Transit, Housing and You: What's in it for REALTORS and their clients?

So how was your commute to work this morning? If it was anything like ours, then you will have bought breakfast for your whole office in order to make up for being late - or at least distract your boss with delicious morning pastries.

Editorial aside: Your blogger has never fully bought into the myth of the "American love affair with cars", at least here in Los Angeles, because it's not like there has been a choice in many American suburbs built after the Second World War. But now that choice is returning.

Over the next few weeks, National Public Radio is visiting cities around the U.S. to look at how different communities deal with their transportation issues. This morning, NPR started with Arlington, VA, a bedroom community outside of Washington, DC which is now an attractive destination in its own right. No longer is Arlington only known for the Pentagon; now it has so much more:

"What's different here [in Arlington] is the metamorphosis, from a downtrodden suburb where everyone drives to a place where people live, walk, bike, eat, play and commute, all without ever getting behind the wheel."

and then there's this:

"Lynn Richards, who works for the Environmental Protection Agency — which gave Arlington a Smart Growth award — lives in Arlington and says that as people have flocked there, housing prices have skyrocketed."

Transportation and transit-oriented development do have an impact on REALTORS and their clients. This is a trend that our profession cannot afford to miss. Be sure to bookmark NAR's Transportation Toolkit for a primer on transportation and its effect on real estate.

Meanwhile, set your radio dial for the next NPR story about transportation and bask in the rich irony that you will probably hear it while you sit in your car, jaws clenched, in traffic as you try not to be late to your next listing appointment.

South Bay REALTORS: How do you "sell" your city to prospective clients? Find out at our November 14 YPN event!

Join the South Bay YPN for their last mixer of the year. November 14th at Baleen from 4-6pm. Come listen to Redondo Beach Mayor Steve Aspel and Hermosa Beach City Councilmember Michael DiVirgilio talk about what makes their cities great - and maybe even share some unique stories! You will think about how to position these cities for your clients, and also get ideas on how to promote other cities in the South Bay as well.

 This is a REALTOR ONLY event. No vendors or non-REALTORS. You must bring your business card for entry. We hope to see you there!

Click Here to Register.

California Governor Shuts Down Legislative Scheme to Sneak Rent Control Into Your Neighborhood

California Governor Jerry Brown yesterday vetoed a bill that would have effectively sneaked rent control into new apartment buildings where it has been prohibited since 1995. Despite aggressive opposition from California REALTORS, the bill passed through the legislature and landed on the Governor's desk. However, the Governor said "no, thanks" to AB 1229, which would allow cities to incorporate inclusionary zoning. This bill would have gutted the landmark Costa-Hawkins Act of 1995, which prohibits rent control in new construction.

In his veto message, Governor Brown thought back to his days as the mayor of Oakland, Calif., and worried that inclusionary zoning, despite its intent to bring affordable housing to under-served communities, in fact does the opposite:

"As Mayor of Oakland, I saw how difficult it can be to attract development to low and middle income communities. Requiring developers to include below-market units in their projects can exacerbate these challenges, even while not meaningfully increasing the amount of affordable housing in a given community."

Trouble is, rent control just doesn't work. The Governor in his veto of this bill demonstrated his understanding of how to discourage bad policy and encourage investment where it is needed most

The legendary five-term Congressman and Speaker of the House, Tip O'Neil, is remembered most perhaps for his saying that "all politics is local". Yesterday in California, the Governor took the best of his experience as a local elected official - big city mayor - and put a stop to bad policy. Sometimes, maybe, the best policy can be made when policymakers are closer to the communities where that policy will affect.

Would you like fries with your jumbo loan? Rates hit a historical low this week

Interest rates on jumbo mortgages fell below those of 30-year fixed rate mortgages for the first time in history, according to a report published by NAR today. Jumbo loans are those over the local limit that can vary from $417,000 to $729,750, depending on the county.

Since a significant number of homes in the South Bay are priced well within that range, the accessibility and availability of jumbo loans to qualified buyers is a critical part of a healthy housing market in our area.

Traditionally, jumbo loans have cost consumers more than a conforming 30-year fixed-rate loan. However, NAR found that "with mortgage rates much higher than a year ago and declining profits from refinances, banks have become more aggressive in pricing mortgages. As a result, it is now cheaper to borrow in the jumbo market which is currently dominated by private lenders."

This milestone in jumbo rates comes along at the same time that REALTORS are pressuring the Federal Housing Finance Agency (FHFA) not to reduce loan limits and effectively redefine what a jumbo loan actually is. NAR is still looking for assurances that FHFA will not unilaterally reduce loan limits just because it wants to; FHFA simply has no authority to do so.

Now, with the timing so close, are reduced jumbo loan rates and FHFA action somehow related? Probably not. To quote one of our favorite lines from The West Wing, "Hard to tell." Correlation is not causation, although the increased conversation is certainly welcome.