On this regional public affairs program, Mark Korell of the Minnesota Housing Finance Agency and Saint Paul developer Ron Soderberg discuss money for housing and tips on renovation, and answer listener calls.
Read the Text Transcription of the Audio.
Building a new home is a very expensive proposition through these days and so is fixing an old home to make it livable. The average purchase price of a home in Minneapolis is in the range of $50,000. And if you're trying to beat that caused by purchasing an old home that needs work, you must often be prepared to spend thousands even tens of thousands of dollars to repair we have is our guest today in the studio to people who know a lot about where to get money for homes. And also how to repair them Mark Correll is with the Minnesota Housing Finance Agency and he will be with us a bit later in today's program. We also have with us Ron Soderbergh a private developer and contractor whose business is Rehabilitation. He works in the Twin Cities and he lives in st. Paul during his eight years in business. She has rehabilitated close to 100 Holmes and his firm also does new construction was I mentioned a bit later. We'll be talking about some sources of State money for home RI.Dilatation and the building of new homes as well. But first we want a quiz run Soderberg on some of the pitfalls of Rehabilitation of homes. And as we mentioned Bronte some people are interested in getting out of the rut of I thinking of new homes and are more interested now and looking at the existing stock of Housing and determining whether or not it's feasible for them to become involved in the and sort of the ultimate do-it-yourself operation I suppose and that's the repair Rehabilitation of an older home. I wanted to ask you first of all, do you think it's wise or safe for the average home buyer to even consider buying a home that is in poor repair with the intent of fixing it up.Well certainly down there is it's wise it's wise simply in terms of economics the reason for the for rehabilitation and the new entrance and Rehabilitation is because Rehabilitation provides housing at electric cost new construction. So certainly there is more than ample reason to justify rehabilitation in terms of individuals. You've got to consider individual capabilities the least of which is financing capability and any mechanical aptitude that one might possess.In indeed individuals can rehabilitate their own homes. They can act as your own General Contractors doing some of the Performing some of their own work as a Sweat Equity to provide their housing at a lower cost. but that does depend on those individual considerations and Now you bring up a very important point that I wanted to stop you at there. And that's the issue of mechanical aptitude and you also mentioned dealing with General Contractors. And that's a part that many of us may not associate with rehabilitating an older home. We think that all we have to do is go out and buy the tool kit with hammer and saw and some nails and begin taking care of it. What are some of the problems associated with approaching General Contractors? Because certainly some of the rehabilitation work does have to be done professionally. Is that right? Well, that is correct Rehabilitation courses, very complicated. It's also a new industry is its information and and knowledge that is not possessed by most new Builders. It is information and knowledge that is not possessed by most homeowners. The pitfalls are the unknown factors of an existing house what happens when you uncover a wall and open up the part of it is so structure. That that has to be dealt with by the homeowner and it's a particular problem in dealing with contractors. If the contractor is not familiar with existing housing the bidding process and work scheduling can be very badly estimated neskowin can cause of course great deal of frustration, if not financial difficulty for the contractor and the homeowner. It's important than to have a contractor that is knowledgeable with existing housing and have a contractor that is knowledgeable with the restructuring of existing housing. Do you think it's reasonable run to for the home buyer to assume that he or she can save money by buying an older home in trying to renovate it or should they simply plan on spending a lot of money to bring that home into the shape? They wanted in I think it's reasonable to assume that they can save money. They can't save money with great deal. Concentrated effort at saving money. It's not a simple process. B to have a general contractor perform. All of the work is clearly the most cost-efficient method for most homeowners with the least debt with the least effort. If of course they have a qualified contractor. Now, is there a way of targeting a figure that a person can expect to pay for renovating a home? In other words? Is there an average price that a person could expect to pay in terms of repairs and Rehabilitation for a home that might be in poor repair. Basically we have been able to document that Rehabilitation can provide housing for 30 to 50% less than the cost of new construction. So when you quoted earlier the average cost of a new home in in St. Paul and Minneapolis at $50,000. We expect that we can provide a rehabilitated house equivalent to new construction for 30 to 50% less than that. The frequent Pitfall is that the consumer and now purchasing an existing home for rehabilitation Sims that they can do that Rehabilitation for far less than 50% and they aren't Paired for those expenditures we feel however the 30 to 50% less than the cost of new construction is more than ample reason and justification for doing Rehabilitation. Now, let's talk for a minute about some of those