Archive for March, 2013

Study: Zoning contributed to housing crisis

Add to the never-ending List of Things That Caused the Housing Market Collapse: zoning. Specifically, zoning for too many large, expensive, single-family homes.

That kind of policy, according to a paper in the journal Housing Policy Debate, left people who wanted to live in an area with a choice of either living elsewhere or being lured by the promise of low/no payments and the idea that they could refinance when their ARMs reset.

Naturally, they chose the latter, and the data show the result: Communities zoned for those larger homes were much more likely to see foreclosures. (And that, of course, drove down property values, making it harder for people there to refinance..)

"What we were trying to see was, whether after controlling for those factors, if there is a structural link, or a connection between the restrictiveness of the zoning and the risk of foreclosure," [author Arnab Chakraborty, a professor of urban and regional planning at the University of Illinois] said. "We found that the higher the proportion of single-family detached housing, the more mortgages are entering foreclosure."

You can read more about the study by clicking here for the news article.

Spring buzzing season approaches

Every 17 years, cicadas emerge from the ground for a few months of mating frenzy — the spring break of the insect world. Then they go back to living underground.

There are different colonies or ‘”broods” of cicadas across the country, and this spring Brood 2 will emerge. And Brood 2 is in Virginia (as well as Connecticut, Maryland, North Carolina, New Jersey, New York, Pennsylvania, and Washington, D.C.)

If it’s anything like when Brood X emerged in Ohio (when I was living there) get ready for a very, very loud spring. It was . impressive, to say the least.

I took this picture in my backyard in 2004:

Five cicadas on some leaves

That was one random plant; those things were everywhere. And loud.

And if you know cicadas (pronounced “sick-AAY-duhs”), you know that they shed their shells, which are creepy in their own right. So you make it through the spring only to be confronted with this:

(Click to enlarge. Wait, don’t.)

Cicada shells

So. happy spring, everyone!

imageSince November 2012, an arsonist has been plaguing the Eastern Shore, setting more than 70 fires in abandoned and unoccupied buildings.

He (or they) have eluded police and are driving the local volunteer firefighters nuts — these are folks with day jobs are are often out all night fighting fires.

An Onancock Realtor is saying thank you — and while raising some awareness (and money) by selling T-shirts.

Matt Hart (owner, president, Realtor, and principal broker at the Matthew Hart Corporation) and his partner, Seth Matthews, created “Eastern Shore Arsonist Hunters, LLC” and are selling shirts with the company’s name and logo, donating the proceeds to the fire department.

So. a tip of the hat to Matt for showing how a Realtor can get involved in his community.

(Want more info on the arsonist? Click here for the Washington Post story.

And here’s a map of the fires set so far:

image

)

Let’s play the glass-half-full game, and see all the positives in what the American Society of Civil Engineers’ “2013 Report Card for America’s Infrastructure” had to say about Virginia!

First off, we didn’t fail overall. We got a D+!

Fewer than 10 percent of our bridges (9.1%) are considered “structurally deficient” — only about 1,250 are in danger of collapse! (And only 17.6% are “functionally obsolete".)

Bravo for history! Our bridges are among the oldest in the nation — more than half are at the end of their designed life!

Minnesota probably got a D minusIt will only cost us about $220 million to have the the Virginia’s 3,037 state-regulated dams meet minimum safety requirements. (And heck, only about 50,000 people live in dam break inundation zones anyway. Some places have dealt with the problem by installing warning sirens. What more could you ask?)

Our wastewater systems are in great shape. It won’t be till 2020 before about half will need replacement or major renovation — that’s years away.

We’ve realized that helping educate people is a poor investment, so we’re cutting money for schools. Almost half of the state’s facilities are more than 40 years old, but no worries — we’re using thousands of trailer classrooms instead!

There’s so much more — click here to read the detailed state report from the ASCE, and let’s celebrate our successes!

Shadow inventory isn’t a problem… is that a problem?

A new CoreLogic report says that “shadow inventory” (homes in the foreclosure process that will presumably enter the market soon) is down — in January it was 18 percent lower than a year ago. And it’s continuing to drop.

For a while, there was much being made about shadow inventory and how it was going to flood the market, lower prices, and stall the recovery. (We argued against that a-plenty, but there were still a good number of pundits who spread the fear.)

Courtesy CoreLogic

Further, shadow inventory was seen as a sort-of-hidden barometer of the market. The more there was, the more indication that people were still being foreclosed upon. It was a sign of an unhealthy market.

Virginia, by the way, is in the middle of the pack. As of January, between 5 and 6 percent of mortgages are 90 or more days delinquent. Compare Nevada, Kentucky, Vermont, or six other states that have a 7+ percent delinquency rate.

So shadow inventory is down and going down. Good news, right? Probably yes. But there’s another issue.

