The Housing Bubble

A weekend topic on a piece written by Bill McIntosh - a full-time realtor in Nevada for 20 years. It’s in The Spectrum. “Michael Lewis wrote ‘The Big Short,’ a best-selling book about the recent housing and credit bubble, that has since been developed into a movie. Near the beginning of the film, a Mark Twain quotation fills the screen, ‘It ain’t what you don’t know that gets you into trouble. It’s what you know for sure that just ain’t so.’ The start of a new year in Mesquite is usually the peak season for new listings and hope for increased prices from escalating demand. During the first three weeks of this year, 77 new listing were taken, plus 14 added back-on-market properties, while just 35 single family homes, townhomes and condos accepted offers. Total active listings stood at 314, and this figure was just 16 properties short of the 2015 high.”

“In 2005, near the top of the market, a Mesquite property was purchased for just under $200,000. Slightly over a year later, it became an active listing at a price that would allow the owner to make a very slim profit. It remained listed at that price for more than a year without a buyer.”

“Now, 2006 is regarded as the year prices started to fall. Five years later, and now owned by the lender, this property sold in the low $100,000 range. I am sure the owner that lost the property ‘knew for sure,’ in 2005, that prices would continue to rise for a number of years.”

“Of the 314 active listings, 98 have been listed between 30 and 100 days, 76 between 100 and 200 days, 47 listed 200 to 365 days with 17 over a year. These numbers only represent the current listing period, many have been listed more than once with various real estate offices.”

“While the housing bubble was inflating, only two or three savvy investors took the time to examine the actual loans supporting Wall Street’s mortgage-backed securities or talk to the rating agencies that were placing profit ahead of accurate ratings. The devil can be found in the details if one takes the time to review statistics.”

“With well over 300 listed resale properties, and numerous new home developments building a variety of models, Mesquite has more than six months of supply in real estate at the current rate of absorption – or a buyer’s market demanding competitive pricing for success. Your agent has the statistics to confirm, or alter, ‘what you know for sure.’”

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It’s Friday desk clearing time for this blogger. “With 15 years in the local market, Keller Williams Realtor Bruce Lynn can remember a day when people bought nice homes in North Texas for under $140,000. ‘You can’t find a $140,000 house anymore,’ he said. Actually, you can. They’re just not as plentiful. At that price point, we found about 2,000 local homes for sale on Zillow. But then we searched for homes in the $300,000 to $600,000 range and found almost three times as many properties available. Prices have gone way up. Lynn said he now has a lot of ‘wow’ days as he looks at recent sales. ‘Where you say, ‘Wow! That house sold that fast, for that price?’”

“Lynn has seen evidence of the increases in deals he’s done. He points to a townhome near downtown Dallas he’s handled in the past. In 2009, it sold for $200,000. The same property sold last summer for $304,000. ‘The second one down, same thing; they paid about $150,000 in 2009. Then in June (2015), it sold for $280,000,’ he said.”

“Developer Steven Witkoff is holding off on converting Manhattan’s Park Lane Hotel into luxury condominiums — for now. He led a group that acquired the property from the estate of Leona Helmsley for $660 million in 2013. Since then, the allure of building high-end homes has dimmed as new towers aimed at multimillionaire buyers crowd the market. ‘The fact of the matter is, the velocity is not what it was,’ said Witkoff.”

“Plans for the Park Lane, at 36 Central Park South, are taking shape as Manhattan’s luxury sales market shows signs of an oversupply after a post-recession construction surge. Prices of the most-expensive homes have been dropping since February. Witkoff and his partners have shelved an effort to raise cash from Chinese individuals through the EB-5 program, which grants green cards to foreigners who invest a minimum of $500,000 in projects that create jobs. The slowdown in the Chinese economy and unresolved EB-5 reform efforts in Congress are clouding the future of the program, Witkoff said.”

