New NC development has micro-units. Could it help solve the housing shortage? (Gallery)

Nearly all apartments in the building are micro-studio units with an average size of around 500 square feet. “It’s a housing type that is desperately needed in the Triangle," the developer said......»»

Category: topSource: bizjournalsDec 5th, 2021

The affordable housing crisis has gotten worse — here"s why just building more homes isn"t the solution

In much of the country, there isn't a shortage of housing. The problem is that millions of people lack the income to afford what's on the market. The pandemic has made the affordable housing crisis a lot worse, in part by increasing the rate of evictions.Cory Clark/NurPhoto via Getty Images The housing affordability problem is pervasive in the US, and COVID-19 made it much worse. The problem isn't a lack of housing; even basic housing units are often unaffordable for those with low incomes. The solution: Cover the difference between what renters can afford and the actual cost of the housing. Even before 2020, the US faced an acute housing affordability crisis. The COVID-19 pandemic made it a whole lot worse after millions of people who lost their jobs fell behind on rent. While eviction bans forestalled mass homelessness — and emergency rental assistance has helped some — most moratoriums have now been lifted, putting a lot of people at risk of losing their homes.One solution pushed by the White House, state and local lawmakers, and many others is to increase the supply of affordable housing, such as by reforming zoning and other land-use regulations.As experts on housing policy, we agree that increasing the supply of homes is necessary in areas with rapidly rising housing costs. But this won't, by itself, make a significant dent in the country's affordability problems — especially for those with the most severe needs.In part that's because in much of the country, there is actually no shortage of rental housing. The problem is that millions of people lack the income to afford what's on the market.Where the crisis hits hardestRenters with the most severe affordability problems have extremely low incomes.Nationally, about 45% of all renter households spend more than 30% of their pretax income on rent — the widely recognized threshold of affordability. About half of these renters, 9.7 million in total, spend more than 50% of their income on housing, greatly impairing their ability to meet other basic needs and putting them at risk of becoming homeless.Nearly two-thirds of renters paying at least half of their income on housing earn less than $20,000, which is below the poverty line for a family of three. Renters with somewhat higher incomes also struggle with housing affordability, but the problem is most pervasive and most severe among very-low income households.For a household earning $20,000, $500 per month is the highest affordable rent, assuming the affordability standard of spending no more than 30% of income on housing. In contrast, the median rent in the US in 2019 was $1,097, a level that's affordable to households earning no less than $43,880.And homes that rent for $500 or less are exceedingly scarce. Fewer than 10% of all occupied and vacant housing units rent for that price, and 31% are occupied by households earning more than $20,000, pushing low-income renters into housing they cannot afford.A pervasive problemThe problem of housing affordability doesn't affect only a few high-cost cities. It's pervasive throughout the nation, in the priciest housing markets with the lowest vacancy rates like New York and San Francisco, and the least expensive markets with high vacancy rates, such as Cleveland and Memphis.For example, in Cleveland, with a median rent of $725, 27% of all renters spend more than half of their income on rent. In San Francisco, with a median rent of $1,959, 18% of renters spend at least half their income on rent. And it's even worse for the poorest residents. In both cities, more than half of all extremely low-income renters spend at least 50% of their income on rent.In fact, there is not a single state, metropolitan area or county in which a full-time minimum wage worker can afford the "fair market rent" for a two-bedroom home, as designated by the US Department of Housing and Urban Development.Even the smallest, most basic housing units are often unaffordable to people with very low incomes. For example, the minimum rent necessary to sustain a new a 225-square-foot efficiency apartment with a shared bathroom in New York City built on donated land is $1,170, affordable to households earning a minimum of $46,800. That's way out of reach for low-income households.At the heart of the nation's affordability crisis is the fact that the cost to build and operate housing simply exceeds what low-income renters can afford. Nationally, the average monthly operating cost for a rental unit in 2018 was $439, excluding mortgage and other debt-related expenses.In other words, even if landlords set rents at the bare minimum needed to cover costs — with no profit — housing would remain unaffordable to most very-low-income households — unless they also receive rental subsidies.The subsidy solutionCovering the difference between what these renters can afford and the actual cost of the housing, then, is the only solution for the nearly 9 million low-income households that pay at least half their income on rent.The US already has a program designed to help these people afford homes. With Housing Choice Vouchers, also known as Section 8, recipients pay 30% of their income on rent, and the program covers the balance. While some landlords have refused to accept tenants using vouchers, overall the program has made a meaningful difference in the lives of those receiving them.The $26 billion program currently serves about 2.5 million households, or only 1 in 4 of all eligible households. The current version of Democrats' social spending bill would gradually expand the program by about 300,000 over five years at a total cost of $24 billion.While this would be the single largest increase in the program's nearly 50-year history, it would still leave millions of low-income renters unable to afford a home. And that's not a problem more supply can solve.Alex Schwartz, professor of urban policy, The New School and Kirk McClure, professor of urban planning, University of KansasRead the original article on Business Insider.....»»

