Lehigh County Taxes Staying the same in 2016

Morning Call Report by Kevin Duffy

In a report by the MorningCall and Kevin Duffy, it seems that county taxes will be remaining static for 2016.

Some Highlights:

1. "As examples, he noted the Valley's 5.2 percent unemployment rate and the relocation of major companies such as Ocean Spray and Taizhou Fuling Plastics, both to Upper Macungie."

2.  "the re-establishment of the county's Aa1 rating from Moody's and upgrade from Standard & Poor's and the erasing of the $7.8 million deficit in 2014."

3. "He said the tax rate is lower in 2015 than it was 12 years ago by an average $668 per taxpayer."

Going Forward: Lehigh County has a lot of financial growth and is doing a great job with working on its debt and letting future generations deal with it. This puts the future of Lehigh County in the hands of its constituents and not debtors.

One thing I appreciated about Commissioner Muller's address is that he speaks directly and I believe that is the general tone of Lehigh Valley politics: to the point, and (hopefully) productive.  I am not exactly sure if Tom's name is just Tom or Thomas, but, I think its interesting that Kevin Duffy referred to the commissioner as Tom in his introduction in the article. I believe its indicative of a less decisive political scene.

Maybe I am looking at this for what I want to see.

-Stephen

Home Values NEED Starbucks? What? #Zillowtalk

This content was taken from Starbucks Twitter account. All Rights are theirs.

 

Reaction: The CEO of Zillow (Spencer Rascoff) and Zillow's top Economist (Stan Humphries), wrote a book Called #ZillowTalk. They mailed it to me as I am a Premier Agent with Zillow and its been great read through the first half of the book.

The Huffington Post did a precise job of summarizing the chapter but omitted how specific the radius Zillow used for their Starbucks hypothesis. There was a difference in price accretion between properties located .25 miles away and .5. The further away a property was from a Starbucks, the less the price accretion.

Starbucks Twitter Profile States: "Inspiring and nurturing the human spirit -- one person, one cup, one neighborhood at a time."

Who knew the last clause was as much a reality as much of a mission statement.

I believe Rascoff and Humphries' information is pretty cool, the authors do a great job of explaining this point further and its very convincing.  

Arbitrary Point. By my office on Hamilton Blvd a Starbucks closed a few years ago. I guess it helps Real Estate everywhere except the shopping center at Mill Creek and Hamilton. However, I think they were just early to the area, it seems the shopping center has a lot of anchor stores that have been there for a while. More than anything, the store itself had less sqf than most Starbucks I have been too,  I do not quite think it fit their model. I mean as nothing more than an anecdote. 

The Starbucks Real Estate team is interviewed in Zillow Talk and they do not pretend to be perfect with site location by any means.

-Stephen

What do you think about the 50 Shades Movie Penthouse -- Does it fit your imagination?

 

Click here for all the photos and the link to the slide show.

Courtesy of Melissa Allison at Zillow.com

Reaction: Those are some incredible common areas. The views are simply stunning. You'll notice on the one picture there is free Macy's product placement. What do you think about the pictures, is it what you imagined?

Rumor has it there would be a humungous room with a satin sheeted bed?

Happy Valentines Day.

The home that inspired Disney's UP House is Being Auctioned Off

In Real Estate, there is a term Highest and Best Use. If somebody does not make this home into an incredible coffee shop, I am just not sure that Seattle Commercial Real Estate agents are even trying anymore. #FutureStarbucks

A Link to the Story.

FHA Secretary, Julian Castro, tries to make Housing Sexy with Jon Stewart and His Audience.

Please click here for the Video

Reaction: I thought this interview was excellent. I thought Jon Stewart did an concise job of bringing up a lot of general reservations people have in regard to housing, especially for millenials. 1) Fear (from the financial meltdown), 2) capital reserves (the whole trajectory joke), 3) and cost.

In my opinion, fear isn't the greatest inhibitor for millennials buying a home. I largely believe it is a general transient spirit that prevents millenials from buying a home, in addition to student debt.

Julian, The Federal Housing Administration Secretary, is taking a pretty unsexy topic and attempting to lead a conversation that has not been established with the millennial generation.

Capital Reserves: The bit about Jon and Julian discussing trajectory probably did not make anybody feel good. For private banks, capital reserves have to be at 5% or the bank would be considered insolvent. The optimist would say loan issuance standards have been higher than in the past few years and despite that, the FHA has been able to issue enough good loans to increase the capital reserves. Sexy, right? If its hard to write a loan, and one makes all their money on loans, its impressive they are establishing a healthy and safe return.

The only input a Realtor can really give is about his buyers. To my knowledge, the buyers I know that undertook FHA loans in transactions have not defaulted on their loan. I would certainly like the FHA to have a higher Capital Reserve but it seems folks seem to be handling the current FHA loan product. In addition, hopefully Dodd-Frank has weakened derivative trading -- which it seems to have succeeded in doing based on Fortune 500 Bank companies reporting challenging earnings, often because of their trading desk. In short, the banks are having trouble making money trading assets like mortgages.

John poignantly asks Julian about banker's trading mortgages, which is what caused the 2008 Crisis, I think Julian could have done a better job answering that question. However, its a difficult question to answer simply.

Cost: Castro's primary intent was to discuss lowered mortgage insurance rates on FHA loans. Those insurance rates have gone down, so its now cheaper to have a low down payment loan through FHASo there you go millenials, its cheaper to buy a loan.

Feel free to ask me about the difference in FHA and Conventional loans. Or to share your take on the interview!

A Somewhat Contrarian View on Interest Rates. CEO of Goldman Sachs, Lloyd Blankfein

 Belvedere M. (2015, January 7). Squawk Box. New York, New York. CNBC

Click here for the Video 

 Summary:

Lloyd Blankfein: "I would take a lot of risk on the inflation side."  , "Sustaining it and trying to recapture the momentum."

The popular opinion is rates should go up. However, I think the Goldman Sach's CEO has a great point about momentum. The Fed has few monetary policy bullets left, and manufacturing a stall in the economy because of interest rate manipulation could be exacerbated by the Fed lacking options to boost the economy.

I believe this perspective on momentum placates a slower rise of interest  rates and reduces the urgency to buy homes because the rates might not move quickly.

I like this perspective as its the opposite of a lot the conventional wisdom I hear.

Here are Blankfein's opinion on how Oil impacts other parts of the economy