The Housing Bubble

A report from The Real Deal on New York. “Westchester residents, many trying to avoid the hefty tax bill that 2018 promises, are finding themselves in an unforgiving buyers’ market. Prices in the county fell 18 percent in the second quarter of 2018, with homes asking between $1.5 million to $3 million faring the worst, according to Bloomberg. In Scarsdale alone, prices dipped 5 percent in the first six months of 2018, while Mamaroneck saw a 13 percent drop.”

“As a result, the number of homes for sale in Westchester has been increasing: in late June, inventory was up 5 percent compared to last year and, for homes priced between $2-2.5 million, listings were up 26 percent.”

“Buyers are feeling no sympathy for homeowners who bet on turning a neat profit when they decided to sell off their prestige address. Compass broker Angela Retelny says her clients tell her ‘Look, I’m not going to spend more than $35,000 in taxes.’ … Houses are just being dismissed, even though they’re superior homes, and they have to be reduced — because their taxes are just way too high for the price range.’”

“With buyers taking a hard line, sellers are being forced to bend, according to her. There are ‘dramatic price reductions every single day — every hour, pretty much,’ she told Bloomberg.”

It’s Friday desk clearing time for this blogger. “While prices continue to rise, Mike Figura, Mosaic Community Lifestyle Realty’s owner, said some indicators do suggest a gradual cooling of the local market. For instance, both Asheville and Buncombe had fewer home sales overall in the first half of this year compared to last. Also, the average days on the market increased, which means homes aren’t selling as fast. And at the higher end of market, houses are lingering too, creating more inventory. Nobody is ringing the alarm bells, but Figura contends ‘if builders aren’t smart about what they’re building, they could flood the upper prices ranges. There were some significant increases in inventory levels in the higher price ranges between the second quarters of 2017 and 2018 in the both the city and county.’”

“The real estate market is cooling in parts of North Texas according to realtors and experts. Two nice houses side-by-side in Frisco are an example according to, Ebby Halliday Realtor Brian Johnson. One he sold in May 2017 for over the asking price. ‘We listed for $309,000. In 3 days I had 17 offers. We sold it for 335,’ he said. The one next door has been on the market 49 days. It has hardwood floors, an updated kitchen and master bath. ‘This home has over 600 square feet more and its way more updated and I’ve got no offers,’ Johnson said. ‘Now we just dropped the price 10 thousand and I do have someone interested.’”

“The U.S. housing market — particularly in cutthroat areas like Seattle, Silicon Valley and Austin, Texas — appears to be headed for the broadest slowdown in years. Some of the most expensive markets, where sales are falling under the weight of prices, are now seeing substantial increases in supply, according to Redfin Corp. In San Jose, California, inventory was up 12 percent in June from a year earlier. It rose 24 percent in Seattle and 32 percent in Portland, Oregon.”

“‘Affordability is becoming a major headache for homebuyers,’ said Lawrence Yun, the National Association of Realtors chief economist. ‘You are seeing home sales rising in Alabama, where things are affordable. But in places like California, people aren’t buying.’”

“In pricey Southern California, sales of both new and existing homes fell sharply in June compared with a year ago, according to CoreLogic. Demand is still quite strong, and while prices continue to gain, more listings are showing price reductions. ‘The market is strong, but I’m seeing a noticeable difference in the number of buyers that are looking at my listings each week,’ said David Fogg, a real estate agent based in Burbank, California. ‘Many properties are now not selling and/or coming down in price.’”

“Orange County mortgage broker Jeff Lazerson said people are increasingly refusing to waive appraisal contingencies and willing to step away from a deal rather than engage in bidding wars. ‘I haven’t seen hesitation like this in years,’ said Lazerson. Lazerson explained the feeling of many would-be buyers like this: ‘This economic expansion, this run-up in home prices, has been going on a very, very long time.… At what point does all this stop?’”

“If there is a true slowdown around the corner, one of the first signs would be a subtle shift of power from sellers to buyers. Inland Empire real estate agent Kira Madrigal said sellers in the markets she covers still have the ‘upper hand,’ but buyers are increasingly willing to submit ‘low-ball’ offers.”

“The number of closed sales from April through June dropped 6.2 percent year over year, to 91 homes in L.A.’s luxury market. In the non-luxury market, the median sales price in L.A. County, primarily Westside and Downtown, slipped for the first time in over five years to $1.3 million. That’s a 7.1 percent decline compared to last year, and the first drop in 23 consecutive quarters. Sales in this segment dropped 5.8 percent to 1,701 homes. There were 453 luxury homes listed for sale, up from 346 last year over the same period, and 365 in the first quarter of 2018. It is also taking brokers longer to sell the homes in this segment. The amount of days the homes spent on the market jumped 41 percent year over year to 120 days.”

“Discounts on asking prices also rose to 11 percent, up from 6.8 percent last year. The slowdown in sales is also happening beyond L.A. County. In a new report from CoreLogic, just 22,706 homes sold across six counties in Southern California last month, representing a nearly 12 percent drop year over year. The figure was also 15 percent lower than the average sales since 1988.”

“June sales of both newly built and existing homes in the San Francisco Bay Area dropped just more than 9 percent compared with a year ago, according to CoreLogic. Sales of newly built Bay Area homes were nearly 32 percent below the historical average, going back to 1988. ‘Price growth is only part of the problem that home shoppers have faced,’ said Andrew LePage, a CoreLogic analyst. ‘The median price paid for a Bay Area home this June was up almost 13 percent year over year, but the principal-and-interest mortgage payment on that median-priced home was up about 22 percent because of the rise in mortgage rates – more than half a percentage point – over the past year.’”

“Much has been made of the dazzlingly wealthy foreign buyers who snap up luxury condos in New York City and Miami; breathtaking beach houses in Honolulu; and sophisticated modern estates in San Francisco and Seattle. But foreign-resident buyers and recent immigrants closed on far fewer properties in the 12-month period ending in March 2018—by about 21%, according to a recent report from the National Association of Realtors®. ‘I’m seeing a slowdown with Chinese buyers,’ says New York City–based real estate agent Kerry Lynn of Douglas Elliman, who works primarily with Chinese and South American buyers who are looking for newly constructed, high-rise condos with luxury amenities in Manhattan for $1.5 million to $2 million.”

“‘Inventory shortages continue to drive up prices and sustained job creation and historically low interest rates mean that foreign buyers are now competing with domestic residents for the same, limited supply of homes,’ said Lawrence Yun, chief economist for the Realtors. For international investors who are looking for condominiums in large cities as an investment, the supply theory doesn’t really hold.”

“‘I don’t think it’s the supply issue because these buyers are buying in the higher end and there is more supply there, particularly in the gateway cities like Miami and New York,’ said Sam Khater, chief economist at Freddie Mac. ‘It could be just that their appetite for U.S. real estate is waning.’”

“Long Island has become a tale of two housing markets, with home buyers competing for starter houses while high-priced properties linger on the market, a new report shows. The top fifth of sales fetched a median price of $820,000, down 0.6 percent annually. For the Island’s luxury market – that is, the top 10 percent of sales – the median price fell by 6.7 percent annually, to $1.05 million. Throughout Long Island – except for the Hamptons and the North Fork — homes sold in 5.1 months on average, at a 3 percent discount from their listing price, the report shows. Luxury homes, though, spent an average of 17 months on the market, and sold for a 6 percent discount. The Hamptons was the only region to see a price decline, with a median price of $975,000, down 5.3 percent year-over-year.”

“Recent news that home sales in Westchester County declined by 18% the second quarter in 2018 in comparison to the same period in 2017, should have not only local elected municipal officials very concerned, but also those at the New York state level. This is the fourth consecutive quarterly decline in the county’s home sales. Westchester residents are putting up their homes for sale since federal tax reform now significantly limits to $10,000 the deduction of local and state taxes. This is about half the $17,179 average tax paid by Westchester residents in property taxes in 2017. As more and more people put up their homes up for sale, this will start to lower home values.”

“Why the face? Maybe because this buyer’s flipped two units at 432 Park Avenue at a loss. An LLC by the name of ‘WHY THE FACE’ just sold a unit on the tower’s 65th floor for $24.2 million, records filed with the city’s Department of Finance show. That’s down from the $25.6 million the buyer paid in March 2016, and $8.3 million less than what the apartment was initially listed for in April 2017. This mysterious buyer sold another unit at a slight loss — roughly $73,500 — on the 28th floor. The unit was purchased, according to city records, on the same day as the other apartment. The buyer paid $1.8 million and then sold the unit in June.”

“The perils of flipping luxury apartments in today’s market are well-documented. As prices fall and a steady of flow product continues to hit the market, turning a profit is increasingly difficult.”

“Declining demand has driven down housing prices across most of the North Shore, but sales of homes in Evanston have remained robust. The average sales price fell by 4.3 percent in 2018, according to local real estate data, dropping from over $750,000 to under $718,000 in the north suburban market. For the north suburban housing market as a whole, the median sales price fell 8.1 percent, from $631,000 to $580,000 compared to last year.

“June home sales in Greater Hartford lost the upward momentum of earlier this year, as purchases and prices paid slipped for the second month in a row, a new report shows. The median sale price of a single-family house — in which half the sales are above, half below — dropped 6.3 percent, to $225,000 from $240,000 for the same month a year ago, according to the Greater Hartford Association of Realtors. Holly Callanan, chief executive of the association, said, ‘It is possible potential buyers are stalling because of the low inventory that makes for limited choices.’”

