Americans stepped back from buying new homes in January, as purchases plunged sharply in western states where prices are typically higher

New-home sales tumble in January on big decline in West

WASHINGTON – Americans stepped back from buying new homes in January, as purchases plunged sharply in western states where prices are typically higher.

The Commerce Department said Wednesday that new-home sales fell 9.2% last month to a seasonally adjusted annual rate of 494,000. Most of the decline stemmed for a 32.1% in sales in the West. Sales also slipped in the Midwest, while edging up in the Northeast and South.

The pace of buying new homes last month slipped below last year’s sales total of 501,000, a possible sign of mounting price pressures despite low mortgage rates and job gains that have pushed the unemployment rate down to 4.9%. But new-home sales also tend to be a volatile government report with revisions and large swings on a monthly basis.

The decrease complicates the outlook for residential real estate. Rising demand for existing homes had sparked hopes that builders will ramp up construction and sales of new homes will accelerate. The 14.5% increase in new-home sales last year fed into those expectations. But builders have increasingly focused on the more affluent slivers of the market, while the decline in sales listings of existing homes indicate that many Americans may have lost interest in upgrading to a new property.

A curious price gap appears to have opened up because of these trends. The median new-home sales price fell 4.5% from a year ago to $278,800, likely because of fewer purchases in the West. But the average price — which includes the extremes of the market — has climbed 2.7% from a year ago to $365,700, a difference of nearly $100,000 compared to the median. The increase in the average price has consistently stayed ahead of wage growth, which limits affordability.

New-home sales still lag the historic 52-year average of 655,200. Subprime mortgages helped push up sales as high as 1.28 million in 2005, a peak that ultimately signaled a bubble that burst and pushed the economy into its worst downturn since the depression.

But demand for housing has recovered over the course of the 6 ½-year recovery from the recession.

Sales of existing homes rose 0.4% last month to a seasonally adjusted annual rate of 5.47 million, the National Association of Realtors said Tuesday. That increase comes on the heels of a strong 2015 when sales reached their highest level in nine years. Supply of homes has failed to increase in response to demand, causing the median sales price to rise 8.2 percent from a year ago to $213,800.

The rising prices have raised questions as to whether construction firms will build more homes to fulfill demand.

Housing starts dipped in January amid colder weather. Ground breakings fell 3.8% last month to a seasonally adjusted annual rate of 1.1 million homes, the Commerce Department said in a separate report. But for all of 2015, housing starts totaled 1.1 million, the most since 2007.

Homebuilders see room for further expansion, yet they’re slightly less hopeful.

The National Association of Home Builders/Wells Fargo builder sentiment index dropped to 58 in February, a decrease of three points from January. The index had stayed in the low 60s since June. Readings above 50 indicate more builders view sales conditions as positive.

https://www.usatoday.com/story/money/business/2016/02/24/new-home-sales-housing-market/80849626/

I recently received notification from the City of Newport Beach California that our sewer tax is set to increase 103% in the next five years

Newport Beach, California –

Help Me Stop the 103% Sewer Tax Hike!

Dear Friend,

I recently received notification from the City of Newport Beach California that our sewer tax is set to increase 103% in the next five years.

You can read the notification here.

https://residentsforreform.com/notice.pdf

We are told that the sewer fund will be broke in the next 18 months unless the rate increase is implemented. Really?

Over the past 10 years our city’s budget has increased by 52%, growing from $187 million in 2005 to $285 million in 2015.

Over ten years these Mayors bankrupted the sewer system while adding $100 million to the budget.

The old city council added $100 million to the budget with little to show for it.

The politicians and bureaucrats have spent years telling us what good fiscal stewards they are.

The prior council bragged about amassing a $120 million surplus while our sewer pipes deteriorated.

Former Mayor Rush Hill waived $2 million in permit fees in 2014 as part of his “Newport Dividend.” Councilman Curry has bragged about his “Facilities Improvement Financing Plan” for years.

They spent $225,000 on bunnies and $1,000 on desk chairs at the Taj Mahal. I guess the sewer system wasn’t as exciting.

Now we are told that our Sewer Fund will be broke next year if we don’t agree to the 103% increase in sewer rates.

They promised us the 2005 increase was good for 20 years, and reaffirmed in the 2009 Sewer Master Plan. You can read it here.

