Published: Thursday, November 15, 2007
SEA ISLE CITY - The city is still in line to get its first major beach-replenishment project, but only because the U.S. Senate and the House of Representatives voted to override a presidential veto of the authorization bill.
Mayor Len Desiderio was on an airplane on his way to Florida last week when he heard about the 361-54 House vote overriding President Bush's veto of the Water Resources and Development Act, or WRDA. Two days later, the Senate also voted to override the veto.
That means the $136 million needed to refurbish beaches in Sea Isle City and Strathmere has been authorized, although an appropriations bill still must be passed. Desiderio expects this to happen in 2008 or 2009. He said it can't come soon enough.
"It's extremely important to Sea Isle City to get this. We're counting on the money to help our beaches. Erosion is bad, from the north end to the south end," said Desiderio, speaking from Naples, Fla., on Wednesday.
Desiderio has seen Avalon, Ocean City, Cape May, Cape May Point and other towns get sand from U.S. Army Corps of Engineers Beach projects. The key is to get such a project authorized under a WRDA bill. Once it is authorized, the funding usually follows.
This was the second time U.S. Rep. Frank LoBiondo, R-2nd, has voted to override a presidential veto in the past few months. The first involved children's heath insurance.
"This bill includes several provisions that are critical for South Jersey, especially the residents of Sea Isle City whose property and businesses are threatened daily by beach erosion. It was never a question to me to vote to override the president on this important bill. The serious concerns of my district and my constituents always come first," said LoBiondo.
Bush said the bill "lacks fiscal discipline" and makes American taxpayers support "a pork-barrel system" of authorization and spending when the merit of a project is an afterthought. Bush noted the bill went into conference at $14 billion to $15 billion and ballooned to over $23 billion.
Bush, who has been a critic of beach replenishment, said the bill could hinder other Army Corps priorities such as providing hurricane protection to New Orleans, restoring the Everglades and reducing flood damage in Sacramento.
But the bill does not only restore beaches in southern New Jersey. LoBiondo notes it also includes funding to clear debris from the Delaware River where a discarded anchor caused a major oil spill a couple of years ago. Such spills often threaten the fishing industry and shore tourism. It also includes money to revitalize the Delaware Bay oyster industry.
Several other beach projects are in the WRDA bill, including adding six beaches in Cape May Point to a periodic sand-pumping schedule. An already authorized project pumps sand from Cape May to Central Avenue in Cape May Point. This would extend the pumping past Central Avenue.
The bill also would extend an experimental beach program that has funded artificial concrete reef structures in Cape May Point. It would also provide funds to remove the structures when they fail. This would help Cape May Point remove a reef that was installed incorrectly and sank.
A provision from LoBiondo also keeps the federal government paying for 65 percent of the beach projects, with state and shore towns paying the other 35 percent. There have been attempts to reverse this so the federal government only pays 35 percent.
Lobiondo has also inserted language making it clear that periodic beach replenishment is a "federal priority." Bush, and President Clinton before him, tried to get the government out of the beach business.
Opponents of the projects argue the pumping only protects the second homes of rich people, while shore tourism interests point to the huge impacts beaches have on the economy and a reduction in federal flood insurance claims in towns with restored beaches.
Thursday, November 15, 2007
Tuesday, November 13, 2007
The Real Estate Long View
The Long View
by Lawrence Yun, Vice President, NAR Research
“How much have real estate investors lost due to the housing market bust?”
That was the (highly loaded) question posed to me recently by a producer of one of the major evening news programs. The show wanted to run a story about the "pains" being felt in the market.
Hmm. Well, exactly how much real pain are we talking about? Let's look at a couple of examples. An investor who bought a property in Las Vegas five years ago would be ahead by $150,000; up $200,000 in Miami. The average investor nationwide – up $54,000. Only the recent buyers (flippers) who bought last year in few specific markets would have encountered a loss.
Not All Losses Are Created Equal
I’m not discounting the discomfort of those who lost big, especially lenders and hedge funds who had large exposures to subprime loans. Investors in homebuilder stocks have certainly experienced pains. But nearly all real estate investors who have a reasonable holding period are doing quite fine. Some of these fortunate buyers who got into the market several years ago will still consider a modest give back as a loss without considering the large gains reaped during the housing boom. That’s the nature of the human mind. A gain of $190,000 in Miami feels like a $10,000 loss considering that the gain had been $200,000.
A Home is Not a Stock Certificate -- Thank God!
Foreclosures are rising and construction workers are being laid off. REALTORS® are feeling the pinch as well. The median income of a typical REALTOR® has been falling due to the correction in sales transactions. However, consumers and homeowners who are in it for the long-term are once again coming out well ahead.
Because of the power of leveraging, $10,000 used for a down payment on a typically priced home in the United States at a typical appreciation rate of 5 percent will return $110,000 after 10 years. The same $10,000 invested in the stock market appreciating 10 percent annually will result in $23,600. No wonder the data from the Federal Reserve show consistent results year-after-year of the staggering difference in net worth between homeowners and renters. A typical homeowner had $184,400 in net worth versus only $4,000 for a typical renter.
