Written by Mark T Fiedler - The Mark and Sheila Team April 24th, 2013
2 Bedrooms, 1 Bath, 1 Car Garage, 820 Square Feet
This 1 owner home will really impress! Large, low maintenance corner lot with Sandia Mtn view. Compact, comfortable home close to Hwy 550. Easy access to Hwy 25 to Santa Fe or Albuquerque. Wood laminate flooring in kitchen, plus appliances are almost new! Extra insulation installed in house and garage. R30 batt insulation in celing, not blown in. No smoking, no pets ever in the house. 2 portable air conditioners plus 3 ceiling fans provide extra, efficient cooling where it is needed. Come see it!
2 master bedroom suites. One upstairs and one down. Spacious family room upstairs with built in shelves, entertainment center and fireplace. 2nd fireplace in living room downstairs. Upgraded interior with glass tile backsplash in kitchen, tile floors in kitchen and dining room. Huge bedroom and giant walk in closet upstairs. Ideal setup for independent family members or roommate situation. Great option for frequent travelers – easy care yard and security gate.
Written by Mark T Fiedler - The Mark and Sheila Team March 27th, 2013
Q: My house had to be completely replumbed at a cost of thousands of dollars. I was told that inferior pipes were installed by the builder (Amrep). My neighbors are going through the same thing and it’s not the cold weather causing their pipes to suddenly burst. One of the plumbers told me that the cause of all this was actually that the water pressure in the neighborhood was too high. Doesn’t this make the Water Company responsible for all these breakages? We have no way to recoup this tremendous expense as homeowners insurance does not cover this loss. Can you research this problem? PL in Rio Rancho.
A: This is such a common question and concern of Rio Rancho residents, we’re going to spend some extra ink to give you and your neighbors the full story. You did not explain what happened in your home that caused you to replumb it. Usually if a pipe in the wall bursts without outside influence, homeowners insurance companies will cover the loss. They usually won’t replumb the whole house, they’ll just repair the break and any water damage.
Based upon the info you supplied, you probably had polybutylene pipe in your home prior to repiping. Originally referred to as ”The Pipe of the Future”, polybutylene is a semi rigid gray colored plastic pipe which allowed Amrep and other builders across the country to build homes a little quicker and at a lower cost than if they used copper plumbing. Polybutylene pipe had been used successfully in Europe and Asia for many years before a variant of the product was installed in 6-10 million structures in the U.S. The variant used a slightly different material, which was not as durable. In Amrep’s case, during the first few years of use the plumbers doing the installation had issues with making the crimp connections properly. If their tools were not correctly calibrated, they could make too loose a connection, making a future leak likely. If the tool was set a little too tight, they could overstress the pipe at the connection. Eventually microfractures at that joint could become macrofractures, causing a failure. Over time, the installation problems were solved, and the crimp-on connections were changed from plastic bands to copper ones.
The primary failures in plumbing systems in the Amrep homes changed from failures at the crimp connections to mid – pipe failures, often inside walls or under concrete slabs. The theory is that chemicals used to disinfect city water cause a breakdown in the material. The pipes flake and disintegrate from the inside out, making it impossible to know where a failure will occur. It is also known that the pipe does not react well to high water temperatures, usually found within 10 feet of a water heater. Pipe close to the water heater should be copper, or other material which is not so temperature sensitive and then transition to plastic pipe, if that is what you have.
In 1995 a large class action lawsuit against Shell Chemical Company and several other pipe and fitting manufacturers was settled prior to trial and a fund of over $1 Billion was set up to make repairs and to replumb homes that qualified. For many years plumbers put their children through college with the money paid out from this settlement. Not all claims made were legitimate, and there was a lot of misinformation out there. The time for claims to be made under this settlement has now expired, so you can no longer make a claim for reimbursement.
Insurance companies have different attitudes when it comes to polybutylene pipe. Several of the major companies will not knowingly insure a home plumbed with this material. Others have no restriction against it initially, however, if you have a sudden plumbing failure and make a water damage claim, most will pay the claim and then may cancel your insurance policy. If you totally replumb your home with another type of pipe, they may continue to insure the property (unless they determine that the cause of the plumbing failure is likely to reoccur). If you make two water damage claims against your homeowners policy in a five year period, you may not be able to get homeowners insurance at all without paying two to three times the premium amount for a high risk policy. This is one reason to think twice before reporting a loss to your insurance company if the amount of damage is near or below your deductible. They won’t pay you anything and you’ll still get a strike against your claims history.
