Forget Mansions, Homebuyers Really Want Yurt Mentions In Their Infographics
I should have titled this week’s Housing Notes as “readers like housing infographics because there is little thinking needed.” I’ve always seen infographics as a way to “cheat” social media with some sort of shiny filler content that makes it look like there was a thoughtful effort made. We are never told who specifically created the infographic and we assume the content creator accurately conveyed the information or had a strong artistic sense of nuance to properly convey it. In other words, I see them as one step removed (or diluted) from the source info. An emulator of sorts. I’m probably too cynical over this type of medium, but let’s talk ‘Yurts.”
Because readers of Housing Notes obsess about all things real estate, Chase Home Lending worked with Google and found that the second highest housing style people search for are Yurts. It’s on the internet so it must be true. In related news, Chase Home Lending, a subsidiary of America’s largest bank, whose CEO Jamie Dimon went berserk this week was really referring to our love of Yurts memorialized in infographics. Skip to the middle.
but I digress…
Week 3 of Q2 Housing Market Report Gauntlet [CT & SoFL Edition]
Douglas Elliman published my firm’s research on the Connecticut markets of Greenwich and Fairfield County, as well as their South Florida foot print of Miami (Beach and Mainland), Boca Raton, Fort Lauderdale, Palm Beach, Wellington, Delray Beach and Jupiter/Palm Beach Gardens. I’ve been the author of this growing Elliman report series since 1994.
Greenwich, Connecticut continued to show improvement, largely because high-end sellers, after a decade of being disconnected with value and holding on to the Wall Street boom times that created the market, pre-housing bubble, are capitulating. And Wall Streeters are interested in the topic as the Bloomberg story on the topic that included our findings was the 7th most read and 5th most emailed story on the Bloomberg Terminals world wide.
Luxury Greenwich inventory is falling, and that’s good for the health of the market in the long run. Sellers that wildly overpriced are letting their listings expire or are coming way down to meet the seller:
The Bloomberg piece notes:
Among properties that sold in the quarter was an 8,535-square-foot (793-square-meter), six-bedroom home on Khakum Wood Road that had been on the market since 2008. Back then, the home, on 2 acres (0.8 hectares) with a pool, was listed for $14.5 million and didn’t sell, according to Greenwich’s property listing service. It returned to the market several times since — at $9.975 million, $7.645 million and, most recently, $6.65 million.
The home finally sold in April for $5.8 million, or 60 percent less than its 2008 price.
Douglas Elliman published 8 South Florida market reports I authored this week that shows all markets are in generally better shape than last year and some are standouts. Most markets remain “softer at the top” but the remainder, especially moving towards lower price points, are moving very quickly.
The links to all the market reports can be found below. Their press release presents the highlights for each of the markets.
Kale salad on rooftops and the NYC Housing Market
I had a fun and spirited discussion with Tom Keene and David Gura on Bloomberg Radio about a little bit of everything, namely NYC and national housing along with kale salad as I fought off a cough.
I’m the middle interview and it starts around 29:00.
NAR says foreign buyer purchases jumped nearly 50% to new record
Canadian and Chinese buyers were key factor per WSJ.
Here are a series of quotes from the COO of Juwai, the top Chinese international property portal, on the report:
In 2016 Chinese investment in international and U.S. real estate hit a historic high. While we think the dollar amount is likely to decline somewhat this year, investment levels are still in the foothills of this mountain range. There are higher peaks ahead.
This year, international real estate investment will be down at least 10% from 2016, according to present trends.
Chinese buyers trust the American market and believe it is a long-term safe bet. The US is also the most popular destination for Chinese immigrants, students, and corporate investment. All of these factors drive property acquisitions.
After the United States, the top destinations for Chinese investment are Australia, Thailand, Canada and the UK.
While I don’t question the large influx of foreign buyers this year, I suspect the jump is not as large as this as evidenced by the lack of New York representation as a top 5 state. This is because NAR has little membership or access to information in Manhattan – characterized by the highest housing prices in the U.S. and a very heavy concentration of Chinese buyers. If NAR had Manhattan access, last year would be higher than this year. That would have the affect of lowering the U.S. year over year change.
Too soon for any kind of housing reform
There’s a great article from PIMCO on the problem with housing finance right now. This has always been my key view:
We believe the decline is directly related to the inability of many quality borrowers (those who have consistently paid their bills and have the financial means to borrow) to access mortgage credit. While many people expected – and desired – a retrenchment in mortgage credit after the frothy days of 2005–2007, many quality borrowers are still unable to secure a mortgage nearly nine years after the financial crisis.
Here’s what Matt Klein of BV called out on twitter as critical. I agree.
