Election live blog: California gas tax repeal, rent control measures trailing badly

Sometimes the news media hypes stories. Tonight’s election is not one of those times.

Tens of millions of people are casting votes today that will decide not just the direction of the United States for the next two years, but whether President Donald Trump will be able to move forward with his agenda — or become mired in investigations and see it grind to a halt. Trump’s wish list for the coming year includes another big tax cut, more tariffs on foreign goods, tougher immigration controls, relaxed environmental laws and the possible firing of Special Counsel Robert Mueller. 

Democrats need to have a net gain of 23 seats in the 435-seat House of Representatives to retake control from the Republicans for the first time in eight years. If that happens, San Francisco’s Nancy Pelosi will be the odds-on favorite to become speaker again, which would put her second in the line of succession for the presidency, behind Vice President Mike Pence. And if they prevail tonight, Democrats not only will block most of Trump’s legislative agenda in 2019 and 2020, but they also will push to make his tax returns public, force his White House aides and cabinet officials to testify under oath in investigations, and stall many of his plans — from expanding offshore oil drilling to building a wall on the Mexican border — by denying funding for those things in the federal budget.

In short, tonight is an up-or-down vote on Trump’s presidency.

Polls show Democrats are favored to win back the House. But dozens of races are very close. And as voters learned in 2016, sometimes “sure things” end in surprises.

Apart from the House, there are other marquee events this evening. They include which party will control the U.S. Senate. Which party will win governor’s races to determine who sets the voting rules for the 2020 presidential election and who draws congressional districts for the next decade. Also up in the air: The fate in California of the gas tax, rent control and billions of dollars in homeless funding, hospital money and water projects.

Polls on the East Coast begin closing at 3 p.m. Pacific time. Most states begin reporting their results by 5 p.m., and California polls close at 8 p.m.

What to watch for:

1) Will the House turn Democratic and stall Trump?

The U.S. Capitol (J. Scott Applewhite/Associated Press)

There is no bigger question tonight. It’s common for a president’s party to lose seats in the House of Representatives in midterm elections. Since 1974, the average loss has been 22 seats. But when presidents have low public approval ratings, those losses are often bigger.

Currently, Trump has a very low approval rating — just 40 percent in the latest Gallup Poll. That’s lower than President Obama’s (45 percent) and President Clinton’s (46 percent) at the same time in their presidencies. In the 2010 midterms, Obama’s Democratic Party lost 63 seats in the House. Similarly, in 1994, Clinton’s Democrats lost 53 seats. But when George W. Bush’s approval rating was at a sky-high 63 percent in 2002, not long after the Sept. 11 attacks, Republicans gained six House seats.

Bottom line: Things look bad for the Republicans tonight. Democrats have raised more money. There are more open seats than normal due to 40 House Republicans retiring. Polls show Democrats ahead or tied in many races, with at least two dozen Republican incumbent House members struggling at 47 percent or lower in their re-election polls. Women, college graduates and young voters have been overwhelmingly calling for a change in the country’s direction. And Monday, multiple news outlets reported that Trump’s advisers were telling him to brace for the loss of the House.

But it’s not a guarantee. Republicans have two big trends in their favor. The economy is strong. And because of their big wins in 2010, Republican governors and state lawmakers drew district lines favorable to Republicans. That kind of gerrymandering has given Democrats a bigger hill to climb today in many states as they seek to take back House seats. Trump has worked in recent weeks to rally his base, appealing to their distrust and dislike of immigrants with increasingly tough anti-immigration messages, and by sending troops to the U.S.-Mexican border to address a rag-tag caravan of migrant refugees who is 700 miles away.

By about 5 p.m. Pacific time, we’ll start getting key clues on which side voters are choosing.

The action begins in states like Florida, Virginia and Pennsylvania. Pay particular attention to races like Kentucky’s 6th congressional district where Democrat and former Marine combat pilot Amy McGrath is locked in a neck-and-neck race with Republican incumbent Andy Barr in a district that Trump won in 2016 by 15 points. If Barr, who voted to repeal the Affordable Care Act, loses, it’s a sign that the Democrats’ emphasis on health care is paying off.

