A report from Nerd Wallet. “On average, list prices fell 1% from the third quarter to the fourth, among the largest metro areas. However, some markets saw prices drop by double digits. Compared with the last quarter of 2020, prices fell double digits in 11 metro areas, with Detroit (-17%), Milwaukee (-15%), Los Angeles (-15%) and Pittsburgh (-15%) seeing the biggest drops.”
From Socket Site in California. “The sleek 653-square-foot unit #507 in the Rowan building at 338 Potrero Avenue features a wall of floor-to-ceiling windows with a Juliette balcony and city views. Purchased for $813,000 in October of 2017, the one-bedroom-plus unit has just been listed for ‘$695,000,’ a sale at which would represent a 14.5 percent drop in value for the unit since fourth quarter of 2017 on an apples-to-apples basis.”
From CBS Denver in Colorado. “In the last year, more than one third of all HOA foreclosure notices filed in Denver happened in Green Valley Ranch. There was no shortage of stories about people losing their homes to foreclosure after failing to pay fines levied against them by their HOA. ‘I’m homeless. I’ve never been late. This is what a citizen gets!’ exclaimed one woman.”
“Neighbors were able to speak with Denver City Councilwoman Stacie Gilmore about what they can do to save their homes from judicial foreclosure, and they gave her an earful. ‘A lot of our rights have been violated,’ Terry Meeks, a neighbor, told her. Meeks says she too has been getting an excessive number of fines from the HOA. Initially she paid them, but they kept showing up. She tried to ask why, but she says got the runaround from the board.”
“‘We would get all different type of answers. ‘They’re going to look into it. They’ve been resolved.’ Everything from not even being notified of violations and then you turn around and you have $3,000 or $4,000 fines. Then from $2,000 fines to right now $17,000 in fines,’ she said. She and many others think someone wants them out of their homes because of their race and the value of their homes. ‘It’s like another form of gentrification,’ she said.”
The Calgary Herald in Canada. “The 3,305 transactions last month were such a surprise even the Calgary Real Estate Board did not at first realize an all-time record had been set. ‘We just don’t typically see this activity at this time of year,’ says Ann-Marie Lurie, chief economist with the Calgary Real Estate Board. The previous record, set in March 2007, was 3,259 sales. ‘The other thing is there was a surge in listings, so we saw new listings also hit a record,’ Lurie notes. New listings increased more than 62 per cent, year over year, in February to reach 4,652.”
From Stuff New Zealand. “Andrew Harley and Bec Whitley are among the thousands who decided to try their hand at real estate during the housing price boom and now face a market downturn. Harley left behind a job as a business development manager for a fleet management company and Whitley used to be a teacher. Both are happy with the move, but say making sales has become harder since last year and both are bracing for a bumpier road ahead. They aren’t alone – Real Estate Authority data shows about 5000 people joined or returned to the real estate workforce in the last two years.”
“Harley, 42, says until recently all agents had to do was put out a sign and they would receive offers, but a slowing market requires sales skills and the ability to find a price buyers and sellers can agree on. Bec Whitley experienced the shift firsthand. ‘It was just crazy the last few months of last year, and more recently it’s definitely slowed down a bit,’ she says.”
“Martin Cooper owns 17 Harcourts franchises in north-west Auckland and the North Shore. Cooper expects the headwinds for the market to continue. ‘What we are seeing is a lack of FOMO from the buyers now.’”
The South China Morning Post. “Hong Kong’s home prices could drop 10 per cent in the first half, as the city’s worsening Covid-19 outbreak caused the first three months to be a washout for property sales, forcing analysts to reverse their forecasts. ‘With more projects competing for buyers in the second half, builders have to price their new projects at attractive prices to drum up sales,’ said Albert Wong, an honorary consultant at AA Horses Mortgage Brokerage Services, predicting home prices to tumble by up to 10 per cent in the first half of the year. ‘This will add further pressure to downward price adjustments.’”
“‘Owners who bought homes two or three years ago will sit on a paper loss, as home prices have retreated to the level of 2018,’ said Wong, a former deputy chairman of the real estate company Midland Holdings. He said home prices have been driven to unreasonable levels by the high selling prices of tiny flats in the past two years. Joseph Tsang, chairman of JLL Hong Kong, said some owners were selling their homes in desperation, worried that the escalation in infections may harm buying confidence.”
From News.com.au. “Mortgage holders have been dreading the day the Reserve Bank of Australia hikes up interest rates but they are underestimating how quickly it will rise – once the floodgate opens, an expert has warned.Back in February, the RBA assured Australians that it would be at least another six months before they lifted rates, saying they would need to see two more quarterly inflation reports. But last week, RBA governor Philip Lowe conceded that inflationary issues sparked by the Ukraine-Russia crisis could force him to bring up Australia’s interest rate much earlier than planned.”
“And now financial services group executive of comparison site Canstar, Steve Mickenbecker, believes that the main issue won’t be that interest rates have risen – it’s that once they do rise, they will continue to rise in quick succession. ‘An increase of 0.15 or 0.25 per cent doesn’t add much [to a mortgage],’ Mr Mickenbecker told news.com.au. ‘What people have to remember though is when the Reserve Bank moves [the cash rate] from the bottom, history shows there are usually six or eight increases within 18 months or two years. That puts a serious increase on your home loan repayment.’”
“The last time the RBA hiked up rates was in 2010. It has only been going down ever since. The official cash rate has been at a record low of 0.1 per cent since November 2020 in response to the Covid-19 pandemic but it is expected to jump by 1 per cent by the end of this year and hit 1.25 per cent next year. Although a 1 per cent rise sounds like a tiny amount, it could add hundreds or even thousands of dollars extra every month for the average Australian mortgage.”
“Mr Mickenbecker estimates that in the last half of 2023, the cash rate will hit 1.75 per cent, meaning the current average home loan rate of 2.95 per cent will jump accordingly to 4.72 per cent by then. Canstar analysis shows that for the past year and a bit, a borrower with a $1 million home loan has been paying $4189 every month, or $50,268 per year. If the cash rate rose in line with the Commonwealth Bank’s forecast and the average variable rate increased accordingly, their repayments could reach as high as $4822 in the next several years.In a 12 month span, a mortgage holder would have to fork out $57,864 – a difference of $7600.”
“That could spell disaster for an estimated one million Australian property owners who have never lived through a rate hike before as they have only recently entered the market during the turbocharged real estate year of 2022.”