Free parking isn’t free
I continue to be obsessed with this topic of how free parking is not free for cities and suburbs and stifles their growth. Here’s a good Vox video on the topic:
Housing sold separately from land
Like children’s toys, the batteries that make them work are often sold separately. Ardell DellaLoggia, Seattle area Realtor, prolific blogger, Quora question answerer and one of my favorite people online, shares this on her Facebook page.
New development marketing groups play musical chairs
In soft housing markets (NYC high end) with new development projects that have a pricing disconnect with actual conditions, we tend to see a lot more turnover of new development marketing groups. Just like an individual home seller anchored to a higher list price than their market can bear, there is a period of mourning a seller must go through until they face the reality that the pricing isn’t right.
I am noticing a lot more NYC new dev marketing group turnover these days as developers are coming to the end of this mourning period that began in late 2014/early 2015. Sure, marketing skills are important to the success of a new project, but if the pricing is out of whack, there isn’t much that can be done unless you can wait for the next cycle to appear.
Diners RULE in my book
This is a quasi-housing market-related topic. I love diners. One of the first things my wife and I did when we arrived in Manhattan was go to the Cosmic coffee shop just off of Columbus Circle and have breakfast. City life was a lot grittier back then, especially the subways. It was early in the morning and the waiter came up to us, with a half unbuttoned short and barked, “what do you want?” Having just arrived from the midwest, we stumbled through our order but noticed he wasn’t writing anything down. The food came back to us in 5 minutes and was perfectly prepared. I was hooked. During my 31 year career as an appraiser, I constantly sought out old diners and coffee shops for breakfast and lunch – knowing their days were numbered as rents seemed to rise faster than inflation. Cosmic is gone and I have lost some others but I feel I am biding my time. New old-style diners are off limits to me. I want to sit at the worn Formica counter and hear the waiter yell to the cook, “whiskey down, burn it!” You can’t get much more New York than that.
Since I released 10 market research pieces this week I have been slow to return phone calls and emails from my appraiser colleagues – my apologies. I have 5 more this week and then life is back to normal. So I’m a little light on granular this week.
Surveys Can Be Useful or a Complete Waste of Time
[Surveys] can be very helpful in determining what people are really thinking about. They can also be a tool to placate angry customers to feign some sort of future action on the existing problems. Next week I’ll share the questions presented by AI National from their “McKinley” survey to those that weren’t sent one.
It is hard not to be cynical these days but my assumption is that this survey was done to fog the upcoming governance action in which AI National seemingly plans to drop chapters regions and the “taking” that caused an uproar last fall.
[Evaluations] as an appraisal issue is dead but AI National keeps it on life support. I know of senior AI people reaching out to thought leaders outside AI about how wonderful it is to have the option of doing $25 evaluations. They still don’t grasp how badly this will confuse the marketplace with infinite multiple standards across the 50 states and beyond. It’s very sad.
[Conclusion] I believe we are very close to the point where AI National actions can be ignored and we can focus on real issues that will impact the future of the appraisal industry. Their membership is now very much on top of what they are doing. I just don’t want AI National to be a distraction anymore in our fight against misinformation and our industry’s survival.
Rural appraisal bill is believed to be DOA
I heard from a reliable source that the proposed appraisal bill in this article that would impact rural appraisers was DOA.
Housingwire Webinar Redux
If you’re not busy, join us on July 26th.
A Brilliant Idea
If you need something rock solid in your life (particularly on Friday afternoons) and someone forwarded this to you, or you think you already subscribed, sign up here for these weekly Housing Notes. And be sure to share with a friend or colleague if you enjoy them. They’ll watch Big Bird do a Beastie Boys song, you’ll learn not to eat on planes and I’ll still refuse to put ketchup on my hot dog.
See you next week.
Jonathan Miller, CRP, CRE
Miller Samuel Inc.
