Don’t be too thankful for the recovery

Posted in Economics, Housing Recovery, National Real Estate | 1 Comment

From the WSJ:

Real Home Prices Could Take 17 Years to Return to Peak

Home prices have been growing at a rate that some see as alarming—about twice the rate of wages. But adjusting for inflation, the market still has a long way to go before returning to the frothy state of a decade ago.

Most measures of home prices—including the S&P/Case-Shiller Home Price Index, the CoreLogic Home Price Index and the National Association of Realtors existing home sales report—don’t take inflation into account and show prices nearing or surpassing the peak hit in 2006 or early 2007.

But a new analysis by real-estate information firm CoreLogic finds that when adjusted for inflation, home prices are years away from hitting the lofty heights of the housing boom. Indeed, economists there say that prices are unlikely to surpass 2006 levels until 2023 or beyond, some 17 years past the peak.

“It’s a slow recovery in housing,” said Sam Khater, deputy chief economist at CoreLogic. The rise and fall in prices without adjusting for inflation matter for existing homeowners because they determine whether or not they are underwater on their mortgages. The rapid run-up in prices in recent years has made it easier for people to sell their homes because they no longer owe more on their mortgage than the home is worth.

As of September 2015, CoreLogic’s Home Price index was 7% below its April 2006 peak, not adjusted for inflation. Prices fell 32% from that peak to the trough in March 2011.

But adjusted for inflation, the bust looks far worse. In September 2015, CoreLogic’s Home Price Index was still 20% below the peak in March 2006. It dropped 41% from that peak to the trough in February 2012.

State ready to force reassessment of properties

Posted in New Jersey Real Estate, Politics, Property Taxes | 124 Comments

From the Star Ledger:

State blasts tax boards, may force N.J. towns to reassess properties

Three New Jersey municipalities in Union, Hudson and Middlesex counties are under investigation by the state for stalling property reassessments for decades and could be forced to conduct revaluations.

The investigation of Jersey City, Elizabeth and Dunellen is a shot across the bow to municipalities in the three counties the state says have neglected their legal duty to ensure fair property assessments, key in determining the real estate taxes home and business owners owe.

Tax boards in these three counties have “consistently failed to require towns to uniformly and fairly assess properties,” Treasury Department officials said Wednesday.

Over time, properties’ assessed values grow increasingly out of line with their market values, and some owners wind up paying too much, while others pay too little. Jersey City hasn’t reassessed in 27 years, Elizabeth in 39 years and Dunellen in 33 years, according to the state.

“The Division of Taxation is reluctantly taking this action because the Hudson, Middlesex and Union county tax boards have failed to do what they are supposed to do,” Treasury spokesman Joe Perone said. “The state has been more than patient in trying to convince the county tax boards to meet obligations, but they have been lax in enforcement because revaluations are unpopular.”

In a news release, the state also calls out Westfield, South River, East Newark, Harrison, Roselle and Winfield. They are among 32 municipalities that have not reassessed in at least 25 years, Perone said.

This would be the first time in four decades that the division is invoking its authority to force a municipality to reassess its property “because it’s clear that the county tax boards and the three municipalities have no interest in complying with the law,” he said.

“Over the nearly three decades since Jersey City’s last revaluation in 1988, the New Jersey Gold Coast city has seen a substantial redevelopment and increased demand,” he said in a statement. “Despite a booming real estate market that has enriched homeowners, many Jersey City residents continue to pay taxes as if they couldn’t give their homes away. Even worse, the rest of New Jersey has been forced to pick up the tab while city officials have resisted efforts to be held accountable for their own spending.”

According to the state Department of Treasury, the true value of Jersey City properties is $15.6 billion higher than its assessed value. In Dunellen, the market value of property exceeds the assessed value by a factor of four.

