South Orange County Blog from Bob Phillips

The Green Thumb: Four Easy Ways To Get More From Your Home Garden

The Green Thumb: Four Easy Ways to Get More From Your Home GardenGrowing a home garden creates beauty, oxygen and even food for our families to enjoy. If you’re looking to get more from your home garden, here are four easy ways to improve a green thumb.

A Good Foundation For Your Garden

Good soil is the foundation of a healthy garden. By using quality soil, you can give your garden plants the best start possible. Adding a variety of organic matter to soil will give plants a happy home to grow in.

Add two to three inches of organic matter to your garden bed at the beginning of each season. Compost, dried leaves, grass clipping and dry manure are all good organic materials to use in your garden.

Manures provides nitrogen, which is a great contributor to soil aeration and composting efforts. Being so far along in the decomposing process, the nutrients in manure are readily available for plants.

Fresh manure, however, is more likely to leach out of the soil into groundwater and streams (where the nutrients it provides can become pollutants).

Design Fundamentals To Achieve Harmony And Flow

Although landscaping your home garden is a matter of personal taste and preference, there are some fundamental principles for creating a good garden.

Balance and proportion establish the basic structure of a garden. Order is obtained through symmetry, repetition of plants, and colors or thoughtful contrast. This will create a garden space that is both balanced and proportioned.

Harmony and unity is achieved when different aspects of your garden work together as a whole. Strong focal points and a limited color palette can help with the overall look of your garden.

Prevent the eye from making sudden stops with good flow and transition in your garden. Gradual changes in height and color create the illusion of a larger space, and will make for a full and finished look in your garden.

Variety Is Important And Maintenance A Must

Have a good combination in your garden of annuals, perennials, shrubs, trees and food producing plants. Plants that require little maintenance and come back each year will take some of the pressure off when it comes to seasonal changes and garden preparation.

With more time to focus on bedding plants and vegetable gardens, you’ll yield a bigger reward for your gardening efforts. Water features and other structural focal points work in much the same way; they provide your outdoor space with added beauty and appeal that is easy to maintain throughout the year.

Don’t Be Bothered By Pests And Bugs

Although people have differing opinions on pests, at home a greener garden is always a healthier garden. Harsh pest control products can hurt wildlife and pollute groundwater.

You may be solving one problem, but using chemical pesticides contributes to another. There are many ways keep pests under control without chemical products.

With so many easy to make homemade pesticides to discover, gardeners can ditch the chemical alternative without sacrificing quality. There are also plants such as marigolds that can be incorporated into your garden that deter pests.

A garden is a labor of love that creates a welcoming outdoor space that your family can enjoy.

Need A Home With Room For A Garden?

Shoot me an email – BobPhillipsRE@gmail.com – or give me a call or a text – 949-887-5305 – and let’s go looking for one.

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Here are the top 10 markets for luxury homes

Here’s an article by Brena Swanson of HousingWire.com, 5/27/2014:

Not all home sale markets are slow

3fa67cf9f93cDespite reports of tight inventory across the nation, not all markets are struggling to survive. In fact, one market segment is reporting record growth, according the latestRedfin report.

Luxury home sales are skyrocketing and are on pace to beat last year’s numbers.

Sales of the priciest 1% of homes are up 21.1% so far this year. This follows a gain of 35.7% in 2013.

Meanwhile, on the other side of the bridge, home sales in the remaining 99% of the market have fallen 7.6% in 2014.

Lawrence Yun, National Association of Realtors’ chief economist, noted in the most recent existing-home sales report from NAR, “Some growth was inevitable after sub-par housing activity in the first quarter, but improved inventory is expanding choices and sales should generally trend upward from this point. Annual home sales, however, due to a sluggish first quarter, will likely be lower than last year.”

But the one exception, luxury home sales, paints a very different picture as 10 markets have already seen sales growth above 50% so far in 2014.

Here are the top 10 most expensive luxury markets.

