There's time for one more wave before saying so long to summer and kicking into high gear for fall! 
Here's what to know and everywhere to go this month.

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Some designs are smart. Some designs are beautiful. Some designs are instantly ingrained in our lives. It’s the rare design that combines all three qualities, but the editors at Architectural Digest have managed to compile a list of buildings, objects, and innovations that do just that. 


See all of them here.

July Insights
July has arrived and alongside it all the best that summer has to offer. Enjoy! ​

This program helps you sell your home faster and for more money by covering the cost of services to prepare your home for market and increase its value. ​

Brenda Hayward
Estate Director | DRE#: 01502468
310.924.5352
brenda@compass.com

I have been a registered Independent for over 40 years. Although I voted for President, I did not vote for Trump or Clinton. I believe I am without bias.

I was Attorney-Advisor for Tax Policy to Treasury Secretary Simon during the Nixon Administration a Chair of the Tax Department at the 1200 attorney Paul Hastings law firm. I know a little about taxation and tax policy so I want to take this opportunity to objectively provide some thoughts on Tax Reform.


Tax Reform legislation will probably be enacted before year-end. It’s a very complicated (500 pages) transformational law – one that completely reshapes the tax code for the first time since 1986. As a Republican revision – it will probably pass the Senate with 51 or 52 Republican votes and no Democratic votes.  No normative judgment, just the facts.


Public support at 32% seems low.  That’s the same percentage as Trump’s approval rating. One reason might be that the legislation does very little for the “middle class,” with 62% of the economic benefits going to the top 1% of wage earners.


In 2018, tax savings will be low for most people - $1,000 to $2,000 – for the year. By 2019, the vast majority of people earning $200,000 or less will see their taxes increase. 6 of the 7 tax brackets will be lowered (including the top bracket from 39.6% to 37%) and the standard deduction doubled from $1,200 to $2,400, which will reduce the number of people itemizing their deductions from 19% to 5% thus “simplifying” the tax code. However, the “caps” on the deductibility of State and local taxes will offset the savings for individuals ($10,000), property taxes ($10,000), and mortgage interest ($500,000).


Individuals aside, corporate taxpayers will benefit from the tax rate reduction from 35% to 21%.  This will create an “asset bubble,” as many large corporations are already cash rich from earnings and borrowing is historically inexpensive. The lower rates will dramatically facilitate the repatriation of warehoused earnings from abroad (eg. Ireland).


One provocative question is the deployment of this multi-trillion dollar hoard of capital.  Will corporations reinvest it to expand business activities; raise wages; buy back stock; raise dividends; etc? And, why didn’t Congress take this opportunity to incentivize monetization to “Make America Great Again.”  What use will do the most good?


Whatever your view on the above, Tax Reform has a cost.  The estimates are between $1.5 and $2.4 Billion over the next 10 years, assuming the temporary benefits are allowed to expire.  Just like the Bush cuts in 2001 and 2003, the will not expire.


According to the Congressional Budget Office, the national public debt is at $15 Trillion.  That’s 77% of gross domestic product.  Think about that. What if 3/4th of your pre-tax earnings went to pay your bills?  Most people would not have any net income.


My opinion, for what it’s worth, is that this is a very bad law.

To get the in depth analysis, read below.

When you retire do you want to maintain your lifestyle or improve it, as your cost of living decreases?

I figured out a simple way to live better while doing less!
I’ve been doing so for almost 10  years now and I decided to share my very simple method with some friends.

8 to 10 years ago, I began looking for a safe place to “park” my money – to let it accumulate relatively safely while I prepared for the future.  The choices - <1% money market investments and anything interest rate sensitive with the inevitable spike in rates, not if but when - were (are) not attractive.

Then I realized  - OMG – I’m not only sitting in front of it, but I’m sitting in the middle of it – MALIBU REAL ESTATE!
The math (and tax consequences) are relatively simple:
The median price of a home in Malibu is $4,000,000, which you can buy with $1,000,000 down (conservatively).  You can borrow $3,000,000 at 3.375% (as of November 14, 2017) interest for 30 years, with taxes at 1.25% and insurance, the monthly cost is less than $20,000 per month.  (If you borrow “interest only, your cost drops to less than $14,000 per month.)

(FYI – Under the House tax bill, real estate investors are exempt from the limits on the deductibility of mortgage interest.  Taking advantage of this exemption may impact the ability to claim capital gain treatment upon sale, as noted below.)

You can rent the house for $20,000 (or more) and at least break even.  (With an interest only loan, you can put $5,000+ in the bank each month.)

If you assume 5% appreciation on your investment (the average appreciation rate over the last 10 years on real estate in Malibu has been 9.5%),  you more than double your equity in 5 years.

Tax free until you sell it and then, if you structure it correctly, capital gains.

Unfortunately for me – but maybe good for you – I see more opportunities than I can pursue.

Call me if you’re interested.    
Brenda Hayward, my partner, and I can find you a property and set you up with a lender.