Prices, inventory weigh on home sales, but still up year over year

Posted in Economics, Housing Recovery, National Real Estate | 91 Comments

From Bloomberg:

Sales of Existing U.S. Homes Fall From Second-Highest Since 2007

Sales of previously owned U.S. homes retreated in October from the second-highest level since 2007 as lean inventory limited momentum in residential real estate.

Closings, which usually take place a month or two after a contract is signed, dropped 3.4 percent to a 5.36 million annual rate, the National Association of Realtors reported Monday. Prices increased compared with October 2014 as the number of dwellings on the market decreased.

A limited supply of available properties, particularly more affordable homes, has made for a slow and steady recovery in residential real estate. At the same time, steady employment growth, rising rents and low borrowing costs are bolstering prospects for the market.

“Unless supply catches up, there will still be problems on the price side,” said Xiao Cui, an economist at Credit Suisse in New York. “We think that job growth and earnings growth have been promising this year and should help affordability.”

The median forecast of 71 economists surveyed by Bloomberg called for sales at a 5.4 million annual rate. Estimates ranged from 5.09 million to 5.6 million. September’s pace was unrevised at 5.55 million, the second-fastest rate since February 2007.
Compared with a year earlier, purchases increased 0.9 percent in October before adjusting for seasonal variations.

The median price of an existing home rose 5.8 percent from October 2014 to $219,600. The appreciation was led by an 8 percent year-to-year advance in the West.

Prices have been bolstered by a dearth of supply on the market. The number of previously owned homes for sale dropped 2.3 percent in October from a month earlier to 2.14 million, the fewest since March.

Purchases declined in three of four regions, led by an 8.7 percent drop in the West, the Realtors’ data show. They were unchanged in the Northeast.

Fewer underwater than they think?

Posted in Demographics, Economics, Employment, Housing Recovery, National Real Estate | 43 Comments

From the WSJ:

Why the Housing Rebound Hasn’t Lifted the U.S. Economy Much

American homeowners are finally digging out of the hole created by the housing crisis. But their housing wealth is playing a much smaller role in the overall economy than it did before the downturn.

Home equity has roughly doubled to $12.1 trillion since house prices hit bottom in 2011, according to the Federal Reserve. As a result, a key gauge of housing wealth—homeowners’ equity as a share of real-estate values—is nearing the point seen a decade ago, before the downturn.

Such a level once would have offered a double-barreled boost to the economy by providing owners with more money to tap and making them feel more flush and likely to spend. But today, that newfound wealth has had little effect on behavior. While the traditional ways Americans tap their home equity—home-equity loans, lines of credit and cash-out refinances—are higher than last year, they are still depressed.

Home equity’s effect on consumer spending is at its lowest ebb since the early 1990s, according to Moody’s Analytics. The research firm estimates that every $1 rise in home equity in the fourth quarter of 2014 would translate to about two cents of extra consumer spending over the next 1 to 1½ years. That was a third of the impact home equity had before the bust, Moody’s said.

The impact is more muted now despite the fact that home equity per homeowner has roughly doubled. At the end of the second quarter, the figure was about $156,700, up from $81,100 in the second quarter of 2011, according to Moody’s Analytics chief economist Mark Zandi. Though the homeownership rate has fallen, the total number of households has increased, meaning the number of households that own hasn’t changed much since the housing bubble burst in 2006, Mr. Zandi said.

Why aren’t homeowners feeling flush again? For one thing, since rising home prices over the past few years largely have made up for ground lost during the recession, many owners might not even realize they have equity to tap.

The percentage of homeowners who were underwater, or owing more on their mortgage than the home’s value, dropped to 8.7% by mid-2015 from 21% at the end of 2011, according to CoreLogic. Yet the percentage of homeowners who thought they were underwater fell by merely one percentage point to 27%, according to housing-finance company Fannie Mae.

“Consumers are definitely more conservative financially than they were 10 years ago. They’ve seen that house prices can be volatile,” Mr. Duncan said.