The Spooky Thing
The lack of buyer confidence to enter the market has been the one principal reason in holding back home sales. Many would-be buyers are spooked of a possible home price decline. And the media is fueling that fear. Some of the most popular market gurus who offer their advice on television and other media say so. Caution is in order, however. As a recent Barron’s article pointed out, stock picks made by one such expert actually underperformed the market.
Opportunities to Seize
It’s also important to point out that times of crisis often turn out to have been times of opportunity in hindsight. With over four million net new job additions in the past two years– the time frame during which home sales have steadily fallen – a significant pent-up demand has developed. Home sales and home prices will be higher in 2008 compared to 2007. And, as with any investment, look longer term. Those investing in a home and keeping it for a typical holding period of six to ten years will likely see their investment pay off; those homes will have been a good investment.
As for stocks, they are not the enemy of real estate. Many REALTORS® own stocks. (So do many economists!) The latest NAR research on vacation-home buyers reveals that many of them rely on stock market wealth to fund that second-home purchase. Stocks and real estate both promote the importance of private ownership.
Where to Throw the Darts
Of course, with housing figures down, all eyes at looking to the stock market. Indeed, the stock market is at an all-time high. That's terrific in and of itself and reflects confidence in the U.S. economic outlook. Just be careful about taking specific advice from any hyper-emotional TV personality. Darts should not be thrown at publicity posters of any "mad money" host. You’ll likely have just as good of luck by reining in your emotions (and money) and throwing them randomly on the financial pages of your newspaper for your next stock pickings.
by Lawrence Yun, Vice President, NAR Research
“How much have real estate investors lost due to the housing market bust?”
That was the (highly loaded) question posed to me recently by a producer of one of the major evening news programs. The show wanted to run a story about the "pains" being felt in the market.
Hmm. Well, exactly how much real pain are we talking about? Let's look at a couple of examples. An investor who bought a property in Las Vegas five years ago would be ahead by $150,000; up $200,000 in Miami. The average investor nationwide – up $54,000. Only the recent buyers (flippers) who bought last year in few specific markets would have encountered a loss.
Not All Losses Are Created Equal
I’m not discounting the discomfort of those who lost big, especially lenders and hedge funds who had large exposures to subprime loans. Investors in homebuilder stocks have certainly experienced pains. But nearly all real estate investors who have a reasonable holding period are doing quite fine. Some of these fortunate buyers who got into the market several years ago will still consider a modest give back as a loss without considering the large gains reaped during the housing boom. That’s the nature of the human mind. A gain of $190,000 in Miami feels like a $10,000 loss considering that the gain had been $200,000.
A Home is Not a Stock Certificate -- Thank God!
Foreclosures are rising and construction workers are being laid off. REALTORS® are feeling the pinch as well. The median income of a typical REALTOR® has been falling due to the correction in sales transactions. However, consumers and homeowners who are in it for the long-term are once again coming out well ahead.
Because of the power of leveraging, $10,000 used for a down payment on a typically priced home in the United States at a typical appreciation rate of 5 percent will return $110,000 after 10 years. The same $10,000 invested in the stock market appreciating 10 percent annually will result in $23,600. No wonder the data from the Federal Reserve show consistent results year-after-year of the staggering difference in net worth between homeowners and renters. A typical homeowner had $184,400 in net worth versus only $4,000 for a typical renter.
The Spooky Thing
The lack of buyer confidence to enter the market has been the one principal reason in holding back home sales. Many would-be buyers are spooked of a possible home price decline. And the media is fueling that fear. Some of the most popular market gurus who offer their advice on television and other media say so. Caution is in order, however. As a recent Barron’s article pointed out, stock picks made by one such expert actually underperformed the market.
Opportunities to Seize
It’s also important to point out that times of crisis often turn out to have been times of opportunity in hindsight. With over four million net new job additions in the past two years– the time frame during which home sales have steadily fallen – a significant pent-up demand has developed. Home sales and home prices will be higher in 2008 compared to 2007. And, as with any investment, look longer term. Those investing in a home and keeping it for a typical holding period of six to ten years will likely see their investment pay off; those homes will have been a good investment.
As for stocks, they are not the enemy of real estate. Many REALTORS® own stocks. (So do many economists!) The latest NAR research on vacation-home buyers reveals that many of them rely on stock market wealth to fund that second-home purchase. Stocks and real estate both promote the importance of private ownership.
Where to Throw the Darts
Of course, with housing figures down, all eyes at looking to the stock market. Indeed, the stock market is at an all-time high. That's terrific in and of itself and reflects confidence in the U.S. economic outlook. Just be careful about taking specific advice from any hyper-emotional TV personality. Darts should not be thrown at publicity posters of any "mad money" host. You’ll likely have just as good of luck by reining in your emotions (and money) and throwing them randomly on the financial pages of your newspaper for your next stock pickings.
Friday, November 2, 2007
Renting from Laricks has never been easier!
Laricks Property Management has simplified the reservation process. For our many clients who take advantage of our online rental search and reservation website, we have also provided the option to send leases by email and to accept credit cards for payments. Our goal is to create a fast, simple and stress free way to plan your next summer vacation in Sea Isle City!
Find out how easy it is by clicking on the rental button at the top of our website.
Find out how easy it is by clicking on the rental button at the top of our website.
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