It’s Friday desk clearing time for this blogger. “Has a herd mentality taken hold of buyers in the Toronto-area real estate market of early 2020? Jeffrey Wagman of Forest Hill Real Estate Inc. fears it has. Mr. Wagman points to one sale in Roncesvalles Village that produced an eye-popping $1-million premium to the asking price. Agents are still buzzing about the deal and Mr. Wagman expects the news will make the rounds at the gym and during dinner parties. Mr. Wagman points out that the unbridled run in early 2017 was followed by nearly two years of turmoil. Homeowners in the suburban 905 area code couldn’t sell their houses or close deals already struck, he points out.”
“Early in the summer of 2019, the herd decided it was time to move on, he says. ‘Finally in May or June, people had had enough of it. Away they went.’ Mr. Wagman is concerned about future sales in and around the house at 63 Constance St. that sold for $2.3-million, or more than $1-million above its asking price of $1.298-million. ‘What happens to the next house,’ he asks. ‘That owner’s expecting the exact same result.’”
“Figures published this week showed that just over 21,000 homes were built in 2019, a significant increase compared to the 18,000 completed the previous year. Dublin and the mid-east region of the country accounted for half of these new builds. Orla Hegarty, a lecturer in architecture at UCD said that Ireland is repeating what happened during the Celtic Tiger, when hundreds of low-density estates were built around Dublin.”
“‘We’re making all the same mistakes again — nothing was done to prevent this from happening and it will only get worse,’ she said. ‘It’s like a business — if you have the wrong targets, you do the wrong thing. By saying supply at any cost was the objective, you go back to the problems we had before.’”
“Right out of the gate in 2020, homes prices in Ada County set a new record in January. One real estate agent said panicked buyers have been scrambling to buy houses when they can. ‘I have two examples of physicians who are moving here in the fall, and they were panicking,’ said Kealy Baughman, owner of Trail 27 real estate in Boise. ‘So they bought houses in December, and they’re not moving here until August.’ The median price in Canyon County for January was $256,000, up $1,000 from December but down from November’s record $264,000.”
“‘Many sellers might not realize the value they are sitting on in their home,’ says Tom Hosack, President West Penn Multi-List. Unlike 2007, Hosack says this time there is no artificial bubble in the market. ‘So if you are buying, you should feel confident that the home price is going to continue to rise and your investment is safe,’ he says.”
“Even in more affordable neighborhoods, prices are out of reach for most people. The median single family home price in the Boston area is now over $600,000, and the median condo price is not much lower. But on a recent rainy Thursday night, nearly every chair in a third floor classroom of the community center was filled for Homebuying 101, a class for low- and middle-income people who are looking to buy for the first time in the Boston area.”
“‘Because of what I do, I would hate to say no, that it’s not affordable anymore,’ said Linda Warren-Cato, who has been teaching classes like these for more than 20 years. ‘What I tell people every time I teach the class is that you just have to find a property that your income will support. And you can’t give up, because there are a whole host of ways that you can potentially find a property.’”
“Half an hour before the first session of Homebuying 101 David Glass was already in his seat in the front row. At 63, after a lifetime of renting, he is now in the process of trying to buy for the first time. He got married three years ago and his wife, he said, ‘feels more secure with a home.’ When they first started looking into getting a mortgage, though, ‘we were told we couldn’t even be helped unless we could qualify for $450,000,’ said Glass, who lives in Dorchester and currently works as a truck driver. ‘It’s terribly insane, but it’s the reality. And that’s the scary part, you know, your mortgage payments are going to be high.’”
“The heart of the housing crisis is stark and obvious. The typical Sonoma Valley family does not earn enough income to qualify for a mortgage loan on the typical Sonoma Valley home. Last year, Compass real estate agent Matt Sevenau was trying to help two teachers move to Sonoma because one set of parents lived in town. ‘We were all trying so hard to figure out how to get them a place in Sonoma,’ he said. ‘Their max budget was $600,000 and we just couldn’t find them anything that didn’t need a ton of work.’”
