Retail Job Growth Suffering, Threatens Apartment Market Demand Online stores cutting into employment

Written by Apartment Management Magazine on . Posted in Blog

By Louis Rosenthal | Axiometrics.com

Despite many bright spots in the latest employment survey from the BLS, one sector of the economy continues to deteriorate: retail employment. But not all retailers are feeling the same pinch, and the differential job growth (or losses) across retail categories paint a complicated picture of the strength of the single-family and apartment markets.

The recent demise of several well-known retailers, including Payless and The Limited — to say nothing of struggling brands like Lululemon and Urban Outfitters — might seem odd in the face of strong retail sales in general.

But while retail sales are growing, much of this gain is driven by online retailers, including Amazon, at the expense of more traditional retailers based in shopping centers or malls. Whereas all retail sales increased by 5.5% in March (compared to March 2016), non-store retail sales increased by 11.9% compared to the year prior.


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With the change in consumer spending behaviors, bankruptcies and store closings are growing. Nearly 98 million square feet of retail space was vacated due to store closings in 2016, according to JLL — the highest level since 2008. Furthermore, nine retailers have announced bankruptcies thus far in 2017 — the same number as all of 2016.


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Changes in the retail job market reflect the diverging fortunes of retail sales.


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Retail jobs grew by only 0.5% on an annualized basis in April, compared to 1.3% in January and 1.6% in April 2016. But April’s job growth numbers look rosy compared to specific retail categories like electronics and appliance stores, department stores and general merchandise stores — each of which has been losing a significant number of jobs.


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However, there is one particular retail category currently seeing excellent job growth: furniture and home furnishing stores.


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While all retail establishments increased employment levels by only 0.5% in April (compared to April 2016), furniture and home furnishing stores have increased employment levels by 3.1%.

This tells us something interesting about the state of the economy and the housing market in particular. For one, it suggests a strong single-family housing market, which means people are spending more on home-related items. So, while retail sales and employment levels are growing at a relatively slow pace, this is not indicative of a broader slowdown in the economy — or a recession.

For the apartment market, a strengthening single-family market is good news, as it points to a stronger economy in general. But the incredible numbers of jobs lost in specific retail categories threaten to depress apartment demand — particularly class B and C apartments which cater to service-sector employees.

In short, the story of retail employment in 2017 is more complicated than it initially appears. Retail sales are still growing, but most of the growth is concentrated among non-traditional retailers, such as Amazon. As a result, traditional retailers are shedding jobs (or increasing them at a slower pace), just as non-traditional retailers are adding them at a robust pace. The differential job gains across retail categories (particularly for home furnishing retailers) points to a strong economy, which should boost the apartment market. But, at the same time, fewer jobs mean less demand for apartments.

For a case study of the impact of new technologies on employment, look no further than the retail market. The consequences for apartments should become evident in the not-so-distant future.

Louis Rosenthal

Real Estate Analyst

Louis Rosenthal researches and analyzes current apartment trends in the United States and correlates them with economic indicators. He also studies the urban landscape and other metrics to develop in-depth reports and presentations for clients. Louis recently earned his Master of Science in Public Policy, focusing on housing, landuse patterns, real-estate dynamics and economic development. He combines that knowledge with his four years of practical experience in tax analysis, regression analysis and presentations to develop insightful analysis. An accomplished writer, Louis’ work has appeared on Forbes.com and Axiometrics’ blogs, among others.

10 Tips for Successful Real Estate Property Investment

Written by Apartment Management Magazine on . Posted in Blog

by: Agustin Diaz & Christine Collura | Keller Williams & Estates

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Just because real estate prices seem to have hit a temporary ceiling in many countries around the world, that doesn’t mean that profits from property investments are hard to come by.

Even during a real estate market slowdown, stagnation or depression profits can be made locally and overseas. This article shows you the top ten tips that real estate investors apply to their property portfolio building strategy to ensure success from their investments.

