Housing recovery took a minor hit during government shutdown

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While the housing forecast remains mostly unchanged, the contentious negotiations that led to Congress temporarily raising the debt ceiling may have a lingering impact on consumer confidence in the housing market.

Consequently, the housing recovery will be temporarily interrupted, but not derailed, according to Fannie Mae’srecent outlook.

“Our October economic and housing forecast is largely unchanged from the previous forecast as we anticipated the modest levels of consumer spending seen toward the end of the third quarter,” said Fannie Mae chief economist Doug Duncan.

He added, “However, fiscal uncertainties associated with the federal government shutdown, the protracted negotiations to raise the debt ceiling, and the timing of the Federal Reserve’s tapering of its asset purchase program, pose significant downside risks to economic activity in the current quarter.”

Nonetheless, recent declines in long-term interest rates should help support the housing market. Mortgage rates will continue to gradually rise, averaging 4.4% in the fourth quarter and 5% a year from now.

Meanwhile, incoming housing indicators remain generally positive.

For instance, existing homes sales rose to their highest level in more than six months, reflecting a rush to buy before mortgage rates rose even further.

Homebuilder confidence also remains at a recovery high, with the measure of prospective buyer traffic gaining again, despite continued rising mortgage rates, Fannie Mae noted.

While the shutdown lasted nearly a month, it’s important to note the mortgage market took a slight hit.

The Federal Housing Administration continued processing new loans during the shutdown, despite a lack of staff. Lenders with delegated authority also continued to endorse new loans independent of the agency, making it easier now for the FHA to catch up.

Nevertheless, the shutdown will likely have a future impact on housing activity, including the pace of FHA endorsements for small lenders as well as Ginnie Mae issuance.

Additionally, industry players may experience shutdown-related processing issues or exercise caution amid uncertainty, Duncan explained.

As a result of the fiscal events and the slowing momentum in economic activity from the second quarter to the third quarter, full-year growth is expected to come in at 1.9%, a downgrade from market expectations.

Emailing Residential Tenants In California

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While email use is common and is growing faster than “snail mail”, the California legislature does not generally recognize email as a valid delivery method for most formal communications provided by California residential landlords to tenants . California law requires other delivery methods for most formal California residential landlord communications.

Generally, California law requires that residential tenants be served notices by:

  • personal service; or
  • posting on the property and mailing a second copy, normal mail the same day; or
  • substituted service by delivery to someone of suitable age and discretion and mailing a second copy, normal mail the same day .

While email has existed for decades, until recently, the California legislature ignored email as a communication method between California residential landlords and tenants.  Finally, beginning in 2013, the California legislature authorized emailing two different California residential landlord communications (1) security deposit accountings (but only with the parties’ agreement) and (2) abandoned personal property notices.

Email can be used:

  • for informal landlord/tenant communications ;
  • to serve security deposit accountings, if landlord and tenant have agreed (preferably written agreement) to email delivery; or
  • as a supplemental method of serving abandoned personal property notices (notifying a resident or other party that when the unit was vacated, personal property was left in the unit).

1. Even if a landlord does not use an authorized service method, in some cases a notice may still be effective if there is proof that a tenant actually received it.  See University of  S. Cal. v. Weiss (1962) 208 Cal.App.2d 759, 25 Cal.Rptr. 475, 480 and Reserve Oil & Gas Co. v. Metzenbaum  (1948) 84 Cal.App.2d 769, 774, 191 P.2d 769, 799; Colyear v. Tobriner (1936) 7 Cal.2d 735, 743, 62 P.2d 741, 745.

2. There are a few exceptions for (1) rent increases, (2) entry, and (3) termination of month to month tenancies; specific alternate service methods (not including email) are allowed for service of those specific notices.

3. Both Federal and state laws prohibit emailed “spam” (i.e. unsolicited commercial email advertisements).

For information about how to serve notices on California residential tenants, see Kimball, Tirey  & St. John’s article, “How to Serve a Notice on a Residential Tenant.”

FYI: Why Do Leaves Turn Different Colors?

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The burning question of the season

By Daniel Engber –

Leaves are loaded with chlorophyll, which makes them green. But all green plants also carry a set of chemicals called carotenoids. On their own, these look yellow or orange—carotenoids give color to corn and carrots, for example—but they’re invisible beneath the chlorophyllic green of a leaf for most of the year. In the fall, when the leaves are nearing the end of their life cycle, the chlorophyll breaks down, and the yellow-orange is revealed. “The color of a leaf is subtractive, like crayons on a piece of paper,” says David Lee, formerly of Florida International University, who has studied leaf color since 1973.