Category: topSource: businessinsiderNov 21st, 2021

Frenzies and Bidding Wars: Leaders Share Tactics to Win in the Post-Pandemic Market

After a year that relied heavily on Facetime rather than actual face time, real estate professionals are wondering what they should expect in 2022’s post-pandemic market. As market dynamics continue to shift, leading brokers shared how they’ve been planning for the future at RISMedia’s 26th Annual Power Broker Forum, held during the REALTORS® Conference & […] The post Frenzies and Bidding Wars: Leaders Share Tactics to Win in the Post-Pandemic Market appeared first on RISMedia. After a year that relied heavily on Facetime rather than actual face time, real estate professionals are wondering what they should expect in 2022’s post-pandemic market. As market dynamics continue to shift, leading brokers shared how they’ve been planning for the future at RISMedia’s 26th Annual Power Broker Forum, held during the REALTORS® Conference & Expo last week. The forum was moderated by John Featherston, founder, president, and CEO of RISMedia, Inc., and York Baur, CEO of MoxiWorks. From L to R:  John Featherston, Founder President & CEO, RISMedia; Cindy Ariosa, senior vice president, regional manager, Long & Foster Real Estate Inc.; Allan Dalton, senior vice president of Research and Development, Berkshire Hathaway HomeServices, HomeServices of America; Helen Hanna Casey, CEO, Howard Hanna Real Estate Services; and Anthony Lamacchia, broker/owner & CEO, Lamacchia Realty, Inc. The panel of experts included Cindy Ariosa, senior vice president, regional manager, Long & Foster Real Estate Inc.; Helen Hanna Casey, CEO, Howard Hanna Real Estate Services; Allan Dalton, senior vice president of Research and Development, Berkshire Hathaway HomeServices, HomeServices of America; and Anthony Lamacchia, broker/owner & CEO, Lamacchia Realty, Inc. “You’ll notice if you stop by our booth that we have a t-shirt that says ‘information is currency,’ and it is,” Featherston kicked off the forum. “That phrase reigns true in our industry now more than ever. It’s the information that our consumers are looking for that you have and that you present that keeps you in the forefront of their minds and keeps them coming back to you, the skilled real estate professionals that help them through their real estate goals and objectives.” From rethinking office space to implementing the right technology to addressing the new needs of today’s buyers and sellers, each panelist discussed their market expectations as 2022 nears. After a year of uncanny market conditions fueled by the coronavirus pandemic and government intervention, Dalton indicated that a market correction was imminent. However, he also noted that there was a more pressing question that needed to be addressed. From L to R: John Featherston, Cindy Ariosa and Allan Dalton “I never seem to hear much discussion about where our industry is going to take the market,” Dalton said, noting that instead of trying to predict the future of the market, agents should focus more on how they are guiding clients through shifting tides. In preparation for 2022, Hanna Casey suggested that agents and brokers start expanding their data tracking beyond typical “real estate numbers.” From L to R: Helen Hanna Casey and Anthony Lamacchia “We have a bigger problem in this country, and it’s not pricing,” Hanna Casey said, pointing out declining numbers of marriage, birth rates and household formation specifically as potential factors in market shifts slated for years to come. “I think we are going to be okay in the sense that we are still going to have a shortage, and as long as there is a shortage, there will be a demand, but if you look over a five-year period, I think we have to be doing something,” Hanna Casey added. This year, a slowdown in people willing to list contributed to the strained supply and buyer frenzy that drove prices sky-high during the summer. With a dearth of inventory slated to carry over into next year, Lamacchia forecasted “bidding wars and frenzies from coast to coast” to hit the market as early as this winter. Anthony Lamacchia “What I am hopeful of is that now that people are vaccinated, sellers and many would-be sellers are willing to list their homes faster than this past year,” Lamacchia said. However, he also warned agents not to view slowing sales as a detriment to the market. “Once we get to the winter and inventory is down, you’re going to see bidding wars go wildly again, but I’m hoping that we come out of it quicker by spring,” said Lamacchia. The increase in aging homeowners choosing to stay in place hasn’t done any favors regarding closing the supply-demand