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Home of Tomorrow

In 2021, how many garages have 2-3 cars parked inside? We should change the name from garage to ‘flex space’, or ‘California basement’. Hat tip to my friend Ken:

JBREC was pleased to be asked to be part of a team assembled by Pro Builder Magazine to collaborate on a concept home for their “Immersive Show Village”  that was highlighted last week at IBSx and is available to tour all year long.  The home was dubbed “The New New Home” and JBREC’s research, in collaboration with Pro Builder and Woodley Architecture Group helped form the vision.

Link to ProBuilder digital magazine

Over the past year, the pandemic provided the opportunity for us to examine how people live now and how they will be living in the future. The team considered the functionality of the entire house from the front to the garage, outdoor spaces, and casitas. The following provides a glimpse into the research.

  • A 2,500-square-foot home that is right-sized for the family. The team chose to challenge itself by designing a home on a typical lot that is readily available throughout the country. The profile is a family with two children (around 9 and 12) with parents working from home and children attending school from home. Selfishly, this describes Ken’s family so we had a little bit of a head start.
  • A need for privacy. The New New Home was designed to look inward instead of toward the street with an interior courtyard rather than a larger front porch. This layout offers a private retreat while connecting almost every room on the lower floor to the outdoors. The courtyard also provides a safe place to drop off packages just inside the front gate.
  • Will we always need a two-car garage? Maybe not. While the home’s design highlighted a two-car garage, it included a single-car option to inspire and ask “what if?” In a future where we rely less on cars, the flexibility to offer a single car garage creates the opportunity for extra square footage, building in options to suit the preferences of different owners. The single-car option still allows for storage space in the garage and opens the possibility for more entertaining space in the courtyard.
  • A casita for multifunctional space. While the main house stays under 2,500 square feet, the guest house adds livable space. This multifunctional room could work as a guest quarters or multigenerational suite for extended family, whether a parent or a boomerang child who graduated college but is not ready to start their career. In the July 10, 2020 edition of The Light, we noted that more than 1.1 million 23-to-30-year-olds had moved “back home” since February. The casita could also function as a home office that is separate from the house.
  • A large, functional backyard. When asked to choose between a large backyard and a larger front yard, homeowners indicated the backyard was more important. The New New Home offers a private courtyard and a nicely sized backyard. The yard is large enough to include outdoor seating areas, a space to garden, an outdoor kitchen, and includes a covered outdoor room with transition space between the great room and the backyard.
  • A simple and open kitchen layout with all of the appliances along one wall is supported by a spacious island providing space for the kitchen sink and informal dining. Storage is important, and while this home doesn’t have a walk-in pantry, a run of cabinetry between a “clean room” (designed as a healthy transition space from the outside) and kitchen takes the place of the walk-in setup.
  • Multiple spots to accommodate working from home. JBREC’s consumer research found that 60% of households earning $50K+ who are working from home right now anticipate continuing to work from home at least part-time post COVID. The New New home includes two work spaces located on separate floors. Both offices were designed to incorporate lots of light, while considering the background behind the workspace. The offices have smaller dimensions to accommodate a built-in desk and storage but no space for clients “sitting across” from the worker.
  • Your kids live at home too! Our August 14 edition of The Light highlighted the need for spaces dedicated to remote learning as more than 4.0 million students were impacted by school closures. This home was designed to accommodate a growing family with the children’s “wing” featuring two secondary bedrooms that share a bath, and a layout that maximizes separation between the kids’ wing and the primary suite. The children’s bedroom provides space for separate study or remote learning areas.

Our New Home Trends Institute, our consumer research, and our constant “on-the-ground” consulting work continues to help inform our knowledge of how people live and how their homes are evolving. Let us show you how to implement these strategies into your next new home community.

