MONEY First-Time Dad

Why This Millennial Is Kissing the City Goodbye

Luke Tepper
This time next year, Luke will hopefully be playing on grass.

MONEY writer and first-time dad Taylor Tepper announces his retirement from urban living.

Renters in New York City have a uniquely dysfunctional relationship with real estate: The more time we spend living in some of the most desirable housing in the world, the less happy we become. Or maybe that’s just me.

My wife and I pay $2,100 a month for what seems like two square feet and minimal natural light in a converted hospital in a cool Brooklyn neighborhood. There’s an artisanal pizza shop, hole-in-the-wall cafe, and kid-friendly beer garden right around the block. I’m a 15-minute walk from a major metropolitan museum, botanical gardens, and the best park in all of New York. When it’s warm I bike, toss the frisbee, and drink whisky on rooftops. The beach is only 30 minutes away.

Unfortunately, warmth doesn’t last forever, and when it gets cold outside—say, from Thanksgiving to Easter—I spend more time indoors. Which means I’m trapped with a 21-pound baby monster who smashes, grabs, and pounds anything he can get his hands on, from cellphones to lamps. As a result, I’m slowly devolving into madness. Spending hours upon hours inside with two other people, only one of whom yields to reason, punctuated by intermittent excursions into tundra-like conditions, makes it seem as if the walls are slowly inching in on themselves.

Don’t get me wrong—I love the city, I went to school in New York, I’ve lived here for almost the entirety of my adult life. But after 13 months as a father and 19 months as a husband, I’m ready to escape to the land of malls and carpool lanes, single-unit houses and trees, the land of my birth: suburbia.

That said, it’s one thing to want move, it’s another to actually do it. Here’s a window into my thought process—and that of other millennials facing the same decision.

We’d Still Be Renters

Years of high rent and monthly student loan bills, combined with the cost of childcare, made it next to impossible for us to save up for a down payment. So we’re looking to rent wherever we go, which should mean more money left over for us. According to NerdWallet.com’s cost of living calculator, we could reduce our housing costs by about 25% if we moved to northern New Jersey or Long Island.

Even if we had enough funds stashed in our joint bank account, there are a couple of reasons why a home purchase would be a poor move. For one, conventional wisdom states that your target property should be no more than two and a half times your gross income. The odds that we’d find a New York-area home in the $300,000 range that’d we’d actually want to live in are low.

OK, let’s say that we had the savings and lived in a less expensive city. Should we jump into the market then? Not necessarily, says Pensacola, Fla.-based financial planner Matt Becker.

“Don’t rush to buy a house just because you want to go the suburbs,” Becker says. “That can lead to a quick financial decision as opposed to a good one.” Since transaction costs are so high, we’d need to stay in the home for a number of years to for buying to make financial sense. And who knows if we’ll want to live in a particular town for that long? My wife and I are still early on in our careers, we could end up lots of places.

Even Though Now Is a Good Time to Buy

If your bank account is fatter than ours and you’re ready plant some roots, buying might make sense. In fact, if you can get a mortgage, now is a great time to buy, since 30-year mortgage rates are absurdly low. Mortgage behemoths Fannie Mae and Freddie Mac announced late last year that they would allow down payments of as low as 3% on some mortgages. (These moves were directed at people who haven’t owned a home for three years, or are in the market for their first house.)

Once you’ve made the decision to move, you need to think about where you’d like to spend the next seven to 10 years. While we need more space, I don’t want to give up some of the best aspects of the city—good restaurants, a sense of community, hipster/independent movie theaters—in the trade. In that regard I’m like a lot of young buyers, says Greensboro, N.C.-based Realtor Sandra O’Connor. “There’s real movement among millennials who are looking for places to live with walkable areas,” she says. “They don’t want to always be in their car.”

If you’re still undecided about whether renting or buying is the better choice for you, check out Trulia’s rent or buy tool. Those who fall in the rent camp should understand that finding rental units outside of cities can be a lengthy process, per O’Connor and Becker.

All Suburbs Are Not Created Equal

So I want to move, but where should I go? I put the question to Alison Bernstein, president of the Suburban Jungle Realty Group, a firm that specializes in helping its clients find the best New York City suburb for them. Bernstein says that city dwellers eager to jump need to “understand that a house is a house, but the dynamic of a town is very difficult to grasp.”

To that end, Bernstein laid out a number of questions that anyone thinking about relocating needs to consider:

How many working moms are in town? What type of industries are there? What’s the breakdown of private versus public school? Even if the schools are highly ranked, there are towns where there is a lot of momentum to send kids to private schools and this does change the personality of the town quite a bit. What do you do over the summer? Does the entire town empty out? Does everyone hang out at the pool? Who is moving to the town? How will that change the school system and the vibe over the next 10 years?

Bernstein has also noticed a few trends with today’s younger buyers. “They are happiest with a smaller piece of property, a more modest home, and being in a more cosmopolitan suburb. Also they are not plowing every last penny into their house. They are still budgeting for travel.”

