Top Ten Signs of an Asian Household

Take these with a grain of salt and a sense of humor. I have to admit, though, that there is some truth to these observations. These apply to my family's house and the homes of most of my Asian friends. You just know walking into a house that it could be owned by an Asian if:

1. In the foyer, there’s an altar to the ancestors. It’s typically red-stained woods with red blinking lights.
2. Open the dishwasher and it’s full of mismatched Tupperware.
3. The backyard is mostly concrete.
4. There’s a gas range outside for cooking.
5. Large winter melons grow in the backyard.
6. The garage can double as a supermarket. Stockpiling is an art.
7. All the walls are white, white, white.
8. The bathroom seems remodeled, but in different styles and shades of tile.
9. Pairs of shoes line the entrance to the house.
10. The property has a gate, fence or some other impediment blocking direct access to the house.

Window Shopping

My best friend and I went window shopping for houses today, visiting several open houses and model homes. We learned a couple of things: new houses show a lot better and are more affordable than a year ago, pictures can't accurately represent a house online and we should definitely wait to make a purchase. The new homes we looked at included Sheldon Farms, Laguna Point Condos and Laguna Oaks condo conversions. Sheldon Farms was the most attractive with nicely laid out one-story plans in the $350,000 range. Still out of the price range of a single girl with a modest income, but still more affordable than a year ago when the same house would have fetched maybe 20K more.

The condos were a cheaper alternative. The two bedroom condo floor plan at Laguna Point had huge rooms and an added walk-in closet for each room, a nice touch. The front door, however, opened directly into a steep staircase up to the second floor. Instinctively, it didn't feel welcoming and was definitely a no-no in feng shui. I don't know many Asians who would buy a home with that layout. The other floor plans at Laguna Point had cramped bedrooms that felt claustrophobic. Laguna Oaks condos were nicely renovated from apartments into condos in the low 220K range. Definitely affordable, but with 216 units to be sold, we didn't feel the rush to purchase one. The salesperson said that the low price was only for the initial offering and may rise as time goes by. I doubt it and will check back in a year to see if it pans out that way.

The open houses we toured were in the Pocket area: three halfplexes and a house. The interesting point is that a halfplex that didn't look that inviting turned out to be our favorite while another halfplex that looked wonderful online was disappointing. It just honed in the fact that one needs to feel the physicality of a space to get a proper sense of whether it's a contender.

Oh, and one more thing we learned. If you want to have a successful open house, don't perfume your house with an overpowering scent. The last open house we visited had an strong odor, a scent candle or something, that practically drove us out at the door.

A Kiwi Perspective on Housing

I chatted over IM with my friend in New Zealand yesterday about housing and gained an international perspective on the housing boom (and bust at least in the U.S.) In Auckland, the price of houses jumped 16% in a year, indicative of a dramatic upward trend for the last five years. The pressure my friend feels to buy in now before the prices rise too much out of her economic reach is eerily reminiscent of the atmosphere in California before the subprime meltdown. The average price of a Kiwi house in June was $557,546 versus the median household income of approximately $51,094, numbers that look positively Los Angelean. This article points out the rapid rise in housing is hardly contained within the U.S and may be closely tied to what happens over here in our neck of the world.

The rise in prices is worrisome because the international housing boom is a byproduct of globalization. The economic links act as a self-reinforcing network that has fueled the global surge in house prices but would also be likely to magnify the pain on the way down. The ripples would extend well beyond the housing markets. A fall in American house prices, for example, would crimp consumer spending - and free-spending Americans have supported growth in many export-minded nations. If house prices drop and American consumers are forced to tighten their belts, buying fewer imports, China and other nations would have to slow their dollar investments, driving interest rates higher and higher. That could hurt housing markets from Paris to Shanghai to Auckland.

