Many Homeowners Expect Values To Keep Soaring
The Orlando Sentinel reports from Florida. “Orlando’s housing market ranked fifth for year-over-year improvement among top U.S. metro areas but the shorter-term picture for the region showed softening, according to a new report by Freddie Mac. ‘The Orlando housing market is weak and declining,’ stated a report on Freddie Mac’s Multi-Index Market Indicator. Orlando continues to lag far behind nationally in terms of homeowners paying their mortgage on time. Of the mortgaged homes within the Orlando area, only 30 percent had been paid on time by homeowners. Nationally, homeowners’ rate of keeping current on mortgage payment was more than double Orlando’s rate.”
The Boston Globe in Massachusetts. “The median selling price of a Massachusetts single-family home fell last month on a year-to-year comparison basis for the first time since September 2012, the Warren Group reported. ‘Massachusetts is a high cost housing market, and the trend throughout the year has been increasing prices, so seeing prices stabilize is good for the market and good for buyers,’ Massachusetts Association of Realtors president Peter Ruffini said in a statement.”
The Dallas Morning News in Texas. “Dallas-area prices are now about 30 percent ahead of where they were at the worst of the housing bust in early 2009. But the rate of increase is slowing. Dallas’ August price rise was the smallest annual gain since March 2013. ‘As long as home inventory remains tight and job growth remains strong, prices should trend higher,’ said Ted Wilson, principal at Residential Strategies. ‘However, as housing affordability becomes an increasingly significant issue for many households in the D-FW area, we are unlikely to return to the double-digit gains we were experiencing this past year. The year-over-year gains have moderated, and this is reflective of the anecdotal reports we hear from builders and Realtors who share stories of ‘buyer pushback’ and ‘lack of urgency’ on some of the higher-priced offerings.’”
The Las Vegas Sun in Nevada. “Throughout the valley, listings of previously owned homes increasingly are being ignored, sales volume is dropping and prices aren’t climbing nearly as fast as a year ago, all while the share of cash buyers has plunged. Investors still comprise a sizeable share of local buyers, but faced with rising prices they helped create, their spending has ‘fallen off a cliff,’ Universal Realty owner Scott Beaudry said.”
“Despite the slower growth, many homeowners expect values to keep soaring at an eye-popping pace, and they want to sell for much more than their homes are worth. ‘There are a lot of unrealistic sellers,’ Realty One Group agent Jim Brooks said.”
CNBC on California. “Los Angeles may be filled with stars, but right now its housing market isn’t one of them. After benefiting from robust investor interest for the past few years, home sales are beginning to deflate. It is now taking significantly longer for sellers to get a contract. ‘The real estate market in Los Angeles is going back to a time where properties sit on the market possibly for four to six months, instead of flying out the door within 10 days and being sold,’ said Greg Bender, a local Realtor with Berkshire Hathaway HomeServices. ‘Buyers don’t have the same sense of urgency as they did before. They can be a little bit more discerning.’”
The New York Times. “William Ackman is a wildly successful hedge fund manager. Mr. Ackman told The Times that he is the buyer of the 13,500-square-foot condo with an estimated price of $90 million. What is more shocking is what he plans to do with it. Apparently content living with his family on the Upper West Side, he told The Times he was purchasing one of the most expensive properties in New York because ‘I thought it would be fun’ and he and some close friends ‘bought into this idea that someday, someone will really want it and they’ll let me know.’ Bill Ackman is a condo flipper!”
“Mr. Ackman is making a bet that the high-end real estate market in New York, for whatever reason, currently misprices the penthouse, and that in a few years this mispricing will be corrected. In the meantime, a 13,500-square-foot apartment with magnificent views of Central Park and, on a clear day, the entirety of New York, will sit empty the great majority of the time waiting for that day.”
“It may be the most expensive attempted condo flip in history, but in substance it isn’t much different from the middle-class dreamers who bought a preconstruction condo in Florida in the mid-2000s in hopes of selling it a couple of years later at a great profit.”