The Costs of Commuting

Right now I pay $112 a month (soon to be $116) for a 30-day subway pass to get to the office. We are only a 20-minute drive from my wife’s work, which means we shell out a very reasonable $50 a month on gas. When we move to the suburbs we will pay more. For the sake of argument, let’s say that we end up relocating to Pelham, New York, just north of the city. My monthly bill rises to $222, while my wife’s morning drive will consume almost twice as much gasoline, meaning our monthly outlay will jump by about $160.

But that’s just the money. The time we spend going from home to work and back will grow as well. Doing some back of the envelope calculations, my in-transit time will increase by 10 minutes each way, while Mrs. Tepper will spend an additional 20 minutes or so in traffic. Combined we’ll endure about an hour more per day on our commute, which sends shivers down my spine.

There are a few positives about the longer commute, though. For one, car insurance is generally cheaper outside of the city. According to CarInsurance.com, the average rate in my neighborhood is a little less than two times that of Pelham’s. While I wouldn’t necessarily expect to cut our car insurance costs in half, this savings would take a bit of the sting out of much higher commuting costs.

Aside from lower insurance rates, we could also dedicate a portion of our new abode as a work space. As Mrs. Tepper and I advance in our careers, we hope to have more leeway in terms of a flexible work arrangement. While our commute might be longer, we’ll most likely have to do it less often. And each saved car ride is more money in our pockets.

The Tradeoffs

Getting older involves a series of decisions that have the net effect of limiting one’s personal freedom. I became a journalist, which means I couldn’t be a doctor (leaving aside the question of whether or not I had skill to do it in the first place). Marrying one woman, and being keen on staying married, means I can’t marry a different one. A life in one town is a life not lived in another.

Which is all to say that I’ll miss living in Brooklyn. Despite the hipster clichés, I really do enjoy artisanal, delicious, overpriced hamburgers and 17 different IPA varieties at my bars. I like walking everywhere, even if we have a car, and a touch of self-righteousness about your home is good for the soul.

But I think of my sojourn in New York’s best borough as I think of college: I wish I could stay forever, but it’s time to move on.

Financial planner Matt Becker understands my dilemma. He recently moved from Boston to suburb-rich Pensacola and is still adjusting to his new life. He walks less and drives more. While his young family has more space to play and grow, that also means he has more house to furnish and air condition, which means more costs. I imagine we’ll encounter something similar.

The combination, though, of high rent and minimal space has lost its luster. Even if we end up breaking even in our move, or only saving a little bit, our dollars will go further. We can have a backyard for our son and our dog and us. We’ll have a laundry machine on the premises, so we don’t have to lug 20 pounds of clothes a couple of blocks through the snow. We’ll have a full-size dishwasher.

I proudly proclaim without regret what might have depressed my younger self: these amenities are more appealing than staying in Brooklyn.

More From the First-Time Dad:

TIME World

This Indonesian House Is for Sale and Comes With a Pond, a Backyard and … a Wife

If you don't talk the price down, you can marry the owner

A homeowner in Indonesia has put her house on the market, and herself with it.

The two-bedroom, two-bathroom home in Sleman — a sleepy district near the Javanese city of Yogyakarta — comes with a fishpond, spacious backyard and a chance to ask 40-year-old owner Wina Lia for her hand in marriage.

The asking price is the rough equivalent of $76,500. “Buyers who don’t negotiate the price,” the sales literature says, “can ask the owner to marry (terms and conditions apply).”

Wina’s online ad went viral, prompting a local news outlet to track her down and confirm that the offer was genuine. “Indeed it’s true, Wina is ready to be married by a house buyer,” the headline says, as tweeted by Sleman’s unofficial Twitter account.

Dian Purna Dirgantara, the realtor who concocted the plan, tells TIME that his advertisement is working.

“Since yesterday morning there are continuous calls, I don’t count how many, there must be dozens or even hundreds.” He clarifies that marriage isn’t a must. “If someone just wants the house, they can have that,” he said.

Wina, a single mother, told news outlet Kompas.com that the idea was dreamed up when she mentioned her desire to once again find a partner.

“Dian suggested I put up the tagline ‘Buy the house and marry the owner at the same time.’ And I said O.K. to it. I’m looking for a husband anyway,” she said.

Read next: Watch This Guy Propose to His Girlfriend 365 Times Without Her Knowing

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MONEY home improvement

7 Things Every Remodeling Contract Must Have

Q: The builder who’s doing my family room addition handed me a fill-in-the-blanks form contract with handwritten details and numbers. It looks about as unofficial as can be. Is that a problem? What should a remodeling contract include?

A: A contract doesn’t have to be printed off a computer—or contain a bunch of legalese—to get the job done. But it should clearly state the arrangement that you and your contractor have about the project, and it sounds like this document probably doesn’t do that very well.

“Putting everything in writing helps clarify both parties’ expectations at the beginning,” says Fairfield, Conn., construction attorney Neal Moskow. “And it’s much easier to fulfill your expectations at the end if they’re clearly stated from the start.”

The safest bet is to have your attorney draw up a contract for you. But even if you choose a less formal approach, here are the basic elements Moskow recommends including—either by typing up a new document or just making handwritten changes on the existing form, as long as both you and the contractor initial each change.

