John Angell Real Estate Group – John Angell

Buying a Backup Generator

Why John,” you may ask, “is this newsletter late because you decided to center the front page article around Tuesday’s storm?”. Why yes, dear reader. I was prepared to write something relevant to the market or coming summer, but this was a chance to research something fresh in everyone’s minds.

It’s rare that we need a generator, but it would appear that “extreme weather” in Texas is increasing in frequency. The topic of generators is pretty big in options, so rather than giving you an insufficient view of all of things I’ll give you two options.

1) The Essentials – According to Consumer Reports, a 2,000 watt generator is enough to power your fridge, TV(s), 5-10 lights, a computer, charger and security system. There are portable, gas-powered generators. If you’re prepared to chance the elements and make a few concessions, you can live in relative comfort (sans HVAC) for $300-400. You’ll need to get gas every couple of days, but those steaks in the freezer will stay frozen, you’ll have light and TV, and the all-important internet will function.

2) All the Bells & Whistles – It’s Texas. The odds every outage won’t be followed by 70 degrees, and if you’re going to drop some coin on a generator you may as well have something even The Omega Man would envy. If you have natural gas, a 4-ton air conditioner (servicing 2,000 sqft) requires 17,000 watts. Stack on top of that the comforts you are willing to pay to maintain (TVs, internet, most-all of your lights, chargers, computers, stove/oven, everything except probably your dryer) and you’re up to roughly 22,000 watts. A permanent, wired into your electric panel and plumbed into your gas line is going to set you back $5,000-8000 PLUS installation. At this time I’m not sure the cost of the plumbers and electricians fees, but if I was to guess I’d add another $1,500 to that. Now this system is big, roughly the size of a table, but it will also increase the value of your house (not dollar-for-dollar) or you can take it with you when you move.

Architectural Corner: Italianate

Often considered more popular at it’s peak than Greek Revival Style, from the 1840s-1880s the splendor of Italian architecture was brought to the US in the form of Italianate. Inspired by farmhouses and villas of the 16th century, Italianate was popular across the western world.

Characterized by asymmetrical layouts, low-pitched or flat roofs, tall narrow windows, stately cupolas, masonry blocks at corner walls (quoins), exterior gallery corridors (loggias), triangular gables (pediments) and several other terms I had to look up, Italianate carried both romance and dignity. Some even featured towers.

Lasting until shortly after the Civil War, many residential and commercial buildings alike can still be seen in the US, mostly in the coastal states like New York and California.

MLS Statistics: April 2023

Architectural Corner: The Chateau

The word Chateau is old French from the Latin castellum, or castle. In France, they’re the equivalent of the large plantation or ranch houses in America, and are symbol of wealth and opulence.

After spending much of the 1850’s in France, architect Richard Morris Hunt is widely credited with introducing upper class Americans to this lavish, elaborate style. Chateau-style is one of the most elaborate styles of home, with towers and spires, steeply-itched roofs, ornamented windows and doors, tall, elaborate chimneys and dormers, and are typically of stone or masonry construction.

Chateau-style is also one of the styles that is frequently employed with describing new construction properties in North Texas, although the architectural adherence of some can be questioned. But it does sound fancy, making it easier to justify ridiculous prices.

Vague Specifics – October 2021

The market has definitely calmed down a bit since mid summer. It was surprising how early in the year it began in 2021, in fact it was going full-speed the week Texas shut down for the snow. I actually got into a wreck on I-30 on my way to an inspection (not one of my smarter moves), I think I had 4 contracts in title at the time which is almost unheard of for winter. After 4 months of breakneck market speed, in July we finally saw things start to slow. No, we’re not going to see the market “adjust”, and if we did we’ll have a lot more to worry about than the DFW real estate market because something really bad would be happening. To put this in context, we just went through an economy-shutting-down pandemic, and it did nothing but speed things up.

If you’ve been waiting to buy, it would be a good time to start looking. Multiple offer situations have settled down a bit (although they still exist, especially in some markets), inventory is rising slightly, and, most importantly, interest rates are about to go up. Thanks to the highest run of inflation we’ve seen in 20 years, the Federal Reserve is raising interest rates, and home affordability will inevitably suffer. Next spring will bring a bit more inventory, but it will also bring more buyers and higher rates.

Thank God the fall is here. We were really lucky this year when it comes to extreme heat, I think we had 5 days over 100 degrees, but the humidity has been just awful the last few years. It is nice to take that first step outside in the morning and not feel like I’m not in a pressure cooker.

Architectural Corner – Geodesic Dome

After seeing the Geodesic Dome Institute halfway between Dallas and Waco a million times, how could I not do an article?

The Geodesic Dome was developed in 1954 (patented in ‘65) by Buckminster Fuller, and were billed as the strongest, most economical, lightweight structure that could be built. Constructed from a complex network of triangles which create a self-bracing framework, this unusual design is used from storage sheds to multi-million dollar homes and buildings.

They may not be pretty by the standards of most. Frankly, they can look pretty silly depending on the structure, but no one can knock their durability and relatively low-cost of construction. They are often sold as prefab structures, but can be made to-order. They boast impressive survival rates against severe weather, and are exceptionally energy efficient… unless they’re made of glass in which case they’re called greenhouses.