Similarly, watch Virginia’s 7th district in the suburbs of Richmond, which has been held by  Republicans for 47 years. There, former CIA analyst Abigail Spanberger is nearly even with Tea Party GOP incumbent Dave Brat, an economics professor, in the polls.

One big change this year? California really matters. Seven of California’s 53 House seats are in districts where Hillary Clinton won more votes than Trump in 2016, but which are currently held by Republicans.

Democrats are hoping wins in these five districts now held by Republicans will put them over the top nationally:

- CA-10 (Modesto) – Incumbent Republican Jeff Denham trails narrowly in polls to Democrat Josh Harder, a 32-year-old venture capitalist and Stanford graduate.

- CA-21 (San Joaquin Valley) Incumbent Republican David Valadao leads Democrat T.J. Cox, a Fresno businessman.

- CA-25 (Northern L.A. and Ventura counties) Incumbent Republican Steve Knight narrowly leads Democrat Katie Hill, an executive director of a non-profit group assisting the homeless.

- CA-45 (Orange County) Incumbent Republican Mimi Walters trails Democrat Katie Porter, a UC-Irvine law professor, in polls.

- CA-48 (Huntington Beach) Incumbent Republican Dana Rohrabacher is polling dead even with Democrat Harley Rouda, an attorney and real estate investor.

And Democrats dearly want victories in these two seats held by Republicans who chose not to run for re-election:

- CA-39 (Los Angeles and Orange counties)  Democrat Gil Cisneros, a former Frito-Lay manager who won $266 million in the lottery and set up a foundation to send Latino students to college, narrowly leads Republican Assemblywoman Young Kim, the first Korean-American elected to California’s Legislature, in the race to succeed retiring incumbent Ed Royce.

- CA-49, (Northern San Diego County) Democrat Mike Levin, a clean tech entrepreneur, leads Republican Diane Harkey, a former assemblywoman and mayor of Dana Point, in the race for retiring incumbent Darrell Issa’s seat.

Finally, there’s the ugliest congressional race in California, the 50th district, in Eastern San Diego County. There, five-term incumbent Republican Duncan Hunter, a Marine combat veteran and staunch conservative whose father held the seat before him, faces a very tight race after he was indicted in August on charges of stealing $250,000 in campaign funds to pay for vacations, golf outings and flying a pet rabbit across the country.

As polls have gotten within a few percentage points, Hunter has used anti-Muslim TV ads and speeches to attack his challenger, Democrat Ammar Campa-Najjar, a 29-year-old former aide to President Obama who is half Latino and half-Muslim. Campa-Najjar is “working to infiltrate Congress” with the support of the Muslim Brotherhood, Hunter said in one ad, and is “a national security threat,” he said in another. Campa-Najjar has countered that he is a Christian who had a security clearance in the Obama White House, a clearance that Hunter, facing multiple felonies, would not be able to get. Democratic money is flooding into the conservative district, but Hunter still has a slight lead in the polls.

If control of Congress comes down to these close California House races, the outcome might not be known for several days, or even weeks, because California law allows mail-in ballots to count as long as they are postmarked by Election Day.

 2) Sleeper story of the night? Governor’s races

 
Former President Barack Obama rallies with Democratic gubernatorial candidate Andrew Gillum (left) and Democratic Senate candidate Bill Nelson in Florida on Nov. 2, 2018 (Associated Press)

If Democrat Gavin Newsom beats Republican John Cox and succeeds Jerry Brown, it will be — amazingly — the first time a Democratic governor has been succeeded by another Democratic governor in California in 131 years. The last time that happened was in 1887, when George Stoneman, a former Union Army cavalry officer who moved West after the Civil War, was succeeded by fellow Democrat Washington Bartlett, then mayor of San Francisco. Stoneman only served one term, and moved back to New York after political opponents burned his house down. Bartlett, a Georgia native, sailed to San Francisco in 1850 for the Gold Rush, opened the first daily newspaper on the West Coast, and died only nine months after taking office as governor from kidney disease and other health problems.

In deep blue California, Newsom has a double-digit lead in the polls and is widely expected to win easily. But in other key states, Democrats are also poised to make big gains. And that could be one of the most important stories of this election.

