A report from the Telegraph. “Brad Pitt is one of a number of wealthy Californians offloading property in LA in an apparent effort to save millions of dollars in tax. The rush of properties coming to market, and the tax, has depressed values and forced sellers to slash prices to get deals done. ‘The tax is affecting all high net-worth individuals,’ said LA luxury property agent Bryce Cooper. ‘In this market, people are selling at a loss, and even if you do, you have got to pay this tax. It’s catastrophic for some people.’”
The News Tribune in Washington. “Pierce County home prices continued to decline in March, according to the Northwest Multiple Listing Service. Pierce County’s median closed home sale price was $526,000, down 5.57 percent from the same time a year ago. King and Snohomish counties saw bigger percentage drops of more than 9 percent, with median closed price at $840,000 and $724,000, respectively. Kitsap County was at $517,500, down 3.9 percent from a year ago. In Pierce County, total active listings were up nearly 64 percent from March 2022, with more than 1,144 new single-family residential and condo listings.”
“Dick Beeson, managing broker at RE/MAX Northwest in Tacoma/Gig Harbor, said in the March report that buyers want to buy now because they see modest reductions in prices and rates. Meanwhile, he added, ‘Sellers want to sell now before prices fall even further and there’s less competition.’”
Forbes on Colorado. “In the city of Denver proper, home prices peaked in April 2022, when Denver’s median sale price reached an all-time high of $650,000. Since then, prices have declined steadily, so that by February 2023 (the latest data available at the time of publication), Denver’s median sale price was down to $556,125. Home prices in the Denver metro area also peaked in April 2022, reaching a median sale price of $615,000. From there, prices have gradually declined, reaching a median sale price of $560,000 in February 2023.”
“The city that experienced the biggest year-over-year decline in home prices was Berkley, a suburb northwest of Denver. The 12-month average median sale price in Berkley for March 2021-February 2022 was $545,150. It then proceeded to decline by 5.8% over the next year, falling to a 12-month average median sale price of $513,601 for March 2022-February 2023. Comparing monthly home prices year-over-year reveals an even steeper decline: From a median sale price of $602,000 in February 2022, Berkley’s median sale price had fallen to $350,000 in February 2023 — a one-year decline of 41.9%.”
From Urban Turf. “About out of every five homes to hit the market in DC this year has seen a price reduction, according to data provided to UrbanTurf by Bright MLS. However, in some neighborhoods, the proportion of listings with reductions is much higher. In more moderately priced areas on the east side of the city, like Deanwood, Fort Dupont Park and Woodridge, about 30% of homes listed in 2023 have dropped their prices, while in higher-priced areas, like Cleveland Park and Georgetown, that number is in the 10%-12% range.”
Mansion Global on New York. “Real estate deals plummeted across Manhattan in the first quarter of the year, with would-be buyers grappling with high mortgage rates and economic instability, according to a host of reports. Prices slipped 15% from the same time last year to a median of $1.02 million, the lowest figure since the property market paused during the onset of the pandemic in 2020, statistics from a separate report by Corcoran show. ‘In many instances, this is the moment buyers have been waiting for; sellers are finally getting realistic and Manhattan prices are the lowest they’ve been in years,’ said Pamela Liebman, Corcoran’s president.”
The Real Deal on Texas. “Commercial properties in the Dallas-Fort Worth region on lender watch lists have shot up by 33 percent since the start of the year, mostly stemming from the multifamily sector. A study by Steve Triolet of Partners Real Estate’s Dallas branch revealed that 113 of 450 commercial properties appeared on the commercial mortgage backed securities loan watchlist, meaning they have an upcoming maturity date, a major tenant moving out or another situation that calls for heightened attention, the Dallas Business Journal reported.”
“Retail came in second on the list with 98 flagged properties, followed by 69 for hospitality, 60 for industrial and 55 for office. As debt rates continue to climb and the banking industry is in flux, those figures are expected to climb. ‘The uncertainty of the banks is making any refinancing of debt more problematic,’ Triolet told the outlet. ‘So when you already have these properties that are subpar — particularly when I’m talking about Class C multifamily – it makes the owners and the banks nervous. The lender wants more money. They want the owners to put more cash into the property.’”
The Globe and Mail. “Canadian Mortgages Inc., CMLS Financial, New Haven Mortgage Corp. and individual private lenders are some of those who have turned down requests to renew some of their borrowers’ loans after home prices tanked over this past year. This is taking place in areas where home prices have dropped significantly. That includes Owen Sound, Bowmanville, Orillia, Timmins, Hamilton and Brampton in Ontario and Prince Rupert in British Columbia. Private lenders are nervous they won’t be able to recoup their capital if borrowers are unable to make their monthly payments. ‘Some homeowners are forced to get appraisals and the values are not coming in. It’s a mess,’ said Samantha Brookes, chief executive of mortgage brokerage Mortgages of Canada.”
“One of Ms. Brookes’s clients bought a property in Bowmanville in 2021. He is self employed and was not able to get a loan from a bank. He got two mortgages with two private lenders that amounted to $3,000 in monthly payments. He had been making his payments on time but his lenders said they were not willing to renew. Ms. Brookes said her client’s options are dismal. The loans are much more expensive and the monthly payments range from $7,400 per month to $8,600.”
