State discusses reopening Route 52, going out to bid
e-published 02/23/2006
Ocean City Gazette

OCEAN CITY – State and local officials met again Wednesday, Feb. 22 for a progress report on area traffic improvements including the Route 52 causeway.

For the first time since partially closing the span in January, that state revealed it will attempt to re-bid the Route 52 reconstruction project in June. Bids are expected to go out then on the first phase of the project, creating a new, elevated causeway to replace the ground-level one. Initial bids were rejected when they came in about $90 million higher than the $150 million the state originally budgeted for the work.

There was also talk of reopening the roadway – closed from four lanes to two – at the very least for the upcoming tourist season. Local officials stressed the importance the span has on emergency and rescue personnel, as it is a direct route to Shore Memorial Hospital in Somers Point.

The state says it is working on it.

In the meantime, state Department of Transportation officials have promised some relief in the form of a longer off-ramp at Exit 25 of the Garden State Parkway and an additional turn lane there by Memorial Day. Trucks over 4 tons have been banned from Route 52 while it is partially closed because of its rapid deterioration factor, also a main reason for the causeway’s closure. Those vehicles are now using Ocean City’s 34th Street bridge, in close proximity to Exit 25 of the Parkway. This detour has been causing traffic snarls in the Marmora section of Upper Township, where officials are extremely unhappy. They fear the situation will only get worse as the summer approaches.

Upper Township Committeeman Jay Newman, also the Marmora fire chief, has been vocal at township meetings on the issue and called Wednesday’s meeting in Ocean City another round of all talk and no action.

He said he was tired of going to meetings that discussed what could happen and would rather see immediately what would happen to remedy this situation.

O.C. likely to reject marina dredging bids
By MICHAEL MILLER Staff Writer, (609) 463-6712
Press of Atlantic City
Published: Friday, February 24, 2006
Updated: Friday, February 24, 2006

— City Council likely will reject bids to dredge eight marinas after the initial numbers came in greatly over budget.

The low bidder, Caldwell Marine of Toms River, submitted a price of $1.67 million to dredge approximately 40,000 cubic yards of silt and sand from the marinas.

That is $669,000 more than the $1 million the city budgeted for the job, Public Works Director George Savastano said Thursday.

The higher of the two bidders, Barnegat Bay of Harvey Cedars, submitted a price of $2.3 million.

The city planned to share costs with the private marinas' owners. The owners would pay for the actual dredging. The city would pay to mobilize the dredge and secure a disposal site, likely one in Egg Harbor Township two miles north of the city.

Under this arrangement, the city agreed to pay for no more than 50 percent of the total job.

The marinas are free to act independently of the city and strike their own deals with a dredging company. But Savastano on Thursday urged council to reject the bids. A formal vote is expected next month.

Ocean City has a narrow window to dredge its bays under the state permit because of protections on winter flounder and shellfish beds in the area. The city can dredge only between June 1 and Sept. 30. That likely means the marinas will go un-dredged until next year unless the private marinas take action independently.

As part of the dredging package, the city planned to include the public Bayside Center and some street ends, which comprised less than 5 percent of the total job, Savastano said.

Some residents have questioned the propriety of the city's dredging private marinas. The marinas in question are Nor'easter, Sunset Bay, Bay Club, Great Egg Villas, Harbor House, Favorite Harbor, Bay Villas and Brittany Drive. Each has its own condominium association.

The city expected more interest from area dredge companies. But only two bidders responded.

Keeping Vacation Rentals Out Of The Deep Freeze
by Broderick Perkins
Realty Times


As the winter grinds on, some vacation property owners begin to wish they were snowed under -- by requests for accommodations.

Winter can be harsh on investors who don't offer resort accommodations, but own and rent out property where winter wails and snow falls.

From Labor Day one year to Memorial Day the next, the same cabin or condo renters clamor for all summer can languish unrented and that can be a pain in the bottom line.

To help vacation property owners devise a marketing plan to overcome seasonal rental doldrums we sought advice from Christine Karpinski, real estate investor, author and director of Owner Advocacy for HomeAway.com, formerly WVR Group, a network of vacation rental listing websites.

Here's what she advises to keep visitors visit all winter.

"Obviously, more people vacation during peak season, but there are plenty of people who prefer to travel during the cooler months. Maybe they want to avoid the crowds, maybe they want to take advantage of the lower rates, or maybe they just want a break in the February doldrums," Karpinski says.

Property owners who want to target seasonal vacationers need seasonal appeal to make their vacation home stand out.

Here's what Karpinski advises:


Put some antifreeze in your marketing. Play up warming features including hot tubs, fireplaces and sun exposure. Add some "off-season" photos of your property to your website and listings. A photo of a home framed in rainbow hued autumn leaves or dusted with snow speaks volumes.

Improve your property. If your property doesn't already have them, consider installing a hot tub, sauna or ventless gas fireplace (and carbon monoxide detector), especially if your vacation property is a "summer home" sans winter appeal. Such additions quickly pay for themselves in terms of increased off-season bookings.

Turn on off-season specials. Everyone loves a bargain. In the winter, tourists and travelers expect them. Consider rent-three-nights and get-one-free offers. When travelers call to book for the spring or summer, offer a winter special, half-price off on a weekend stay or deeper discounts during the even-less-traveled wintry weekdays. The opportunity to case the joint early -- for a steal -- is tough to resist.

Use the holidays. Put up Christmas decorations, stock some Yule Tide CDs (from Frank Sinatra to hip hop) and set out a selection of family-oriented Christmas DVDs (The Polar Express is the new classic) in early November. Holiday trappings delight everyone's inner child and can add to your renters' vacation enjoyment. And then they'll also know were to get away from it all -- or get it all early -- the next time they consider an early winter vacation.

Get cozy. Put thick, warm comforters on the bed and fleece throws on the sofa. Place a few spice-scented candles and bowls of potpourri on tables and counter tops. Set out a snowman or snowwoman making kit (an old hat, shawl and mittens, buttons, faux plastic carrots or some real ones in the fridge. Leave savory winter treats in the kitchen -- chocolate milk makings and marshmallows, spiced apple cider, winter tea, ginger cookies, chili fixings and a crock pot. Consider leaving an extra coat or two (an extra one for the snowperson) in the closet, along with toboggans, gloves and scarves. Chances are they won't be used, but guests will appreciate the thought.

Let it snow, but plan for it. Should guests get snowed in, make the experience as pleasant as possible. Standard equipment on the premises in snow country is a snow shovel, ice melt and a windshield ice scraper. Stock in some nonperishable foods, magazines, books and board and video games. The last thing you want is a houseful of cranky renters, roiling with cabin fever, cursing their vacation experience and, by association, you.

Baby-proof your home. Make your home welcome to baby's and toddlers. People with small children often travel during the off-season when they aren't constrained by school schedules. Adding baby and toddler gear like a high chair, play mat, porta crib or rustic bassinet can increase off-season bookings. Don't forget electrical outlet covers and safety latches for the cleaning supply cabinet.

Who left the dogs out? Vacation properties that accept pets increase their occupancy by 10 to 50 percent. When you accept pets, it's okay to take an additional $20 to $25 per night, or $140 or more a week. Pet owners spend at least that much on kennel fees for pets they leave behind. The extra amount is also enough to pay for carpet cleaning.

Conduct outreach marketing. Offer specials for repeat guests. Contact "VIP" guests and offer discounted off-season stays. Link stays to special repeat events in visitors' lives. For example, If you know a couple has an anniversary coming up in March (because of the detailed dossier you keep on them) offer a special celebratory weekend package at a reduced rate. When they accept, have a champagne gift basket waiting for them in the bedroom along with a handwritten "Happy Anniversary" note.

Be charitable. If you have a vacation home in or near areas that sustained damage from the 2005 hurricane season, perhaps you can house the needy for a while. Visit the Federal Emergency Management Agency's (FEMA) portal for housing.
Karpinski says property owners who take a bottom line hit from reduced prices, freebies and improvements should consider the effort "damage insurance." Winter renting can ward off vandalism and property damage. Houses that go vacant for long stretches, especially in frigid weather, can develop problems -- frozen water in the plumbing, for one -- that wouldn't occur with frequent visitors. At the very least, problems can be discovered early and tackled before they worsen.

"A little effort goes a long way. Do one or two things on the list, not all of them. Otherwise, do a good job with the basics and be a friendly, hospitable host. As word gets around and your guests become regulars, your off-season problem will solve itself," Karpinski said.

Published: February 23, 2006

Experts offer a warning: A.C.-area homes overvalued
By J. STAAS HAUGHT Staff Writer, (609) 272-7253
Press of Atlantic City
Published: Wednesday, February 22, 2006
Updated: Wednesday, February 22, 2006

With home prices throughout Atlantic County continuing to pull in high double-digit appreciations, a financial data and services group is labeling the area “extremely overvalued.”

The House Prices in America, Third Quarter 2005 report by National City Bank and Global Insight puts the Atlantic City Metro area at No. 13 on the list of most overvalued housing markets. The area is nearly 60 percent costlier than it should be, the study suggests.

The region has been on the quarterly list for some time, but was just highlighted in the current edition of AARP Magazine.

Richard DeKaser, chief economist with National City Bank, won't call the overpricing a bubble, but said the 58.6 percent overvaluation puts the area at risk of a price correction.

Real estate agents, however, argue the market is right where it should be.

Mark Carrier, president of the Atlantic City and Atlantic County Board of Realtors, said warnings of overvaluations and an inflating market are commonplace and rarely take into account local market diversions.

“I would call it inaccurate. If the study only looks at the Atlantic City coastal community, that market is not necessarily supported by local homeowners; it has a large second-home industry. If it is the broader region, it's mixing communities like Brigantine, Longport, Margate, where buyers expect to pay more, with other communities that very well may be undervalued,” he said. “Most of these studies look only at median values and income and then suggest an overvaluation. That doesn't apply in this market.”

The study does not just look at median sale prices, household incomes and appreciation levels, though, DeKaser said.

Rather, factors like local interest rates, household population densities, income levels relative to national averages and market constants, such as expected income-to-housing price ratios, are considered in determining the model home price. Then, the median value for all existing homes during the 2000 census are weighted against the current appreciation indices by the Office of Federal Housing Enterprise Oversight.

The difference between the model price and the actual price is the over- or undervaluation.

For Atlantic City, DeKaser's model home price is $148,894, compared with an actual price of $236,203.

DeKaser said the valuation is more complete because it weighs such influences as buyers' desire to live in a specific area and long-term housing trends. The studies are based on 20-year windows.

“What we come up with is what we think is a pretty accurate idea of what should home prices by compared to what home price are,” DeKaser said. “We do look at a more complete picture.”

