A report from the Spokesman Review in Washington. “Homebuyers in Spokane County may have an easier time finding a property in a real estate market is beginning to swing in their favor. Many area homes are undergoing price reductions. Some are remaining on the market longer. ‘We’re seeing a housing market slowdown,’ said Rob Higgins, executive officer of the Realtors association. ‘Our increase of inventory is pretty significant when compared to 2020 and 2021. The pendulum is swinging more toward buyers in that there’s more choices out there.’”
“Sales are decreasing and prices are softening from record highs seen earlier in the year. The median closing price for homes and condos on less than 1 acre was $416,450 in August, a 7.6% increase from $387,000 in August 2021. Last month’s median, however, was a drop from $419,950 in July and the all-time high of $450,000 in May, according to data from the Spokane Association of Realtors.”
The Colorado Sun. “Buyers are no longer snapping up houses within 12 days of hitting the market in Denver. They’re waiting 21 days. They’re not paying more than the seller originally asked for. Median sales prices have also dipped each month this year since May, according to the organization’s data. Between May and August, the median sales price in Colorado fell 4.8% and 4.6% in Denver. ‘I hate it when people say the market is crashing because what I always will respond is: ‘To whom?’ said Matt Leprino, head of real estate brokerage Remingo in Denver. ‘It’s a great, great opportunity. It’s better than it’s been in three years for buyers.’”
Sarasota Magazine in Florida. “The latest numbers point to a cool-down. According to August data from the Realtor Association of Sarasota and Manatee (RASM), the local housing market showed a decrease in sales and a rise in the median number of days from listing date to contract. At the end of August, there were 4,288 active listings combined in the two counties, a 133.6 percent increase from last year. Prices are shifting both ways. In Sarasota County, the median sale price for single-family homees increased year-over-year by 21.8 percent to $475,250—but that’s lower than the record-breaking price of $525,000 in July.”
“What is notable, however, is that for the first time since March of 2021, the median percent of single-family homes sold at or above the original list price was reported below 100 percent in the North Port-Sarasota-Bradenton area, dropping by 2 percent to a 98 percent list-to-sale ratio. Although it’s still a good time to sell, Sarasota realtor Brandy Coffey points to a few things that have changed with sellers. ‘Compared to the last two years, we’re no longer seeing waived contingencies, regardless of price point,’ she says. ‘In the past, it’s as though buyers had a fear of missing out and were rushing in.’”
“‘We’ve been playing catch-up. During the last two years, it almost didn’t matter how you priced a home, you would get bids,’ Coffey explains. ‘Now, if you’re motivated to sell, listing it slightly under market value is best to gain more offers. It’s best if homes are showroom-ready. People weren’t concerned how things looked and would buy just about anything, but that’s now changed.’”
News 5 Cleveland in Ohio. “Realtor Jessica Chodaczek told News 5 that the cooling down appears to have already started, impacting homes that are in the process of closing. She said that means sellers’ expectations have to change. ‘Houses are sitting on the market a little longer than they were and we’re seeing a lot less multiple-offer situations,’ she explained. ‘Inventory is still low compared to the last several years, however [sellers] have to be realistic that their experience selling in the fall is going to be different than their neighbors who sold in the spring.’”
From Columbus WTVM. “‘Now we’re seeing rates that are comparable to what we were seeing around 2008 when the market kind of took a tumble there,’ said Norman Hardman. Hardman is a licensed realtor in Georgia and Alabama. He says the average price for a home in Columbus is around $200,000 saying, ‘It’s not uncommon to see a home start at a certain list price and for it to be reduced by like $20,000 until they meet the price that buyers are ready to pay for that home.’”
The Union Tribune in California. “Price reductions at the luxury level tend to be quite high. Here are a few examples: 2681 Idle Hour Lane: This nine-bedroom mansion in La Jolla was listed for $23.5 million in January. It has had its price reduced several times and is now listed for $18.9 million. 13985 Old El Camino Real: This five-bedroom mansion in Carmel Valley, on an 18.6-acre lot, went on sale for $19.9 million in late February. It is now listed for $16 million. 16701 Camino Sierra Del Sur: This 10-bedroom mansion in Rancho Santa Fe was first listed for $23.9 million in July. It is now on the market for $14.8 million.”
“San Diego luxury real estate agent Brett Dickinson’s view was that the luxury market was fine and going back to normal after a particularly crazy pandemic buying season. For example, he said there were about 45 single-family homes for sale in La Jolla about two months ago, but there are now around 90. Dickinson said it’s easy to freak out that inventory is shooting up, but it ignores that there are normally around 150 to 200 homes for sale around this time.”
The San Francisco Chronicle in California. “Some of San Francisco’s most expensive real estate has had its sticker price slashed in the past month. Three listings, all in Pacific Heights, have had price cuts of $10 million or more, dashing hopes of record-breaking sales and instead pricing to sell in a cooling market. The penthouse at 2006 Washington St. was the first to cut its price and is still the city’s most expensive listing at $35 million, down from an original list price of $45 million. The 10th-floor unit came on the market in October 2021 and would have broken both the city’s sale price and price per square foot records if it had sold.”
“The 1924 co-op is a coveted city address, but it must not be enticing enough, as a lower-floor listing at 2006 Washington St., Apt. 2, had an $11 million price cut published the day after the penthouse was reduced. Dropping from $30 million to $19 million, the 7,808-square-foot condo spans two floors and includes six terraces. It has its own private entrance, oversized windows and massive living spaces and is on the market for the first time since 1999. Just this week, 2950 Pacific Ave. came back on the market after disappearing in June at an original list price of $29.5 million. It reemerged for $20 million — but that’s for a home that doesn’t even exist yet. What is actually 2895 Broadway comes with ‘fully approved architectural plans and building permits’ and is ‘shovel-ready,’ utilizing the existing home and expanding its footprint.”
