Real estate trends are always in flux. Here’s what you need to know about the latest happenings.

The housing market has been gaining strength in the last few years — particularly during the COVID-19 pandemic. Home values soared, buyer demand jumped, and mortgage rates hit historic lows. And ultimately, it’s made housing one of the few bright spots during an otherwise difficult time.

But the housing market is always in flux, and real estate trends come and go. Throw in that this industry is highly localized, with different conditions in every city, state, and metro area, and you can’t bet on things staying stagnant for long.

Fortunately, understanding the fundamentals of the market can help you stay on top of all these changes. Check out some of those fundamentals below, and scroll down for the most up-to-date real estate trends of the month.

Real estate prices

House prices are influenced by a number of factors, including local buyer demand and the amount of housing supply that’s available for purchase. Generally speaking, high demand and low supply cause housing prices to rise.

Mortgage rates can also play a role since they impact demand. When rates are lower, there tends to be more interest in buying homes. When rates rise, demand might wane a bit.

At the national level, home prices have been rising for some time. As of the end of 2020, the median home price was just under $347,000. Home prices jumped 11% across 2020 alone.

Housing affordability

Affordability isn’t just a result of house prices. Incomes, inflation, and interest rates also play a role. So rising prices? They don’t always mean homes are getting less affordable. If rates are particularly low or incomes are increasing, homebuyers might actually be able to afford more house than they could have previously.

Fortunately, that’s exactly the scenario we’re seeing today. When factoring in rates, income trends, and inflation, consumer house-buying power was actually up 21% by the end of 2020.

Interest rates

Mortgage interest rates play a big role in the housing market, impacting demand, home prices, and affordability. They also fluctuate daily based on a whole slew of factors, including Federal Reserve policy, the bond market, investor interest in mortgage-backed securities, and, of course, inflation.

In early 2021, mortgage rates hovered around all-time lows, according to Freddie Mac. The average rate on a 30-year, fixed-rate mortgage was just 2.74% in January, up from 3.62% the year before and 4.76% a decade prior.

Housing inventory

Housing inventory — or the supply of homes that are currently available for purchase — is another important factor in the housing market, too. When inventory is low and demand is high, it creates a seller’s market. Home prices rise, bidding wars erupt, and sellers have the upper hand in negotiations.

If inventory is high, on the other hand, buyers tend to have the advantage. In a buyer’s market, there are more available listings than there are buyers to purchase them. This slows down price growth and makes the market less competitive overall.

As far as today’s inventory goes, supply has been very low in recent years, and the coronavirus pandemic only worsened things. With sellers leery about having strangers in their homes — not to mention loads of economic uncertainty — the number of for-sale listings plummeted in 2020, at one point reaching its lowest level ever recorded. Listings have since recovered slightly but still remain fairly low. It’s possible widespread vaccinations will help loosen supply constraints and get sellers back on the market, but, of course, only time will tell.

Delinquencies and foreclosures

Mortgage delinquencies and distressed properties like foreclosures and REOs are another part of the market to pay attention to, especially if you’re an investor. Both of these tend to rise in times of economic hardship. (Case in point: During the financial crisis over a decade ago, there were around 3.8 million foreclosures.)

Housing market cycles and crashes

Real estate, along with the overall economy, tends to be cyclical. There are booms and busts, and as we saw with the housing crash back in 2007-2008, some of these extremes can get pretty bad.

Fortunately, most experts don’t think we’re nearing another crisis just yet. Though the economy is in a recession, there are a few key differences in today’s housing market versus those of downturns past.

For one, property owners have record levels of equity. Between Q3 2019 and Q3 2020, homeowner equity jumped by $1 trillion, and according to recent data, a mere 3% of properties have negative equity. This equity protects borrowers in the event their homes lose value, giving them a sort of buffer if the market turns.

Lending standards are also stricter than they once were, so homeowners likely have fewer debts and better credit profiles; overall, they’re more financially equipped to handle the mortgages they’ve taken out. On top of all this, there are low interest rates to consider. The Federal Reserve has committed to keeping the federal funds rate around zero until at least 2023. This should keep mortgage rates low and housing demand high for the foreseeable future.

 

Now that we’ve got those housing market basics out of the way, let’s dive into some more recent trends we’ve been seeing on the ground. Here’s what’s happening in the real estate market in October 2021.

