The Student Loan Deby Dilemma

Market Matters

Making California housing affordable again will require new laws Source: Orange County Register California can increase the number of homes that people can afford by giving more money to cities that build sufficient affordable housing, some said at a housing summit last week in Los Angeles by the CALIFORNIA ASSOCIATION OF REALTORS®. Or cutting off funding to those that don’t. Or by allowing developers to bypass the local process in cities and counties with insufficient affordable housing. Allowing single-family homeowners to build and rent out granny flats. And by streamlining the approval process for affordable housing projects. Joel Singer, the association’s longtime chief executive, spelled out two stark facts threatening the Golden State: California ranks 49th in the nation in homeownership rates. And 50th in affordability rates. “Where are our children going to live?” Singer asked. Read the full story

Californians fleeing high cost of housing Source: Mercury News For every home buyer coming into California, another three are selling their homes, packing up and moving out, according to data analysis firm CoreLogic.The trend of out-migration was also noted in a separate trio of reports released earlier this year by Beacon Economics. Beacon noted that 625,000 more U.S. residents left California between 2007 and 2014 than moved into the state. The vast majority ended up in Texas, Oregon, Nevada, Arizona and Washington. The search for more affordable housing is sending low and middle-income workers out of the state, while higher-wage workers continue to move in, which argues against the theory that high taxes are driving people away. Home prices and rents have been rising steadily for more than four years. Read the full story

Is home equity still a retirement failsafe? Source: RISMedia A recent study by the Urban Institute explored homeownership as a viable path to a secure retirement, but many older homeowners missed the prime opportunity to leverage that equity before the recession. How much usable equity can older homeowners now expect in retirement, given the rebound in home values? Homeowners aged 65 or older, according to the study’s findings, could have used their home’s equity to grow their retirement income by over 50 percent (up to $60,000) pre-recession, either by borrowing a home equity line of credit, selling their home at a profit, or taking a cash-out refinance or second mortgage. That percentage dropped to 40 percent (up to $49,000) by 2012, despite accumulating an average 10 percent more equity then than in 1998. Home values, still, grew 3 percent by 2014. Monetarily, the average older homeowner’s equity stake increased from $117,000 to $166,000 between 2000 and 2006, then decreased to $129,000 by 2012. Read the full story

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