Condo rule change would legalize many homes

Julie Ann Grimm: The New Mexican

A state law that goes into effect next month will halt the creation of new condominiums that don’t comply with the city zoning rules.

But most of the condos that skirted zoning rules in the city of Santa Fe during the last couple of decades won’t be negatively affected by the law change. If anything, insiders say, the law and a proposed change to the city code will clear up potential problems for small-time property owners who previously faced a legal quagmire.

About one-fifth of the city’s condominium associations contain dwelling units that exceed density limits for the lot size under city rules, according to a recent staff estimate. Of the roughly 4,309 condominium units that belong to 378 condominium associations in Santa Fe, officials say about 324 units exceed the maximum allowed density for the lot they were built on.

Prior to this year’s session of the state Legislature, buildings and lots could be subdivided as condominiums and recorded with the county clerk absent any city review. State Sen. Peter Wirth, D-Santa Fe, succeeded after several tries to get legislators and the governor to amend state law so that cities can opt to require such a review.

City officials are taking steps to codify the change here. A proposal to amend the city Land Use code was approved Monday by the Public Works Committee and is on the agenda for the Finance Committee next Monday. A final vote and public hearing at the City Council meeting is scheduled for May 30, after which it would take effect immediately.

The practical result of the city adopting such an ordinance change would be two-fold, city Land Use Director Matt O’Reilly said.

“This ordinance, in a nutshell, is a way of addressing, within reason, the condominiums that exist illegally,” he said, “and permanently stopping forever this from happening in the future.”

Of the estimated 324 units that are illegal today, the city ordinance will effectively “grandfather in” about 80 to 90 percent. O’Reilly said that term actually isn’t an accurate description of what would happen. The right term, he says, is that those units will become legal structures that don’t conform to city zoning rules.

A small group of illegal condos would not be legalized, however. They include condominium units that were built without a building permit, and those that are still owned by the person who originally created the illegal condominium. Lots where owners have development rights but have already put up too many dwelling units under zoning rules also won’t become legal under the proposed changes.

Most of the affected properties are on the north and east side of the city, and half of them were originally intended to be guest houses, he said. In those older parts of the city, O’Reilly said, there are many legally nonconforming structures already, owing largely to the fact that much of that region was developed before zoning laws were enacted in the 1960s.

Condominiums that would become legal nonconforming structures when the city approves the law change don’t require any additional paperwork to get that status, but O’Reilly said owners who wonder about the status of their condominium should contact the land-use department.

“If you have reason to believe that yours was built without a permit, you might want to come see us,” he said.

Permits ensure that electrical and plumbing systems are safe, among other details.

Another consequence of making the illegal condos legal is that owners who had previously run into hurdles in refinancing, sales and efforts at renovation will now be able to accomplish all of those tasks.

Jennifer Jenkins, a development consultant in Santa Fe, said she had mixed feelings when she first learned about pending changes to the state law and the city code, but she believes the city is moving in the right direction.

“We have to comply with zoning. We do. It is normal. And for somebody to purposely create a project that is a nonconformity, they are just creating problems,” she said. “They are creating problems for themselves. They are creating marketing problems. They are creating future legal issues. It is in nobody’s interest to intentionally do that.”

Jenkins said she is pleased that the city plans to add what she called “the grandfathering language” as a consumer protection.

Wirth, an attorney, said he backed the state law change because the system was causing situations that were nearly impossible to navigate.

“We call this a legal quagmire,” he said, “because you’ve got, oftentimes, an innocent purchaser who bought one of these things, with the title insurance, who then finds out that it was illegally zoned and that they have a piece of property that is not worth a whole bunch.”

 Link to Original Article

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One of the greatest attributes of this home is its location. The South Capital district is a cozy nieghborhood located within walking distance of nearly everything Santa Fe has to offer.  A two minute walk will get you to Kaune’s market, Ohori’s coffee, the State Capital, and the Guadalupe Cafe.  Walk another two minutes and you will be in the historic Santa Fe Plaza and all of the restaurants, galleries, museums, and shops in the vicinity.  The attractions of Canyon road are only a five minute walk from the house, and the Railyard district is only about seven minutes away. If you’re looking for a centrally located house, this is it.

This property also has income potential.  You could live in either house and rent out the other. Or, as an investment property, you could rent both. At a list price of $525,000, this house is a great buy.

For a full video tour of the property, check out the video below.

Contact Matt Desmond and Ryan Bolton

Additionally, the usually relatively negative Standard and Poors Case Shiller index also reported a rise in 14 of 20 major markets it tracks. This report represented the sixth consecutive month of price increases. 

The mortgage industry is also reporting good news for potential home buyers. Rates ranging in the 4.5% range (at least in the Santa Fe area) are being offered by the lenders we know in town, and they believe that this trend will continue for quite some time.

What does this all mean to the Santa Fe Home buyer? In our opinion…it’s a great time to buy.  The signs of a nationwide financial turnaround combined with relatively low home prices and historically low financing make home buying a better option than it has been in the past 30 + years. There are loads of great properties on the market in Santa Fe, and most seller’s have come to terms with the fact that their property values have taken a bit of a hit, resulting in competitively priced houses.