It appears the old council’s priority was the $142 million Taj Mahal and Taj Mahal II ($35 million Marina Park) – not our sewer pipes. Shiny new objects were more important than the mundane sewer system.

Now I am told they are proposing a new community center for West Newport – near the Costa Mesa border. Located just 2 ½ miles from the Peninsula’s Taj Mahal II do we really need to spend another $25 million on a shiny object while our sewer fund goes broke?

I am angry. The fundamental job of city government is the maintenance of our infrastructure, not building shiny new objects to satisfy political egos.

I want to launch a campaign to kill the sewer tax hike. Will you join me?

Sincerely,

Bob McCaffrey
Volunteer Chairman, Residents for Reform

https://residentsforreform.com/

Scenes of wrecked and submerged neighborhoods in the aftermath of Sandy, the East Coast superstorm, are unlikely to be repeated in Orange County anytime soon

Editorial –

O.C. flooding – What could happen here – Could the District at Tustin Legacy be Under Water – Literally and Financially –

Scenes of wrecked and submerged neighborhoods in the aftermath of Sandy, the East Coast superstorm, are unlikely to be repeated in Orange County anytime soon.

But something very like it happened in 1938. Days of rain dropped more than 9 inches over Orange County, more farther inland, turning much of northern Orange County into a lake as the Santa Ana River overflowed its banks.

The flood claimed at least 19 lives, left 2,000 homeless and yielded memorable black-and-white photos of drowning cars and buildings in Anaheim.

Something very like it also happened in December 2010. More than 9 inches of rain fell over 12 days in Orange County – enough for a 1938-style catastrophe. But the widespread devastation didn’t happen this time.

The difference comes down to human engineering. The 1938 flood prompted construction of Prado Dam above Orange County on the Santa Ana River, and the concrete channelization of riverbeds across Southern California.

Sealing riverbanks in concrete speeds storm flow on its way to the ocean, depriving us of the chance to capture some water, perhaps, but preventing catastrophic flooding.

“As much as everybody complains about concreting rivers, if we hadn’t done that, we would have had 1938 déja vu all over again,” said Bill Patzert, an ocean and climate researcher at the Jet Propulsion Laboratory in Pasadena. “We’re somewhat immunized against floods.”

Somewhat, however, does not mean completely. More localized flooding remains a genuine threat in Orange County.

And while the chances of a city-swallowing deluge are far lower because of flood control, they aren’t completely out of the question.

A 190-year storm – one that would be expected statistically once every 190 years – could wreak similar havoc even with present flood control measures, said Tom Bucklew of the U.S. Army Corps of Engineers, project manager for the Santa Ana Mainstem Project.

With a total estimated pricetag of $2.1 billion, the project so far has included a variety of improvements along the Santa Ana River, the raising of Prado Dam and the building of the Seven Oaks Dam near the river’s headwaters in San Bernardino County.

The goal is to provide Orange County with 190-year flood protection. At the moment, we have 70-year flood protection.

“There are still hundreds of millions of dollars needed to complete the project,” said Kevin Onuma, manager of Orange County’s OC Flood section.

The remaining work includes improvements around Prado Dam.

“It wouldn’t be something we have to do tomorrow,” Bucklew said. “But within the next few years, we want to make sure we finish the project.”

In our case, the culprit behind a massive downpour is unlikely to be a hurricane. While we sometimes experience the backwash from weakened remnants of Pacific hurricanes, in the form of heavy rains, the chance of the hurricanes themselves reaching this far north are close to zero.

A churning hurricane must be powered by warm water.

“We have a very cold California current, called a hurricane vaccine,” Patzert said.

Instead, the big threat to Southern California would come in the form of an “atmospheric river,” sometimes called the Pineapple Express.

That is when a chain of storms, one behind another, flow over the region from the Pacific.

The 1938 deluge might have been one such atmospheric river; the downpour in 2010 definitely fit the bill.

“Two things allowed us to have 20 million people – headed for 30 million, by the way – in Southern California,” Patzert said. “One was water infrastructure, the other was flood control infrastructure. Without all that concrete and all those pumping stations, most of us wouldn’t be here.”

Contact the writer: 714-796-7865 or [email protected].

https://www.ocregister.com/articles/county-376599-flood-orange.html

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