1. Rents are skyrocketing

If you’re a landlord, it’s good news all around. The eviction ban finally ended, and rents are at record highs. According to Realtor.com, they jumped by 11.5% between August 2020 and August 2021, marking the first double-digit increase on record. Rents are even more expensive than starter homes in many American cities.

The average rent for the month clocked in at $1,633, up $169 a month. Two-bedroom apartments saw the biggest jump, at 12.3% over the year. Those rents now hover just under $1,830 per month.

2. Buying activity is slowing down

It seems competition is finally starting to wane. It might be the start of school, the threat of rising mortgage rates, or maybe buyers are finally getting burned out on the market. Whatever it is, it’s seeming easier to buy a home these days.

Existing home sales are down 2% for August, the first decline in over a year, and overall sales fell 6%. What’s more? The bidding war rate is the lowest it’s been all year. Currently, just over half of all buyers face a bidding war.

3. Home prices continue on their tear

Don’t let that dwindling competition fool you. Just because some buyers are stepping back doesn’t mean homes aren’t selling. They definitely are — and often at a premium.

According to the most recent House Price Index from the Federal Housing Finance Agency, national home prices are up over 19% as of July compared to last year. Between June and July alone, they rose 1.4%.

Homes in the Mountain division of the Census — which includes Arizona, Colorado, Utah, Idaho, New Mexico, Montana, Nevada, and Wyoming — saw the biggest jump in prices. Those are up a shocking 25.6%.

4. Foreclosures are rising

The foreclosure moratorium is officially in the rearview, and lenders acted fast. According to ATTOM Data Solutions, August saw a 27% jump in foreclosure filings — and that’s just compared to July. Over the year, they rose 60%.

Foreclosure starts were highest in California, Texas, Florida, Illinois, and New York, while New York, Chicago, Los Angeles, Houston, and Dallas topped the list of metros. If you’re a house flipper on the hunt for distressed properties, these should be the first places you look.

5. Mortgages are getting easier to come by

The Mortgage Bankers Association shows the mortgage credit availability is up, with a 3.9% increase between July and August. This essentially indicates the lending standards are loosening, making it easier to get a mortgage loan.

Credit availability is up the most on jumbo loans, which typically come with some of the most stringent qualifying standards. Conventional loans also saw a notable jump.

If that weren’t enough to get investors excited, there’s one more bit of mortgage-related news that might help. A few weeks ago, the FHFA announced it was rolling back policies that limited Fannie Mae and Freddie Mac‘s purchases of investment property loans. This should result in lower rates and fees on those mortgages moving forward.

The bottom line

The housing market is always changing. Be sure to check back in November for the latest trends and happenings in real estate.

Origination: https://www.millionacres.com/real-estate-market/real-estate-trends/real-estate-trends-guide/

Over the next few weeks and months, the long-overheated U.S. housing market is expected to continue to cool off in the bracing chill of autumn.

After a wild year of unprecedented price increases, a worsening shortage of homes for sale, and cutthroat bidding wars where offers six figures over the ask price weren’t uncommon, conditions are finally normalizing. More homes are expected to go up for sale this season just as many would-be buyers are either priced out or so fed up after losing out on home after home that they’re dropping out of the running.

“The fever in the housing market has broken,” says Ali Wolf, chief economist of building consultancy Zonda. “There have been buyers that have just been beat down for the last six months—and after losing so many homes and going through the emotional roller coaster, they’ve decided to stop searching for now. There are more homes on the market than there were six months ago.”

During the COVID-19 pandemic, record-low mortgage interest rates, below 3%, helped many homebuyers to absorb prices that reached all-time highs in the spring and summer. But prices rose so high so quickly that even bargain mortgage rates couldn’t offset them enough to give buyers some needed financial relief.

With more folks sidelined, some of the steam has been let out of the market. Prices aren’t rising by as much as competition is down and homes are taking a little longer to sell, giving buyers some breathing room.

In September, the rate of year-over-year growth was halved, to 8.6%, down from its peak of 17.2% in April, according to Realtor.com® data. This means the median list price of a home grew half as fast as in the spring. Homes also took a bit longer to sell, at about 43 days. While that’s down 11 days from the same month last year and 22 days from 2019, it’s up 6 days from June.

