Migration Patterns For Housing Turned Out To Be A Joke?
I referred to Monty Python for clarity when reading the new Census numbers on migration (more further down the page):
But I digress…
The ‘Great Migration’ May Not Have Happened?
Something happened, but apparently, it wasn’t what we thought it was.
The U.S. Census numbers conflict with projections used over the past decade and really throw questions at the “fleeing the city” narrative of the post-pandemic world. Another thought is that migration data sucks more than we realize.
In the CS Monitor’s piece: No ‘great migration’: Americans stayed put during pandemic
New figures released Wednesday by the U.S. Census Bureau show that the proportion of people who moved over the past year fell to its lowest level in the 73 years that it has been tracked, in contradiction to popular anecdotes that people left cities en masse to escape COVID-19 restrictions or in search of more bucolic lifestyles.
…and this epic Curbed piece: More People Are Moving to New York Now Than Before the Pandemic
…which breaks out and explains four different points:
- Wealthy Neighborhoods Saw the Most People Leave
- Most People Who Did Flee Didn’t Go Very Far
- The Neighborhoods That Almost No One Left
- Who Ultimately Came Back?
2021 Will Be A Record Year For High-End Hamptons Sales (And The Year Isn’t Over Yet)
This week’s record Hampton’s sale for $70 million was the fifth sale at or above the $50 million threshold and the highest since Ron Baron’s 2007 sale first cracked the threshold in 2007 for $103 million.
Fannie & Freddie Decided To Raise Conforming Loan Limits in 2022 To Keep Volume High
Housing prices are rising at record rates so the GSE (Fannie & Freddie) conforming loan rate limit (the highest mortgage amount that the GSEs will back in “High-Cost Areas”) will be raised to nearly $1 million in 2022.
At first glance, this seems harmless. Housing prices have been rising at record rates given record-low mortgage rates. In addition, mortgage rates for loans under these thresholds are generally lower than above the threshold, often as much as 0.5%. Mortgages above the conforming loan limits are called “Jumbo” and the GSEs don’t touch them but they are a significant part of the mortgage market.
The current one unit conforming loan limits are here:
I’d like to point out that while the GSEs are responding to rising housing prices with this move, they have never dropped the conforming loan rate when prices decline, such as the ±30% drop during the great financial crisis. I think the actual reason is to keep the mortgage pipeline full, a similar GSE mindset observed during the financial crisis. Still, I don’t see this as creating “bubble” conditions but it is something that should not be done to let rising price growth cool off.
I think this GSE strategy will facilitate more price growth as more mortgages now qualify for a lower mortgage rate.
While the general loan limit for single units is currently $548,250, the “High-Cost Area” max is $822,375 like NYC metro, the GSEs plan to raise the latter to close to $1 million in 2022.
1941 NYC Mayor Fiorello La Guardia Implores Real Estate Appraisers To Testify On Behalf Of The City
From the NYPR Archive Collection on WNYC’s Web Site: LaGuardia’s November 19, 1944, weekly broadcast. The best part about the broadcast description is this: “This episode is from the WNYC archives. It may contain language which is no longer politically or socially appropriate.”
If you want to skip the commentary about Hitler’s brain clot, recommendations to use honey for baking during the severe war rationing of sugar, then go to the 10:25 mark, you’ll hear about the Real Estate Board of New York protest. LaGuardia said the city wouldn’t hire any real estate experts to testify on the city’s behalf if they have ever testified against the city in certiorari or condemnation proceedings. It’s fascinating logic and he makes the argument all about him. The money doesn’t come out of his pocket but takes full responsibility for his position on experts. I suspect the valuation experts favor public clients over the city as a client due to the substantial compensation difference that free-market behavior incentivizes.
He says these valuation experts are not “factual” witnesses but rather provide “his” experiences. Valuation was a men’s-only industry at the time, although the appraisal profession is currently comprised of less than 30% by women.
Billionaire Investor Bill Ackman Can Be Outspoken But A Housing Suckup When He Needs To
In this week’s Bloomberg piece Bill Ackman Told to Rework Plan for Glass Penthouse on NYC Tower.
