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By Tom Ramsey | Broker in Portland, OR
  • 6.5 million homes at risk from storm surges By Les Christie @CNNMoney July 10, 2014: 11:30 AM ET

    Posted Under: Quality of Life, Home Buying  |  July 11, 2014 6:52 AM  |  74 views  |  No comments
    Your video of superstorm Sandy 
    Your video of superstorm Sandy
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      NEW YORK (CNNMoney)

      Every summer, residents along the Gulf of Mexico and Atlantic Ocean coasts brace themselves for the hurricane season. An analysis of storm surges found that 6.5 million single family coastal homes are at risk from flooding during this year's hurricane season, according to property researcher CoreLogic.

      Given that oceanfront homes are among the most valuable properties along the coasts and also in the front line of incoming storms, the costs related to such flooding are also high.

      Flooding's potential costs
      5 States with highest potential reconstruction costs
      StatePotential reconstruction costs
      Florida$491 billion
      New York$182 billion
      Louisiana$161 billion
      New Jersey$92 billion
      Texas$77 billion
      Source: CoreLogic's 2014 storm surge analysis 

      Floods from storm surges represent a collective $1.5 trillion in potential reconstruction costs, CoreLogic said.

      Related: For sale -- dream beach homes

      When tropical storms strengthen, their winds and low pressure causes water to gather. The mass of water can strike the shore and surge over low-lying lands.

      Even when hurricanes are not in the highest category, storm surges can occur, warns Thomas Jeffrey, a senior hazard scientist for CoreLogic.

      Related: Wilder weather, smaller losses in 2013

      The forecast for this season is for slightly less storm activity than normal.

      "But the early arrival of Hurricane Arthur on July 3 is an important reminder that even a low-category hurricane or a strong tropical storm can create powerful riptides, modest flooding and cause significant destruction of property," he said.

      Superstorm Sandy is a prime example. By the time it hit the Atlantic Coast in 2012, it did not even meet the strict definition of a hurricane but still managed to do an estimated $68 billion in damage from the water surge it caused along the coast line. Only Katrina, the costliest natural disaster in U.S. history, cost more.

      Related: Which natural disaster is likely to destroy your home?

      There are 19 states in the paths of the Atlantic and Gulf storms.

      Densely populated Florida, with its shallow elevation, is most at risk. There are 2.5 million homes that could get hit with a potential damage cost of nearly $500 billion.

      A couple tries to rebuild after Sandy 
      A couple tries to rebuild after Sandy

      Other vulnerable states are Louisiana, where 750,000 homes are at risk, New York had 466,919 homes, New Jersey 445,928 and Texas 434,421. 

  • US homebuilder confidence rises slightly in April

    Posted Under: Quality of Life, Home Buying  |  April 16, 2014 10:14 AM  |  156 views  |  No comments
    pennsylvania homes.jpg
    This Oct. 18, 2011 photo, shows new home construction in a development in Canonsburg, Pa. (The Associated Press)
    PrintThe Associated PressBy The Associated Press 
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    on April 15, 2014 at 8:38 AM, updated April 15, 2014 at 8:40 AM



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    WASHINGTON — U.S. homebuilders' confidence in the housing market rose modestly in April but remained at low levels for the third straight month, constrained by tight credit for home buyers and a shortage of workers and available land.

    The National Association of Home Builders/Wells Fargo builder sentiment index, which measures confidence in the single-family home market, edged up to 47 in April from 46 in March, the homebuilders group reported Tuesday.

    Readings below 50 mean builders view sales conditions as poor.  The index had been above 50 from June through January.

    Builders recently have complained that they can't find enough workers or lots to build on.

    Many home buyers also have had trouble qualifying for mortgages. The homebuilders' index of traffic by prospective buyers stayed at 32 in April.

    The latest reading, based on responses from 301 builders, comes as the spring home-selling season gets going. The season typically sets the pattern for residential hiring and building construction in the ensuing months. The overall confidence index was below 50 in all four regions of the United States — 36 in the Northeast, 45 in the West and 48 in the Midwest and South.

