A report from the Columbia Business Report in South Carolina. “Residential real estate in South Carolina enjoyed a positive 2019, and realtors expect the growth to continue through the early part of 2020. ‘Overall, people are making more money (and) houses are selling faster, in a shorter amount of time. I will say buyers are taking a little bit more time to buy a house, but overall, it’s going well,’ said Brad Allen, broker-in-charge at Art of Real Estate in Columbia. What also helps the market are low interest rates and potential buyers getting financing, insiders say.”
“‘I’m seeing lenders e-mailing almost weekly or monthly saying ‘We can take lower credit scores now,’ Allen said. ‘There’s less down payment. There are programs that are coming out that require no down payment at all. So I think it’s as easy as it has ever been to get a mortgage.’”
The Roanoke Star in Virginia. “Despite recent headlines speculating on the probability of another housing bubble, Virginia’s robust demand and limited supply—fundamentals indicative of a healthy economy—are the driving forces behind the rising prices. ‘While home prices have reached the peak levels seen during the height of the housing boom, there is no evidence of a bubble because price appreciation now is much more modest,’ says Virginia REALTORS Chief Economist Lisa Sturtevant, PhD. ‘During the housing market boom of the middle of the last decade, the double-digit price growth was driven by other factors–particularly loose lending requirements–which are not present now.’”
From C & G Newspapers in Michigan. “Good news: 2020 is looking like another fabulous year for both commercial and residential real estate purchases. But it won’t be quite as fabulous as 2018 or 2019. Coldwell Banker Weir Manuel CEO John North assured forecast guests that the housing market in Oakland County is still thriving. ‘The numbers are good; 2018 versus 2019: up, up, up. Everything is looking good. A little variation as you start to spread out across the county. That’s very normal,’ he said.”
“Sometimes good news can be too good. North was asked if the thriving markets could be described as experiencing a bubble, similar to what led to the last recession. North was quick to quell that suggestion. ‘I’m not a big believer that we’re in a bubble of any sort as it relates to real estate, residential or commercial. I believe due to a lot of the changes that were made during the last downturn, and I think most experts believe, that if we have a recession, it would probably be short lived, and certainly there’s no indication that housing will play any role in leading us into it like it did in the past one,’ he said.”
The Star Tribune in Minnesota. “Being a 26-year-old Minneapolis native who has lived in San Francisco and now lives in Brooklyn, N.Y., I often look at home prices in the city I grew up in and imagine making the move back to own my slice of the American dream. I rationalize this fantasy by telling myself the Twin Cities are one of the last urban areas where real estate is still available to the middle class. Only, it’s becoming less possible by the day. One two-bedroom, two-bathroom Minneapolis house I saw on Zillow had skyrocketed in price in just over three short years — from $250,000 in 2016 to $345,000 in 2020.”
“I thought about writing this while walking the span of Central Park South known as Billionaire’s Row, an imposing stand of glass super-talls that are owned by the hundred millionaires and billionaires among us. Most of these units stand unattended by their owners, empty palaces in the sky. Where shortsighted thinking is taking precedent to reason and sanity in the name of fast dollars for the few. A place natives might soon be forced to move on from, and where firms with the most capital to develop vapid ‘luxury’ units become our slumlords.”
“What’s going on in the Twin Cities may not be the product of fraud. But it seems to be the product of greed and a lack of attention to Minnesota’s once-great middle-class standard of life.”
From Boston Magazine in Massachusetts. “When it comes to the area’s sky-high real estate prices, ‘We’re in extra innings right now,’ says Dana Bull, of the North Shore’s Sagan Harborside Sotheby’s International Realty. ‘It doesn’t make any sense how it continues to go at the rate it’s going.’ That said, buyers have started to pump the brakes, and Bull predicts that will continue into the foreseeable future.”
