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An Insider's Guide to North San Diego County's Coastal Real Estate
Jim Klinge, broker-associate
858-997-3801
klingerealty@gmail.com
Compass
617 Saxony Place, Suite 101
Encinitas, CA 92024
Klinge Realty
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Are you looking for an experienced agent to help you buy or sell a home? Contact Jim the Realtor!

Jim Klinge
Cell/Text: (858) 997-3801
klingerealty@gmail.com
701 Palomar Airport Road, Suite 300
Carlsbad, CA 92011


Category Archive: ‘Local Government’

Newsom Estate

The Newsoms bought a home in December, and currently they are living at the Governor’s Mansion in Sacramento while work is being completed prior to move-in. Hat tip Ryan!

Gavin Newsom is the new governor of California and he just bought a $3.7M house in Fair Oaks. This price point isn’t much in many areas of the country, but it’s actually the fifth highest residential sale ever in Sacramento County. This home is said to have over 12,000 sq ft and it’s located on 8 acres. It’s near the American River, but not on the river. Now two of the top five sales in the county have a connection to a governor (the other was the mansion Ronald Reagan started to build in Carmichael in the 1970s).

Link to Sacramento Appraisal Blog

7640 Tobia Way | Fair Oaks CA | 95628 from TopNotch360 on Vimeo.

Posted by on Jan 21, 2019 in Jim's Take on the Market, Local Government | 1 comment

Real Estate After the Mueller Report

Home buyers and sellers might be concerned enough about the results of the Mueller report that it could impact their decision-making about real estate – as if they need one more reason to wait-and-see!

They expect that Mueller report to be filed within the first six months of 2019, but is could be a bit redundant as players are already being indicted and convicted of crimes.

I think we can count on this:

  1. It would take two-thirds of the Senate to confirm an impeachment, so it’s unlikely Trump will be removed from office.
  2. He ain’t going to quit.

No matter how bad the actual facts could be, will the hysteria be any worse than it is today?  Trump will declare it all a which hunt, and he might incite some vigorous protests by his followers.  The mainstream media will have a field day too.

But aren’t we numb to this already?

I think so, and while there will undoubtedly be some eye-popping events immediately after the report’s release, we’ll get back to business before too long.  For some, it might be a relief that sets them free to buy and sell, and for others it could make them want to hunker down even more!

The OJ trial last for 8+ months, and that’s about as long as our society could stay distracted.  You could also say that with the onslaught of multi-media we have today – which is far more intense and scattered than it was in 1995 – we won’t stay focused on any one thing for very long.

We had a good year for real estate locally during the OJ trial in 1995 – there wasn’t much, if any, impact.  The real estate market had just hit bottom, and began what was a 12-year run!

My biggest real estate concerns for 2019:

  1. Mortgage rates
  2. Do we have enough ready, willing, and able buyers?
  3. Are sellers motivated enough?
  4. Trump/Mueller
  5. Unforeseen factors (earthquakes, border riots, etc.)

The biggest impact on the early-2019 market could be the Chargers getting into the Super Bowl! The Patriots look vulnerable, and the Bolts’ victory on Thursday had to demoralize the Chiefs:

If the Chargers win the Super Bowl, everyone will be happy about real estate!

Posted by on Dec 17, 2018 in Jim's Take on the Market, Local Government, Market Conditions | 0 comments

Manafort’s Forfeitures

Older news now but once the federal government seizes these homes and tries to resell them, they will find out that there isn’t much equity.

Paul Manafort’s prized possession — a 5,574-square-foot home in the Hamptons, which includes a putting green, pool house, pergola and “waterfall pond” and where hundreds of red and white flowers were planted in the shape of an M — will be owned by the U.S. government.

It’s one of five properties, bank accounts and a life insurance policy Donald Trump’s former campaign chairman agreed to turn over to the government as part of his plea deal, where he admitted to conspiracy against the U.S. and witness tampering.

Read More

Posted by on Dec 10, 2018 in Jim's Take on the Market, Local Government | 4 comments

Defective Nuclear-Waste Storage

Are you looking for one more reason to move away? 

It sounds like if/when the Big One starts shaking, you will need to grab everything you own and move to Yuma.

The Nuclear Regulatory Commission (NRC) admits in their November 28, 2018 NRC Inspection Report and Notice of Violation, every Holtec canister downloaded into the storage holes is damaged due to inadequate clearance between the canister and the divider shell in the storage hole (vault).  The NRC states canister walls are already “worn”.  This results in cracks. Once cracks start, they continue to grow through the wall.

