From Buydowns, Buydowns, Buydowns To OK—Wait A Second Here

A report from WWAY in North Carolina. “After Tropical Storm Debby two months ago, Jeff Wells and Jana Passe discovered water leaking from the roof into their condo at Topsail Dunes Villas on New River Inlet Road. The HOA told the couple the roof was patched, but water continued to leak into their condo. ‘The HOA told the couple their homeowner’s insurance—not the HOA’s—would need to cover the roof repairs, despite roof maintenance being the HOA’s responsibility. ‘They were trying to pawn it off on us,’ Wells said. After the HOA filed with their insurance, the claim was denied due to lack of maintenance on the roof. The HOA appealed the decision, but the claim was met with another denial. Wells and Passe said the HOA then refused to repair the roof unless the couple takes them to court, a move that Wells thinks is calculated.”

“‘They’re hoping that we’re going to run out of money, or they’re going to make us so miserable that we’ll just walk away. Who can walk away from $300,000? That’s our life’s investment,’ Wells explained. ‘Even if we had money, and we decided to foot the bill and renovate it, we can’t because there’s still water coming in and nobody is doing anything about it,’ Passe added. Wells and Passe said their condo is currently unlivable because of toxic mold. They were told the condo will need to be gutted from floor to ceiling to make it safe again. ‘We’ve paid out of pocket our entire life savings and then we started selling stuff that really, we just had to come up with cash. You shouldn’t have to live like this,’ Wells said.”

From NBC News. “Bridgette Bello thought she’d taken proper precautions to protect against Florida’s notorious hurricanes, having purchased flood insurance as well as a separate hurricane-specific policy, in addition to her regular homeowners coverage. Yet nearly two weeks after Helene hit — and even before Milton had arrived — what Bello, 54, describes as an insurance ‘nightmare’ has only begun. She said she already faces delays and denials on her damage claims. ‘We did everything we were supposed to do,’ said Bello, who lives near the barrier-island Madeira Beach community outside of Tampa.”

“Patti Drew’s home in Punta Gorda, on Florida’s southwest coast, flooded during both Helene and Milton. Her daughter-in-law, Deborah, said Drew, 81, didn’t even have regular homeowners insurance — a decision she shares with approximately 1 in 6 residents in surrounding Charlotte County. With only a fixed income to live on, Drew is hoping a GoFundMe page that Deborah has set up will provide some relief. ‘I’m heartbroken. I don’t know what else to say,’ said Drew. ‘I mean, we can’t do anything about it.'”

Fast Company. “Among the nation’s 250 largest metro areas, 57 markets had active housing inventory in September 2024 that was higher than in September 2019. Of those 57 markets, 41 have seen home prices fall at least somewhat since their 2022 peak. Despite Austin’s months of housing inventory only reaching a high of 4.8 as of August 2024, house prices have already dropped by 19.8% from their 2022 peak in Austin.”

Dallas Morning News in Texas. “Dallas-Fort Worth home builders reported a slightly slower third quarter this year. Finished vacant housing inventory moved higher last quarter, reaching a cycle high of 10,269. That’s year-over-year growth of more than 2,000 units, a 24.7% increase. ‘Without question, the increase of finished, unsold inventory is directly correlated to the increased competition and challenging affordability issues in the market,’ said Cassie Gibson, executive vice president at Residential Strategies. ‘Builders are focused today on closing out unsold inventory to make room for new inventory in the spring of 2025. In this environment, builders are dealing with tighter profit margins due to the increasing need for discounts and incentives.'”

Wall Street Journal. “Home builders might have to turn to other strategies in addition to buydowns, such as further price reductions, said Rick Palacios Jr., director of research at John Burns Research & Consulting. ‘The playbook for home builders is going to have to slowly shift, at least from our perspective, from buydowns, buydowns, buydowns to OK—wait a second here,’ he said. ‘It’s going to be a tougher market.’ Around three-quarters of builders recently used rate buydowns that covered entire 30-year mortgages, according to a September survey conducted by John Burns. ‘I’d call it a time of transition,’ said Tom Hennessy, CEO at Colorado Springs, Colo.-based Challenger Homes, which has leaned on rate buydowns in recent years.”

From Fox 5. “Daniel Snyder, former owner of the Washington Commanders, is facing challenges selling two of his multimillion-dollar estates in the D.C. area. A new report in The Washington Post states that despite a thriving ultra-luxury real estate market, neither property has attracted buyers. However, after repeated price cuts, the Potomac mansion remains unsold. In March, the Snyders donated the property at 11900 River Road to the American Cancer Society. In May, the charity relisted the home for $34.9 million, yet no buyers emerged. By September 23, the price was reduced again to $29.9 million. Snyder’s Fairfax County property, located on part of George Washington’s original Mt. Vernon estate, remains on the market for $60 million, but its steep price, at over $3,700 per square foot, has also deterred buyers.”

San Francisco Chronicle. “Humboldt County, with its mountain peaks, cannabis and redwood trees, can feel like a fog-shrouded oasis in California. That reputation prompted the LA Times to crown the two cities the best places to retire in the state. Ted Pease, the editor of Senior News, a monthly newspaper published by the Humboldt Senior Resource Center, agreed, telling SFGATE that framing Humboldt County as a ‘retirement oasis’ is majorly flawed because ‘health care here is extremely problematic.’ Despite the county’s four hospitals, Pease said, ‘almost everyone has to travel to the Bay Area for medical treatment,’ which is a five-hour drive at minimum, given the need to travel through the Coast Ranges. Marci Pigg, who’s worked with her husband as a real estate agent in the Humboldt County area for nearly 30 years said the average home on the Eureka and Arcata market requires the income of two working adults, which for locals can prove challenging in the county’s economic environment. ‘The cannabis industry has pretty much dried up. You don’t see many logging trucks anymore,’ Pigg noted.”

