It’s Friday desk clearing time for this blogger. “A unit at new-development condo Central Park Tower, the tallest skyscraper on New York’s Billionaires’ Row, has sold for $43 million, a discount of 32.5% off its original asking price. ‘They laughed at first,’ said James Michael Angelo, who represented her in the deal. ‘But we didn’t end up too far north.’ The unit is the latest at the megatower to sell for a significant discount from its original price. In May, another unit at the tower sold for $48.49 million, down from its onetime asking price of $65.75 million, records show. “
“The Seattle-area housing market continues to cool off. Median home prices around the region continue to dip. Since May, prices in King County have dropped 11%, or $109,000. Combine all this — prices, sales and how quickly homes fly off the market — and the Seattle area was cooling the fastest of any major housing market in the country in June, according to Redfin. Redfin deputy chief economist Taylor Marr predicts Seattle-area prices will continue to decline this year, though how dramatically depends in part on the rest of the economy.”
“‘Boise’s market is already turning around,’ said Boise Redfin agent Shauna Pendleton. ‘Sellers are asking me if the cash buyers from California are still around, hoping they’ll swoop in and offer to buy their home for more than the asking price–but that’s not happening much anymore, and the cash buyers who are in the market are often offering below the asking price. I don’t expect home values to plummet, but we do need to come down from the clouds at some point and sellers need to adjust their expectations to the new reality: There are more homes on the market, fewer buyers, and a higher chance that buyers can’t pay the asking price because their monthly payments have shot up due to rising rates.’”
“Denver’s July housing report shows the market is shifting away from a seller’s to a buyer’s market. Homebuyers who haven’t been able find a home will have an easier time now, as there were seven times as many homes in the market in July than at the start of the year, and twice as many since the end of April. ‘I think the name of the game right now is patience,’ said Andrew Abrams, chairman of the DMAR Market Trends Committee. ‘While the feeling is that things are slowing down – which is true – they’re not slowing down to a pace that’s going to like really shift the direction of the housing market and instead, it’s just going to be stable.’”
“‘We’re definitely not in a bubble we’re not going to crash,’ said Sindy Ready, treasurer on the board of the Arizona Association of Realtors. ‘Three months ago, we were at an inventory level of about 3,500 to 4,000 homes total in the market for the whole Valley, and that’s condos houses mansions, everything,’ she added. ‘We are up to as of this morning 18,700 homes on the market for the Valley.’ The price adjustment she says will give buyers more options.”
“‘We’re back into a situation where there may be some room to negotiate a little bit.’ Ready said, ‘In the old market a couple of months ago, every time a house sold the next one would sell another $10,000 higher, and then another $10,000 higher and it was going crazy.’”
“There’s no doubt about it; Central Florida’s housing market has shifted, according to Tansey Soderstrom, president of the Orlando Regional Realtor Association. The last two years were marked by rocketing house prices, bidding wars and historic sales figures. The peak of the market likely has passed, but that’s not necessarily a bad thing, Soderstrom told Orlando Business Journal. ‘That market was not sustainable. It was not a healthy market.’ Good listing photos, floor plans uploaded to MLS and proper staging are important practices Realtors should embrace again if they overlooked it during the frenzy, especially for pricier luxury homes, she said. ‘The market we were in the last 18-24 months, that didn’t matter.’”
“‘People are still moving in from California and they still have enough money to buy nice homes in desirable neighborhoods, sometimes with all cash,’ said Austin Redfin agent Gabriel Recio. ‘But the days of homes selling for 25% over asking price with multiple offers are over. Buyers are no longer as eager now that mortgage rates are up and there’s buzz in the air about the slowing housing market. Local buyers–and even buyers coming from out of town–now have a chance to take their time and buy a home at asking price or even under asking price.’”
“Q&A with Robyn Erlenbush, Broker/OwnerERA Landmark Realty, Bozeman, M.T.: When crafting a narrative, words are really important. We don’t talk about a market downturn or bubble; we refer to the shift in the market and what we’re seeing as a result of the shift. If a home is not getting showings, we talk about repositioning the home with new photos, new staging, and potentially a new price. The strategy is to keep the home from getting stagnant. This is important to keep sellers from panicking. There is no need to panic – we just need to be strategic. For example, a sound pricing strategy in today’s market is the practice of choosing relevant sales as far back as 12 months ago. This can help bracket this new market shift by showing a broader range of comparative pricing.”
