CONSEQUENCES, CONSEQUENCES, CONSEQUENCES
The big news in NYC was, of course, the decision by Amazon not to pursue building their HQ2 there. Those of us who do not live in that area are probably mildly interested, but for those developers and property owners who had their eye out for a potential real estate boom and acted accordingly, now they will have to find a way to make their investments make sense. You like to gamble? No need to go to Las Vegas. High stakes gambling is alive and well in NYC. Painful, too, when the dice you throw doesn’t land well. Here is Housing Wire’s article on it. “Now what?” I would ask the developers.
HOME PRICE CHANGES FOR LARGEST 100 METRO AREAS
Do you live near one of the largest cities which made the list? Check out your city and the median home price. Can you afford it? Check out the “affordability index” based on annual income required to buy the home. I compare San Jose to the rest of the cities and find that the mind does not compute.
MARRIED WITH ROOMMATES
Not a new concept but one that is becoming more promising for the young Millennial. For those who are married and have a home with more rooms than they can use, here is the idea: find a roommate(s) to help pay for the mortgage. The roommate(s) will get to live in a decent home at cheaper rent and everyone cohabits (hopefully) peacefully. When good and affordable housing is hard to find, and mortgage payments are high, this is a win-win for everyone. Perhaps San Jose would be a good place to start.
HOW DEEP ARE WE IN HOCK?
This is a grim article, not for those with weak stomachs. According to the Federal Reserve’s Center for Microeconomic Data report, our household debt balances are at a considerably higher level than the debt levels that consumed us during the financial crises. Yes, we did not learn, did we, and as a nation we are more in debt having forgotten much of what was learned over 10 years ago. A brief summary of the findings of the report are in this article. However, not everything can be blamed on conspicuous consumption. Two things that we can blame – car loans and student loans. Car loans may be a conspicuous consumption item, but student loans are a grim fact of life for those who wish to achieve a comfortable one. Unfortunately, the result is that these two debts hampers the ability to qualify for home mortgage and thus housing and mortgage affordability.
AM I TO BLAME FOR THE HOUSING SHORTAGE?
Freddie Mac has published a study which concludes that in part, the housing shortage that we are going through is the fault of all seniors citizens’ (like me). If only we would sell our homes in our local communities and move to Florida, all of the country’s real estate market would benefit, including Florida. Kidding aside, the study did not imply that, but its findings are that seniors citizens are more settled in their present homes now than in any other time. Without selling their homes to move to warmer climes or to be near children, or to downsize, the pool of available housing for purchase has diminished.
In addition, the longer the seniors stay, the greater they accumulate equity in their properties. With Reverse Mortgages rising in popularity, seniors are becoming more savvy on how to draw on this equity for their “golden years”. And as they do so, they become even less inclined to sell or move away. Why should they? So many of my transactions are children selling their parents’ homes after they have passed and some do have reverse mortgages that have to be paid.
THE REAL CALIFORNIA REAL ESTATE MARKET
I attended a presentation by Dr. Somjita Mitra, Director of the Institute for Applied Economics Of the Los Angeles County Economic Development Corp. wherein she stated that California is a majority renter state. No, this is not a good thing; it means that the percentage of people who rent versus own is higher. Rentals in cities like Hawthorne, San Francisco, Pasadena, Burbank are over 60% of the total housing. Out of the top ten rental markets growths in the U.S. 6 slots are occupied by California cities: San Francisco, San Jose, Los Angeles, Oakland, San Diego and Santa Ana.
So, with all the housing woes why is California still the “Golden State”? Oh, it must be the year ‘round sunny mild temperatures, far away from snow and freezing weather (tongue-in-cheek).
If you are interested in looking at the 2018 Rent statistics for all 50 states, here is a recent report.
THE REAL ESTATE ECONOMY FROM THE MOVING COMPANY’S POINT OF VIEW
If you are looking for a view of where the real estate market, whether own or rent, is going, there is nothing that gives a better picture than stats from a moving truck company. Penske Truck Rentals has just released such a report and it looks like Atlanta, Phoenix and Tampa top the list. Jobs, of course, are what draws people.
BLACKMAIL BY MOVING COMPANIES:
On the other hand, when making that carefully considered move and hiring a moving company, it pays to carefully research those you are interested in helping you with the move. In Florida the Attorney General is going after unscrupulous moving companies who are apt to hold your possessions for ransom and demand more money before transporting them to the final destination. Blackmailed by the moving company. Is there anything more outrageous?
IT’S INCOME TAX FILING TIME!
In case you did not notice, the year is going past fast and April 15th will be upon us before we know it. The IRS has many tips for filers and one that I would bring to your attention is the matter of the W-2. What if you were not able to obtain one? Here is a IRS video to answer that question: https://www.youtube.com/watch?v=AY9ezFFpBEM
For other IRS videos, go to https://www.youtube.com/user/irsvideos
Consider this my public service announcement for the month!
FOLDING SHIRTS THE UN-MARIE KONDO WAY
As a final commentary for the month, I am one of those who has to make sure that clean shirts are folded correctly before they go in the drawer. I’m no Marie Kondo rolling up the shirts so that they take the least amount of space, but I hate wrinkles, so shirts folded flat are best, unless someone has the time and energy to iron them before wearing. So imagine my surprise when I bumped into this video of how to fold a shirt flat in 2 seconds: https://www.youtube.com/watch?v=uz6rjbw0ZA0
Time to teach the men in your life how to fold their own T shirts! Hey, if you found it on YouTube, it must be proven! Although upon reviewing the video several times my son says, “it’s black magic because I can’t get it right when I tried it myself!”
“Since light travels faster than sound,
some people appear bright until you hear them speak”
You Have Questions? We Have Answers!
Juliana Tu, CSEO, CEO, CBSS, CEI, SASIP
“Escrow is my FOREMOST language!”