10. Long Island, N.Y.:

The price to purchase home: $2,200,000

Average monthly mortgage payment: $8,787

9. Boston, Mass.:

The price to purchase home: $2,313,000

Average monthly mortgage payment: $9,239

Massachusetts

8. Ventura, Calif.:

The price to purchase home: $2,400,000

Average monthly mortgage payment: $9,586

7. San Diego, Calif.:

The price to purchase home: $2,400,000

Average monthly mortgage payment: $9,586

6. West Palm Beach, Fla.:

The price to purchase home: $2,466,000

Average monthly mortgage payment: $9,850

5. Miami:

The price to purchase home: $2,900,000

Average monthly mortgage payment: $11,583

Florida

4. San Jose, Calif.:

The price to purchase home: $3,380,000

Average monthly mortgage payment: $13,501

3. Orange County, Calif.:

The price to purchase home: $3,450,000

Average monthly mortgage payment: $13,780

2. Los Angeles:

The price to purchase home: $3,650,000

Average monthly mortgage payment: $14,579

1. San Francisco:

The price to purchase home: $5,350,000

Average monthly mortgage payment: $21,369

California houses

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FOMC Minutes: Committee Discusses “Normalizing” Policy

Fed-Minutes-Released-252April’s meeting of the Fed’s Federal Open Market Committee was held along with the Board of Governors of the Federal Reserve System.

Meeting minutes released Wednesday indicated the committee’s interest in “normalizing” its monetary policy. This included the FOMC’s ongoing commitment to tapering its asset purchases under its quantitative easing program.

The committee agreed to taper the Fed’s monthly asset purchases by $10 billion to $45 billion per month. Committee members discussed raising the target federal funds rate, which now stands at 0.00 to 0.25 percent, but the minutes clearly stated that this topic was undertaken as part of “prudent planning, and did not indicate that normalization would necessarily begin sometime soon.”

The FOMC minutes reflected the committee’s concern with achieving a balance between normalizing the Fed’s monetary policy and keeping short-term interest rates under control.

Meeting attendees considered methods for managing interest rates and considered potential impact of each method discussed on overall financial stability.

Importance Of Early Communication

Meeting participants discussed the importance of early communication of pending changes to the Fed’s monetary policy, and agreed that advising the public “well before the first steps in normalizing policy become appropriate.”

Early communication to the public of planned changes was viewed as a means of providing clarity and credibility to FOMC policy decisions and help FOMC achieve its statutory goals of maximum employment, stable pricing and moderate long term interest rates.

Potential Impact Of Achieving Normalcy

FOMC members discussed the possible impact of tools considered for use in normalizing the economy on the following:

  • Fed control over short-term interest rates
  • The Fed’s balance sheet and Treasury remittances
  • Functionality of Federal Funds Market
  • Financial stability in normal times and times of stress

The minutes noted that the Fed has never used any of the methods discussed while the Fed held a large balance sheet, and recommended that flexibility in using tools for achieving normal fiscal policy.

No decision was made about normalizing current monetary policy; FOMC and Fed Board members agreed that further study and analysis were needed before any decisions would be made.

Fed: Mortgage And Refinance Applications “Tepid”

The FOMC minutes characterized the level of mortgage and refinance applications through March as tepid, due to increasing mortgage rates and home prices.

While a survey of senior loan officers revealed that mortgage credit had been loosened for applicants with prime credit, mortgage credit remained tight for those with less than excellent credit.

The unemployment rate held steady at 6.70 percent and remained above the FOMC’s benchmark of 6.50 percent. There was some good news as the workforce expanded and the ranks of the long-term unemployed decreased.

Stable employment is important to potential home buyers; if unemployment levels continue to fall, numbers of home buyers are likely to increase.

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Highly Upgraded RSM Condo – Just Listed!

http://27paseodelsol.agentmarketing.com/

Priced at $409,900
Bedrooms:
2
Bathrooms:
2.5
Home Size:
1,250 sq.ft.
Garage:
1
County:
Orange
Property Type:
Condo, Townhome, Duplex
Year Built:
1995
MLS Number:
OC14108641

Property Description

The best location, with the finest upgrades! Sensational Cabo Vista condo – the ONE you’ve been waiting for! Granite kitchen, travertine flooring, it shows beautifully at every turn. Slate stone patio, perfect for outdoor entertaining. Direct access one car garage, and an inside laundry room. Fabulous community close to recreation centers, parks, schools and shopping. Close to it all, yet quiet and serene.

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What’s Ahead For Mortgage Rates This Week – May 27, 2014

Whats-Ahead-Mortgage-Rates-7Last week’s economic news was dominated by speeches given by Federal Reserve presidents, the minutes from April’s FOMC meeting and commencement address given by Fed Chair Janet Yellen. The latest readings for new and existing home sales were also released.

Federal Reserve Speeches Suggest Concerns Over Monetary Policy Dependence, Low Inflation

Here are highlights of comments made by each of the Fed presidents’ speeches. Richard Fisher, president of the Dallas Fed, and John Williams, President of the San Francisco Fed, spoke at a conference held at the Bush Institute.

