A report from Deseret News. “According to Realtor.com’s monthly housing market trends report, the number of homes actively for sale grew in May for the seventh month in a row, growing by 35.2% since this time last year. The metro areas that had the most inventory growth over the past year were Tampa, Florida, with an 87.4% increase; Phoenix, Arizona, 80.3%; and Orlando, Florida, 78.0%. This trend in inventory growth can be seen in Utah’s housing market as well. In April, the number of homes for sale in the state was up 12.4% year-over-year, according to Redfin data. Condo/co-ops saw the biggest year-over-year average increase in availability in Utah with a 32.5% jump since April of last year. In April of this year, there were 1,504 condo/co-ops for sale in Utah.”
KOAA in Colorado. “After two years of dwindling single-family housing permit numbers, home construction is on the rise again in the Pikes Peak Region. The number of single-family home permits pulled from Jan. to May this year (1,463 permits) is 32% higher than the same time last year. ‘That means a lot more homes are going to be coming available probably later on this year, if not early next year,’ said Greg Dingrando, a spokesperson for PPRBD.”
From Fox 13. “The Seattle real estate market is experiencing a seasonal surge, with significant increases in home sales and median prices, according to the Northwest Multiple Listing Service (NWMLS). Twelve counties experienced an uptick in the number of homes sold, while 13 saw a decrease, and Cowlitz County’s sales remained stable. This increased activity is partly attributed to the dramatic 41% year-over-year rise in for-sale inventory across the region. Condominium sales in May also reflected positive trends, with a 70% increase in the number of units for sale compared to May 2023. ‘With the 30-year fixed mortgage rate currently at 7.03% as of late May 2024, the purchasing power of prospective buyers remains constrained relative to a few years ago,’ said Steven Bourassa, director for Washington Center for Real Estate Research. ‘Year-over-year inventory levels have improved dramatically relative to May 2023, increasing by 41%.’”
The Key Biscayne Independent. “South Florida’s housing market bucked the national trend in April, new data reveals – but in Key Biscayne, condos appear to be cooling off just a bit. ‘I think that the takeaway from this is that condos probably do need to be careful because we’re building a lot of condos. Like the total sales of condos on the Key were down 21%,’ said real estate expert Ron Shuffield, president and CEO of Berkshire Hathaway HomeServices EWM Realty. He added that, ‘Condos, especially, we’re starting to see things cooling off is… It’s certainly not crashing.’”
“Condo owners in parts of California are slashing asking prices by as much as 40 percent for their properties listed for sale on Zillow. As of Wednesday morning, there were a total of 8,476 condos listed for sale on Zillow across all of California. Of these, 1,973 have had their initial asking price reduced by sellers. A majority of these price reductions on condos were focused around San Francisco, San Jose and Los Angeles. Vacation rental investor Rohin Dhar routinely posts on social media about the most dramatic price drops in the market. A listing shared by Dhar on X shows a condo for sale in San Francisco’s Russian Hill neighborhood which was originally purchased for $3.2 million in 2016 and sold again on June 3 for $2.25 million—$950,000 less—at least a 29 percent drop from what it fetched eight years ago.”
Willamette Week in Oregon. “You may not believe it when you look at your rent bill, but the Portland apartment market is in the dumps, at least for developers. Lots of new buildings went up just as migration to Stumptown went down. Total occupancy in Portland-area multifamily buildings fell for a seventh consecutive quarter in the first three months of this year, as new supply outstripped demand, according to Colliers. The slump appears to have come at a bad time for VWR Development, the company that controls this week’s vacant property in Sellwood through a limited liability company. VWR also developed Sandy 51, a 91-unit apartment building on Northeast Sandy Boulevard at 51st Avenue (hence the name).”
“City records show that Sandy 51 sold last month for $14.4 million to an entity called StandishII House LLC, which, in turn, is controlled by Thuja Apartments LLC in Seattle. Thuja appears to have gotten a deal. Dividing the price by the number of units shows that Thuja paid just under $160,000 per unit. By comparison, the Beverly, an apartment building just down Sandy, sold earlier this year for $300,000 per unit, according to Colliers. And erecting the building today would cost about $350,000 per unit, according to Colliers analyst Jamison Shields, or around $32 million. Adam Smith, senior broker at HFO, says he knows of half a dozen apartment buildings that are on the market and could be purchased at around $125,000 per unit. ‘I can show you how to house 1,000 people very quickly,’ Smith says.”
Bisnow New York. “LuxUrban Hotels is in hot water again as New York City hotel landlords chase it down for millions of dollars in unpaid rent and try to kick the publicly traded hotel operator out of their properties. The Miami-based firm operates budget hotels via master leases with landlords — a model that has been compared to WeWork — and has recently seen its share price nose-dive into penny stock territory in the wake of a short seller report, self-inflicted wounds and leadership shake-ups. In the last three months, three property owners who lease their buildings to LuxUrban have filed suit, claiming the company has failed to pay rent and should be evicted from the hotels. A fourth landlord is facing foreclosure at a Midtown LuxUrban property after missing debt payments.”
“Now, the hotel company could look to sell or liquidate following the creation of a special committee of its board tasked with exploring strategic financing initiatives, it announced Monday. Richard Born’s BD Hotels, which leases the 117-room The Blakely hotel at 136 W. 55th St., sued LuxUrban May 10 in New York Supreme Court, claiming it has failed to pay more than $550K in rent and fees and ignored a notice that its lease had been terminated. ‘In two words- THEY SUCK,’ Born told Bisnow in a text message Wednesday, declining to comment further.”