 

1. A description of the project. The contract should include a project description that thoroughly outlines all of the work, materials, and products that will go into the job. That includes everything from what will be demolished to what will be constructed—and each different material and fixture that will be used, with its associated cost. It should also specify that the contractor will obtain all of the necessary permits (and close them out by getting the required certificates of occupancy) and dispose of the debris properly, and that the project is covered by his liability and workman’s compensation insurance.

2. How (and how often) the contractor will be paid. Not only should the contract state the total project price, but it should also outline the timing and amount of installment payments based on project milestones, such as when the foundation is completed, the rough plumbing and electricity are installed, or the wallboard and trim are done. Your initial payment at the start of the job should be no more than 10% of the project cost. If the contractor has to immediately place orders for expensive items such as windows or cabinets, offer to pay the supplier directly. The final payment should be at least 10%, payable only when the “punch list” (the roundup of final project details) is completed to your satisfaction.

3. Lien waivers. Here’s a scary thought: Any worker who comes to your house as part of a remodeling crew could place a lien on your property, claiming he was never paid for his work—even if you have paid the contractor in full. So write into the contract that your contractor must provide you with a “lien waver” for each installment before you pay the next one. What that means is that the invoice for each payment needs to include a signed statement indicating that the contractor used your previous payment to pay for the labor and materials described in its invoice. That gives you some legal protection against liens from him or his employees and subcontractors.

4. Approximate project dates. Discuss approximate start and end dates for the project with your contractor and write them into the contract. The point is not to hold him to an exact date but to ensure that you both have an understanding of when work will commence and—barring weather interruptions or major plan changes—about when it will be completed.

5. A procedure for changes. Write in that no changes to the original plan can commence until the contractor has given you a clear description of the new work, how much it will cost, and how it will affect the schedule—and until you have given written approval. Change orders should be done with pen and ink (or by text or email). If you ever make a verbal agreement on the fly, follow up with an email to the contractor restating the details and your approval, and ask him to respond with a confirming email that you got the details right, so you have a written record.

6. An escape hatch. Some states’ consumer protection laws give homeowners three days to rescind a contract without penalty. And it’s a good idea to write in just such protection for yourself if you’re not in one of them. This prevents you from losing your deposit if, for example, you sign the contract and then find out that there’s a problem with your credit line and you don’t have the funds you thought you did.

7. Signatures. A contract isn’t a binding legal document unless it’s signed by both parties—and in some states, it also must include the contractor’s license number and both of your addresses.

Read next: What Your Contractor Really Means When He Says…

 

TIME real estate

This Is The Salary You Must Earn to Afford a Home in America

Home
David Papazian—Getty Images

A homebuyer needs to earn $48,603 to afford a median-priced property, report says

To afford a typical house in the U.S., a homebuyer needs a minimum salary of $48,603 as well as a 20% downpayment, according to new research from mortgage publisher HSH.com.

HSH.com calculated the minimum salary a buyer must earn to pay the principal, interest, insurance and taxes associated with home purchases across 27 metropolitan areas, using fourth-quarter data from the National Association of Realtors (NAR) and average interest rates for fixed-rate, 30-year mortgages.

“Home prices in metro areas throughout the country continue to show solid price growth, up 25% over the past three years on average,” NAR chief economist Lawrence Yun told HSH.

San Francisco continues to top the list of most unaffordable cities, requiring a buyer to be paid $142,448, while New York City only requires $87,535; Boston, $80,049; Washington, D.C., $77,394 and Chicago $54,346.

If you want the most bang for your buck, head to Pittsburgh, where you’ll be fine with $31,716; Cleveland, $32,010; St. Louis, $33,323; or Cincinnati, $33,485.

Take a look at the complete list here.

Read next: These Are the Best (and Worst) States for Business

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MONEY real estate

The Pre-Recession Housing Problem That’s About to Slam Homeowners

aerial view of subdivision
David Sucsy

Millions of homeowners face major payment increases when their HELOCs reset in 2015-2016. Here are your options if you face massive HELOC payments.

The home equity line of credit (HELOC) had been around for many years before it became a hugely popular financial product in the early 2000s. When the financial crisis happened in 2008, drastically lower home valuations put a stop to the HELOC boom, and today we see far fewer being issued by lending institutions. However, millions of homeowners still have this type of contract and will face major problems when their HELOCs reach a 10-year reset point in 2015-2016.

The Office of the Comptroller of Currency (OCC) defines a HELOC as “a dwelling-secured line of credit that generally provides a draw period followed by a repayment period.” If you don’t know what these terms mean, then it’s time to have a fresh look at your contract. As a debt relief consultant who includes second mortgage and HELOC settlement negotiations in my practice, I routinely encounter clients who are worried about their homes having negative equity, but seem completely unaware of their looming reset problem.

There are numerous types of HELOC agreements, but one common variation is the 25-year contract, with a 10-year borrowing period and a 15-year repayment period. Let’s say you obtained a HELOC in 2005 that was structured this way, and borrowed $50,000 on your house to pay off other bills, do some home improvements, and so on. This whole time you’ve been paying interest-only at 6%, which is high compared to today’s rates, but since you are only paying interest on the principal balance, the payment is still manageable at only $250 per month.