“Europe’s biggest lender HSBC will no longer provide mortgages to some Chinese nationals who buy real estate in the United States, a policy change that comes as Beijing is battling to stem a swelling crowd of citizens trying to get money out of China. An HSBC spokesman in New York told Reuters that the new policy went into effect last week, roughly a month after China suspended Standard Chartered and DBS Group Holdings Ltd from conducting some foreign exchange business and as authorities try to limit capital outflows.”

“In Vancouver, an HSBC spokeswoman said HSBC’s Canadian arm already had similar policies in place. The Royal Bank of Canada scrapped its C$1.25 million cap on mortgages to borrowers with no local credit history last year in a bid to tap into surging demand for financing from wealthy immigrant buyers.”

“China’s State Administration of Foreign Exchange said late last year it would soon launch a system to monitor foreign exchange businesses at banks and put people who tried to buy more foreign currency than is allowed on a watch list. Those found trying to purchase more than the maximum $50,000 in foreign currency a year would be placed on a watch list, it said.”

“B.C. led the country in economic growth last year and is poised to do the same in 2016. But some economists and politicians are questioning how rosy that picture is given the province’s reliance on real estate and the B.C. government’s stance on housing affordability. Compared to other Canadian cities, Vancouver’s housing market is uniquely unbalanced when home prices are compared to median incomes. Based on the trend that is happening in places like California, New York, Sydney and Hong Kong, in which wealthy people from emerging economies seek to stash money in real estate as a safe haven, British Columbia should be proactive about tracking and responding to the phenomenon, said Tom Davidoff, a professor of economics at UBC’s Sauder School of Business.”

“‘It doesn’t cost you much to not have a tenant because a house gives you a rate of return in two ways: it gives you a dividend and it gives you a capital gain,’ Davidoff said. ‘It’s sort of a new phenomenon globally, but when you think about it we’re ideally set up to delete the home part of housing.’”

“With Singapore housing prices continuing to fall and transaction volumes still low, fewer people are choosing to become property agents. Former estate agent Brendan Ng was one of those who did not renew his licence this year. Instead, he has been driving a taxi for the past few months because the income is more regular than that of an agent. Huttons agent Megan Chiew took on a new full-time job as an account executive with a trading company in 2014. Said Ms Chiew: ‘My income as an agent was too unpredictable. Some months, I could not close any deal.’”

“The four-storey flat in Kitengela, a suburb south of Nairobi, Kenya, stands imposingly, dwarfing all the other houses in its vicinity. Atop the flat and on the sides are huge signboards announcing that the two and three-bedroom houses are up for rent. About three months ago, the boards carried a different message for about a year. They announced that the houses were up for sale. Having found it hard to sell the houses, the property developer, who has other units in Nairobi, decided to rent them out. It is a path many house developers, especially those who have built apartments, in the East African nation’s capital are taking.”

“‘I must admit things are not really looking good in the property sector. The bubble people have been talking about seems to have burst because both selling prices and rent for apartments are falling,’ said Antony Kuyo, a real estate consultant with Avent Properties in Nairobi.”

“For the first time in nearly seven years, residential rents in some neighborhoods in Qatar are starting to go down as landlords struggle to fill housing vacated by laid-off expats, a local real estate firm has said. ‘We’re in a very different country now than we were 12 months ago,’ DTZ associate director Johnny Archer told Doha News. ‘Rents will drop. It’s inevitable. In fact, they’ve already started.’”

“DTZ estimates that up to 13 towers in Porto Arabia and Viva Bahriya are nearing completion and could increase the number of new units in the Pearl-Qatar hitting the market in 2016 by roughly one-third over last year. ‘This will add a huge amount of supply,’ increasing vacancy and putting downward pressure on rents, Archer said.”

