Tag: housing

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Affordable Housing?

Oh the lies they tell to sell. San Diego is in the midst of a so-called affordable housing crisis, for which the poorly urban-planned cure eases zoning laws to increase population density among some neighborhoods. Funny thing, circumstances convince me that developers and politicians define “affordable housing” differently than do I or other residents. Rather than lower the entry point to rent, many newer properties raise it such that by comparison the already high monthly that I, or others, pay suddenly seems more affordable. Ah, yeah.

Consider, as example, the soon-to-open Blvd North Park, which takes up the block between Alabama and Florida on El Cajon. The complex is a wonder of marketing myths—ah, lies. As you can see from the Featured Image, which shows the leasing booth and building behind, the structure is very much under construction. Yet the leasing manger told me two weeks ago that the place would open—meaning be ready for tenants—on September 1. That’s the first lie; okay, a presumed one. The second is indisputable.

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Why We Went to Julian

Our family relocated to San Diego in October 2007 with a purpose: Being close to my father-in-law, so that he could continue to live independently, which he did until his passing, at age 95, in January 2017. Eleven years is long enough. The Wilcox clan, or part of it, contemplates exodus, because the area is increasingly less desirable: Cost of-living and recent zoning changes that will increase population density by way of building more multi-unit housing.

My wife and I are considering many different possible locations to move—anywhere from Arizona, Colorado, New Mexico or Texas to Delaware, North Carolina, or the Mid-Atlantic region we left to come here. That said, closer-by would be more practical, particularly if we were to buy a home. Earlier today, Annie and I spent several hours in Julian, Calif., where we looked at four houses for sale. 

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Tent City

From the Adams Ave. overlook, seen across the canyon to the backside of Franciscan Way, a tented home hugs the hillside. In early Summer, My wife and I walked through the multi-level dwelling during one of its countless Open Houses over the course of many, many months. The overly-expansive layout, square-footage (3,860), and $1.7 million asking price were reasons for our disinterest—and perhaps many other people. There is a pending sale, as of the week before Christmas, for $1.55M, which explains the extermination rig.

Californians tent homes to fumigate, which is common practice before a new sale closes. Think of it as a temporary tent city for vermin, before insecticide snuffs them out. Funny thing, tent city also refers to where groups of the downtown homeless gather together. If neighborhood banter on the NextDoor social network is revealing, there are many University Heights residents who view indigents as vermin they would like to eliminate

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Graduating from the Schoolhouse

On Oct. 15, 2007, our family of three relocated to San Diego from the metro-Washington, D.C. area. Looking back at my blog posts from a decade ago, I see very little writing about the move and regret not recording the poignant personal history. It’s not a mistake to be repeated. My wife and I will soon change residences—and while the move is nowhere near as dramatic as the last, this missive you read begins the chronicle of our next adventure.

Strangely, or not, the decision to leave the current apartment is fallout from our failed home-buying effort—for the property we call the Schoolhouse (and affectionately, at one time). Anne and I learned enough to know that we aren’t ready to own, certainly not in overly-priced Southern California. As such, staying put for another year looked likeliest option; we have, or had, until October 20 to sign another year’s lease for our second-floor rental of 10 years. 

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The House on Monroe

Feeling a little glum about mum—she was laid to rest back home in Maine yesterday morning—I took a long, late-afternoon walk through the neighborhood. As I approached Mississippi along Monroe Ave., a cute craftsman with “coming soon” for sale sign piqued my interest. I would later discover that the property listed the same day (Aug. 25, 2017). Striking: The unbelievably low price for University Heights: $525,000.

I have not seen such interest in a home! Jumping ahead in time, briefly, I later took my wife to look at the Monroe house. Cars and SUVs of various types pulled over in and around as we approached; I am amazed there wasn’t a vehicular or pedestrian collision. A small mob had formed before the informational brochure holder. One man walked in circles, flip phone to ear, one hand waving, and frantic—no panicked—expression filling his face. Dare I say foaming at the mouth, as he desperately tried to contact the listing agent? If you need a metaphor, think Black Friday outside Wal-Mart. Even this morning, when I shot the Featured Image and its companions, using Leica Q, this little ramshackle rustled as much attention. 

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The Stagers

While walking past Campus and Meade this morning, I saw stagers moving furniture into a house “coming soon” for sale. After initially crossing the street, I turned back. The vantage point appealed to me, and Leica Q was in tow. The bold, yellow crosswalk symbols in the foreground are what made the moment worth capturing.