What will happen at the end of your 10-year borrowing period? The line-of-credit feature of the HELOC will expire and the payments must then increase during the repayment period to cover repayment of the principal balance (plus ongoing interest). At a 6% annual percentage rate, the $250 per month payment will suddenly spike to $492 and remain at that level until the $50,000 is paid off (assuming a fixed interest rate).

This of course illustrates a 15-year repayment period, which is already greatly compressed compared to a traditional 30-year mortgage. Worse, some HELOC products were set up for a total contract duration of 15 years, meaning a 10-year borrowing period followed by only a 5-year repayment period. With such a short period of time to repay principal, the monthly payment in our example would jump to $967 after reset, almost four times the interest-only level. Talk about payment shock!

Still other types of HELOC contracts carry no repayment period at all. They were set up for a borrowing period of 5, 7 or 10 years, and at the end of that period the entire principal amount falls due in the form of a single lump-sum balloon payment. Using our same example, at the end of 10 years, instead of paying $250/month, you now owe $50,000 in a single payment.

Such financial products were built on the crucial assumption that real estate values would continue to rise, which would allow qualified borrowers to refinance to more favorable terms within a few years anyway. Essentially, these products were designed with the expectation that borrowers would extinguish the loans before reaching the point of reset, especially if there was a balloon payment rather than a reasonable repayment period.

Fast forward a few years, and the steep plunge in real estate values has left countless homeowners in a position where traditional refinancing is simply not available, thus exposing them to future payment shock when their HELOCs reset in 2015 or beyond. Since so many HELOCs were issued in 2004 through 2008 compared to prior years, the “HELOC reset” problem has the potential to affect America’s housing recovery for years to come.

According to the OCC, in 2012 approximately $11 billion in HELOC loans reached reset point, with “reset” defined as the point where the borrowing period ended and the repayment period began. By 2014, that figure had grown to $29 billion. It will nearly double again to $53 billion in 2015 and could exceed $111 billion by 2018. Between 2014 and 2017, approximately 58% of all HELOC balances are due to start amortizing.

HELOC-OCC

In the next few years millions of homeowners will face the HELOC reset problem and resulting payment shock. Many will have the ability to accept the higher payment after reset, or they will refinance to a new mortgage with more favorable terms. Others may already be planning to sell the home, either via traditional or short sale. But there will still be a large pool of homeowners who find themselves facing a true financial dilemma — a contractual trap based on a product designed years ago in a different banking era, before the “new normal” of underwater property values and strict loan-to-value ratios.

Options If Your HELOC Loan Is Due to Reset in 2015 or 2016

With all that in mind, let’s focus on potential solutions for homeowners facing HELOC reset. First, if you are not sure whether this is happening with your loan, please take a close look at your agreement document. Look for the dates pertaining to the Borrowing Period and the Repayment Period, bearing in mind your contract might use slightly different terminology. If you took a loan in 2005, for example, it’s likely the reset will happen in 2015.

Once you have confirmed the date on which your HELOC will reset, the next step is to determine the new payment schedule including principal. If you have not already received a notice from your lender with this information (many lenders are sending these out well in advance to warn consumers about the pending payment increase), then you should be able to determine the new payment from the contract terms and the help of a loan or mortgage calculator. Or, perhaps much easier, you can simply call your lender and ask them what the new payment will be after reset.

1. Absorb the New Payment

Using our first example above, some household budgets can tolerate a payment spike from $250 to $492 per month. If you can fund the new payment and otherwise don’t have any refinancing options available to you, then why not give the new payment a try for 12 months? See how you do before considering an aggressive solution that may entail serious credit damage.

2. A Traditional Refinance

Some homeowners facing HELOC reset will be able to obtain new mortgage financing that solves the problem. By combining the original first mortgage and the HELOC balance into a new single mortgage, all risk associated with the HELOC reset is extinguished with closing on the new note.

Of course, many homeowners will be blocked from this solution, based on three key factors:

  • Lenders require a loan-to-value ratio of 75-80%, so the property has to be worth enough at market value to offset the two combined notes and still leave 20-25% equity as a cushion. Many homes are still upside-down in value, worth less than the two note balances combined, or perhaps worth less than the first mortgage alone.
  • Your credit score has to be in excellent shape to qualify for the best rates. (You can see two of your credit scores for free on Credit.com.)
  • Your income has to support the new revised mortgage payment, based on strict debt-to-income ratio formulas.

Unless all three conditions are in place, a traditional refinance solution won’t be available to you.

3. Modify Your First Mortgage Under HAMP, or Second/HELOC Under 2MP

Although it was announced with some press attention a few years ago, it’s rare to see the government’s Second Lien Modification Program (2MP) discussed in the context of the HELOC reset problem. Government sponsored programs like the Home Affordable Mortgage Program or Home Affordable Refinance Program (HAMP and HARP) targeted mainly first mortgages, in an effort to stabilize payments so people could stay in their homes or refinance away from toxic mortgages.

While HAMP and HARP have helped millions of homeowners over the past half-decade, the 2MP has been something of a mystery. It’s common to hear someone report having successfully modified a first mortgage via the HAMP solution. Yet reports of successful second lien modifications under 2MP are quite rare. If HAMP modifications have proceeded like a gushing pipeline, 2MP modifications are more like a tiny trickle.