“The Property Institute’s boss says reducing Auckland home values would be devastating for the economy. Ashley Church was responding to a survey which found Auckland now has the fifth least affordable houses in the world. Church said there was no quick fix to a trend that had been developing over decades, and a ‘knee-jerk’ response could do more harm than good. Around 65 per cent of Kiwis owned homes, many of whom used the equity to buy businesses or invest in other assets. ‘So reducing the value of their home could have a devastating effect on the economy and could bring the whole thing down like a house of cards.’”

“Labour’s housing spokesman Phil Twyford said the report confirmed Auckland’s status as ‘a housing basket case.’ The Government had been blaming the Resource Management Act for a decade, but a crackdown on property speculation and a state-backed housing programme was what was needed. ‘The truth is, they are paralysed with fear that the bubble will burst on their watch, so don’t want to tackle the causes of the crisis.’”

“Insufficient funding or poor management of state programs in seemingly disparate areas has allowed high levels of poverty to persist in New Jersey and stymied families’ efforts improve their lives, legislators and advocates said yesterday. ‘It’s incredible to think that the state of New Jersey has higher poverty than it has had in the last 50 years. It’s 40 percent greater than before the recession of 2008,’ said Assembly Speaker Vincent Prieto, who launched an anti-poverty policy initiative last week.”

“The high cost of housing was another focus of the day’s discussions. New Jersey is the fifth-most-expensive state in which to rent a two-bedroom apartment, at $1,309 a month, Housing and Community Network president Staci Berger told the Assembly housing committee. If housing is supposed to consume no more than 30 percent of income, that means a family must earn $52,347 a year to afford such an apartment — an impossible task for someone working at the minimum or even average wage, she said.”

“‘The housing affordability and foreclosure crisis is the albatross around the neck of our economic recovery,’ Berger said. ‘Our housing market is like a food market that only regularly offers filet mignon and caviar; we need Hamburger Helper and tuna fish, too.’”

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A report from the Real Deal on New York. “Chinese investors only really started piling into New York’s commercial real estate market two years ago, and The Real Deal proclaimed 2015 the ‘year of the Chinese investor.’ But now, a growing number of developers argue the party may already be over. ‘We should be looking for other sources of capital over the next few years,’ Jeff Blau, CEO of the Related Companies, said at a 2016 real estate outlook conference hosted by ULI New York Wednesday morning. Related received bids from all over the world to recapitalize the first Hudson Yards tower by Tuesday, Blau said, but Chinese investors were notably absent. ‘We got probably 10 bids to recap, but no Chinese,’ he said.”

“Leslie Himmel, a principal at Himmel + Meringoff Properties, suggested that a slowdown in luxury apartment sales to foreigners could doom condo projects and ultimately spill over into the office market, pushing down prices. ‘Are we going to go back to basics,’ she said, ‘where trees don’t grow to heaven and where we will be able to buy at a four, or five or six cap?’”

The Los Angeles Times on Texas. “Of 40,000 estimated jobs lost in the oil and gas sector in the Houston area last year, many were on the west side, including about 13,000 white-collar professionals. On the west side, luxury town homes sit empty, and million-dollar homes that once sold within 48 hours linger on the market weeks later. Clark Martinson, general manager of the Energy Corridor District, has friends who have taken early retirement, sold summer homes or unloaded their homes here and moved into rentals. ‘People were happy, living fat, and now it’s leaner,’ he said.”

“Doug Poteet, an offshore engineer, complained that ‘massive layoffs’ have forced friends with decades of experience in the oil industry to go to work for UPS, Uber and car dealerships. ‘If this goes on another year, you’re going to start to see foreclosures,’ he said.”

WVVA on West Virginia. “As the coal industry declines and jobs begin to disappear, housing markets in southern West Virginia feel the strain. Raleigh County is no exception. ‘800 houses on the market, real estate for sale, and what does that tell you? A lot of people are leaving. I know one public service district here locally has 97 empty houses,’says Dave Tolliver, Raleigh County Commission president.”

