Lots Of Choice And Thousands Of Motivated Sellers Who Are Ready And Willing To Make A Deal

A report from Mansion Global. “Condos prices fell by 2% in May in the U.S. compared to a year ago, the second-largest drop since 2012—with prices free falling over 30% in some markets—as the pandemic housing boom continues to unravel, according to Redfin. ‘It’s a slow housing market across the board, but condos have been hit particularly hard,’ Boston-based Redfin agent Aditi Jain, said in the report. Prices fell by 32% in the Florida markets of Deltona and Crestview, followed by 23% in Houston and 20% in Oakland, California. In all, seven Florida cities made the top 10 markets where prices are falling fastest—and they didn’t fare better on any other metrics. Condo sales were down more than 25% in Miami, Orlando, Tampa and Fort Lauderdale, as well as three other Florida cities. The crown goes to Dallas, though,, with a 33% drop in sales, with Phoenix not far behind at a 32% drop in sales compared to already low numbers last year.”

From Bloomberg. “A buildup of unsold houses sitting on the market for weeks is becoming a new reality in once-booming housing areas across the Sun Belt. In Florida, homeowners are fleeing soaring insurance costs, and in Colorado, investors are culling rental properties. ‘In the big picture it’s not horrible, but compared to what everyone was used to, it feels like molasses,’ said Michael Lauer, a broker in Florida’s Tampa Bay area. Lauer said spikes in flood and homeowners insurance are pushing people to sell lately. ‘Some people can afford it, but just don’t want to pay it’, he said. And while beautiful homes in desirable areas are still selling, the salad days of a few years ago are over. ‘Everything you listed had multiple offers immediately,’ Lauer said. ‘That’s long gone.'”

“The number of new and existing homes on the market in Colorado rose 51% in May from last year, and it’s up 110% over two years, one of the biggest gains in the nation, according to Realtor.com data. One contributing factor may be a series of tenant-friendly laws recently passed in the state that has turned off landlords, according to Windy Bailey, president of the Pikes Peak Association of Realtors in Colorado Springs. She sees frustrated investors selling off their rental properties, contributing to the supply of homes on the market.”

The Emporia Gazette. “Emporia is seeing a small surplus in house listings in recent months. At any given time, the city typically has 25 to 40 active listings, a number that lags behind the monthly average of 35 to 45 home sales. This has meant that over the last several years, Emporia has had less than a month’s supply of houses on the market at any given time. Right now, that number of listings is all the way up to 62 as of June 26. Kansas Association of Realtors President Jamie Sauder believes that this is a sign of what is known as a market correction. ‘The values have exceeded what is sustainable, and so buyers stop buying. And so in order for values to come down, you have to have more inventory come up,’ said Sauder, ‘and so my prediction would be that we’re in the middle of a correction. How large of a correction it is, I have no idea.'”

“According to the Kansas Department of Labor, Emporia’s unemployment rate is sitting at 5.2% as of April, stemming partially from the closure of the Tyson plant in February that affected over 800 workers in the area. ‘If someone isn’t sure they’re going to stay in the community, if there’s job uncertainty, those are all factors that can lead to decision making in terms of purchasing,’ said Sauder, ‘They’re taking more time to decide what they want to buy and if they want to buy what’s available. And because of that, we’re seeing the inventory pile up a little bit.'”

The Mesa Tribune in Arizona. “One of the leading analysts of the Valley’s housing market says homebuyers these days are getting more demanding in negotiations, including demands for wholesale renovations of rooms, before they seal a deal. Closed deals in Mesa fell year over year last month by 6.7% while the median sale price fell 2.6% in that time period to $490 and the average sale price dipped 2% to $573,516, Phoenix realtors reported. This month hasn’t been much better for sellers, according to the Cromford Report, which said two weeks ago that ‘the market is still getting less favorable for sellers.’ Both the median and average prices for homes sold in Mesa in May exceeded the Valley-wide average median sales price of $485,000. And inventory of unsold homes in the city climbed nearly 63% year over year to 1,393. Pending sales in Mesa last month plummeted year over year by 43.4% to 151, according to the association’s data.”

“Phoenix Realtors also said, The number of new listings has some calling this a ‘buyer’s market.’ New listings climbed to a year-to-date total of almost 42,000 homes. ‘Those 7,460 homes newly listed in May sit close to the monthly average of the last 10 years.’ The Cromford Report added more recently, ‘The overall picture is discouraging for sellers, but enthusiastic buyers are in a very strong position: lots of choice and thousands of motivated sellers who are ready and willing to make a deal. This is not just true for re-sales, as most new home builders are also anxious to sell, and are willing to make some brilliant offers, especially when it comes to buying down your mortgage interest rate. We have not seen such a favorable situation for buyers since March 2009.'”

