A report from WDSU in Louisiana. "The insurance crisis has now reached a catastrophic level as it cripples a vulnerable population of homeowners in the greater New Orleans area. According to Habitat for Humanity's CEO Marguerite Oestreicher, about 140 mostly 'older' habitat for humanity homeowners are on the brink of foreclosure. Another 75 to 100 are hanging by a thread. 'I mean, there are people who call in tears. There are older people who are like, I don't know what to do. I can't go live on the street. I can't lose my house,' Oestreicher said. She says mortgages have doubled since the insurance crisis. Most of those facing foreclosures are older and retired with nowhere to go. Habitat for Humanity serves as both a homebuilder and lender for more than 750 homes in the New Orleans area. They have been working with the homeowners who are behind on their mortgages, waiting for them to catch up. But now, they're pushed against the wall. Oestreicher is asking the city for $2 million."

From WFLX. "If your homeowners insurance has gone up a lot in recent years, you are definitely not alone. 'Yes, almost double in the last two years,' said Gabriella Hernandez, who owns a home in the Vedado neighborhood of West Palm Beach. According to Florida Tax Watch, homeowners policies in the state have jumped on average 42.5% since 2019. For people like Gabriella, the options are not many. 'If we sold the house anyway, we don’t have enough money to do something different,' she said."

CBS Bay Area in California. "A real estate holding company that allowed a group of Sonoma properties to lapse into foreclosure has left investors and the city itself with an uncertain future. On August 8th, the first dozen properties are scheduled to be auctioned off to the highest bidder. The property purchases began very quietly, with dozens of homes being bought, often in off-market sales. They were followed by familiar businesses in the heart of downtown. 'Then it became, quite quickly, a concern about one person buying up lots and lots of property, and controlling the rents and the merchants, and a lot of private property,' said Sonoma resident Josette Brose-Eichar."

"That 'someone' was Ken Mattson, the head of a real estate investment company called LeFever-Mattson. Eventually, a citizens group called 'Wake UP Sonoma' formed to investigate what was going on. And president Lisa Storment said they discovered the purchases followed an unusual pattern. 'Buy really high, way over asking price -- like ridiculously over asking price -- and then sell back to one of their own LLC companies at a really depressed rate,' said Storment. 'It would sit there for long, extended periods of time with no attempt to try to improve the property.'"

"In all, more than 120 properties were bought around town. No one really understands the strategy behind it. Recently, the wheels of the enterprise have fallen off. Mattson's partner, Tim LeFever, has accused him of stealing from the company. The two former friends are suing each other. Many of the properties have fallen into foreclosure, allegedly because Mattson stopped making payments on the loans. And the residents fear the city will also take a hit for Mattson's buying spree. 'When they were bought, they were bought at such a high level over asking price, over value, that it increases the property values in our area,' said Storment. 'And then, when they're going to get sold, there's going to be a dive in our economy.'"

The New York Post. "Prominent Big Apple developer Michael Shvo was slapped with a lawsuit by a disgruntled couple who plunked down $6.1 million for a pad at the Mandarin Oriental Fifth Avenue, claiming the luxury building is riddled with problems. John Goodman and his wife, Diane Johnson, alleged that the building developed by Shvo at 685 Fifth Ave. is 'plagued by construction defects, unfinished amenities, a pervasive sense of neglect, and compromised services.' The couple, which goes by the Goodmans, said their 18th-floor unit 'is now effectively worthless. Their dreams have been shattered, leaving them with a substantial financial loss and a profound sense of betrayal,' according to the lawsuit. The Goodmans also claimed that the building is a 'virtual ghost town,' and alleged that only 16 out of 64 units have sold after three years."

From Bisnow. "Commercial property owners are losing their properties to their lenders at the highest rate since 2015. Last month, ratings agency Moody’s placed six regional banks under review, with potential for a ratings downgrade, due to office and other commercial real estate exposure. Since the onset of the pandemic, the financing motto has been 'extend and pretend,' but the caution exhibited by banks signal that era may be over. 'Lenders and borrowers will be forced to ‘face the music’: In the near term, we expect further declines in appraised valuations and price indices, making loan extensions even more difficult to rationalize,' according to a report by Pimco."