“If you’re looking into buying a home in Williston, you’re in luck, depending on what you want to spend. ‘It is busy, could we use some more inventory, yes. Everybody tends to be around that 250 to 350 price range,’ said Chelsey Melby, Basin Brokers Real Estate agent. For those looking to sell, don’t over price. With so many homes available, Melby says buyers can afford to be a little picky. ‘If they are priced right for the square footage in the area a lot of times they will go as fast as 24 hours. If you see a housed that’s overpriced it will sit probably 90 to 180 days,’ said Melby.”

It’s Friday desk clearing time for this blogger. “ATTOM Data Solutions, on Thursday reported foreclosure filings for the first half of 2018. Counter to the national trend, 26 of the 219 metropolitan statistical areas analyzed in the report posted a year-over-year increase in foreclosure activity in the first six months of 2018, including Houston, Texas (up 10%); Dallas-Fort Worth, Texas (up 11%); Cleveland, Ohio (up 4%); Phoenix, Arizona (up 5%). ‘Localized foreclosure flare-ups in the first half of 2018 can no longer be blamed on legacy distress left over from the last housing bubble given that nearly half of all active foreclosures are now tied to loans originated in 2009 or later and given that the average time to foreclose plummeted in the first two quarters of the year,’ said Daren Blomquist, senior vice president with ATTOM Data Solutions. ‘Instead these local foreclosure increases are typically the result of more recent distress triggers in those markets.’”

“‘We’re also seeing early evidence of gradually loosening lending standards starting in 2014, specifically for FHA-backed loans,’ Blomquist added. ‘The foreclosure rate on FHA loans originated in 2014 and 2015 has now jumped above the average FHA foreclosure rate for all loan vintages — the only two post-recession vintages with foreclosure rates above that overall average.’”

“Counter to the national trend, foreclosures were on the rise in the Phoenix area in the first half of the year. But it’s no reason to worry. There were more than 5,000 foreclosure filings — default notices, scheduled auctions or bank repossessions — in the Valley through June, a 5 percent increase from a year ago, according to ATTOM Data Solutions. The good news? That’s just a fraction of the 74,000 foreclosures in the area during the worst times of the housing crisis a decade ago.”

“A decade ago, you’d see foreclosure signs across most Southwest Florida, which became the sign of a troubled economy and housing market. And now, despite a building boom across our area and a robust jobs market, we’re once again starting to see the number of foreclosures climb. A sight reminiscent of years past is once again popping up in Cape Coral and across the rest of SWFL. Cape Coral homeowner Jacob Rico says he notices fewer people in his neighborhood, ‘I see many houses like this – empty. Over there a couple houses is empty.’”

“More homeowners in Southwest Florida are struggling to pay their mortgages on time, an apparent lingering effect from Hurricane Irma. In the Sarasota-Manatee region, 4.4 percent of mortgages were at least 30 days overdue in May, up from 3 percent one year earlier, CoreLogic said. Charlotte County also posted a 4.4 percent mortgage delinquency rate, higher than the 3.5 percent last year. In Florida, the 30-day delinquency rate averaged 6.7 percent, ahead of the year-ago 5.5 percent. The rates of homes already in the foreclosure process are holding below year-ago levels, a sign that lenders may be postponing taking struggling homeowners to court.”

“‘The percent of loans 90 days or more delinquent or in foreclosure are more than double what they were before last autumn’s hurricanes in Houston, Texas, and Naples, Florida,’ said Frank Martell, CEO at CoreLogic.”

“Connecticut entered July with the fifth-highest rate of residential mortgages under foreclosure in the nation, according to a study of more than 360,000 foreclosures nationally over the first six months of the year. As of the most recent records posted by the Connecticut state courts, Bridgeport had the largest number of pending foreclosure sales in the coming month at 30 properties, followed by the cities of Stamford, New Haven and Hartford with 18 each. But affluent towns are seeing activity, as well, with a half-dozen foreclosure sales under way in Westport, five in Ridgefield and a pair of properties in Greenwich.”

“According to PropertyShark, Queens had 881 properties go into new foreclosure proceedings in this year’s second quarter, running from April to June. Queens — particularly the Southeast section of the borough — continues to be ground zero in terms of an ongoing mortgage crisis. Those numbers did not likely take leaders at Community Board 12 by surprise. ‘District 12 is still a hotbed for foreclosures,’ said CB 12 District Manager Yvonne Reddick.”

“Reddick’s oft-repeated advice is that dealing with the problem early in the process is far preferable to what can result if people as a matter of pride or other reasons choose to ignore notices and the ability to reach out for help. ‘When the marshal shows up to evict you, people are going to know,’ Reddick said.”

“President Donald Trump’s new tax cut plan may have created a shift in the Westchester housing market. According to appraiser Miller Samuel Inc. and brokerage Douglas Elliman Real Estate, home sales in Westchester plunged 18 percent in the second quarter from a year earlier. That is the highest amount since 2011. ‘When they look at a property, they are concerned about the amount of taxes they’ll have to pay,’ says Michele Silverman Bedell, broker/owner of Silverson’s Realty. ‘The taxes could be $20,000 $30,000, $40,000 on a house.’”

“Bedell says this could discourage buyers and convince potential sellers to downsize. It could also flood the market with inventory and force price reductions.”

“Both startling and subtle evidence is emerging that our housing market is changing course. Let me count the ways: 1) California notice of default filings (step one of the foreclosure process) were up a staggering 24 percent (4,144) in June compared with one year ago. And, the state has experienced three straight months (April, May and June) of increased foreclosure activity according, to Daren Blomquist, Attom Data Solutions senior vice president.”

“Twenty-two states posted year-over-year increases in foreclosure starts for the first half of 2018. Normally solid metro areas like Las Vegas, Dallas-Fort Worth and Minneapolis-St. Paul experienced increases, also according to Blomquist. Thirteen percent of Orange County home sellers reduced their asking prices in recent weeks, according to Steve Thomas of Reports On Housing. Orange County’s home-listing inventory hit 5,983 this time last year, Thomas reported. This week, there were 6,501 homes listed for sale, a 9 percent increase over this time last year.”

“Sellers would be best served by prudence. ‘We’ve hit the top of the market. Anybody new to the market better price their property at market rate or below,’ said Dan Keller of EXP Realty in San Clemente. In this current market, I see many buyers playing a fools game by way overbidding based upon actual closed comparable sales. You’ve got to get rid of that ‘got to have it no matter what’ mentality.”

“June’s home sales numbers for North Texas made me do a double take. Preowned home sales in the area were down by the biggest year-over-year percentage in four years. Okay, it wasn’t down by much — just a 3 percent drop from June 2017’s record high preowned home buys. But for the last few years, the only direction Dallas-Fort Worth’s housing market has known is ‘up.’”

“All good things must come to an end. And there are more signs that our runaway housing market is hitting a ceiling. ‘Maybe we are seeing the beginning of the slowdown of the hyper growth Dallas has had for the last six or seven years,’ said Dr. James Gaines, chief economist at the Real Estate Center at Texas A&M University. ‘We’ve been kind of expecting it for almost a year now. It’s going to slow down eventually,’ he said. ‘The eventually may be getting here.’”

“Another telling sign of where the D-FW home market is headed this year is the rise in homes on the market. The almost 25,000 houses with ‘for sale’ signs in the front yard is the largest local inventory since 2012. ‘It’s not necessarily that the market is gong to go bad,’ Gaines said. ‘But the almost double digit price increases and increases in sales volume are going to slow down we think. You are going to start seeing some small negatives on a year-over-year basis.’”

“One subdivision won’t end the Rogue Valley’s housing shortage. In a real estate market where a dearth of housing inventory is decried at the turn of every calendar page, however, a Mahar Homes subdivision is poised to provide more options for 55-and-older buyers. Prices haven’t been fixed on the 28-acre development that will eventually have 44 single-family residences overlooking orchards and vineyards, but Mahar Homes General Manager Randy Jones indicated price tags will range above the $400,000 mark.”

“The number of houses on the market grew 16.2 percent to 1,117 from 961 and topped 1,000 for the first time since last September. ‘We’re seeing more people jumping in,’ said Colin Mullane, spokesman for the Rogue Valley Association of Realtors. ‘We’re reaching peak prices of 2005 and 2006 after a much steadier build. We’ve been hoping for this for quite some time.’”

“The first wave of modern high-end homes is about to hit Akron. Private developers are busily buying up 35 acres of city-owned land to build 349 homes in four developments, some so dense that 15 houses will fit on an acre. The first of the homes will be on the market later this year or early next, carrying price tags of up to $280,000. It’s all single-family housing.”

“More cautious residents worry that developers are overestimating the market. That’s what happened on Hickory Street when two homes went up, the bottom fell out on the housing market and no more units have been built since. ‘That’s my biggest concern is that you’ll have 51 homes at $200,000 and nobody to buy them,’ said Jamie Brown, who lives beside the future site. Some neighbors also question the prices. How, in a city with a median household income of $35,240, can anyone afford a $200,000 home?”

“‘There are a lot of [used] homes here that are selling for half that. So why would someone spend that much?’ asked the Rev. Scott Campbell, whose Shoreline Church sits across the street from the barren Guinther Park. ‘Are they going to sit empty if no one buys them and eventually become Section 8?’”

“Prices for purchasing a house in Sidney are on the downward trend, but asking prices still remain pretty steep in the area. Leif Anderson, owner of Beagle Properties in Sidney, says that single family homes are selling fairly well. ‘But the other segments, commercial lots and multi-family homes, aren’t going very well,’ Anderson said.”

