Connect with us

Economy

ON THE MONEY: Baby boomers have different desires in housing

WAVE NEWSPAPERS — Unlike just 15 years ago, many baby boomers are discovering that the large, high-end homes with their high-maintenance costs no longer fit their needs as they grow older. And younger people aren’t buying big houses, either.

Published

on

By John L. Grace

Unlike just 15 years ago, many baby boomers are discovering that the large, high-end homes with their high-maintenance costs no longer fit their needs as they grow older.

And younger people aren’t buying big houses, either. It wasn’t that long ago when boomer retirees were rushing to buy or build elaborate, five or six-bedroom houses in warm climates, fueled in part by the easy credit of the real estate boom.

Many baby boomers poured millions into these spacious homes, planning to live out their golden years in houses with all the bells and whistles.

“Tastes — and access to credit — have shifted dramatically since the early 2000s. These days, buyers of all ages eschew the large, ornate houses built in those years in favor of smaller, more-modern looking alternatives, and prefer walkable areas to living miles from retail,” according to the Wall Street Journal, March 21.

The Journal opined that the problem is expected to worsen in the 2020s, as more baby boomers across the country advance into their 70s and 80s, the age group where people typically exit homeownership due to poor health or death. Boomers currently own 32 million homes and account for two out of five or 40% of the homeowners in the country.

Buyers have been led down the path of focusing on location, interest rates and inventory. The most important factor to take into consideration, however, is buying behavior based on age.

Thanks to the U.S. Census Bureau and Dent Research we can see that Americans tend to buy their first house at 31, their largest around 41 and sell those same homes at 79.

Born between 1946 and 1964, baby boomers turn anywhere from 55 to 73 this year. From 1980 to 2000 40% of all homes purchased in the U.S. were on lot sizes of a half acre to 10 acres, according to Dent Research. That is a 20-year period, where individual thinking boomers who were doing the same thing at the same time of the age group couldn’t live without their magnificent McMansions.

It stands to reason for this observer that current prices are a direct result of 76 million Americans coming into the equation. It didn’t matter whether the population was legal or illegal, legitimate or illegitimate.

With all of that demand for housing coming out of the woodwork, home prices must go up. On the other side of the equation, it becomes reasonable that when boomers who constitute 24% of the U.S. population go to heaven the supply and demand principles come back into play.

When 130 years of residential real estate remains on this earth after 76 million people go to heaven without those McMansions, you tell me where you think prices are headed.

From 1929-32 New York real estate declined 69%, wrote Zubin Jelveh in The New Republic in September 2009. That’s the same time that the stock market was off 89%, according to Yahoo Finance.

Jelveh went on to say, “A home owner who would have invested in a house on the eve of the Great Depression would not have recovered the full value of their investment until four decades later.”

If you were an adult in the early 1900s the average age of death was mid-50s, according to the U.S. Census Bureau. So you died with great regret long before prices fully recovered.

Neither of those events could ever happen again, right? Investors understand buy low, sell high. The same stock logic applies to all highly appreciated assets.

Savvy investors don’t let emotion dictate their behavior. Or you can be in the middle the pack or at the back of a herd of cows, where the view and the smell never changes.

John L. Grace is president of Investor’s Advantage Corp, a Los Angeles-area financial planning firm that has been helping investors manage wealth and prepare for a more prosperous future since 1979. His On the Money column runs monthly in The Wave.

This article originally appeared in the Wave Newspapers

Bay Area

Council Approves Additional Public Safety Investments

Councilmember Thao’s amendments included direct investments in West, Central, and East Oakland, including West Oakland Community Centers, Central Oakland traffic safety, and Oakland 911 response. 

Published

on

Stop typography on a sidewalk in Sterling Virginia during the fall photo courtesy of Obi Onyeador via Unsplash

Councilmember Sheng Thao

Councilmembers, community leaders, and city staff,  approved public safety investments for Oakland recommended by Councilmember Sheng Thao

These additions, approved Monday afternoon, included investments that align with the city’s reimagining public safety goals. The City Council unanimously approved Councilmember Thao’s budget amendments, which included investments in:

  • Traffic Calming and Sideshow Prevention
  • Faster 911 Response
  • Restoring Foot Patrol officers in business corridors during the holiday season
  • Business District Ambassadors
  • Adding Public Restrooms near homeless encampments
  • Investments to job training and resources

“My top priority is public safety, which means addressing violent crime, street safety, poverty, and homelessness,” said Thao.

“These budget amendments invest in our community and increase our Police Department’s ability to prevent and respond to violent crimes. These amendments will also protect our business corridors so Oaklanders can feel safe while they shop, and in turn, invest in our Oakland businesses.”

Said Oakland Police Chief LeRonne L. Armstrong, “I would like to thank Oakland City Council Member Sheng Thao and other Council Members for their vote and support with additional funding.

“These funds will provide walking officers in our business districts across the city during this holiday season. The funds allow us to restore much needed public safety services, walking officers, while our community and visitors shop across our city.”

