Who is at fault

We have all heard a lot about the economy in the past few months. The crash of the financial system, the downfall of the auto industry, and the disaster in the mortgage and real estate industry. Who really is at fault in all this? I am sure the answer many years from now will say the fault is many things that combined to cause the crash.

Let me suggest just one thing that caused it - Greed. It does not matter what area you are looking at, whether it is the financial institutions, the stock market, the mortgage industry, or the real estate industry - the answer is greed. Everyone wants to make as much money as possible as quickly as possible.

Let me give you one of many examples:

- a man is from a third world country (he does speak English).

- he wants part of the "Great American Dream" to own his own home.

- his income is $1500 month and will not change much.

- he has a little money saved up.

- he wants a home even though he has a place to live provided by his employer.

- oh yes, he is single and will always be single (part of his job description).

- he finds a 6 bedroom house for a reasonable price.

- he makes an offer through a real estate agent who knows what his income is.

- a mortgage agent gets him a loan (how I do not know).

- his payment on the mortgage is $500 more that his income.

- he allows relatives to use the house as a type of group home - against zoning codes.

- all works out fine for a while.

- he gets greedy and buys another home for even more money - his income has not changed.

- now, he has over $500,000 of mortgage with an income of $1500 per month.

- his relatives move out leaving him with the 1st house.

- he is renting the 2nd house - unknown the income from it.

- he rents the 1st house to someone who runs group homes.

- the rent on the 1st house is less than his monthly payments.

- the utilities stay in his name.

- eventually the city tells him to stop the illegal group home.

- now he finds out the utilities have not been paid for some time.

- he now owes the mortgage, the back utilities, and is way over his head.

- he is about to loose the house and more.

Observation one - he should have never been given the original mortgage for the home. It appears that the real estate agent and mortgage agent just wanted their commission.

Observation two - he did not know or understand what he was doing when he purchased the two homes.

Observation three - he does not understand the landlord tenant laws of the State of Washington and how much trouble he can get into by doing things wrong.

Who do we put the blame on: the home owner? the real estate agent? the mortgage agent?

Well, I have to put the blame on all three but mostly on the real estate agent and the mortgage agent. They both should have told him that he could not afford the home or the mortgage.

The outcome was very predictable - even without the current economic crash.

Yes, I know there are good mortgage agents and good real estate agents out there. Unfortunately, we do not hear a lot about them. It is the greedy ones we hear the most about.

Some of my fellow real estate agents will not like what I have said. Unfortunately, in the recent real estate boom, it created a lot of greedy agents.

Satellite Dishes - did you know...

You are a tenant of a residential building and you want to mount a satellite dish on your balcony. Is this allowed?

Well, the answer appears to be yes.

You have the right to receive satellite transmissions independent of any wiring in the building or existing cable deals between the owner and a cable company, exclusive or not. Since 1996, the year the Federal Telecommunications Act was passed, landlords cannot unreasonably interfere with a tenants' right to mount an antenna within their exclusive rented space. You should become familiar with the specifics of this rule by going to the FCC Web site www.fcc.gov and typing "Over-the-Air Reception Devices Rule" in the search box.

Say NO to more governmental control...

It has come across my cyberdesk that the City of Everett is trying to join other cities around the Puget Sound Area in forcing "Inspections" on rental property. This is being done as a way of creating additional taxation for the City by using the excuse that the city is protecting its rental citizens from "slumlords." This is not the way to have better, safer, and cheaper housing in our communities. In fact, it is probably illegal under the Washington State Constitution.

It is believed that "Inspection Programs" constitute warrantless searches and violates the Fourth Amendment of the U. S. Constitution. Tenants are not second class citizens whose privacy rights may be violated. Local governmental agencies should not have unlimited access to rental housing. In 1994, the Washington Supreme Court, in McCready v. City of Seattle, unanimously struck down the City's assertion that it was legal to search a rental unit using an "administrative search warrant" issued by the City Municipal court without probable cause of Criminal activity.

We believe the cornerstone of safe housing is not inspections, but education. Informed tenants who understand their rights and responsibilities will protect property. Informed landlords will reciprocate to safeguard the welfare of a tenant who respects the property.

Furthermore, Inspection programs are costly to administer. Additional cost imposed on housing providers will only increase rents and make it more difficult for low-income tenants to find affordable housing. Tenants ultimately pay the cost.

The majority of rental owners are responsible citizens and landlords who equate the well being of their property with the welfare of their tenants. The rights of these responsible owners, and their tenants should not be compromised in an attempt to punish the irresponsible behavior of a tiny minority of landlords.

Existing state law and local housing, fire and health codes are sufficient to remedy any unsafe conditions that are found to exist. Problem properties will only be improved, and hopefully eliminated, by the consistent application of existing law and code by responsible local government entities.

The City of Everett already has an effective Crime Free Program with responsible rental property owners. A task force should have been created to discuss Everett rental housing concerns and issues. Unfortunately, and very disappointing, the City of Everett did not reach out and work with landlords before the introduction of this ordinance.