We talked with Larry Webb, Rio Rancho Utility Division Manager about the water pressure issue. Depending upon where you live, you could very well have higher than normal water pressure at your home. Rio Rancho is hilly in many areas. To get water to homes at the top of a hill, they may have to boost the water pressure at the main. Homes on the same main line near the bottom of the hill would experience higher pressure. Normal water pressure for a home is between 65 and 80 psi (pounds per square inch). According to Mr. Webb, city ordinance authorizes the utility to supply water at between 30 and 125 psi. We have personally seen homes in town where the water pressure was at 125 psi, but never higher. The thing is, if your pipes are in marginal condition, water pressure at the higher range could increase your chance of a leak or an outright plumbing failure. We have actually seen homes where they had a blowout due to high water pressure, had repairs paid for by their insurance company, then had another one within a couple months. To keep this from being an issue, residents where the water pressure is high should consider installing a pressure regulating valve behind the water meter on their main water line. Estimates we got ranged from $250-400 for a plumber to install one. You should also install a thermal expansion tank on your water heater at the same time. When a pressure regulating valve is installed, your home becomes a “closed system”. When you heat the water in your water heater, it expands. If you do not have an expansion tank, this can over pressurize your plumbing, risking damage. This is a $50 part, and takes a couple hours to install. This is cheap compared to dealing with a leak or other plumbing failure, and would have kept the aforementioned homeowners from having a second blowout.
You said that you had replumbed your entire home, but did not share what type of new pipe was used. Here’s a little guidance for your neighbors who might need to do so in the future: There are three types of pipe commonly being used for re-pipes in this area. The gold standard was and still is, Type L copper pipe. This is slightly thicker than type M, and will probably last longer. The cost of copper has shot up in recent years, and proper installation requires some skill and experience, as joints need to be made using solder and a torch. It is pressured rated at 582 psi at 100 degrees Fahrenheit and 475 psi at 200 degrees. If the home is on a raised foundation and the plumbing is in a crawlspace below, be sure to secure the access, as thieves have been known to tear out copper plumbing for the scrap value if they can get to it. Copper pipe is very thermally conductive, and is subject to damage from freezing. The second type of pipe is AquaPex, or Pex pipe, which is cross-linked polyethylene. It is flexible, easy to install, and can often handle freezing temperatures without damage. The joints are crimped in a way similar to polybutylene. AquaPex is rated at 200 psi at 80 degrees and 100 psi at 180 degrees. When used for hot water, if your pressure is too high, you could be exceeding its rated capacity. Most new homes today are being plumbed with this type of pipe. The third type in current use (and the cheapest) is CPVC. It is a white, semi-rigid plastic pipe which is very similar to polybutylene in many ways. It is installed using glue on fittings. It is rated at 480 psi at 73 degrees and 96 psi at 200 degrees. It is sensitive to UV exposure, so it needs to be kept out of sunlight. Over time it can become brittle, so it might not do well if exposed to very cold temperatures. Neither of the plastic pipes should be used where animals or vermin might be able to access it, as they could gnaw through it.
All the plumbers we talked with were in agreement about one thing: No type of pipe lasts forever. While copper pipe sometimes lasts 30-50 years under ideal conditions, plastic pipe may only last 20-25. In some parts of Albuquerque, copper pipe can deteriorate and fail in only 5 years if installed underground, due to the PH of the soil. You need to pick the product which is best suited for your home and your budget, install a pressure regulating valve and an expansion tank if needed, and understand that your home may very well outlast the current plumbing.
Written by Mark T Fiedler - The Mark and Sheila Team March 27th, 2013
Q: I have been looking for a home to buy, maybe in Northern Meadows as soon as I have the down payment saved. I am prequalified for an FHA mortgage, which means I’ll only need to save 3.5% of the purchase price. My concern is that I’ve read that the FHA may be insolvent soon because of their foreclosure losses over the last few years. What should I do? Celestina in Rio Rancho
A: In November 2012, the FHA held a press conference and did indeed disclose that their capital reserve ratio of the MMI Fund (Mutual Mortgage Insurance) used to support FHA’s single family home and reverse mortgage insurance programs were at a negative 1.44 percent. Without explaining the math, their reserves against losses are well below where they should be. In spite of this, the FHA is backed by the federal government (that means you and me, the taxpayers) and they will not be defaulting anytime soon. However, the FHA mortgage program is supposed to be self sustaining, so they do have to make changes. Earlier in 2012 the FHA raised the amount paid for up front mortgage insurance from 1.25% of the loan amount to 1.75%. This increase started to rebuild the reserve funds, but it wasn’t enough.