“Things are settling down. There will still be some multiple offers, but it will be less tense,” says Lawrence Yun, chief economist of the National Association of Realtors®. He expects the days of homes receiving 20 to 30 offers are becoming a thing of the past. “And some homes are lingering on the market for a week or two without an offer.”

This fall, buyers may once again be able to include contingencies in their offers, such as requiring home inspections and appraisals, and still win out bidding wars. They may even—gasp—get homes at the list price.

All-cash offers could also dip if buyers don’t need to cash out their savings, stocks, and cryptocurrency stashes to stand out from the competition.

“It’s not like the market is soft,” says Yun. “It’s just moving away from that extreme frenzy.”

The changes in the housing market may be coinciding with the seasonal slowdown. Typically, competition is fierce in the summer as families battle over larger homes in the suburbs, hoping to secure residences and settle in before the kids start school. Then the market slows down with less competition for the smaller homes that traditionally go up for sale.

Yun expects annual price increases will slow to a more normal level, around 5%, versus the double-digit price hikes that reigned earlier in the year. But this may not be true for every home in every part of the country.

“If you want a reasonably priced home in a desirable area, be ready to still face stiff competition,” says Zonda’s Wolf.

Will home prices fall?

The question on the minds of sellers, buyers, homeowners, and just about everyone else is whether prices might actually fall. Sorry, buyers, that likely won’t happen anytime soon.

The nation is still suffering from a severe housing shortage resulting in more buyers than there are abodes for sale. This is a continuing hangover from the Great Recession’s aftermath, when builders largely held off on building while investors bought up single-family homes and turned them into rentals. Meanwhile, the millennial generation is larger than the previous one, meaning there are more prospective buyers than there were a decade or so ago.

There’s plenty of pent-up demand for homes.

“You’ve still got a lot of young people who have still not bought a home but who would like to,” says Realtor.com Chief Economist Danielle Hale. “Anytime the market starts to cool, you’ve got people on the sidelines waiting for their chance to get in. That keeps both home sales and home prices from declining too much.”

She expects more homes to hit the market in October and through the end of the year. But it won’t be enough to ameliorate the problem of demand.

The nation is still short about 5 million homes, Hale says. As builders can’t get them up fast enough, she expects it will take between five and six years before there are enough homes for sale to meet demand.

New construction is beginning to pick up after months of builders contending with shortages in lumber, labor, materials, and appliances. While there are still delays compared with before the pandemic, there was about a 5% uptick in construction in August compared with July, says Zonda’s Wolf.

“Inventory is still very, very tight,” says Wolf. But “we’re up from the bottom. We expect to see a little more inventory trickle onto the market through the end of this year and into next year.”

Rising mortgage rates will likely keep high prices under control

Rising mortgage interest rates are expected to keep price growth in check: After all, buyers can afford to fork over only so much for their monthly housing payments. So if rates rise, buyers won’t be able to afford more expensive properties.

This could result in lower price growth, or prices going flat or even dipping a little in certain markets.

“Once mortgage rates push up a little bit, it’s going to combine with higher home prices to price people out of the market,” says Mark Zandi, chief economist of Moody’s Analytics. “Some markets could see prices go down a little, like in the most juiced markets. … [But] it’s not a crash.”

Rates are expected to top 3% by the end of the year and reach 4% by the end of 2022, says Joel Kan, an economist at the Mortgage Bankers Association. They averaged 2.88% for a 30-year fixed-rate loan in the week ending Sept. 23, according to the most recent Freddie Mac data.

Historically speaking, even 4% is still low. Over the past 20 years, mortgage rates averaged about 5%, according to MBA. The difference between a 3% and a 4% rate on a $380,000 home (the median list price nationally) was about $169 a month on a 30-year fixed-rate loan. That adds up to nearly $61,000 over the life of the loan.

“We’re expecting rates to increase moderately over the next 12 months,” says Kan. “As the economy improves, as the job market improves, typically that pushes rates higher. [But] there is a little bit more uncertainty now, given that we’ve seen the pandemic linger longer than we expected.”

How will the fall market affect home sellers?

While experts predict the housing market will remain firmly in the seller’s court, the days of picking prices out of thin air are likely coming to an end. The same goes for not making any improvements to a property (let alone having it properly cleaned) before listing it.

