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There Is A Bubble To Burst

A report from Reuters. “First Republic Bank faces dwindling and tough options to turn around its business with the creation of a ‘bad bank’ or asset sales possibilities, a source familiar with the matter said, after the lender disclosed it lost more than half its deposits during last month’s banking crisis. ‘If someone were to acquire them … there’s going to be some big writedowns that would have to be taken against some of the assets given the rate cycle,’ Christopher Wolfe, head of North American banks at Fitch Ratings, told Reuters, referring to the bank’s mortgage loan book and securities portfolio. ‘The options are very challenging and probably very costly, especially for shareholders,’ Wolfe said. ‘Who’s going to bear the cost?'”

7 News on Washington DC. “Those intense bidding wars we saw through last spring are a thing of the past. ‘If you’re slightly off on your offering price and where you position your property, buyers are going to look at it and think about it and ask ‘is this a good value?’ said Harrison Beacher, a realtor with Keller Williams Capital Property. ‘In the last 30 days Melanie, I’ve had listings go almost 15% over list price and another one that had to reduce the price twice almost 10% below listing price in the same market.’ If the price is not right, that property could sit for weeks.”

Go Banking Rates. “While many buyers and sellers are anxiously waiting to see what happens next, Ruth Shin, CEO of PropertyNest, based in Brooklyn, New York, said a complete housing market crash this year is unlikely. ‘It is not currently a great market for sellers and is turning more and more into a buyers’ market, with the peak yet to come,’ she said. More significant price drops might happen, but she said that probably won’t happen until mid-to-late summer. ‘The conditions, while at times extreme in the past few years, are nothing like they were leading up to the housing crash in 2008,’ she said. ‘There is a bubble to burst but not at the same dramatic level.'”

The Wall Street Journal. “Apartment rents in Manhattan are soaring to new highs this year, even as rents plateau or fall in most of the rest of the country. Blackstone Inc. risks losing a portfolio of Manhattan apartments anyway. The real-estate and private-equity firm is in danger of defaulting on a $270 million loan backed by 11 apartment buildings in New York’s most expensive borough. Cash flow from the properties isn’t enough to cover the cost of all the debt, according to a report from Moody’s Investors Service.”

“There is $37 billion worth of securitized multifamily loans set to expire in the next two years where rental income either isn’t enough to cover debt payments, or covers it with less cushion than is considered standard, according to real-estate data firm Trepp LLC. For comparison, that is more than twice the amount of at-risk loans in the office sector. ‘I think there’s going to be a lot of buyer’s remorse,’ said Manus Clancy, senior managing director at Trepp.”

From Bisnow. “Investment in office properties across the country fell 68% in the first quarter to $10.7B, the lowest level since 2010 and an indicator of the degree of deep freeze property markets plunged into after their most challenging year in more than a decade. Sales of all property types declined, according to Colliers, citing new MSCI data. ‘It’s a frightening tsunami of problems coming at us, because there’s not a lot of demand for office — especially for Class-B and C buildings,’ Compass Vice Chair Adelaide Polsinelli told Bisnow. ‘This is absolutely the new normal where properties, especially office, are selling at losses. Valuations have dropped significantly.'”

KVUE in Texas. “Appraisal districts are required to value homes on Jan. 1 of every year, and homeowners in Williamson County may start seeing a decline in the value of their homes. Homes in the county are indicating a value decrease of around 11% from Jan. 1, 2022, to Jan. 1, 2023. ‘We started seeing sales towards the end of last year that were lower than what they were at the beginning of the year. So we noticed that decrease, and it applied those values to the properties for this year,’ said Alvin Lankford, chief appraiser.”

The Tri-City Herald in Washington. “Welcome to 2023, when the residential real estate market is much cooler after mortgage interest rates doubled as the federal reserve raised the funds rate to combat inflation. Dave Retter, owner of Retter & Company — Sotheby’s International Realty in Kennewick, said open houses picked up dramatically by February in stark contrast to the early pandemic days. Homes then were ‘flying off the shelf with 10 or 20 offers. You list on a Friday and it probably sold before a Sunday open house,’ he said. He called it a positive development for buyers.”

