It’s Friday desk clearing time for this blogger. “A West Village townhouse that was once home to film star Will Smith is on the market for $12.5 million. That’s quite a hit, considering the buyer paid $13.82 million for the stately manse at 13 Leroy St. in 2008.”
“The nation’s largest homebuilders are buying up undeveloped land at a frantic pace. All those land purchases could create an economic pinch for homebuilders that overextended themselves. ‘The biggest concern I have is the land grab,’ Ivy Zelman, CEO of housing research firm Zelman & Associates. ‘The majority of these homebuilders are going out and buying land and underwriting today’s record-high absorption and price growth. Those numbers are not sustainable, but builders are buying land as if they are.’”
“Interest rates are rising quickly, and that has some worried about the effect that movement will have on the U.S. real-estate market. ‘The knee-jerk reaction from many market participants and the media is that any increase in mortgage rates spells doom for the housing market,’ said Jonathan Woloshin, real-estate and lodging analyst for the Americas at UBS Financial Services.”
“Despite their popularity, eviction moratoriums have mainly served to kick the can down the road where borrowers are concerned, argued Will Lamey, managing director of workouts at 1st Service Solutions. ‘(Residents) are suffering, hence the borrowers are suffering, hence the lenders are suffering,’ he said. Barring a government bailout, a key issue to be resolved will be which parties take the loss. ‘My guess is that it’s going to be a combination of borrowers and lenders and investors,’ Lamey said.”
“Liz Dunn owns six buildings in Seattle. Dunn’s properties are made up of more than 20 small businesses and nearly 30 apartments. ‘They’re all behind in one way or another,’ she said. Dunn credited her local banks for the ability to afford the financial help for her renters. ‘They’re affording me the same grace,’ she explained. ‘For example, I’m getting help with not having to pay the principal on the loan, just making the interest payments.’”
“Many mom-and-pop housing providers have had to hire staff and expensive lawyers just to keep up with the ever-changing government regulations. A new survey from the Santa Clara County Association of Realtors shows that nearly half are ready to sell and get out of the business altogether. The survey shows that 70% of the owners have mortgages, property taxes and other expenses that must be paid even if they are not receiving rent or aid. Owners like Carlos Padilla have worked hard to find resources for tenants who can’t pay their rent and to protect his lifetime investment.”
“When asked about his tenants who lost their jobs, Padilla said that ‘they have filled out numerous forms from nonprofits and other non-government organizations with no results and no feedback.’ Owners are now questioning how much longer they can hold on to their investments with all the new levels of bureaucracy and moratoriums.”
“Daniela Mello rents out six units across Ottawa to fund her retirement. Currently, half of them sit empty. ‘I never had vacancies before,’ Mello said. Before the pandemic, Mello said her units rarely sat empty between tenants. Now, it’s been months without a tenant. ‘I’ve had to pull money out of my savings to keep the properties going,’ Mello said.”
“As a result, some landlords have been forced to drop rent prices. ‘There’s certainly apartments to be rented for less money than they could be rented a year ago, especially in the downtown core,’ John Dickie, president of the Canadian Federation of Apartment Associations said. Mello says she can’t afford to follow their lead. ‘I’m not a big landlord with lots of properties, so if I reduce a lot, that will have lasting impacts for me for the years to come,’ she said.”
“According to the Real Estate Institute of Australia, rent prices declined 1.3 per cent for the year. Some investment property landlords are also being squeezed as tenants decide to move out to take advantage of cheaper properties. Landlord Mark adheres to a rule that it is better to lower rent than to let a tenant go. ‘It’s better to keep someone in a property now, rather than waiting months without rent and hoping to get someone in at a higher price,’ he said.”
“In September, he cut the rent on one of his investment properties to ensure he secured a good tenant. He’s now negotiating the price with the tenant of another property for a longer-term deal. ‘With this property, there are similar apartments in the building offering lower rent. I’m trying to find a price that encourages my tenant to stay rather than moving .A few stubborn landlords haven’t reduced rents and have had empty apartments for months. Some money is better than none,’ he said.”
“When experiencing difficulties making mortgage payments, landlords should always contact their lender; most still have assistance packages available. If you are forced to cut the rent, Jo Natoli, from the Rental Specialists says ‘it is better to have 100 per cent of something than 100 per cent of nothing.’”