So Many Owners Are Still Trying To Sell Like It’s … 2021

A report from the Tampa Bay Times. “You wouldn’t know it from the broken security gate and weather-worn buildings, but at one time, the Grande Oasis condominium in Carrollwood was ‘a garden of Eden,’ said resident Etty Segal. ‘Not anymore.’ Like Adam and Eve, she and about 70 other owners may soon be forced out by a Florida law that gives one company power to seize the entire property. Over time, corporate investors bought up more and more units to lease as apartments. One real estate firm, West Shore, now owns more than 90% of the property’s 1,000 units. The company has complete control of the condo board and a clear path to terminate the community’s existence as a condominium to become the sole owner. ‘Everybody that hears about this says ‘they can’t do that to you, you’re the owner,’ Segal said. ‘But for some reason it’s allowed.'”

“Investors are eager to buy and redevelop these struggling properties, many of which are on prime pieces of land in hot neighborhoods or coastal communities. But owners who want to stay are left with little recourse if they are outnumbered. Segal said if she loses her home she won’t be able to find a new one in her budget. Her fate may hinge on an ongoing legal battle out of Miami, where a small group of owners at the Biscayne 21 condo claim that a developer unlawfully terminated their condo association. Resident Doreen Rosselli paid $183,300 for a two-bedroom unit there in 2006. State law would require West Shore to offer her a fair market price if she’s forced to sell. But she said she doesn’t make enough to afford anything else in the area, which has gotten considerably more expensive since she moved there. ‘Why should I be financially burdened just for someone who’s rich to get richer?’ she said.”

The Sun Sentinel. “In the wake of hurricanes Helene and Milton, Florida’s housing crisis has continued to intensify — and may have reached a boiling point. The state’s older condo buildings, many constructed during Florida’s real estate booms decades ago, now face structural issues exacerbated by hurricanes and new safety regulations. This has placed an enormous financial burden on condo owners, many of whom are elderly and on fixed incomes. The resale market for these older buildings has stalled. This decline in the resale market means a flood of unsellable properties, creating an affordability crisis for long-standing communities. Coastal buildings are more vulnerable still. Particularly susceptible to storm damage, they are now viewed as financial liabilities. In many cases, the land these buildings sit on is worth more than the structures themselves, making them prime targets for developers. Without swift action, the combination of rising insurance costs, unsustainable assessments and the impact of hurricanes could lead to a mass exodus of residents and the continued erosion of affordable housing in the state.”

The Idaho Press. “Two planned residential housing facilities will no longer be part of downtown Boise’s future. Capital City Development Corporation (CCDC) moved to terminate contract agreements for a mixed-use housing development next to the new YMCA and a workforce housing project on an adjacent block in a board meeting earlier this month. ‘The market and time were not on our side,’ Dean Papé, partner at deChase Miksis, said in the November board meeting. ‘We all understand there’s a timeline that (we) need to complete the projects within and the market conditions drastically changed throughout the course of the project.'”

Realtor.com on California. “Kylie Jenner and Travis Scott have removed their Beverly Hills mansion from the market after spending two years trying (and failing) to sell the expansive property. The on-again, off-again couple, who share two children, initially listed the seven-bedroom, 8.5-bathroom home for $21.9 million in 2022, around the same time they split for a second time. Having purchased the home for $13.4 million in 2018, one year into their tumultuous relationship, Jenner, 27, and Scott, 33, stood to make a hefty profit on the sale—had they been able to find anyone willing to pay their sky-high asking price. Instead, the duo faced nothing but real estate agony as they repeatedly lowered the price of the property, only to face the same difficulty in finding a potential buyer.”

“In March 2023, they discounted the home to just under $20 million, then discounted the mansion again in February 2024 to $17,995,000. Months later, they dropped the ask again—this time to $15,995,000. Now, the listing has been removed altogether. The couple faced difficulties in selling the home from the get-go, with luxury real estate broker Arvin Haddad telling Realtor.com® in March that the couple had been too ambitious with their initial asking price. ‘They bought it for $13.5 million and have done some work to it, but even $13.5 million was a high number for that property,’ he said. ‘Kylie tends to overpay for everything she buys, but she didn’t get a good deal on the house.'”

The Real Deal. “Nathan Hochman’s campaign had been in celebration mode all day. The former federal prosecutor was about to unseat Los Angeles County District Attorney George Gascón, and anyone invested in real estate in the county was popping the champagne. Gerald Marcil, Hochman’s biggest donor, and the founder and CEO of multifamily firm Palos Verdes Investments, preferred beer. He’s afraid California is on the wrong track. ‘No neighborhood is safe anymore,’ he said. ‘My tenants are not living in bad areas, but they’ve become bad.’ That voters elected Hochman, agreeing with at least the spirit of his declaration, seemed like an overnight about-face from the election of progressive Gascón four years earlier, especially since Californians also rejected another progressive priority — reopening the discussion on rent control.”

“Marcil was particularly incensed when a man who had been caught and imprisoned for attempted arson at one of his apartment buildings in Harbor City was released early. ‘I think he got four years,’ he said. ‘But about 10 months later I got a call. ‘We got to let you know something. There’s this new D.A in town. His name is Gascón, and he let your guy out,’ he recalled. ‘I have to tell my manager to keep an eye out. It’s scary.’ Like most in the industry, Marcil views rent control as a cosmetic fix that does nothing to address the anti-development syndrome at the root of California’s housing crisis. It’s just another piece of evidence backing one of his most firmly held beliefs, namely: ‘The government is massively stupid.'”