Interest Rates to Hold Steady

So, the lazy days of summer have arrived along with the perpensity for vegetation, the human kind. Even as my fevered tracking of the housing market has waned, I'm still keeping an eye on interest and mortgage rates. Merrill Lynch & Co. and Goldman, Sachs & Co. recently announced that they don't expect the Federal Reserve to cut interest rates meaning that the healthy yeilds for money market funds would hold steady at 5.25%. At the same time, however, mortgage rates will likely rise. The average rate on 30-year conventional mortgages nationwide was at a nine-month high of 6.42% last week, up from 6.37% the previous week, according to mortgage finance giant Freddie Mac. I never thought I'd be interested in these types of figures. However, this news has a direct impact on little ole' me. One, I've parked my house down payment savings in a high yield CDs earning more interest than those accounts historically have offered. Second, the higher mortgage rates affect the monthly budget that I can work. Good thing the housing units for the area I'm interested in has begun to fall. Just this week, a house in the Greenhaven area listed for $171.77 per sq foot, the lowest I've seen yet. There is hope, afterall.

The Human Face of Foreclosure

My glee in watching the housing market implode is tempered by stories like this that illustrate the personal costs of subprime lending. Not just investors or even new home buyers are caught in the foreclosure net, but people who have owned their homes for years are also at risk. They have my empathy though I will stop short of advocating government bailout. In the end, responsiblity for debt lies firmly in the person who made the choice to sign their name on the loan forms, regardless of circumstances.

For decades, the 5100 block of West Outer Drive in Detroit has been a model of middle-class home ownership, part of an urban enclave of well-kept Colonial residences and manicured lawns. But on a recent spring day, locals saw something disturbing: dandelions growing wild on several properties.
"When I see dandelions, I worry," says Sylvia Hollifield, an instructor at Michigan State University who has lived on the block for more than 20 years.

Ms. Hollifield's concern is well-founded. Her neighbors are losing interest in their lawns because they're losing their homes -- a result of the recent boom in "subprime" mortgage lending. Over the past several years, seven of the 26 households on the 5100 block have taken out subprime loans, typically aimed at folks with poor or patchy credit.

Buyers a Rare Breed

The Sacramento Bee profiles three buyers who are a rare breed in the softening housing market. Everyday that I see more houses in my price range become available is another day I will wait to buy.

Now that it's done, Joi Bess couldn't be happier about selling her Rancho Cordova house and buying a bigger one in Folsom.She closed escrow in April on the first anniversary of a new marriage and blended family of eight. "It worked, and we're reaping the benefits already in a fantastic house and fantastic area," she says.

In what's proving to be a second straight year of slowed sales and falling prices in many neighborhoods, that closing makes Bess a hero to the Sacramento region's real estate trade. She is a buyer.

All-Time High Prices

Prices are at an all-time high....not for housing, anyway but aluminum cans. Just read this interesting article in the LA Times about the rising value of recycled materials. On Jan. 1, the California redemption value for a 12-ounce bottle or can went up from 4 cents to 5 cents with the average price for a pound for aluminum at $1.55, an all-time high. Whether the amount paid for cans is a pittance or an income stream depends on your perspective.

When I was 10 or 11, it certainly was a great way to get pocket change for snacks. Money was tight and us kids didn’t get allowances. I remember scavenging the flea market garbage cans on the weekends while my parents worked their stall. My dad even made a special pole with the hook at the end so I could really dig in. It’s not exactly a fond memory. The days were really hot, the garbage smelly and the cans sticky and hard to flatten beneath our child sized sneakers. I would have been embarrassed to be seen by any of my classmates or friends. One indelible image that pops up is that of me and my sister, aged ten and five, both with poles and garbage bags in hand standing next to my mother, who had taken a break to find us and was holding my baby sister, a toddler on her hip. A white man with a soda saw us and deliberately made a beeline for us, sidestepping several garbage bins, and placed the can directly in my bag. I wonder if what he saw was a brown family on the edge of poverty. Looking back, I wonder about my parents’ decision to let their ten and five year-old daughters roam around scavenging cans on their own but longer feel shame or embarrassment. It is these long-forgotten memories involving my earliest experiences in how hard it is to earn money that influence how I view money today. My youngest sister who luckily grew up as our family prospered, I feel, has a much more careless attitude toward money. ($100 for a two piece swim suit!!!) She’s has decidedly middle-class tastes while my low-income inner-self consciousness has become more prominent since the home-buying obsession started. I used to roll my eyes when my mother marched into the grocery store to demand a 30 cent price difference after discovering an error on the receipt. Now, I’m right there along with her demanding the same thing.