“He explained that homes have experienced a fairly significant correction or decline in prices. But are prices back to where they were prior to the pre-Bakken days? ‘Not even close, actually,’ Anderson said. He said people might think that way until they look back at the much lower prices from years such as 2005 and 2006. ‘You forget where our numbers were. Compare to that, the numbers are still pretty big.’”

“He is worried that the prices may even dip lower. ‘We felt because there’s more [oil] activity, it would strengthen the real estate market. So far, it hasn’t happened yet.’ Factors why the housing market hasn’t improved in eastern Montana include that most of the oil activity has been being conducted in North Dakota and that Williston and Watford City now has plenty of housing available. ‘We won’t have an overflow,’ Anderson said.”

A report from the Real Deal. “It’s a question other lenders are asking more and more as they find themselves being beat by either Fannie or Freddie. The reason the two loan agencies are outperforming institutional lenders is thanks to government insurance that allows them to charge lower rates than others, explains Real Capital Analytics’ Jim Costello in The Financial Times. Since the crash, in addition to providing traditional loans for homeowner’s mortgages, both agencies have been increasingly financing rental housing, taking on the risk for loans underwritten by commercial mortgage companies. Last year alone, they financed about 1.6 million rental units in the U.S. (In the fall, The Real Deal reported that Freddie was dominating multifamily lending in the New York area.)”

“Fannie and Freddie say it was just the hand they got dealt. ‘It’s not because we’re trying to do more high end or more expensive properties,’ Fannie’s multifamily chief credit officer Manuel Menendez told the Times.”

The Arizona Daily Star. “Within two years, Tucson could face a shortage of more than 1,700 apartments pushing rents to levels not seen before in this market. In 2017, only 318 new units were brought online and 796 units are now under construction. The majority of activity in the multifamily market is among investors buying older properties and fixing them up and increasing rents when leases are renewed.”

“‘The vast majority of everything being built is luxury lifestyle apartments because there’s demand for it,’ said Mike Chapman, a multifamily specialist with NAI Horizon. ‘Where I see the real rub is the lack of workforce rentals. It’s going to be an issue.’”

The Charlotte Observer in North Carolina. “With thousands of new luxury apartments flooding the uptown market in Charlotte, a San Francisco-based startup has a possible solution: Turn some of them into hotel rooms. Lyric has leased a whole floor of one of the two SkyHouse Charlotte apartment towers. The rooms make up only a small percentage of SkyHouse’s 672 studio, one- and two-bedroom units.”

“Lyric will have plenty of opportunities to find apartments in Charlotte, which has a glut of luxury buildings hitting the market in uptown. According to figures released in March, uptown has the highest apartment vacancy rate in Charlotte, at 21.8 percent. That translates into more than 1,100 vacant apartments, according to tracking service Real Data.”

“That’s largely a byproduct of the uptown market’s rapid growth. The number of apartments uptown has more than doubled since 2015, to more than 5,000, and that expansion will continue as developers chase sky-high rents. The number of apartments uptown is expected to reach more than 6,700 in the next few years.”

From Willamette Week in Oregon. “Rents for apartments in newly constructed buildings declined last year—marking a real change, at least temporarily, in the upward trajectory of housing costs. ‘Properties built in 2014 or later were reducing their asking rents across all unit sizes last year—particularly among newly constructed studio apartments, where asking rents decreased up to 6 percent over 2016 prices,’ according to the Portland Housing Bureau’s 2017 State of Housing in Portland report.”

“The data on rent comes as construction continues to boom: 9,639 was the number of new units of housing produced in 2015 and 2016– that’s more than the five-year period of 2009-2013.”

The Real Deal on California. “The troubled investment firm Woodbridge Group of Companies offloaded a 52-unit apartment complex in the northern San Fernando Valley earlier this month. Van Nuys-based Adil A Barakat Family Trust, an investor at least nine other multifamily properties around Los Angeles and the Inland Empire, paid $21.5 million for Granada Pointe complex at 11541 Blucher Avenue, which was built in 2011. The sale includes a $10.5 million mortgage with Seattle’s Homestreet bank.”

“The Sherman Oaks-based firm is embroiled in crisis. The Real Deal reported in November that the Securities and Exchange Commission was investigating the firm for fraud. CEO Robert Shapiro resigned a few weeks later, and the SEC then sued him for a billion-dollar Ponzi scheme that netted him millions of dollars, much of which he spent on luxury items.”

“Word spread in March that the firm had solicited some of the L.A.’s top brokers to sell its residential portfolio, which includes some of the premier homes in Los Angeles county. Woodbridge was asking unusually large sums for many of the properties, in what some real estate professionals have described as an effort to present a rosier portrait of the portfolio to investors.”

The Lohud Journal in New York. “Rental apartment buildings have been sprouting up throughout the region in recent years, and some people in the community are wondering whether there are too many of them for the market to absorb. Multi-family development projects have been a favorite among real estate investors and developers in the post-recession era. The cycle of expansion has recently reached its peak nationwide, but considering the strong economy and continuing demand for rental apartments, the decline would be gradual, said Jeanette Rice, who heads multifamily research for CBRE, a major commercial real estate and investment firm.”

“Just shy of 1,000 new apartments were completed and added to the south Westchester market inventory in 2017. The number is expected to jump to about 1,700 in 2018, said Kimberly Byrum, principal of Meyers Research, who also gave a presentation. The 2018 number is twice as much as her estimate of the area’s annual absorption, about 850 to 900 units.”

“A symposium attendee thought Byrum’s estimate of the new apartments coming on the market in 2018 seemed low, remarking that she was aware of developers ‘worrying that maybe too much coming online already, and they shouldn’t be planning projects.’ Plans for thousands of newly created apartment units have been proposed or already approved in Westchester communities such as New Rochelle, White Plains, and Yonkers.”

“Landlords of existing apartments will have to offer concessions to attract tenants to compete against new apartments, Byrum said. But in a bigger picture, the market will do just fine, she said. ‘I think a lot of things you are hearing within the market is just the concern of the current owners in the market whose buildings are 97 percent occupied,’ Byrum said. ‘It’s (the occupancy rate) going to come down to 93 to 95 percent.’”

“Rice said she does worry about the excess supply of new apartments in certain cities, such as San Antonio and Austin in Texas, where more than 7,000 units — or more than 4 percent of their existing inventory — were added to the market in 2017 alone. Some pockets of Manhattan may also have too many new units coming on the market at once, she said, and added: ‘Don’t worry about any part of New York outside of Manhattan. We are not building that much.’”

From Broker Pulse on New York. “A special new type of resident has hit New York City: the non-existing resident. Rental apartments across the city have become host to a ghost city where today, 247,977 units sit unoccupied. That’s more than 11 percent of all rental apartments in New York City. These numbers released from the Census Bureau’s Housing and Vacancy Survey shed light on an issue that has been growing significantly over the past three years. The number of vacant rentals has grown by 65,406 apartments since 2014, a 35 percent spike in size.”

The Buff State Record in New York. “As a native New Yorker, going home is something I always look forward to. However, every time I go home, I always see more apartments being built that all have the same banner wrapped around them. It usually says something like, ‘Luxury apartments, coming soon!’ The word luxury being used in this case has come to really mean unaffordable.”

“Neighborhoods in Queens, Brooklyn and Manhattan are flooded with these kinds of developments. The rest of the sign might read as, ‘One Bedroom starting at $2,350, Studio starting at $2,050.’ After seeing this, people slowly realize the true luxury is being able to afford one of those apartments. Luxury has changed to really become a means of disguising something that really isn’t a luxury. It has become an illusion because almost all apartment buildings that go up usually have the big banner saying that these are luxury apartments. Because of this idea of luxury, people cannot afford to live there.”

A report from MarketWatch. “The National Association of Home Builders’ monthly confidence gauge ticked down one point to a reading of 69 in April, the group said Monday. The closely-watched sentiment tracker from the home builder lobby group hit its highest point since 1999 in December, and has fallen every month since then. The 69 reading is still quite strong. In the go-go days of the housing bubble, between 2004 and 2005, sentiment averaged 68. Still, the fact that confidence is declining so steadily is notable. When NAHB’s index started to fall in late 2005, it was one of the signals that foreshadowed the coming housing bust.”

From Inside NOVA. “The housing inventory is low nationwide, with a three-month supply that’s half what’s considered the equilibrium rate. Permits to build single-family homes have been down ever since the recession of the late 2000s, said Ken Wingert, senior legislative representative for the National Association of Realtors. People also are staying in their homes an average of 10 years, double the tenure that occurred in 1980, he said.”

“Retiring Baby Boomers trying to downsize their living quarters are competing for the same smaller housing units with Millennials just entering the real estate market, Wingert said. In addition, huge student-loan burdens have led young people to delay purchasing homes by about five years, he said. Perhaps most ominous was this statistic: Average incomes rose 15 percent between 2011 and 2017, but housing prices increased 48 percent during that period, Wingert said.”

“‘There has got to be a tipping point,’ he said. ‘This is not sustainable.’”

From CNN Money. “Zillow is the site you go to when you want to know how much more the house you bought a few years ago is now worth. But the real estate information company is planning to get into the business of buying and selling houses too. The company announced it was looking to potentially flip homes in the Phoenix and Las Vegas areas, saying in a press release that ‘when Zillow buys a home, it will make necessary repairs and updates and list the home as quickly as possible.’”