“LGI Homes is a builder of single family homes across Western and Southeastern states and has benefited from the higher margins amid the COVID-19 induced housing demand boom. But those margins aren’t sustainable as demand for homes cools down and prices show signs of falling in some markets. ‘We will normalize our pricing. Yes, we will probably be selling the same floor plans in the future for less money than we were over the last 24 months. But it’s going to be similar to what it was two years and three years ago, because the last couple years are just going to be an outlier as far as [home] pricing goes,’ CEO Eric Lipar said.”
“Some firms will be forced to exit the mortgage industry as refinance activity dries up, according to Tim Wennes, CEO of the U.S. division of Santander. He would know: Santander — a relatively small player in the mortgage market — announced its decision to drop the product in February. ‘We were a first mover here and others are now doing the same math and seeing what’s happening with mortgage volumes,’ Wennes said in a recent interview. ‘For many, especially the smaller institutions, the vast majority of mortgage volume is refinance activity, which is drying up and will likely drive a shakeout.’”
“London’s real estate market fell off a cliff in July, the number of homes sold down by nearly half compared to the same month a year ago. The average selling price only fell by about $19,000 last month to $667,323, after eroding by $76,000 the previous month. July was the fifth straight month of declining average prices for homes in the London region that includes Strathroy, St. Thomas and portions of Elgin and Middlesex counties, with realtors selling only 514 homes. That’s 479 fewer homes sold than in July 2021, a drop of 48 per cent.”
“‘It feels like the taps kind of shut off,’ said Randy Pawlowski, president of the London and St. Thomas Association of Realtors. ‘There’s definitely some buyer’s remorse out there, too.’”
“A shift away from the rapid price increases of the past few years is well underway with home sales in both the Greater Toronto and Vancouver Areas dropping significantly. ‘The reality that Q1 pricing is long gone is now settling in for Canadians, as market psychology has turned dramatically,’ said Robert Kavcic, BMO Capital Markets senior economist. ‘Notably, more Canadians now expect prices to fall than rise over the coming months, a sudden turn from the raging self-reinforcing optimism seen through 2021.’”
“‘Although the housing market is only three months into a decline, the national Home Value Index shows that the rate of decline is comparable with the onset of the global financial crisis (GFC) in 2008, and the sharp downswing of the early 1980s,’ said CoreLogic research director Tim Lawless. ‘In Sydney, where the downturn has been particularly accelerated, we are seeing the sharpest value falls in almost 40 years. With fixed mortgage rates now up nearly three-fold from their lows and variable rates rising rapidly this has substantially reduced the amount new home buyers can borrow and hence their capacity to pay. As a result, the rug has effectively been pulled out from under the property market.’”
“What was once a river of cash has turned into a trickle as the property crisis Evergrande helped trigger has scared off buyers, with the revolt by mortgagors – sparked in June by buyers of an uncompleted Evergrande project – exacerbating the already crushing pressure on developers. The mortgagors are refusing to service the bank loans they took on to buy their apartments and the protest movement that started with the Evergrande development has now spread to about 320 projects across China.”
“Worryingly for the authorities and China’s banks, unpaid suppliers to Evergrande projects are also starting their own repayment strike which, if it were to spread as the mortgagors’ actions have spread, would amplify the financial and economic effects. Evergrande’s plight, already appearing hopeless, seems to worsen every time it provides an update.”
“Chinese developers – about 30 of the top 100 developers – have defaulted on about $US20 billion of offshore debts so far. Developments have been frozen, either incomplete or not even started and income from pre-sales has dried up. On Friday data on home sales by the top 100 developers was released that showed sales fell almost 40 per cent in July relative to the same month a year earlier and were almost 29 per cent lower than in June this year.”
“The mortgage boycotts, the sheer number of developments that have been frozen incomplete and the impact of China’s harsh ‘zero COVID’ policies on prospective borrowers’ incomes have gutted activity levels in the sector.”