We all need to contact the Everett City Council and tell them NO to inspections. Below is a list of Everett Council contacts:

Everett City Council
Council Member Paul Roberts, T:(425) 257-8703, PRoberts@ci.everett.wa.us
Council Member Mark Olson, T:(425) 257-8703, markolson@ci.everett.wa.us
Council Member Arlan Hatloe, T:(425) 257-8703, AHatloe@ci.everett.wa.us
Council Member Ron Gipson, T:425 257 8784, rgipson@ci.everett.wa.us
Council Member Drew Nielsen, T:(425) 257-8703, DNielsen@ci.everett.wa.us
Council Member Brenda Stonecipher, T:(425) 257-8786, BStonecipher@ci.everett.wa.us
Council Member Shannon Affholter, T:(425) 257-8703, saffholter@ci.everett.wa.us

Regulation of our rental housing should be governed by reason - not greed. There is no need for this ordinance as there are other ordinances and codes that already regulate the rental housing industry. We do not need nor want more governmental control of our lives.

The Center of the Universe

Some say the "Center of the Universe" is just North of the Fremont Bridge in Seattle. I do not know if the science community would agree but the Fremont area is a special and unique area of Seattle. There has been a lot written on the web and print about Fremont. I will write about this community as well as Ballard, Magnolia, Queen Anne and the Green Lake area in future entries.

Fermont used to be make up of artist and free thinkers of all kinds. This was good, and it made the area a popular tourist stop. People wanted to see the troll, the Russian rocket, and the statue of Lenin. Yes, Freemont has a real statue of Lenin saved from destruction.

Now it not only is home to these free thinkers but the home of Adobe Systems, a large software company. The tech revolution has brought a change to Fremont - some good and some not so good.

One of the not so good changes is the limited parking, increase in restaurants and bars that have brought people into the area in the evening taking up the parking for those who live there. The city just changed the rules - be sure to read the parking signs and have the proper stickers if you park there between specific hours. The web site at the bottom of the blog entry will tell you all about the parking changes. If you are going to visit Fremont don't let the parking troll get you. Your car may end up like the VW bug under the bridge.

Some of the festivals that Fremont is known for are the:

Solstice Parade in June

Fremont Fair in June

J. P. Patches & Gertrude in August

Fremont Oktoberfest in September

Trick or Treat in Fremont in October

Fremont is a wonderful place to visit with small unique shops, places to eat, and things to do. The History House is a favorite for many.

Here is a web address to get the latest news on Fremont. It is well worth your time to explore this site. I will, from time to time, talk in more detail about Fremont as it is a popular place for people to move to and commute into downtown or to the nearby universities.

www.fremontuniverse.com

A Better Light Bulb

Reading one of my favorite blogs - The TinyHouseBlog.com - I found out that there is a new light bulb. Hmmm... I wonder if that is like a "better mousetrap?" Fortunately, one of my wife's brothers is a electronic genius and I have been made aware of LED technology for some time. I even have a flashlight that uses this new technology and see taillights on cars using them. Now we can use them in our home. Yes, I am talking about LED lights.

Ok, Why use them? Because a well designed LED will use over ninety percent less watts to generate the same amount of light than the old incandescent light bulb. This savings is really staggering and will have a great impact on the amount of electricity that we use. Guess what - less natural resources will be needed to to generate electricity. The new light bulb also does not generate heat. It is made in either 12 volts DC or 120 to 240 volts AC. Another advantage of these lights are for those who are interested in / or using solar lighting systems.

I would think that no matter the cost of the bulbs they will definitely save money by using less electricity. Will your builder use them - I don't know. Can we adapt them to our old homes - I hope so.

I just learned about them and I know I will be doing some research on them for my own use and I will blog about them more later on.

President's stimulus plan

Will the President's stimulus plan help you?

From reading about yesterdays announcements it appears there are two types of people they are trying to help. If you fit into one of these two groups the stimulus plan may help. 

As I understand the Presidents program the two parts of the program are:  1 -- loan modification and  2 -- loan refinancing. 

As I understand what has been proposed the loan modification is aimed at folks that are in deep mortgage financial trouble. Their monthly mortgage payment far exceeds 31 percent of their pre-tax monthly income. This program is to provide government subsidies and incentives to financial institutions so they can cut their interest rate and possibly lower their principal, and  stretch out the mortgage to bring the monthly payment down to 31 percent of their pre-tax income. This sounds good. My questions are: Will the Mortgage Financial Institutions agree to this and then actually do it. And then will there be some oversight to make sure the Mortgage industry follows the new rules?

The other group that is about to be helped are all of us who are going under water -- We are already slowly drowning.  This group of homeowners are current on their payment. Their monthly payment is 31 percent or less of their pre-tax income. They'd like to refinance to take advantage of a 5 percent interest rate, but they can't because the value of their home is at or slightly below what their mortgage is. So, the mortgage might be 105 percent of the value of the home and shrinking. They'd like to refinance, but can't because their current mortgage is more than what their home is valued at. 

