A report from the Wall Street Journal. “Actor Bruce Willis and his wife have sold their country estate near Bedford Corners, N.Y., for $7.66 million, or 41% off its original listing price. The 22-acre property came on the market in January for $12.95 million. The Willises paid about $12 million for the property in 2014.”
From Mansion Global. “Sentiment can’t get much worse for New York City’s high-end home sellers than it was in 2019—that seems to be the feeling among the city’s real estate professionals. The top of the market remains the most vulnerable to further price declines in 2020 as demand fails to keep up with a glut of new luxury condo development.”
“Even in a year when Los Angeles recorded a stunning half-dozen deals over $80 million, 2019 proved La La Land is not immune to overdevelopment and overpricing. ‘There’s been quite a lot of supply of homes that are aspirational in pricing. That has left too much inventory,’ said independent luxury broker Ben Bacal. ‘There are almost 200 homes on the market priced between $10 million to $30 million. That’s a big number; three years of inventory.’”
“It’s also created a clear opportunity for buyers in the market for a contemporary glass-encased spec home, of which there are many. ‘There’s been a lot of speculative building,’ said Stephen Kolter, CEO of Douglas Elliman’s Western Region brokerage. ‘In many cases, builders bought the dirt three years ago when pricing on the for the dirt was higher.’”
“Overbuilding in certain pockets of the Bay Area’s luxury housing market will hand savvy buyers opportunity next year. San Francisco is coming off a robust 2019, when a series of giant market-disrupting companies went public and funneled billions into the city, including high-end real estate. That infusion of wealth will likely peter out in 2020, leaving the city with more luxury condos than buyers can readily absorb, said Patrick Carlisle, San Francisco-based chief economist at Compass.”
“‘The weakest segment of the market is the ultra-luxury market,’ said Mr. Carlisle, who defined it conservatively as condos over $3 million. ‘We have this expanding inventory of gorgeous magnificent condos, and there just aren’t enough buyers.’”
“At the moment, there are some 10 to 20 condo listings for every buyer, which ‘does not create a big sense of urgency,’ he added. ‘That was unheard of two years ago.’”
“Turbulence in Miami luxury home prices, which have fallen or stagnated for most of the past three years, continues to turn off potential home buyers while an abundance of inventory leaves genuine house hunters with no sense of urgency. ‘We’ve been so overpriced over the last two, three years in so many different segments people, are confused. Especially for out-of-town buyers, there’s a question of what is it really worth?’ mainland Miami-based broker Madeleine Romanello said. ‘Buyers only want to pull the trigger on homes that are priced correctly.’”
The Bakersfield Californian. “After months of delays, a path appeared to clear Monday toward a new future for Sundale Country Club in southwest Bakersfield. At a public auction held at 10 a.m. Monday on the steps of Bakersfield City Hall, no one stepped up to bid on the financially troubled golf course, and as expected, the ownership was transferred to the purchasers of the club’s debt, a partnership that includes Bakersfield businessmen Girish Patel and Jay Patel.”
“The opening bid — which received no responses — was $1.251 million plus one dollar. ‘Ownership reverted back to the lender,’ Jay Patel said Monday. ‘We are the lender, basically.’”
The Press of Atlantic City in New Jersey. “One of the most cheerful sights this month had nothing to do with the holidays. More than 200 people gathered in Atlantic City to enthusiastically bid on 195 typically small properties being auctioned. This scene wasn’t possible for more than a decade. Interest in city real estate started plunging in 2006 with the collapse of the U.S. housing market. That set off the severe recession of 2007-2009, costing many their jobs and homes. Many more abandoned houses no longer worth anywhere near the mortgages they were paying.”
“In New Jersey, the courts halted and then slowed foreclosure processing, in part in response to reports of improper documentation by lenders. The state soon led the nation in percentage of homes in foreclosure. Atlantic City was hit hard again in 2014 by the closing of three casinos. By the next year, it had the highest foreclosure rate of any U.S. metropolitan area.”
“After the New Jersey Judiciary’s Special Committee on Residential Foreclosures recommended ways ‘to ensure a timely foreclosure process while upholding due process rights,’ the Legislature passed and Gov. Phil Murphy signed a package of nine bipartisan reforms to foreclosure processing. Among them are foreclosure mediation, getting vacant houses to a sheriff’s sale within 60 days of a foreclosure judgment, and disclosing who is responsible for maintaining properties in foreclosure.”
“The timing looks very good for the bidders at the auction of city properties this month. With no expectations of another recession at the national level and the city slowly turning around, the properties they bought — some in the $5,000 to $50,000 range — may look like incredible bargains someday.”
“It’s reassuring to see the good part of the economic cycle being used to strengthen individuals, the city and the county. The best time to counter the next inevitable downturn is during the good years after the last.”