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ISSUE # 89
CIC Info Bytes 04/25/24
CIC Info Bytes are frequent, succinct updates providing educational and engagement opportunities that help your community thrive! Please forward and share this newsletter with your peers, neighbors and colleagues so they can connect and join. Our goal is to curate content that provides a robust basis for contextual understanding to support practical takeaways for you and your association. Please consider following us on Twitter and Reddit.
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EVENTS
Visit our homepage to view events and add them to your own calendar.
A new, non-industry survey reinforces the truth: a majority of homeowners are not keen about their community association. View this and more on our Statistics page. Races for President, Governor Are Tightening in North Carolina — Barbara Holland | The Carolina Journal | April 11, 2024
🎗️ WHY We Produce this Newsletter
🎗️ WHY We Produce this Newsletter
We have written about the ‘WHY’ before. The article below considers horticulture resources AND reflects some of the primary factors contributing to this newsletter:
Commitment to publishing ensures due diligence to survey the landscape of community association information. Become an expert: be a sponge!
Curious homeowners, volunteer leaders and professionals. You’re curious, right?
…Creating the newsletter, he said, is one of his “forcing functions” — a term perhaps more familiar to those who work in math or science, meaning a “systems way of thinking where a choice that you’ve made then forces something else to occur.”
His commitment to publishing the newsletter weekly, he figured, would ensure that he diligently surveyed the landscape of horticultural information — research reports, magazines, websites, social media and other newsletters — to find his own selections to recommend.
Another catalyst for combing through the current literature: his curious students…
Where Do the Gardeners You Admire Turn for Advice? To These Newsletters.
THE DEFINITIVE GUIDE: is it a reserve expense? View more on our Reserves page.
1. The expense is for inspection / review, maintenance, repair or replacement of one or more components that already exist AND are substantially the same. Capital improvements are NOT reserve expenses.
2. The expense does not occur annually, but is expected to occur at least once or more within the expected useful life of the property as a whole.
Annually recurring expenses are NOT reserve expenses (they are always operating expenses).
N.B. The expense does not have to be "predictable." For example, generators and common piping are often omitted from reserve studies. The fact that there is a lack of consensus about when or if these items will reliably require inspection, maintenance, repair and/or replacement does not obviate them from being included in a reserve study. Failure to include common piping has resulted in many multi-million dollar special assessments.
N.B. The expense does not have to be "significant" or more than 1% of your annual operating budget. "Significant" and "material" and other such words are meaningless as they are not defined by statute, nor your governing documents. Quarrels have been had over less. 20 items that are 0.5% of your operating budget add up to 10%. 10x $3,000 items = $30,000. Oh, and is that 1% in current dollar terms or inflated 20 years from now? Oh and what if your estimate of the replacement cost is off by 1,000%? Don't be fooled by excluding components you'll have difficulty tracking over time! Put every expense that does not occur annually in your reserve study. This is the ONLY way to ensure: 1) tracking and 2) equity of reserving for costs over time.
3. The expense is some form of common expense.
Common expenses are defined by statute and your declaration / CC&Rs and generally benefit more than one unit.
Trials and Tribulations of a Volunteer Director - Part XIV
Trials and Tribulations of a Volunteer Director - Part XIV
PART XIV: Plain Language
There are numerous examples of the benefits of plain language. Please do not confuse plain language for brevity! Plain language should be precise and can be lengthy, but is always superior to ambiguity and omissions. Want to improve your community association governance and operations? Add more plain language!
Governing documents: declaration, bylaws, policies and procedures, rules and regulations, committee charters and more!
Ambiguous, convoluted, and/or sparse? You can amend and restate your governing documents and restatements should use plain language
Pritchett v. Picnic Point Homeowners Association ¶ 18 In determining the intent of the parties to the agreement incorporating the covenants, we give “covenant language ‘its ordinary and common use’ and will not construe a term in such a way ‘so as to defeat its plain and obvious meaning.’ ” Wilkinson v. Chiwawa Cmtys. Ass'n, 180 Wn.2d 241, 250, 327 P.3d 614 (2014) (quoting Mains Farm Homeowners Ass'n v. Worthington, 121 Wn.2d 810, 816, 854 P.2d 1072 (1993); Riss, 131 Wn.2d at 623). We examine the instrument in its entirety and use extrinsic evidence to “ ‘illuminate what was written, not what was intended to be written.’ ” Wilkinson, 180 Wn.2d at 250–51 (quoting Hollis v. Garwall, Inc., 137 Wn.2d 683, 697, 974 P.2d 836 (1999) ).
