Real Estate in Steamboat

Many homeowners have been known to lay awake at night, obsessing about the cabinet door styles, countertop materials and floor coverings for their new kitchen. Almost no one looses sleep over the drawer and cabinet door pulls, but this small detail can add a touch of magic, subtle nuance, playfulness or sass, as I discovered at the Kitchen and Bath Industry Show last April in Chicago.

The most unusual drawer and cabinet hardware was Gado Gado International’s. Handmade by Balinese and Javanese craftsmen whose skills have been passed down through generations of families for hundreds of years, these cast brass knobs and pulls will add exotic flare to any kitchen or bathroom. David Sussman–an American geologist who spent more than 20 years in Indonesia and came to know and love its rich artistic culture–founded the company six years go.

Though similar artistic style runs through all the Gado Gado pieces, the astonishing degree of variety makes the company name especially appropriate. “Gado gado” is a standard Indonesian dish that includes boiled eggs, tofu, spicy peanut sauce and whatever vegetables the cook feels like adding. In every restaurant and town, it is always recognizable, but just a bit different.

The unusual shapes of the Gado Gado pieces are typically Indonesian and very different for Americans. Though the firm does offer a few knobs, most pieces are round or elliptical-shaped pulls that hang from a brass plate that is attached to the drawer front or cabinet door. The brass plates are variously embellished with floral, spiral, delicate filigree, or geometric patterns that are inspired not only by Indonesia’s own highly developed artistic culture, but also by the European, Chinese and Islamic cultures that have passed through these islands over the last 15 centuries. Each piece has an antiqued patina that’s made from black Balinese volcanic ash, and it really does make them look old enough to have been brought back from Asia 80 years ago by your very eccentric, well-traveled, great, great-aunt.

Many of Gado Gado’s ring pulls and plates are larger than you would typically find in an American kitchen or bathroom and some homeowners might find them more suited to built-in cabinetry elsewhere in the house.

Gado Gado also offers one-piece hourglass-and-torpedo-shaped pulls that can be as short as 3 inches and a perfect fit for a kitchen cabinet door or as long as 30 inches and more suited to a front door or the doors of the huge restaurant-sized refrigerators and freezers that are increasingly common in upscale homes.

The crisp, strong details of each Gado Gado piece are characteristic of the traditional two-step handcrafted production method used by their Indonesian craftsmen. Each knob and pull begins as an intricately carved piece of mahogany. From this, a mold is made that is used to cast the finished piece in brass. The advantage of this two-step process is that the crisp and sharp lines of the initial carving are carried through to each finished piece; even better these lines are highly visible, even from across the room.

Gado Gado’s prices depend on the number of castings that can be made from each mold. The smaller pieces are less expensive because a single mold can produce as many as 500 castings. For the larger pieces, only one casting can be made from each mold. For example, a 2-inch ring with a filigreed, star-shaped plate is $18. The same thing in a larger, 7-inch size is $68.

On the other hand, you may be looking for a totally different, simpler and more natural look for your new kitchen. In that case, you might go for the marble pulls offered by Cal Crystals of Concord, Calif. The firm’s pulls are offered in five marble colors including white, black, green, red, and beige. Each marble color comes in lighter and darker shades, and each knob is flecked or streaked, a subtle giveaway that it is stone and not plastic.

The round knobs, which have either a rounded ball shape or a flat front (in the knob biz, this is called a “mushroom” shape), are 1 1/4 to 2 inches in diameter. The smallest ones are more suited to the smaller drawers in a bathroom vanity, but any of the larger ones would look well on kitchen drawers or cabinet doors. The knobs are made in Taiwan, which, unbeknownst to most Americans, has many large marble deposits. After the knobs are cut and polished, they are finished with a light lacquer, which prevents any food on sticky fingers or natural skin oils from being absorbed and discoloring the marble. The Cal Crystal knobs are $6 to $13 apiece.

Then again, you may be looking for kitchen and bathroom knobs that are bright and snappy. Nifty Nob could be your ticket. Designed by the firm’s owner, Susan Zimmermann, these brilliantly colored, cast ceramic knobs range in size and subject matter from 4-inch giraffes to 3-inch angelfish to smaller, slightly less exuberant, floral motifs and simple squared shapes.

Central to the design of each knob, Zimmermann said, is the ease of its use. For example, she explained, her child’s bathroom vanity pull is designed so that both a child with small hands and a parent with adult-sized ones can easily grasp it.

Another challenge for knob designers, Zimmermann said, is transferring an inspiration from another source to a knob. For example a duck might seem a natural for a child’s dresser, but this shape is awkward to grasp when it is on the front of a drawer.