Currently, Republicans hold 33 of the nation’s 50 governor’s offices. Democrats hold 16, and one, Bill Walker of Alaska, is an independent. Many top analysts, such as Larry Sabato of the University of Virginia, say Democrats could pick up a net of 10 more governorships on Tuesday. Most of those could come in states that are critical in the 2020 election, including Florida, Michigan, Ohio, Iowa, Wisconsin, Nevada and Illinois. The governors who are elected tonight will be in office in 2020 to oversee the presidential election in their states. Democratic victories would likely mean opening more polling places, expanded voting hours and fewer rules Republicans have put in place that critics say have led to voter suppression. And they will be in office when their states draw new congressional district boundaries after the 2020 Census, giving Democrats a further advantage in the decade ahead. 

Republicans have a chance to oust Democratic governors in Oregon and Connecticut, and take Alaska. But given last-minute trends, Democrats like Andrew Gillum in Florida, Tony Evers in Wisconsin and Richard Cordray in Ohio may be knocking off their Republican rivals. Among the most closely watched races is Georgia, where Stacey Abrams is seeking to become the first black female governor in the United States, and is locked in a very close race with Republican Brian Kemp.
 
3) Can Republicans hold the U.S. Senate?

The math in the U.S. Senate, which decides the fate of Supreme Court justices, is simple. Republicans have 51 seats. And Democrats have 49. Democrats need to pick up two to gain a majority.

That should be simple in a blue wave election right? Hardly. Democrats have the most difficult map in generations. Of the 33 seats up for re-election, 25 of them are Democratic, and just eight are Republican.

There are 11 races considered close. Of those, incumbent Democrat Heidi Heitkamp in North Dakota trails Republican Kevin Cramer by 11 points. If she loses as expected, the Democrats would have to win nine of the remaining 10 to capture the Senate.

That means winning closes races in Nevada, Arizona, Indiana, West Virginia and Missouri, and then pulling off upsets in Texas, where Democratic congressman Beto O’Rourke is working to topple Republican Ted Cruz but still trails in the polls, or Tennessee, where former Nashville Mayor and Democrat Phil Bredesen trails Republican congresswoman Marsha Blackburn in the race for retiring Republican Bob Corker’s seat.

Bottom line: Republicans are the odds-on favorite to hold a majority, or even pick up a seat or two. But Democrats are holding out hope that a huge blue wave could help them run the table.
 
4) Democratic sweep in California?
 

The biggest races in California are sleepers. Registered Democratic voters dramatically outnumber registered Republicans, 43-24 percent, with 27 percent of California voters having no party preference.

That means every Democratic candidate essentially starts with an 18-point lead over their Republican rival.

Lt. Gov. Gavin Newsom has a big lead in the polls, and in fundraising, over San Diego businessman John Cox in the governor’s race. And Democratic Sen. Dianne Feinstein has a similarly big lead over fellow Democrat Kevin de Leon. Look for both of those races to be called shortly after the polls close at 8 p.m.

Two Democrats in the same race? That’s because California’s top-two primary rules allow the top-two vote-getters to advance to the general election, even if they are both from the same party.

Democrats are expected to similarly win the race for state treasurer, lieutenant governor, secretary of state and controller. 

Two races offer some drama, however. First is state superintendent of schools, where Assemblyman Tony Thurmond of Oakland, backed by teachers unions, trails fellow Democrat Marshall Tuck, a charter school advocate and former education adviser to Los Angeles Mayor Antonio Villaraigosa, in a bitter showdown that has drawn $50 million in campaign contributions. Advocates of each man see the election as a showdown over the future of California schools.

And in the race for state insurance commissioner, Steve Poizner, a Los Gatos tech investor and former Republican, seeks to become the first independent to win statewide office in California history. Poizner, who had served in the post from 2007 to 2011, faces Democrat Ricardo Lara of Bell Gardens, one of the state senate’s most liberal members, and a backer of single-payer health insurance. Poizner, attempting a political comeback after being beaten by Meg Whitman in the 2010 Republican primary for governor, says he hopes to usher in a new area of non-partisanship in state government.
 5) Big money in ballot measures
 

Most of the attention is on the race for control of Congress. But Californians will decide whether to spend billions of dollars as they cast their votes.