Ackman is building a “Malibu style” house on top of a pre-war building and the New York City Landmarks Preservation Commission did not vote on whether he could go ahead with the project. He said a very Un-Ackerman thing:
At Tuesday’s hearing, Ackman said he scrapped an earlier plan that was too visible and spent the past two years working up the current design with the aim of being more thoughtful and subtle.
This is the Bill Ackerman we all know.
One of the key reasons that Manhattan real estate is so expensive, is that the effort, expense and time it takes to navigate the municipal labyrinth is limited to a handful of people. I’m not against things like Landmark designations whatsoever, but it does come with a cost.
‘Persistant’ Overpowers ‘Transitory’ Inflation Talk By The Fed
Liz Ann Sonders, Chief Investment Strategist, Charles Schwab & Co., Inc. makes everyone smarter. I always enjoy her ability to parse out economic details at a digestible level for mere mortals.
Minneapolis Fed President Neel Kashkari also applies logic to the inflation discussion.
My favorite charts of the week of our own making
My favorite charts of the week made by others
recovery in the labor market in the US so far 👇 pic.twitter.com/h7XLQsfl3M— Ben Bakkum (@BenBakkum) November 16, 2021
Do people realize that immigration to the U.S. has dropped by half just since 2016? pic.twitter.com/OEqi3Usiso— Noah Smith 🐇 (@Noahpinion) November 13, 2021
Len Kiefer‘s Chart Handiwork
(For earlier appraisal industry commentary, visit my old clunky REIC site.)
It Looks Like West Virginia RE Appraisal Board Chair Dean Dawson’s Behavior Caught Up With Him
Essentially, appraisers have had no voice for two decades except one time in 2009 and that was a dysfunctional period. The state auditors have seen enough. There is now hope that new licensees will be able to enter the profession and the WV board’s self-dealing will be stopped. What a nightmare this has been for appraisers in West Virginia.
The board has not complied with USPAP since 2009!
More to come!
South Dakota’s Governor’s Daughter Will Turn In Her Appraisal License
There is nothing worse than seeing someone caught in the act of nepotism, then blaming the media for it. For those of you that have been following the South Dakota appraiser debacle, the Governor’s daughter says she can’t go on as an appraiser because her good name was damaged. This makes no sense to me – it’s got to be a political strategy concerning her mother’s bid for reelection.
Because I get all my hard-hitting appraisal industry from People Magazine…S.D. Governor’s Daughter Quits in ‘Disappointment and Anger’ as Officials Look at How She Got Her Job:
“I’m writing to you today to express my disappointment and anger that my good name and professional reputation continue to be damaged,” Kassidy Peters said Tuesday. “It is clear that none of this will stop until my reputation and that of my young family are destroyed”
As more information comes out, I am pretty positive this will not be the actual reason she left the industry. I mean, why was she sitting in the room with her mom the governor, the real estate appraisal license head who was pushed out shortly after, and the labor secretary?
1941 NYC Mayor Fiorello La Guardia Implores Real Estate Appraisers To Testify On Behalf Of The Cit
Take a look at my post earlier (above) in these Housing Notes for those of you that usually skip down to Appraiserville (Like my friend Ernie does).
OFT (One Final Thought)
Is the housing market going to Turn, Turn, Turn? Sort of.
