Posted by Hamza Ashfaq · June 04, 2019 1:59 PM
BY TED THURN ON MAY 29, 2019
Rent control is often considered by some state and local government officials as a means to create more affordable housing by limiting the amount a property owner can charge for renting out a home, apartment, or other type of real estate. As rental rates rise, demand for apartments increases and Americans see a larger portion of their income go to paying rent. As policymakers search for answers to combat this growing problem, one of the first solutions they consider is rent control.
Over the last few years, property managers and owners have addressed rent control legislation in their respective states. Rent control (also known as rent stabilization) is a government-enforced price control measure limiting the price of rents that property owners may charge for rental housing.
The theory behind rent control is to allow certain tenants to reside in an area that may otherwise be out of reach. With rent control, the rent charged to a tenant who lives in qualified housing is strictly regulated, with a maximum placed on the amount the landlord may charge the tenant. Therefore, rent control is effectively a price ceiling imposed by the governing entity.
During the 2019 legislative session, several states introduced bills to establish rent control; Oregon and Illinois are two of those states. At first glance rent control appears to be a quick fix to provide instant housing affordability. However, a closer examination shows the many negative, unintended consequences of rent control that can result in a significant reduction of affordable rental housing, along with other problems.
Ted Thurn is director of government affairs for the Institute of Real Estate Management
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Posted by Hamza Ashfaq · June 04, 2019 1:53 PM
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Posted by Hamza Ashfaq · June 04, 2019 1:51 PM
BY BRAD BECKETT ON MAY 30, 2019
For the 6th year in a row, Gallup is reporting that more Americans prefer real estate over other long-term investment vehicles for growing wealth. These numbers broken down show that 35% prefer real estate, 27% prefer the stock market, 15% prefer CDs/bank accounts, and 14% prefer gold.
“Gallup has asked a version of the best investment question since 2002, and Americans’ choices have varied, largely in response to the performance of the various investment options. In 2002, as housing prices were increasing rapidly, 50% of U.S. adults said real estate was the best investment, the highest percentage choosing any investment type in a single year in Gallup’s trend. Five years later, as the real estate bubble was about to burst after values peaked, housing still ranked first but with fewer Americans, 37%, choosing it.”
Click here to read the full story at Gallup.com.
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Posted by Hamza Ashfaq · June 04, 2019 1:43 PM
BY BRAD BECKETT ON MAY 28, 2019
The U.S. Government is reporting that sales of new single-family houses in April, 2019 were at a seasonally adjusted annual rate of 673k, which is 6.9% lower than March’s revised figure. The median sales price of new houses sold in April 2019 was $342,200 and the average sales price was $393,700. There was an estimated 332k new houses for sale at the end of April representing a 5.9 months supply at the current sales rate.
Click here to read the full report at Census.gov.
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Posted by Lacy O'Leary · May 24, 2019 10:21 AM
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Posted by Lacy O'Leary · May 24, 2019 9:50 AM
A recent report by Bloomberg says that Puerto Rico wants to shift $400 million of its federal aid toward Opportunity Zone projects. According to the report, PR’s Governor, Ricardo Rossello, is currently seeking federal approval to create a fund to invest community development block grant funds into such projects. In addition, the governor signed a bill earlier this month to create a regulatory framework for opportunity zone investments in Puerto Rico. Indeed…
“The opportunity zone program was created as part of the 2017 Tax Cuts and Jobs Act to bring development dollars to areas of need, and nearly the entire island of Puerto Rico qualified.”
Click here to read the full story at Bloomberg.
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Posted by Lacy O'Leary · May 20, 2019 11:11 AM
The U.S. Department of Housing and Urban Development recently announced a package of incentives to encourage multi-family property owners to invest in thousands of neighborhoods located in Opportunity Zones across the nation. According to the release (reprinted below) the FHA is introducing reduced application fees paid by property owners applying for certain multifamily mortgage insurance programs for the development or rehabilitation of apartment units located, or proposed to be located, in Opportunity Zones. We will continue to closely cover this issue and post news and updates.
WASHINGTON – The Federal Housing Administration (FHA) today announced a package of incentives to encourage multi-family property owners to invest in thousands of neighborhoods located in Opportunity Zones across the nation. Read today’s Housing Notice.
FHA is introducing reduced application fees paid by property owners applying for certain multifamily mortgage insurance programs for the development or rehabilitation of apartment units located, or proposed to be located, in Opportunity Zones. In addition, FHA is designating teams of senior underwriters to review these applications to ensure the most attentive and timely processing.
When more investors can apply for benefits in Opportunity Zones, more investors can supply benefits in Opportunity Zones. And that’s exactly the intention of today’s Notice,” said Secretary Carson. “These FHA incentives, combined with the preference points HUD already offers grantees for activities in Opportunity Zones, show how this Administration is maximizing the power of public-private partnerships to never forget – and always lift up – our nation’s “the forgotten men and women.”
