Greater Hartford Real Estate Blog

With rising food prices, growing your own vegetables at home is a good way to reduce your expenses.

Vegetable gardening is rewarding on many fronts, reducing your food bill is just one benefit. You’ll get to spend time outside in the fresh air, get some exercise, have better tasting food, and make the world a little greener.

One of the downsides of vegetable gardening is that you may spend a lot of time loving and caring for your garden, only to find that the wild neighborhood animals are enjoying the fruits of your labor. I read this book two summers ago and related very well to the author. After working all summer on a bountiful crop of tomatoes, Kyle and I came out one morning to find all of them missing. Well, except for the ones with one small bite taken out and dropped to the ground. Grrrr….I had some choice words for little furry animals that day.

Since then, Kyle and I have taken a minimalist approach and grow basil on our porch…

Kyle’s parents who live in Vermont have gone to the other extreme with their rooftop garden. They grow swiss chard, lettuce, green beans, and a host of other veggies…



A good tomato crop is on the way…



You really don’t need to worry about squirrels, deer, and bunnies eating from your rooftop garden…



While we all can’t enjoy rooftop gardens, outside container gardening may be something you’d like to consider for next year, or inside for this coming winter. It’s easy enough to fill some pots and get started (as long as you have adequate sunlight). Here’s an excellent book that got Kyle’s parents started on their journey.

Have fun and eat fresh!

 

The ‘burbs have attracted entire generations of Americans looking for their own little piece of paradise.  A small plot of land where they can plant a garden or put up a swing set.  Play fetch in the yard with the dog or catch with the children.  A nice little neighborhood and good clean fresh air.

They were willing to travel a little further to their jobs, in many cases suffering through brutal traffic.  And they were willing to pay a little more in taxes since the suburban communities tended to have fewer businesses on the tax roles.

Although the tradeoffs are manageable in an economic environment where energy is cheap, the recent spike in gas prices has made the traditional American car culture much more expensive to maintain.  We’re seeing folks struggling to make ends meet throughout the country.  Since the general perception is that energy prices will remain high for the foreseeable future, folks are beginning to rethink their budgets.

Early in the week I saw my first article suggesting a major, but logical, way to handle higher gas prices - move.  Move closer to your job.  Move closer to the town center where you do your regular shopping.  Move closer to your family and friends that you visit regularly.

I’d been waiting to see this article in the mainstream press.  It makes sense.  In many cases it’s easier than keeping the house but finding an acceptable job closer to home.  And it’s sufficiently dramatic to make for a good story.  It was bound to show up at some point.

However, I was surprised to see two more variations on the same theme show up shortly after.  First we have this piece forecasting the death of the suburbs. And then there was this one focusing on the increasing attractiveness of living along public transportation lines.

In the Hartford area we have some public transportation.  We have some of our big employers co-located downtown.  And we have some urban housing.  But we are not New York.  My guess is that rather than focusing on true city living, folks will gravitate to the inner neighborhoods and towns to minimize drive time rather than get rid of their cars all together.

But if folks start moving closer to the city, what’s going to happen to the more distant communities? Who will live there and what will become of all the strip malls? Will they become the new ghost towns?

 

Time for an update on mortgage rates! 

As has been written in this space before (here and here), mortgage rates are currently being driven by inflation expectations.  The Federal Reserve has been focused on supporting the economy by lowering short-term interest rates at the expense of the dollar, which is one cause of inflation (another major one being the huge demand for oil/energy in China).

The graph on the left compares mortgage rates for 30 year fixed loans, in blue, to the rates for 10 year Treasury Bonds, in green.  For the second half of 2007 and the beginning of 2008 they moved in lockstep.

After a series of aggressive government actions in late January, and then the Bear Stearns “deal” in March, Wall Street finally realized that the Federal Reserve would continue to cut interest rates to support the economy.  Whatever it takes.  Thus inflation is a real concern.  This can be seen in the chart as both the blue and green lines find bottoms and beginning to increase (higher rates).

An immediate question that jumped out at me: Why did mortgage rates jump even more than the Treasury rates in 2008?  One factor at play is the difference in duration of the two loans.  30 year fixed mortgage rates are far more sensititve to inflation than 10 year Treasury bonds because they extend 20 years longer.  I’d have to do some serious math to figure out how much of the impact can be explained by duration, so let’s just say that it is one factor and others are also possible.

Last week there was an important shift in the government’s position.  Ben Bernanke, Federal Reserve Chairman, said that the Federal Reserve Board is “attentive to the implications of changes in the value of the dollar for inflation and inflation expectations.”  This is the first direct acknowledgement that inflation is of concern, and Wall Street intepreted the statement to mean that there will not be any more interest rate cuts.

For us in the real estate market, Mr. Bernanke’s statement seems to have hurt more than helped.  Wall Street has reacted by bidding up interest rates - they seem to be using his statement to support their fears that inflation could increase.  Higher mortgage rates tend to hurt sellers as the purchasing power of buyers decreases.

Of course all of us already knew that inflation was beginning to hurt, and if you didn’t, then you must not be driving or watching the news…