Larry Roberts real estate writing blog: January 2016

Sunday, January 31, 2016

OCHN: Free real estate seminar at 5:30 on February 4, 2016 at JT Schmids Restaurant in Tustin, CA

The Dan Hrey Group, the Everyday Luxury Group, and the OC Housing News are teaming up to provide a free real estate seminar on February 4, 2016 at JT Schmids Restaurant in Tustin, CA.
IRVINE, Calif., January 31, 2016 – On February 4, 2016, The Dan Hrey Group, the Everyday Luxury Group, and the O...
Free real estate seminar at 5:30 on February 4, 2016 at JT Schmids Restaurant in Tustin, CA

Friday, January 29, 2016

OCHN: Do Americans possess healthy shame concerning consumer debt?

A majority of Americans hold a healthy disdain for consumer debt, but most carry debt anyway.

When you see an American Express Card commercial, do you see a sophisticated financial manager or an irresponsible spendthrift? The credit card companies want you to see a savvy money manager who...
Do Americans possess healthy shame concerning consumer debt?

Thursday, January 28, 2016

OCHN: Many homeowners downsize when released from their bubble-era debtor"s prison

After enduring 10 years of excessive mortgage debt service, many people downsize when prices rise high enough for them to sell.

Most people visualize the housing ladder as a steady upward progression from starter home to Mansion by the beach, but that’s seldom the reality. Many people...
Many homeowners downsize when released from their bubble-era debtor"s prison

Wednesday, January 27, 2016

OCHN: House prices could fall and the cost of home ownership could still go up

Lower house prices due to higher mortgage rates still result in a higher cost of home ownership.

Everyone shopping for a home wants to see lower prices. For most products, paying less for it means the buyer has more money available to purchase other goods and services, but with houses this...
House prices could fall and the cost of home ownership could still go up

Tuesday, January 26, 2016

OCHN: Is pessimism about housing warranted?

Without rational pessimism, people are susceptible to foolish optimism that fuels financial manias.

Optimists are happier than pessimists. If you spend your life seeing the good in people, situations, and outcomes, you live in an inner world of bliss, contentment, and exciting possibilities. If...
Is pessimism about housing warranted?

Monday, January 25, 2016

OCHN: Millions of homeowners trapped in entry-level homes for over a decade

With housing markets only now reaching the peak of the housing bubble, many have been trapped in their homes for over 10 years.

In 2005 most people who bought their first homes believed they won the lottery. In the five preceding years, house prices more than doubled, and since most people...
Millions of homeowners trapped in entry-level homes for over a decade

Friday, January 22, 2016

OCHN: Why do politicians want foreign investment in real estate?

Foreign investment costs politicians nothing, and it provides them tangible and taxable assets.

Have you ever gone to an Irvine new home model center and seen buses of foreign tourists on a shopping spree? I have, and I suspect many others have seen the same thing. Anecdotally, Irvine...
Why do politicians want foreign investment in real estate?

Thursday, January 21, 2016

OCHN: The most important key to avoid overpaying for a house

A willingness to walk away from any negotiation is essential to avoid overpaying for a house, or anything else for that matter.

Negotiating the sale of residential real estate should be no more difficult than negotiating the sale of any other product or service without a fixed price; however,...
The most important key to avoid overpaying for a house

Wednesday, January 20, 2016

OCHN: New York bankers preserved their own home values while crushing others

New York bankers refused to foreclose on properties in New York city to preserve the housing values in their own neighborhoods.

As Bernie Sanders recently pointed out, a cadre of major banks in the United States issue more than 35% of all home mortgages, and when you consider how many they...
New York bankers preserved their own home values while crushing others

Tuesday, January 19, 2016

OCHN: Affordable housing requires more construction and more foreclosures

Since affordable housing is opposed to the interest of existing homeowners, policies which would truly improve affordability are shunned in favor of ineffective alternatives.

Most people in California suffer from higher housing costs than the rest of the US, putting major pressure on...
Affordable housing requires more construction and more foreclosures

Monday, January 18, 2016

OCHN: Does Coastal California’s great climate create real estate value?

Many wealthy and powerful people make Coastal California their home because of the weather, and they build companies and stimulate the economy.

The local climate in Coastal California contributes to real estate value, but not because everyone wants to live here. By far the largest reason...
Does Coastal California’s great climate create real estate value?

Friday, January 15, 2016

OCHN: US cracks down on money laundering in real estate

By forcing owners of shell corporations to reveal their identities, US officials will slow the flow of illicit money into high-end real estate.