little adventures that the new homeowner can discover when they purchased a home that needs some substantial Rehabilitation you mention for example, uncovering a wall or discovering some other major defects in a home or a major items that need help. Let's take a foundation. For example how serious should have foundation problem be before a person of before a person should decide they would not have anything to do with it and she call in a contractor for example Well, basically any individual should not be dealing with a structure that does not have complete Integrity in that. In fact, they should not be dealing an unskilled individual should not be dealing with the house that does not have a complete solid foundation. Or that does not a structure that does not have a complete solid framing Integrity. For instance one that's on outer framing a structural wall has been damaged by fire should not be done by an individual require a structural rebuilding and that should not be done by an individual basically a homeowners and those so industrious homeowners should be looking at buildings that have solid foundation solid framing members and good structural basis so that they can in fact make some mistakes and their process without affecting the Integrity of the structure. They will in fact make some mistakes. We expecting if I can draw back to the process of Rehabilitation. The reason we should be saving housing and the reason anybody should be looking at Rehabilitation is Affordable option is to have a complete home as structurally sound as substantial as new construction. Do in order to do that. We must replace the essence of the structure. We must have new mechanical systems. So they should be after structural systems are second consideration should be mechanical systems destruction should have new wiring new Plumbing on new heating system frequently. There's degrees deterioration of those systems and frequently, we can adjust a rehabilitation program or homeowner can adjust that program to the degree of deterioration of the systems Plumbing may be allowed to be may be allowed to remain in the structure if it's expected to have an additional 15 to 20 year life on that system. It may be found. However that once those walls are open that a lot of unexpected problems have happened with plumbing plumbing and water pressure might be fine. When it comes out of the faucet in a dwelling on the one you open up the volume a find that there's been each pipe has been wrapped in Band-Aids which has happened and Gauze and cloths and rags and vent pipes have been disconnected twice pipes are glued together with any number of makeshift remedies and then we end up replacing those systems. The danger is it is it is not anticipating replacement. We categorically anticipate replacement of mechanical systems in our Rehabilitation how we feel that it's essential not only in class consideration, but in the all the prime consideration of extending the life expectancy of a piece of property, Is there a asset age at which our home is beyond repair a home built at the turn of the century for example, 1900 door any set age at which a person should simply not consider touching that home. I know I don't believe it has anything to do with age down. There is a degree of deterioration and that affects that consideration one of the surprising facts. I think two most people in the course to most of the listeners is that there are very few homes that cannot be rehabilitated economic and economically in relation to new construction and I have to qualify that because we are now dealing with housing on a square footage basis not on a personal desire level but strictly as a commodity and strictly in terms of physical dollars in economics. One of our interesting experiences has been the Milwaukee Avenue restoration and Minnie. Plus it's a four square block Redevelopment sponsored by the sword West Community. If there ever was housing that could ostensibly not be rehabilitated. It was Milwaukee Avenue housing. It was housing that had no foundations simply small sister and under the center of a house because of the lack of foundation the brick veneer on the houses had started to slide off the house since the 1870s when it was originally built because of that shifting of the house the roof Rafters had snapped across the entire roof, and the house has had many time shifted over a foot and a half out of plumb. However, we have rehabilitated it today. It stands as some of the finest restored housing in the country in my opinion and it was rehabilitated for approximately $26 a square foot taking a new construction replacement cost of $40 a square foot. I think that says quite a bit about what we can do in rehabilitation. How have you found lending institutions reacting to this Prospect of Rehabilitation of older homes run are they using their stand somewhat? Because I am under the impression that they do not view very sympathetically an average potential homeowner approaching them with the prospect G. I have a beautiful older home in such and such a neighborhood that I'd like to buy end and really spend a lot of money fixing it up. Just right there. Once you give me some money what have you found is the reaction as a zealous contractor and as many cell has homeowners who are involved in this Rehabilitation process and it clearly is an exciting process in a rewarding process. I think we've all felt times that it's the bankers lending institutions who have held us back. I think in all fairness to The Lending institutions, we have to consider their fiduciary responsibilities and that includes justifying appraised new appraisals for piece of property in an inner-city Community instant. How do we justify appraising a