Michael A. Howl

California Housing Market Update 📈 - California home prices are up by 3%, with a median price of $816,300. Homes sold slightly increased, but they are staying on the market longer (33 days on average). - In migration trends, 26% of homebuyers are seeking new metro areas. Florida, North Carolina, and Tennessee top the list for destinations, while many are leaving California, New York, and Illinois. Check out this article to learn more about the latest housing market trend in California 🔽 #2024HousingTrends

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This is exactly the wrong solution to the #housing supply shortage in #California and will only exacerbate the problem... Proposition 33 consists of 23 words: "The state may not limit the right of any city, county, or city and county to maintain, enact or expand residential rent control." Proposition 33 would repeal the Costa-Hawkins Rental Housing Act, a three-decade-old state law that prohibits cities from establishing rent control over all single-family homes and housing units built after 1995. https://lnkd.in/gCu8-q_c

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LAist reports that Los Angeles housing officials have released a long-awaited report recommending changes to the city’s rent control policies. If adopted by the city council, the new proposals would significantly lower rent hikes next year for the 42% of L.A. residents living in rent-controlled housing. This is one reason Paladin Realty Partners, LLC avoid investing in rent-controlled (1978 and older) apartments in L.A. As rent control erodes operating margins, owners have less incentive to invest in property upkeep, potentially leading to blighted conditions in many neighborhoods. Over time, properties may be removed from the rental market, worsening the #AffordableHousing crisis. https://lnkd.in/gV5RhGWi

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I couldn't disagree with Mr. Schwartz's assessment of California's #housing crisis more. Government does in fact have significant impacts on the price of land, the cost of construction, job growth and the availability of skilled workers. Subsidized housing can't meet the need alone. -Government's police powers control land use through General Plans, Zoning, Sphere of Influence, Urban Growth Boundaries and other mechanisms. Land use dictates how much land is available and hence the price. More land available for development = lower land prices. -- The cost of construction in California is also one of the highest in the nation. Title 24 (energy code) and the State's building code are some of the most onerous in the US and significantly increase the cost of construction. --California's high fuel costs, are a major determinant of input costs such as concrete, asphalt, lumber and other building materials. -- High density, transit oriented development is prohibitively expensive. Many cities are clearly biased against missing middle housing such as townhomes, duplexes and garden style apartments which are far more cost effective to build. -- California's regulatory environment and high taxes on individuals and business impair job growth. Just look at the number of corporate relocations to more business friendly states such as Texas, Florida and Tennessee. -- California was once a leader in education. We created the UC system in 1868. To move forward, the state should invest in expanding trade schools to help expand the pool of highly skilled labor. Any way you cut it...policies matter. #CEQA might not be the cause of the housing crisis but it is a major deterrent to housing production and needs to be reformed especially for development within existing city boundaries. Even simply allowing victims of frivolous lawsuits to sue for damages would tip the scales of justice while still protecting the environment.

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Will the Ninth Circuit take this case on appeal? In my opinion, there is no nexus for making property owners bear the burden of supplying #affordablehousing in our communities. All members of society should bear the burden or put pressure on our elected officials to make policy changes that increase #housing supply and lower the cost to build new homes. “Despite its name, Seattle’s Mandatory Housing Affordability law does the opposite of what it intended — it makes it unaffordable for people like Anita to build housing on their own property,” Institute for Justice attorney Suranjan Sen said in a news release. The role of the Takings Clause is to ensure that particular individuals are not forced to “alone . . . bear public burdens which, in all fairness and justice, should be borne by the public as a whole.” In considering a challenge to a governmental action or regulation relating to private property, the Court must first evaluate whether a taking has occurred. https://lnkd.in/g28ap93N

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Southern California's real estate market is on fire!

