A report from Curbed Boston in Massachusetts. “It looks increasingly like a buyer’s market in the Boston area. Such a trend would’ve been laughable a short while ago, but new numbers for October from the Warren Group and the Greater Boston Association of Realtors seem to confirm the shift. Detached single-family sales cratered in October, according to the statistics, which analyzed closed deals in Boston proper and 63 municipalities in its orbit. ‘A late summer slowdown in the market is not uncommon, but this year it was more pronounced,’ said Jim Major, president of the Greater Boston Association of Realtors.”
“More choice is behind the paltry sales numbers, as properties languish on the sales market longer and potential buyers watch prices fluctuate. Those buyers have basically adopted ‘a wait-and-see attitude until prices settle,’ Major said. So is the advice now sellers beware? Looks like it. ‘Our years-long seller’s market appears to be coming to an end, as market conditions begin to shift more and more in favor of buyers,’ Major said. ‘As supply and demand continue to become more balanced, buyers can xpect increased bargaining power and a wider selection of homes to choose from, while home sellers will find more competition and may need to become more realistic in their pricing to sell their home in the desired time frame.’”
From Reuters. “Sales of new U.S. single-family homes unexpectedly fell in October following recent strong gains. The median new house price fell 3.5% to $316,700 in October from a year ago.”
From Mansion Global on New York. “Thirty Manhattan homes asking $4 million or more found buyers in the week ending Sunday, the strongest week for the city’s anemic luxury housing market in nearly a year and a half. A confluence of positive economic conditions is driving the boost to high-end home buying, according to Donna Olshan, president of Olshan Realty and author of the report.”
“The most significant among them are widespread discounts on the city’s priciest home as sellers adjust expectations amid a more onerous tax regime and a supply glut that spawned crushing competition among developers and resellers. So far this year, the average home asking $4 million or more has gone into contract with a 10% discount.”
From RE: Miami Beach in Florida. “The big Miami Beach real estate story this week was the bombshell announcement that Purdy Lounge will close its doors for the final time in February. In a much quieter fashion, a number of other Sunset Harbour businesses have closed or are winding down.”
“‘I feel it’s real estate investors unrealistic expectations of what mom and pops can pay for rent. These investors overpay for real estate with the delusion that they can substantially raise rents to increase their returns,’ said Dominic Cavagnuolo, owner of the popular Lucali restaurant.”
From Senior Housing News. “It’s been an eventful and in many ways difficult year for the senior housing industry — and it’s not over yet. We’ve compiled some of the most vivid and powerful quotes that appeared in Senior Housing News this year. ‘It’s a time to throw spaghetti against the wall.’ — Beth Mace, chief economist at the National Investment Center for Seniors Housing & Care (NIC), April 24, 2019.”
“The study quantified that the number of middle-income seniors will nearly double to 14.4 million by 2029, and 54% of them will not have the financial resources for private-pay senior living if today’s rates hold. That’s the data, and then there’s how senior housing pioneer Bill Thomas described the opportunity at Senior Housing News’ inaugural BUILD event: ‘The largest growth opportunity in the field of senior housing is not high-end, highrise high-amenity, urban infill properties. It’s frickin’ America … where people want to live where they want and how they want, but don’t have the housing that makes it possible.’”
From Columbus CEO in Ohio. “Options abound for seniors who may need a continuum of care as Central Ohio’s robust retirement community and assisted living market evolves. Standalone assisted living properties ‘are coming up on every corner,’ says Mark Ricketts CEO of National Church Residences, which owns and operates more than 300 communities. Whether the market will bear the increased inventory remains to be seen, Ricketts says, but he does have concerns that it is being overbuilt.”
The Atlanta-Journal Constitution in Georgia. “Senior housing had a growing reputation as a lucrative sector of real estate, and The Lodge in 2013 seemed perfectly positioned to capitalize on the aging population of Atlanta’s suburbs. The plan was straightforward: Open the assisted living community and fill it with residents, demonstrate a profit and then flip it in a few years for a healthy return. Six years later, the facility that was supposed to be a successful business venture is in bankruptcy. Occupancy suffered as the financial problems dragged down the facility’s reputation and as state inspectors cited the home for one serious violation after another, including untrained, insufficient and abusive staff.”
“‘I know that it’s just a matter of time before someone’s going to die,’ said Mondresia Carver, who managed the facility for several weeks this year but said she was let go after repeatedly expressing concerns. ‘I worry myself to death for those residents.’”
“That kind of story has been repeated at dozens of homes throughout Georgia, an Atlanta Journal-Constitution investigation has found. Fancy senior care facilities like Aspen Village popped up all over the state in recent years, especially in metro Atlanta, as money poured in from across the country and even around the globe. The building boom was made possible by a gold rush mentality among investors hoping to make money on the graying of America.”
“But the tidal wave of retirees expected to create an overwhelming demand for private pay senior care has yet to arrive. Meanwhile, the building boom increased competition, and costs shot up. The result: More than 20% of Georgia’s assisted living communities and large personal care homes had owners or operators that faced recent financial problems, the AJC found.”
“Financial stresses can trigger a range of issues for residents. To fill beds, homes may admit or keep residents whose health needs require a higher level of care than the facility can provide. Cash flow issues can lead to everything from short staffing and neglected maintenance to unappealing meals. The AJC found a host of violations, including one linked to a death, at facilities caught up in a fraud case involving Atlanta senior care owner Christopher Brogdon. He was under financial pressure because of an order to pay jilted investors $89 million.”
“Big banks and private equity funds financed new projects, as did real estate investment trusts, also known as REITs. International investors placed bets on senior housing too. At least five projects in Georgia got money for their projects from wealthy foreigners who wanted to get EB-5 visas. ‘Maybe that was naive on my part, but I don’t think we thought long-term care was going to turn into real estate investment,’ said Melanie McNeil, Georgia’s long-term care ombudsman.”