Ken Perlman

If you have any questions, please contact Ken Perlman, Managing Principal, at (858) 281-7214 or kperlman@realestateconsulting.com.

https://www.realestateconsulting.com/

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Here’s Rick’s forecast of 15% appreciation for 2021, and another 15% for 2022-2024:

Migrating….Close to Home

Hat tip to just some guy for sending this news which shows that while migration has increased, many are opting to stay closer to home:

San Francisco’s chief economist, Ted Egan, said that while the out-migration patterns are alarming — only Manhattan has had as large an increase in people leaving the city during the pandemic — the fact that many are not going very far could represent “a silver lining” as the economy recovers post-pandemic.

“You are not going to have to worry about getting them to move back from Boise,” he said. “It looks more like normal pre-COVID migration flows. People are settling into nearby Bay Area suburbs. They are going to Sacramento and L.A. Travis County, which is Austin, Texas, is way down the list. Portland is way down the list. New York is way down the list.”

Maybe it means that our 55+ crowd may grab their old property-tax basis and just move a little further out after April 1st?  We only need a few hundred of them to do so!

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NSDCC Listings, February 1-15

Are we getting any more inventory? Are more homes coming to market?

There have been a few more good listings, which gives hope. The Super Bowl being on February 7th was later than usual, but the overall numbers are still very light:

NSDCC New Listings Between Feb 1 – Feb 15

Year
Total Number of Listings
Median List Price
Number Under $2M
Total Sold
% Sold
2019
207
$1,650,000
135
132
64%
2020
208
$1,731,500
126
121
58%
2021
140
$1,776,500
85
?
?

The 2021 count will climb a bit higher, but it’s safe to say that we are still well behind where we usually are.

If we end up around 165 listings, and the percentage sold improves to 70%, it would equal 116 sales which is close to the 2020 total.

If all we are missing are the casual sellers that wouldn’t have sold anyway, are we any worse off?

Not really – and the market would be more efficient if we’re just left with the serious players all around.

Billie Joe Armstrong

Here’s a good marker on age – Billie Joe Armstrong is 49 years old today!

My fellow Oakland-born rebel has been around since 1988, and the band was inducted into the Rock and Roll Hall of Fame on their first ballot in 2015.

I saw Green Day in Chula Vista with Laker Joe, and they were incredible – never forget:

Fixer

Here it is, literally the worst house on the street! The Seller has done the hard work of cleaning up the almost half-acre property (it only took 7 dumpsters!), so now is your chance to take it from here.

Have you ever watched HGTV and thought, “I could do that!”? If so, pack up your tape measure and start Googling how to identify a load-bearing wall because it’s time to put your money where your mouth is!

The roof leaks, the floor creaks, and there’s a terrible draft, but this 3 bed, 1.5 bath home is very open concept. And by that we mean the inside is open to the outside because several of the windows are broken. There is a large, sunny window in the kitchen… and absolutely nothing else – a wonderful feature for someone interested in a bright reading space (and ordering take out for every meal).

Now I know you’ve heard of a detached garage, but have you ever heard of a detached foundation?! Because that’s what you’ll find here in the large bonus room at the right of the home. And if you’re looking for a house that screams “I’ve got bizarre and ominous energy!” then honey stop the car because you’ve found it right here conveniently located off of US-301 in North Zephyrhills.

If you need a place to stage your next post-apocalyptic zombie movie, this is it (the covered porch has really good “rest here on your way to the safe zone” vibes). And whether you like to turn up the heat or keep it cool, it won’t matter here because there is no HVAC system. Oh and don’t forget about the brick chimney that perfectly epitomizes how we all feel after 2020 – about to collapse and going nowhere (literally, there is no fireplace inside the house).

What else can be say about this one-of-a-kind opportunity? It’s not in a flood zone and will be conveyed with clear title! But we don’t have a survey and the Seller has never seen the property, so buyers are strongly encouraged to do their own due diligence. And if you’re not interested in crying yourself to sleep every night while you rehab this home, might we suggest tearing it down and building a brand new one in its place? The neighbors would likely thank you.

$69,000

https://www.zillow.com/homedetails/37913-Avoca-Ave-Zephyrhills-FL-33541/46436152_zpid/

Rates Take A Beating

If you are thinking of selling your house this summer, expedite your plans!