He said small dips recently in the overvaluation suggest buyers, sellers and agents are aware of the pricing problem.

Daniel Maloney, an agent with Boardwalk Realty in Atlantic City, defended prices for Boardwalk and beachfront properties in Atlantic City, but did concede that some mainland communities are overpriced.

“I will admit that places like Mays Landing, Absecon, Egg Harbor Township, where large tracts of land have created a lot of competition for development, are seeing increases that might be an overvaluation,” he said. “There is room for adjustment out there, I would say.”

Carrier, however, said homes in some of those areas represent a bargain.

“You still have great values in Galloway or Absecon, places like that. There is no overvaluation there, not in my opinion. I'd say the county as a whole is probably about neutral.”

There is some credence to DeKaser's figures, though.

Agents and brokers in the Ocean City area are now saying the market's valuations retreated by about 10 percent recently.

The Global Insight/National City report, while still calling Ocean City extremely overvalued, noted its recent softening. From June to September, the area's overvaluation dipped from 54.8 percent to 46.7 percent.

“In fact, we saw this for the first time in the third quarter for many markets. The decline in degree of overvaluation — which is not to say it corrected itself — is falling. It suggests that we may no longer be in a rising tide with all areas going up together. Some of the hotter markets might be hitting their ceilings,” he said.

Carrier, too, expects some softening for the Atlantic City region. Instead of the 14 percent to 20 percent appreciations realized in the last few years, values might only rise 7 percent or 8 percent going forward.

“Those are good numbers. That's where it should be in the long term,” he said.

Time eats away at Ocean City eateries
By MICHAEL MILLERStaff Writer, (609) 463-6712
Press of Atlantic City
Published: Tuesday, February 21, 2006
Updated: Tuesday, February 21, 2006

— Joe Ianiro opened a new restaurant in town this month, the Ocean Room at the historic Flanders Hotel.

Business owners warned him that opening a restaurant in Ocean City in the dead of winter was — to put it delicately — inadvisable. His friends were more to the point.

“They said I was absolutely insane for opening in February. They said I was crazy to try,” he said.

Ianiro said he is hoping to fill the void created by the recent closing of many longtime island eateries. This resort town is losing established restaurants knife over fork as older restaurateurs retire or sell to developers.

“I heard they recently lost six restaurants. A lot of waitresses were really upset,” Ianiro said.

Shafto's Restaurant closed after more than 60 years downtown. Hickman's Seafood, a popular takeout shop on Asbury Avenue, is now a bare patch of dirt awaiting new residential construction. The same fate befell the Green Grill on 17th Street and several other shore favorites.

“There's quite a few that we've lost, yeah,” said Tom Cox, who is in charge of the city's mercantile licenses.

Anecdotally, the mercantile office said the city is losing more eateries than it is gaining, so much so that Cox took note of the trend. Defining it quantitatively would be difficult, he said, given the broad range of food establishments covered under the same license.

Diners have no choice but to look for new haunts.

“We live two doors down. We used to eat here all the time,” Ocean City resident Sig Salmento said of Hickman's. For 111 years, the shop had been an island staple for summer visitors.

“It was very popular. I liked the fish filets,” Salmento said.

Now, he gets his seafood downtown at Ike's Famous Crab Cakes.

Some family restaurants in town have closed because the owners are ready to retire, said Joann DelVescio, director of the Ocean City Regional Chamber of Commerce.

“I think it's a symptom of restaurants. It's a difficult business,” she said. “Many of our restaurants are seasonal and find it difficult to make the numbers work in a single season. As the year-round population decreases in Ocean City, there isn't necessarily the support for a restaurant to be open year round.”

Ocean City's year-round population is holding at about 15,500, according to U.S. Census Bureau figures. But this population leak is not isolated to Ocean City. The 10 towns in New Jersey that lost the most population in 2004 were all in Cape May County.

With 80 places serving food now and another 163 seasonal restaurants, stands and take-out joints open in the summer, nobody on the island is going hungry for lack of menus.

“I've heard people say all the eateries are leaving but I don't see it,” said police Lt. William Wilent, an Ocean City lunch connoisseur. “I've seen some go. I've seen some come.”

Like most restaurants on the island, the Ocean Room should have no trouble attracting a crowd in the busy summertime. The place features contemporary American cuisine in its spacious dining room and outdoor patio. The restaurant also handles room service for the Flanders. But Ianiro said his goal is to make the place a neighborhood favorite.

“That's why we're doing the early-bird dinners and the breakfast specials,” he said. “We're really gearing it toward the locals and not the tourists.”

Sales slower, prices lower for houses in Ocean City
real estate

By MICHAEL MILLERStaff Writer, (609) 463-6712
Press of Atlantic City
Published: Tuesday, February 21, 2006
Updated: Tuesday, February 21, 2006

— Robin Goldcott thought her Wesley Avenue home would sell quickly when she put it on the market last March.

Nine months later, she and her husband, Mark, finally found a buyer — but only after slashing the price by 5 percent.

“I didn't know if it was overpriced or what,” she said. “It took longer than the agent thought it would. My husband and I thought the market was cooling off.”

Real-estate agents say more properties are on the market now than a year ago. And they're selling more slowly than in recent years. Of course, everything is relative. Ocean City's super-heated market still attracts buyers from as far away as California and Arizona.

Ocean City property owners sold 54 homes in the first six weeks of 2006, or about half as many as it did in the same period last year, said Jesse Briglia, owner of Jesse Real Estate.

Prices in the resort have dropped about 10 percent in the past year. Or, as Briglia put it, Ocean City is having a 10-percent-off sale.

“It's not a doom and gloom scenario. We're still selling product,” he said.

Real estate agents said some sellers have unrealistic expectations about what prices the market will bear. In the end, investors still make a tidy profit.

“We're not seeing any fire sales. Nobody is giving their property away,” agent Tony Cannata of RE/MAX said.

He said there are twice as many properties for sale in Ocean City now than a year ago. But winter is the prime selling time of the year for resort properties, he said.

“I don't have any nervous clients. They realize the market's a little slower,” he said.

Dennis Dreibelbis, of Valley Forge, Pa., spent his summers in Ocean City and wanted to give his children the same experience. He bought a summer home here in 1991. With his children grown, he decided to sell.

“It took longer than I anticipated,” he said. “The price came down considerably. But I feel fortunate having sold it when I did.”

He found a buyer in December, about six months after his home went on the market.

Despite the price slashing, Dreibelbis quadrupled his investment. He is putting his money into his new Valley Forge restaurant, The G-Lodge. He still has an Ocean City connection. His grown daughter liked the island so much she decided to make it her year-round home.

Some Cape May County barrier islands watched properties escalate in value by 3 percent per month or 36 percent per year, far outpacing national home prices.

Briglia said Ocean City has little to worry about for the next decade as more baby boomers transfer their accumulated wealth.

“If you follow the demographics, there are at least 12 years of up-cycle in the boomer market,” he said.

And with families making new memories every summer, real-estate agents can look forward to another generation of eager buyers.

“In a resort market, we're selling the sizzle, not the steak,” Briglia said. “We sell from emotion here.”

Banner day for home rule
Couple not buying `For Sale' sign ban
Tuesday, February 14, 2006
By MARK PERKISS
Staff Writer - The NJ Times

Planting a "For Sale" sign on the front lawn is one of the first things people do when they decide to sell their homes. It's practically the American way.

But Joan and Kenneth Tencza, who live in the Locust Hill adult community in Hamilton, can't. Their homeowners association won't allow it.

So after receiving two threatening letters from the association's management company -- one for posting a "For Sale" sign in their front window and another for a sign they put on Yardville-Hamilton Square Road, just outside the entrance to the development -- the couple has found an innovative way around the rules.

They've hung a festive red and white flag outside their home to let people know the house is on the market.

"The rule is no signs, but decorative flags are allowed. So I put up a decorative flag," Joan Tencza said with a grin.

The white and red homemade flag says "For Sale by Owner" and has the couple's telephone number, along with a large heart with an arrow through it.

"That's because it's February, and Valentine's Day is in February," she said. "In March, I'll decorate the flag with shamrocks for St. Patrick's Day, and in April I'll use Easter eggs and Easter bunnies."

The need for the imaginative approach to home-selling is an example of the kinds of restrictions many homeowners associations, both in New Jersey and across the country, place on people who buy homes in those communities.

Bill Cupit, president of the Locust Hill homeowners association, declined to talk about why the sign ban is in place and referred calls to the organization's management company, P&A Management Inc.

P&A President Al Pellegrino said the restrictions on "For Sale" signs generally start with builders of the developments, who do not want competition when they are trying to sell homes. The restrictions are then retained by the homeowners associations. "Most associations don't want the signs littering the community," said Pellegrino, whose company manages 15 homeowners associations, mostly in Mercer County. "They feel if you want to sell your home, work with a real estate agent, advertise in the newspaper and use the Multiple Listing Service."

Homeowners associations increasingly are coming under fire by disgruntled homeowners who argue they should not have to give up their rights to move into developments controlled by associations.

And courts are starting to agree.

A three-judge New Jersey appeals court panel last week unanimously ruled that the Twin Rivers development in East Windsor and all other New Jersey developments run by homeowners associations must allow residents to put political signs on their property and publish opposing views in association newsletters.

The Tenczas, who plan to move to Florida, are hoping that ruling also applies to their desire to post a "For Sale" sign on their property. But they're using the flag in the meantime.

"We knew the rules when we moved here, but that doesn't make them right," said Kenneth Tencza, who was a vice president of the homeowners association for two years. "When I was on the board, I fought in favor of signs. I lost."

Frank Askin, the Rutgers University law professor who brought the Twin Rivers case, said the logic the appeals court used in its ruling last week should allow homeowners to put "For Sale" signs on their lawns. "I don't see how "For Sale" signs could be barred under this ruling, but that would have to be tested in court," he said.

Real estate agents say sellers and buyers are at a disadvantage when "For Sale" signs are banned.

"Most buyers look through various neighborhoods before they contact a Realtor," said Peter Doolan, the owner of Doolan Realty in Ewing. "If the property doesn't have a sign, then there's no way for the customer to know if the property is for sale.

"A house with a sign on it gets activity faster, and that leads to better pricing for the seller," Doolan said. "Realtors have a lot of tools in their toolbox, but putting a sign on the property is the most important by far."

Chuck Shaw, an agent at Century 21 Abrams Hutchinson & Associates in Plainsboro, agreed.

"Not having a sign makes it difficult for me to advertise my name or the particular home other than to folks who are already looking with an agent," he said. "That limits your market, and if you're a seller, you don't want to do that."