Most trees have evolved to produce a different set of chemicals, called anthocyanins, when it’s bright and cold in autumn. These have a reddish tint and are responsible for the color of a blueberry. They’re also sometimes made in newly sprouting leaves, which explains their sometimes reddish tint. Where chlorophyll and anthocyanins coexist, the color of a leaf may run to bronze, as in ash trees. At high enough concentrations, anthocyanins will make a leaf look almost purple, as in Japanese maples.

More drab autumn colors form as leaves really die and complete the breakdown of the chloroplasts. When they’re all dried out, the pigments link up together into what Lee calls a “brownish gunk.”

Have a burning science question you’d like to see answered in our FYI section? Email it to fyi@popsci.com.

This article originally appeared in the November 2013 issue of Popular Science.

Stanford Shopping Center plans four new retail buildings

A view looking at the new Bloomingdale's. Click above to see the layout of the planned new buildings.

A view looking at the new Bloomingdale’s.

Stanford Shopping Center is adding four new retail buildings — and maybe retailers including Palo Alto Creamery and Anthropologie —without changing its total footprint.

How? Essentially, a game of retail musical chairs.

Mall operator Simon Properties this month submitted early plans to the city of Palo Alto for the project, which will complete a reshuffling of two longtime tenants and upgrade the mall’s appearance. The plans may hint at who’s on deck for the new space (more on that below).

Here’s how it all works: The four new shop buildings, totaling about 140,000 square feet, will stand at the site where Bloomingdale’s has been for decades. That’s possible because Bloomingdale’s will soon move to a smaller location, where the Fleming’s restaurant used to be. But don’t shed any tears for Fleming’s: It’s already moved to a new building on a portion of a former parking lot.

The upshot: The new buildings will soak up the space Bloomie’s left behind, keeping the mall at the same size limit of about 1.475 million square feet.

“Modernizing the Stanford Shopping Center to reflect today’s simple yet elegant life style is our goal for the project,” Simon architects write in a project introduction.

What’s on tap

The most significant part of the new phase, which must still be approved by the city, is the four new buildings. Three would be a little over 30,000 square feet, with the fourth weighing in at 51,000 square feet. The latter would also include office space on the second floor.

The buildings will be arranged in a grid, with two new pedestrian streets running through them. The new east/west walkway “will become another major shopping street, similar to Main Street,” Simon officials wrote. “This gradually widening street is envisioned to be a tree-lined urban environment with a modern and exciting ambiance.”

AFTER INSURANCE INDUSTRY POW-WOW, WHITE HOUSE DELAYS OBAMACARE’S INDIVIDUAL MANDATE BY SIX WEEKS

WASHINGTON, DC - JUNE 28:   In this handout pr...

WASHINGTON, DC – JUNE 28:  U.S. President Barack Obama talks on the phone in the Oval Office, after learning of the Supreme Court’s ruling on the individual mandate of the ‘Patient Protection and Affordable Care Act’ on June 28, 2012 in Washington, D.C. (Image credit: Getty Images via @daylife)

Yesterday afternoon, chief executives of 12 major health insurers—including Aetna, Humana, WellPoint, and Kaiser Permanente—trudged to the White House to “discuss…ongoing implementation of the Affordable Care Act.” The meeting was off the record, but we have a pretty good idea of what happened. Insurers were likely to urge the White House to delay the implementation of Obamacare’s exchanges until the website, Healthcare.gov, gets fixed. And it appears they got their wish.Last night, the White House confirmed that it intends to delay the enforcement of the individual mandate by as much as six weeks.

“The White House is meeting with insurance industry executives,” a consultant to insurers told Ezra Klein, “and I can tell you what they’re talking about. [They’re saying] you need to get this fixed, because you’re setting us up for a real fall with our customers. [Patients are] not going to blame Kathleen Sebelius if they walk into their doctor’s office and the doctor doesn’t know who they are. They’ll blame the insurance company. And I’m sure what the insurers are telling the White House today is we will not let you put us in that position.”

So here’s what the White House did, according to Sarah Kliff of the Washington Post. Earlier, in response to an inquiry from tax-preparer Jackson Hewitt, the administration said that Americans needed to buy health insurance by February 15 in order to avoid the individual mandate’s fine against those who go without coverage. The “open enrollment” period in 2014, however, during which you can buy coverage and still gain access to Obamacare’s provisions regarding pre-existing conditions, ends on March 31.

