Why wait?

Many have been hearing this in the real estate world, but many still don't understand the significance of the statement.  Even if rates do continue to drop which is highly unlikely, keep in mind the rates of today are so far under the historic average it makes no sense to hold off.  If we combine this with the lower subcontractor costs and lower building material costs, we have a perfect storm in your behalf.  As I have progressed through the years in this business, I have noticed one thing that has always baffled me.  I am always busier when the rates are on the rise vs when they fall.  When my clients have done this, they buy out of fear rather than logic.  I have always tried to counsel my clients to take their time and make this process a methodical one, but when forced to build in a time just to capture a good rate we don't see that happen.  The real estate industry is no different than the stock market, yet people tend to think it is sure fire money maker.  Granted today you will sell your home for much less than you would have a year or two ago, but you are also building a home for much lower than you would have as well.  Like the stock market, you will more than likely make money on your home if you let time be in your favor.  Another idea is the thought of buying bank owned properties.  Many of my clients have started the searches this way and have soon realized that even though they buy at a discounted price, the needed enhancements to the property they are looking at adds cost back to the home as if it where a home sold at the market rate.  We have never seen new home prices be so close to current market prices on comparable homes, so building is a super option to get what you want, have all of your warranties in tact, and have a home live the way you have always dreamed of!     

Financing Information

This week we are excited to have Roxanne Hellickson join our blog postings! 

 

When it comes to choosing your lender, Roxanne Hellickson at Associated Bank gets the job done!  She will meet with you at your convenience.  Nights and weekends too!  Call today – 507-259-2000

 

At Associated Bank, the construction financing process is simple.

Andy at Med City Builders of Rochester, LLC will get me the bids/estimates and plans.

My borrowers provide documentation for income and downpayment along with a complete application

I, as your lender, take the paper work and get it processed and approved.

It’s as simple as that!

 

*One set of closing costs

*Long-term rate locks

*Interest rates at historical lows

*Interest only- payments during construction

*Loans available to fit your financial situation

*Local decisions – we drive the process.  We know our customers and our market area.  We process and service your loan locally!

*Commitment – We do all the paperwork for you!  Fast turnaround time from application to closing!

 

 

Call Roxanne Hellickson at Associated Bank 507 259 2000!

Mechanicals (Part 2)

Today I'm going to touch base on a misunderstood system in the new homes builders are constructing with the most recent code changes.  Radon systems are and are not considered part of the homes mechanical systems.  In the homes I build, I consider them a vital part of the homes ability to reduce moisture so I feel like they are much a part of the homes mechanical system.  In most homes built today, builders are only installing passive radon systems.  Therefore, they are not really part of the homes overall mechanical system. 

There are 2 ways in which the MN code allows builders to install the required systems.  The most simple and the most common system used by builders is to install a passive radon system.  By doing so, the builder is required to have either a vent-mat over clean sand in the sub-floor of a home or pea-gravel.  Both allow the radon gas to freely flow under the concrete slab of the home to a point where it can escape.  With this, the builder is required to run the vapor barrier under the concrete as well to the perimeter and overlap all of the seams.  They must also install a pipe that is typically run from the homes sump basket to the exterior of the home.  Most commonly, this pipe is run through the attic of the garage where it is more accessible in case a future fan needs to be added to the line to activate it.  With a passive system, the home relies solely on the theory the radon gas will just find its way out. 

The other and what I feel is the best solution is to install an active radon system to the home.  By doing this, I simply do what was mentioned above and add a fan to the pipe as it leaves the garage attic.  I have also added another item to our radon system which has greatly enhanced the benefits of the code requirement.  In the floors of our homes before the concrete is poured, I install drain tile lines that run every 15 feet through the center of the home as well as around the perimeter.  These exterior drain tile lines are run to the sealed sump baskets and the basket is what I've used to run the radon pipe to the exterior.  What I have found is that the added drain tile lines drastically helps cut down on the pressure in the sub-floor of the home which is a huge contributor to creating condensation.  Condensation is typically what makes a basement feel uncomfortable and colder than the rest of the home.  To me the radon system not only has the benefit of removing an unwanted gas, but also acts like a supercharged dehumidifier.  The other benefit I have found is that with a fan constantly running in the attic of the garage and constantly pulling air from the footings of the home, it creates a dryer foundation.  In reality, it creates a sponge factor in times of huge rain falls making it less likely to have water enter into the homes in such events.  A local inspector tried this system in his own home and the theory held true.  He had the active system running in his home for 3 years without his dehumidifier turning on.  He unplugged his radon fan and the dehumidifier started to run within days of turning off his system. 

