A report from WFLA. “Florida homeowners are still getting hammered by rising insurance rates and some people are getting their policies dropped altogether. It’s a concern that has James Toth crunching numbers, especially after seeing a sharp 30% spike in his premium over the last two years. ‘We’ve had homeowners insurance for going on 57 years and have never filed a claim in 40 years,’ Toth said. ‘Our rates keep going up. We’re not going to be able to live here.’”
From WSVN. “South Florida condo residents, especially those in older buildings, are being hit with crushing special assessments. When they can’t pay, they face foreclosure. We met with six condo owners. But it could have been 600 or 6,000, all using the same words. Vicki LaRue: ‘They want a special assessment.’ The words now so common at so many condos like Tara West in Fort Lauderdale, where residents say the board first doubled the monthly maintenance fee. Vicki LaRue: ‘From $459 to $920.’ And then came the crushing special assessment. Vicki LaRue: ‘They want $8,158 from each unit.’ So many South Florida condo owners just cannot afford these large special assessments. Jeanette Delegram: ‘OK. I have Stage 4 cancer, and so, I’m back working again in order to pay all this. They don’t care.’”
“The deadline to pay the special assessment passed. We were told six of the 16 owners could not pay the $8,158 in a lump sum. Ginnis Arcos: ‘They put a lien on their apartment, and they’re basically thrown on the street.’”
From KARE TV. “Joan Hasper and Floyd Grabiel have each lived at the Windwood Condominium for a number of years. But this last year, their monthly homeowner’s association fees shot up. ‘The last year has been hell, to be honest with you,’ Hasper said. ‘Mine, when I moved in, was about $500-$600 a month. Now they’re over $1100. My assessment went up about 35%,’ Grabiel said. ‘Fortunately I’m able to pay it. Some of our longer-term residents might not be able to pay as easily as I have been.’ It’s happening to people all over Minnesota. And the reason, quite simply, is hail. The HOA board received just one company willing to cover them. ‘We were stuck,’ Grabiel said.”
From NBC Dallas. “If it feels like homeowners’ insurance premiums have gone through the roof, and in some cases look more like mortgage payments, it’s probably not your imagination. Destructive weather is part of living in North Texas. Melinda Clifton has seen hail damage her roof three times in two decades. After each storm, homeowners’ insurance paid her claims to replace it. But not long after her most recent claim, she received a bill that hit like a hurricane. Last year, Clifton said her annual homeowner’s policy cost $2,600. The following year, she said the cost more than tripled to $8,800. Clifton’s policy is paid through her home escrow account, meaning the monthly insurance payments are added to her mortgage payment. Clifton said her payments went up by hundreds of dollars per month, and she questioned whether she could afford to stay in her home. ‘I’ve thought, ‘Am I going to have to sell my home? The home I raised my children in,’ Clifton said.”
Texas Real Estate Business. “Newton’s second law of physics holds that what goes up must come down, but unlike objects in freefall, retractions in real estate cycles tend to unfold with varying degrees of pace and severity. In the case of multifamily investment sales in Texas, it’s been clear for some time that the market is in a much different place than it was in late 2021 and early 2022. ‘The deals that aren’t moving are those that are maybe 80 percent levered, in which the owner didn’t do capital expenditures and paid debt service instead of doing renovations with that money — those deals are now below their debt basis,’ explains Michael Becker, principal of Texas-based investment firm SPI Advisory.”
“‘Some buyers are taking on dumpster-fire deals and turning them around, but the juice may not be worth the squeeze in terms of how much they’re offering and how much time and effort it will take to turn some of these deals around,’ Becker continues. ‘Austin in particular is oversupplied, and you can acquire those assets well below replacement cost.’”
“With broader market uncertainty comes a reluctance to transact, which can be a contagious feeling. The alternative is for owners to accept that the days of obscenely cheap debt are over, recognize that market parameters have shifted and get back to business. Acknowledge that value destruction has occurred and that some deals are dead where they stand. Resign to the reality that some return thresholds are not going to be met, and that some sales may result in losses. Embrace the downturn, rip off the Band-Aid and begin looking to the future rather than the past. This is much easier said than done, of course, especially when it’s not your money at stake. But it’s an approach that some brokers can endorse.”
Capital & Main on California. “The first complaint about illegal vacation rentals at 1940 Carmen Ave., a rent-controlled apartment building just blocks from Hollywood Boulevard, arrived at the Los Angeles Housing Department nearly a decade ago. ‘This place is crazy,’ a tenant reported in 2015, according to an inspector’s note, ‘luggage up and down, different people always in and out. Not safe.’ Inspectors cited the owner for changing the building’s use without a permit. They warned him again the next year. But after that, housing inspectors appeared to drop the matter, even as they ordered the owner to correct other building code violations. A few years later, in 2020, a tenant complained that 14 of the 21 units were listed on Airbnb.”
“Yet the city has failed to enforce the law. Booking.com recently listed one-bedroom units in the building for about $160 a night. Asked about short-term rentals, 1940 Carmen owner Alexander Stein said, ‘I would rather not discuss it. Thank you for calling, though,’ before hanging up.”