Mr. Fisher said that 98 percent of jobs lost during the recession had been recovered, and that other jobs had been added. He also cited “bad fiscal policies,” and said he is worried about dependence on the Fed’s monetary policy when “Congress and the Executive Branch have put on the brakes.”

John Williams, president of the San Francisco Fed, said that he was concerned about slowing momentum in housing markets, although he noted that housing had driven economic recovery in the aftermath of the recession.

The inflation rate has remained well below the Federal Reserve’s target rate of 2.00 percent, and Mr. Williams said that the Fed is paying close attention to this. His remarks were supported in Wednesday’s release of the FOMC minutes of its April meeting.

Charles Plosser, the Philadelphia Fed’s president, took an optimistic tone at a speech given before the Women in Housing Foundation on Tuesday. He said that the national unemployment rate could fall below 6.00 percent by the end of 2014 and that he expects the housing market to bounce back as well.

This makes sense, as strong labor markets are known to influence consumer decisions to buy a home.

New York Fed President William Dudley spoke before the New York Association for Business Economics, and said that there would be “a considerable period of time” between when the current asset purchase program ends and the first Fed rate hike would occur.

He also indicated that he expected longer-term interest rates (which include mortgage rates) to be “well below” a historical average of 4.25 percent.

Minneapolis Fed President Narayana Kocherlakota said that the Fed should consider targeting price levels rather than the current policy of targeting the inflation rate. He said that this was not likely to occur any time soon, but noted that current Fed policy is “undershooting” the central bank’s goals for unemployment and inflation.

Fed Chair Janet Yellen cited her predecessor, Ben Bernanke as a positive example when she spoke at New York University’s commencement. She noted that he took “courageous actions unprecedented in ambition and scope” and that his “grit willingness to take a stand” had directed his decisions during the recession.

Mortgage Rates Down, Existing Home Sales Up

Freddie Mac reported that average mortgage rates dropped last week. The average rate for a 30-year fixed rate mortgage fell to 4.14 percent, a drop of six basis points. The rate for a 15-year fixed rate mortgage fell by four basis points to 3.25 percent.

The average rate for a 5/1 adjustable rate mortgage dropped by five basis points to 2.96 percent. Discounts were unchanged at 0.60 percent for 30-year mortgages and 0.40 for 5/1 adjustable rate mortgages, but dropped to 0.50 percent for 15-year mortgages.

Sales of existing homes rose to their highest level in four months according to the NAR. Month-to-month sales of previously-owned homes rose by 1.63 percent in April to a seasonally adjusted annual rate of 4.65 million sales as compared to March’s reading of 4.59 million sales. This was the first rise in sales of existing homes in 2014, and nearly met expectations of 4.66 million sales.

This Week

After the Memorial Day holiday, this week’s economic news includes the Case-Shiller Home Price Index, FHFA’s house price index and consumer confidence index.

Pending home sales, jobless claims and Freddie Mac’s mortgage rates report along with the University of Michigan consumer sentiment index round out the week’s scheduled events.

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Is It Better to Rent or Buy? Help From a New Calculator.

rent-vs-buyA new “Rent vs Buy” calculator from the N.Y.Times:

Is It Better to Rent or Buy?

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Homeownership rate slips to 19-year low while rental market tightens

An article by  Tim Logan, of the Los Angeles Times:

Homeownership rate slips to 19-year low while rental market tightens

Investment firms put brakes on home buying in CaliforniaThe nation’s homeownership rate slipped to its lowest level in 19 years in the first quarter as more households   rented and home sales remained low.

That’s according to the Census Bureau, which said 64.8% of homes in the U.S. are owner-occupied, the lowest share since the second quarter of 1995. Homeownership rates topped 69% at various times in 2004 and 2005 before the foreclosure crisis and housing crash pushed millions of Americans back to renting.

Meanwhile, the census said the rental vacancy rate stayed near record lows at 8.3%, and the median rent for  available units nationwide hit an all-time high of $766 per month.

Housing economists say there are a number of factors at work. Tight credit and higher-than-they-have-been home prices are keeping some would-be buyers out of the market. Others are sidelined by high student debt or concern about the soft job market. And there’s at least some evidence that young adults are postponing homeownership, either by choice or through economic necessity.

“I think a lot of households will be renting instead of buying for some time,” said Stan Humphries, chief economist at real estate website Zillow.

Just 36.2% of households headed by someone younger than 35 owned their home in the first quarter, down from 41.3% in 2008 — though the homeownership rate has fallen across every age group except for senior citizens.

