Real Estate Agents Encourage Attendance at Council Meeting

On Monday, the Ellwood City borough council will vote on whether or not to implement a new inspection code ordinance. If it passes, and a betting person would say it will, then all residential, not commercial, buildings in the borough will require code inspections prior to sale.

What does this mean for residents? Anyone planning on buying, selling or renting real estate must comply with a strict structural code. If the building or structure fails to meet code standards, then the owner must either pay for significant repair costs or receive less return on their investment. Also, the inspection costs $100, which goes on top of several other fees already necessary to buy or sell a home, such as appraisals, home inspections and dye tests.

Three local real estate agents with a combined 91 years of experience want to encourage the public to attend the upcoming meeting so that they understand how the new ordinance affects the entire borough. Zak Powell of R.W. Powell Real Estate Services, George Sewall III of Century 21 Preferred Properties and Joe Carofino of Advantage Homes Real Estate, all plan to speak prior to the council vote.

“New Castle and Beaver Falls both added this inspection. In those towns we saw home values fall, and vacancies significantly increase. Roughly 90 to 95 percent of homes are financed, which means people already need several inspections for banks to ensure the home is safe,” Sewall said after conducting extensive research on the new ordinance. “The new code also will raise house prices, and cause rent to go up. For people on fixed incomes with older houses, this is devastating.”

According to reports generated by the National Resource Directories, Ellwood City homes currently hold an average worth of nearly $10,000 more than both New Castle and Beaver Falls. Also, vacancy rates in Ellwood City are a fraction of a percentage point (.1%), in comparison with New Castle (1.8%) and Beaver Falls (3.2%). Further, rental vacancy percentages are over 5% in New Castle and above 4% in Beaver Falls, while Ellwood City sits at less than one percent.
Sewall, who received his real estate license in 1976, is also a licensed appraiser, as well as a builder and developer. He believes that the negatives of the new code far outweigh the positives.

“The average home in Ellwood City was built in 1939, which means most homes will not pass this inspection. Since the inspection implementation in New Castle and Beaver Falls, people could not afford to rent or purchase homes, so the buildings never sold, and sat vacant,” Sewall said. “I built the most recent development in the borough (Meadowridge), and I guarantee that not one of those 22 new homes would pass this inspection. The majority of homes in Ellwood City are in nice shape, and people take a lot of pride in home ownership here. With a few minor repairs, these homes would be completely safe.”

Joe Carofino works with many homes in both the Ellwood City and New Castle areas because his business rests between the two towns. His experience is that home buyers typically shy away from New Castle homes.

“So many buyers don’t want to even go near New Castle because of politics and increased codes. There are too many barriers,” Carofino, who obtained his real estate license in 1990, said. “Right now we are in a declining market. Now is not the time for Ellwood City to do this.”

Zak Powell, a broker and appraiser since 1979, spends most of his time promoting the town in which he was born and raised. When Westinghouse chose to house its nuclear energy complex in Cranberry in 2007, Powell reached out to many of the 3,000 employees about buying or renting homes in Ellwood City. The R.W. Powell owner believes that the new code will compromise what attracts buyers and renters to the borough: Value.

“Most homes in Ellwood City cost between $40,000 and $80,000, which does not include improvements. Whether you own or rent, the code enforces the same guidelines. Home owners and rental property owners will end up owing more than their homes are worth, which of course will put rent out of proportion as well.” Powell said. “We are going to lose buyers that can afford homes in Ellwood City.”

With the looming ordinance on the cusp of passing through council, the three agents believe that many questions still remain unanswered. In the initial document produced by council, the overall cost to the borough of the inspection process was not mentioned. Sewall says that voting should not be conducted without first knowing and explaining the cost.

“I want to know a few things. Who did the research for this project? What study was done? What are the projected budgets? How many additional people do they need to hire? Also, the borough regulations are not listed,” Sewall said. “I don’t believe government should be in housing. When I spoke with council members, they were unsure of the costs. How can you pass this and not know the costs?”

Carofino, Powell and Sewall all encourage residents to come and hear the guidelines of the new ordinance for themselves.

“There are four new council members here to represent Ellwood City and protect our interests,” Carofino said in reference to the upcoming meeting. “We hope to have a full house.”

The meeting begins at 6 p.m., but anyone who wishes to speak prior to voting should arrive early to register.

“We urge the public to attend and hear how this will affect their investments,”  Powell added.