“From $40,000 to $1.1 million, these sellers are dropping their prices. The biggest reduction was not in Beverly Hills or Blackhawk. Do you love a bargain? All of these homes have seen large price drops. Price On Custom Beaumont Home Drops $40K In Less Than 5 Months. Price Cut! Updated Napa Home On Corner Lot Marked Down By $42K. Previously listed for over $1 million. Charming San Ramon Home Sees Price Cut By $60,000. This cul-de-sac Dougherty Hills home with curb appeal is going for $1.2 million.”
“Blackhawk Country Club home has seen its price drop a total of $100,000 since its December listing. Novato Home Comes With Captivating Views And $100K Price Cut. $118K Price Drop On Updated Mill Valley Home With Views. Hollywood Hills Home Gets Massive Price Reduction. Perched on the hilltop, it has killer views and a $130,000 price cut. Sunny Redwood City Home Sees $240K Price Drop. There’s never been a better time to buy this sunny Redwood City home — on the market for nearly $250K less than its original price. Perfect Family Home In Manhattan Beach Just Got $500K Price Drop.”
“Beverly Hills Home Just Got $955K Price Drop. This five-bedroom home sits on a large lot and is ‘priced to sell,’ according to the listing. $1.1M Price Drop, And Still No Buyer. This Fremont gated estate has a 360-degree panoramic view.”
“After years of sellers being in the driver’s seat, buyers now have the upper hand in the luxury residential sector in Dallas-Fort Worth, says Erin Mathews, real estate agent with Dallas-based brokerage Allie Beth Allman & Associates. ‘For these very high-end homes, for a while there, it was a still a seller’s market,’ she said. ‘It’s a buyer’s market for sure now.’”
“In Dallas County, there were 21 home sales in 2019 above $5 million. Nineteen were posted in MLS and two were private sales, said Mathews, who tracks luxury residential sales. Through the first month of 2020, there was one pending sale in Dallas County and 54 active listings, Mathews said. That includes new properties and resales. In Collin County, there were no public sales above $5 million last year, and there are now seven listings for sale. In Denton County there are seven listings over $5 million, one pending sale and no sales of homes at that price last year. In Tarrant County, there are eight active listings above $5 million, one pending in Fort Worth, and two sales in 2019, both of which were in Westlake.”
“Overall, the $5 million and up housing market has been stagnant for the past three years, Mathews said. ‘If you bought a house two years ago and now find yourself relocating, the expectation several years ago was that – even in a short period of time – a home might be worth considerably more than you paid,’ she said. ‘That is not the case now.’”
“Zillow Research noted that U.S. home values have fallen by more than 20 percent nationwide from a 2007 peak until a 2011 nadir. Many homeowners are currently ‘underwater’ or ‘upside-down’ on their mortgages, meaning they owe more than the home is worth. In Edwardsville, the underwater rate is 7.4 percent, versus 10.4 percent in Metro St. Louis. ‘I think a lot of that has to do with the home-equity loans that occur today,’ said Mayor Hal Patton said. ‘When you factor in your mortgage in plus your seconds on houses, they’re using those funds a lot more loosely to make improvements that may not be on the tax rolls yet or to purchase other things.’”
“New Jersey continues to lead the nation in the rate of foreclosed homes and is doing nothing about it. Foreclosed homes present major problems in neighborhoods. They bring down property values, attract vandalism and are a haven for drug transactions. Yet, legislation I sponsored three times over the years that got through both houses and to Gov. Chris Christie’s desk was vetoed three times. My response to Governor Christie was, ‘The foreclosure crisis that has plagued New Jersey isn’t getting better, it’s getting worse. We not only have the highest rate of mortgage foreclosures in the nation, this is the only state that the foreclosure rate increased during the most recent three-month period.’”
“This ongoing crisis is both a symptom and a cause of a struggling state economy. It was both a housing failure and an economic failure under Governor Christie. His indifference to the economic crisis dragged down our recovery, which in turn depressed home values and allowed vandalism and crime to spread in neighborhoods with empty homes.”