It’s Friday desk clearing time for this blogger. “Ceruzzi Properties snagged a $350 million condo inventory loan for its luxury condominium tower in Midtown East. The tower is more than 800 feet tall and has 124 condo units. Ceruzzi launched sales in the building in April 2019. New York’s luxury condo market is contending with an inventory overload. There is $5.7 billion in existing inventory on the market and $33 billion in shadow inventory, according to a 2019 report from Halstead Development Marketing.”
“New York’s shuttered Waldorf Astoria hotel will re-emerge this week as a condominium, testing whether nostalgia for a cherished landmark can spark high-dollar deals in a market glutted with luxury homes. The Park Avenue property has been getting primed for this moment since 2015. That is when China’s Anbang Insurance Group bought it for a record US$1.95 billion. Five years later, the Waldorf is still a construction zone, Manhattan is awash in ultra-luxury condos and the property’s once high-flying owner has had its wings clipped.”
“‘The data will tell you that this is not the time for another Midtown luxury condo,’ said Donna Olshan, president of Olshan Realty. The area ‘is saturated with inventory that could take a decade to sell.’”
“A zoning change that could allow 100 age-restricted apartments for seniors in a single-family neighborhood was submitted for approval this week by a prominent Danbury developer. Danbury doesn’t have much choice, with the glut of single-family homes driving prices down and a need for affordable senior housing that doesn’t add students to the city’s swelling school system, developer Dan Bertram says.”
“For the past couple years, the luster seemed to have faded on Georgetown’s luxury housing market. Jamie Peva of Washington Fine Properties says the reason the two houses he listed sold quickly was because they were priced correctly. The sellers didn’t challenge the market by setting an aspirational list price. ‘There have been a lot of houses on the market at some very big prices,’ he said. ‘Purchasers haven’t seemed to be willing to pay them.’”
“Rachel Hunter has sold her home in Hollywood Hills West for $3.45 million — about $1.5 million less than the supermodel-actress was asking when she first listed it in 2016.”
“As Greene loses population, the people who remain are forced to deal with the properties left behind. More than 42 percent of all housing units in Greene County were vacant in 2018, according to the Census. That’s the highest rate in Alabama, a state that itself is near the top of the country in terms of vacancy rate. Alabama is fourth in the country for raw vacancy rate. More than 18 percent of all housing units in the state are empty.”
“Many areas of the country, included certain parts of Alabama, see their vacancy rates climb because they have lots of seasonal housing. Think of Alabama beaches in Baldwin County. There are lots of beach houses and condos that sit empty for most of the year, but are used throughout the summer. As a result, Baldwin’s raw vacancy rate is high – nearly 30 percent. And Baldwin is the fastest growing county in Alabama.”
“Two fires in vacant homes within 48 hours of each other last week has residents concerned. There are roughly 34,000 vacant homes in Honolulu, a vacancy rate of more than 10 percent according to the U.S. Census Bureau. All those vacant houses are not only an eye sore to those who live near them, they pose health hazards and also invite the wrong element into neighborhoods.”
“While some have no doubt made money by condo investing (i.e., not purchasing a condo unit to live in themselves but to either rent it out or sell it in order to benefit from the condo’s price appreciation), I’m seeing too many people assume that this will always be the case – even though the data suggests that we need to be very cautious about the pre-con market in the Toronto area right now. But if you buy a pre-con condo and prices fall 20%, unless you have a lot of money saved up, you’ll be unable to even take possession of that unit to live in it or rent it out because banks only finance what the property is worth, not what you paid for it.”
“We saw this exact scenario unfold with pre-con detached homes in Oakville in Halton Region and in Durham Region in the Greater Toronto Area when buyers paid peak prices in 2017 only to find that when their house was completed, it was worth significantly less than what they paid for it. Many lost their life savings because they did not manage that downside risk.”
“Areas earmarked for the most development over the next five years include Blacktown (18,700 new dwellings), Parramatta (17,800), City of Sydney (13,650), Cumberland (12,650), Liverpool (12,750), the Hills (12,700), Camden (10,900) and Bayside (10,000). Liberal Minister Victor Dominello said he was pleased about the reduction in targets for his local area ‘given the explosive growth that we have had up until this point.’ ‘I’m not against development – I’m against over development,’ he said.”
“Help to Buy has faced criticism since its inception for hiking house prices and delivering pure profit to housebuilders. But back then, few worried about the structure of the deals themselves – and what problems may lie ahead. This was partly due to the fact that it was designed to help developers start building again in the doldrums after the financial crisis, but also buyers themselves did not ask what the catch was for all this apparently ‘free money’.”
“It’s now more than five years on, and the first people who took out Help to Buy equity loans are having to pay interest on what the government lent them. Now, new figures show that more than one in 20 recipients of Help to Buy loans had fallen into arrears at the end of November as their interest bills mounted.”
“It is well known that real estate is dead in the commercial capital of India. Builders priced their products at levels of a Mercedes but built a supply of the scale of Tata Motors. For projects like Oberoi Three Sixty West, the pool is smaller given their price point for their 256 flats. The challenge is: There are only 797 people in Mumbai boasting a wealth of more than $30 million/Rs 200 crore. Two, it may still have worked to a small extent if the city only had held up. But the absolute decay and collapse of Mumbai to such levels has ensured that the bright and rich find it neither a place to invest nor live in.”
“Chinese officials in Wuhan and other cities within Hubei Province, where the novel coronavirus outbreak is most severe, reported to their higher-ups in the provincial government that people are not able to secure treatment, running out of supplies amid restrictive lockdown measures, and feeling fearful and anxious about the spreading disease. Despite such observations, authorities prioritized how to ‘control the society’ and ‘manipulate public opinion’ to view China’s efforts to contain the virus positively, according to internal government reports that The Epoch Times obtained.”
“‘After the city was locked down, the majority of residents lost their income,’ the Shiyan PLAC said. ‘Overall, people have strong negative emotions, such as grief, panic, anxiety, and suspicion. The feeling of anger among society has increased.’”
“Such documents reflect Chinese bureaucrats’ mentality, ‘which has existed since the Party controlled China in 1949,’ said Tang Jingyuan, U.S.-based China affairs commentator in a Feb. 27 interview with The Epoch Times. ‘Officials from different levels want to keep their positions. In order to do so, Party members try their best to maintain social stability, which is treated as an achievement,’ Tang added. ‘As for people’s lives, that is not important in the officials’ eyes.’”
“The lack of space at Chinese ports is causing significant issues for New Zealand’s forestry industry. The Forest Owners Association president Peter Weir said in a statement that precautions in China against coronavirus had resulted in almost no off-loading of logs in China for processing. ‘In regions where there is no domestic sawmilling, many harvest contracting crews are being put on reduced hours or, worst case, stood down,’ Weir said. ‘Regrettably many of our contractors have little alternative but to lay-off skilled workers.’”
“Red Stag Timber chief executive Marty Verry said there were few short-term solutions available to the forestry industry. ‘This is bringing our third biggest export industry to a grinding halt,’ he said. China takes about 60 per cent of New Zealand’s logs, Verry said. ‘This really goes to show why we have to stop relying so much on China as a domestic market for our logs,’ he said.”