From NBC DFW. “The Dallas-Fort Worth housing market has been super hot for the last couple of years, but those in the housing industry say recent trends indicate the market may be cooling down. The stiff competition in North Texas and across the state to buy a home was due to a low inventory of homes, causing buyers to purchase quickly and way over the asking price. ‘The craziest one I heard is someone offered to give the seller an RV if they would accept their offer,’ said Shana Acquisto, president-elect of the Collin County Association of Realtors.”
“She says those situations aren’t happening as much these days as the market shifts due to higher interest rates and more inventory available. ‘The market is cooling somewhat, but I don’t panic at all. I think the rate increase is good and it’s doing what it was meant to do, which is stabilize and cool off our market, it was just out of control,’ said Acquisto.”
“In Collin County, the August housing report said buyers had 77.3% more inventory to choose from compared to a year ago. ‘We are seeing you know, more homes come into inventory, which means more opportunity for buyers. And we are seeing some price reductions because if a seller needs to sell they’re having to do something to entice a buyer,’ said Acquisto.”
From Bloomberg. “Week by week, the bond-market crash just keeps getting worse and there’s no clear end in sight. Prices are tumbling as traders race to catch up. And with that has come a grim parade of superlatives on how bad it has become. ‘Bottom line, all those years of central bank interest-rate suppression — poof, gone,’ said Peter Boockvar, chief investment officer at Bleakley Advisory Group. ‘These bonds are trading like emerging market bonds, and the biggest financial bubble in the history of bubbles, that of sovereign bonds, continues to deflate.’”
The Free Press in Canada. “August market updates have given realtors a reason to believe Winnipeg’s housing market is normalizing, not crashing. ‘So you had all this purchasing power and crazy amounts of demand but you had like 30 per cent less inventory of homes to buy, so that’s why anything that was out there was selling,’ said Sandeep Singh, a fourth-year realtor with Royal LePage. For that reason, Singh, 31, called the two-plus years of COVID-19 the ‘Armageddon era.’”
“But now the market is normalizing in more than one way. Winnipeg experienced a two per cent increase in new listings in August, while 63 per cent of single-family homes sold for under the list price (29 per cent went for above list price). Singh has found himself reminding sellers to be patient during these competitive times. In 2021, houses were nearly guaranteed to sell within the first seven days of being listed. The new normal, he said, is anywhere from 18 to 25 days.”
From Reuters. “For six months, home for Ms. Xu has been a room in a high-rise apartment in the southern Chinese city of Guilin that she bought three years ago, attracted by brochures touting its riverfront views and the city’s clean air. Her living conditions, however, are far from those promised: unpainted walls, holes where electric sockets should be and no gas or running water. Every day she climbs up and down several flights of stairs carrying heavy water bottles filled with a hose outside.”
“‘All the family’s savings were invested in this house,’ Xu, 55, told Reuters from the Xiulan County Mansion complex, her room bare except for a mosquito net-covered bed, a few necessities and empty bottles on the floor. She declined to give her full name, citing the sensitivity of the matter. Xu and about 20 other buyers living in Xiulan County Mansion share a makeshift outdoor toilet and gather during the day at a table and benches in the central courtyard area.”
“They are part of a movement of home buyers around China who have moved into what they call ‘rotting’ apartments, either to pressure developers and authorities to complete them or out of financial necessity, as numerous cash-strapped builders halt construction amid the country’s deep real estate slump. Construction stopped in mid-2020, which Xu found out months later, describing her feelings at the time as ‘crashing from paradise.’ Xu, who is unemployed, said she bought the apartment for her only son, with the hope that he would be able to raise a family there. She said her son and her husband, who live far away in the northern province of Hebei, blame her for their financial predicament, and no longer speak to her.”
The Guardian. “China Evergrande Group, is all too well known as the poster child of the country’s economic woes. House prices in China have fallen in each of the 12 months since Evergrande’s now prophetic warning, with Xi Jinping’s government now preparing to throw billions of dollars at a property market that experts say increasingly resembles a giant Ponzi scheme. Nearly a third of all property loans are now classed as bad debts – 29.1%, up from 24.3% at the end of last year, according to research by Citigroup this week – with once safe state-owned property developers driving the increase.”
“It resembles a Ponzi scheme where money taken from new investors is used to pay off existing clients in an ever-decreasing spiral to collapse. It is even how the sober pages of the Economist sees it. George Magnus, an associate at the China Centre at the University of Oxford, said the Chinese market was not quite a classic Ponzi scheme in the style of Bernie Madoff’s notorious scam that was exposed after the global financial crisis, but it was very similar.”
“‘Developers raise huge amounts money from customers to basically fund the purchase of the next construction projects. This continues on and on before it has got to the size it has,’ Magnus said. ‘It’s not strictly a Ponzi in the asset management sense, the Madoff style, but they’re essentially using clients’ money to fund the next project, so yes, it’s the standard definition of what that means.’”
“‘There’s what they can do and there’s what they will do,’ said Anne Stevenson Yang, a China expert. ‘What they can do is to transfer money to households such as by gifting apartments, allowing people to live in places where mortgages are unpaid, and boosting pensions so people have confidence and spend again. But that’s not of course what is going to happen. The Chinese political system is not built around individuals, it’s built around companies, they are the constituents. The political system operates through them. The property market was not designed to be a Ponzi scheme – a Ponzi scheme needs to be designed. But it is an investment bubble. And the bubble has ended.’”