While u.s. homelessness up–florida is down 4.1%

LOS ANGELES (AP) – Dec. 6, 2017 – The nation’s homeless population increased this year for the first time since 2010, driven by a surge in the number of people living on the streets in Los Angeles and other West Coast cities.

The U.S. Department of Housing and Urban Development (HUD) released its annual Point in Time count Wednesday, a report that showed nearly 554,000 homeless people across the country during local tallies conducted in January. That figure is up nearly 1 percent from 2016.

Of that total, 193,000 people had no access to nightly shelter and instead were staying in vehicles, tents, the streets and other places considered uninhabitable. The unsheltered figure is up by more than 9 percent compared to two years ago.

Increases are higher in several West Coast cities, where the explosion in homelessness has prompted at least 10 city and county governments to declare states of emergency since 2015. City officials, homeless advocates and those living on the streets point to a main culprit: the region’s booming economy.

Rents have soared beyond affordability for many lower-wage workers who until just a just few years ago could typically find a place to stay. Now, even a temporary setback can be enough to leave them out on the streets.

“A lot of people in America don’t realize they might be two checks, three checks, four checks away from being homeless,” said Thomas Butler Jr., who stays in a carefully organized tent near a freeway ramp in downtown Los Angeles. Butler said he was in transitional housing – a type of program that prepares people for permanent homes – for a while but mostly has lived on the streets for the past couple of years.

The numbers in the report back up what many people in California, Oregon and Washington have been experiencing in their communities: encampments sprouting along freeways and rivers; local governments struggling to come up with money for long-term solutions; conflicts over whether to crack down on street camping and even feeding the homeless.

The most alarming consequence of the West Coast homeless explosion is a deadly hepatitis A outbreak that has affected Los Angeles, Santa Cruz and San Diego, the popular tourist destination in a county where more than 5,600 people now live on the streets or in their cars. The disease is spread through a liver-damaging virus that lives in feces.

The outbreak prompted California officials to declare a state of emergency in October.

The HUD report underscores the severity of the problem along the West Coast.

While the overall homeless population in California, Oregon and Washington grew by 14 percent over the past two years, the part of that population considered unsheltered climbed 23 percent to 108,000. That is in part due a shortage of affordable housing.

In booming Seattle, for example, the HUD report shows the unsheltered population grew by 44 percent over two years to nearly 5,500.

The homeless service area that includes most of Los Angeles County, the epicenter of the crisis, saw its total homeless count top 55,000 people, up by more than 13,000 from 2016. Four out of every five homeless individuals there are considered unsheltered, leaving tens of thousands of people with no place to sleep other than the streets or parks.

By comparison, while New York City’s homeless population grew to more than 76,000, only about 5 percent are considered unsheltered thanks to a system that can get people a cot under a roof immediately.

In the West Coast states, the surge in homelessness has become part of the fabric of daily life.

The Monty, a bar in the Westlake neighborhood near downtown Los Angeles, usually doesn’t open until 8 p.m. Partner and general manager Corey Allen said that’s because a nearby shelter requires people staying there to be in the building by 7. Waiting until after that to open means the streets outside are calmer.

Allen said the homeless have come into his bar to bathe in the restroom wash basins, and employees have developed a strategy for stopping people from coming in to panhandle among customers.

Seventy-eight-year-old Theodore Neubauer sees the other side of it. Neubauer says he served in Vietnam but now lives in a tent in downtown Los Angeles. He is surrounded by thriving business and entertainment districts, and new apartments that are attracting scores of young people to the heart of the nation’s second-most populous city.

“Well, there’s a million-dollar view,” he said.

Helping those like Neubauer is a top policy priority and political issue in Los Angeles.

Since last year, voters in the city and Los Angeles County have passed a pair of tax-boosting ballot initiatives to raise an expected $4.7 billion over the next decade for affordable housing and services for the homeless. HUD Secretary Ben Carson praised the region for dealing with the issue and not relying solely on the federal government.