So if you’re in the market to buy in Santa Fe, give us a call!

Contact Ryan Bolton and Matt Desmond

Contact us for THE Highest Level of Service

1) The painting is finished!  Every room has received up to three coats of new white paint, and it’s amazing how different the house looks with all white on the walls.  The rooms feel significantly larger, the floors and ceilings really pop out, and the level of elegance in the home has risen significantly. All of the great details and characteristics of the home are now even more noticeable.

2) All of the new Myson heaters are fully installed and in working order.  Three different digital and programmable thermostats have been wired as well. The house is now warm and cozy!

3) The new cabinets in the kitchen have been installed.  This includes the installation of the washer and dryer and the new concrete counter top.  The concrete was still setting today when we filmed, so over the next day or two the guys will buff it up to bring the color out.

4) The floors have all been sanded and prepped for staining. Previously, the floors were  multiple shades and will now take on a darker stain that will match the vigas above.

5) In general, the guys have cleaned the place up a bit.  The ceilings and vigas have been wiped down and oiled, and many of the little messes here and there are now gone.

 All of the contract work should be finished in the next week.  We will then go into the design phase of the renovation which will entail the installation of window coverings, the building of specific furniture pieces (i.e. the bed), and the entire decorating process. Check back in for updates soon!

Contact Ryan Bolton and Matt Desmond

There are probably many reasons for the drop in house size. The obvious one is economics. During the recent economic and housing downturn buyers are needing to save money, and, thus, sacraficing space. Smaller bedrooms, smaller kitchens, and less “extra” rooms (I always think of the two, not one, “present wrapping” rooms that were noted in the Beverly Hills estate of the late T.V. producer Aaron Spelling). Additionally, larger homes are more expensive to maintain, heat, cool, etc. Here at homesinsantafenm.com we have also noticed that some people are wanting to “simplify” their lives. They are accomplishing this by living in smaller, more manageable homes that cost less money both to buy and maintain.

Looking into the crystal ball, what do we see? In Santa Fe we still have clients looking for all types of houses.  Families still want larger houses that can accomodate all of their needs, some retirees still want large homes to entertain, and some buyers want room to grow and roam.  However, other buyers are wanting to downsize, some retirees want less space to manage, and some families are realizing that they need less space. Basically, there is still a market in Santa Fe for all sizes of homes.

Contact Ryan Bolton and Matt Desmond 

The following article written by a director of the National Association of Realtors is a great read. It outlines the new government HAFA program, and discusses it’s potential impacts and implication.

Also, at the end of this post, take a video tour of the one listing we have that is listed as a short sale…it is an incredile opportunity and some savvy Buyer is going to to get a great deal.

Article:

Standardized Short Sale Process Will Benefit All Parties

by Bob Hunt

Two years ago the National Association of Realtors® formed a task force to address the vexing issue of short sales. A multitude of members had complained of lengthy and often incomprehensible processes that – although they varied in detail from lender to lender – all seemed to share the characteristics of being inefficient and irrational. Upon completing its studies the task force issued recommendations that the short sale process be standardized among lenders, that common forms be used, and that fixed time frames be adopted for various phases of the short sale process.

 Fast forward to November 30, 2009 when the Treasury Department announced the Home Affordable Foreclosure Alternatives (HAFA), a program that features – you guessed it – standardized short sale procedures, common forms, and fixed time frames. The program is directed to lenders and servicers participating in the Home Affordable Modification Program (HAMP). It applies to non Freddie Mac or Fannie Mae loans. It covers liens on a borrower’s principal residence up to an amount of $729,750 (higher if the property is 2 – 4 units).

HAFA is meant to help borrowers who either do not qualify for a HAMP loan modification or who have been unable to keep up their payments under such a plan. A major time-saving feature of the HAFA program is that the financial information already gathered in the loan modification application will be used to determine eligibility for the short sale program.

Prior to approving a borrower to participate in a HAFA short sale the servicer must determine the minimum acceptable net proceeds that the investor will accept. Each servicer must develop a written policy, consistent with investor guidelines, for making that determination. Then, once a borrower has been approved for the short sale program, the net requirement may not be increased for at least 120 days.

A borrower’s approval is expressed in a standardized Short Sale Agreement (SSA). The SSA must be good for at least 120 days. No foreclosure may take place while the agreement is in effect. The SSA requires that the property be listed and actively marketed with a “licensed real estate professional who is regularly doing business in the community where the property is located.”

Within three business days of an executed purchase agreement, the borrower is to submit a Request for Approval of Short Sale (RASS), which is also a standard form. Within ten days of receipt of a completed RASS, the servicer must indicate approval or disapproval. The approval cannot be contingent on a lowering of the real estate commission that had been agreed to. Also, the approval cannot require a closing in less than 45 days. Again, no foreclosure may take place during the period approved for closing.