According to the Department of Housing & Urban Development (HUD) website, you may be eligible for 2MP if your first mortgage was modified under HAMP and you have not missed three consecutive monthly payments on your HAMP modification. What this should mean, at least in theory, is that once you have finished making your three trial payments under an approved HAMP modification, then your second lien should be reviewed for a corresponding modification.

Check with your lender directly to see if they are participating in the Second Lien Modification Program. I would also encourage readers looking for more information on the government-sponsored programs like HAMP, HARP and 2MP to call a HUD agency counselor at 1-888-995-HOPE (4673). There is no cost to you, and the HUD counselor can help determine eligibility for one of these programs.

4. Modify Your First Mortgage, Then Apply the Savings to the Payment Spike

A successful loan modification on your first mortgage can result in significant monthly savings. If you modified under HAMP but your second lien did not qualify for 2MP, or you did a non-HAMP modification directly with your mortgage lender (also called an in-house or a private modification), then your first mortgage payment should now be lower than it was previously.

In some cases, the difference may be sufficient to offset some or most of the expected payment spike associated with a pending HELOC reset. Your budget will naturally determine this. If you pursued the modification due to financial hardship, then it may be that even with a lower first mortgage payment you still can’t handle the increased HELOC payment after reset. But others will find that the savings achieved through the first mortgage modification provides enough relief that the payment increase on the HELOC will no longer cause such a severe budget problem.

5. A Loan Modification Directly With the HELOC Lender

There are many situations where none of the above solutions will apply. What if you can’t absorb the new payment after reset or you have a balloon payment coming up? What if traditional refinancing is not available to you because the house doesn’t meet the required loan-to-value ratio? What if none of the government programs apply? What if modifying your first mortgage won’t or can’t work, now what?

Lenders do not want a default to occur. A logical step would be to determine precisely what in-house programs your creditor is willing to offer and see if any of these options look realistic to you. Financial institutions have been issued a strongly worded guidance by the OCC on the subject of HELOC reset, and they want servicers to work with customers to salvage these loans. So it makes sense to find out what the servicer is offering for modified terms and then compare to the original payment spike.

To get anywhere with a loan modification application, be prepared to submit two years of tax returns, bank statements, pay stubs and a personal financial statement. Be patient and polite. Do your own math before you approach the servicer for a modification. Know what you want in terms of a payment and loan duration, including possible principal deferment or even principal reduction, before you enter the negotiation. You may or may not get exactly what you want, but it pays to know your own figures and to be able to argue your case effectively.

6. Strip the Lien via Chapter 13 Bankruptcy

Bankruptcy is an aggressive solution that would only apply in specific circumstances. I mention Chapter 13 bankruptcy specifically because it has a unique feature that allows a second lien to be stripped from a property. This can only happen if the property appraises for less than the balance owed on the first mortgage, and of course with the court’s approval. If the lien strip is approved, the HELOC or second mortgage balance then becomes an unsecured debt co-equal with other unsecured debts like credit cards, medical bills and so on. The debt is then discharged after the case is completed, with five years being the typical Chapter 13 case duration. The advantage of this solution is that it yields a one-mortgage property with no further threat of foreclosure or potential litigation. It’s crucial to get the advice of a good bankruptcy attorney if your intention is a lien strip via Chapter 13.

7. Lump-Sum Settlement

Settlement is also an aggressive strategy that comes with credit damage and only applies in specific circumstances. There are tax consequences of settlement, in the form of a 1099-C for the forgiven balance, taxable income unless an exemption applies.

During the peak years of the real estate crisis many homes plummeted in value to a level below the balance owed on the first mortgage alone. That left second lien holders in a position without collateral, i.e., “underwater.” Under such conditions, many homeowners were able to settle their HELOCs for 10-20% of the balance after having defaulted for an extended period.

While HELOC settlements are still happening in 2015, conditions have changed considerably. We are now in an era of rising property values, and creditors are more reluctant to absorb a loss when the property underwater today may be “in the money” again before too long.

As a debt consultant, I find I’m recommending the settlement strategy for HELOCs much more selectively than I did in prior years. It does still work quite effectively in many situations, but it’s important to have a clear view of the risks before attempting a hardball negotiation strategy like debt settlement on a second mortgage or HELOC.

The bottom line is there is no single best debt relief solution for the problem of HELOC reset. I’ve presented seven potential strategies above, but each of those will only apply under specific financial conditions. Aside from the sister program to HAMP, the 2MP for second liens, there are no “Obama programs” for HELOC relief, and no bank sponsored programs to enroll in. Based on hundreds of consultations with consumers struggling with HELOC issues, my experience has been that creditors are taking a battlefield management approach, with the goal of stemming further losses. So beware of companies or services claiming they can have your lien extinguished, or have your HELOC note declared invalid. The growing HELOC reset problem presents a new opportunity for debt relief scammers to pitch bogus programs that promise to “make your HELOC go away.” Buyer beware!

More from Credit.com

This article originally appeared on Credit.com.

