The Housing Market Won’t Back Down (Quickly)
While I’m not a Florida Gators fan, I’ve been listening to Tom Petty since his first album and loved the idea of this song being played at their games as a call out to their native son from Gainsville.
But I digress…
Greenwich Connecticut Continues to See Rising Prices And Limited Inventory
When I first began covering Greenwich nearly a decade ago, the market was overloaded with high-end inventory, and old-guard real estate brokerage firms were afraid to challenge the wildly overpriced expectations of sellers. Thus, few high-end properties were sold. During the pandemic era boom, all the excess listing inventory has been obliterated, and the outlook has been markedly better.
GREENWICH SALES KEY TRENDS
Elliman Report: Greenwich Sales Q3-2022
“Price trends pressed higher while listing inventory and sales continued to slip.”
- Single family sales fell from the year-ago record but remained above pre-pandemic levels
- Single family median sales price hasn’t seen a year-over-year decline in fourteen quarters
- Condo sales fell year over year for the fourth quarter but were well above pre-pandemic levels
- Luxury listing inventory fell annually to the second lowest on record, less than half of pre-pandemic levels
- Luxury median sales price increased year over year for the second time in three quarters
FAIRFIELD COUNTY SALES KEY TRENDS
Elliman Report: Fairfield County Sales Q3-2022
“Listing inventory continued to fall, currently only one-third of pre-pandemic totals.”
- All price trend indicators rose annually and were significantly above pre-pandemic levels
- Listing inventory fell year over year and to one-third of pre-pandemic levels
- Sales declined year over year for the fifth consecutive quarter but remained higher than pre-pandemic levels
- Luxury average and median sales prices rose to their respective second-highest on record and were sharply above pre-pandemic levels
- Luxury listing inventory rose year over year for the first time in fourteen quarters
- Luxury days on market fell to their shortest average on record
Ritholtz: Collapse in New Home Buyer Traffic
The caveat these days is that a wicked combination of events — falling new home construction post-GFC, the pandemic purchase spree, and the low available inventory have made it more difficult to read into the usual home data.
Without Enough Listing Inventory, Florida Housing Markets Are Far Different Than Prior Eras
We just released our research on nearly two dozen Florida markets for Douglas Elliman. All the reports will be available early next week here and here, but many reports are already online. Here’s a great recap of the research in The Real Deal: “It’s not dead, it’s just different.” South Florida resi slowdown persists.
Across the region, price trends continued to rise, with many markets seeing new highs. Listing inventory expanded over the summer but remained well below pre-pandemic levels. Sales volume slowed compared to the frenzied levels of 2021 before mortgage rates spiked but remained above pre-pandemic levels. The market is coming off of one of the largest housing booms of the modern era, pivoting to more typical activity levels. However, the lack of listing inventory persists as a market condition even with the higher cost of financing. Bidding wars remained a part of the market landscape in the third quarter but with a lower share of sales.
- Price trends continued to rise, reaching new highs and near records, often significantly higher than pre-pandemic levels
- The number of sales declined from year-ago levels, ending an upward streak for much of the pandemic era
- Listing inventory continued to fall as sellers remained wedded to the record low mortgage rates they obtained during previous purchases or refinances during the past several years
- The pace has cooled from last year’s torrid state yet remains faster than pre-pandemic levels
Here is a random sampling of charts from many of the markets we cover – I apologize for the large number to scroll through.
Mortgage Fraud Victims: Sanctioned Wealthy Mansion Owners?
This was an excellent WSJ article on an investigation of a scheme to borrow money using a fake passport, targeting individuals subject to federal sanctions. Florida Couple Turned the Empty Miami Mansions of Venezuela’s Elite Into Personal Piggy Banks.
Apparently, hard money lenders don’t ask many questions.
The sanctions also prevented Mr. Lopez Bello from paying the electricity bill, his attorney said. As a result, the home’s security system was down.
