A report from Floor Daily. “With Millennials being young, the price point of the home is not typically up the food chain, generally in the $250,000 to $400,000 price range, depending on the market and region. The impact, says Andy Hogan, CEO of FEI Group, the nation’s largest network of interior and exterior finish contractors, is that in an effort to churn out homes, a lot of which are spec homes, upgrades are limited. Hogan adds, ‘There’s very little upgrade ability and full flooring selections. Typically, you’ll have standard and then maybe a first- and second-level upgrade and that’s about it if they’re spec homes. So, it’s limiting profitability. The majority of homes that are being built are spec homes, whereas, seven or eight years ago, it was reversed and the majority of homes that were built were not spec and the upgrades back then were maximized.’”
The Idaho Statesman. “Idaho’s largest home builder will take a $600,000 loss for backing out of a deal to buy 282 acres of state-owned land near Caldwell. Back in June, Corey Barton offered $35.2 million — nearly six times the $6 million appraised value for two parcels of farmland. Barton forfeited $500,000 put up as earnest money and an additional $100,000 for extensions that gave him more time to pay, Sharla Arledge, a spokesperson for the Idaho Department of Lands, said by phone.”
“After Barton withdrew, Toll Brothers was offered the property but declined to buy it, she said. So the land will be offered at another auction later this year.”
From KSL on Utah. “The Beehive State’s housing market is catching its breath, according to the Utah Association of Realtors. ‘The big story from the August report is we’ve got sales that have slowed a bit from earlier this year,’ said Deanna Devey, the association’s director of communications. ‘The biggest difference you find is that, instead of getting 30 offers on a home, it might take you a couple weeks, instead of one weekend, to get an offer,’ said Dave Robison, who was the 2020 president of the Utah Association of Realtors. ‘You might still end up with a couple offers.’”
“‘Between now and December, we’re actually going to see the builders put a lot of inventory on the market,’ Robison said. The reason, Robison said, is that many builders switched to spec homes earlier this year because of the rapidly rising prices, and now, those homes are nearing completion. ‘I think that we’ll see more inventory coming on to the market and that’s great news for buyers,’ Devey said. ‘We’ve had some awesome homebuilding that’s happened this year.’”
From Fox 13 Tampa Bay in Florida. “It’s an excellent time to buy a home because buyers who are frustrated with no inventory, there’s a lot more inventory on the market now than the summer, when the houses were selling almost instantaneously, said Realtor Vince Arcuri. His advice, for buyers who may be burned out from the hot market? ‘I’d say don’t give up,’ he said. ‘We’ve had people who have tried to buy 12 to 13 houses and now there seems to be much more of a selection with inventory on the rise.’”
From WTBW in South Carolina. “Real estate experts along the Grand Strand have recently been tracking a shift in the booming housing market. Sloan Realty Group said it’s starting to see a change in trends after August numbers have come in. The realty group has tracked two straight months of decline in single family home sales and three months of decline in condo sales. That’s as inventory for single families has been rising over the last two months, according to Sloan.”
“Sloan Realty said prices haven’t been impacted yet, but it’s keeping a close eye on the trend. This means it could be time to sell if you’ve been waiting for the market to peak. Buyers may soon find a more favorable market. ‘A lot of buyers have been waiting in the wings for prices to correct or the market to soften a bit, or maybe even just the competition to go down,’ Director of Sales for Sloan Realty Group Alex Prout said. ‘So you’re not competing with so many multiple offers.’”
“Prout said the changing season and interest rates could be factors behind the shift. ‘We’re looking at a sharp up spike as far as interest rates go for lending, which is going to deplete the buyer pool and impact affordability as well.’”
From Fox 40 in California. “Financial expert explains ‘buyer fatigue’ in Sacramento housing market. After a year of skyrocketing prices and bidding wars over homes in our area, signs are finally starting to show a cooldown. Brandon Haefele, the CEO of Catalyst Mortgage, joined Mae to share some of the data and where we could go from here. Haefele said the housing market is seeing ‘buyer fatigue,’ presenting a great opportunity for people who have been sitting on the sideline to jump in.”
The New York Post. “A 93rd-floor unit in the world’s tallest condo tower has sold for $28.58 million — more than a quarter off the initial asking price of $38.75 million. The four-bedroom, 4½-bathroom unit is at Central Park Tower, which rises 1,550 feet tall at 217 W. 57th St. The 4,296 square feet comes with a relatively modest monthly maintenance fee of $6,336 a month. So far, 15% of its 178 units have sold.”
“Condo units on Billionaires’ Row have been taking a hit lately, as the US government slightly tightened its anti-money laundering laws to make it a little less easy for anonymous entities to stash dirty cash in American real estate, which helped transform some towers into personal piggy banks for global kleptocrats.”
“‘Manhattan new developments offered a 10.3% discount on average in Q2, so this transaction at Central Park Tower isn’t an anomaly,’ said Kael Goodman, CEO of Marketproof. ‘Billionaire’s Row has the city’s highest concentration of units asking above $20 million and there is abundant shadow inventory at that price point. Developers looking to make a sale are likely to continue offering discounts, even if they’re selling what’s considered a premium product.’”
The Philadelphia Inquirer in Pennsylvania. “National Realty Investment Advisors is known in Philadelphia for the thousand-plus rowhomes it has built for investors to rent out and as the owner of one of the city’s biggest development sites. But there is much that NRIA hasn’t highlighted in its messaging. Federal prosecutors have charged a key executive, Thomas Nicholas Salzano, 63, with fraud, saying he used phony loan papers to try to reel in an investor. Salzano helped lead NRIA after he settled with federal regulators in a previous financial fraud.”
“The FBI and the U.S. Securities and Exchange Commission, as well as financial regulators from three states, are investigating the firm. NRIA itself cited those probes in a recent prospectus for potential investors. No criminal charges or civil complaints have been made against the company.”
“Few of its biggest projects, so far, are contributing to those payouts. The former casino site in South Philadelphia, for one, where NRIA has said it plans a ‘private gated community’ of three big apartment buildings, remains unbuilt. Consequently, NRIA has another way of paying its existing investors: cash from new investors, as it noted in the prospectus, published in July. Experts say it’s risky for an investment fund to operate this way, since it may require ever more participants to be brought on board, rather than making money from its business.”
“Claiming credit for at least some of NRIA’s recent regulatory scrutiny is self-styled corporate whistleblower Barry Minkow, who has himself been imprisoned for running scams of his own — twice. ‘This is the craziest thing I’ve ever seen,’ Minkow said of the firm’s alleged activities in an interview. ‘And I’m a crook.’”
“It’s unusual for funds to use investor contributions, rather than income from the assets they manage, to make payouts to members, said Christophe Terlizzi, a veteran Philadelphia commercial real estate banking executive who now works as a consultant. Unless or until such funds’ actual businesses start turning a profit, they’re stuck chasing down ever larger numbers of new investors to avoid defaulting on existing ones, which they may not be able to continue doing indefinitely, Terlizzi said. ‘When the music stops, there’s nothing to distribute,’ he said.”