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Too posh to push for new housing - Opposition to shaking up planning puts LA’s 250,000 housing target in jeopardy. Sound familiar? At least they have a plan. There’s been a lot written about whether or not the Labour government will hit its 1.5m target in recent days. The vibe given off by ministers is “we’ve pressed the planning reform button, now go do it”. Don’t get me wrong, the planning shake-up is welcome, overdue and needs to happen yesterday. But things don’t seem joined up. Aside from the huge contradiction served by upping SDLT on housing (daft for first- and last-time buyers) and adding IHT to pensions (which surely encourages people at the lower end to pump more cash into their homes, which can be passed on), there seems little appetite to tackle the wider issues. 1. Affordable housing - the figures quoted during the Budget speech are total BS for starters. And until there’s greater flexibility on how grants are used, the piddling sums handed out will continue to not touch the sides. Why not chuck in a ton of public land and stand behind a few lenders to lessen the cost of development finance? 2. BSR - the growing shitshow of Gateway 2 is now a bigger blocker than planning. I’m piecing together a podcast on this, so if you want to have a chat on it, message me. I’m surprised this isn’t being more loudly talked about. 3. Zoning - why does this appear to be off the table? Even that most virtue-less and teflon of politicians (Jenrick) saw fit to push this - probably the only sensible thing that got put forward before Gove came in and made a mockery of the law with his raft of ill-informed and, some would argue, illegal measures to mess up leasehold. 4. The Greens - why is a party supposedly in favour of new social housing (150,000 a year they claim) and in favour of supporting renters still not only blocking everything in sight but also promoting rent caps when the evidence is clear? If you put 10 economists in a room and asked them a question, you will typically get 10 different views. If you whack them in a room to chat about rent caps you will get one answer. The Greens’ (and other groups’) negative rhetoric on nuclear energy over the last 20 years has left us poorer and less secure on energy. Why is this nonsense ideology not being challenged at a time where people - including myself - want to support the wider Green Party (and green) agenda? Read their stuff here: https://lnkd.in/e3SmXZNx https://lnkd.in/eJkWzdU9

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#Sacramento has passed a plethora of new housing laws to address barriers to #housing supply. The data clearly shows that these efforts have not produced the desired result due to special interests influence in drafting these laws. Most local jurisdictions take the position that housing doesn't pay for itself and blame Proposition 13 for today's high impact fees that raise the cost of housing. However, the truth is that State and local governments have mismanaged #taxpayer dollars, leveraged land use authority to damage property owners (as well as new #homebuyers) and passed onerous #labor, #energy and building codes that increase the cost of construction. Government needs to prioritize spending on basic services ie #police and #fire and #infrastructure investment and repeal legislation have driven construction costs in #California to the highest in the US. If the #Sheetz decision made anything clear, regulatory agencies cannot force #property owners to pay for costs that should be borne by society at large. "The Takings Clause saves individual property owners from bearing “public burdens which, in all fairness and justice, should be borne by the public as a whole.” https://lnkd.in/giyz7CfC

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For the 3rd time in recent years, California voters rejected efforts to expand rent control by a resounding 20-point margin. The latest attempt, #Proposition33, would have repealed the 1995 Costa-Hawkins Rental Housing Act, a relatively balanced housing policy aimed at incentivizing new housing development by prohibiting municipalities from capping rent on vacant units, single-family homes and apartments built after Feb. 1, 1995. With a statewide housing shortage totaling one million units, the solution to California’s affordable housing crisis is clear:  WE NEED MORE SUPPLY!! Additionally, the Los Angeles Times published a new article with the #Prop33 election outcome. https://lnkd.in/gUZp5HF2   For more insight, see the link to my blog below:  https://lnkd.in/grxMpqzg

