Now, property records show that on Oct. 14 Witherspoon sold the larger part of the A-list compound, which includes a five-bedroom, six-bathroom, 6,956-square-foot Spanish-style estate, and adjacent lot tucked away at the end of a quiet cul-de-sac on a double lot in the desirable, guard-gated and celebrity-friendly Brentwood Circle. (See the slideshow below.)
If you think your pricey Halloween costume is going to set you back, just wait until you see how many costs come with buying a home. Buying a property is likely the largest financial decision you will make in your life and it's important to do so thoughtfully. From how much house you can afford to which neighborhood is right for you, it's important to consider each aspect carefully. Check out the reasons you may regret your decision to buy a home down the road.
1. If You Lose Your Job: Job security should be one of your first thoughts before you purchase a home. If you have reason to believe that you may be out of a job in the foreseeable future, now is probably not the right time. Mortgage lenders are not forgiving on missed payments and it's a good idea to buy a home only when you are confident in your employment status or ability to afford your monthly mortgage for the future.
2. If You Need to Move - Again: When you make a home purchase, it's generally a good idea to stay put for at least several years. A buy or rent calculator can help you determine what is the break-even point for you. That's the number of years when it makes more sense for your net worth to buy instead of continue renting. Buying a property is generally a long-term commitment and probably not for you if you find yourself frequently changing cities. If you have to sell a recently purchased home on short notice it can be difficult to do without absorbing a big loss. Renting may be the better option for you if you find yourself moving more often than staying put.
3. If You're in an Unstable Relationship: Although many single people buy homes, this is often a decision made with a partner or spouse. If your relationship with the person you're buying a home with is unstable or the reason you are in a certain area (significant other, family) is not secure, you could face serious buyer's remorse in the near future.
4. If You Have a Lot of Debt: Whether your debt is of the student loan, credit card or private loan variety, high debt ratios are a sign that you may want to hold off on making such a large financial commitment. If your expenses consume more than 50% of your income each month, you probably can't secure a mortgage anyways (and even if you do it will likely be at a higher interest rate, which can cost you thousands of dollars over the life of your loan). It's a good idea to try paying down your debts before buying a home.
Remember, you don't have to buy a house. If your current personal, financial or employment situation is shaky, you may want to hold off on the purchase for now. Run the numbers to see what's best for you. Be scared for the right reasons this Halloween season -- not because you have found yourself in a costly housing situation that isn't right for you.
AJ Smith is an award-winning journalist with more than a decade of experience in television, radio, newspapers, magazines and online content. She currently serves as the managing editor for SmartAsset.
The Oscar winners haven't moved far, and when it comes to architecture, they're staying traditional. Their former home was a brick center-hall Colonial; the new place is also a Colonial, but more than twice the size. (See the slideshow below.)
One of Westchester County's most illustrious properties, the 19th-century estate spans 15,458 square feet with eight bedrooms, 13.5 baths, equestrian facilities, magnificent gardens, a greenhouse, tennis court and pool. The interior has been renovated, mixing sleek, new appliances with historic moldings and woodwork.
WASHINGTON -- Average U.S. long-term mortgage rates arrested their five-week decline this week but the benchmark 30-year loan remained below 4 percent. Mortgage company Freddie Mac said Thursday the nationwide average for a 30-year mortgage rose to 3.98 percent from 3.92 percent last week. It remained at its lowest level since June 2013. The rate stood at 4.53 percent back in January.
The average for a 15-year mortgage, a popular choice for people who are refinancing, increased to 3.13 percent from 3.08 percent. The sustained decline in long-term rates sparked a boomlet of homeowners looking to refinance mortgages. Homeowners eager for a bargain rate fired off inquiries to lenders. Applications for "re-fi's" jumped 23 percent in the week ended Oct. 17 -- reaching their highest level since November 2013, according to the Mortgage Bankers Association. But refinance applications fell 7 percent in the latest week, ended Oct. 24.
In recent weeks concern over global economic weaknesses brought market turmoil and sent investors seeking safety by pouring money into U.S. Treasurys. Higher demand drives up prices for those government bonds and causes their yields to drop. The yield on the 10-year Treasury note touched new lows. Mortgage rates often follow the yield in the 10-year note.
This week, the 10-year note rose to 2.32 percent Wednesday from 2.22 percent the previous week. The note traded at 2.29 percent Thursday morning.
To calculate average mortgage rates, Freddie Mac surveys lenders across the country between Monday and Wednesday each week. The average doesn't include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1 percent of the loan amount.
The average fee for a 30-year mortgage was unchanged from last week at 0.5 point. The fee for a 15-year mortgage also remained at 0.5 point. The average rate on a five-year adjustable-rate mortgage rose to 2.94 percent from 2.91 percent. The fee was steady at 0.5 point.