Mr. Gonzalez joined the scheme, doing landscaping work on the property to make sure it looked good for appraisers, Messrs. Gonzalez and Castañeda told investigators.
Downtown Boston Sees Slowdown In Sales Yet Large Decline In Supply
The Boston condo and 1-3 family market in Downtown Boston markets are seeing fewer sales, but more sales than predamemic conditions as overall listing inventory falls.
DOWNTOWN BOSTON SALES KEY TRENDS
Elliman Report: Downtown Boston Sales Q3-2022
“Median sales price continued to press higher annually as the number of sales slipped.”
- Median sales price growth increased year over year for the sixth consecutive quarter
- Listing inventory fell annually for the sixth consecutive quarter
- The number of sales declined year over year for the third consecutive quarter
“The number of sales declined year over year for the first time in eighteen months as median sales price continued to rise.”
- Listing inventory continued to fall annually for the sixth straight quarter
- Median sales price hasn’t seen a year over year decline since the first quarter of 2021
- The number of sales fell annually for the first time in six quarters
My favorite charts of the week of our own making
My favorite charts of the week made by others
(For earlier appraisal industry commentary, visit my old clunky REIC site.)
Flying First Class Allows TAF & AI Quality Time To Aleve The Stress Of Actually Worrying About Appraisers
In the past I have discussed how AI FOJ leadership flies first class, especially abroad, often accompanied by their service spouse and service best friends, all on the dime of the hard-working membership.
I now hear that TAF channels its inner AI, enabling FOD employees to do the same thing on the “in the trenches” appraiser’s dime. As a reminder, TAF is the author of the bat-shit crazy letter, the chickenshit letter and is subject of an active investigation by HUD on whether USPAP promotes a lack of diversity in the appraisal profession (BLS: 98% of appraisers are white).
I’m not wholly opposed to a CEO who is doing a great job of running their organization flying first class but I’m not enthusiastic about it as a management style either. But when these leaders are being paid by organizations that have fundamental problems like a 30% membership collapse in a decade or one that is oblivious to its creating the least diversified industry in the U.S. and has utterly failed at its responsibility to maintain the public trust, then this mindset is disconnected and wrong. Then take it a step further and allow your sycophants to do the same is simply unconscionable, immoral, and unethical. In other words, it’s a grift.
Here are the strategic benefits of “in the trenches” appraisers paying for appraisal executive’s airfare from Dave & Jim’s perspective (with a slight sarcastic embellishment by moi).
- It helps maintain the two monarchs’ power as a perk to their minions for their loyalty.
- It incentivizes FODs and FOJs to work hard to appease the monarchs so that someday they can get warm towels at 30,000 feet for free.
- It helps maintain their branding as organizations that are wholly disconnected from the realities of appraisers and the public trust
- It’s all about the grift. Soaking their membership for whatever perks they can because, after all, what are the “in the trenches” appraisers able to do about it? (Nothing.) To paraphrase a former AI president at a board meeting, “I want to be able to fly first class abroad with my wife; I’ve earned it.”
ABC TV Documentary ‘Our America: Lowballed’
Because this issue was ignored by the appraisal industry, it is open season on appraisers.
Because of the lack of credibility or awareness of the diversity issue that the appraisal industry faces by the two primary appraisal industry organizations, The Appraisal Insititute and The Appraisal Foundation, there is no counter that can be presented to this continuing storyline. Its too late to have our industry review that second report in each of these situations as many appraisers have said.
After all, TAF has fostered an appraisal career process that has resulted in an industry that is 98% white (dead last of 400 tracked jobs) and never had a person of color on any of its boards in its more than three-decade history. Only after capitulating to external pressures such as these Housing Notes and other efforts required a change. That included adding one person of color to the AQB and, of course, having a middle-aged white guy lead their diversity initiative.
And AI CEO disbanded their diversity committee around seven years ago, relegating it to a panel in a political move to protect his power within the most white, male organization.
