Source:  Curbed

Multi-generational living, when more than one generation lives under one roof (not counting young children or teens), has hit record levels in the U.S.

Growing life expectancy, changing immigration patterns, and affordability issues all contributing to the increase and developers and architects are scrambling to respond. 

Making Sense of the Story:

- In 2014, according to Pew Research Center data, 60.6 million people, or 19 percent of the U.S. population, lived in multi-generational homes, including 26.9 million three-generation households.

- That's up from a 1980 low point, when the rate was 12 percent.  It's nearly a return to the 1950 rate of 21 percent.

- The nation's growing and increasingly diverse immigrant population plays a big role in the shift.  In 2014, 28 percent of Asian and 25 percent of Hispanic households were multi-generational, both up from five years prior - and a significant jump from the rate found in white households, just 15 percent.

- A report by the Harvard Joint Center for Housing Studies, the number of Americans over 80 will double, from 6 million, in the next two decades.  And by 2035, one out of three U.S. households will be headed by someone over 65.

- A 2016 survey found that 44 percent of home shoppers in a group of 20,000 hoped to accommodate their elderly parents, and 42 percent planned to accommodate their adult children.

Source:  The Orange County Register

Eight Orange County Zip codes are among the Top 100 most expensive in the nation based on 2017 home sales, says real estate website Property Shark.

The priciest Orange County ZIP is Newport Coast's 92657, at number 12, with a median sale price of $2.95 million.
That ZIP saw the highest single home sale on the Multiple Listing Service in O.C. this year, when an estate located on nearly 12.5 acres with an asking price of $55 million sold for $39,999,999.

The top three spots in the U.S. are ZIP codes in California, New York, and Florida.
Atherton's 94027 is in the Silicon Valley, Manhattan's 10013 is lined with TriBeCa' luxe condos, and 33109 in Miami Beach's Fisher Island is an exclusive island community.  California captured the highest number of ZIPs in the ranking - 77.  The list of closed residential property sales includes single-family, condos and co-op units.

Source:  CNBC

Confidence among the nation's homebuilders jumped unexpectedly in December on expectations for a stronger economy.

A monthly reading of homebuilder sentiment rose 5 points to 74.  This is the highest reading since 1999.  Fifty is the line between positive and negative sentiment on the National Association of Home Builders' index.

November's reading was revised lower by 1 point.  Sentiment stood at 69 in December 2016.
"Housing market conditions are improving partially because of new policies aimed at providing regulatory relief to the business community," said NAHB Chairman Granger MacDonald, a homebuilder and developer from Kerrville, Texas.

Homebuilders had been vehemently opposed to the Republican tax plan, which is set for a final vote in Congress this week.

Changes to both the mortgage interest deduction and property tax deductions were seen as removing some of the benefits of homeownership.  Apparently, builders now see the business incentives in the plan as outweighing those other negatives.

Source:  The Los Angeles Times

The Republican tax bill reduces the ability of home buyers to deduct mortgage interest, which will be a hit to home shoppers in Southern California and the Bay Area, where housing costs are sky-high.
But the interest provision is far more limited in scope than a previous proposal.  Real estate experts and professionals said that they don't expect a big effect on home buying in the region, and that any ramifications will be largely restricted to well-to-do neighborhoods.

Making Sense of this Story:

- Under the new plan, which passed the House on Tuesday and was headed for a late vote in the Senate, buyers can deduct interest on mortgages up to $750,000, for homes bought after Dec. 15.  (Homes purchased on that date or before then aren't affected.)  That's down from the current $1-million limit, but an increase from a $500,000 cap that previously passed the House.

- That means a home buyer with a 20 percent down payment can purchase a $930,000 home and still deduct all the interest.  Even for a borrower who took out a $1-million loan at 4 percent interest, $30,024 of interest payments are deductible in the first year, leaving $9,656 that isn't.

- The bill also caps properly and state income tax deductions at a combined $10,000 - about $8,500 less than the average deduction taken by Californians in 2015, according to the Tax Policy Center.  Combined with the new cap on mortgage interest deductions, that could mean some households will have less to spend on housing, leading to price declines in some wealthy areas.

- The tax bill doubles the standard deduction, which means fewer households will itemize.  That may result in people buying a less expensive house because they couldn't write off any interest.

- Some experts predict that by adding an estimated $1.5 trillion to the federal budget deficit over 10 years, the tax bill will put upward pressure on interest rates - including mortgage rates, which have remained under 5 percent for the last six years.

Recycling is the norm in most communities today.  You probably want to make more of an effort to protect the environment beyond recycling.  Here are a few methods to implement to save the planet in effective, yet - convenient ways:

1.  Go "Green" with Your Coffee
Brew a cup of certified organic coffee that is grown under sustainable conditions.  If you use a "pod" type of coffee maker, buy reusable pods.  This will help you save money as well.  If you prefer your local coffee shop, take your own cup - not only will you eliminate waste, you might get a discount.

2.  Switch From Paper Napkins and Towels to Cloth
A modest investment, these will last for years and add a touch of elegance to everyday dinners.  Keep a stash of microfiber cloths handy and use them for mopping up spills or cleaning windows and the bathroom instead of paper towels.  And linen towels will do a better job of drying your dishes than paper ones.

3.  Practice Conservation in Your Closet
By creating a "capsule" wardrobe of fewer but higher quality pieces, you'll feel like you have more clothing and will avoid wasting money on cheaper garments you'd throw away.  When you clean out your closet, donate to a charity or a shelter in need.  Some companies recycle used t-shirts or treadless athletic shoes to create new products.  Finally, return dry-cleaning hangers, so they can be reused.