“The practice of flipping a home — buying it, fixing it fast and then selling it — can be very lucrative. But it is also risky. That seems to be the reason why shares of Zillow plunged 8% Friday. It didn’t help matters that the company also warned it would lose money in the first quarter — even though it boosted its sales forecasts. Zillow CEO Spencer Rascoff defended the shift in strategy though, arguing that it makes complete sense for Zillow to be involved in buying and selling homes. ‘The days of pushing a button and generating an email to a real estate agent is no longer as magical as it was in 2005,’ Rascoff said.”

From the Tennesseean. “Multi-billion-dollar real estate investment firms own nearly 1 percent of single-family homes in the greater Nashville area and have converted 3,060 houses into rental properties, according to a new study. But, since entering the Nashville market in 2015, their business model has shifted, said Tennessee State University associate professor Ken Chilton. The firms are buying spacious homes near good schools in suburban communities that attract well-educated families with incomes of roughly $75,000. They’ve shifted from buying homes at the lowest-end of the market to snatching up houses for $300,000 and more, Chilton said.”

“The increasing popularity of rental housing is mirrored in the growth of short-term rental companies such as Airbnb. ‘Some people are waking up to find out that 10 homes on their street have been bought out by rental companies in the last five years,’ Chilton said. ‘This is no longer our parents’ or grandparents’ housing market, where a Realtor puts a sign in the yard. Now we’re fighting against the Airbnb people who are competing against the local flippers and the Wall Street flippers.’”

From Bloomberg. “The biggest buyers of leveraged loans are weakening safeguards that limit how much risk they can take, amping up the potential pain for investors when the economy slows. The buyers, known as collateralized loan obligations, are beginning to erode protections in their funds that, for example, prevent them from purchasing too many smaller loans that can be hard to sell later on, according to market participants. The CLOs are dialing down these limitations to boost profits for the money managers that put the complicated structures together.”

“The shifts mean that investments designed to be relatively safe, namely highly-rated bonds sold by CLOs and backed by loans, could end up being riskier than they appear. That has some echoes with structured securities sold during last decade’s housing bubble, which often ended up being stuffed with mortgages that were weaker than investors had expected, even if CLOs are still seen as being far safer than last decade’s collateralized debt obligations.”

“Another relatively new change is the notion of ‘deemed consent,’ according to S&P CLO analyst Sean Malone. To make changes to CLO documents, the manager usually has to track down enough bondholders who agree to the shift. Under the deemed consent principle, if bondholders don’t respond to a manager notice of a change, they are deemed to have agreed. While this provision makes sense in some cases where the burden of getting 100 percent approval is too high, the language opens the door for misuse, according to Vaibhav Kumar of Silverpeak Credit Partners.”

“‘As the CLO documentation went to majority consent, the language was too loose and could be abused down the line by bad actors,’ Kumar said.”

From The Real Deal. “Manhattan isn’t the only part of the U.S. with a slowing luxury real estate market. High-end homes across the country are taking longer to sell, according to a new report by Concierge Auctions. A whopping 72 percent of luxury homes in the U.S. spent more than 180 days on the market in 2017, up from 59 percent in 2015.”

“Westchester County’s market is particularly sluggish. Homes that spend more than 180 days on the market sell for 62 percent of the asking price on average, compared to 71 percent countrywide. Luxury properties in Westchester spend 798 days on the market on average, according to the report, a total only surpassed by Nashville, Cape Cod and Atlanta.”

“Miami homes take 608 days to sell on average, while properties in San Francisco take a paltry 55 days. Beverly Hills luxury homes averaged 347 days on the market while luxury properties in Belair typically stay on the market for 251 days, according to the research. Luxury homes in Palm Beach, Florida averaged 476 days on market.

“In Manhattan, luxury homes priced at $4 million and up spend an average of 359 days on the market, according to Olshan Realty.”

From the Milwaukee Biz Times in Wisconsin. “Milwaukee was one of 53 metropolitan areas that posted a year-over-year increase in foreclosures in the first quarter with a 21 percent increase over the first quarter of 2017. Indianapolis, Indiana led the pack, up 148 percent in foreclosures during the first quarter, followed by Minneapolis-St. Paul, which was up 64 percent; Louisville, Kentucky up 36 percent; Austin, Texas, up 30 percent, and Oklahoma City, up 23 percent.”

“Nearly half, 45 percent, of all properties in foreclosure as of the end of the first quarter were tied to loans originated between 2004 and 2008, according to the report. ‘Less than half of all active foreclosures are now tied to loans originated during the last housing bubble,’ said Daren Blomquist, senior vice president at ATTOM Data Solutions. ‘Meanwhile we are beginning to see early signs that some post-recession loan vintages are defaulting at a slightly elevated rate, a sign that some loosening of lending standards has occurred in recent years.’”

From the Alton Daily News in Illinois. “More than a decade after the national housing crisis, four Illinois communities still have some of the worst foreclosure rates in the nation. Attom Data Solutions’ quarterly foreclosure report shows that Rockford, Peoria, Cook County and the Quad Cities are all in the top 20 metropolitan areas in terms of foreclosures per total homes in the first quarter of 2018. Vice President Daren Blomquist said the housing crisis is so far gone that Illinois’ foreclosure woes can longer be blamed on that.”

“‘[Illinois] loans originated in the last seven years since the end of the Great Recession are performing not as well as the rest of the country and falling into default at higher rates,’ he said.”‘

“At one foreclosure for every 335 homes, the Rockford metropolitan area has the seventh-highest foreclosure rate in the nation. Illinois had the fourth-highest percentage of foreclosed homes in the nation, behind New Jersey, Delaware and Maryland.”

“Bob Nieman, a veteran Rockford real estate agent, said his area’s lagging economy and high property taxes are the biggest reasons for so many bank-owned homes. ‘Add high taxes with high crime and you’ve got an exodus from the state of Illinois and the Rockford area,’ he said, adding that banks are extraordinarily hesitant to list homes that they’re sitting on.”

A weekend topic starting with Delaware Business Now. “Gary Hindes is continuing his battle with the boards of home lenders Fannie Mae and Freddie Mac. Hindes is the managing partner of New York-based Delaware Bay Co. and has been active in Democratic Party circles in Delaware. Delaware Bay specializes in securities of distressed companies like Freddie Mac and Fannie Mae. The two companies package mortgages for sale. to investors. Amid recent press reports that, because of the reduction of the corporate income tax rate which took effect on Jan, 1, Fannie Mae and Freddie Mac may require a one-time Treasury draw, Hindes says any such payments by Treasury should be characterized as ‘a return of stolen money.’”

“Hindes had previously filed suit in an effort to get a better deal for shareholders, reduce principal on debt and thereby boost the value of securities. On September 6, 2008, the federal government seized Fannie and Freddie and placed them into conservatorship. ‘The original takeover wasn’t the ‘bailout’ it purported to be; it was a stick-up,’ Hindes says.”

“‘It was a mafia-type ‘loan’ from the beginning,’ Hindes says. ‘What responsible board of directors – or in this case, a ‘conservator’, no less – would borrow $187 billion and agree that no matter how much money they repay the lender, not a dime can be applied towards principal? I mean, who does that? And here’s a reality check for you: who borrows that kind of money and pays it all back in just four years? Answer: someone who never needed it in the first place. It was ‘cookie jar accounting’.”

“Under the terms of the FHFA/Treasury deal, both companies were to have seen their capitaldrained downto zero by year-end 2017. However, on December 21, Treasury agreed to allow each company to maintain $3 billion in capital. Everything above that will be swept to the government – in perpetuity, Hindes says. ‘The idea all along was to saddle them with a concrete life preserver so that they could not ‘escape, as it were’, Hindes said, quoting from an August 18, 2012 White House email to a Treasury official. ‘And so far, it’s worked.’”

From the Commercial Observer. “Lenders under the umbrella of the Fannie Mae Multifamily Delegated Underwriting and Servicing (DUS) program have been setting records over the last couple of years, stepping to the forefront of the lending arena and delivering substantial amounts of debt across all multifamily property types. Freddie Mac funded 198,000 apartment homes in the third quarter and took on $43 billion in mortgage funding in November 2017 alone, according to a Freddie Mac monthly volume survey.”

“In the current multifamily market environment, that volume and competition could create a problem, and a slowdown may be on the way. Analysts warn of overly competitive markets, stagnant rents in gateway cities, compressed cap rates, plateaued absorption rates and an oversupply of certain assets (such as luxury condominiums) culminating and pumping the brakes on the sector in 2018. Add to the mix the demand to meet millennial taste and you have quite the conundrum cocktail.”

“The amount of outstanding debt guaranteed by Fannie Mae has increased each year since 2013 to $246 billion through the second quarter of 2017—or roughly 20 percent of the market share of outstanding multifamily debt, according to a second quarter debt market report from the agency. Freddie Mac Multifamily—which doesn’t rely on DUS financing and focuses more on home ownership and affordable housing—held 16 percent of the market share to complete a 36 percent piece of the total multifamily debt pie.”

“The Federal Housing Finance Agency (FHFA) twice adjusted the lending caps for Fannie Mae and Freddie Mac in 2016, leading Fannie Mae to set a record for deal volume at $55.3 billion—up from $42.3 billion in 2015—while supporting 724,000 units of multifamily housing—the highest volume in the history of its DUS program. Fannie swiftly surpassed its 2016 record in November 2017, registering $57.7 billion in new business.”

“‘At the beginning of the cycle, lenders like Greystone and Arbor Realty Trust and others recognized the need for multifamily bridge product in order to prepare a borrower or property for agency financing,’ said Joseph Cafiero, the president of New York-based firm CREMAC Asset Management. ‘You can see that [Net Operating Income] growth is in negative territory in some cases and growth in NOI is diminishing in others—through the tapping out on dollars per square foot or because expenses are exceeding the growth of NOI.’”