Pellegrino wasn't buying it.

"At Locust Hill we've had a number of homes sell without difficulty, and we're a `no sign' community," he said.

Joan Tencza said she's not trying to annoy her neighbors -- just sell her house. "There are 247 houses in this development, and based on our association dues, we own one 247th of the property," she said. We only want to put a sign on our part."

Contact Mark Perkiss at mperkiss@njtimes.com or at (609) 989-5723

Jersey home prices still rising
In New Jersey, home sales may be falling but prices are still red hot.
Star Ledger

In its quarterly survey, the National Association of Realtors found existing home sales in New Jersey, which includes single-family home and condos, dipped 7.7 percent in the fourth quarter compared with the same period a year earlier.

Nationally, existing home sales rose an ever-so-slight 0.3 percent during the fourth quarter.

But across the country, home prices continued to soar. Nationally, the median price of a home rose 13.6 percent to $213,000. Of the 145 metro areas surveyed, 72 showed double-digit gains, according to the NAR.

In the Northeast, the median price of a home rose 8 percent to $240,300. The strongest gains in the region could be found in the New York City-Wayne-White Plains area of New York and New Jersey, where the median price of a home soared 19.2 percent to $537,300. The larger region of the New York-Northern New Jesey-Long Island area climbed 16 percent to $459,600.

Contributed by Sam Ali

New Crime Stoppers signs prove a ringing success
By LYNDA COHENStaff Writer, (609) 272-7257
Press of Atlantic City
Published: Friday, February 17, 2006
Updated: Friday, February 17, 2006

Early signs point to success in Atlantic County's newest Crime Stoppers initiative.

The nonprofit group unveiled its new signs in Atlantic City on Feb. 6. By Wednesday, city residents had made 13 calls about incidents that have occurred within the past month.

“We've been lucky if we've gotten 13 in a year, so this is definitely because of the signs,” Chairwoman Carol Ruffu said Thursday.

Crime Stoppers allows residents to call in tips about criminal activity anonymously, making them eligible for monetary awards if a suspect is caught and convicted.

There are about 100 new signs in Atlantic City and dozens going up in other municipalities in the county. The best part for the donations-driven group is they have not cost them a thing.

In an agreement with the administration, Atlantic City's signs are being made by the city sign shop. With the city's support firmly in place, Ruffu went to Atlantic County Executive Dennis Levinson to see if the county could provide signs to the other municipalities. There was such a demand that some cities are on a waiting list for the new signs.

“They're waiting for materials to come in,” Ruffu said. “They should have signs next week.”

Pleasantville has not received its new signs yet, but there were four tips from residents there since Atlantic City's unveiling. Ruffu credited newspaper coverage.

But the group isn't spending too much time celebrating as it moves on to new projects.

The focus is now turning to Scholastic Crime Stoppers, a school-run program that gives students a number to report problems in the schools.

“It's where the kids can feel comfortable and report fellow students they know have weapons on them or those who are into gang activity,” Ruffu said.

Crime Stoppers gets the group started, but it is entirely run by the district, including setting up the number. As with the Crime Stoppers program, tips may be made anonymously and there are monetary rewards.

Absegami High School already has one. Now Crime Stoppers is looking to help set up programs at Atlantic City, Pleasantville and Egg Harbor Township high schools.

Who's Who in Your Town/Ocean City
Press of Atlantic City
Published: Thursday, February 16, 2006
Updated: Thursday, February 16, 2006

Council Composition: Nonpartisan

City Council Members: Jack Thomas, Larry Carnuccio, Frank McCall, Ronald Denney, Jody Alessandrine, Gregory Johnson, Roy Wagner

Mayor: Henry “Bud” Knight

Clerk: Cindy Griffith

Solicitor: Gerald Corcoran

Business Administrator: Richard Deaney

n City Hall Phone: 399-6111

City Council: Second and Fourth Thursdays at 7 p.m.; workshops scheduled as needed.

n Planning Board: First and Second Wednesdays at 7:30 p.m.

n Zoning Board: Third and Fourth Wednesdays at 7:30 p.m.

Number of city-issued cell phones: 54

Miles of road maintained by the city: 90 miles of streets and 30 miles of alleys.

Ocean City considers moving fourth grade to primary school in fall
By MICHAEL MILLER Staff Writer, (609) 463-6712
Press of Atlantic City
Published: Thursday, February 16, 2006
Updated: Thursday, February 16, 2006

The Board of Education on Wednesday outlined a proposal to move fourth-graders from the intermediate to the primary school this fall.

Curriculum Director Walt Whitaker said both schools offer the district newfound scheduling flexibility because of declining enrollment. Ocean City lost about 150 K-8 students in the past five years, he said.

Likewise, the district sees few temporary students whose families live on the island during the winter. Traditionally, the off season has offered cheap rents for seasonal residents whose children attend Ocean City schools part of the year. But these seasonal homes are becoming scarcer in the new, pricier real-estate market.

“There are not a lot of reasonable rents on the island,” he said.

Likewise, Ocean City's enrollment is declining at rates faster than expected. A 1992 enrollment study predicted the district would have 1,800 students. It has just 1,450.

Under the move, fourth-grade students would adopt the typical K-3 model classroom in which students remain in one classroom with the same teacher for most of the day. Meanwhile, fifth-graders would adopt the typical middle school model in which students move from class to class and teacher to teacher throughout the day.

As part of the move, the board might increase class size by trimming the number of classes per grade.

The board still must decide whether the district's current fourth-grade teachers will make the move to the primary school or whether the primary school teachers will absorb the new classes.

Under the proposal, Whitaker said there might be some changes in scheduling for some programs. Some in-school programs might be turned into after-school programs. But Whitaker stressed that the proposal was tentative.

“We're just putting this out there to get input,” he said.

Teachers and parents who packed the meeting room lobbied to keep school programs intact. They also objected to the suggestion of increasing class size and wondered why their opinions were not solicited before Wednesday's presentation.

“Someone is playing Solitaire … when they should be playing Bridge,” third-grade teacher Karen Heist said.

She urged the board and administrators to sit in on classes at the primary school before making any decisions.

“Before you cut our programs and increase our class size, why don't you pay a visit?” she said.

The board made no decision Wednesday as it was a workshop session.

A.C. retailing hits its stride
Flush with success, The Walk is to double in size
By Suzette Parmley
Inquirer Staff Writer
Posted on Fri, Feb. 10, 2006

ATLANTIC CITY - The dozen casinos here generated $5 billion in revenue last year, thanks in no small part to visitors who frequented the eight-block outlet mall that links the Boardwalk and the city's convention center.

Atlantic City Outlets - The Walk has been so successful in attracting non-gamblers to the resort that it will soon double in size. Groundbreaking is scheduled late next month for the first phase of a $155 million expansion that will add new shops, restaurants, condominiums and offices above retail outlets on the west side of Michigan Avenue.

"We always believed that all the pieces were there for a very successful retail center, and we've proven it," said Gary Block, vice president of Cordish Co., the Baltimore-based developer of the Walk. "It's been so well-received."

Block said he measured the success of the Walk by the level of interest by prospective tenants, the sales volumes the tenants achieved, and tenants' accounts that they had exceeded their expectations.

Block said tenants for the expanded Walk would begin moving in by the end of the year, with completion scheduled for late spring 2007.

Cordish spent $49 million building the Walk, which debuted in August 2004, as the city's first major foray into the world of retail. It currently has about 60 stores and 11 restaurants and bars, including the 40/40 Club, a sports bar and lounge co-owned by hip-hop rap artist Jay-Z. The latest to open was a Ruby Tuesday restaurant on Jan. 31.

The city's Casino Reinvestment Development Authority pitched in $31 million to help finance construction of the Walk. Block said the CRDA would not provide a subsidy for the expansion project.

Block said the Walk would add 40 stores with more international brands, as well as more nightclubs and bars. He said it was 100 percent pre-leased and that there would be no repeat stores from the original Walk. Block, who declined to give the names of the retailers, said they were "of equal value, if not greater, than your Polos and your Coaches."

Block said he had to turn away many prospective retailers because he could not accommodate them. "We have more prospects than spaces," he said.

Peak season at the Jersey Shore - even Atlantic City - is summertime. Block said the Walk, which runs mostly along Michigan Avenue, from Baltic to Atlantic Avenues, had a key advantage over the famed Boardwalk.

"A lot of the Boardwalk shops are closed during the winter," Block said.

Cordish has earned a national reputation for specializing in public-private ventures to redevelop and revitalize urban areas. It has similar urban retail-entertainment districts in Baltimore; Houston; Louisville, Ky.; and Charlestown, S.C.

Cruz Santos, 40, who grew up in Atlantic City, is a regular at the Walk. He lives within blocks of the outlet mall and works for an Egg Harbor City firm that cleans exhaust systems for the casinos.

"This brings sort of a relaxed atmosphere," he said, while shopping at Factory Brand Shoes. "It's definitely changed the city. It's become more family-friendly."

Deb Holz, 37, made the Walk an all-day outing with her friend, Dorothy Daniels, 50, last week.

Holz lives in Bechtelsville, Berks County, about two hours from Atlantic City, and 20 minutes from Limerick Township, Montgomery County, where Boyd Gaming Co., which co-owns the Borgata Hotel Casino & Spa here, has proposed building a slots parlor.
Atlantic City casinos have been girding for the pending competition from
Pennsylvania slots parlors, and retail complexes like the Walk have become a tool for them to encourage customers, like Holz, to keep coming back.

Holz said she spent $110 shopping and $155 gambling last week.

"I'm having a lot of fun," Holz said, after buying a pair of bright red boots marked down 70 percent, a pair of jeans and jewelry at Bass. Daniels, of Pottstown, Pa., purchased a black leather belt that was on sale for $20.

After shopping all afternoon, Holz and Daniels went to "gamble a little" at the Sands Casino Hotel, where Holz could exchange the complimentary points that she accumulated on the slot machines for gift certificates at the Walk.

When the expansion of the Walk is completed, it will contain 700,000 square feet of retail.

During its first year, the Walk achieved average sales of $400 per square foot, outpacing the $200-per-square-foot average sales of a typical outdoor strip mall, according to company chairman David S. Cordish.

"We've easily exceeded that number," Block said yesterday. He declined to give revenue figures, only saying the sales generated by retailers at the Walk collectively were in the top 5 percent of all outlet centers in the country.
Factory outlets, like the Walk, are the fastest-growing retail sector. While 19 outlet malls are planned nationwide to be built through 2007, only seven enclosed shopping malls are in the planning stage, according to the Washington-based International Council of Shopping Centers.

Kim Butler, the Walk's general manager and marketing director, said gambling and retail were ideal partners.

