Another Housing Crash

[Meandering]

U.S. Bank to lay off 260 from Bedford mortgage office
Updated May 11; Posted May 10

BEDFORD, Ohio -- U.S. Bank said it will eliminate about 260 jobs starting in July because it's closing its Bedford mortgage and consumer banking office.

The layoffs were announced in a notice to the state of Ohio on Tuesday. The law requires 60 days' notice of major job cuts.

The decision is real estate-based, said U.S. Bank spokeswoman Molly Snyder. "After a strategic review of our real estate footprint, we have made the decision to close the U.S. Bank satellite office in Bedford, Ohio, when its lease expires this fall."

https://www.cleveland.com/business/index.ssf/2018/05/us_bank_to_lay_off_260_from_be.html



Yup, bank employees can sit on unemployment while appraisers wait for distressed inventory to push market prices higher.

Sounds like a plan.

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[George Hatch]

Pent-up demand for real estate,

it's constraint and release
does/will happen differently,
and usually, at different times,
in different market areas.

However,
with greater centralization of control,
The time differences between market area reactions begin to diminish.

Centralization picks winners and losers.

Even if they won't tell you that.

.

This kind of thing could not have happened without the gov't tolerating and encouraging the corrupt practice of extend and pretend. The moral hazard of this is going to wind up biting us all in the ***.

 

[Meandering]

This kind of thing could not have happened without the gov't tolerating and encouraging the corrupt practice of extend and pretend. The moral hazard of this is going to wind up biting us all in the ***.

Don't worry.

We've got desktop appraisals to cover the losses.

And think of all that money those $50 an hour desktop appraisers saved to survive this down turn.

.

 

[George Hatch]

Well, if the past cycles have been any indication, some appraisers probably won't survive the next downturn.

 

[Meandering]

Well, if the past cycles have been any indication, some appraisers probably won't survive the next downturn.

You are right.
But, maybe this time around,
we should get together to teach those appraisers how to be real estate investors,
so that they'll have rental properties generating income for them, and they won't be lost to the world of appraising.

After all,
who better to speak the lingo of value to appraisers,
than other appraisers?

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[Evincere]

Eight of the top 10 counties with the highest median home prices in Q1 2018 posted negative net migration in 2017: Kings County (Brooklyn), New York (25,484 net migration decrease); Santa Clara County (San Jose), California (5,559 net migration decrease); New York County (Manhattan), New York (3,762 net migration decrease); Orange County, California (3,750 net migration decrease); and San Mateo, Marin, Napa and Santa Cruz counties in Northern California.

https://www.attomdata.com/news/market-trends/home-sales-prices/home-affordability-report-q1-2018/

Re the above decreasing numbers. My sources tell me the up and coming NY Manhattanites in search of affordable housing are starting to migrate to the borough of the Bronx now known as SoBro.

https://www.google.com/amp/s/www.cn...target-of-nycs-relentless-gentrification.html

 

[Randolph Kinney]

Re the above decreasing numbers. My sources tell me the up and coming NY Manhattanites in search of affordable housing are starting to migrate to the borough of the Bronx now known as SoBro.

https://www.google.com/amp/s/www.cn...target-of-nycs-relentless-gentrification.html

The neighborhood offers easy access to the Metro area's major cultural and business hubs, Ivory said, as well as relatively cheap housing.

"In the Grand Concourse area, characterized by beautiful pre-war buildings with huge, original floor plans, we're seeing a baseline for studios around $1,500 to rent and $150,000 to buy," she said. There are also options for those looking for luxury.

Penthouses aren't exactly synonymous with living in the Bronx—yet Ivory said she has one available for $3500 per month that features "a wraparound terrace with unobstructed views of Yankee Stadium, Manhattan, and New Jersey," she said. "You're just not going to find that level of property at that price point anywhere else in New York City."

That is very cheap compared to San Diego coastal areas, which are typically twice that price to buy.

The locals don't like the "gentrification" but that happened in areas along the coast in California. Little seaside towns were crowded out by people moving in.

 

[Randolph Kinney]

U.S. mortgage rates at seven-year highs

The Commerce Department’s report on sales of newly-constructed homes, released Wednesday, suggested that market momentum was pulling back. Some analysts attribute that wobble in part to higher mortgage rates.

 

[Meandering]

Some analysts attribute that wobble in part to higher mortgage rates.

And what did they attribute last year's issues to, before mortgage rates went higher??

Until prices rise to a level where the bulk of possible inventory can sell, recoup costs and make some capital gains, the market is going to continue to "wobble" on distressed inventory.

.

 

[Randolph Kinney]

Homeownership tenure posts largest quarterly drop since Q4 2008

Among 40 metropolitan statistical areas with a population of at least 1 million, those with the biggest quarterly drop in average homeownership tenure were Cleveland, Ohio (down 6 percent); Seattle, Washington (down 6 percent); Salt Lake City, Utah (down 5 percent); Minneapolis-St. Paul, Minnesota (down 4 percent); and Sacramento, California (down 4 percent).

High-end share of home sales increases from year ago to highest level in a decade
The report also included an analysis of high-end home sales trends in the wake of tax reform legislation passed in December that caps the mortgage interest deduction for federal income taxes at interest paid on $750,000 and caps the state and local tax deduction (including property taxes) at $10,000.

Nationwide homes selling for more than $1 million accounted for 4.18 percent of all U.S. single family home and condo sales in Q1 2018, up from 4.02 percent of all sales in Q4 2017 and up from 3.38 percent of all sales in Q1 2017 to the highest level since Q4 2007.

Other high-level findings

• Sales to buyers using FHA loans (typically first-time homebuyers) accounted for 11.9 percent of all single family home and condo sales in Q1 2018, down from 12.6 percent in the previous quarter and down from 14.4 percent in Q1 2017 to the lowest level since Q1 2014 — a four-year low.
• Distressed home sales — including bank-owned (REO) sales, third-party foreclosure auction sales, and short sales — accounted for 14.7 percent of all single family home and condo sales in Q1 2018, up from 13.6 percent in Q4 2017 but still down from 16.9 percent in Q1 2017.
• All-cash purchases represented 30.0 percent of all single family home and condo sales in Q1 2018, up from 28.7 percent in Q4 2017 but down from 31.5 percent in Q1 2017.
• Sales to institutional investors (entities purchasing at least 10 properties in a calendar year) accounted for 1.7 percent of all single family home and condo sales in Q1 2018, down from 3.6 percent in Q4 2017 and down from 2.0 percent in Q1 2017 to the lowest level as far back as data is available, Q1 2000.

https://www.attomdata.com/news/market-trends/home-sales-prices/q1-2018-u-s-home-sales-report/

The data does not appear to represent a healthy real estate market. 30% of sales are all cash, however, distressed home sales accounted for 14.7% of all sales. With short inventories and rising home prices, why so many distressed sales?