Ergonomically speaking, Zimmermann said, the best way to know if a knob will work for you is to grasp it with your eyes shut. You’ll quickly discover if the shape is easy or awkward to grasp or if it has sharp points that might cut your fingers. Nifty Nob’s knobs are $8 to $10 apiece.

Perhaps for you, the most important thing about a knob or pull is its color. In that case you should consider Exxel Decorative Hardware. Its “Classic Color Knob & Pull Collection” has 12 knob or pull styles, each one available in 92 colors, including 30 reds that range from the faintest pink to fire engine red.

Both the knobs and pulls are made of cast polymer. Many of these colored knobs are especially bright and, in many cases, downright sassy. With the “Straight Deco Pulls,” you can also create some unusual effects because you can mix the bright or mellow color of the pull (the part that your grasp with your hand) with the metal end pieces that attach it to the drawer front or cabinet door. The metal choices include nickel (a matte gray that your friends will never identify), “satin,” (steel with a black matte finish that your friends won’t identify either) or polished brass (your friends will say its classy). Exxel’s knobs and pulls are $6.50 to $15 apiece.

As you deliberate which knob or pull for you, don’t make your choice on the basis of a photograph. All these manufacturers sent me samples so that I could study the subtleties that cannot be grasped in a quick conversation at a trade show or a photograph. Equally important, don’t lock yourself into only one choice for each room. I tried out all but the Gado Gado pieces on my own eight-knob bathroom vanity, and the possibilities of mixing are rich. Not only can you use different colors within one manufacturer’s collection, you can mix the work of different manufacturers. For example, on my white melamine eight-knob vanity, the knobs for the cabinet doors under the sink could be Exxel’s bright orange cylinder-styled ones, while the knobs on the drawer bases on each side could be different ceramic animal knobs from Nifty Nob.

Contact information:

Gado Gado International: www.gadogadointl.com; click on “hardware.”

Cal Crystal: This firm does not have its own Web site. Information is available on www.myknobs.com (click “Cal Crystal” in the search by manufacturer function).

Nifty Nob: www.niftynob.com.

Exxel: www.exxelco.com. To locate a kitchen and bath dealer near you that carries Exxel products, call 800-553-9935.

Questions, queries? Katherine Salant can be contacted at www.katherinesalant.com.

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Copyright 2006 Katherine Salant

Not too long ago, a neighbor asked if I knew where our sewer and storm drains are located. He apparently wants to adjust the drainage on his property to drain into the public storm sewer drain, which I knew adjoins our lots.

After that brief conversation, I checked the legal description for my property. All it says is the city has a public utility easement along the northerly 5 feet of my property. But the easement description doesn’t say what underground utilities are there and exactly where they are located.

Purchase Bob Bruss reports online.

Further research in the public records might reveal exactly what underground public utility easements pass through my property and exactly where they are located.

WHAT IS AN EASEMENT? Virtually every property in an urban area is subject to one or more easements. An easement is the legal right of a public or private entity to use part of a real property owner’s land.

The property that is burdened by an easement is called a “servient tenement” because the easement serves another parcel. The property that benefits from the easement is called the adjoining dominant tenement.”

There is always a servient tenement. However, there is not always an adjoining dominant tenement, such as for a public utility easement.

Private easement examples include a driveway, path or garden area of a neighbor’s property. Public easements include utility easements for water, sewer, storm drain, electric lines, phone lines, gas pipes and cable TV lines.

Most easements are obtained with permission of the original property owner, usually at the time a subdivision is developed. The utility easements are often granted free by the developer in return for the city or private utility bringing public services to the property.

But some easements are hostile, without the specific permission of the property owner. To illustrate, suppose I drive over part of your property to reach my garage because that route is shorter and easier than using my steep driveway to reach the public street. Even if you tell me to stop driving over your land, but I continue to do so for the number of years required by state law, eventually I can obtain a permanent prescriptive easement for that purpose.

To be valid, an easement must be recorded against the title of the property that is subject to the easement, such as a shared driveway between two houses.

A very rare easement is an easement by necessity. Most states have laws allowing creation of an easement by necessity to reach a landlocked parcel, which has no driveway or other access to a public road.

The legal theory is all land should have road access, and when the landlocked parcel was created the owner at that time forgot to include access. A quiet title lawsuit is usually required to create an easement by necessity over an adjoining parcel that has public road access and, at some time in the past, had common ownership with the landlocked parcel.

THREE BASIC TYPES OF EASEMENTS. Virtually every real estate parcel is burdened by some type of easement. To be valid, the easement must either be recorded in the public records affecting a specific parcel, or it must be capable of being perfected into a valid easement.