“‘The bubble has formed, it’s just a question of when it pops,’ Cafiero said. ‘The multifamily sector has long been recognized as the most stable or least volatile sector to invest in. The transaction volume in the sector, availability of cheap debt and extremely low cap rates fueled the bubble. Stagnant NOI growth, especially in the rent-regulated area will eventually lead to significant losses for those properties that experience compression in net cash flow. This will also lead to landlords reducing services they provide to multifamily properties, and then it will be more difficult to keep up properties like they should, which will erode the value of the property.’”

“‘What’s most interesting is the impact of this NOI compression,’ Cafiero said. ‘The point is it’s beginning to look as if the return no longer makes sense for an investor. If you buy multifamily today at a 3 percent cap rate, you’re getting 3 percent return. At some point, you have to charge less management fees and cut costs to maintain a return.’”

“With an oversaturated market in terms of assets and players, banks have been steadily tightening their standards for commercial real estate loans backed by multifamily properties, according to data from the Federal Reserve’s October 2017 Senior Loan Officer Opinion Survey on Bank Lending Practices.”

From the Real Deal. “Multifamily projects have been on the rise across Westchester and Fairfield counties for a while, so much so that sometimes it seems like it’s all anyone can talk about when it comes to suburban real estate. But experts say there’s been a slowdown in construction loans from traditional lenders for these developments in both counties, citing concerns about too much multifamily stock in some markets despite continued strong demand and high occupancy levels.”

“‘The market slowdown started maybe at the beginning of 2016, where lenders were more concerned with saturation in markets that have seen a substantial amount of multifamily growth,’ said Mark Fisher, senior vice president at CBRE. ‘Loan values and loan-to-cost [ratios] have dropped also. Banks that were willing to make 75 percent [recourse] loans are down to 60 percent.’”

“Another concern lenders have is that rents have leveled off, and landlords are increasingly having to sweeten lease terms with incentives. ‘In certain markets, we see one, two or three months’ rent [offered] to new tenants,’ said Marjan Murray, executive vice president for commercial real estate lending at People’s United.”

The Star Telegram in Texas. “A decade after the housing market crashed, foreclosures in Dallas-Fort Worth have slowed to a trickle. Fewer than 1,000 homes are taken each month from owners who haven’t kept up with mortgage payments in the Dallas-Fort Worth-Arlington area. But could they be on the verge of going back up? ‘We’re seeing a little bit of a hint, with increasing foreclosure activity,’ said Daren Blomquist, a senior vice president at Attom Data Solutions, a company that closely tracks foreclosures nationwide.”

“Blomquist is concerned about some small indicators he is seeing in North Texas since this past summer. Foreclosures remain historically low, but Attom Data’s monthly data figures show the number of foreclosures has been higher than the same month a year earlier in five of the past six months. It could be a sign that lenders are going back to their old ways and approving risky loans, he said.”

“‘In five of the last six months, we’ve seen a year-over-year increase (in auctions and bank repossessions) and that kind of pattern does indicate to me that there is some loosening of the lending standard,’ he said. ‘In the peak of the Great Recession, in 2009 and 2010 there was some regulation tightening, but it is gradually starting to loosen and we’re starting to see the result of that.’”

“Home values have skyrocketed 33 percent in the Dallas-Fort Worth area just since 2014, and the median home value in Tarrant County is now $249,000. That’s compared to $188,300 three years ago and $150,900 in 2007 during the housing bust.”

“With values steadily rising, banks may be content to hang on to the vacant properties and simply pay the property taxes until they find a buyer willing to pay top price, said J.R. Martinez, president of the Greater Fort Worth Association of Realtors. As an example, Martinez said one of his relatives lives in Haltom City across the street from a home that was acquired by a bank through a reverse mortgage. It has remained vacant for two years.”

“‘The lady died, and the house hasn’t been occupied for two years now,’ he said. ‘The bank foreclosed on it, but still hasn’t put it on the market. Banks don’t just give the houses away. Even at auctions, just because a house is available at auction and someone makes a bid and gets it, that doesn’t mean the bank will accept it.’”

A report from CNBC on New York. “Manhattan real estate sales and prices took a fall in the fourth quarter, and they’re likely to slide even further this year after the new tax rules take effect. Total sales volume fell 12 percent compared with the fourth quarter of last year — the lowest quarterly level in six years, according to a report from Douglas Elliman Real Estate and Miller Samuel, the appraisal firm. The average sales price in Manhattan fell below $2 million for the first time in nearly two years. The high end of the Manhattan market is showing the biggest cracks. Inventory of luxury apartments — those in the top 10 percent by price — grew by 15 percent.”

“There is now a 17-month supply of luxury apartments in Manhattan, up from 10 months a year ago. And with giant new condo towers sprouting up in every corner of the city, those numbers are likely to grow. Jonathan Miller, president and CEO of Miller Samuel, said that while buyers have already adjusted, sellers may take more time to catch up. ‘The sellers were already recalibrating after 2015,’ he said. ‘Now they will have to readjust again.’”

From Bloomberg. “Manhattan home resales fell in the fourth quarter as buyers wavered ahead of the expected tax overhaul and stood firm in their refusal to overpay. ‘The buyer is very worried about overpaying,’ Steven James, chief executive officer of Douglas Elliman’s New York City division, said in an interview. ‘The fourth quarter was when it absolutely just caught in their throat, where they said ‘No, I’m not going to do it.’”

From the Real Deal. “The last of the legacy contracts from the superluxury boom are closing, and the market is beginning to feel the hangover. The dropoff is largely due to the fact the wave of contracts signed in 2014 and 2015, during the luxury development boom, is coming to an end. That’s evidenced by the much starker declines in the luxury market, where the average sales price slipped 21 percent, from $9.6 million in 2016 to $7.6 million at the end of 2017. In the new development market, the average price fell 17 percent to $4 million.”

“According to a report from Stribling & Associates, the losses in the condo market were unevenly spread throughout the island. Average declines were highest on the Upper East Side and Upper West Side, where the average sales price fell by 15 and 19 percent compared to 2016.”

From New York City Patch. “Prices for the largest, most expensive condominiums and co-operative apartments fell the most, the report found. Co-ops with three or more bedrooms went for 18 percent less on average than a year ago, while large condos went for more than 12 percent less. Sale prices in Manhattan declined throughout the last six months of 2017 after increases in the first half of the year, the report says. The price per square foot in new buildings has been falling even longer. It hit $1,989 in the fourth quarter of last year, down from $2,254 in the fourth quarter of 2016.”

From Curbed New York. “Like the end of 2016, 2017 wrapped with significant political uncertainty and how, exactly, it would affect New York City’s real estate market. The underlying theme through the fourth quarter market reports were questions regarding the latest tax bill. ‘I’m not forecasting the price impact of the tax bill yet,’ Jonathan Miller, the author of Douglas Elliman’s market report said, but he noted that ‘it has more of an effect on the higher end.’ He continued, ‘I expect that in the near future, buyers will come in lower on offers initially and sellers will resist, a repeat of what we have been seeing.’”

“Compass put it most bluntly in its report: ‘The disconnect between luxury inventory and the demands of the market continues to widen.’ Condo inventory priced above $3 million made up 38 percent of condo inventory, but only 25 percent of contracts signed. Co-ops, which tend to be less expensive, became more popular with buyers, who also started negotiating more aggressively.”

From Bisnow. “With all of its debt paid off, 432 Park’s owners appear content with selling off its remaining condos at deep discounts. A buyer from China under the name 432 Park Joy LLC is under contract to buy three units at the tallest residential tower in the world for a total of $91M, The Real Deal reports. Developers Macklowe Properties and CIM Group had listed units 92, 92B and 93B for a total of $120M.”

From Westfair Online. “Several investors have sued companies run by White Plains developer Michael Paul D’Alessio for allegedly stopping payments on three midtown Manhattan condo projects. They fear ‘that there has been a gross misuse of funds,’ according to one of three lawsuits filed on Dec. 22 in Westchester Supreme Court, and unless they can review the books now, ‘it might be too late to seek appropriate relief.’”

“D’Alessio is the head of Michael Paul Enterprises LLC in White Plains. The firm has a 25-year record of building and managing commercial and residential projects, according to its website. ‘My only response,’ D’Alessio told the Business Journal, ‘is that all of the allegations are false and have no basis. I look forward to my day in court to open the books and records.’”

“The lawsuits make essentially the same claims. Investors were promised returns of 10 to 16 percent per year and quick repayment of principal. At some point, payments stopped and D’Alessio cited ‘liquidity’ issues.”

A report from Mansion Global. “The real estate market will be among the sectors most impacted by the $1.5 trillion tax bill passed in the U.S. Wednesday. Many real estate experts have been up in arms about the changes, with the National Association of Realtors (NAR) initially warning that it could lower home prices by up to 10% in every state. An oversupply in luxury housing, plus a limited pool of buyers, has already slowed sales in that sector. And tax woes have only increased hesitation from buyers.”

“‘People are going to be trying to figure out what it means for them,’ said Donna Olshan, president of New York City-based Olshan Realty. ‘It’s certainly not a positive for New York. Almost all my clients pay six figures in New York state and New York City taxes,’ said Ms. Olshan, who has clients in both Manhattan and suburban Westchester, New York. ‘What does that mean for them?’”