“The risks for the housing market lie in foreclosures as money dries up but also in the amount of houses popping up for sale. ‘Typically when someone gets laid off and they don’t have a chance of being called back to work, they’ll try to get their house on the market and get it sold. Obviously if too many come on the market, supply and demand kicks in and that pushes the prices down,’ says Mike Tyree, broker owner at Century 21 First Choice.”

KFYR TV on North Dakota. “After several years of rapidly increasing home prices in the Bismarck-Mandan area, prices are now stabilizing. The area is now in what one realtor describes as a corrective market. Alliance Real Estate’s Patsy Chapman says this correction began about 18 months ago. ‘When the market is escalating, it just seems like a lot of people have buyer’s remorse later on. This time, they’re able to step back and give a little more thought to their purchase, so I think it’s a win for everyone,’ Chapman said.”

KTNV in Nevada. “A vacant store that had recently been turned into a ‘homeless condo’ according to neighbors is now boarded up. Clark County sent crews out to secure the property just days after Action News contacted them about the problem that nearby businesses say has been going on for a month. Clark County Commissioner Chris Giunchigliani says she sees the problem all over the valley, including in many vacant homes. ‘If you think about it in housing, you’ve got so many out of state property owners or banks that don’t give a hoot,’ Giunchigliani said.”

From CBS News. “Back-stopping the nation’s banking system was the top federal priority during the height of the 2008 financial crisis. But out of the $475 billion that Congress authorized for the Troubled Asset Relief Program (TARP), $46 billion was supposed to help millions of struggling families avoid foreclosure. In 2013, Christy Goldsmith Romero, special inspector general for TARP, warned that homeowners were defaulting on their modified loans at an ‘alarming rate.’ In the IG’s most recent quarterly report to Congress in September 2015, the rate of default on these reset mortgages increased greatly over time.”

“For borrowers who first sought mortgage relief under HAMP when the program was launched in 2009, the redefault rate is nearly 53 percent. Overall, more than a third of people who have participated in the program over its lifetime have redefaulted. ‘The longer a homeowner remains in HAMP, the more likely he or she is to redefault out of the program,’ Romero’s office concluded.”

“‘Nobody wants to deal with the reality that these mortgage modifications were not affordable long term,’ said Kathleen Engel, a research professor at Suffolk University Law School in Boston and author of ‘The Subprime Virus: Reckless Credit, Regulatory Failure and Next Steps.’ Said Engel: ‘[The mortgage modifications] were all predicated on the property values appreciating in value, but they actually declined.’”

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A report from Bloomberg. “The six-bedroom mansion in the shadow of Southern California’s Sierra Madre Mountains has lime trees and a swimming pool, tennis courts and a sauna — the kind of place that would have sold quickly just a year ago, according to real estate agent Kanney Zhang. Not now. Zhang is shopping it for a discounted $3.68 million, but nobody’s biting. Her clients, a couple from China, are getting anxious. They’re the kind of well-heeled international investors who fueled a four-year luxury real estate boom that helped pull America out of its worst housing slump since the 1930s. Now the couple is reeling from the selloff in the Chinese stock market and looking to raise cash to shore up finances.”

“Across the U.S., the story is much the same. The world’s economic woes — from China to Russia to South America — are damping sales in the high-end real estate market. In the Los Angeles suburb of Arcadia, where Zhang is struggling to sell the six-bedroom home, dozens of aging ranch houses were demolished to make way for 38 mansions built with Chinese buyers in mind. They have are priced as high as $12 million. Many of them sit empty because the prices are out of the range of most domestic buyers, said Re/Max broker Rudy Kusuma, who blames a crackdown by the Chinese on large sums leaving the country.”

“In Sunny Isles, Florida, faraway currency fluctuations are endangering the sale of a $3.7 million condominium. A Colombian woman who put down a 50 percent deposit is fretting over how she’ll cover the other half over the next year, said her agent, Mauricio Rojas. In Houston, the plunge in oil prices to a 12-year low is killing the luxury boom. The whole Houston real estate market is going to take a hit ‘but the upper end is going to be impacted most,’ said Patrick Jankowski, senior vice president of research for the Greater Houston Partnership.”

