A report from the Phoenix Business Journal in Arizona. “As the Valley’s housing market continues to cool, home sellers are cutting list prices while various incentives are emerging — signs that the housing market is finally on its way to becoming more balanced. The percentage of homes on the market that needed price reductions before they sold climbed 23% in metro Phoenix last week, said Greg Hague, CEO of Scottsdale-based 72Sold. Nationally, that percentage of homes climbed to 27.2%. ‘When it reaches 30%, that is a sign that we are in a balanced market, with buyers and sellers having equal negotiating strength,’ he said. ‘I predict that will happen in August.’”
“Another big sign of the market coming back into balance is looking at the contract ratio, which is the number of homes sold and waiting to close compared with the number of homes listed for sale at any given point. It is measured per 100 homes for sale. In mid-April the contract ratio was 250, which means for every 100 homes for sale, there were 250 homes sold waiting to close. ‘As of last week, it had dropped to an astounding low 62,’ Hague said. ‘In other words, for every 62 homes sold waiting to close, there were 100 homes for sale. Predictions are it will drop into the mid 50s this week.’”
The Las Vegas Business Press in Nevada. “It didn’t take long after the latest mortgage interest rate hike for every real estate guru and pundit across the nation to put their Chicken Little hat on and begin forecasting the onslaught of a gloomy real estate market. We can pick up almost any newspaper and read about sellers slashing prices as if to infer panic selling and rapidly declining market prices.”
“We are not really seeing anything like this in Las Vegas or Southern California. Yes, there was a modest uptick in the number of price reductions in Las Vegas this month, but this market has supported massive overpricing for several years. The average amount of overpricing for a single-family residential listing remains around $65,000 for properties listed below $1 million. Thus a $20,000 or $30,000 price reduction may still be above market value for at least 25 percent of those properties.”
The Colorado Sun. “On June 27, the average list price for a house for sale in Denver was $742,773. Three days later it dropped 2.9% to $721,517, according to Opendoor. Meanwhile, during the same three days, the median closing price fell $26,000, or 4%, to $619,000. Zillow data for the Colorado Springs, Denver and Fort Collins markets do show that there’s been a sharp increase in the number of houses that cut the list price within the past month. The chart below shows that in early June, 9.17% of the homes for sale in Denver dropped their price in the past month, while 9.1% did in Colorado Springs and 3.37% did in Fort Collins.”
“Those price discounts in Denver rose to a median of $19,000 in early June, nearly double the amount in January. Colorado Springs price cuts weren’t as sharp and had dropped to $11,050 in early June, while Fort Collins hit $19,201.”
The Santa Fe New Mexican. “The real estate world is hinting boom times are ending and home prices could be softening. But that’s what the experts thought at the beginning of the pandemic, and look what happened. No matter how you view it, conventional wisdom meets its match in Santa Fe and Santa Fe County, where home sales dropped in the second quarter of 2022 to their lowest level since 2011 — but the median home price for the same time period rose to (take a deep breath) $789,385.”
“The second quarter report could already be ancient history. ‘My observation now is buyers are slowing down their purchasing process,’ said David Barker, qualifying broker and owner of Barker Realty. . ‘There is a little nervousness. We’re seeing properties now coming on the market that six months ago or a year ago were selling very quickly. They are not selling as quickly now. There are still portions of the market, if your property is the right price, you will get multiple offers and strong sales — but that portion of the market is decreasing rapidly.’”
From CNBC on New York. “Sales contracts for Manhattan apartments plunged by nearly a third in June as the city’s scorching real-estate market started to cool amid recession fears and declining stocks. ‘Throughout the second quarter, that slowdown has accelerated: fewer signed contracts, fewer bidding wars, more price reductions, and a gradual increase in available inventory,’ Coldwell Banker President Frederick Warburg Peters wrote. ‘The gradually slowing sales market manifests in all boroughs and at all price points throughout the city.’”
“‘This is a market in transition,’ said Bess Freedman, CEO of Brown Harris Stevens. ‘Buyers are in the driver’s seat right now. There is just a lot of uncertainty and weaker confidence.’”
From Candy’s Dirt in Texas. “It does appear that in the past 30 days many areas are seeing a few less outrageous over-asking price offers. Realtor Greg Potts of Compass in Fort Worth recently informed CandysDirt.com that he has had an uptick in making offers and receiving offers on his listings. ‘There are definitely a lot more options for buyers,’ Potts said. ‘I have been involved in more negotiations over the past two weeks than in the past two years.’”