“Other mortgage brokers are facing similar situations with distressed homeowners. Tuli Parubets said she got a call from a homeowner who had a property outside of Prince Edward County, a recreational region in Ontario where home prices nearly doubled in the first two years of the pandemic. When the homeowner first took out the loan, it had a 65 per cent LTV ratio. She was paying an 8.99 per cent interest rate on her mortgage. Now that home prices have dropped, the LTV has jumped to 80 per cent. The private lender is refusing to renew and Ms. Parubets said her client has scant options. ‘She doesn’t have a lot of recourse,’ said Ms. Parubets, a mortgage agent with the Mortgage Scout. ‘If you sell, you’re not getting any money out of this property.’”
“If the value of property dropped by 20 per cent – as it has in many places in Canada – the value of the property is now $400,000. That means the loan now accounts for 94 per cent of the property’s value. ‘You are going to see borrowers left in the lurch where nobody will take them because everyone’s guidelines say they won’t go over 75 per cent LTV. So if you are over that, you are untouchable,’ said Laura Martin, chief operating officer of mortgage brokerage Matrix Mortgage Global.”
Blackburn News in Canada. “The Windsor Essex County Association of Realtors said 417 homes changed owners last month, compared to 717 in March 2022. That’s a drop of 41 per cent from a year ago and 44.1 per cent so far this year. Those who braved the market got more, on average, for their property than in February. The average housing price climbed 6.6 per cent from the month before but fell from $720,567 12 months ago to $568,204, down 21.4 per cent. Prices have slid 22.6 per cent in the past year.”
The Aldergrove Star in Canada. “The real estate market in Langley and its neighbours has picked up, but is still well below long-term averages when it comes to sales, according to the Fraser Valley Real Estate Board. Some properties are staying on the market for a long time, as the owners have listed them at higher prices. While they might have gotten a sale a year ago, now it isn’t happening. ‘Buyers are really savvy,’ said Bettina Reid, a Langley-area realtor. ‘They’re not willing to overpay for a property.’”
“The benchmark price for a detached house in Langley was $1.485 million, up 1.2 per cent from $1.467 million in February. That’s down a whopping 21.2 per cent from the same month a year ago, when houses were selling for about $1.88 million. A benchmark townhouse sold for $796,400, down 0.6 per cent from February’s $801,000, and down 12.1 per cent year-over-year. Condos were going for $565,300, up 1.3 per cent from February, but still down 12.4 per cent from the same month last year.”
From NL Times. “Sales of new construction homes fell by half in the last quarter of 2022 compared to a year earlier, Statistics Netherlands (CBS) said this week. This is the largest decrease since the statistics office started tracking the figure in 2015. The number of transactions for new-build homes fell at an increasingly rapid rate over the course of 2022. In October, November and December, for example, Statistics Netherlands counted just over 5,300 new-build homes sold. That is almost 51 percent lower than in the fourth quarter of 2021. Real estate association NVM reported an 8 percent fall in average sales prices of existing homes during the first quarter of 2023, and a near doubling in the number of properties on the market.”
“Housing Minister Hugo de Jonge said the problem is not only rising interest rates, but also that housing prices have not yet fallen enough. New construction projects are at a standstill. The current interest rate ‘is not crazy,’ but it rose quickly in a short period of time. ‘Then you get an interest rate shock: both buyers and investors sit on their hands. You cannot solve this with money from the government alone. A correction must be made to the price,’ De Jonge said.”
The Cryptopolitan. “South Korean authorities have taken action to stop Do Kwon, the founder of the now-collapsed cryptocurrency issuer Terraform Labs, from withdrawing his crypto holdings. Prosecutors have requested that Binance, the world’s largest exchange, block any withdrawal of crypto assets owned by the disgraced crypto figure. The move is part of the ongoing investigation into Terraform Labs, which collapsed amid allegations of fraud. Prosecutors estimate that nine executives made a total of 414.5 billion won ($315 million) from the enterprise, with Kwon’s involvement alone being $69 million.”
“Prosecutors are actively tracing properties associated with Terraform Labs executives to recover some illicit funds from the Terra debacle. The property freeze process is the first step towards recovering the proceeds of crime. Prosecutors applied foreclosure not only on apartments in Seoul owned by former co-CEO Shin Hyun-seong and others, but also lands in Hwaseong and Gapyeong in Gyeonggi-do, Taean in Chungcheongnam-do, and foreign cars they drove. It is to prevent them from selling or stealing during the trial.”
The Phnom Penh Post in Cambodia. “Prime Minister Hun Sen on April 8 called for a moratorium on housing foreclosures and arrests of ‘needy’ borrowers of loans from banks and microfinance institutions (MFIs), given the current economic environment. Speaking at an event at the Koh Pich Convention and Exhibition Centre, the premier seemed to rule out a large-scale interest freeze.”
“‘Interest will pile up for those borrowers who have the money but refuse to pay them [the financial institutions] back. So, if you have the money, pay them back,’ he stressed, expressing appreciation to formal lenders for their positive contributions.”