The most closely watched state ballot measure is Proposition 6, which was placed on the ballot by Republicans hoping to repeal a 12-cent gasoline tax approved by Gov. Jerry Brown to raise $5 billion a year in road repairs. The GOP didn’t follow through with funding, however, and the measure has fizzled in the polls amid a wave of opposition from labor unions, Democratic leaders and some business organizations like the Silicon Valley Leadership Group.

Voters also will decide whether to approve lots of bonds: $4 billion for low-income housing programs and veterans home loans (Prop 1); $2 billion for homeless programs (Prop 2); $8.8 billion for water projects (Prop 3); and $1.5 billion for children’s hospitals (Prop 4).

That’s a lot of money. Remember, bonds are like mortgages. The government borrows money for the big expense and pays it off over 30 or 40 years with interest, usually doubling the overall cost. But voters like them. Since 1993, Californians have approved 79 percent of the 49 bond measures on the statewide ballot.

There are also lots of spending proposed in Bay Area counties:

- Proposition C in San Francisco, is a new tax on businesses, pushed by Salesforce CEO Marc Benioff, that would raise $300 million a year for homeless programs by increasing the gross receipts tax on corporate revenue by about .5 percent. It would affect roughly 400 of the city’s largest companies and has split the tech community, with Twitter CEO Jack Dorsey opposed. As many as 400 companies in the city would be affected.

- Proposition A in San Francisco, a $425 million bond measure to fund earthquake retrofitting and repairs to the city’s aging seawall for three miles between ATT Park and Fisherman’s Wharf, funded by a property tax hike of $130 a year per $1 million of assessed value.

- Measure T, a $650 million bond measure in San Jose to fund emergency and disaster responses, flood control, infrastructure and road, funded by a property tax hike of $110 a year per $1 million of assessed value.- Measure V, a $450 million bond measure in San Jose to fund housing programs for low-income residents and homeless people, funded by a property tax hike of $80 a year per $1 million of assessed value.

- Measure AA in Oakland, a $198, 30-year parcel tax to raise about $30 million annually for preschool and early childhood education programs.

- Measure W in San Mateo County, a half-cent sales tax increase to raise $80 million a year for roads, highways, bike lanes, SamTrans buses and Caltrain.

- Measure P in Mountain View, a “head tax” of up to $149 a year per employee of large companies like Google to raise roughly $6 million a year to go to the city’s general fund.

The economy is good. Bay Area housing prices and salaries are up. But will voters be overwhelmed by all the new spending? Or continue to fund government programs that have widespread support in liberal-dominated areas?

Article source: https://www.mercurynews.com/2018/11/06/election-night-live-blog-bay-area-california-national-voting-updates/

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One home got 14 offers. Another, none. What’s up with Sacramento’s real estate market?

A spacious Rocklin home sits on the market for weeks with no offers. At the same time, a tiny bungalow in South Land Park gets 14 offers immediately.

What gives?

The Sacramento real estate market has officially softened. Buyers are choosy, seemingly picking well-kept and well-priced homes in desirable neighborhoods, and taking a pass on homes that come in over-priced or in need of fixing.

Home sales have dropped 18 percent in the Sacramento region in September compared to the same month the year before – making this the lowest September sales since 2011, according to new data from CoreLogic, a real estate data consultancy.

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Homes are still selling, and sellers are often getting their asking prices, but it’s become a hit-or-miss moment for sellers.

“The market is stabilizing,” said Paula Swayne, an agent with Dunnigan, Realtors. “Hopefully, we are (entering) an equitable market for buyer and seller. If priced right, you’ll get an offer or two in the first two weeks.”

“I like this market better, to be honest,” Swayne said. “Everybody wins.”

Swayne scored the 14-offer sale in Land Park last month – a sale she says that shows even though buyers are cautious, the market is not dead, and that a neatly kept, moderately priced home in a good neighborhood will sell fast and at asking price or higher.

Her Land Park home was particularly compelling. Tiny, at 900 square feet, it was in great shape in a coveted neighborhood and came at a rare sub-$300,000 price.

At the same time, a six-bedroom Rocklin house went unsold even though buyers dropped their price last month to $538,000. It is now off the market.

Barbara Lebrecht of the Galster Real Estate Group said the home was competing against a “glut of inventory in a small suburban area where new homes are being built … and buyers have a lot of choice.”

