It’s Friday desk clearing time for this blogger. “Have Northern Virginia home sellers missed the sweet spot? The D.C. region’s red-hot housing market has begun to show signs of fatigue, and in Northern Virginia the market softened in August. ‘Overall we’ve definitely seen a softening in the market which is reflected in a decrease in multiple offers and biding wars,’ said Northern Virginia Association of Realtors President-elect Reggie Copeland. ‘That has been somewhat of a challenge for sellers that didn’t make it on the market until June, July or August because in many areas buyers had started backing off and delaying purchasing based on the previously high real estate temperature.’”
“Copeland said an increase in the time it takes to get a contract from a buyer has also caused some sellers to lower their prices. The average price of what sold in Northern Virginia in August was $608,250, a 5% drop from July.”
“In the monthly meeting this week with more than 40 real estate agents and five loan officers in attendance, Mary Anne McMahon, who owns RE/MAX Posh Properties in Austin, said ‘the sentiment was that there is a very slight slowdown but the market will come right back. She said many listings continue to sell above asking price, ‘but that is starting to soften a bit.’ In a few instances, McMahon said, ‘we have had to go back to some ‘old school’ activity, actually dropping the list price if a property is not moving. In some cases, finding the pricing sweet spot can be tricky, especially in the luxury market.’”
“People looking to buy a home in the Seattle area could face possible relief as experts say the local real estate market is showing early signs of cooling down. And it’s not just price. Inventory and the number of closings are also down from July. ‘Paying a fair price and being able to have a home inspection and a lot of these other things that over the last couple of years you kind of had to roll the dice a little bit for a lot of people to be that winning bid,’ said Jon Bye with Jon Bye & Associates, who added 50% of his buyers gave up housing inspections in the last year. ‘Before, when you had 10 offers, you would have six to eight of those be fairly normal. And then you’d have two people that would really be running the price up really high, and I think that is the stuff that we might not see as much as what we’ve been used to over the last year or two,’ Bye said.”
“‘It feels like we’ve been in a non-stop sprint for much of the past year, but the market is now getting a chance to catch its breath,’ Greater Boston Association of Realtors President Dino Confalone said. ‘There’s been a bit of softening in demand over the past 8-10 weeks as some buyers have opted to take a break from the market due to affordability issues or to pursue summertime activities. Others have grown frustrated by the lack of inventory and chosen to renew leases or stay in their current home, and collectively that’s taken some of the air out of the market.’”
“A new report from the Wake County Register of Deeds Office shows that the median sale price of all real estate sold in Wake County during August 2021 was $365,000, down $19,000 or more than 5% than in July. The median sale price in the Wake County Register of Deeds data set fell from its calendar year high of $384,000, the median sale price in July 2021. And real estate agents aren’t panicking. ‘Don’t see a reason to sound the alarms about this as there will be fluctuation in the market,’ said David Jones, CEO of Coldwell Banker HPW.”
“Minneapolis agent Raashida Shelton with Keller Williams has noticed things getting easier for buyers. Instead of houses selling in two to three days, ‘now we’re seeing more inventory, and homes are sitting longer, more like 20 to 30 days,’ she said. She just closed a deal in which the seller even covered some of the costs. Imagine that — a concession from a seller! ‘What we are seeing is that more homes are hitting the market every single week. And so that’s relieving a little bit of the pressure,’ said Taylor Marr, lead economist with Redfin.”
“Bay Area homebuyers got a bit of a break last month, as prices continued to edge down in much of the region while inventory rose slightly, new data shows. The median sold price in the Bay Area was $1,265,000 in August, down 2.7% from $1,300,750 the previous month, according to a the California Association of Realtors. That followed a 3.6% decline from June to July. The biggest decline in the nine-county region was in Marin County, where the median sold price fell 10.9% to $1,560,000 from July to August. In San Mateo County, prices fell 8.8% to a median $1,925,000, and in Contra Costa the decline was 5.4% with a median price of $889,500.”
“A deceleration is widespread, according to Zillow — 43 of the 50 major metros saw appreciation slow down. San Francisco was among the cities with the largest drop-off, along with Buffalo, San Diego and Austin.”
“In one of Beverly Crest’s biggest deals so far this year, Joseph McGinty Nichol has paid $14.7 million for the iconic Bella Vista estate. The sale ends a six-year marketing journey for the 95-year-old Spanish villa. It first surfaced for sale in 2015 for $42.5 million along with seven acres of land. With no takers, the price and land size were steadily reduced; it most recently listed earlier this year for $15.5 million on one acre.”
“Facing the threat of foreclosure on her home, Carla Diamantes was shaken and frustrated.Her South Shore house is where she grew up, and has been in her family for six decades, she said. But after challenges with her mortgage servicer and upon exiting a COVID-19 program that allowed her to defer payments, she owes thousands of dollars. The servicer raised the specter of foreclosure. ‘It really shakes your core,’ Diamantes said. ‘Oh, I could be homeless. Oh, I could lose my legacy.’”
