A report from the Sun Sentinel. “Businesses tied to the real estate industry say they’ve started to feel the effects of the housing market slowing down in South Florida. ‘It’s a ghost town,’ says Bruce Gubnitsky, the owner of BG Appraising and Consulting, of the ‘steady decline’ in business. ‘This is the third or fourth time that I have seen this happen,’ said Adam Zipper, with Strock & Cohen, Zipper Law Group. ‘It’s the ebb and flow of the business. We had a few years of unsustainable increases and now we are seeing unsustainable decreases.’”
Fox 13 in Florida. “Big changes to the federal interest rate rocked Tampa Bay’s housing market over the last six months. Realtor Amy Heckler said she’s noticed the market turn on its side. Heckler said it’s like someone flipped the switch on real estate. ‘So it’s definitely gone from one extreme to another almost, and we’ve seen quite a change in the market,’ she explained. ‘None of us have a crystal ball, however, we do and have seen the prices drop dramatically.’”
Boston 25 News in Massachusetts. “One Boston-based realtor says things are looking a lot better for prospective home buyers. ‘We’re seeing a lot of inventory come on the market. There’s definitely less closing and more properties that are not going under agreement,’ realtor Mike Urban said. ‘Now you can really negotiate the sale price down.’”
The Longview News Journal. “The East Texas housing market is changing as interest rates have climbed., ‘I think it’s kind of leveled off to the pre 2020-21 market,’ said Jessica Holmes, chairwoman of the Longview Area Association of Realtors, adding that the past 18 months have been ‘good for buyers.’ Every home that went on the market had multiple offers, with offers above asking prices and cash offers common. Sellers, though, are wondering why their homes are still on the market after a couple of weeks. She said in the past two years sellers weren’t having to reduce prices.”
“‘Now, I’m seeing price reductions,’ along with more incentives, such as help with closing costs, Holmes said. Homes generally are selling for listing price or less, she said.”
From Realty Biz News. “The real estate market has been a challenge to navigate during the past few years, and New Jersey is no exception. Housing prices are gradually starting to come down, as the market transitions from a seller’s market to a buyer’s market. Prospective home buyers no longer feel the urgency to make high offers on houses before they are snapped up. Real estate analyst Dennis Lynch has noticed home sales have fallen significantly during the past year.”
“Alpine has the largest available housing supply compared to any other town in the state. Alpine is estimated to have nearly a year’s worth of inventory on the market. Several other townships have large inventories of houses available. For example, Loveladies also has nearly seven months of inventory available. In addition, both Saddle River and Far Hills have more than five months of supply available. According to Lynch, one of the side effects of increasing interest rates is that foreclosures will go up as well. Some people may have taken out adjustable-rate mortgages—as a result, the interest rates on their mortgages might begin to go up, and they might be forced to foreclose on their homes.”
“In August, New Jersey had the fourth-highest rate of foreclosures in the country. Some housing markets most vulnerable to foreclosures include New York and Philadelphia suburbs; this includes Passaic, Camden, Gloucester, Bergen, Essex, and Sussex counties.”
Bisnow New York. “Inflation, interest rates and a very cloudy view on the return to offices mean the nation’s biggest landlords are navigating how to run their properties with little to guide them, all while battling dipping values and a perception problem. ‘There’s very little new stuff coming to the market,’ Savanna Managing Partner Chris Schlank said. ‘On the office side, any office building that comes to market now gets punished, because anybody that brings an office building to market now, the market perceives as distress. There’s an upside-down capital market there.’”
“Even market-rate apartments in a supply-constrained market, where landlords can feel confident that rents won’t bottom out, Meridian Investment Sales Executive Managing Director Helen Hwang said the market is still a starkly different environment from the start of the year, when buyers were accepting capitalization rates below 4%. ‘What is really shocking is, we took a survey in first quarter of this year and there was so much optimism and the investor psyche was totally different,’ she said. ‘It was a different world then. Fast-forward to today, and rent growth is so muted and basically just matching expenses.’”
“CBRE Investment Management Senior Managing Director Sondra Wenger said there is capital on the sidelines for both debt and equity — it is just unclear when exactly they will get back in the game. ‘There’s no liquidity crisis,’ she said. ‘There’s a great pricing restructuring that we’re all having to sort of swallow. And I think that’s the real challenge. What we’re struggling with on the office front is just transparency of return to office.’”
From Market Watch. “Well, technically — the National Realtors Association (NAR) said it’s expecting the commercial real-estate market to experience a ‘slight decline in prices’ in 2023. ‘Nationwide, we are beginning to see some decline in commercial appraisal values,’ Lawrence Yun, chief economist at NAR, said over the weekend. ‘Cap rates simply cannot match up with higher borrowing costs, especially among people who need to refinance their properties.’ ‘Offices are the most vulnerable to these price decreases,’ Yun said. ‘We are seeing a rise in office vacancies in many cities, driven by a preference for remote work,’ he added. Before the pandemic, San Francisco saw an office vacancy rate of just 6%, he noted. Now, it’s more than 15%.”
“According to Green Street’s commercial property-price index, rising rates have pushed property prices down by 13% from a peak this year. ‘It’s a simple story: higher yields on Treasury bonds equals higher cap rates,’ said Peter Rothemund, co-head of strategic research at Green Street. Offices saw a drop in prices of 17.5%, the company said in its report. ‘And as large as the decline in pricing has been, I don’t think we’re out of the woods,’ he added. ‘If the 10-year note stays above 4%, property prices are likely to keep falling.’”
