Rising House Prices Lead to Longer Commutes

It’s no secret that many people dream of living in California. This comes at the cost of an average statewide house price over twice the national average, for a number of reasons. Despite its size, California is limited in amount of vacant land available, as a result of both the high population and topographical constraints. Many areas in the state are unbuildable due to factors such as high variance in elevation and bodies of water. Construction is also expensive, and local government has until recently had little incentive to approve new construction projects.

These high prices mean a large percentage of buyers, especially those from out of state, need to look in less expensive areas far away from major cities. At the same time, the majority of business opportunities are in large cities. So new buyers are needing to purchase homes quite a distance from their workplace, leading to longer commutes. Rising house prices, especially in coastal areas, are only exacerbating the problem. Not only that, but the areas where people are able to afford to live are experiencing relatively slow growth in value, so selling often isn’t viable.

Overall, areas with higher property values correlate with higher commute times to the area, and you’ll need to pay more than the average to shorten your commute, while areas with lower property values correlate with lower commute times to the area. Prospective buyers will need to weigh the pros and cons of purchasing a particular property and be aware of areas prone to natural hazards such as fires, earthquakes, floods, and landslides, which are often expensive to insure despite being cheaper to buy.

More: https://www.realtytrac.com/news/the-correlation-between-california-commute-times-and-home-value/

Buyers regaining confidence in the market as homeowner confidence drops

Many prospective home buyers still don’t think they can afford a down payment just yet, but they’re becoming hopeful. Lenders are more willing to loan to first-time buyers, and the sheer demand is, perhaps artificially, inflating morale. Buyers are aware they need to make sacrifices, though. Over half are willing to take up a second job or cut back on how often they eat out, which is considerably more expensive than cooking at home. A third or more believe they can make a down payment if they live with their parents in the meantime, shop less for clothing, or give up some vacation time.

Current homeowners, who often have a better grasp on the market than first-time buyers, aren’t so sure about the market, though. They are still more confident than buyers, but most think the prices are too high to sell now because they would be overpaying for their next home. Currently 53% even think another economic crisis may be impending, up 16% from two years ago.

While state-wide and national statistics often differ dramatically from our experience here in the beach cities of SoCal, these tepid figures signal a slowdown in the real estate market overall.

More: http://www.valueinsured.com/trendsource/2018/3/6/confidence-among-homeowners-homebuyers-on-diverging-paths

Why is Getting Organized So Important Today?

 

By Stephanie Boyd
Professional Organizer and Founder of S.T.O.R.E.
(Solutions to Organize, Revitalize, Energize)

“Organize this, organize that!” There are “tips and articles everywhere about how to organize our lives, our homes and our belongings. Why is this such a hot topic?

As a Professional Organizer I see firsthand the emotional and physical cost of clutter and disorganization. Clutter is distracting; it steals valuable time and keeps many from enjoying their homes and their daily lives. In fact, Newsweek Magazine estimates that the average American spends almost an hour a day looking for things they can’t find!

Belongings seem to be overwhelming not only our physical space, but our mental space as well. Just the thought of organizing a household or lifetime of belongings is overwhelming to most, and seniors are no different. In fact, an annual Health and Retirement Survey found that after age 50 people become less and less likely to sell or donate items they no longer need – possibly because doing so becomes more and more difficult, physically or emotionally. This is where an objective and trustworthy professional organizer can help.

Getting organized presents an opportunity to:

– Preserve your legacy and share your story
– Spend your time with intention
– Create a more peaceful and relaxing home

 

Organizers break down the decluttering process into manageable pieces and have a multitude of resources to help with everything from the preservation of memories and keepsakes, the hauling of donations, the shipping of items being given to others and even the move to a new home. An experienced organizer understands why it is difficult to part with things and how important your belongings are to you and your life story.

If you would like more information or help getting organized please give us a call. S.T.O.R.E. (Solutions to Organize, Revitalize, Energize) is a local professional organizing company that understands the special considerations seniors face when organizing their homes or preparing for a major move.

Special Residential Services

Senior housing transition preparation
Planning for home downsizing
Sorting, donation and disbursement support during the sensitive time of bereavement

New pool safety regulations became law January 1st

Prior to the first of the year, existing law required pools and spas to have at least one of seven features designed to prevent drowning. These features are 1) an approved enclosure separating the pool from the home; 2) approved removable mesh fencing and a self-closing, self-latching gate; 3) an approved safety pool cover; 4) exit alarms on doors that provide direct access to the pool; 5) a self-closing, self-latching mechanism on direct access doors no lower than 54 inches above the floor; 6) a certified alarm that sounds when detecting pool access; or 7) any other independently approved and verified protection meeting or exceeding the same standards.

These seven categories remain the same. New law requires that newly constructed pools must have at least two of these safety features, and also requires home inspectors to conduct a noninvasive physical examination of the pool. Another change is that localities with their own local pool safety ordinances are no longer exempt from these safety regulations.