Simple tips like these can create a happier, healthier and more valuable home.  Thank you for thinking of "Real Estate Culture" for all of your real estate needs, and be sure to share our contact information with anyone you know of looking to buy, sell or invest in a home.

Felicia Jones, Realtor
Keller Williams Realty, BRE# 01977033
Email:  homesbyfelicia@kwrealty.com

Source:  HousingWire

Pending home sales inched up slightly in November and in December, according to a release from the National Association of REALTORS.

But even as home sales increase at the end of 2017, headed into 2018, NAR forecasts existing home sales and home price growth will slow primarily due to the altered tax benefits of homeownership in some high cost areas.

The Pending Home Sales Index, a forward-looking indicator based on contract signings, increased 0.2 percent to 109.5 in November, up from 109.3 in October.

This modest increase means the index remains at its highest reading since June, and is up 0.8 percent from last year.

"All of the leading indicators of housing activity, pending home sales, purchase applications from the MBA's mortgage applications survey, and the National Association of Homebuilder's housing market index, have pointed higher in recent months, suggesting that home sales ended the year on a high note," Nationwide Chief Economist David Berson said.

Source:  The Mercury News

Three out of four potential home-buyers responding to a recent online survey said the newly passed GOP tax overhaul will alter their plans to buy a home, according to a poll by Realtor.com.

Nearly 30 percent said they plan to speed up their home purchase, with 31 percent saying they'll postpone a purchase, the survey showed.

Twenty-six percent said they either will buy a less expensive home or buy in a different location.

Just 23 percent said the tax bill will not change their plans to buy a home.  On the seller side, most said the tax bill won't affect them.

Fifty-seven percent said the new tax law will have no impact on plans to sell their home.

Congress voted to send the bill to President Donald Trump for his signature.  The findings are based on a survey of 2,324 randomly selected respondents surveyed.

Almost a fourth of those surveyed said they had planned to buy a home in the next year, while just over a fifth said they're planning to sell their home in the next year.

Source:  The Orange County Register

The new Republican tax overhaul will likely chop plans for thousands of new affordable homes in California and further squeeze low-income renters, but experts say the impact could have been more severe.

The tax law, signed by President Donald Trump, preserved two threatened federal programs that are key to building tens of thousands of affordable homes in California - low-income housing tax credits and tax-exempt private activity bonds.

But experts estimate the new tax rules could still reduce federal funding for subsidized housing in the state by 20 percent, translating to roughly $500 million a year of projects and 4,000 new units lost.

"The worst possible hits were taken out of the bill," said Carolina Reid, assistant professor of city and regional planning at UC Berkeley.

But, she added, "It does nothing to actually promote affordable housing."

Advocates say the need for affordable housing has become more visible and urgent, as Bay Area residents priced out of expensive apartments turn to alternatives - from sharing crowded houses and apartments with family, friends and strangers, to living in vehicles and RVs.

Source:  CNBC

In 2014, San Francisco passed legislation allowing property owners to add accessory dwelling units, or ADUs, to their homes and buildings.

The law was then expanded in late 2016 so that any building with at least five existing apartments could add an unlimited number of units, the San Francisco Chronicle reports.

As property owners take advantage of the new law, the city has seen an explosion of ADUs over the past year.

"There are now 1,046 ADUs in the pipelilne, with building permits approved for 531 of them," according to the Chronicle.

These units, often called "granny flats," typically consist of converted garages or basements.

"Pretty much every multi-unit building with crappy old storage rooms is taking a look at this," John Pollard of the SF Garage Co. told the Chronicle.

"You've got all these property owners that realize they are sitting on dead equity."  That means everything from a boiler room to basement storage has the potential to become a new housing unit.

One landlord in San Francisco's Nob-Hill neighborhood is turning a ground-floor dining hall into seven individual units, the Chronicle reports.  The apartments will be between 220 and 381 square feet and cost anywhere from $2,400 to $2,800 a month.

Source:  The New York Times

The Internal Revenue Service has a message for the homeowners rushing to prepay their property taxes:  Not so fast.

The tax bill that President Trump signed into law sharply limited the itemized deductions for state and local taxes while raising the standard deduction for individuals and couples.  The rules take effect this year (2018).  That has led some homeowners, particularly in high-tax affluent areas, to try to prepay their 2018 property taxes before the deduction disappears.

Making Sense of the Story:
- In an advisory notice posted to its website, the I.R.S. said that maneuver could work, but only under limited circumstances.

- To qualify for the deduction, property taxes not only need to be paid in 2017, they must also be assessed in 2017 - meaning that homeowners who prepaid their taxes based on estimated assessments, or who tried to pay several years' worth of taxes at once, will probably be out of luck.

- It is not clear how many people have tried to prepay their taxes.  In Fairfax, Va., hundreds of people lined up to prepay taxes on Tuesday, according to local media reports, and communities in New York, New Jersey and other states have likewise reported a rush of prepayments.

- The I.R.S. guidance is advice to taxpayers and tax-preparers, not a legal ruling.  And the agency did not define what it means for a tax to be "assessed."

- Property tax schedules vary widely from state to state and even county to county.  Some states have already sent out tax assessments for part of 2018, even if the payments are not due until next year.  In those states, tax lawyers said, homeowners who prepay taxes will almost certainly be able to deduct their taxes under the 2017 rules.

- Other states have not even begun the 2018 assessment process.  In those states, prepayment almost certainly will not help taxpayers.