Pritchett v. Picnic Point Homeowners Association ¶ 18 In determining the intent of the parties to the agreement incorporating the covenants, we give “covenant language ‘its ordinary and common use’ and will not construe a term in such a way ‘so as to defeat its plain and obvious meaning.’ ” Wilkinson v. Chiwawa Cmtys. Ass'n, 180 Wn.2d 241, 250, 327 P.3d 614 (2014) (quoting Mains Farm Homeowners Ass'n v. Worthington, 121 Wn.2d 810, 816, 854 P.2d 1072 (1993); Riss, 131 Wn.2d at 623). We examine the instrument in its entirety and use extrinsic evidence to “ ‘illuminate what was written, not what was intended to be written.’ ” Wilkinson, 180 Wn.2d at 250–51 (quoting Hollis v. Garwall, Inc., 137 Wn.2d 683, 697, 974 P.2d 836 (1999) ).
Rage against the remote meeting? Many states have adopted explicit updates to nonprofit corporation and community association statutes to allow remote and hybrid meeting formats.
It’s time to for HOAs to ditch Zoom meetings — Barbara Holland | Las Vegas Review-Journal | April 15, 2024
…Nick Mastroianni has lived in the Greenbriar private community in Somers for 33 years. "I raised my kids back here, playing ball. You know, for many years we had a lot of fun back here," he said. "I wouldn't be able to do that now with my grandson."
A massive sinkhole is behind his backyard - and it's been there for a long time.
"Ten years ago, we saw a sinkhole was developing so we notified the homeowners association. They told me there's no imminent danger here, and I said 'Well, let your grandchildren come play back here,"' he says….
VIDEO: Somers community says HOA refuses to fix massive sinkhole — Emily Young | News12 Long Island | March 27, 2024
Miami, Florida: Following closely on the heels of Florida’s landmark passage of HB1021, Miami, with its incredible concentration of condos, may acquire its own ombudsman.
A call to find city funds to hire a condominium ombudsperson has been referred to Miami Beach’s Finance and Economic Resiliency Committee.
“In order to properly implement the Condominium Assistance Charter Amendment,” the resolution that city commissioners referred says, “the city should create a position for a professional with relevant experience assisting condominium and/or co-op owners in navigating city processes and working with other governmental agencies to facilitate the resolution of condominium-related issues.”...
Miami Beach looks to hire a condo ombudsman — Janetssy Lugo | Miami Today News | March 26, 2024
The Board is in charge, but homeowners (yes, board members ARE homeowners and not aliens from Mars) most certainly need to know their limits. Professionals can help, but that does not mean that you should “trust the CAM” above all else because experience tells us that many (most?) community managers are ill-equipped and under-resourced to ensure the success of the communities and homeowners they’re hired to help. Board sustainability is key and the volunteer model is fraught with challenges including conflict that arises out of the belief that what works well for other sectors / business verticals also works well for community associations. More often than not
…Collective home ownership promised residents a democratic and participatory decision-making process that also ensured the effective maintenance and upkeep of shared spaces and facilities. What went wrong?...
Teachers, artists, attorneys, physicians, bankers, accountants, you-name-its are ill-equipped to serve on an aging home’s homeowner association. Intelligent, well-meaning people without the understanding of how to care for an elderly multistory building make poor board directors. They lack the objectivity gained through architecture or professional engineering schools. They are without hands-on industry knowledge. With no building science mastery of their own, they’re forced to rely on consultant expert opinions. In my experience, they often misunderstand what they’re told, or (worse) don’t want to hear what they don’t want to know.
[Many individuals are ill-equipped to serve as volunteer board members. Architects and engineers are not necessarily more qualified than accountants, artists, bankers or owners of any other profession.]
Intuition is no substitute for experience [facts and knowledge]. Layperson condo boards are susceptible to the siren call of optimism bias. It’s comforting to believe bad things don’t happen to good buildings, a point of view that may have kept Champlain’s board from making timely repairs in time. The converse, pessimism bias, may have also played a role in the Surfside disaster. Overestimating potential downsides of the repair plan could have cast a pall of hopelessness. Either bias can lead to inaction.