So, when will we be able to get a piece of paper and fill something out and be able to make this work for us? According to the fact sheet released by the White House yesterday, the details of this program will be announced on March 4th, next month, and we are going to be able to call our lender and say, 'Am I eligible for a loan refinance or modification?' In the meantime, we need to get all the financial documents in order and get ready to call our lender.

Will any of this help? Let's hope so but only time will tell.

Having a Bad Day?

Everyone has a bad day. How can you help but feeling down once in a while with all the bad news - layoffs everywhere, stock market down, housing market way down, the economy is a total mess and headed for a depression (if we are not already there). We all need to laugh once in a while. They say that if one smiles and laughs often the body creates good chemical that keep us going. 

The following pictures were taken and sent to me by Frank Ayers (who has the copyright on the images) and  Paul Reynolds who took the first picture of the series. The pictures were taken at some fish pens of a commercial fish farm on the Columbia River. 

When I read the email with the pictures I could not stop smiling and laughing. That night I showed the email to my wife and I thought she was going to have a heart attack because she was laughing so hard it took her breath away. 

If you are having a bad day I hope this brings 

a smile to your day. You could be like this "poor burd."

"Ain't I a Purdy Burd . ."

"You didn't think that I was hang'n around the fish pens just to have my picture take'n, did ya . . ."

Oh oh,  Water Landing . . .       Not Good ! . . . .     Do I look like a duck . . .

"This is embarrassing . . . "

Have a great day and Keep Smiling :)

Only in Seattle - Enjoying the Sun

I had to go to the Post Office earlier today and two things struck me as being very Seattle. It is partly sunny and in the temperature is in the low 50's. This in itself is a welcome change although it is what this brings out of the woodwork that seems to bring smiles to our faces.  

The first was two teenage girls sitting in lawn chairs on their front lawn. The two girls were reading and watching people and traffic go by. They were bundled up in blankets and had winter coats and hats on. Yes, when the sun comes out this is one way to enjoy the nice weather in the North West. 

A few blocks later I came to a stop at a red light by a Mazda Miata Sports car with the top down and the radio playing loud music. The driver was bundled up in warm clothes and was smiling as he drove down the road. 

On the way home I had another car - I 1966 GTO Convertible - pass me going the opposite direction. Again, the top was down and the driver was smiling from ear to ear as he drove down the road with the GTO's exhaust sounding of "muscle power" that only a 1060's muscle car can do. 

This phenomenon is not unique to this area as Americans love of their car has been well documented. With the cost of gas on the increase the type of cars we drive will change although our love for the Muscle Car will always remain. 

Graffiti

A few years ago my wife and I spent two weeks in Germany. One of the things that really caught my eye (you couldn't miss it) was the Graffiti. It was everywhere - the train stations, bus stops, most of the walls. It was quite the contrast to the country as a whole which was basically litter and junk free. It was a shame to see such vandalism to a beautiful country. 

OK, what does that have to do with Puget Sound living. Well, the City of Renton has decided to "Wipe out Graffiti" within its boundaries. Yes, Graffiti is now against the law and even parents can be held liable for what their kids do. What a new concept - being responsible for your kids. Oh well. 

I wrote the following for the "UPDATE" which is the Monthly newspaper for the Rental Housing Association of Puget Sound. By the way, if you own rental property you need to belong to this organization. They can be reached at www.rha-ps.com.

Here is Renton's new ordinance. I hope it works.

City of Renton launches “Wipe Out Graffiti” Campaign

Graffiti, we all have seen it on a building walls, fences, underpass walls, and signs. Some of us have even been victims of it. The City of Renton officials have determined they are going to wipe out Graffiti and reduce damages inflicted on property owners.

The cities new Graffiti Control Ordinance is aimed at doing just that. The cities goal is to make people think twice before committing an act of vandalism by making them pay. Here’s how.

The Graffiti Control ordinance for the City of Renton:

Makes it illegal to possess graffiti paraphernalia with the intention of using it to deface public or private property.

Allows the court to order those convicted of graffiti vandalism to pay damages to the victim, including the City of Renton.

Allows public funds to be used for graffiti removal.

Allows the city to assign up to a $5,000 liability to the parents of a minor who commits graffiti vandalism.Authorizes the city to offer up to a $300 reward for information leading to the identification and apprehension of any person who commits graffiti vandalism.

People are encouraged to call 911 immediately if they see “tagging” in progress.

The City has hired a part time graffiti abatement coordinator to manage the program and is recruiting volunteers, partnering with local businesses and community members, providing graffiti removal kits to graffiti victims with limited resources, and launching a comprehensive education campaign.

The City has established a graffiti hotline where people can report existing graffiti. The number to report existing graffiti is: 425-430-7373. If you would like to volunteer to help in the city’s program, or would like to donate supplies for the graffiti removal kits call 425-430-6624.