April 6, 2017

Everything Is Overpriced, And Returns Are Falling

A report from Multi-Housing News. “More than 11,000 new apartment units are under construction in Northern New Jersey, including 4,800 in Hudson County municipalities Jersey City and Hoboken alone, Yardi Matrix data shows. But the biggest impediment to rent growth in the area is the abundant amount of new supply in New York City, which has led a slowdown or reduction of rents in New York apartment properties and the growing use of concessions. ‘We’re now seeing real pressure on rents,’ said Abe Naparstek, the senior vice president of East Coast development at Forest City Realty Trust. ‘It’s hard to see pressure on rents in New York not affect (Gold Coast) markets in the near term … The next two to three years, it’s hard to imagine there will be a lot of rent growth.’”

The Houston Chronicle. “Houston was called out as an underperforming market for apartment landlords along with some other big cities, a report by John Burns Real Estate Consulting showed. The region’s oversupply of apartments in energy-dependent, higher-end submarkets contributed to a 3.6 percent annual drop in rents in the fourth quarter. Concessions such as free rent with a new lease remain, but landlords are optimistic the worst is behind them, according to the report.”

“Rents in the tech cities of San Francisco and San Jose fell by 2.3 percent and 2.5 percent respectively in the fourth quarter. They’re projected to continue declining over the next several years as a large amount of new apartments are completed this year.”

From Value Walk. “For the last several days I’ve been speaking at an investment conference organized by my friends Robert Helms and Russell Gray. One of the key themes so far in the event is that there are likely problems ahead for the US real estate market. On the first day I had a great conversation with the Chief Economist of Fannie Mae, who was also speaking at the conference. I asked him point blank– what do you think of US housing right now? He answered succinctly: ‘It’s overpriced.’ His presentation went DEEP into the data, showing that US housing is ‘late in the cycle,’ meaning that prices may soon reach their peaks and then suffer a substantial correction.”

“A number of prominent real estate investors and developers have also spoken anecdotally that they’re no longer buying. One gentleman who owns and operates more than 10,000 apartment units told us that he can no longer find any properties that meet his investment criteria. Everything is overpriced, and investment returns are falling. Even more amazing, he told us that banks financed his most recent deals at unbelievable terms– they loaned him hundreds of millions of dollars to fund his real estate projects at just 3%, on an interest-only basis.”

“Think about it– he pays 3% interest, but the money loses nearly 3% of its value each year due to inflation… so essentially the money is zero cost. As I remarked to the audience, the banks are once again putting their customers’ funds at risk and receiving zero return in exchange. This is another sign of a major bubble, similar to what happened ten years ago in the last crash.”

From Lewrockwell.com. “Fannie Mae and Freddie Mac still have housing blood on their hands from the 2008 financial crash. However, the giant GSEs, placed in government conservatorship in September 2008, have now, virtually all by themselves, created another bubble, this time in the multifamily rental market. Fannie and Freddie made 53% of all apartment loans in 2016, that’s down from their combined 68% market share in 2012. So, their conservator, The Federal Housing Finance Agency (FHFA), recently eased the GSE’s lending caps so they can crank out, even more, loans.”

“In a recent press release, Fannie Mae crowed, ‘Fannie Mae (FNMA/OTC) provided $55.3 billion in financing and supported 724,000 units of multifamily housing in 2016 – the highest volume in the history of its Delegated Underwriting and Servicing (DUS®) program.’”

“Cheap interest rates make for low Cap (capitalization) rates and nationwide, ‘Mid-/high-rise cap rates declined to 4.8%, and garden apartment cap rates to 5.6%, both historic lows,’ writes Salmonsen. So, developers can build, lease up and flip projects at sky-high valuations.”

“Real estate profits are irresistible to developers and according to real estate firm Marcus & Millichap, Apartment builders ‘will bring 371,000 units to the market in 2017,’ with project rents expected to rise 3.8% and vacancy by year-end to be 4%.”

“With Clark County Nevada being number three in the nation for in-migration, apartment builders are frantically putting up units and apartment buyers are bidding out-of-this-world prices for units. ‘Overall in Southern Nevada, investors paid an average of $110,111 per unit for apartment complexes this year by the third quarter, up 53 percent from 2015, according to brokerage firm Colliers International,’ the R-J’s Eli Segall wrote late last year. ‘Landlords are betting they can push rents higher in Las Vegas, whose rates trail that of other cities.’”

“But for now, here in Las Vegas, guys like Scott McClave, senior principal of acquisitions and finance at The Bascom Group, see nothing but clear sailing. When asked if the market was overheated, he replied: ‘If you look at the job and population growth, Las Vegas is still not quite building enough to meet that demand.’”

“Are rents getting too high? ‘Today, the average income-to-rent ratio is about 4:1, so it’s pretty easy overall for people to afford rents here. You look at an extreme market like New York or L.A., that ratio is more like 2:1,’ McClave said.”

“When asked if apartment construction will continue, the truth came out. After saying everyone, remembers the crash, and new development is ‘measured,’ McClave admitted, ‘But a builder will never pass on a construction loan. I understand the mentality. The mindset is always, ‘My building will be better, my building will out-lease everyone else’s.’ I don’t fault people for that.’”

“McClave’s company, Bascom, combined with Los Angeles-based Oaktree to pay $38.17 million for the 110-unit luxury complex, or $347,000 per unit, reportedly the most expensive apartment building sale ever in the Las Vegas area, as measured by price per unit.”




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163 Comments »

Comment by Ben Jones
2017-04-06 09:04:46

‘With SoCal rents rising, developers are busy building apartment communities, particularly in Los Angeles. L.A. remains among the top 10 least affordable housing markets in the nation. Despite the issues with affordability and the growing amount of lifestyle supply, we expect continued strong demand.’

‘The pronounced need for housing has resulted in a construction boom, and there are no signs of slowing down. At this point, everyone is trying to get a slice of the action, buying and building along the way.’

 
Comment by Ben Jones
2017-04-06 09:08:19

‘Construction is about 65 percent complete on Lofts at Helmetta, but more than 100 of the luxury townhomes and apartments are already occupied, with another round of leasing set to launch in the next couple months. That lifestyle includes less maintenance compared to owning a home, an on-site saltwater pool and fitness center, and granite countertops and stainless steel appliances inside each unit. Lofts at Helmetta represents just a sprinkle of a trend that has taken New Jersey by storm as the face of the state’s housing market makes a dramatic change, along with their wants and needs.’

‘For years, multifamily housing and apartments had been known to mostly attract people struggling to afford anything else. But driving the rental market today in New Jersey — especially in the area of high-end units — are folks who can easily afford to buy a place to live but are choosing to rent, according to Jeffrey Otteau, president of Otteau Valulation Group in Matawan.’

“It’s the experience they prefer,” he said.’

‘Otteau said similar housing patterns are unfolding in other states along the East and West coasts, but it’s “more exaggerated” in the Garden State, mainly due to the makeup of households.’

‘So with no young ones to care for, or make room for, the “book end generations” are feeling the pull towards luxury rental living. Millennials also place a very high value on mobility; the ability to pick up and move to another location for a job opportunity or to chase a dream is more attainable when renting rather than buying.’

“They are now being built pretty much everywhere,” Otteau said of luxury apartment complexes, noting the trend started in Hudson County. Early adopters include Morristown and Red Bank.’

Comment by oxide
2017-04-07 08:08:47

I think it’s pretty funny that we Gen Xers *still* can’t get no respect. They find a way to ignore even when they’re talking about us. We’re just the generation that gets “bookended” between the more important generations. :roll:

That said, if a baby boomer has enough money to pay rent for 20 years by all means let them rent. But good gosh, who’s gonna rent luxe in Joisey of all places? Those with grandkids 40 miles away in NYC I guess.