“What happened at 1940 Carmen has played out in dozens of other buildings across Los Angeles. Landlords are using rent-controlled apartments as vacation rentals in apparent violation of the law, an investigation by Capital & Main and ProPublica has found. In some cases, entire apartment buildings with more than 30 units are listed as boutique hotels on sites like Hotels.com and Booking.com. At a housing and homelessness committee hearing last fall, city planner Lance Sierra told the group that once a citation has been issued, it ‘takes between two to three years to complete.’ The chairperson, City Councilmember Nithya Raman, was incredulous. ‘Two to three years …?’ she asked. The City Council is expected to vote on recommendations to tighten the home-sharing ordinance later this year. ‘I think you have to make it so that if you violate the law, you are very likely to get a penalty,’ Raman said. ‘Unless we do that, we are going to see continued flouting of the laws — because flouting of the laws is very, very lucrative.’”
From CTV News. “Three months into B.C.’s new Airbnb rules, the NDP government says nearly half of properties listed in communities that keep the data still aren’t licensed. In Victoria alone, the city says it’s investigating more than 560 properties actively advertised that don’t have a licence. Those who bought units as retirement nest eggs and can no longer can rent them out short term cry foul. ‘I’m just really shocked that in Canada, in British Columbia, you can make an investment in your community and in your future for your family and it can be ripped away like this,’ said 62-year-old Suzanne Little, who says she has had to delay her retirement plans indefinitely as the income from her property is suddenly no longer available.”
Cottage Life in Canada. “The post-pandemic market saw a leveling-out of cottage inventory in many of the major Ontario cottage areas, including Muskoka, Parry Sound, and Kawartha Lakes. ‘There’s a gap between what sellers want and what buyers are willing to pay,” says David Donais, owner of Kawartha Waterfront Realty in Kawartha Lakes, Ont. But it’s the width of the divide that is unusual, according to Donais. ‘Sellers have the memory of what prices were like two years ago,’ he says, which is leading to more overpriced listings that sit on the market for months.”
“So, what is driving cottage sales right now? The simple answer is a well-priced listing. ‘If you’re priced higher than the market, it’s going to sit there. On the other hand, if you price competitively, it sells,’ says Donais. In Kawartha Lakes, cottages priced at the lower end of the spectrum—around $800,000 or less—are selling much more ‘robustly’ than listings at $1.5 million and above, he adds. ‘All it takes is one or two sellers to accept a fairly low price for a property, then that becomes the new benchmark,’ he says. ‘That’s the comparable and that’s what buyers will zero in on.’”
“These high listing prices follow trends outlined in RE/MAX’s cottage real estate update from April. The report predicted Ontario cottage prices would increase in 72 per cent of recreational markets, a number that, anecdotally, appears to be accurate. That said, ‘Buyers have the power right now and they know it.’”
From The Local. “An analysis from DNB Eiendom has found that around 10,000 newly built homes or homes planned to be built have not yet sold, business and financial site Dagens Næringsliv reports. This is despite the need for more new homes in Norway to combat a tight market and rising prices. ‘We have taken measures to reduce the number (of unsold homes),’ the CEO of property developer and housing association OBOS, Daniel Kjørberg Siraj, told DN. The company had around 540 unsold homes in Norway and Sweden, an increase of 140 compared to the previous year. Siraj said that if OBOS had not implemented measures, such as more favourable buying terms and offers, the number of unsold new builds in its portfolio would have been between 800 and 1,000. According to Siraj, the developer was still struggling to sell larger properties. ‘There are particularly larger apartments (going unsold). We manage to sell most small apartments,’ he said.”
Warsaw Business Journal. “The housing market in Poland has shown signs of cooling, with the first decrease in square meter prices recorded in over a year, according to 300Gospodarka. After a period of intense growth and escalating prices, the recent data suggests a stabilization. Analysts attribute this decline to a combination of increased supply, higher interest rates, and economic uncertainties impacting buyer demand. ‘While the market remains robust, we are seeing a natural correction as prices adjust,’ a real estate expert said.”
ABC News in Australia. “Construction work is continuing on a luxury home belonging to the wife of the managing director of an embattled Perth builder deregistered by authorities, while more than 230 unfinished customer homes remain unfinished. Premier Roger Cook said while he did not know the details of the homes being built for company directors and their families, he could ‘understand that adds insult to injury’ for others trying to get their homes completed. Jennifer Lee, who has been waiting more than four years for her Nicheliving house in Tapping in Perth’s north to be built, said it’s ‘not fair’ the managing directors will be able to access the indemnity insurance.”
“When the ABC visited the site yesterday, several wooden door panels of Ms Lee’s house were rotten, the flooring inside the house had turned green in colour and rubbish was scattered throughout. ‘I truly hope that they feel the pain that we have been feeling now that they’re not allowed to build anymore and that they can see what we have been going through not having our houses completed,’ she said. Ms Lee said she plans to sell her home when it’s finally completed or is even considering ‘knocking it down and starting over again.’ ‘I actually stopped driving past because it was just so depressing, so depressing,’ she said. ‘When you’ve got something with all of your life savings and nothing going forward, you’re losing out daily.’”
Business Insider. “Hong Kong once held the record for the priciest home sold in all of Asia. But some owners of the island’s most luxurious houses have been selling them at a loss this year. Some high-end properties sold in the first half of the year for up to 50% off 2018’s peak prices, said Jack Tong, the Hong Kong director of research at real estate services company Savills. ‘The lack of ultra-high-net-worth mainland tycoons due to slower China economic growth and stricter capital outflow restrictions meant no more record-breaking prices registered for the sake of trophy assets as in the pre-COVID period,’ Tong said. In the first half of the year, around 75% of properties valued over $10 million involved cash-strapped sellers, according to data from CBRE Group.”