Co-owner self-governance was supposed to minimize bias-based decision-making. With three, five, or seven reasonable people sitting around a boardroom table, collective wisdom would prevail. That was the theory, anyway. History proves multiple heads are not necessarily better than one…
Condocide: Death of a Building Type — Richard Buday | Common Edge | May 15, 2023
The following book was published by CAI’s publishing arm back in 2001 and Amazon has used copies for sale via third party and you might be able to find a copy via interlibrary loan and/or purchase online at Biblio.
Decision Making in Communities: Why Groups of Smart People Sometimes Make Bad Decisions — Jasmine Martirossian | 2001
What do all associations have in common?
There’s a Board typically composed of owners.
Members (owners) are required to pay assessments.
What do all assessments have in common? The potential for embezzlement and fraud. You’ll find an array of coverage about this on Condo Connection: just search the omnibox in the upper right corner.
…The 25-minute conversation was a decade in the making — and had multimillion-dollar implications. For years, residents of the massive Ocean Towers luxury co-op complex in Santa Monica had worried that Omar’s father, John, was abusing the power he held as a member of the buildings’ homeowners association board.
Several residents filed lawsuits accusing the elder Spahi of a wide array of misconduct, including: manipulating board elections,draining the HOA’s accounts to fund personal legal battles, inside dealing of valuable real estate, and driving the complex further into debt by pushing the HOA to take out bank loans without shareholder approval.
Residents didn’t grasp the scale of the alleged problems until last year — when a Los Angeles County grand jury handed down a 119-count indictment accusing both Spahis, now-former Ocean Towers Housing Corp. President Joseph Orlando and his wife, Dorothy, of grand theft, identity theft and money laundering…
Santa Monica luxury towers, HOA fees, alleged theft: Where did the millions go? — James Queally and Andrew Khouri | LA Times | April 11, 2024
Falls Church, Virginia (home of CAI and FCAR and CAMICB): Hiring an attorney is one way to go. Another is campaigning to serve on the Board. Any path you take is superior to inaction. Apathy is the worst choice.
Joseph Schiarizzi started his rebellion by planting heirloom tomatoes...
… Schiarizzi hired a lawyer. He estimates he has spent 100 hours of his time and $3,000 on legal advice, to keep gardening. For now, he’s ignoring the notices on the advice of his lawyer.
“Most people don’t have the energy to fight back,” he says. “I’m very fortunate that my career and life are very flexible, I have a lot of tenacity and make time for this.” HOA representatives did not respond to multiple inquiries….
HOAs are blocking solar panels and native lawns. Here's how to fight back. — Michael J. Coren | The Washington Post | April 02, 2024
Dawn Bauman sent a missive from her roost at FCAR (managed entirely by CAI) with a scary headline about the FCC banning bulk broadband deals in multifamily housing. There is, in fact, no draft rulemaking or anything more specific than the FCC news release below. The intent of the would-be changes are aimed at apartments where landlords dictate the available options and typically offer broadband services for a profit.
DEAR Dawn Bauman and FCAR,
Please stop publishing incendiary memos. Nobody wants to kill broadband for condos, co-ops and/or HOAs.
Chairwoman Announces Push to Lower Broadband Costs & Increase Choice for Families Living in Apartment Buildings — FCC | March 05, 2024
FCC chairwoman wants apartment dwellers to have broadband choice — Linda Hardesty | Fierce Network | March 06, 2024
My building requires that residents pay for a service from a provider that I don't want. Does this violate FCC rules?
Not necessarily. The FCC does not currently prohibit what are known as bulk billing arrangements. Under such an arrangement, a company agrees to provide service to every tenant of a building, who are then billed a prorated share of the total cost. Under these arrangements, tenants may be billed by either the landlord or the service provider.
FCC rules do prohibit service providers from entering into bulk billing contracts with landlords that grant the service provider the exclusive right to access and serve a building. These types of contracts harm competition by stopping additional providers from serving tenants in a building, and limit consumer choice.