Comment by jks3000
2017-04-07 11:25:31

Some of those Jersey City/Hoboken places along the water on the Hudson are cleaner and more livable than places in Manhattan, IMO. They are also connected to the NYC subway (via PATH).

However, I agree, Jersey sucks. As does the whole NYC area. Much rather live down south. I just think that at this point, the Jersey side of the Hudson is a better place to rent in greater NYC. Plus, it’s more tax friendly.

 
 
 
Comment by Senior Housing Analyst
2017-04-06 09:11:05

Monrovia, MD Housing Prices Crater 12% YoY

https://www.zillow.com/monrovia-md/home-values/

 
Comment by Sean
2017-04-06 09:12:15

Vegas has to be a horrible model to try to push rents. After you strip out all of the retail, service and entertainment jobs, what’s left?

Comment by Ben Jones
2017-04-06 09:23:33

Are rents getting too high? ‘Today, the average income-to-rent ratio is about 4:1, so it’s pretty easy overall for people to afford rents here. You look at an extreme market like New York or L.A., that ratio is more like 2:1′

So compare it to “extreme markets” and voila! Government backed loan approved.

Comment by Sean
2017-04-06 09:31:09

Sounds like the same argument I had with a realtor at an open house. “Well, Northern Virginia isn’t high because in Hong Kong it’s REALLY expensive. So compared to Hong Kong it isnt too bad to live here.”

 
 
Comment by Rental Watch
2017-04-06 09:49:03

I once heard that Vegas was great for location global call centers, since with the casinos there are 24-hour services (daycare in the middle of the night, etc.).

However, those are not high paying jobs, and will be among the first to be completely automated.

Comment by Ben Jones
2017-04-06 10:23:43

You can get a pretty nice house in Vegas for 300k.

Comment by Hargert
2017-04-06 10:46:59

The prices in Vegas have been jumping up the last several years and are not showing signs of slowing down. Richmond for new homes has gone from 20k in incentives to less than 5k or none in the last year and a half on new homes. In addition, I have seen prices rise at new developments 10k in two weeks from opening (sound familiar)?

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Comment by aqius
2017-04-06 10:39:19

if you should find yourself in Las Vegas lately . . .

WEAR COMFORTABLE WALKING SHOES. all the pedestrian walkway setbacks for crossing the intersections on the strip will tire you out REAL quick!

just walking down any part of the main drag easily triples your footsteps, since you have to double-back so often on corners.

trade off is there are some humorous oddballs among the panhandlers on the arches.
the cardboard signs are a lively contest for catchy begging / “donation” pleas!

laughed & gave a few guys some bucks for the better ones.

Vegas: everyone should go at least once just for the sheer spectacle.

Comment by new attitude
2017-04-06 15:17:06

The only way to have fun in LV is to drop a dime. Bellagio, Cirque, 4-star eats. AVOID THE SIDEWALKS.

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Comment by taxpayer
2017-04-07 07:19:54

it takes 1/2 hour to go 3 blocks
daytime drunks etc
fck vegas

who would live there?

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Comment by new attitude
2017-04-06 10:56:08

Bring oven mitts for the steering wheel in the summer, like PHX.

Comment by rms
2017-04-07 06:34:21

Haha… so true.

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Comment by new attitude
2017-04-06 11:31:44

Money laundering, prostitution, mafia games, drugs, rehab centers, runaway shelters….

 
 
Comment by Ben Jones
2017-04-06 09:12:56

‘Lots of condos and new apartments, like Edison Midtown on Central Avenue, are going up in metro Phoenix, but most are too expensive for many millennials. A new study out by ABODO, an online apartment-hunting site, ranks 40 major U.S. metropolises by how well millennials are doing, by which we mean how many can afford to live on their own and how many are roosting back with mom and dad. Valley moms and dads may be surprised to learn they are making out better than the national average.’

‘For those lucky enough to work, how are their paychecks? The national average monthly income for millennials is $2,023. In Phoenix, it’s $2,045, earning our millennials a rank of 27th. The top two will surprise none of you: San Jose at $2,980, followed by San Francisco at $2,813. Worst? Right again. Riverside, where millennials bring home $1,784 a month.’

‘You don’t need an advanced degree to know that if rent is high and incomes are low, you’re more likely to move back in with the ‘rents. Nationally, millennials are paying 47 percent of their monthly pay to the landlord. Phoenix is a tick worse, at 48 percent and a ranking of 19. California millennials are getting clobbered. Four of the five least expensive places are the Golden State For Landlords, with San Diego millennials forking over a staggering 70 percent of their income for a roof.’

Comment by snake charmer
2017-04-06 11:10:05

“You don’t need an advanced degree to know that if rent is high and incomes are low, you’re more likely to move back in with the ‘rents.”
__________________________/

Hmmm. From Ben’s daily submissions here, it seems like plenty of people with advanced degrees working in policymaking positions for private banks or the federal government don’t know that.

Our national goal is for every young person to spend 100% of his or her disposable income on housing, healthcare, student loan interest, and smart phones.

Comment by Carl Morris
2017-04-06 11:16:17

Our national goal is for every young person to spend 100% of his or her disposable income on housing, healthcare, student loan interest, and smart phones.

I wouldn’t call it a national goal. I’d say it’s more like a pack of hyenas trying to steal from your lifetime productivity pile, each trying to get in and get a big piece ahead of the others. The student loan hyena has gotten very good at what he does…leaving less for the housing hyena. In the meantime healthcare and smart phones are trying to get in and get a piece even before you leave for college.

Comment by new attitude
2017-04-06 15:22:45

If only millennials were not forced into those payments. geeez, so many victims.

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Comment by snake charmer
2017-04-07 08:52:04

An excellent point. But it takes a very strong and independent individual to reject those things.

 
 
 
Comment by Ben Jones
2017-04-06 11:19:24

I’m a landlord and I’m concerned if rents push 30% of income. At 50% I’d be terrified. Why? Tenants of any age have cars break down. Get hurt or sick. Lose jobs, get divorced, you name it. Yet here they are, widely proclaiming the system is flimsy, broken and beyond a frenzy. One recession and the whole thing blows up, like greater Houston, where we read recently there are 58,000 apartments on the way.

Comment by Rental Watch
2017-04-06 13:00:15

In markets where rents have driven to 50% of income, there is clearly a large amount of demand relative to supply…in such cases, landlords care less if you run into hard times and can no longer pay the rents. There will be someone else to move into the vacant units.

In other words, if you were in a market where rents were 50% of income, you would be less terrified.

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Comment by Race Bannon
2017-04-06 13:06:54

Hey Jonesy…. I bet you’re sure glad my good friend Rentalwatch is here advising you..

 
Comment by Ben Jones
2017-04-06 13:10:24

I guess you haven’t done much land-lording then. The biggest expense is vacancy. These rents are what’s driving the oversupply. Oversupply plus stretched tenants equals disaster. Don’t get me wrong: I’m counting on people like you to be complacent about it, like almost everyone is.

 
Comment by Rental Watch
2017-04-06 13:38:05

I have precisely $0 invested in apartments, directly or indirectly–I’m nowhere close to complacent–I’ve stayed away because the yields have simply been too low.

That said, I know people who have owned apartments for decades in markets in Silicon Valley, where lack of supply over years has maintained upward pressure on rents.

All else equal, an additional $50 in rent on a $1,000 unit is worth $8,500 in capitalized value at a 7% cap (and much more at a 5% cap). It DOES make economic sense to push rents a bit, even if it means having slightly longer downtime between tenants.

Landlords with lots of units understand the negatives of vacancy, but they also have a HUGE window into the market. There are always people leaving for reasons other than financial hardship.