The NRC stated Southern California Edison (and Holtec) knew about this since January 2018, but continued to load 29 canisters anyway.  Edison’s August 24, 2018 press release states they plan to finish loading mid 2019.

The NRC states Edison must stop loading canisters until this issue is resolved.  However, there is no method to inspect or repair cracking canisters and the NRC knows this.

The NRC should require all San Onofre thin-wall canisters be replaced with thick-wall transportable storage casks.  These are the only proven dry storage systems that can be inspected, maintained, repaired and monitored in a manner to prevent major radiological releases and explosions.

California state agencies should revoke San Onofre permits and withhold Decommissioning Trust Funds until these issues are resolved.

The Navy should consider revoking the San Onofre Camp Pendleton lease until Edison agrees to replace thin-wall canisters with proven thick-wall transportable storage casks.  This is a national security issue. If the NRC cannot do their job, maybe it’s time to bring in the Marines. The Navy has nuclear experts.

The current storage system puts the public at risk. Nuclear waste stored in thin-wall steel canisters (only 5/8? thick) cannot be inspected, repaired or safely transported. Thin-wall canisters crack, but technology does not exist to inspect for cracks or repair cracks once canisters are filled with highly radioactive nuclear fuel waste.

The President of Holtec has stated a through-wall crack will release millions of curies of radionuclides and it’s not practical to repair them, even if you could find the cracks.

Yet, they have no plan in place  to stop or contain a cracking, radiation-leaking, and potentially exploding canister.

Each canister contains roughly a Chernobyl nuclear disaster.  Once canisters explode, the radionuclides will travel with the wind, similar to how smoke traveled with the California Camp Fire.

San Onofre will have 73 canisters stored on-site by mid 2019.

Link to Article

Posted by on Dec 9, 2018 in Jim's Take on the Market, Local Flavor, Local Government, The Future | 11 comments

Two Out Of Five, For Now

This is a real estate blog, not political, but legislation gets passed that affects real estate decision-making.

Here is what the HW said we can expect from the new HofR:

https://www.housingwire.com/articles/47337-mba-lobbyist-heres-what-a-democrat-led-house-means-to-us

But let’s go back to the tax reform passed in December.

Nobody has brought this up yet, so I’m just speculating.

The original proposal was to change the 2-out-of-5-year residency requirement to five out of the last eight years in order to get up to $500,000 tax-free profit.

This provision was conceded, and all the talk centered around the lowering of the MID and the limits on the SALT deductions.

But when the final bill was passed, they didn’t change the residency requirement to the five-out-of-eight version.  It is still the two-out-of-five requirement today.

If the Democrat-led House of Representatives decides to re-visit the tax reform, there will be a lot of yelling and screaming.  But if they cut deals in the end to pacify everyone, it’s the five-out-of-eight requirement could be one of the concessions – because there wasn’t any resistance to the change last time.

It won’t matter to long-time homeowners, but for those who purchased in the last 2-3 years and were thinking of moving up or out with tax-free profit, this could hamper the plan.

Thinking of selling now, just in case?  Contact Jim the Realtor!

Posted by on Nov 7, 2018 in Jim's Take on the Market, Local Government, Tax Reform, Why You Should List With Jim | 0 comments

Prop 5 Defeated

Prop 5, the project of the California Association of Realtors, was soundly defeated – but it won’t be the last time we hear about the issue.  The supporters only spent half the money raised:

California voters have rejected a ballot measure to expand a property tax break for older homeowners who move, sparing schools and local governments a major revenue loss.

With 5 million ballots counted early Wednesday, Proposition 5 was behind 57 percent to 43 percent.

Under current law, seniors and near-seniors can transfer tax assessments if their new homes are worth the same or less than the ones they sell, and they can only do it only once. Current law also limits out-of-county transfers.

Proposition 5, backed by the California Association of Realtors, would have allowed over-55 homeowners to transfer their assessments to any new home — no matter what it costs — anywhere in the state and as many times as they wish.

It was a low-key campaign with high stakes.

“Today’s decisive defeat sends a strong message to the California Association of Realtors that voters won’t tolerate self-interested initiatives that attack the critical local services that strengthen our communities,” Graham Knaus, executive director of the California State Association of Counties, one of the main backers of the No on Prop 5 campaign, said late Tuesday.

The Legislative Analyst’s Office concluded that schools and local governments would each probably lose more than $100 million in property tax revenue a year initially and that, over time, those losses would reach about $1 billion a year for each. About 85,000 homeowners over 55 who move every year without the tax break would pay much less.