FCC Consumer FAQ: Rules for Service Providers in Multiple Tenant Environments
Improving Competitive Broadband Access to Multiple Tenant Environments — Federal Register | March 28, 2022
Feeding the ducks and pickleball are both hot topics. See Issues # 88, 84, and 81 for more on pickleball. More on ducks in Issue #36 and also our Collections page.
Neighborhood nuisances: Can noisy pickleball courts, duck-feeding residents be stopped? — Ryan Poliakoff | The Palm Beach Post | April 07, 2024
How condos work from the Condominium Authority of Ontario.
Coverage: 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32 and 33
Energy
Energy
A ban by any other name?
Washington Gov. Jay Inslee signed a bill last month to reduce the use of natural gas…
Inslee is not shying away from a potential increased cost to customers, calling any price increases "temporary" as he argues that renewable energy will become more affordable as technology improves…
New Washington state law does not 'ban' natural gas, does discourage use — Sebastian Robertson | KING5 | April 02, 2024
The Cost of Net Zero
The Cost of Net Zero
A variety of factors—from power-hungry data centers to utilities spending to move toward cleaner sources of power—contribute to high electricity bills. And natural gas won’t stay this low forever…
Natural Gas Is Cheap. Why Electricity Isn’t. — Avi Salzman | Barron’s | April 19, 2024
Environment
Environment
More CO2 = a warmer planet.
Carbon dioxide acts like Earth’s thermostat: The more of it in the air, the more the planet warms.
In 2023, global levels of the greenhouse gas rose to 419 parts per million, around 50 percent more than before the Industrial Revolution. That means there are roughly 50 percent more carbon dioxide molecules in the air than there were in 1750…
Carbon Dioxide Levels Have Passed a New Milestone — Aatish Bhatia | The New York Times | April 20, 2024
Thousands of negotiators and observers representing most of the world’s nations are gathering in the Canadian city of Ottawa this week to craft a treaty to stop the rapidly escalating problem of plastic pollution.
Each day, the equivalent of 2,000 garbage trucks full of plastic are dumped into the world’s oceans, rivers and lakes, according to the United Nations Environment Programme. People are increasingly breathing, eating and drinking tiny plastic particles.
Negotiators must streamline the existing treaty draft and decide its scope: whether it will focus on human health and the environment, limit the actual production of plastic, restrict some chemicals used in plastics, or any combination of the above. These are elements that a self-named “high ambition coalition” of countries want to see…
Global talks to tackle plastic pollution hit critical stage — Jennifer McDermott | PBS | April 23, 2024
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Strict PFAS rules for drinking water have been finalized.
The Environmental Protection Agency (EPA) has finalized rules for the amount of certain “forever chemicals” allowed in drinking water. This is the first time the US has placed legally enforceable federal limits on per- and polyfluoroalkyl substances (PFAS), chemicals so ubiquitous that they’ve likely already made their way into most Americans’ bloodstreams…
The US finalizes rules for ‘forever chemicals’ in drinking water — Justine Calma | The Verge | April 10, 2024
Biden-Harris Administration Finalizes First-Ever National Drinking Water Standard to Protect 100M People from PFAS Pollution — EPA | April 10, 2024
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Ocean waves crashing on the world’s shores emit more PFAS into the air than the world’s industrial polluters, new research has found, raising concerns about environmental contamination and human exposure along coastlines.
The study measured levels of PFAS released from the bubbles that burst when waves crash, spraying aerosols into the air. It found sea spray levels were hundreds of thousands times higher than levels in the water.
The contaminated spray likely affects groundwater, surface water, vegetation, and agricultural products near coastlines that are far from industrial sources of PFAS, said Ian Cousins, a Stockholm University researcher and the study’s lead author.
Ocean spray emits more PFAS than industrial polluters, study finds — Tom Perkins | The Guardian | April 19, 2024
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80 Percent of Global CO2 Emissions Come From Just 57 Companies, Report Shows — Christian Thorsberg | Smithsonian Magazine | April 09, 2024
Housing Affordability & Homelessness
Housing Affordability & Homelessness
Housing policy is a hotly debated and divided concern.
Last August, Seattle’s Department of Planning and Community Development produced a draft update to the city’s Comprehensive Plan that would have allowed for significantly more density in more parts of the city, including single-family neighborhoods, than the final version Mayor Harrell released in March.
