A report from the New York Post. “‘Don’t panic,’ said Jacob Channel, a senior economist at LendingTree. ‘What you absolutely shouldn’t do in a period like this is panic and think the sky is falling. If you do that, you’re more likely to make risky decisions like panic-selling all of your stocks or rushing into a bad real estate deal.’”
From Axios. “After getting laid offfrom her job at mortgage provider Better.com in March, Charmaine Steele interviewed at eight other mortgage companies. Each one subsequently announced layoffs of their own, she tells Axios. At least one has gone out of business. It was a grim job search, says the 30-year-old Steele, who lives in Charlotte, North Carolina. ‘Nobody was hiring anybody.’ On Tuesday, real estate brokerage Compass announced the second round of layoffs. Just the day before, Opendoor — which is in the business of buying and flipping houses — announced it lost money on 42% of its transactions in August.”
“Steele says she was earning around six figures at Better.com, her first job at a lender after working as a real estate agent. She’s now working in the small business lending space, making 50% less.”
From Bisnow. “Duke Realty is set to be acquired by Prologis in a $25.6B megadeal, but when the Indianapolis-based real estate investment trust’s board voted to be sold to its West Coast competitor, its CEO said it was one of his lowest moments. ‘Worst [expletive] day of my life,’ Duke CEO Jim Connor told the Indianapolis Business Journal about informing his staff that the company was being sold, adding that it was the right business decision. ‘I was standing there, with a 50-year anniversary banner across the front of the building at my back, talking to our team — people that I’ve known for [decades] and people that had built this company and done all the incredible heavy lifting,’ Connor said. ‘I had to stand up and tell them that the decision had been made and that it was going to happen.’”
Fox 7 Austin in Texas. “‘We haven’t seen this much inventory since 2012,’ said Ryan Rodenbeck. ‘I think that we’re going to see a return to a normal market in spring, and what I mean by that is, a real normal market where we don’t have sellers that are putting properties on the market and getting 50 offers,’ he said. ‘I would say that this is no time to be panicking.’”
The News Tribune in Washington. “The days of Tacoma being among the hottest real estate markets in the nation are now a distant memory. Redfin listed Tacoma as among the top markets cooling the fastest in the nation. ‘Seattle’s housing market is slowing faster than any other housing market in the country amid rising mortgage rates, inflation, a slowing stock market and broad economic uncertainty,’ Redfin reported. After Seattle, Las Vegas came in second, followed by San Jose, San Diego, Sacramento, Denver, Phoenix, Oakland, North Port (Florida) and Tacoma.”
WSMV Nashville in Tennessee. “‘The tough part now is that buyers are going to be paying more for their homes, but I don’t think we’re going to see the bidding wars like we’ve been seeing multiple offers, homes have been staying on the market longer. They’re not being seen or shown as quickly as they were in the past,’ said Debbie Hovsepian, a realtor with Parkwood Brentwood Realty. Hovsepian shared a recent example of how interest rates impacted a client looking to purchase a home. ‘The rates were lower when we made the offer, and the seller did not respond in time, and we had to rewrite the offer. This time we rewrote the offer considerably less than what we came in at in the first place—that’s to fill in the gap.’”
Hawaii News Now. “The rise in interest rates is just one of the forces on Hawaii’s real estate market. More home sellers are cutting their asking price. ‘If they don’t get an offer soon, they’re going to drop their price because they realize, ok, the Federal Reserve just made it even more expensive to buy my property,’ said Bryn Kaufman, principal broker at Oahu Real Estate. The site said the number of sellers who reduced their price went up from 234 in February to nearly 600 in August.”
From Consumer Affairs. “Whether you’re buying or renting a single-family home, prices are retreating from their historic highs. Alex Platt, principal agent with part of Compass Real Estate in Boca Raton, Fla., has seen activity slow in the upscale coastal market, halfway between Miami and Palm Beach. ‘Six months to a year ago, it was on fire,’ Pratt told ConsumerAffairs. ‘There was no inventory, everything was selling off-market, there would be bidding wars. It’s not like that anymore, those days are gone. The banks have gotten smart, they know houses have value and they aren’t just giving them away,’ he said. ‘Now, banks would happily take the home in a foreclosure because the value is higher than what people owe on it.’”