The Real Deal on New York. “Rupert Murdoch’s penthouse at One Madison has finally found a buyer. The 7,000-square-foot abode at 23 East 22nd Street entered contract last week with a last asking price of $29 million, according to Olshan Realty’s weekly report on properties asking $4 million or more. The move comes after the asking price hovered roughly $15 million below what he paid for it in 2014. The media magnate’s triplex has drifted on and off the market since March 2022, when he listed it for $62 million. Of the 28 contracts, 19 were for condos, six were for co-ops and three were for townhouses. The homes’ combined asking price was $307 million, which works out to an average price of $11 million and a median of $10 million. The typical home spent 469 days on the market and received a 17 percent discount.”

The Hamilton Spectator in Canada. “The residents of the Court Drive subdivision of Paris are angry. Like their neighbours at the Mile Hill subdivision down the road, they say they were blindsided over three condo developments proposed between the two neighbourhoods. ‘And the community blew up at that because they didn’t want their 10-year-old riding a bus for an hour and a half,’ Cameron Stone told The Spectator. Stone and his wife bought one of the first new builds in the Mile Hill subdivision through a small developer in 2018. Their developer and others ended up selling to Hamilton’s Losani Homes, which was also building homes in the area. Now, it feels like ‘the big city developer coming in and bullying the small town,’ he said. Residents like Pavinder Tut, who bought in Court Drive two years ago, said they were misinformed over what their neighbourhood would look like. ‘Homeowners were sold on the notion of this private, ravine-facing lot. For us, this was done in poor faith,’ Tut told councillors.”

The Telegraph in the UK. “When Ian Cooper invested in his first buy-to-let property it seemed like a solid, safe way of funding his retirement. Twelve years on he ruefully admits that the experiment has failed. ‘I would have been better off if I had just put the money in an Isa,’ he says. Cooper and his wife currently own two rental houses close to their home in Beeston, Nottingham. They are also the accidental landlords of their former family home in nearby Wollaton, which they have rented out since earlier this year after failing to find a buyer for it. Over the summer, landlords across the country have been voting with their feet and putting their rental properties on the market.”

“For Ryan Mitchell, the prospect of a hike in CGT was the cherry on the cake that ended his career as an accidental landlord. Things started to go wrong after a new tenant, having split up with their partner, stopped paying the £675 per month rent. The neighbours complained about their erratic behaviour, the property was being damaged, and eventually he launched eviction proceedings. He reclaimed the property at the end of last year, and with the prospect of higher CGT on the horizon, decided to sell up. ‘Even before the election the writing was on the wall,’ says Mitchell. ‘The finances of the country are poor, there is going to need to be a tax raid somewhere, and the Government is not going to lose many voters by attacking landlords.'”

From IOL. “South Africans are enduring the effects of a sustained period of rising costs and increased debt payments which in turn have put them under severe financial pressure, for many homeowners, this pressure has seen them being unable to keep up with their monthly home loan repayments. ‘It’s not just entry level homeowners that are struggling to balance the increased cost of debt in the current environment,’ said Herschel Jawitz, CEO of Jawitz Properties. ‘We’ve increasingly listed homes to be sold by distressed sellers in more affluent areas which have typically been immune to this kind of repayment shock. Property prices in most parts of the country are under pressure, which means it’s not a great time to sell if you are under pressure to sell in a short period of time.'”

Yahoo News on Australia. “A tradie who inspects housing sites for a living has lifted the lid on the ‘wild west’ practices that he claims are common within the construction industry, saying the issue is a ‘can of worms’ that homeowners unknowingly take the brunt of. Building inspector Russell McCarthy attended a housing site in Perth last week for an independent inspection and found the primary beam at the centre of the house frame had absolutely no fixings to secure it. Instead, it was simply placed against the brickwork while it supported many struts jutting out to make the roof. And, the entire frame itself was also off-centre. In the past five years, McCarthy said he has not inspected one new build that was ‘defect-free’ — despite it being a part of his everyday job.”

“This lack of compliance has given rise to ‘shoddy workmanship’ that can sting homeowners down the track, as most insurance companies don’t cover the dodgy work of tradesmen. ‘In the case where it’s identified, insurance will walk away every single time as they don’t cover non-compliant work,’ he said. ‘Clients don’t trust builders and it’s fair enough.'”

From Bloomberg. “China’s latest bout of stimulus may help stabilize the country’s property crisis but investors should position for the end of the economy’s boom years, says the investment chief of Australia’s largest pension fund. ‘The big boom times in China growth are gone,’ Mark Delaney, Chief Investment Officer of AustralianSuper, which manages more than A$341 billion ($229 billion), said at a Bloomberg event in Sydney on Tuesday. ‘The authorities have been really k”een to try and keep house prices steady,” Delaney said. The support measures are about trying to ensure the property slump ‘doesn’t feed back heavily into consumer spending and start that negative cycle you’ve seen in other housing busts.'”

“Housing slumps in other countries have taken ‘decades to work their way through,’ Delaney said, citing AustralianSuper analysis of crises with similar characteristics, such as Japan in the 1990s. ‘Governments all try and stabilize it, but you need to really work off the structural oversupply,’ he said. ‘So I think that’s really going to be a pretty pronounced impact upon China.'”