The never-released draft plan, which PubliCola obtained through a records request, would have allowed more density near bus lines, more apartments in areas historically reserved for single-family houses, and more housing of all types in the city’s most exclusive neighborhoods…
Mayor's Office Edited Ambitious Growth Plan for Seattle to Preserve the Status Quo — Erica C. Barnett | PubliCola | April 16, 2024
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Failure to take the city's housing shortage seriously?
“We’ve been here [in committee] for two months now, and we’ve not passed any substantial legislation,” Morales said. “And I get that my colleagues are new, but it’s time to learn the job and do the thing. And, it’s disappointing that what I keep hearing is, I need more time. I don’t understand it. Yeah, so that’s frustrating.”
Seattle Land Use Committee Rejects Morales’ Equitable Development Bill — Doug Trumm | The Urbanist | April 19, 2024
"Despite the fact that everybody’s talking about the need for more affordable housing,” Morales told reporters after the vote, “when it comes down to it, there’s either no understanding of how we actually get there, or no willingness to really take action.”
Seattle proposal to add affordable housing, support nonprofits struggles — Heidi Groover | The Seattle Times | April 19, 2024
Is inflation actually HIGHER than we think?
If the rising price of homeowners insurance were factored into the US Consumer Price Index — a key metric of inflation — it could have added 80 basis points, or about 0.8%, to last year’s CPI increase of 3.4%, according to an analysis from Bloomberg Intelligence.
By not including home insurance, the CPI “ignores climate costs,” writes BI senior analyst Andrew Stevenson in his April 9 note.
Homeowners insurance costs in the US hit roughly $175 billion in 2023, up 21% over the previous year, according to insurance brokerage Policygenius. The increase is in large part due to climate change, which is driving more extreme fires, floods and storms. The US endured a record 28 weather and climate disasters that caused at least $1 billion in damage last year. As insurers incur higher costs, homeowners are facing higher premiums. Inflation itself is also making it more expensive to pay out claims…
A Key US Inflation Metric Doesn’t Count Homeowners Insurance — Zahra Hirji | Bloomberg | April 09, 2024
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The home insurance market is crumbling in New Orleans, leaving Alfredo Herrera with few options for coverage — and skyrocketing insurance premiums.
Herrera, 35, works in finance for a local bank. He bought his 900-square-foot home in New Orleans’ Mid-City neighborhood in 2020 for $270,000, and lives there with his partner.
In 2022, he paid $1,600 a year for home insurance. But last July, his insurer canceled his coverage, saying it was leaving Louisiana….
Herrera shopped around for a new plan, but he struggled to find a policy. Louisiana Citizens, the insurer of last resort for property owners in the state, was out of the question. It would have cost more than $7,000 annually.
Herrera eventually found a policy with a small company in the state that charged him $4,930 annually — a 208% increase from what he paid in 2022…
The home insurance market is crumbling. These owners are paying the price — Nathaniel Meyersohn and Anna Bahney | CNN | March 29, 2024
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Cindy Picos was dropped by her home insurer last month. The reason: aerial photos of her roof, which her insurer refused to let her see.
“I thought they had the wrong house,” said Picos, who lives in northern California. “Our roof is in fine shape.”
Her insurer said its images showed her roof had “lived its life expectancy.” Picos paid for an independent inspection that found the roof had another 10 years of life. Her insurer declined to reconsider its decision…
Insurers Are Spying on Your Home From the Sky — Jean Eaglesham | WSJ | April 06, 2024
Is the property insurance crisis nearing its end?
Home insurance rates in Florida far outpaced inflation over the 18 months that ended on Dec. 31, but the rate of increase slowed in the fourth quarter of 2023 to its lowest point of the period.
And many insurance insiders are optimistic that rates will continue to stabilize this year and next, barring a big costly you-know-what…
Home insurance cost hikes slowed at the end of 2023… — Ron Hurtibise | South Florida Sun Sentinel | April 08, 2024
Housing Market
Housing Market
Title insurance no more? Also see Issue# 87.
A top US consumer watchdog is considering whether to bar mortgage bankers from charging homebuyers for title insurance that protects the lenders, ending a long-standing industry practice.
The Consumer Financial Protection Bureau’s plan is still in the early stages, according to people familiar with the matter. The agency will begin to lay the groundwork for the measure in a broad request for information on closing costs, including title insurance and other fees, that will be released as soon as this month, they said. Any final proposal on closing costs, including title insurance, would not come until 2025, one of the people said.