“Even in San Francisco, where the market for luxury properties remains strong, the inventory of listings for $2 million or more jumped in October to a record level, said Patrick Carlisle, chief market analyst for Paragon Real Estate. Both buyers and sellers were getting increasingly worried about the direction of the economy, he said. ‘More sellers are jumping in and more buyers are holding off because they’re worried about where the volatility is going,’ Carlisle said.”

DNA Info New York. “Much has been made of the effect of foreign investors on driving up New York real estate prices, with some local real estate companies specifically soliciting foreign buyers for upcoming projects before soliciting New York residents. A wave of condos where foreign buyers purchased — as investments to rent out — are flooding the rental market, causing a glut of high-end listings as other high-end rental buildings are simultaneously opening, said Karla Saladino, managing partner at Mirador Real Estate.”

“‘We’re seeing major price drops below last winter’s rent,’ she said of rentals. For instance, when marketing a ’stunning penthouse’ in the Flatiron, Saladino looked at comparable units for pricing information. Usually, she’d find about four similar high-end units. This time she found 48.2.”

The Broward Palm Beach New Times in Florida. “The U.S. government announced two weeks ago that it will begin monitoring all-cash home sales of $1 million or more in two counties — New York (a.k.a. Manhattan), and Miami-Dade, where fraud is also expected. In response to an article about the new program, Melissa Hoff Roth, a Fort Lauderdale realtor, shared her own thoughts about the crackdown on Miami’s condo market on Facebook. She wasn’t exactly upset. ‘Got cash?’ she wrote. ‘The Ft Lauderdale market is hot and a better deal than Miami anyway! Give us a call!!’”

“That’s right: Hoff Roth, and her business partner, Howard Elfman — who is both the president of the Fort Lauderdale Association of Realtors, and director of the entire state’s Association of Realtors — believe the federal monitoring program will push these foreign buyers out of Miami and up into Broward. And they think this is a good thing. ‘It’s a blessing for Broward,’ Hoff Roth said. ‘We’re going to say, ‘We’re not going to look into your pocketbooks, your bank accounts. If you have money, if you can provide a cashier’s check. We’ll work with you. And it’s happening just as Miami is falling.’”

The Denver Post in Colorado. “Metro Denver apartment rents leveled off and vacancies rose sharply between the third and fourth quarters after a surge in new supply left more landlords scrambling to fill their units, according to a quarterly update from the Apartment Association of Metro Denver. In a sign more downward pressure on rents could be coming in the months ahead, the area’s apartment vacancy rate surged to 6.8 percent from 5 percent in the third quarter. It was the biggest quarterly surge in vacancies since heavy job losses caused people to move out of their apartments back in 2008 and 2009.”

“Vacancy rates were highest in northwest Denver at 17.4 percent; Boulder County, excluding Longmont and the city of Boulder, at 14 percent; downtown Denver at 11.2 percent; and north Douglas County at 9.6 percent. Developers have focused on those areas for higher-rent apartments. Given that owners of new apartment buildings may not be familiar with the survey, or may be too busy leasing units to respond, the actual vacancy rate in those areas might be understated, said report co-author Ron Throupe, a real estate professor at the University of Denver.”

“Supporting the argument of oversupply on the high-end of the market, the more affordable areas developers passed over show much tighter apartment vacancy rates. The report said developers added 1,678 new units to the local market, but that net absorption was a negative 4,247 units, meaning once-occupied units were sitting vacant. Throupe, however, dismissed concerns that the apartment market was headed for a ‘crash’ or that the rising vacancy rate signaled a deeper economic weakness. ‘Rents won’t crash,’ he said. ‘We will go flat for awhile. We aren’t having a major downturn.’”