Councilmember Thao’s amendments included direct investments in West, Central, and East Oakland, including West Oakland Community Centers, Central Oakland traffic safety, and Oakland 911 response.

“These amendments also help address decades of divestment from our BIPOC communities in East Oakland,” she said. “By bringing investments into street safety, beautification, and city services. It is important that we stay committed to equity for East Oakland.

“Our office made a point to work with Council President Nikki Fortunato Bas, Councilmembers Treva Reid and Loren Taylor to bring these amendments forward, and I thank them for their strong partnership in this work,” said Councilmember Thao.

 

Continue Reading

Bay Area

Where Do Negotiations Go Now After A’s “Howard Terminal” or Bust Ultimatum?

The A’s are seeking to develop 55 acres at the Port of Oakland. The proposal includes a 35,000-seat baseball stadium, which would cost $1 billion, or 8.3% of the total project.

Published

on

Oakland A's Photo Courtesy of Rick Rodriquez via Unsplash

FILE – In this Nov. 17, 2016, file photo, Oakland Athletics President David Kaval gestures during a news conference in Oakland, Calif. TheAthletics will be phased out of revenue sharing in the coming years as part of baseball’s new labor deal, and that puts even more urgency on the small-budget franchise’s plan to find the right spot soon to build a new, privately funded ballpark. Kaval, named to his new A’s leadership position last month, is committed to making quick progress but also doing this right. That means strong communication with city and civic leaders as well as the community and fan base. (AP Photo/Ben Margot, File)

John Fisher

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nikki Fortunato

Rebecca Kaplan

 

 

 

 

 

 

 

Oakland’s City Council rejected the A’s proposed non-binding term sheet, which the team had presented to the City along with an ultimatum, “Howard Terminal or Bust.”

At a packed City Council meeting last week, attended by 1,000 people on Zoom, many residents were angry at what they viewed as the A’s real estate “land grab” at the Port of Oakland and either said that the team should leave or stay at the Oakland Coliseum in East Oakland.
Rejecting the A’s term sheet, councilmembers at the July 20th meeting voted 6-1 with one abstention to make a counteroffer, approving city staff’s and Council’s amendments to the A’s term sheet.

Council’s vote was to continue negotiating with the A’s, and the A’s gained substantial concessions, $352 million, enough to return for further negotiations, in Oakland. The Council’s vote didn’t derail A’s pursuit of Las Vegas.

Now, over a week since Council’s vote, neither A’s President Dave Kaval nor owner John Fisher have spoken publically on the A’s intent to continue bargaining with Oakland for their proposed $12 billion waterfront development at Howard Terminal.

The A’s are seeking to develop 55 acres at the Port of Oakland. The proposal includes a 35,000-seat baseball stadium, which would cost $1 billion, or 8.3% of the total project.

In addition to the stadium, the development features 3,000 condominium/housing units; over a million square feet of commercial space (office and retail); a 3,500-seat performance theater, 400 hotel rooms and approximately 18 acres of parks and open space.

The most fundamental sticking point, along with all the other complications, is whether a commercial/residential development, ‘a city within a city,” in the middle of a working seaport are compatible uses for the land. Many experts are saying that the existence of upscale residences and thousands of tourists strolling around will eventually destroy the Port of Oakland, which is the economic engine of the city and the region.

According to Kaval, who had pushed for the Council to approve the ultimatum, “We’re disappointed that the city did not vote on our proposal … we’re going to take some time and really dig in and understand and ‘vet’ what they did pass and what all the amendments mean.”

Although the A’s stated a willingness to be open to the amended terms Council approved, Kaval expressed uncertainty whether the Council’s amended term sheet offers “a path forward.”

“The current [amended] term sheet as its constructed is not a business partnership that works for us,” said Kaval, saying the team would have to examine the Council’s counter-offer before deciding to resume negotiations or return to Las Vegas or focus on finding a new home someplace else.

City Council President Bas and Mayor Libby Schaaf joined city and labor leaders to discuss the Council’s vote. Vice Mayor Rebecca Kaplan made it clear that the amended term sheet the Council approved should be considered a “road map for future negotiations … a baseline for further discussions.”

Upon Kaval’s dismissal of the Council’s stated positions, Fife said, “I don’t know where we go from here,” abstaining from the vote on the proposed term sheet.

Many find Kaval’s statement confusing because he used words like partnership but apparently ignored and/or disregarded the City of Oakland – the A’s major stakeholder and a business partnership since 1968, more than 53 years.

Some are asking if the A’s understand that Oakland’s 53-year relationship with the team is the basis for the meme “Rooted in Oakland?” Are the A’s willing to accept, as the Council has determined, that the terms of the business “partnership” must be equitable and mutually beneficial for all of “us”?

And the question remains after a 53-year relationship, is it reasonable to terminate that relationship or negotiate further for an equitable and mutually beneficial business partnership?