Homeownership is lowest in the West, at 59.4%.” ( End of Tim’s article.)

From Bob Phillips:  As an agent heavily involved in the South Orange County rental market, I can attest to the claim that the number of people renting is still growing.

If you are thinking of renting your house, instead of selling it, this is an excellent time for such an idea.  I have an excellent program for getting local homes leased, for a very competitive rate. Here’s an example of a property I recently leased, while the former tenant was still in the property, having a vacancy period of only 3 days:   http://14greenbriercir.isforlease.com/

As I mentioned, my fees for getting properties leased are very competitive.  If you’re thinking of leasing your present home, or already have a rental property here in South Orange County, give me a call or text at 949-887-5305, or email me at BobPhillipsRE@gmail.com and let’s talk about real estate.

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April Home Sales Gain 20% For Month But YTD Sales Lowest Since 2008

The following is an excerpt from the latest report from PropertyRadar, a California based analyzer of property data:

April Home Sales Gain 20% For the Month But YTD Sales Lowest Since 2008

which-direction     California single-family home and condominium sales in April 2014 were up 20.0 percent for the month but were down 13.3 percent from April 2013. Despite April gains, year-to-date sales volume was at its lowest level since 2008.

     For the month, both distressed and non-distressed property sales posted gains. April 2014 distressed property sales gained 13.1 percent from March, while non-distressed property sales were up 21.8 percent.

     “Despite back-to-back double digit sales gains in both March and April, total sales volume since January continues to lag sales in 2013,” said Madeline Schnapp, Director  of Economic Research for PropertyRadar. “In fact, what is surprising to me is that year-to-date sales are the lowest since 2008.”

     The April 2014 median price of a California home hit its highest level in six years, rising 7,500 dollars, or 2.0 percent, to 376,500 dollars from 369,000 dollars in March. On a year-ago basis, median home prices jumped 14.1 percent. Driving the month-over-month price increase in April was a 21.8 percent increase in the sales volume of higher priced non-distressed properties.

     “Despite lower sales volume, the median price of a California home continues to march higher,” said Schnapp. “The rise in median home prices is being driven by the change in mix between the sales of distressed properties versus sales of non-distressed properties. Higher priced non-distressed property sales now dominate monthly sales numbers, so it should come as no surprise that median prices are up.

In other California housing news:

  • Underwater homeowners continue to impart negative headwinds to the California real estate recovery. In April, nearly 1.2 million California homeowners, or 13.5 percent remain underwater.
  • Institutional Investor LLC and LP purchases gained 7.0 percent for the month but are down 36.9 percent from April 2013. Purchases are up 19.3 percent since January 2014. Despite year-to-date gains, LLC and LP purchases are down 42.2 percent from their December 2012 peak.
  • For a second consecutive month, cash sales posted double digit gains, up 12.3 percent for the month but down 21.4 percent on a year ago basis. Since the beginning of the year, cash sales are up 33.1.
  • Flip sales gained 7.4 percent for the month but were down 21.5 percent for the year.
  • Foreclosure sales gained 2.9 percent in April from March but are down 32.4 percent year-over-year. The April gain is statistically insignificant, likely due to the extra weekday in April compared to March.
  • Foreclosure inventories continue to trend gradually lower, down 1.1 percent for the month and down 17.6 percent for the year.

     “While most real estate analysts are forecasting a robust real estate recovery for the rest of 2014, our data suggests anemic sales growth,” said Schnapp. “Elevated negative equity, high prices and low inventory are depressing sales volumes and crowding out potential buyers.”

Real Property Report Methodology

California real estate data presented by PropertyRadar, including analysis, charts and graphs, is based upon public county records and daily trustee sale (foreclosure auction) results. Items are reported as of the date the event occurred or was recorded with the California county. If a county has not reported complete data by the publication date, we may estimate the missing data, though only if the missing data is believed to be 10 percent or less of all reported data.

Here’s the entire report:  http://www.propertyradar.com/reports/real-property-report-california-april-2014

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Ways To Leverage Your Home To Reduce Your Tax Burden For Next Year

It's Tax Time - Here's How You Can Leverage Your Home to Reduce Your Tax BurdenEach year around April, we can find ourselves becoming a little more tense at the thought of what is about to occur: tax time.

Instead of falling into the trap of procrastinating your taxes, however, it’s much more beneficial to face tax time head-on and do your research on your applicable deductions well in advance.

