A weekend topic starting with The Street. "Research from real estate investment firm Amherst Group, as cited in Forbes, shows that the housing market is overvalue by as much as 40%. Amherst manages $16.8 billion in capital for investors and is one of the country's largest owners of single-family homes for rent with about 44,000 residences across 19 states. 'Is this another 2009 and 2010? We don’t think so, probably not even close. But when this price condition occurs, the world is a dangerous place,' Sean Dobson, CEO of Amherst, said. Amherst says that the pricing boom that began at the start of 2021 that drove prices 17% higher through summer 2022 can be blamed on 'exotic monetary policy.'"

From Fortune. "After four decades of low inflation and low interest rates, the era of cheap money has ended—and the tailwinds he’s seen throughout his real estate career have turned into headwinds, Ross Perot Jr. says. High interest rates coupled with tightened credit, that’s made borrowing more expensive and more difficult, along with the transition to working from home, has Perot suggesting that 'commercial real estate, overall, will slow down,' and potentially head toward a recession."

"'It’ll be years before we really understand the damage the pandemic did to the world,' Perot tells Fortune, adding that for one, 'it broke the habit patterns of millions of people that used to go to work everyday in a real office.'"

"All eyes are on the office sector, and as Fortune’s previously covered, some say it’s already crashing. Fred Cordova, chief executive officer of Santa Monica–based commercial real estate brokerage firm Corion Enterprises, recently told Fortune that 'what’s happening in the office sector is apocalyptical: We’re creating this huge class of zombie buildings, buildings that no one wants to put any money into because the capital structure is broken.'"

The New York Daily News. "Empty windows and 'for rent' signs line 125th Street in Harlem, one of the most iconic business corridors in New York City. On one block alone, between Frederick Douglass Boulevard and Adam Clayton Powell Jr Boulevard, where the Apollo Theater sits, there are nine shuttered storefronts. In spring 2020, when COVID lockdowns were in place, storefront businesses lost months of revenue — but they still had to pay rent. As they struggled to get by, many fell behind. When normal life started to resume, though, retail shops struggled to get back on their feet as rents rose more, making the situation even worse."

"'We have like these little pockets of stores that are not open,' said Princess Jenkins, owner of The Brownstone, a clothing boutique. 'When businesses start to close like that, especially when you have three foreclosures on one block ... It’s a huge piece of the community that’s missing.'"

KTVU in California. "AT&T is the latest retailer to announce they are vacating a prime real estate location in San Francisco near Union Square. The reasoning behind the closure may sound like a broken record by now. The Powell Street area has already lost several major retailers, including Old Navy, H&M, and Uniqlo. The need and concern for downtown San Francisco to reinvent itself in the wake of rampant vacant storefronts has been well documented."

The New York Post. "San Diego’s homeless encampment ban is 'doomed to fail' without tougher enforcement as homelessness reaches a crisis point in the California city, its former mayor told The Post. The 'unsafe-camping' ordinance was passed on Tuesday by a 5-4 vote and bans rough sleepers from many areas in the city, but former San Diego Mayor Kevin Faulconer said its not enough to solve the issue. 'This is not a partisan issue — both Democrats and Republicans equally don’t want to be stepping over needles and feces on their way to work or to their local park,' Faulconer told The Post. 'We should take zero tolerance for tents in front of somebody’s house and in front of somebody’s business.'"

From Fox News. "Kate Monroe dodged used hypodermic needles, discarded food containers and human waste as she navigated an area of San Diego known by locals as the Bottoms. The Marine Corps veteran and business owner was there to talk to as many of the city's homeless residents as possible, including one woman who said San Diego makes living on the streets 'not that hard.' 'Usually we're low income and when you're low income, you get free phones, free food, free clothing, there's so many resources that are just give and give and give,' Mary said in a video Monroe shared. 'I think we're spoiled to be honest with you,' Mary added. 'My sister's like, 'Where do I sign up?’"