MONEY Wealth

These Are the World’s Most Expensive Cities

No, New York isn't among the top 10. Nor is Tokyo. Hint about the most expensive city: Don't take any chewing gum when you visit.

MONEY winter

Sick of Clearing the Snow? Failure to Do So Could Cost Even More

150304_EM_snow_1
Steven Senne/ASSOCIATED PRESS

It's been a stormy winter for much of the country, so it's understandable if you're tired of clearing snow off your car and sidewalk. But there's more reason than ever to handle these chores like a good citizen.

Earlier this winter—before we knew just how bad of a winter it would be—we ran a post about why it is so essential to shovel your walkway after it snows. The reasons start with getting hit with local fines for failing to clear snow and ice, and they end with the possibility of being sued for hundreds of thousands of dollars if someone falls and gets injured on your property.

In Boston, which is on the verge of crossing the mark for having snowiest winter on record, Mayor Martin Walsh plans on increasing the fine fivefold for property owners who don’t clear their sidewalks or snow and ice, or who push snow into the streets. The highest possible fine could be $1,500, up from the current maximum of $300, if Walsh can convince the city council to get on board with the idea at a meeting on Wednesday, the Boston Globe reported. If property owners don’t pay the fines, they would simply be added to the owner’s property tax bills.

“Failing to remove snow from a sidewalk puts lives at danger. It’s a problem for every pedestrian, but it is especially difficult for our children, for the disabled, and for the elderly to face deep, unshoveled sidewalks, and be forced to walk in the road,” Walsh said in a press release. “I urge the City Council and state officials to move this legislation which grants us the authority to deter these violations, hold accountable those who are guilty, and recoup some of the added costs that these violations create.”

Getting sidewalks cleared of snow and ice has also proven to be a problem in many parts of New York City, especially in neighborhoods overrun with foreclosed properties and vacant buildings, where it’s sometimes impossible to track down who, if anyone, is the owner. According to a New York Times analysis, 331 tickets for failure to clear snow off sidewalks have been issued to just 10 notorious properties in the Bronx. The Bronx has been hit with the most fines per capita (more than 10,000 violations), though Brooklyn and Queens properties have received more tickets overall, with 14,000 and 13,000, respectively.

Meanwhile, in places like northeast Ohio, unshoveled sidewalks and walkways are causing a host of problems, including disputes among neighbors and gripes from elderly residents about the unfairness of fines. In some cases, the United States Postal Service has even stopped delivering the mail to residences where sidewalks, walkways, or streets are clogged with snow and ice.

Your obligation to clear snow doesn’t stop at the edge of your property, however. Laws have been passed in New Hampshire, New Jersey, and Connecticut, among other places, requiring drivers to clear snow from cars before heading out onto roads. In the latter, drivers face fines up to $1,000 if snow or ice flies off your vehicle and causes damage to another car or motorist, but in most cases, the fine would be a flat $75.

There’s also a bill currently under consideration in Pennsylvania that would allow police to pull over cars and trucks if the vehicle is covered in ice or snow that “may pose a threat to persons or property,” regardless of whether or not any damage has been caused. If the bill becomes law, drivers would face fines of $25 to $75 for not clearing snow and ice from vehicles. That’s cheap compared to Europe, where failure to clear snow from cars in the Alps could result in a fine of €450, or around $500.

TIME

Here’s How Much the Home of the Next President Is Worth

We don’t know who will replace Barack Obama in the White House, but we do know what kind of home he or she will be leaving behind. We’ve charted them below, using data from real estate sales tracker Zillow. Not surprisingly, the only former Fortune 500 executive on the list, Carly Fiorina, tops it with her $6.7 million mansion in Virginia.

Next up is the presumptive candidate from Chappaqua, N.Y., Hillary Clinton, with her $5.6 million Washington, D.C. home —a long way from Hope but just a hair above the former Arkansas governor turned commentator Mike Huckabee, whose Santa Rosa Beach house in Florida is valued at $5.5 million. Scott Walker, the Wisconsin governor, lives in the least expensive home among those whose information is available on Zillow.

To compare the homesteads of presidential timber, click a column header in the chart below to sort by category. Scroll right to see them all.

 

The median home of the more than a dozen likeliest presidential candidates is worth $1.5 million. That’s more than eight times the value of the median American home, worth $178,500 today, according to Zillow. (The average candidate home is worth $2.3 million.) But it’s still a long way off from the address many have their eye on: 1600 Pennsylvania Ave. Zillow estimates the White House would be worth $385 million were it to ever go on the market.

Candidates’ homes have a way of becoming campaign fodder during presidential campaigns. John McCain was lampooned for being unable to say how many homes he owned in 2008. In 2012, Mitt Romney was mocked for building a car elevator in his La Jolla, Calif., residence. And this past June, Hillary Clinton drew guffaws when she said she and President Bill Clinton left the White House in 2000 “dead broke” and had to increase their earnings to “pay off the debts and get us houses.” As the 2016 campaign heats up, you’ll likely be hearing more about one or two of these homes.

This article has been updated to include Clinton’s residence in Washington, D.C.