gap. However, Ariosa was optimistic for the coming year as new development of housing and apartments in Baltimore—and nationwide—could likely incentivize older people to list their houses. “I think they’re scared that they have nowhere to go, which is why they don’t want to get out of their house,” said Ariosa, suggesting that new units could be a boon for the market. The conversation then focused on what each panelist has done to take advantage of the shifting market in 2022. “Markets are great until they are not and as has been noted, none of us have a crystal ball – at least one that works – and so we’ve alluded to how you prepare for changes in the market, but I’m curious what have you already started to do over these last six months for further preparation to take advantage of things as they are but also with an eye towards how they might change beyond 2022,” said Baur. Both Ariosa and Hanna Casey have focused on sprucing up their customer and agent experience. Cindy Ariosa Ariosa noted that Long & Foster had expanded its client-facing services to improve its “one-stop-shop” offering along with its ancillary services. “We’re trying to create customers for life with this experience,” said Ariosa. “We’re very excited, and we think that’s going to help the experience. Everybody wants a good experience.” Hanna Casey said that increased training at her company has been a silver lining to the pandemic, noting that the brokerage recently introduced new marketing and technology products to assist their agents along with improved training opportunities. “Today, they are able to meet the consumer needs better than they could before, and what we found was that we, perhaps, were not doing enough training internally, and so we continue with that training,” Hanna Casey added. Rather than focusing on the shiny new tech options inundating the industry, Hanna Casey suggested that her family’s firm has doubled down on the tech solutions they’ve been using and building around them. Baur also weighed in on the topic, stating, “The best technology is the one you use, and the other is it’s still about relationships.” “We have to quit trying to over-apply technology to replace humans instead of applying it to help humans be better and particularly be better around relationships,” Baur added. Among the challenges that lie ahead in the industry—of which there are plenty—Dalton indicated that real estate professionals need to change their approach surrounding their databases and social media strategies. York Baur, CEO of MoxiWorks Dalton opined that there needs to be a greater focus on converting databases into client bases for agents. “Doctors, lawyers, and financial planners are focused on client bases while we’re focusing on databases,” he said. Dalton went on to state, “the industry is settling on paying tariffs on the buying side, and the only way they are going to preempt the listing side disruption is converting their database.” He also critiqued the overall approach to social media marketing. “A lot of agents are mimicking high school kids on TikTok, and they are not bringing value to the marketplace, and they are not engaged in social media marketing,” he said. According to Dalton, a significant threat facing the market is the decline in how consumers value real estate agents. “We don’t have an image problem, but when it comes to value, we do,” Dalton said, suggesting that most consumers perceive a real estate transaction as a “fee-inflated event which they have to subsidize in order to promulgate an inefficient industry.” “The fact that a homeowner can live in a town for ten years and then when they decide to move, they call a complete stranger is a colossal indictment to the industry,” Dalton continued. “These are very serious damaging issues to perceived value when people say artificial intelligence will transcend human reasoning.” Lamacchia echoed similar sentiments, stating, “it’s somewhat of an embarrassment of our industry that some people are going to financial advisors and lawyers for real estate advice before REALTORS®, but it’s our fault.” He indicated that he has been training agents on how to guide apprehensive sellers who want to sell and buy, which play a role in the lull of listings during the pandemic. “If even half the REALTORS® out there knew how to properly explain to a seller that ‘you can do this,’ you wouldn’t see inventory go as low as it does in the winter and stay that low as long,” Lamacchia added. Jordan Grice is RISMedia’s associate online editor. Email him your real estate news ideas to The post Frenzies and Bidding Wars: Leaders Share Tactics to Win in the Post-Pandemic Market appeared first on RISMedia......»»