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Investors Business Daily reports on China. “China’s capital outflows jumped in December, with the estimated 2015 total reaching $1 trillion, underscoring the scale of the battle facing policymakers trying to hold up the yuan amid slower economic growth and slumping stocks. ‘The immediate trigger for a pickup in capital outflows toward the end of the year was the People’s Bank of China’s poor communication over its shift in currency policy,’ said Mark Williams, chief Asia economist for Capital Economics Ltd. in London, who previously worked on China issues at the U.K. Treasury. ‘Outflows are likely to remain strong because the People’s Bank still has not been able to generate confidence among investors that it knows what it’s doing or that it’s able to achieve its policy objectives.’”

Stuff in New Zealand. “Crashing stockmarkets and a crackdown on cash leaving China could disrupt plans for development and investment in New Zealand. Economist Shamubeel Eaqub said the outflow of foreign investment from China was ‘massive’ in 2015, but new rules and regulations would rein it in. ‘They’ve really tightened up in terms of letting money leave the country,’ he said.”

“The impact is already being felt. Late last year, Chinese investor He Run International pulled the plug on a proposed $80 million dairy factory development in Otorohanga. Minority local shareholders were told the plan fell over due to the stock market crash in China, and restrictions on withdrawing funds. ‘We suspect the funding issue was the biggest issue because of what is occurring in China with the stock exchange and the flow of money out of China. It is nearly impossible to get any funds out to do what they wanted to do here in New Zealand,’ local investor David Carey said.”

“Massey University’s Yuanfei Kang, a senior lecturer in the School of Management, said the extent of any capital restrictions would be linked to the fortunes of China’s economy. ‘If the economic situation becomes worse, further measures will be taken,’ Kang said.”

The Singapore Business Review. “The supply glut won’t ease anytime soon. Developers will have to grapple with an intense oversupply of new homes over the next three years, according to a report by Maybank Kim Eng. ‘Together with the net increase in executive condominiums (ECs) and public housing, we forecast an annual net increase of 41,400 homes for the next three years. This is double the 21,800 in the past decade,’ Maybank Kim Eng said.”

The Strait Times on Australia. “Australia’s surging property prices have led to spiralling mortgages and left the nation’s households ranked as the most indebted in the world, prompting concerns that the market is in a bubble. Most analysts are forecasting a ‘cooling off’ period, saying the nation’s 15-year run of soaring home prices will finally end due to stagnant rental yields and low affordability. An expert on Australia’s real estate economics, Dr Nigel Stapledon from the University of New South Wales, said the market appeared to have finally peaked last year and had begun to slow.”

“Dr Stapledon said a lot of apartment blocks are due to be completed and come onto the market in Sydney and Melbourne this year and in 2017, which will significantly add to supply. Also, he said, the end of Australia’s mining boom has dampened the economy and slowed immigration growth, which has affected demand for housing and rentals. ‘I don’t think policymakers have any reason to stop a reversal,’ Dr Stapledon said. ‘State governments should continue to re-zone and open up land for housing. What is the problem with prices dropping? If houses lose a chunk of their recent gains, it is a good thing.’”

The Peninsula Qatar. “Qatar’s real estate prices softened a bit during the final quarter of 2015 compared to the previous quarter, after hitting a record peak in November 2015. ‘These are interesting times for Qatar,’ said DTZ Qatar’s new Residential Agency Head, Bashir Jama. ‘On one hand, developers have tended to be drawn towards the upper and prime housing sector, whereas the real opportunity presents itself in the demand/supply gap in the lower end of the housing market. The difficulty is the price of land; developers focus on the higher end markets as the high-end market is perceived to provide higher returns.’”

From Letting Agent Today in the UK. “Typical rents in Scotland are down from £757 per month to £747 according to Citylets - just as the Private Housing (Tenancies) (Scotland) Bill is being considered, with a provision for rent caps. Average rents in Aberdeen have fallen 15.9 per cent over the last year, largely because of oil price falls dragging down the local economy. ‘We generally report on what we have seen but it isn’t hard to foresee annual growth for Scotland tending towards zero later in 2016. Aberdeen has further to fall’ warns Citylets founder Thomas Ashdown.”

