HYDE REPORT 2024

June 2024 Vol. 6

The Hyde Report features up to the minute real estate news & trends along with articles designed to help improve your real estate IQ. 

This month my feature video is: What’s the difference between pre-qualification and pre-approval?

 These segments are designed to inform and to enrich your homeowner experience.

My highlight article for this edition is: “The Transformation of Empty Offices”. Gain insights into the future of real estate and make informed decisions for your investment journey. 

The theme for my monthly greeting is “Embracing The Energy Of June”.

Additionally, I have included a list of this months observances & a short motivational section. I love to start each day with a positive thought and I would like to share my favorites with you. My vision is to ensure you’re not just informed but also engaged in the vibrant tapestry of real estate & community.

As always thank you for joining me on this journey. I look forward to embarking on this month’s exploration of real estate together!

Embracing the Energy of June

Real Estate News

Golden Years Interrupted: Inflation Forces Retirees Back to the Workforce

A growing number of retirees are returning to work due to financial instability caused by inflation. Many seniors are now grappling with the dual challenge of balancing family responsibilities and economic needs as their retirement budgets are strained by rising costs.

The rising cost of living is pushing retirees to re-enter the workforce, either full-time or part-time, as they find their retirement income insufficient to meet their needs. This financial strain is largely due to significant increases in living expenses, such as car insurance and gasoline prices.

 

Inflation has driven up the Consumer Price Index by 3.4% recently, with overall prices 19.4% higher since early 2021. Grocery prices have surged by over 21%, shelter costs have risen by 18.37%, and energy prices have soared by 38.4%. A Federal Reserve report indicated that 65% of U.S. adults feel worse off financially due to inflation, with 19% describing their situation as significantly worse.

Inflation affects not only daily expenses but also home maintenance costs, with the prices of essential services like plumbing and electrical work doubling. Consequently, many retirees are seeking employment once again to achieve financial stability in the face of these rising prices.

Source: Fox News

Los Angeles Sewer Bills Set to Double by 2028 to Fund Infrastructure Upgrades

Los Angeles residents and business owners may see their sewer bills more than double over the next four years due to proposed rate increases by the city’s sanitation bureau. The plan involves seven rate hikes between October 2024 and July 2028, starting with a 22% increase, followed by smaller increments. Currently, an average household pays $75.40 bi-monthly, which will rise to $155.48 by July 2028. Low-income households will continue to receive discounts.

Council member Katy Yaroslavsky noted that rate hikes were paused during the COVID-19 pandemic, but now substantial increases are necessary to update the city’s aging sewer infrastructure and meet bond obligations. After a contentious debate, the City Council voted 11-4 to proceed with the rate increase process, pending a final vote.

Katy Yaroslavsky 2023
Council Member Katy Yaroslavsky

Before finalizing, the city will notify property owners and hold a public hearing. If over 50% of property owners formally object, the hikes cannot proceed. The sanitation bureau will provide tools and forums for residents to understand and discuss the proposed changes.

The last rate increase occurred in 2012, with the final adjustment in 2020. The proposed hikes aim to address aging infrastructure, such as 90-year-old pipes and outdated treatment plants, requiring over $3 billion in capital projects over the next five years. Some, like budget advocate Jack Humphreville, argue for a smaller, one-time increase and a thorough review of the sanitation bureau’s operations.

Proposed sewer rate increases

Council member Monica Rodriguez suggested an independent evaluation of the proposed increases, but there are legal and timing concerns. Ultimately, the council authorized the city attorney to draft an ordinance and the sanitation bureau to notify ratepayers and prepare for a public hearing.

Source: Daily News

New home sales fall as interest rates rise and existing housing supply increases

Sales of newly constructed homes in the U.S. dropped in April by 4.7% month-over-month and 7.7% year-over-year, according to the U.S. Census Bureau and the Department of Housing and Urban Development. The decline in new home sales from April of last year was the first yearly decrease in 13 months and the dip was the largest since March 2023. The pullback in new home sales, which was based on signed contracts, was due primarily to the surge in mortgage rates and the increase in inventory in the resale market. With interest rates off from their recent peaks and builders stepping up their use of incentives in the past few weeks, sales in the new home market should see a bounce back in May. On the supply side, the number of for-sale properties continued to increase with new home inventory rising to 480,000 units in April, the highest level since early 2008. The median sales price for new homes, meanwhile, dipped 1.4% from March but climbed 3.9% from a year ago to $433,500.