So the White House decided that it would move the deadline for buying insurance back to March 31, even if that means people went without coverage through April, because it takes time for an “enrollment” to turn into actual coverage from an insurer. Some reporters are downplaying the importance of the delay. But it is a significant move by an administration that has aggressively defended the individual mandate against efforts by Republicans to delay it; the recent government shutdown was in part precipitated by this dispute.

It’s not clear what legal justification the White House is using for its unilateral delay of the individual mandate, but the Affordable Care Act contains many loopholes and exceptions that give the Department of Health and Human Services power to selectively enforce the law. Earlier this summer, the GOP-controlled House of Representatives passed a one-year delay of the mandate, but that bill died in the Democrat-controlled Senate.

Broussard: ‘The verdict’s out’ on healthy people signing up

I recently spoke to one of those CEOs, Bruce Broussard of Humana, at the Forbes Healthcare Summit. Broussard expressed optimism that the website would eventually get fixed. But he was more cautious about whether or not healthy and young people will pay lots more for health insurance in order to subsidize other people.

“The exchanges probably are a good thing,” says Broussard. “It’s expanding coverage for people, and we think that in the long run it will be the right thing to do. In the short run, it’s got some bumps, and the industry and the government expected that. But we are focused on fixing those bumps, and to work with the government to make it both a good experience [while] driving down health care costs and improving the quality.”

We know that sick people will sign up, because the law heavily subsidizes coverage for them. But will other people? “The verdict’s out on that, to be honest with you…the federal government and the states are trying to stimulate more and more people to sign up. I think as the penalty increases for not having insurance, probably you will see more people sign up. But in the short run, it could be [sicker] people that just need coverage.”

New crowdfunding rules: First words from FundersClub, AngelList, others

Alex Mittal

FundersClub CEO Alex Mittal worries that $1 million a year limits on crowdfunding proposed by the SEC are too low.

Leaders on the front lines of crowdfunding got a first look at 500 pages of new investment rules and their initial reactions ranged from guarded to outright negative.

The guidelines from the Securities and Exchange Commission allow startups and small businesses to raise as much as $1 million a year from anyone, rather than the pool of wealthy investors who previously were eligible. Leaders at AngelList, FundersClub, WeFunder and CircleUp, who are still digging into the rules, shared their first take with me.

Groups like AngelList and the others are crucial to the crowdfunding proposals because the SEC envisions them potentially acting as portals where the investing public can connect with companies.

“I think the community is still trying to figure out what this will mean but a $1 million a year limit on crowd-funding from unaccredited investors is too low,” Alex Mittal, co-founder of FundersClub, said. “If you look at the companies that make a major impact, they all raise many millions of dollars. Most, if not all, of our portfolio are over $1 million in early funding.”

FundersClub offers highly curated series of pooled deals to an invitation-only network of private investors who meet current SEC wealth requirements. That means they have liquid net worth of at least $1 million or annual income of $200,000 or more.

Mittal called the SEC’s decision not to require startups to verify the income levels of their investors “a huge step in the right direction.”

Naval Ravikant, co-founder and CEO of AngelList’s huge network of founders and qualified funders, said he doesn’t have a problem with the $1 million funding limit but hasn’t had time to form opinions on other aspects the new rules yet.

“The average raised on AngelList is right around $1 million,” he told me. “Many companies raise $750,000. Many raise $1 million to $2 million. If it’s a $1 million max from the crowd, that seems reasonable to me, assuming that the rest can still be raised in the same offering from accredited and institutional investors. Hopefully it’ll keep pace with (startup) inflation, etc., too.”

Nick Tommarello, CEO of Boston-based WeFunder, said he was worried that the SEC would prohibit startups from raising more than $1 million per year total from unaccredited investors and wealthier funders.

“We’re relieved to see that wasn’t the case,” he told me. “We are also somewhat relieved that it appears the SEC will accept self-verification by investors. It’s not completely clear yet but it looks like that will be the way it works.”

Ryan Caldbeck and Rory Eakin, co-founders of San Francisco-based CircleUp, panned the proposed rules, saying they don’t think any qualified startup will want to raise money under the proposed regulations.

Their network focuses exclusively on the consumer-product and retail startups that some say are the real targeted beneficiaries of the crowdfunding called for in last year’s JOBS Act.