1. EASEMENTS APPURTENANT BENEFIT AN ADJOINING PARCEL. Where there is a dominant tenement that benefits from an easement, such as for a driveway, that is an easement appurtenant. Most easements appurtenant were created when a subdivision was developed, or when two adjoining lots were subdivided.

An easement appurtenant is usually recorded against both parcels, describing the details of that easement. To be valid, an easement appurtenant must be recorded against the servient tenement title. It is usually also recorded against the dominant tenement title.

When a parcel is landlocked without public road access, it is up to the owner of that parcel to prove entitlement to an easement by necessity. If the court approves such an easement, it becomes an easement appurtenant with dominant and servient tenements.

2. EASEMENTS IN GROSS AFFECT MOST PROPERTIES. Virtually every property with electricity, phone, TV cable, public water, sewer, and storm drain utility service is subject to one or more easements in gross. Most such easements are recorded in the public records against each property title affected.

An easement in gross has a servient tenement, but no dominant tenement. Sometimes such easements were not properly recorded. If the easement in gross is obvious, such as for overhead power lines, it is hard for the property owner to deny awareness.

But underground easements in gross, such as for water, sewer and gas pipes, might not be obvious. To avoid unexpected surprises, property buyers should insist on receiving an owner’s title insurance policy at the time of purchase. If an underground easement in gross is later discovered, but it was not disclosed in the owner’s title insurance policy, the title insurer may be liable to the property owner for damages.

For example, suppose you decide to build a swimming pool in your backyard. As the contractor is digging, he discovers a previously undisclosed city sewer through the middle of your backyard. If the city’s sewer easement was properly recorded, but the title insurer failed to discover and disclose it, the title insurer is liable to the property owner for either the cost of moving the sewer pipe or the diminished value of the property.

3. PRESCRIPTIVE EASEMENTS REQUIRE HOSTILITY. When someone uses part of your property without your permission, and without a prior recorded easement, he or she might become entitled to permanent use of that easement.

The legal requirements to acquire a prescriptive easement over someone’s land requires (a) open, (b) notorious (obvious), (c) hostile (without permission), and (d) continuous use of part of another’s property without permission for the number of years required by state law.

Payment of property taxes is not required, as it is to obtain title by adverse possession.

California has the shortest prescriptive easement period, only five years. But Texas requires 30 years to acquire a prescriptive easement. Other states have varying time tests.

Because prescriptive easements can be shared, the hostile use need not be exclusive. Use can be shared with the legal owner and/or other hostile prescriptive easement claimants.After meeting the time and use requirements, a prescriptive easement acquirer can perfect the easement by bringing a quiet title lawsuit against the property’s legal owner. An experienced real estate attorney is usually needed to prove the prescriptive easement requirements.

SUMMARY: Virtually every property is burdened by or benefits from an easement. Property owners should understand the legal consequences of those easements and where they are located. Unless properly recorded, an easement might not be valid except when it is obvious by long continuous use, such as overhead power lines. For full easement details, please consult a local real estate attorney.

(For more information on Bob Bruss publications, visit his Real Estate Center).

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What’s your opinion? Send your Letter to the Editor to opinion@inman.com.

Copyright 2006 Inman News

Let’s face facts. Guys love tools. They just do, and the cooler the better. So here are some brand-new offerings from some of the biggest names in tools:

Skil Cordless Drill–Car Combo (Model 2566-06; $69.99): OK, a cordless drill is not exactly new. But how about one that comes in a kit with a remote control car, so Dad can have some fun for a change? Skil’s latest offering has several handy new features, including a removable onboard bit storage and drill-size index, a bit and screw storage bin on the handle, lighted forward and reverse indicator, a battery charge indicator light, and a keyless chuck. The drill uses their standard 14.4-volt battery and charger (both included, along with a soft carrying case). Also in the kit, just for fun, is a remote-controlled battery-powered car that uses the same battery as the drill. The remote controller even comes with a 9-volt battery in it, so you can run the car right out of the box!

Skil Belt Sander (Model 7500; $49.95): Another new introduction for Skil is this lightweight belt sander that’s perfect for any number of household projects. It has a power 6-amp motor (one-third more powerful then Skil’s last sander), and a standard 3×18 belt with “Auto Track” to make alignment easy. It sands flush against vertical surfaces to eliminate the need for a finish sander in corners, and has a hard-shell dust canister with a built-in filter. There’s also an adaptor that replaces the canister so you can connect directly to the hose on your shop vacuum.

