the property). These risks are far less obvious than those protected against by automobile insurance, but can be just as devastating. “Unlike other insurance policies, title insurance is a one-time charge.”

 

– Chicago Title Insurance Company

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Karen Patterson – Movement Mortgage

 

This week’s reports on wholesale inflation and a series of Federal Reserve speeches has made one thing very clear: Chances are very good for a rate hike in June.

After increasing its target interest rate in March, the Federal Reserve has stood still in the following weeks. But projections of inflation, employment and other economic indicators continue to make a good case for further increases as part of the Fed’s plan to increase rates three times this year.

On Thursday, markets were surprised by wholesale inflation increasing at a more rapid pace than expected. The Producer Price Index, a monthly reading on the price of wholesale goods, increased by 0.5 percent. Analysts had only expected a 0.2 percent increase.

The increase in wholesale prices were broad-based across industries and supported a trend of rising prices in many sectors of the economy. The annualized 3-month average for the Producer Price Index is now 2.9 percent, a significant increase that shows no signs of peaking.

 

The April consumer price index, released Friday morning, rebounded to a modest rate after an unexpected decline in March. Analysts have been watching consumer prices increase since last summer, and the March dip combined with April’s rebound seem to indicate a more modest pace of inflation on consumer goods.

The CPI advanced a seasonally adjusted 0.2% in April from the prior month, the Labor Department said Friday. Excluding the volatile categories of food and energy, so-called core prices rose just 0.1% from March. Consumer costs have increased 2.2 percent since this time a year ago, marking the second straight month annual gains eased.

This inflation mixed bag (wholesale acceleration and only modest consumer increases) will be on the minds of Federal Reserve Open Market Committee members, who are tasked with keeping employment at full levels while attempting to use monetary policy to keep inflation at 2 percent annually.

Bank presidents: Rate hike seems imminent

Speaking of the Fed, four Fed officials gave speeches this week, a rarity for the usually silent central bank. These speeches, while giving members of the committee a platform for advocating their individual ideas, can also be coordinated to help investors read tea leaves on what moves will be made next.

One common theme in remarks this week is that Fed leaders believe their plans to slowly increase rates and reduce other accommodative monetary policy, such as buying mortgage-backed securities, are on track.

Federal Reserve Bank of New York President William Dudley told an audience in Mumbai, India this week that the Fed will be cautious not to move too swiftly in order not to upset markets. Still, he confirmed strong employment and inflation numbers supported the Fed’s plans to begin unwinding its recession-era policies.

“We are pretty close to full employment,” Dudley said, according to Bloomberg. “Inflation is just a little bit below our target of 2 percent if you look at the underlying inflation trend, so clearly if the economy continues to grow above trend we are going to want to gradually remove monetary policy accommodation.”

Federal Reserve Bank of Boston President Eric Rosengren took an even more hawkish stance. In a speech in Vermont this week, he told investors the economy faced a risk of becoming “over-hot” with the unemployment rate dropping down to just 4.4 percent in April, with rising wages and prices.

He advocated for three more interest rate increases before the end of 2017 and for Fed officials to begin reducing its $4 trillion balance sheet, made up of Treasury bonds and mortgage securities, which it purchased during the recession to provide monetary stimulus to the weak economy.

“This would represent an unsustainable, overshooting pace, and provides an important rationale for continuing the process of normalization of monetary policy that is currently underway,” Rosengren said. “Along with a gradual reduction in the level of the balance sheet, it would still be reasonable to have three rate increases over the remainder of this year, assuming the economy evolves like my forecast envisions,” he said.

Minneapolis Fed President Neel Kashkari and Dallas Fed President Robert Kaplan also gave speeches this week that seemed to fall in line with their colleagues. While Kashkari advocated for tight regulations on the largest banks, and Kaplan spoke about the tightening labor market, neither said anything to go against the grain of additional rate hikes.

What does this all mean for us? As I’ve said all year, gradually rising rates should be expected, even though Friday’s weak consumer price index keeps some rate-increase headwinds in place. I still don’t see a scenario in the near-term that would call for sharp increases, but a June increase is still likely. In general, the market has priced in these trends so I do not see a major change in pricing on the horizon.

The Asian influence

To close our blog this week, I want to pass along an interesting overseas development that reminds us why global economics matter.

This weekend, a number of Asian policymakers will convene in Beijing, China to discuss the One Belt, One Road project, a potentially $500 billion initiative to invest in logistics infrastructure.

Chinese President Xi Jinping first announced the policy in 2013, and it was later named one of China’s three major national strategies. According to a CNBC report, the plan aims to connect Asia, Europe, the Middle East and Africa with a vast logistics and transport network, using roads, ports, railway tracks, pipelines, airports, transnational electric grids and even fiber optic lines. The project involves 65 countries, which together account for one-third of global GDP and 60 percent of the world’s population, or 4.5 billion people, according to Oxford Economics.

This ambitious spending plan, if brought to fruition, would further expand China’s influence in global trade and economics. It would also accelerate economic growth in a number of developing countries.

While this doesn’t affect our economy in the near-term, it’s important to remember the global nature of economics today. If a plan such as this took shape, it would certainly be felt in our trade relationships, the price of goods and services and, yes, even our interest rates and monetary policy.

Make It A Great Day!