If the market is such that a typical vacant unit is met with 10 applications within 24 hours, the landlord will push your rents on renewal considerably and be willing to accept vacancy if they lose the tenant.

If the market is such that a vacant unit is met with 1 application in a week, they won’t push nearly as hard on your renewal, and will do whatever it takes to keep you.

 
Comment by Ben Jones
2017-04-06 15:20:49

‘if you were in a market where rents were 50% of income, you would be less terrified’

I was thinking about this and want to expand. I’m not picking on you, but it highlights loopy new paradigm thinking. Every time I have a vacancy I’ll get applications from people wanting to pay 50% or even 70% of their gross income in rents. I wait until I find someone who can afford it: I’ve learned the hard way. Now I could quickly fill every vacancy with these people and shazaam! I’ve got San Diego renters!

Why don’t I? They are a bigger risk to expand my largest expense: vacancy. More than a risk really, a certainty. So these are probably averages. That means a significant number of renters in San Diego are paying more than 70% of their income in rents! Sure, some number of them can afford the rent, but the vast majority are one car repair from eviction.

I’ll use a rare analogy: I can make shack loans with people using 70% of their income for the payment. If they default, I’ll simply foreclose and sell it again. Genius!

This is all part of that story apartment guys have invented: remember the Atlanta guy bragging that millennials are “willing” to pay 60-70% and more in rent, like he discovered a new element or something. Hey braniac, I’ve got people sending me applications just like that for every vacancy. It isn’t a sign of strength, your product is too expensive for the market.

You may remember the other day an Oregon poster with new owners lowered the rent from $1600 to $1200. That ladies and gentlemen, is an apartment sized a$$-pounding.

 
Comment by Karen
2017-04-06 17:15:47

In markets where rents have driven to 50% of income, there is clearly a large amount of demand relative to supply…in such cases, landlords care less if you run into hard times and can no longer pay the rents. There will be someone else to move into the vacant units.

In many states if tenants stop paying and don’t move out voluntarily, you may be waiting a long time until that unit is actually vacant. And good luck recovering the rent that wasn’t paid during that whole time, even with a court judgment.

 
Comment by Crow Breath
2017-04-06 17:39:49

Hey Ben,

I checked again the next day, it was actually $1600 down to $1300 for my top-floor 3/2, as of today. (The lower floor units are $100 less, appx.) I signed the original lease last June. I still have a couple of months left remaining on it. I’m hoping the price stays at $1300 until then.

Another thing that was a little bit odd.. the manager made it a point to tell me that they are now very flexible on lease durations, they will gladly do a 6-month, or 3-month. She just offered that up for no reason. To me, it tells me the rental market is weakening in my area.

 
Comment by new attitude
2017-04-06 17:43:21

then there are the tweakers who will burn the place down.

 
Comment by Crow Breath
2017-04-06 18:00:50

new attitude, you are right. They raid the dumpsters here. I can see ‘em from my window. It’s pretty sad. Rail-thin white guys, they look like ghosts, and they are not shy about it. Not even wearing any protection, they jump right in with bare hands and arms and tear open all the garbage, looking for anything.

 
Comment by Ben Jones
2017-04-06 18:12:57

‘If the market is such that a typical vacant unit is met with 10 applications within 24 hours, the landlord will push your rents on renewal considerably’

I get these kind of applications, and I don’t raise rents. Because it’s a place I don’t want to go. And this isn’t happening in a vacuum. A 40 year high in apartment construction: 62 years in Boston, 72 in San Francisco, and it’s almost all luxury. Combine that with the explosion of value add rent jacking in older complexes, and there’s the rising rents. People don’t have an option. But that’s changing big time.

 
Comment by Prime_Is_Contained
2017-04-06 23:50:50

These rents are what’s driving the oversupply.

Ben, I respectfully disagree–the oversupply is driven by the Fed’s interest-rate manipulation.

Money desperately looking for a place to earn a yield drives market valuation for property through the roof, and then the cap-rate demands a certain rent to support that valuation…

 
Comment by who cares?
2017-04-07 06:48:41

Disagree-

It’s driven by inexperience and speculation.

For a couple decades now, amateurs who think they know what they’re doing(easy for this to happen when you have a pile of lender cash or other peoples money) have been interfacing with a business(contracting) in which >the contractor< can a) make a killing or b) lose his ass. If you’re going to a contractor and handing him a set of drawings and specifications and asking for a price without any knowledge and background, you’re going to pay and pay big and not know it. But when it comes to lender funded work or other peoples money, who cares right? Who cares when it just gets passed along as higher rent. Wrong. Trees don’t grow to the sky. By this time, the investor is screwed, the contractor earned buckets money and you’ve priced your product out of the market and your end product is cash flow negative from day 1. And let’s get right down to brass tacks here…. ‘the market’ for the product we’re discussing is predicated on wages that aren’t all that different anywhere. That goes for the product too.

Too many people involved in project development who couldn’t procure a $20 item without driving the cost 5x higher.

 
 
 
 
 
Comment by Ben Jones
2017-04-06 09:35:38

‘One gentleman who owns and operates more than 10,000 apartment units told us that he can no longer find any properties that meet his investment criteria. Everything is overpriced, and investment returns are falling. Even more amazing, he told us that banks financed his most recent deals at unbelievable terms– they loaned him hundreds of millions of dollars to fund his real estate projects at just 3%, on an interest-only basis.’

Here’s the thing: this guy can’t make money borrowing at 3%. But most people can’t borrow at anywhere near that. It’s more like 7-10%. You routinely see cap rates at 6 or 7%. Meaning they are losing money, every day. This at a time when renters and rents have never been higher.

‘The net operating income formula is calculated by subtracting operating expenses from total revenues of a property. The operating expenses in the NOI formula consist of all necessary expenses associated with the revenue generating activities. Keep in mind that there are several different expenses that are not included in this category like income taxes and interest expense.’

The only reason to borrow and buy apartments in this climate is if you expect to sell it (or refinance, which many are doing as often as possible) for a lot more.

Comment by Rental Watch
2017-04-06 09:55:49

You don’t amass 10,000 apartments without being extremely shrewd. I’m sure he could find apartments to buy at a yield where he could get positive leverage with 3% debt (ie. make money), but they probably fail on a lot of metrics that he sees as important to be able to survive the next downturn.

If you have a reasonable down payment, most apartment investors can borrow at far less than 7-10%, which is why cap rates are still sub-7%.

Comment by Ben Jones
2017-04-06 10:12:12

Here’s the shrewd money:

Sam Zell Edges Out of Apartments - WSJ
http://www.wsj.com/articles/sam-zell-edges-out-of-apartments-1445832247
Oct 26, 2015 - Sam Zell has agreed to sell more than 23,000 apartments controlled by his real-estate company, Equity Residential, for $5.4 billion to Starwood …
Why Is Sam Zell Selling $6 Billion Worth of Apartments? - Income …
blogs.barrons.com/…/2015/10/…/why-is-sam-zell-selling-6-billion-worth-of-apartmen…
Oct 26, 2015 - It is also selling another $700 million in apartments over the course of … magnate Sam Zell is unloading a quarter of his apartment holdings.
Billionaire Sam Zell sells off $1.4 billion worth of metro Denver …
http://www.bizjournals.com/denver/…/real-estate-mogul-sam-zell-sells-off-10-metro.html
Real estate mogul Sam Zell sells off $1.4B worth of metro Denver apartments. Feb 4, 2016, 12:29pm MST Updated Feb 10, 2016, 1:32pm MST. Industries …
Starwood to buy apartments from Zell’s Equity Residential - News …
http://www.chicagobusiness.com/…/equity-residential-to-sell-chunk-of-apartments-for-5-37...