DeWalt 18-Volt Fluorescent Area Light (Model DC527; $44.95): DeWalt is known for professional-grade tools, and their new Fluorescent Area Light is no exception. It uses a 13-watt fluorescent bulb for brighter light with less shadowing then you get from other types of work lights, and the tough, durable lens cover stands up to on-the-job abuse and pops off for easy bulb changing without tools. With the battery installed, the light will stand up on its own, or you can hang it from the built-in, retractable, rotating hook. The light uses the same 18-volt battery as their other tools (battery not included), so you can swap batteries between any 18-volt tools in their line — there’s also a 14.4/12-volt model available if Dad already has tools with those batteries. Definitely a tool suited for handyman and professional contractor alike.

Black and Decker Alligator Lopper (Model LP1000; $99.99): To protect roofs and siding from damage and to clean up after winter storms, pruning trees is a necessity. Black and Decker has just introduced a truly unique tool that really gets the job done fast. Their electric Alligator Lopper utilizes scissor-action jaws like conventional loppers, combined with a chain saw bar and chain. Just clamp down on any limb up to 4 inches around, pull the trigger, and the chain makes short work of the cutting chores. It’s safer than a chainsaw and requires a lot less effort than conventional lopping shears, and at just 6.5 pounds it’s light enough to work with for an extended period.

Black and Decker Cordless Sweeper (Model NS118; $69.99): Deck refinishing, exterior painting projects, sealing patios–they all require clean surfaces. Black and Decker has made that task easier and more convenient with a cordless rechargeable blower that blows surfaces clean much faster and more effectively than you can do with a push broom. The 18-volt battery fits all tools in the Black and Decker line, and the blower with battery weighs in at just 5.5 pounds. No cord, no gas, lots of power — it’s a tool Dad’s going to reach for a lot! And for even more convenience, you might want to consider the B & D’s complete Lawn Care Center ($249.99), which includes the blower, a 12-inch cordless string trimmer, and a 22-inch cordless hedge trimmer, all with a storage/charging center. All of the tools utilize the same 18-volt batteries and charger, which are included with both the individual tools and the kit.

Dremel MiniMite (Model 750-02; $29.95): Guys love more power, but great tools can come in small packages as well. Dremel’s MiniMite cordless rotary tool has a replaceable, rechargeable 4.8-volt battery that powers the two-speed tool at up to 13,000 rpm. It features a keyless chuck and collet that fits all of the extensive line of Dremel accessories — a starter pack of five accessories is included — and also includes a battery and charger. This light, powerful and versatile tool will find hundreds of uses in Dad’s shop, toolbox, or hobby table.

Remodeling and repair questions? E-mail Paul at paul2887@direcway.com.

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What’s your opinion? Send your Letter to the Editor to opinion@inman.com.

Copyright 2006 Inman News

The latest mortgage run toward 7 percent has stalled (“retreat” is too strong) because of yesterday’s shift in one Federal Reserve phrase: on May 10 economic growth was “likely to moderate”; but as of yesterday, “growth is moderating.”

If so, then the inflation threat will also moderate, though with a lag of several uneasy months. The bond market will lurch in response to each new report: next Friday’s June payroll numbers could as easily contradict the Fed as confirm a slowdown, or surprise everyone by showing deep weakness that no one expects.

The core personal income deflator this morning was up 2.1 percent year-over year, out of bounds but not accelerating. Not one bit reassuring that the Fed has it right: since the meeting oil has run to $74, and gold blew up $25 to $614. Stocks soared (silly: the Fed just told you the economy is slowing) and the dollar fell (mechanical: topping U.S. rates versus foreign ones still likely to rise).

Federal Reserve Chair Ben Bernanke, widely regarded among bond traders as a pantywaist, is not. He is plenty tough (if short of the leadership standard of Volcker and Greenspan), and he has one serious reason to worry about overshooting: housing.

To date, economic damage from a slowing housing market is limited to mortgage lenders: the industry is running at about half of capacity (closures and layoffs bringing that down), loan applications still falling. However, we are the serial bleeders of interest-rate cycles, and there are too few of us to matter to the economy.

Housing itself is a slow roller, and there is not yet evidence of economic drag (stimulus from hot housing has cooled, but that’s a different deal). Inventories of unsold homes are piling up, but current estimates of 6.5 months’ supply are not bad. Trouble lies close to a year’s supply, and inventories tend to stop growing before that as sellers give up on cashing in before markets slow.