Category: realestateSource: rismediaNov 17th, 2021

As Real Estate Changes, NAR’s Shannon McGahn Is Always Trying to Stay a Step Ahead

Real estate is a dynamic industry and one that’s only true constant is change. This has been evident to anyone who’s been following the industry since at least The Great Recession. And certainly the pandemic has reinforced that idea. The industry has seen moments of extreme lows and, now, extreme highs. Often, some of this […] The post As Real Estate Changes, NAR’s Shannon McGahn Is Always Trying to Stay a Step Ahead appeared first on RISMedia. Real estate is a dynamic industry and one that’s only true constant is change. This has been evident to anyone who’s been following the industry since at least The Great Recession. And certainly the pandemic has reinforced that idea. The industry has seen moments of extreme lows and, now, extreme highs. Often, some of this ebb and flow in real estate is impacted by public policy. It serves as a steward that can ensure stability in the market. And behind that policy are individuals like Shannon McGahn, chief advocacy officer at the National Association of REALTORS® (NAR). Given the weight of her role, and so much happening in real estate, and Washington D.C., we thought it would be a good time to catch up with her and learn more about what she and her team at NAR have been up to, and what critical pieces of policy real estate professionals should be monitoring. Caysey Welton: First, tell us about your role as chief advocacy officer—both from a high level and on a day-to-day basis. Shannon McGahn: The advocacy group supports the policies and the policymakers who support our members and the real estate industry, which is a pillar of the American economy. Taking over the chief advocacy officer position during the middle of a pandemic was not an experience that came with any playbook. Advocacy is about real relationships, not virtual ones. Usually, the chief advocacy officer would count steps running through the halls of Congress. But so far, day-to-day life relies more on Zooming around Congress. The challenges of the pandemic wreaked havoc on the Congressional calendar, with massive relief bills passing one after another. Add in a power change in government, and 2021 was not for the weary in Washington. Thankfully, NAR has an impressive team of leaders to help drive the association’s advocacy efforts. Bryan Greene leads the policy team. He came to us from HUD, where he served as the longtime director of fair housing. This team has faced an enormous task with a new administration and congressional majority eager to enact widespread change. Bryan and his team monitor policies coming out of the executive branch, proposing changes and new directions. Joe Harris and Helen Devlin, both seasoned NAR and Washington pros, lead congressional advocacy. Their team educates lawmakers and advocates for the entire industry, including consumers. On top of this work at the federal level, perhaps our most significant focus is state and local association engagement. We work on everything from local ballot initiatives to community grants to ensure our members are active at all levels. CW: How has a role like yours changed within the organization, and what initiatives have you introduced since taking on the role? SM: Under CEO Bob Goldberg’s leadership, we took on a mission to modernize advocacy with a renewed focus on cultivating relationships both within our organization and externally—with policymakers, industry partners, and state and local associations. This modernization has paid off in ways that we could never have imagined as the pandemic overtook the agenda at all levels of government. Without our established relationships and decades of educating elected officials, we could not have navigated these past two years as well as we did. And we did it all virtually—from our living rooms and basements and even a few hands-free Zoom sessions in the car, which gave me a new appreciation for how excited my dogs get to go for a ride! Our new advocacy structure also relies on a team of political representatives that travel the country speaking with REALTORS®, GADs, AEs and communications directors at all levels. And our legislative and policy representatives use that information to take their message directly to elected officials. The lines of communication are more open than ever. There is no such thing as a federal issue versus a state or local issue. If it impacts one of us, it impacts all of us. Collaboration at all levels is essential to our overall success. Our advocacy operation is effective, bipartisan and truly the envy of Washington. CW: What makes NAR’s advocacy team so unique from other trade associations? SM: There is no other trade association in Washington like NAR for one reason: our members. We don’t represent an industry; we represent 1.5 million individuals. They are thoughtful, civically engaged and pillars of their communities. It is an army that equals the populations of San Diego or the state of Hawaii. We are also the largest bipartisan trade organization in America. We live “REALTOR® Party purple.” The roots of our advocacy successes are the REALTOR® Party model that is issue-focused, not party-focused. Power comes and goes for political parties, but our issues stay front and center. We have friends in all political corners in times of need and normalcy. CW: You’re approaching a year on the job, so what would you consider your biggest wins thus far? SM: In all, six COVID relief bills passed between March 2020 and March 2021, and NAR had its imprint on each one. We helped secure an array of benefits to ensure the health and economic wellbeing of REALTORS® during the pandemic. The self-employed, independent contractors and sole proprietors were all eligible for new federal benefits, which was unprecedented. Many REALTORS®, mostly small business owners, could access Pandemic Unemployment Assistance, Paycheck Protection Program loans, Economic Injury Disaster Loans, and paid sick