KOMO TV in Washington. "The Seattle City Council quietly killed a proposal to build up to 900 housing units in a part of town that has been impacted significantly by chronic houselessness. 'It's just a challenging environment. It's hard to properly manage because of the deferred maintenance, and it is even harder because of all the crime,' said Bill Vipond, who manages multiple properties south of Edgar Martinez. He says he’ll try to fill the neighborhood with temporary tenants like the Stranger Things or the Van Gogh Experiences. But he said those venues are temporary. The other issues remain after years of decay after the pandemic that took a toll on the neighborhood. 'Just kind of putting lipstick on a pig with that stuff because after hours, It's dangerous again,' he said."

The Stranger in Washington. "What I want to consider in this post is one part of the social, political, and cultural impact of CHOP (Capitol Hill Organized Protest), initially called CHAZ (Capitol Hill Autonomous Zone). This part is political. And though the protest lasted barely three weeks in June 2020, it is still very much with us today. We have not left its shadow. The feeling that officers are leaving the SPD in droves is structured by this event, which has its origin in a protest that demanded nothing more or less than equal treatment under the law. The Seattle Is Dying feeling was intensified by CHOP, and we can also see it as the event that accelerated the homeless sweeps that now define Bruce Harrell's rule of City Hall."

"This is nothing but an identity crisis for a city that, in 2013, elected a hardcore socialist and a number of unrepentant progressives. How did we get from there to a Republican city prosecutor? Much of the answer can be found in the BLM protest, concentrated by CHOP, and its moment, a lockdown that suspended the economy. The combination (protests, lockdown) plunged not only Seattle but many American cities into a political confusion not experienced since surbanization. A homeless crisis caused by an obvious lack of really affordable housing exploded like never before."

The Telegraph. "With nearly half a million home loan borrowers rolling their fixed-term loans every three months over the course of this year, the ratchet is tightening. As someone wryly pointed out recently, 'When does your fixed rate end?' has become the new 'Have you watched any good box sets recently?' go-to dinner party conversation starter. Investors are worried the UK has a particularly sticky inflation problem – both literally and metaphorically. Core inflation – the bit that central banks focus on because it excludes volatile elements they can’t influence much like food and fuel – is higher in the UK than in any other G7 country."

"Given that the Bank of England is widely perceived to have been asleep at the controls when inflation first took hold, the assumption is that policymakers will err on the side of being overly vigorous in attempting to stamp out price rises in the coming months. That’s leading to higher mortgage costs. 'The Bank of England is caught between a rock and a hard place, as it has to choose between pushing more mortgage borrowers towards the brink and letting inflation run riot,' says Laith Khalaf, head of investment analysis at AJ Bell."

"The total value of UK homes hit £8.7 trillion last year, according to Savills. With so much of the nation’s wealth tied up in property, ever-increasing house prices over the past few years has helped bolster consumer confidence and ensured the cash register kept ringing even as other parts of the economy have struggled. What will happen if this last remaining prop gets kicked out from under us? We may soon find out."

"Lara Poole, 37, has discovered this first hand. Having fixed in August 2021 for two years at 1.22 per cent on her one-bedroom flat in central London, she says she was 'blithely unaware' of how amazingly low the rates were – back then, she could have fixed for 10 years at below 1.1 per cent but didn’t want to feel 'tied down.' She’s just had to remortgage with a one-year fix at 5.63 per cent."

"Mortgage approvals are already at their weakest level since the financial crisis. This means - almost unbelievably – even fewer people are seeking mortgages now than during the Covid lockdowns. The fixed rate deals of around 1.6 million households are due to expire between the beginning of this year and the end of next. These are borrowers who have, for the most part, only ever known low interest rates."

