A report from Market Watch. “Airbnb had been on track for its biggest drop ever, falling more than 13% in intradrading and becoming the worst performer in the Nasdaq 100, according to Dow Jones and FactSet. Its shares have never declined more than 9.1% in a single session, with that record set nearly a year ago, on Feb. 25, 2021. The stock of the lodging-booking company had dropped in six of the past seven sessions.”

The Aspen Daily News in Colorado. “The city and county are wishfully ­thinking that vacation-rental units can somehow be limited to ‘true locals’ who reside on the property and need the money to remain in Aspen. An additional income stream presumably would slow the gentrification wave that has transformed 68% of free-market units into vacant places. Much of the property here is owned by corporate entities, primarily LLCs. LLCs are a form of partnership that can admit as many partners as deemed useful. And LLCs and other entities do not have to disclose their ownership. Mitt Romney famously said corporations are ‘people.’ And people they are — in the sense that zombies and vampires are — capable of eternal life and with no interest in community other than profit.”

From CBS Miami in Florida. “Nearly 6,000 new apartments and more than 2,500 condos are under construction in the city of Miami. From Wynwood to Brickell and downtown to Miami Beach, cranes and construction are everywhere. ‘Everybody wants to be here, we’re an extremely desirable city which is a great thing. We don’t want to be less desirable but it’s also creating a bit of a supply glut, raising prices a little bit because a lot of people want to come,’ says the Mayor of Miami, Francis Suarez.”

From Gothamist. “A week after a pandemic-era moratorium on evictions ended, thousands of low-income New Yorkers behind on rent sought help from an emergency rent relief program, illustrating that many more households are at risk of losing their homes. Jay Martin, executive director of the Community Housing Improvement Program (CHIP), a group made up of about 4,000 owners of mostly rent-stabilized units, said landlords are not rushing to housing court to file eviction notices.”

“According to CHIP, the average rent owed is about $20,000 – accumulated during the nearly two-year-long pandemic – and Martin said landlords are not likely to recover the money if they evict their tenants now. ‘These workers won’t have the financial resources to pay these debts back anyway,’ said Martin.”

The Advocate in Louisiana. “Calcasieu Parish continues to be among one of the nation’s most troubled housing markets in the country with more than 1 out of every 5 homes classified as being underwater at the end of the third quarter last year. ATTOM indicated of the 22,898 properties in the parish with loans, 5,021 were classified as underwater. Two northern Louisiana parishes were nearly as high as Lake Charles: Caddo at 21.4% and Ouachita at 20.8%, both in the top 20 nationwide.”

“Nationwide, New Jersey, Illinois and parts of California had the highest concentrations of the most at-risk markets with the biggest clusters still in the New York City and Chicago areas. The western U.S. remained far less exposed outside of California.”

The Philadelphia Inquirer. “In a couple weeks, New Jersey homeowners struggling because of the pandemic will be able to apply for about $326 million in federal funds to help them stay in their homes, Gov. Phil Murphy announced. The New Jersey Housing and Mortgage Finance Agency expects to help 7,000 to 10,000 households with current funding but will aim to stretch funds as far as it can, said Melanie R. Walter, the agency’s executive director. ‘We’re aware there could be 100,000′ people who need help to make their housing payments,’ she said. She acknowledged the high price of housing in New Jersey compared to other states.”

The City Journal on California. “Locals sometimes call San Francisco’s Tenderloin neighborhood ‘Hamsterdam.’ The name comes from the third season of HBO’s The Wire, in which a Baltimore police commander unilaterally designates an area of his district where his officers would turn a blind eye to the selling and using of drugs. The fictional depiction of Hamsterdam is horrifying—’a village of pain,’ one character calls it. For Tenderloin residents, that portrayal is a reality. And now it’s not just happening on the streets: San Francisco is operating a rogue and unlawful drug-consumption site. In January 2021, the Third Circuit ruled that such supervised consumption rooms are illegal under federal law, as per the Controlled Substances Act.”