From USA Today on Mississippi. “A typical Hinds County home listed for $144,500 in June, down 3.3% from the previous month’s $149,500. The median list home price in June was down about 18.8% from June 2021. Rankin County’s home prices fell 5.8%, to a median $357,950, from a month earlier. Madison County’s home prices fell 12.4%, to a median $547,500, from a month earlier.”
From Bisnow San Francisco on California. “A Transwestern report on the performance of San Francisco’s office market in the second quarter paints a sobering picture more than two years into the remote work experiment that the city’s all-important tech companies have embraced. Negative net absorption in particular is troubling, dropping to 762K SF in the second quarter of 2022. That is a 118.4% increase from the 350K SF of negative net absorption recorded in the same period in 2021.”
“George Entis, senior research manager for Transwestern, speculated that the flight-to-quality trend for office space will continue to push demand for any space below Class-A into nonexistence. ‘Class-C is becoming useless,’ he said.”
The Canadian Press. “Last month’s Greater Vancouver area home sales dropped by about 35 per cent since last June and 16 per cent from May 2022. Such behaviour indicates the market is shifting in favour of buyers, said Tirajeh Mazaheri, a Coldwell Banker Prestige Realty agent in Vancouver. Gone are the days when properties would be sold in days — or sometimes hours — and garner multiple offers. ‘Now, they’re sitting on the market for a few weeks to a few months and people are not touching it,’ Mazaheri said. ‘It’s a very big, drastic change.’”
The Vancouver Sun. “Median prices have been dropping consistently and considerably since the Bank of Canada started hiking interest rates earlier this year, said Hao Li, a Vancouver-based broker with HouseSigma. In February, the median price for all housing types in all of Metro Vancouver was $1.028 million, but fell by 13.5 per cent to $889,000 in June, according to HouseSigma analysis.In some areas, the change in median prices was greater, falling by 28 per cent in Delta (to $1.165 million from $1.625 million), by 23 per cent in Surrey (to $843,000 from $1.1 million), and by 23 per cent in Maple Ridge (to $960,000 from $1.25 million), according to HouseSigma.”
“‘This is a very real shift in the market,’ said One Flat Fee agent Mayur Arora who has clients in Metro Vancouver and the Fraser Valley.”
From Bloomberg. “London’s property market is in flux with house prices continuing to rise and apartments declining in value. Apartments are down more than 11% from their peak in August 2020, with the median sale now less than 400,000 pounds, according to an analysis of UK Land Registry data for April by Bloomberg News.”
Daily Mail Australia. “The derelict inner city terrace that was the subject of a row over squatter’s rights has been sold for a big loss after the owner abandoned renovation plans. The ‘unliveable’ two-bedroom house, at 544 Elizabeth Street, Redfern, sold for $1.025million on Saturday, $85,000 less than the vendor bought it for in 2017.”
The Australian Financial Review. “In what should come as no surprise to regular readers of this column, Australian house prices declined for the second month in a row in June – and the pace of losses is accelerating sharply. There is also clear evidence that what is destined to become the largest draw-down in Aussie housing market history is gradually extending to Brisbane, where home values look to be rolling over, and Perth, where prices are moving sideways again.”
“Pity the poor home buyers who went out and borrowed vast sums based on the RBA’s guidance that they would not lift interest rates until 2024 at the earliest.”
The Times of India. “It is rightly said that history repeats itself. This time, glimpses of it can be witnessed in China, where the deep recession in the property market has compelled real estate companies to float a bizarre marketing strategy to lure home buyers. As per reports, they are following the ‘Barter system of exchange’, in which participants in a transaction directly exchange goods or services for other goods or services without using a medium of exchange, such as money.”
“In China, real estate developers have started accepting payments for homes in watermelons and other agricultural produce. As per Global Times, a developer said that it would allow home buyers to pay for their homes using watermelon at a rate of 20 yuan per kilogram. A poster for the promotional event starting from June 28 to July 15, reads the property developer would allow home buyers to make a maximum payment of 5,000 kilograms of watermelon, valued at 100,000 yuan, noting the purpose of the promotion is to support local watermelon farmers.”
“Well, as per experts, the situation is alarming and as per New York Times, the housing market in China is now seen as ‘a national threat’.”