Huge Backlogs That Aren’t Being Financed Due To The Glut
A report from KVAL in Oregon. "Rent prices in Eugene have gone down the past two months, according to a San Francisco real estate research firm. The Lane County Rental Owners Association has seen this trend as well. The president of the association says the reason for the drop is simply supply and demand."
"'It used to be that you would put an ad up, and you'd have 20 applications within a few hours,' said Tia Politi, the president of Rental Owners Association. 'Now it's taking longer, the vacancy factor, and rents are leveling off and in some cases dropping.'"
The San Francisco Examiner in California. "The most important package of development policies for the Bay Area — that you’ve probably never heard of — is being decided today. Going by the name of CASA, this invite-only assembly of movers and shakers was convened in late 2017 to craft a 'grand bargain' with market-rate developers in exchange for their support for affordable housing."
"The real estate interests in CASA, unfortunately, seem to be mainly focused on incentives in urban core neighborhoods and hot market cities. The Big Three cities of the region — San Francisco, Oakland and San Jose, which carry responsibility for almost 45 percent of the entire region’s housing — have already exceeded their goals for market-rate production, and have huge backlogs of approved units that aren’t being financed due to the glut of high-end development."
From Boston 25 News in Massachusetts. "With the growth of online rental sites in recent years, Alisa Magnotta Galazzi, CEO of the Housing Assistance Corporation in Hyannis says more investors bought homes on the Cape with the idea of renting them out in the summer. 'In fact, we lost 3,000 year-round housing units in the past five years and gained 6,000 seasonal homes. What we’re seeing is there is a glut of seasonal rentals on Cape Cod and people aren’t making as much money as they thought.'"
From Bisnow. "Student housing experts say a recession is coming as early as next year. But a downturn could prove once again that the student housing industry is recession-resilient, experts at Bisnow’s Annual Student Housing West conference said."
"Despite a possible recession, NB Private Capital CEO Blake Wettengel said this is a really exciting time for student housing. He is bullish on the industry making it through another downturn. 'We’ve been telling everybody for years that we are recession-proof,' Wettengel said. 'It’s time to put our money where our mouth is.'"
From Skift. "WhyHotel, a company that runs pop-up hotels in luxury apartment buildings, said Wednesday that it had raised $10 million in a Series A round of investment. So far this year it has instead created a series of 'pop-up hotels' that are really glorified vacation rentals available by the day, with daily housekeeping service."
"Chris Hemmeter,managing director of Thayer Ventures said that there’s a great deal of capital in a low-interest rate market chasing high returns and that the alternative lodging, soft brand category provides the impression of having great potential scale in a large addressable market and against a fragmented industry backdrop of no dominant players."
"But investors need to remember the risks. Hemmeter said, 'Just because VC money is pouring in doesn’t mean all bets are good bets!'"