rehabilitated home at $60,000 when it's surrounded by deteriorated properties selling for $20,000. How do we justify? How do we justify asking A lender to put out their cash and hold it in their portfolio when perhaps their financial practices are to sell that paper and get it out of their portfolio. How do we ask him to do that when they could just as well put put their money into new property and sell it out. There's a lot of considerations in that landed we clearly have not been able to justify until recently the movement in the inner-city. We clearly have not been able to justify new value that is now coming around and we are now getting a great deal more support from running institutions and we've ever had before I suspect we're going to cover that very same topic in a bit more detail with Mark Correll from the Minnesota Housing Finance Agency who has just joined us and we're pleased to have you with us mark because now that we've talked with Ron Soderberg Saint Paul developer about some of the problems of rehabilitating dwellings. We want to turn to a somewhat related topic and that is the topic of where do people get money. And of course money most often comes from Banks because very few of us have a large nest egg with which to work with and so we must approach The Lending institutions to ask them for some kindness. Now there is an option available to many of us that some people don't know about that option. Of course is the Minnesota Housing Finance Agency You Are by no means the great sugar daddy in the sky, but you do have a fair amount of money to work with thanks in part to what the legislature has done in granting you money. And I wonder if first of all you could begin Mark by describing a little bit. What the Minnesota Housing Finance Agency. Just how much money it has available for persons in certain income brackets. Find the the state Housing Finance agency was created in 1971 by the Minnesota Legislature in part as a response to the recognition that the private lending Community could not solve all the problems some of the problems that run just referred to their needed to be an alternative for many moderate-income people in low-income people that we're just priced out of the private sector. So the legislature created the Statewide agency and we currently have nine hundred million dollars in bonding Authority which means that we can sell agency bonds which are exempt from taxes and they are revenue bonds are not obligations of the state of Minnesota, but we can sell that many bonds and then turn around and loan that money out at below-market interest rates to people wanting to rehab old homes to buy old homes or buy new homes build new homes and construct Apartments. Now there are some strings attached to that. There are some income qualifications. Is that right? Yes, that's right. We have several programs, but specifically talking about the rehabilitation area this morning. We do have a loan program which can make funds available up to $10,000 for a single dwelling to families with incomes under roughly $16,000. There is in a formula that you adjust down to 16000 and under in addition to that. There is a grant program which is for very low-income people under adjusted gross incomes of $5,000 with no repayment provision on the loan, which can be up to $5,000 unless the person moves within 7 years. Now that sounds pretty good. And I can imagine a lot of people rubbing their hands in Glee and thinking that they know now where there is some additional money available, but there may be some other problems associated with that despite how good it sounds and we'll get to that in in just a moment. But I want to remind our listeners at this point at about 18 minutes after 10. Now that we have four phone lines that we're going to make available for you to call in on because Mark and Ron we think are exceptional sources of information exceptionally good sources of information. We should say for information on money and Mark's case and on home renovation and repair in Ron's case and will give out some numbers now that you can call them at to ask your specific questions about those two areas in the Twin Cities listening area. We are at 2 9 1 1 2 2 2. That's 2 9 1 1 2 2 2 and if you're not on vacation or out in the yard washing the car or whatever you can give us a call or maybe you should. Time out from either of those two activities listeners outside of the Twin Cities call area can call us toll-free at one 806-529-7008 number again is 800-652-9700 will be giving out those numbers again in just a little bit before the call start coming in how we want to get to a couple of other points first smart. I wanted to ask you about the grant program that you talked about as you said that is designed especially for lower-income. Is that right? If you could give us a little bit more detail about what that grant program amounts to. Well, we have had nine million dollars over the last year then to loan or Grant to very low income families. There's been a special emphasis on elderly who often times own homes, perhaps they're entirely paid for but they just don't have the continuing income to be able to maintain those home. So but we're also very concerned about low income families. So this coming two years. We have a total of 21 and 1/2 million dollars to make available for those grants throughout the state about one-third of the dollars will be in the Twin Cities area in about two-thirds will be spread around the rest of the state because we have a great housing problem in the rural areas of Minnesota as well as in the cities. All right. Now we have some calls on the line and in a moment, we're going to be opening our line so you can talk with Mark and Rod I have to hand