A report from Boca News Now in Florida. “Home values in Boca Raton and Delray Beach dropped precipitously between from the second to third quarter of 2021. According to the Elliman Report prepared by Miller Samuel Real Estate Appraisers, the average price of a single family home in Boca Raton dropped 16.9 percent from the second quarter to the third quarter. The average sales price from April through June was $1,284,350. But that dropped in the July through September time frame to $1,067,735. By square foot, pricing dropped from $327 per square foot to $304.”
“The average sales price for ‘luxury’ homes in Boca Raton also dropped quite a bit. Defined as homes in the top ten percent of for sales, the average selling price dropped from $2,146,250 during the second quarter to $1,572,500 in the third quarter.”
From Community Impact in Texas. “Home prices in Community Impact Newspaper’s Central Austin coverage area continued to cool off for a second month, according to the Austin Board of Realtors. The median home price for the area was $662,000 in September, down from $672,000 the previous month. Leading up to August, home prices had increased each month of 2021 in the heart of Austin, peaking at $725,000 in July. ‘More homes are beginning to hit the market, evidenced by the increase in new listings in September, which is creating a greater number of opportunities for buyers. While this is a positive step forward, there is a long way to go for this to be a balanced market,’ ABoR President Susan Horton said.”
The Real Deal on California. “‘I hear from landlords all the time that they have been left holding the bag,’ said Dan Yukelson, executive director of the Apartment Association of Greater Los Angeles. ‘Now that we’re rounding the corner on a year and a half of [the pandemic], they’ve got to do something to get the money out faster.’”
The New York Post. “An iconic oceanfront Montauk home owned by legendary TV host Dick Cavett has sold for $23.6 million — far less than its original $62 million asking price in 2017.”
From The Advocate in Louisianan. “Local real estate specialists aren’t totally convinced that the sizzling New Orleans market is suddenly about to turn cold. Missy Whittington, CEO of NOMAR, said it was more likely that rising prices would slow down rather than stall. ‘I don’t think weakness is the right word for what we’ll see; I think it’s going to be more a shift in gears,’ she said.”
“The number of homes for sale had started to rise over the summer. NOMAR’s September housing-market report said that there is likely more inventory coming onto the market, which could mean competition for homes may soften. That ‘could even bring a moderation in sales prices, which, after 114 months of year-over-year gains, would be music to the ears of homebuyers.’”
From DS News. “About 1.4 million homeowners are still in forbearance and all eyes are examining the possible risks. In the midst of this, Ginnie Mae’s evolving pooling rules for RPLs have spurred a run on the lucrative early buyout (EBO) market with benefits that include mitigating ongoing P&I losses and balancing DQP ratios. Holders, however, need an airtight servicing strategy to cure these loans.”
“Dave Vida, a mortgage industry veteran and EVP of Business Development at Computershare Loan Services (CLS), states, ‘EBO buyers need to ensure they are adequately staffed to manage non-performing loans and are prepared for changing market conditions. This includes having the proper level of expertise to manage a surge in loss mitigation.’”
From Mortgage Professional America. “Canada’s appetite for mortgages and other forms of debt has reached the point of aggravating the financial vulnerabilities of an already overstressed economy, according to researcher David Rosenberg and economist Julia Wendling. ‘Despite being among the most indebted of their peers pre-pandemic, Canadian households expanded their liabilities at the fastest rate in nearly a decade – primarily driven by a huge uptick in demand for mortgages as low interest rates prompted a surge in house prices,’ Rosenberg and Wendling said in their recent contribution to the Financial Post.”
“The unrestrained borrowing pushed the Canadian household debt-to-GDP ratio from 101.3% at the end of 2019 to 119.6% by mid-2020. This trend is likely to negate any gains from the (temporarily) improved purchasing power that borrowers enjoy, the analysts said.”
“‘With mortgage debt accounting for more than two-thirds of liabilities and real estate as a share of disposable income reaching a record high of 501%, Canadians are exceptionally vulnerable to any correction in the housing market, which has already shown signs of cooling off,’ Rosenberg and Wendling said. ‘All in, the long-term fundamentals of the Canadian economy are on shaky footing, further crippled by excessive debt, and we fully expect future economic growth to remain subdued.’”
From Globes on Israel. “The list of those harmed by Eldad Peri (44), the real estate developer hot dead in the street outside his synagogue in Rehovot on Friday morning, is a long one. Peri is suspected of having spun a web of illusions over the years, and apparently ran a Ponzi scheme with the money he received from members of buyer groups, needing a constant inflow of new money to finance previous activity, without which the business goes into freefall, as happened to Peri.”
“Eldad Peri left behind him debts of hundreds of millions of shekels and a series of lawsuits over money that disappeared, payments that never reached trustee accounts, multiple caveats in Tabu (the Land Registry), loans upon loans that were never repaid, and failure to provide collateral to buyers.”
“During the good times, Peri’s ostentation included luxury offices in the Azrieli Towers in Tel Aviv, massive advertising, investment in football clubs, huge salaries for well-known managers, appearances at business conferences, and so on, all in order to project an image of a businessperson in the big league.”
“It was found that it was very difficult to separate between Peri himself and his companies, and that Peri was designated the borrower in loan agreements amounting to at least NIS 280 million. ‘To advance projects by the companies, loans were taken amounting to substantial sums by the Peri group from non-bank lenders, and as part of the collateral given to secure these loans, besides mortgages on the plots of land that were the subjects of the loans, the debtor mortgaged his private assets,’ Haver’s report states.”
From AFP. “Chinese property giant Evergrande’s shares plunged today after resuming trading in Hong Kong, with the failure of a unit sale deal deepening fears the indebted firm will collapse and send shockwaves through the world’s second-largest economy. Evergrande said it would continue to implement measures to ease its liquidity issues, cautioning that ‘there is no guarantee that the group will be able to meet its financial obligations.’”
“‘I don’t think it will be a surprise to see a default (on the offshore note),’ said Chen Long, partner at research firm Plenum. ‘Actually, it’s the other way around. It would be a surprise to see Evergrande not default.’ Chen said Evergrande did not start the contagion, noting that many developers had borrowed too much money and found themselves in trouble with tighter restrictions and a cooling housing market. ‘Evergrande was not the first, and it’s not going to be the last,’ he told AFP. ‘It just turned out to be the largest.’”