For a one-year ARM, the average rate edged up to 2.43 percent from to 2.41 percent. The fee held at 0.4 point.
Now that we are remodeling with energy efficiency in mind, we get asked a lot of questions by friends and neighbors. The most common, besides "how are you living through all that dust?" is "if I want to improve the comfort and efficiency of my home, which should I do first -- replace windows or add insulation to the walls?" The answer in most cases is insulation, but together they really perform.
Whether you are building to net zero or just want to lower your energy bills, windows and insulation are the blocking and tackling of home design -- one is flashy, the other not so much, but together they get
For our Long Beach house with no existing wall insulation and original wood windows from the '50s, the answer was clear.
the job done. If a house is a football team, windows are a noticeable star like a wide receiver.
Their impact on a house is dramatic, flashy and hard to miss. Insulation might be the left guard (see Michael Lewis' The Blind Side). The left guard doesn't get mention in the sports pages, but he protects the quarterback's back from charging defenders.
Reducing the energy load of the home is step 1 in net-zero design; sizing the solar array is the last step. So it's worth spending time on the X's and O's -- evaluating various options to improve the home's defense against unwanted heat gain or loss. Windows and insulation are definitely the key players here.
Which to do first of course depends a great deal on where you live, what your existing windows and walls are, and other factors like solar orientation, tree shading, etc. But for our Long Beach house with no existing wall insulation and original wood windows from the '50s, the answer was clear.
According to our energy models:
Going from nothing to R-13 walls will reduce our heating/cooling load by 33 percent.
Installing new low-e dual-pane windows (U/SHGC=0.30/0.29) will reduce our load by 14 percent.
Doing both is almost additive, generating a combined heating/cooling load savings of 46 percent.
That load reduction means that we reduce the number of solar panels we need on our roof. If the solar panels are the quarterback of the house, a solid defense against unwanted heat gain or loss means the panels can be more impactful and high-step into the end zone. With proper blocking and tackling, even
The stakes are higher than ever for energy efficiency....
a modest solar array has a shot at net-zero. That is real cost savings.
For us, the installation costs were roughly the same on insulation and windows. So performance bang-for-the-buck was best for wall insulation. And our game plan is to vary the type of insulation in each part of the house. Where we are opening walls, we can add traditional fiberglass batts. Where the walls are largely intact, we can drill a few holes and blow in cellulose insulation. Where we have a large attic space, we can super insulate with blow-in cellulose, reaching R-49 performance. Where our attics are narrow, like over the vaulted ceiling, we can use smaller batts and stop at R-19.
Windows come in an almost endless variety of options. In our analysis, springing for even more efficient windows (triple-pane, triple-coated) did not have payback relative to the extra cost. Why? Because our climate is fairly moderate. Move our house to Las Vegas or the Sierras and the high-end windows may have been worth the upgrade. Proper research makes these decisions clear.
So, why don't more remodels add insulation and windows?
Until now, most remodels were an exercise in making a home more livable, more useful and more attractive. But the game is changing. The stakes are higher than ever for energy efficiency, with several factors generating new interest in energy efficiency improvements like:
1. Rising energy costs.
2. Climate change consciousness.
3. Strict new energy codes encouraging the use of more energy efficient materials.
Innovation by product manufacturers.
But change comes slowly to the building industry, for many reasons. Many homeowners still perceive efficiency features as expensive and optional, and maybe even a little boring. No one goes to showrooms to look at fiberglass batts or cellulose, but they make a big difference in performance.
Builders and subcontractors are sometimes reluctant to try new materials and techniques; their profit on every job is at stake, and they need to work with partners and materials that are dependable. As a result, change filters through the industry only as fast as early adopters change and the competition forces the rest of the players to do the same.
And the industry still needs more financing products with reasonable rates, qualifying hurdles and application timelines. But we are optimistic that energy efficiency is about to have its best season yet. As costs decline, education improves and incentives promote change, the team will be unstoppable.
Bruce Willis' new digs give his Idaho getaway a run for its money. The "Die Hard" actor is living free with 22.32 acres on one of the highest points in Bedford, New York.
The actor has dropped $12 million on a shingle-style home and adjoining parcel in Westchester County overlooking the Croton Reservoir. The sale closed in August but has flown under the radar until recently.
The main residence has five bedrooms, six baths, a climate-controlled wine cellar, mature gardens, a swimming pool and heated cabana. Willis also scooped up land not listed on the Multiple Listing Service: eight acres with an antique house and two renovated guest cottages.
In a divorce, it's bad enough that you're losing someone you once loved or may still love. It's even worse when you find out you may lose your house, too. And finding a replacement, much like starting a love life all over, won't be easy. After all, lenders tend to give mortgage loans to people with good credit and a solid stream of income. If you were previously a two-income household, you aren't now, and if you're paying alimony, you have less money than you did.
Whether you're in the midst of a divorce or its aftermath, here are some things you can do to land a mortgage and what you can reasonably expect.
