OC Housing Connection

What is the Federal Reserve's NATURAL RATE?

So, all things being equal, what is the Federal Reserve's "natural rate"? The ideal rate that creates the so-called "three bears economy"...not too hot, not too cold.  Used to be around 5%, but many seem to think it's more around 2-3% today. Why does this matter?  Because it tells a lot whether the Fed wants to raise rates or lower them (long term) and where we might be headed with our home and consumer loans in the near term.  Our hosts Hamid and Fay Hamadanchy then dive into some more "macro economic trends" that factor into those Fed decisions (mainly  the jobs report and "consumer demand") and how perplexed they are that job growth has been slowly but steadily growing since "The Great Recession" (except for THIS week's poor performance) while consumer demand remains stubbornly weak. What's going on? Find out in this week's fascinating look at housing prices and loan rates as they try and peer into the Fed's crystal ball and see where we headed this year.  Only on Orange County's only community radio station, www.OCTalkRadio.net.

Buying a Home with Funds From Your 401K

This week's wide ranging discussion starts off with our weekly look at what the Fed is or isn't going to do with interest rates right now (a topic on everyone's mind) and moves into a deeper discussion about how the Fed is really just there to control American Consumer Demand.  That means it does not really factor in world economies and whatever demand there might be for our products overseas, especially with our dollar being so low relative to other currencies. So are they missing key elements when it comes to deciding whether to pump the economy or slow it down thru their control of the Federal lending rate...the so-called "discount rate" the Federal Reserve charges commercial banks and other depository institutions on loans they receive from their regional Federal Reserve Bank.  You decide.  Then listen to the last part where our hosts Hamid and Fay Hamadanchy discuss using funds from your 401K to purchase your next fund.  You won't want to miss this one! Only on Orange County's only community radio station, www.OCTalkRadio.net.

Does the Fed NEED to raise rates?

Does the Federal Reserve actually WANT to raise rates regardless of whether they NEED to right now? Is it more than just holding off inflation?  Or do they see some larger crisis looming over the horizon which they feel REQUIRES them to raise rates (regardless of its short term effects on the election or the economy) so they can cut them back again in response to some unforeseen stock market correction, China meltdown or Eurozone explosion? That's the question our hosts Hamid and Fay Hamadanchy debate today (along with yours truly, the "everyman" on the show).  For if (as some speculate) there is surely a stock market correction coming or some Euro/China storm just over the horizon, then what could the Fed do if rates are already at or near zero?  Go into negative territory as some banks in Europe have already done? And how would banks continue to make money if interest rates were BELOW zero? It's a fascinating look at "macro-economics" today on our OC HOUSING CONNECTION show as we argue over not just IF or WHEN the Feds will raise rates but do they feel COMPELLED to do so (regardless of the short term effect on the economy or election) to give them ammunition for some future economic crisis?  You'll want to hear this one!

The Economic Effects of Our Election

Don't miss this wide ranging discussion about the possible economic impacts of our upcoming national election. How will the stock markets react (or will they?)  What could massive deportation or immigration bans mean for our economy?  And why isn't Wall Street more nervous about the political revolt happening on Main Street America?

Our host, Hamid Hamadanchy touches on all those topics, along with several more like potential "negative interest rates".  What are they?  How do they work?  And will this uniquely European phenomenon ever find its way to our shore?  Or what about the steady influx of influential Chinese investments here in Orange County and the continual flood of Chinese money coming into our county.  How it helps prop up an already overheated housing market, with Chinese buyers buying anything and everything in sight for all cash.  And how long will it continue?

You won't want to miss this wide ranging view of the some macro economic trends and their impact on our own long term housing market.  Only on Orange County's only community radio station, www.OCTalkRadio.net.

When is The Best Time to Sell Your Home?

After we take our usual quick look at the real estate market and the macro trends affecting it (like lower job reports and worries out of China), our hosts Hamid and Fay Hamidanchy explore when the best times to sell your home nationwide and here in Orange County.  And the results may surprise you.  They also end this week's installment of this week's OC HOUSING CONNECTION with a quick review of "alternative ways to establish credit", particularly for those aging baby boomer (like me) who've paid off their houses and/or ripped up their credit cards and restrained themselves from buying anything big...leaving them with suddenly little or no credit history in this last chapter of their life.  Learn why too much frugalness may work against you and how to work around it if you still want to buy another home someday on credit (and invest the cash from your existing home for needed cash flow after you retire).  Fascinating ideas from Orange County's only community radio station, www.OCTalkRadio.net.

Adjustable Rate Mortgages (ARMS) are still around

In a world of low, fixed rate mortgages, you wouldn't think the old adjustable rate mortgages (ARMS) so popular in the 90s would still be around.  But you'd be wrong!  Today our hosts Hamid and Fay Hamidanchy discuss their past experience with these popular products, how, why and where they can still be found and who might benefit from using one.  For example, most of us refinanced our homes somewhere before or after the "Great Recession" to take advantage of incredibly low, fixed rate loans.  We did this to take the risk out of potential rises in our loan costs (particularly those of us that had risky "high cap" loans that could soar someday into double digits).  But did we actually come out ahead?  We removed the risk but may (in fact) may have paid MORE over the last few years for these fixed rate loans, particularly since the indexes on which they were based (like LIBOR) also remained so low. ARM yourself with some amazing facts about adjustable rate mortgages on this week's installment of OC HOUSING CONNECTION and see how you fared here on Orange County's only community radio station, www.OCTalkRadio.net.