The Los Angeles Times in California. “The Republican tax bill reduces the ability of home buyers to deduct mortgage interest, which will be a hit to home shoppers in Southern California and the Bay Area, where housing costs are sky-high. Fadel Lawandy, a director at Chapman University’s Hoag Center for Real Estate and Finance, pointed out that the bill also caps property and state income tax deductions at a combined $10,000 — about $8,500 less than the average deduction taken by Californians in 2015. Combined with the new cap on mortgage interest deductions, that could mean some households will have less to spend on housing, leading to price declines in some wealthy areas, Lawandy said. ‘It will impact the high luxury-end market for sure,’ he said.”

From San Francisco Curbed in California. “It is one more case where the spiraling price of buying in the Bay Area turns values and expectations upside down. Docking the mortgage cap is supposed to be a hit at luxury real estate. However, as Jordan Weissman wrote for Slate, buyers ’stuck house-hunting in San Francisco or New York’ end up swept up by default. Because any new rule aimed at high-end luxury homes is going to hit most of San Francisco—even the teardowns.”

The Houston Chronicle in Texas. “Patrick O’Connor, a Houston-based property tax consultant, said prices in the luxury market could slide by 5 to 10 percent as a result of the smaller mortgage interest deduction. A homeowner with a home assessed at $1 million is expected to pay $3,700 more in federal taxes next year, he said. ‘It makes a difference,’ O’Connor said.”

“The bigger impact in Houston would be the $10,000 cap on property tax deductions, said Jim Gaines, an economist with the Texas A&M real estate center. Texas, which has no state income tax, has some of the highest property taxes in the nation. As many as a quarter of houses in Houston could have property taxes above the $10,000 threshold, Gaines said. ‘Quite frankly, that will be the biggest impact that affects Texas,’ he said.”

The Asbury Park Press in New Jersey. “Congress neared approval of a sweeping tax bill on Wednesday that analysts said could give the economy a short-term jolt, but in New Jersey and other high-tax states could slow down the housing industry. It sparked fears that the bill could cause home values in some markets to take a 10 percent hit, according to a report by Moody’s Analytics. For some consumers trying to decide whether it makes sense to buy a home, or even move, ‘this kind of rejiggers that whole equation,’ said Robert Oppenheimer, the past-president of the New Jersey Association of Realtors.”

“What becomes of New Jersey’s housing market would be a wild card. One grim scenario: It would accelerate the migration of high-income New Jerseyans to other states, which have lower taxes and aren’t fretting over the change. The impact wouldn’t stop there. The slowdown in home sales would ripple through the economy, hurting contractors and home furnishing stores that get a jolt every time a home is sold.”

“‘Maybe New Jersey ought to take a fresh look at our overall tax structure and find ways to reduce the local property tax reliance and shift to broader-based (system) like sales taxes or corporate taxes so you get more people able to take advantage of that $10,000 cap,’ said Peter Reinhart, director of the Kislak Real Estate Institute at Monmouth University in West Long Branch. ‘The deep concern is that New Jersey, already a high-taxed state, will have even higher taxes and will that accelerate people leaving the state?’”

From North Jersey. “The alarm bells are sounding in New Jersey. They have been set off by the new tax reform law Congress approved this week. But it can be a good thing. The new tax bill will have almost zero impact on ‘the working poor.’ Only 40 percent of taxpayers in the state claim the state and local deduction so they are unaffected by the law. The real impact will hurt the suburban middle class – which have been the target of local, county and state politicians for decades.”

“We did this to ourselves – so if state politicians want to be mad at anyone, they should be angry at themselves. Year after year, New Jersey’s property tax burden on homeowners has risen and has been crushing middle-class families and harming business owners for years. Nevertheless, Trenton legislators, school boards and mayors have ignored the taxpayers’ cries for help. Perhaps now – thanks to federal tax reform – we have the impetus we need for a tax revolt in New Jersey unlike anything this state has seen since Jim Florio was dumped out of statehouse.”

A report from the Daily Journal in California. “Cold weather brings a cooling effect to a local rental market which real estate experts believe will remain considerably less expensive than the astronomical rates reached in recent years. Rent for a one-bedroom unit in San Mateo last month floated near $2,500, according to Zumper, down from the yearly peak of nearly $2,600 in June. Last year, prices for similar units were reported as expensive as $3,100. There seems to be consensus on a general market softening. ‘It appears San Mateo County has reached its peak and the county is in a downward trend. In the past two years, rent growth has slowed down and vacancies have increased,’ Rhovy Lyn Antonio, the apartment association’s vice president of public affairs, said.”

“Michael Pierce, a local landlord for more than 30 years, said his stock of older units exposes him to a much less expensive rental market as well. ‘It’s really different,’ he said. ‘It’s not that pie-in-the-sky number that those new buildings are getting.’”

“But even with less expensive offerings than some of the new developments sprouting along the Peninsula, Pierce said he too is witnessing a slowing market, resulting in lingering vacancies and occasional discounts for tenants. Another factor driving the cost drop is the crush of recent residential development becoming available, increasing supply to meet the outsize demand. ‘We are starting to see the benefits from new supply,’ said Pierce, pointing to ongoing construction of developments in Redwood City, San Mateo and Foster City. ‘It’s causing the market to soften a bit because we have a lot of product.’”

From the Virginia Gazette. “The Greater Williamsburg Area has plenty of options to offer home buyers as the fall comes to an end. ‘In the last three months, we’ve seen inventories increase, which indicates the market is evening out. This means the rates of new houses going on the market is outpacing closed sales. It’s a good trend,’ said Kimber Smith, president of the Williamsburg Area Association of Realtors.”

“The median sale price for single-family detached homes was up 5.8 percent to $350,200 and was down 8.1 percent to $229,400 for single-family attached properties since last October, according to the Williamsburg Area Association of Realtors.”

From Crain’s Chicago Business in Illinois. “If you’re looking for a deal on a downtown apartment right now, you shouldn’t have too much trouble finding one. Many landlords are offering prospective tenants two months’ free rent, gift cards and other goodies as they try to fill up their buildings in an overbuilt downtown market. After enduring years of rent hikes, renters are gaining leverage over landlords as the supply of apartments outstrips demand.”

“‘This is the time of year when landlords and property managers get desperate,’ says Maurice Ortiz, director of operations at the Apartment People, a Chicago brokerage. Now ‘it’s an all-out dogfight because there are so many new developments that are competing with each other, as well as the established buildings.’”

“The once-hot market is getting chillier amid an unprecedented development boom. Developers will complete a record 4,500 downtown apartments this year, 3,500 in 2018 and as many as 5,000 in 2019, Integra predicts. While demand for apartments is as strong as it’s ever been, it’s not keeping up with supply. Absorption, the change in the number of occupied units, will total about 2,900 units this year—also a record—and 3,000 in both 2018 and 2019, according to Integra. Put another way, downtown supply growth—13,000 new apartments over three years—will exceed demand by 4,100 units, or 46 percent.”

“The supply surge is making some developers and landlords nervous. That’s one reason they’re offering bigger concessions than they have in the slow leasing months of prior years. ‘The difference now is there’s more fear of the unknown. We’re getting aggressive because you don’t know,’ says Jim Letchinger, president of Chicago-based JDL Development, which opened a 250-unit tower at 640 N. Wells St. over the summer. ‘Is this just seasonal, or is this something else?’”

From Westfair Online on New York. “Housing inventory in Westchester County has reached its lowest level in 13 years, according to a recent report from Douglas Elliman, and while that record-low supply has led to frequent bidding wars in the low- to midlevel markets, the same cannot be said for luxury homes. Real estate professionals agree that a wealth of high-end properties remain for sale. ‘When you start going $1.5 (million) and north, there’s a heck of a lot of stuff on the market and practically nothing selling,’ said Mark Seiden, broker and owner of Mark Seiden Real Estate Team in Briarcliff Manor.”

“Price isn’t the only reason many luxury properties aren’t changing hands. ‘There are plenty of people in the market who I think are overpriced, but we also have plenty of stuff that I think is priced fairly reasonably,’ Seiden said. ‘It’s just that the stuff that’s selling is selling for an ‘oh my God’ low price.’”

From Mansion Global on New York. “A penthouse has been relisted with a massive price cut in a new boutique condo in Manhattan’s Carnegie Hill. The price tag for the penthouse, the largest and most expensive unit in the nine-residence building on 1110 Park Ave., was lowered to $25.95 million Tuesday, more than $18 million, or 41%, less than the asking price three years ago.”

“The penthouse was first listed for $44 million by the building’s developer Toll Brother City Living, when the condo was still under construction in October 2014. The price was dropped to $35 million in early 2015 before the construction was completed that fall. After a year, the developer signed on a brokerage and reduced the price further to $29.95 million in April 2016. In addition to the penthouse, Warburg Realty also re-listed another high-floor unit in the building for $15.95 million last week. The 5,097-square-foot residence was listed for $20 million in 2015 by the developer, Toll Brother City Living.”

“In August, former Avon CEO Andrea Jung sold her apartment in the building, which she never moved into, for $17 million, a loss compared to the $17.616 million she paid in July 2016.”

A report from Bisnow on Virginia. “The Fairfax County submarkets of Reston and Tysons, both emerging areas boosted by the opening of Metro’s Silver Line, have pipelines full of new apartment construction. Several top developers at Bisnow’s Fairfax County State of the Market, worried they might be building too many rental units. JBG Smith Executive Vice President of Development Greg Trimmer said apartment rents in Reston are flat, and in some cases slightly negative, due to the amount of new multifamily construction. But he said the problem is worse in Tysons, where millions of square feet of development is underway around its four Silver Line stations. ‘In Reston we’re a little sick, but Tysons is in hospice in terms of the glut of apartments,’ Trimmer said. ‘They’ve way overbuilt.’”