Local real estate analysts Ryan Lundquist said the local home-buying market is in a lull moment, but that’s not unusual for this time of year, and “not so painfully dull that buyers aren’t making offers.”

His analysis shows that 40 percent of September home sales had multiple offers. It’s happening, though, on houses that are in very good shape, he said.

“Buyers are more sensitive. They want a better housing product. We are in an age when granite and quartz (counter tops) are normal. What buyers want is that move-in condition when possible.”

The Sacramento regional trend mirrors what is happening around California in the last four months.

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Eddie Murphy’s former Granite Bay mansion sells for $5 million in 5-minute auction

CoreLogic reports the number of homes sold in the San Francisco Bay Area in September was off 18 percent from the previous year. In Los Angeles, the decline was 19 percent.

“The double whammy of higher prices and rising mortgage rates has priced out some would-be buyers and prompted others to take a wait-and-see stance,” said Andrew LePage, a CoreLogic analyst.

The California Association of Realtors last week reported that softening home prices have made it marginally easier to buy in recent months. Still, only 27 percent of California households could afford to buy the median-priced home in the state last month. And housing affordability remains far below what it was in 2012 when 56 percent could afford the median.

While the median price of homes sold in many areas has been stable or even inched downward in recent months, rising interest rates continue to make it hard for many would-be buyers to get into a home.

In Sacramento County, 43 percent of households can afford a median-priced home. In much of the Central Valley, between 40 and 50 percent of households can afford the median, according to the statewide association.

That is considerably higher than in the Bay Area, where homes are typically three to four times more expensive, and the affordability percentages are in the teens and twenties.

The median price in Sacramento County for home sales in September nudged up slightly to $365,000 from the previous month, August, when it was $360,000, according to CoreLogic. Placer and Yolo saw slight increases as well, and El Dorado County remained the same.

Article source: https://www.sacbee.com/news/business/real-estate-news/article220466045.html

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Kelly Quon Is Awarded Zephyr Real Estate’s Golden Z Community Service Award

SAN FRANCISCO, Nov. 05, 2018 (GLOBE NEWSWIRE) — Zephyr Real Estate agent Kelly Quon just received Zephyr’s prestigious Community Service Award, the Golden Z. The award is presented to someone within the Zephyr family who has made an extraordinary contribution to the Bay Area community, someone who has made a difference in the lives of others.

Kelly and Team Quon have done just that in their fundraising efforts for PurpleStride. Their efforts have had a tremendous impact, collecting over $250,000 for the organization to continue research aimed at finding a cure for pancreatic cancer and in the effort to raise awareness about the disease.  Kelly’s sister Cathy, a 16-year survivor, was present at the ceremony along with their parents.  Cathy shared her own amazing survival story about this disease, which typically claims 80 percent of those diagnosed within the first year and 97 percent within the first five.

Zephyr has presented only 16 of these awards in the past 40 years, and proudly awarded Kelly Quon with the 17th Golden Z Award. “Efforts like Kelly’s are fundamental not only in raising awareness but also in advancing science and research towards a cure. We applaud her work with PurpleStride,” remarked Randall Kostick, Zephyr’s Chief Executive Officer.

“I am truly honored to receive this award but, honestly, I am so very grateful for the graciousness and generosity of so many of my Zephyr colleagues who have donated to my fundraising efforts,” commented Kelly. “I am also extremely grateful to Zephyr for matching those donations from my colleagues. Together, we have made a difference.”

PurpleStride began in 2008 in Chicago with a small group of volunteers who had all been touched personally by this ruthless disease, a disease that had, at that time, a five-year survival rate of barely six percent. Those volunteers raised over $380,000 and brought together more than 1600 people. The movement quickly spread across the country, and currently multiple events are held nationwide every year. The organization has now raised an excess of $87 million. More importantly, the five-year survival rate has increased to nine percent in that time period, with a determination to continue moving the needle for patients battling pancreatic cancer.

Kelly, a second generation native of San Francisco, works from Zephyr’s Upper Market office and may be reached at kellyquon@zephyrsf.com or 415.552.9500.