and family leave. As lockdowns swept the country, we leveraged every relationship and resource to get real estate deemed an essential service in jurisdictions nationwide. It was a messy process, but we got it done. As the pandemic entered a second calendar year, NAR helped secure nearly $50 billion in rental assistance in two separate bills to cover up to a year-and-a-half of combined back and future rent for struggling tenants and small housing providers. And we supported a legal fight on the CDC eviction ban that ended up before the Supreme Court, where a favorable ruling helped protect property rights now and in the future. Real estate makes up one-fifth of the entire U.S. economy, so our industry and NAR played a big part in the nation’s economic resilience. There is now clear evidence that the rescue measures and programs we fought so hard for were vital to our country’s economic health. CW: From your perspective, in terms of policy, what do you see as the most significant challenges or threats for your association members and how are you addressing it/them? SM: Congress is debating President Biden’s Build Back Better plan that, if enacted, would provide a historic investment in the country’s social safety net. Some of the earlier tax proposals to pay for the plan could have devastated the real estate sector. We built our advocacy operation for crossroads moments like these and worked to educate lawmakers on these tax issues for more than a year. Our FPCs contacted every member of the tax-writing committees in the House and Senate in a targeted Call for Action. When President Biden released the long-awaited bill framework in October, the most feared taxes and limits on real estate investment were not included. It contained no 1031 like-kind exchange limits, no capital gains tax increases, no change in step-up in basis, no tax on unrealized capital gains, no increased estate tax, no carried interest provisions and no 199A deduction limits. It was a positive development for consumers, property owners and the real estate economy. We also feared lawmakers would strip affordable housing provisions from the bill as they worked to narrow the legislation. Affordable housing is a key NAR priority and the key to unlocking prosperity for millions of Americans currently excluded from the American Dream. This investment is critical for closing the racial homeownership gap and addressing income disparity.  It opens up homeownership for first-generation and first-time buyers. We continued to press both publicly and privately for these provisions. Bob Goldberg joined other housing leaders and members of Congress at the U.S. Capitol for a press conference calling for affordable housing provisions in the final bill. And just days later, the new framework included $150 billion for affordable housing. A key member of Congress said it was because of NAR’s support. Under the agreement, public housing and rental assistance would get funding boosts.  The plan would also create more than one million new affordable rental and single-family homes and invest in down-payment assistance. The exclusion of harmful real estate investment taxes and the inclusion of affordable housing provisions in the bill are a testament to the effectiveness of our education campaign in Washington. CW: Without speculating too much, are there any policy issues that could become potentially problematic for real estate? SM: Like many other sectors of the economy, supply issues are also hitting real estate.  But the pandemic isn’t the only reason. The housing shortage existed before the pandemic—and will exist long afterward. NAR commissioned a study by Rosen Consulting Group earlier this year and found the U.S. is short about six million residential housing units. Those hit hardest are the middle class, millennials and first-time and first-generation homebuyers. It is fair to say the housing supply shortage rises to the level of a crisis.  Without a coordinated, national effort, the housing shortage will persist. We need it all: affordable, market-rate, single-family and multifamily housing. Builders would need to exceed the long-term historical average pace of 1.5 million units a year to shrink the supply deficit. Even at 2.1 million units a year, near the level reached in 2005, it would take a decade to close the gap. A package of policy responses is needed to increase the housing supply. Solutions include funding affordable housing construction, preserving and expanding tax incentives to renovate distressed properties, converting unused commercial space to residential, and incentives for zoning reform. Addressing the housing shortage isn’t just good for real estate. It is good for the economy. Expanding new-home construction to more than two million units a year for ten years would create 2.8 million new jobs and generate more than $400 billion in economic activity. CW: Likewise, are there any new policies recently enacted, or that you’re advocating for, that real estate professionals should be aware of and embrace? SM: On Oct. 1, FEMA’s new flood insurance pricing system, Risk Rating 2.0, went into effect for new policies. NAR spent nearly a decade working with FEMA on this new system that prices each home individually and more accurately using modern technologies, standards and science. So far, we see a few very high-risk, high-value properties with higher NFIP premiums under the new system. But homeowners need to know the true cost to insure these properties so they can make informed decisions. Many other policyholders, especially those with lower-value homes, will see decreases. Too often, under the old system, low-value properties were subsidizing high-value properties. Risk Rating 2.0 is a win for consumers. The previous 50-year-old system simply could not stay the way it was. Caysey Welton is RISMedia’s content director. Email him your real estate news ideas to The post As Real Estate Changes, NAR’s Shannon McGahn Is Always Trying to Stay a Step Ahead appeared first on RISMedia......»»