“Some sellers got a little too greedy or had a misconception about the market conditions,” says NAR’s Yun.

Zonda’s Wolf recommends sellers look at comps of other homes in their neighborhoods that have recently sold to get a realistic idea of what they can charge for their properties. They should also get their homes in tiptop shape. And while they may not get 20 offers like their neighbors may have received a few months ago, well-priced, move-in ready homes are in high demand.

“If you’re a seller today, you’ll likely still get top dollar, but you’re still going to have to put in the work,” adds Wolf. “Dust for cobwebs, stage the home, put on a fresh coat of paint.”

Origination: https://www.realtor.com/news/trends/is-housing-market-frenzy-going-to-cool-off-this-fall/ 

This week will witness the 90th anniversary of the unveiling of New York City’s famed Waldorf Astoria Hotel on October 1, 1931. Following an unprecedented restoration, the structure for the first time is offering the opportunity to own one of 375 residences within The Towers of the Waldorf Astoria, starting from $1.8 million.

Buyers can savor the cache of living in a structure graced by guests from Frank Sinatra and Cole Porter to every president from Hoover to Obama. In addition, they’ll enjoy 50,000 square feet of private residential amenities focused on health and wellness, entertaining and business. Residences range from urbane studios to sumptuous four-bedroom homes and deluxe penthouses, many offering outdoor spaces.

Notes Andrew Miller, CEO of Dajia US, the owner-developer of Waldorf Astoria New York, “We have assembled a world-class team to return the Waldorf to glory as one of the world’s most beloved hotels and New York’s most prestigious residential address.”

 

With history on the minds of Manhattanites, this could be the ideal moment to explore some other rare present-day residential structures in the heart of New York that are — or include — buildings with even longer histories. They are The Woolworth Tower Residences, The Belnord and 111 West 57th Street. These properties are dream addresses for anyone who not only appreciates the borough’s long and storied history, but seeks to inhabit a piece of that time-honored legacy.

The Woolworth Tower Residences

Once the tallest building in the world, the Woolworth Building was designed in 1913 by Cass Gilbert as a commission from retail industry tycoon F.W. Woolworth. Today, the recently-completed Alchemy Properties-designed Woolworth Tower Residences fills floors 29 through 58 with 32 loft-like condos. A $22 million restoration of the tower’s arresting terra cotta façade was among ways Alchemy saluted the Woolworth legacy by resurrecting original details of the building. 

Another was the incorporation of a coffered ceiling reclaimed, restored and relocated from the private office of Frank W. Woolworth himself. Residences offer design details from Thierry Despont, who contributed to the restoration of the Statue of Liberty. Amenities include the Gilbert Lounge and entertaining area, wine cellar and tasting room, fitness center and fifty-foot lap pool.

Topping the tower at floors 50 through 58, 727 feet above Manhattan, is The Pinnacle, the residential conversion of the building’s famous crown. In addition to 9,680 square feet of interior residential space, The Pinnacle hosts a 408-foot observatory terrace. 

The Woolworth Building has been an important part of the skyline since its construction, says Alchemy Properties’ Kenneth Horn. 

“There was this great responsibility that we took on as a firm when we bought the upper portion to ensure that it lived up to its potential in this next iteration where people can call the building home for the first time,” he adds. “Now that construction is complete, residents are living in the building, and it is over 80% sold, we can say that we’ve achieved our goal of a perfect blend of old and new by emphasizing the historic elements of the building that are fully unique to Woolworth, while at the same time creating a contemporary design with modern-day conveniences.”

The Belnord

Among Manhattan’s turn-of-the-century residential buildings, few offer the grandeur of The Belnord, at 225 W. 86th Street. Filling a complete block, the 1908 jewel was designed by acclaimed architectural firm Hiss & Weekes. Those passing through the building’s arched 86th Street gated entrance into the massive 22,000-square-foot private courtyard might be forgiven for assuming a time tunnel had whisked them back to early 20thCentury New York City. 

Once, horses and buggies slowly moved through the gated entryway. Thanks to the renovation of the 113-year-old property, that entry has been widened to permit modern vehicles to park temporarily within the courtyard, placing residents nearer their homes. This is an example of how The Belnord is being renovated to combine its traditional grandeur with contemporary conveniences.