The CircleUp execs are worried by the SEC’s proposals to require any annual reports and audits from any startup that raises more than $500,000 from unaccredited investors.

“It’s going to be very difficult to attract quality startups who will agree to those conditions,” Eakin told me. “These rules may work for some small businesses in some parts of the country but they aren’t going to be of much use to the fast-growing companies that we work with.”

Caldbeck said that startups often find they need to raise more money than they planned and more than $1 million in a 12-month period. “The limit may seem reasonable at first but pose a problem later.”

None of the leaders of the four startup funding networks are ready to say whether they plan participate in the type of crowdfunding outlined in this week’s SEC proposals. CircleUp and WeFunder are already registered as broker-dealers, so they could do so without meeting any further SEC qualifications.

“If somebody says they are ready to proceed under the rules announced today, they were already going to do so anyways,” Mittal told me. “We prefer to take the same cautious and measured approach that we are hearing from members of the venture and legal communities we talk to here in Silicon Valley.”

UCLA’s Geffen School of Medicine gets some ‘TLC’ as campus breaks ground on innovative center

By Elaine Schmidt –

Teaching and Learning Center groundbreaking

Breaking ground on TLC
A crowd of 70 guests gathered Sept. 25 at the intersection of Tiverton and Le Conte avenues for a festive groundbreaking ceremony for UCLA’s new Teaching and Learning Center for Health Sciences, or TLC.

Expected to be completed in 2016, the six-level, 110,000 square-foot building will enable the David Geffen School of Medicine at UCLA to update its educational programs and improve teaching and learning. Campus leaders say the facility will serve as a magnet for recruiting medical students, staff and faculty.
Funding for the $120 million project will come from UCLA Health System reserves and philanthropic gifts. Plans call for environmentally friendly construction, and UCLA will apply for certification from the Leadership in Energy and Environmental Design (LEED) national rating system.
“Today really marks a milestone for medical education,” said Chancellor Gene Block. “This dazzling facility will transform the learning experience for our students and help shape future leaders in medicine, medical research and medical education.”
Describing the building’s environment as a welcoming hub for students to gather, as well as a place to think, Dr. Eugene Washington, vice chancellor for health sciences and dean of the Geffen School of Medicine, said, “This supportive setting will nurture big ideas that can change the way we teach and practice medicine.
“Our students are highly gifted and talented individuals who are deeply committed to medicine,” he said. “You are our inspiration and give us our energy and sense of urgency to complete this project.”
A desire to consolidate some of the medical school’s teaching facilities — they currently span 11 buildings throughout UCLA’s south campus — as well as emerging trends in medicine and medical education inspired the new building. In particular, the Teaching and Learning Center will be more conducive to instruction in team-based approaches to medical care and the increasing presence of mobile technologies for diagnosing, tracking and monitoring disease.
The medical school’s current classrooms were built more than 60 years ago, when lectures were the primary teaching method. Since then, teaching has evolved new methods that promote problem-solving, teamwork, interpersonal communication and computer simulations. The building is designed to naturally enhance these activities and enable students to practice new skills.
“We will have new classrooms with no podium in front,” said Dr. Margaret Stuber, assistant dean of student affairs for well-being and career advising. “Instead, there will be small groups of students at tables surrounded by whiteboards and flat-screen monitors around the room to enhance active learning, which is our curriculum’s focus.”
In addition to eventually improving public health, the new center will also promote the health of those who work and study there.
“The architects have positioned the new building’s stairways so that they are inviting and obvious,” Stuber said. “Our current stairwells are neither.”
Stuber is meeting with students to discuss placing artwork in stairwells and other ways to encourage exercise by taking the stairs instead of elevators.
In addition to technology-enabled classrooms that facilitate active learning, the Teaching and Learning Center will feature a clinical-skills training center and innovative, flexible teaching labs that promote collaboration and interaction, as well as spaces for students to relax, room for student organizations to meet and offices for admissions, financial aid, student affairs and other student services.
The Sept. 25 ceremony concluded with remarks by first-year medical student Caroline Gross, 23, a Geffen Scholar and member of the Class of 2017 — the first that will enjoy the Teaching and Learning Center.
“The Teaching and Learning Center will help maximize my class’ contributions to the fields of medicine and science,” Gross said. “This new building will further foster community growth as it builds upon the incredible foundation already established at UCLA.”
For more news, visit the UCLA Newsroom and follow us on Twitter.