“Across Greater Boston last year, the median price of a single-family home increased only half as much as the previous year—a phenomenon Sagan agent Matthew Dolan attributes to house hunters tiring of bidding wars that drive prices over asking. ‘At some point over the last year, buyers just said, ‘Hey guys, you’re trying to get too much money now, and we don’t see [the value],’ he says. ‘We’re here, we’re ready to buy, but you guys are taking it too far.’ If nothing else, 2020 may be the year buyers can have at least 24 hours to put in their offer before their dream home gets snapped up.”
The West Side Rag in New York. “While Upper West Side home prices are still astronomical based on most metrics, they’ve been dropping in the past year, according to Streeteasy. Sales prices have fallen and homes are staying on the market longer. Sales Prices are at $1,098,267 (down 2.9% from last year) and the lowest level since 2015. 12.4% of homes on the market had a discount in January. Homes lingered on the market nearly two weeks longer for a total of 117 days – last year it was 104 days.”
“‘Upper West Side home shoppers are currently in the driver’s seat,’ said StreetEasy economist Nancy Wu. ‘More and more homes are coming onto the market, which means that sellers here are facing stiffer competition to stand out. This is good news for buyers, because they now hold the negotiating power, and can afford to be picky during their home search.’”
From Mansion Global on California. “The long-time Palm Springs, California, home to the late Jim Houston, an athlete, businessman and philanthropist, sold for $6.495 million after it was restaged and relisted with a price reduction. The 11,080-square-foot residence, including eight bedrooms and 14 bathrooms, has been on and off the market since April 2015, once asking as much as $11 million, listing records show.”
The Wall Street Journal. “The Securities and Exchange Commission’s top official overseeing credit-rating firms said Monday the agency is rethinking its post-crisis effort to improve the quality of bond ratings, a tacit acknowledgment that the decade-old program has been a failure. Jessica Kane, who heads the agency’s Office of Credit Ratings, told a conference in Las Vegas that the SEC is now seeking input on ways to limit the pressure firms such as S&P Global Inc. and Moody’s Corp. face to boost bond ratings. Bond issuers, which benefit from higher ratings, pay the ratings firms to grade the bonds.”
“‘Are there other ways to address the issuer-pay conflict of interest?’ Ms. Kane asked a ballroom of attendees at the Structured Finance Association’s annual conference. Ms. Kane’s speech firmly puts credit ratings on Washington’s financial regulatory agenda. The issue has already received attention from lawmakers as well as investors concerned about security ratings. After the 2008 financial crisis, credit-rating firms were criticized for taking lucrative fees and giving high grades to risky securities that later caused big losses for investors.”
“After the financial crisis, the SEC didn’t end the practice of bond issuers hiring the firms that rate their offerings. Instead, the SEC decided to encourage ratings firms to publish unsolicited ratings on securities they weren’t hired to analyze. The agency crafted a rule to give them access to deal data to publish such ratings.”
“In October, The Wall Street Journal reported that the program had failed to promote the issuance of unsolicited grades from ratings firms, which concentrated on grading deals they are hired to handle. The article followed an investigation that found that inflated credit ratings were making a comeback in structured-finance markets. Ms. Kane said that ‘in light of comment received suggesting that the program is not achieving the commission’s goals, the commission directed staff to further evaluate the effectiveness of the program overall.’”
From DS News. “Experts predict that increases in foreclosure and REO inflow will come from government-insured loans, according to the Auction.com 2020 Default Servicing Industry Insights. The majority of servicers Auction.com surveyed expect foreclosure and REO inflow to increase in five of seven U.S. regions. According to the report, 89% said they expect government-insured foreclosure and REO inflow to increase in 2020, the highest among four product types provided as options in the survey.”
“The majority of survey respondents said they expect foreclosure and REO inflow to increase in 2020 in five of seven U.S. regions provided as options in the survey. ‘Most in the default servicing industry expect government-insured loans to be the primary source of increased foreclosure inflow in 2020, even in the absence of a widespread recession or housing downturn,’ said Jesse Roth, SVP of Strategic Partnerships and Business Development with Auction.com. ‘That’s a rational conclusion given the rising risk profile of FHA-backed loans originated in the last five years.’”