A report from WPTV. “The rising cost of home insurance for one Palm Beach County condo is a story that seems to playing out at condos all across Florida. ‘It’s shocking to watch in a few years to go from under $100,000 to pushing a half a million,’ Christina Auer said. That fast increase in just a couple of years trickles down to the condo residents, who pay for it in their monthly fees. ‘Everyone is selling,’ Auer said about her neighbors struggling with the insurance costs. ‘The cost is so great the condos aren’t selling as quick as they were.’”
The Real Deal. “Redzone founder Mark Sutcliffe flipped a Fisher Island condo at a loss after paying a record $21 million for it a year ago. Records show Sutcliffe and his wife sold unit 7954 at 7954 Fisher Island Drive for $19.3 million, $1.7 million less than they paid in March of last year. The Sutcliffes listed the condo for $23 million in February and dropped the price to $22 million in March, Redfin shows. Fisher Island is a popular enclave among South Florida luxury buyers.”
From WPDE. “South Carolina has one of the highest foreclosure rates in the nation, according to Attom Their research shows Columbia, Spartanburg and Florence counties have the highest number of foreclosures state-wide. Black Sloan is a real estate expert who said in addition to an increase in insurance rates and property taxes, the economy is a huge reason why the upstate is experiencing an uptick in foreclosures. ‘I will say though some of the challenges people have had, that we have seen in other parts of the state and even here, has been a massive increase in both insurance and property taxes, which has really increased peoples’ monthly payment significantly,’ Sloan said. ‘I’m not worried at all for our area right now. Again, anything can happen with the economy. I think people who are struggling, living paycheck to paycheck, everything’s more expensive. Some people if they had a very low interest rate, that can put them in a tough situation.’”
Lamorinda Weekly. “Lafayette Council at the meeting April 8 received a staff report from City Manager Niroop Srivatsa about State Farm’s plans to stop renewing or cancel home and apartment insurance polices in California beginning July. The move is projected to impact 72,000 insurance policies statewide. In Lamorinda, the non-renewals range from the lowest at 11.6 % for Moraga, to Lafayette’s 30.4%, with the highest in Orinda, at 54.7%. Council member Susan Candell said she had experienced a State Farm cancellation. After reaching out to an independent fire insurance broker, she was told she was only eligible for the State FAIR plan – a far cry from the near dozen carriers the agent used to be able to suggest. She said not being able to obtain fire insurance ‘is frightening’ and the data used by approval registries for risk projection is dated. ‘If they don’t address this this cycle, next year we [will] have a calamity.’”
From Newsweek. “A video showing several abandoned homes in a ‘zombie’ neighborhood in Austin, Texas, has gone viral online as the former pandemic boomtown is experiencing an exodus of residents. ‘Austin developers are giving up on neighborhoods,’ Austin realtor Jeremy Knight said in the video published on Tuesday. ‘Look at this: we are in a neighborhood in south Austin, and it’s completely abandoned right now. This neighborhood was supposed to have like 200 homes in it and look, it is sitting vacant and barren. These homes are falling apart,’ he continued. ‘It’s the entire neighborhood.’ Footage shot around the neighborhood by Knight shows empty and unfinished properties with broken windows and rotting wood in their foundations. Knight said he did not yet wish to disclose any further information about where the Austin neighborhood in his video was located. ‘Realtors did not abandon that neighborhood. The developer has run into problems with funding,’ he told Newsweek.”
The Indianapolis Star. “What happened to all the money entrepreneur Rodney Grubbs borrowed from his creditors, including dozens of friends and associates he met in the fast-growing world of pickleball? That was the $47 million question at a hearing Tuesday in Grubbs’ bankruptcy case. And the answer remained a mystery at the conclusion of a virtual meeting of creditors. During the meeting conducted online via Zoom, Grubbs faced more than 100 people, many claiming he owes them thousands of dollars for unpaid personal loans and interest. The occasion was the first official meeting of creditors held in the search to track down Grubbs’ assets as part of the bankruptcy case. Motions have been filed with the court to hire realtors to sell Grubbs’ rental homes in Ohio and Kentucky. ‘I know what question is on most peoples’ minds — especially mine,’ said Joanne Friedmeyer, the bankruptcy trustee. ‘We see there’s some inventory and all, but where’s the money? Where did it go?’”
Investigative Journalism Foundation on Canada. “Since Bulvant Singh Pertab Singh sold his pizza restaurant in B.C.’s Fraser Valley last year, he’s spent his retirement going for long walks, working out at the gym and generally enjoying life. But he worries he’ll soon have to find a new job to pay the bills. More than three years ago, Singh invested a significant chunk of his savings into a real estate development promoted by Evest Funds, now operating as the Cynterra Group. But ground has yet to be broken, and Singh has not seen any of the advertised returns. ‘This has made my life miserable,’ Singh said. ‘I’m at the age of 69 now, and the project, it’s not even moving forward. I need money.’”