Methodology

The listings above reflect only the candidates’ residences available in public records. Some own multiple homes. All estimated home values are from Zillow.

TIME real estate

These Are America’s Happiest (and Most Miserable) States

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The ranking illustrates how states perform in the five essential elements of well-being: purpose, social, financial, community, and physical

Alaska led the nation with the highest level of well-being of all states, supplanting North Dakota, which plummeted to 23rd place. West Virginia remains the state with the lowest well-being for the sixth consecutive year.

The 2014 Gallup-Healthways Well-Being Index measures the well-being of Americans in each state based on interviews conducted between January and December, 2014. This year’s index incorporated a range of metrics categorized into five essential elements of well-being: purpose, social, financial, community, and physical. Based on the well-being index, 24/7 Wall St. examined the states with the highest and lowest scores.

Click here to see the happiest states in America

Click here to see the most miserable states in America

While Gallup’s index is based in part on subjective survey measures, the respondents’ perceptions are often closely tied to outcomes. According to Dan Witters, research director of the Gallup-Healthways Well-Being Index, well-being is closely linked to economic indicators and societal outcomes, such as median household income and teen pregnancy rates.

Witters explained that the five essential elements of well-being are interwoven, and a high score in one category can lead to a high score in another. However, this was not guaranteed by any means. All of the 10 happiest states rated better than most in the purpose category, which measures how much residents like their day-to-day lives and how motivated they are to meet their goals. However, in other categories, such as the financial element of well-being, two of the top states overall fared worse than most states.

Physical health, which together with healthy behaviors, was part of the physical element of well-being this year, is an especially important factor contributing to happiness, according to Witters. In fact, examination of healthy behaviors and outcomes measured by government data suggest this is the case.
In states with high well-being scores, residents were less likely to smoke and more likely to exercise regularly. Residents in nine of the happiest states were more likely than most Americans to have an exercise routine of some kind. All but one of the states with the lowest well-being, on the other hand, had more physically inactive residents compared to the national average.

The states with the highest well-being also enjoyed the positive outcomes of healthy behaviors, including lower obesity rates and smaller incidences of other common health problems, while in general the opposite was true for the states with the lowest well-being. High cholesterol, high blood pressure, as well as heart disease-related deaths were all far more common in the states with the lowest well-being.

While money certainly does not buy happiness, financial well-being plays a significant role in happiness. All of the most miserable states had median household incomes far below the national median income of $52,250 in 2013. However, the median household income in only half of the happiest states exceeded the national median income.

The states with the happiest residents also had relatively low unemployment rates, and people reported relatively few days of poor mental health. The unemployment rates in all of the 10 happiest states was less than the national rate of 7.4% in 2013. And nine of these states reported fewer monthly poor mental health days than the national average.

A regional pattern is also evident. According to Witters, while the top and bottom states change regularly from one year to the next, they tend to be in similar parts of the country. Witters said states in New England, the Northern Plains and Mountain West regions, as well as Alaska and Hawaii, generally and regularly report very good well-being. Low well-being, on the other hand, is found “around the Bible Belt…the South and heading north up through the industrial midwest.” Witters described this as “a very consistent pattern.”

“The thing about those southern states,” he said, “that really hurts them is that they do a lousy job taking care of themselves.”

24/7 Wall St. reviewed all 50 U.S. states based on their scores in the Gallup-Healthways 2014 Well-Being Index. Gallup-Healthways calculated a national well-being score as well as one for each state based on interviews conducted between January 2 and December 30, 2014, with a random sample of 176,702 adults. As part of the rank, Gallup combined five separate essential elements of well-being. In addition to the index, 24/7 Wall St. considered data from the U.S. Census Bureau’s 2013 American Community Survey, including median household income, poverty rates, and adult educational attainment rates. From the Bureau of Labor Statistics, we reviewed annual state unemployment rates and median hours worked among, both from 2013. We also reviewed 2013 obesity and teen pregnancy rates from the Centers for Disease Control and Prevention. Incidence of heart disease in 2013 is from the Kaiser Family Foundation. The share of the population with low incomes and low access to healthy food comes from the Department of Agriculture’s Food Environment Atlas. Low access is defined as living more than one mile from a supermarket in an urban area or more than 10 miles from a supermarket in a rural area. We also considered state violent crime rates in 2013 from the FBI’s Uniform Crime Report Program. Lastly, we used 2012 regional price parity from the Bureau of Economic Analysis as a proxy for cost of living. All other data come from the United Health Foundation’s 2014 report “America’s Health Rankings”.

These are the happiest (and most miserable) states in America.

The Happiest States in America

10. Texas
> Poverty rate: 17.5% (13th highest)
> Unemployment rate: 6.3% (17th lowest)
> Obesity rate: 30.9% (15th highest)
> Poor mental health days (last 30 days): 3.2 (9th lowest)

Based on the Gallup-Healthways Well-Being Index, Texas residents had the 10th highest well-being in the nation. Texas residents were among the most likely to be content with their jobs and be motivated to achieve their goals, with the state ranking second in the purpose category, one of five elements of well-being in Gallup’s Index. Texans worked 36.3 hours per week in 2013, the most nationwide. This may reflect in part Texans’ motivation and workplace satisfaction. Texans were not especially healthy, however, with an obesity rate of nearly 31% in 2013 and relatively few residents reporting routine exercise. More than 22% of residents did not have health insurance in 2013, the worst rate nationwide, which may have made it more difficult for Texans than most Americans to get the medical care they need. Despite these poor physical health indicators, nearly 71% of adolescents in the state were vaccinated in 2013, one of the higher rates, and less than 16% of adults were smokers, one of the lower smoking rates reviewed.

