The Fantastical Pricing Of A Few Years Ago Will Not Work In This Market

A report from the Daily Mail on California. “Wendy Fry, a reporter with Mercury News, said Tuesday was the quintessential beach day in San Diego, where the affluent towns of La Jolla and Del Mar are located. While the beaches were packed, Fry said the coastline was eerily deserted. The culprit? Over 100 billion gallons of raw sewage from Mexico’s Tijuana River, dumped into the Pacific Ocean over the past five years. This untreated sewage has become a recurring nightmare for Imperial Beach, a small coastal town of about 26,000 residents. ‘(The smell) wakes you up in the night. That’s how strong it is,’ said Cara Knapp, who lives on the oceanfront Seacoast Drive with the beach as her backyard. ‘They call us ‘the stinkiest beach.’ Who wants to buy a home – a million dollars and up – and be considered ‘the stinkiest beach in the United States?'”

San Jose Spotlight in California. “For May, housing inventory is up 8% year over year, according to Dave Walsh, vice president at Compass. ‘Buyers have been waiting for their opportunity to have multiple choices on available properties. This is their time,’ he said. Not surprisingly, the number of sales also rose to nearly 7.5%. What’s a little surprising is the sheer number of price reductions in May, 52%. Walsh explains this is unusual for the heart of the spring selling season. ‘Many sellers are expressing a willingness to work with buyers to get a deal done now, whereas, for the previous five months of the spring selling season, they had not been as willing to negotiate,’ he said.”

“Mary Ann Brown D’Antonio with Sereno Real Estate had a referral for a Veterans Affairs buyer in April with a max price of $1.3 million, but was concerned she wouldn’t be able to find them a single-family home in Santa Clara County. ‘At that time, the market was showing signs that it might be slightly shifting, and more inventory was starting to come on,’ she said. ‘On June 15, I was able to get my client into a contract on a single-family home in Morgan Hill, $50,000 under list price with contingencies. This is a deal that I don’t think would have existed a few months ago.'”

Hawaii Public Radio. “Maui has the highest activity for listed short-term rentals in the state. The industry brings jobs and tax revenue — but also contributes to the housing crisis. Maui Mayor Richard Bissen has proposed an ordinance that would phase out about half of Maui’s nearly 14,000 vacation rental units in apartment-zoned districts built before 1989, also known as the Minatoya List. Andrew Church, said all his family’s income comes from management and rentals of Minatoya List properties. ‘The passage of the county’s proposed legislation to ban short-term rentals will be financially catastrophic and a final blow for my family,’ he said. ‘This proposed ban will bankrupt my family. Since May 3, when the mayor gave his press conference, we have not had a chance to sleep.'”

Queen City News in North Carolina. “The only thing I could hear on Furnace Road Extension this April morning was the wind whipping the house wrap outside of Lisandra Flores’ unfinished home. The opening where the two-car garage door was supposed to go was a gaping opening, showing off the framing job inside. There wasn’t a single piece of drywall screwed to any of the wall studs. After $189,000 in bank draws from their construction-to-perm loan, Flores said the work stopped. The loan became a permanent mortgage after the construction completion deadline passed. Although the house was never finished, the Flores family’s made mortgage payments on the $189,000 loan for the past three years. A home they can’t live in.”

“‘Nothing had been done,’ Labelle told Queen City News Chief Investigative Reporter Jody Barr. ‘Kept driving to the lot on the weekends, nothing’s going on. Nothing’s happening. I’m finding this strange and I’m driving out there and I’m never seeing any type of work being done on any of the houses. And that was a red flag. Why am I not? I see all these half-built houses, why do I never see tradesmen?'”

Detroit Free Press in Michigan. “Randee Noggle has one wish — for her family to be able to stay in their home. On Thursday, a federal judge ordered that to be the case — for now — for the Noggle family, of Taylor, and several other metro Detroiters who filed a civil lawsuit against a New York company, alleging it lured them into deceptive sale and leaseback transactions of their homes. The seven plaintiffs allege they ‘rent’ their homes from the company with monthly payments they can’t afford. They’ve fallen behind on their rent and face risk of eviction, according to filings this week in U.S. District Court in Detroit.”

“The plaintiffs owned their homes outright, per court filings, but faced financial distress that caused them to borrow cash in a loan secured by home equity. They found EasyKnock online and a “Sell & Stay” option that their attorneys allege is ‘an inflexible debt trap that stripped Plaintiffs of the equity in their homes, exposed them to high-interest rates disguised as fees and ‘rent,’ and unlawfully circumvented federal requirements to evaluate a consumer’s capacity to repay a loan before securing a transaction with their home’s equity.’ ‘This is just ridiculous. I mean what we pay a month (in rent) is what I get in disability,’ said Randee Noggle, 33, who, with her husband, 46, a restaurant cook, has a 6-year-old son with special needs. ‘I just wanna be able to stay in my home because that was the whole reason behind this was to stay in my home. And even with agreeing with EasyKnock, it was to regain my home back by these payments, not for payments to keep going up and up and then each year the prices to buy back goes higher.'”