Brilliant Idea #1
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Reads, Listens and Visuals I Enjoyed
- More People Are Moving to New York Now Than Before the Pandemic [Curbed]
- No 'great migration': Americans stayed put during pandemic [CS Monitor]
- Why this corner of the West Village is the real Billionaires’ Row [NY Post]
- UWM waives MI with a 10.01% down payment, but there's a catch [HousingWire]
- Fed Begins Taper with Inflation in Focus [Fannie Mae]
- Kastle Systems – Data Assisting in Return to Office Plans [Kastle]
- Home price growth paused in October [House Price Index]
- Housing Predictions: Guesses and the Data [Calculated Risk]
- FHFA tells GSEs to prioritize affordability in 2022 [HousingWire]
- ‘So Much Ugliness’ as Upper East Siders Battle 16-Story Tower [NY Times]
- What Went Wrong With Zillow? A Real-Estate Algorithm Derailed Its Big Bet [Wall Street Journal]
- Analysis | The government dramatically underestimated job growth this summer [Washington Post]
- Bill Ackman Told to Rework Plan for Glass Penthouse on NYC Tower [Bloomberg]
- Chicago Dubbed ‘Forever Rat Capital in the US’ [The Real Deal]
- Avi Dorfman’s legal battle to be named founding member of Compass has ended in a settlement [TechCrunch]
- Bubblicious: Crypto Euphoria’s Emerging Impact on Housing [John Burns Real Estate Consulting]
- Condo Sales Are Soaring All Over Manhattan—Except Midtown [Bloomberg]
- Fannie Mae, Freddie Mac to Back Home Loans of Nearly $1 Million as Prices Soar [Wall Street Journal]
- The Pandemic’s Impact on NYC Migration Patterns [Comptroller NYC]
- Business Leaders Survey [FEDERAL RESERVE BANK of NEW YORK]
- The hot real estate market creates a 'big squeeze' for those between sales [Newsday]
- U.S. Single-Family Rental Price Increases Topped 10% in September [Bloomberg]
- Property Investors Bet $64 Billion on U.S. Homes in Record Buying Spree [Bloomberg]
- The hot new amenity for co-ops and condos? Green space. [Habitat Mag]
- China's new home prices in Oct fell by the most since February 2015 [Yahoo Finance]
- Hong Kong Condo Sells For Record $18K-Per-Square-Foot [The Real Deal]
- Will Real Estate Ever Be Normal Again? [NY Times]
My New Content, Research and Mentions
- Los Angeles Home of Thomson Reuters Publishing Heiress Hits the Market for $43 Million [Wall Street Journal]
- Hamptons Beachfront Home Sells for $70 Million [Wall Street Journal]
- Want More Space in Manhattan? Buy a Co-Op [Mansion Global]
- From Manhattan to the Middle East, the Top New Restaurants Are Truly Massive [Architectural Digest]
- New York City Townhouse Sells for $22.5 Million [Wall Street Journal]
- The U.S. Government Plans to Back Much Higher Mortgages. It Could Actually Be a Blow to Buyers. [Barron's]
- The U.S. Government Plans to Back Much Higher Mortgages. It Could Actually Be a Blow to Buyers [Mansion Global]
- A New York Penthouse Sells for $49 Million, Setting a SoHo Record [Wall Street Journal]
- Los Angeles Home Lists for $24.95 Million [Wall Street Journal]
- New York City Property Values in Limbo Amid Market Changes? [Commercial Observer]
- To Dispel the Property Crisis, China Has to Tame Two Types of Bad Borrowers [Bloomberg]
- NYC drops out of top 20 most expensive ZIP codes [Daily Mail]
Recently Published Elliman Market Reports
- Elliman Report: Manhattan, Brooklyn & Queens Rentals 10-2021 [Miller Samuel]
- Elliman Report: Normandy Isles/Normandy Shores New Signed Contracts 10-2021 [Miller Samuel]
- Elliman Report: California New Signed Contracts 10-2021 [Miller Samuel]
- Elliman Report: Colorado New Signed Contracts 10-2021 [Miller Samuel]
- Elliman Report: Florida New Signed Contracts 10-2021 [Miller Samuel]
- Elliman Report: New York New Signed Contracts 10-2021 [Miller Samuel]
- Elliman Report: Malibu + Malibu Beach Sales 3Q 2021 [Miller Samuel]
- Elliman Report: Los Angeles Sales 3Q 2021 [Miller Samuel]
- Elliman Report: Long Island Sales 3Q 2021 [Miller Samuel]
- Elliman Report: Hamptons Sales 3Q 2021 [Miller Samuel]
Appraisal Related Reads
Extra Curricular Reads
- Estimated Revenue Effects of Increased Funding for the Internal Revenue Service in H.R. 5376, the Build Back Better Act [cbo.gov]
- Getting Personal With Iman [NY Times]
- What Did Mugs Ever Do to Martha Stewart? [The Cut]
- NYC Takes Major Step Toward Making Outdoor Dining Permanent [Gothamist]
- St. Jude Hoards Billions While Many of Its Families Drain Their Savings [Propublica]
- 'I'm a grown-ass woman': Fox NFL reporter Pam Oliver reflects on a remarkable run [The Athletic]
- Chevy Chase is 74, sober and ready to work. The problem? Nobody wants to work with him. [Washington Post]
- Is Venture Capital the Secret Sauce of the American Economy? (Ep. 482) [Freakonomics]