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What's happening in Sacramento? Zonda has released the updated 3Q data. If you are curious on how to see the unlimited potential that the data can provide you in Northern California, ask DBD Allison Paul, and Carla Schaefer on how to decipher the market. For new home listings DBD Marcie Elliott and Daniel Cross for Mortgage Pro data. And to further understand what is happening in the Sacramento from Principal of Advisory and expert Mollie Carmichael will be providing key insights and potential of the market at the Sacramento Frame on the 14th of November. As shown below the market is changing...but where is it going? To register ask Allison Paul, Carla Schaefer or the link below: https://lnkd.in/gfQPsaq6 To understand the National Market or your local markets: Chief Advisory Officer Tim Sullivan Chief Economist Ali Wolf Sean Fergus (Published Research and National Outlook) Livabl & New Home Source Listings Karyn Bonder & Steven Greco Nicollette Chapman (Mortgages) Kimberly Byrum (formerly Fiala) (Multifamily/Rental) Todd Tomalak (Building Products) Bryan Glasshagel (Texas/Midwest) Dan Fulton (Mid-Atlantic) Adam McAbee (Branded Residences) Evan F. (Western US/Districts/Land Plan) Ryan Early (Data Interogation and Custom) Shaun McCutcheon (Carolinas) Susan Heffron (East coast) Mark Zawistoski (Education)

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Newsom's budget proposal includes cutting 10,000 vacant state jobs and implementing an 8% cut to state operations without any layoffs. If similar measures are taken on a larger scale at both state and federal levels, it could lead to an increase in the unemployment rate above the Federal Reserve's 4% target. On Friday, he repeatedly vowed he would not sign a sweeping tax increase on individuals. However, he did propose suspending a popular tax deduction for businesses, which many see as a tax increase. Washington tends to follow these trends. I hate to think of the tax increases that will be pushed in the coming years on businesses. It is already a huge challenge in many industries, especially with expenses increasing so significantly and the cost of capital being so high. I can't imagine how these companies in California will survive and remain profitable. https://lnkd.in/g8etnvzc

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Reasons You Should Build an ADU NOW #3 Demand for Rental Units at the ADU Price Point Remains High There are 17 jobs created for every housing unit built in San Mateo County and the numbers are similar all over the Bay Area. Many of these jobs are right at the moderate income level filled by workers that have one-hour commutes, each way. These workers are great candidates for renting out an ADU. In other words, you will likely never have a problem getting renters and generating passive income from your ADU. The "problem" is getting the 'right' renter for your new unit, and before another landlord sweeps them up. Call NOW 1-888-360-3604 FOR A FREE SITE VISIT & STRATEGY SESSION CONSULTATION CalBRE#01795093, CSLB#1114186 www.adunow.house #adu #adunow https://lnkd.in/gySz_HNw

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The “Builder’s Remedy” has been one of California’s most controversial housing laws for decades. But now legislators are looking to “clear up and rein in” the housing statute. The proposed overhaul “includes new perks for developers, textual edits to clear up how the law would apply, and a provision to let developers who make use of other state laws allowing them to bypass environmental review and public hearing requirements to make use of builder’s remedy guarantees too.” We will have to see how this develops but it could mean some significant changes down the road for the state. #California #HousingMarket #Legistlation #FairHousingMonth

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Many of the large real estate investors I've spoken to have called California uninvestable for the past few years, and unfortunately, things do not seem to be pivoting. Here are the key points highlighting the challenges: Corporate Exodus: Numerous companies, including major housing developers, are relocating out of California due to high taxes, stringent regulations, and a more business-friendly environment in states like Texas and Arizona. This trend has seen over 350 companies move their headquarters from California between 2018 and 2021, continuing into 2024​​. Insurance Exits: Major insurers like State Farm, Allstate, Farmers Insurance, and The Hartford are no longer issuing new homeowners insurance policies in California. They cite the increased risk of wildfires, rising reinsurance and construction costs, and a stringent regulatory environment as key reasons​​. Impact on Housing Market: The withdrawal of insurers is making homeownership increasingly difficult and expensive. Prospective buyers are left with the costly California FAIR Plan as their only option, which is significantly driving up homeownership costs​. Regulatory and Political Factors: The insurance industry is lobbying for legislative changes to allow for more flexible rate adjustments. Consumer advocates argue that the current moves by insurers are strategic to push for deregulation​​. These issues highlight the complex and challenging environment for real estate investment, homeownership, and all businesses in California. The state's economic and regulatory landscape needs significant adjustments to attract and retain businesses and residents. #RealEstate #California #Investment #Housing #BusinessEnvironment https://lnkd.in/eZ9jyTSu

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