"They complement each other because you can have the avid shopper who is a $20 gambler," she said, "vs. a gambler who's maybe a $20 shopper. But they might be together."

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Contact staff writer Suzette Parmley at 215-854-2594 or sparmley@phillynews.com.

Ask Realty Times
by Peter G. Miller
Published: February 10, 2006

Question: My wife is interested in becoming a real estate salesperson, and I would like her to take some self-defense classes. She doesn't think they are necessary. Can you provide me with any statistics on crime against brokers to help? Or point me to a good source.

Answer: There are more than 2 million people with real estate licenses and it follows that with such a large population there are instances of crime. Many brokerages have common-sense protocols regarding safety that can greatly protect salespeople against crime. As an example, when prospects know that scheduled phone call-ins from home showings are expected, you have a simple and easy crime deterrent.

Local police can provide advice regarding what's lawful in a local community in terms of protective devices. The local Realtor association can suggest safety strategies.

As to self-defense classes, one has to look at them with some balance. People who can plainly defend themselves are less likely to be attacked simply because other targets are easier. At the same time, retail outlets commonly tell employees not to fight back if a store is being robbed. Even if you have a black belt in a given fighting style, common sense is still required.

Question: Who pays closing costs? The buyer or seller?

Answer: Offer forms often have a standardized way to divide closing costs according to local custom. Common divisions are 50/50 between buyer and seller, or one side or the other may pay all costs if other factors in the offer are sufficiently attractive -- or if the marketplace greatly favors one side.

Question: I'm wondering what does "improvement value" mean in real estate? I looked up the taxes for my property and it shows an "improvement value" and the total assessed value. What is the difference?

Answer: Real estate is usually seen as having two components: There is the "land" on which a home sits and then there are "improvements" on the land -- items such as the house, garage, shed, pool, etc. Pulled together, the land and improvements equal the total value of the property.

Question: I just made an offer for my first home, a foreclosure that the bank owns. My first offer for $165,000 was rejected. The bank would not budge unless they got the asking price of $187,500. The house needs work and it's an "as is" house. I won't know exactly the work needed until I get it inspected.

I have the tools, the knowledge and the manpower to do all the work. So my dollar is worth more in my pocket than the bank's. My questions are: Do I put money down or do I use that money to fix the house? What type of loan would you recommend? Interest only? For how long?

Answer: The question of financing is far down the list of immediate issues. If you acquire the house and add in the value of your work or the work of contractors, what will be the sale or rental value of the property? Is the new value worthwhile given other investment opportunities?

Until you inspect the house you can't judge potential costs, so it's not possible to know if the bank's price is attractive or not.

As to what form of financing might be best, that will depend on such factors as your financial situation, potential rent or sale value, past experience as a developer, etc. If the pricing is right, you might want to look at FHA 203(k) acquisition and rehab financing.

Question: My parent-in-law bought a house, but instead of using her name, they let my wife be the "owner" (the reason being that they were not qualified for the loan). Now they want to sell their house with a profit. Will the IRS see that as another income for me and my wife?

Answer: Your parent-in-law has no house to sell. It's not his or her house. Your wife is the owner of record and she is the mortgage borrower.

Have you been deducting mortgage interest and property taxes? Have you been reporting the receipt of a fair market rental income? Have you been depreciating the property?

Before considering the tax implications of selling the property, you first need to consider how it has been treated -- or should be treated. For details see a tax attorney, CPA or enrolled agent.

Question: Is the two-out-of-five year rule valid today? That is, if a person has lived in a house for two out of the last five years before it is sold, the person can exclude up to $250,000 (single) or $500,000 (joint) of any profit made on the sale?

We're moving into a new house this summer, and are undecided on what to do with our current house. Do we sell it, or rent it? The answer may lie in whether we have to pay capital gains tax on the house or not.

Answer: Generally, if you have used a property as your prime residence for two of the past five years you are entitled to the capital gains exclusion -- $500,000 for married couples and $250,000 for singles.

As the IRS explains: "To exclude gain, a taxpayer must both own and use the home as a principal residence for two of the five years before the sale. The ownership and use periods need not be concurrent.

The two years may consist of 24 full months or 730 days. Short absences, such as for a summer vacation, count as periods of use, but longer breaks, such as a one-year sabbatical, do not. The taxpayer also must not have excluded gain on another home sold during the two years before the current sale."

For details, speak with a tax professional such as a CPA, enrolled agent or tax attorney.

Question: How can a person best learn about investing in real estate? Where should a person start?

Answer: The best way to start, by far, is to take the basic course required to get a real estate license in your jurisdiction. When passed, this course will qualify you to take the test to get a real estate sales license. Equally important, it will introduce you to a host of ideas, standards and requirements whether or not you get a license. With this information you can then have a better idea of where to start.

Question: I plan to buy a condo. Do I need to hire a lawyer, or would the services of a title company be sufficient?

Answer: What you first need is a buyer broker to locate a property which best meets your needs. Because state rules and customs vary extensively, the broker can explain how attorneys, title companies and other options are used in the jurisdiction where you're purchasing.

Question: I have lease option on a property. Last March I received a loan that would satisfy the full payment of the asking price of $425,000 through refinancing. My lender took into consideration the monthly payment that I paid to the landlord on time every month.

When I went to the closing table the owner decided that he will not sign the closing documents because he had to wait three days for his money because of the three-day right of rescission. The title company that he used also informed him not to sign the documents because we cannot refinance a home that we did not own. If we refinance a lease-purchased home will the lender take into consideration the rent that we have paid?

Answer: The idea of the three-day rescission period is to protect the borrower when re-financing. Since you are the buyer, what is there to refinance? Is the idea for the seller to finance the property and then for you to instantly assume the loan? If yes, why would that appeal to a lender? Why not just get an acquisition mortgage for yourself?

Before going further, please contact a local real estate attorney to determine what the lease-option requires from the seller -- and from you.

Question: We've been living in an area which is considered very desirable because of the recognized school district, nice parks and proximity to a major airport.

We were planning to sell our home to move closer to my husband's job and my son's school. We tried to do this move two years ago, when our house was on the market about four months at a competitive price, but the offers we had were rather disappointing.

Since it's an 18-year-old house, people were expecting us to fix up every single detail or lower the price. If we lowered the price, however, we would have had to sell the property at the price we paid three years before even though we put it new wood floors, changed several windows, painted it, etc.

In the past two years we've been trying to fix up everything else we thought important, adding about $10,000 or more in upgrades. However, we talked to a broker recently, telling her about our plans to put the house on the market again, and the selling price she suggested this time was $5,000 less than two years ago.

Should we go ahead and sell the house at this new low price or should we try to keep on fixing things, and expect the market conditions to get better and sell it at a higher price in the future?

Answer: Your experience illustrates several important points.

First, real estate is a commodity. Prices do not always rise. While real estate values in most places and in most years have increased during the past decade, that is not the case everywhere.

Second, the definition of a "disappointing" offer is surely flexible -- today you might be elated to get an offer equal to the ones you rejected a few years ago. In real estate, as in baseball, you can't always get a home run. Sometimes you have to settle for less.

Third, it's impossible to know if market conditions will "get better." No one knows that the future will bring -- just think of all the bright Wall Street analysts who recommended Enron shares.

Fourth, it's possible to over-improve a home, to make it so much better than like homes that it's difficult to sell. Remember the old real estate rule: Buyers seek the least expensive home in the most expensive neighborhood they can afford.

Fifth, the fact that you've invested more in the property through improvements does not guarantee that the value will rise. You are a captive of local marketing conditions. If the market generally improves the value of your house will increase. If the market generally declines, it will be difficult to get a higher price. The tide that lifts all boats can also drag them down.

Before going further, why not speak with several local real estate brokers. Also, why not determine what you really want to do? Is it best to enjoy your home and stay where you are -- or is it better to take a loss now and move to a community that would offer more of the lifestyle benefits you seek? These are questions of both economics and personal preferences that only you can answer.


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Have a real estate question? Send your inquiry to Ask Realty Times. Because of the volume of mail received, Mr. Miller cannot respond to questions individually or privately. Published letters may be edited for space and style. For comments regarding other Realty Times articles, please contact individual authors by pressing here. For past columns, please press Ask Realty Times.
This column is designed to provide accurate and authoritative information in regard to the subject matter covered. It is made available with the understanding that neither the author nor the publisher is engaged in rendering legal, accounting, or other professional services. If legal services or other expert assistance is required, the services of a competent professional person should be sought.

Published: February 10, 2006
Realty Times
Full Story: http://realtytimes.com/rtcpages/20060210_askrt.htm

Renting earlier, renting longer
A mild winter and higher gas prices have helped seal Shore deals before the Presidents' Day rush.
By Jacqueline Urgo
Inquirer Staff Writer

OCEAN CITY, N.J. - Bill and Janet McGowan always like to be the early birds, beating the crowds who flock to the Jersey Shore on Presidents' Day weekend to find the perfect summer rental.

So on the Friday before the Super Bowl for the last 20 or so years, when everybody else's mind may have been on chips and dips and field goals, the Lower Makefield couple scouted rentals. And by game time Sunday, they usually had their summer perch picked out.

But not this year, as throngs of would-be summer renters beat the McGowans at their own game. Realtors say the number of properties already rented for the summer was 10 percent to 20 percent higher than a year ago.

"It was definitely harder to find exactly what we are looking for," said Janet McGowan, 52, who signed on the dotted line yesterday after deciding on a four-bedroom beachfront condo in Ocean City's south end. "It doesn't have everything we wanted, but we realized that if we wait too long, we may end up with something that isn't even close."

The McGowans are thinking of changing their plans next year.

"At first, we thought it was just us being picky, but then the agent mentioned that it's already been a busy rental season," Bill McGowan said. "Next year, we may get down here a lot earlier - as long as the Eagles aren't in the playoffs, that is."
A bad season for Philly's favorite football team and an unseasonably warm winter created the perfect conditions for a brisk rental season, said Steve Libro, rental manager at Berger Realty, where agents rented about 10,000 units last summer and expect to add 1,000 more this year.

Ocean City offers the largest concentration of rental properties in the Cape May-Atlantic-Ocean County region, with about 15,000 units clustered on the barrier island. Experts estimate as many as 60,000 rental units are available in the southern Shore region.

"People weren't watching football, the weather has been warm, and people are booking early," Libro said. "Our rentals are already up about 500 more than they were last year at this time."

When the weather is good, people make more of an effort to visit properties before deciding to rent, said Justin Aftanis, manager/broker at Cape May Realty.