Milleninials and Boomers: 2 Halves of the Same Housing Problem

To a certain degree, Millennials and their Baby Boomer parents are two halves of the same housing problem which includes high prices, short supplies and few first time homebuyers. For 20 somethings, it's all about getting them INTO a home.  And for Boomers, it's all about getting them to move OUT of their home, or at least get the equity out of their homes (particularly when they need the money to supplement their sparse social security income).  So today, our host Hamid Hamidanchy spends this week's show examining each half of this interrelated housing problem.

Millennials are certainly deferring "family formation" much later than previous generations.  And when they do finally start having children, will they still want the American dream of their own home w/a backyard for their kids and safe suburban neighborhoods to play in?  For now, it's anyone's guess.  That's because they are NOT buying homes or even showing any interest in the process.  Instead, they seem to prefer renting in more urbanized areas with close proximity to shopping, entertainment and work.  

Some say it's because they can't afford to buy with the amount of student debt they carry and the unaffordably high prices of homes near the hi-tech, hi growth coastal communities where all the jobs are being spawned.  So will OC become like SF and NY where high paid young workers abandon the idea of home ownership  altogether and rent their whole lives instead?  Or will they be forced to commute or move to new job growth centers in less exciting inland areas? For now, they're flocking to urbanized areas and seem apathetic to having kids, cars or homes (given what their parents went thru in the Great Recession).  For Millennials, it's all about their lifestyle and the heck with equity and home ownership.

Boomers, on the other hand fought hard to buy their homes and they seem more determined than ever to stay put for as long as possible.  Partly, this is due to lower tax rates locked in before their homes doubled or tripled in price.  But mainly it's because they plan to stay, work and live longer than any generation in history and that means they are NOT ready to quit and move to some retirement community to live out their lives playing golf like their parents did.  Like their children, they are deferring moving to the next stage of life and this means fewer homes opening up on the market for their children to buy. And a tighter market means a higher priced market, which also acts to keep Millennials from moving in.

So what are the boomers to do?  Particularly when they stop working?  If the studies are right, they will have far less money saved than they'll need if they live to be 100 and far fewer pensions to count on as well.  So maybe they'll stay in their homes and draw from the substantial equity they've acquired as housing has hit all time highs thru FHA approved programs like REVERSE MORTGAGES.  Discover the rules put in place by the FHA to protect borrowers of these unusual new products  including age limits (62) and the amount of equity you can tap (up to $625,000)  And discover how these may be the answer for both ends of the spectrum...a way to keep Baby Boomers in their homes thru the end of their life and still leave a home and some equity to their children when they finally start their delayed family formation.  Only on Orange County's only community radio station, www.OCTalkRadio.net.

Understanding VA loans for Military Veterans

Even those who've served in the military don't always understand the great loans available to buy their home thru the Veteran's Administration.  Who qualifies?  What are the advantages and benefits?  And does it take any extra time to process? All these questions and more are answered this week by our hosts, Hamid and Fay Hamadanchy as they look at one of the least understood Federally guaranteed loan programs available to all our veterans on this week's installment of the OC HOUSING CONNECTION, right here on Orange County's only community radio station, www.OCTalkRadio.net.

Let's look deeper at The Fed 03-28-16

This week, we take a deep look at The Fed including it's history, structure and purpose. Who owns the Fed?  What's is it's relationship to the 12 Federal Reserve Banks and what do they do?  And (most importantly) what powers does the Fed have to increase or decrease money supply and affect the overall Monetary Policy of the United States.  Join our hosts Hamid and Fay Hamadanchy as they pick up from last week and dive deeper into this mysterious, quasi-governmental body (after first reviewing this week's economic indicators and likely Fed action).  Only on the OC HOUSING CONNECTION here on Orange County's only community radio station, www.OCTalkRadio.net.

The Fed and Higher Home Prices

For the first half of our program today, our hosts, Hamid and Fay Hamadanchy, explore the inner workings of the Federal Reserve (known to most of us as just "the Fed").  What comes out of this lively discussion is just how little most of really know about this mysterious entity despite it's crucial connection to our economy and housing markets.

Do you know how many Federal Reserve banks there are in this country?  Where they are located and who runs the one in your area?  Or how they control inflation and affect our housing prices?

From there we talk about the OC Housing market as it continues to head towards record heights and how this may be the norm for some time to come, regardless of what happens in other parts of the country.  Will we become one big "Leisure World" with a largely older population of graying seniors unable to move up (as higher end homes move further out of reach) and unwilling to move out to traditional retirement communities (as their parents did)?  And will this further exacerbate the already chronic shortage of inventory in this already tight housing market?

And what about the so-called "millennials"...the children of those same aging baby boomers who can't even afford to buy a home in the same communities in which they were raised.  Will they continue their exodus out of Orange County?  Or accept being renters for the rest of their lives, like their contemporaries in San Francisco and New York? Will they give up the American dream of owning your own home?  Or will they settle for small spaces in higher priced, high rise spaces?  

Stay tuned as the changing face of Orange County's housing continues to unfold on your OC HOUSING CONNECTION, here on Orange County's only community radio station, www.OCTalkRadio.net.