Bubbleologists have created the impression that the entire housing market consists of rental-property, second-home, flip, fix-and-flip, and buyer-panic-above-list speculation. The reality is the reverse: people buy homes to live in them. An overdue housing slowdown is not going to cause pain until involuntary sales cause prices to fall, and in more than a handful of markets. Involuntary sales are caused first by economic distress and job loss. We have none of that outside the auto belt.

The bubbleologists are screeching about adjustable-rate mortgage (ARM) loans adjusting upward, but that isn’t doing any real harm either. Home equity lines have gone from 4 percent to 8 percent-plus, but the balances tend to be small and are diffuse across the economy. The only ARMs in current adjustment are monthly floaters tied to COFI and MTA, both lagging indices one year to six months behind the Fed, yet to hit consumer wallets.

The most exposed are the hybrid adjustables, predominately 5-year stuff closed from ’02 to ’04 at rates near 4 percent. Only the very first of those bombs are going off now, and they are easily refinanced. Conversations at my desk make plain more annoyance than discomfort and disinterest in giving up a 3 percent-per-year advantage by refinancing now — the nearly unanimous choice is to wait to refi.

If there’s no problem in any of the above, what’s Bernanke got to worry about? Home prices. The weakness during the wild run has been low- or no-down-payment lending. Huge appreciation has built equity quickly in hot markets, but any widespread decline in price — even a few percentage points — and foreclosure trouble can become self-feeding. If you have little or no equity, and have to sell your home, you wind up in foreclosure because you can’t pay the costs of sale.

Magnifying the price risk is the suicidal need of large production builders to keep building, selling at incentive-laden break-even or loss — just like pathetic GM and Ford. This week we saw an increase in new-home sales and a decline in existing ones; I would feel better about overall price prospects if the new-builds fell off a cliff.

Lou Barnes is a mortgage broker and nationally syndicated columnist based in Boulder, Colo. He can be reached at lbarnes@boulderwest.com.

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What’s your opinion? Send your Letter to the Editor to opinion@inman.com.

Copyright 2006 Lou Barnes

There are three types of real estate investment opportunities that should be avoided if profits are your main goal. Here they are:

1. AVOID BUYING HOUSES IN EXCELLENT CONDITION. Fortunately, the long-term trend for sound, well-located U.S. houses has always been up. But along the way, there are peaks, valleys and plateaus. “Are we in a real estate bubble?” is a question I am frequently asked. My reply is “I don’t think so, but if you find someone who knows for sure, please let me know.”

Purchase Bob Bruss reports online.

To avoid this market-value risk of buying at the top of a housing bubble, I recommend avoiding purchasing houses in excellent condition and, instead, buying so-called “fixer-upper houses” where the market value can be increased by making profitable improvements that add more market value than they cost. This technique is called “forced inflation.” It is used by smart home buyers and real estate investors to raise the market value of a property by more than the fix-up work costs.

EXAMPLE: Every community has sound, well-located but run-down houses. We see them every day. They can usually be purchased substantially below the market value of similar nearby houses that don’t need fix-up work. Having fixed-up many houses like this, and profitably resold them, I’ve found the most profitable improvements are paint (fresh paint often adds two or three times its cost to a home’s market value), new light fixtures, new wall-to-wall carpets (or refinished hardwood floors), fresh landscaping, and general clean-up and repairs. This type of fix-up work is known as “cosmetic improvement.”

Please notice I did not suggest kitchen renovation, bathroom remodeling or room additions. However, I’ve learned adding a second bathroom to a one-bathroom home will usually add at least twice the bathroom’s cost to that home’s market value, especially if you can accomplish the result without adding on to the square footage of the house (such as by converting a walk-in closet or hall space to a second bathroom). As for kitchens, either adding new cabinet fronts or installing new cabinets at reasonable cost won’t add much market value, but it will increase the desirability of a home and its appeal to future buyers.

If you want to profit from your home purchase, I suggest avoiding purchase of a house in tip-top condition. That’s the way to sell a home, but not the way to profitably buy!

2. AVOID BUYING “TEAR-DOWNS” OR “SCRAPERS.” Some homes are in such bad condition they need major structural work, such as a new foundation, new wiring and new plumbing, or they are hopelessly outdated with a bad floorplan design or other incurable defect. In the real estate business, these are known as “tear downs” or “scrapers.” Avoid such a purchase unless you can buy the property for its land value alone.

EXAMPLE: Many of the old New Orleans houses which were flooded in Hurricane Katrina are in this category. After the levees are rebuilt, strengthened and made 100 percent secure, these old run-down houses will probably be torn down and replaced by quality modular or manufactured houses built in factories and trucked to the sites.