About Zephyr Real Estate
Founded in 1978, Zephyr Real Estate is San Francisco’s No. 1 independent real estate firm with nearly $2.3 billion in gross sales and a current roster of more than 350 full-time agents. Zephyr’s highly-visited website has earned two web design awards, including the prestigious Interactive Media Award. Zephyr Real Estate is a member of the international relocation network, Leading Real Estate Companies of the World; the luxury real estate network, Who’s Who in Luxury Real Estate; global luxury affiliate, Mayfair International; the local luxury marketing association, the Luxury Marketing Council of San Francisco; and the regional luxury real estate affiliation, the Artisan Group. Zephyr has nine locations across San Francisco, Marin, Alameda and San Mateo Counties and two brokerage affiliates in Sonoma County, all strategically positioned to serve a large customer base throughout the San Francisco Bay Area. For more information, visit www.ZephyrRE.com.

Melody Foster                                                                                                      
Zephyr Real Estate
San Francisco, CA
415.426.3203
melodyfoster@zephyrsf.com

A photo accompanying this announcement is available at http://www.globenewswire.com/NewsRoom/AttachmentNg/f611e7a6-5be3-4d77-8bc1-89ae8740aaaf.

Article source: https://globenewswire.com/news-release/2018/11/05/1645357/0/en/Kelly-Quon-Is-Awarded-Zephyr-Real-Estate-s-Golden-Z-Community-Service-Award.html

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San Francisco Bay area home sales suffer their slowest September in 11 years

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Home sales in the San Francisco Bay area have been falling for months, but in September buyers pulled back in an even bigger way.

Sales of both new and existing homes plunged nearly 19 percent compared with September 2017, according to CoreLogic. It marked the slowest September sales pace since 2007 and twice the annual drop seen in August.

“Job growth and demographic trends have created plenty of housing demand, but the combination of higher home prices and increasing mortgage rates have priced out some buyers and prompted others to take a wait-and-see stance,” said Andrew LePage, a CoreLogic analyst who had much the same commentary in a report Tuesday on why sales in Southern California fell sharply as well.

He did note, as with Southern California, that this September had one less business day for recording transactions. Adjusting for that, the annual sales decline would be about 15 percent – still one of the larger declines in recent years.

The Bay Area report covers homes and condominiums sold in Alameda, Contra Costa, Marin, Napa, Santa Clara, San Francisco, San Mateo, Solano and Sonoma counties.

Unlike in Southern California, where home price gains shrank to 3 percent annually, the median price paid for Bay Area homes in September, $815,000, was still up 9.3 percent compared with a year ago. In both May and June, the median price hit $875,000, the highest on record.

“Although still larger than in many regions, the 9.3 percent year-over-year gain in the Bay Area’s median sale price was the lowest in 15 months,” LePage said. “Price growth could continue to weaken if sales continue to slow amid a rise in listings.”

He said this would be a welcome development for possible homebuyers, although there still could be a hurdle: monthly mortgage payments pushed up by higher rates.

“The principal-and-interest mortgage payment on the median-priced home was up 21 percent on a year-over-year basis this September because mortgage rates increased about 0.8 percentage points over that period,” LePage said.



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Buyers in the Bay Area had been hampered by high prices due to very low supply, but that dynamic is changing. Active listings in October were up 130 percent year-over-year in the San Jose-Sunnyvale-Santa Clara market and up 42 percent in San Francisco-Oakland-Hayward, according to realtor.com.

“Buyers have been struggling for four years to find homes in their price range, while dealing with bidding wars and multiple offer situations,” said Danielle Hale, chief economist for realtor.com. “The inventory increase will not solve the problem overnight, but it should provide some relief to those still in the market, especially if the growth we’re seeing in more affordable homes and condos holds steady.”

Affordability, however, continues to weaken, as mortgage rates rise and home values grow. While inventory is up, it is up from a critical shortage, and supply and demand are still not in balance.

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Article source: https://www.cnbc.com/2018/10/31/san-francisco-area-home-sales-suffer-slowest-september-in-11-years.html

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Leaving Los Angeles: What the new exodus inland tells us

56985 MW GS072 leavin 20181019083418 MG Leaving Los Angeles: What the new exodus inland tells us

A decade ago, the communities inland from Los Angeles became the poster children of the housing bubble. As real estate agents urged clients to “drive until you qualify,” the communities of Riverside County filled with eager house-buyers who weren’t afraid of 90-minute commutes – each way.