"Which is a good thing, because usually when they see a property in person, they like it more and decide to rent for two weeks instead of just one," he said. "The trend is shifting back to people renting two weeks or more, when we had been seeing people cutting back for the past few years."

One reason, Aftanis and others said, may be the stability of rental prices, which can range from $500 a week for a two-bedroom apartment four blocks from the beach to $7,000 a week for a four-bedroom beachfront house.

"When prices stay the same or only slightly increase from year to year, people perceive they are getting more for their money and want to spend more time here," said Mary M. Helverson of Ferguson Deckart Realty in Avalon.

Many of her clients re-upped before leaving the island last summer, she said, while others have called back in the last few weeks to make sure they can get the same rentals this year.

"Some people almost see it as late if they wait until Presidents' weekend to get down here, so they are coming earlier and earlier," Helverson said.

Debbie Borden of Swedesboro and her teenage children made the rounds last week in Sea Isle City, with very specific requirements.

"We came down early this year because we need to get a house with at least two master suites because my parents always vacation with us, and everybody wants to have a nice, big bedroom when they are on vacation," Borden said. "So far, we aren't having any luck because everything that meets our needs is already booked."

Pat DeLeo, a rental agent at Prudential Zack Realtors on Long Beach Island, said rentals on the island were up 5 percent last summer, "and my numbers are definitely trending upward from that increase this year."

"I think high gas prices have a lot to do with it. People see gas prices staying high, so they aren't thinking about going to North Carolina or elsewhere. They want to stay closer to home, and they want to make sure they have that destination booked for the summer."

Tips for Finding the Perfect Place
Real estate professionals in Atlantic, Cape May and Ocean Counties offered these suggestions:

Show up. Make an appointment with a real estate agent, and search in person. The Internet is great for a preliminary search, Realtors say, but a computer cannot tell you whether you will smell the sea air - or fumes from a gas station.

Start early. It's never too early to start looking, even if it's while you are still on vacation. The sooner you start, the better the chance you will find what you're looking for.

Wear comfortable shoes. Don't take the first place you see. Plan to search an entire day, or even a weekend. Take your time at several properties, then weigh your options.

Be flexible.While you may have specific dates in mind, as well as the type of unit and its location, you may find a better deal if you are flexible on dates and locations.

- Jacqueline L. Urgo

In Atlantic City, luxury condo projects are in the works
BY SUZETTE PARMLEY
Knight Ridder Newspapers

ATLANTIC CITY, N.J. - The thought of living near where they worked appealed to the Pipers. So when the couple married last fall, they bought the two-bedroom apartment they had been renting at the Bella in the city's Southeast Inlet section.
"I love the location," said John Piper, 28, a restaurant chef at Harrah's casino hotel here, which is within easy walking distance to where he lives with his wife, Tina Pisano-Piper, 25, a local real estate agent.

The Pipers look like the people that show up in the TV commercials for the casinos - happy, young and looking for fun.

That they have chosen to buy a home in this city of about 40,500 is another sign that the billions of dollars spent on new casinos, housing and shopping over the last five years is having more than a cosmetic effect on Atlantic City.
And not a moment too soon as casino operators anxiously await the effect that the advent of slot-machine gambling at Pennsylvania racetracks this summer will have on their $5 billion industry.

While in Reno, Nev., the gambling business is contracting and former casino hotels are being converted into condominiums, the condo projects planned for Atlantic City tend to be new construction.

There are a half-dozen luxury condo high-rises in development in and around Atlantic City. Four are in the city's Inlet section, including a 34-story luxury high-rise with 303 units called Marbella.

"People have rediscovered Atlantic City and found it's not just a gaming town," said Jim Maggs, who is behind the project. "The attraction is that there is tremendous value in Atlantic City. It has something that Las Vegas does not have, which is a beach."

M&J Development L.L.C., based in Atlantic City, intends to break ground in the spring on a six-story, 179-unit high-rise called Melrose Place, in the nearby Northeast Inlet.

Builder Bruce Toll said he planned to build a luxury residential high-rise with 400 units, priced at $1 million and up, on the 50-yard line of the Boardwalk. Toll, of Horsham, bought the site of the former Trump's World's Fair casino for $25 million in September from Trump Entertainment Resorts Inc.

"The Borgata needs to be credited for showing how to access a whole different demographic, younger and more affluent," said Tom Scannapieco of the $1.1 billion Las Vegas-style mega-casino that made its debut in July 2003. "Clearly, the whole city is targeting that market."
Scannapieco was the original developer of the Bella, which was owned by Caesars Atlantic City casino for 15 years as a condominium rental property called the Regency. He bought the building last year to refurbish into luxury condos.
Advertised as "Atlantic City's first ultra-luxe condo," the 27-story Bella is cited by other developers as the project that ignited the current condo market. Its two-bedroom, two-bath units feature stainless steel appliances, Travertine stone floors, and imported Italian cabinetry. Scannapieco said about 55 percent of the 200 units had been sold. They start at $400,000 and can go to more than $1 million for penthouses.

The Southeast Inlet area is bordered by Atlantic and New Jersey Avenues, the ocean, and the Boardwalk. The Bella is a block and a half from the beach and Showboat casino. John and Tina Piper regularly walk to the new House of Blues at Showboat to see concerts.

Scannapieco said developers from New York, North Jersey and Florida were buying up land in the Southeast Inlet. He envisioned "shoulder-to-shoulder high-rises" there within five years.

"It will be the jewel, the Gold Coast of South Jersey," Scannapieco said. "There's a lot of developer activity that no one is aware of - projects that have not broken ground yet."

Maggs, who is based in Brielle, N.J., sees the same thing. He just recently purchased a 4 1/2-acre parcel in the area to develop into both high-rise and low-rise luxury condominiums.

"With other developers of national stature coming into Atlantic City, like Bruce Toll, it bodes well for Atlantic City's future," he said.

Brigantine kicks off beach replenishment
By MICHAEL PRITCHARDStaff Writer, (609) 272-7256
Press of Atlantic City
Published: Tuesday, February 7, 2006
Updated: Tuesday, February 7, 2006

With earthmovers and backhoes as a backdrop, U.S. Rep. Frank LoBiondo, R-2nd, and other dignitaries officially christened the city's $4.5 million beach-replenishment project Monday.

But with the ceremony being held on the same day that President Bush sent a proposed $2.77 trillion budget to Congress, LoBiondo knew that scaring up another $3 million (the federal share of the project) for another area of southern New Jersey beach won't be easy.

“It's getting harder and harder to convince my colleagues in Congress to fund these projects,” LoBiondo said. “It's a testament to the teamwork and dedication of everyone involved with this project that we are here today.”

Although Bush's budget includes funds for rebuilding the hurricane-ravaged Gulf Coast and dredging of shipping routes, the administration has never funded coastal beach-replenishment projects. That has fallen to Congress, which has showed support for the work.

“It started under the Clinton administration, which tried to leave no money for beach replenishment, and it's continued under this administration,” LoBiondo said. “Ultimately, the dollars needed for these projects are getting tougher to secure, and with the situation on the Gulf Coast, it's just that much harder. Fortunately, most of the replenishment projects in this area are already started and the commitments for maintenance are there.

“Of course that doesn't mean the funding is there, but with the project already started and the commitment made, the funding can be secured,” LoBiondo said. “But I'd hate to have a project right now that was still in the engineering phase and just starting. That funding will be much less secure.”

In fact, LoBiondo said that the Brigantine project came in just under the wire. Technically, money for the project was included in last year's federal budget, as the project was delayed about six months. Part of that delay was caused because the dredger being used for the project was tied up with other projects in Florida.

“Obviously we've had hurricanes before and we've still secured funding,” LoBiondo said. “But it is getting more challenging.”

Mayor Phil Guenther said that planning for the local project and securing the funds took nearly 10 years of work. But Guenther and LoBiondo said the benefits of such projects make the effort worth it.

“This project will protect homes and property as well as add to the economy of our state and region,” Guenther said.

LoBiondo on Monday also found out that Bush's budget proposal would cut about 500 National Guard positions in the state. The congressman said his office is still analyzing the proposal and whether it will affect the Air National Guard's 177th Fighter wing in Egg Harbor Township. But he cautioned that any proposal in the budget is still a long way from happening.

“President Bush's budget proposal is only the first step in the annual appropriations process,” he said. “As Congress moves ahead in examining all federal programs, my staff and I will be closely reviewing the president's requests for programs critical to southern New Jersey, including funding for the Coast Guard and homeland defense.”

Legislator says obtaining federal money for beach projects getting harder
By MICHAEL PRITCHARD Staff Writer, (609) 272-7256
Press of Atlantic City
Published: Tuesday, February 7, 2006
Updated: Tuesday, February 7, 2006

— With earthmovers and backhoes as a backdrop, U.S. Rep. Frank LoBiondo, R-2nd, and other dignitaries officially christened the city's $4.5 million beach-replenishment project Monday.

But with the ceremony being held on the same day that President Bush sent a proposed $2.77 trillion budget to Congress, LoBiondo knew that scaring up another $3 million (the federal share of the project) for another area of southern New Jersey beach won't be easy.

“It's getting harder and harder to convince my colleagues in Congress to fund these projects,” LoBiondo said. “It's a testament to the teamwork and dedication of everyone involved with this project that we are here today.”

Although Bush's budget includes funds for rebuilding the hurricane-ravaged Gulf Coast and dredging of shipping routes, the administration has never funded coastal beach-replenishment projects. That has fallen to Congress, which has showed support for the work.

“It started under the Clinton administration, which tried to leave no money for beach replenishment, and it's continued under this administration,” LoBiondo said. “Ultimately, the dollars needed for these projects are getting tougher to secure, and with the situation on the Gulf Coast, it's just that much harder. Fortunately, most of the replenishment projects in this area are already started and the commitments for maintenance are there.

“Of course, that doesn't mean the funding is there, but with the project already started and the commitment made, the funding can be secured,” LoBiondo said. “But I'd hate to have a project right now that was still in the engineering phase and just starting. That funding will be much less secure.”

In fact, LoBiondo said that the Brigantine project came in just under the wire. Technically, money for the project was included in last year's federal budget, as the project was delayed about six months. Part of that delay was caused because the dredger being used for the project was tied up with other projects in Florida.

“Obviously we've had hurricanes before and we've still secured funding,” LoBiondo said. “But it is getting more challenging.”

Mayor Phil Guenther said that planning for the local project and securing the funds took nearly 10 years of work. But Guenther and LoBiondo said the benefits of such projects make the effort worth it.

“This project will protect homes and property as well as add to the economy of our state and region,” Guenther said.

