February 12, 2015

Back To Earth

Marketplace reports on Florida. “Downtown Miami’s condo explosion turns out to run on its own financial logic. Peter Zalewski runs Crane Spotters, an information service on the building boom, explains that the bulk of these condos are not residences. They are apartment-shaped financial instruments. ‘In New York, you trade stocks. In Chicago we trade commodities. Miami, we trade condos,’ he says. ‘This is what we do,’ he continues. ‘We trade down here. These are traders who are not looking to live the American dream with a family of four and a dog. They’re looking to make a hundred-grand a unit … with virtually nothing being done but making a phone call to your broker in Miami and having him unload it to somebody else’s broker, who’s representing somebody in Russia.’”

From The Lens in Louisiana. “The following sentence in a T-P/Nola.com article about a conflict between Jax Brewery condo owners and a bar in the building caught my eye: ‘In addition to Earl and Jonathan Weber, there is only one other full-time resident living in the building, according to court documents.’”

“In other words, only three of the 25 units in the Jax Brewery building have full-time occupants. The remainder are presumably pieds-à-terre, apartments owned by wealthy out-of-state residents who may visit no more than a few weekends a year or investors who may rent them out on the illicit short term rental market. New Orleanians are already seeing escalating real estate prices on the high end that drive broader increases in housing costs farther down-market. Combined with the loss of housing to illegal short-term rentals, many long-time local residents can no longer find affordable housing in New Orleans.”

The Washington Post. “The Washington-area real estate market in January made steady gains in sales, inventory and prices, according to RealEstate Business Intelligence. Inventory, which had fallen sharply a few years ago, continued to rebound. There were 7,949 active listings, 1,204 more than the year before. There were also 1.7 percent more new listings. Buyers were also able to win a slight negotiating edge over pricing – sellers were getting 95.7 percent of their original asking price, down from 96.6 percent the year before. Houses sold in an average of 65 days – up from 55 days a year ago – perhaps spurring sellers to lower their prices to close the deal.”

“‘It’s an expensive area — more expensive homes sometimes don’t have as much demand as the more affordable segment,’ said Corey Hart, RBI’s senior product manager. ‘It could be there are fewer buyers competing for those higher-price segments that we see.’”

Impact News in Texas. “The energy industry makes up 32 percent of The Woodlands area job market among major employment sectors, making it the economic leader in the area. More than 8,800 workers are employed in the oil and gas industry in The Woodlands area. By all indications—unemployment rate, office space occupancy and interest from companies looking to do business in The Woodlands—the falling price of oil has had little effect on the area’s economic climate.”

“The local real estate market, which by some measures was the strongest it has ever been in 2014, is also expected to prove its resilience through the current energy downturn, said Ken Brand, sales manager for Better Homes and Gardens Real Estate Gary Greene Realtors. ‘Oil prices are falling and some people are concerned,’ Brand said. ‘But the market is not going to come back to Earth. There are thousands of people moving to the area, and they have to buy a home.’”

The Tampa Bay Times in Florida. “Tampa Bay led all major U.S. metro areas in completed foreclosures last year as lenders took back nearly 18,400 homes, houses and condos — 5.3 percent more than in 2013. Irwin Wilensky, whose SunRaye Realty has the listings for 200 bank-owned homes throughout the region, said judges seem to be speeding up foreclosures of investor-owned properties — often second homes that ‘John and Mary bought’ at the peak of the boom — as well as of long-vacant ‘zombie’ homes. ‘Pinellas in particular is trying to be aggressive in clearing the books of those properties because they don’t benefit anybody,’ Wilensky said.”

The Phoenix Business Journal in Arizona. “Foreclosures jumped more than 100 percent in January compared to December both in Phoenix and statewide, according to RealtyTrac. Foreclosure activity both locally and statewide are at 20-month highs as banks step up their repossessions, auctions and filing of default notices. The jump in foreclosures comes as the Phoenix housing market tries to shake off a slow 2014 where low demand for homes and tough mortgage qualifications stymied sales.”

“Foreclosure activity was also up in states such as Ohio, New Jersey, Maryland and California and metropolitan areas such as St. Louis, Los Angeles and San Francisco. The worst cities for foreclosures include Atlantic City, Las Vegas and eight Florida markets including Tampa, Orlando, Miami and Jacksonville.”

“‘The year-over-year increase in REOs in January was the first annual increase nationwide following 25 consecutive months of declines, getting the foreclosure spring cleaning we anticipated in our last foreclosure report off to a quick start in 2015,’ said Daren Blomquist, VP at RealtyTrac. ‘Meanwhile, the number of future foreclosure auctions scheduled in January continued to increase in many states, foreshadowing more foreclosure spring cleaning to come in the next several months in those states.’”

Bits Bucket for February 12, 2015

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