Continue Reading

Activism

Free School Meals for All Here to Stay in California

With 1 in every 6 children facing hunger in the U.S., California is the first state to promise that every public school student — all 6 million of them – will get free school meals.

Published

on

Nancy Skinner

With 1 in every 6 children facing hunger in the U.S., California is the first state to promise that every public school student — all 6 million of them – will get free school meals.

The universal school meals program, which will launch in the 2022-2023 school year, is part of the landmark state budget agreement reached between Gov. Gavin Newsom and the Legislature last month. Days later, Maine became the second state to commit to offering a universal school meals program with the signing of its budget.

The program ensures that all students will be offered breakfast and lunch at their school, which state Sen. Nancy Skinner, D-Berkeley, said is “essential to learning.” Skinner has led the effort to establish a universal school meal program.

“We know that many California children are food insecure, and if you’re hungry you cannot learn well,” Skinner said. “The whole point of school is learning, and everything we can do to create an environment that allows children to thrive and learn is what we need to do.”

Skinner introduced a bill in March that would have established a universal school meal program. After the program garnered bipartisan support and the California Department of Finance forecast unexpectedly large projected revenues, lawmakers opted to include it in the state budget rather than as a separate bill.

The final agreement between Newsom and the Legislature calls for $650 million through the Proposition 98 fund each year to reimburse school districts starting in 2022, as well as $54 million in the 2021-22 fiscal year to supplement state meal reimbursements. Proposition 98 is the formula that determines what portion of the general fund goes to community colleges and K-12 schools.

The state program is set to begin in the 2022-23 school year because the U.S. Department of Agriculture has already committed to paying for school meals for all students through the 2021-22 school year.

The USDA has reimbursed districts for providing free meals to all students since the start of the pandemic. Before the pandemic, districts were only reimbursed for feeding students who were enrolled in the National School Lunch Program. Advocates said being able to feed students without having to check whether they qualified for free lunches allowed districts to serve more families at a time when many faced hunger and hardship.

Waiving the eligibility requirements allowed the Oakland Unified School District, for example, to distribute as many as 18,000 grab-and-go meals a day during the pandemic, said spokesman John Sasaki.

“That just goes to show the need that was there,” Sasaki said.

Previously, as part of the National School Lunch Program application process, families had to disclose their household income, how many people lived in the household, their children’s immigration status or if their children were homeless or runaways. Some families feared giving out that information, and students may have felt embarrassed to receive a free meal while others paid for it.

Schools in New York City began serving free meals to all students in 2017 after finding that some students would rather go hungry than admit they didn’t have enough money to pay for lunch. The decision followed a national outcry over “lunch shaming” — publicly shaming students for unpaid school meal bills, or even school staff throwing away their lunches rather than allowing them to eat.

Advocates believed that though 3.9 million students – 63% of California’s student body — participated in the program, the need was actually much higher.

“It’s such good news that everybody gets food with no strings attached, but to be able to do it in a way that nobody is called out is the best thing about this,” Sasaki said. “We want to make sure kids are never given a hard time for being who they are or being in the situation they are in.”

Districts will still be asking families to fill out household income eligibility forms, however. That’s because the number of families in the district that make so little that they qualify for the federal free and reduced-price lunch program remains a key factor in the state’s Local Control Funding Formula. The formula gives additional state funds to districts based on the number of low-income students, English learners, foster children and homeless youth they serve.

Tony Wold, the West Contra Costa Unified associate superintendent of business services, said the district was concerned that fewer families would fill out the household income eligibility forms because they didn’t have to in order to receive free meals. That could have potentially led to a reduction in supplemental funds for the cash-strapped district. To help solve the problem, the district had outreach workers call families directly, explaining why it was important for families to submit the information.

The outreach workers’ “big lift” resulted in more families filling out the forms than the previous year, Wold said, which kept the district’s unduplicated pupils percentage constant. That statistic measures the share of a district’s students who are low-income, homeless, foster youth or English learners — all of which drive the Local Control Funding Formula.

Outreach workers at Oakland Unified emphasize to families who are skeptical about the forms that they determine how much money goes to the classroom, Sasaki said.

California School Boards Association spokesman Troy Flint said the organization anticipates it will be harder for districts to collect income eligibility forms with the new universal meals program. The association hopes the state will provide some support to schools’ “diligent and creative efforts” to collect the forms, though the group isn’t calling for any specific change.

“This administration has prioritized steering additional money toward high-need students, particularly into concentration grants, so there’s reason to believe they might be willing to work toward a modification here,” Flint said.

Continue Reading

CHECK OUT THE LATEST ISSUE OF THE OAKLAND POST

ADVERTISEMENT

WORK FROM HOME

Home-based business with potential monthly income of $10K+ per month. A proven training system and website provided to maximize business effectiveness. Perfect job to earn side and primary income. Contact Lynne for more details: Lynne4npusa@gmail.com 800-334-0540

Facebook

Trending