You Just Need To Take The Loss If You’re Selling And Move On

A report from Tampa Bay News 9. “Florida’s ever-changing real estate market is currently experiencing a shake up: There is more inventory, meaning more homes for sale, but fewer motivated buyers. A real estate agent said this is a bit misleading, in that increased inventory isn’t exactly a bad thing. Melanie Atkinson, an agent with Compass Realty, said the real cause of the increase in inventory is the condo market. She says no one is buying them and inventory is piling up because requirements imposed by the state. The costs now associated with owning a condo have nearly doubled. She says there are about 22,000 houses on the market and the number of people moving to Florida has leveled out, thereby creating more of a balance in the market.”

“It’s true that prices haven’t gone down substantially, but she says if they had, it wouldn’t really benefit anyone. ‘Think about it like gas prices,’ Atkinson said. ‘When you get used to $4 gas it feels like you’re saving money whenever you pay $3.75, but you were paying $2.50 five years ago. Everything is elevated. To go back to those numbers, we have would have to wear away all of that equity.'”

Tampa Bay Business and Wealth in Florida. “As Tampa Bay’s real estate landscape shifts, homebuyers face a different environment than even a year ago. In 2021, homes were flying off the market within days—if not hours—often with multiple offers, well above asking price. GTE Financials’ Steven Schertzer remembers listing his home that summer and receiving 25 offers in one weekend. Today, it’s a different story. ‘Homes are staying on the market significantly longer,’ he said. ‘The upside is that seller concessions are back. Buyers may now be able to negotiate thousands of dollars in credits toward closing costs.'”

“One of the most common misconceptions among first-time homebuyers is that an FHA loan is the only path forward. But there are other financing options that may be a better fit. One example is the 15/15 Adjustable-Rate Mortgage, designed to provide long-term savings with less short-term risk. There are also specialized programs like its medical professional loan—which provides up to 100% financing with no mortgage insurance for nurses and other healthcare workers—and multiple down payment assistance options. ‘Once rates go down, demand goes up and that pushes prices higher,’ Schertzer said. ‘That’s why you hear the saying, ‘date the rate, marry the home.’ You can refinance later, but you can’t go back in time and get a lower price.'”

Used House Salespeople. “After years of historically-low housing supply, housing inventory is finally rising across much of the United States. This recent increase — largely driven by the construction boom during the COVID-19 years, when mortgage rates hovered at record lows — has led to modest improvement in affordability in several markets. In fact, in many parts of the South, like Texas, Florida, and Tennessee, inventory has not only recovered but is now higher than it was before the pandemic. Even out West, in places like Colorado, listings have rebounded.”

From Denver 7. “A Colorado business owner facing criminal charges and multiple civil lawsuits related to Schwalb Builders has filed for bankruptcy, causing concern for some clients who hoped to be awarded damages in civil court. Clients reported they paid thousands, and the work was either never done or homes were left uninhabitable. Karen and Ben Davidson have the receipts from their experience with Schwalb Builders. They hired Schwalb in 2022 to remodel the basement and a bathroom in their Lakewood home. They said the contractor never pulled permits, did shoddy work, and caused a major asbestos spill that forced them to move out and dispose of almost everything they owned.”

“Denver7 Investigates has interviewed clients with similar stories of suing Schwalb Builders in civil court. Then we reported on criminal charges: a grand jury indicted Sean Schwalb, his father Avi, and multiple employees on more than 50 felony charges, including money laundering and theft. ‘I never thought it would develop into what it is now, where the owners have been criminally indicted. There are all kinds of shell companies and alter egos,’ said Matt Osborne, a consumer protection attorney representing the Davidsons. ‘Sean Schwalb was basically just using this as a Ponzi scheme, essentially, and it was all being funded by Avi Schwalb.'”

Silicon Valley in California. “The seizure of the Signia by Hilton San Jose hotel by the tower’s lender on May 12 in a foreclosure triggered by a $134 million delinquent loan is a fresh sign that Bay Area lodging markets continue to struggle.The foreclosure priced the hotel at $80 million, based on what lender BrightSpire Capital paid to seize ownership of the hotel at 170 South Market St. in downtown San Jose. ‘There are problems all over the Bay Area,’ said Mark Ritchie, president of San Jose-based real estate firm Ritchie Commercial. ‘There are still a lot of distressed sales. It’s going on in all the cities.'”