From Bloomberg. “The private equity industry must face up to the reality of lower valuations, according to Apollo Global Management Inc.’s Scott Kleinman. ‘I’m here to tell you everything is not going to be ok,’ the Apollo co-president said in a session at conference in Berlin on Wednesday. ‘The types of PE returns it enjoyed for many years, you know, up to 2022, you’re not going to see that until the pig moves through the python. And that is just the reality of where we are.’ Private equity firms didn’t take significant markdowns during the recent period of rapid rate hikes which means that ‘investors of all sorts are going to have swallow the lump moving through the system,’ he said, referring to assets that private equity firms bought up until 2022. Funds are now holding on to these companies and will eventually have to refinance at higher rates. That means ‘fewer realizations and lower returns’ are on the horizon for much of the industry, said Kleinman, whose firm is known for its value-orientated strategy.”
CTV News in Canada. “Jamie Goren expects when he renews his mortgage in November he might be paying more than ever before. He moved into his Dollard-des-Ormeaux home in 2002 with a rate of 4.35 per cent. For the last four years, it’s been 1.69 per cent. ‘I would give my left arm to get 1.69 per cent again,’ he said in an interview with CTV News. ‘I’d even be thrilled to get double 1.69 per cent, but I don’t even see that happening.’ He recently received a letter from Scotiabank saying it is offering 5.09 per cent. Goren expects that could cost his thousands more every year.”
“Monthly mortgage payments in Montreal are now more than $1,500. Broker Brad Weigensberg says he’s seeing more cases of people struggling to keep up with payments. ‘A lot of what we’re seeing now is people that are trying to buy homes, especially young people, working two or three jobs,’ he said. ‘Homes here in Quebec under $450,000 are still going to increase because the demand is there. We’re having a lot of immigration come in and people need homes. The upper echelon homes have stalled, the values have stalled,’ he said.”
Global News in Canada. “Local Realtors blame slow condo sales for a sluggish month of real estate sales in Waterloo Region in May. A total of 742 homes changed hands last month, which is 8.2 per cent below what was a slow May in 2023, according to the Waterloo Region Association of Realtors. The number of sales in May 2024 represents a 20 per cent dip over the previous 10 Mays. ‘May saw a dip in the number of sales across all categories, with condo apartments experiencing the largest drop,’ WRAR president Christal Moura stated. ‘The Condo market also had the greatest supply level, posing a challenge for sellers, especially for units with one or fewer bedrooms, where the current inventory level exceeds buyer demand.’”
“‘This spring, we are witnessing a significant increase in the availability of apartment-style condos, with a record high number of units on the market,’ Moura said. ‘At the same time, we are observing a shift in demand away from smaller-sized condo units, potentially influenced by the higher interest rates impacting investor market activity for this property type.’”
Go Banking Rates. “Global housing prices are finally dropping. According to the Bank for International Settlements (BIS), ‘In the fourth quarter of 2023, global house prices deflated by consumer prices declined by 1.2% year-over-year, compared with 2.0% in the third quarter.’ The German real estate market has experienced a recent record drop (the most significant drop in 60 years) due to high financing costs — and waning political support — that’s deterred homebuyers, according to Bloomberg. The outlet reported, ‘Multi-family buildings led the downturn with a 20% drop, while apartments fell 9% and single-family homes declined 11%.’”
“Hong Kong was one of the most expensive places in the world to own a home, but the wild days of its housing market might be over. Prices have decreased 10%, per BIS. ‘Various environmental factors, such as the 2019 protests against the National Security Law and the aftermath of the COVID-19 pandemic, have contributed to this shift,’ according to Global Research and Consulting Group Insights. Located in northwestern Europe, Luxembourg is bordered by Belgium, France and Germany — and is one of the world’s smallest countries. Property prices have significantly dropped, falling to their lowest point since the end of 2020, according to the Luxembourg Times. ‘The price of housing continued its downward trend for the fifth consecutive quarter, with the average price for a house or a flat contracting by 14.4% in the last quarter of 2023 year-on-year,’ the outlet indicated.”
The Globe and Mail. “As late as last year, well into a real estate crisis that began in 2021 with the collapse of property developer Evergrande, Beijing-based realtor Zhang Yuan was closing at least one deal a month. So far this year, however, he has sold just two properties – and the second sale almost slipped through his fingers. ‘The real estate market is obviously cooling down,’ Mr. Zhang, 23, told The Globe and Mail. ‘The contrast with last year is huge.’ According to official data, China has some 390 million square metres of completed and unsold homes, equivalent to 6.6 Manhattans. One survey of 14 cities found the number of properties listed for sale was 20 times higher than the number of transactions that month.”
“‘We see more homes being listed, but the number of actual buyers is far less,’ said Mr. Zhang, the Beijing realtor. ‘The biggest concern for buyers is that the market is not stable, as house prices keep fluctuating. What should they do if the house they buy continues to depreciate? Nobody wants to see such a loss.’ Meanwhile, he added, many owners fear that ‘if they don’t sell their houses now, they will miss the last chance and won’t be able to sell at all.’”
“Ryan Liu knows this feeling well. In October, the 52-year-old listed an apartment he owns in Beijing for 4.2 million yuan ($792,000). Other homes in the area had sold for similar prices, records showed, and a few years ago the apartment would likely have been snapped up in no time, despite being in a relatively old building far from the city centre. By April, however, a disgusted Mr. Liu took down the listing after receiving just two offers, both of which came in at a million yuan below the asking price. ‘There have been too many housing policies introduced this year. The market is cost-effective for buyers, but for sellers it is too unfavourable,’ he said. ‘I think that if I accept this crazy devaluation, I would definitely regret it in a few years.’”
“Still, he said he couldn’t help feeling some of the anxiety that is driving other sellers to take huge haircuts. ‘Even though I say I don’t want to lose money, and I won’t settle for losing one million yuan, I still worry sometimes that the price could go even lower.’”