Zell’s Equity Residential sells 23K apartments - MarketWatch
http://www.marketwatch.com › Industries › Construction/Real Estate
Oct 26, 2015 - Sam Zell has agreed to sell more than 23,000 apartments controlled by his real-estate company, Equity Residential, for $5.4 billion to Starwood …
Peak Housing 2.0: Sam Zell Dumps 23,000 Apartments In 2007 Deja …
Jan 28, 2016 - In the billionaire’s latest recession-prep selloff, Sam Zell’s Equity Residential just unloaded 23,262 apartments in a $5.4B sale to Starwood …

Comment by Ben Jones
2017-04-06 10:19:20

‘October 26, 2015′

‘Why Is Sam Zell Selling $6 Billion Worth of Apartments?’

‘Real estate magnate Sam Zell is unloading a quarter of his apartment holdings. His real estate investment trust, Equity Residential Properties (EQR) announced it is selling $5.3 billion in apartment properties to Starwood Property Group. It is also selling another $700 million in apartments over the course of 2016.’

‘Wall Street analysts cheered the move, which they say improves the quality of EQR’s real estate portfolio. But they note it also raises questions about whether the outlook for apartment properties — especially in the regions the firm is selling — is about to take a turn for the worse.’

‘Another question: Why is EQR paying a special dividend instead of buying more properties?’

‘Equity Residential says asset sales are part of a plan to focus on top-tier urban downtown assets. David Neithercut, the REIT’s CEO said in the release: “This is an extremely opportune time for Equity Residential to monetize our investments in this portfolio of assets. In doing so, not only have we demonstrated the enormous value created for our shareholders through the realization of an unlevered internal rate of return of 11.1%, but we have also narrowed our focus which will now be entirely directed towards our core, high-density urban markets that will fulfill our strategic vision and drive EQR performance for many years to come.”

‘EQR shares were up 2% to $81.11 on Monday just before 2 p.m. ET. The REIT has a current yield of 2.8%.’

EQR this morning: $63.

https://search.yahoo.com/search?p=EQR&fr=uh3_finance_vert&fr2=p%3Afinvsrp%2Cm%3Asb

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Comment by taxpayer
2017-04-06 10:43:09

he sold early
If Sam sells you better be too

 
Comment by Ben Jones
2017-04-06 10:51:17

Yield 2.8%. Loses 25% of stock price in two years.

 
Comment by Race Bannon
2017-04-06 11:08:00

Now thats what I call losing your ass. Here we are 18 months later….. 18 months lower….. and falling.

 
Comment by aqius
2017-04-06 13:00:18

maybe Sam Zell had his “shoeshine boy” moment in an Uber car in a rarity when his usual conveyance was not available.

 
Comment by Professor Bear
2017-04-07 07:29:34

When you are invested in a Ponzi scheme, getting out first at the point when nobody else realizes the problem is of utmost importance.

 
Comment by Puggs
2017-04-07 09:55:52

You know we’ve hit the top when Uber drivers are giving investment advice.

 
Comment by redmondjp
2017-04-07 15:23:02

LOL! And you get medical tips from the Lyft drivers, heh heh.

 
 
Comment by Rental Watch
2017-04-06 13:08:21

Zell sold 25% of the apartments EQR owned…the last time he made such a bet on a market turning, he sold ALL of Equity Office Properties.

He didn’t make a bet against all apartments (or he would have sold all of EQR. The apartments that Zell sold were suburban, keeping the downtown urban properties.

We are reading all about the carnage in downtown locations. I recently read how suburban rents are rising faster than urban, with Riverside/San Bernardino having rents rising the fastest in the country, at 7% Y-o-Y.

Remember, on the other side of the trade was Barry Sternlicht of Starwood, who isn’t stupid either.

At this point, the data does not appear to show Zell being on the good side of this trade. Long term, that may very well be different.

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Comment by Ben Jones
2017-04-06 13:13:20

‘keeping the downtown urban properties…We are reading all about the carnage in downtown locations’

He should have sold everything. Had he been reading this blog it could have saved him a few billions. EQR was extremely bullish on San Francisco in the first quarter of 2016. By the second quarter they were reporting falling rents.

 
Comment by Karen
2017-04-06 17:19:07

We are reading all about the carnage in downtown locations. I recently read how suburban rents are rising faster than urban, with Riverside/San Bernardino having rents rising the fastest in the country, at 7% Y-o-Y.

If he’s so smart, and if suburban rents are rising faster than urban, then why would he sell the suburban apartments? As usual, your “explanation” makes no sense.

 
Comment by Blue Skye
2017-04-06 17:25:35

Just because it’s big doesn’t make it smart.

 
Comment by scdave
2017-04-06 18:19:43

If he’s so smart, and if suburban rents are rising faster than urban, then why would he sell the suburban apartments? As usual, your “explanation” makes no sense ??

lOL. Your question shows your lack of experience and knowledge. You sell when rents are going up not down. Funny

 
 
 
Comment by mwr
2017-04-07 16:18:16

Are most construction loans at Prime +??

 
 
 
Comment by palmetto
2017-04-06 09:46:28

It’s much worse in Miami than the industry numbers would show. SHOCKER!!

“What is driving real estate agents crazy is that the local and national real estate associations keep on putting rosy reports out there saying “prices up 7% this month, etc.” but then the agent has to explain to their client that the pricing in their condo building is actually down 20% over the last 18 months with a 5-year supply of units listed for sale.

Most people who make the decision to sell cannot wait five years to find a buyer, which means they have to price the unit at the low end of the market to get their unit sold, which explains a lot about why prices are falling in this market with surging inventory.

The rosy reports might be true in the aggregate, but they mask the distress in certain segments of the market, which makes for painful conversations between real estate agents and their clients.”

http://www.zerohedge.com/news/2017-04-05/miami-condo-implosion-much-worse-industry-numbers-reveal

Comment by Ben Jones
2017-04-06 10:22:15

They use MLS for inventory, but developers don’t list everything they have for sale. It’s something like 20 years of inventory above 5 million.

 
 
Comment by Larry Littlefield
2017-04-06 10:04:07

If new supply brings down rents, I say bring it on. Vacancy has been very low by historical standards, and rent increases high.

My bubble concern in multifamily is the cost of development sites, which limits the ability to provide new supply at the price points where the excess demand is.

Comment by Race Bannon
2017-04-06 10:08:43

What “excess demand”?

 
Comment by Ben Jones
2017-04-06 10:49:04

‘which limits the ability to provide new supply at the price points where the excess demand is’

“100 year flood” of apartments. Downtown supply to increase 25%.

http://www.seattletimes.com/opinion/seattles-build-baby-build-frenzy-leaves-affordability-in-the-dust/

 
Comment by butters
2017-04-06 11:00:05

What vacancy? Is there a data about electric and water usage?

Fake Fake and Fake vacancy reports.

Comment by Ben Jones
2017-04-06 11:10:58

1 - 120 / 2500

https://seattle.craigslist.org/search/hhh?query=free+rent&availabilityMode=0

Chosen at random:

‘$1345 / 2br - 840ft2 - Lowered RENT and 1st Month FREE!!! Don’t miss out!!!! (Silverdale, Bremerton,Gig Harbor,Poulsbo, Keyport,Port Orcha)’

https://seattle.craigslist.org/kit/apa/6048389377.html

Comment by Yaan
2017-04-06 12:21:50

You are cherry-picking a little here. Despite being geographically close to Seattle, it’s separated by a body of water that makes it an impractical place to live. Mr. Google Maps tells me it’s a 90 minute commute to Amazon headquarters. That’s on a good day.

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Comment by Ben Jones
2017-04-06 12:33:52

OK, go pick one of the thousands for yourself.