People who make money outside the legal financial system have a problem. If they want to put their money back into legal circulation without exposing...
US cracks down on money laundering in real estate

Thursday, January 14, 2016

OCHN: California will always have a problem with homelessness

Good climate, good services, and a chronic shortage of housing combine to create an intractable problem with homelessness in California.

What is the minimum level of housing quality people are entitled to? If you pose that question to Coastal California residents, many will cite their...
California will always have a problem with homelessness

Wednesday, January 13, 2016

OCHN: Mortgage interest rates may not go up, housing may prosper in 2016

The federal reserve raised the federal funds rate, but that doesn’t mean mortgage interest rates must rise.

The future of housing in inexorably tied to the course of mortgage interest rates. If mortgage rates remain below 4.25%, both house prices and sales volumes will be higher in 2016...
Mortgage interest rates may not go up, housing may prosper in 2016

Tuesday, January 12, 2016

OCHN: Bernie Sanders bashes too-big-to-fail banks

In a recent speech, Bernie Sanders unapologetically bashed the too-big-too-fail banks. He’s a rare breed: an honest politician.

I recently wrote that Donald Trump will be the next President of the United States due to his populist appeal. However, for people like me who really want to see...
Bernie Sanders bashes too-big-to-fail banks

Monday, January 11, 2016

OCHN: Will the slowdown in China hurt Irvine real estate?

A rising US dollar makes Irvine homes much more expensive for Chinese buyers, and capital controls makes it much more difficult to move money out of China for those inclined to do so.

Chinese investors buy a significant number of homes in Irvine. Anecdotally, 80% of sales in some new home...
Will the slowdown in China hurt Irvine real estate?

Friday, January 8, 2016

Housing Market: Expect years of low sales volumes in residential real estate

At this point we can be certain that banks are going to avoid or delay foreclosure or short sale until prices rise so they don’t have to lose money on the sale. They have no choice. With banks still exposed to $1 trillion in unsecured mortgage debt, they simply can’t take the losses...
Expect years of low sales volumes in residential real estate

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OCHN: What Millennials learned from the housing bust, and why they won"t buy houses

Millennials are not climbing on the property ladder, upsetting everyone who depends on real estate transactions to make a living.

A common refrain among housing industry advocates is that Millennials are simply ignorant to the benefits of home ownership, and if they could only be...
What Millennials learned from the housing bust, and why they won"t buy houses

Thursday, January 7, 2016

OCHN: Restricted supply and improving economy boost sky-high California rents

What do you get when you combine a strengthening economy with a chronic shortages of housing? Sky-high rents.

California began restricting growth in the 1970s with regulations like CEQA. Local opposition groups sprang up ostensibly to protect their quality of life. What started as a reaction to...
Restricted supply and improving economy boost sky-high California rents

Wednesday, January 6, 2016

OCHN: Extremely weak sales is the new normal in housing

After nine consecutive years of extremely weak sales, low sales rates are starting to look like the new normal.

A lie, if repeated often enough, becomes accepted as truth. The mainstream media is reporting that home sales are strong and demand is robust. Compared to the depths of the housing...
Extremely weak sales is the new normal in housing

Tuesday, January 5, 2016

OCHN: California legislators want to tax businesses through real estate

A proposed real estate tax will be passed through to businesses across California, failing to tax the people it’s aimed at.

“Take from the rich and give to the poor.”
The legend of Robin Hood resonates with those who believe the unequal distribution of wealth is a social...
California legislators want to tax businesses through real estate

Monday, January 4, 2016

OCHN: High-end real estate continues to weaken

Higher interest rates create superior investment alternatives that will drain money out of high-end real estate investments.

The rich always get richer, and they use their wealth to buy real estate at ever-increasing prices — At least that’s what most people believe (particularly...
High-end real estate continues to weaken

Sunday, January 3, 2016

USA Housing: Lenders unwilling to loan to wealthy strategic defaulters, hoocoodanode?

Actions have consequences — which is not to say that many bailout advocates want everyone to avoid these consequences — but in the real world, the decisions we make impact our lives. When rational people make good decisions, they carefully consider the potential consequences of their...
Lenders unwilling to loan to wealthy strategic defaulters, hoocoodanode?

Friday, January 1, 2016

Housing Market: Large down payments provide stability to the housing market

Down payments are the bedrock of the housing market. Large down payments preserve home ownership, reduce volatility in the market, and reduce the risk to our financial system. The only people who oppose them are realtors and originate-to-sell lenders who see down payments as an impediment to...
Large down payments provide stability to the housing market

OCHN: Alternate housing market price measurements

The median sales prices does not give any indication of what was obtained for the money spent. Median prices may be flat while people are either getting more for their money or settling for less. Also, the median sales price when charted over time occasionally gives false signals when prices...
Alternate housing market price measurements