KPHO Phoenix in Arizona. “Dean Wegner is a Scottsdale mortgage broker with Guardian Mortgage and been in the lending business for more than two decades. Wegner says Maricopa County is no longer a seller’s market like it was. ‘Back then we saw sellers were bullies. You had two weeks to buy the house and it was non-refundable,’ Wegner said. ‘Guess what? Now they’re flexible. They’re not getting a lot of showings.’ With interest rates now around 6%, Dean says buyers are no longer bidding over the asking price. In fact, since June he says the average selling price in Maricopa County has dropped 12%.”
KRON in California. “Home sales are currently down 29% compared to the same time last year. Bay Area home prices have also dropped and are down 4.2% year-over-year. Tim Yee, the president for RE/MAX Gold Bay Area says, ‘As schools open and life returns to ‘normal,’ it seems that the previously overheated real estate market is also returning to a state of normalcy.’”
CBS Los Angeles in California. “Real estate agent David Smith said he’s had to make price adjustments on his listing in Woodland Hills after 65 days on the market. He added that sellers have to manage their pricing expectations while buyers are in the driver’s seat, essentially making it a buyer’s market now. ‘I don’t know how much further they can actually fall from where they are right now but I think it will stay low for some time,’ he said.”
The Globe and Mail in Canada. “In the slouching Toronto-area real estate market, figuring out which seller is motivated to sell at a discount is a game patient buyers are prepared to play. One of the tactics is the deployment of a lowball offer. ‘I’m the only game in own if you want a 30-footer in Bedford Park. They’re not going to give away the house,’ broker Andre Kutyan says. ‘Before a seller drops their pants significantly, they’re going to see what happens in the market.’”
“That same day, a first-time buyer submitted a lowball offer for a condo near Avenue Road and St. Clair Avenue West with an asking price of $2.849-million. The purchaser had backing from the ‘bank of mom and dad,’ he says. ‘It’s a stink bid – they are trying to steal the place.’ The two sides could not come to an agreement and the buyer disappeared.”
South China Morning Post. “Chinese property developers Excellence Group and China SCE Group Holdings are set to issue bonds indirectly backed by the government, amid the gloom that continues to shroud the sector. More time and help is needed for developers to have a positive cash flow, said Bruce Pang, head of research, Greater China, at JLL. ‘Yuan bond issuances are a good way considering that they cannot raise more in offshore markets.’”
Reuters on Hong Kong. “When Stephanie Cheung bought a small, two-bedroom apartment for HK$7.7 million ($981,041) as an investment in April 2021, she booked a 6% gain by the summer as Hong Kong’s property market boomed to historical highs. The price surge was driven in part by optimism that Hong Kong’s borders would reopen after some of the world’s most stringent COVID-19 measures over the past two-and-a half years. Today, none of that has materialized.”
“The price of Cheung’s 450 square foot flat has dropped 6%, and the rental income of HK$16,300 is no longer enough to cover mortgage repayments after monthly interest increased by HK$2,400 a few months ago. ‘I made the purchase hoping to reserve capital, but now I just wanted to use the shortest time and the smallest loss to sell this apartment,’ said Cheung, 40, who lives in a bigger rented apartment with her family.”
“Cheung is now set to book an even bigger loss, after some banks on Thursday raised their interest rate by 12.5 basis points, the first rise in four years. Cheung’s is not an isolated case as rising mortgage costs and a bleak economic outlook have deepened pessimism among homeowners. Property agents said prices had dropped more than 7% so far this year to levels not seen since the third quarter of 2018. ‘The gains over the past four years have been wiped out in four months,’ said realtor Hong Kong Property Services chief operations officer Dave Ma.”
“Many sellers are those leaving Hong Kong for good or residents forced to cash in to help struggling businesses. Developers are also cutting prices, with some selling new projects at discounts of up to 20%. Momo Chan, 35, a civil servant who bought a home last April before getting married, also said reopening borders is crucial to support the housing market. ‘I had expected interest rates to rise and the market would not keep going up, but I thought it would be stable, not a big fall like this in the last few months,’ Chan said.”