d'marco pair of headphones here. All right, we'll reach those that way we can listen to what you the colors are saying. All right, we'll take our first call. Go ahead you're on the air mark and Ron are listening. Tractors that have had experience and Rehab work. I just how do I go about finding them at night to get her interested? Well, I think that it's that you that there are home builders association's hear that and no other available contractors who specialized in Rehabilitation. I think the best source in many instances, of course satisfied customers know whether that's a communities and the communities especially Minneapolis are very active in Rehabilitation or individual homeowners now or other building owners who have had experience with contractors. There are a great number of very qualified remodeling contractors those remodeling contractors differ from Rehabilitation contractors and that they have not been as extensive that does not mean they aren't qualified or capable and I think those would be the first contract is to discuss a potential project with run. Maybe we should point out here whether or not there is an association or a place that a person can go to begin getting names or references of these people other than sign. Add customers for example General Contractors Association. All right, very good. Thank you for calling we move on to our next question now go ahead Ron and Mark are listening to your question. I know sir. It's not it's available in every virtually every community in the state as well as in the Twin Cities. There are 175 different private lending institutions and some local public housing authorities that are actually taking applications and making these loans available. If you could call the number I'll give you a week is send you a list of those of various institutions as to where you would apply for one of these lumps, but they are available throughout the state. That number would be to 96761 5 you call that Monday morning. We should be able to send you a brochure in a list of those lenders within a week or so. That's to 96761 5 and that's Monday morning and we might take just a moment Mark to follow up that question a little bit. How extensive process is this? I'm applying for a home loan or a grant to the Minnesota Housing Finance Agency. Is it a lot more red tape than any other loan application procedure. Not really Dan. We've tried to not establish a big bureaucracy on this way for attempted to work through local banks Savings and Loans and housing authorities with a much simpler process than what you might ordinarily find through a federal program for instance. So in general it only takes a few days to put an application in there only two separate applications and and it it usually takes only a few days to a week or so in most cases. So we've tried to keep it real simple and fast. All right, we have other colors waiting on the line with questions and we'll go ahead with them. Go ahead Ron and marker listening to your question. Yes, go ahead. You're on the air with that be included in the $60,000 one and two. Can you get money specifically to remodel a house for the handicapped? It would be no towards myself in this case. Yes, all sources of income would be included including disability income and then there are some deductions that could be explained to you when you make the application. But yes, we certainly encouraged improvements to homes that are occupied by handicapped or impaired individuals or families, and there certainly is no restriction on that. Although there's not a separate program. The money is available for those types of improvements such as ramps and counter lowering and things like this that could be helpful. So that shouldn't be a problem. Thank you for that question and we'll take another question. Go ahead. You're on the air to commercial property, I'm an artist and I'm not really Rehabilitation yet, but some extensive Remodeling and Repair. We do not generally have a lot of interest in the commercial area and we are really authorized only to DeLand in the housing area. Although if you're combining a space like that. There may be a possibility that that some of the money would be used that would be used to improve the residential area could also be applied to the commercial. Are you friends and such as a heating unit insulation things like this. It sounds like it would be kind of a special case which could that would have to be dealt with an individual basis when you would make an application to one of those participating institutions, so I wouldn't rule it out. But primarily we we aren't able to get into too much commercial rehab so you can now during the week so you can get on again. If you could call the the number I mention to 96761 5 there should be some staff people there. I could help you out with this or direct you to one of those participating financial institutions. If we are not in a position to help you out. My other recommendation would probably be just a normal private lending institution or credit union. For instance. All right, thank you for your question. I was Mark Rowley Minnesota Housing Finance Agency. And that was the state's point of view, of course, but since we also have run Soderbergh private developer with us, we might just throw the question to Ron to ask you if there is any suggestion you might have for this gentleman. Based on your experience in this area of commercial Rehabilitation run in here in the cities and that is living working space. How basically are primarily and warehouse space one of the advantages to that is it can be very economical in other words that can be done without much outside financing. Basically, you're talkin about raw space for living news and it