6/10/2004
2000 Realtors in Sacramento for Legislative Day
This focus on the annual Legislative Day, where Realtors meet with their elected officials, is on protecting private property rights and increasing the supply of homes in the state, a subject that is timely for many states: Legislative Day 2004.
6/08/2004
Growth in Home Prices has its Achilles Heel
An article in the Los Angeles Times (May 20, 2004) covered remarks by Nicholas Retsinas of Harvard University's Joint Center for Housing Studies which stated immigration, global financing and slow growth/restricted growth policies were the three main factors in the surge in housing prices. Now, the Center's 2004 State of the Nation's Housing study also talks about overcrowding and the higher amount of income spent on housing as the downside of this market. Well, it wasn't perfect. While renters and homeowners spent more, mortgage rates also dropped from 7.9 percent in 2000 to 5.7 percent in 2003. But household growth will continue to grow as immigration and other household formation factors fuel the demand. Unmarried women accounted for 30 percent of the growth in homeowners from 1994 to 2002, the study also found. See that report here.
6/07/2004
Job Growth May Hike Interest Rates
The 248,000 nonfarm jobs created in the United States last month brings to nearly 1 million the number of new jobs that have been added since February, the largest three-month gain since May 2000.
Manufacturers are contributing to the job growth, stepping up the pace in May with 32,000 new hires.
The increase could bolster the Federal Reserve's stance that the time is nearing for a hike in interest rates even as the country's unemployment rate has stayed pat at 5.6 percent.
The Fed policymakers have said that any rate hike will be "measured," knowing that the first in a series of rate increases will carry the potential to cause turbulence in some markets.
Source: Wall Street Journal (06/07/04);
Manufacturers are contributing to the job growth, stepping up the pace in May with 32,000 new hires.
The increase could bolster the Federal Reserve's stance that the time is nearing for a hike in interest rates even as the country's unemployment rate has stayed pat at 5.6 percent.
The Fed policymakers have said that any rate hike will be "measured," knowing that the first in a series of rate increases will carry the potential to cause turbulence in some markets.
Source: Wall Street Journal (06/07/04);
Rate Increase in Your Future
So with the chatter of a "jobless recovery" diminishing to a whisper...what happens next? Any doubts of the Fed making an increase to short term interest rates have vanished, and it certainly appears inevitable that a .25 to .50% hike will be delivered at the next FOMC meeting scheduled for June 30th. Remember that there are many different types of interest rates, and the Fed manipulates the Federal Funds Rate, an overnight lending rate between banks, not interest rates for mortgages. Many people - including some of the national media - believe that when the Fed "raises rates", there is a direct correlation to rates on first mortgages. Not true. In fact, when the Fed finally does give the Fed Funds Rate a hike, it should ease the inflationary market pressures and surprisingly give Bonds a boost, which would reduce rates on mortgages. -- The Mortgage Market Guide
6/06/2004
Sales vs. Consumer Confidence
Consumer confidence may slide but that alone does not stop people from investing in real estate, in fact, just the contrary, click here to see more about our western economy and the strong demand for limited supply.
Southern California Immigration
Immigration is one of the factors seen by Harvard University's Joint Center for Housing Studies and others as one of the three factors of the rising cost of real estate both nationally and locally, the others being global financing and restricted growth policies. A study released by the Public Policy Institute of California found that 26 percent of California’s population in 2000 is foreign-born, as compared to 22 percent in 1990. According to the U.S. Census, 2.8 million new immigrants arrived in California between 1990 and 2000. 46.2 percent of new immigrants were born in Mexico, compared with 38.2 percent in 1990. A full copy of the report can be obtained here from the Pacific Council's site.
6/05/2004
Increase in California home price
As of the end of April, sales prices of existing homes increased 24% higher than the same time last year, bringing the median home price statewide to over $453,000. Last year at this time the median price was $364,000. Insufficient supply and increase in population are two reasons for this continuing rise. See the full California Association of Realtors report here.
6/04/2004
Buying a home downpayment
You may have to think about retirement funds to come up with your down payment if you have no other alternative. Using your IRA or 401(k) should first be checked out with your accountant or financial planner, but if you have no other choice and if you're a first time homebuyer, look at this source as a place to start for information.
6/03/2004
Report Finds Mold Poses Only Modest Health Risks
(June 2, 2004) -- A long-awaited report from the National Academy of Sciences (NAS) concluded that exposure to mold will result in only modest negative health effects. In 2002, the U.S. Centers for Disease Control and Prevention directed the NAS to conduct a comprehensive scientific literature review of the health effects of mold, identify research gaps, and make recommendations to address future public health policy in this area.
The NAS, in a report titled "Damp Indoor Spaces and Health," concluded that the current scientific literature on the health effects of mold exposure found sufficient evidence of an association between exposure to damp indoor environments (where mold is likely to grow) and respiratory health distress symptoms, including coughing, wheezing, and increased incidence of asthma in sensitized persons. Limited evidence was found for an association between damp indoor environments and more serious respiratory illness. Insufficient evidence was found to support a relationship between damp indoor environments and severe health outcomes, such as cancer, pulmonary disease, or death.
The report concluded that excessive indoor dampness, and subsequent exposure to mold, is a public health problem. However, additional research should be conducted in several areas, including mold exposure and serious health outcomes; the interaction of the wide variety of exposure factors in the indoor environment on human health; and the effectiveness of various remediation methods.
—NAR
The NAS, in a report titled "Damp Indoor Spaces and Health," concluded that the current scientific literature on the health effects of mold exposure found sufficient evidence of an association between exposure to damp indoor environments (where mold is likely to grow) and respiratory health distress symptoms, including coughing, wheezing, and increased incidence of asthma in sensitized persons. Limited evidence was found for an association between damp indoor environments and more serious respiratory illness. Insufficient evidence was found to support a relationship between damp indoor environments and severe health outcomes, such as cancer, pulmonary disease, or death.
The report concluded that excessive indoor dampness, and subsequent exposure to mold, is a public health problem. However, additional research should be conducted in several areas, including mold exposure and serious health outcomes; the interaction of the wide variety of exposure factors in the indoor environment on human health; and the effectiveness of various remediation methods.
—NAR
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