Like mentioned in earlier blogs, if we can control temperature and pressure we can control condensation.  If we can control condensation we are on our way to a much more comfortable home.  Never hesitate to call or email with any added information needed. 

Mechanicals (part 1)

Winter is here and there is no better time to talk about our homes ventilation systems.  The cold is fast approaching and I thought I'd touch on two vital air movement systems in our homes to prepare for it.  I plan on going over the homes air to air exchanger as well as the homes furnace with hopes you can use both with confidence and give you the assurance of a more energy efficient system. 

Your furnace is the heart of your home.  It is the way to supply heat as well as deliver more comfortable air to the interior of the home.  The single most important thing we can all do with our furnaces is change air filters frequently.  I don't recommend buying expensive filters rather just changing them more often.  Expensive filters only make the furnace work harder to move the air.  I always recommend to my customers  leaving the furnace fan on throughout the entire year.  It has been proven that running the fan constantly uses the equivalent energy as 2 light bulbs, but it greatly reduces the amount of gas consumed by the furnace.  This will cut down on your energy costs. Regardless if it is winter, spring, summer, or fall this holds true. 

Air flow on the furnace creates a more balanced home when it comes to the temperature which in turn leads to lower humidity.  Humidity is caused by temperature differences as well as pressure differences.  If we can eliminate both, we are well on our way to a more comfortable home.  In a home with a 2 zone system, you are able to change the dampers on the furnace to control the amount of air flow to a certain area.  While auto systems are nice, manual systems offer similar results and are much more cost effective to install.  With warm air rising in a home, I recommend pushing more of the air flow to the lower of the 2 zones on the furnace come winter.  I simply reverse this in the spring when we get ready for the air conditioning to take over.  Air movement that is controlled by zones allows us to create a much dryer and more evenly heated home.  

There are two types of overall heating systems that can be installed in a home.  A Balanced(air to air exchange system) and a Forced Air heating system.  The balance system is what I recommend and what is typically installed in my new homes.  The air exchanger is a mechanical way to replace dirty air in your home.  They should only be run continuous in the winter months as we close windows and stay in doors more often.  What they do is pull cold air from outside and push the warm, moist, dirty air from the inside of the home.  As these two things are happening they cross paths in the air exchanger and the warmth of the air leaving is extracted and added to the cold air coming in.  This is what makes them a more efficient way to replace the air leaving the home.  Forced air heating systems are still commonly put in by builders today for the cost savings, but only rely on the fresh air intake pipe in the basement to replace the air needed.  If it is 30 degrees below zero outside, that same temperature of air is entering into the home.  The only time an air exchanger should be run in the summer is when taking a shower, bath, or doing laundry.  Even then, the buttons you press in these locations will only turn on the system for about 15 minutes.  Keep the name as simple as it is.  Air exchanger simply exchanges air.  We want and need to do this in the winter when we have a dirty air environment, but don't want this to happen in the summer when we have paid top dollar to cool and condition the air.  We would not want to exchange this expensive air for the humid hot air outside during summer.  It has been proven that exchangers cut down on sickness too.  They where designed for efficiencies and have delivered this benefit to us as well! 

They do require some maintenance, however.  Typically they have 2 filters in them to prevent dust from getting into the core of the air exchanger.  They need to be cleaned monthly and should be done as a habit when you change your furnace filter.  If you simply vacuum or tap out the dust in the filters, they will give you years of worry free use. 