“Also at the Wiehle-Reston East station, Bozzuto recently delivered Aperture, a 421-unit apartment building. Bozzuto Senior Vice President Mike Henehan said Reston is not alone in welcoming a glut of new apartment buildings, and said the supply surge is becoming the ‘new normal’ across the region. Still, he said Bozzuto has achieved annual rent increases of 1% to 1.5% across its Reston portfolio.”

“MRP Realty principal John Begert said he is optimistic about the area’s future, but does not expect to see notable rent growth in Tysons over the next three to four years, making it difficult to underwrite new apartment projects. ‘If you’re a family office or you have patient capital, in 10 to 12 years you’re going to love it,’ Begert said. ‘But to try to see legitimate rent growth soon, I think you’re kind of fooling yourself.’”

The Miami Herald in Florida. “According to a mid-2017 market study released by the Miami Downtown Development Authority (DDA), rent prices are stable, development is being balanced with demand and financial institutions have raised their requirements for loans — all indicators that the city’s downtown area is on stable long-term footing. Overall, the volume of condo sales was down 50 percent from the previous two years. According to Cranespotters.com, more than 3,600 existing condo units are currently on the market in the downtown area — a 26-month supply (six months is considered the ideal amount of inventory).”

“In other words, it’s a good time to buy. ‘Asking prices are steadying out, and with that kind of inventory on hand, now’s the time to look and find a motivated seller,’ said Chris Zoller, a Realtor at EWM Realty and 2017 chairman of the Miami Association of Realtors.”

From Greenwich Time in Connecticut. “On the surface, Greenwich’s high-end housing market seems to be staging a comeback. These favorable numbers portraying a market on the upswing surprised Jackie Hammock of Coldwell Banker’s Greenwich offices while completing her own third-quarter market report. ‘I started my analysis feeling like the market was terrible in the third quarter, yet when I looked at the overall numbers, everything was good,’ she said. ‘Based on my listings and meetings I’ve been in, it seemed like fewer people were walking around to showings and stuff; yet sales showed the average price was up for the quarter and up for year-to-date,’ Hammock said. ‘So I started digging to see what’s going on.’”

“Hammock said she found 11 homes in the third quarter that sold with ‘huge reductions,’ she said. ‘The more I got into it the more it screamed out to me. Some people were at the point that they had to dump the house.’ An extreme example includes a home on Upper Cross Road for which its owner paid $13.5 million in 2012, according to Greenwich property records, but it closed for just $7.5 million in September. Another property on Lake Avenue was originally listed for more than $10 million, according to Hammock, but it closed for several million less.”

“We did have big sales that pulled up our stats, but it’s when you look at what’s underneath that it’s not as fine,’ she said.”

“Sellers who unloaded their homes for less than they originally listed it, or maybe even bought it for, represent the trend that sellers are finally ‘more willing to meet at market price,’ said Peter Janis of Berkshire Hathaway N.E. Properties. From his experience, many of them ’say ‘It is what it is,’ and move forward because they’re looking at it as a business transaction. They take a loss and move to the next thing,’ he said.”

“While the number of Greenwich homes sold in the third quarter fell by almost 24 percent when compared to last year, an array of high-end sales helped raise the average sale price for the quarter by nearly 21 percent to $2.67 million, as reported by Jonathan Miller in a Douglas Elliman market analysis last week.”

“‘It’s very positive that the market is shedding its disconnect in perceived value at the high end versus what the market is willing to support,’ Miller said. ‘Part of the problem has been a lot of overpriced listings not moving. In all these luxury markets — Manhattan, Westchester, Fairfield, the North Shore and the Hamptons — it’s all the same scenario: all these listings are coming off the market because they were never in the market. The brokerage community continued to list these properties, so they became the perceived market. This is a significant improvement in conditions because what we’re having is an acknowledgment that those homes weren’t priced correctly.’”

The Real Deal on New York. “Manhattan investment-sales volumes continued to fall during the third quarter of the year, setting 2017’s total on course to be lower than it was in 2008 when Lehman Brothers collapsed. Commercial property sales across the borough clocked in at $4.36 billion over the past three months, a 45.4 percent decline from the same time last year, according to third-quarter figures from Cushman & Wakefield. That brings the total for the first three quarters of 2017 to $14.37 billion, or 54.6 percent below the $31.66 billion recorded during the first nine months of 2016.”

“That puts Manhattan on track in 2017 to finish below the $19.8 billion the investment sales market saw in 2008. Sales have slowed to a trickle after the market hit a peak of $59.9 billion in sales in 2015 and started to decline as buyers turned their noses up at paying record prices.”

The Union Tribune in California. “In Southern San Diego County, four sand-colored towers rise up above the natural landscape, a landmark of sorts in a sea of buildings that rarely rise above two stories. Newly built condos in the towers cost less than half of what something similar would cost a half mile away, and the amenities — 24-hour guards, gyms, Jacuzzis, tennis courts — match even the fanciest residential offerings in downtown San Diego. The catch is the condos are in Tijuana and living there means commuting and living in Mexico.”

“Condos start at $170,000 for a 950-square-foot unit and go up from there based on size and location in the building. There are 1,550-square-foot units for $280,000 and 2,000 square-foot units for $315,000. Homeowner association fees are around $200 to $250 a month, and yearly property taxes are about $200. NewCity might have been the first out the gate, but pent-up demand for new residential development in the city has led to a major condo vertical building boom. There are roughly 600 new condos expected to hit the market by the end of this year and most sell out before construction is completed.”

“Even with the ambitious building pace, it does not appear the market is anywhere near being overbuilt, said Gary London, a San Diego-based real estate consultant that also does work in Baja California. ‘There is no historical basis. They haven’t been building a lot of housing for years,’ he said. ‘(600 new condos) does not seem very high, relative to the size of the two metropolitan areas combined. The market is probably quite capable of absorbing more housing.’”

It’s Friday desk clearing time for this blogger. “Changes in the mortgage industry are afoot, with the goal of loosening some of the strict standards established after the subprime crisis — rules some blame for impeding sales. Government-controlled mortgage giants Fannie Mae and Freddie Mac are paving the way by rolling out new programs to encourage home ownership. Also, lenders are moving to relax some standards partly because they fear losing business as home prices and mortgage rates rise, said Guy Cecala, publisher of Inside Mortgage Finance. ‘If your business is going to drop 20 percent,’ he said, ‘you need to come up with ways to offset that.’”

“The trend started in late 2014 when Fannie Mae and Freddie Mac announced new programs that allowed loans with as little as 3 percent down. But many large banks still reeling from the housing bust that cost them billions were skeptical. Bank of America Chief Executive Brian Moynihan said his company was unlikely to participate. But less than two years later, the bank started offering 3 percent down loans through a partnership with Freddie Mac. Wells Fargo, the nation’s largest mortgage lender, also jumped in last year, partnering with Fannie Mae. JPMorgan Chase now offers 3 percent down loans as well.”

“The 3 percent down loans through Fannie or Freddie are capped at $424,100 in most of the country. ‘We are seeing more and more lenders adopting it every day,’ said Danny Gardner, Freddie Mac’s vice president of affordable lending and access to credit.”

“Pilot programs with Guild Mortgage of San Diego and United Wholesale Mortgage of Michigan require the borrower to put down 1 percent of their own money. A pilot through Movement Mortgage allows a borrower to put down nothing. David Battany, Guild’s executive vice president of capital markets, said it launched its 1 percent down program to ‘address the down payment challenge, especially in California,’ where real estate prices are particularly high. It was also struggling to compete with lenders that had previously launched very low down payment options. ‘We were losing business,’ Battany said.”

“If there’s one word that comes up more than any other in the Seattle-area housing market, it’s probably ‘bubble.’ A new survey found 71 percent of Washington adults think a housing bubble is coming. New York, Florida and California residents were the next most likely to fear a housing bubble. George Moorhead, owner of Bentley Properties in Bothell, said the b-word comes up with just about every buyer he represents. ‘They’re getting very wary about a bubble,’ Moorhead said. ‘It is very much a huge concern. The perception is: how long can this go?’”

“It may not be good for his business, but Joshua Hunt, the CEO of local real estate brokerage Trelora, says that for a significant number of people in Denver, including many of those who’ve just moved to the Mile High City, renting makes more sense than buying. ‘We’re already seeing rents drop at higher-end apartments because of the massive increase of available units that have hit the market in the last ninety days or so — and that will continue over the next sixty to ninety days,’ he maintains. Waiting to purchase could be particularly key now, given the boom-and-bust history of Denver’s housing market. ‘Over the past 21 years, I’ve seen it happen twice, and a third time is coming,’ Hunt says.”

“Those woried about chronically stalled luxury property sales at the high end of the Westchester residential market finally have a reason to exhale, thanks to Douglas Elliman’s second-quarter report. Of course, all this movement does come at a price. TRD’s ranking of active listings with the biggest price cuts indicates that brokers are slashing asking amounts by as much as nearly 80 percent in the hopes of luring luxury buyers. ‘Buyers are looking for good value, particularly at the upper end of the luxury market, where we have a larger proportion of inventory,’ said Jim Gricar, general sales manager for Houlihan Lawrence, headquartered in Rye Brook. ‘That proportion of inventory has increased relatively dramatically in the last couple of years.’”

“Toronto in mid-August feels like a city waiting with bated breath. Sales of existing houses in the Greater Toronto Area plunged 40 per cent in July compared with the same month last year, with detached houses leading the decline. ‘Sensing a top, sellers have flooded the previously parched landscape with listings, shifting the market balance toward buyers,’ says Sal Guatieri, senior economist with Bank of Montreal.”