The Wall Street Journal. "Distress is working its way through the financial system after more lenders conclude that obsolete office buildings won’t recover their former value, even when interest rates decline. That is leading to sales of foreclosed properties and distressed mortgages. It is also bringing an increase in short sales, where lenders and borrowers work together to unload troubled property for whatever they can get. Numerous office buildings have sold at steeply discounted prices in the struggling office market in Washington, D.C. That has made it hard for lenders with outstanding loans to keep distressed loans on their books for their original values. In the district, State Farm Life Insurance recently conducted a foreclosure sale of an office building a few blocks from the White House for $17.6 million, more than 70% below what the owner had paid in 2010."

"These days owners increasingly are giving up, recognizing that demand levels for their buildings won’t return. Many are simply working with their lenders on short sales, which typically aren’t counted as foreclosures. Indeed, the volume of commercial-property sales that involved lender participation soared 83% in the first and second quarter of 2024 from the two previous quarters, according to Ten-X, one of the biggest auctioneers of commercial property online. 'This cycle, a lot of investors believe office values are challenged,' said Nicholas Seidenberg, managing director at the real-estate investment banking firm Eastdil Secured. 'They’re saying: ‘Hey, I’m going to just walk away and not fight.’"

From Mises.org. "From roughly 2020 to 2022, 'syndicators' took over the apartment investment market. During that time, this group of dimwitted rent seekers used bridge loans to finance their apartment acquisitions. At 85% leverage, the bridge loans left only a sliver of equity to raise, for which these syndicators used third parties or online platforms built for anonymous fundraising from average Americans with cash to burn and no place to earn a yield in the zero interest rate environment of the time."

"To the extent there was a business case underlying these acquisitions, it involved two sets of assumptions. First, that heavy renovations on apartments, financed by additional bridge loan money, would lead to immediate and massive increases in rent. Second, that benchmark interest rates would stay at or near zero for the foreseeable future."

"These assumptions were foolhardy for a variety of reasons, but the point is moot. Syndicators’ primary motivations involved pocketing acquisition fees — collected up front and not tied in any way to future performance — before the Fed turned off the money tap and investors realized they had been duped. To that end, they’ve been wildly successful. Many of their investors, on the other hand, lost everything. One of the most voracious syndicators during the apartment bubble was Tides Equities, based in California. Headed by Sean Kia and Ryan Andrade, possessing a combined skill set that might equal that of a middling undergrad analyst, Tides ultimately acquired over 30,000 apartment units — a staggering figure for a team with no apparent investment management acumen."

"These two amassed over $8 billion in assets under management. Unfortunately, they were unable to keep the momentum going. After a solid two years stacking up mediocre properties at obscenely high prices, the Fed increased benchmark interest rates. One need not be familiar with every syndicator to understand their basic nature: largely unskilled, inexperienced, and emotionally undisciplined but deeply motivated by rent-seeking — the acquisition of wealth not by creating value but by deftly prying it from others."

"Other syndicators whose fortunes have fallen include Rise 48, ZMR, and Nitya Capital. In each case, the story is the same. Talentless but ambitious founders rushed to fund property acquisitions during the bubble that went pear-shaped when rates increased. Properties owned by these syndicators are now largely distressed, in many cases sporting debt service coverage ratios under 0.5, meaning the properties generate less than half of the cash required to make loan payments."

The Financial Post. "Canadian housing markets have taken some knocks over the past few years as interest rates and inflation soared, but few have had it as rough as Toronto’s condo market. The problem is prices are too high for investors, which make up 70 per cent or more of presale buyers, and developers can’t lower prices because of high construction costs. The high cost of building condos these days is reflected in prices. New condo prices are down only 5 per cent from their high, while resale condo prices have fallen by 12 per cent. Developers are offering incentives and rent is up 30 per cent from pandemic lows but 'it’s not enough,' said the report. 'Quite simply, new condo investment doesn’t work at the current market average price of close to $1,400 psf (per square foot),' it said."

"So what is the math? The reality is that many condo investors are losing money. Of owners with a mortgage, 52 per cent were cash flow negative in 2022, meaning rents were not covering ownership costs which include mortgage, condo fees and property taxes . By 2023 that share had grown to 77 per cent and by the first quarter of this year, it reached 82 per cent. The bigger the condo, the larger the negative cash flow, said the study."