“We’re at an inflection point,” Mr. Zandi said. “Since the crash, it’s all been about repairing homeowners’ equity but now that house prices are returning to prerecession levels, we will see homeowners’ equity driving consumer spending, home improvements and economic activity.”

Vindication … again!

Posted in Housing Bubble, New Jersey Real Estate | 34 Comments

Anyone who has been here since the beginning will remember Dominick Prevete, who we regularly sparred with in 2005. Well, it seems that the leading real estate bubble cheerleader has gotten himself into some trouble. But, before we get into that, let’s take a look back and review the history. For those who weren’t around in 2005, take some time to read these, you’ll enjoy them:

October 23rd, 2005: Debunking Another Real Estate Puff Piece

Dear Mr. Prevete,

You, sir, are a moron.

You have optimism over these new “Loan Products”? The new loan products that has the banking industry and the fed shaking in their boots? These new loan products that let underqualified buyers overleverage themselves to purchase overpriced homes that risk significant depreciation? You’re optimistic?

“The only risk is that the underlying asset loses value — and I don’t expect home prices to quickly depreciate,” he said.

Mr. Prevete, would you and your organization (Weichert Realtors) care to sign a contract that holds yourselves responsible for any depreciation or loss on any sales you broker? If prices don’t go down, you’ve got nothing to lose right? Or is this statement just doubletalk? That you do indeed expect home prices to depreciate, just not quickly.

November 16, 2005: N.J. home sale fever breaking, data show

“I believe the NAR numbers don’t reflect the last 45 to 60 days in the market,” said Dominick Prevete, regional vice president for northern New Jersey at Morris Plains-based Weichert Realtors. “In the short term, buyers have been on hold by some recent developments, like the Hurricane Katrina and the quick run-up in energy prices. Those things had people scared and a bit frozen.”

It’s our old friend Dominick Prevete again. You might remember him from “Debunking Another Real Estate Puff Piece”, a few weeks ago, I think I may have called him a skirt wearing, pom-pom shaking cheerleader for saying the market was a “win-win for buyers and sellers” and recommending risky loans. It seems he’s changed his tune a bit, so I wonder if he read my article (I did see alot of hits from Google showing that folks hit my site searching for his name).

Again, however, I must call you a moron Mr. Prevete. What impact would the hurricanes have on buyers in New Jersey? In case you missed it, they didn’t exactly hit here. Or are you just looking for something to blame, calling it only a short term downturn once we get over the pain of the hurricanes? And run up in energy prices? If the recent uptick in energy prices made it hard on someone to purchase a home, I really don’t think those people should be buying a home in the first place. These prospective buyers must be pretty strapped for cash if you are blaming an increase in gasoline prices on the decrease in sales. No Mr. Prevete, the reason people aren’t buying is because more and more people realize that real estate isn’t a “win-win” investment, and you can lose alot of your hard earned money. Buyers know we are in a bubble, and they are smart enough not to buy.

December 24th, 2005: To Warren Boroson and Dominick Prevete

Many of my readers will be familiar with the name Warren Boroson, a local journalist. Warren has written some real gems in the past year, many of which try to entirely discount the fact that there is a speculative bubble in residential real estate. Warren has defended his position so vehemently, one wonders what vested interests he has in it. Warren is at it once again, with his pal Dominick Prevete (regional vp of Weichert) who like clockwork appears in every one of Warrens articles to offer up expert opinion. Warren, why do you continually quote Mr. Prevete in every real estate article you write?

Perhaps I’m being too critical of the duo, the most recent piece at least concedes some possibility there is a bubble, however, the article ends with the usual pro-real estate spin..

So here goes, how the mighty cheerleader has fallen from grace. From the NJ Herald:

Former Weichert executive accused of embezzlement

A 46-year-old former top executive of Weichert Realtors who oversaw the company’s offices in Sussex County and elsewhere throughout the region has been accused in a newly filed company lawsuit of embezzling funds intended for marketing purposes and redirecting them for his own personal use.