Real Estate Appraisers & Consultants
Reads, Listens and Visuals I Enjoyed
- The Heartbreak of a Co-op Rejection [NY Times]
- What are homebuyers really searching for? Google gives us the answer, literally [Housingwire]
- Foreign Buyers Pump Up U.S. Home Prices [WSJ]
- Housing Finance Reform: First Things First [PIMCO]
- Foreign U.S. Home Sales Dollar Volume Surges 49 Percent to Record $153 Billion [NAR]
- The high cost of free parking [Youtube]
- Phoenix condo owner finding out the system is flawed [The Phoenix Real Estate Guy]
- Jacqueline Kennedy Onassis’s childhood summer home in East Hampton, N.Y., lists for $52 million [Washington Post]
- Julio Iglesias asks $150M for 4 homeless Miami lots [Miami Curbed]
- Why Washington can't fix the new housing crisis [Politico]
- Philly must add 38K apartments by 2030 to meet rising demand, study finds [Curbed Philly]
- Deadline day: Corcoran, Citi Habitats say they've cut StreetEasy rentals off – here's what the others are doing [The Real Deal NY]
- Greenland Forest City swaps Corcoran for Nest Seekers at 550 Vanderbilt [The Real Deal New York]
- The Real Reason Jamie Dimon Went Berserk About America’s “Stupid Shit” [Vanity Fair]
- Frances Gabe, Inventor of the Self-Cleaning House, Dies at 101 [NY Times]
- Short-Term (Airbnb) Rentals Are Not Only Illegal But Also Now More Costly [Gallet Dreyer & Berkey]
- A Sailor’s Dream House in Emsworth, U.K., Hits the Market for £3.4 Million [Mansion Global]
- Dallas mortgage company Ditech to layoff nearly 500 [Dallas Biz Journal]
- CFPB Final Rule Clear on Ability to Share Closing Disclosures [NAR]
- U.S. Seeks One57 Condo Cash in Nigerian Oil Corruption Case [Bloomberg]
- New U.S. Subprime Boom, Same Old Sins: Auto Defaults Are Soaring [Bloomberg]
- Zillow shares slump as Amazon webpage hints at expansion into real estate referrals [Geekwire]
- Detroit at crossroads 50 years after riots devastated city [AP]
- How do you know when we are in a Real Estate Bubble [Ardell DellaLoggia]
My New Content, Research and Mentions
- 2Q – 2017 Jupiter / Palm Beach Gardens Sales Market Report [Douglas Elliman]
- 2Q – 2017 Delray Sales Market Report [Douglas Elliman]
- 2Q – 2017 Wellington Sales Market Report [Douglas Elliman]
- 2Q – 2017 Palm Beach Sales Market Report [Douglas Elliman]
- 2Q – 2017 Fort Lauderdale Sales Market Report [Douglas Elliman]
- 2Q – 2017 Boca Raton Sales Market Report [Douglas Elliman]
- 2Q – 2017 Miami Coastal Mainland Sales Market Report [Douglas Elliman]
- 2Q – 2017 Miami Beach / Barrier Islands Sales Market Report [Douglas Elliman]
- 2Q – 2017 Fairfield County Sales Market Report [Douglas Elliman]
- 2Q – 2017 Greenwich Sales Market Report [Douglas Elliman]
- Q2 2017 South Florida Sales Market Reports [Citybizlist]
- South Florida's resi markets are slowly improving: Elliman [The Real Deal So Florida]
- Julio Iglesias Lists Eight-Acres On Miami's Indian Creek Island For Record $150 Million [Forbes]
- Second-quarter sales reports: Palm Beach real estate action brightened [The Shiny Sheet]
- Buyers Lean Toward Affordable Luxury in South Florida [Mansion Global]
- Luxury Homes in Greenwich, Connecticut, See Double-Digit Price Rise [Mansion Global]
- Greenwich Luxury Listings Tumble as Sellers Discount or Drop Out [Bloomberg]
- Living inside history: What it's like to own—and update—a landmark property [Brick Underground]
- Happy Medium on the East End [Long Island Pulse]
- Audio: Miller – credit hasn’t normalized for mortgage lending [Bloomberg Radio]
- Is it time to rejoice when Trader Joe's hits your neighborhood? That depends… [Brick Underground]
- The Million-Dollar Manhattan Apartment [Luxury Standard]
Appraisal Related Reads
- HW Webinar: Your Appraisal Questions, Answered [Housingwire]
- When using older sales is the best option [Sacramento Appraisal Blog]
- How agents can use multiple offers to help the appraiser [Birmingham Appraisal Blog]
- Legislation will alleviate rising costs and delays in the process of obtaining a mortgage through reduced regulatory burden [WGNS Radio]
- Louisiana repealing controversial appraisal laws after FTC accused state of price-fixing [Housingwire]
- ASA and NAIFA Express Support [ASA]
- The Future of Appraisal: It’s Not Simple [NAR]
- Did Quicken Loans ‘cook’ homeowners’ appraisals? Feds say yes [Miami Herald]
Extra Curricular Reads
- Watching and Lamenting the Death of the New York Diner [Grub Street]
- Why You Should Never, Ever Eat Food on Planes [Bloomberg]
- Microsoft Pushes to Take Over Russian Spies' Network [The Daily Beast]
- S. Jhoanna Robledo: 1970 – 2017 [Brickunderground]
- The Slow Death Of NYC Diners [WNYC]
- Heinz trying to woo Chicagoans to do the unthinkable: Put ketchup on their hot dogs [Chicago Tribune]
- The Urban Lens: Tour the grimy and crime-ridden subway of 1981 [6sqft]