The Western Morning News. “It is interesting how the Brits’ fascination with property has evolved over time. At present prices, UK residential property is now ‘worth’ about £5trillion (£5,000 billion) and about 65% is owner occupied. Commercial property, all those shops, factories, offices, plant is ‘only’ £400billion. The London Stock Exchange, which includes multinational giants with most of their assets and income overseas, is only worth £2.25trillion. British Government Bonds are £1.5trillion. There is approximately £700billion of cash on deposits held by individuals.”

“It is interesting how something in which we live – and costing us considerable upkeep – has become so significant in terms of our societal structure. I am very alarmed at the excessive price levels of the average ‘home’ but our governments must be concerned that so much of our economics are impacted by what is happening in housing – and the confidence of those who own it. We should all never forget that over-reliance upon one economic asset, a simple box in which to live, however pretty or comfortable, does not make it immune from irrational excess and frankly, the figures are all out of kilter regardless of the lack of enough new homes being built and the insatiable demand for them – apparently (but never forget that all the people here at the moment do have somewhere to live).”

“However, in reality, the order of asset values should perhaps be: stock market (the base of all our commerce), residential property, commercial property, government bonds. You can see the model requires some considerable re-balancing but perhaps a doubling of the stockmarket is more unlikely than a halving of the value of homes (though the latter would still constitute significant ‘value’ though I shouldn’t wish even to countenance what that would mean for the economy and bad debts). Sadly though, this may be the necessary adjustment required to return to ‘normality’ so watch-out as each could indeed arise.”

“Yes, indeed, what we think we know – and like – is property, so do I. However, that leads to excessive emotional dependence upon a judgement where we don’t ever want to be wrong and of course, we live in one too and feel snug about the thought of making money whilst we sleep as these things always go up, don’t they.”

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The News Press reports from Florida. “‘Hitting on all cylinders’ is how Naples-area real estate pros described their market’s 2015 performance at Friday’s NapLes Area Board of Realtors year-end wrap. 2014 and 2015 were near-record years in almost every category, according to Downing Frye realtor Mike Hughes. ‘It’s unusual to get two great years in a row. It made me flash back to 2004 and 2005,’ Hughes said. A word of advice to low-end home buyers: number of days on the market are getting vanishingly close to zero. ‘Low-end buyers need to be prepped to move quickly. Thinking about it isn’t an option,’ Hughes said.”

“But the surprise of the year was land. ‘Someone once said, ‘Under all is the land.’ It is so true in Naples,’ said appraiser Cindy Carroll. ‘Recovery has been taking place in the underlying land value,’ she concluded. Even in Golden Gate city, where lots in the recession sold for 7 cents on the dollar, vacant land is listing for $80,000, at or above pre-recession prices.”

ABC 7 News on California. “The U.S. stock market isn’t the only part of the economy affected by the slide in Chinese markets. The U.S. stock market has followed suit and the ripples are starting to hit the Bay Area real estate market. ‘The Chinese economy has seen quite sharp drops in the stock market as well as general economic activity,’ said Ralph McLaughlin, the chief economist for Trulia. McLaughlin says hits from China are down nearly 50 percent so far this year. ‘What we see is quite a decrease in the number of Chinese home seekers looking for homes on Trulia in San Francisco,’ said McLaughlin.”

“Mortgage broker John Holmgren says some of his local clients, who are relying on their stock portfolios for a down payment on a house are having second thoughts. ‘We have a lot of clients, who are from the tech sector and they had stock options they were about to exercise that were in the money that would allow them to cash in and make a down payment. Now, not so much,’ explained Holmgren.”