Current law requires the state to provide more funding to most schools to cover property tax losses. Not so for local governments.

Supporters said passage would end a “moving penalty” on older people and encourage more to sell, helping alleviate California’s housing shortage. The Legislative Analyst’s Office estimated home sales would increase by tens of thousands a year.

The Realtors funded a consultant’s report that contended Proposition 5 would have much less impact on state and local governments, resulting in annual losses of $120 million to annual gains of $200 million.

Opponents challenged the assertion that Proposition 5 would spur construction and warned about a hit to public services.

As a result of Proposition 13 passed in 1978, a home is typically taxed at 1.1 percent of the purchase price and increases no more than 2 percent a year. Prices have risen much more, sticking many homeowners with much higher taxes when they move.

Supporters raised $13.2 million as of Oct. 23, mostly from the Realtors, whose benefit from sales commissions. But the campaign only spent about half of what it raised and didn’t engage in television advertising or direct mailers.

Opponents raised $2.8 million, largely from the Service Employees International Union and California Teachers Association.

The Realtors recently filed notice with authorities that it would try again on the November 2020 ballot if Tuesday’s measure failed. Chris Carlisle, its legislative advocate, said it was “just to signal to our opponent we are not going away. If we lose this time, we will be back in 2020.”

https://ktla.com/2018/11/07/prop-5-california-rejects-measure-to-expand-property-tax-break-for-seniors/

If you are thinking of moving and want to go where the political climate is suitable for you, here’s how the country stacks up today (click to enlarge):

Posted by on Nov 7, 2018 in Jim's Take on the Market, Local Government | 6 comments

Hometainers

I love this idea – but $140,000 each? Hat tip Eddie89!

The region’s first housing project made from shipping containers could open as soon as April, providing homes for 21 formerly homeless veterans and possibly paving the way for hundreds of new affordable and median-priced homes in the near future.

The units are planned for a vacant lot at 2941 Imperial Ave. in Logan Heights.  Each 320-square-foot unit would have its own patio, kitchen and bathroom. While the units will be built from metal shipping containers, they will be insulated and have interior drywalls.

Read More

Posted by on Oct 25, 2018 in Homeless Cure, Ideas/Solutions, Jim's Take on the Market, Local Flavor, Local Government | 4 comments

Prop 5 – Will It Pass?

It’s one thing to talk about whether Prop 5 will make a difference, because it’s very speculative – we won’t really know unless it passes.

Will it pass?

The powers that be are pushing their agenda on either side, but I doubt there are voters sitting on the edge of their chair awaiting the outcome.

If voters just go off the voter guide for direction, this is what they will see:

The ‘con’ argument starts with two zingers and then fingers the ‘corporate real estate interests’ as the culprit.  If voters go to their website, this is the first image they see, which will make an impression:

Because the C.A.R. is already gearing up for a revised initiative in 2020, this may just be a test run.  But it would be helpful to have it pass, and see if there is any positive impact on the statewide market that could provide additional data for the 2020 initiative.

If it does pass, but the market doesn’t change much, then the C.A.R. will be able to say that we need the next round – which eliminates the inheritance tax break for vacation and rental properties, and clamp down on businesses that avoid higher property taxes when they buy commercial real estate.

Posted by on Oct 19, 2018 in Jim's Take on the Market, Local Government, Prop 13, Realtor | 4 comments

Prop 5 – Who Needs It?

As election day nears, let’s take a look at Prop 5, sponsored by the California Association of Realtors – who is encouraging agents to help get the vote out.

I’ve been skeptical that, if passed, Prop 5 would bring many more long-time owners to market.  The benefit only helps those who have a low property-tax basis currently, and won’t move unless they can take the same low tax basis with them.

The latimes.com featured a typical example here:

After Robert Holland’s knee surgery a few years ago, he’s had a harder time climbing the stairs in his trilevel home in the Tujunga neighborhood of Los Angeles.

Holland, a retired stagehand, wants to move from his residence at the foot of the San Gabriel Mountains to a one-story place nearby with a yard large enough to raise a goat and a couple of chickens.

But one big thing is holding him back: taxes. Holland purchased his home in 1995 and owes $4,500 this year in property taxes. If he buys a new house where he wants, his tax bill will more than double.

“It’s a matter of the quality of life,” he said, chuckling about his dilemma about whether to move. “I’m 63. I’m thinking what do I got, 20 good years left?”