FHA mortgage holders not only pay the up front mortgage insurance, but they also pay a monthly mortgage insurance fee. In 2012 the rules read that after at least five years and if the mortgage balance has fallen below 78% of the home’s value (based upon the scheduled principal reduction), a borrower could stop paying the monthly mortgage insurance. On a $150,000 mortgage, would mean a reduction in the mortgage payment of $156.25 (at the 1.25% rate). On January 31, 2013 the FHA announced that they were making the monthly mortgage insurance permanent on all their new loans. Starting June 1st, 2013, new FHA loan holders will contribute this money every month for as long as the loan stays in place. The amount of the monthly mortgage premium payments will also go up by about 8% on new loans starting April 1st, 2013. (The above effective dates are not the date the transaction closes, but the date the lender gets a new case number for your loan in process.) These permanent payments will help rebuild the FHA reserves. If you are considering making a purchase utilizing FHA financing, you might want to get off the fence and find a home prior to this policy change going into effect. If you already have an FHA loan, the original terms will not be changing.
Written by Mark T Fiedler - The Mark and Sheila Team March 20th, 2013
4 Bedrooms, 3 Bathrooms, 3211 Square Feet
Built into a hill, it looks like a 1 story home from the front, but a lower level walkout gives access to the back yard. The 180 degree mountain view from the upstairs deck and main living area is breathtaking. The flooring everywhere but the kitchen and baths is 3/4 inch oak planking. There is surround sound wiring in 3 rooms, security cameras at every entrance, ethernet throughout and more. A huge basement storage space runs the width of the house plus there is an RV pad with 50amp service.
Written by Mark T Fiedler - The Mark and Sheila Team March 6th, 2013
3 Bedrooms, 2 Bathrooms, 3426 Square Feet
Its all about space – LOTS OF SPACE! This rambling ranch style home goes on and on. There are 3 living spaces – a formal living room, a family room and a rec room. The laundry room is not just spacious, its large enough to double as an office! The 2nd and 3rd bedrooms are roomy enough to use as a barracks. The roof was new in 2012. The oversized detached garage has a single width door front and back. The back yard goes on and on (.85 acres) with access for an RV or just about anything else!
Written by Mark T Fiedler - The Mark and Sheila Team February 15th, 2013
Q: My house has been for sale for a couple months. I’m worried that with the layoff of 200 Hewlett Packard employees the local real estate market will be flooded with competition for me. Am I right to be concerned? Nicki in Northern Meadows.
A: First let us say that our hearts go out to the HP employees that have been laid off or who soon will be. Unfortunately, whenever a large employer has to adjust its workforce, people’s lives change, and sometimes their home will too.
We’ve had some experience with this situation in the past with Intel layoffs of up to 1,000 people. Here’s what happened then: Many of the families where someone was laid off were two income households. Though it may have been tough, there was still income to the family while the laid off party looked for another job locally. In a high percentage of cases, the family stayed in their home. Where a decision was made to sell and move away, it sometimes took a long time to decide, further stretching out the process and lessening the impact on the market.
Some employees were renters on 12 month leases, with others on a month to month basis. They were free to move if necessary when their lease was up. Perhaps a few properties went back on the rental market as a result.
In the case of HP, the layoffs may take until the end of October 2013, so the effect on the real estate market will be spread out. Some employees may move with their jobs, but that number has not been disclosed.
The HP facility in Rio Rancho opened in late 2009. Since home prices in the Rio Rancho area have steadily declined since then, employees who purchased a home then and who did not make a substantial down payment are likely to be upside down (owe more on their mortgage than their home is worth). This could result in some homes being marketed as short sales, some homes being lost to foreclosure, and others being rented to cover the mortgage while the owner moves on.
There are just over 600 single family homes for sale currently in Rio Rancho. Because there are multiple paths people will be taking in dealing with the layoff, and their timetables will de different, our best guess is that the number of homes on the market will potentially increase at most 5% at any one time. This is not a big change and should not impact your sale.
Written by Mark T Fiedler - The Mark and Sheila Team February 15th, 2013
Q: My husband and I are considering selling our home in 2013. We are concerned about the 3.8% “home sales tax” which was buried in the ObamaCare bill. Our home is worth about $200,000 and we’ve lived in it for five years. A tax of $7600 would probably take almost half the profit from our sale. Is there a way to keep more of our profits? Marie in Rio Rancho
A: We have good news for you. You should get to keep all the profits from your home sales! There has been a lot of misinformation disseminated about this tax. Although we are not CPAís, the National Association of Realtors has produced several publications explaining it. We will use an example from their materials.
First, the tax is not on home sales, but on investment income – interest, dividends, rents (after expenses) and capital gains (less losses). There are also exclusions and income limits before the tax is applied. For instance: If your adjusted gross income as a couple is under $250,000 (or $200,000 for an individual) the tax would not apply. If you don’t make this much money, you can stop reading now. For the 3% of the population nationally that does earn this much, let’s go on. Say you sold your primary residence for $825,000. If you purchased it for $300,000 ten years ago your taxable capital gain after taking your $500,000 couple’s personal residence exclusion would be $25,000. ($825,000 – $300,000 = $525,000 – $500,000 exclusion = $25,000 capital gain.) The 3.8% tax would apply to this amount and you would pay $950. That’s not too bad after a $525,000 profit, right? These calculations get a little trickier when dealing with rental income from investment real estate, so we won’t go into that. This is why you have a CPA!