“Shannon Jones, a Realtor with Berkshire Hathaway HomeServices agreed it now takes more days and more work to sell a home. Putting out open house flags, beverages and welcoming visitors, including casual looky-loos, is good business. ‘They’re necessary now,’ she said. In March, the average local home sold for $452,400, $4,600 less than a year ago, according to the most recent figures compiled by the Tri-City Association of Realtors. The median was $410,000, down 5% from a year ago.”

The Union Tribune in California. “The lack of inventory was evident in sales numbers, which are still at historic lows. There were 2,541 home sales in March, down from 3,933 at the same time last year. That was the second-lowest sales for any March in records going back to 1988. The lowest was 2,108 in March 2008 during the Great Recession. San Diego County’s median home price rose 5.3 percent in March — reversing nine months of declines — to $790,000, according to CoreLogic. Resale single-family: Median of $880,000 with 1,538 sales, up from $850,000 last month. Down from its peak of $950,000 in April 2022. Resale condo: Median of $650,000, with 813 sales, up from $625,000 last month. Down from its peak of $663,000 in May 2022. Newly built: Median of $801,000 with 151 sales, down from $777,000 last month. This figure combines single-family homes, townhouses and condos. It is down from the peak of $890,500 in August 2022.”

“Here’s a look at the median prices across Southern Californian markets for March: Los Angeles County: Monthly rise of 4.4 percent to $799,000; down 4 percent for the year. Orange County: Monthly rise of 3.6 percent to $990,000; down 2.5 percent for the year. Riverside County: Monthly decrease of 0.8 percent to $535,750; down 4.9 percent for the year.”

The Bakersfield Californian. “Following a volatile start to the year, Bakersfield’s single-family home market returned last month to what a prominent observer termed normal conditions as new data showed the city’s median sale price for an existing house sliding 2.4 percent to hit $370,000, or 1.2 percent less than a year earlier. Local appraiser Gary Crabtree said the median price for a newly built home in March fell more steeply — it was down 6.2 percent month over month at $446,500 — to settle 5.9 percent below its level a year before. As for new construction’s median price change, Crabtree called the decline ‘attributable to the resumption of normal pricing.'”

The Daily Hive in Canada. “Living in the Greater Toronto Area (GTA) doesn’t come cheap. It will now cost you close to $2 million to own the average single-family home in the region, according to the Building Industry and Land Development Association (BILD). BILD reports a steep decline in new home sales in March, when only 1,277 homes were purchased region-wide. That marks a staggering 70% year-over-year decline, falling 65% below the 10-year average for March sales based on data from Altus Group.”

“Condominium apartments accounted for most of the inventory sold in March at just shy of 900 units, down 73% year-over-year and 63% below the 10-year average for the month. Only 384 single-family home sales were recorded last month, a 57% decline from last year and 67% below the 10-year average. Benchmark condo prices also saw a slight increase to almost $1.18 million in March, though that figure marks a year-over-year decline of 10.8%.”

From Newshub. “New Zealand house prices fell by triple figures in the year to March amid ongoing aggressive interest rate hikes from the Reserve Bank (RBNZ), according to Trade Me. Prices fell 10.9 percent ($105,450) in year-on-year terms – the biggest loss on record after February’s 9.2 percent annual decrease, Trade Me’s property price index said. As of March, the average asking price was $866,000. Trade Me said the latest ‘plunge’ suggested the market was continuing to correct itself after COVID-19 caused house prices to surge to record highs.”

“‘When we take a look across the motu, the drops were particularly apparent in the regions which have had the biggest rises over the past few years,’ said Trade Me Property sales director Gavin Lloyd. ‘The Wellington and Auckland property markets have been running red hot post the first COVID lockdown in 2020, so it’s unsurprising that these regions have seen the sharpest drops.’ Trade Me’s figures showed Wellington and Auckland’s house prices dropped by 13 percent in March this year from 2022, while Bay of Plenty was down 11 percent in annual terms.”

