Eye on Santa Fe

The Tax Cuts and Jobs Act – What it Means for Homeowners and Real Estate Professionals

The National Association of REALTORS® (NAR) worked throughout the tax reform process to preserve the existing tax benefits of homeownership and real estate investment, as well to ensure as many real estate professionals as possible would benefit from proposed tax cuts. Many of the changes reflected in the final bill were the result of the engagement of NAR and its members, not only in the last three months, but over several years.

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May 21, 2019

The Ugly Word Arises

So, we had declared that everything was in place for a fantastic economic ride. Low interest rates, a moderately expanding economy and rising stock prices. Then the ugly word was uttered — tariffs. It took one word to put a bump in the road of our goldilocks economy. As soon as the word was spoken (or Tweeted) — the markets immediately showed their dismay.

Now, this word had been bandied about before as part of the many trade discussions which have taken place in the past few years. Sometimes the word just turns out just to be part of negotiating tactics. Or, the tariffs implemented are not as extensive as threatened. In these cases, the markets have quieted down, and the economy has moved along its merry way. It has been about two weeks since the word was presented recently, and in this case the drama has continued.

However, the initial reaction we have witnessed reminds us that it only takes one little — or big — thing or event to upset the apple cart. Natural disasters, political events, international tensions, and more, have the ability to put a charge into the economy and the markets. Thus, the word tariff can be very ugly, or it can just be a gentle reminder. Only time will tell.

 

Scott Robinson, Gateway Mortgage Group

 

REAL ESTATE NEWS

First American Financial Corp., Santa Ana, Calif., said rising home affordability is benefiting home buyers at a key point of the spring home buying season. “The interest rate-driven affordability surge arrived just in time for the spring home-buying season,” said Odeta Kushi, First American Senior Economist. “Home buyers have reacted positively to lower rates. When rates dipped just before springtime, applications for residential loans surged nearly 19 percent for the week. While many of those applications were for refinances, there was also renewed interest in home buying. Rising affordability has already benefited home buyers and, if the lower rate environment persists, we’re in for a great spring home-buying season.” Kushi added: “Combined with higher incomes, the good news for home buyers and the housing market is house-buying power is at its second highest point in over two decades. Source: First American

Baby Boomer homebuyers must have a laundry, but they would rather do without an elevator or a wine cellar in their home according to a recent study by the National Association of Home Builders (NAHB). The study, which is part of its What Homebuyers Really Want Report, revealed that while their top home feature likes and dislikes are in sync with other generations, baby boomers are more likely to have strong opinions about what they want, and don’t want, in their homes. While a laundry room topped the list of must-have features with 94 percent of baby boomers listing it as an essential feature, 91 percent of this generation would also like energy efficient windows. At 89 percent, a patio also rated high among home features desired or essential for baby boomers, followed by a ceiling fan, garage storage, and exterior lighting, with 88 percent of boomers listing these features as essential or desirable in a home. A full bath on the main level, walk-in pantry, hardwood flooring, and a fully energy efficient home rounded off the top 10 home features that baby boomers desired. The report noted that the only feature listed by baby boomers that was different from other generations was the desire to have a full bath on the main level. Among community features that were ranked as most desirable by baby boomers, having a home near a retail space ranked first, followed by walking/jogging trails, suburban homes, walkable communities, and homes close to a park area. Source: NAMB

Baby boomers are the fastest growing segment of roommate seekers, growing twice as fast as any other group. SpareRoom reports that, according to date from Harvard University’s Joint Center for Housing Studies, people over the age of 50 living with roommates has grown by 27 percent in the past year, with a total number of 2.6 million older people living with non-relative roommates. “People think of apartment sharing as a young person’s game, but that’s no longer the case,” says Tom MacThomas, SpareRoom’s US General Manager. “The over 50s might not be the biggest group of roommates but they’re definitely the fastest growing.” Rising cost of living across the U.S. as well as inflation means that many older Americans are seeking roommates as a financially-sound alternative to living alone. Additionally, life changes such as divorce means that many are seeking roommates for the first time in their lives. For renters, having a roommate could save those 50 and older over $25,000 a year. MacThomas cites the financial benefit as one of the reasons for the growth among older roommate-seekers. Source: MReport

 

 

 

 

 

 

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