Now it’s too late. The documentary storyline was launched by the 2018 Brookings Institute report that made for good headlines and started the much-needed conversation, yet fundamentally misunderstood what appraisers actually do but fit in perfectly with the stunning lack of diversity within the industry.
Reporter Julian Glover in San Francisco has been all over this issue since the beginning, leveraging local stories into broader coverage. Here’s the trailer for the series that begins on December 2nd.
I get a steady stream of PR pitches after twelve years of blogging. Here’s the PR pitch on this documentary to me:
Good Morning Jonathan,
As many of us may know, Black and Latino families have had their homes appraised for up to $500,000 less than expected, and racial bias may play a significant factor.
According to an ABC Owned Television Stations data analysis of more than 50 million home loans, refinance applications in predominantly Black neighborhoods are nearly five times more likely to be under-appraised than in white communities. The analysis also found that home-purchase loans in Black neighborhoods are more than twice as likely to be appraised under value.
To raise awareness on this systemic issue affecting families across America and to equip viewers with information on what they can do if they find themselves lowballed in an appraisal, ABC Owned Television Stations has produced “Our America: Lowballed,” with the trailer now available.
The documentary special will debut on ABC Owned Television Stations’ 24/7 streaming platforms, 32 connected TV apps across streaming platforms Amazon Fire TV, Apple TV, Android TV, Roku and Hulu beginning Dec. 2, with a linear release across eight ABC stations the weekend of Dec. 5
The press release with the full details is detailed below.
With that said, are you interested in:
Sharing the trailer to “Our America: Lowballed” with your audience?
Interviewing one of the spokespeople
Please let me know your thoughts. I’m looking forward to hearing from you.
Appraisal Buzzcast: The Impact of Hurricane Ian with Fort Myers Appraiser Matt Simmons
After Hurricane Ian hit, I reached out to Matt. I was glad to hear he was ok and shared some on-the-ground insights as we connect over the next few weeks. When I saw that he was interviewed on Appraisal Buzzcast I thought I’d share.
Extra video context of Fort Myers Florida…
OFT (One Final Thought)
The fiftieth anniversary of King Krimson’s debut album was three years ago. Now there is a documentary.
This week!— Robert Fripp (@rfripp_official) October 17, 2022
WORLDWIDE CINEMAS – WEDNESDAY – 19 OCTOBER – ONE NIGHT ONLY
UK Screenings: https://t.co/5iE8TVQmRy
Worldwide screenings: https://t.co/OZ9mcrezsQ
WORLDWIDE STREAMED/DIGITAL EVENT – SATURDAY 22 OCTOBER
Book here : https://t.co/poktqq7EbT pic.twitter.com/QGylgFxHkN
I could never get that riff out of my head.
"It is the dream band viewed from outside. It's the band you could do anything you wanted to in it. It's the band that could do anything!" – Bill Bruford— KING CRIMSON (@DGMHQ) October 19, 2022
Get tickets for the new KC doc In The Court of The Crimson King at https://t.co/n97R0cP35j#ITCOTCK pic.twitter.com/CeExKLtUqU
Brilliant Idea #1
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 because:
- They’ll not be able to back down;
- You’ll be more like a 20th Century Schizoid Man/Woman;
- And I’ll write some market reports.
Brilliant Idea #2
You’re obviously full of insights and ideas as a reader of Housing Notes. I appreciate every email I receive, and it helps me craft the following week’s Housing Note.
See you next week.
