A report from the Wall Street Journal. “Anthony Holmes was part of the great Florida migration. In 2021, he moved from Virginia to a gated suburban community in Tampa. Now that he has had to leave, Holmes is another victim of a glutted housing market where buyers are increasingly hard to find. He paid $550,000 for his five-bedroom home and spent another $50,000 on solar panels and interior improvements. When he had to move back to Virginia for work, Holmes expected to sell his house quickly. But since listing it in February, he has had no luck. He dropped the price five times to $583,900 and would be happy simply to break even. ‘I can’t unload the thing,’ Holmes said. ‘In eight months, I’ve had zero offers. No one even showed up to the open houses. Nobody.’”
“In certain portions of Florida’s condo market, a correction is already here. rices are plummeting at many older buildings. While units built 10 years ago or less are selling for about 9% more today than they did last year, units 30 years or older are going for 19% less than they did last year, according to brokerage ISG World. At the Cricket Club condominium in North Miami, for example, two-bedroom units with water views that had been selling for $450,000 or more are now going for as little as $200,000 after residents were hit with a $134,000 assessment.”
“Another sign that the housing market is approaching an inflection point is that institutional investors—pinched by the same climbing insurance costs—are starting to sell. In Tampa, Orlando and Jacksonville, institutional portfolios of single-family homes account for nearly one in 20 listings over the past 60 days, according to an analysis by Parcl Labs. Those, such as Holmes, who have to sell properties are finding it tough and are tangling with rising insurance premiums. His insurance company dropped him a year ago after Hurricane Idalia scraped past, hitting just north of Tampa Bay. While the storm missed Tampa and his home was unaffected, he went from paying $1,700 a year to more than double that. ‘I have no doubt that a combination of high prices, high mortgage rates and high insurance has just totally collapsed the market,’ he said.”
Business Insider on Florida. “On September 27, the morning after Helene tore through the city of St. Petersburg, real-estate agent Katie Mallah received a call from a client with a recently-listed three-bedroom, two-bathroom home in the Shore Acres neighborhood, a collection of man-made islands. They asked Mallah to slash the asking price of their house, which had sustained nearly three feet of water damage. ‘They wanted to get out,’ Mallah told Business Insider. ‘They said, ‘We’ll demo everything, but we want to price it to just get out. So come up with that number.’ Mallah chopped the listing price by 40%, lowering it from $375,000 to $225,000. Within hours, she said, she was inundated with about 25 calls and 50 text messages from investors interested in tearing down the home and building a new one.”
“Palm Beach agent Holly Meyer Lucas said many homeowners who aren’t required to purchase flood insurance choose to go without it. ‘So many homeowners have dropped flood insurance or whittled their own insurance down to the absolute minimum,’ Meyer Lucas told Business Insider. If a homeowner lives outside traditional flood zones, they may forgo specific flood protection, but still pay for wind and homeowners insurance. But when they are hit with a historic storm surge like Helene, it becomes difficult to separate what was solely water damage. ‘It basically makes the home a total loss if they don’t have flood insurance,’ Meyer Lucas said. ‘We’re going to see a lot of people needing to sell their homes because they can’t afford the remediation,’ she said.”
My San Antonio in Texas. “According to housing data supplied by PR consulting firm HAVAS Formula, median sale prices, closed transactions and the close-to-list price ratio were all down both year over year and month over month in mid to late September. Plus, houses were sitting on the market for longer and housing market inventory in San Antonio continues to climb. ‘In our market, we have been seeing increased days on the market, and we have been seeing the average price drop in the greater San Antonio area, but there is still opportunity for the buyers who are actively looking,’ RE/MAX Broker Associate Sara Gerrish told MySA. ‘We are not seeing a lot of above list price offers, [so] now sellers are more likely to consider concessions to buyers.’”
“Gerrish says increased interest rates have helped cool down the market since the pandemic, when rates dropped significantly which sparked rapid interest in the housing trade. Further, she says the mass influx of Californians racking up the rates has died out some – a phenomenon noted by several potential buyers who said California transplants were entering a much more affordable housing market were able to outbid in Texas.”