    "Builder confidence has been in a holding pattern the past three months," said Kevin Kelly, chairman of the homebuilders association and a developer from Wilmington, Del.  "Looking ahead, as the spring home buying season gets into full swing and demand increases, builders are expecting sales prospects to improve in the months ahead."

    The index measuring their confidence in home sales over the next six months rose to 57, highest since January.

    Housing, while still a long way from the boom of the mid-2000s, has been recovering. Residential construction has grown at double-digit rates over the past two years and contributed about one-third of a percentage point to overall economic growth in both 2012 and 2013.

    Though new homes represent only a fraction of the housing market, they have an outsize impact on the economy. Each home built creates an average of three jobs for a year and generates about $90,000 in tax revenue, according to data from the homebuilders association.

    -- The Associated Press
  • Cut the cost of home maintenance

    Posted Under: Quality of Life, Remodel & Renovate, Home Ownership  |  February 14, 2014 6:59 AM  |  281 views  |  No comments

    Upgrade to lower costs


    low maintenance home

      Homeowners once had to make a choice: the beauty of genuine wood and stone, or the easy maintenance of a man-made alternative.

      Installing vinyl siding over wood shingles, for example, meant you'd never have to repaint again, but also required sacrificing architectural charm -- and possibly getting kicked off your neighbor's dinner party guest list.

      Now, though, you can have it all. A new breed of manufactured products available at home centers and specialty shops looks realistic enough to preserve or even boost your home's appearance.

      While some of these modern materials are pricier than the natural versions, they will save you money and effort over the long term.

      Plus, "it's a compelling one-two punch for selling," says Lake Forest, Ill., realtor Carol Russ. "The traditional looks draw buyers in, and then I tell them that they're actually seeing new, super-durable materials."

      On the slides that follow, you'll find six imitations that might be better than the real deal.

    • Not all housing bubbles crash equally

      Posted Under: Quality of Life, Market Conditions  |  February 12, 2014 10:03 AM  |  230 views  |  No comments

      Four reasons why a collapse in China's home prices won't spell global disaster.

      By Shang-Jin Wei


      FORTUNE -- As China's home prices soar to record highs and well beyond the reach of ordinary citizens, the world watches closely as many wonder if the housing market might eventually crash. The global economy is still recovering from the financial crisis triggered largely by the collapse of America's housing market, and it's easy to see why investors and economists would worry that a similar boom-and-bust scenario in China could deepen the lingering slump.

      Such concerns, though, are premature at best. Is there a bubble in China's housing market? It's possible, especially in major cities, such as Shanghai, Beijing, Shenzhen, and several provincial capitals. But China's economy is far different from America's; should a real estate bubble in China suddenly burst, the following differences could temper the risks of another global disaster:

      China's saving propensity might save the day

      Declining home prices erode what's called the "wealth effect." If home prices drop, theoretically homeowners feel less wealthy so they consume less, which in turn, leads to an economic slowdown. The U.S housing crash in 2007 damaged the wealth of countless Americans, but such spillovers likely won't be as deep in China because the country saves far more than most other countries.

      MORE: Fear be damned: This is the best time to invest in emerging markets

      Most Chinese don't enjoy the kind of retirement plans and other social safety nets that most Americans do. So they tend to rely on savings and their children for financial security. In addition, they also save to help their children in their competition for marriage partners. As the ratio of males and females in the youth cohort rises due to gender-selective abortions, the competition for brides is getting fiercer for families with a son, and the competitive savings have risen in importance relative to the precautionary savings. Because of these factors, Chinese households save a greater fraction of their incremental wealth than most other countries.

      As home prices rise, incremental consumption as a share of incremental wealth in China is smaller than in the U.S. For the same reasons, if home prices were to fall, the decline in consumption as a share of a decline in housing wealth may also be smaller than in the U.S.