Category: realestateSource: rismediaNov 16th, 2021

Radical Rent Control Measure Blows Up In St. Paul In Less Than A Week

Radical Rent Control Measure Blows Up In St. Paul In Less Than A Week Authored by Mike Shedlock via, Unlike almost every rent control law in the country, the ordinance passed by St. Paul voters includes no exemption for new construction... A radical rent control measures capping increases at 3% passed in St. Paul Minnesota. The payback was immediate.  Reason reports Developers Halt Projects, Mayor Demands Reform After St. Paul Voters Approve Radical Rent Control Ballot Initiative. In last Tuesday's municipal election, 52 percent of voters approved Question 1, an ordinance that puts a hard annual 3 percent cap on rent increases. It makes no allowances for inflation or exemptions for vacant apartments and new construction that are typical in other rent control policies. The new ordinance doesn't go into effect until May 2022. Nevertheless, several real estate companies with large projects in the works have already announced that they're pulling their permit applications. That includes Ryan Companies. Local NBC affiliate KARE 11 reports that the company pulled applications for three buildings in its proposed 3,800-unit Highland Bridge project. Other developers are singing a similar tune. "We, like everybody else, are re-evaluating what—if any—future business activity we'll be doing in St. Paul," Jim Stolpestad, founder of development company Exeter, told the Minneapolis Star-Tribune. The Star-Tribune reports that developers have also been calling Nicolle Goodman, the city's director of planning and economic development, to say that they were placing hundreds of new units on hold in response to the passage of rent control. All of this could well encourage landlords to just get out of the rental market altogether and sell their properties to owner-occupiers. Rising home values in St. Paul, where prices have increased 12 percent in the last year, only make this option more attractive for landlords. This is what happened in San Francisco where an expansion of preexisting rent controls led to a 15 percent reduction in the supply of rental housing, according to one 2018 study. That study found that incumbent tenants benefited handsomely from the limits on rent increases but that their windfall came "at the great expense of welfare losses from future inhabitants." Mayoral Lie Despite the insanity of doing something that's tried and failed everywhere, St. Paul voters upped the ante by passing the most restrictive measure ever. Blame Mayor Melvin Carter. He backed the initiative and it only barely passed. Carter's not so brilliant idea (lie) was he could amend the law after it passed. Whatever the outcome of this ballot question, our work will continue. Bold action on our housing and equity goals cannot wait. (2/2) — Melvin Carter (@melvincarter3) October 12, 2021 But he can't materially change the bill nor can the city council.  The problem for Carter, which he knew in advance, is the council cannot by law make "substantive" changes to the law.  The city council president admitted what Carter now wants to do is "substantive". Rent Control Advocates Celebrate  Despite the clear housing disaster that awaits, Rent Control Advocates Celebrate.  “We didn’t wait for policymakers or funders. We leveraged the power of the people and direct democracy to do this for ourselves,” said Danielle Swift, an organizer with the Frogtown Neighborhood Association. “Text banking, phone banking, door-to-door, 100 percent grassroots organizing got it done.” Alarmed by overnight rent hikes for low-income tenants, organizations such as the Housing Justice Center, TakeAction Minnesota, the Alliance and the West Side Community Organization gathered signatures to get their own rent-control proposal on the Nov. 2 ballot by petition. Swift blamed “generations of economic exploitation and exclusion from homeownership” for marginalizing communities of color — some 82 percent of the city’s Black households rent, compared to 39 percent of white households.  “This policy will have a dramatic and immediate impact in advancing housing and racial justice in our city,” she said. Shortages Loom Judging from rent prices, there is already a severe shortage of housing in St. Paul. The most likely reason is fear of something like this or insurance and maintenance hikes in the wake of George Floyd riots. And now that the bill has passed many new development projects, some for thousands of units, were cancelled.  Small landlords will sell to live-in owners further reducing supply.  Finally, with 3% caps regardless of tax hikes, inflation or any other issues, landlords will not make capital improvements to their property. The overall quality of remaining rental units is sure to decline. *  *  * Like these reports? If so, please Subscribe to MishTalk Email Alerts. Tyler Durden Sun, 11/14/2021 - 16:00.....»»