Mansion Global on New York. “Manhattan’s luxury market continued its lackadaisical performance in the third quarter. The effect on pricing was fairly muted, with the median luxury price down 4% to $5.76 million since a year ago, in line with the broader market, where the median price dipped 3% to $1.12 million, Elliman’s data showed. This is the second consecutive quarter where luxury prices have slipped, according to Elliman. Two-thirds of new development units sold below the $3 million threshold, but the biggest discounts were recorded in the upper tiers of the market, according to Serhant. Units priced between $7 million and $10 million sold at a 9.6% discount on average, while sales for units above $10 million saw discounts of 5.8%, while loaded with 13.4 months of available supply.”
The Daily Mail. “Californians are sidestepping the state’s acute housing shortage and soaring property prices by building cute cottages in their backyards – but not everyone is happy about this new development. Some experts are warning that ADUs can drive down the price of single-family homes in neighborhoods because potential buyers may not want to live near the tenant of the backyard unit. Even though it’s become all the rage, a San Francisco real estate agent raised serious concerns about ADUs and their potential impact on the housing market.”
“Rohin Dhar said he sees plenty of single family home owners who build ADUs to rent it out for some extra income. The problem comes, he says, when they list their home, especially if there’s a tenant in the additional unit. ‘But when they go to sell the home, it sells for way less than if they had never built the ADU,’ he wrote in a post on X. ‘You’re basically selling a single family home with someone living in the in-law unit. That’s a hard sell!’”
Silicon Valley in California. “When Ashwin and Poonam Jain began searching for a larger home for themselves and two children in San Ramon earlier this summer, they quickly realized they were spending hours scrutinizing homes online, evaluating school districts and comparing sales prices of nearby listings. So why would they pay an agent tens of thousands of dollars to come in at the end and write up an offer? ‘As a buyer, we are doing all the work,’ Ashwin said. ‘Sometimes we struggled to see: Where is the value added from a broker?’”
“Now, buyers can’t count on sellers to pay their agents’ fees. Since the real estate group’s new rules debuted in August, buyers have had to sign agreements with their agents promising to pay a certain commission if the seller doesn’t offer one. Chris Robell, a retired tech executive, used ShopProp last year to both sell his home in Palo Alto for $2.56 million and buy a new one in Redwood City for around the same price, paying total fees of around $10,000. He estimates that he saved $120,000 in agent commissions. ‘It’s a high commission structure in the prevailing industry,’ Robell said. ‘It’s well worth it to pay something, but $100,000 for a home is ridiculous.’”
The Telegraph on Oregon. “I get off the bus at SW 6th Avenue, a handsome tree-lined street at the heart of downtown Portland. The site of the notorious former open-air fentanyl market outside an abandoned shopping mall, where until last year the strong and very cheap synthetic opioid was being freely traded, is now boarded up. The streets are quiet. It’s 18 months since I’ve set foot in downtown Portland. Like many residents and tourists, it’s been easier to simply avoid than risk the chaos of what many in the last few years have called an ‘open-air asylum experiment.’ This experiment has been encouraged by disastrously liberal policies including the defunding of the police, the decriminalisation of the possession of hard drugs for personal use, and the quashing of city codes preventing street camping (along with the actual handing out of tents by local government bodies and charities).”
“For anyone that has worked hard to avoid these outcomes in their own life, these sights were particularly triggering, and the chaos, exacerbated by Covid lockdowns, has already resulted in the fatal overdose of almost 1,000 people from fentanyl alone, mostly in the downtown area, the collapse of hundreds of businesses, and the desertion of the city by residents and retailers. But the city is finally on the mend. Although quiet, the main core of downtown Portland feels functional again. Anupama Rao, 32, from India, visited two years ago and again this summer. ‘Then, when I was driving in downtown Portland I saw a lot of homeless people and tents. One person was literally defecating on the side of the street and others were openly injecting drugs. It was disgusting. Now, it’s much cleaner, I don’t see any homeless activity and it feels safe. I now feel like coming downtown is worth it because I can actually hang out.’”
“Portland is a sprawling city, and it will be a long process to fix all of its 94 neighbourhoods. Most of Chinatown still feels unsafe, with large groups loitering around charity buildings, tents and junk-filled shopping carts. The approach to the otherwise magnificent Union Station is a terrible introduction to the city for anyone using Amtrak; I witnessed a fight and a staff member at a local hotel told me they had suffered vehicle damage and violent behaviour with little help from the authorities.”