“After months of decline in the London housing market, largely due to prime properties in the center of the city, prices in England’s southeast had their worst performance since 2011, the Royal Institution of Chartered Surveyors said in a survey. ‘Sales activity in the housing market has been slipping in the recent months and the most worrying aspect of the latest survey is the suggestion that this could continue for some time to come,’ said Simon Rubinsohn, RICS chief economist.”

“It was only four years ago that Africa’s richest square mile became the destination of choice for SA’s major financial firms, sparking the largest commercial property development boom of the decade. However, the story is different today. High-end developers are not reaping rewards, as sales of apartments in Sandton have slowed amid falling demand from prospective buyers and investors. ‘Things have changed dramatically. Savvy investors are sitting on their hands at the moment,’ said Kent Gush, MD of Kent Gush Properties.”

“Another problem for high-end developers is faltering off-plan apartment sales. Marc Wachsberger, ‎MD at The Capital Hotel Group, which manages hotel and luxury apartment buildings The Capital 20 West and Empire in Sandton, said off-plan apartment sales have ‘ground to a halt.’”

“The cost of buying property in Sydney has never been higher, but for foreign buyers the sums involved are even more exorbitant with a recently introduced extra 4 per cent stamp duty surcharge and additional land tax. Adding insult to the mounting costs is the the 1 per cent Foreign Investment Review Board application fee introduced in July 2016 that has hit the rarefied trophy market of the eastern suburbs, according to Bill Malouf, of LJ Hooker Double Bay.”

“McGrath’s Michael Coombs said while foreign buyer demand remains strong, he had two deals in the $10 million to $20 million range fall over in recent weeks after the buyers calculated the extra costs of buying in Australia. ‘In both cases they’re reassessing if they want to buy in Australia or take their money elsewhere,’ he said.”

“Has the crash finally started? Barfoot and Thompson’s July sales report showed the average sale price for an Auckland Eastern suburbs home was $1.117 million in July, compared to $1.193m in July last year. In the North Shore the average price was down from $1.3m to $1.06m. In South Auckland, it was down from $824,069 to $708,069. Is China’s crackdown on money leaving the People’s Republic causing the crunch? Are anti-money laundering laws finally working? Have the Reserve Bank’s high deposit-for-investor rules knocked them out of the game?”

“Whatever the reasons, some people who bought recently now own homes worth less than they paid for them. A tragic few may even be in negative equity, when the value of their home minus the cost of selling it (real estate fees, advertising, lawyers, etc) is less than is needed to repay the mortgage. Large numbers of Britons have had to learn to live with negative equity after a boom was followed by a lasting bust. If prices keep falling some Aucklanders may find themselves in a similar boat.”

“Negative equity is depressing for a homeowner. It means they have gone backwards. In the short term, negative equity only really becomes a problem for a homeowner if they have to sell, remortgage, or want to borrow more. Banks don’t want new borrowers with negative equity. Even people with less than 20 per cent equity aren’t prime borrower to a bank. And (economists shudder) small business loans are secured against home equity.”

“Long-term negative equity is a personal nightmare for homeowners. It traps them, and is a rankling symbol of how they are a victim of failed markets, failed government policies, and other people’s profiteering. Ironically, that’s exactly how many renters feel.”

A report from the Aurora Sentinel in Colorado. “Tales of distraught would-be homeowners unable to snatch a dream home in Colorado’s scorching-hot housing market are more common these days than a weed shop on Colfax. Renters in metro Denver feel that pinch just as acutely. But, experts say, there has been some relief as landlords dish out a variety of discounts aimed at blunting those ever-rising rents and luring savvy renters always looking for a deal. Teo Nicolais, a real estate instructor at the Harvard Extension School and volunteer at the apartment association, said the bulk of those concessions come in the form of a free month of rent spread over the course of a lease. And the concessions aren’t limited to a free month, Nicolais said. Some landlords have offered free parking passes or discounts on pet deposit fees.”

“Last year saw a record number of new apartments built across the metro, he said, and 2017 is on pace to smash that record by more than 25 percent. That means lots of inventory out there and landlords eager to fill brand-new buildings that are usually empty the moment construction wraps. ‘If the property down the street from you is offering one month’s free rent, you need to offer it too,’ he said.”

From Curbed San Francisco in California. “San Francisco is building more, everybody agrees on that. But how much is more—and for that matter, how much is enough? The apartment rental site RENTCafe tapped research firm Yardi Matrix to take stock of the city’s new housing stock last week. And the numbers look superficially good: The Bay Area as a whole should yield 5,415 new apartments by the end of this year, with 1,860 in San Francisco itself.”

“The catch is, Yardi Matrix says that rate of construction is down 12 percent year over year. And in San Francisco it’s down 48 percent. Last year the Bay Area-wide product came to almost 6,200, which RENTCafe credits with putting the skids on space shuttle-velocity rent increases. ‘While demand is still strong in the city, this flood of new rentals [put] a damper on incessant rent growth,’ RENTCafe’s Ama Otet writes.”

From My San Antonio in Texas. “A real estate firm from Chicago purchased the $42 million Axis at the Rim luxury apartment complex last week. Sherman Residential bought the 10.5-acre, 308-unit complex from Trinsic Residential Group of Dallas, which finished building it about six months ago, said Scott Gould, Sherman’s senior vice president. Despite the apartment complexes being built around The Rim, Gould said he thinks the area will soon be built out — in other words, there isn’t a risk that droves of new apartments will flood the market and drive rents down.”

“‘We think the long-term prognosis is very strong for the area,’ he said. Real estate investors have purchased roughly 40 apartment complexes in Bexar County since the beginning of the year, property records show.”

The Real Deal on Florida. “The Boca Raton Planning and Zoning Board approved a plan for an upscale, 193-unit assisted living facility to be developed by Penn-Florida Companies in downtown Boca Raton. Developers are increasingly turning from condo development to apartments, amid slumping condo sales, which could eventually lead to a glut of rentals, experts say.”

“Jack McCabe, CEO, McCabe Research & Consulting in Deerfield Beach, said about 10,500 apartment units have been completed in South Florida in the last 18 months, and another 18,000 apartments are scheduled to be delivered during the next two years. Early this year, a Miami Downtown Development Authority report showed that Greater Downtown Miami will see more rental apartments delivered than condominiums in 2017 for the first time ever.”

From WDAZ on North Dakota. “More apartment complexes going up in Grand Forks. While some existing buildings remain almost completely vacant. Calsey Langston, ‘A quick google search comes up with fifty apartment complexes or property management companies in Grand Forks, but check this out, apartments.com shows 590 apartments available in our city and there’s about to be even more.’ A property manager from an older company wouldn’t go on camera, but he tells me, in one of their buildings, they have six vacant units. In another complex, twenty-eight units are sitting empty.”

“According to the Grand Forks city website, vacancy in town is at more than eight percent. This spring, one-bedroom apartments had the highest vacancy rate in five years. For two-bedroom apartments it’s a six-year high. But there are five more approved apartment buildings awaiting construction. ‘There is still a need for more housing like a lot of our buildings are absolutely full so I suppose if they’re building more, there’s a need for more apartments,’ says Garett Sondrol, Oxford Realty.”

“It’s still in question whether or not the demand will keep up with the over-supply.”

From Bloomberg on New York. “A pair of high-rise apartment towers is set to replace a decrepit parking deck in New Rochelle, extending the New York suburb’s effort to draw younger residents. In the past six years, developers have built or proposed 50 Westchester County residential projects within half a mile of a Metro-North station, to add 11,231 apartments.”

“Whether there’s demand for additional workspace may be questionable in a county where the office-availability rate has hovered close to 25 percent, about twice that of Manhattan, says brokerage Newmark Knight Frank. Even in the apartment market, Westchester is edging toward being overbuilt, with more than 1,000 rentals in the county’s pipeline for this year, according to Barbara Denham, senior economist at research firm Reis Inc. Vacancies are projected to rise to 4.4 percent this year, from 2.9 percent in mid-2016, Reis data show. ‘I think the market can absorb these units, but not 100 percent,’ Denham said.”

From Bisnow on New York. “A critical mass of new apartment buildings is opening in New York City, and developers are conceding more and more to renters in an effort to lease them up. Concessions — the industry term for free rent — by building owners were the second-highest on record, and nearly triple that of a year ago. At the same time, the inventory expanded for the 22nd month in a row. Renters are aware developers are scrambling, so the number of people shopping for discounts is increasing.”

“A new Yardi Matrix report found that New York has 26,739 units under construction, 7.8% of all housing units coming in the entire U.S. But developers can’t build these apartments fast enough, at the right price points, to make them affordable for all New Yorkers. In 2018, Citi Habitats says Manhattan will gain 4,442 apartments and Brooklyn an astonishing 10,581 as developers rushed to meet the demand of 2015 and 2016. By 2019, the number of units levels off to 3,425 in Manhattan and 6,791 in Brooklyn.”

“There are also more condominiums opening, and some of those will have investor units that will also compete in the rental space. That is why the competition is fierce to get the prospects to sign those leases. Citi Habitats President Gary Malin said owners can draw the line on the rental number and get 25 apartments leased, or give up some concessions and get 50 apartments occupied in the same period to start bringing in the rent money. ‘With a new building, you want to lease up as fast as you can,’ Malin says. ‘The market changes very quickly.’”

“The problem for investors, developers and the one-off owner: There are simply too many apartments on the market to keep prices soaring, and more are coming.”