 
Comment by aqius
2017-04-06 13:01:54

they had me sold at the first set of !’s

 
Comment by butters
2017-04-06 13:14:28

Does everyone in Seattle work for AMZN?

Man no wonder jobs are so dire…..LOL

 
 
 
 
 
 
Comment by Senior Housing Analyst
2017-04-06 10:50:24

Attleboro, MA Housing Prices Tank 19% YoY On Cratering Housing Demand

https://www.zillow.com/attleboro-ma/home-values/

Comment by SuzeB
2017-04-06 16:49:47

Attleboro, the Athens of Massachusetts! Say it isn’t so….

 
 
Comment by Ben Jones
2017-04-06 10:55:16

‘The days of coffee shops, boutique stores, and one of a kind restaurants have been good to Santa Barbara over the years. These days, it’s hard to tell if that is a sustainable business plan anymore for some owners. Commercial real estate brokers are pounding in their signs at many locations, about 45 according to one longtime agent, right in the State St. corridor and surrounding streets.’

‘It is similar to the recession years, except the economy now is much stronger. How can this be?’

‘Maggie Campbell with the Downtown Organization told the Santa Barbara City Planning Commission recently, a study is underway to find out what is causing the slump. Already there are indicators that tourists and teens have been a targeting audience in recent years - something that may not be working anymore.’

“We are seeing a serious change in our retail mix and a serious exodus of traditional users that we have never seen before and I don’t see that in other cities at the same rate,” said Campbell.’

‘A resident and vendor Martin Irabien says “the (landlords) should be less greedy.” He recalls smaller stores years ago with lower rents and longer occupancy.’

Comment by new attitude
2017-04-06 10:59:55

Yep, lots of vacancies on State St. Not sure who is gonna take over Macy’s. Now that the cruise ships stop there, locals avoid downtown on weekends.

Comment by junior_kai
2017-04-06 15:49:29

Cruise ships to SB? Where do they dock?

I’m guessing all the places on State will end up becoming chain dives like hooters and hard rock cafe. What a mess.

Comment by new attitude
2017-04-06 15:56:32

http://santabarbaralocal.com/2017-cruise-ship-landings/

2017 Cruise Ship Landings - shuttle into town to buy t-shirts

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Comment by Carl Morris
2017-04-06 11:22:23

‘It is similar to the recession years, except the economy now is much stronger. How can this be?’

Who are you going to believe…whoever told you the economy is much stronger? Or your lying eyes?

Comment by new attitude
2017-04-06 11:29:21

Record corp profits must be an indication of something good. Or is making more money bad?

That 6-7 yrs run has ended though, time to slide downhill for a while.

Comment by Carl Morris
2017-04-06 12:09:14

Are record corporate profits the definition of a strong economy? I never thought so but your response made me realize that could be your definition.

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Comment by oxide
2017-04-06 14:21:57

New attitude (the old CaliforOH poster) is being sarcastic. Yes you would *think* that a strong middle class and fewer poor people would be an indication of a strong economy. But corporate profits are the definition of a strong economy for the 1%, the stockholders, and for the globalists. And these days since it’s the globalist millionaire wags on the media and CEOs are beholden to stockholders, Corporate Profits win the day.

 
Comment by Race Bannon
2017-04-06 14:45:06

Hey Donk.

 
 
 
 
 
Comment by Ben Jones
2017-04-06 11:02:26

‘The other side of “flip it”

‘By Lynda Whalen, Special to The Commercial Appeal’

‘I read The Commercial Appeal’s Tom Bailey’s article (“Real estate – City No. 1 in house flipping – 11.7% of Memphis area’s homes sold within 12 months, survey says; Clarksville ranks No. 2,” March 19) and thought: “Wow we have gone from striving to be bring back the “city beautiful image” we had to “let’s just finish off the neighborhoods.”

‘The thing that was foremost on my mind was how do we stabilize and sustain neighborhoods with rental property and a constant turnover of occupants?’

‘As chairwoman of the Southeast Memphis Neighborhood Partnership, I represent 31 Neighborhood Associations. Most of these falls under the “swing” category, which means they could fall either way.’

‘The housing crisis was not the only issue that neighborhoods have faced over the past 15 or so years. We have had to adjust and absorbed an array of issues – relocation of tenants from Hope VI projects, Katrina victims, shadow inventory property, absentee investors and owners simply cutting their losses and moving on.’

‘For years, we have tried to encourage investors and/or property management companies to include the top-ten code violations in their leases, as well as lawn care. Most tenants do not arrive with lawncare equipment and are not likely to purchase it. Thus, the street appeal of rental property is lacking, bringing down the neighborhood.’

‘Bailey’s story was full or statistics. Here are some of ours: Take a drive down Perkins from Quince to Park and see the yards that are now paved with concrete. That will stop the parking on the grass issue, but the street looks like a parking lot. This is in Colonial Acres.’

‘Travel down White Station between Quince and Park in Sea Isle and it is house after house of unkempt yards, cars in the yard, carport stacked with junk and so on.’

‘Head toward the Cherry/Kimball area and go down Boyce, Oakridge, Fizer. You will see boarded houses, tires, cars in the yard, trash, dogs tied to front doors.’

‘And we should embrace investment owned property? Some would say we should be grateful that abandoned and boarded houses have been bought and are now on the tax roll. That is true to a point, but when that property has constant evictions, or they are running an auto repair shop or unlicensed day care, or 15 people are living in a three-bedroom house, that is not our version of home improvement.’

‘I wonder if that investor wants to live next to one of his/her rentals?’

‘We do have some savvy investors. Most do not like being approached by neighborhood associations and have their own set of rules. They hide behind their LLC status and say catch me if you can.’

‘One of the saddest parts of the mindset of some investors is that they prey on those that are already down on their luck because of poor credit or running from an abusive relationship. So, they do not do a background check and raise the rent.’

‘If they could not pay rent before why would you think they would pay it now and pay more? This is setting people up to fail.’

Comment by oxide
2017-04-06 14:26:40

“The members of the Southeast Memphis Neighborhood Partnership know all too well we cannot stop the wheels on the investor band wagon, but we would like to see a change in how they operate and maintain their property. A mentoring approach to their tenants could maybe turn some into tomorrow’s homeowners. That would be a great n investment.

Investors mentoring their tenants to be better people and someday be homeowners? Good lord what is this woman huffing.

Comment by Crow Breath
2017-04-06 15:51:14

Mentoring. Maybe they are teaching people how to falsify loan documents without getting caught, or how to launder money.

 
 
 
Comment by Senior Housing Analyst
2017-04-06 11:11:25

Hoboken, NJ Rental Rates Plunge 7% YoY On Skyrocketing Inventory

https://www.zillow.com/hoboken-nj/home-values/

 
Comment by Crow Breath
2017-04-06 12:51:27

There are so many sarcastic things one could say about this. Those people are so far gone mentally… “Everything is racist!”

http://www.straight.com/news/890816/one-five-bc-citizens-emails-province-about-real-estate-expressed-racism-towards-asians

Comment by Crow Breath
2017-04-06 13:14:51

That 15% foreign buyer tax is clearly a Hate Law.

It is a Hate Law because people hate it when a bunch of foreigners buy up all their property.

 
Comment by Crow Breath
2017-04-06 13:31:09

Sorry, replying to myself again, but how was it even possible that the B.C. government successfully passed a tax on foreign buyers? You would think the leftists would have gone crazy with the racist card. What’s up liberals, is it racist or not?

Comment by MightyMike
2017-04-06 15:15:50

If race is not mentioned in the law, just citizenship, then the law is not racist. A sixth-grader should be able to figure that out.