Reads, Listens and Visuals I Enjoyed
- Home Buyers Flock to Florida Cities Devastated by Hurricane Ian [Wall Street Journal]
- No Longer Tied To Offices, Workers Are Still Bound by the Clock [Bloomberg]
- Apartment Builders Didn’t Get the Housing Slump Memo [Bloomberg]
- Real estate insiders take swipe at Back-to-Work Barometer hailed by NYC mayor [NY Post]
- ‘Emotionally Paralyzed’ New York Home Buyers Are Backing Out of Contracts [Curbed]
- The Rent Is Still Too Damn High: Catching Up With Jimmy McMillan [City Limits]
- Collapse in Prospective Home Buyer Traffic – The Big Picture [Ritholtz]
- California to mandate insurance discounts for wildfire mitigation efforts [LA Times]
- Manhattan Townhouse Market’s Hot Streak Continues With $57 Million Deal [Wall Street Journal]
- Housing market becomes more balanced as falling home sales led to higher inventory [Seeking Alpha]
- Real-Estate Companies Grapple With High Interest Rate Hedging Costs [Wall Street Journal]
- A Housing Crisis Has More Politicians Saying Yes to Big Real Estate [NY Times]
- Monthly Mortgage Payments Up Record Year-over-year [Calculated Risk]
- Construction begins on Miami’s first supertall tower. Who won the race to the sky? [Miami Herald]
- Compass is in a precarious position. It's worth a fraction of its IPO valuation, it's never turned a profit, and employees say the former centerpiece of the business — its vaunted tech tools for agents — is falling apart. [Business Insider]
- Rent Going Up? One Company’s Algorithm Could Be Why. [ProPublica]
My New Content, Research and Mentions
- After a lag, a developer brings some relatively rare luxury housing to the Lower East Side [Crain's New York]
- BUYER'S MARKET? Boca Raton, Delray Beach Home Sale Prices Drop [Boca News Now]
- South Florida Resi Sales Fall, Prices Rise in Third Quarter [The Real Deal]
- Buoyed by the Pandemic, New York Suburb Greenwich, Connecticut, Finally Sees Sales Recede [Mansion Global]
- Inside a 95-square-foot NYC home: ‘I feel like I’m paying a pretty fair price’ [NY Post]
- Zeckendorfs, Atlas File Plans For Shorter-Than-Expected Luxe West Side Tower [Bisnow]
- Long Island saw record-setting fish kills this summer [WSHU]
- Manocherian Family Sells Midtown Rental Tower for $50M [The Real Deal]
- Manhattan Condo Aims to Sell Out Before Listing a Single Unit [Bloomberg]
Recently Published Elliman Market Reports
- Elliman Report: Jupiter + Palm Beach Gardens Sales 3Q 2022 [Miller Samuel]
- Elliman Report: Fort Lauderdale Sales 3Q 2022 [Miller Samuel]
- Elliman Report: Delray Beach Sales 3Q 2022 [Miller Samuel]
- Elliman Report: Deerfield Beach Sales 3Q 2022 [Miller Samuel]
- Elliman Report: Boca Raton 3Q 2022 [Miller Samuel]
- Elliman Report: Greenwich Sales 3Q 2022 [Miller Samuel]
- Elliman Report: Fairfield County Sales 3Q 2022 [Miller Samuel]
- Elliman Report: Downtown Boston Sales 3Q 2022 [Miller Samuel]
- Elliman Report: Brooklyn Sales 3Q 2022 [Miller Samuel]
- Elliman Report: Northwest Queens Sales 3Q 2022 [Miller Samuel]
Appraisal Related Reads
- New York v. Trump Lawsuit Highlights Shortcomings of the Real Estate Appraisal Process [Propmodo]
- The 'Catch-22' That's Keeping Aging Malls Stuck In Limbo [Bisnow]
- The Impact of Hurricane Ian [Appraisal Buzz]
- The story of Zillow’s last house in Sacramento [Sacramento Appraisal Blog]
- Watch – Lowballed [Our America]
Extra Curricular Reads
- Why Signal won’t compromise on encryption, with president Meredith Whittaker [The Verge]
- Americans Reclaim 60 Million Commuting Hours in Remote-Work Perk [Bloomberg]
- The $30 Million Lottery Scam [The Atlantic]
- The Real-Life Vampire Autopsies of the Victorian Era [Atlas Obscura]
- Chartball is sports data visualized in a playful way [Flowing Data]