One of the common hang-ups in short sales is the matter of junior liens. HAFA takes this into account, although perhaps not to a degree than junior lien holders might wish. The servicer may “authorize the settlement agent to allow up to an aggregate of $3,000 of the gross sale proceeds as payment(s) to subordinate mortgage/lien holder(s) in exchange for a lien release and full release of borrower liability.” Each lien holder may be paid up to 3% of their unpaid balance, but the aggregate of such payments may not exceed $3,000. They are paid up to 3% in order of their priority.

HAFA has financial incentives for all parties. The borrower receives a $1,500 relocation allowance, paid at closing. The servicer receives $1,000 for administrative costs. The investor will be paid one dollar for every three that had been paid to junior lien holders. If $3,000 had been paid to juniors, $1,000 would be paid to the investor.

The HAFA program will not apply to all loans, but it will cover a lot of them. Hopefully, it will bring a little more order and sanity to the process.

Link to original article here!

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Those zaney fellas at Zillow.com decided it would be interesting to first put a value on the White House, and then caluculate how much value it has lost over the past few years.  As expected, its value has decreased significantly over the past few years, even though the Obamas updated the place a bit.  Anyway, check out the following article that showed up at CNBC.

Article:

It just goes to show you, not even the president is immune to the real-estate slump.

As analysts slice, dice, mince and wedge the president’s first year in office, Zillow.com decided to take a look at his property’s performance, and found that the value of 1600 Pennsylvania Avenue has dropped by $15.6 million, or 5.1 percent in the past year.

The 132-room, 55,000-square foot home, which includes an underground bunker, was recently valued at $292.5 million, down from $308.1 million a year ago and $331.8 million in 2008, Zillow reports.

That’s despite improvements the Obamas made in the past year, such as adding a vegetable garden and a fancy swing set – not to mention all the celebrities who’ve graced its halls, including Microsoft chief Bill Gates, Goldman Sachs honcho Lloyd “I’m doing God’s work” Blankfein, and her O-ness, Oprah Winfrey.

Now before you go blaming Obama’s health-care reform plan or his crackdown on Wall Street bonuses for the declining value, consider that the Zillow home-value index, which measures the value of homes across the nation, was also down 5 percent in the past year.

And, it’s an improvement from when the home’s value dropped more than 7 percent during the prior year-while a certain Texan with very different politics resided there.

Still, it’s tough to cope with declining real-estate values. Do you think Obama’s contacted his bank about refinancing?!

Link to the Article Here

Contact Ryan Bolton and Matt Desmond

Our first post is a video tour of our fabulous listing located at 7 Vista Calabasas.  Here is the property description and a link to the post:

Rancho Calabasas; an immaculate, private, & unrestricted compound consisting of a main house, 2 guest houses, & your own private spa! An ideal property for a family compound or retreat. Perfect for entertaining w/separate guest suites for family or staff. Lushly landscaped grounds, a stream, waterfall, & Koi pond, & multiple outdoor entertainment areas, all on 5 filled acres. This Santa Fe oasis can be available turn-key including art, bronze sculptures, antique wagons, & furniture.

Check It Out Here!

We are very excited about our new youtube page, and we look forward to posting on it regularly.  As a HomesinSantaFeNM.com user, you will always find links to our youtube posts on the website, but you can also find them directly on youtube. Thanks for checking it out.

Contact Ryan and Matt

That brings the donation by Brutsche and his wife, Janice, to a total of 335 acres. In 2007, the couple donated the first 77 acres. The land is part of a 495-acre parcel called the Grevey property that Brutsche bought for a high-end subdivision. The original preserve was 190 acres.

The conservancy plans to build a public trail through the property to connect to the 22-mile Dale Ball Trails system. “Our next task is to figure out how the trails will go through the preserve, probably just for hikers,” said Terry Sullivan, executive director of The Nature Conservancy in New Mexico.

The latest donation was part of Brutsche’s commitment to protect land between his 107-lot High Summit III development along Hyde Park Road and the Santa Fe Canyon Preserve.

Sullivan said The Nature Conservancy still has to review the deed for the property and record it with Santa Fe County before the donation is completed.

Property owners can take a tax deduction for land donations equal to the market value of a piece of property. Sullivan said it was hard to estimate the land’s worth now because of fluctuations in real estate values. “Certainly multiple millions of dollars, probably in excess of $6 million,” Sullivan said.

The Brutsches’ attorney, Karl Sommer, did not return a call for comment.

The preserve has a 1.5-mile loop trail that takes hikers past wetlands and remnants of the old Two Mile Reservoir. Black bears, cougars, beavers and a large variety of birds live in or near the preserve.

Sullivan said The Nature Conservancy is working with the Santa Fe Watershed Association to restore a part of the Santa Fe River through the preserve and expand the riparian area. And “we will continue to monitor and cheer on the large colony of beavers that have moved into the preserve,” he said.

The Nature Conservancy owns and manages six preserves covering more than 1.4 million acres of land in New Mexico and millions of acres more in the U.S. and around the world.

Staci Matlock | The New Mexican