EXAMPLE: Several months ago I inspected a $2.5 million house overlooking San Francisco Bay. The view was fantastic! However, the old house on the lot was a wreck. I knew the owner who lived there over 50 years, raised his two sons there, and died there at age 92. Nearby houses in superb condition sell for around $2.5 million. Whoever buys that property will probably either (1) fix up the old house minimally and live in it, or rent it, with the hope the property might appreciate in market value, or (2) tear down the house and build a “McMansion,” which will be an over-improvement for the neighborhood. After consulting several real estate investors about that property (whose heirs refuse to reduce the asking price), we concluded it is not a profitable opportunity.

3. AVOID TOWNHOUSES AND CONDOMINIUMS. Most townhouses and condominiums offer little profit opportunity (except possibly as long-term investments). Why? The reason is these units, which are very similar to the adjoining townhouses and condominiums, are constrained by the sales prices of those nearby properties.

Even if you can buy a run-down townhouse or condominium at a bargain price and fix it up, your profit potential is limited (no matter how nice your unit is after fix-up) by the sales prices of those comparable nearby units. Unless lots of units in the complex are being upgraded and profitably resold, and if there is a very strong buyer demand, I suggest avoiding townhouses and condominiums because of the upside market-value limits imposed by sales prices of other units in the complex.

(For more information on Bob Bruss publications, visit his Real Estate Center).

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What’s your opinion? Send your Letter to the Editor to opinion@inman.com.

Copyright 2006 Robert Bruss

DEAR BOB: I own a two-acre lot in an area of mostly one-acre lots. A neighbor wants to buy a half acre from me so he can build what I call a “McMansion.” He needs a larger lot to accommodate the size home he and his wife want to build. We don’t mind because it won’t be close to our house and having a highly valued house next to ours should enhance our home’s market value. However, we don’t know how to value a half-acre lot where there are no lots for sale. Also, what legal steps must be followed to deed a half acre? –Walter H.

DEAR WALTER: I suggest you retain an appraiser and a real estate attorney. If you proceed with the half-acre lot sale, be sure to add your appraisal and legal costs to the sale price of the property.

Purchase Bob Bruss reports online.

As you will discover, subdividing a lot in an urban area usually is not simple. Although you have no objection, the neighbors might protest.

The appraiser can inform you of the market value of a half-acre lot in your neighborhood. But the real estate attorney will be needed to handle the legal details of obtaining subdivision approval from the appropriate local authorities. As you and your neighbor will soon discover, selling half a lot is not easy.

WHAT IS A “STARKER EXCHANGE?”

DEAR BOB: I am a relatively new real estate agent. But I have heard the term “Starker exchange” and am not familiar with it. What does that mean? –Beth W.

DEAR BETH: Internal Revenue Code 1031 authorizes owners of investment and business property, such as apartments, rental houses, warehouses, office buildings and commercial properties, to trade their property for “like kind” properties of equal or greater cost and equity so they can defer the capital gain tax that would be due upon an ordinary sale.

A so-called Starker exchange is authorized under IRC 1031(a)(3), which permits the sale of qualifying property, with the sales proceeds held by a third-party accommodator or intermediary beyond the seller’s “constructive receipt.”

The seller then has up to 45 days after the sale closes to designate a qualifying replacement property of equal or greater cost and equity, plus 180 days to complete the acquisition. For full details, please consult your personal tax adviser.

ARE HUD COUNSELORS TRULY INDEPENDENT?

DEAR BOB: Unknown to me, my 81-year-old mother recently took out a lifetime reverse mortgage. As her daughter, I was totally unaware she was doing this. The reverse mortgage lender sent a so-called “HUD counselor” to her house to spend an hour explaining reverse mortgages. About three months after this occurred, I learned my mother paid almost $6,000 in various up-front loan fees. Considering she is in declining health and will soon have to move to an assisted-living home, I find this outrageous conduct by the reverse mortgage company. Are the HUD counselors sent by a reverse mortgage company truly independent? –Sarah S.

DEAR SARAH: The three nationwide senior-citizen reverse mortgage lenders all require counseling by certified HUD counselors who are supposed to explain to the prospective borrowers the pros and cons of such mortgages.

Of course, nobody can vouch for such counselors being truly independent of the actual reverse mortgage lender. If a counselor discourages prospective borrowers from obtaining reverse mortgages, I’m sure that person won’t be recommended by a reverse mortgage lender again.