“We need to move a little bit away from the concept that only the government can solve the problem,” he said.

But Mayor Eric Garcetti said that insufficient federal funding for affordable housing and anti-homelessness programs are part of the reason for the city’s current crisis. “Los Angeles’ homelessness crisis was not created in a vacuum, and it cannot be solved by L.A. alone,” Garcetti said in a statement.

Excluding the Los Angeles region, total homelessness nationwide would have been down by about 1.5 percent compared with 2016.

The California counties of Sacramento, which includes the state capital, and Alameda, which is home to Oakland, also had one-year increases of more than 1,000 homeless people.

In contrast, the HUD report showed a long-running decline in homelessness continuing in most other regions. Nationally, the overall homeless number was down by 13 percent since 2010 and the unsheltered number has dropped by 17 percent over that seven-year span, although some changes in methodology and definitions over the years can affect comparisons.

Places where the numbers went down included Atlanta, Philadelphia, Miami, the Denver area and Hawaii, which declared a statewide homelessness emergency in 2015.

The homeless point-in-time survey is based on counts at shelters and on the streets. While imperfect, it attempts to represent how many people are homeless at a given time. Those who work regularly with the homeless say it is certainly an undercount, although many advocates and officials believe it correctly identifies trend lines.

The report is submitted to Congress and used by government agencies as a factor in distributing money for programs designed to help the homeless.

AP Logo Copyright © 2017 The Associated Press, Christopher Weber and Geoff Mulvihill. All rights reserved. This material may not be published, broadcast, rewritten or redistributed. Mulvihill reported from Cherry Hill, New Jersey. AP videographer Krysta Fauria and photographer Jae Hong in Los Angeles contributed to this article.  

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Citizens Insurance says finances solid after Irma

TALLAHASSEE, Fla. – Dec. 1, 2017 – Citizens Property Insurance appears to have emerged from the 2017 Atlantic storm season on firm financial footing, even with an anticipated $1.2 billion hit from Hurricane Irma.

Policyholders of the state-backed insurer have filed 62,000 Irma-related claims, including more than 42,400 from Miami-Dade, Broward and Monroe counties. Nearly two-thirds of the claims had been closed as the annual hurricane season ended Thursday.

Citizens anticipates over the next year its number of claims from Irma, which made landfall Sept. 10, will grow to as many as 70,000, with $1.2 billion in policyholder damages. But Citizens pointed to steps taken to build up money and buy reinsurance – essentially backup insurance for insurers – that helped it weather Irma.

“With $6.4 billion in surplus and substantial reinsurance coverage, Citizens remains fiscally sound after responding quickly and effectively to Hurricane Irma,” Citizens Chairman Chris Gardner said in a prepared statement. “But we still have much work to do. Our focus will remain on our policyholders until we have satisfactorily handled all outstanding claims.”

Citizens spokesman Michael Peltier said about half of the closed claims have resulted in payments. Many policyholders who did not receive payments reported damages that failed to reach their hurricane deductibles.

For those receiving money, the average residential claim payment has been $13,040.

As of Nov. 13, the Florida Office of Insurance Regulation reported that Irma had caused more than 830,000 property-insurance claims for insurers across the state, with estimated insured losses of $5.88 billion.

Just over 38 percent of the claims had been closed with payments made. Another 26 percent were closed without any money changing hands.

The state office is expected to update the post-storm numbers on Monday.

Citizens made landfall in Monroe and Collier counties and then caused widespread damage as it moved up the state. Days after the storm made landfall, Citizens was bracing for up to 125,000 claims.

The company, which has estimated that a 100-year storm hitting Florida could result in up to $6.6 billion in claims, has $7.4 billion in surplus and reinsurance.

In addition, Citizens continues to expect to recoup about $193 million after Irma from the Florida Hurricane Catastrophe Fund, which also provides backup coverage.

With 448,737 policies statewide as of Oct. 31, Citizens has less exposure than it did five years ago when it covered nearly 1.5 million properties.