Dominick Prevete, who rose from managing the company’s Sparta office to become regional vice president in charge of 23 Weichert offices throughout northern New Jersey, is alleged by the company to have defrauded Weichert and its salespersons by way of multiple acts of theft and forgery.

Prevete, a former Fredon resident who currently resides in Morristown, was fired by the company on Oct. 22 and has since been named by the Morris Plains company in an 11-page civil lawsuit that seeks unspecified compensatory and punitive damages for fraud, breach of fiduciary duty, and civil theft.

Prevete, reached by phone over the weekend, said “it’s (Weichert) a great company and I’m sure we’ll work it out,” but declined further comment.

But an internal company memorandum obtained by the New Jersey Herald, in which employees were directed not to talk to the media but were encouraged to share the information with others, indicates Prevete “stole company monies intended for Weichert Sales Associates and he has confessed to his misdeed.”

The memorandum goes on to state that the matter has been referred to criminal authorities and to the New Jersey Real Estate Commission, which could act to revoke Prevete’s real estate broker’s license.

In its lawsuit, filed in Superior Court in Morris County, the company details an elaborate scheme allegedly devised by Prevete to steal unused funds allocated to the company’s sales representatives for reimbursement of their marketing costs and have them redeposited into his personal bank account.

The lawsuit states that as regional vice president, “Prevete had access to information including which salespersons did not have direct deposit and which salespersons typically did not utilize some or all of their marketing funds” and that he used this information “to defraud Weichert and its salespersons and to benefit himself.”

The lawsuit indicates that Prevete — who, as regional vice president, had the authority to obtain marketing funds for salespersons under his jurisdiction — “abused his access to company information by researching and targeting salespersons who did not have direct deposit of funds so that he could obtain physical checks in a scheme to steal from Weichert and so that such thefts would not be detected.”

Prevete allegedly would then would fill out a form indicating a salesperson was to be paid a marketing allowance, would present the form to Weichert’s commission department for approval, and would then request a check payable to that salesperson.

Upon receiving the check, “Prevete then forged the signature of the salesperson on the check. After forging the salesperson’s signature, Prevete would then endorse the check for deposit into his own personal account.”

“Prevete would then tender the check to his own bank and fraudulently represent that the check had been properly endorsed over to him.”

The lawsuit goes on to detail three specific instances, right down to the check numbers themselves, in which Prevete allegedly forged and cashed checks in the manner described.

In each of the cases, the lawsuit states, “Prevete intentionally stole funds from Weichert by abusing his position to target the salesperson, by misrepresenting that funds were owed to the salesperson, by filling in a (request) form with fraudulent information, by forging the salesperson’s signature on the check and by depositing the funds into his bank account for his own personal gain.”

Hat tip to Wag for letting me know, and Eric Obernauer at the Herald for pulling this piece together. Took ten years to prove what we all knew on day one.

If high taxes mean no jobs, why has NY recovered?

Posted in Housing Recovery, Politics, Property Taxes | 97 Comments

From the Star Ledger:

N.J. has worst business tax climate in U.S., study finds

New Jersey’s high property and income taxes contribute to its standing as the nation’s least attractive tax climate for businesses, according to a Washington tax policy group’s annual ranking of the 50 states.

The Tax Foundation, a public policy group that has two former Republican lawmakers on its board of directors, considered five metrics, including corporate, individual income, sales, unemployment and property taxes to arrive at an overall rank. New Jersey ranks dead last — a distinction the Garden State has had since at least 2013.

“New Jersey… is hampered by some of the highest property tax burdens in the country, is one of the two states to levy both an inheritance tax and estate tax, and maintains some of the worst-structured individual incomes in the country,” according to the study.

With average homeowner property tax bills exceeding $8,000, New Jersey ranks 50 of 50 on property taxes. New Jersey doesn’t fare much better in a comparison of individual income and sales taxes, registering at 48 and 47, respectively.