You may want to get your name or your ex's name off the mortgage. But perhaps not; it depends. If you are planning to buy a house, and your ex is living in the home you co-own, then ideally, your ex
It can be difficult for a person paying alimony to buy a house because of the way lenders look at that alimony.
needs to refinance in his or her name. That will decrease your debt and increase your odds of being able to get a new mortgage.
What if your ex can't refinance on her or his own? If you'd like to see your ex and the kids remain in the house, you may want to leave your name on the mortgage and co-own the house for a while with your ex.
"People do that all the time," says Katie Connell, a family law attorney with Boyd Collar Nolen & Tuggle in Atlanta and a governor-appointed member of the Georgia Commission on Child Support. "I'm stereotyping, but often a woman who didn't work full time and doesn't have the income stream or the credit to buy her own house, she and her ex-husband have agreed, with their family transitioning and changing, that it's in their better interest to keep mom and the kids in the house for, say, four or five years or when the kids go into their college freshman year," she says. "The husband is often willing to essentially extend his credit to his ex-wife by letting his name stay on the mortgage."
If you're going that route, Connell says you'll want to work out details about how profits will be split once the house is sold down the road. It may not be an equal split since one ex-spouse will be likely making the mortgage payments and possibly spending money to maintain the home for those extra years.
Connell says that arrangement tends to work better if the ex without the house still has enough income and good credit to buy a new home of his or her own.
Don't buy a home during the divorce proceedings. Even if you're rich beyond belief, and your credit and income stream are solid, it's still a risky move. Connell says one of her clients lost $10,000 in earnest money when he tried to buy a house during his divorce proceedings.
"He had great credit, a very good income, but when the lender found out he was going through a divorce, they said, 'Your alimony and child support payments are question marks,'" Connell says. "By the
Some lenders won't even consider letting a divorced person who receives alimony use that alimony as evidence of income....
way, this client had a different lawyer back then. If I had been representing him, I would have said, 'Don't do it!'"
Connell adds that when the client's ex learned he lost $10,000 in earnest money, the ex's lawyer naturally felt that the ex was entitled to at least half of that money - it was, after all, money that otherwise would have been in the pot of assets to split.
It can be difficult for a person paying alimony to buy a house because of the way lenders look at that alimony. "Alimony is considered a debt," says Susan Pryor, branch manager of Silverton Mortgage Specialists, a direct lender in Atlanta. "If you make $10,000 a month and give $3,000 to your ex-spouse, the lender doesn't look at it like you're making $7,000 a month. They look at it like you have a $3,000 car payment every month."
Where should you live during the divorce proceedings? Assuming you aren't selling the house immediately and you're both looking for a place to rent, there are two common approaches couples take, according to Connell.
Stay in your house with your soon-to-be ex. "We definitely see more people grinning and bearing it and living together longer," Connell says. "We saw a lot of that in this last recession." It's an idea that makes some sense. Living together awhile longer will save you both money. And especially if you have children, maintaining a civil relationship under the same roof may help with your post-divorce relationship.
You could nest. You hear "nesting" used a lot in pregnancy, but Connell says that in the divorce industry, the term refers to renting an apartment near the house and living there while a divorce is worked out. "We see a lot of couples who take turns living there, and the kids stay in the house," Connell says.
Connell adds the latter arrangement may not work for couples who still harbor a lot of anger or suspicion. She recalls an instance where a wife was convinced the husband was unplugging lamps and cable cords throughout the house before he would leave for the week.
"No damage or harm was done, but [the wife felt] it was just to be a pest," Connell says. Meanwhile, the husband said the cords came unplugged from his vacuuming, and that the wife was leaving dirty dishes in the sink.
Whatever you do, Pryor urges divorcing homeowners to not rush their decision of where to live next. "You may be under tremendous stress, and it's an emotional situation. Divorce can shake your planning, and you may not be able to make the right decisions," she says.
Besides, you may not be able to rush, even if you want to. Some lenders won't even consider letting a divorced person who receives alimony use that alimony as evidence of income until there's a six-month history of alimony payments being paid on time, Connell says.
You may be better off without a mortgage. This may be the last thing you want to hear if you want to hang onto your house or buy a new home. But the money math may not add up.
It's a common mistake with divorced homeowners, says Jean Ann Dorrell, a certified estate planner in Sumter County, Florida. Many people, she says, are "trying to hold onto a house because it's where the kids grew up or because you don't want the kids to have to change schools, you don't want to lose friends and you stay too long trying to afford something you never could have or should have."
Pryor agrees. "We see it a lot," she says. "It's especially emotional when children are involved." She adds that spouses who didn't know a divorce was coming tend to be the ones who can't face their new budget.
Pryor recommends professional help for anyone divorced and struggling to keep their home or figure out where to live next.