Last year, Citizens paid out $10.7 million in claims related to hurricanes Hermine and Matthew, with about 4,000 claims filed.

Hermine, which made landfall south of Tallahassee as a Category 1 storm, resulted in 19,699 claims industry-wide that totaled $139 million in losses. Matthew, which never made landfall as it ran up the East Coast, had 119,345 claims, with losses projected at $1.182 billion.

Source: News Service of Florida, Jim Turner

Floridians’ optimism switches gears: Up 1.9 points in Nov.

 

GAINESVILLE, Fla. – Nov. 28, 2017 – After three months of consecutive declines, consumer sentiment among Floridians rose to 96.7 in November, up 1.9 points from October’s revised figure of 94.8, according to the latest University of Florida consumer survey.

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Consumer sentiment in Florida started 2017 with a record-breaking figure and, during the first half of the year, reached its highest level in 15 years. And now, despite downturns in the second half of the year, the index is still half a point higher than its 2017 average as the year draws to a close.

Among the five components that make up the index, four increased and one decreased in November.

Perceptions of personal financial situations now compared with a year ago rose 2.2 points, from 86.5 to 88.7. However, opinions as to whether it’s a good time to buy a big-ticket household item like an appliance dropped eight-tenths of a point, from 102.7 to 101.9. Readings varied across demographic groups without a clear pattern.

“Despite one reading going up and the other down this month, the perceptions of current economic conditions among Floridians have remained positive and stable during 2017,” says Hector H. Sandoval, director of the Economic Analysis Program at UF’s Bureau of Economic and Business Research.

Expectations of personal finances a year from now ticked up 1.2 points to 105.4. Anticipated U.S. economic conditions over the next year showed the greatest increase, up 4.6 points from 91.5 to 96.1. Expectations of U.S. economic conditions over the next five years increased 2.3 points from 89.1 to 91.4.

“Future expectations improved greatly in this month’s reading. Similar to the perceptions of current economic conditions, they have remained consistent in 2017,” Sandoval says. “Overall, Floridians are more optimistic, and the gain in November’s sentiment came from consumers’ future expectations about the economy in the medium- and long-run. Nonetheless, consumer sentiment has been very favorable over the year.”

Economic indicators in Florida have remained largely positive, and the prospects for 2018 appear good. Since the beginning of the year, Florida’s labor market has strengthened, with solid job gains statewide every month. Between January and October, the Florida unemployment rate declined by 1.4 percentage points, from 5 to 3.6 percent, reaching the lowest rate in the past 10 years.

Also, Florida’s gross domestic product increased 3.6 percent in the second quarter of 2017, according to the U.S. Bureau of Economic Analysis. The leading contributors to economic growth in Florida include professional, scientific and technical services, the real estate and leasing sector, and retail trade.

“The favorable local economic conditions and positive trends on the labor market, combined with the positive expectations about the U.S. economy in the short and long run will have a positive impact on Florida’s economy in the beginning of next year,” Sandoval said.

Conducted Nov. 1-20, the UF study reflects the responses of 482 individuals who were reached on cellphones, representing a demographic cross section of Florida. The index used by UF researchers is benchmarked to 1966, which means a value of 100 represents the same level of confidence for that year. The lowest index possible is a 2, the highest is 150.

© 2017 Florida Realtors

Realtor.com: Housing boom is officially back

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CHICAGO – Nov. 14, 2017 – Housing prices have returned to the “boom levels” of a decade ago, but this time around, the fast appreciation is being fueled by strong supply-and-demand dynamics this time – not 2006’s predatory lending practices, investor speculation and too much construction, according to new realtor.com data released Monday.

“As we compare today’s market dynamics to those of a decade ago, it’s important to remember rising prices didn’t cause the housing crash,” says realtor.com Chief Economist Danielle Hale. “It was rising prices stoked by subprime and low-documentation mortgages, as well as people looking for short-term gains – versus today’s truer market vitality – that created the environment for the crash.”

The national median price for a home in 2016 was $236,000 – 2 percent higher than in pre-recession 2006 – according to realtor.com.