If your elderly mother plans to stay in her home at least five years, that $6,000 for various fees is not excessive. Please remember reverse mortgages pay money to the senior-citizen homeowner, without any repayment required until the homeowner either sells the home, vacates for more than 12 months, or dies. More details are in my special report, “The Whole Truth About Reverse Mortgages for Senior Citizen Homeowners,” available for $5 from Robert Bruss, 251 Park Road, Burlingame, CA 94010 or by credit card at 1-800-736-1736 or instant Internet delivery at www.BobBruss.com. Questions for this column are welcome at either address.

(For more information on Bob Bruss publications, visit his Real Estate Center).

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What’s your opinion? Send your Letter to the Editor to opinion@inman.com.

Copyright 2006 Inman News

DEAR BOB: Recently you had an item about how husband and wife should hold title to their home and other real estate. It motivated me to go to our safe deposit box to check our home title deed. It says we own our home in the name of “Mark or Victoria Lastname.” No method of holding title, such as joint tenancy or tenancy in common, is specified. Do we have a problem? –Victoria W.

DEAR VICTORIA: Yes. As a real estate attorney, I can see many potential problems with the way you hold title to your home. The very troublesome word is “or.”

Purchase Bob Bruss reports online.

Also, the deed fails to specify how you hold title, such as tenants in common, joint tenancy with right of survivorship, or another method. Whoever prepared that deed obviously wasn’t looking out for your best interests.

While you are in “good standing” with each other and the marriage is going well, today is the ideal time to consult a local real estate or family law attorney to discuss your title choices. Then, you can execute a joint quitclaim deed to hold title with the method you select.

NO NEED TO DISCLOSE DEFECTS IN NEARBY HOMES

DEAR BOB: For the last 22 years we have owned and enjoyed our home in a subdivision where all the homes were built by the same builder with the same materials. In the last few years, several homes have encountered basement wall leaks. However, our home has no such problem. We enjoy our basement family room, laundry room and storage area with no evidence of any water leaks. When we sell in the next few months so we can move to a retirement community, do we have to disclose to our buyer that a few other homes in our subdivision have encountered basement water leaks? –Steve Y.

DEAR STEVE: No. Home-sale disclosure laws only apply to the residence being sold at the time of the sale. They do not require disclosure that nearby homes down the street built by the same builder have encountered construction defect problems. For full details, please consult a local real estate attorney.

IS LOT SELLER LIABLE FOR UNDERGROUND STORM-SEWER EASEMENT?

DEAR BOB: Three years ago, we sold the vacant lot adjacent to our home. The buyer told us he planned to build a house there. That was fine with us. But when he recently applied for a city building permit, he discovered there is a city storm sewer pipe easement beneath the property, which will bar him from building anything but a very small house. We had no idea there was such a pipe easement. However, his title insurance report clearly revealed that easement. Do we have any liability to him as he threatens to sue us for damages? –Helene P.

DEAR HELENE: From your description of the situation, it appears you have no liability since you didn’t know about the underground city storm sewer pipe easement and it was fully disclosed to the buyer in his owner’s title insurance policy. I find it amazing how many property owners (and their real estate agents) fail to read and understand their title insurance reports.

The lot buyer has nobody to blame but himself for failure to read his owner’s title insurance policy, which described that storm sewer pipe easement. If the buyer sues you, of course you should hire an attorney to answer the complaint.

Your attorney should politely remind the buyer’s attorney you didn’t know about the easement and the buyer had written evidence of it in his title insurance policy, which he failed to read. After you win such a “no brainer” lawsuit, you can then sue the buyer for damages, primarily your attorney fees, for malicious prosecution.

The new Robert Bruss special report, “Probate Property Profit Secrets Revealed,” is now available for $5 from Robert Bruss, 251 Park Road, Burlingame, CA 94010 or by credit card at 1-800-736-1736 or instant Internet delivery at www.BobBruss.com. Questions for this column are welcome at either address.

(For more information on Bob Bruss publications, visit his Real Estate Center).

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What’s your opinion? Send your Letter to the Editor to opinion@inman.com.

Copyright 2006 Inman News

David and Suzanne McKenna own their home on Maybell Way in Palo Alto, Calif. Their residence suffered serious damage as the result of two backups of the city sewer serving their home.

After the first backup, their homeowner’s insurance company paid to install a new lateral sewer pipe from the house to the sewer located in the street.

Purchase Bob Bruss reports online.

But about a month later, the sewer again backed up into the McKenna home. This time the insurance company hired Spectrum Leak Locators to investigate the cause of the second backup. Their video inspection found the replaced lateral pipe was clear of debris and in perfect condition.

Spectrum discovered tree roots at the city’s “wye” joint connecting with the McKenna’s new lateral pipe to the city’s main sewer. The video inspection revealed toilet paper and effluent on the tree roots in the sewer main pipe, which was half-filled with standing water.