In some ways, shadow inventory was kind of like the market’s inventory reserves. It trickled into the MLS relatively slowly, which was great when inventory was high (it didn’t push prices down). Now, though, as more areas are seeing a lack of inventory as a problem, a  little shadow inventory might be a good thing.

My spider-sense tells me that the fate of shadow inventory is something worth keeping an eye one. How much, I wonder, is sitting in REO right now — officially off CoreLogic’s radar, but still not on the market.

Some last-minute work by VAR has paid off: In his proposed amendments to Virginia’s transportation bill, Governor Bob McDonnell has asked that the proposed grantor’s tax increase in Northern Virginia be reduced from 25 cents per $100 to only 15 cents.

The bill passed by the General Assembly included a regional package for Planning District Commission 8, which includes a large portion of Northern Virginia. To help raise approximately $30 million for congestion relief, the bill (HB 2313) raised the grantor’s tax in the region by 25 cents per $100.

But when we looked at how the General Assembly arrived at that figure, we noticed something immediately: Its calculations were based on the average grantor taxes collected from 2007-2011 – years that include the worst part of the housing crash.

So we hired Dr. Chris Chmura, a well-known Virginia-based economist, to estimate sales data for the Northern Virginia area. Then, using those figures (ones that are more reflective of the current market), we saw that a 25-cent increase wasn’t necessary.

Working hand-in-hand with local associations whose members would be affected by the increase, we met with the governor’s office repeatedly over several weeks. We showed how the region could raise that $30 million with only a 15 cent per $100 increase in the grantors tax.

Governor McDonnell agreed, and worked our suggested change into his amended bill, which the legislature will consider.

We will now be reaching out to members of the General Assembly to make sure they understand our intentions, most notably, not to do the bill harm.

We think we’ve found a win-win scenario – one that lowers the amount of the grantor tax increase without lowering the amount of money that will flow into PDC 8 for transportation.

Every housing program in Virginia in one place

Lots of cities, towns, and counties have affordable-housing programs — anything from help paying for fuel to assistance with buying a first home, to everything in between.

Who has what? What’s available in your area? What kinds of programs have these places tried?

imageHousing Virginia now has everything in one place. Check it out: It’s call PlayBook, and it has information on every affordable-housing program in the state, sortable by location and program type; the organization calls it "a comprehensive inventory of affordable housing policies and programs within Virginia."

So what’s the idea?

If there’s a particular kind of program you’re interested in — say, a housing trust fund — you can see which areas offer something. (Hint: Alexandria, Fairfax, Prince William.) Then you can get details to see how they do it and who to contact for more info.

If there’s a particular area you’re interested in, you can see a list of everything offered there. (For example, Bedford County has housing goals and land use programs, as well as a manufactured housing overly district and tax relief for the elderly and disabled.)

If you or someone you know or love is interested in housing policy in the commonwealth, this is an incredible resource — not only can you see what is where, you can get the details and the contact information to find out as much as you need.

Click here to go right there, right now.

Alex Belcher of Fredericksburg is 30 Under 30 finalist

imageAlexander Belcher of MacDoc Realty in Fredericksburg was named one of the finalists for Realtor magazine’s annual "30 Under 30" — a group of "rising young stars in the real estate industry."

The magazine is looking for not just successful people, but those who have "demonstrated skill, success, creativity, and leadership in their careers."

Belcher is among the 50 finalists, of which 20 will be culled by the June issue of the magazine.

NAR’s info isn’t clear, but it looks as though there will be both the official 30 winners as well as 30 "Web Choice Winners" picked by you and me. That in mind, head over to the site (realtormag.realtor.org/30-under-30) to find out more and to vote (early! often!) for Alex.

A new study says that homes near public transportation seem to be more ‘recession resistant’ than homes further away.

This comes from the American Public Transportation Association, so my first reaction was to take it with a grain of salt. (Shocker: "Public transportation association says public transportation is good.") But then I saw it was done with the good folks at NAR as well, so I’m inclined to give it the benefit of the doubt.

The study didn’t say that homes near public transit were worth more than those further away. What it did find was that, during the recession, homes close to bus and train lines were less affected by the economy.

While residential property values declined substantially between 2006 to 2011, properties close to public transit showed significantly stronger resiliency.

In Boston, residential property in the rapid-transit area outperformed other properties in the region by 129 percent. In the Chicago public transit-area, home values performed 30 percent higher than other homes the region; in San Francisco, 37 percent higher; Minneapolis-St Paul, 48 percent; and in Phoenix, 37 percent.

Go ahead: Read all about it.

Or click here to read/download the full PDF of the study.

Property manager among the happiest jobs

According to CareerBliss ("We give you the information you need to ‘Choose Happy’"), property manager is the third "happiest" job in America, right behind Software Quality Assurance Engineer and Executive Chef. (For some reason, I received a news brief saying that real estate agent was number one. I’m not sure why.)

And looking for a bit of schadenfreude? Happy to oblige. The unhappiest jobs in America: security officer, registered nurse, teacher.

That is all.