"Mortgage rates are already higher than at any time since the financial crisis. Yes, they are still much lower than the nosebleed levels experienced in the late 1970s and 1980s when headline average mortgage rates were frequently in the low to mid teens. But any 'back in my day' comments can be quickly countered by the fact that today’s house prices are so astronomical that buyers have to take out much bigger (and much longer) loans to get on the housing ladder. During Margaret Thatcher’s time in No 10, homeowners were, on average, borrowing twice their annual income; today it is more like 4.5 times."

From Bloomberg. "Economists are warning that the UK economy faces a sharp recession and a flood of job losses if interest rates hit the 6% level financial markets believe is on the cards. Household budgets are under increasing strain again as mortgage costs spike, while rocketing corporate insolvencies suggest firms, particularly the smaller ones that account for the bulk of employment, are struggling to cope with higher borrowing costs. As companies released staff they were hanging on to, unemployment would suddenly spike, said Raghuram Rajan, a former International monetary fund chief economist."

"'Then you have more unemployment than you want, because these things move in a non-linear fashion. Unemployment is terrible for demand and terrible for housing because unemployed workers who can’t make their mortgage payments will sell,' he said."

"Central banks have been trying to strike the perfect balance between tightening financial conditions enough to bring down inflation and going so far that they cause a crash. Persistently high prices and wages keep piling the pressure on the BOE to raise rates further, though, adding to the risk of a 'policy error' of doing more harm than necessary, said George Buckley, European economist at Nomura. In that event, Erik Britton, chief executive of Fathom Consulting, said the BOE would only have itself to blame for not moving against inflation fast enough early last year. 'The BOE left it too long and was too vague about what it was trying to achieve,' Britton said. 'A deep recession will be seen as a failure.'"

From Vietnam Plus. "Ho Chi Minh housing is among the least affordable in the Asia Pacific region, with a median home price representing 32.5 times the median annual household income, said a report. Da Nang housing is the fourth least affordable with a median home price at 26.7 times the median annual household income. Many home buyers in HCM City are speculative investors who own multiple units, further pushing up prices, according to the report. Shenzhen in mainland China is the lowest in terms of home attainability with the highest median home prices at 35 times median household income, it noted."

From News.com.au. "Aussie filmmaker Jack Toohey, who went viral last week with a video showing how much easier it was to buy a house in 1983, has released a follow-up pinpointing what he says is the 'cause' of the current crisis. Toohey, whose initial video sparked a heated response from talkback radio callers demanding an end to 'boomer bashing,'now agrees that we should not 'squabble over which generation is to blame.'"

"He instead points the finger at the rise of 'neoliberalism' in the 1980s — raising the spectre of Ronald Reagan and Margaret Thatcher — leading to the sell-off of public assets and underinvestment in public housing. '[Neoliberalism] views the world as economies first and societies second, which is minimising the role of government and removing safeguards in the belief that free, unregulated markets are more efficient,' he says in the video. 'Homes become investments, people become resources, policies become business plans. Back to 2023 and 40 years of neoliberalism has created staggering inequality — like, holy hell.'"

"He continues that 'successive neoliberal governments from both sides of politics have defected [sic] their responsibility to plan for the future, instead opting to make a quick buck from the sale of our assets.' 'They’ve sold off public land, roads, air, education, rail, communications, banks, energy, water, natural resources, health and housing, and leave us to squabble over which generation is to blame,' he says. 'All the while the cost of living continues to grow and so do profits. The revolving door between politics and big business continues to spin. We’re in a housing crisis yet the government is only committed to build an average of 4000 new affordable homes a year. If we built at the same per capita rate as we did in the ‘60s, it would be 150,000. The neoliberal experiment has failed.'"

"Sydney and Melbourne, where the median house price is now well over $1 million, consistently rank among the most unaffordable cities in the world, alongside the likes of Hong Kong, Vancouver and San Jose. In his original video, Toohey pointed out that 'in 40 years, the average house price has increased by 14 times, whereas full-time salaries have only increased by 4.7 times.' In other words, a person today would have to be making $300,000 a year to be in the same starting position as a homebuyer 40 years ago."