1) Research the curve – the concept of a property market cycle existing is not myth it’s a fact and is generally accepted to be based on a price-income relationship. Check the recent historical price data for properties in the area of the country you’re considering purchasing in and try to determine the overall feel in the market for prices currently. Are prices rising, are prices falling or have they reached a peak. You need to know where the curve of the property market cycle is at in your preferred investment area.

2) Get ahead of the curve – as a basic rule of thumb, professional real estate property investors seek to buy ahead of the curve. If a market is rising they will try and target up and coming areas, areas that are close to locations that have peaked, areas close to locations experiencing redevelopment or investment. These areas will most likely become ‘the next big thing’ and those who by in before the trend will stand to make the most gains. As a market is stagnating or falling many successful investors target areas that enjoyed the best levels of growth, yields and profits very early on in the previous cycle because these areas will most likely be the first areas to become profitable as the cycle begins turning towards positive once more.

3) Know your market – who are you buying property for? Are you buying to let to young executives, purchasing for renovation to resell to a family market or purchasing jet to let real estate for short term rental to holiday makers? Think about your market before you make a purchase. Know what they look for in a property and ensure that is what you are going to be offering them

4) Think further afield – there are emerging real estate property markets around the world where countries’ economies are going from strength to strength, where a growing tourism sector is pushing up demand or where constitutional legislation has been or is about to be changed to allow for foreign freehold ownership of property for example. Look further afield than your own back yard for your next property investment and diversify that real estate portfolio for maximum success.

5) Purchase price – set yourself a budget that will realistically allow you to purchase what you’re looking for and profit from that purchase either through capital gains or rental yield.

6) Entry costs – research fees, charges and all expenses you will incur when you buy your property – they differ from country to country and sometimes even from state to state. In Turkey for example you should add on an additional 5% of the purchase price for all fees, in Spain you will need to factor in an average of 10% and in Germany fees and charges can be in excess of 20%. Know how much you will have to incur and factor this amount into your budget to avoid any nasty surprises and to ensure your investment can become profitable.

7) Capital growth potential – what factors point to the potential profitability of your real estate property investment? If you’re looking overseas at an emerging market, which economic or social indicators exist to suggest that property prices will increase? If you’re buying to let out are there any indications to suggest that demand for rental accommodation will remain strong, increase or even decline? Think about what you want to achieve from your investment and then research and find out whether your expectations are realistic.

8) Exit costs – if you will incur substantial capital gains taxation liability if you sell your property investment for profit, will that render the investment profitless? In Spain a foreign buyer can incur up to 35% capital gains tax, in Turkey on the other hand property sales are capital gains tax free if the underlying real estate has been owned for four or more years.

9) Profit margins – what levels of capital growth can you realistically gain on your property investment or how much rental income can you generate? Work out these facts and then work backwards towards your initial budget to work out your potential profit margins. At all times you have to keep the bigger picture in mind to ensure that your real estate investment has good potential for profit.

10) Think long term – unless you’re buying property off plan and intending to flip it for resale and profit before completion you should view real estate investment as a long term investment. Real estate is a slow to liquidate asset, cash tied up in property is not simple to free up. Take a long term approach to your property portfolio and give your assets time to increase in value before cashing them in for profit.

Property News Reports – Is the Bubble About to Burst?

Written by Apartment Management Magazine on . Posted in Blog

Kathy specializes in teaching people how build multi-million dollar real estate portfolios through creative finance and planning. She is passionate about researching and then sharing the most important information about real estate, market cycles and the economy. Author of the #1 best seller, Retire Rich with Rentals, Kathy is a frequent guest expert on such media as CNN, CNBC, Fox News, NPR and CBS MarketWatch. Learn more about Kathy & the Real Wealth Network at http://www.RealWealthNetwork.com

Rent Control Update

Written by Apartment Management Magazine on . Posted in Blog

By Richard Page |  CPA/RETIRED IRS AGENT

3d House (XXL)

As many of you will recall, Proposition 13 generally “froze” the reassessment of residential income properties. Simply stated, the County Assessor did not, from year to year, generally reassess the Properties. Proposition 13 does allow for a modest increase.

