A report from Hawaii News Now. “While December went out with a bang, the median sales price for a single-family home in 2019 ― $789,000 ― was down .1% from the year before. It was the first decline in the annual median sales price on Oahu since 2012.”
The Bothell-Kenmore Reporter in Washington. “Reflecting on the last two years, John L. Scott Redmond broker Emma Mueller said buyers locally have raised the bar, which she doesn’t see changing in 2020, even if inventory tightens. ‘Sellers will have to adjust their expectations in preparing to sell their home — to compete, sellers will have to tackle deferred maintenance or even take on some larger home updating projects,’ said Mueller. ‘Even then, it may still take more than 30 days for sellers to get under contract. Luckily, I predict the continued possibility of contingent offers in 2020, particularly for luxury homes, which weren’t really available in the frenzied 2016 and 2017 markets.’”
The Boston Globe in Massachusetts. “There are growing signs that Boston’s long-running housing boom may soon start to run out of steam. Building permits for new housing in Boston fell by nearly one-quarter in 2019, city data show. At the same time, rents, while already high, aren’t increasing as fast as they were a few years ago. Together, the numbers and trends raise questions about how much longer this wave of construction can be sustained, even though more housing is desperately needed in the Boston area.”
“‘With all these things playing out, you’re putting the brakes on new development,’ said David Begelfer, a consultant who long led the real estate trade group NAIOP Massachusetts. ‘We’re basically reaching a ceiling right now.’”
“It’s a trend that Travis D’Amato, managing director at Walker & Dunlop, a Boston real estate firm, expects to continue in 2020. ‘This year is going to be a peak,’ D’Amato said. ‘If you’re looking at larger luxury buildings, this is going to be the highest year we’ve ever seen for new deliveries” of housing stock.’”
From New York 1. “The city’s skyline is always reaching higher, and now it’s undergoing its biggest transformations yet with six buildings sprouting higher than the Empire State Building in the last six years, and more are on the way. When searching the Council on Tall Buildings and Urban Habitat, NY1 found that developers are planning another five buildings taller than 1,300 feet. Real Estate Statistician Jonathan Miller says the building boom began with the financial crises of 2008.”
“‘It was the perfect storm,’ Miller tells NY1. ‘It was Wall Street hungry for higher returns, hedge funds, sovereign wealth funds, private lenders. So, capital was readily available and very inexpensive [and] looking for a home. Everybody had the same idea at the same time.’”
“Because so many new expensive apartments are coming to the market at the same time, it’s created a high end housing bubble. ‘At the end of the day, you’ve got to sell and, of course, we’re in a market that’s oversupplied,’ says Extell CEO Gary Barnett. ‘It softened, so we had to price this building a little more restrained.’”
“Prices are down 15 to 40 percent from the high in 2014 says Miller. ‘We’re looking at a housing stock that’s about 40 percent unsold.’ And of those that are sold, Miller explains, more than half are going to out-of-towners buying a second, third or fourth home, amplifying the anger of New Yorkers left in the shadows.”
From The Real Deal on Florida. “The partnership behind the Apeiron at the Jockey Club project is in tatters, amid allegations of double-crosses, a loan-to-own scheme and the sabotage of a $20 million deal, according to a recently filed lawsuit in Miami-Dade Circuit Court. Apeiron Holdings Miami and Apeiron Miami, two shell corporations controlled by developers Muyad ‘Mo’ Abbas and Michael Bedner, are suing partners Asaf Horesh, Zeev Segal and their company Jockey Segal Upland. The complaint also names Doron Arad and his company Pledger Trust Series 28 LLC as defendants.”
“Jason Koslowe, the attorney representing the Apeiron entities, said his clients faithfully managed the project’s development for five years, but Horesh, Segal and Arad are attempting to force them out without compensation. The ultra-modern 120-unit project would be built on 13 acres of common grounds at The Jockey Club, which already has three existing condo towers.”
“Robert Stok, the lawyer for Horesh, Segal, Arad and their companies, accused Abbas, Bedner and the Apeiron entities of allowing a $10 million loan to go into default and of putting the project in ‘terrible shape.’ In October, Jockey Segal Upland sued the Apeiron entities, Abbas and Bedner to block the sale and foreclose on the $10 million debt, which Arad acquired from the original lender, Romspen Mortgage Limited Partnership from Ontario, Canada.”
From Curbed Chicago in Illinois. “An ultra-opulent mansion on Lincoln Park’s Burling Street hit the market in late 2016 for $50 million, shattering the record for Chicago’s most expensive listing in the process. After three years and a $5 million price cut, the superlative single-family residence is still available. Insurance magnate Richard Parrillo and wife Michaela completed the home in 2010 and claimed to have sunk $65 million into acquiring the land and constructing the 25,000-square-foot limestone structure, which occupies more than eight standard-sized city lots.”
“In total, there are six bedrooms and 11 bathrooms. There’s a massive outdoor terrace, a secluded walled garden, and a reflecting pool. The interior decked out in custom stone, wood, gold leaf, and plaster details befitting a European palace. Even the driveway gravel was imported from France. If all of that sounds like your cup of tea, the Burling Street behemoth can be yours for a cool $45 million.”
From Palo Alto Online in California. “The residential real estate market in Palo Alto had an unprecedented strong run in the past 10 years. The median home price of all sold homes increased 2.4 times from $1.25 million in 2010 to $2.94 million in 2019, which translates to an average compound annual growth rate of more than 10%. However, there have been signs of the end of the upcycle, once in 2016, and most recently, a market that has been slowing since the spring of 2018.”
“The median price of all sold homes in Palo Alto of 2019 was $2.94 million, a 3.8% decline from 2018. The weakness is particularly reflected in the total transaction amount, which fell by 10% compared to a year ago. Homes also stayed on market 10 days longer than a year ago. It now takes an average of 29.2 days for a listed home to find its buyer. As sellers are still adjusting expectations, 2019 saw a 26% increase in price reduction. In fact, more than 23% of new listings had to lower their asking prices after being listed on the Multiple Listing Service.”
“There’ll be a healthy supply starting from the beginning of the year. There were 35 active listings in Palo Alto on Dec. 24, 2019. A large number — 61 listings — went off-market in the last quarter of 2019 and will most likely come back in early spring. There will also be fresh new listings, evident in the ‘coming-soon’ signs that began to pop up during the holidays from those anxious sellers.”