A report from Community Impact in Texas. “Median home prices in Northwest Austin are down $67,000 from July to August, according to the Austin Board of Realtors monthly report released on Sept. 15. August median home prices stood at $577,000, compared to $644,000 in July and $617,500 in June. ‘The cost of developing and building homes in Austin continues to escalate with little to no relief. This will cause sales to slow, as we see currently with home prices dropping and selling closer to the list price when compared to the past two years,’ ABoR President Cord Shiflet said.”
The Sun News. “A year after that peak of home selling, Myrtle Beach’s real estate market has finally started to cool off. ‘It’s 100% different than it was three months ago or four months ago,’ said Renny Diedrich, South Carolina Association of Realtors’ vice president over Myrtle Beach. ‘It is a more normalized market. The last two and a half years was something that we never experienced.’”
“Century 21 real estate agent Greg Harrelson said he first noticed a change at the start of the year. ‘Before you see a shift in the data, you’ll see a shift in conversations,’ he said. Suddenly, buyers were sounding more frustrated. They were ‘fed up with having to pay more and more,’ Harrelson said. They complained about the multiple-offer bidding wars, paying $30,000 over asking price.’ ‘The buyers felt bullied,’ Harrelson said. Whereas, ‘at the height of the market, people were saying, ‘Find me something. I’ll pay anything,’ he added.”
The Center Square. “A new analysis of listings on Zillow has found that the housing market in Illinois is cooling off. Mortgage interest rates have now risen to 6%, high enough to push a lot of buyers back down to earth. RubyHome, the luxury California brokerage firm that examined 12 months worth of Zillow sales, put Illinois at number 9 on their top 10 list of states where sellers are walking away with less than their asking prices. ‘People may have been asking very unrealistic prices,’ said Daniel P. McMillen, professor of finance at the University of Illinois-Chicago.”
The Colorado Springs Business Journal. “The real estate market in Colorado Springs — and statewide — showed growing buyer power, the impact of rising interest rates, and a slowdown during August, according to a report out today from the Colorado Association of Realtors. The number of homes sold in the Springs market was also down 30 percent year over year and inventory was up 102.9 percent, said Patrick Muldoon, a Springs-based Realtor and spokesman for CAR. The market has quickly reversed from excess demand and a shortage of inventory in early 2022 — a feature of the pandemic — to the opposite now, where ‘we have inventory, but demand is gone,’ Muldoon said.”
“‘… Colorado continues to be one of the states making news on being unaffordable and in a housing bubble, and we are beginning to feel that as sellers either remove their homes from the market, or price drop.’ Muldoon said as this trend continues, rent prices in the area will also ‘soften.’”
From Tucson.com. “A combination of factors could finally slow the rapid increases in the cost of buying a home in Arizona. Doug Walls, the labor market information director for the state Office of Economic Opportunity said Thursday that the number of homes on the market in Arizona hit 23,719 last month. That’s up 12.9% from the prior month and more than double a year ago.The figure, which represents both new homes and those being offered up by owners, also is the highest it’s been since the middle of 2019.”
“Add to that the fact that the number of days the typical home is on the market increased to 41 days in August from 32 days in July. Then you have the Federal Reserve Board which continues to increase interest rates, making it more expensive to borrow. Walls said the most recent month-over-month increase was the largest going back to December 1986. And the largest losses came in the state’s financial activities sector which shed 800 jobs in the past month. That’s the polar opposite of the long-term trends in the industry, which normally gains 800 jobs in August.”
“Those losses include not just positions in real estate but also a category called ‘credit intermediaries,’ the people involved in arranging financing. And it reverses strong gains as the state and nation were coming out of the pandemic.”
From DS News. “The Five Star Conference and Expo 2022 opened Sunday in Dallas at the Hyatt Regency Dallas, getting underway with the FORCE Membership Group’s New Member Mixer, welcoming agents and brokers. The FORCE Advisory Council is tasked with expanding FORCE’s influence guiding all members in forging productive and meaningful relationships with lenders, servicers, REO and distressed asset management companies, and investors.”
“The moderator started the panel off by asking the most frequently asked question they received from audience submissions: ‘When are the listings coming and what are the signs?’ ‘I believe that we will have increased foreclosure in America into 2026,’ noted James Hastings, Chairman of the FORCE. ‘When you look at the data, it should not be a surprise, so I think we’re going to have a good five years.’”
The Los Angeles Daily News. “California cities are leading a brewing cooldown in home prices nationwide. Source: My trusty spreadsheet analyzed two recent home price reports: Black Knight’s report on median sales prices for July in 50 big U.S. markets, and Case-Shiller’s price indexes for 20 metro areas for the three months ended in June, which tracks price changes of individual homes sold. Neither of the valuation math was kind to California. Six California markets ranked among the worst performers in Black Knight’s tracking of price falls from springtime peaks. Case-Shiller found six down markets nationally for June — three in California.”
“Why are the 10 markets with the biggest slips tracked by Black Knight and all six decliners from Case-Shiller located between the Pacific coast and Denver? Simply put, this year’s soaring mortgage rates and rising consumer anxieties have shaken the foundation for the sky-high home prices of the pandemic era — especially in California. Consider Black Knight’s math: San Jose:July prices were 10% off their peak (the largest dip of the 50 metros). San Francisco:7% off the peak (No. 3 dip). San Diego:6% off the peak (No. 4 dip). Los Angeles-Orange County:4% off the peak (No. 5 dip). Sacramento:3% off the peak (No. 7 dip).”
“On a scale of zero bubbles (no bubble here) to five bubbles (five-alarm warning) … THREE BUBBLES!”