Comment by Crow Breath
2017-04-06 15:47:50

It is clearly intended for Chinese foreigners, even if it doesn’t state it outright.

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Comment by MightyMike
2017-04-06 17:26:39

I doubt that the population of British Columbia would be any happier if non-Chinese people were driving up the cost of housing.

 
Comment by MightyMike
2017-04-06 17:40:48

The foreign part is the important point. A large portion of the provincial population is made up of Chinese-Canadians, who are not affected.

 
 
Comment by Albuquerquedan
2017-04-06 15:48:45

So a law that does not mention Muslims but just excludes them by nationality is not anti-Muslim?

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Comment by MightyMike
2017-04-06 17:24:38

I can’t tell if you’re referring to a hypothetical law or Trump’s executive orders. If you’re referring to an immigration law that banned all people from Muslim countries, it would be reasonable to assume that anti-Muslim sentiment was the motivation, given current attitudes.

 
Comment by Obongo
2017-04-06 23:08:49

So the fact that the Obama administration put 7 predominantly Muslim countries on an anti-terror watchlist has to do with ‘anti-Muslim sentiment”? Makes perfect sense. Because it DEFINITELY couldn’t have had anything to do with terrorism, right?

 
Comment by Albuquerquedan
2017-04-07 09:23:06

it would be reasonable to assume that anti-Muslim sentiment was the motivation, given current attitudes

That is not the legal standard and now that there are five justices on the Supreme Court that actually try to apply the existing law and not make law that they like, we will soon see the Trump orders upheld.

 
Comment by MightyMike
2017-04-07 09:48:28

I wasn’t referring to the law.

 
Comment by Albuquerquedan
2017-04-07 10:06:30

I wanted to post this under where I posted about homeless but the post has not appeared, so I will post it here:

O’Connor v. Donaldson, 422 U.S. 563 (1975), was a landmark decision in mental health law. The United States Supreme Court ruled that a state cannot constitutionally confine a non-dangerous individual who is capable of surviving safely in freedom by themselves or with the help of willing and responsible family members or friends. Since the trial court jury found, upon ample evidence, that petitioner did so confine respondent, the Supreme Court upheld the trial court’s conclusion that petitioner had violated respondent’s right to liberty.[1][2][3]

This case is the primary reason why we have so many mass shootings and homelessness. While it seems reasonable, when you realize how non-dangerous is defined you see the problem. If a person is on his or her meds he or she is often considered non-dangerous. Once off his meds he often because extremely dangerous but the mental health authorities and the courts are only looking at his condition when he is on the meds. Everyone knows how often these people go off their meds but legally we ignore it, hence mass shootings and mass homelessness. Building more houses will never cure our homeless problem even if they are reasonably priced since this is not an economic problem. Similarly, restricting gun sales to law abiding people is not the answer to mass shootings.

 
Comment by Albuquerquedan
2017-04-07 10:09:30

Fine Mike, but it does not change the fact that Trump’s orders were lawful under existing precedent, it is just they were appealed in a circuit that gets reversed 80% of the time because the courts in that circuit do not follow the law, they make their own law.

 
Comment by MightyMike
2017-04-07 10:22:23

That mental health decision appears to be inspired by the Magna Carta, rather than Hollywood. You sometimes read about regimes like China that lock up dissidents with any due process. The expression used in the papers is “held without charge.” It appears that the decision reduced the number of Americans held without charge by their government.

 
Comment by MightyMike
2017-04-07 10:26:09

the courts in that circuit do not follow the law, they make their own law

That’s what people say when they don’t like a decision of a court. It’s a lazy argument.

 
Comment by Albuquerquedan
2017-04-07 10:36:04

No it is a fact that the Ninth Circuit decisions get reversed 80% of the time when the Supreme court reviews them.

 
Comment by Albuquerquedan
2017-04-07 10:42:47

Don’t let the facts confuse you Mike:

http://www.snopes.com/ninth-circuit-court-most-overturned/

 
Comment by MightyMike
2017-04-07 10:55:36

That doesn’t mean that they make their own laws. It just means that the Supreme Court frequently disagrees with their decisions.

 
Comment by Albuquerquedan
2017-04-07 11:48:10

A distinction without a difference, as we say in the biz.

 
 
Comment by Crow Breath
2017-04-06 16:04:27

> “If race is not mentioned in the law, just citizenship, then the law is not racist.”

So, what about the immigration laws? If we try to enforce them, some people say that is ‘racist’. Is it?

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Comment by MightyMike
2017-04-06 17:15:10

It’s not inherently racist. You probably can’t find too many people who say that it is. On the other hand, the people who most fervently want the law to be enforced tend to think of illegal immigrants as being mostly a different color than themselves, statistically speaking.

 
Comment by Crow Breath
2017-04-06 18:17:14

Cool. About the Canada tax, I agree it’s not racist in the sense of ethnicity, it is targeting the nationality of origin, which happens to be for a country that is very highly homogeneous ethnically, so sometimes I think of them as the same thing, which is probably wrong.

 
 
Comment by Crow Breath
2017-04-06 16:25:08

Hey MightyMike… For record, it would not have bothered me in the least if the BC government did call it, explicitly, right in the title, “The Foreign Chinese Real Estate Tax”. Let’s call a spade a spade. That’s what it is.

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Comment by new attitude
2017-04-06 17:39:05

The Foreign Chinese Real Estate Tax”

All 190 countries should adopt this at 25%. Let em live in dirty China.

 
 
 
 
 
Comment by Senior Housing Analyst
2017-04-06 13:23:51

Kirkland, WA Housing Prices Plunge 9% YoY As Housing Correction Gains Traction

http://www.movoto.com/kirkland-wa/market-trends/

 
Comment by Rentor
2017-04-06 13:30:31

After many years I drove through Oakland CA and I was surprised and saddened to see so many homeless people who had setup tents on the street. Just wondering when did we become a third world country?

Comment by palmetto
2017-04-06 13:54:40

I’m not really sure, but my best guess is that it started in earnest during the Bush 2 regime.

 
Comment by butters
2017-04-06 14:02:38

Ray-gun & Greenstain

Comment by MightyMike
2017-04-06 15:20:56

The problems started in the 70s, but the steepest decline was during the Reagan years.

Comment by rms
2017-04-07 06:56:10
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Comment by new attitude
2017-04-06 15:18:43

You should see skid row in Los Angeles. I wish the churches would step up, they claim they do.

Comment by JSandusky
2017-04-06 15:50:28

my peeps.

 
 
Comment by junior_kai
2017-04-06 15:45:28

Nope, youre all wrong. Kicked off in 1971 when we went off the gold standard. The decline has waxed and waned at various times, but once you base your money on nothing, its all over but the crying.

Comment by rms
2017-04-07 06:58:47

“Kicked off in 1971 when we went off the gold standard.”

+1 Indeed.

“The post-war period from 1945 to 1973 was the era of the Bretton Woods system of fixed exchange rates and capital controls. It was a time of rapid economic growth in the rich world as countries rebuilt themselves after the war and as the technological innovations of the first half of the 20th century—cars, televisions, and so on—came into widespread use. High taxes reduced inequality; fiscal policy was used to control the economic cycle. It all came crashing down in the early 1970s as the fixed-currency system collapsed, and an oil embargo imposed by Arab producers ushered in stagflation (ie, high unemployment combined with inflation).” —Buttonwood

 
 
Comment by Michael Viking
2017-04-06 16:03:52

I know there’s a lot of smart people on this blog who have already blamed it on this president or that president. I’m going to differ and say it’s due to getting rid of the vagrancy laws in the late 60s and early 70s around the country. These people used to get locked up.

Comment by Race Bannon
2017-04-06 16:07:37

Nonsense.