Whether you are a past customer or a possibly looking to build a new home, I'd be more than happy to walk through this in person to further elaborate on both of these vital systems in a home.  As always I'm looking for ways to cut down on energy consumption, while bringing the most comfortable environment to a home possible. 
 

Your home is an envelope

Back again for another round of the discussion board.  Today I thought I'd add on to what was discussed in the previous blog.  Energy Star ratings of a home are heavily dictated upon the homes envelope.  The term envelope is a pretty relative term which takes on a pretty important meaning when it is used in new homes.  What it is, is the entire sealed compartment within the walls of the home.  The moisture barrier and other products are used to create this.  With the strict energy codes along with even stricter guidelines by my company it must be as tight as possible.  We start creating the envelope of the home as we start the framing process.  As exterior walls start to go up, we apply house wrap which helps keep the elements from entering into the home.  As we start to add interior walls, I make sure all the walls running into the exterior walls have pre-poly.  The reason for this is to have a seam for tying in the rest of the poly once we have past the point of insulation.  Most builders don't do this vital step and rely on the caulking of the poly to the actual wood members where the inside walls meet the outside framed wall.  Proper install of the windows is also a vital part of this.  80% of all moisture damage in a home comes from windows if not installed correctly.  Once the home is framed, the mechanical systems are assembled and installed.  Many holes are cut inside the home and penetrations are added through the exterior walls.  These are vital areas to be sealed back up prior to the install of the insulation and poly that covers it.  Heat, moisture, and air are all able to flow through these areas unless it is prevented.  Now its time to  be insulated.  Insulation may seem like a pretty simple task, but the way it is put in is one of the most watched over areas in my inspection process.  Much to what people might think, more is better when it comes to insulation.  Small voids in the insulation allow heat to transfer and thus creating possible condensation points in the home.  I plan on touching on the differences between spray foam and fiberglass insulation at a later date.  After insulation and inspecting for the possible voids, we move to the next step.  That's where the poly comes into play which most consider the true envelope.  If not installed proper, this can lead to major moisture concerns down the road.  Hundreds of gallons of water per year can escape from the smallest of holes in the poly if not repaired.  Many misconceptions have led people to believe that a new home should breath and there should be holes in the poly barrier of the home.  This is the farthest thing from the truth in the way homes are constructed today.  Air flow creates moisture and moisture creates major problems if not controlled.  This has been the leading factor in my decisions to install air to air exchangers where applicable.  If we can't rely on the walls or windows to bring in fresh air or lose moisture, then we need to do it mechanically. 

Properly running air exchanges removes the homes dirty moist air as it builds up and replaces it with cold fresh air from the exterior.  Air exchangers are designed to be run in the winter and off in the summer and should have its filters cleaned as often as the furnace filter.  Spring and fall we typically have windows open which itself acts like a passive air exchanger.  The efficiency of the air exchange unit is my primary reason for installing.  The fact it can pick up heat from the air leaving the home and mix it with the cold air coming in gives it this efficiency.  That is where the exchanger part of the name came from.  One of the major bonuses it also creates is a healthier environment. 

A homes envelope is much more complex than this, but I hope I have helped uncover some of the most important aspects of it.  The bottom line is to keep a home that is built in today's energy conscious environment as tight as you can.   

I plan on touching base on all of my homes mechanical systems as this blog progresses.  Feel free to add any ideas you might want to cover as well.  Thanks for reading!       

Energy Star

Today is the first day of a construction blog for all of my past clients as well as prospective clients into the future.  Any input is appreciated and will be taken to heart, so feel free to address anything you feel is relevant to discuss. 

In today’s blog, I thought it would be easiest to start with the mission my company has sought out to adhere to.  “Green” building has taken such a dominant role in my industry, yet so many people have a tendency to forget the meaning behind it.  One of the core concepts behind “Green” building is to use less of our resources to achieve a goal that allows us to conserve valuable energy in the future.  One of the largest road blocks for my clients is to incorporate “Green” building into the home yet keep costs to a reasonable level.  One way to measure the effects a home is built against the “Green” building revolution is to conduct on site energy audits.  For the past 2 years, I have worked with a firm to do just that as well as taken numerous courses to further understand the implications of doing so.  The energy audit tests are paid for largely by the local natural gas companies and it allows them to understand what is working in the field as well. 