The Toronto Star in Canada. “The city’s red hot housing market has lost a little of its frenzy over the past few months. What’s out there in the city core for at or about $1 million now vs. at the height of the market this past winter? At the height of the market this past winter it was tough to find even a semi-detached or row house for under a million that was move-in ready, let alone a detached home, in urban Toronto, said Ara Mamourian, broker of The Spring Team Real Estate.”
“‘There’s been a bit of an adjustment,’ Mamourian said. Homes that were maybe not even newly updated but safe, livable and in the urban neighbourhoods of Toronto, were going for up to $1.1 to $1.2 million in January, February, and early March. ‘Now you’re getting those homes at up to $1 million,’ he said.”
“According to TRREB’s most recent stats, the average price for homes and condos was $1.08 million in August. That’s up slightly from July’s average price of $1.07, but down from February’s $1.33 million. Andrew Harrild, co-founder of Condos.ca., said he’s seen this price drop trend even in ‘prime triple A neighbourhoods’ such as Leslieville. Although there have been price drops across the board of around 10 per cent since February, condos are in general ‘holding up better,’ said Harrild. ‘If you’re one of a dozen condos on the market, just like yours at the same time, well, how do you separate yourself from your competition? You’ve got to reduce your price, that’s how you do it.’”
The Globe and Mail. “Real estate flippers have made out like bandits in Canada’s red hot real estate market over the past two years. But with today’s slower sales and house prices dropping rapidly, it’s time for a reckoning. ‘Just as some people bought not knowing that they were going to finish their flip in a really, really profitable seller’s market, others bought at high prices at the tail end of this surge and the market flattened on them,’ says Matt Francis, a realtor in Stratford. ‘If they entered that flip with the mentality of putting all their eggs in one basket and having to sell it for a high price, then they’re in trouble.’”
Stuff New Zealand. “Move to Christchurch and we’ll pay your mortgage for a year. That’s the promise of housing development company Brooksfield to anyone who shifts to the city and buys one of its townhouses by the end of October. The only condition is the mortgage must be for a 30-year term, at a current average bank interest rate. Brooksfield director Vinny Holloway said the slowing real estate market had almost halved their sales since the peak last year. A year ago, they were selling about 40 homes a month, ‘and we could’ve sold almost double that if we had the stock. They were just flying off he shelf.’”
“Now they are selling between 20 and 25 homes a month, he said. ‘And we’re having to work for those.’”
The Korea Times. “A string of economic indicators in Korea this year have worsened to levels comparable to the 1997-98 Asian financial crisis and the 2008-09 global financial crisis, raising questions on whether the country is on course for another crisis after overcoming painful shocks from the two preceding ones. For instance, there was a striking sense of deja vu when some of this year’s financial statistics were released. Inflation hit 6.3 percent in July ― the highest since November 1998 when it reached 6.8 percent. Also, the Korean won-dollar exchange rate closed at 1,393.7 won on Sept. 15, the highest since 1,422 won on March 31, 2009. Foreign reserves dropped by $9.4 billion in June, the deepest fall since November 2008 ($11.7 billion). And in August when the country faced the fifth consecutive month of trade deficit, it echoed the longest losing streak in the trade balance seen in April 2008.”
“Of more concern is that the risks have emerged simultaneously ― a rare scene compared to the past ― and are thus amplifying jitters over the economy. Of course, some indicators ‘deserve very close attention,’ according to Jun Kwang-woo, a former Financial Services Commission (FSC) chairman who heads the Institute for Global Economics, as they highly reflect the impact of the external risks that remain out of Korea’s hands. They include the negative trade balance, which is highly associated with China’s unprecedented growth slowdown.”
“‘The Chinese economy was enjoying a boom during the past two crises that many are concerned about to date,’ Jun said, adding that Korea’s recovery back then was attributable to China’s growth and that losing such a plus factor would not go unnoticed.”
From Reuters. “Two months since many Chinese homebuyers stopped repaying mortgages to protest stalled construction on their properties, a lack of progress at more sites now threatens to intensify the boycott, despite assurances from authorities. With no sign of construction picking up at many projects and no clear guidance from local authorities, more homebuyers have told Reuters they plan to join others who have stopped paying mortgages. ‘The government is focusing on social stability and has not thought about solving the problem of unfinished projects,’ Qi Yu, a homebuyer in the southeastern city of Nanchang, said. ‘There’s nothing we can do if the government doesn’t help us.’ Qi has not serviced his 1 million yuan mortgage since July.”
“Others say they have been forced to stay silent amid a crackdown on dissent. In Zhengzhou, 30-year-old Ashley, who only gave her first name, said while construction resumed at her apartment in the second quarter, only a handful of people work at the site to, what she believes, ‘appease homeowners.’ Ashley told Reuters she and other homeowners of the development were warned against travelling to Beijing to protest after the Zhengzhou government repeatedly cancelled meetings with homebuyers.”
“‘I received a call from the police this week, they asked me not to get around them to protest to higher authorities,’ she said. Ashley showed Reuters a phone log that police had called her 15 times in one day earlier this month. Zhengzhou Public Security Ministry declined to comment.”
“About 2.3 trillion yuan (US$43.02 billion) worth of loans is at stake if all unfinished projects ended up in mortgage boycotts, representing 6 per cent of total mortgages, Natixis said in a report last month. Beijing has set up a bailout fund worth up to US$44 billion and US$29 billion in special loans for unfinished projects to restore confidence, sources say. Sources at property developers and banks, however, said it could take time for those funds to make a difference. ‘There won’t be money for everyone,’ said a senior executive at a Shanghai-based developer.”