Karen Patterson

 

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Karen Edmondson – Denver Office BIC

Land Buying Questions

1. Do you have a topographic survey or grading plan?

When a lot is surveyed by a professional surveyor, you can feel confident in the amount of acreage being sold. A topography survey shows lines at every 1 or 2 feet of elevation change along the site, thus giving you a two-dimensional representation of the site’s slope. This will help you determine a location for a building pad and site access. The survey may also show existing utilities, site features, and trees.
Sometimes sellers have gone through the process of hiring a civil engineer to create a grading plan, which is site plan that shows how the existing topography can be manipulated to create a driveway to a future building pad. This will help you evaluate what it will take to develop a site. Grading can cost tens of thousands of dollars, so the less you have to do, the more you can spend on your home.

2. Are the boundaries clearly and accurately marked on site?

Ideally, corners of the property lines should be marked on the site. These are usually tall sticks or flags that can easily be seen from a distance. In a urban area, the boundaries are more easily discernible with neighboring structures. However, be aware that some existing structures may be encroaching onto the property in questions and a survey will show if this is the case.

3. Are there any Covenants, Conditions & Restrictions (CC&R’s)?

Covenants, conditions, and restrictions – also called CC&R’s – are used by many “common interest” developments to regulate the use, appearance, and maintenance of property. CC&R’s, most commonly drafted and enforced through homeowners’ associations (HOAs), often restrict what the property owner can do on the property.
One of the main restrictions that affects buyers looking to build a home is minimum home square footage. The tiny and small home movement is a new phenomenon. In years past, many CC&R’s set minimum home sizes as a way to protect home values of neighboring homes. The logic is if a 1,000 sf home is built in the middle of 2,500 sf homes, the 1,000 sf home will bring everyone’s home value down.
Another restriction may involve the design of your home. Many tract developments where a land owner subdivided land into lots and is selling them individually have design restrictions to ensure all of the homes built will have a cohesive look. The downside is that the aesthetic prescribed in the CC&R’s may conflict with yours.

4. Is the title to the property clear (free of liens, easements, and other encumbrances)?

Property with a clear title is “worry-free” and far more attractive than property which is encumbered by liens, taxes, or easements. A title company will help you determine this and often the seller has already engaged with a title company, which brings us to the next question.

5. Do you have a preliminary title report?

A preliminary title report is essentially an offer to issue a policy of title insurance covering a particular estate or interest in land subject to stated exceptions. A preliminary title report lists – before you buy a lot – title defects, liens and encumbrances which would be excluded from coverage if the requested title insurance policy were to be issued as of the date of the preliminary report. The report may then be reviewed and discussed by the parties to a real estate transaction and their agents as part of the buyer’s due diligence.
Thus, a preliminary report provides the opportunity to seek the removal of items referenced in the report which are objectionable to the buyer prior to the buyer removing their contingencies.

6. What utilities are available in the area?

Providing utility infrastructure to a site is a significant expense, so it is important to know what is existing and what you will need to provide. There are five main utilities to make sure you understand before removing contingencies during escrow. You will want to know about the following:

  • Power – This could be overhead or underground. Talk to your local power company – in San Diego, it’s SDG&E – and ask how about the process of bringing power to a new home on this site. Even though power lines may be nearby, there is still time required for the power company to survey the site and make the connection.
  • Telecom – Find out what your options are for phone, cell phone, cable or satellite television, and high-speed internet.
  • Gas – Natural gas may be accessible from your local municipality or you may need to use propane tanks. If you are using natural gas from the City or County, just like with power, there is a process to making the connection, so reach out to the local gas company.
  • Water – This may come from a well or from a local water company. Note that installing a water meter is costly, so ask if there is a water meter installed.
  • Sewer – Waste has to go somewhere, so it will either connect to an existing sewer line or a septic system. If there is no municipal sewer line available, you will need to have a septic layout designed. This will involve drilling holes in the ground and a percolation test to determine the absorption rate of soil for a septic drain field or “leach field”.

Another consideration is how far from the future home site the existing utility sources are located. Trenching lines long distances will add significant expense to your project.

7. What are the current taxes on the property?

The seller should know this, but if there is any question, refer to the preliminary title report. It will also tell you the status of property tax payments and the most recent tax on the property. Understanding the annual tax amount will be essential in understanding your ongoing holding costs.

8. Do you have a soils report?

In certain areas, the local jurisdiction having authority of building permits will require a soils report. A soils report – sometimes referred to as a geotechnical report – gives you an understanding of earth conditions. It will guide a structural engineer in designing a home’s foundation. Lots with expansive soils, low strength soils, on steep slopes, or on fill often times require a soils report. If you have a flat lot with good soils, then this report may not be necessary.

9. What is the property’s zoning?

Every property is assigned a zoning type. The lot may be zoned for residential or commercial. If it’s residential, you may be limited to a single home – sometimes called dwelling units – or be allowed to build multiple units. Zoning will also tell you other restrictions like how tall a building may be on the lot and how close you can build to a property line. Talk to your local planning department to determine the property’s zoning if the seller does not know.

10. Are there any other offers on this lot?

You need to know if you are competing with another buyer. Raw land tends to stay on the market longer than a home, because there are less buyers willing to go through the process of building a new home. If there is another offer in on the lot and you really want it, you will need to bring your best and highest offer.
The one good thing about land is that they aren’t making any more of it. If you hold on to it long enough you will see its value appreciate.

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