It climbs a few spots up to 43 in the ranking of corporate business taxes. But the state’s best showing , 31st, is on the unemployment insurance tax.

The left-leaning Trenton think tank, NJ Police Perspective, said in a statement that “business tax climate” shouldn’t be confused with “business climate,” noting that New York ranked one slot higher than New Jersey but has “recovered from the recession with gusto.”

NJ Tax Machine Rolls On

Posted in New Jersey Real Estate, Politics, Property Taxes | 138 Comments

From the APP:

Property tax relief? Not in sight in NJ (Warning annoying autoplay video)

Tax relief doesn’t appear to be on the way anytime soon for New Jersey residents — in fact, top state lawmakers meeting here Wednesday spent much of the time talking about how to raise revenue.

During a panel discussion, the officials agreed that the New Jersey’s highest-in-the-nation property tax is a concern, but they focused much of the discussion at potentially raising a different tax.

Democrats on the panel said replenishing the state’s transportation trust fund is the top issue facing the Legislature and that hiking the gasoline tax is an option to address it.

“All we’re talking about is raising taxes. But first why don’t we talk about some tax that we can lower?’’ said Republican Assembly leader Jon Bramnick.

Democrats increased their advantage in the 80-seat Assembly in elections earlier this month. Outrage over New Jersey’s $8,200-average property taxes prompted nearly 14,000 people to sign an Asbury Park Press petition in the weeks leading to the vote demanding that top elected officials commit to a plan for a 10 percent property tax cut by year’s end.

Many who signed the petition included handwritten notes complaining of their inability to keep up with the staggering tax burden in the Garden State.

Many lawmakers — mostly Republicans — also signed a pledge to cut the property tax, after a Press investigation showed how property taxes increase by some $540 million annually, even with a 2 percent tax cap in place.

“Too many of our relatives are being taxed out of the state,’’ Kean said. “Too many of our friends and neighbors are moving out of the state and we need to have as our primary focus, hopefully in lame duck but also in the upcoming session (beginning in Janurary), understanding what is making the state so unaffordable.’’

Bramnick said he’d rather focus on having the state’s school-funding formula retooled “to something that’s more fair, because (much of the school funding budget of) $9 billion of our $34 billion budget goes to a limited number of school districts, and much of that money has not created success.”

“It’s time to take it away from the courts and do a constitutional amendment and make it more fair. That’s how you reduce property taxes in many of our towns and cities,’’ he said.

Hardly making progress…

Posted in Employment, New Jersey Real Estate | 43 Comments

From the Record:

Foreclosure crisis easing in NJ, but state still leads the nation in housing distress

New Jersey continues to lead the nation in mortgage distress and foreclosure activity, the Mortgage Bankers Association said Tuesday.

One in eight – about 12.7 percent – of mortgage holders in the Garden State were either late on their monthly payments or in the foreclosure process during the third quarter, the MBA said. But that number is down from 15 percent in the same period last year, as lenders continue to chip away at a backlog of distressed properties that built up in the foreclosure pipeline after the housing crash.

“There is some chance that we are finally turning the corner on this,” said Charles Steindel, an economist at Ramapo College and former chief economist for Governor Christie.

Nationally, the level of housing distress in the third quarter was at its lowest level since 2007, before the 2007-2009 recession. Nationwide, 7 percent of mortgages were either in foreclosure or at least one payment past due.

New Jersey has lagged the nation in solving the foreclosure crisis because it is among about two dozen states where foreclosures go through the courts, which tends to slow the process. In addition, the state is still catching up after a near-freeze on foreclosure activity several years ago, as the mortgage industry dealt with accusations that it was abusing homeowners’ rights.

Zillow liberates data, dirty Realtors fight back

Posted in Humor, Unrest | 114 Comments

From HousingWire:

Here is the latest attack aimed at Zillow’s latest attack at Zillow Group (ZG) took it to the streets, removing a house from the residential block by wrapping it in what they say is a real-life analogy of homes that Zillow users are missing out on.