would simply require mechanical systems which are typically inherent in a good commercial structure good Warehouse building in which can be live with and especially Plumbing Systems and so forth to meet I'll residential living code. It is the kind of thing that can be done on Home Improvement loans high-interest short-term loans that are obviously not the most advantageous but because of the small amount of money necessary can be accomplished on them. This just occurs to me run any unique code problems that crop up with people trying to rehabilitate a warehouse for example for Living space. Well, the code problems are simply the Adaptive reuse of that that space for residential so they do there are requirements for mechanical seals for plumbing facilities. And so far we have other callers on the line waiting to ask questions of Ron and Mark and we'll go to the next caller now go ahead you're on the air. Yes, go ahead with your question. You're on the air is the same number for financing for rehabilitation. Yes, sir. You would think that the actual building myself until it gets down to the roofing partner roofer comes in but and digging around I feel that I should be left in the house 400 contractors out in the outer area. Do I use them or do I have to clean the Twin Cities for contractors need the choice of contractors entirely your own and you could choose whoever you felt was qualified in your area or wherever else but it would be entirely a local thing if possible. Very good institutions throughout the state where you could make applications. Those are there that are working with this program. So hopefully there would be one in your community or nearby so you wouldn't have to come into the Twin Cities. Very good. Thank you for your question time is 10:30. Now, we're talkin with Marc. Carella V Minnesota Housing Finance Agency and run Soderbergh private developer and Rehabilitation from St.Paul. We want to take just a moment now to give out our telephone numbers once again for callers because a few lines have opened up in the Twin Cities area are number is 29112 to 2. That's 2 9 1 1 2 2 2 and 4 listeners outside of our local call area. You can call us toll-free at the following number. That is one 806-529-7001 800-652-9700 and I want to emphasize the fact that we haven't been getting as many questions as I would like to see for a run Soderberg who I regard as something of a gold mine of information when it comes to Rehabilitation and frankly if the questions don't start soon since I am a fairly new homeowner myself, I A few personal questions and I'm going to put to Ron regarding some repair and Rehabilitation problem. So that might work out. All right anyway, but we do have some questions on the line right now. So we will take them. Go ahead you're on the I have a question regarding a Housing Finance Agency money spring. We tried to get some money we heard that they were called and said 79% for existing structures and we sent for the list of things and so on and that was in our area. Hi, this is an ongoing program that we've had for the last two or three years but it goes in annual Cycles weed. We sell an issue of bonds and then we make that money available over a roughly in 9 month. There was roughly 10,000 inquiries for that last batch of roughly 70 million dollars, which will only be able to assist a little over 2,000 families this year. But we do expect the program to have additional money available toward the beginning of next year probably early spring late winter of 1978. So I would encourage you to to keep in touch with your own a financial institution. Unfortunately, the demand is much greater than the supply but we're attempting to to help as many people as we can. Rehabilitation but we want to buy us using our GI and we don't think be able to get any you know, that doesn't seem to be a possibility. Is there any way that a person who wants to get a GI loan? Is there any way that a person who's doing that? Well, yes, there's vangi loans are available on rehabilitated structures. It is more difficult to rehabilitate the structure as individuals and then Place grv alone. It would be a course available to purchase a home rehabilitated under VA. All right, we have other colors on the line waiting to ask questions of our guests Ron Soderberg and Mark Correll and we'll take the next call now. Go ahead. You're on the air. Problem doing one's own work in terms of wiring and plumbing standards. Legal problems in the terms of uniform housing code you shouldn't have problems. There are there are there is a state uniform housing code in there at city college which govern the rehabilitation of any structure or or the building of any structure. And if you were to perform your own Rehabilitation, you would have to receive a permit for that work and your work would be inspected by local inspectors who would authorize certain pair of repairs and improvements. I'll try to do the wiring and plumbing for Minneapolis both have a program where you can take a test and be qualified to do your own electrical and plumbing systems for your own individual use on your own structure. You would not be qualified to do work on others other structures, but they do have programs where you can be qualified and licensed for unit structure. Yes. I mean the only two areas that I'd run into that with the two main areas that require licensing. That's correct. You would be able to do your own carpentry without a specialized? Okay. Thank you. Thank you for that question and brings up another question. And that was the test to mention run how difficult is that test? Is that something that many people can expect to pass without difficulty or is a fair degree of skill involved. I think clearly many