Then the economy crashed, jobs dried up, the loosey-goosey mortgages people had relied on to finance their purchases stopped cooperating, and the exurbs emptied out.

Now, that trend seems to be back. Californians are fleeing the high-cost cities and heading inland. Is it a sign of another bubble? Or a confirmation that the cutthroat housing market is turning some pricey cities into gated communities?

One economist thinks the story is more nuanced that all that. The coastal exodus isn’t necessarily a return to the bad old ways. And while it is, in part, a reaction to the affordability crisis, Issi Romem, chief economist at BuildZoom and fellow at the Terner Center for Housing Innovation at Berkeley, says it’s healthy to see Americans on the move, in California and everywhere. The bigger question is: Where do they go, and what do they do when they get there?

See: As the housing market stagnates, American homeowners are staying put for the longest stretches ever

Romem and a Terner Center colleague, Elizabeth Kneebone, published a study in October on people leaving the Bay Area.

In a blog post, they summarized their findings this way: “The San Francisco Bay Area exchanges people of all income levels with all parts of the country, but the origins and destinations of those coming and going differ substantially by income. Low-income residents are over-represented among those moving between the Bay Area and more affordable parts of California, such as the Sacramento region and the Central Valley, while those moving between the Bay Area to farther destinations—primarily large metropolitan areas in other parts of the country—tend to have higher incomes, especially if the move is to or from the Northeast.”

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At MarketWatch’s request, Romem extended his research to the Los Angeles metro area. He found that many of the Bay Area patterns also exist in LA: people leaving for the Bay Area and the Northeastern U.S. tend to be more affluent, while those going to places like Las Vegas are less so. Interestingly, those going to the Inland Empire are more mixed. As Romem put it, they “aren’t especially affluent, but they aren’t the opposite either.”

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In some ways, these findings reinforce unpleasant truths about a housing market that seems to be growing more unequal.

“The expensive coastal cities are, in a sense, an amenity or a good that people want,” Romem told MarketWatch. “It’s a sought-after thing to live in those expensive coastal areas and the number of slots to live there is restricted. There are fewer slots for the less affluent incumbents. These people tend to be people of color, but not only, and they are pushed into situations where in order to afford housing they undertake a difficult daily commute, or they move to other parts of the country and leave the coastal cities to those who can afford to enjoy them.”

But Romem sees the coastal exodus in a glass-half-full perspective. “I want to say that makes the area less inclusive, but at the same time, immigrants from outside the city see the city as a gateway.” Areas like LA are kept diverse by the churn of in-migrants from all over, Romem believes, whether they are immigrants or not.

Read: Meet the little bank that’s helping immigrants achieve big American Dreams

The point on which LA and San Francisco differ hearkens back to a unique idea put forward three decades ago by a writer named Joel Garreau. In “The Nine Nations of North America,” Garreau described San Francisco as the capital of a vast region called “Ecotopia,” stretching all the way up into Alaska. Los Angeles, meanwhile, is the capital of “Mexamerica,” the southern and central valley of California, southern Arizona, and parts of New Mexico and Texas.

What defines Ecotopia and Mexamerica? In the former, in Romem’s words, “growth is a dirty word,” while places like LA and Las Vegas have no compunction about sprawling outward. “What does that mean for their economies? That’s not clear to me,” Romem told MarketWatch.

Sprawl has happened for as long as there has been a metro area and space that can be defined as “beyond” that area. It may have been aided and abetted by lax lending in the aughties, but it didn’t start then. Now, people leaving LA for the Inland Empire presumably either don’t mind the long commute back to the coast, or have jobs lined up locally. Those leaving LA for Las Vegas may be planning to telecommute to jobs in LA. And people heading to Phoenix may be retiring and bringing with them a fixed income.

Also see: As housing reignites, even bust towns are booming again

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Andrea Riquier reports on housing and banking from MarketWatch’s New York newsroom. Follow her on Twitter @ARiquier.

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Article source: https://www.marketwatch.com/story/leaving-los-angeles-what-the-new-exodus-inland-tells-us-2018-11-01

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