Renovation rather than rebuilding is necessary, because many of the building’s original features would be cost-prohibitive to build in contemporary New York City. The interiors by Robert A.M. Stern Architects deliver a number of very substantially-sized residences. The most notable is likely Residence 1012, priced at nearly $11.45 million, which features both a formal entry foyer as well as an entry art gallery.  

111 West 57th Street

This residential tower incorporates the venerable Steinway Hall, which opened on 57th Street in 1925. 

Steinway Hall was the creation of architectural firm Warren & Welmore, the architects who graced Manhattan with landmarks Grand Central Station, the New York Biltmore Hotel and the Commodore Hotel, now Grand Hyatt New York. SHoP Architects and Studio Sofield have reimagined the historic building, creating a selection of large, light-filled pre-war residences that pay tribute to Midtown’s gilded heritage. The reborn Steinway Hall is incorporated within 111 West 57thStreet, which tops out at 1,428 feet as the second tallest residential skyscraper on the face of the planet.

Says Bill Sofield: “The complex shapes, patterns and materiality of Studio Sofield’s designs reflect the distinctive profile of the tower, while collaborative works by local artists preserve and expand the historical importance of Steinway Hall.”

Origination: https://www.forbes.com/sites/jeffsteele/2021/09/29/new-yorkers-gain-opportunity-to-reside-within-pieces-of-history/?ss=real-estate&sh=5723442f371a 

 

We know that this is something we have been talking about a lot here in our blog. On the other hand, we want you as a buyer to have the best experience when buying your dream home. Since we have beautiful houses on the market now in Cinnaminson, NJ, we understand the needs and worries the buyers have. Keep reading to learn more about 5 topics to add to your list when you’re buying a home.   

1. Keep a six-month savings strategy 

When you plan for a six-month savings, you will feel way more comfortable and without anxiety when you purchase your home. Having an extra budget for if something unexpected happens, like sickness, or you lose your job, or even the pandemic that affected many people around the world, will make you not afraid to take this huge step in life. Therefore, the best solution is to plan and be very organized financially.    

2. Get pre-approved and stick with a fixed-rate mortgage 

The advantages of getting pre-approved are that you will already know what you can afford and how much your down payment can be. There are a variety of mortgages, and in this phase, it is crucial to see what fits best for you. In consequence, you are not tempted to buy what you cannot afford. 

3. Compare to get the best mortgage 

Most homebuyers don’t shop around to find the best mortgages. However, here it’s important to evaluate the one that best meets your needs, not just looks good for you. 

4. Don’t spend more than one-third of your taxable income

It is better to regret spending less money on the house than spend too much and not having anything to work with after. So, be as conservative as you can here, but we know it’s not always possible. 

5. You can walk away 

This is a tough decision when you finally find the home you want but the price is not something you can afford. Our tip is to always try to negotiate, and if your budget allows for it, offer more. On the contrary, you know what you can afford, so don’t be afraid to walk away if you can not get the offer that meets your budget. 

For sure, you will find the perfect house some day, so take your time. You will have your happily ever after! 

 

Cape Advisors and Pioneer Group has released a new rendering (top) and construction update for Astoria West, a 534-unit rental development rising at 30-77 Vernon Boulevard.

Already topped out, construction of Astoria West continues to progress at a rapid clip with leasing slated to commence in early 2022.

“There are very few remaining opportunities to develop along the water in New York City, which is one of several reasons we’re so excited about Astoria West and why we feel this project presented the perfect moment to enter the Queens market,” said Craig Wood, Founder of Cape Advisors. 

“The scale of the site has enabled us to introduce an entirely new product to the neighborhood with a thoughtful and robust amenity offering unlike anything else in the area. This property, when paired with the unbeatable location, will transform the living experience in Astoria.”

Fogarty Finger is the architect for the development, which features studios to three-bedroom apartments with views of the Manhattan skyline over the East River and the Hell Gate Bridge as well as a landscaped courtyard.

The amenity package spans over 40,000 s/f and includes a rooftop with resident pool club, lounge area, and a waterfront deck with BBQs, landscaped private inner courtyard and gardens as well as an on-site parking garage.

“We couldn’t be more excited about the progression of Astoria West and this latest milestone,” added George Scharenatz of the Pioneer Group. “All of the project collaborators continue to devote an incredible level of effort and attention to detail, and we look forward to seeing the project continue to come to life.”