US Weighs Ban on Charging Homebuyers for Lender Title Insurance — Austin Weinstein and Katanga Johnson | Bloomberg | April 10, 2024
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NAR settlement receives preliminary approval.
A settlement that will rewrite the way many real estate agents are paid in the United States has received preliminary approval from a federal judge….
The agreement is still subject to a hearing for final court approval, which is expected to be held on Nov. 22. But that hearing is largely a formality, and Judge Bough’s action in U.S. District Court for the Western District of Missouri now paves the way for N.A.R. to begin implementing the sweeping rule changes required by the deal. The changes will likely go into full effect among brokerages across the country by Sept. 16.
N.A.R., in a statement from spokesman Mantill Williams, welcomed the settlement’s preliminary approval.
“It has always been N.A.R.’s goal to resolve this litigation in a way that preserves consumer choice and protects our members to the greatest extent possible,” he said in an email. “There are strong grounds for the court to approve this settlement because it is in the best interests of all parties and class members.”
Judge Approves $418 Million Settlement That Will Change Real Estate Commissions — Debra Kamin | The New York Times | April 23, 2024
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Sea change? Not so fast! Will real estate sales commissions actually plummet?
…Now we’re being told that the latest, greatest court case truly spells the end of the standard realtor commission. This kind of naïve reporting perpetuates the fiction that the 6% commission is an official rate.
Instead, it’s something far more powerful and persistent: a deeply-held custom nurtured for close to a one hundred years among the members of the nation’s largest trade association. Good luck getting rid of it…
Sorry, Home Sellers: The 6% Commission Isn't Going Anywhere — Stephen Mihm | Bloomberg Opinion | April 10, 2024
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Something deeply unusual has happened in the American housing market over the last two years, as mortgage rates have risen to around 7 percent.
Rates that high are not, by themselves, historically remarkable. The trouble is that the average American household with a mortgage is sitting on a fixed rate that’s a whopping three points lower…
A Huge Number of Homeowners Have Mortgage Rates Too Good to Give Up — Emily Badger and Francesca Paris | The New York Times | April 15, 2024
Built Environment
Built Environment
Condominium conversions can create challenges.
“The conversion of rental apartment buildings to condominium tenure has the potential to displace existing residents from their homes, deplete the supply of purpose-built rentals and affordable housing options, impact vacancy rates and average rents, and does not increase the overall supply of housing units,” read Carpenter…
Carpenter said that the conversion of older rental buildings into condominiums can often create issues for not only residents, but condo owners as well. He said that when a condo corporation purchases an older rental building, they are required to do a reserve fund study under the Condominium Act and later find out the building is far older than expected and requires serious repairs.
“They find out that the building was 50-years-old, that the elevators no longer meet the requirement, that the parking garage needs to be replaced and that it’s five or six million dollars, or that the patios and the balconies need to be replaced,” he said. “What happens is, the condo owner buys this condo for three or $400,000 then finds out that the $50 condo fee that was suggested in the original condo plan, is now four or $500 a month, and then they cannot sell their condo for what they paid for it. They’re stuck with it and they have to pay a lot of money to fix it up. And what we find ourselves in, is a shortage of rental units.”
Carpenter said that they aren’t trying to necessarily discourage condo conversion, but that they want to make sure it’s done under the right conditions.
City Council supports condominium conversion policy — Kimberly de Jong | Brant Beacon | April 18, 2024
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Township of Esquimalt in Canada. No do-overs: extra storeys a no-go for approved condo already in construction.
‘There are no do-overs’: No extra storeys for Pacific House condominium — Shannon Moneo| Journal of Commerce | March 11, 2024
Condo Connection's financial coverage is indexed to our Dollar$ and $ense page dedicated to all things CIC finance.
A stern warning from the IMF to the United States. “Something will have to give…”
The International Monetary Fund leveled an unusually direct criticism at US policymakers Tuesday, saying the country’s recent standout performance among advanced economies was in part driven by an unsustainable fiscal policy.
“The exceptional recent performance of the United States is certainly impressive and a major driver of global growth,” the IMF said in its annual World Economic Outlook. “But it reflects strong demand factors as well, including a fiscal stance that is out of line with long-term fiscal sustainability.”