Vietnam Investment Review. “Since the beginning of 2022, when Vietnam’s real estate market slid gradually into recession, a number of businesses, from large private firms like Novaland to government-backed companies like Housing and Urban Development Corporation (HUD), are experiencing cash flow and debt repayment difficulties. HUD’s total assets were $427.5 million as of December 31, according to the company’s financial report released on April 10; however, inventory accounted for $237 million, coming from a variety of projects.”

“The situation has become more dire at the end of the first quarter of this year. Dr. Le Xuan Nghia, a member of the National Monetary and Financial Policy Advisory Council, stated last Wednesday that the real estate market will have a direct impact on the quality of bank assets. Currently, investors borrow money from banks to purchase homes, but with mortgage rates at such low levels, Nghia questions their ability to repay bank loans.”

“‘The real estate market plummeted, and the asset quality of the banking system deteriorated, causing problems. The enormous withdrawal of funds from the Saigon Joint Stock Commercial Bank represents a significant threat to the economy, especially if the lack of financial capacity to manage it spreads to numerous other domains,’ Nghia said. ‘The current problem is not only finding a way to recover the market but also preventing major risks to the banking system and financial market.'”

“Nghia added, ‘The enterprises that are currently ailing are those that do not possess a bank account. There are thousands of real estate companies in Vietnam, but only a handful have institutions capable of restructuring poor debts, issuing new loans, and reversing debt.'”

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This Post Has 52 Comments

  1. ‘the latest ‘plunge’ suggested the market was continuing to correct itself after COVID-19 caused house prices to surge to record highs’

    A minor respiratory illness will do that.

    1. after COVID-19 THE GOVERNMENT AND THE FED caused house prices to surge to record highs

      I fixed it.

  2. ‘There is $37 billion worth of securitized multifamily loans set to expire in the next two years where rental income either isn’t enough to cover debt payments, or covers it with less cushion than is considered standard, according to real-estate data firm Trepp LLC. For comparison, that is more than twice the amount of at-risk loans in the office sector’

    Rental airboxes worse off than office? This is the Holy Grail of investing.

    Sacré bleu!

    1. I do RE taxes for private equity and the past few years of deals do not cash flow. Even the ones that do cash flow require a sale of the property at a big profit in order for the fund managers to make decent money off the deals.

  3. “The Tri-City Herald in Washington.”

    This area’s skyline has been dotted with tower cranes constructing multi-family housing buildings for the local working class. The Columbia river separates Kennewick and Pasco, and a few miles upstream is Richland, all of which have become retirement turf for equity locust west-siders looking for a much higher number of days of sunlight for golfing in the area’s country club housing developments. Ample electricity from hydro and nuclear plants, and an endless water supply mean life is good here.

    1. “Ample electricity from hydro and nuclear plants, and an endless water supply mean life is good here.”

      Too bad it’s going/gone socialist.

  4. A reader sent these in:

    Crazy new social credit score tax on housing is leading us to replay of 2008.

    https://twitter.com/WallStreetSilv/status/1649804332785713153

    US National housing market price pattern is eerily similar to late 06 early 07

    https://twitter.com/INArteCarloDoss/status/1650867639164518401

    More bullsh$t banks lending on property flipping get sent to pasture. Good riddance

    https://twitter.com/GRomePow/status/1651019905830129665

    $FRC

    https://twitter.com/Nostre_damus/status/1650898952160694272

    With loan originations collapsing, FHA is trying to offer more and more subprime loans to keep their employees working knowing the taxpayers will bail them out

    https://twitter.com/GRomePow/status/1650938354350034945

    Just in, FHA to allow crack sales from your driveway to count toward income for home purchase and refinances.

    https://twitter.com/GRomePow/status/1650939135484633088

    BACKWARDS 🧵 ALERT! Succinct primer on why $FRC being up to its eyeballs in interest-only mortgages in wealthiest east & west coast enclaves put it in something of a bind.

    https://twitter.com/DiMartinoBooth/status/1650934939246837761

    Remember folks, the GFC wasn’t caused by subprime like they wanted you to believe. It was mom and pop A paper speculators buying too many houses with too much leverage

    https://twitter.com/GRomePow/status/1650930304289492992

    Top Cities with Largest % Increase in listings Week-over-Week (4/16-4/23)