When a property is sold, the County Assessor may, at that time, reassess the Value based upon the new sales price.

Additionally, Proposition 13 does permit the County Assessor to re-evaluate the Value if a Homeowner or Apartment Owner does substantial “new construction” to the property. However, Proposition 13 prohibits the Tax Assessor from “ re-evaluating new construction for property tax purposes when the purpose of the ‘new construction’ is to seismically retrofit an Existing building”. In 2010, the California Constitution was amended to memorialize this arrangement.

Simply stated, if you are required to undertake Earthquake retrofit, and you spend substantial sums of money for that purpose, the California Constitution will protect you, provided:

A specialized Form is being enacted at the present time. Nonetheless you may contact the Assessor’s Office, Robert Lippson, (213) 974-7736, or helpdesk@assessor.lacounty.gov for this information.

Of course, all of these governmental “exemptions are always time-sensitive. Owners must submit the “form” prior to or within 30 days of the completion of the seismic-retrofit work. They must submit documents supporting the claim no later than six months after the completion of the seismic-retrofit project. The Property Owner, his contractor, architect or civil structural engineer may complete the claim forms and providing the supporting documents.

Once the taxpayer/ Apartment Owner has submitted the claim form and the supporting documents, the City Building Department may be required to identify the portion of the project that was the seismic-retrofitting component. That will determine whether the property is “exempt” from the new assessment, or has undergone new construction … unrelated to the seismic-retrofit that may trigger a new assessment.

As always, it’s important and essential that you attend the ACTION monthly Membership meetings. Tax consultations and matters involving property assessments are highly complex and incredibly difficult to address.

It is essential and important that you consult your Certified Public Accountant, Public Accountant, and others in preparing these forms so that you can benefit from the exemption.

Richard Page has a tax controversy practice in Santa Monica. His phone number is (310) 450-8875, and his email is pagecpa@gmail.com

Repeal 1995 Costa-Hawkins Fair Housing Act

Written by Apartment Management Magazine on . Posted in Blog

By Michael Millman | Action Apartment Association

OPPOSITION

Prior to the enactment of Costa-Hawkins, communities like Berkeley, Santa Monica and West Hollywood had well-documented antagonism between Tenants and Apartment Owners.

Today, there is harmony. Vacant units are repaired, restored and beautified. They’re offered for rent at Market rates. People love their rental units, and are secure and comfortable in paying a negotiated Market rate. The units then fall under Rent Control, and the annual rental adjustments are limited and restricted by municipal formulas. Over the last five or six years, the rate of increase has been less than 1% in West Hollywood, and slightly higher in Santa Monica.

80% of the Rent Control units in Santa Monica are probably rented at or near Market rent. Everyone’s happy. Those Tenants who are “rent burdened” or have some other type of financial hardship are able to live with security in their rental units because the rental building enjoys “decontrolled” rental arrangements.

Yes, an elderly Tenant in a large one-bedroom apartment a few blocks from Santa Monica Beach probably only pays $400 per month.  A similar unit in the building probably rents for $1,600 per month. The Market rents underwrite the people who are protected by Rent Control.

The system works.

The elderly and the disabled get to live in their apartments, and the Owners generate sufficient rent to underwrite the operation. Remember, within a few months, these same cities will adopt earthquake seismic retro fit, and they intend to make the Owners pay 100%.  No pass-through. These retrofit projects may cost over $100,000 per apartment unit.

Remove the Costa-Hawkins “free enterprise/vacancy decontrol” and these Small Apartment Owners will give up the Business and simply close down. They don’t have the money. And certainly no bank is going to loan money on an apartment building if Richard Bloom’s new Bill to repeal Costa-Hawkins is passed. Complete economic collapse.