These problems that have expanded exponentially are directly the result of rigged markets and fixed prices at grossly inflated levels.

When the interferences to prices and markets are removed, things get better very very quickly.

 
 
Comment by phony scandals
2017-04-06 17:35:40

“Just wondering when did we become a third world country?”

You mean…

Lyndon Johnson’s “Great Society”

Johnson also signed the omnibus ECONOMIC OPPORTUNITY ACT OF 1964. The law created the Office of Economic Opportunity aimed at attacking the roots of American poverty. A Job Corps was established to provide valuable vocational training.

Head Start, a preschool program designed to help disadvantaged students arrive at kindergarten ready to learn was put into place. The VOLUNTEERS IN SERVICE TO AMERICA (VISTA) was set up as a domestic Peace Corps. Schools in impoverished American regions would now receive volunteer teaching attention. Federal funds were sent to struggling communities to attack unemployment and illiteracy.

http://www.ushistory.org/us/56e.asp

Comment by MightyMike
2017-04-06 17:43:39

Yeah, that’s it. It was vocational training. Maybe the problem started back in the fifties when that newfangled rock and roll music got started. A lot of people thought that the communists were behind it, but no one listened.

Comment by scdave
2017-04-06 18:23:43

+1

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Comment by phony scandals
2017-04-06 19:23:17

“I drove through Oakland CA and I was surprised and saddened to see so many homeless people who had setup tents on the street.”

That must be where people live while being cared for from cradle to grave .

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Comment by Albuquerquedan
2017-04-07 09:42:47

When we emptied out our mental asylums we filled our streets with homeless. It was all due to a Supreme Court decision. I guess we can thank Hollywood for all the movies telling us just how bad the mental asylums were. Hollywood seems to inform the liberal justices on the law since to them it is a “living constitution” and Hollywood seems to be were they look to see current societal views. Now the mentally ill have the ‘”right” to freeze on the streets and rape and kill each other and anyone else foolish enough to cross their paths.

 
 
 
 
 
Comment by phony scandals
2017-04-06 16:33:20

A week or two ago I said that everywhere is a dump, you just need to know where to look.

https://greenwichfreepress.com/news/government/a-peek-at-living-conditions-inside-the-peck-and-armstrong-court-55684/

Comment by Crow Breath
2017-04-06 16:52:09

That is all government housing. “HUD Subsidized Developments”. Jeeze. That is what we get for our money?

 
Comment by Karen
2017-04-06 17:42:13

There is plenty of non-subsidized rental housing that isn’t in much better condition. And people pay full price for it! I’m sure this is why Ben receives applications from people willing to pay extraordinarily high percentages of their wages on rent. Below a certain price point, you can’t find anything decent.

 
Comment by Young Deezy
2017-04-07 07:57:43

This is somewhat ironic to me given a large number of government apartments near me were/are MUCH nicer than anything I lived in when I was still doing the apartment life thing. Any of the damage to them was inflicted by hoodrat tenants who didn’t know to treat the property better.

 
 
Comment by palmetto
2017-04-06 18:15:26

First I laughed really hard. Then I curled up in a fetal position and started sobbing.

http://taskandpurpose.com/jared-kushner-iraq-storybook-pictures/

Comment by scdave
2017-04-06 18:26:45

You own it

 
Comment by new attitude
2017-04-06 18:27:53

I hope he got a chance to go rug and spice shopping.

 
 
Comment by JSandusky
2017-04-06 18:30:19

Cry or laugh at this kind of utter idiocy? What a fukushima!

US Launches Air Strike On Syria: 60 Tomahawk Missiles Hit Syria

Comment by palmetto
2017-04-06 18:42:04

Well, folks, that’s ballgame.

Must’ve been planned for a while, too. Like a Hollywood production.

Well, one and done. Not even one.

Comment by scdave
2017-04-06 19:01:28

And we did not even make it to 100 days. Who would have thunk.

Comment by Ben Jones
2017-04-06 19:29:56

The war started more than a thousand days before today. Over 400,000 dead, 11 million homeless. 400,000 dead. People being beheaded, burned alive. Not in some far off barbarian time.

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Comment by Blue Skye
2017-04-07 09:29:57

“we did not even make it…”

So…you are part of this country now?

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Comment by JSandusky
2017-04-06 19:11:06

Jokes write themselves. ISIS/AQ - it’s DC, go get them! I would not shade a tear

CALLS ON ‘CIVILIZED NATIONS’ TO JOIN IN ‘SEEKING TO END THE SLAUGHTER AND BLOODSHED IN SYRIA’…

Comment by junior_kai
2017-04-06 19:39:53

Its ok to shoot people in the head or bomb them, but using chemical weapons is UNACCEPTABLE!

This stinks - no motive for Assad to do this as far as I can tell. Scum bags like McCain are probably dancing though.

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Comment by Ben Jones
2017-04-06 21:09:36

Adult diapers on aisle 3.

 
 
 
Comment by JSandusky
2017-04-06 19:30:47

I miss Susan Rice.

Comment by Albuquerquedan
2017-04-07 09:25:30

So does ISIS

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Comment by Albuquerquedan
2017-04-07 09:50:40

I will not lose hope in the Trump presidency until Bannon is gone. Politically this was low hanging fruit for Trump. He showed he was able to act contrary to Russian interests, and he sent a message to Iran and China that he will use military force. If he stops now it is a political windfall. It he lets the globalists try to talk him into removing Assad so they can run a gas pipeline through the country, his presidency will be a failure, although just the one supreme court seat made the vote for him worth it, Hillary would have been much worse for anyone trying to stop globalism, she and her husband are responsible for both NAFTA and the rise of China.

 
 
 
Comment by aNYCdj
2017-04-06 18:33:06
 
Comment by Senior Housing Analyst
2017-04-06 18:59:36

Sterling, VA Housing Prices Crater 7% YoY

https://www.zillow.com/sterling-va-20151/home-values/

 
Comment by Avg Joe
2017-04-06 19:03:24

http://wolfstreet.com/2017/04/06/startup-vc-funding-deflates-silicon-valley-san-francisco/

“So office space availability is suddenly piling up after years when the term “shortage” was the guiding theme behind all real estate decisions, and everyone went out to grab whatever was available, whether they needed it or not. But companies are cutting back and putting unused space on the market:

As much as 1.3 MSF of direct space and potentially 300,000 square feet of sublease space could hit the market by the end of 2017 as several large publicly-traded tech companies shed excess space. The result could be the pivot point toward a market correction, adding additional uncertainty to a market dealing with a rise in large block availability.

That sort of combined pull-back by the tech sector and by the startup ecosystem is a sea change for a region whose excesses, craziness, and prices have long befuddled rational observers.”

Comment by Ben Jones
2017-04-06 19:24:01

‘Including San Francisco darling Airbnb’s $1 billion deal, startups raised a total of $16.5 billion in the first quarter, down 12% year-over-year. The number of companies being funded plunged 24% to about 1,800 – the sixth quarter in a row of declines, and the lowest count since Q3 2010.’

‘Extrapolating from Q1, the full year 2017 is on track to hit the lowest level in terms of dollars since 2012, and in terms of deals since 2011. This chart (via PitchBook Data and National Venture Capital Association) shows the number of deals in the US, a bubble and its deflation.’

“The pace at which total fundings are declining shouldn’t be overlooked,” the report said.’

 
 
Comment by palmetto
2017-04-06 19:36:20

Well, aside from that, Mr. Xi, how was your dinner?

Comment by new attitude
2017-04-07 09:25:49

I was hoping Xi took out fat boy in NK, the same night we took out Assad. The press would be overwhelmed.

Comment by butters
2017-04-07 10:05:02

Did we take out Assad? It was nothing more than showboating. Expensive showboating. Pure and simple act of terrorism.

