Housing Cool-Down Is ‘Orderly,’ Fed Chief Says
Pointing to the strength of the overall economy, Federal Reserve Chairman Ben Bernanke said that the current slowdown in the housing market is “moderate” and “orderly.” “We’re seeing slowing in sales, slowing in starts,” he said following a speech in Chicago, according to Bloomberg News. “There also seem to be signs that prices are not rising as quickly as they have been for the past few years.” The chairman’s comments came as Freddie Mac announced that the average rate on a 30-year fixed-rate mortgage hit 6.6% in its latest weekly survey, the highest in almost four years. Citing “no evidence that prices are going to collapse,” Bernanke’s predecessor, Alan Greenspan, predicted that the U.S. housing market is likely to follow the path set in Australia and Great Britain, where booms were followed by a flattening out of prices. However, Greenspan noted that the impact of the cooling-off period for housing on the general economy is not yet clear. To the extent that rising home prices and inexpensive home equity loans have been fueling consumer spending, he said, “there is going to be some slowing of consumption.” (www.washingtonpost.com)
Washington Post (5/19/06); Tomoeh Murakami Tse
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Why Perth Is Booming
The prospect of persistently high energy prices has created a new wave of boomtowns such as Calgary, Canada; Nagoya, Japan; Perth, Australia; Casper, Wyo.; and Midland, Texas, according to Joel Kotkin, an Irvine senior fellow at the New America Foundation. Located near the vast oil sands of Alberta, and with low taxes and a business-friendly environment, Calgary is arguably North America’s fastest growing city, he said. The office vacancy rate in downtown Calgary is just 1.7%, and more than 1 million square feet are planned for downtown and another 1 million for the city’s suburbs. Oil prices, Kotkin says, have set off changes in such energy-saving areas as Wyoming, which experienced some of the nation’s slowest income growth in the 1990s but is now getting rich faster than any other state. Casper and Gillette are filling up with workers from the rest of the country, as well as immigrants, and one recent survey finds that Wyoming since 2000 has enjoyed the fastest growth in personal income in the country. Such unlikely places as Montana, North Dakota, New Mexico and coal-rich West Virginia are not too far behind. But it looks like Texas will come out the biggest long-term winner in the energy sweepstakes, and Houston may be the big city with the most to gain from continued high energy prices. With local energy firms returning to the oil fields, the city’s job growth this year may exceed 3%, roughly twice the national average, according to Houston Federal Reserve economist Bill Gilmer. (www.latimes.com)
Los Angeles Times (5/14/06); Joel Kotkin
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When Mom (or Dad) Moves In
Anecdotal evidence suggests that there could soon be a surging wave of baby boomers who are modifying their homes to add senior-suitable space for their parents. The 2000 Census found that 4% of U.S. households, or 3.9 million, had three or more generations living together, and one-third of those featured parents who had invited grandparents to move in. Vince Butler, chairman of the NAHB Remodelors™ Council, says that the three-day CAPS (Certified Aging-in-Place Specialist) program to enable contractors to make homes friendly for grandparents “is the fastest-growing course we offer.” Originally, he said, “the goal was to explain that there’d be demand for this in the market. That’s not necessary now.” Butler says his clients have embraced everything from wider doorways and halls, which allows for wheelchair access, to oversized stacked closets that can be easily converted into an elevator shaft. “They like to say, ‘Oh, it’s for my parents,’ but you can tell they’re excited about having these additions for the day that they find it harder to get around.” (www.usatoday.com)
USA Today (5/15/06); Marco R. della Cava
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‘Skinny Streets’ Movement Winning Wider Acceptance
Madison, Wis. estimates that it will save 15% on road construction and maintenance in the denser subdivisions where it has just extended its eight-year-old skinny streets ordinance that allows 28-foot-wide thoroughfares instead of the standard 32-foot width in neighborhoods of five or more units per acre. The city will also benefit by deriving more green space, reduced storm water runoff, slower traffic and fewer accidents. Madison Mayor Dave Cieslewicz said that the skinny streets were not an easy sell to the fire department, public works officials and traffic engineers who feared that emergency trucks, snowplows and other vehicles would have difficulty negotiating the narrower widths, and to appease these critics, the program will be reviewed after a few years. If there are problems, on-street parking may be eliminated in some areas. Spokesmen for NAHB and the Urban Land Institute said that opposition to narrow streets is yielding to the influence of New Urbanism and the smart growth movement, both of which stress compact development. Jim Charlier, a Boulder, Colo. transportation consultant, notes that people are beginning to figure out that the money they spend on excessively wide streets can be put to better uses, such as drainage swales and other natural forms of storm water management, more trees and more thoughtful public spaces, all of which make for enduringly beautiful neighborhoods. (www.onwisconsin.com)
Milwaukee Journal Sentinel (5/14/06); Whitney Gould
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The ‘Mini-Me’ Structure Is the Latest Addition to the High-End Lifestyle
While the stately pool house is fast evolving from an estate luxury to just another must-have amenity for high-end home owners, only a small percentage of homes will actually have one, according to Gopal Ahluwalia, director of research at NAHB. “You are looking at 1% of homes in the country with a pool house,” he said. “The data shows that consumers want more of everything in the house. They want more amenities, and when people are wealthy, it doesn’t matter to them what things cost.” Al Giaquinto of Plum Builders of East Hampton, N.Y., says that his customers are looking for the same high quality in their pool houses they want in their kitchen and bathrooms. He may use French limestone, Italian giallo silva marble and nickel hardware in his pool house jobs, which can cost $500 a square foot. In East Hampton, where a “good third” of all new construction costing more than $1 million contains plans for a pool house, according to building inspector John Bishop, the size is limited to 200 square feet and it cannot contain a stove or heating, to prevent it from becoming a rental unit. The cost of a pool house these days, according to one local landscape developer, is in the $50,000-$200,000 range, up from $30,000-$75,000 10 years ago. (www.newsday.com)
Newsday (5/18/06); Carol Polsky
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Harmonic Emergence
The test of good outdoor design is its ability to create a sense of ease, according to Sarah Susanka and landscape designer Julie Moir Messervy, co-authors of a new book, “Outside the Not So Big House.” For example, the typical elevated deck, they say, makes the home owner feel exposed and disconnected, and a deck will feel more comfortable when it is on the ground floor. The authors say the focus should be on designing a landscape as you might a house, emphasizing quality over quantity and then linking the two in an artful combination. Although the land around a home is usually what’s left after the ever-larger house is put on the ever-shrinking lot, more people are seeing the potential of the yard and hiring landscape companies to design and build living spaces, some with full-blown outdoor kitchens. Susanka advises that home owners can make the same design mistakes outdoors as those that can occur inside, heightening the importance of dealing with design professionals. (www.washingtonpost.com)
Washington Post (5/18/06); Adrian Higgins
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