The online real estate listing service wrapped a home that is currently on the market in Austin, Texas and brokered by GoodLife Realty.

The words “Searching for a home to buy on Zillow? You’re missing out on thousands like this” are inscribed on the wrapping, which will stay up until Nov. 14.

This is a part of’s recent campaign against Zillow, with this particular advertisement trying to shows how lists many more MLS-listed, for-sale homes than its main competitor.

In light of the campaign, conducted an internal analysis in October, which said provides at least 20% more – or an estimated 300,000 more – MLS-listed homes among its for-sale listings nationwide than

However, in response, Zillow’s spokesperson Amanda Woolley cautioned in a statement, “Anyone can selectively pull data to tell the story they want to tell.”

“The fact is, Zillow and Trulia listings breadth is more comprehensive and accurate than it has ever been, with more than 350 direct MLS partnerships signed in just the past year,” according to the statement.

“And the Zillow brand continues to be the most favored consumer brand by far, with more than half of all real estate category visits coming to Zillow, which is nearly double the size the nearest competitor,” Woolley added.

The HELOC is back!

Posted in Economics, Employment, Housing Recovery, Risky Lending | 80 Comments

From the NYT:

Cashing in on Home Equity

Rising home prices are raising equity levels, and homeowners are cashing in on these gains.

In the first three quarters of this year, the sales volume of single-family homes and condominiums reached the highest level since the same period in 2006, according to RealtyTrac, a provider of property data. Homeowners who sold during the third quarter also reaped the highest price gain in eight years — an average of 17 percent over their purchase price, or $40,658.

Other data shows that homeowners are taking advantage of rising values by refinancing their mortgages in order to cash out a portion of their equity.

The group of homeowners that RealtyTrac categorizes as “equity rich,” meaning they have at least 50 percent equity in their homes, has been increasing over all, said Daren Blomquist, a vice president of RealtyTrac.

But in the third quarter, the share declined from the quarter before, to 19.2 percent of all homeowners with a mortgage from 19.6 percent. The group with less than 50 percent equity, however, grew, while the ranks of those with negative equity shrank.

“What that tells me,” Mr. Blomquist said, “is that people are either selling and moving into a bigger home, or refinancing it and leveraging some of that equity, so they don’t have as much equity in the home as they did before.”

Refinancing activity in general has risen in recent months, as interest rates have remained low. In September, refinanced loans represented 42 percent of lenders’ loan volume, according to Ellie Mae, a software provider for the mortgage industry. That was a 5 percent increase over August, and the highest level since May.

In many mid- to high-end housing markets, rising home prices have made it difficult for existing homeowners to move up, said Norman T. Koenigsberg, the president and chief executive of First Choice Loan Services in East Brunswick, N.J. As an alternative, he said, “families are tapping into their equity to improve their homes, either as a long-term strategy or to enable them to resell it sooner at a greater profit.”

Foreclosures Jump in October

Posted in Economics, Foreclosures, Housing Recovery, New Jersey Real Estate | 91 Comments

From HousingWire:

RealtyTrac: Foreclosure starts post highest jump in more than four years

Foreclosure filings — default notices, scheduled auctions and bank repossessions — were reported on 115,134 U.S. properties in October, up 6% from the previous month. This is still down 6% from a year ago, the latest RealtyTrac Foreclosure Market Report for October 2015 showed.

The rise was caused primarily by a 12% monthly jump in foreclosure starts, with 48,605 properties starting the foreclosure process for the first time in October.

This increase marks the largest month-over-month increase since August 2011, when there was a 24% month-over-month increase. Despite the month-over-month increase, foreclosure starts in October were still down 14% from a year ago.

While this increase isn’t a giant surprise, it did exceed expectations.

“We’ve seen a seasonal increase in foreclosure starts in October for the past five consecutive years, so it’s not too surprising to see the monthly increase this October,” said Daren Blomquist, vice president at RealtyTrac.

