A report from the Gilbert Sun News in Arizona. “Overall, Phoenix Realtors board President Sheryl Bowden was upbeat about the June housing market results for the Valley in general, though she admitted, ‘It’s still a challenging marketplace. With the over 6,100 new listings in June, we have a strong 3.6-month inventory of more than 16,400 homes right now.’ Looking at the Valley’s 17 submarkets, the Cromford report said a number of cities is moving ‘substantially in favor of buyers.’ That list includes Tempe, Gilbert, Fountain Hills, Paradise Valley, Goodyear, Cave Creek, Glendale and Chandler. ‘None of the conditions necessary for significant price falls are in place. Mortgage delinquency is low, sellers are motivated but not desperate and supply is not running far ahead of demand, as it did in 2006. The increasing flexibility from sellers that a balanced market brings will cause list prices to fall, but is not likely to have much effect on final closing prices.’”
The Ocala Gazette. “Brad O’Connor, senior economist for the Florida Realtors, a statewide agents’ reporting and professional trade association, said that, generally, ‘Florida’s housing market in June and second quarter (2Q) 2024 showed rising inventory levels, more new listings and moderating median sales prices compared to a year ago.’ Locally, the market area of Ocala/Marion County townhouses and condos median sales prices came in at $188,500, a decrease of 9.1% from June 2023. Statewide, townhouses and condos active inventory is 62,011, a 91.9% increase from June 2023. Overall, the market is moving toward more activity. Existing townhome and condo properties statewide were at a 7.4-months’ supply, a large increase of 105.6% over June of 2023.”
Mansion Global on New York. “A Tribeca penthouse asking $8.65 million is headed to auction in August after spending more than a year on the market, and shedding 30% of its initial asking price. The triplex apartment on Vestry Street is headed to auction via Concierge Auctions in conjunction with Douglas Elliman’s Jonathan Stein and Gavin Shiminski. Bidding is expected to start between $3 million and $5.5 million, according to the auction house. The Tribeca condo first hit the market in April 2023 asking $12.2 million, before a series of price cuts brought it down to its current price. Luxury listings have been piling up in Manhattan, increasing by 22.4% in the second quarter compared with the same period last year, while the median sale price dropped 10.2%, according to a second-quarter report from Douglas Elliman, which defines luxury as the top 10% of sales.”
Market Place. “LaTisha Grant is the executive managing broker at TAS Realty Group in Houston, Texas. She joined Marketplace’s Amy Scott to talk about a potentially cooling housing market in Texas. Scott: Are you seeing any loosening up in Houston? Grant: We are. You know, Amy, the last time we spoke, I was saying that I was hopeful that things will change some for our poor buyers. And they have. In our office, I have not seen us write more than two offers before getting an acceptance. Whereas before it was writing offer after offer after offer before you were going to get your offer accepted. So it has definitely loosened up for the buyers.”
“Scott: So sales have slowed down a little bit, meaning that sellers may be more willing to take an offer from one of your clients? Grant: Absolutely. A more reasonable offer now. So, gone are the days that buyers are waiving inspections, gone are the days that buyers are saying, ‘Oh, well, we’ll just take what you give us.’ So the good part for many of our buyers is that they are now able to make a reasonable offer on a property —market value, not above market value — and even asked for some closing costs.”
From CBS Dallas. “Singing the Bollywood melodies had made Sidhartha ‘Sammy’ Mukherjee a local celebrity in North Texas. However, behind the scenes, Mukherjee is accused of using his fame and charm to defraud people out of millions of dollars. More than a dozen people have told the CBS News Texas I-Team that they gave Mukherjee money for what they thought were real estate investments. They claim, in both interviews with the I-Team and in court records, that Mukherjee’s pitches turned out to be fabricated. Many accuse the Plano singer of going as far as forging contracts, emails and documents to convince them the real estate projects were real.”