EXEMPTION

As you will recall, under Costa-Hawkins, condominiums, single family dwellings, new construction, and of course new rental candidates after January 1, 1999 are EXEMPT from Rent Control.

Groups who will FIGHT, CHALLENGE AND OPPOSE this bill:

• The union trade organizations, new apartment developers, developers of senior and very low income complexes, small apartment owners and even the mega apartment owners represented by CAA.

• Those who want affordable housing in Inglewood, Mar Vista, Culver City, and even Santa Monica

• Business-friendly Legislators who want good-paying jobs for their District.

The unintended consequences are very detrimental and dangerous.

People will panic. Apartment Owners will immediately accelerate rental increases in decontrolled areas of the South Bay, Inglewood, Lawndale, Long Beach, Culver City and other jurisdictions. This is dangerous.

Be fair, and remove and Kill this Bill.

Why are so many 1031 investors choosing to 1031 exchange into Delaware Statutory Trust (DST) properties?

Written by Apartment Management Magazine on . Posted in Blog

By Dwight Kay | Kay Properties & Investments

From eliminating the struggles of property management to owning investment grade real estate, the potential benefits of opting to 1031 exchange into DST properties are many. At Kay Properties and Investments, we’re specialists in the DST 1031 exchange marketplace, and provide our clients with superior, knowledgeable advice to help them make informed decisions about their investments. We also are careful to help our investors understand the risks and disadvantages of real estate and DST properties.

Understanding Delaware Statutory Trust Real Estate

Real Estate investors all over the country are choosing 1031 exchanges into DST offerings as a way to defer their capital gains tax, diversify their real estate portfolio, increase the possibility of increasing their cash flow and much more. But what is a DST 1031 Property exactly? With a minimum investment of $100,000, DST 1031 properties give investors more leeway to spread their proceeds into multiple properties. Some call this similar to 1031 exchanging into a REIT however, a REIT is not like kind for a 1031 exchange and yet a DST is. With the DST we are able to create a broadly diversified portfolio of between 1-50 properties for our investors. Understanding the current DST properties for sale and how to construct a quality portfolio for our clients is what we do best. Contact us today to learn how we can help you with a free consultation. (www.kpi1031.com or info@kpi1031.com)

Types of DST Listings

The types of DST 1031 properties available can vary greatly, with the common properties being triple net (NNN) leased single tenant retail, apartment communities, medical properties, office properties and all-cash/debt-free properties. With a NNN leased property, tenants are typically responsible for taxes, maintenance and insurance, potentially leaving the investor with less responsibility in terms of property management and costs and a “net” amount of rent each month.

At Kay Properties we typically have access to 15-30 different DST listings from many of the DST sponsor companies in the industry as well as our own proprietary Kay Properties client exclusive DSTs just for our clients. If you’re interested in learning more about how 1031 exchanging into Delaware Statutory Trust properties could potentially work for you, give us a call today! 1(855) 466-5927