The Globe and Mail. “Private mortgage lenders are having a harder time accessing capital and are making it more difficult for borrowers to get a loan, choking off a major source of funds for those unable to qualify at a Canadian bank. Some private mortgage lenders, also known as alternative or subprime lenders, are requiring borrowers to have higher down payments or more equity in their homes to qualify for a private mortgage. The higher standards are being rolled out as Canadian banks clamp down on lending in the face of falling home prices and rising interest rates. That has sent a flood of new borrowers to private lenders and shored up their business.”
“As a mortgage investment corporation, or MIC, the lender uses capital from investors, as well as funds that have been repaid by its borrowers to provide new mortgages. ‘When we need capital, we don’t just go down to the trading floor and organize an extra billion dollars. It’s all directly from private clients,’ said Rob Pirie, MCF Mortgage’s chief executive officer. ‘Sometimes we just run out of capital, it just takes a few weeks or a month to sort of build that new capital up. It’s not anything that was concerning at all.’ The two-week October suspension was only its second suspension in nearly five decades in business.”
“Home values have lost at least 20 per cent of their value in areas that appreciated the most, including Toronto suburbs and smaller cities in Southern Ontario.”
From Mansion Global. “The U.K.’s property market isn’t coming back to Earth, it’s plummeting back to Earth, according to a report Monday from Rightmove. The frenzied market of the past two years has turned into a more normal market more abruptly and less smoothly than we were expecting,’ Tim Bannister, Rightmove’s director of property science, said in the report. Looking ahead, ‘the plethora of predictions about what might happen to prices next year comes at a time when much is still uncertain,’ Mr. Bannister said. ‘But what is certain is that the exceptional price growth of the last two years is unsustainable against the economic headwinds and growing affordability constraints.’”
The NL Times. “Recently, people buying a home in the Netherlands have become less prone to bidding above the seller’s asking price, said the large online broker Makelaarsland. The situation has begun to return back to the level of 2018, which is another signal that the housing market in the Netherlands is rapidly cooling down. About one in three bids was above the asking price, at Makelaarsland last month. By comparison, in the first half of this year more than three-fourths of all bids were still higher than the seller was seeking.”
“‘In terms of figures, it has been a long time since such a situation has occurred,’ said Makelaarsland director Gijs van Wijgerden. ‘The year 2018 was the last time that we had to deal with these kinds of percentages. At the time, the percentage of bids above the asking price was slightly lower at 30 percent.’ Earlier figures showed that housing prices have been falling in recent months. At the beginning of this year, the largest price increases in decades were measured. The reason for the turnaround are the rising interest rates, which means that buyers are no longer able to obtain higher mortgages.”
“Van Wijgerden of Makelaarsland tried to reassure people. ‘You can wonder whether the current hysteria in the housing market is justified. 2022 was not a bad year if you look back further than 2021. That year was extreme; this year the market is stabilizing again,’ he indicated. ‘It seems that buyers and sellers are getting used to a new reality in the housing market and that they are leaving the craziness behind a bit.’”
From Reuters. “The New Zealand house price index saw its largest drop in 30 years last month and sales activity was particularly soft, fuelling expectations that prices might fall further than many economists had previously forecast. The house price index, which measures changes in house prices on a like for like basis, fell for the 11th consecutive month and is now down 10.9% on October last year, according to data released by the Real Estate Institute of New Zealand on Tuesday. The median house price was down 7.9% on October last year. House prices in New Zealand rose roughly 40% over the pandemic before peaking last November.”
The Daily Mail. “Devastated Australians say they have lost everything after investing in cryptocurrency with some seeing their marriages break down and others left contemplating suicide as a result. Another Aussie said: ‘I had 95% of my life savings in Celsius as I was made to believe that it was a safe and secure account where I could earn 1% interest on my bitcoin. I have suicidal thoughts and the only reason I hadn’t already taken my life was the burden that would leave my family. I have lost 15% of my body weight in 6 weeks from the stress of suddenly losing everything that I’ve spent my entire life building. Worst of all, my mother split my home with me so if I default on the home she’ll be homeless at 60 years of age. I just don’t see a way where I can recover.’”
“A 40-year-old father-of-three added: ‘This has had an immense impact on my life and my financial future looks extremely grim. ‘I feel humiliated, angry, anxious and have had many sleepless nights coming to the realisation the all my funds I have been saving for my children’s future for the past 20+ years has been gambled away by a liar and a fraud.’”
“While a 42-year-old single parent said: ”The plan was to work a ridiculous amount of hours and live in a very cheap run down property to maximise savings. The end game was to buy a house for myself and my child. I have no family over here and nobody to fall back on so I had to come up with a plan. I have lost everything. How can I explain this to my son? I feel ashamed at myself.’”
From Bloomberg. “In hindsight, Sam Bankman-Fried’s April interview with Bloomberg’s Odd Lots podcast was a harbinger of his epic collapse last week. He described a ‘box’ that has value only because other people put money in it, and, when confronted with the idea that he described a Ponzi scheme, admitted there was a ‘depressing amount of validity’ to that.”
“As for Serum, it and other crypto projects are a long way removed from the ‘summer of DeFi’ that it declared in a white paper around mid-2020. That was just as digital assets were on the brink of an epic boom that spawned Super Bowl ads, stadium naming rights and crypto bandwagoners who were all-too-eager to tell non-believers to ‘have fun staying poor.’”