Corcoran New Development is the exclusive marketing and leasing agent for Astoria West.

origination: https://rew-online.com/cape-pioneer-release-new-renderings-of-astoria-west/

In the global real estate industry, the largest and oldest asset class in the world, investment decisions have always been and will always be driven by people with information. Today, investors and service providers have access and need to effectively utilize an ever-increasing amount of data to create and capture value in a complex and competitive marketplace.

Secure access to this information — particularly key, proprietary data — is the critical pathway to operate at scale with speed and precision. Yet with increasing and expanding use of data assets, there are corresponding data liabilities. This is the new balance sheet as the real estate business is digitized.

Firms are responding with dedicated leadership in data security empowered with budgets, new processes, controls and oversight. Cybersecurity and data protection have quickly become the foundation of building and protecting enterprise value in the commercial real estate industry. To be clear, expertly managing information security risks is now expected of institutional investors and fiduciaries. The stakes are high and require new and evolving skills that every boardroom now has its full attention on.

From global syndicates of organized crime with malicious interests to unknowing oversights and mistakes by busy or distracted co-workers, there is a wide range of exposure to protect against, all while the related systems and use cases are fluid. The following framework with five core elements are essential to have thoughtful coverage across platforms and tools that your firm deploys:

1. Visibility and controlled access: Your internal processes should allow users to easily access and manage data and share policies that effectively govern your data, all while minimizing the risk of data loss through full visibility and central management of content, security, policy and provisioning. Your accounts should be authenticated with single sign-on. In addition, customer administrators should have the ability to enforce the use of strong passwords by their user accounts and have granular access controls on the accounts with the ability to revoke access at any time. All search engines and web crawlers should be blocked from customer data.
2. Comprehensive activity tracking and audit log: Your systems should include the ability to record and maintain every action performed in a detailed and structured activity log, while archiving a complete history so that you have complete visibility into their activity for total transparency.
3. Secure data and digital content services: All content on your systems should be delivered and accessible exclusively with strong encryption. Data should be transported over HTTPS using transport layer security (TLS) 1.3 in transit and stored with AES-256 encryption at rest. All systems should have multi-region redundancy and be under constant monitoring and threat detection.
4. Third-party verification and compliance: You should require and ensure the systems you utilize have and maintain rigorous third-party certifications with annual audits, including: SOC 2 Type 2 certification under SSAE 16, CyberGRX Tier 1 Assessment protocols, and penetration and vulnerability tests.
5. Availability and resilience: Your systems should deliver a secure, resilient and highly available service at scale for the world’s largest and most sophisticated investment management firms. Your systems should also utilize multiple data centers with reliable power sources and backup systems to deliver redundancy and reliable availability along with robust disaster recovery and business continuity plans that are made available to review upon your request and tested annually.

Accessing and processing increasing amounts of data are critical for creating new opportunities and efficiencies in the commercial real estate business. In the modern age, data protection is as important as physical security, requiring proper due diligence for proptech systems when evaluating and utilizing them. Partners, investors and clients will migrate to firms whose data and systems are most trustworthy. Investing robustly in cybersecurity not only protects your data but also gives confidence to your partners and clients that their data is safe.

There’s an old saying that if you encounter a bear in the woods, you just need to be faster than the person who you’re with. Today, the digital bears clone themselves in real time, and the firm next to you is on an Olympic training regimen for data security. Don’t lose a step and get eaten alive.

Origination: https://www.forbes.com/sites/forbesrealestatecouncil/2021/09/15/commercial-real-estates-new-foundation-cybersecurity-and-data-protection/?ss=real-estate&sh=64c928f8114a 

The median cost of owning or renting a home is unaffordable to minimum wage workers in all 50 of the country’s states, finds a new analysis from LendingTree. Rising home prices and rent costs are putting housing costs out of reach to more low-income earners.

The study finds that the affordable housing payment for minimum wage workers across the country is $1,074 less than the median monthly housing costs paid by homeowners. Renting was also found to be unaffordable. The difference between an affordable monthly housing payment and the median gross rent averages at $533.

LendingTree researchers studied whether owning or renting a home is affordable to a person working a full-time minimum job. They factored in 30% of a monthly gross income on housing to weigh affordability. They calculated how much a person could afford in monthly housing costs if working 40 hours a week for 52 weeks a year at their state’s minimum wage.