"I think it's important to do some financial planning, and there are planners who focus on divorce, so you can see what money is coming in and what's going out," Pryor says. "Just because you can barely make that mortgage payment every month doesn't mean you should stay in the house."
Singing legend Pat Boone has just listed his longtime Beverly Hills mansion for $18,499,000. Boone was one of the most successful artists of the 1950s, second only to Elvis Presley, and has had decades of success as a singer, actor, songwriter, author, political activist and more. Despite his active life and many years of success, he stayed rooted in his life in Los Angeles, where he lived in this stately mansion with his family for more than 50 years.
On the market for the first time in approximately 55 years, the home is located on iconic Sunset Boulevard, bordering the "Golden Triangle," a highly-sought-after area for luxury real estate.
On one of the largest lots in Beverly Hills, a sprawling 48,000 square feet, Boone's estate is being marketed as an "ideal development project." Essentially a teardown or a major renovation project, Boone's just-listed estate currently has six bedrooms, seven bathrooms, 7,000 square feet of living space and expansive outdoor areas that include a pool, lawn and gardens.
Gated and hedged for privacy (see the slideshow below), the property would make an amazing home for a star on their way to a storied career like Boone's. The estate is listed with Seth Perry of Nourmand & Associates.
They tried calling it the music room, the den and the library, but no matter what they called it, no one in this family of four was using this room on their home's first floor. After meeting interior designer Becca Galbraith, they were open to anything that would stop the space from being wasted. "My clients knew they liked handsome fabrics, rich textures and dark colors," Galbraith says. "I suggested we do something dark and risky, and they were totally onboard." Comfortable seating, an elegant media center, reading lamps, patterns and layers of textures turned the room into one of the most sought-after spaces in the house.
Room at a Glance Who lives here: A couple and their 2 teenage children Location: Chatham, New Jersey Size: About 95 square feet (9 square meters)
The room is located right off a larger living room-family room. Galbraith began with a favorite Robert Allen fabric for the window treatments. Because her clients were not afraid to go with dark paint, she pulled an indigo hue straight from the fabric to use on the walls. The owners had added extensive millwork throughout the house a few years prior, including wainscoting and other molding. At first they were a little wary of covering everything with the color, but they trusted their designer and let her go for it.
She used Polo Blue by Benjamin Moore on everything, using a high-gloss finish on the millwork and an eggshell finish on the walls for a subtle contrast. The high gloss, accentuated by the lighting, gives the millwork its due.
Next she layered in texture. A striped rug grounds the room in light neutral color. Vintage and global-inspired finds add character. The X-stool was made from a vintage luggage rack. Galbraith was drawn to the bamboo base's color and texture, so she had her upholsterer replace the top with a hide. "An animal print always helps a room," she says.
Another interesting texture turns up on the stools, which can be tucked right in underneath the leather ottoman. "I knew I wanted something woven and kind of "ropey," she says. She found just the right extra seating with these CB2 pieces.
A TV was next on the owners' wish list. To preserve the millwork all the way around the room, the media casework is freestanding. Matching moldings make them look built in and protect the wainscoting behind them.
The TV practically disappears into the inky paint. Galbraith used a special Venetian plaster treatment on the back panels of the unit to add a little pizzazz. She used the same color as the walls and a gray wash. Antique brass library sconces add shine.
"That top shelf was a big gap, and I knew we needed something really cool to fill it," Galbraith says. She found it in the form of a vintage wooden Thai wheel from a sugar factory.
A vintage metal side table provides a convenient spot for drinks and the TV remote. "I wanted to add a little bit of edge to it," Galbraith says. "I didn't want to overkill with the brass, so I chose a bronzy finish for the lamps," she says. The antique brass upholstery nails can also take on a bronze cast.
The ottoman is another repurposed piece; originally it was a table. Galbraith had the top replaced with a leather-like vinyl upholstery. The woven stools are just the right height for being tucked underneath.
Tip: Artwork doesn't have to fit within molding. The piece in the room that packs the biggest design punch is one the homeowners weren't sure about at first. "I brought the art over on approval on install day, and they were asking where in the world it was going to fit," Galbraith says. "Once they saw it, they said it made the room - they absolutely had to have it."
Art: Peter Dunham
Final touches include this bowl with a gorgeous glaze that brings in a touch of aqua.
The new design of this room has made it a favorite spot where the teenagers gather with their friends and their parents curl up with books. "They used to call it the den and now they call it the gem," Galbraith says. "Everyone loves to hang out in here."
Galbraith is currently working on the family's dining room, and they hope to get to the living room next.
NEW YORK -- Applications for U.S. home mortgages fell last week as both purchases and refinancing slipped, an industry group said Wednesday.
The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity, which includes both refinancing and home purchase demand, fell 6.6 percent in the week ended Oct. 24.