The Herald Mail in Maryland. “The number of properties that received a foreclosure filing in Washington County was 39 percent higher than the previous month and 24 percent higher than the same time last year, according to RealtyTrac. Jeff Matthews, president-elect of Pen-Mar Association of Realtors in Washington County, said homeowners find themselves in foreclosure for a number of reasons. ‘Part of the problem is interest rates,’ Matthews said. ‘Adjustable interest rates have creeped up on them. And, life happens. A loss of a job can have an effect.’”

“As a result of the nation’s mortgage crisis in 2008 and 2009, when foreclosures peaked around the country, lenders have been forced to work with delinquent homeowners to help them stay in their homes. Yet Washington County Circuit Court still processed 536 new foreclosure filings in 2015. ‘It still amazes me that many mortgages are in trouble,’ Circuit Court Clerk Dennis Weaver said. ‘It has to affect the housing market.’”

The Roanoke Times in Virginia. “Foreclosures in the Roanoke area rose by more than 38 percent in 2015 from the previous year, according to RealtyTrac. Lenders are still working through foreclosure procedures even years after houses were vacated. Roanoke Realtor Bonnie Hall, who deals almost exclusively with foreclosed properties, said a lot of the new properties are so-called shadow inventory — properties that stalled in foreclosure and have not been sold, or homes that banks delayed putting on the market until conditions improved. She said she had more foreclosure properties sent to her this winter than she has seen in the last five or six years and doesn’t expect it to slow down any time soon.”

“Many of the properties were vacated during the recession but are just now hitting the market. Kit Hale, a broker at MKB properties in Roanoke, said 2015 showed a drop in the foreclosure properties sold and, ‘with an improving market, I do not believe that shadow inventory is so pent up as to saturate our market in 2016.’ ‘While I’m sure some REO companies are holding inventory until the market improves, I do not believe it is a significant number,’ he said. ‘Over the last five years, there has been an unbalanced inventory as it relates to demand. In other words, we have been in a sustained buyers’ market due to REO properties and company relocations.’”

The Casa Grande Dispatch in Arizona. “After years of serving as an unofficial monument to the housing collapse, a long-standing cluster of vacant homes south of the railroad tracks in Maricopa was demolished last month. Santa Rosa Crossing sprang up from Hallcraft Homes in 2004-05, with the builder constructing several homes before the market began to go bad, forcing the development into bankruptcy. Realtor Brian Petersheim started working the real estate scene in Maricopa in 2006, with a specialty in new and spec home sales. ‘Every time I would go by, it would be locked up or nobody would be there,’ Petersheim said. ‘After doing this for about six months, I noticed the trailer was all of a sudden locked up.’”

“Martin Scribner, director of development services for the city of Maricopa, said 29 homes were built to be offered to buyers before the bottom fell out. ‘Basically these houses have sat empty for 10 years, and they never were lived in,’ Scribner said. Scribner described the properties as having been ‘pretty much wrecked.’ When asked why it has taken so long to tear down the vacant homes, he said that was a good question. ‘In the past, when everything collapsed, it wasn’t really a priority,’ he said. ‘There was so much going on, so many empty houses. Yeah, it was a blight.’”

KGW in Oregon. “Stars of the HGTV show Flip or Flop are speaking out about their canceled appearance in Portland late last year. In an article posted on the real estate site Zillow Porchlight, Christina El Moussa talked about the controversy that surrounded the couple’s scheduled seminar, which promised to teach the ins and outs of buying, renovating and selling houses.”

“El Moussa wrote: ‘You might have heard that we cancelled the Success Path training tour through Oregon and Washington, as was reported in The Oregonian, due to a vocal group who somehow linked us to the issue of affordable housing. We are very accustomed to being on the receiving end of people’s opinions. My hairstyles, my mothering, and my interior design choices in flip houses — all are discussed. Rent affordability is not a local issue. All across America, and abroad, it is a serious topic worthy of discussion. There is no simple solution to such a complex and sensitive situation. When demand exceeds supply there is tension.’”