The states where owning is most affordable for workers earning minimum wage are Arkansas, West Virginia, and New Mexico. Check out the chart below for a full breakdown.

Origination: https://magazine.realtor/daily-news/2021/09/15/study-minimum-wage-workers-struggle-to-afford-ownership-rent 

Plans include a Japanese restaurant led by Michelin Star chef Shinichi Inoue

A zero-carbon-emitting luxury hotel and condo building that is partnering with a Michelin Star chef and a former Zaha Hadid senior architect sounds like a new development in Chelsea or Tribeca.

But Richard Xia’s Fleet Financial Group is seeking to bring the concept to Corona, Queens, just two miles from LaGuardia Airport.

The group plans to break ground on the 25-story project, known as Eastern Emerald, at the end of the month. Totaling 350,000 square feet, it will have 256 hotel units and 196 condominium residences. The project will also include a conference and performing arts center, along with a bar and restaurant led by chef Shinichi Inoue, formerly of Michelin-starred restaurants Sushi Azabu and Sushi Inoue.

To design the facade, Fleet Financial tapped SASI Studio, whose co-founder, Mattia Santi, was formerly a senior architect at Zaha Hadid. The design appears to mimic some of the style of the late Hadid’s use of curves.

Xia said the project already has funding in place using existing money from private investors as well as money from the federal cash-for-visas EB-5 program.

He said the project could also qualify for C-PACE financing, which allows developers and landlords to obtain cheap loans if they make certain energy improvements. The site was home to a car repair facility and gas station that Fleet Financial remediated. It received Track-1 remedial certification, which allows for unrestricted future use.

The luxury building is expected to be completed in about three to four years, according to Xia.

The Eastern Emerald would be an outlier for Corona, which isn’t known for luxury development. The average rent in the neighborhood is $2,110 per month compared with $3,217 in Long Island City, according to RentCafe, which tracks apartment rents. The area is close to Citi Field and Flushing Meadows Corona Park.

origination: https://therealdeal.com/2021/09/16/fleet-financial-to-bring-luxury-hotel-and-condo-project-to-corona-queens/

​​The forecast for the coming months is lower temperatures—and a cooler real estate market, if only by a few degrees.

The housing market is expected to shift to something closer to normal this fall, real estate experts say. They anticipate more homes will go up for sale, helping to slow down the unparalleled price increases and bidding wars of the past year.

But the market is likely to remain highly competitive, as there will still be many more buyers than homes to go around.

“We’re going to exhaust the pool of buyers who are still sitting on a lot of cash looking to buy their next home,” says Realtor.com® Senior Economist George Ratiu. “The market does not have a magical way of sustaining this pace [of price growth], because you’re going to run out of people who can afford it.”

However, that doesn’t mean that home prices, whose national median hit an all-time high of $385,000 in the week ending Aug. 14, will fall. In fact, prices increased 8.6% year over year that week. But that’s significantly less than the 17.2% annual rise in April. Going into the end of the year, prices may rise a more modest 5% to 6%, says Ratiu.

“The shift in the housing market will make shopping for a home a lot more tolerable than it has been, because consumers will actually have time to properly think through their decision and won’t be in as fierce of bidding wars,” says Ali Wolf, chief economist of building consultancy Zonda. “Going into fall, buyers may not need to pull out all the stops to win a house, like removing the inspection contingency or waiving the appraisal contingency.”

More homes are expected to go up for sale in the second half of the year. The influx won’t be nearly enough to put a dent in the dire housing shortage that’s the main reason for the record prices, but it may help curb the wild price growth.

“It’s still going to be a very strong housing market. Demand is still going to be well in excess of supply,” says Greg McBride, chief financial analyst at Bankrate.com. “It just won’t be as frenetic as what had been experienced earlier in the year.”

In June, there were 2.6 months of housing inventory for sale, according to the National Association of Realtors®. That’s an improvement from 1.9 months in January. However, a balanced real estate market has between 5.5 months and six months of homes for sale.

“We’re seeing the gap narrowing between demand and supply,” says NAR’s director of housing and commercial research, Gay Cororaton. But it isn’t going to even out anytime soon. “There’s still a huge, huge gap.”