“Two- to four-flats, where tenants have faced challenges paying rent, are also at risk. Owners often live in the buildings, and foreclosure could mean the loss of both owner and tenant homes and of an affordable rental unit, said Diane Limas, a volunteer and board member fo Communities United. ‘We’re concerned for any family going through foreclosure, but our big concern is for the two- to four-flat, ma and pa homeowner that only gets money from one apartment to pay their mortgage, to pay their property taxes, to do repairs on the building,’ she said. ‘And now, all of a sudden, there’s no money coming in.’”
“Canada’s housing market continued to show signs of a slow cool-down in August. The average selling price of a home last month was $663,500. That’s down from the all-time high of $716,000 set in March 2021. Prices are down from March, on average, and so are sales volumes — down by 28 per cent from their March peak. Economist Robert Kavcic says the market has cooled from its March highs, but on the whole demand is still at historically high levels. ‘In other words, the extreme conditions that prompted much concern in policy circles have ebbed, but if not for that burst of madness, we would still be writing about record activity levels today,’ he said.”
“From home-sellers lowering property prices in Madrid to foreclosures being at their highest level in four years, and the Balearic Islands proving to be the most popular place in Spain for foreign buyers, here is the latest round-up of property news. Real estate giant Fotocasa explained that the demand for housing in the capital has decreased by 14.8 percent with respect to the previous year, so this could have something to do with the recent price drop.”
“When Chinese home-buyer Zhiwei decided to purchase a luxury apartment at a development named Australia Villas back in 1997, it was billed as the apex of affluence. Located outside China’s southern megacity Guangzhou, the sprawling complex was to have 292 buildings. Impressed, Zhiwei stumped up $21,000—a huge sum 24 years ago, when the average annual disposable income in China was less than $650. But things quickly went awry. The developer went bust in 2001 leaving most homes unfinished. Buyers with means swallowed the loss, but those without anywhere else to go, like Zhiwei, to go were forced to move into the concrete shells of their unfinished homes, living without gas, electricity and, in some cases, even windows.”
“‘The whole area is thick with weeds, you can sometimes see snakes slithering on the sidewalk, and outdoors we are savaged by swarms of mosquitoes,’ says Zhiwei, who asked to use a pseudonym for fear of jeopardizing ongoing negotiations with the developer and local government. ‘As the houses are unfinished, we can’t even get [approval] to sell them.’”
“Two decades on, many people still live amid the vine-entangled, mildewed structures, planting vegetable gardens and rearing chickens on what were supposed to be ornamental lawns. More than 2,000 homeowners like Zhiwei are still waiting compensation. ‘After fighting for our rights for more than 20 years, many owners are getting old, and even the youngest have been retired for several years,’ she says.”
“Wu Lei says his small construction company in central China has accepted commercial paper from property developer Evergrande as payment for two years but with that paper’s value now in doubt, his firm is on the verge of collapse. ‘We were working for Evergrande, so our suppliers trusted us with the materials without us paying upfront. Now they’re suing me, courts have frozen my property and I’ve sold my car. And I still have employees who need to be paid,’ he said.”
“The plight of Wu and many others like him has thrown a spotlight on the extensive use of commercial paper in China’s property sector. Developers favour it as they prefer to not pay upfront and because it doesn’t count as interest-bearing debt. The paper promises contractors and suppliers payment on a future fixed date, usually within one year.”
“An owner of a small marketing and consultancy business from one of the poorest counties in Guizhou province said he had accepted Evergrande commercial paper from a client and was waiting on 1.5 million yuan in payment that was now two months overdue. ‘I feel depressed, and sorry for my family, having to accompany me in a life in debt,’ he said. He declined to give his name, citing rumours of physical threats being made against protesters.”
“In a jaw-dropping moment caught on camera, 15 high-rise buildings were obliterated simultaneously in China after sitting unfinished for eight years. In the country’s Kunming, the capital of Yunnan province, the skyscrapers were destroyed into huge pile of dust. Now, video of the demolition is going viral, leaving netizens stunned while starting a serious conversation about country’s excessive and unplanned urbanisation projects.”
“Authorities decided to take such drastic step as the buildings had been abandoned for a very long time and the basements were submerged in rainwater. Taiwan News added that these buildings were part of the unfinished Liyang Star City Phase II project and was about 1 billion Chinese yuan (US$154 million) worth of property. However, this is not the first time simultaneous demolitions at such a large scale was seen in China. Earlier in 2017, 36 buildings were flattened in a mere 20 seconds in Zhengzhou, with a plan to renovate the area into a more appealing hub.”
“Here’s how netizens reacted to the demolition: ‘It’s wacky enough that China’s central planning has to get rid of millions of unneeded housing units, but what really astonishes me is: look how these buildings are toppling over sideways. That’s NOT supposed to happen in a controlled demolition. These buildings were death traps.’ ‘Your reminder that China ridiculous growth over the last decade has been primarily fueled by gov’t back ‘building.’ Evidence continue to shows demand has evaporated with too many residential property up to quickly resulting in demolition.’”
“‘This is a potential 1Bn Yuan of residential RE that is wiped off the face of the earth in China. This could’ve made property values just a bit more affordable had they finished these units. But let us remember this is a feature of fiat not a bug. Not wise to dilute nominal wealth.’”