    Brattleboro ⬆️12.9%
    Coeur d’Alene ⬆️ 7.04%
    Austin ⬆️ 4.73%
    Augusta ⬆️4.66%
    Oceanside ⬆️4.62%
    Boston ⬆️4.32%

    https://twitter.com/m3_melody/status/1650923134118158337

    “Says he felt confident taking a negative position against the greenback because of his dim view of US policymaking…”

    https://twitter.com/GoldTelegraph_/status/1650910247765299200

    M2 money supply contracted by -1.2% m/m in March, worst on record

    https://twitter.com/LizAnnSonders/status/1650954540902936586

    Nationwide, homes sold in a median of 43 days in March. That’s compared to 20 days a year earlier. In Boise, homes took 65 days longer to sell than last year. In Austin, they took an extra 45 days.

    https://twitter.com/Redfin/status/1650906682971635726

    3 years ago: 30-yr mortgage rate was 2.97% & average new home price in the US was $360k. Today: 30-yr mortgage rate is 6.39% & average new home price is $562k. Result: $40k increase in down payment (assuming 20% down) & 132% increase in monthly payment (from $1,209 to $2,809).

    https://twitter.com/charliebilello/status/1650885984135921664

    Note: this cost comparison does not include property taxes/insurance/utilities/repairs/maintenance which have all seen significant increases as well. The average US home is unaffordable to the average American and unless mortgage rates plummet, the only solution is lower prices.

    https://twitter.com/charliebilello/status/1650887923783409666

    Average interest rate (APR) on new financed vehicles in Q1 2023 climbed to a whopping 7% — the highest on record since Q1 2008 🥴

    https://twitter.com/GuyDealership/status/1650957291951124510

    No worries. Luxury home prices never fall.
    “Despite being granted to borrowers w/sterling credit, IOs difficult to sell into secondary market, limiting $FRC ability to unload them. By YE 2022 First Republic’s books held ~$58B in IOs mortgages on single-family homes.”

    https://twitter.com/DiMartinoBooth/status/1650888259214385152

    2. “With loan originations collapsing, FHA is trying to offer more and more subprime loans to keep their employees working knowing the taxpayers will bail them out.”

      – The U.S. gooberment 100% intentionally caused this mess, including the Fed as gooberment agency. Apparently the unmitigated disaster of Housing Bubble 1.0 wasn’t enough of a deterrent to Housing Bubble 2.0.
      – Remove gooberment from housing and watch price find its own (much lower) level. Apply the same principle to student loans, and every other normally private sector activity and we’d all be better off.
      – Limited gooberment and free markets vs. Central planning and command and control economics. Think Socialism / Communism. Always fails, and yet here we are.

        1. “The Federal Reserve is neither federal nor a reserve.”

          https://www.hussmanfunds.com/comment/mc230424/
          Fabricated Fairy Tales and Section 2A
          John P. Hussman, Ph.D.
          President, Hussman Investment Trust
          April 2023

          “Investors sometimes imagine that the Federal Reserve is an independent branch of government, and Fed officials encourage this belief with regular talk of Fed “independence.” The fact is that the Federal Reserve is a government agency, regulated by Congress, subject to the provisions of the Federal Reserve Act.”

          “Want to know the Federal Reserve’s actual legal “mandate”? It’s the phrase following the word “shall.” Want to know the Fed’s policy objectives? They follow the phrase “so as to promote.” After the global financial crisis, the 2010 Dodd-Frank Act added an additional objective: to identify and monitor risks to the financial system, through the Fed’s participation on the Financial Stability Oversight Council (FSOC).”

          “Section 2A. Monetary policy objectives”
          “The Board of Governors of the Federal Reserve System and the Federal Open Market Committee shall maintain long run growth of the monetary and credit aggregates commensurate with the economy’s long run potential to increase production, so as to promote effectively the goals of maximum employment, stable prices, and moderate long-term interest rates.”

          “Take a close look at actual mandate – the “shall” – of Section 2A. The Federal Reserve “shall maintain the long run growth of the monetary and credit aggregates commensurate with the economy’s long run potential to increase production.” The Fed doesn’t have a “dual mandate.” It has a single mandate, which it is expected to pursue in a way that effectively promotes several policy goals: maximum employment, stable prices, moderate long-term interest rates, and financial stability.”

