A report from the Douglas Digital Daily in California. "Forget what’s fashionable in floor plans, decor or color palettes. This year’s hot housing flavor is something every house hunter can agree upon: a price discount. It’s no blip. The frequency of price-cutting in Southern California statewide and across the nation is running at or near post-recession highs."

"When I filled my trusty spreadsheet with among the 50 largest metropolitan areas, I found 43 with increased discounting in the 12 months ended in August vs. the previous 12 months. Five of the 11 big metros with the steepest jumps in price reductions were in the Golden State. So, who’s lowering asking prices the most? Silicon Valley. The San Jose metro area’s 115% jump in its discounting rate over the past 12 months meant 15.9% of sellers had cut their asking price."

"In Southern California, more sellers are cutting prices, too. Los Angeles and Orange counties had the No. 7 jump with 28% increased discounting. As for the Inland Empire, it had the 11th-largest growth in price cuts: Up to 16.1% (No. 28) from 13.7% (No. 20) — an 18% increase. Big California upswings in discounts were also found in San Francisco. A 67% jump, to No. 3 nationally, pushed price-cutting to 12.2% of listings."

"Now remember, cutting listing prices is no guarantee that house hunters will bite. That’s likely a reason why you see some of the nation’s once-hottest housing markets filling out the Top 10 for increased price cut. Las Vegas had the second-biggest surge in reductions, running to 22.5% this year from 12.3% a year — an 82% jump. No. 4 was Seattle, 14.6% from 9.3% — a 56% increase. Then there was No. 6 Denver: 18.1% from 13.8% — up 31%; No. 8 Atlanta: 15.1% from 12.3% — up 23%; No. 9 Salt Lake City: 19.6% from 16.1% — up 22%; and No. 10 Kansas City: 13.2% from 10.9% — up 21%."

"Ah, housing price cuts. Everyone complains about affordability … and now house hunters get what they’ve wished for: Discounts! Of course, lowered prices can be a doubled-edged sword. When housing markets cool, plenty of buyers get cold feet fearful of overpaying for housing."

The Record Searchlight in California. "Build 3.5 million new dwelling units across California by 2025 and this state’s housing shortage will be solved, Gov. Gavin Newsom prescribed during his campaign last year and many times since. SB 50’s likely failure was implied last spring, when MetroStudy reported that 3,700 newly-built homes went unsold in Orange, Los Angeles, Riverside, and San Bernardino counties during the first quarter of this year."

"That left unsold housing inventory up 22 percent from last year and 37 percent above the five-year average. It caused a slowdown in construction at the very time Newsom and others wanted more building, with new home development in the state’s most populous region down 18 percent year over year."

"This was market forces at work: Even though builders dropped the price of new housing below the regional median price, they could not drop it below the $425,000 average cost of building an apartment or condominium in a typical 100-unit project. Instead, most new units must be sold for about $600,000 in order to push the price of 'affordable' new units in each development down to $350,000 or less."

"Such numbers are needed for developers to make any profit, a prerequisite if anyone expects them to build anything. But at those prices, there aren’t enough buyers to sustain the kind of building boom California needs."

The Real Deal on Florida. "It’s a buyer’s market in Miami, and a new startup wants to capitalize on the glut of condos on the market. New York City-based Compound, led by CEO Janine Yorio, is under contract to purchase a unit at Brickell City Centre, and will open up a vehicle for accredited investors to buy shares. Using the same model, the investment firm hopes to buy hundreds of condos that it will lease to renters. Yorio compared it to Blackstone’s strategy of buying over 10,000 single-family homes that it ultimately took public as Invitation Homes."

"The Miami unit is Compound’s first using the investment model. Each individual unit will be owned by a real estate investment trust that Compound sets up. Compound is under contract to pay $445,000 for a unit at Reach at Brickell City Centre, with closing expected in two months. Shares of the unit will be priced at $4.80, with a minimum investment of $4,800 or 1,000 shares – and will be capped, per investor, at 10 percent of the entire unit’s ownership. Accredited investors will be required to have a net worth of about $2 million to qualify."