Out of the country’s 50 largest housing markets, 31 have returned to their levels during the last housing bubble (62 percent).

Realtor.com researchers finger Austin, Texas, as the city that has posted the largest increases in home prices – 63 percent – over the past 10 years. Denver and Dallas have also seen some of the biggest gains, at 54 percent and 52 percent, respectively.

On the other hand, three markets remained more than 20 percent below their 2006 highs: Las Vegas (25 percent below); Tucson, Ariz. (22 percent); and Riverside, Calif. (22 percent).

Source: realtor.com

© Copyright 2017 INFORMATION INC., Bethesda, MD (301) 215-4688

2017 Profile of international RE activity in Fla.

ORLANDO, Fla. – Nov. 10, 2017 – Since 2005, Florida Realtors has released an annual study on international real estate activity in Florida. Conducted by the National Association of Realtors (NAR) Research Group, it attempts to understand the interaction of members with international clients, the challenges and opportunities they face serving foreign clients, and the characteristics of foreign buyers who purchase Florida property.

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The 2017 Profile of International Residential Real Estate Activity in Florida covers the 12-month period of August 2016-July 2017 and includes info on U.S. clients seeking to purchase property abroad.

The survey considers only residential purchases in the state.

Survey highlights

Florida residential property purchases by foreign buyers

  • Foreign purchases in the state increased to $24.2 billion, a $4.8 billion increase from 2016’s $19.4 billion
  • Foreign transactions accounted for 21 percent of Florida’s residential dollar volume of sales, a 2 percent increase year-to-year
  • Foreign buyers purchased 61,300 Florida properties (47,000 in 2016), which made up 15 percent of Florida’s residential market (12 percent in 2016)
  • The median purchase price paid by foreign buyers increased to $259,400 ($252,500 in 2016), which was in line with the overall increase in Florida prices
  • The median price paid by foreign buyers was 18 percent higher than the median price paid by all Florida buyers

Nationalities of Florida’s foreign residential buyers

  • Latin American and Caribbean buyers accounted for the largest portion of Florida foreign buyers (34 percent), though this group made up 39 percent the previous year.
  • Canadian buyers increased to 22 percent (19 percent in 2016)
  • Other countries remained consistent year-to-year: The share of European buyers was unchanged at 23 percent; Asian buyers at 10 percent; and African buyers at one percent
  • Most foreign buyers were concentrated in five metropolitan areas: Miami-Fort Lauderdale-West Palm Beach (53percent); Orlando-Kissimmee-Sanford (11percent); Tampa-St. Petersburg-Clearwater (nine percent); Cape Coral-Fort Myers (six percent); and North Point-Sarasota-Bradenton (five percent)

Transaction details

  • 72 percent of foreign buyers made an all-cash purchase
  • 68 percent of foreign buyers purchased residential property for vacation, residential rental or for both uses (72 percent in 2016); 49 percent bought a townhouse or condominium (52 percent in 2016)
  • 35 percent (40 percent in 2016) purchased in a central city/urban area; 15 percent purchased in a resort area (14 percent in 2016)
  • 93 percent of foreign buyers visited Florida at least once before purchasing a property (92 percent in 2016)

Florida clients searching properties abroad

  • 17 percent of Florida’s Realtors said they had a client seeking to purchase property abroad, up from 14 percent in 2016
  • Top countries of interest from Florida residents looking elsewhere: Colombia, Costa Rica, Spain, Canada and the Dominican Republic
  • 75 percent were interested in residential property (79 percent in 2016)
  • 75 percent intended to use the property for vacation, residential rental or both uses (84 percent in 2016)

Florida’s Realtors interaction with international clients

  • While international business rose, fewer Realtors in Florida (44 percent) said they worked with an international client in 2017 (48 percent in 2016)
  • 61 percent of Realtors said they did not have cultural and language problems
  • Personal contacts, previous clients and business contacts accounted for 72 percent of referrals or leads
  • An agent’s firm, franchise website or social media was the primary source of online leads, followed by other aggregator websites and Realtor.com
  • Respondents were evenly split about the outlook in the next 12 months: 43 percent expected the same or an increase in international clients, 42 percent expected a decrease, and 15 percent had no opinion.
  • 56 percent expect foreign retirees to be potential clients