          “Over the past decade, the Federal Reserve has wildly abused its “independence,” violating both its 2A mandate and its responsibility for maintaining financial stability, insisting on unprecedented monetary expansion, bringing the ratio of Fed liabilities to both real and nominal GDP to levels never before seen in history, and triggering a decade of yield-seeking speculation that is likely to unwind in tears.”

          – In any case, the Fed has hugely succeeded in enriching the rich and impoverishing the middle class. It’s almost as if that’s their true mandate! They are unelected and unaccountable. Congress does nothing to review progress/achievements towards their “mandate.” I look at the Fed’s actual accomplishments. This is what I see.

    4. welcome back Reader. Missed these. Love these, a must click thru. appreciate the work put into these.

  5. “Note: this cost comparison does not include property taxes/insurance/utilities/repairs/maintenance which have all seen significant increases as well. The average US home is unaffordable to the average American and unless mortgage rates plummet, the only solution is lower prices.”

    – Shacks: Illiquid asset with high carrying costs. And yet we move from housing bubble to bubble. People never learn from history.
    – For example: From paying “over asking”, “love letters”, “feed my squirrels”, “FOMO”, to “aspirational pricing”, “eat my squirrels”.
    – The bottom line: Housing is unaffordable, ever since commoditized and financialized. Once shelter, now a major driver of the eCONomy.
    – BTW, mortgage rates aren’t going to plummet. Therefore, price has to, which is consistent with (yet another) property bubble bursting.

    1. “Therefore, price has to, which is consistent with (yet another) property bubble bursting.”

      First sales will dry up, which is happening now.

      1. Almost everything where I live when listed on places like realtor.com are already listed as contingent. I’ve seen some sitting for 40+ days now.

        A real estate professional told me they have some hidden listings they could show me.

        1. It seems entirely plausible that relitters and sellers work together to maintain off-the-MLS listings that are made available to prospective buyers upon inquiry.

          An inventory glut is a bad look for sellers hoping for top dollar in the offers they receive.

  7. Is First Republic the last bank with short term liabilities and long term loan assets that turned its balance sheet upside down? Or merely the latest to come to light, with many more to come?

    1. The Financial Times
      Opinion Unhedged
      First Republic’s dilemma
      An asset sale is needed, but might be impossible
      Robert Armstrong and Ethan Wu yesterday

      Good morning. On a day when a bunch of huge, important companies reported results for the three months to the end of March — Microsoft, Alphabet, PepsiCo, UPS, McDonald’s — it was the news from First Republic, a bank with a market value of just a few billion dollars, that dominated the headlines. The squeaky wheel gets the grease, and boy oh boy is First Republic squeaky. Let us know what else has your attention: robert.armstrong@ft.com and ethan.wu@ft.com.

      First Republic

      There is a rueful Wall Street joke that goes like this: what is a stock that falls 90 per cent? It’s a stock that falls 80 per cent — and then gets cut in half. The gag is that measuring declines with percentages obscures just how painful those declines can be.

      Yesterday, First Republic illustrated the point. The stock had already lost 86 per cent of its value following the collapse of Silicon Valley Bank in early March. SVB taught everyone how dangerous the combination of uninsured deposits and low-yielding long-duration assets can be, a combination that First Republic has in spades. The bank reported first-quarter results on Monday night, and Tuesday the stock got cut in half. Regulators and financiers are prepping for a rescue.

      On the surface, the shocking thing was the loss of deposits. At $104bn, they were down $72bn from December, and that includes the $30bn in emergency deposits a consortium of 11 banks contributed last month. The bank remains solvent because it was able to replace the lost deposits with borrowing. But the real problem is that the new borrowing is so expensive that First Republic may no longer be able to make a profit.
      …

  8. The Face of Science Dr Fauci reflects in a New York Times Mag article , you can goggle, on the US response to the Covid Pandemic.
    Dr Fauci said in article…

    “Something clearly went wrong,and I don’t know exactly what it was.”