Volatility has returned to the mortgage market in grand fashion this week with many lenders quoting rates that are as much as a quarter of a point higher than they were last week.  That means if you were looking at something in the 2.75% neighborhood on Friday, it could be 3.0% today. What gives?

The upward pressure is nothing new, really.  It has existed in the broader bond market since August, but only recently began spilling over to the mortgage market.  We’ve been discussing the increased risks of such a spillover in the event of a sharper bond market move and yesterday brought just such a move.  Today was much more docile by comparison, but it didn’t do anything heroic to push back against yesterday’s weakness.

Still, there could be some promise of stability in the fact that the bond market was even able to hold steady today.  Reason being: economic data and other events clearly suggested another bad day for bonds.  Retail Sales surged at one of the best paces on record and inflation rose abruptly at the producer level.  Both of those headlines make strong cases for higher rates, but Treasury yields ended the day slightly LOWER than yesterday.  That sort of resilience may be a clue that bonds have had enoughweakness for now (bond weakness = higher rates, all other things being equal).

Mortgage lenders are WIDELY stratified in terms of rate offerings with the more aggressive crowd averaging 2.875% (no points) on top tier 30yr fixed refinances and the less aggressive crowd being closer to 3.125% (conventional 30yr fixed).

Link to Article

Sprucing Up to Sell

Homeowners fixing up their homes to list this spring will have to decide where to put their time and money to get the most bang for their buck. Zillow has been there, and the practical tips and tricks their experts have learned after selling 10,000 homes could help you sell yours.

Zillow-owned homes, acquired through Zillow Offers in 25 markets nationwide, are carefully evaluated, repaired and cleaned before they hit the market. Zillow invests in the projects that make a home safe, clean and functional, and each time learns more about what appeals to buyers. By sharing these tips, Zillow hopes to help all sellers prioritize their home prep projects.

Pick the Perfect Paint Color

Painting is one project nearly all sellers take on before putting their home on the market. It is an affordable home improvement project that has a high return on investment. But when you’re thinking about resale, you’ll want to be strategic about the colors you select.

When Zillow needs to freshen up the walls before listing a home for sale, it uses Behr Premium Plus paint in either Aged BeigeCampfire Ash or Polar Bear. Neutral greige or taupe paint colors appeal to the widest group of buyers and don’t distract from a home’s best features.

Fix your Faucets and Fixtures

The two most common items Zillow repairs or replaces before listing a home for sale are faucets and light fixtures. A buyer may jump to the conclusion that a leaky faucet is a sign there may be water damage, while a broken fixture could inaccurately signal potential electrical problems. Either can suggest a home hasn’t been generally well-maintained.

These are both DIY-friendly fixes that could boost your home’s value. If you’d rather hire a professional, a Zillow and Thumbtack report finds you can expect to pay, on average, $205 to replace a faucet and $380 to replace a light fixture.

Clean the Carpet

A clean carpet is critical if you want your home to make a great first impression. Steam cleaning will often do the trick, but if your carpet is torn or has permanent stains, you’ll want to replace it.

Zillow uses Mohawk brand carpet in either Charger Classic or Scout Highgate. Selecting a high-performing, stain-resistant carpet in a neutral taupe color will appeal to the most buyers and add value to your home.

Sweat the Small Stuff

Zillow takes care of all the items that make life easier for the home’s next owner. These items include landscaping, servicing the HVAC system, and replacing all light bulbs and batteries in smoke and carbon monoxide detectors.

By taking care of these items before putting your home on the market, you can boost curb appeal and give a potential buyer confidence that your home has been well-maintained.

Say No to a Full Reno

Home improvement TV shows often suggest you need a gut renovation to get top dollar in resale. However, Zillow research finds big renovation projects hardly ever pay for themselves when it comes time to sell, with a few exceptions.

Zillow rarely completes any major upgrade to a home that would dramatically alter its footprint or its value. Instead, Zillow focuses on the projects that make a home clean, safe and functional for a buyer, repairing items instead of replacing them when possible.