The California Assn. of Realtors has a solution to Holland’s problem. It’s sponsoring Proposition 5, a statewide initiative that would provide property tax benefits for homeowners 55 and older as well as the severely disabled and natural disaster victims if they move to a new home.

Under the measure, qualifying homeowners would no longer have to pay property taxes based on the purchase price of their new home. Instead, they’d pay based on a combination of their new and old home values, lowering their property tax payment. The Realtors’ group, which has raised $13 million for the campaign, contends that the tax breaks are needed to help older residents and could free up larger homes that young families could use.

But a host of Proposition 5 opponents — including economists, local governments and labor unions — argue that older homeowners already receive disproportionately large property tax benefits in California. They say that providing additional breaks will exacerbate those disparities while costing cities, counties and schools billions of dollars a year.

Fernando Ferreira, an economist at the University of Pennsylvania’s Wharton School who has studied California’s property tax system, called Proposition 5 “completely nonsensical.”

“Right now, you’re giving a gigantic tax break to older homeowners who live in the best houses in the richest parts of the state,” Ferreira said. “This new proposition unfortunately will just perpetuate this inequality.”

Read full article here:

http://www.latimes.com/politics/la-pol-ca-prop-5-housing-tax-break-20181011-story.html

Upon further review, we see that the Hollands have it pretty good.  Their tri-level house is 2,400sf on a 9,216sf lot, and their zestimate is $810,083:

Link to Zillow page

But once you’ve lived in a house for 20+ years, it has become very unlikely that you will move again.  Just the cost and hassle is mentally challenging, and the usual result is to make the old knee last a few more years.

Here’s why.

These folks could move right now, and take their old tax basis with them – all they have to do is buy a house that is less-expensive than the one they sell.

If they sold their house for $810,000, they could buy this one-story house on a flat half-acre that would seemingly suit all their needs, listed for $799,999:

Zillow page of house for sale

If they were that committed to moving to a one-story house where they can  have “a yard large enough to raise a goat and a couple of chickens”, they could do it today – and take their low tax basis with them.

Do they need a swankier place?

If this house isn’t good enough, and they need a single-story that costs a whole lot more, than they should pay the regular property tax.

What is behind the scenes is the C.A.R. intent to put this measure back on the ballot in 2020 with another initiative:

After gathering signatures to put the initiative on the ballot this year, the Realtors lobbied the Legislature for a deal. The group wanted to replace Proposition 5 with a separate measure that included the same tax breaks for older homeowners, but eliminated the inheritance tax break for vacation and rental properties, and clamped down on businesses that avoid higher property taxes when they buy commercial real estate.

The California legislature didn’t go for it – and this year’s initiative just seems like a trial run to test the waters.  Can’t wait for 2020!

Posted by on Oct 19, 2018 in Jim's Take on the Market, Local Government, Realtor | 5 comments

Palomar Airport Extension Approved

Wondering what the Boeing 737 airplane needs for a runway? 

The minimum runway distance for a 737 is 6,800ft.  This proposal only extends the current runway to 5,697ft.

The article:

The San Diego County Board of Supervisors voted unanimously Wednesdsay to approve a new 20-year master plan for the McClellan-Palomar Airport. Supervisor Kristin Gaspar recused herself.

Part of the update includes extending the existing runway up to 800 feet. The county of San Diego said this would allow airplanes to reach the East Coast, Europe and China without having to refuel.

People living in the area are concerned that a longer runway could mean a lot of noisy planes — but Supervisor Bill Horn, who is also a pilot, said technology is helping fix that.

“Those airplanes are a lot quieter than the old stuff,” Horn said. “And that’s just going to improve the noise issue.”

A report from county staff said a longer runway would mean airplanes are able to increase elevation sooner after takeoff which could also reduce noise on the ground.

An economic analysis shows that by 2030 the Palomar airport could support more than 4,500 jobs and provide $33 million in state and local tax revenue. The runway extension project is expected to take 13 to 20 years to complete, depending on available funding.

The airport is constructed over portions of an inactive landfill, and stakeholders commented that runway extensions constructed over landfill areas could damage the methane collection system and impact the environment. Prior to construction of any improvements on the landfill, the methane collection system will be re-designed to accommodate the improvements.

Any runway extension that requires construction over areas of inactive landfill may not be fully eligible for the FAA’s usual 90% grant share since FAA has indicated they may be reluctant to fund projects that result from the County’s placement of the landfills.

Link to KPBS article

Posted by on Oct 11, 2018 in Jim's Take on the Market, Local Flavor, Local Government | 7 comments