The actual audit consists of many factors and I’m happy to go into depth on each area to show how each can affect the outcome in future blogs.  The overall report consists of the Address and Builder of the home, the actual Energy Star Rating, the Tax Credit Status, the HERS Index, the Home Performance Testing Results, and the information on the Mechanical Equipment. 

The Energy Star Rating lists the pass/fails and is a good overall impression on how well the home was built in accordance to the requirements.  It lists whether or not the home meets the requirements, the HERS index which I will explain below, and pass/fail of the air duct leakage.

The Tax Credit Status gives the percentage over what the 2004 IECC requires.  Homes with a score of 60 would often have a rating 55% better than the 2004 IECC requirement.  Homes over 50% may be eligible for the 2005 EPACT Federal Tax Credit.  As a builder, there are advantages of meeting these requirements.  Although I pay more for a home to meet all of these, I am typically able to receive tax credits from the Federal Government by doing so.  This is on a per home basis.  We all win with this concept of building greener! 

  

The HERS Index scale I referred to above is a linear metric where every percentage point that a building’s energy use is reduced represents a decrease point reduction on the index.  In simple terms, the lower the HERS score the less energy a home will use.  A new home by the United States standards typically meets a HERS score of 100.  The Energy Star rating is at a score of 85.  Most of the new homes built today are above the Energy Star rating meaning they are using too much energy to pass the requirements set by the test of being considered Energy Star worthy.  The past 2 years tests on my homes have shown an average of just fewer than 60.  Homes in 2012 are more than likely going to be required to be at the Energy Star rating of 85 and homes built in 2020 are more than likely going to need a score 65 to 70.  Meaning, the homes I build today are built 25 points on average better than an Energy Star home of 2010 and 5-10 points better than homes 2020 are required to follow.  Therefore I feel that my homes under construction today are surpassing the goals of 2020!  The best score a home can achieve is a 0.  That means a home uses no energy.  While this is possible today, the costs far out way the benefits achieved from such a low score.    

The Home Performance Testing Results offer blower door testing, air duct leakage results, and ventilation flow results.  These results are a very important part of a homes overall test result.  The homes blower door testing allows us to see where the air flow is being lost inside the walls of the home.  Proper insulation, fluffing of what seems to be minor gaps in the insulation, pre-poly where the interior walls meet exterior walls, very tight seals on all poly transitions, caulking of the bottom and top plates, and overall proper caulking of the poly is all part of what contributes to the effectiveness of this test.  Too much air leaking from ducts significantly reduces the efficiencies of the homes heating systems.  It would do me no good to install a 95.1% efficient furnace if the ducts leaked all of the air flow. 

The Mechanical Equipment is the final piece of this complex puzzle.  It is a very useful tool to see all of the manufactures names and what types of ratings they all have. 

With all that is being done in today’s “Green” movement, it is easy to see why an Energy Star audit is so vitally important.  Too many people assume by doing one or two major things (Geo-Thermal, Solar Panels, wind power, etc.) they can consider their home “Green”.  The stance I have taken is to find a way to build a home that is extremely energy conscious, yet doing so with as minimal of a cost to the end consumer.  This is the standard of Med City Builders of Rochester and not an added cost.  There is no need to spend tens of thousands of dollars on a home to consider your home part of the “Green” movement.  I have installed an array of expensive systems that in the end don’t see the payback they claimed to provide.   

Stay tuned for more information in my future blogs.  I plan on going on a step by step basis to explain how heating/cooling systems are best cared for and operated in the next blog.  As my past clients know, I spend a great deal of time explaining this in my pre-walk through, my final walk through, my 30 day beyond completion walk-through, and my 1 year beyond completion walk-through.  I felt this would be a useful tool for people to better understand on how their homes systems can be used to their benefit in lowering the ever increasing energy costs.  Thanks for your patronage!

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