Category: blogSource: zerohedgeNov 14th, 2021

Gowanus locals reach deal that paves way for rezoning

Council Members Brad Lander and Stephen Levin, leaders of Brooklyn Community Board 6, and members of the Gowanus Neighborhood Coalition for Justice, announced this morning that they have reached consensus with the de Blasio Administration on “Points of Agreement” (POA) that ensure the Gowanus Neighborhood Rezoning will meet community goals.... The post Gowanus locals reach deal that paves way for rezoning appeared first on Real Estate Weekly. Council Members Brad Lander and Stephen Levin, leaders of Brooklyn Community Board 6, and members of the Gowanus Neighborhood Coalition for Justice, announced this morning that they have reached consensus with the de Blasio Administration on “Points of Agreement” (POA) that ensure the Gowanus Neighborhood Rezoning will meet community goals. The Gowanus Neighborhood Rezoning, the largest under the de Blasio Administration, will enable the construction of approximately 8,000 new housing units, nearly 3,000 of them affordable to low- and moderate-income families in a mixed-use, mixed-income neighborhood around a remediated and revitalized Gowanus Canal. The rezoning includes the most stringent affordability and sustainability requirements of any previous neighborhood rezoning. The “Points of Agreement” between City Hall and the Council Members, the result of extensive community organizing and public engagement, provides that every one of the 1,662 units in NYCHA’s Gowanus Houses and Wyckoff Gardens developments will receive a comprehensive interior modernization estimated at $200 million. The City will invest hundreds of millions more in flooding and stormwater infrastructure, parks, schools, and workforce development, and substantial funding commitments for renovations at the Pacific Branch Library ($14.7 million) and the Old Stone House ($10.95 million).  Community conversations about the future of the neighborhood have been active for nearly a decade, including the “Bridging Gowanus” community planning process convened by Council Member Lander’s office in 2013, that worked to identify shared principles for any development in the area. The Department of City Planning commenced its community engagement in 2016 with five working groups open to all community members and scores of public meetings, attended by thousands of residents and stakeholders. The Gowanus Neighborhood Coalition for Justice, a coalition of tenants, homeowners, public housing residents, small business owners, artists, environmentalists, and affordable housing advocates, organized hundreds of residents to elevate the voices of community members usually left out of the City’s planning processes. GNCJ developed a broad community platform, including three key demands that today’s Points of Agreement address: Upfront funding to meet the capital needs of the public housing in the Gowanus neighborhood, with oversight by NYCHA residents.POA commitment: The City will fund comprehensive in-unit renovations of all apartments at Gowanus Houses (1,134 units) and Wyckoff Houses (528 units) at an estimated cost of $200m. This work includes replacement of kitchens, bathrooms, plumbing, electrical, flooring, interior doors, and lighting fixtures. The City has additionally committed to regular reporting and consultation with residents through the construction process to oversee commitments and protect tenant rights. The City will also fulfill previous commitment to renovate and reopen the Wyckoff Gardens and Gowanus Houses community centers.Mandate “net-zero” combined sewage overflow (CSO) from new construction created as a result of the rezoning.POA commitment: In order to ensure that new development does not pollute the Gowanus Canal, the City has adopted the stringent new 2021 Unified Stormwater Rule that will go into effect before any construction begins. The rule increases on-site requirements for stormwater detention and introduces new retention requirements, which will reduce CSO volumes and events, and help address localized flooding. The City is also committing to a $174 million upgrade to sewer infrastructure to address long-standing flooding along 4th Avenue, which is especially severe at the intersection of Carroll Street.   