LoBiondo on Monday also found out that Bush's budget proposal would cut about 500 National Guard positions in the state. The congressman said his office is still analyzing the proposal and whether it will affect the Air National Guard's 177th Fighter wing in Egg Harbor Township. But he cautioned that any proposal in the budget is still a long way from happening.

“President Bush's budget proposal is only the first step in the annual appropriations process,” he said. “As Congress moves ahead in examining all federal programs, my staff and I will be closely reviewing the president's requests for programs critical to southern New Jersey, including funding for the Coast Guard and homeland defense.”

Jersey Shore Officials Get Jump On Beach Erosion

Robin Mackintosh
Reporting
Press of Atlantic City

(CBS 3) BRIGANTINE, NJ It’s the middle of winter, but elected officials in towns down the shore, are already looking ahead to summer. Beach erosion is a major problem this winter, and they’re taking action to have beaches ready for the summertime tourists.

There is lots of sand down the shore; the problem is making sure it is on the beach and not on the street. This month city officials are moving forward to make sure the beach is there this summer.

“We’ve had a series of winters where we’ve had small, but recurrent nor’easter, event, after event, after event” said Harry DeButts, Public Works Director Avalon.

Ocean City is also trying to reclaim there beach with geo-tubes. In Brigantine they are ready to start pumping sand back on to the beach with a use of a giant dredge.

“Beach replenishment is crucial to the economic benefits for this area, as well as protection of property,” said Brigantine Mayor Philip Guenther.

NJ Representative Frank Lobiondo helped kick off Monday’s $4.5 million month long beach replenishment project in Brigantine.

In Washington it’s harder than ever to get federal dollars with a tight economy.

“When my colleagues question me I tell them that if there is an earthquake in California or a hurricane in Florida we come to their rescue,” said Loboindo.

From Brigantine to North Wildwood, towns up and down the Jersey shore coast need rescuing.

Officials compare the beaches to the levies in New Orleans, one they’re gone the towns will be in danger.

(© MMVI, CBS Broadcasting Inc. All Rights Reserved.)

Affordable housing hard for towns to handle
By MEGGAN CLARKStaff Writer, (609) 272-7209
Press of Atlantic City
Published: Monday, February 6, 2006
Updated: Monday, February 6, 2006

— No one at a recent council meeting was particularly happy about the new land-use regulations the body was about to approve.

“We're going to start saying ‘no,' and it's coming from this seat,” Councilman Mark Hanko threatened, as the council grudgingly approved two ordinances intended to comply with both Council on Affordable Housing and Pinelands Commission regulations.

Across the state, municipal leaders are wrestling with the same dilemma: Whether to comply with the Council on Affordable Housing's next round of affordable-housing requirements, and if so, how.

Municipalities that choose to participate must tell COAH how they plan to create affordable housing COAH says they need between now and 2014. There's no penalty for not participating, but a COAH-certified plan protects the municipalities from developer lawsuits.

Compliance can be expensive. Many local leaders say it's too expensive, because of the burden affordable housing puts on schools and taxpayers. But lawsuits can be expensive, too.

Meanwhile, housing advocates are criticizing the new formula used to determine participating municipalities' affordable-housing need, saying it will create nowhere near enough housing.

“If you look at the census numbers … the situation is clearly getting worse,” said Paul Crystie, executive director of the Coalition for Affordable Housing and the Environment. “More people are paying more of their income for their housing, and part of the reason for that is that we don't have a housing strategy that is designed to produce affordable housing.”

Prior to December 2004, COAH used a different formula to calculate each municipality's housing obligation, taking into account a variety of factors such as how much affordable housing the municipality could have accommodated if it had had less restrictive zoning, the municipality's growth and whether it was located in an area where state regulators wanted growth.

Galloway Township, for example, was told that it had an affordable-housing obligation of 409 units, including 328 new homes and 81 home rehabilitations.

According to the state Department of Community Affairs, which oversees COAH, Galloway has built 183 units, plus 44 bedrooms in alternative living establishments, and has received credit for 44 more units in exchange for building rental housing as of 2004.

Galloway is certified, but the township still had to address COAH's new requirements last year — making sure one affordable-housing unit is built for each eight market-rate units and one affordable-housing unit is built for every 25 new jobs created by retail development through 2014.

To do this, the township has passed a variety of ordinances designed to pass the burden on to developers by requiring them to build some affordable housing. The township has also used ordinances to make it cheaper for developers to build by applying for zoning exemptions, if necessary.

Galloway is one of more than 200 municipalities in New Jersey that have opted to comply with COAH and build housing the low- and moderate-income families can afford. But many have not, for a variety of reasons — leaving them vulnerable to lawsuits by developers.

If a developer can prove that a municipality's zoning is so restrictive that people can't afford homes there — for example because it requires large lot sizes — then they can seek a “builder's remedy,” a court order to build housing that is not in compliance with zoning. The developer must build one affordable unit for every four market-rate units, but if he can make enough money from the market-rate units, the tradeoff can be an attractive one.

Hamilton Township is one of the area municipalities that opted not to comply with COAH. It's now trying to settle a builder's remedy lawsuit.

“From what I understand, because I wasn't involved in municipal government at the time, the township was advised by various professionals that we had adequate affordable housing and didn't need to go through the certification process,” Mayor Tom Palmentieri said. “We find currently, now, that that advice and recommendation was inaccurate.”

Municipalities that are attractive to developers tend to have large open tracts of land, are experiencing population growth and were relatively near desirable urban centers.

Egg Harbor City, on the other hand, has had almost no growth for decades and has only recently attracted the attention of developers. The city also failed to seek COAH certification, but thus far has not felt any repercussions.

“In Egg Harbor City, we haven't had any (development) so it really hasn't come up, but it will come up when the development starts,” Mayor Joseph Kuehner said. He said the city will probably soon pass the necessary ordinances and petition COAH for certification.

If leaders of fast-growing municipalities like Galloway dislike COAH because affordable housing produces costly school children and little tax revenue, affordable-housing advocates criticize COAH for not doing enough.

They point out that COAH has no power to force municipalities to build the affordable housing they're obligated to build, and relies on developers to sue them if they don't comply. They say COAH offers too many loopholes — such as affordable housing credits if a wealthy municipality pays to rehabilitate homes in a poorer one.

“(If a municipality is certified), it means they have a plan,” Crystie says. “It doesn't necessarily mean it was good and it doesn't mean the housing got built.”

And, critics say, COAH vastly underestimates the real need for affordable housing in New Jersey. COAH's plan for the third round of affordable housing — to be built through 2014 — would create about 77,000 units, according to the Coalition for Affordable Housing and the Environment. The commission estimates the real need is approximately 650,000 units.

The new rules “won't be a good thing for people trying to find housing,” says Dianne Brake, president of the Regional Planning Partnership in Trenton. Brake, who helped draft the prior COAH rules, says the new rules don't make senses and won't create affordable housing where it's needed.

“Who is connecting the kind of new jobs, the growth of jobs, the future of jobs and what housing do people who have those kind of incomes need?” she said. “Nobody looks at that, least of all COAH.”

She said people who work in New Jersey will end up living in Pennsylvania if the state doesn't meet their housing needs, leading to the eventual exodus of jobs as well.

“I believe that New Jersey should have a general housing policy, not an affordable housing policy,” she said. “It's not rocket science. It's politically difficult.”

She noted that some municipalities believe creating affordable housing would be so expensive they'd rather take their chances on a lawsuit. West Windsor in Mercer County fought a developer lawsuit all the way to the Supreme Court, she said — and lost.

“I would argue that doing the right thing is the best way,” she said.

But Michael Cerra, a senior legislative analyst with the League of Municipalities, said COAH compliance “is time consuming, and it can be cost-prohibitive.”

He argues that the new requirements are better than the old ones because they make more sense.

“There is a direct link between the amount of housing that is built and the amount that has to be affordable,” he said. “To call it a failure already … that's the cart before the horse, to say the least.”

As onerous as some leaders view affordable housing requirements, there's at least one who believes having affordable housing is good for his town. Brake lauded Plainsboro, Middlesex County, Mayor Peter Cantu for building 126 units of affordable housing, located throughout the community, without prodding from the state. Plainsboro has remained certified by COAH and has not been sued by developers.

“I think it's an issue of whether you believe in affordable housing or not. We certainly do here,” Cantu said. “We began on the premise that you have a responsibility to provide a balanced housing opportunity … It's worked. Clearly, it's worked.”

N.J. town stirs debate over right to seize homes
By ROBERT TANNERAssociated Press
Press of Atlantic City
Published: Monday, February 6, 2006
Updated: Monday, February 6, 2006

— The city wants Anna DeFaria's home, and if she doesn't sell willingly, officials are going to take it from the 80-year-old retired preschool teacher.

In place of her “tiny slip of a bungalow” — and two dozen other weathered, working-class beachfront homes — city officials want private developers to build upscale townhouses.

Is this the work of a cruel government? Or the best hope for resurrecting an ocean resort town that is finally showing signs of revival after decades of hard times?

Echoes of the debate are happening across the country, after a U.S. Supreme Court decision brought new attention to governments' ability to seize property through the tool of eminent domain. About 40 states are re-examining their laws — with action in Congress, too — after the court's unpopular ruling.

“We thought this was going to be our home forever,” said DeFaria, sitting in a cozy kitchen with photos of children and grandchildren, quotes from the Bible and a game of Scrabble that she plays against herself. “Now they want to take it away. It's unfair, it's criminal, it's unconstitutional.”

Not according to the Supreme Court. In a 5-4 ruling last June that was greeted with widespread criticism, the court found that New London, Conn., had the authority to take homes for a private development project.

The Constitution says governments cannot take private property for public use without “just compensation.” Governments have traditionally used eminent domain to build public projects such as roads, reservoirs and parks. But for decades, the court has been expanding the definition of public use, allowing cities to employ eminent domain to eliminate blight.

The high court, in its ruling, also noted that states are free to ban that practice — and legislators around the country are thinking about whether they should do just that.

New Jersey state Sen. Diane Allen, R-Burlington, Camden, with bipartisan support, is pushing for a two-year ban on all eminent domain actions and for a bipartisan study group to re-examine its use in New Jersey.

“Right now government, I think, is using eminent domain to take people's private properties and hand it over to another owner,” Allen said . “It's really putting a hole in the American dream. Ownership of private property plays such a large role in that dream.”

After the court ruling, four states passed laws reining in eminent domain. About 40 others are considering legislation. In Congress, the House voted to deny federal funds to any project that used eminent domain to benefit a private development, and a federal study aims to examine how widely it is used.

The Washington-based Institute for Justice, a libertarian advocacy group that worked for homeowners in the New London case and in Long Branch, argues that state laws should be changed so property can only be seized for public uses like a park or a school — not urban redevelopment that benefits private developers.