people can pass it that have Mechanical Aptitude. It is not a difficult tested. You're given a booklet by the city st. Paul Minneapolis to study and then used subsequently take the exam but you I would expect that you have some need for mechanical aptitude. All right, we have other colors waiting on the line with questions for I guess we'll go to the next one. Go ahead. You're on the air. Do you know if there's any fish to insulate my home? I'd like to go somewhere to take out to some solar energy. Well, we can perhaps have both guests respond to that. Maybe Mark Correll first on the insulation financing. Yes clearly the the money that's available from the state Housing Finance Agency. One of our main priorities is insulation and energy saving improvements to older home. So we would strongly encourage this and a loans would be available if you're in adjusted family income is under $16,000 in Grants could be available if it's under $5,000. Now what's your experience with that same situation Ron? Well, we're doing basically Dan with bulk financing of a total restructuring. So we have not been involved in individual find it now. There was a question about solar heating and solar projects as well Mark. Do you know anything about that aspect of the question? It's a brand new area as we all know and they're just beginning to get standards established by which I think they're going to be very important for the protection of the consumer in this area. It is possible to finance through our state program solar water heating equipment, which has been approved by standard set up through the Federal Government Federal housing Administration with respect to space solar heating and cooling. We are currently not in a position to finance that yet because the standards have not really been set up and a lot of the products have not been fully tested so that we know that they're going to be effective in the consumers going to get a Affair product for his price All right, we have I think we have that color back on the line with the with an additional question. She does phone she'll get about 15 to $18,000 minimum income you talked about. No, it wouldn't that would be considered a an extraordinary one-time income which could be deducted from the calculation so that I shouldn't prohibit her from qualifying for a grant if she were to buy a new home in and have that low of an income to do some repair work on that home. Alright, thank you for your questions. And we have a couple of other callers waiting on the line with questions. We have some lines open as well. So if you have a question so bronze Soderberg st. Paul developer or Mark Correll from Minnesota Housing Finance Agency and jot down these numbers and give us a call. We are at 2911 to 22 in the Twin Cities. That's 2 9 1 1 2 2 2 and 4 listeners outside of the local call area. You can call us toll-free at 1-800. 652-970-0800 6529700. We have some callers waiting with questions will take the next one. Go ahead you're on the air. Play N Trade income punctuates quite a bit better than, but $38,000 or so. You would have to include all sources of income if you're self-employed friend since there are maybe certain deductions that could be taken which would be tough to go into right now on the radio. But yes, if the income is not steady income you would average the last two years for the purposes of this program. Okay, and if I need more information now, is there a number a person I can talk to you later or cook this transcript? Printed out and could we send for copies? Yes, the the number I'll repeat again where you can get more information is to 96761 5 if you could call that during the week there would be people at that number to be able to help you or refer you next week for more information on this. 29676 15 and that's it there a number of people that can help you if you do that's area 6 1/2 it's in st. Paul. Okay. Well, thank you very much. Thank you for your questions or you didn't have a radio to listen to cuz the first part of the program has been pretty good and I think the last part here will contain some more information that might be useful a little earlier on developer on Soderberg was talking about some problems of Rehabilitation and renovation. And I know Ron that when I thought for the renovation and Rehabilitation or repair of a home I had assumed that it could be done only on a home that had a very sound exterior say brick or stone. For example in that wood frame homes are essentially out of the picture that would homes around the turn of the century. For example have deteriorated to a point where they can't be salvaged, but then you pointed out the Milwaukee Avenue renovation. Project and maybe you could talk a little bit more about why you think some wood structures can be saved. Well, in fact Dan brick structures can frequently be deceiving and their appearance of solidarity frequently. That's a brick veneer that has suffered deterioration in the framing members behind it and has caused a lot of very very expensive repair problem. Wood frame course was was and still is the bulk wave building housing wood-frame houses with proper maintenance in their history can be restored up to a hundred or a hundred fifty years old. And of course in other parts of this country, not 200 years. There is problem with moisture. There is problem with the deterioration from insects and mildew and so forth and that's because of a lack of Maintenance. Those are things that have to be noted on a structure before you can anticipate the actual replacement cost to repair class questions related to that. Ron is a specific repair over the next few months because Summer seems to be a big for a popular time for this sort of activity thousands of