Around the Planet Lately
Copy for Real Estate Guide Column for 5-26-06 (440 words)REAL ESTATE PATTERNSBy Ken DuVall Around the Planet LatelySome 30,000 Realtors reach out to New Orleans. We are standing by our commitment to this beleaguered city and holding our annual National Association of Realtors Conference there as originally scheduled before Katrina hit. Every year we build a Habitat for Humanity house (as we’ve done in Chico) for the host city. This November, because of the devastation, we’re going to build 54 (!) houses, to help restore New Orleans during our stay, including bringing public buildings needing repairs back to life. We Realtors will do the work! We can set no better example than by leaving New Orleans better off than we found it. Our Convention will generate $35 to $40 million in revenues to them. This is the biggest event there this year. Realtors care deeply about communities and homes. The National Assn. of Home Builders, some 1300 representatives strong, trekked to their annual Legislative Conference in DC last week urging lawmakers to enact policies to meet the nation’s ongoing housing needs. Builders will be calling on members of Congress to protect our sacred cow mortgage interest deduction; to enact a balanced agenda protecting the environment while still allowing communities to thrive; to recognize housing’s critical contribution to our economic health; and to eliminate excessive regulations that harm housing affordability. Housing accounts for over 16%, a huge number, of our gross domestic product. In the Far East, there’s an enormous building boom in Shanghai, a city of 20 million people. You wonder where all the building materials are going; consider that 4000 new skyscrapers are creating the most dynamic skyline on earth. Besides the Chinese, U.S. investors have gotten into the game big time, spurred on by Shanghai’s hosting the World Expo in 2010, billed as the financial Olympics of the 21st century. In the next 5 years they will add 1000 MORE skyscrapers, 50 stories are not uncommon, but some will be 100 stories, plus new high-speed trains, elevated highways, and a huge new ship terminal, the biggest in the world. Besides Spanish, you better learn Chinese too while you’re at it!L.A.’s City Council in their infinite wisdom just banned the demolition of 240 existing flophouses while officials figure out how to simultaneously go forward with a proposed $1.8 BILLION mega-complex redevelopment (previously mentioned here) while still preserving “affordable housing.” The city commissioned a study examining dwindling housing for these Skid Row “urban outdoors people” which recommends spending $15 BILLION on preserving those single room slums built in the early 1900’s to house the derelicts. Get this: the units don’t even have bathrooms or kitchens! Well, so what… the sidewalks are serving all their needs now! Ken owns Ken DuVall & Associates, Realtors at 3rd Ave. & Mangrove in Chico. Ken was the 2001 President of the Chico Assn. of Realtors and the 1995 Chico Realtor of the Year. See Chico MLS listings at www.KenDuVall.com and call Ken at 345-3700 for all your real estate needs. Free consulting.
The New Deal
Copy for Real Estate Guide Column for 5-19-06 (450 words)REAL ESTATE PATTERNSBy Ken DuVall The New DealHome sales are slowing from their fever pace and listings are taking longer to sell. Should an owner worry? Not if your action plan is to concentrate on a course to ensure you’ll be happy living in your home and that it’ll be in good shape when it does come time to sell. Most analysts agree that the national median price, which increased 13.6% last year, will be up 5.8% this year, more in line with normal appreciation. Historically, home price appreciation tends to run about 2% above the inflation rate, projected at 3.3% in 2006. At say only 5% appreciation, a $300,000 home will be worth $315,000 next year. If you had put $30,000 down, that’s a 50% return on your cash investment. Hard to beat.In the meantime, keep your home in tip top condition. Don’t put off deferred maintenance that creeps up over time, e.g., roof leaks, water damage from any cause, needed painting, etc. Houses that sell for the most are in prime condition. You never get a second chance at a first impression. Set up a home maintenance plan. If you do renovations or improvements, do them with an eye to their contribution to value. Don’t over improve unless you just want another personal creature comfort. Then sit back and enjoy being the proud owner of a well-cared for, highly marketable home. As long