"Compound plans to rent the condo for 12 months, and is targeting an internal rate of return of about 17 percent. Investors would receive annual dividends from the net cash flow generated from the rental stream, but the idea is that they would make their money when Compound sells the unit, typically after a long-term hold."

"Owners of newly completed condos in Miami and some other markets across the country are struggling to recoup their investments as they list units at the same time the developers are still trying to unload even newer product. That provides an opportunity for buyers. The sellers of the Brickell City Centre unit, Harley and Nichole Hines, paid $582,900 for the condo in 2016, when Swire Properties completed Reach and Rise. Both condo towers connect to the mixed-use development in the heart of Brickell."

"The one-bedroom, 879-square-foot unit at Reach hit the market in June for $500,000 with a price reduction in September to $475,000, according to Realtor.com. If it closes for the purchase price of $445,000, the Hineses will have sold their unit at a 24 percent markdown compared to what they paid three years ago, a loss that does not include carrying costs like monthly maintenance fees and insurance. The HOA fees total $789 a month for that unit, according to the listing."

The Wall Street Journal on New York. "It is too soon to know how badly New York City’s new rent control laws may batter apartment landlords. But a battle heating up in Israel between a Brooklyn-born developer and a short seller may provide an early clue. Joel Wiener, chief executive of Pinnacle Group, rose to prominence by buying up thousands of rent-stabilized New York apartments, many of which he renovated or converted to condominiums. His firm has raised funds by selling more than $500 million in bonds on the Tel Aviv stock exchange, making Pinnacle one of the largest bond sales by a foreign company in Israel’s history."

"Now, at least two investors are shorting the Pinnacle bonds, or betting that the prices will fall further. The new laws make it harder for landlords to raise rents, evict tenants or convert rent-controlled units into market-rate apartments or condos, and the two investors are betting this will push down the value of Pinnacle’s portfolio and could force it to default on its bonds. Pinnacle has nearly 1,800 unsold condominium units in its portfolio, bond documents show, and most are still occupied by renters."

"'To me it seems like everyone is looking the other way. No one wants to admit the shift happened,' Ori Eisenberg, one of the short sellers said in an interview. 'The moment that will be recognized, there will be major implications.'"

From Mansion Global on New York. "Wealthy house hunters in Manhattan signed contracts for only nine homes in the week ending Sunday. It’s the fourth time this year that new pending sales in the borough’s luxury market were in the single digits, according to the report from Olshan Realty. Anemic home buying in the world’s financial capital follows myriad factors—including unfavorable tax changes for the rich—that have weighed on demand for trophy homes in the city."

"Sellers and developers have had to counter the slowdown by slashing prices. For instance, homes that went into contract last week had an average price cut of 10%. After the unit at 432 Park Avenue, the second most expensive home to find a buyer last week was a penthouse asking $13.5 million at Midtown new development 135 West 52nd St. Developers originally listed the five-bedroom aerie four years ago and have cut at least $3.3 million off the asking price since then."

From Bravo TV on New York. "After being unable to secure a buyer over the past few years, Bethenny Frankel has dropped the price of her sexy Soho condo in NYC to a number below what she paid for it just five years ago. The Real Housewives of New York City alum purchased the two-bedroom, 2,392-square-foot property, located in a prestigious building on a cobblestone street, for $4.2 million in 2014 to renovate and share with her daughter, Bryn. She and Bryn moved out of the condo and listed it for sale for $5.25 million back in 2017, but Bethenny never found a buyer for it. She then re-listed it in April for a much lower asking price of $4.38 million."

"Now, the price for the condo has dropped to $3.995, which would put Bethenny at a financial loss; she hasn't disclosed how much she spent to renovate the condo. She offered the condo for rent at $13,500 per month in 2017."