Redevelopment usually depends on defining an area as “blighted” or a “slum,” though definitions are vague, said Bert Gall, an attorney with the institute. Criteria can include a building's age, lack of compliance with building codes, even the size of a yard.

Abuses are widespread, Gall said, claiming that over a five-year period ending in 2002, more than 10,000 properties were threatened by eminent domain.

Municipal leaders across the country are pushing back, arguing that it's false to claim eminent domain is widely abused and warning that an emotional backlash to the court ruling is putting at risk an important tool that has helped turn around neighborhoods including Baltimore's Inner Harbor and New York's Times Square.

Elected officials have difficult decisions to make, and often must balance a community's needs with a few individuals, said Don Borut, executive director of the National League of Cities.

The plight of homeowners is hard to ignore, he said. “But at the same time ... there are hundreds if not a couple of thousand faces of people you don't see, of people of all levels of income who as a result of the economic development will get jobs,” he added.

In Long Branch, there's no doubt the city needed to do something — a comeback wasn't happening on its own, Mayor Adam Schneider said.

“Most people wouldn't walk down those streets anymore. The worst neighborhood in our city was along our oceanfront. And that's been reversed,” he said. Since the redevelopment effort began in earnest in 2002 after a decade of planning, new shops and homeowners have moved in, and new sidewalks have been installed — along with a new boardwalk, parks and an ice-skating rink, he said.

“What you do is you've improved your city, you've gotten rid of decrepit housing, you've created jobs,” Schneider said. “It's easy to play it out as the city is cruel and government is stealing your property. I'm used to it. ... But this has reversed the decline that's been going on in Long Branch for more than 50 years.”

Already, people are coming to new shops along the central waterfront, where the old pier burned down back in 1987. Rows and rows of new, sand-colored condominiums shadow DeFaria's one-story home when the afternoon sun sinks low.

DeFaria said she was offered $325,000 for the home she and her late husband bought in 1960 for $6,400. Where could anyone buy a waterfront view on the Jersey coast for that amount of money now?

But it's not the money, she said: $1 million wouldn't convince her. “They're taking my home away — not my house. My home. My life.”

Hamilton tries to balance quiet past and developing future
By MADELAINE VITALEStaff Writer, (609) 272-7218
Published: Sunday, February 5, 2006
Updated: Sunday, February 5, 2006

Elmer Ripley is a lifelong resident who continues to see change in the ever-growing municipality.

When it comes to growth and strip mall after strip
mall on the Black Horse Pike, Ripley has one word for his feeling about his home town: “Decimated.”

It's not that he opposes growth, but there's a right and wrong way to do it, he said.

“When I was a boy, Mays Landing was a community of 3,500 people. There were hardly any homes at all. You could leave Mays Landing and go to Pleasantville in the early '30s and see 20 to 25 houses from here to Pleasantville,” Ripley said. “That has all changed.”

At times, the town historian feels the township is being forced to grow more than it should. It is a Pinelands Regional Growth Area, which means certain areas, such as the Route 40 corridor, are destined to grow whether residents and officials want it or not, he said.

Now the township has 25,000 residents, and with more developments approved, it is sure to get even more populous. Plans for new shopping plazas also keep coming: The Gateway plan was approved for a more than 100,000-square-foot shopping center to be located at the corner of the Black Horse Pike and Cologne Avenue. Work could begin this year.

A 250,000-square-foot retail store also is planned for across the Black Horse Pike from the Hamilton Commons. It is still in the review stage. “I guess I feel that the state of New Jersey — specifically the Pinelands Commission — has rammed growth down our throats. I feel that we are in a position where we can't even control our own destiny,” Ripley said.

But Ripley, who along with his wife raised three sons and three daughters, continues to love the community.

He and other residents and merchants get involved, aiming to fight some changes and accepting those they must, to stay in a place they call home.

Ripley and John Kurtz, a resident and owner of County Seat Florist in downtown Mays Landing, sit on the Main Street Task Force, a group of residents and business owners concerned with preserving and revitalizing the historic downtown.

The group of residents, merchants and officials are working to make the downtown more attractive to shoppers and to maintain a beautiful area.

“We are hoping through grant money things might change. The county will give $1 million toward the revitalization of Main Street. It is a program we would hope for to bring back some of the businesses that were there,” Ripley said.

Kurtz, who is also the president of the Mays Landing Merchants Association, said he sees things as a resident and a business owner. Sometimes the two conflict.

“Obviously, as just a resident you want to get around because you are always worried about redevelopment and traffic,” he said. “We are interested mainly in turning the historic Main Street here into a destination. We want people to come here and see what makes it so special. We have beautiful parks and the lake on one side and the head of the river on the other. Then you go down Main Street you have Lake Lenape.”

Kurtz said merchants want people to visit them and see the attraction of a beautiful area.

“People go to the malls and the shopping areas, but we would like to give them a wakeup call that this little gem is sitting here and we'd like to give them a look,” he said.

But even he and Ripley admit it is difficult to draw motorists from the bustle of the stores along the Black Horse Pike.

Mayor Thomas Palmentieri said the township is doing everything it can to continue to grow while working with the state Department of Transportation on ways to ease traffic and improve the downtown area.

“It is important for residents and others to remember, the growth that at times might appear to be excessive is a result of the mandates by the Pinelands Commission,” Palmentieri said. “As a township, we are always attempting to minimize the amount of mandated growth.”

The township has done that. It fought the development of 8,500 units and won.

Community and Economic Director Phillip Sartorio said township leaders want to maintain the aesthetic qualities of the community, which varies from Lake Lenape, to countryside in Laureldale and Weymouth, to bustling shopping areas.

Being a designated growth area, officials admit, mean s they often hear complaints about the landscape of the once rural community.

“We hear too many trees are cut down,” Sartorio said. “Then there is the volume of traffic. These are the typical complaints that people naturally have.”

Officials respond that such problems are due to the growth designation, and say they pick their development approvals wisely to maintain a good quality of life for residents.

“We have done our best to try and balance our commercial and residential growth,” Sartorio said. “We have always had planners and the developers meet and review projects. Our planning board officials are very clear about what they find acceptable. The board has sent plans back for changes many times.”

Ripley's family name goes back many years in Mays Landing. He says he cannot even think of relocating.

Sometimes he gets into his 20-foot fishing boat and throws in a line.

“A whole world is out there waiting for me to travel,” Ripley said, looking out at the water. “I could get in my boat and travel, but the waterways are becoming congested too. I think I'll just stay here and leave the boat just for fishing.

The Washington Post
01-21-2006

REAL ESTATE MAILBAG
Byline: Robert J. Bruss
Edition: FINAL
Section: Real Estate

QDEAR BOB: My mom transferred the deed on her house into my name a couple of years ago. After she passes away and I sell the house, what kind of taxes should I nticipate? -- Donna B.

ADEAR DONNA: When your mom gave the house to you, you took over her presumably low adjusted-cost basis. Her basis was the purchase price, plus closing costs that were not tax deductible at that time, plus the cost of any capital improvements she added.

If you added capital improvements after you became the legal owner, those costs will increase the adjusted-cost basis you took over from your mother.

Or, perhaps, your mother acquired title by inheritance. If so, she received a "stepped-up basis" to market value on the date of the decedent's death. That would be your adjusted-cost basis, plus improvement costs.

While your mother is still alive, it is important for you to determine her adjusted-cost basis when she deeded the house to you. That basis becomes your basis, plus any capital improvements you added.

The difference between your adjusted-cost basis and the net sales price is your taxable capital gain.

Unless the home is your principal residence for at least 24 of the 60 months before its sale (so you can qualify for up to $250,000 tax-free home sale profit), your capital gain will be taxed at the 15 percent federal tax rate, plus applicable state tax. For full details, consult a tax adviser.

DEAR BOB: I am renovating a property with the intent to resell at a profit. I want to either do a Starker tax-deferred exchange, or if I hold it long enough to qualify for a long-term capital gain, to sell it and pay the 15 percent federal tax rate. A real estate developer I talked with says he starts the 12-month long-term capital gain holding period on the date he signs the purchase contract. This makes a big difference to me. I tried to close the purchase last May, but the seller pushed off the closing until August. -- Blair D.

DEAR BLAIR: To qualify for the federal long-term capital gains tax rate, currently a 15 percent maximum, the IRS says you must hold title at least 12 months.

However, an exception occurs if you acquired "equitable title" before taking "legal title" by deed.

An example of owning equitable title, but not legal title, occurs for the thousands of property buyers who are purchasing under a land contract for deed, often called an installment land contract. Then the date of signing the agreement starts the running of the 12-month capital gains holding period.

However, that doesn't appear to be your situation. Your developer friend is mistaken.

The holding period does not begin at the signing of the sales contract unless there is evidence of also transferring equitable title, including the benefits and burdens of ownership at that time. For full details, consult a tax adviser.

DEAR BOB: If I buy a house at a foreclosure sale auction, and if that house has an IRS tax lien, will that tax lien drop off only if the taxpayer or I pay the lien amount? Or, will the lien drop off automatically after the property changes ownership? -- Greg O.

DEAR GREG: If you are the successful high bidder at the foreclosure auction, you will receive title "subject to" the recorded IRS tax lien. If the lien was recorded before the loan that is being foreclosed (highly unlikely), you become obligated to pay that tax lien or the IRS can wipe you out by foreclosing on its tax lien.

More likely, the IRS tax lien is "junior" to the mortgage being foreclosed. In this situation, if the IRS was given proper advance notice of the sale by the foreclosing lender, the IRS then has an automatic 120-day redemption period after the sale.

That means the IRS then has up to 120 days to pay the successful high bidder the amount paid at the foreclosure sale, plus any "necessary expenses" such as payment of any other superior liens or the fire insurance bill.

For this reason, if you are the successful high bidder at the foreclosure sale, don't pay any nonessential expenses until the IRS 120-day redemption period expires. To illustrate, if you spend $5,000 fixing up the property before the IRS exercises its redemption right, the IRS won't reimburse you the unnecessary $5,000.

DEAR BOB: I am selling my home and buying another home through the same real estate agent. He asked me to pay a full 6 percent sales commission for selling my home. Is that fair? Shouldn't I get a discount since he is my agent for both selling and buying? -- Nanda P.

DEAR NANDA: As famous negotiator Herb Cohen says in the title of his great book, "Everything is negotiable." That rule is especially true in real estate sales.

If your real estate agent is smart, he will offer you a strong incentive to stick with him when you buy your next home. But be sure to get your commission adjustment agreement in writing so there is no misunderstanding.

The easiest place to negotiate the sales commission is on the sale of your home because the seller usually pays the commission. However, your sales agent could offer you a rebate on your home purchase.