This material does not constitute an offer to sell nor a solicitation of an offer to buy any security. Such offers can be made only by the confidential Private Placement Memorandum (the “Memorandum”). Please be aware that this material cannot and does not replace the Memorandum and is qualified in its entirety by the Memorandum. This material is not intended as tax or legal advice so please do speak with your attorney and CPA prior to considering an investment. This website contains information that has been obtained from sources believed to be reliable. However, Kay Properties and Investments, LLC, Colorado Financial Services Corporation and their representatives do not guarantee the accuracy and validity of the information herein. Investors should perform their own investigations before considering any investment. There are material risks associated with investing in real estate, Delaware Statutory Trust (DST) and 1031 Exchange properties. These include, but are not limited to, tenant vacancies; declining market values; potential loss of entire investment principal; that past performance is not a guarantee of future results; that potential cash flow, potential returns, and potential appreciation are not guaranteed in any way; adverse tax consequences and that real estate is typically an illiquid investment. Please read carefully the Memorandum and/or investment prospectus in its entirety before making an investment decision. Please pay careful attention to the “Risk” section of the PPM/Prospectus. This material is not intended as tax or legal advice so please do speak with your attorney and CPA prior to considering an investment. IRC Section 1031, IRC Section 1033, and IRC Section 721 are complex tax codes, therefore, you should consult your tax and legal professional for details regarding your situation. Securities offered through registered representatives of Colorado Financial Service Corporation, Member FINRA / SIPC. Kay Properties and Investments, LLC and Colorado Financial Service Corporation are separate entities. OSJ Address: 304 Inverness Way S, Ste 355, Centennial, Colorado. Kay Properties & Investments, LLC, is registered to sell securities in all 50 states. DST 1031 properties are only available to accredited investors (generally described as having a net worth of over $1 million dollars exclusive of primary residence) and accredited entities only (generally described as an entity owned entirely by accredited individuals and/or an entity with gross assets of greater than $5 million dollars). If you are unsure if you are an accredited investor and/or an accredited entity, please verify with your CPA and Attorney prior to considering an investment. You may be required to verify your status as an accredited investor.

BEWARE. Fed Rate Hike Could Burst Bubbles

Written by Apartment Management Magazine on . Posted in Blog

By Kathy Fettke | RealWealthNetwork.com

FedRateHike

The Federal Reserve followed through on its latest promise to raise interest rates. Fed Chief Janet Yellen announced a quarter point hike in the federal funds rate Wednesday. But the increase has little to do with the ripple effect on mortgages and consumer loans, and more to do with a message from the Fed about the economy.

This is the first rate hike of 2017 and the third since December of 2015 when the cycle of monetary tightening began after the Great Recession. The first rate hike brought the overnight lending rate a quarter percent off zero. The second rate hike three months ago, raised it another quarter point. The latest increase brought it to a range of 0.75% to 1%, which is still quite low historically.

Consumer loans may notch up a bit because of the rate hike but economists say with so much talk about the increase, many lenders have already priced it in. And some economists say the hike has more to do with Yellen’s desire to portray the economy as “healthy” than it does with monetary policy.

She said during a press briefing: “We have confidence in the robustness of the economy and its resilience to shocks.” And that: “It’s performed well over the past several years. We’ve created, since the trough in employment after the financial crisis, around 16 million jobs.”

Raising the Fed Fund rate is supposed to correspond with a robust economy. Increases are meant to keep inflation in check. If economic growth and inflation are rising too quickly, a rate hike helps slow them down as it tightens the money supply.

Core inflation is about 1.9% right now. Up slightly from the previous forecast and right in the 2% range that the Federal Reserve has been targeting.

But there are big questions about U.S. economic growth.

If you focus on the stock market, you might think the economy has been advancing rapidly. Wall Street has been on a bull run since President Trump was elected with the Dow hitting over 21,000 for the first time ever.

There’s also been a steady increase in jobs with unemployment dropping from the double digits during the recession to under 4.7% right now. That’s giving consumers confidence about the economy, despite flat wages. The February report on consumer confidence says it hit a 15-year-high of 114.8.

But what some economists are pointing out is the troubling lack of economic growth. Chief investment strategist at Clarity Financial, Lance Roberts, wrote in a blog, that: “Outside of inflated asset prices, there is little evidence of real economic growth.” And that’s one thing that Janet Yellen said a rate hike would be tied to — economic growth.

The gross domestic product, or GDP, is our economic report card. And the Atlanta Fed just downgraded the first-quarter GDP to just .8%. That’s well off the 2% that Janet Yellen said is needed for a rate hike, leaving some economists wondering why the central bank went ahead and approved the increase.

Just weeks ago, the GDP was closer to the central banks rate hike comfort zone, at 2.3%. It also increased to 3.4% briefly last month after positive news about manufacturing and construction spending. But when disappointing data on retail sales and consumer prices came out a few days ago, the Atlanta Fed lowered its estimate to the .8% level.