“The hotel sector’s ailments are particularly grave in San Francisco and Oakland, whose downtown districts appear to be locked in an economic ‘doom loop’ of fading property values, crime, empty commercial buildings and retail flight. In San Francisco, multiple hotel loan failures have emerged, including the foreclosure of a historic hotel that has a prominent perch atop swanky Nob Hill and the decision of multiple hotel owners to simply hand over their properties to lenders rather than continue to make loan payments. ‘The problems in San Francisco are widespread,’ Reay said. ‘People are just giving lenders the keys to the hotel and walking away.'”

The Globe and Mail. “As Canadians grow increasingly reluctant to cross the border, their real estate purchases in the U.S. are also expected to decline. That could be good news for Canadian realtors. Canadians were already unloading their Florida properties in 2024 due to inflation and higher costs, according to the American association, making up one-quarter of foreign sellers that year, compared to 11 per cent the year before. Ross McCredie, owner of McCredie Investments and Sutton Group Realty, said his mother-in-law owns property in the U.S. but would rather not be there. And he and his wife are less inclined to go to the U.S., where they used to live for several years. ‘Like a lot of Canadians, would we go and buy in the US right now? I don’t think so. Not right now. We love Mexico. We love other places in the world, and there are just other options. I think that’s what Canadians got so upset about, is that [U.S. President Trump] was attacking … wanting to destroy our economy, to put us on our knees and then take advantage of us.'”

“Cameron Kimball is an American expat who’s lived in Mexico for many years and laid down roots there, with his wife and kids. Mr. Kimball, who’s based in Los Cabos, is vice-president of sales and marketing for the new ultra luxury Residences at the St. Regis, a 33-acre site at the tip of the Baja Peninsula that includes a hotel. The vacation suites start in the upper US$3-million range and go up to US$15-million. ‘Everybody’s got their own reasons, but we’ve definitely seen an uptick in interest from Canadians, even though we already had a fair number of Canadians coming,’ said Mr. Kimball. ‘We’ve seen an uptick where they’re just outright telling us, ‘I have owned a second home, and it was in the U.S., and it is now on the market, and I will be coming to Mexico with that money.’”

From Global News. “Springtime in Canada historically means that, like the weather outside, the real estate market in Canada will start to warm up very soon, but things seem a little different this year. In big cities like Toronto and Vancouver, the past decade or so saw a big surge in multi-unit developments, and now the market is switching gears. ‘There’s a lot of condos in the market, which is driving prices way down because investors aren’t purchasing. The buyer pool has dried up because the majority of those were investors in the past, and now the investors are not coming,’ says real estate sales representative Stephen Moore at Century 21. ‘The condo prices are already inflated. You just need to take the loss if you’re selling and move on. It’s a tricky market for condos.'”

From Bloomberg. “It’s no secret — Toronto condo sales continue to tumble, plunging more than 30 per cent over the past year, adding further strain for those who bought at market peaks or hoped rental income would cover the bills. For a growing number of owners, the math no longer works — and some feel as if their financial life has ‘turned upside down.’ As the city’s condo market sags under the weight of stagnant inventory and falling demand, many homeowners are finding themselves with negative equity — owing more than their property is worth.”

“According to the latest figures from the Toronto Regional Real Estate Board (TRREB), condo prices in Toronto are down 7.3 per cent, year-over-year, with the average condo price in the city now sitting at $710,724. Experts say the situation is especially urgent for those nearing mortgage renewal, or relying on rental income to stay afloat. ‘It’s a huge risk,’ said personal finance expert Doug Hoyes. ‘Everyone thought prices were going to keep going up, but mathematically prices cannot go up forever — otherwise every condo in Toronto would be $10 million.’ Hoyes says he’s seen lots of people whose ‘monthly mortgage payment on renewal is going to go up a thousand bucks a month.’ According to a recent report from Rates.ca, 30 per cent of Canadians believe condos are no longer a good investment. Meanwhile, 57 per cent said they would not buy a condo for any reason.”

“Some owners may be thinking about cutting their losses; but experts say that can come with a serious financial hit. Hoyes says selling a condo with negative equity means covering the gap yourself, which very few people are prepared to do. ‘If you have $200,000 of negative equity, you‘re going to have to give the bank $200,000 when you sell the house in order for them to take the mortgage off,’ he said. ‘The bank’s not going to release the mortgage unless they get all their money.'”