The MBA's seasonally adjusted index of refinancing applications fell 7.4 percent, while the gauge of loan requests for home purchases, a leading indicator of home sales, fell 5 percent.
Fixed 30-year mortgage rates averaged 4.13 percent in the week, up 3 basis points from 4.10 percent the week before.
The survey covers more than 75 percent of U.S. retail residential mortgage applications, according to the MBA.
You may remember Audrey Hepburn and George Peppard standing on these front steps. The New York City brownstone featured prominently in "Breakfast at Tiffany's" is on the market for $8 million after a recent 20 percent price cut.
"Any time they had a street scene, the house was featured," said Asher Alcobi of Peter*Ashe Real Estate, the Manhattan home's exclusive broker. "The signature olive green doors are still the same."
The 1961 romantic comedy was filmed in a studio for the interior shots, including the famous party scene with Mickey Rooney's character, Mr. Yunioshi. But 169 E. 71st St. continues to garner interest as the place Miss Holly Golightly made her debut in The Big City.
"The house is on the tourist tour of the Upper East Side," Alcobi said.
The 3,800-square-foot brownstone boasts four bedrooms, five bathrooms, a sweeping staircase and an enclosed greenhouse.
It's split into an upper and lower duplex. Upstairs, two bedroom suites have their own renovated baths. There's also a sunny living room with a wood-burning fireplace, a renovated kitchen and laundry room. Downstairs, a garden apartment with a separate entrance has a front library, powder room and a large bedroom and full bath.
The house was renovated in the mid '80s and again in the late '90s. It was last listed in 2011 before finding a buyer for $5.975 million in April 2012.
Mortgage rates for 30-year fixed mortgages rose this week, with the current rate borrowers were quoted on Zillow Mortgages at 3.85 percent, up from 3.81 percent at this same time last week. The 30-year fixed mortgage rate hovered around 3.90 percent for most of the week, dropping to 3.77 percent Wednesday before rising to the current rate.
"In the absence of major market-moving news last week, mortgage rates remained below 4 percent for the fourth week in a row," said Erin Lantz, vice president of mortgages at Zillow. "This week, even though the Federal Open Market Committee will release its meeting minutes on Wednesday announcing the end of the Fed's stimulus program, this should come as no surprise to markets, so we expect rate stability to continue."
Additionally, the 15-year fixed mortgage rate this morning was 3.00 percent, and for 5/1 ARMs, the rate was 2.81 percent.
Purchase Mortgage Application Activity: Zillow predicts tomorrow's seasonally adjusted Mortgage Bankers Association Weekly Application Index will show purchase loan activity to decrease by 3 percent from the week prior. (To learn more about this Zillow analysis, click here.)
Actor Stephen Collins and his estranged wife, Faye Grant, are trying to sell their two-house compound in Brentwood, Calif. for a combined $5.5 million, the Los Angeles Times reports. Collins, of course, is the "7th Heaven" star who is being investigated by law enforcement in New York and California for alleged sex abuse, which was made public during his recent divorce battle.
The couple's real estate offerings include two houses in the gated Country Club neighborhood of Brentwood. The more expensive of the two, 13000 Brentwood Terrace, is selling for $2.85 million and includes three bedrooms, three baths, and a detached, two-story guesthouse. The other house, 12960 Brentwood Terrace, is listed for $2.7 million and features four bedrooms and three baths.
The properties can be sold separately or together "to create a fantastic compound of over 21,000 flat sq. ft.," says co-listing agent Elyse Arbour's website.
As part of their divorce settlement, Faye Grant reportedly requested that the properties be sold or that Collins maintain them, according to the Hollywood Reporter.
During the proceedings, which have been going on for years, audio of Collins purportedly admitting to molesting underage girls has surfaced. Because the alleged incidents happened several decades ago and would be barred by the statute of limitations, they may not be prosecuted, reports say.
WASHINGTON -- U.S. home prices grew more slowly in August amid modest sales, a trend that could help make homes more affordable in the months ahead.
The Standard & Poor's/Case-Shiller 20-city home price index, released Tuesday, rose 5.6 percent in August from 12 months earlier. That's down from 6.7 percent in July and the smallest gain since November 2012. Home prices were rising at a double-digit pace as recently as March.
The rapid slowdown has been most pronounced in many of the western cities that have seen the biggest price gains in recent years. The annual price gain in Las Vegas braked sharply to just 10.1 percent from 12.8 percent in July. Prices rose 9 percent in San Francisco from a year earlier, down from 10.5 percent.
The smaller price gains, combined with a recent drop in mortgage rates, could spur more sales. Home sales rose in September to their fastest pace this year, but still remain slightly below the pace reached 12 months earlier. The number of homes for sale is rising, which helps keep prices in check.