“What is happening inside the Linkage Center mirrors what is happening outside. The facility is located near Civic Center Plaza, where hundreds of dealers and users congregate night and day. Throngs of addicts stand around in a daze, yell incoherently, or slump themselves over on the ground. They use drugs out in the open, jabbing needles into appendages, puffing on pipes, and inhaling from burning foil. Across the street stands a luxury condo building with units for sale and empty office buildings.”

From Bloomberg. “An increase of more than one percentage point in the central bank rate — traders in Toronto are expecting a point and a half — would backfire on homeowners, driving the cost of their mortgages above that currently offered on conventional fixed-rate loans. To old hands in the housing market, the elements at play here — overstretched buyers suddenly hit with surging borrowing costs — are a cocktail for trouble. And while predicting a crash in the Canadian housing market has been an embarrassingly bad idea for two decades now, some are mustering the courage to raise the specter anew.”

“‘If the Bank of Canada goes at least as far as what the rates market has priced in, you’re going to have arithmetically at least a 25 per cent plunge in residential real estate values,’ said David Rosenberg, an economist who predicted the 2008 U.S. housing crash and now runs his own analytics firm.”

“If anything, he says, the market may be underestimating, not overestimating, the number of rate hikes that could be coming if the Bank of Canada panics in the face of the fastest inflation in 30 years. ‘There’s a greater risk that they over-tighten, and they might over-tighten by even a couple of rate hikes.’”

“It’s investors, whose participation in the housing market has grown faster than any other kind of buyer, who are more likely to sell, said Rosenberg. As of mid-2021, investors accounted for a fifth of all homes purchased in Canada. Investors look at their properties as a source of profit, so they may have fewer qualms about selling than owner-occupiers when the economics turn less favorable, research by the Bank of England has suggested. Plus, the greater proportion of debt investors carry relative to their income may make them even more sensitive to changes in interest rates, according to research from the Bank of Canada. And in late 2020, about 40 per cent of investors were only breaking even — making that group completely reliant on price appreciation to earn a return.”

“‘The investors tend to be leveraged up to the eyeballs,’ Rosenberg said. ‘That’s where the selling is going to initiate, but it will spread like dominoes.’”

“Last month, Lori Babyk, a 48-year old product manager at an industrial supply company, spent just shy of $1 million on a townhouse in the Toronto suburbs. The low rate on her variable-rate mortgage, just 1.35 per cent, was a help given the sticker price. ‘With where I am now and where my monthly payments are, I can live fairly comfortably and not have to worry,’ she said. ‘If things went much higher I’d have to be a lot more concerned with what’s coming in and what’s going out.’”

“If rates do rise, Babyk says she would cut spending elsewhere and continue paying down her loan to make sure she can be mortgage-free by the time she retires. The danger for the Canadian economy would be if the millions of homeowners who’ve piled into variable-rate mortgages all engage in the same belt-tightening at the same time. Such a hit to aggregate consumer spending could end up putting some people out of work, and if Babyk became one of them, she says keeping up with rising mortgage payments might become tough.”

“‘I wanted to take advantage of what I could now,’ Babyk said of opting for her floating-rate mortgage over fixed. ‘I keep telling myself, at the end of the day, I can sell.’”

From Forbes. “The days of property moguls dominating China’s wealth rankings appear to be at an end.Beijing’s campaign to roll out nationwide real estate reforms has been particularly costly to the founders behind the country’s top three property developers by sales who have seen their collective fortune plunge by $30 billion since the World’s Billionaires List was published in April.”

“‘Real estate will probably be turned into utility-like public services,’ says Hong Hao, head of research at Bocom International in Hong Kong. ‘Profit margins will be limited and no one will be allowed to make big money.’”

From Bloomberg. “China Evergrande Group urged offshore bondholders not to adopt aggressive legal action over repayments, after a group of its overseas creditors threatened to take enforcement measures. The developer’s note due 2022 is indicated at about 16.6 cents on the dollar Tuesday morning, Bloomberg-compiled prices show. Evergrande, saddled with $305 billion of liabilities as of mid-2021, was deemed to be in default in December after missing dollar-bond payments.”