The Globe and Mail in Canada. "238 Harvie Ave., Toronto. Asking price: $1.9-million (May, 2024). Previous asking price: $1,949,000 (April, 2024). Selling price: $1.8-million (May, 2024). Agent Ira Jelinek chauffeured his clients to dozens of properties across Toronto matching their changing needs over the past few years. The first one they were ready to buy was this three-bedroom house abutting Prospect Cemetery, just north of St. Clair Avenue. Their offer was declined, but after it was pulled off the market, they reapproached the seller with a sweeter price, hitting the top of their $1.8-million budget. It was accepted. 'We offered a bit higher, but not as high as what the seller wanted,' said Mr. Jelinek. 'Right now, it’s definitely a buyer’s market.'"

The Daily Telegraph in Australia. "It’s not just the temperature that’s colder this year – a deep chill has swept much of NSW’s popular winter holiday market, with homes in popular ski locations listed for discounts. PropTrack figures showed property prices across the Snowy Mountains region were about 11 per cent below figures seen last year, with competition for housing falling rapidly amid higher rates. Many snow homes have sold with much larger discounts than the 11 per cent average price drop in the region, with up to $500,000 shaved off the original list prices in some instances. SQM Research director Louis Christopher said holiday home sales reflected a trend among homeowners to do everything they could do preserve the family home. 'If repayments start to become more unaffordable, the last thing most people want to do is sell the family home. So the holiday home, the car, the private school for the kids all go first,' he said."

From 7 News. "Noeleen and Jack Miller were excited to be living the Australian dream in a new beachside home, but their experience with one of South Australia’s oldest and most well-known builders has left them in a 'nightmare.' The couple, originally from South Africa, is among several customers of Rossdale Homes who have come forward with complaints about workmanship, warranties not being followed through and a lack of communication. Construction on Noeleen and Jack Miller’s $735,100 home in North Haven began in June 2022. At the frames stage, when they engaged an experienced building inspector, they were told control joints were missing in two different areas of the home."

"The inspector told 7NEWS.com.au that if an engineer had not approved fewer control joints, the house was at risk of cracking, which could lead to issues with waterproofing and - in the worst-case scenario, mould could compromise its structural integrity. Despite the couple’s numerous attempts to get documentation from Rossdale that an engineer had signed off on the joints not being required, they still have not received the paperwork. The couple said they felt pressured to make a progress payment to continue construction because they needed to move out of their rental."

"Jack said he now feels 'sick' and starts to shake whenever he hears or sees promotions for Rossdale. 'You pay the money hoping they’ll come back (to fix defects) but they don’t,' Jack said. Noeleen said the family 'haven’t got our money’s worth' after being promised a custom-built home. 'I would lie awake at night so frustrated. Sometimes I’d just lie there and cry,' Noeleen said. After the handover, they had loose threads in carpets, cracks in a wall and the staircase, loud whistling throughout the house on a windy day, bricks that needed cleaning, and tiles that were unevenly laid. 'They rule unto themselves,' Noeleen said. 'You actually have no recourse. They put you in a position when you can do nothing, just wait for them to do what they want, when they want.'"

South China Morning Post. "A fresh wave of selling in Chinese stocks has sent shivers down the backs of the 220-million-strong army of retail investors in the world's second biggest-market, as memories are revived of the implosion a decade ago, which shaved a third of the aggregate valuations. A 3.7 per cent decline in the CSI 300 Index last week has taken to 7.6 per cent its loss from this year's high in May, as pessimism grew after a high-stakes Communist Party's third plenum offered little by way of policy support. The resumption of the downturn in stocks is a setback for those hoping for a sustained turnaround after a flurry of state interventions over the past year."

"With pessimism swirling, any rebound may be short-lived as disappointed investors are waiting in the wings to offload their battered portfolios. Yan Xiaosen, who has seen his 2018 investment of 500,000 yuan in stocks and mutual funds shrink by 40 per cent, said he would sell if the rebound in the Shanghai Composite Index, a gauge popular among individual investors, pushes it above the 3,000-point mark. 'I have lost faith in the nation's economy and the listed companies,' said the 47-year-old sales manager with a kitchen utensil maker in Shanghai. 'It's unreasonable for us to recover the losses in the next one or two years because the market is witnessing a crisis of confidence.'"

"Sissi Liu, a Shanghai-based housewife, has turned her back on trading stocks since she dumped all her holdings in 2018. Now, she would rather put her money in time deposits, even if it means an annual yield of 1.35 per cent on a one-year term. 'My decision to exit the stock market is right,' she said. 'Why bother investing in a market that is not so different from a casino?'"