“Buyers often want to put their own stamp on a home and have it reflect their taste,” says Lindsey DellaSala, a broker with the DJ and Lindsey Team in Jacksonville, FL. “Let’s say you decide to upgrade your backsplash before selling. The trendy statement tile you love may not be what a buyer is looking for, and that could hurt, rather than help, your chances for a speedy sale.”

“When a buyer walks into a Zillow-owned home, they know it is move-in ready and they can add their personal touches over time,” says Claire Caldwell, Senior Director of Renovations at Zillow. “By creating that same kind of blank canvas in a safe and clean home, you can help buyers better envision their lives there.”

Embrace Tech

Online curb appeal is more important than ever, as most home shopping has gone virtual. Zillow-owned homes are listed for sale with professional photography, a floor plan with dimensions and a virtual 3D Home tour that gives shoppers an immersive experience of a home from the safety and comfort of their own living room.

Sellers can harness the power of tech to showcase their home’s best features by using the free 3D Home app to create a virtual tour, and explore other digital tools such as virtual staging.

(JtR: Big difference between ‘high-tech’ and robotic, which is the sales method they are pushing)

Link to Article

Mortgage-Rate Bump

A simple one-day surge will only cause the few buyers who have a property right in front of them to hurry up and buy it.  If rates continue into the 3s, it will affect everybody.

Recovery prospects, renewed focus on stimulus, inflation concerns, a brighter covid outlook, etc…  All of these are reasons for an ongoing, gradual trend toward higher rates in 2021 (i.e. general bond market weakness) but none of them really explain why the bond market had its worst day in months today specifically.  Still, pundits are pointing to the laundry list of usual suspects to explain the move.  In their defense, that’s all anyone can really do on a day like today.  At a certain point market momentum becomes its own justification and bond prices snowball to lower and lower levels.

When bond prices fall, rates rise–a fact which is abundantly clear in comparing today’s rates to those seen late last week.  The average lender is quoting conventional 30yr fixed rates that are roughly 1/8th of a percent higher, and that’s a huge move for a single trading day.

http://www.mortgagenewsdaily.com/consumer_rates/967718.aspx

The National Housing Squeeze

Good article from the wsj:

Statistically speaking, Idaho is one of America’s greatest economic success stories. The state has low unemployment and high income growth. It has expanded education spending while managing to shore up budget reserves. Brad Little, the state’s Republican governor, has attributed this run of prosperity to the mix of low taxes and minimal regulation that conservatives call “the business climate.”

But there is another factor at play: Californians, fleeing high home prices, are moving to Idaho in droves. For the past several years, Idaho has been one of the fastest-growing states, with the largest share of new residents coming from California. This fact can be illustrated with census data, moving vans — or resentment.

Home prices rose 20 percent in 2020, according to Zillow, and in Boise, “Go Back to California” graffiti has been sprayed along the highways. The last election cycle was a referendum on growth and housing, and included a fringe mayoral candidate who campaigned on a promise to keep Californians out. The dichotomy between growth and its discontents has fused the city’s politics and collective consciousness with a question that city leaders around the country were asking even before the pandemic and remote work trends accelerated relocation: Is it possible to import California’s growth without also importing its housing problems?

“I can’t point to a city that has done it right,” said Lauren McLean, Boise’s Democratic mayor.

That’s because as bad as California’s affordable housing problem is, it isn’t really a California problem. It is a national one. From rising homelessness to anti-development sentiment to frustration among middle-class workers who’ve been locked out of the housing market, the same set of housing issues has bubbled up in cities across the country. They’ve already visited BoiseNashvilleDenver and Austin, Texas, and many other high-growth cities. And they will become even more widespread as remote workers move around.

Housing costs are relative, of course, so anyone leaving Los Angeles or San Francisco will find almost any other city to have a bountiful selection of homes that seem unbelievably large and cheap. But for those tethered to the local economy, the influx of wealthier outsiders pushes housing costs further out of reach.

Link to Full Article

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