man and woman hours will be spent on the process of stripping wood. Ashley interior wood that fine woodwork that the many Scandinavian Carpenters were so fond of putting in the single-family and multi-family dwellings in in Minnesota. Especially I think we'll find out and what are your secrets for wood stripping if indeed you dealt much with that question. Well, I wish there was a secret it is strictly a labor of love clearly. There is a grand reward at completion. But the process is painstaking we have allowed our homeowners the opportunity to strip their own would work simply because of the intense energy and labor that that's required to do that. Now some that have blocked gallons of stripper and bought the rubber gloves and everything that I understand that there are electric coil devices that will heat the pain and take off wood and then of course you can use a saint Devices to is a mix of all that the best the best recipe or one or the other. I think it's really never do individual preference. There are those basically three methods for Homeowner. Use there is of course the other Alternate which is commercial stripping there are commercial strippers available in the Twin Cities. It requires removing the woodwork pulling the nails from the back side as to not damage the woodwork and then taking it to a commercial stripper to have dipped and clean and then of course piecing it back in and putting it back in place at chimneys and fireplaces are another issue. There are lots of old ones in these older homes. And sometimes they're falling into a bit of disrepair with bricks coming out at the top of the chimney and sometimes the chimneys not operating properly what sorts of pointers do you have in that area? Well, that's a pretty important consideration to and in most of the existing housing in the Twin Cities when we're talkin about turn of the century house. Early early 20th century. We're dealing with fireplaces that were originally designed for coal and gas burning. They have smaller fluids in a required for burning wood. They have shallower hearts than are required for burning wood. They do not adapt easily to wood burning one of the chief desires of today's market is to have wood burning fireplace. It's one of the grand amenities of these older homes. Frequently those fireplaces at a very decorative in a home are simply that decorative and should not be used for wood burning without extensive rebuilding that would mean a widening of the chimney or replacement of the chimney complete from the fireplace route to the roofline and additionally the deepening of the Hearth to give depth for Woodburn. Now, we have another caller on the line with a question for run Soderberg and Mark Correll of the Minnesota Housing Finance Agency in will take that call now go ahead you're on the air. Is there anyway of a resting dry rot siding and such that the that you want to that you want to celebrate your use for one reason or another once you've eliminated the sources of water and leakage and all that. Is there a chemical treatment that they can arrest The Rock once you have eliminated the cause of the dry rot. You should not have additional dry rot. Canada grow by itself. That's correct. It should stop with the elimination of the Quad. It should be cut out and replaced if you have deteriorated siding or Joyce and and how is that should be cut out and scabbed on or replaced two of them? I've architecture that would be almost plowed be prohibited to replace the back side and the water Backup backup. So depending on the backside. Okay, you maybe You may be taking a chance if you remove the detail because it made it to you right in your hands. It may be easier to maintain the decorative detail just by preserving it with specials sealants like a creosote. Thing that would write there's any number of products available in full stains, but that permeates the wood and then seals it in a sense. It would be sealing however something that has already gone through a deterioration process. So the short of replacement you could only be looking at maintenance of that existing piece of you. What part concrete? Foundations are basement walls. Is it the is it possible to overdose for insulation? No, that's that's fine. I guess I need a clarification of the poured concrete foundation that has deterioration of the Interior. Is it poured concrete over limestone in or is it a solid concrete wall? It's an exposed to a walkout basement sort of thing. It wasn't falling in Greek huge chunks. It's basically that problem is caused by too much lime in the mixture of concrete when it was when it was originally poured and that that inner surface is deteriorating. Yes. In fact, you can scrape that loose mortar off and you can patch it with a basically concrete patch using a concrete adhesive and regular Ready Mix Concrete and you could frame out in front of that wall for insulation. You could do it with any number products first with glued on styrofoam to which you can apply any number of paneling is or gypsum board or any number of other surfaces not as long as you have it clean solid surface. And so if you have patched it properly and prepare to properly and you've you've cleaned it down, you should not have any additional problem with that are the expensive strips in their nails or well it's always difficult to apply for rooms two strips to concrete. It would be far simpler for the average homeowner to Simply build a new wall in front of the concrete wall to build a new to buy for framed wall with the plate on the floor and ceiling that's correct. Very good. Thank you for your questions and we have now 8 minutes before 11 and we have just a little time to close out the program with what is a bit of a