“However, the 12% increase this October is more than double the average 5% monthly increase in the past five Octobers, and the even more dramatic monthly increases in some states is certainly a concern. The upward trend in foreclosure starts in those states in some cases could be an indication of fissures in economic fundamentals driving more distress and in other cases is more likely an indication of long-term delinquencies finally entering the foreclosure pipeline,” he added.

Broken up, October foreclosure starts increased from the previous month in 34 states, including California (up 21%), Florida (up 13%), New Jersey (up 15%), Illinois (up 20%), Maryland (up 300%), Washington (up 34%), and Michigan (up 37%).

New Jersey accounted for 7,559 properties receiving a foreclosure filing in October, a foreclosure rate of one in every 471 housing units. While the state’s foreclosure activity is down 4% from the previous month, it is still up 87% from a year ago.

Recently, Sens. Cory Booker, D-NJ, and Robert Menendez, D-NJ, sent a letter to the heads of the Department of Housing and Urban Development, the Federal Reserve Board, the Consumer Financial Protection Bureau, the Federal Housing Finance Agency and others, saying that the prevalence of zombie foreclosures in the state is seriously impacting the state’s residents and its economy, and they want to know what the federal regulators are going to do about it.

Warm up the bulldozers!

Posted in Economics, Employment, North Jersey Real Estate | 64 Comments

From the WSJ:

Hudson River Rail Tunnel Project Takes Another Step Forward

An emerging plan to dig two new Hudson River rail tunnels came into sharper focus on Wednesday as state and congressional leaders outlined a plan to fund and manage the project.

Under an agreement announced late Wednesday, the project would be managed by a subsidiary of the Port Authority of New York and New Jersey. That development corporation would be overseen by a four-member board including two representatives of the bistate agency and one each from Amtrak and the U.S. Department of Transportation.

New York Gov. Andrew Cuomo and New Jersey Gov. Chris Christie, who announced the deal with two U.S. senators, jointly control the authority.

“Our shovels are ready,” Mr. Cuomo said in an interview. “Literally, if you don’t build this tunnel, you would greatly imperil train service.”

Anthony Coscia, Amtrak’s chairman, said the agreement among state and federal leaders marked an encouraging step for Amtrak’s broader Gateway project. “It’s going to be a real turning point,” he said.

The national passenger railroad has struggled to fund big projects, and has warned of a transportation crisis if it must shut down one of its aging two current tunnels between New York and New Jersey.

It remains unclear how the local, state and federal governments will fund the tunnel project in an era of tight budgets. The project is part of the Gateway plan, which early estimates suggest could cost $15 billion to $20 billion.

But the state and congressional officials said the agreement included a commitment by U.S. transportation officials to secure financing for at least half the tunnel project’s costs. In September, the two governors agreed to foot half of the project’s costs if the federal government picked up the rest.

The national passenger railroad has struggled to fund big projects, and has warned of a transportation crisis if it must shut down one of its aging two current tunnels between New York and New Jersey.

It remains unclear how the local, state and federal governments will fund the tunnel project in an era of tight budgets. The project is part of the Gateway plan, which early estimates suggest could cost $15 billion to $20 billion.

But the state and congressional officials said the agreement included a commitment by U.S. transportation officials to secure financing for at least half the tunnel project’s costs. In September, the two governors agreed to foot half of the project’s costs if the federal government picked up the rest.

Christie wants to raise taxes on NJ

Posted in New Jersey Real Estate, Politics | 116 Comments

From the Star Ledger:

Christie’s new tax plan would cost 40% of N.J. taxpayers an average $16,682 deduction

Gov. Chris Christie wants to do away with a tax break that his state’s residents use more than almost anyone else.

During Tuesday’s Republican presidential debate, Christie talked about his plan to reduce income taxes, including for the top bracket for the richest taxpayers, and keep only the tax breaks for home mortgage interest and charitable deductions.