Auto Enthusiast Home in Port St. Lucie, Florida, 34953

On Saturday my email from Hemmings Motor News usually contains at least one real estate offering that’s specially tailored toward automobile collectors. It’s a bit of a personal thrill since both autos and homes delight me.

Today we have a 2300 sf house with an attached 2300 sf, nine car garage. At $395,000 (negotiable), this listing highlights prices, the big difference between Los Angeles and most of the rest of the world.  Here’s a link to photos and a detailed description. http://spoilsportmotors.com/houseforsale.htm Enjoy!

US Sees Shifts in Foreign Buyers

For quite some time, foreign real estate investors have predominantly been coming from mainland China, with a total of $31.7 billion spent by Chinese buyers between April 2016 and March 2017. Changes in the laws in China have seen these numbers decrease recently. Despite this, the number of international buyers is actually increasing. Among the countries now more greatly represented are Taiwan, Vietnam, Thailand, Dubai, Kuwait, Georgia, and Turkey. Buyers hailing from Great Britain are eyeing the luxury market in the US.  Foreigners continue to view the US real estate market as stable and secure, and are even expanding the geographical range of their investments.

More: http://realtormag.realtor.org/daily-news/2018/03/05/foreign-buyers-coming-us-are-changing

Market direction unclear as statistics suggest opposing trends

The end of February, interest rates were at a four-year high, with 30-year fixed rate mortgages averaging 4.40% and 5-year adjustable rate mortgages averaging 3.65%. At the same time, interest on treasury notes is down. This means investors are abandoning bonds and now buying mortgages. Despite changing their methods, investors don’t have any concerns about the market, which they say still features low supply and high demand.

While supply and demand may currently be low and high respectively, this analysis doesn’t account for which direction those are moving. In fact, supply is going up and demand is going down, as prospective buyers can’t afford to purchase higher-end homes as a result of the higher mortgage rates. Investors purchasing mortgages may see high mortgage rates as a sign of an improving market, but buyers don’t.

The market overall is currently wavering near the line between a buyer’s and seller’s market, so it’s hard to guess which direction it will go next. We should be able to get a better idea of the market direction at the end of March, signalling the end of the first quarter.

More buyers considering adjustable rate mortgages in current housing climate

With interest rates as well as house prices on the rise, the lower initial value of an adjustable rate mortgage (ARM) may look appealing. And the numbers say more people agree, as the percent of loan applications for ARMs has increased from 5% to 6.7% since January. If you’re considering a loan, remember an ARM rate, while initially lower than that of a 30-year fixed-rate mortgage, is only fixed for a short period. This is usually 5 years, and it can be between 3 and 10 years. After that, it could change every year, possibly sooner. Even though an ARM rate can decrease or even stay the same, with interest rates still going up, you could easily end up with a higher rate. Currently, the average 30-year fixed rate is at 4.64%, up from 4.23%, and the average for the most popular ARM rate is initially 3.85%, up from 3.5%. Buyers should be sure to consider all the details of a mortgage loan, not only the initial rate.

More: https://www.cnbc.com/2018/03/01/as-home-prices-soar-buyers-turn-to-riskier-mortgages.html

January sales stunted by low inventory and low affordability

The housing market in California had been able to fight back against the housing shortage and lack of affordable housing for months, but January saw the number of sales drop below 400,000 — totaling 388,800 — for the first time in almost two years. This is down 7.6% from December, and almost 3% from last January. Meanwhile, home prices are continuing to grow, with the median price above $500,000 for the eleventh straight month.

In Southern California, month-to-month sales decreases range from -8% in Ventura County to -27.3% in Los Angeles County. Month-to-month price increases range from 5.4% in Orange County to 12.9% in San Bernardino County. Ventura County and San Bernardino county are fortunately seeing an overall year-to-year increase in sales, of 3.7% of 5.6% respectively, but elsewhere in Southern California the year-to-year decrease is as much as -6.8%. Unsold inventory remains relatively close to last January, but time on market is lower everywhere, as buyers are scrambling to make offers on what few properties they can.

Some brokers, especially in high end neighborhoods, are speculating that buyers have run up against price increases above their comfort range. With mortgage interest rates up .5% from December, and more rate increases forecast for 2018, it could be the higher monthly costs will create a larger inventory as buyers walk away from the table.

More: https://www.car.org/aboutus/mediacenter/newsreleases/2018releases/Jan2018homesales

Investors to feel the impact of the new Tax Plan

The new tax plan includes some changes to income property investments that owners of income property should be aware of. The ownership period to include carried interest in the lower capital gains rate has increased from a minimum of one year to a minimum of three years. Before three years, it will be taxed as regular income. The depreciation schedule for residential rental property has been adjusted and is now a 30-year schedule. The 40-year nonresidential schedule remains unchanged. The tax changes also affect pass-through businesses, usually small business partnerships and LLCs, adding a 20% deduction phasing out for income above $315,00 for joint tax returns. What has not changed is that investors will still be able to take §1031 exchanges on like-kind property and still receive reduced tax rates on gains/profits taken on the sale of property.