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9. New Mexico
> Poverty rate: 21.9% (2nd highest)
> Unemployment rate: 6.9% (24th highest)
> Obesity rate: 26.4% (13th lowest)
> Poor mental health days (last 30 days): 3.7 (24th lowest)

Unlike most states with the happiest residents, a typical household in New Mexico had relatively low income in 2013, earning a median of less than $44,000. The median national household income was $52,250 that year. New Mexico also had an exceptionally high poverty rate, at nearly 22% in 2013, the second highest nationwide. While many New Mexico residents struggled with financial burdens, they tended to be in relatively good physical health. For example, the obesity rate of 26.4% was among the lower rates in the nation. Residents reported relatively few cases of high blood pressure and high cholesterol as well, which likely contributed to a lower incidence of heart disease. There were 147 heart disease-related deaths per 100,000 people in 2013, the 10th lowest such rate in the country. On Gallup’s survey, New Mexicans rated their physical health and habits fifth best in the country.

8. Utah
> Poverty rate: 12.7% (14th lowest)
> Unemployment rate: 4.4% (4th lowest)
> Obesity rate: 24.1% (4th lowest)
> Poor mental health days (last 30 days): 3.5 (18th lowest)

Utah is one of only a few states where less than one-quarter of adults were obese in 2013. Residents were also the least likely in the nation to report high blood pressure and high cholesterol that year. Utah residents generally reported healthy behaviors, which likely helped contribute to the good health outcomes and the state’s high well-being. Utah adults were the least likely to be smokers, with only 10.3% reporting the habit in 2013. Traditionally low smoking rates may have helped Utah residents stay healthy and out of the hospital. Between 2010 and 2012, there were less than 146 cancer-related deaths per 100,000 people, the lowest rate nationwide. In addition to strong physical health, Utah residents also liked where they lived, felt safe, and reported having pride in their community — the state ranked seventh in the nation in Gallup’s community element of well-being. Like most states scoring well in this category, Utah’s violent crime rate of 209 incidents per 100,000 people in 2013 was among the lowest in the country.

7. Nebraska
> Poverty rate: 13.2% (17th lowest)
> Unemployment rate: 3.9% (3rd lowest)
> Obesity rate: 29.6% (24th highest)
> Poor mental health days (last 30 days): 3.0 (6th lowest)

With an unemployment rate of 3.9% in 2013, the third lowest nationwide, Nebraska residents had the benefit of a relatively strong job market. Nebraskans were also more likely than most Americans to feel content with their jobs, rating their day-to-day contentment and motivation to meet goals — part of the purpose element of well-being — the seventh best nationwide. Workers also reported having just three poor mental health days per month in 2013, the sixth-lowest figure nationwide. While the median household income in Nebraska was slightly lower than the national figure, the cost of living was considerably more affordable than most states. As in most of the happiest states, Nebraska is also a relatively safe state. There were approximately 252 violent crimes per 100,000 people in 2013, one of the lower rates in the country.

6. Colorado
> Poverty rate: 13.0% (16th lowest)
> Unemployment rate: 6.8% (25th highest)
> Obesity rate: 21.3% (the lowest)
> Poor mental health days (last 30 days): 3.3 (11th lowest)

Colorado retained its 2013 standing on the list of happiest states, with a particularly high ranking in the physical element of well-being this year. The state had the lowest diabetes rate of all states, ranked second lowest in the percentage of the population with high blood pressure, and ranked third lowest in the percentage of residents with high cholesterol. The state also had the lowest obesity rate in the country, at 21.3% of the adult population. Residents were also relatively well-off financially. The state’s 2013 median household income of $58,823 was the 12th highest in the country. In addition, only 8.6% of Colorado households received food stamp benefits in 2013. Colorado households also had better access to services such the Internet, as 79.4% of residents reported having a broadband Internet subscription, the fourth highest percentage in the country.

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5. Montana
> Poverty rate: 16.5% (19th highest)
> Unemployment rate: 5.6% (14th lowest)
> Obesity rate: 24.6% (6th lowest)
> Poor mental health days (last 30 days): 3.3 (11th lowest)

As in most states with the happiest residents, Montanans were well educated. Nearly 93% had completed at least high school as of 2013, the third highest rate and considerably higher than the national rate of 86.6%. Montana residents were in exceptionally good physical health, which likely significantly contributed to happiness. Less than one-quarter were obese in 2013, for example, the sixth-lowest rate nationwide. Residents also had relatively low rates of diabetes and high blood pressure. Residents were not especially wealthy, however, earning a median household income of $46,972 in 2013, lower than the national figure of $52,250.

For the rest of the list, please go to 24/7WallStreet.com.

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