SOURCE: California Association Of Realtors

New Home Sales Down

What’s the difference between pre-qualification and pre-approval?

Both pre-qualification and pre-approval help you see what your mortgage could look like and estimate how much house you can afford, but they have some important differences.

The Transformation of Empty Offices

One of the lasting impacts of the COVID-19 pandemic is that over 25% of households have at least one person working remotely. This leaves a lot of vacancies in office buildings that were previously bustling with in-person workers. While many of these offices have remained empty for months, some have been developed for alternative use. Here’s a closer look at what’s happening to empty office spaces.

 

Affordable Housing

Many, especially those living in urban areas, have felt the squeeze of affordable housing. To alleviate rising home prices and offer more affordable housing, the government has launched an initiative to transform empty office spaces into affordable housing. This effort is focused on creating housing near transportation hubs, which includes subway stations and bus terminals. Not only will this effort result in more affordable housing, but it is expected to revitalize metropolitan areas that have emptied over the last 3 years.

Affordable Housing

Residential Spaces

Housing inventory remains low, but demand remains high, so some building owners are seizing this opportunity to convert their empty offices into residential spaces. While there are challenges that come with converting office buildings into multifamily residential properties – plumbing, windows, and HVAC for each unit – property owners can benefit from not having to build from scratch.

Transforming Office Spaces

 Coworking Spaces

Property owners are also converting vacant offices into coworking spaces. Coworking spaces are attractive to work-from-home-ers who are looking for a change of scenery or collaboration one or two days per week. Additionally, small businesses and sole proprietorships are moving to coworking spaces to avoid the high overheads that occur when leasing a centralized office. A bonus for building owners is that coworking offices are rented out on a short-term basis and can generate higher revenue than traditional offices. However, managing a coworking space and keeping it at capacity (and profitable) can be a challenge. 

 

Trending: Vertical Farms

Although less common than affordable housing and coworking spaces, empty offices are also being converted into vertical farms. During the 21st century, vertical farming has become increasingly common in urban areas where open land is scarce. Vertical farming avoids the challenges that occur in traditional farming, such as irregular precipitation and damaging weather. By growing crops indoors and focusing on those that can thrive in this artificial environment, it’s possible to mitigate the risks and unpredictability associated with growing crops outside.

With so many offices still lying vacant, there’s a good chance that more alternative uses for these properties will be discovered in the coming years.

Vertical Farming

Motivational Moment

"Beyond First Impressions: The Path from Short-Term Success to Long-Term Achievement"

In our competitive work environments, it’s easy to get caught up in short-term successes and flashes of brilliance. These appearances of success can offer major hope and suggest that long-term sustainability is within reach. Great progress leads to optimism and a belief that we’re on the right path.

However, there is a crucial difference between these appearances and actual arrivals. Arrivals signify sustained achievement over an extended period, where repeated winning behaviors have become the norm. They reflect a deep understanding of what works and what doesn’t, representing a true climb to the top of the mountain.

Understanding this distinction is essential. The best in any industry know that what was good enough yesterday often isn’t good enough tomorrow. They never take for granted the continuous effort required for elite performance.

As Oklahoma Thunder’s General Manager Sam Presti wisely notes, “We can crack the code or we can pick the lock. We need to crack the code.”

In essence, while appearances can provide hope and indicate potential, arrivals represent the culmination of sustained effort and real, lasting achievement. Recognizing and striving for this long-term success is key to truly excelling in any field.

SOURCE: The Daily Coach

I wish to extend my sincerest gratitude to each and every one of you for taking the time to explore the June 2024 Hyde Report!

Your support and engagement mean the world to me. 

Remember, whether you’re a seasoned investor or a first-time homebuyer, your real estate aspirations are within reach.

And finally I would like to leave you with my inspirational quote of the month,

“A person who will not inconvenience themselves for their friends, has none” – Unknown Author

May your ventures be prosperous, your homes be filled with joy, and your dreams be ever within reach.

Warm regards, 🌟
Lamont Hyde

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I met Mr Hyde in 2017 while searching for someone to help my sister in law who was in a financially challenging position
I was referred to Lamont Hyde from a neighbor of mine who had used him to purchase her home a few years back. My mother had past away a few months
My wife & I never thought we could afford to own our home. We were currently living with my mother since being married 8 years ago.
Lamont Hyde Broker / Owner of THG Realty & Loans

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