"We're transitioning away from a period of hot and bothered market activity, characterized by low inventory and rapid price growth, onto a more slow and steady trajectory, which is great news," Zillow chief economist Stan Humphries said. "As appreciation cools and more inventory comes on line, buyers will start to gain a more competitive advantage."
The Case-Shiller 20-city index covers roughly half of U.S. homes. The index measures prices compared with those in January 2000 and creates a three-month moving average. The August figures are the latest available.
Not only is actress Renee Zellweger's face sporting a new look, so, she hopes, will her real estate portfolio. The "Bridget Jones" actress has just listed her East Hampton farmhouse for $4.45 million.
The 2,000-square-foot house (see the slideshow below) was built circa 1900. It has three bedrooms plus a den, three baths, and has been carefully renovated to keep its original charm intact, according to Curbed Hamptons.
The house also features:
almost an acre of land.
qn easy walk to town and beaches.
and a two-car garage plus loft.
Zellweger bought the house on Egypt Lane in 2003 for $2.15 million, says Curbed Hamptons, which thinks that doubling the price in 11 years is "a little high, but can you put a price on movie star charisma?"
Zellweger, who recently set tongues wagging when she showed up at an Elle shindig sporting a face looking quite different from the Kewpie doll kisser audiences love, also is trying to unload her Connecticut property, which she relisted last July for $1.6 million.
The estate in rural Pomfret Center was built circa 1770 and updated in 2004. It features 37 acres overlooking the Quinebaug River, gardens, dry stone walls, seven fireplaces and a bread oven, says the Zillow listing.
The housing crisis hurt Democratic- and Republican-leaning markets similarly, but today blue markets have lower affordability, lower homeownership, and greater income inequality.
As Election Day 2014 approaches, we see sharp differences in local housing markets depending on whether they are blue or red. As the political urgency of the housing crisis fades, longer-term issues like declining affordability, low homeownership, and rising inequality are taking center stage. And these issues play out differently in Democratic- and Republican-leaning metros.
To show this, Trulia categorized the 100 largest metros as red or blue depending on their 2012 presidential vote. In 32 metros-the red markets -- the Republican candidate, Mitt Romney, got more votes than the Democrat, President Obama. These include places like Houston, Cincinnati and Salt Lake City. In 40 light-blue markets, including St. Louis, Austin and Buffalo, Obama beat Romney by less than 20 percentage points. And in 28 dark-blue markets, including Los Angeles, New York and San Francisco, Obama's margin exceeded 20 points.
When we looked at housing trends in these metros, we found that the housing crisis and recovery affected red and blue markets similarly. But today's pressing housing issues are more severe in blue markets.
The Housing Crisis Hit Both Red and Blue America
When the housing bubble of the mid-2000s burst, both red and blue markets felt the pain. The markets with the most severe housing busts included dark-blue metros like Detroit and Oakland as well as red markets like Bakersfield and Cape Coral-Fort Myers, Florida. The peak-to-trough price decline averaged 16 percent in red markets, 26 percent in light-blue markets, and 25 percent in dark-blue markets. But the relationship between price declines and redness or blueness was not statistically significant. (See note.)
Nor does the recent recovery show any clear bias toward red or blue markets. In September 2014, home prices were up 7.0 percent year-over-year in red markets, 6.2 percent in light-blue markets, and 6.3 percent in dark-blue markets. The markets with the largest price increases included red metros like Palm Bay-Melbourne-Titusville, Florida, and Birmingham, Alabama, and dark-blue metros like Miami and Toledo, Ohio. The relationship between year-over-year price increases and 2012 voting patterns is not statistically significant. Another recovery measure, the share of homes in foreclosure, also doesn't show a statistically significant correlation with 2012 voting patterns.
Key Housing Data in the Reddest Metros
2012 Vote Margin: Obama vs. Romney
Price Decline in Housing Bust, Peak-to-Trough
Year-Over-Year Price Change, Sept. 2014
Median Asking Price Per Square Foot, $
Oklahoma City, OK
Fort Worth, TX
Salt Lake City
Colorado Springs, CO
Note: among 100 largest U.S. metros. Reddest metros are those with highest negative margin for Obama vs. Romney in 2012. See blogpost note for data sources. Data for all 100 metros available here.
Key Housing Data in the Bluest Metros
2012 Vote Margin: Obama vs. Romney
Price Decline in Housing Bust, Peak-to-Trough
Year-Over-Year Price Change, Sept. 2014
Median Asking Price Per Square Foot, $
San Jose, CA
Fort Lauderdale, FL
Note: among 100 largest U.S. metros. Bluest metros are those with highest positive margin for Obama vs. Romney in 2012. See blogpost note for data sources. Data for all 100 metros available here.