But the states of Alaska, Kentucky, Louisiana, Mississippi, Missouri, New Jersey, North Dakota, Oklahoma, Oregon, South Carolina, Tennessee and West Virginia prohibit paying realty sales commission rebates to unlicensed buyers.

DEAR BOB: I am interested in attending a forthcoming real estate auction. But why would someone auction off their home instead of putting it on the market for sale with a real estate agent?

-- Angela N.

DEAR ANGELA: By law, some properties can only be sold at a public auction, such as mortgage and deed-of-trust foreclosure sales, property tax lien sales, IRS tax lien sales and judgment lien sales. The exact procedures for each type of auction sale vary by the type of sale and the state where the property is located.

If a forced sale is not involved, professional real estate auctioneers argue they can get a higher price than can a real estate agent listing a home in the "normal" way.

Auctions are often used where many properties of similar type are to be sold, such as a development of unsold condos or townhouses. The best auctioneers reate "auction fever" to obtain high prices, often by providing easy financing for buyers.

Personally, I think auctioning a single-family house cheapens it, creates a distress market mentality, and limits the number of prospective buyers. As a property buyer, I prefer to negotiate with the seller rather than compete with other bidders.

However, if I were a home seller and the local market was weak, I would consider an auction to get rid of my house at a reasonable net sales price. If you bid at a real estate auction, carefully read the rules because you may become obligated to pay the auctioneer's fee if you are the successful high bidder.

DEAR BOB: My ex-wife and I obtained a "friendly divorce" about four years ago. She got the house. That's fine with me because she also got the credit card bills that she has paid in full. But she refuses to refinance the 7.25 percent mortgage, which shows up on my credit report. Fortunately, she pays on time, but I recently remarried and want to buy a house with my new wife. I can't, however, qualify for another mortgage because the old mortgage still shows up on my credit report. What can I do? -- Ted W.

DEAR TED: Unfortunately, there is nothing you can do to force your ex-wife to refinance the mortgage on the house. This is a very common situation in divorces. Your divorce lawyer should have discussed it with you and your ex-wife. But now it's too late.

However, I understand some lenders will approve a home mortgage in your situation if you fully explain. Working with an experienced mortgage broker could be very productive.

DEAR BOB: I bought my first house in 2005. My partner lives in it with me, but the mortgage and title are in my name alone because I have better credit. My partner gives me money each month to go toward paying the mortgage. Is this considered rent and therefore taxable?
-- Clarissa P.

DEAR CLARISSA: From your description of the situation, it appears the money you receive from your partner is rent that you should report on Schedule E of your income tax return.

Because the house is in your name alone, and you are not married to your partner, you are then entitled to depreciate part of the house rented to your partner. Also, you can deduct part of applicable expenses such as part of the insurance and household repairs on Schedule E.

DEAR BOB: My friend was added to the title of his parents' house deed at their request. They wanted the house to remain in the immediate family. This was done shortly after his mother passed away. Several years later, his father created a revocable living trust and converted his half of the ownership to tenant-in-common with his son. Now the father has filed a quiet title lawsuit, alleging he did not understand he was signing away half of his home. My friend is aware someone is influencing his father to gain control of the house, probably the granddaughter who is named as successor trustee of the living trust. What are chances of my friend prevailing in court? -- Elva M.

DEAR ELVA: Unless the father was mentally incompetent or under duress at the time of deeding half of the house to his son, if the deed was properly executed, the chances of "undoing" it are not good for the father.

However, the father did have the legal right to put title to his half of the house into a revocable living trust, thus creating a tenancy-in-common with his son. A quiet title lawsuit will determine the property rights of each co-owner. The son should retain a local real estate lawyer.

DEAR BOB: In your recent article about an alleged encroachment, the writer of the letter was apparently "told" his fence encroached on the property line. Who told him? While we cherish the right to have opinions on almost any subject, only a licensed land surveyor can determine the exact boundary. In my land-surveying business, I find only about 10 percent of the time when people claim an encroachment are they able to show documentation of a survey by a licensed surveyor. Without such documentation, I would not recommend a home owner spend much time or money on the dispute. -- Lewis S.

DEAR LEWIS: Thank you for your expert opinion, with which I fully agree. Adjoining property owners often are reluctant to spend a few hundred, or even a few thousand, dollars to hire a licensed surveyor to determine the exact boundary.

However, and perhaps you have seen a similar situation, I recall one circumstance where two disputing neighbors had two surveys prepared by licensed surveyors that showed a boundary difference of almost 18 inches. There was a very steep rocky slope and the starting point of the survey was unclear. The difference was really unimportant because neither neighbor could use the disputed area, yet they refused to resolve their dispute.

DEAR BOB: When my wife and I bought our home in 1972, we obtained an owner's title insurance policy from First American Title Insurance Co. We kept the policy in our "little drawer" in the desk, where we keep other valuables including our deed, wills, insurance policies, photos, etc. Has this title insurance policy expired? How long should we keep that policy?
-- Erwin H.

DEAR ERWIN: Owner's title insurance policies are in effect as long as the property buyer or his heirs own the property. Your policy is still valid in case an insured title problem arises. Keep that policy as long as you own the property. It will even protect your heirs from title risks.

Just a few days ago, I received an e-mail from a home owner who was having a title problem. I suggested she contact her title insurer. Unfortunately, she couldn't find her deed, title insurance, or any other evidence she owns the property. She couldn't even remember what title company insured her title.

Interestingly, many title insurance companies have merged with other title insurers. Fortunately, your title policy from First American Title Insurance Co. is with one of the oldest and best title insurers. Homeowners with title policies from insurers that are no longer around should contact their state insurance commissioner to determine what title insurer took over the defunct title insurer's obligations.

DEAR BOB: Years ago, I leased a vacant building with the owner's written agreement that I would pay all the expenses, such as property taxes, fire insurance, repairs, etc. There was no mortgage, as far as I know. I have been paying the costs for at least 25 years, but I make no actual rent payment to the property owner, who I understand has been dead for at least 10 years. Nobody bothers me and I operate my busy motorcycle repair business very happily. A few years ago, I put on a new roof at my expense. Other than that, my expenses have been far less than rent would be. But recently the city has been bugging me in a nice way about bringing the building up to code. It would cost at least $20,000. You had a recent item that said when a person pays the property taxes on another person's property for a number of years, and occupies that property, he could acquire title by adverse possession. Would that apply in my situation?
-- Otto W.

DEAR OTTO: The major reason why you probably are not entitled to title by adverse possession is that you entered into possession as a tenant. Adverse possession requires "open, notorious, and hostile use," plus payment of property taxes, for the required number of years. That rule clearly disqualifies tenants.

Your legal problem is that your use is not "hostile." It was originally permissive. However, if you are sure the owner died about 10 years ago, your use might have become hostile as to his heirs.

Please consult a local real estate lawyer to discuss your situation. The solution could be to bring a quiet title lawsuit to determine who now owns the property you occupy.

DEAR BOB: About a year ago, I sold my commercial building. The buyer, represented by an experienced real estate agent, made me an unsolicited purchase offer I couldn't refuse. The building is leased to an AAA-rated tenant. The all-cash sale closed within 60 days with no problems and no inspections. However, recently the buyer says the electrical wiring is not up to code and I should have disclosed this to him. He threatens to sue me. I think the real problem is that the tenant's lease expires in a few months and the company will be moving. I didn't know the wiring isn't up to code and will cost thousands of dollars to rewire for a new tenant. Do I have any liability to the buyer? -- Frank W.

DEAR FRANK: The law in most states for the sale of commercial property is "caveat emptor," or let the buyer beware. Commercial property buyers should know, especially when being advised by an experienced real estate agent, that they must perform due diligence inspections of a commercial property before purchase.

Anyone can sue anyone, but there are "malicious prosecution" penalties for a plaintiff bringing a groundless lawsuit that lacks merit. Unless you misrepresented the property, such as by concealing its defects, the plaintiff would probably lose such a lawsuit against you.

If you are sued, you should hire a real estate lawyer, win the case, and then sue the plaintiff for malicious prosecution damages.

DEAR BOB: Last year, in a freak hailstorm, the vinyl siding on some of the townhouses in our complex was severely damaged. The condominium homeowners insurance policy paid up to its maximum limit, but that wasn't enough. The association then assessed each owner of the other undamaged units $2,400 each. Yet we have more than $175,000 in our reserve funds that should pay for extraordinary expenses like this. The association directors say (1) they already took $100,000 from reserves, and (2) if they take the additional needed funds from the reserves, that would leave us without adequate reserves for emergencies. Can a homeowners association assess undamaged unit owners in this situation? -- Inez D.

DEAR INEZ: Presuming the special assessment doesn't violate the home owner aasociation conditions, covenants and restrictions (CC&Rs) or the by-laws, after the vote of the board of directors it appears they had the legal right to levy the $2,400 assessment on each owner.

I realize it seems unfair to assess the undamaged unit owners, especially when there are reserve funds that could be used to pay the additional costs. That's why you elect a board of directors -- to make difficult decisions.

DEAR BOB: My bank had a sign in its lobby offering reverse mortgage loans to senior citizen homeowners. I contacted the recommended agent, but she only offers the FHA reverse mortgage. My home is worth at least $750,000, so I asked her about the Financial Freedom Plan, which you say has higher limits. She had never heard of it. Where can I find out information? -- Sarah H.

DEAR SARAH: On the Internet, just go to www.reversemortgage.org and click on your state to find qualified representatives offering all three types of reverse mortgages. If you don't have a computer, just go to your public library reference department and they will assist you.

DEAR BOB: I am 82 and depend on my two adult children to take care of me in my farm home, where I enjoy living alone. They live nearby and take me grocery shopping, to doctor appointments, to church and wherever I need to go without ever complaining. I think we get along great, and I am very happy. About two years ago, I deeded my farm to them in equal shares. The farm is leased to a neighbor farmer, who has leased it for about 20 years. He pays the rent to my children and they send it to me. The problem is this tenant farmer now wants to buy my farm. He made me a very generous
offer. I told him I no longer own they farm and he must deal with my children. They refuse to sell. I think they should grab this generous offer. What can I do?
-- Alice R.

DEAR ALICE: Unfortunately, there is nothing you can do because you no longer own the farm. Your situation shows why generous parents should resist the urge to deed property to their adult children, even when they are the greatest kids on earth.

Readers with questions should write Robert J. Bruss at 251 Park Road, Burlingame, Calif. 94010, or contact him via his Web page, www.bobbruss.com.

© 2006, Inman News Service
Copyright 2006, The Washington Post. All Rights Reserved