Washington’s overspending, the report said, risks reigniting inflation and undermining long-term fiscal and financial stability around the world by ratcheting up global funding costs.
IMF Steps Up Its Warning to US Over Ballooning Debt — Christopher Condon | Bloomberg | April 16, 2024
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The Congressional Budget Office warned in its latest projections that US federal government debt is on a path from 97% of GDP last year to 116% by 2034 — higher even than in World War II. The actual outlook is likely worse.
From tax revenue to defense spending and interest rates, the CBO forecasts released earlier this year are underpinned by rosy assumptions. Plug in the market’s current view on interest rates, and the debt-to-GDP ratio rises to 123% in 2034. Then assume — as most in Washington do — that ex-President Donald Trump’s tax cuts mainly stay in place, and the burden gets even higher.
With uncertainty about so many of the variables, Bloomberg Economics has run a million simulations to assess the fragility of the debt outlook. In 88% of the simulations, the results show the debt-to-GDP ratio is on an unsustainable path…
US Government Debt Risk: A Million Simulations Show Danger Ahead — Bhargavi Sakthivel, Maeva Cousin, and David Wilcox | Bloomberg | April 01, 2024
Inflation is slowing, but don’t underestimate inertia…
Bloomberg Weekend Reading: The Risky Economics of Global Uncertainty — Victoria Cavaliere and Ian Fisher | Bloomberg | April 20, 2024
“As long as needed.” That’s how long the FOMC will keep interest rates elevated to tame inflation. Don’t trade convenience for yield!
Federal Reserve Chair Jerome Powell signaled policymakers will wait longer than previously anticipated to cut interest rates following a series of surprisingly high inflation readings.
Powell pointed to the lack of additional progress made on inflation after the rapid decline seen at the end of last year, noting it will likely take more time for officials to gain the necessary confidence that price growth is headed toward the Fed’s 2% goal before lower borrowing costs.
Powell Signals High Rates for Longer Due to Persistent Inflation — Craig Torres | Bloomberg | April 16, 2024
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Slowing growth and rising inflation spell trouble.
US economic growth slid to an almost two-year low last quarter while inflation jumped to uncomfortable levels, interrupting a run of strong demand and muted price pressures that had fueled optimism for a soft landing.
Gross domestic product increased at a 1.6% annualized rate, below all economists’ forecasts, the government’s initial estimate showed. The economy’s main growth engine — personal spending — rose at a slower-than-forecast 2.5% pace. A wider trade deficit subtracted the most from growth since 2022.
A closely watched measure of underlying inflation advanced at a greater-than-expected 3.7% clip, the first quarterly acceleration in a year, the Bureau of Economic Analysis report showed Thursday…
US GDP Q1 2024: Economy Slows as Spending Cools Amid Inflation Pickup — Molly Smith | Bloomberg | April 25, 2024
Cuts might not be coming anytime soon…
Treasuries slumped and traders further trimmed their outlook for the pace of Federal Reserve interest-rate cuts, deterred by a US GDP report that highlighted sticky price pressures.
The selloff in US government bonds on Thursday pushed yields across the curve to the highest levels of the year. Traders pared back expectations for the timing of a Fed rate reduction, now fully pricing in the first cut in December.
US Yields Soar as Traders See Fed Delaying First Cut to December — Liz Capo McCormick | Bloomberg | April 25, 2024
Cashing In
Cashing In
Is your community association cashing in on higher for longer or are your funds mired in bank accounts earning next to nothing?
Across JPMorgan Chase & Co.’s broad suite of consumer accounts, one number is just about everywhere: 0.01%.
That’s the interest rate on Chase Sapphire, Chase Premier Plus and Chase Private Client checking accounts, regardless if someone deposits $5 or $500,000. The same is true for Chase savings accounts, according to a fact sheet as of April 12. Those afforded “relationship rates” get a whopping ... 0.02%.
Americans Sick of 0.01% Yields Create New Dilemma on Wall Street — Paige Smith | Bloomberg | April 17, 2024
Seattle, WA: 1521 – an ultra luxury condominium in Downtown – sued Viracon, an architectural glass manufacturer, with claims of a conspiracy and a remedy to replace all of its approximately 7,850 IGUs. Yikes!