“Terry Parvaga, who claims he lost all $400,000 from his 401K account to Mukherjee, said, ‘They will make you believe that they are very successful businesspeople, but they will take every single penny you have.’ In 2023, Mukherjee filed for bankruptcy, and the case is still pending. According to court records, Mukherjee owes more than $2.7 million – more than half of that debt comes from creditors who claim in court records that they were defrauded.”
The Modesto Bee in California. “Construction has begun on a 527-home project in east Modesto, the city’s largest by far in the past decade-plus. The developer had estimated prices starting ‘in the high $400,000 range’ when the Modesto City Council approved the plans Jan. 30. That figure and the upper limit are still being refined, the company, D. R. Horton Inc., said in an email. The project, called the Crossings, is on 84 acres just west of the Amtrak station. Most of the site had mature almond trees, which were toppled and chipped earlier this month. The homes could be too pricey for most Modesto residents, but supporters said they would ease the housing shortage indirectly. Many will be purchased by people now living in apartments, which will free up rentals for others. A 9-foot-tall sound wall will run along the tracks, which also carry freight trains.”
The Globe and Mail in Canada. “In Toronto, we elder millennials are a subgeneration divided when it comes to real estate. We either got in early, or we balked and missed the boat. I was one of the latter – until last year, when I became financially able to buy a condo, and decided to try. In August, 2023, the landlord of my condo rental put my one bedroom plus den unit up for sale. He priced it averagely for the current market. The unit received very few showings. My landlord would intermittently lower the price but to no avail. Fall became winter, spring became summer. The unit remains for sale, an entire year later.”
“My offer was fractionally under his asking price. He didn’t budge. It began to hit me. Why would I buy a condo that, clearly, cannot sell at current market prices? Further, why would I look elsewhere, and buy a comparable unit that probably also cannot sell at current prices? My landlord had understandably bought a new condo back when rates were low, and value was appreciating. I couldn’t blame him for keeping the selling price in the mid to high 500s – he was already taking a major hit, lowering it to much less than he paid for. Like so many other investors in the current Toronto market, it would be difficult to mentally reconcile this kind of loss.”
“Clearly, both my landlord and I have been slow to settle into this very new reality. But this isn’t just my condo – it’s the Toronto condo market in 2024. ‘In a year, everything has turned on its head,’ says Pino Di Mascio, a Toronto urban planner and Partner at SVN Architects + Planners. ‘Typically in Toronto, people rent in their 20s and 30s. Then they look to buy, on the understanding that their home will appreciate – because for over 25 years, they did. We’ve never seen a situation like this,’ Mr. Di Mascio said. ‘But as people begin to realize that home values don’t always appreciate, they could make the conclusion that they are better off renting.’”
CBC News in Canada. “A now-suspended and retired Toronto lawyer hasn’t paid two sets of clients more than $1 million the courts have ordered he pay after they sued him for keeping the proceeds from the sales of their home and business. Xiaolong Zhang and his wife sold their auto parts distribution business in Vaughan, Ont., at the end of last year to fund their retirement. They said they hired Ping-Teng Tan to handle the sale because they trusted him after using him for previous legal work. The business sold for more than $520,000 and the money was transferred to a trust account set up by Tan’s law firm, Tan & Associates.”
“But, despite calls, texts, an in-person visit and a legal demand, Tan hasn’t transferred the money to Zhang and his wife. ‘Instead of peaceful days and financial security, we are living a nightmare,’ Zhang said. ‘We felt deep anguish and betrayal as someone we trusted with our future had deceived us.’ Tan did not respond to CBC Toronto’s requests for comment for this story on his personal email and cellphone. His law firm email has been shut down and the phone number is not in service.”