change of pace really because I want to close it out with some details about new homes from both Ron and Mark first from Mark Minnesota Housing Finance Agency, of course, as we have talked about a little bit earlier makes loans for new home construction. And that is something that is you mentioned takes place around the state of available to every citizen in the state and one of the unique aspects of that program, I think because I heard about it from you Mark is the affordable homes program, whereby a homes that have a few less Frills can be built that cost a little bit last live in but they look pretty nice according to the description you gave me wonder if you could give us a few of the details about that program. Yes, I could again. I think the legislature recognize that the cost of of new housing is is getting very very high. The average price of a new home is over $50,000 in the Twin Cities area and indeed around the country. We felt it that it was important to try to demonstrate that smaller homes with less amenities can be billed number 1 by contractors at a reasonable price and number to that people will buy them that they can provide decent living quarters for many many families that you don't need a 2000 square-foot Rambler in the suburbs. So we've embarked upon several programs to encourage the construction of new homes that are saying thousand to 1200 square feet. Not only in the smaller communities in suburbs around the state but also in the center City's there's a lot of vacant land that needs to be rebuilt and clearly a many people throughout the state cannot afford that average new price home suerte. Sing to encourage a construction of of smaller Homes at lower prices and then provide a blow Market interest rate mortgage on that house to as I understand it though. Not every Community is receptive to the concept of an affordable home. In other words. There are some communities that have the zoning restrictions that essentially make the possibility of an affordable home out of the picture and woman. If you could give us some detail on that, well, that's right that the zoning laws do differ from Community to community around the state and in some cases. It's just accidental in some cases. It's more deliberate but we're attempting to encourage a mix of housing a mix of opportunities for families. Not only in single-family, but also an in multifamily rental housing throughout the state and all communities and we don't have the capability to change local zoning laws so we can offer an incentive through financing and so on down example of a local zoning law would be one where Community for exam. Requires that every home have a driveway that would be restricted for example to an affordable home. Is that right? Well, even take it one step further driveways are fairly important but garages are things some people's homes communities require two car garages some communities require at least a minimum square footage on the lot as well as on the house which run up the cost to 50-60 $70,000 and this is just obviously hurting many many families that may want to live in that community that just can't afford that Now we want to turn that subjective new homes around for a moment and put it to run Soderberg and that's the issue of for the homes that have building materials that summer not salvageable others are salvageable. There may be Timbers in the home. For example, that can be used what Ron is the feasibility of using some of the materials from older homes for new home construction. Well, certainly we have a lot of salvageable materials and clearly one of the primary reasons of the cost of new construction. Today is material cost Lumber and we fully expected Lumber cost will double within the next five years as we run out of as we deplete our natural resources. There is such possibility. It is not yet proven to be cost-effective. I would not anticipate it would be until the point where we have reached at 5 your point of inaccessibility of of new construction of new building materials because of Labor intensity and recycling. It can be done by homeowners if they do not pay themselves a wage but to pay a prevailing wage to pull nails and recycle number is prohibitive at the present time. I would not anticipate. However, that would remain that way now you mentioned that lumber prices will very likely double. Next few years as they have doubled within the past few years. I wonder if you have come upon any solid alternatives to lumber for example, in some building process. These are there things that can be used in new home construction. For example, or even renovation that people frequently overlooked. The reason we are dealing with Rehabilitation is because it is that alternative to using the resources know at the present time. We are not concentrating in that area. There will be Alternatives. I would suspect that their concrete systems. I would suspect that. That's what we will be dealing with him in new construction systems that will require however, great deal of Market change and great deal of of attitude no change in the industry before we can and and code changes before we can be building a great deal of residential property in concrete. All right, very good will gentleman. I want to thank you for being with us this morning and answering questions about Rehabilitation and also money for homes in home Rehabilitation Mark Correll from the Minnesota Housing Finance Agency Basin St. Paul Ron Soderberg Saint Paul Area developer and thank you again. And also thanks to our many callers who and excellent questions for both guests today are some good points to make as well technical director for this broadcast has been Michael Moriarty in our thanks for his help as well.