Affordability Is a Bigger Problem for Blue Markets
Things look fundamentally different when we compare red and blue markets in terms of affordability and related measures. The tables above show that none of the 10 reddest markets had a median asking price per square foot above $130 in Sept. 2014. But nine of the 10 bluest markets did. Looking across all 100 largest metros, the correlation between price-per-square-foot and 2012 vote margin was positive, high (0.63), and statistically significant. In fact, the only expensive red market was Orange County, California, at $363 per square foot. There was a huge drop-off to the next-most-expensive red market -- North Port-Bradenton-Sarasota, Florida -- at $150 per square foot.
When we plot local market home price per-square-foot and the 2012 presidential vote, we see that most of the red metros are clustered in the lower left-hand corner of the figure, where prices were lowest.
Strikingly, housing costs nearly twice as much in dark-blue markets ($227 per square foot) than in red markets ($119).
Sure, households in blue markets tend to have higher incomes. But those higher incomes are not enough to offset higher home prices. Our middle-class affordability measure, which reflects the share of homes for sale within reach of a median-income household, is significantly lower in bluer markets. Furthermore, blue markets have lower homeownership and greater income inequality than red markets. As with affordability, the relationships between homeownership and inequality on one hand and 2012 voting patterns on the other hand are statistically significant.
What does all this mean? The point is not that Democrats cause expensive housing, lower homeownership, or greater inequality. Determining whether and how the political views of voters or their elected officials affect local housing markets is the stuff of scholarly research, not short blogposts. But because blue markets are less affordable, have lower homeownership, and have greater income inequality, political leaders in Democratic-leaning and Republican-leaning metros may push for different policies.
Furthermore, these local differences in home prices mean that some national housing policies favor red markets and others blue markets. For instance, the current system of conforming loan limits benefits red markets more because homes in those markets are likelier to fall within local loan limits. But the mortgage interest deduction benefits blue markets more, thanks to higher home prices and more residents in higher tax brackets. Such differences could make it harder to reform these long-standing policies. In short, the differences between blue and red local housing markets may add to the challenge of reaching agreement on national housing policies.
Note: Metro-level 2012 Presidential election data are aggregated from county-level data in the Atlas of U.S. Presidential Elections. Peak-to-trough price declines are calculated from the Federal Housing Finance Agency House Price Index. Year-over-year price changes and median asking prices per square foot are from the Trulia Price Monitor. Correlations mentioned in this post are metro-level, weighted by number of households in the metro, and statistically significant if p<.05. The correlation of price per square foot and vote margin is calculated using the natural log of price per square foot.
Jed Kolko leads Trulia's housing research and provides insight on market trends and public policy to major media outlets including TIME magazine, CNN, and numerous others. Jed's background includes a Ph.D. in Economics from Harvard University and more than 15 years of publications and research management in economic development, land use and housing policy, and consumer technology adoption.
Sitting high on a hill overlooking Hollywood Boulevard in Los Angeles, this once-glorious house had been chopped up into rooms that had been rented to actors. Strange exterior doors from bedrooms and neglected spaces abounded. Seeking to bring the historic 1939 home back to its former glory, an adventurous young couple bought it and made plans for an extensive restoration. Rather than going for a strict historic restoration that wouldn't function well for their modern family, they sought to give it an essence that respected the original architecture and era. Using striking colors and materials that will patinate and gain character with age, principal designer Jeff Troyer helped them create a kitchen that matches the home's original glamour while functioning well for a growing modern family.
Kitchen at a Glance Who lives here: A couple with a 1-year-old. Location: Los Angeles. Size: 232 square feet (21½ square meters). Team: Design: JWT Associates; construction: Duane LaDage, Trueline.
BEFORE: During the era in which the home was built, kitchens were simple utilitarian spaces and not the important hubs they are today. An oddly placed peninsula (right) originally separated the breakfast room from the rest of the kitchen. A lack of windows and upper cabinets gave the room a chopped-up feeling and made it dark.
AFTER: Troyer removed the peninsula to combine the small kitchen and breakfast room into one large, open space. Now the entire room benefits from both windows, and the room is flooded with light. White tile helps keep it as bright as possible. The original windows were saved, offering views of Hollywood Boulevard and a tie to the past.
"These clients were really fun to work with -- they were well traveled, sophisticated and had a great art collection but were also quirky in a good way," the designer says. A few small details worth noting are the Carrara marble on the shelf beneath the bay window and the open cabinet shelves to the left, used for cookbooks. The owners are wine lovers, and the large glass-front refrigerator stores their collection.
"It was very important to keep this wall light; if you look at the situation before, you'll see why," Troyer says. Thus, he eschewed upper cabinets and made up the difference with extensive storage across the room.
Cabinet paint: Stiffkey Blue, Farrow & Ball; refrigerator, wine refrigerator, dishwasher: Miele; pendant lights: Satellite 3 with natural brass finish, Schoolhouse Electric;sinks: Julian; faucets: unlacquered brass, Newport Brass; reclaimed wood on island and on shelves: Croft House; range: Wolfe
Extensive storage on the opposite wall allowed for the open window wall. The space to the left serves as a pantry; the space to the right stores china and glass. The glass cabinet fronts and the proportions give the piece more the feel of a china cabinet-vintage butler's pantry than of typical modern cabinets, appropriate to the home's history.