Gone under Christie’s plan would be the federal deduction for state and local taxes, which New Jersey taxpayers use more than residents of almost any other state.

“That will put more pressure on governors and on local officials not to keep raising those taxes, saying we can deduct them,” Christie said in Milwaukee, where he participated in the preliminary debate after his poll average was too low to qualify for the main stage.

According to Internal Revenue Service statistics, 41.4 percent of New Jersey taxpayers took the state and local tax deduction, which lowered their federal income taxes, in 2013, the last year for which figures were available. Only Maryland and Connecticut had a higher percentage.

Housing confidence dips in October

Posted in Demographics, Economics, Employment, Housing Recovery | 82 Comments

From HousingWire:

Fannie Mae: Consumer confidence in housing market fell in October

Consumers’ feelings towards the housing market were weaker in the month of October than they were in September, as some consumers displayed hesitancy to commit to the long-term financial obligation of buying a home, a new survey from Fannie Mae showed.

Released Monday, Fannie Mae’s Home Purchase Sentiment Index for October 2015 decreased slightly to 83.2 in October as consumers’ volatile outlook on both household income improvement and mortgage interest rates kept housing sentiment relatively flat.

In October, the HPSI Household Income component fell 4 points on net this month and the Good Time to Buy and Good Time to Sell components fell 2 and 6 points, respectively, after picking up in September.

While those number fell in October, signifying weakening confidence in the housing market, the survey results showed that consumers appeared to be less worried about job loss, with the net figure nearing the most favorable reading in the five-year history of Fannie Mae’s National Housing Survey.

Additionally, the share of consumers who think mortgage interest rates will go down increased by 4 points on net in October.

“The income growth necessary for renewed momentum in housing market sentiment remains elusive, even though consumers’ confidence in their job security continues to strengthen,” said Doug Duncan, senior vice president and chief economist at Fannie Mae.

“Consumers’ net view on whether their household income has improved over the last year is down once again this month,” Duncan continued.

“Some consumers may be hesitant or unwilling to commit to buying or selling a home without seeing meaningful improvement in their wages and salaries,” Duncan added. “Still, the HPSI remains close to its near all-time high level of the past four years and, given the strong October jobs report, suggests that any cooling in near-term activity, if it occurs, should be moderate.”

Overall, Fannie Mae’s October 2015 Home Purchase Sentiment Index decreased 0.6 percentage points to 83.2 in October following a 3-point increase last month to near its peak level.

The net share of respondents who say they are not concerned with losing their job rose 2 percentage points to 71%, and has risen each month since July. The percent of respondents who are not concerned about losing their job reached an all-time high of 85%.

Where’s the money? Here.

Posted in Demographics, Economics, Employment | 123 Comments

From MarketWatch:

Where’s the money in America? This 3D map will show you

The hardest working states and regions in America? Sorry flyover states, better luck next time. The kings of production remain in the most obvious spots: California, Texas and New York.

The Bureau of Economic Analysis and the U.S. Department of Commerce recently pushed out some statistics on gross domestic product in 2014 for the U.S. based on metropolitan areas. The folks at took that data and turned it into a map that demonstrates just where the growth in the U.S. is coming from. As shown below, the higher the cone rising from the map, the bigger the GDP in that region.

“In analyzing the data, we found that the top 20 metropolitan areas represent over 52% of the total GDP in the U.S.,” said Raul Amoros, director of content development at

Spiking right out of the map, was the New York region, which includes Newark and Jersey City., with a whopping contribution of $1.56 trillion in GDP and growth of 2.4% in 2014. That region provided nearly 10% of the total GDP for the whole of the U.S.

Just behind it, the Greater Los Angeles area was second with $866 billion in GDP, with a 2.3% rise over 2013. Third and fourth, respectively, was the Chicago metro area, with $610 billion and growth of 1.8%, and the Houston metro area with $525 billion. Dallas stole the fifth spot with $504 billion.