NBC 2 in Florida. “A group of condo owners say their condo association is forcing them to live in unhealthy conditions after Hurricane Ian destroyed their homes. The conditions are so bad many of the residents can’t live in their homes. Seven residents who live on the third floor of the Berkshire Condos, just off of Barkeley Lane in Fort Myers, say they’ve been forced to live in horrendous conditions Ian struck. Cynthia Ruke had just installed a new carpet and had the walls of her condo painted just before Ian struck, and she was ready to move in. Then Ian ripped the roof of the condo off. Her condo and six others on the third floor were gutted. ‘They’re living in open rafters and cement floors,’ Ruke said.”

“Other residents on the third floor also have gutted condos, and while most can’t live in them, Charles Silas has no choice. He walks on cement floors and runs his air conditioning despite the fact that he has no ceiling or insulation above him. ‘It is like camping. That’s a good analysis. I just like roughing it,’ Silas said. He points out, though, that camping trips only last the weekend. ‘Well, it looks like I’m in for the long haul,’ he said.”

My Northwest in Washington. “Despite protestations by progressives that conservatives are overstating the despair of downtown Seattle, the neighborhood is dying, but on life support. Walk downtown and you’ll see a neighborhood that is quickly returning to the hellscape it became during COVID-19. Too bad neither the media, nor the people in charge, seem willing to admit the truth about what’s happening as the downtown Seattle real estate market collapses. Last week, reports in The Seattle Times painted grim pictures of the commercial and residential real estate market in downtown Seattle. One article pointed to astonishingly low price tags for previously pricey commercial buildings, including the near-empty Pacific Place Mall and the Downtown Hilton. A second article noted the price of homes downtown is trending lower than the costs citywide.”

“Commercial real estate is selling at deep discounts because the spaces are empty. Whether it’s a mall that has few operating stores, boarded-up restaurants and clothing stores or empty hotel rooms, if you don’t have foot traffic and visitors, the land loses its value. Why are these spaces empty? It’s not safe to shop in the area with homeless criminals, it’s not appetizing to eat a meal next to a passed-out fentanyl addict who soiled himself and no one wants to visit a downtown core that’s become such a blight.”

The Arizona Republic. “Metro Phoenix’s median home price was flat in May and is expected to dip in June. The median home price was $450,000 in May, the same as it was in April, according to the Arizona Regional Multiple Listing Service. The Phoenix-area median is expected to inch down to $445,000 in June. ‘Sellers are nervous, and buyers are unenthusiastic,’ said Mike Orr, founder of The Cromford Report, about the housing market. Metro Phoenix home sales reached 7,386 in May, up from 6,859 in June. Total listings climbed by about 1,000 last month to 17,897. ‘Our housing market is transitioning from our peak season to our offseason,’ said housing analyst Tom Ruff with The Information Market, a division of ARMLS. ‘It’s beginning to look like we’ll be in this rut for a while.'”

“What could also spur some buyers is more sellers offering concessions. During June, 55% of Phoenix-area home sales sold with seller concessions, said Tina Tamboer, senior analyst with Cromford. That’s up from 49% a year ago. The median incentive is $9,400, up $1,200 from a year ago, according to Cromford.”

Colorado Springs Gazette. “Many people have asked me about the plethora of new apartments in our region and if we’ve overbuilt. Most people have heard about the national and regional housing shortage, but they still wonder if we’ve overbuilt apartments and whether vacancy rates are going up. The answer is nuanced. It is true that our region has a shortage of roughly 8,500 housing units, which includes both multifamily apartments and single-family homes. It is also true that we had an absolute boom in multifamily construction during the pandemic. A high number of permits were pulled, initiating an unprecedented number of new apartment projects. Most projects take a minimum of two to three years to complete, so we are now facing an absorption problem with many of those apartment buildings finished, creating a glut of new product.”

Mansion Global. “This month the Bank of Canada cut interest rates for the first time in four years―fueling some optimism among both home buyers and sellers and stoking the sluggish market in Toronto. But sellers who hope to cash in on an energized buyer pool will face a very different market than the 2021-22 boom, when ultra-low rates turbocharged sales. At the time, nine in 10 homes received multiple offers ‘because buyers were desperate’ and feared prices would keep soaring, according to Canadian property site MoveSmartly. Now, sellers must market homes much more strategically to win over choosier prospects.”

“‘There is a big pool of buyers ready to get back into the market,’ said Don Kottick, CEO of Sotheby’s International Realty Canada. ‘But they’re more discerning now, taking time to find properties with all of the amenities they require and not overpaying.’ Buyers are not feeling the pressure of missing out as they did two years ago, said Paul Johnston of Paul Johnston Unique Homes/Right At Home Realty in Toronto. ‘The fantastical pricing of a few years ago will not work in this market. People are analyzing what they’re looking at. For sellers, that means a key differentiator is the sophistication of their marketing.'”