Your home is good for many things, but using your home to reduce your tax burden may be one benefit you haven’t thought of. Here are some tax benefits that can be leveraged with your home, and some ways to lower your tax bill in 2014.

Deduct Interest On Home Loans

Though interest paid on personal loans isn’t deductible on your tax return, interest paid on mortgages is.

Home mortgage interest, for both your primary residence and a second home such as an investment property, can account for a large bill near the end of the year, and can significantly decrease your tax bill for 2014.

Interest paid on a line of credit for your home or a home equity loan is also usually deductible, and you may also qualify to deduct the insurance premiums on your private mortgage if this was a requirement from your lender. Ensure you keep your Form 1098 from you lender, and be sure not to miss each of your interest deductions.

Deducting Points Paid For A Better Rate

If you paid points in order to get a better interest rate on your home mortgage, the IRS will allow you to deduct these, too. If you meet the requirements for this deduction, one of which is that you paid the points in the same year that you purchased your primary residence, be sure to add the points to your list of deductions.

Deduct Property Taxes

Property taxes are also deductible on your tax return, and since they make up a significant portion of your home expenses each year, they certainly shouldn’t be excluded from your list of deductions in 2014.

As an annual deduction for the entire period you own your home, ensure you don’t forget about your first year in your home. If you’ve just purchased your home, the property taxes would have been split between the seller, the previous homeowner, and you, the buyer, at the time of the property transfer. Your portion of your first year’s property taxes for the home is also fully deductible.

Tax-Free Sales Gain

If you’ve owned and lived in your home for a minimum of two years and are ready to sell, you likely qualify for up to $250,000 dollars of tax-free profit, or up to $500,000 for married couples.

If the sale falls short of the two year mark, the IRS provides some tax relief if the sale is due to a list of unforeseen circumstances, such as changes in employment or health. Be sure to see where you qualify, and leverage the sale of your home for tax-free sales gain.

Having the ability to leverage your home in order to lower your tax burden is, of course, another benefit of being a homeowner. Often, reaping the full benefits of tax deductions is a simple matter of doing your research or speaking with a professional to get the information applicable to you.

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What’s Ahead For Mortgage Rates This Week – May 19, 2014

Whats-Ahead-Template-252Last week’s economic news was relatively flat, but highlights include the NAHB Housing Market Index for May, which posted its lowest reading since May 2013. Although analysts expected a May reading of 48, the May 2014 index reading was 45 as compared to April’s reading of 46.

The NAHB reported that rising home prices and unpredictable job markets were factors in builders’ loss of confidence. Although the economy is growing stronger, many would-be homebuyers remain skeptical of economic conditions and remain on the sidelines.

NAHB: Stronger Builder Confidence Expected in Coming Months

Builder confidence in market conditions for single family homes within the next six months were higher at 57, a one-point improvement over April’s reading. Builder confidence in buyer foot traffic increased by two points to 33; this was likely a result of warmer weather. David Crowe, chief economist of the NAHB, said that builder confidence is expected to improve as consumers grow more secure about their employment.

Economy: Retail Sales Slow

Retail sales for April posted a gain of 0.10 percent over the March reading of an upwardly revised 1.50 percent and expectations of 0.40 percent for April. The Commerce Department reported that without the automotive sector, April’s retail sales were unchanged. The difference between March and April retail sales readings was attributed to a burst of spending after severe winter weather and the Easter holiday.

Mortgage Rates, Jobless Claims Lower

Freddie Mac reported lower average mortgage rates across the board, with the average rate for a 30-year fixed rate mortgage one basis point lower at 4.20 percent. The average rate for a 15-year mortgage was three basis points lower at 3.29 percent. Discount points for 30 and 15-year mortgages were unchanged at 0.60 percent. The average rate for a 5/1 adjustable rate mortgage fell by four basis points to 3.01 percent. Discount points dropped from 0.50 percent to 0.40 percent.

New Jobless claims fell from the prior week’s reading of 321,000 to 297,000. Analysts had expected jobless claims to be unchanged from the prior week’s reading.

Manufacturing Sector Shows Strength

The Empire State Index, which measures manufacturing growth in New York rose to 19.0 in May against an expected reading of 5.0 and April’s reading of 1.3. The Philly Fed Index, another indicator of manufacturing, surpassed its expected reading of 14.3 and came in at 15.4, but May’s reading was lower than April’s 16.6.

This Week

This week’s scheduled economic news includes the release of the minutes of the last FOMC meeting, New Jobless Claims, Freddie Mac’s report on mortgage rates, Existing Home Sales, New Home Sales and Leading Indicators.

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