Reduced Application Fees
Applicants to FHA’s New Construction and Substantial Rehabilitation (Section 221(d)(4)), Urban Renewal and Concentrated Development (Section 220), and Purchase or Refinance of Existing Multifamily Property (Section 223(f)) multifamily mortgage insurance programs will be eligible for significantly lower application fees provided the property is located within qualified Opportunity Zones. For transactions that are defined as ‘broadly affordable,’ FHA’s application fee will be reduced from the current $3 per thousand dollars of the requested mortgage amount to $1 per thousand dollars of the requested mortgage amount, resulting in an average cost saving to applicants of approximately $28,000. ‘Broadly affordable’ is defined as developments in which at least 90 percent of the units are Section 8-eligible or deemed affordable under the Low-Income Housing Tax Credit (LIHTC) program.
“When more investors can apply for benefits in Opportunity Zones, more investors can supply benefits in Opportunity Zones. And that’s exactly the intention of today’s Notice,” said Secretary Ben Carson. “These FHA incentives, combined with the preference points HUD already offers grantees for activities in Opportunity Zones, show how this Administration is maximizing the power of public-private partnerships to never forget – and always lift up – our nation’s “forgotten men and women.”
For ‘market rate’ and ‘affordable’ transactions, FHA will reduce application fees from $3 to $2 per thousand dollars of the requested mortgage amount, resulting in an estimated average cost savings of $14,000. Read more about the definitions of broadly affordable and affordable in the Federal Register.
Designated Senior Underwriters
FHA will designate seasoned underwriters to process applications located in Opportunity Zones to ensure expert and expedient reviews. Applications must meet the following criteria to qualify for reduced fees and designated underwriting:
- The application is submitted under FHA’s Section 221(d)(4), Section 220, or Section 223(f) program for a property located in, or proposed to be located in, a qualified Opportunity Zone, and/or:
- The application involves an investment from a Qualified Opportunity Fund (QOF).
The new incentives offered by FHA are available immediately for applicants of market-rate properties that have not yet submitted a pre-application, and for applicants for affordable properties that have not yet applied. Opportunity Zones Created under the 2017 Tax Cuts and Jobs Act, Opportunity Zones are intended to stimulate economic development and job creation in distressed low-income communities by incentivizing long-term capital investment. The program offers capital gains tax relief to those who invest in these targeted distressed areas. This program is anticipated to spur approximately $100 billion of private capital investment in Opportunity Zones. There are more than 8,700 census tracts designated as Opportunity Zones in all 50 States and in the U.S. territories. Read more about the Opportunity Zones program.
Click here to read the full release at HUD.gov.
Click here to learn more about Opportunity Zones.
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Posted by Lacy O'Leary · May 20, 2019 11:08 AM
What home technology features are buyers looking for? According to data from the latest issue of the NAHB’s, What Home Buyers Really Want, 46% said security camera was at the top of their list, followed closely by a video doorbell. The study is based on a survey that asked recent and prospective home buyers about the features that they would like in a home and a community.
“…three of the four most wanted features are security-related: along with a security camera, a video doorbell and a wireless home security system are wanted by at least 40 percent of home buyers. However, at most 21 percent of home buyer currently have any one of these technology features installed, indicating that there is market growth potential for these items.”
Click here to read the full story at the NAHB’s Eye on Housing.
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Posted by Lacy O'Leary · May 20, 2019 11:05 AM
Brian Hamrick
Short-term vacation rentals like Airbnb have become very lucrative for real estate investors. On a recent Rental Property Owner & Real Estate Investor podcast, Brian Hamrick interviews Beth Carson, a well-known expert on the subject of of Short-Term & Vacation Rentals. She has been in the hospitality industry for 18 years working with mini-resorts and high-end homes, and has helped investors go from losing millions a year to being profitable in one month. During the interview she explains in detail about how she discovered the “the power of the vacation rental marketing machine.” Her advice is spot-on for anyone looking to get into short-term rentals.
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Posted by Lacy O'Leary · May 10, 2019 9:50 AM
We see a lot of these “is it better to rent or buy” stories from time to time and we have covered them.However, the bottom line is that it’s all about the local market conditions. To that end, the folks over at howmuch.net crunched the numbers to provide an intuitive look at the geography of renting vs. owning. They looked at factors such as student loan debt, financial insecurity, and high housing prices which they say disincentivizes some would-be homeowners. In fact, howmuch.net concludes it is cheaper to rent than to buy in most states. Indeed…be sure to look at all their data.
Click here to read the full report at howmuch.net.
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