Real Estate News for Thursday, November 10th, 2005

Real estate affordability sours Californians. But residents may be gaining ground in housing struggle. Despite a drop in the percentage of California households in September able to afford a median-priced home compared to a year ago, affordability conditions made a slight improvement from the month before, according to a report released today by the California Association of Realtors. Click here to read more.

C.A.R. Reports California's Housing Affordability Index Fell Four Points to 15 Percent in September. C.A.R.'s monthly housing affordability index measures the percentage of households that can afford to purchase a median-priced home in California. C.A.R. also reports housing affordability indexes for regions and select counties within the state. The Index is the most fundamental measure of housing well-being in the state. The minimum household income needed to purchase a median-priced home at $543,980 in California in September was $128,270, based on an average effective mortgage interest rate of 5.90 percent and assuming a 20 percent downpayment. The minimum household income needed to purchase a median-priced home was up from $107,440 in September 2004, when the median price of a home was $463,630 and the prevailing interest rate was 5.70 percent. The minimum household income needed to purchase a median-priced home at $212,000 in the U.S. in September 2005 was $49,990. At 26 percent, the High Desert region was the most affordable C.A.R. region in the state, followed by the Sacramento region at 20 percent. The Northern Wine Country region was the least affordable in the state at 7 percent. Click here to read more.

The Fading Housing Frenzy. Luxury Home Sales Slow, Speculators Look Gulfward. Friedman pointed to areas such as Washington, D.C. and Northern California as signs of slowing housing markets, but said that the Midwest and South were still going strong for real estate. In fact, the Commerce Department reported unexpectedly strong construction and sales of new homes in those areas for September. Many real-estate speculators, perhaps stung by declining residential housing prices in major markets, are flocking to the devastated Gulf Coast and Florida, looking for potential new commercial and residential deals to get in on. Click here to read more.

Local Homeowners Would Feel Pinch From Proposed Tax Plan. If you own a home in Long Beach, have children living at home, and pay your fair share of state taxes, the latest tax proposal out of Washington D.C. could reach deep into your pocket book. The new “Simplified Income Tax Plan” would eliminate the deductions for state and local tax payments on your federal taxes, remove the childcare credit, and cap your mortgage tax break at 15% of interest paid on mortgages up to $412,000 on your first mortgage only (well below the cost of a median home in Long Beach, listed at $485,500 last year). The good news for Long Beach residents in that boat is that it is unlikely all that will make its way through the Congress and be signed by the President, said Joseph Magaddino, chair of the Office of Economic Research at California State University, Long Beach. Click here to read more.

No Bubble Here: California Commercial Loan Delinquency Ratio Reaches 30-Month Low. California Mortgage Bankers Association announced yesterday that the quarterly delinquency ratio for commercial loans in California has reached a low, matching the ratio of Dec. 31, 2002. For the 28th successive quarter, the California commercial loan delinquency ratio is under one half of one percent. "There is certainly no bubble that is about to pop," California Mortgage Bankers Association Commercial Real Estate consultant Peter Ulrich (pictured) told CPN. "It is a very healthy commercial market." Click here to read more.

~Tina Jan~
Coldwell Banker Kivett-Teeters
1655 E. Sixth St.
Beaumont, CA 92223
Work: 951-845-5520 Ext. 105
Fax: 951-845-4916
Cell: 909-446-2666
Toll-Free: 1-877-TINAJAN
tina.jan@coldwellbanker.com
www.tinajan.com