Comment by MightyMike
2017-04-07 10:11:05

That’s where Xi comes in. It may be expensive, but he’ll lend us billions to pay for it at a nice, low interest rate.

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Comment by butters
2017-04-07 10:26:52

Xi must have laughed inside at this utter foolishness.
What a fukushima!

 
 
Comment by Albuquerquedan
2017-04-07 14:11:35

It is a shot across the bow. Sometimes that is all that is needed. If Assad does not use poison gas again and does not do things any worse than what is being done to root out ISIS in Iraq, it is none of our business. Thus, there was no reason to kill numerous Syrian troops or risk escalating the situation by killing Russians. The world seems to approve, the dollar rose strongly today.

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Comment by Senior Housing Analyst
2017-04-06 19:46:06

El Cajon, CA Housing Prices Crater 8% YoY

https://www.zillow.com/el-cajon-ca-92020/home-values/

 
Comment by Crow Breath
2017-04-06 19:51:55

Another one from Seattle today. Their fire is getting big.

http://www.seattletimes.com/business/real-estate/seattle-home-prices-hit-700000-for-first-time-after-doubling-in-five-years/

“Prices jumped more than 7 percent from just a month before, the second-biggest increase in the last three years.”

“In Seattle, the median price for a house hit $700,000 for the first time. Prices in the city have also doubled in the last five years, and have climbed $60,000 in the last year.”

 
Comment by Senior Housing Analyst
2017-04-06 20:11:03

Issaquah, WA Housing Prices Crater 6% YoY

http://www.movoto.com/issaquah-wa/market-trends/

 
Comment by azdude
2017-04-07 05:45:26

98000 walmart and mcdonalds jobs created in march.

Comment by Professor Bear
2017-04-07 06:47:37

Dang warm weather messed up new hiring!

 
 
Comment by MightyMike
2017-04-07 07:04:41

International Real Estate Commissions Fall Dramatically, United States Remains Highly Inefficient

Introduction

In 2002, economists Natalya Delcoure and Norm Miller conducted the first study to compare international residential brokerage fees, titled International Residential Real Estate Brokerage Fees and Implications for the U.S. Brokerage Industry.

What they found was puzzling. Many similarly industrialized countries charged home sellers a commission ranging from 1 percent to 5 percent, but the United States was an exception at 6 percent. The study found that commission rates in the United States were abnormally high for a country presumed to be one of the most efficient and price competitive in the world. It also suggested that U.S. residential brokerage fees should run closer to 3 percent; if the typical U.S. agent were as productive as those in England, the brokerage fees would be closer to 1.5 percent.

What follows is an update of the study to determine what, if any, impact the Internet had on commissions during the last 13 years.

Highlights – 2002 vs. 2015
•The United States retains one of the highest commissions among the world’s industrialized countries at 5.5 percent, while most others saw significant drops.
•Former and quasi-communist countries Belarus, China and Russia, had significant drops in their average commissions by 81 percent, 47 percent and 73 percent, respectively.
•Only Hong Kong and Japan show a commission increase, doubling transaction costs due to the introduction of buyer’s agency.
•The lowest real estate commissions in the world are found in Northern Europe and average 1.7 percent.
•Mexico has the highest commissions in the world, remaining unchanged at 7.5 percent.

https://surefield.com/international-real-estate-commissions

Comment by taxpayer
2017-04-07 07:25:13

I bought n sold my own sht shacks before the interweb. Why would u need a realtor anymore?

 
 
Comment by Professor Bear
2017-04-07 07:25:39

The Plunge Protection Team is doing a great job of buffeting the stock market against the triple whammy of a bad jobs number, rising wholesale inventories, and a surprise missile strike.

Once upon a time, such a confluence of events would have knocked several percentage points off share prices at the opening bell. There clearly has never been a better time to own stocks!

Comment by Crow Breath
2017-04-07 12:43:44

The market never does what it’s “supposed to do”.

Comment by Professor Bear
2017-04-07 21:33:18

It really did used to respond with price declines in the wake of unanticipated negative developments that drove a sudden spike in fear, just like financial economics text books say is supposed to happen. But with volatility smoothing algorithms in play such dip buying opportunities seldom happen these days.

 
 
 
Comment by palmetto
2017-04-07 09:34:58

“Hello? Uh, hello? Hello, Dmitri? Listen, I can’t hear too well, do you suppose you could turn the music down just a little? A-ha, that’s much better. Yeah, yes. Fine, I can hear you now, Dmitri. Clear and plain and coming through fine. I’m coming through fine too, eh? Good, then. Well then, as you say, we’re both coming through fine. Good. Well, it’s good that you’re fine, and - and I’m fine. I agree with you. It’s great to be fine. [Laughs] Now then, Dmitri, you know how we’ve always talked about the possibility of something going wrong with the bomb. The BOMB, Dmitri. The hydrogen bomb. Well now, what happened is, uh, one of our base commanders, he had a sort of - Well, he went a little funny in the head. You know. Just a little funny. And uh, he went and did a silly thing.
Well, I’ll tell you what he did. He ordered his planes…to attack your country.

Well, let me finish, Dmitri. Let me finish, Dmitri. Well, listen, how do you think I feel about it? Can you imagine how I feel about it, Dmitri? Why do you think I’m calling you? Just to say hello?

Of course I like to speak to you! Of course I like to say hello! Not now, but any time, Dmitri. I’m just calling up to tell you something terrible has happened.

It’s a friendly call. Of course, it’s a friendly call. Listen, if it wasn’t friendly, you probably wouldn’t have even got it. They will not reach their targets for at least another hour. I am, I am positive, Dmitri. Listen, I’ve been all over this with your Ambassador. It is not a trick. Well, I’ll tell you. We’d like to give your Air Staff a complete rundown on the targets, the flight plans, and the defensive systems of the planes.

Yes, I mean, if-if we’re unable to recall the planes, then, I’d say that, uh, well, uh, we’re just gonna have to help you destroy them, Dmitri. I know they’re our boys. All right, well listen, now, who should we call? Who should we call, Dmitri? The what, the People, you, sorry, you faded away there. The People’s Central Air Defense Headquarters. Where is that, Dmitri? In Omsk. Right. Yes. Oh, you’ll call them first, will you? Uh, huh. Listen, do you happen to have the phone number on you, Dmitri? What? I see. Just ask for Omsk information.

I’m sorry too, Dmitri. I’m very sorry. All right, you’re sorrier than I am. But I am sorry as well. I am as sorry as you are, Dmitri. Don’t say that you’re the more sorry than I am because I am capable of being just as sorry as you are. So we’re both sorry, all right? All right.”

Comment by butters
2017-04-07 10:02:41

Orange man…worst president ever!

Comment by palmetto
2017-04-07 10:26:24

Are you delusional? Yeah, he really just outdid Bush and Obama, right? I just cut and pasted that from Dr. Strangelove because it’s probably one of the best dark humor scenes in movie history.

Don’t get me wrong, I’m far from happy with what happened, and I’m not on board with Gorsuch, since I’m not a fan of anyone who makes a legal argument for torture, but to say he’s the worst ever is like jamming a crack pipe up one’s patootie.

I’ll tell you what’s the worst ever: globalism and its bastard children, the agenda driven media and the deep state and the FED and a whole bunch of other things that smell like butt, like this real estate bubble.

Comment by butters
2017-04-07 10:55:39

I said that in some jest and in some seriousness, but the guy keeps on disappointing his supporters every day with his buffoonery. I was happy he won but didn’t vote. At least now I have come to acceptance that next 3 years 9 months will be more of the same, I call it, bushobarump.

(Comments wont nest below this level)
 
 
 
 
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