The fall homebuying season is likely to be busier than usual

One thing that won’t return to usual is the pace of sales. Usually, the market begins slowing down and prices even dip in the fall; families typically prefer to get settled before the school year begins. But this year, the COVID-19 pandemic threw off the normal timing, and activity is expected to stay brisk after summer’s end.

“I expect an unusually busy fall season,” says Ratiu. After all, more homeowners are vaccinated and feel comfortable holding open houses, although the delta variant of the coronavirus could change this, or they just can’t delay their move. “Sellers are putting homes on the market. Normally this activity happens early in the spring.”

Demand is likely to stay strong as well—even though many buyers are frustrated or simply priced out. More millennials are hitting their prime homebuying years, and builders have been unable to ramp up construction to keep up with the growing population. With rental prices also hitting new heights, many people are seeing that it’s cheaper to buy than to continue to lease a home.

Plus, mortgage interest rates are still hovering around record lows. The fear of missing out on what could be a once-in-a-lifetime deal will likely entice additional buyers. (Rates averaged 2.87% for 30-year fixed-rate mortgages in the week ending Aug. 12, according to Freddie Mac data.)

And not every home will be affected by a slowdown.

“Don’t expect deals in the fall if you are house hunting in the most desirable part of a market or competing for a particularly nice house,” says Zonda’s Wolf. “Homes that stand out for one reason or another are still flying off the shelf.”

But overall, most buyers may not be as willing to pay top dollar and waive inspections and contingencies for less-than-spectacular homes that would have sold for $100,000 less just a year ago. There aren’t many regular people (as opposed to investors) who can pay all cash for a home. And there likely aren’t as many remote workers fleeing expensive cities and heading for cheaper parts of the country at this point in the pandemic as there were in the beginning.

“We are definitely shifting from an extreme excess of demand to a more moderate excess of demand,” says Ken Rosen, chair of the Fisher Center for Real Estate and Urban Economics at the University of California, Berkeley. But “it’s still going to be a seller’s market.”

In addition, many first-time buyers can’t afford to pay over the list price of a home if it doesn’t appraise for that much, says mortgage broker Rocke Andrews, of Lending Arizona in Tucson. They don’t have the extra cash to make up the difference.

The emergence of the delta variant is also spooking some buyers who worry about the stability of their jobs.

This could help to explain why the number of purchase mortgages (which don’t include refinances) dropped 18.7% year over year in the week ending Aug. 13, according to the most recent Mortgage Bankers Association data.

The market “will be nothing like the panic we saw” going into the fall, says Rosen. “It already is more orderly in many, many markets.”

Foreclosures likely won’t play a big part in the cooling market

Many folks have been anticipating a wave of foreclosures to sweep the country as moratoriums to protect struggling homeowners expire. However, it’s not expected to be nearly as severe as what happened during the Great Recession, or lead to an influx of homes going on the market.

Homeowners who haven’t made mortgage payments during the pandemic make up just a fraction of the housing stock—just 3.26% of mortgages were in forbearance as of Aug. 8, according to the most recent data from the Mortgage Bankers Association. Many of these folks will resume payments or work something out with their lenders. But at least some of these 1.6 million homes will hit the market.

Those homeowners who can’t resume their monthly payments and have enough equity in their properties can avoid foreclosure by putting their homes on the market. With prices at these levels, they may even walk away with a profit, and it won’t damage their credit.

“The middle-class and the upper-income groups won’t even notice the wave of foreclosures because it won’t be in their neighborhoods,” says Norm Miller, a real estate economics professor at the University of San Diego.

Lower-income homeowners who lost their jobs during the pandemic and don’t have much equity will likely be the ones who go into foreclosure. Their homes are expected to be in the lower-third price tier.

The number of foreclosures and how quickly they go up for sale are expected to vary from state to state. Some states have protections in place for homeowners that can delay proceedings significantly.

Some first-time buyers will scoop up these properties as the previous owners are forced back into the rental market. But the bulk are expected to go to investors, says Miller.

Investors are expected to keep home prices strong. During the pandemic, more institutional investors, such as pension funds and financial firms, have bought up single-family homes to turn them into rentals. Many can buy in bulk and pay in cash. That’s likely to continue.

Origination: https://www.realtor.com/news/trends/housing-market-continues-cooling-fall-season/