May 17, 2017

Well In Excess Of The Desired Equilibrium

A report from CNBC. “The largest generation is finally starting to buy houses. The trouble is, there aren’t enough houses for sale to feed their appetite, at least not enough they can afford. Enter the nation’s recovering homebuilders. They may want to play to this great big audience, but doing that will hurt their bottom lines. First-time buyers, however, are not necessarily starter homebuyers. Millennials waited longer to get married, have children and buy homes, due to the recession and other social factors. Since they are older, they can afford more, even though it may be their first home.”

“‘There are a lot of first-time buyers in their early 30’s in good locations, buying,’ said John Burns, CEO of John Burns Real Estate Consulting. ‘It’s somebody’s first house, but they both went to college, and they’re making $200,000 each.’”

From My San Antonio in Texas. “The local housing market is finally showing signs of cooling after growing at a rapid clip over the last five years. ‘The market is probably slowing down a little bit,’ said Jim Gaines, chief economist at the Texas A&M Real Estate Center. ‘Last year was phenomenally good. You’re still seeing a good market, just not phenomenally good.’”

From The Advertiser in Louisiana. “Acadiana’s housing market is making some measured recovery in 2017. Report compiler Bill Bacque, president of Van Eaton & Romero, said market slowdown exacerbated by the oil and gas industry downturn ‘is at best over or at worst stabilizing.’ Sales of more expensive homes — $300,000 and up — have declined about 8.5 percent, year over year in Lafayette Parish. Only two homes have sold for more than $1 million this year; 26 are listed. No homes in the $900,000 to $999,999 price range have sold in Lafayette Parish in 2017.”

“Bacque said the supply of homes in that $300,000-and-up range is about 11.6 months, ‘well in excess of the desired equilibrium.’”

The Victor Valley Daily Press in California. “A Lancaster man who owns a house in Barstow has started a petition in an effort to change laws to prevent other homeowners from having to deal with any headaches or nightmares associated with trespassers and squatters. While paying his electricity bill for his houses in Lancaster and Barstow on April 28, Alan Frey noticed service was ‘canceled’ at the Barstow location. The confusion prompted him to drive to Barstow. ‘There was a camper out front, pit bulls, mattresses, trash and windows open,’ he said.”

“I called the police. They went in and knocked on the door and the people presented a fake rental agreement with my name on it. … There was no signature on the form. They even claimed they were paying $1,800 a month for rent.’ With the help of police, Frey and the trespassers came to an agreement for them to leave the property by May 1. But after the squatters left later that day, Frey said he was left with a disaster.”

“Frey said he purchased the home June 2001. He expects to pay off the mortgage in June. He said he now intends to sell the house to avoid future headaches.”

The Real Deal on Florida. “Developers sold only 212 units — or less than 1 percent of the pipeline — during the first quarter of this year, as the supply of preconstruction condos slowly gets absorbed, according to a new ISG Miami Report. The majority of developments reported slight increases or no new sales by April compared to ISG’s November report. In the Brickell/Miami River submarket, for example, Rise at Brickell City Centre sold about 20 units during the five-month span. Brickell Ten, Echo Brickell and Cassa Brickell reported stagnant sales.”

“And One River Point, which wouldn’t provide a sales figure in the winter, said it is 15 percent presold. In Miami Beach, Lionheart Capital’s Ritz-Carlton Residences reported the same 60 percent in presales.”

From WOSU Public Media in Ohio. “It’s been 10 years since foreclosures reached a peak in Cuyahoga County. From 2007 to 2015, mortgage foreclosure numbers fell around 63 percent countywide, according to figures compiled by the Thriving Communities Institute. But despite this good news, there are Northeast Ohioans still feeling the aftermath of the crash and the financial instability it caused.”

“About a dozen years ago, Fred Brooks was taking care of his ailing mother. His mother had refinanced her home in Glenville with Argent, one of the biggest subprime lenders in the county. Argent sold her mortgage to Wells Fargo. After she died, the bank foreclosed. But Wells Fargo couldn’t find a buyer at sheriff’s sale. ‘That’s when it got really rough on my end, being that I was unemployed, really didn’t have a way to make property tax payment arrangements,’ he said.”

“The next to foreclose was Cuyahoga County in 2009, a peak year for county tax foreclosures. The county sold his mother’s house. In 2012, the new owner filed to evict him. The attorney he hired to help him has since died. The home is currently valued at $23,100, a bit more than one fourth the size of his late mother’s mortgage. Brooks said he’s stable now, but still wants his mother’s house back.”

“‘Because if I could have found some sort of halfway decent employment, I could have made arrangements to keep it,’ he said. ‘Yes, I would have been broke all the time with paying bills, but it’s a moral value, from where we come from. Like I grew up in that house.’”