Roberts says that charts show a rate hike at a time like this could actually push us into another recession. He told Market Watch that raising interest rates from ultra low levels at a time of slow economic growth could impact spending and that charts show this type of situation has lead to recessions in the past within three to nine months.

Nobel Prize-winning economist Robert Schiller is also warning people that Wall Street exuberance has gone overboard. He told Bloomberg that traders are captivated by President Trump’s bold plans to slash regulations, cut taxes, and “turbo-charge” the economy with an infrastructure building-boom.

He warns that when situations like this have happened in the past, it hasn’t ended well for the investors. Think dot-com bust and housing meltdown. Both experienced sharp drops in the stock market.

Schiller says investors are shoveling money into the market with the hope that President Trump will make good on his campaign promises. But they are also ignoring the enormous amount of uncertainty associated with getting those new policies through Congress and the legal system.

The Trump Administration is proposing some extreme budget cuts that may not sit well with some of his own constituents. A preliminary budget was introduced that slashes $54 billion from most federal agencies including the EPA, HUD, and Health & Human Services. That money will then be spent on defense. There’s also the affect of the Obamacare repeal. Depending on how many people lost their healthcare coverage, there could be a lot of unhappy voters. And if this political turmoil jostles the stock market, we could see a reversal that could happen quickly, and without mercy.

There has never been a slow letting out of air from a bubble. It usually bursts.

Kendrick Wakeman, the CEO of financial technology and investment analytics firm FinMason, told CNBC that investors are in for a rude awakening. He says no one knows when the stock market correction is coming. But, he says on average, the stock market crashes every eight to 10 years. And when it does, the average loss is about 42%.

He told CNBC that stock market investors need to ask themselves: “Would you hang yourself in the closet if the market crashed and you lost 35 percent?”

I have been warning investors for over a year now that a recession is coming. I’m sure some people think I’m crazy since the stock market has made significant gains since I gave this warning.

But remember, the same thing happened before the Great Recession and the Great Depression. In January of 2008, Ben Bernanke, the Chairman of the Fed said, “The Federal Reserve is not currently forecasting a recession.” 9 months laterin September of 2008, Lehman Brothers collapsed and the financial markets worldwide came tumbling down.

The Federal Reserve is supposed to be in charge of regulating the economy. It’s terrifying that they couldn’t see that recession coming… and even more frightening that they may have seen it coming, but didn’t warn us.

Be extremely defensive in your investing strategies today. Make financial decisions as if it were 2006. People who were prepared fared very well during the subsequent recession.

Rising interest rates can be the exact prick needed to pop the stock market bubble. That may be the very reason the Fed is raising rates – to slow down the irrational exuberance that taking the bubble to new heights.

A slowdown could turn into a meltdown, depending on how big that bubble has become.

How would a slow down in stocks affect real estate?

1. Cities that are more dependent on stock market fluctuations would be more affected by a stock market crash (SF, NY, Seattle).

2. Mortgage interest rates would decline if there were a correction in the stock market as more investors flock to the safety of bonds – which are more tied to the 10 year Treasury bond market.

3. Commercial real estate would get hammered while landlords could fare well as more people are forced to rent, driving rents up.

Now would be a very good time to “cash out” and sell your high priced assets while the market is hot. You can exchange those properties for low-priced, high cash flow properties in recession-proof markets.

If you have concerns about your portfolio or would like to speak with one of our investment counselors about how to find out which markets are best for investing today, visit www.RealWealthNetwork.com.

Kathy is an active real estate investor, licensed Realtor, certified coach, and former mortgage broker. She specializes in helping people build multi-million dollar real estate portfolios through creative finance and planning. With a passion for researching and sharing the most important facts on real estate and economics, Kathy is a frequent guest expert on such media as CNN, CNBC, Fox News, NPR, CBS MarketWatch and the Wall Street Journal. She is the author of the #1 best seller, Retire Rich with Rentals, and is host of The Real Wealth Show – which is a featured podcast on iTunes with listeners in 27 different countries.

