A report from 425 Business in Washington. "SmartAsset found that the Seattle area hosts three of the top 25 spots in the lineup for the nation’s most expensive housing markets. Among the priciest is the Eastside’s Sammamish area. At the time of publication, the average price of a Sammamish home is about $1,485,583, per Zillow. Sammamish’s neighbor, Bellevue, ranked as the 19th most expensive housing market in the United States, followed by Redmond at placed 25. Despite their costly sale tags, the three neighborhoods nonetheless dropped on average 11% in price in the past year."

The Real Deal on Texas. "The first problem for multifamily investors: supply. Austin has the third-largest multifamily pipeline in the country, with 42,600 units under construction, according to Matthews Real Estate Investment Services. The city’s developers delivered another 12,300 apartments last year. In the second quarter, the homebuilding giant Lennar saw new home orders grow by 26 percent, recovering almost all its losses of the previous year. (Price reductions no doubt played a role in this, as prices were down about 10 percent year over year.) Lennar competitor D.R. Horton saw its gross profit from home sales reach $1.6 billion in the second quarter, up $100 million from two years ago but down $500 million from last year."

"'There is general downward pressure on rents as many markets have become somewhat overbuilt, and there is additional inventory being completed and coming online,' said Stuart Miller, co-CEO of homebuilding giant Lennar, in the firm’s June earnings call. Average rent in Austin peaked in August 2022 at $1,757, according to a survey of landlords. Since then, rents have fallen to around $1,680. If that line keeps trending downward, it’s a troubling sign for landlords, particularly for investors who relied on fast-growing rents to make debt payments."

The San Mateo Daily Journal in California. "The housing market in San Mateo County is rebounding after last fall’s interest hikes shocked the market but experts say there’s a lot more to go before calling it a recovery. In the second quarter, the average median sale price was $1.9 million for a single-family home, up 8.57% from last quarter. However, in the second quarter of last year, the average median sale price was $2.65 million, a nearly 40% increase. Rachel Ni, Coldwell Banker real estate agent attributes it to the change in interest rates. 'The average mortgage price is more than double from last year, and people’s capacity to get a loan is dropping drastically because of the interest rates,' Ni said."

Bisnow San Francisco in California. "San Francisco's office market slid even further in the second quarter of 2023, clocking net negative 2.2M SF of absorption, making it one of the worst quarters on record for the market. 'That's the third-worst quarter since record-keeping started at CoStar [in] 1997,' Transwestern Senior Research Manager George Entis said. 'Business leaders have had to accept that hybrid work is a permanent reality now.' The office vacancy rate stands at 31.6%, a historic high for San Francisco, according to the report. 'I don’t think there is anything to suggest the story ends here,' Entis said."

The Baltimore Sun in Maryland. "Eight years after its sale fetched more than $66 million, the office tower at One South Street in downtown Baltimore sold last month for $24 million, a markdown that could be a barometer for the city’s commercial real estate industry. Commercial real estate prices across the country are slumping and many downtowns are struggling with vacant office space. The sale of One South Street — a 30-story building that opened in 1992 — appears to be the first post-pandemic sale of a downtown office tower in Baltimore."

"Terri Harrington, a commercial real estate broker, pointed out that several high-profile tenants have left or plan to leave downtown Baltimore in recent years, including Transamerica, Bank of America, T. Rowe Price and Pandora. Pandora is moving its North American headquarters to New York, while the other three are headed for newer buildings in Harbor Point and Harbor East. 'Occupancy drives value and many buildings downtown are struggling to maintain that occupancy,' Harrington said. 'I also believe you are going to see other buildings in the same boat.'"

Bisnow New York. "New York City retail might be rebounding, but the damage done by the 'retail apocalypse' and then the pandemic is far from over. At one large Brooklyn retail property, that damage was made clear this week when a new appraisal found its value had dropped by 88% after two major departures left it vacant. The value of the 102K SF retail building at 94-110 Court St. in Brooklyn Heights has dropped from $48.7M in 2013 to just $5.7M in a recent appraisal, according to DealX data reported by Morningstar Credit."

From Barron's. "One of the most important figures in Bank of America’s second-quarter earnings report, due Tuesday, likely won’t be included in its main press release. The size of the company’s loss on a huge bond portfolio will probably be tucked into the financial supplement. The portfolio of so-called held-to-maturity securities, which totaled $625 billion at the end of March, showed a loss of $99 billion on that date. The loss reflects the drop in the bond market since that debt, mostly mortgage securities, was purchased in 2020 and 2021 at historically low interest rates of around 2%. Based on JPMorgan’s second-quarter profit report released Friday, the Bank of America securities losses may have widened a little in the second quarter, reflecting a modest drop in mortgage-backed securities prices. The JPMorgan loss was about $33 billion on June 30, versus $30 billion on March 31."

