It’s Friday desk clearing time for this blogger. “After five months on the market, Leonardo DiCaprio has found a buyer for his Los Feliz home. The actor listed the property for $5.75 million in August, but after a series of removals and re-listings, $4.895 million is what DiCaprio has landed on. The final figure is just under the $4.91 million he paid for the home when he purchased it in 2018.”
“The site of a big affordable housing development in downtown San Jose that never got off the ground is headed for an auction and foreclosure as soon as February. The property that is headed towards foreclosure on its loan if the lender is unable to auction off the site is located at 199 Bassett St. in downtown San Jose. The proposal for the site envisioned a co-living residential development where 803 units would have sprouted in an up-and-coming neighborhood in San Jose’s urban core. Construction never got underway on the project, however, and the lender is threatening to foreclose on the loan and seize ownership of the property, which is near the corner of Bassett Street and Terraine Street.”
“Tantalizing tales of massive purchase and asset appreciation have inspired many firms, brokers and speculators trying to find a way to get in on metaverse real estate — in which pieces of digital space are turned into nonfungible tokens and transferred like a deed — despite the technology and graphics of early virtual worlds lagging behind the hype. ‘Right now in the virtual real estate space, you see a lot of people just are executing on FOMO,’ said developer Jay Gaudet, using the acronym for ‘fear of missing out.’ ‘I want to be a part of it. I don’t necessarily know what I’m going to do with it afterwards, but I want to jump into it.’”
“Back in the day — we’re talking two or three years ago — the sweet spot for Fort Collins home buyers was between $450,000 and $500,000, a point where competition thinned and escalation clauses, appraisal gap coverage and inspection waivers were unnecessary. ‘Now, for a million dollars you can have a really nice tract home,’ added Will Flowers, managing broker with The Wentworth Co.”
“Ken Smith bought a house outside Carleton Place with a big country lot last fall for $465,000. Smith, 32, is a broadcast engineer who works in downtown Ottawa. Smith learned the house had sold for less than half the price in 2018, but it fit his budget and was a 40-minute commute to work. ‘I’m just happy I’m in a house and not on the sidelines watching,’ he said. ‘It’s the wild west in the real estate market. Maybe everything will crash.’”
“A major developer behind plans for 900 homes in Salford has gone into administration. Beaumont Morgan Developments was the firm set to demolish former office buildings at Furness Quay to make way for two new apartment blocks. The original plan was to convert the buildings into housing, but this was scrapped over ‘insurmountable challenges’ which made the proposals commercially nonviable.”
“There have been falls in prices in some luxury housing markets across Spain, such as Naut Aran, where owners’ asking prices for their homes have fallen by 13.7% and remain below the 4,000 euros/m2 mark. Two Barcelona neighbourhoods (-12.5%) have also fallen compared to the prices seen in 2019. It is worth noting that two of the five most expensive areas in Spain have seen prices fall by double digits. Some of Madrid’s most expensive districts have also registered decreases in their prices, accompanying the aforementioned falls in Barcelona, a reflection of the general data for the entire housing market in both capitals.”
“At this level it becomes a serious challenge for many workers to save for a deposit from their earnings, even if they have slashed spending on travel and entertainment during two years of stop-start coronavirus restrictions, and had been knuckling down to save even earlier. A deposit on a median-priced Sydney house, for example, is now the equivalent of 14,559 plates of avocado toast.”
“Is it sustainable? Aside from the issue of potential buyers finding fewer and fewer options they can afford, interest rates are likely to rise sooner than once thought. When interest rates rise, property prices are likely to peak and then go into reverse, as potential buyers will be able to borrow less, Commonwealth Bank head of Australian economics Gareth Aird expects. ‘We’ve seen that on the way down, [as rates fell] house prices went up and to some extent the reverse will be true. When interest rates go up that will reduce credit and that will weigh on home prices,’ he said. ‘Rate rises this year are far more likely than not and the strength of the inflation data suggests they may not be too far away.’”
“Los Angeles-based Oaktree Capital Management has stormed a Hong Kong ‘castle’ valued at $1 billion. The global asset management firm has seized a 2.2 million-square-foot plot known as ‘Project Castle,’ where the chairman of China Evergrande Group hoped to construct a colossal mansion. The move to seize control of the asset this week sank a plan by Evergrande to restructure $20 billion in offshore debts. The seizure, made through a receiver, came after the struggling Chinese developer defaulted on a loan against which the $166-billion asset manager had security, according to two people familiar with the matter.”
“The project was key collateral in a planned restructuring of Evergrande’s giant offshore debt load, according to one of the people. But the plan is now in disarray after Oaktree appointed a receiver. The appointment of the receiver must be approved by a Hong Kong court, after which the asset would be removed from the general restructuring of Evergrande. Such a turn of events could complicate Evergrande’s attempts to restructure.”
“‘Evergrande has got the offshore bondholders to stop making noise on the basis there’s a restructuring process coming soon,’ said this person. ‘That land was going to be used to facilitate the restructuring.’”
“Chinese stocks extended their nearly $1.2 trillion rout this month even as mutual funds, state media and companies all intensified efforts to support the market. ‘Confidence and sentiment is dwindling as stocks fall, and when the market is so bearish, we can only count on the momentum to naturally peter out,’ said Hou Anyang, fund manager at Frontsea Asset Management. ‘The skepticism on growth is mainly due to property, there isn’t any industry that can take up its role right now.’”