From News.com.au. “Interest rate rises have been a point of stress for many Australians, with one young couple revealing the mortgage hell they will they will find themselves in within a few months. In January, Danielle and Blake Russell will come off their fixed home loan rate, and they are dreading it. They are currently paying around $500 a week, which is set to double to over $1000 at the start of next year. Ms Russell is worried about falling off the mortgage cliff. The couple lives in Western Sydney. The couple bought their home in January 2021. Ms Russell said she was relieved they did because they couldn’t afford to enter the current market. ‘We own and we were lucky enough to get into the market when we did and smart enough to fix our loan,’ she said.”
“Ms Russell isn’t alone in facing down mortgage stress. Financial comparison website Finder said borrowers who took out a two-year fixed-rate loan in 2021 at a near rock-bottom 2.21 per cent rate could see their repayments on an average home loan of $580,247 skyrocket by $1776. ‘We are like ‘oh my god! What are we going to do?’ Ms Russell said. If the rates stay the same — and there are fears they could increase even further — their mortgage will double overnight in January, which is less than six months away. The couple has two young children to support. ‘We’ve always felt so lucky not to have to pay more, but coming up in January, yeah, we are just hoping interest rates go down,’ she admitted.”
Radio New Zealand. “Two men who spent years locked in court battles with the same landowner over leasehold homes they purchased in Auckland are warning others of the risks of the leasehold model. When John* found he and his best mate could buy a three-bedroom home in Auckland for $100,000 – well below the national average for 2013 of $466,000 – it seemed like a perfect way to get onto the property ladder. He knew the property on Canberra Avenue was a leasehold, but with rent of $250 per month and an option to buy as a freehold in two years, it seemed like too good a deal to pass up. ‘I showed it to my lawyer and they said it was a great deal and I should go for it.’”
“Two years went by, and John said he gave the house a complete renovation, he approached Trust Management, a property investment company that landowner Neil Christian was using, asking if he could buy the land. ‘At first things seemed positive, but they kept trying to talk to me about renewing the lease agreement which wasn’t what I wanted. I looked at valuations and saw the land was worth between $300,000 to $350,000. But when I told them about these prices I was told it was worth $1 million and as land prices went ballistic my ground rent would increase to $1000 per week.’”
“John said he tried to fight the rent increase and hired a new lawyer, but in the end he had a discussion with Trust Management and was told if he walked away now he wouldn’t be pursued for rent arrears. ‘I took it,’ John said. ‘I still had the mortgage to pay off and was left massively out of pocket due to the money I’d spent renovating that house and I’d used my KiwiSaver buying it. During that time I was working seven days a week just to keep up. I had to just walk away for my own sanity.’”
“John said he’d driven past the house since leaving but tried to avoid it as he found it too upsetting. ‘I put a lot of blood, sweat and tears into it – I can’t buy another house because I used my KiwiSaver, it ruined my friendship with my best mate, I don’t know how I got through it actually.’”
Asian Banking and Finance. “China is in the process of cleaning up its embattled rural financial institutions — a move that will not just lead to the mergers and closures of its 3,800 rural financial institutions, but also see the number of major banks shrink. In just one week in July, 40 banks disappeared in China. These disappearances were inevitable. In fact, China was behind the scheme, having already spearheaded the merger of 70 rural banks since 2023.”
“‘There is an oversupply of rural financial institutions, leading to operational disorder and increased risks,’ Betty Huang, economist at BBVA Research, told Asian Banking and Finance. ‘China’s small, rural banks are confronted with deep-seated issues such as aggressive lending practices, inadequate risk management, and exposure to a downturn in the property market.’ These banks have also heavily lent to developers and local governments, leaving them vulnerable to fluctuations in the real estate sector and China’s slowing economic growth, Huang said.”
“‘Notably, some institutions have reported non-performing loan ratios as high as 40%, significantly above the industry average of 1.6% as of the first quarter of 2024,’ she said, adding that their provision coverage ratios also fall below the supervisory requirement of 150%. The risk and probability of failures remain likely, however. ‘Excessive economic reliance on real estate attracts substantial capital inflows, driving asset prices to unsustainable levels, fostering economic illusions that eventually collapse,’ Huang said.”