Real Estate Investors: The Good, Bad & Ugly

I’ve always tried to follow the mantra of never saying, writing, or posting something while angry, but sometimes I have to strike while the emotional iron is hot. I’ll try to be as neutral as possible.

Real estate investors are everywhere. From high rollers with huge staffs, multiple buyers agents and 9-figure portfolios to some clown who attended a Rich Dad, Poor Dad seminar and is barely able to fill his car with gas, they are everywhere. And when a house comes on the market, they come a-knocking. The best opinion I can give:

The Good – Investors typically bring cash, and some have access to lots of it. Their plan is all about dollars-and-cents, and rarely do they become emotional. They may overlook issues that would drive off normal buyers, can quick-close, and, as long as the margins work, can often be the highest bidder. When a buyer offer works, it’s usually among the smoothest contracts ever.

The Bad – A lack of emotion can also be a weakness. Investors rarely “fall in love” with houses; it’s all numbers. Their agents are often high-volume bidders who submit a dozen offers a day, and communication can be limited.

The Ugly – Anyone can call themself an investor, it doesn’t mean they know what they’re doing, actually have access to capital, or have any regard for others. I’ve had investors who promise they’re going to rehab a property only to scrape it and investors who lock a property under contract only to use the option period to try to find another investor to bundle and sell it to, and when it doesn’t work out they walk. The larger ones submit 10-50 offers a day and may not have even toured the property.

Investors are a blessing and a curse, take their offers with a grain of salt.

What to Expect from the Fall Market

The real estate pendulum is always swinging. In 2011 it was a buyers market,10 years later it is the opposite. Granted, the DFW equivalent of a buyers market was nothing compared to such markets as Las Vegas, Reno, Phoenix and a few others, but it was a trying time that saw sellers make great concessions to bring a buyer to the closing table. Today, it is an absolute beating for buyers. Thanks to a diminished inventory, millions of people fleeing high-tax, high-regulation states, and historically low interest rates, There is simply more demand than supply.

Typically, the fall sees a significant decrease in activity, and sales prices tend to level off all the way through winter. There are quite a few factors that contribute to this. Fewer buyers equate to longer listing times and, in theory, price reductions, but in the fall there is also an inventory of homes that for one reason or another didn’t sell during the summer. It could be price, condition, or a number of other factors, but these properties remaining on market and dropping their prices leads to an statistical leveling off or even slight dip in sales prices compared to the spring and winter.

Does this mean you can expect to get a great deal? Maybe. Does this mean you can take your time with the process? Probably not. I worked with many analytically-inclined buyers in the early 2010’s, and it seemed like they were always looking for an excuse to not pull the trigger. Call it “analysis-paralysis”, or call it being motivated by fear over desire, but even the fall market of 2021 is not for the reluctant.

The playing field will be more level this fall than it was in May, but just remember Dallas is among the hottest markets in America. You may have to deal with multiple offers, but likely nowhere near as many as were faced in the spring.

Vague Specifics August 2021

As it turns out, Americans taking their first vacations in almost 2 years was just what the market needed to calm down a bit. The moment kids finally got out of school, the frantic state of the real estate market finally relaxed, and frankly, I couldn’t be happier.

“But John, you strapping yet annoyingly sensitive narrator,” I hear you ask, “surely a slower market is bad for appreciation!” Well, fictional person, as a homeowner myself and someone who plans on living in Dallas for at least the next 15 years, I want to see home prices remain as close-to-affordable as I can.

I’ve had several people ask me the last few weeks if Dallas is in for a market correction now that things are slowing down. To this I have a short answer and a long answer. Short answer: no. Long answer: Dallas was, for decades, one of the most undervalued markets in the United States. We are now victim of our own success, as hundreds of thousands of people migrate to our business-friendly environment, and we have rapidly caught up with the prices of other major metropolitan areas. Dallas is still cheap in the aggregate in that our (non-property) taxes are low, and the cost of goods-and-services still lags behind many regions. Prices – both housing and goods-and-services – are rapidly catching up, however, and the national labor shortage has done nothing to ameloriate that.

Interest rates still hover around 3% for a 30-year fixed mortgage. I may have mentioned this before, but the Dave Ramsey/Robert Kyosaki mantra of always paying cash is, for now, on it’s ear.

It’s really doubtful we’re going to see 20% appreciation in the coming years, but that doesn’t mean we won’t see 10+. The moral is this: the odds are really high that real estate is going to outperform the stock market in the next few years. I’m not an analyst and of course there will be outliers, but 10% return is nothing to scoff at. You may be paying 20% more than you would have paid a year ago, but buying real estate is still the most time-tested method of accumulating wealth.

Buying a Backup Generator

Architectural Corner: Italianate

MLS Statistics: April 2023

Architectural Corner: The Chateau

Vague Specifics – October 2021

Architectural Corner – Geodesic Dome

Real Estate Investors: The Good, Bad & Ugly

What to Expect from the Fall Market

Vague Specifics August 2021

MLS Statistics: April 2021

JOHN ANGELL, REALTOR®

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