The new island top is a mix of reclaimed pine and oak wood with a wax finish. "My clients loved the idea of bowling alley-like wood strips, so we used two different types of wood in thin strips," Troyer says.
A lucky budget saver: One of the homeowner's fathers is a contractor, and he just happened to have scads of beautiful handmade white 4- by 4-inch tile he wasn't using. "It has lots of character to it," Troyer says. He took full advantage, using it throughout the house (he also renovated bathrooms during a different renovation phase). He staggered the squares here, creating a fresh take that mashes up square tiles with a subway tile pattern. Saving on this item meant the owners could splurge on custom-painted ceramic tiles from Ann Sacks over the range.
One of the "living" finishes the couple opted for is brass, which is seen on the hardware, lights and faucets. It starts off looking shiny, but will age and patinate over time.
AFTER: Obviously, the brilliant blue paint is a major design element. When Troyer presented several material palettes to the couple during the first part of the design phase, they immediately fell in love with this daring hue.
The floor is antique cement tile from a monastery in France, acquired via Exquisite Surfaces. "After we installed this, we all agreed that the kitchen had soul," Troyer says. To go along with the floors, the couple chose a material that could quickly match the tiles' aged look: Carrara marble. "It will take on a life of its own as it stains and chips," he says.
Tip: Carrara marble is not for everyone; before investing, test it out to see if it's for you. When clients think they might want it, Troyer gives them a big piece to take home, lay atop their counter and abuse for awhile. If they see its imperfections as the marble's getting better with age, it's for them. If they freak out about stains and dings and want to keep it looking exactly as it did on installation day, it's not.
Vintage-looking wood shelves and iron corbels contrast with the elegant Carrara marble and serve as a bar area next to the wine refrigerator.
Actress Tia Carrere, best known for her roles in "Wayne's World" and "True Lies," has listed her remodeled Topanga Canyon retreat for $2.595 million. Its mountaintop location comes with panoramic views to Santa Catalina Island and beyond.
Carrere purchased the home in 2005 for $1.625 million and has added modern, luxurious conveniences. Hardwood floors, high ceilings, clean lines and spacious modern bathrooms are just a few of the 1980-built home's new features.
The 3,567-square-foot home has four bedroom suites -- two of which are considered master suites - and five bathrooms. The main master bathroom features a steam shower and whirlpool bathtub.
The open floor plan is perfect for entertaining or family living. A chef's kitchen with Fisher & Paykel appliances and an eat-in bar opens into a spacious living room. The kitchen and living room areas lead to expansive patios and outdoor living/entertaining spaces. The indoor and outdoor entertaining spaces are also furnished with surround sound.
Any outdoor and fitness enthusiast will find the grounds exceptional -- the property is complete with a saltwater lap pool, recently resurfaced tennis court and plenty of hiking trails on the nearly 3-acre property. There's also an indoor gym, and, for the kids, a gated AstroTurf playground.
WASHINGTON -- The number of Americans signing contracts to buy homes ticked up slightly in September, as it remained difficult to qualify for mortgage financing.
The National Association of Realtors says its seasonally adjusted pending home sales index rose 0.3 percent over the past month to 105. The index remains half a percentage point below its 2013 average, although 1 percent higher than a year ago.
Tight credit and price increases through the middle of 2013 have limited buying activity. About 15 percent of the real estate agents surveyed for the index say they couldn't close a deal because the buyer was unable to obtain a mortgage.
Pending sales are a barometer of future purchases. A one- to two-month lag usually exists between a contract and a completed sale.
The markets that led the country through the real estate recovery with rapid home value appreciation are cooling off, new Zillow data shows. Zillow's Real Estate Market Reports for the third quarter reveal a softening real estate landscape. Buyers in San Francisco, Los Angeles, Washington, D.C., Seattle and other hot markets have a better chance to buy a home now than they did a year ago. More inventory is
"We always knew these market conditions couldn't last."
on the market, more sellers are cutting their list prices and home values, while still on the rise, are rising more slowly.
Nationally, 18.6 percent more homes were on the market than a year ago. Annual home value appreciation peaked in April at 8 percent and has been gradually falling ever since. Between September 2013 and September 2014, national home values rose 6.5 percent to a median of $176,500.
The gradual slowdown is a sign that the market is returning to normal, said Zillow Chief Economist Stan Humphries, and it offers further evidence that there is no housing bubble. "We always knew these market conditions couldn't last, and it's good to see us now on a more natural and sustained glide path down toward more normal market conditions," Humphries said.
To dive into our recently released Q3 Real Estate Market Reports, visit Zillow Research.