After paying the McKenna’s second homeowner’s insurance claim, the insurance company filed a lawsuit as subrogee against the city for damages from the second backup. The insurer argued the City of Palo Alto was liable for “inverse condemnation” damages, meaning the city’s action took the use of private property without payment.

But the city submitted evidence it has a maintenance program, including hydroflush of each main sewer line every two years. The Maybell Way sewer had been hydroflushed 18 months before these sewer backups. The city also noted no other homes on Maybell Way suffered sewer backup damages.

If you were the judge would you require the city to pay inverse condemnation damages for the second sewer backup?

The judge said yes!

There is no dispute as to the three elements of inverse condemnation damages: the McKenna property was taken or damaged, the damage was caused by the sewer backup, and the city’s sanitary sewer system is a public project, the judge explained. The only missing element was proximate causation, he emphasized.

At the trial, evidence was presented as to three possible causes, he continued. They were (a) tree roots in the main sewer line, (b) the sewer main had an inadequate slope to carry sewage away from the homes, and/or (c) there was standing water in the sewer line.

No matter what caused the sewer backup damage to the McKenna home, the public sewer failed to function as it was intended, the judge ruled. “The blockage occurred on city land and in piping strictly under the control of the city…in this case there was a substantial cause-and-effect relationship between factors entirely within the control of the city,” he noted. Therefore, there is no need to distinguish among them to determine the “how and why” the blockage occurred; the city is therefore liable for inverse condemnation damages, he concluded.

Based on the 2006 California Court of Appeal decision in California State Automobile Association Inter-Insurance Bureau v. City of Palo Alto, 41 Cal.Rptr.3d 503.

(For more information on Bob Bruss publications, visit his Real Estate Center).

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What’s your opinion? Send your Letter to the Editor to opinion@inman.com.

Copyright 2006 Inman News

Q: My dryer vent blows lint out onto my back stairs, which means I am always having to sweep them. Is there any way I can prevent this?

A: We can think of at least three ways to solve this problem. The one you choose depends on the location of the vent, the amount of work you want to do and the look when it’s completed.

We assume that the vent cap is at or above the level of your stairway.

You can either move the vent or leave it in place and redirect the flow of air away from the stairs. Both jobs are relatively easy to do and inexpensive. Relocating the vent presents the additional problem of patching the old vent hole.

Most dryer vent caps are made of aluminum and shaped like a hood that directs the warm air down — in your case toward the stairs. A simple fix might be to loosen the vent cap and redirect the opening of the hood to the side — diverting the air flow away from the stair treads.

This type of vent cap is usually attached to the wall by four screws, one in each corner. Simply remove the screws and twist the vent cap into the proper position. Sometimes, caulk has been applied to the edges of the cap where it meets the wall to ensure an airtight seal. If this is the case, score the caulk with a utility knife until the cap is loose, and reposition it.

Some vent caps are made in the form of louvers. When exhaust air blows through the vent pipe, the louvers open, and the air is directed outside. Turning the louvers will do no good. If you have this type of vent, replace it with a hooded model and direct the hood opening away from the steps.

An alternative solution is to remove the vent cap altogether and install a 90-degree elbow to the end of the exhaust pipe. Direct the end of the fitting away from the stairway and toward the ground. Remove the vent cap. You’ll probably have to extend the length of vent pipe a short distance to be able to attach the elbow.

Use duct tape or — what we prefer — adhesive-backed aluminum tape, to join the pieces.

To the outside of the “90″ attach a straight section of rigid vent pipe and direct it to the ground.

If your vent pipe is flexible plastic, we suggest you replace it with rigid aluminum. Plastic vent pipe is formed by embedding wire into plastic. It looks like the Slinky toys of our youth. When the pipe is extended, undulations form on the inside of the pipe and collect lint. The lint buildup reduces the efficiency of the air flow moving through the pipe and is a potential fire hazard.

The most complicated but perhaps most aesthetically pleasing solution is to relocate the vent. Depending on the placement of the new vent cap, you may be forced to reroute the existing pipe. If that’s the case, keep sharp bends to a minimum to facilitate air flow.

Once the new pipe is in place, you’ll need to patch the old hole. If the existing siding is stucco, you’re in luck. Just take care to blend in the old patch with the new.

But if you have wood or composite siding, it will be difficult to make the patch disappear. All things considered, we think if we were faced with this situation, we’d install the 90-degree bend and extend the vent away from the stair treads.

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What’s your opinion? Send your Letter to the Editor to opinion@inman.com.

Copyright 2006 Bill and Kevin Burnett