It’ Friday desk clearing time for this blogger. “Homebuyer demand softened further over the last several weeks, according to Redfin. ‘Buyers are becoming more discerning. They’re less willing to overpay because now they’re only facing three or four competitive offers instead of dozens. Sellers may get frustrated if home-price growth starts to slow, but they should still be able to command excellent prices for their home as long as they price appropriately and put the work in to make their home as appealing as possible. This means staging, deep cleaning, a fresh paint job and landscaping—things that were not as necessary when the market was white-hot,’ said Redfin Los Angeles real estate agent Heidi Ludwig.”
“Rising interest rates and buyer fatigue are starting to show up in San Francisco’s real estate market, with agents saying that some buyers are opting out of the race. ‘Over and over we are hearing, ‘I don’t want to get into a bidding war’ when last month we had buyers happy to pay hundreds of thousands of dollars over asking price to secure a property before rates went up,’ said Compass agent Nina Hatvany. ‘Buyers are definitely experiencing fatigue from being outbid multiple times, and then the combination of a recent rise in inventory and rates has made them more discerning about what they are willing to ‘pay up’ for, and has caused some buyers to retreat to the sidelines to wait and see if something better comes along.’”
“‘I think the first-time home buyers are the ones that are impacted the most,’ says Steve Flach with the Fresno Association of Realtors. ‘They typically don’t have the wherewithal or the reserves to come in and guarantee cash above the appraised value or possibly waive appraisal contingencies.’ People ready to make the leap and buy a home are surprised to see how much mortgage interest rates have surged in the past two months. ‘It’s like they hear a barking dog, but they don’t really pay attention to it until it bites them on the leg and when they see that bite, they’re like oh my goodness,’ says Paul Salazar of Sierra Pacific Mortgage.”
“Buyers of a typical home in metro Denver faced monthly payments 21% higher at the end of March than was the case at the start of the year, according to Zillow. Going back a full year, would-be buyers in metro Denver are now paying 42.2% more, ahead of the 38% increase averaged nationally. As big as Denver’s monthly payment increase is, other areas are higher. Dallas, Phoenix and Atlanta monthly payments are up around 48% over the past year, while increases in Nashville, Tenn., Tampa, Fla., and Las Vegas top 50%.”
“If there is a plus side, it is that higher costs have reduced the competition and boosted supply. The inventory of homes available for sale in metro Denver grew 30.5% between February and March, according to Zillow.”
“According to Zillow, there are five major metropolitan areas in the United States where new homeowners are paying 50 percent or more on their mortgage than a year ago. Topping the list is Austin, Texas, where the current average monthly mortgage payment is $2,299. That is a 63.2 percent increase compared to the same time last year. The other places where plus-50 increases have registered are all along the southern portion of the U.S.: Raleigh (54.3 percent increase), Tampa (52.3 percent), Las Vegas (51.5 percent) and Nashville (50.4). The lowest mortgage payment increase in all 50 major U.S. metropolitan markets belongs to Baltimore, at 27.6 percent.”
“Michael C. Hall has just sold his West Village digs at a loss. The actor bought the two-bedroom, two-bathroom killer condo for $4.28 million in 2016. It just sold for $4.1 million, or a $180,000 loss, according to property records.”
“The deceleration in the Toronto-area real estate market continues as buyers and sellers come to grips with the most recent interest rate hike by the Bank of Canada. ‘I’m hearing a lot of ‘wait-and-see,’ says real estate agent Manu Singh of Right at Home Realty Inc. ‘They’re feeling a bit paralyzed.’ Investors who buy older condos and renovate them for resale can command a premium, but some of those are languishing longer than in the past, says Elli Davis, real estate agent with Sotheby’s International Realty Canada. ‘I think there’s going to be a drop in their expectations.’”
“Lenders to collapsed co-living company The Collective are likely to face losses running into the tens of millions, according to administrators to the company. A report released this week from partners at FTI, which is managing the administration of parts of The Collective group, said unsecured creditors to the company were owed as much as £66M. Those creditors are unlikely to receive a payout based on proceeds from selling the assets of the companies in administration, the report said.”
“Household applications for credit, which includes home loans, personal loans and applications to change power provider, dropped for the third quarter in a row, Equifax New Zealand managing director Angus Luffman said. In the first three months of the year, demand for loans was down 32 per cent compared to for the first three months of 2021, Luffman said. Applications for home loans was down 42 per cent.”
“Lyn McMorran, chief executive of the Financial Services Federation said the lending industry had been hit by a double-edged sword of higher living costs, and government red tape. Not only were lenders getting fewer applications, but more stringent responsible lending regulations had resulted in fewer applications being approved. ‘Lenders are seeing drastic reductions,’ McMorran said.”
“Chinese property shares have faced heavy selling pressure over the past two days as investors expressed discontent with the People’s Bank of China’s (PBoC) decision to put off an anticipated cut of the loan prime rate (LPR). The debt crisis of several property giants, not least Evergrande, has hurt homebuyer confidence, including concerns they won’t be able to receive their prepaid flats on time.”
“Last month, Chinese property stocks were under pressure after some said they would not be able to publish their annual results for 2021 as required by regulators by the end of March. Trading of these companies’ shares in Hong Kong were suspended from April 1. As of Thursday, six property developers including Evergrande and Sunac have still been unable to release unaudited results. Nine others have released their unaudited accounts while 23 have released their audited results.”
“‘For those developers that reported results on time, the overall performance was poor and missed the market’s and our expectations,’ said Lung Siufung, a property analyst at CCB International Securities. ‘Their core profit declined by 15% on average in 2021 and missed expectations by 20%, mainly due to slower sales and lower profitability.’”