CTV News in Canada. “Investors who collectively lost millions in a real estate scheme will soon be getting a small portion of their money back, according to the B.C. Securities Commission. The provincial financial markets regulator said in a news release Thursday that $2.1 million recovered from Siu Mui ‘Debbie’ Wong and Siu Kon ‘Bonnie’ Soo would be distributed to 92 investors who lost money in the sisters’ fraud. According to court-appointed receiver MNP Ltd., victims of the fraud claim to have lost a combined total of roughly $33 million. Wong and Soo were permanently banned from the financial markets and ordered to pay a total of $22 million in penalties after a BCSC panel ruled on their case in 2016. The penalties against the sisters stem from the acquisition of various tracts of land for development in Alberta, and the sale of shares in those development projects to investors.”

“The BCSC panel found that Wong and Soo committed fraud by misappropriating $1.2 million of investors’ funds, transferring shares to their husbands and adult children without receiving payment in return, ‘inflating the purchase price of a property and lying about it to investors’ and ‘using mortgage proceeds for purposes other than developing the property.’ The BCSC obtained a freeze order for some of Wong and Soo’s assets during its investigation, and it was the sale of those assets by MNP that generated the bulk of the $2.1 million that will now be returned to investors, the regulator said.”

ABC News in Australia. “Concerns over defect-ridden buildings have prompted the New South Wales Building Commission to expand its presence beyond Sydney, starting with a permanent office in the Illawarra. Assistant Building Commissioner Matt Press said it was important the Illawarra was selected as the first regional office. ‘Unfortunately, the reality is we have seen some shocking projects here,’ Mr Press said. ‘Projects on Young Street and Crownview, they have really put a stain on industry and really hurt its pride.’ For three years, the 149-unit Crownview complex has remained unoccupied, with Building Commissioner David Chandler identifying serious structural defects. Recently the Commission has had success in securing the return of deposits for people who bought off the plan.”

“Wollongong’s Lord Mayor, Gordon Bradbery, said the increasing number of building faults is directly linked to the growth of private certifiers. ‘We wouldn’t be in this situation if the private certifiers had been more strictly regulated and we had more control over building development,’ Cr Bradbery said.”

From The Sun. “Lapping up the Magaluf sunshine, holiday-maker Zoe Kemp dismissed the anti-tourism demonstrations which are sweeping the Costas as ‘completely hypocritical.’ ‘They rely on tourists to survive. If you look around, everything is based on tourists,’ she told The Sun. ‘Places like Magaluf are advertised as cheap drinking holidays. We help the economy.’ The resort lies on the west coast of Majorca, in Spain, which receives around 40 per cent of its income from tourism. Yet in May 15,000 people stormed through the island’s capital Palma jeering at visitors as they sat down for meals. Stickers have been plastered around the island, reading: ‘More tourists? No thanks,’ ‘Stop Tourism’ and ‘Tourist go home — you are not welcome here.'”

“The wider anti-tourism demos, from the Spanish mainland to the Balearic and Canary Islands, threaten a summer of chaos for British holidaymakers. Alícia Aguiló, spokeswoman for SOS Residents, an activist group co-ordinating rallies in Majorca, told The Sun the movement is spreading rapidly across Spain. She said: ‘They started in the Canaries. Now I see that in Ibiza they are beginning to mobilise. ‘This is just the beginning. We will continue until politicians are willing to make changes. Majorca is being colonised by foreigners and greedy developers have turned the islands into a theme park for tourists. Our children have no chance of becoming independent, because rental prices are far above their means, even if they have an average salary. We are becoming poor workers without services. We can’t allow the greed of some to condemn our children to emigrate to have a decent life. The roads, beaches, bars and hospitals are saturated.'”

“Palma resident José Mercader, 52, was compelled to support the protests – despite relying on the tourism industry in his job as an airport baggage handler. He said: ‘I think the protests will get bigger and spread across Spain. There are problems elsewhere that are even bigger than here. It’s impossible to buy a house and to rent is really expensive. My mother has just one Majorcan neighbour, everyone else is from other countries. Before the tourists, everyone on the island had a house and land. Maybe the work was harder but Majorcans had all the basics. Life without tourists would not be hell.’ José said locals are also tired of ‘rude’ Brits, adding: ‘They say good manners are born in the UK but it’s like they forgot it. People come here with their noses in the air.'”

“Property prices in Majorca have more than doubled in ten years. On Thursday, estate agent Adela Kovacs showed clients around a three-bedroom flat in central Palma which is valued at €4.9 million ($A7.9 million). She said the agency has had interest from England, Germany, Sweden and Russia but not Majorca, as ‘we could never in our life afford to buy anything like this.’ Welsh-born Rhiannon Lewis, 41, who emigrated to the island five years ago with partner George Rees, 40, said: ‘There are families that have lived here for generations and they can’t get on the property ladder. It’s not fair. I think they will keep protesting until the government does something. If people can’t keep a roof over their heads, they’re not just going to give up.'”