L.A. Soft Story Ordinance and Implications for Condominium/Apartment Owners

Written by Apartment Management Magazine on . Posted in Blog

By: Dilip Khatri, PhD, SE | Principal Khatri International Inc.

earthquake property

Los Angeles is on the “Ring of Fire”.  The Ring of Fire circles the perimeter of the Pacific Ocean refers to areas of the high seismic activity because of multiple tectonic plates that have been moving/grinding against each other for millions of years.  It’s no surprise that we are in the center of seismic activity with total unpredictability.  The Earthquake risk element affects every aspect of life in Southern California, most notably our buildings where we live, work, and entertain, because it poses a threat to our very existence.

The Soft Story Ordinance, passed by the City of Los Angeles in 2016, encompasses residential and commercial buildings (4 or more units) that have a weak story line which leads to potential catastrophic circumstances:  The entire upper level may collapse on the weak first story.  In order to minimize this structural calamity, the Soft Story Ordinance requires building owners to upgrade/fix/enhance their buildings to reduce this risk.

Khatri_Figure1

Figure 1

Figure 1 demonstrates this principle and shows the collapse mechanism.  It’s no different from having a heavy object on “stilts”.  A lateral force applied to the upper floors will cause the structure to tip over.  The objective of the Ordinance is not to save the building/property.  Rather, the prime and single goal is to save the People inside the building.  Many property owners don’t realize this objective, and its important to be clear that the Ordinance is not trying to save property values, it’s main object is Life Safety.

The L.A. Ordinance officially affects approximately 14,000 buildings but that number is changing because new buildings are being added to the list, and other Cities in Los Angeles County are decidedly passing similar Ordinances.

Khatri_Figure2

Figure 2

There are several engineering options available to resolve this dangerous condition.  At least five repair options are to be considered:

  • New Steel Moment Frames
  • Strengthening existing Steel Moment Frames
  • Strengthening existing Wood Shear Walls
  • New Wood Shear Walls
  • New Steel Flagpole Columns

Figures 2 and 3 show a few schematics of a Steel Moment Frame and Wood Shear Wall.
My advice to owners is to look at each of these options and evaluate the “best choice” from an economic feasibility standpoint.

Khatri_Figure3

Figure 3

Each property is unique and requires personal attention of a structural engineer and contractor. It’s definitely not a “one size fits all” scenario.  Look around, shop around, and do some diligence before you commit to a specific solution/vendor approach.  The time lines for compliance are 7 Years from the date of notice, 2 Years for plans and permits.  If you are interested to learn more about the Soft Story Ordinance, this author has produced an online video for your reference: https://vimeo.com/194302379

Dr. Khatri has 31 years of civil engineering experience involving land development, subdivision, commercial, residential, multi-family, industrial, and educational facilities. Design, construction, and overall management of major infrastructure improvements comprising sewer, water, storm drain, flood control, and grading design.

Why Senior Citizens Should Consider their Financial Planning Options

Written by Apartment Management Magazine on . Posted in Blog

By Jess Walter

retirement

The idea of retirement often conjures up scenes of golden sunsets spent on a porch in California. The days flow by and there is not a care in the world, apart from ensuring that the cookies come out of the oven on time. This may seem like the ideal scenario, however, there is a slightly darker side to retirement that people are loathe to consider. The inevitability of death always weighs heavily on the minds of those who have reached a mature age, and provision for loved ones needs to be considered.

Seniors and Debt – What You Need to Know

Going into retirement without debt used to be the norm, but with the changes in the economy and the ease of obtaining debt, many seniors now have to face their golden years with debt repayments looming overhead. Although there are age restrictions on many types of debt, retirement often occurs before the age cut-off. Seniors are faced with steep monthly expenditures without the corresponding higher income that they’re used to. Furthermore, mounting costs in terms of healthcare often necessitate incurring further debt.