Coastside News in California. “In some ways this really isn’t news as our inventory has a pretty predictable pattern over the years. Inventory starts off the year at a low level, increases in the second and third quarters and falls in the fourth quarter. What is news, though, is that inventory ending for the second quarter is at the highest level in many years and the ratio of available homes sale pending to total inventory is also high. In fact, you’d have to go back to the second quarter of 2019 (pre-COVID) to find inventory higher. So what’s for sale on the coast today? At the end of the second quarter, there were a total of 92 homes for sale of which 70 are available and 22 are sale pending. That means 76% of all inventory is available, which is higher than normal. Prices range from $599,000 for a 910-square-foot home in La Honda on a half acre, to $7,980,000 for a 6600-square-foot home in Pescadero on 18 acres. Of the 92 homes for sale, 24 had price reductions and one had a price increase. The South Coast has 19 total listings with 16 available and three sales pending with prices ranging from $599,000 to $7,980,000. Half Moon Bay has 41 total listings with 31 of the available and 10 sales pending with prices ranging from $1,150,000 to $5,499,000. Looking forward, I feel confident that inventory will increase next quarter and possibly go up a lot if the Federal Reserve actually decides to lower interest rates as more buyers and sellers will enter the market.”

The Los Altos Crier. “In light of the recent Southern California wildfires, California residents probably assume that their homeowner’s insurance premiums will be going up – but by how much, and how do California rates compare with those in the rest of the country? First, the bad news: Insurigy expects California’s home insurance premiums to rise 21% by the end of this year to an average $2,930 per single-family home. That’s among the highest increases of any state. Surprisingly (at least to me), even after such a huge increase, California doesn’t even make the top 10 states with the highest premiums. In fact, the average premium cost in California is likely to continue to remain well below the projected average rate across the U.S. ($3,520). The most expensive state for home insurance is Florida, with a projected annual cost in 2025 of $15,460. Other states with excessively high rates include Oklahoma ($8,369), primarily from tornadoes; Colorado ($6,630), from hail and wildfires; and Nebraska ($5,203), from hail and severe storms. Texas rates are high ($6,522) due to a plethora of weather-related events.”

Bisnow Washington DC. “With the Trump administration’s moves to slash the federal budget and cut hundreds of thousands of federal jobs, multifamily developers in the D.C. area are fighting an uphill battle to woo capital. Investors are skittish of putting money to work in the District, Northern Virginia and suburban Maryland. ‘We haven’t spent a day this year without talking about DOGE in some capacity, or rather, a day since February,’ Mill Creek Residential Senior Managing Director of Development Joe Muffler said onstage at the event. ‘It has dominated every conversation we’ve had with every capital partner trying to make deals work,’ he said. Since President Donald Trump took office for the second time, at least 128,709 federal employees have been laid off or targeted for layoffs by federal agencies, according to CNN.”

Business in Vancouver in Canada. “Surrey city council last week approved hundreds of new rental units, many of which were previously intended to be condos, illustrating how developers are adapting to changing market conditions. During a June 23 meeting, Surrey city council approved 758 net new rental units across three projects alone. ‘In response to the current state of the real estate market, specifically presales, the developer has pivoted their approach to meet the project’s proforma requirements,’ said a June 23 planning report about SkyLiving’s application. One expert said the larger pattern is due to insufficient presale demand and lower consumer confidence amid economic uncertainty. ‘In today’s market, it’s just hard to achieve those presale requirements that you need in order to put a shovel in the ground,’ said Manraj Dosanjh, real estate advisor with Dexter Realty. Pivoting toward rental could potentially unlock preferential financing terms; qualify for municipal incentives like relaxed community amenity contributions; and avoid interest payments on idle land, he said. On the other hand, Dosanjh said the shift is not without consequences. For example, some presale buyers may not realize they are buying into projects that now have large rental components.”

City News in Australia. “The ACT is on track for its worst year of housing approvals in nearly two decades, with new data showing little improvement from a record-low April. ABS building approvals data for May shows just 107 new dwellings were approved in the ACT – up from 84 in April, but well below March’s figure of 681. Property Council ACT & Capital Region executive director Ashlee Berry said that with only June numbers remaining to be seen, total approvals for 2024–25 currently sit at just 2036. ‘The last time annual approvals fell this low was in 2005–06 – the alarm bells should be deafening,’ Ms Berry said. ‘Approvals are falling off a cliff, projects are being shelved, and we’re on track for the lowest housing delivery in 20 years. The government says it wants more homes, but last week’s budget told a different story. You can’t build confidence while you’re hiking taxes and rates and making it more difficult – not easier – to build the homes Canberra needs.'”