Bottom line, only a small percentage of people make enough income to even consider this tax law. Even those only need look at their investment income, not their earned income, or income from employment. Good luck on your home sale.
Written by Mark T Fiedler - The Mark and Sheila Team December 17th, 2012
5 Bedrooms, 2.5 Baths, 3108 Sq Feet, 3 Car Garage
Former Tiffany model home with all the bells and whistles! 2×6 Framing, Pella Windows and Doors, GE Monogram Stainless Steel Appliances, Beautiful Slate Tile, Vigas and Latillas, Custom Cabinetry, Granite Counters and Window Sills throughtout! The back yard is fully landscaped with an Extended Patio and Outdoor Fireplace. The garage is finished with an epoxied floor. The utility room is equiped for 2 pairs washers and dryers. This home is truly a showplace and a warm haven for your family.
Written by Mark T Fiedler - The Mark and Sheila Team September 19th, 2012
4 Bedrooms, 3 Bathrooms, 2671 Square Feet, 2 Car Garage and RV Space
Large and light, this home can accommodate a big household, plus an artist, craftsperson, woodworker or anyone that needs a large heated workshop or studio! Located adjacent to open space and within 200ft of the Rio Grande bosque, this home shines with fresh paint inside and out, new carpet, and tile in baths and the kitchen. There are 2 living areas, plus a large 18×14 den, office or home theater. The 3 car garage has one RV height door and is deep enough to handle an RV up to 24.5 ft long.
Written by Mark T Fiedler - The Mark and Sheila Team September 10th, 2012
3 Bedrooms plus a Den, 2 Bathrooms, 2187 Square Feet, 2 Car Garage
With 3 bedrooms, a den and large living spaces, this home has lots of space for your household. Features like hot water recirculation for instant hot water, double ovens for holiday cooking, 2 kitchen pantries and solid surface kitchen counters set this home apart. The double door refrigerator has water and ice at the door. There are recessed lights, upgraded fixtures, a kiva style gas log fireplace, a covered patio and a fully landscaped back yard. Visit this one before it is gone!
Written by Mark T Fiedler - The Mark and Sheila Team August 9th, 2012
4 Bedrooms, 3 Bathrooms, 2270 Square Feet 2 Car Garage
This custom home by Firebird is some of their best work! The Master Suite includes a Large Triangular Jacuzzi Tub Surrounded by Cultured Granite, and a Tiled Walk in Shower. The other bedrooms are in a separate wing, with a Guest Suite plus 2 additional bedrooms for a total of 4. The spacious kitchen has all Stainless Steel Appliances, Thick Granite Counters , an Island and a Huge Walk in Pantry. The entire half acre lot is landscaped, and has beautiful views of the Sandias. You will love it!
Written by Mark T Fiedler - The Mark and Sheila Team August 7th, 2012
4 Bedrooms, 2 Bathrooms, 2191 Square Feet
One of the nicest homes we have seen in this neighborhood! The spacious kitchen has a Kitchen Aid pro-style stove, Corian solid surface counters, and a huge island. Inside, the upgraded light and plumbing fixtures, fans and decorator paint will wow you. Plug into the surround sound speakers in the living room. Step outside to enjoy the pergolas in front and back, extra high block walls, a producing vegetable garden, a huge dog run and a clear view of the Sandias. Dont miss this one!
Written by Mark T Fiedler - The Mark and Sheila Team June 19th, 2012
3 Bedrooms, 3 Bathrooms, 2000 Square Ft
The owner of this home put $10s of Thousand$ into upgrades. Now it is YOUR turn to enjoy them! The kitchen remodel is to die for, with all stainless steel, top of the line LG appliances, solid surface counter tops and shiny decorative metal backsplash. Out back, the covered patio is just the beginning of the entertainment space, which includes a hot tub, gardens of flowers and pathways. There are vegetable gardens, a storage shed, back yard access and Mountain and City Light VIEWS!
Written by Mark T Fiedler - The Mark and Sheila Team June 7th, 2012
3 Bedrooms, 3 Bathrooms, 2249 Square Ft
You will love this spacious townhome in a gated community in Cabezon. Just steps to a park, close to walking trails and a community pool. There is a beautifully upgraded kitchen with granite counters, a pantry and stainless steel appliances. Upstairs there is a quiet loft, upgraded lighting, decorator paint and large bedrooms with walk-in closets. Outside, a concrete patio spans almost the width of the lot!This home has lots of space and loads of personality for you to enjoy! Come see it!