    Ok , so in the article Dr Fauci admits that the US had the greatest amount of Covid deaths of any County in globe, which is a point I brought up last week, if you remember.
    You can read the article yourself , but in summary Fauci attempts to say he never shuts down anything, that it was all Governors, etc .
    So, “Health Authority” is to not be blamed that Governors, Presidents , etc followed their recommendations.
    This is all outrageous no accountability defenses , after the most massive damage in history was done, whereby countless medical experts were were censored and deplatformed and labeled disinformation..

    1. Wrong – Russia, Mexico, Brazil….And others had higher percentage of death than the US. The US was fairly high although we have probably the most unhealthy people of any advanced country in the world.

    2. This U.S. first misstep was failing to deal with China harshly after it was discovered that they allowed airlines to fly all over the planet for several weeks knowing that an unknown lethal virus was being spread.

    3. I don’t buy that 1 million in the US died of COVID, because total deaths barely budged. Once the jab was distributed, THEN total deaths began to rise non-trivially

      1. Dr Fauci at one point said that the Covid response saved 3.5 million lives. Of course there isn’t any truth to the numbers these fraudsters throw around.

  9. Ok, so this is business and housing advise from me.
    I have been researching lately what the WEF has actually said or published.
    They published projections for 2030, that I will attempted to put in summary in my own words.
    The US will no longer rule
    Humans will become vegetarians
    There will be no private property ownership and no privacy for populations
    Health care will be provided for masses
    Shopping as we know it will stop, and needs will be be provided per the rulers
    Huge tax on carbon admissions
    I could go on and on
    and they were not clear on who would be the rulers of this bizarre human existence these private parties, unelected group of fat cat Corporations predict. . We do know they talk slot about Corporate Governance
    and Stakeholders in New World Order..
    . .In a sane World this would be considered projection of Facist/Commie/1984ish insurrectionist take over of World..
    So, based on the above, since these nuts predict no private property ownership by 2030,,wouldn’t buying something they plan to take be a risk ??And the insanity of
    controlled fake news is they don’t think ?of
    ????

    1. Luckily Bed Bath and Beyond is the only corporation that spent a fortune in easy, dumb borrowed money on pumping up its own share price …
      right!?

      1. The $11.8 billion mistake that led to Bed Bath & Beyond’s demise
        Analysis by Chris Isidore, CNN
        Updated 3:26 PM EDT, Wed April 26, 2023
        LOS ANGELES, CA – APRIL 10: Customers carry bags from Bed Bath & Beyond store on April 10, 2013 in Los Angeles, California. The home goods retailer is expected to release fourth-quarter earnings figures after the closing bell. (Photo by Kevork Djansezian/Getty Images)

        New York CNN —

        Bed Bath & Beyond made plenty of mistakes that led to this week’s bankruptcy filing. Among the most consequential was the $11.8 billion it has spent since 2004 to buy back its own shares.

        The company’s repurchase program wasn’t unique. But for a cash-starved business that announced it would likely be forced to close all of its stores if it couldn’t find an 11th-hour savior to buy it, the money could have been better spent. Instead, it fueled a desperate and ultimately failed effort to support its stock price.

        The $11.8 billion Bed Bath & Beyond spent on its own stock since 2004 comes to more than twice the $5.2 billion in debt it had on its books in its most recent SEC filing, a debt load that proved crushing for the company. It left the company unable to buy the inventory required to create the sales it needed to reverse losses.

        “The company’s stewardship of their capital failed,” said Declan Gargan, retail director and credit analyst who follows Bed Bath & Beyond for S&P Global Ratings.
        …
        https://www.cnn.com/2023/04/25/business/bed-bath-beyond-share-repurchases/index.html

        1. Any time I’ve randomly been in a BB&B in the last few years it has been amazingly quiet, like “I’m the only one in here and it’s such a big store” creepy quiet.

    2. MarketWatch
      Home
      Investing
      Market Extra
      ‘I lost $100,000’: investors share Bed Bath & Beyond losses on Reddit after company sold millions of shares ahead of bankruptcy filing
      Last Updated: April 26, 2023 at 4:57 p.m. ET
      First Published: April 26, 2023 at 4:34 p.m. ET
      By Joseph Adinolfi
      As the Nasdaq exchange prepares to delist shares of Bed Bath & Beyond Inc., following the company’s filing for Chapter 11 bankruptcy protection, some retail traders are taking to Reddit to commiserate about their losses, while others say they are doubling down and continuing to buy as the share price sinks further below 25 cents.