© 2017 Florida Realtors

NO BUBBLE, says Freddie mac

Freddie Mac November 2017 Insight

MCLEAN, VA–(Marketwired – Nov 9, 2017) – Freddie Mac (OTCQB: FMCC) released its November Insight, which explores the warning signs that lead to the collapse of last decade’s house price bubble and the concern of a possible new bubble. Despite the substantial house price increases in recent years and the evidence that house prices are unusually high in a growing number of metro areas, the Insight concludes that there is not currently a house price bubble.

The evidence against a bubble

  • The most important fundamental in today’s housing market is a lack of houses for sale, which affects virtually all the largest metros in the country.
  • Residential construction is falling roughly 500,000 homes short of demand every year. The shortage of houses for sale is strong evidence against a house price bubble. And the difficulty of increasing residential construction quickly suggests that any price adjustment will be gradual.
  • Contrary to a decade ago, easy credit is not fueling housing demand. Credit standards today are not looser than they were at the beginning of this century, a period that many analysts use as a reference for a “normal” mortgage market.
  • There is speculation that a sharp increase in house flipping — buying a house and fixing it up for quick resale — may have contributed to last decade’s house price bubble. However, today’s volume of flipping doesn’t appear to be pointing to a house price bubble.
  • Finally, homeowners are not increasing their mortgage leverage. The sharp growth in house prices is generating an almost dollar-for-dollar growth in homeowners’ equity with only negligible changes in mortgage debt outstanding.

Quote: Attributed to Sean Becketti, Chief Economist, Freddie Mac.
“The evidence indicates there currently is no house price bubble in the U.S., despite the rapid increase of house prices over the last five years. However, the housing sector is significantly out of balance. The incomplete recovery in residential construction following the crisis of the last decade has created several years of pent-up demand for household formation. What we can’t predict is how this imbalance will eventually be resolved. Will there be a gradual restoration of a normal balance between supply and demand? Alternatively, will the rate of home building remain stubbornly low, exacerbating the income and wealth inequality that followed the Great Recession? Another bubble appears to be a less probable scenario, but not an impossible one.”

Freddie Mac makes home possible for millions of families and individuals by providing mortgage capital to lenders. Since our creation by Congress in 1970, we’ve made housing more accessible and affordable for homebuyers and renters in communities nationwide. We are building a better housing finance system for homebuyers, renters, lenders and taxpayers. Learn more at FreddieMac.com, Twitter @FreddieMac and Freddie Mac’s blog FreddieMac.com/blog.

Flipping returns as investors push into resurging market

NEW YORK – Oct. 23, 2017 – Real estate observers say that house flipping, which declined after the financial crisis in 2008, is on the rise again, thanks to low interest rates and rising home prices.

Last year, 5.7 percent of all home sales were flips, the highest level since 2006, according to Attom Data Solutions.

The trend is attracting the interest of Wall Street: Last week, Goldman Sachs bought Genesis Capital, a leading lender to house flippers. The strategy requires fast access to money from developers who are willing to pay higher interest rates to get it. The loans are backed by the property typically run for a year or less.

For the lenders, the loaned funds to flippers offer reliable returns of about 8 percent from borrowers who must meet minimum investments, generally $100,000. The loans come with risks, however, including developers unable to pay them back and a drop in real estate prices that could make properties hard to sell or even rent.

Investors say hard-money loans are more stable than a bank mortgage because they’re secured by properties at a lower loan-to-value ratio, a risk assessment used by lenders. Hard-money lenders boast of the speed in which they finance loans, typically in less than a week, compared with several months for a traditional bank.

For the smaller builders and house flippers who rely on these loans to do business, the speed with which these lenders can have the money ready trumps the high interest rates they charge.