as there’s demand, values will always increase. Chico is the chosen place.As our current inventory levels are reduced, we’ll see a stable and healthy situation in new home construction. Our prolonged wet season gave the industry a hit. Home building generates $60 billion a year for the California economy and about 526,000 jobs. Meanwhile, the median price of an existing California home increased 13% year over year. It was up 4.8% in March over February while at the same time sales increased 4.9%. Add a new phrase to the lexicon: “Drive until you qualify!” For many buyers that means keeping the pedal to the metal to get far enough away from metro areas until you find an affordable home price.More single women are opting to buy instead of renting. Case in point: Stephanie decided 4 years ago to build equity in a studio condo. Now she’s getting ready to close on a 1-BR unit in the same complex. And, 3 of the 5 bidders on her old unit are of the female persuasion. Last year, 21% of ALL U.S. homes were purchased by unmarried women. Only 9% were single men. Men and women think differently (so what else is new?!) about money. Women are looking for the “nesting factor”. Men really don’t care. We can nest in our cars!Ken owns Ken DuVall & Associates, Realtors at 3rd Ave. & Mangrove in Chico. Ken was the 2001 President of the Chico Assn. of Realtors and the 1995 Chico Realtor of the Year. See Chico MLS listings at www.KenDuVall.com and call Ken at 345-3700 for all your real estate needs. Free consulting.
Looking Good
Copy for Real Estate Guide Column for 5-12-06 (447 words)REAL ESTATE PATTERNSBy Ken DuVall Looking GoodNew home sales soared in March by the largest increase in 13 years, up 13.8%. The West surged 35.7%. Existing home sales edged up too. The Nation’s fastest growing area is Riverside County, 60 miles east of L.A. It’s attributed to residents fleeing the coast in search of cheaper housing and better schools. The cities of L.A., NY, and Chicago head the list losing population to suburbia. Home sales are rebounding. The “housing bubble” has been pretty much discredited. It’s evidence of a soft landing and market stabilization. The national median home price of $218,000 is up 7.4% over a year ago; California’s just hit $561,350. National housing inventory is at a 5.5 month supply at the current sales pace, a good balance. Chico, even with a lot more inventory (381 home listings last week), higher prices, and longer market times, are selling at a reasonable pace and price. We’ve got healthy activity, with 1000’s of building permits in process. Current conditions indicate a good performance well into 2007. We’re no longer dealing with frantic clients. It’s far better competing with the rationale of the marketplace, not frenzy. Aside from loan rates and foreclosures on the rise, another problem is the shortage and increasing cost of building materials, and competent workers. There’s a big lack of both. What once cost $90 a square foot to build now costs $130. This equates to higher housing prices no matter how you look at it. In Las Vegas, they’re building THREE story homes for $324,000 versus a similar ONE story home for $400,000. The 3-story ones cost less because of their smaller lots, plus multi-story costs less to build. They’re selling fast. In L.A: Redevelopment plans for a 16 acre $1.8 billion condo/office/retail mega-plex across from the new downtown Walt Disney Concert Hall have been stalled by an ACLU suit on behalf of six “homeless” persons that permits them to continue sleeping, etc., on the sidewalks, right where the project would go. Arrests are continual in this seedy Skid Row area. The 9th District Court’s ruling held “unless adequate shelter is made available, such arrests violate the 8th Amendment against cruel and unusual punishment.” So the tail CAN wag the dog.OBIT: My dear Hollywood High School friend Elaine Young just died. She was the glamorous Beverly Hills Realtor to Elvis, Elizabeth Taylor, Warren Beatty, Burt Reynolds, Frank Sinatra, etc. She used to tour you in a Rolls Royce. When she listed her first $1 mil house in the 70’s, a prospective buyer pointed out to her it only had 1 bathroom. She responded, “Well, what do you expect for a million dollars?” What an all-time class act she was.Ken owns Ken DuVall & Associates, Realtors at 3rd Ave. & Mangrove in Chico. Ken was the 2001 President of the Chico Assn. of Realtors and the 1995 Chico Realtor of the Year. See Chico MLS listings at www.KenDuVall.com and call Ken at 345-3700 for all your real estate needs. Free consulting.
