A report from Boston.com in Massachusetts. “The housing market in suburban Boston is ‘crazy.’ That’s the description Laura Semple and Beth Hettrich, agents in Sudbury, gave. ‘We listed one house at $1.1 million based on comparable sales that had 12 offers and sold for $1.26 million in one day,’ Semple said. ‘That house was valued at $975,000 just two years ago.’”
“‘I’m a little concerned about the sudden escalation of prices, but I think we have a long way to go before we’re in the danger zone,’ said Tim Warren, CEO of the Warren Group. ‘When the bubble burst in 2006, we had seen six straight years of price appreciation at 10 percent or more. Now we’re only a year or so into that kind of appreciation.’”
“‘There’s a different dynamic now with pent-up demand and not enough housing rather than a mentality of buying while the market is hot,’ said Helen Tarantino, a realtor in Boston. ‘When the bubble burst before there were too many houses being built. We’re not in any danger of oversupply now.’”
From CBS Boston in Massachusetts. “For the first time in a long time, it’s good to be a renter in Boston and surrounding cities. CEO of Boston Pads Demetrios Salpoglou said, ‘In theory for certain apartments you could put down as little as moving in with one month’s rent to get in and that’s historically unheard of in Boston. Any place you had a high student population or a high concentration of corporate relocation, short term rentals, Airbnbs, a lot of that was decimated.’”
“Gabriel Bonilla is an agent with Douglas Paul Real Estate in Cambridge. One of his clients is Haley Euting, who recently signed a lease for an apartment in the South End. ‘I had no broker’s fee and no security deposit due,’ she said. Another one of Bonilla’s clients, Andrea Salazar, recently found a place in Somerville. Salazar has a dog and wanted a parking spot, so initially she wasn’t sure what the inventory would be like.”
“‘The rent was much lower than I think it would’ve been normally and I think definitely on the pet issue the landlords were more willing to play ball with that,’ she told WBZ. According to Zumper, the average rent price for a one bedroom in Boston is down 16-percent compared to last year.”
From Mansion Global. “Few experts at this point deny that smaller U.S. markets are experiencing severe imbalances, due to high demand and disappearing inventory. But the disparity doesn’t seem to portend a potential crash, so much as an ongoing squeeze for local buyers. Unlike periods of rapid price acceleration in the past, buyers this time around don’t seem to be stretching beyond their means in order to purchase.”
“As for the wealthy out-of-town buyers, don’t expect most to rush to sell properties once they head back to the office. ‘The amount of second-home owners [based] in San Francisco has skyrocketed,’ said Vanessa Gamp of Corcoran Global Living. ‘We’re a city where there is just money here. And that’s not the kind of person that needs to liquidate.’”
The Jewish Voice on New York. “Jocelyn Wildenstein, a socialite known for her looks following extensive plastic surgery, had her residence sold by creditors. As reported by the NY Post, one of three condo units she owned at the Trump World Tower in Midtown Manhattan has been sold. An administrator appointed by her creditors sold the single unit on the 51st floor of the Midtown East tower for $2 million. Wildenstein, formerly a big spender, had owned three units at the luxury tower and combined the units.”
“Swiss-born Wildenstein, 80, had been married to the late billionaire and art dealer Alec Wildenstein. The couple had a messy divorce in 1999, and she was reportedly awarded a whopping $2.5 billion in the divorce settlement. Somehow, she made it from billionaire to bankrupt.”
The New York Post on California. “Even for billionaires, $35 million is a pretty steep discount. The Hearst estate is scheduled to be re-listed today for $89.75 million, more than half off its $195 million asking price in 2016. Only last month, it was listed at $119 million — about $30 million more than its current asking price. ‘This property now has a motivated seller and is priced to sell,’ listing broker Anthony Marguleas told The Post.”
“The 1926 pink stucco mega-mansion also called the Beverly House has been in bankruptcy since 2019 and has been on and off the market since 2007 as the owner, litigator Leonard Ross, tried to stave off a forced sale, even turning to crowdfunding. He purchased the house for $2 million in 1976, but he now owes an estimated $65 million against the property, the Real Deal reported.”
The Los Angeles Times in California. “In interviews with The Times, property owners and managers said they understood the unprecedented nature of the crisis but that they are absorbing too much of the cost. Many said they or their clients are dipping into savings to keep properties afloat and delaying maintenance or repairs because they can’t afford them. Some said they probably can’t or won’t hold on much longer under these circumstances.”
“‘I am hoping something will turn around [so] I don’t have to sell,’ said Beverly Rowe, who manages her family’s Los Angeles triplex, an asset she is proud to have secured to ensure her parents’ financial security in old age and to pass down wealth. That asset, hard-earned for many Black households like hers, is now at risk. Rowe said a tenant owes $30,000 in rent payments missed over the last year.”
“One property owner in her 60s said she is considering taking a second job to avoid having to sell her two 20-unit buildings because she’s having difficulty keeping up with mortgage payments. An owner in his 80s said he’s already told his lender he can no longer meet payments and anticipates handing the 200 units he owns back to the bank. A new survey offers more specific insight into the pandemic’s effect on landlords in Los Angeles: More than half of 1,300 property owners surveyed in December last year said their business would face financial distress within six months if their situations didn’t improve.”
“Before March 2020, 4% of owners with more than 30 units reported problems with paying the mortgage, compared with 7.3% of owners with six to 30 units and 10% of owners with five or fewer units. Irma Vargas, the chief financial officer at property management firm RST & Associates, said two of her clients who own a few units each had to sell their respective properties recently because they couldn’t afford to keep them. ‘The little small mom-and-pops are getting burned on this one,’ she said.”
“For some, losing business properties risks a backslide from the economic mobility that getting into the housing market once promised — a particularly painful development for Black Americans whom the government once barred from access to homeownership. ‘We are going to have to sell,’ Rowe said. ‘That means we cannot pass this property down…. There will be no generational wealth to continue in our family.’”
“After moving in with her 85-year-old mother to help care for her, Rowe worried about bringing COVID-19 home and stopped working her usual job as a physician assistant. She said she has burned through savings to cover the mortgage and repairs at the Mid-City triplex after the tenant stopped paying rent there. With cash tight and no income from the property, Rowe said she is scrambling to pay for the supportive care her mother needs after a heart attack. Offloading the triplex looks increasingly necessary. ‘It’s devastating,’ she said.”
“Even some landlords with less immediate financial pressures are taking a hit. Jef Vander Borght, 69, owns two fourplexes in Burbank and Glendale with his wife that they bought roughly 20 years ago to help them through retirement. Vander Borght said his tenants had fallen more than $12,000 behind in rent since last spring. He understands they have lost work and can’t pay in full, and doesn’t want to evict them.”
“He criticized governments as failing to adequately help struggling residents and in turn landlords like himself, citing a tenant of his who got help from a county program for the first time last month. The local aid reduced the debt he is owed to around $7,000. ‘I never, ever imagined we would be in a position just to be told to house people for free and ‘good luck getting help — help will eventually appear,’ he said.”
“David Haas, managing broker with Ernst and Haas Management Co., said he has clients selling preemptively. The Long Beach firm specializes in managing one- to four-unit properties for mom-and-pop owners. They are ‘liquidating because of the fear of the laws that are protecting only tenants,’ Haas said, ‘fear that their tenant could go into default and they won’t be able to do anything.’”