Property Still Remains a Worthwhile Investment

After the 2008 economic crisis, property markets experienced spates of volatility. Purchasing a home has its advantages and affords the owner more flexibility and security than a rental. With this in mind, it’s important to understand that the obligation of the repayment will still continue in the event of an owner’s death. The debt will form part of the estate, and if the remaining spouse is unable to meet the obligations of the loan, they may lose their home. Furthermore, property happens to be an asset in the estate as well, which provides a legacy for the heirs.

Creating a Legacy

Apart from the inherent risks that debt poses for senior citizens, there is also the desire to leave a legacy for their children. Those who are unable to provide a legacy for their children with their assets have the option to take out certain life insurance policies to cover this wish.

Furthermore, investments and assets often form part of the estate, whereas insurances have the option to pay out to the beneficiary directly. This reduces the liability on the estate, which provides heirs with a tax-free inheritance. That discussion with a financial adviser can be the difference between a healthy or insolvent estate.

Jess Walter  is a freelance writer and mother. She loves the freedom that comes with freelance life and the additional time it means she gets to spend with her family and pets.

INCOME PROPERTY EXPO IN PASADENA HOSTS HOWARD JARVIS TAXPAYERS AND REAL ESTATE EXPERTS TUESDAY, MARCH 14TH

Written by Apartment Management Magazine on . Posted in Blog

IPMExpo_Blue Stacked LogoINCOME PROPERTY EXPO IN PASADENA HOSTS HOWARD JARVIS TAXPAYERS AND REAL ESTATE EXPERTS TUESDAY, MARCH 14TH  

Surviving California’s Hostile Business Environment, The Soft Story Ordinance,
Property Taxes, Legal Issues & Other Seminars – Admission is Free

ExpoPhotos_PressReleasePASADENA (March 3) — Commercial and residential property owners, managers and investors can learn what’s new in financing, strategies and products at the 5th Annual Income Property Expo at Pasadena Convention Center, 300 E. Green Street, Pasadena, CA 91101 on March 14, from 9:00 a.m. to 4:00 p.m. Admission is free.

“This event offers experts, resources and strategies for cost-effective management and maintenance of rental, multifamily and commercial properties,” said Paul Smith, producer. Howard Jarvis Taxpayers Assoc. president Jon Coupal will discuss surviving the hostile business environment, plus experts seminars on the seismic retrofit ordinance, market analysis, rent control, landlord/tenant and property law and more will be held including:

  • Kathy Fettke, Real Wealth Network
  • Jon Coupal, Howard Jarvis Taxpayers Association
  • Dilip Khatri, PhD, P.E., S.E., Khatri International Structural & Civil Engineers
  • Robert “Rusty” Tweed, Tweed Financial Services
  • Tony Watson, Robert Hall & Associates
  • Elizabeth Harris, Exeter 1031 Exchange Services, LLC
  • Dennis P. Block, Law Firm of Dennis P. Block & Associates
  • Gene Guarino, Residential Assisted Living Academy
  • Steven Duringer, Duringer Law Firm
  • Brian Gordon & Vince Medina, Lotus Property Services, Inc.
  • Mike Brennan, Brennan Law Firm

Nearly 100 vendors will showcase the latest in building products, services, materials, energy systems and maintenance. The expo also features all-day networking with industry professionals and sponsors including Apartment Management Magazine, Real Wealth Network, Chase Bank, Robert Hall & Associates, Exeter 1031 Exchange, Duringer Law Group, Tweed Financial Services, Khatri Structural and Civil Engineers, Provident Bank, HD Supply, CIC Tenant Screening, and The Howard Jarvis Taxpayers Association.

Admission is free. Seminar seating is limited. For information, please contact Jordan Smith at (800) 931-6666
or email RSVP@IPMEXPO.com. Pre-register at www.incomepropertyexpo.com.