      See: Bed Bath & Beyond gets Nasdaq delisting notice following bankruptcy: Here’s what you need to know
      …
      Fed ‘accident’ could slice 20% off the S&P 500, stock market strategist David Rosenberg warns. Here are 3 ways to protect your money now.
      …
      About the Author
      Joseph Adinolfi is a markets reporter at MarketWatch.

  11. Car update: test-drove the VW Golf GTI and not surprisingly liked it. That DSG transmission is better than I remembered it! Now to find the desirable trim and features at MSRP.

    1. From what I saw on cars dot com,VW dealers around here are asking for about $2k over MSRP for the GTI

      Looks like the GTI is assembled in Germany and not in Mexico

      1. A local dealer wants $2900 over MSRP. Another wants $1000. I found dealers that’ll do MSRP. They’re assembled in Germany and Hungary.

    2. “That DSG transmission is better than I remembered it!”

      Yeah, 7-speed dual clutch. There are a couple of YouTube videos that depict its operation in detail.

      I prefer to row through the gears manually, but I don’t live near bumper to bumper traffic either.

      1. The Ford dealer wants 50% over MSRP in this economic environment. The GTI is easily $5K less than the Maverick, more fun, and MUCH nicer.

  13. Housing
    More Bank Failures Ahead, Economist Says
    Vanguard: Home Prices Headed Lower This Year
    The median sales price for existing homes has slid 9% from a record high of $413,800 last June to $375,700 in March.
    Dan Weil
    1 hour ago

    Home prices have been in a slump for the last nine months.

    The median sales price for existing homes has slid 9% from a record high of $413,800 last June to $375,700 in March, according to the National Association of Realtors.

    Soaring mortgage rates were largely responsible, with the 30-year fixed mortgage rate averaging 6.39% in the week through April 20, up from 5.11% a year ago, according to Freddie Mac. That rate increase, of course, stems from the Federal Reserve’s own interest-rate hikes.

    The home-price drop will continue through year-end, Vanguard predicts.

    “U.S. home prices likely will decline 5% on a year-over-year average basis in the second half of 2023,” it said in a report. That’s an “early sign of the lagged economic effects of changing monetary policy,”

    This doesn’t bode well for the economy, Vanguard notes.

    “Since World War II, declines of greater than 10% in the annualized rate of investment in housing construction and improvements have coincided with recession on all but two occasions,” the report said.
    …
    https://www.thestreet.com/housing/vanguard-home-prices-lower-2023

  14. Did you get stucco with a low rate mortgage loan to buy an overpriced house that wouln’t sell today for what you paid for it?

    1. Yahoo
      Get App
      Yahoo Finance
      Homeowners feel trapped by their lower mortgage rate, survey finds
      Gabriella Cruz-Martinez
      Wed, April 26, 2023 at 1:40 PM PDT·3 min read

      Many homeowners who want to sell their homes are opting to forgo those plans this spring because of mortgage rate concerns.

      Approximately 82% of potential move-up buyers said they felt trapped by their current low mortgage rate on their home, a Realtor.com poll of over 1,200 potential sellers in February found. More than half planned to wait until rates fell further before selling, while a quarter planned to sell soon for personal reasons, despite feeling locked in.

      The reluctance of many homeowners to sell this season is exacerbating the inventory shortage of homes for sale, which is propping up home prices as more buyers come into the spring market.

      “The uncertainty regarding the pandemic is past, but today’s homeowners are hesitant because the financial landscape has shifted,” Danielle Hale, chief economist at Realtor.com, told Yahoo Finance. “If mortgage rates remain elevated, it may hamper the recovery in the number of homes for sale. On the flip side, a drop in mortgage rates could improve not only buyer demand, but also housing supply.”
      …
      https://finance.yahoo.com/news/homeowners-feel-trapped-by-their-lower-mortgage-rate-survey-finds-204020709.html

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