Lawsuit Highlights Defective Glass Units in Seattle Condo — Joshua Huff | US Glass Magazine | January 8, 2024
A fair housing lawsuit convinced the HOA to allow a patio, but a resale disclosure stating that furniture cannot be kept on the patio overnight has undermined the ability to sell the home.
VIDEO: Woman suing HOA: association is impacting her ability to sell her home — Amir Massenburg and Jordan Gartner | FOX 19 | April 10, 2024
Patio dispute with homeowners association sparks lawsuit in Virginia — Laurence Hammack | The Roanoke Times | April 2, 2024
Nassau, Bahamas: An appeals court upheld the right of developers to exert control over further development, unsold land, and even beach access.
— Natalie McKenzie | Eyewitness News | April 17, 2024
Please Stop Discriminating
Please Stop Discriminating
Kailua-Kona, Hawaii: HUD case # 23-280. Find more on our Fair Housing page.
— US Department of Housing and Urban Development (HUD) | December 18, 2023 | FHEO # 09-22-9910-8
There are several points in the following article:
Lawsuits are expensive and pro-se litigants face an uphill battle.
[Our Amplification] Prohibiting smoking in units is a restriction of the uses of units. Reference Use Restrictions on our Declaration & Bylaws page.
Mandatory reserve funding (applicable in Florida and Maryland) is an expensive remedy to help ensure intractable differences about paying to maintain structural integrity does not claim lives. Also see What can owners do as new state rules, insurance costs drive steep condo fee hikes?
There’s a suggestion that kicking the can down the road isn’t the right answer, but that owners should be able to “make, and ultimately live with, their financial decisions.” Balancing these without forcing a solution (in this case reserve funding) is nearly impossible.
[Our Amplification] “...management companies [and] lawyers can simply tell legislators what to do.”
CAI annually spends hundreds of thousands of dollars to lobby state legislators and the results are clear.
Owner furious that condo's no smoking at home policy ignored. Can neighbor be stopped? — Ryan Poliakoff | The Palm Beach Post | April 21, 2024
Hockessin, Delaware: Board problems or simply neighbor frustration?
Homeowners say that those leading the neighborhood’s civic association are fostering a hostile environment by changing bylaws without holding a proper vote, harassing neighbors and prospective buyers and seemingly using civic association dues to pay for legal fees.
Tensions mounting in this Hockessin-area neighborhood amid clashes with civic association — Amanda Fries and Molly McVety | The News Journal | April 16, 2024
The Westminster Civic Association board has caused quite a stir in the community. During the association’s annual meeting, they dismissed a petition signed by around 80 households, which called for the removal of the board members. Despite residents’ pleas, the board refused to put a motion on the floor for voting on the leadership’s removal. They also avoided answering questions and didn’t provide specific budget figures before approving the civic association’s annual budget.
The situation has escalated, and frustrated homeowners are contemplating filing complaints with Delaware’s Common Interest Community Ombudsman. Some individual residents have even considered filing civil suits against the board. The tension stems from various issues, including alleged harassment, interference with property sales, and an overall hostile environment within the community.
It remains to be seen how this conflict will unfold, but the community is determined to hold the board accountable for its actions…
Following board refusal to step down, Westminster residents continue fight — Amanda Fries | The News Journal | April 18, 2024
Montclair, Virginia:
A Virginia woman who says she cut down the trees in her yard after one fell on her house and killed her husband last year finds herself in a dispute with her homeowners association.
Allan Lee was taking a shower last July when a tree crashed through the house and killed him.
“He was part of our everyday lives,” said his wife, Rachel Lee. “He was very invested in his kids and in me. He just wanted to make sure everyone was happy all the time.”
Recently, she hired a contractor to cut down the rest of the trees in her backyard.
“I don't want another one to fall on the house and orphan my kids or kill my kids,” she said.
The Montclair community she lives in near Dumfries is governed by a homeowners association that requires residents to submit a "property improvement request" before exterior projects.
“I didn't ask permission because I wasn't going to not do it if they told me not to do it,” Lee said. “It was gonna happen no matter what.”
VIDEO: Virginia woman battles HOA over tree removal after fallen tree killed her husband — Aimee Cho | NBC4 | March 15, 2024
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