Did you know?
Good morning,
DID YOU KNOW?
* The S&P CoreLogic Case-Shiller National Home Price Index, which measures home prices across the nation, fell 0.2% in April, compared with a 0.7% annual growth rate the prior month. Prices are now just 2.4% below their June 2022 peak.....which would imply DEFLATION. The Case-Shiller index, which measures repeat-sales data, reports on a two-month delay and reflects a three-month moving average. Homes usually go under contract a month or two before they close, so the April data is based on purchase decisions made early this year or late last year. Important to note how we are almost in July and the FED is looking at data from APRIL! Meanwhile, sales of newly built single family-homes were at a seasonally adjusted rate of 763,000 during May 2023 — 20% higher than the levels seen in May 2022, according to data from the US Census Bureau. (CNBC)
* Air Conditioners cool homes, while heating everything outside....Growing middle classes in countries such as India are expected to lift the number of ACs in use to roughly 5.5 billion by 2050 from about 2 billion today, the International Energy Agency estimates. New technologies are being worked on now to make AC's much more efficient. Separating the cooling and dehumidification functions may be a solution. (WSJ)
* If you want to think of where the BIG money is flowing, always look out for the toys of the super-rich.....yachts have to be the most expensive of all these rewards for riches. Monaco, Cannes, St. Tropez, Portofino, Dubai, The Bahamas, come to mind, but FLORIDA is seeing the biggest demand for big-big docks for huge yachts. Annual U.S. sales of boats, marine products and services totaled over $56 billion in 2021, up 12.7% from 2020. There are roughly 592,000 'yachts' in the US, but fewer than 200 superyachts, those above 80ft in length. Maintenance/operating costs run between 10-20% of the cost of a yacht.....annually!
* Fraudsters potentially stole more than $200 billion in federal loans intended to help small businesses struggling during the Covid pandemic, according to The Office of the Inspector General who estimated in a new report that at least 17% of the $1.2 trillion disbursed by the Small Business Administration may have been ripped off by fraudulent actors. That's almost $1,200 per taxpayer.... Inefficient government costs lots! (CNBC)
* While the world remains obsessed with Miami and Palm Beach, on the other side of Florida on the Gulf Coast, Naples has become a destination in super-high demand with home prices soaring. This beautiful area is quite gorgeous and worthy of closer inspection. I have visited multiple times and loved it! So too does the Wall Street Journal who just featured the Naples area a HUGE article!
COMPASSin-the-news
*** Tons of press for COMPASS Texas here. Featured are COMPASS Houston's Laura Sweeney, Dee Dee Guggenheim Howes, Coley Lumley, Albert Cantu, Melissa King and Courtney Robertson, COMPASS Dallas' John Weber, Jillian Ihloff, and Michelle Wood. CONGRATULATIONS ALL!
***WALL STREET JOURNAL: Alex Buljan of COMPASS Hillsborough, CA is listing the WHITE HOUSE.....no not that one, the other one....for $38.9 million!
***THE REAL DEAL: COMPASS super-team press coverage from Northern California with COMPASS agents galore!
COMPASStip-of-the-day
A somewhat un-sexy feature of a home may lie in its infrastructure, but may also be the most valuable item to prospective buyers. Extreme insulation (for energy cost savings), soundproof windows or insulation, a heated driveway, a fire-proof roof, additional steel structure for storm resilience, etc may be unseen attributes not as impressive as a gold plated faucet, but they are worth identifying and noting. Some may attach greater value to these items than anything!
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27.5 Years
The IRS says that the “useful life” of a home’s improvements is 27.5 years. This figure is used to calculate the value of depreciation mostly related to investment real estate, but its a number worth noting for other reasons. The average US homeowner lives in their home around half this timespan: As of 2018, the median duration of homeownership in the U.S. is 13 years. Median tenure has increased by 3 years since 2008 and as mortgage interest rates are higher, I bet that's rising. In the New York-Newark-Jersey City, NY-NJ-PA area the typical homeowner stayed for around 15 years....as is the case in the Los Angeles-Long Beach-Anaheim, CA area.
These days I am seeing an alarming trend whereby many people VIEW properties 7 years and older as 'old'....maybe a product of our HGTV obsession? It is often even more extreme amongst the wealthy whose eyes are glued to the latest and greatest interiors in Architectural Digest and other media outlets. Mostly this is related to finish out, not systems. We all have a lifespan....its nature: AC units typically last about 15-20 years, as do boilers and windows. Roofs can last longer depending on type and location. Shingle siding lasts about 20 years and painted exteriors should be repainted within 10 years. All this may help explain why the IRS sees the length of a home's 'useful life' at 27.5 years, a timeline mostly related to depreciation.
The median age of a US home is about 39 years.....how much cosmetic and structural work is required over time depends largely on the quality of construction and the location of the home, specifically its exposure to harsher climates. At least 58 million US homes are older than 20 years of age. When buying or selling a home, a detailed evaluation of condition is invaluable. Often things that appear dated or at 'end of life' are not, and vise versa. When representing a seller, great condition needs to be broadcast loudly....it has real value to buyers. Upgrading things beyond cosmetics - even at significant expense - can have enormous value in a market where buyers simply don't want to do work and seek instant gratification.....and are willing to pay the premium, and then some!
Have a WONDROUS Wednesday!
Regards,
Leonard