The Featured Image is the original, slightly straightened. Neither this pic, the other, or two crops of both have been retouched. I imported the DNG originals into Adobe Photoshop Lightroom and exported as JPEG. Vitals, aperture pre-set for street shooting: f/5.6, ISO 100, 1/800 sec, 28mm; 9:49 a.m. PDT.

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Don’t Believe Housing Market Lies

I once again see disturbing trends rearing their ugly heads in the U.S. housing market. Twelve years ago, I warned about the housing bubble long before it burst—then living in the Washington, D.C.-metro area. Now my vantage point is San Diego, where home prices soar and sales (finally) start to stagnate.

Justification, set against measurable trends, often is a fantastic measure that something is amiss.

Metaphor: In film “The Big Short“, set during last decade, a Florida real estate agent drives around a group of Wall Street investors trying to discern whether or not there is a housing bubble. As they pass property after property for sale, she explains: “The market is in an itsy-bitsy little gully right now”. Eh, yeah. That gully later became a giant sinkhole. This morning, I received a newsletter from a local realtor that claims: “Pending home sales were sluggish in April as low supply reared its head”. Crazy thing, I see plenty of inventory for sale—and for increasingly longer times today than four or five months ago. The newsletter’s assertion rings like a justification worth concern. 

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Housing Bubble Myths Pop

For more than a year I’ve warned that the housing market would retreat with wicked vengeance, with reverberations moving through the US economy as it did earlier in other countries. Today’s Fortune story “Getting real about the real estate bubble” rips apart some of the myths sustaining the bubble.

Shawn Tully whacks the hell out of four bubble myths: “As long as job growth is strong, prices can’t go down”; “the builders learned their lesson in the last downturn. They won’t swamp the market with new houses when the market turns”; “low interest rates will keep values rising, or at the very least, put a floor under prices”; “restriction on development in the suburbs ensure low supply, and guarantee rising prices”. 

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I’d Like to Be Wrong About This

I am back on my “collapsing housing market” bandwagon. Today’s New York Times story “Keep Eyes Fixed on Your Variable-Rate Mortgage” tells of the coming doom—people unable to pay for their homes because of risky variable-rate or interest-only loans.

The story, by Damon Darlin, reveals that nationwide, interest-only loans accounted for 26.7 percent of mortgages last year. In Washington: 40 percent! 

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When the Boom Busts

I have repeatedly blogged about the impending housing market crisis. While not as apocalyptic as my stated position, SmartMoney story “Home Crunch” warns of problems on the coasts, where inflated home prices and risky mortgages will pinch many home owners.

In my neighborhood, signs of a sales slowdown are everywhere. Two houses around the corner have been on the market for months. A year ago, they would have sold within a week. Some houses are selling, but the turnover clearly is slowing down. 

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Housing Prices Decline

After warm weather temporarily boosted home sales in January, reality has returned. According to a CNN Money article, today, home sales dipped in February. More importantly, home prices receded—to an average $230,400, or decline of $6,900 (3 percent)—compared to February 2005.

I am no economist, but I expect an acceleration of the trend. Many U.S. consumers had been using home equity like bank accounts, greatly contributing to overall spending and GDP growth. Trouble signs are everywhere—and well beyond the housing sector. With the exception of some very profitable oil companies, last quarter’s earnings announcements hinted of troubles with consumer spending. When companies like Intel, even Wal-Mart, lower earnings estimate (as they did for first quarter), something’s amiss. And it is. 

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Pop!

The Dec. 19, 2005, Business Week piles on more worrisome indications that the housing bubble is deflating. The story focuses on Loudon County, Va., once one of the hottest real estate markets in the country that is now cooling off. As sales slow, sellers are cutting prices. According to Business Week, “From August to October, the median sales price for houses dropped from $506,100 to $480,000”. I expect falling selling prices and rising days on the market to be the norm in most housing markets, if not now within a short time.

I first blogged on the housing bubble in August, a year after I started warning people trouble was coming. Coincidentally, not a week following the post, a good friend asked me about real estate as an investment. She had come into inheritance money and looked to help another friend, who had been successfully speculating on houses in Pennsylvania. I strongly recommended against real estate as an investment. I hope she took the advice.