Welcome to today’s Real Estate news roundup! In California, cities are exploring new tactics to evade state housing laws after a recent ruling exempted certain cities from controversial regulations. This has sparked interest in other cities considering becoming charter cities to gain more autonomy from state housing laws. Meanwhile, the California Association of Realtors has made a deal on a ballot measure to reduce the voter approval threshold for housing bonds, with a carve-out that excludes single-family homes. In the Bay Area, home prices have hit another record high despite a slump in home sales, highlighting the persistent shortage of affordable housing. Additionally, mortgage activity has slumped, impacted by the highest interest rates in over 20 years. Despite these challenges, there are indications of a gradual easing of rates and efforts to address the housing market’s impact on the economy. Join us as we delve into these stories and explore the latest developments in the real estate landscape.
These cities have a new tactic to evade California housing laws. Legal experts are dubious | LAist
When a judge ruled recently that a controversial state housing law did not apply to a handful of southern California cities, it sparked interest in other cities looking to evade similar regulations. Pleasanton, Brentwood, and Atherton are among the California cities considering becoming charter cities to gain more autonomy from state housing laws.
The ruling by Los Angeles County Judge Curtis Kin stated that the state law allowing homeowners to split their houses into multiple units did not apply to charter cities like Redondo Beach, Carson, Torrance, Whittier, or Del Mar. This decision has inspired other cities to explore the possibility of becoming charter cities to avoid state housing regulations.
Becoming a charter city requires local voter approval and the creation of a comprehensive governing document known as a charter. While legal experts are skeptical about the long-term impact of this strategy, cities like Pleasanton, Brentwood, and Atherton are taking the first steps towards adopting a charter.
California housing: Realtors make a deal on ballot measure – CalMatters
The California Association of Realtors agrees not to oppose a constitutional amendment to reduce the voter approval threshold for housing bonds. In exchange, the measure will not apply to single-family homes. Some housing advocates are angry about the carve-out.
A November ballot measure to make it easier for local governments to borrow money for new infrastructure and affordable housing will likely include a big exception, preventing that money from being used to buy single-family homes. That’s thanks to a last-minute deal hammered out between a top legislative Democrat and the state real estate lobby.
Making it easier to pass housing bonds is a top priority for affordable housing advocates this year. That’s especially true for those in the San Francisco Bay Area, where a first-of-its-kind regional housing finance authority plans to float an IOU of as much as $20 billion to fund housing projects across the region, if voters approve in November.
California home prices hit another record, while prices in one Bay Area county was far below state median
A fire that broke out Monday in Redwood City and consumed an affordable housing building under construction has been contained to the structure of origin, according to the San Mateo County Sheriff’s Office. Meanwhile, the Bay Area experienced the biggest jump in home prices on a year-over-year basis in California last month, despite a statewide slump in home sales. The median home price in the Bay Area exceeded $1.45 million for an existing single-family home, up almost 12% from the same time last year. The persistent shortage of homes for sale, particularly in the more affordable market segments, continues to push up California’s median home price to new record highs. To learn more about the latest trends in California’s real estate market, click here.
Homebuilding sags to four-year low, stifled by higher-for-longer rates | CFO Dive
Mortgage activity slumped last month, falling 8.5% compared with April and 7.3% compared with May 2023, according to a report by Freddie Mac. The housing market has been particularly affected by the highest interest rates in over 20 years, impacting U.S. economic growth. Housing inventory remains below the level necessary for a balanced market, leading to affordability challenges. Despite indications of slower consumer spending and economic growth, mortgage rates have declined slightly in recent weeks. While an immediate cut in the federal funds rate is not expected, there may be a gradual easing of rates if inflation cools and the job market slows. To learn more about the current state of homebuilding and its impact on the economy, click here.