“Based in Vancouver, Cynterra holds regular seminars to pitch its real estate projects to investors, and advertises regularly on Facebook, running ads that entice users to ‘boost your TFSA and RRSP earnings,’ with ‘15% annualized return on investment.’ According to two claims filed in Chilliwack small claims court, Singh invested $53,000 in January 2021 into a Kelowna townhome development project promoted by Cynterra. The project has not yet received final approval from the city. ‘I verily believe they have misused my investments for purposes other than that for the property trust that I have invested in,’ Singh wrote in his claims, asking for a court order awarding him more than $70,000. None of his allegations have been tested in court.”
“Since 2018, the websites for Evest and Cynterra have invited investors to help fund at least three real estate developments in the Okanagan, four in the Victoria suburb of Langford and one in Mexico. But to date, construction has begun on just one of those projects, which is now partially completed, and two are in foreclosure.”
Blog TO in Canada. “An Ontario home sold well below its previous selling price earlier this month sheds light on just how unpredictable the province’s real estate market tends to be. Located along the Lake Ontario waterfront in Hamilton’s Stoney Creek community, this four-bedroom, four-bathroom home originally sold for a staggering $2.325 million in April 2022. Less than a year after it was sold, the home was put back on the market for $2.498 million, but was terminated shortly after. In May 2023, the home was re-listed for just shy of $2 million, and was taken back off the market less than a month later.”
“In June 2023, the home slashed roughly $50,000 of its previous listing price and was put back on the market for just under $1.95 million, but failed to sell once again. The home was re-listed for just shy of $1.9 million in September, but failed to attract any buyers. The luxury property was re-listed for a final time in March 2024 at $1,899,900, and managed to finally sell just below its listing price at $1.83 million.”
This Is Money in the UK. “The number of homes for sale is at a five year high, according to Zoopla, raising questions over whether house prices could fall further. The property portal revealed there are 20 per cent more homes on the market than there were this time a year ago. Zoopla said it marked a ‘huge increase’ in supply, and was double what was available at the same time in 2022. Izabella Lubowicka, senior property researcher at Zoopla added: ‘Sellers putting their homes on the market need to keep that in mind and ensure they are pricing their property realistically in order to achieve a sale.’ Peter Stimson, head of product at the mortgage lender MPowered, believes current mortgage rates could drag house prices lower. ‘January’s jump in house prices now seems as forgotten as most people’s New Year’s Resolutions,’ said Stimson.”
The Wall Street Journal. “The cheerleaders were operating on a seemingly bulletproof assumption that China’s government would never allow the market to crash. Chinese people had invested the majority of their wealth in housing. Letting the market tumble could wipe out much of the population’s savings—and erode confidence in the Communist Party. Now China is paying the price for failing to act earlier to rein it all in. One popular tactic, which bankers and investors nicknamed ‘hole-digging,’ involved using shell subsidiaries to borrow money, guaranteed by the parent development companies. The structure enabled the parent companies to avoid disclosing on their own balance sheets the liabilities incurred by guaranteeing the subsidiary’ debt. It wasn’t illegal, lawyers and accountants said, because a balance sheet is supposed to provide only a snapshot of a company’s financial health at a specific point in time.”
“Developers sometimes pledged the same collateral multiple times when borrowing money, according to developers and bankers familiar with the activity. Chinese banks were so eager to underwrite such offerings that they sometimes agreed to invest tens of millions of dollars of their own money in the bonds, no matter the pricing, according to bankers and an executive at one development company. Such bank participation would suggest to other investors that the deal was hot, thereby holding down the interest rate and making it less expensive for developers to raise money. ‘At that time, we chose investors, not the other way around,’ the executive said.”
“One executive at a Chinese rating agency said Evergrande asked him to award the company a sovereign credit rating, which would signal Evergrande was as safe as the Chinese government. Three large Chinese domestic companies awarded it triple-A ratings, the highest possible. S&P Global gave Evergrande only a B-plus rating, junk-bond territory. Chinese state media highlighted the discrepancy, with People’s Daily writing that it was partly due to ‘a lack of understanding of [Chinese] companies.’ People’s Daily blamed Western firms for ‘exaggerating the potential risks of the Chinese economy and companies,’ and said international firms could be helping short sellers.”
“Chen Yanzhi, now 35, says she began buying homes while still in college, after making a bit of money trading stocks. She started visiting new projects around the country, snapping up units whenever she saw one she liked. Over a decade, she bought and sold more than 20 homes in places such as Nanjing, Shanghai and Hainan province. The first cost around $70,000. Years later, she paid $3.8 million for a property in Shanghai. ‘I love houses, and I love everything about houses,’ Chen said in an interview. Chen said half of her homes are now without tenants, and several are worth less than what she paid. She said she isn’t in a hurry to sell, though, and remains optimistic.”