CBC News in Canada. "After reaching record high sales prices at the height of the pandemic, the cottage market in Ontario has mostly softened into balanced territory. In Peterborough and the Kawarthas, the average cottage sale price dropped from about $1.24 million in the first quarter of 2022 to about $856,000 in the first quarter of 2023, according to ReMax's 2023 cottage trends report. The number of sales in that area also dropped by nearly half. Closer to Ottawa, in the Rideau Lakes area, average cottage sale prices took a more modest dip of about five per cent, from about $990,000 in Q1 of 2022 to about $940,000 in Q1 of 2023. Sales remained steady."

"Back in the summer and fall of 2020, bidding wars for cottages in and around Ottawa were resulting in final sales of about 50 to 70 per cent over asking prices, according to local realtors. Some of the listings going up for cottages in the Peterborough area include people who bought during the pandemic and are being dragged back to their jobs, or who have realized that cottages require a lot of work, said Greg Ball, owner of Ball Real Estate Inc. in Peterborough."

Prince Albert Now in Canada. "The amount of homes bought and sold in Prince Albert in the last month has dropped compared to a year ago, but the benchmark price has increased. Local realtor Jesse Honch said the pandemic changed the nature of the service sector which has, in turn, changed the type of property people can buy. Houses in the 100,000 to $250,000 range are down almost 20 per cent in that price this year compared to last year. Federal policy changes during the pandemic such as dropping the interest rate to 1.5 per cent and removing the stress test of an extra two per cent caused the real estate boom because buyers could add $100,000 to the value of the home they could afford."

Leeds Live in the UK. "Councillors in Leeds say they fear there may be too many student flats springing up across the city centre. There has been a huge rise in the number of student accommodation developments being put forward in the city since the Covid pandemic. Members of a local authority’s plans panel expressed concerns about the proliferation of student flats and the prospect of 'ghost town' areas during the summer months when courses end. Councillor Dan Cohen told the meeting: 'When the students are not there it feels like a ghost town. There comes a point for me where I can’t keep supporting, time and time again, student accommodation when there seems to be an oversupply.'"

The Nelson Mail. "Nelson median house prices have dropped by 17.2% in a year, the largest fall in the country, leaving questions about how much lower the market can go. The big drop was in the Real Estate Institute of New Zealand’s monthly property report for June, putting the Nelson median price at $650,000, down from $785,000 a year ago and $770,000 in May. In Tasman, the fall was shallower with the median price down to $800,000 in June compared to $865,000 a year ago, a drop of 7.5%. Nationally, median prices for June were down 8.2% from last year. After Nelson, the next largest drop in June prices was 13.3% in Otago, 12.5% in Auckland and 10.4% in Marlborough. The REINZ report also showed the median days to sell in Nelson in June was the highest since 1999."

"Nelson real estate agent Kat Campbell believed the sharp drop in the city was a rebalancing of prices which had been among the fastest, highest risers in the country in recent years. The longer selling times tallied with what she had witnessed, with factors including the wider choice now available to buyers who had no urgency to make a purchase. A couple of years ago, a house sale could be settled within three weeks; now it could be four to five weeks before they started seeing offers. Buyers were also very hesitant, worried that they were overpaying, she said."

From CNBC. "China Evergrande Group posted a combined loss of $81 billion in its long overdue earnings report late on Monday. The world's most indebted property developer fell into default in 2021 and announced an offshore debt restructuring program in March, having struggled to finish projects and repay suppliers and lenders. Evergrande's net losses for 2021 and 2022 were 476 billion yuan ($66.36 billion) and 105.9 billion yuan ($14.76 billion), respectively, as a result of writedowns of properties, return of lands, losses on financial assets and financing costs, the company said."

"Evergrande's colossal debt pile in recent years has become the source of serious concern about China's property sector, a bedrock of the Chinese economy, with defaults and abandoned property projects seen across the country. The company's proposed restructuring is due to be heard at the High Court on July 24. JPMorgan estimates that around 50 property developers have defaulted on $100 billion of offshore bonds over the last two years, while dozens have been suspended from trading on the Hong Kong stock exchange."

"CreditSights tracks the monthly contracted sales figures of more than 30 developers, and Sandra Chow, co-head of Asia-Pacific research at CreditSights said only eight had reported increases in their sales numbers. 'Unsurprisingly, all of those are the state-linked or the stronger developers, so we're seeing this increasing bifurcation where the strong developers are the state-linked, the large players, and the smaller ones are kind of left to languish, and it will be an increasingly consolidated sector,' Chow explained. 'Understandably, if you're a homebuyer, you're not going to buy a house from a weak player as well because there's that risk that the developer will not be able to complete your house on time and then you're going to be left with that liability, so it's quite hard to see how the smaller developers will regain homebuyer confidence and then get the cash in to turn around their businesses.'"