Source: New York Times (10/21/17) Sullivan, Paul

© Copyright 2017 INFORMATION INC., Bethesda, MD (301) 215-4688

Irma victims: The scammers are out there

TALLAHASSEE, Fla. – Sept. 13, 2017 – As communities across Florida begin the recovery process from Hurricane Irma, the Property Casualty Insurers Association of America (PCI) issued a warning for Floridians to be aware of unlicensed vendors that try to take advantage of storm victims.

“As Florida homeowners seek help with cleaning up and repairing storm damage from Hurricane Irma, PCI warns them to be cautious about the vendors they hire,” says Logan McFaddin, PCI Florida regional manager. “Unfortunately, there are a lot of unscrupulous, unlicensed vendors who try to take advantage of storm victims.”

Assignment of benefits (AOB) abuse can sometimes be a cover for fraud. Under AOB, lawyers and local unlicensed vendors work together to encourage homeowners to sign away their insurance rights by promising to take care of all details. AOB abuse was a growing problem in Florida before Hurricane Irma and has contributed to insurance premium increases.

“To avoid AOB fraud, PCI encourages Floridians to make sure they have use a preferred, licensed vendor to perform their home, business or auto repair,” says McFaddin.

PCI tips for selecting a repair vendor

·Check credentials. Take time to research the background of any businesses you’re considering hiring to make repairs. Check references and their status with the Better Business Bureau. Make an inquiry to the Florida attorney general’s office to see if the firms have any outstanding complaints.

  • Shop around. Get written estimates and compare bids. Ask for recommendations from friends and neighbors.
  • Use your insurer as a resource. Insurers are committed to helping the claims process go smoothly and often can recommend a reputable vendor.
  • Be suspicious. Vendors who try to rush you, especially on non-emergency or temporary repairs, often aren’t trustworthy. Be wary of anyone knocking on your door offering unsolicited repairs. Don’t sign any documents regarding insurance benefits without first talking to your insurer. Also, don’t believe a vendor who says they’re supported by the government. The Federal Emergency Management Agency (FEMA) does not endorse individual vendors.
  • Insist on a contract. Make sure you get a copy of a written, detailed contract that clearly states the scope of work, prices for labor and materials and estimated start and finish dates. Never sign a contract with blank spaces, which a crooked vendor can alter after you’ve signed it.
  • Don’t pay upfront. Always inspect the work and make sure you’re satisfied before you pay. Most vendors will require a reasonable downpayment on work, but you shouldn’t provide that until you have a written contract. Also, pay with a check or credit card instead of cash so that you have a record of your payments to the vendor.

© 2017 Florida Realtors

Study: FSBOs net ‘significantly’ lower profits

NEW YORK – Aug. 21, 2017 – For-sale-by-owners (FSBOs) tend to sell their homes for lower prices than homes sold through traditional agents via the MLS, and in many cases below the average differential represented by the prevailing commission rate, according to a new study by Collateral Analytics. The study examined the price differences between homes sold through traditional agents versus those sold by FSBOs from 2016 to the first half of 2017.

Some homeowners attempting to avoid commission costs attempt to sell their home on their own – but that can backfire and turn into a much lower sales price, the study found.

Even successful FSBO sellers achieve prices “significantly below” those from similar properties sold more traditionally via Realtors®, the study found. A FSBO sale, on average, nets nearly a 6 percent lower price than an MLS sale for a similar property, the study found.

Overall, the authors found that the differential in selling prices between FSBOs and MLS sales is “remarkably close to average commission rates.”

“Assuming that both buyers and sellers pay the commission, one might have expected something less than this average,” the researchers note. “It appears that many sellers are avoiding commissions while netting home prices less than they would with an agent-represented MLS sale.”

Source: “Saving Real Estate Commissions at Any Price,” Collateral Analytics Research (Aug. 16, 2017)

© Copyright 2017 INFORMATION INC., Bethesda, MD (301) 215-4688