WCVB in Massachusetts. “Fewer and fewer people have been gathering at Mass and Cass since the City of Boston took down tents and banned camping on public property. Now, new concerns about drug use and crime are making their way into other parts of Boston. Mayor Michelle Wu has said Boston is the safest major city in the United States. However, a stabbing months ago in Downtown Crossing prompted City Councilor Ed Flynn to hold a hearing on crime last week. One mother testified that in her diaper bag, she keeps a box for collecting needles that she walks by. ‘I pass discarded needles regularly as i walk my five year old to public school everyday,’ she said.”

From Bisnow. “When Americans rushed out of large coastal cities like New York and Los Angeles, they found a pandemic haven in suburbs, small towns and the Sun Belt. Developers followed, with the largest multifamily REITs betting that land from Florida to Arizona would surge in attraction and value. Cranes rose across the South, as developers expected demand to hold steady or grow just as projects were delivered. Now, those markets face a major glut. Rents were down roughly 2% year-over-year in the Sun Belt in the third quarter, with Austin rents 8% lower than they were in the prior year and Jacksonville rents down 5%, according to CBRE. ‘[We are] in the midst of clearly record levels of new supply coming into our market,’ Memphis, Tennessee-based Mid-America Apartment Communities CEO Eric Bolton said during a second-quarter conference call. ‘And we feel like we’re in the worst of the storm right now.'”

The Globe and Mail in Canada. “The recent U.S. election, in particular, was jarring. Before the November vote, economists generally agreed that the country was in robust shape, with strong investment, steady growth and rising real wages. Then, shortly before Americans headed to the polls, the Federal Reserve declared victory over the previous two years’ inflation and cut interest rates to further stimulate the economy. If there was a moment for the economics profession to take a victory lap, this was it. But millions of Americans, especially those who voted for Donald Trump, didn’t believe a word of it. Survey after survey reported they thought the economy was in bad shape and inflation rampant.”

“This is a ‘vibecession,’ a term coined to describe the odd discrepancy between objective and subjective evaluations of the economy, and which has now been used by Finance Minister Chrystia Freeland to account for the similar gloom of Canadians. Eggs are still seven times more expensive than they were when Joe Biden took office, which is why this example kept cropping up in vox pop interviews of Americans who said things were better under Mr. Trump. Then there’s asset prices. Most models don’t factor them into inflation measures on the grounds they’re outside the real economy. Thus central banks allowed house prices to rise to the moon by pointing to the fact consumer prices remained dormant. While that was great for owners, the effect on renters or prospective buyers, particularly young working people, was terrible. That, in turn, may explain a surprising trend in recent elections.”

“Whereas older voters have tended to stick with establishment parties, younger voters have been shifting to populists on the right – and strongly toward Donald Trump in November’s election – with the cost of housing often weighing on their decisions. We’re seeing a similar generational split in Canada, where traditionally left-leaning young voters are moving toward the Conservatives.”

The Cornish Times in the UK. “Cornwall councillors have been extremely critical of the local authority’s arm’s length building company Treveth. One said the house-building entity would be declared insolvent if it was a ‘normal’ company, while another said the council would be better off buying houses and ‘getting rid of Treveth.’ Cllr Steve Arthur (Non-aligned, Perranporth) entered the debate, expressing “serious concerns” about Treveth. ‘If you look at the money we’re putting into it, if our ambition is to get more people out of the housing register, we’d be better off going out and buying houses off the shelf and just getting rid of Treveth. I think we are a bank, we do have shareholders and they are council tax payers. This council is getting into debt faster and faster, and we’re just featherbedding a company which isn’t providing the houses that it should.'”

From Domain News. “‘Dear Vendors,’ the nation’s buyers are all saying in what could be seen to be a heartfelt love letter to the country’s vendors. ‘We love your property, we’d love to buy it, but not at any price. Please be realistic, and we can have a relationship. If you don’t, you could be stuck on your lonesome for a long, long time.’ In the run-up to Christmas, it’s a plea that’s being echoed by agents across Australia. At a time of a near-record surge in listing – up by as much as 35 per cent this year – so many owners are still trying to sell like it’s … 2021.”

“‘But it’s nothing like the boom market we’ve had just a couple of years ago,’ said Dionne Wilson of Harcourts Melbourne City. ‘Even really good quality blue-chip stock has come back in price. Yet a lot of owners still think they are going to get top prices which isn’t at all likely. There’s a lot of listings and buyers are more cautious, so prices are softer. We’ve having some very firm conversations with vendors to explain the conditions before they set their sights too high.'”

“The trouble is, some agents are telling vendors what they want to hear and putting too big a price on their properties to lure them in, says Wilson. Then they pay for the advertising and marketing campaign … and don’t get a sale. ‘The trouble is, some agents are telling vendors what they want to hear and putting too big a price on their properties to lure them in,’ says Wilson. ‘Then they pay for the advertising and marketing campaign … and don’t get a sale.'”

“Ewan Morton of the eponymous agency said, ‘We have had a problem with vendor expectations being above the market. We do say that when the market starts to turn, vendors are the last to understand there’s been a change. It would seem some suburbs are seeing reductions, so the expectation of a weaker market is being met. As a vendor, you can still get a good outcome, but you need to approach the market correctly and pitch your property at a price where people can see value.'”