       An affordable housing program can partially offset a slump

      A housing bust could also disrupt input-output linkages -- when home prices collapse, the ramifications could ripple across the construction industry, leading to reduced demand for steel, cement, and appliances. China isn't immune, but the government's ambitious affordable housing program could cushion the blow to the wider construction industry. This program is meant to help address income inequality. To build these houses, you need cement, steel, and eventually furniture. To the extent that a price correction occurs in the normal housing market, the construction of low-income housing will at least partially offset any potential negative effect.

      China's banks can manage bad home loans

      As we saw in the U.S., a collapse in home prices nearly destroyed the nation's financial system as loans to real estate developers and homeowners turned sour.

      In China, loans to real estate developers and mortgage loans to homeowners altogether account for about 20% of all bank loans. Suppose 20% of these loans go bad, which is an aggressive assumption given that subprime loans in the U.S. accounted for less than 20% of all banks' loans during the subprime crisis of 2007-2008 (and not all subprime loans went bad); this will produce 4% of bad loans.

      While this is not negligible, China's banking sector should be able to work itself out, perhaps with the government's help. The fact that China's government debt burden is much lower than the U.S., Europe, or Japan is important here. After all, the Chinese banking sector got itself out of a far more serious bad loan problem a decade ago.

      MORE: Why Greeks are overworked while Germans go home early

      Policymakers don't sit idle

      Chinese government policies are not fixed either. In the last few months, the country's central bank has tightened its expansionary monetary policies used to counter the global economic slowdown. It did so because it made a judgment that risk in the housing market was not very big. If it sees signs of a housing price correction and a potential negative effect on the overall economy, it can reverse course.

      Bubbles are an inevitable byproduct of a market economy, especially when the underlying asset is hard to sell short (such as housing in China). However, even if a housing price correction comes, it won't have the same impact on the overall economy that we experienced when the U.S. and European markets collapsed.

      Shang-Jin Wei is the director of Columbia Business School's Jerome A. Chazen Institute of International Business and the NT Wang Professor of Chinese Business and Economy.

    • Who pays for damage from a meteor?

      Posted Under: Quality of Life, Home Buying, Property Q&A  |  March 8, 2013 11:00 AM  |  276 views  |  No comments

      NEW YORK (CNNMoney)

      If your house is hit by a space object -- such as the remnants of the meteor that stunned people in the Urals region of western Siberia -- it won't be a major hit to your bank account.

      "Your insurance covers falling objects," said Robert Hartwig, president of the Insurance Information Institute.

      Meteorites -- which are rocks formed after a meteor burns in the earth's atmosphere -- have crashed through roofs rarely over the years. But when they do, insurers paid for the damage if people had homeowners' policies, according to Hartwig.

      A more common problem is "blue ice," the frozen sewage that occasionally falls from planes. That is also covered if it falls on your house, said Hartwig.

      The event in Russia was the most serious one in many years, a once-in-a-century event, according to Laurie Leshin, a former NASA scientist and Director of the Center for Meteorites Studies at Arizona State University. It injured more than 700 people and damaged nearly 300 buildings, according to the state-run RIA Novosti news agency.

      Space objects rain down on earth all the time, but rarely do they injure people or damage property, according to Leshin, who is now Dean of Sciences at Rensselaer Polytechnic Institute.

      "The earth is pelted with 40 tons of space debris a year," she said. "Most of that is in teeny dust particles."

      To do real damage, a meteor usually has to be bigger than a Volkswagen when it enters the atmosphere, she said.

      "There was a case where a meteor(ite) crashed through a roof, bounced off a sofa and hit somebody in the leg," said Leshin. "But I know of no cases in which anyone was killed."

      Russia seems to attract meteors. A 1908 explosion over Siberia was the largest impact event in recorded history, with estimates of the energy released from the blast equivalent to as much as 1,000 times that of the atomic bombs dropped on Hiroshima.

      It devastated an area nearly the size of Rhode Island. If that happened in even a sparsely populated part of the United States, it would be cataclysmic, said Hartwig.

      "That would be an extraordinarily expensive event for the insurance industry," he said. To top of page

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