Canadian Mortgage Trends. “Canada’s mortgage industry is responding to the federal government’s recent adjustments to mortgage rules, aimed at improving affordability for certain buyers. The new rules, which come into effect on December 15, will see the cap on insured mortgages raised from $1 million to $1.5 million, along with an expanded 30-year amortization option for first-time buyers and those purchasing new builds. ‘It is a band aid solution,’ asserted rate expert Ryan Sims in his weekly newsletter. ‘The problem remains that housing is too [expletive] expensive! Increasing the amortization does not lower the cost of housing. Extending the payments out longer does nothing to fix the root cause of the issue—it simply masks the symptoms.’”
CTV News in Canada. “Ottawa’s new mortgage rules set to take effect at the end of the year are drawing both praise, and caution in southern Ontario. Last month, the federal government announced it was making the ‘boldest mortgage reforms in a decade’ aimed squarely at young people trying to buy a home. ‘I would not want to be a first-time homebuyer at this moment in time,’ said Fred Godbolt, a financial advisor with GC Financial Solutions Group Inc. based in Exeter, Ont. ‘I don’t think this increases affordability for lots of people,’ said Godbolt. ‘I think the problem is carrying the $1.5 million of mortgage, not the fact that you can pay it over 30 years versus 25 years.’ The increased price cap is the first update since 2012 and Godbolt describes it as ‘keeping current’ with market trends. ‘There are markets where housing doesn’t exist sort of under a million dollars,’ said Godbolt.”
“Ottawa’s announced changes are receiving praise from the Windsor-Essex County Association of Realtors (WECAR) for its measures targeting first-time buyers struggling to secure a home. ‘We applaud these changes because, at this moment, this is the best I think the government can do,’ said Maggie Chen, the president of WECAR. ‘We cannot crash the market. Absolutely not.’”
From YLE News. “At the start of September, Finland had 5,000 unsold new-build apartments, according to the Ministry of Finance. Property investors’ lack of enthusiasm is especially evident in the capital region, where the number of unsold new apartments has risen sharply. A recent report from the Finance Ministry indicates that the number of unsold new flats is now unusually high, resulting in longer sales times for these properties. Finland’s largest housing developer, YIT, has a total of 1,212 unsold new apartments, with 867 located in Finland, according to the latest available data.”
“New apartments have typically been purchased by real estate investors, and when interest rates rose, investors stopped buying them. As a result, the drop in demand has been steeper for new apartments compared to older ones, Veera Holappa, a senior economist at Pellervo Economic Research (PTT), told Yle. Despite sitting on a record number of unsold flats, construction companies have so far been reluctant to lower their prices. ‘Construction companies hesitate to lower prices because it could impact their balance sheet values and access to new loans. They want to sell their existing inventory to be able to start new projects,’ Holappa explained.”
“Instead, construction companies have offered various perks, such as electric cars or free moving services, to draw buyers. These campaigns have, however, done little to boost sales. Lately, housing developers have also resorted to lowering prices. Pohjola Rakennus, for example, is offering a ten percent discount on the debt-free purchase price of certain new construction apartments, along with a year of maintenance fees included in the deal. ‘Right now it’s a buyer’s market for new construction, so customers should definitely be asking for price reductions,’ said Janne Paasimies, managing director of realtor Sp-Koti.”
ABC News in Australia. “Greg Manning spent last Wednesday hosing down embers that kept raining down onto his house from a nearby building fire. It was the third fire in two months in a cluster of derelict buildings at Woolloongabba, in Brisbane’s inner-east, which developers have left abandoned for years. The empty plots have become overgrown with weeds and the dilapidated buildings have attracted vandals, squatters, and copper thieves. Four houses near Mr Manning were bought by developers and left vacant, two of which have since burnt down. Mr Manning said the neighbourhood has never quite felt the same since the neighbours moved out. ‘What I’m feeling as time’s gone by, especially since 2013 when our neighbours were removed, is the safety of the neighbourhood has really been undermined,’ Mr Manning said. ‘In Woolloongabba, housing is increasingly being treated as a commodity, rather than a community.’”
“Griffith University urban and environmental planning researcher Natalie Osborne said abandoned buildings in Brisbane numbered in the tens of thousands. Dr Osborne said this was often due to ‘land banking,’ where developers buy land in the hopes it will go up in value or become ‘upzoned’ to allow taller buildings. She said developers were required to maintain safety standards for abandoned buildings, but the regulations were ‘toothless’ and rarely enforced.”