Gowanus Rezoning Oversight Task Force to monitor compliance with public and private commitments.POA commitment: To ensure compliance with public and private commitments, the agreement includes commitments by all relevant City agencies to regular reporting as well as senior agency staff participation in a Community Oversight Task Force dedicated to monitoring rezoning-related commitments. The Task Force will be supported by an independent facilitator, and include representation from elected officials, CB6, NYCHA residents and leaders, and core community organizations and stakeholders.  On June 3, 2021, Community Board 6 held a highly-attended, indoor/outdoor, hybrid in-person and online public hearing as part of the Uniform Land Use Review Process (with additional opportunities for public input ordered by Judge Katherine Levine pursuant to a lawsuit). Out of that hearing, CB6 voted “Yes with Modifications,” including an extensive set of recommendations that are reflected in today’s agreement. Borough President Eric Adams also recommended to approve the rezoning with modifications, and stood with public housing residents, GNCJ members, and the Council Member to insist on adequate funding for public housing. The Gowanus Neighborhood Rezoning is the first MIH neighborhood rezoning in a whiter, wealthier neighborhood. For the first time ever, a Racial Impact Study was completed providing strong evidence that the plan will result in a more racially and economically inclusive neighborhood.  In addition to historic investments in public housing, stormwater retention, and flood readiness, the Gowanus Neighborhood Rezoning includes:  Nearly 3,000 units of affordable housing, including a commitment to 100% affordability on the City-owned Public Place site. The plan for Gowanus Green includes approximately 950 units priced for extremely low to low income tenants and homeownership opportunities for moderate income families, as well as a new 1.5 acre park and space for a potential new school. The Gowanus Green site will be extensively remediated, under the supervision of the EPA, NYS DEC, and NYC DEP. The EPA has stated that it is feasible for the site to be cleaned up to safely allow for these uses.On sites, the rezoning will require either Mandatory Inclusionary Housing (MIH) Option 1, which requires 25% of units affordable to households at or below 60% of AMI, with 10% of units affordable to households at or below 40% of AMI; or the “deep affordability” MIH option of 20% of units affordable to households at our below 40% of AMI ($43,000 for a family of 3). This is anticipated to generate approximately 2000 affordable units.Investments in new open space, including a resilient waterfront esplanade along the Gowanus Canal. The City has committed to renovations, following meaningful community engagement, at the new Gowanus Green public park and Boerum Park, and Thomas Greene Park. It has committed to build new public spaces on the Salt Lot and the Head End CSO site, following construction of each Superfund-mandated CSO tank, the Bond Street Street-End and at “Transit Plaza” along the Canal by the Smith/9th subway station. Canal developers will be required to build and maintain a new 40-foot public esplanade, following detailed guidelines to ensure continuity and public access between sites, and designed for flood resiliency through the year 2100.Environmental requirements on new development. In addition to the waterfront esplanade and new stormwater management requirements, all new buildings must: Dedicate 100% of their rooftop area to solar, wind, or green infrastructure pursuant to City legislation from 2019. Meet city flood elevation standards, determined on a site-by-site basis, which exceed FEMA standards. Complete remediation of any contamination indicated by the new e-designation, with oversight by the City and State. Innovative new zoning tools to address infrastructure needs. To ensure local school capacity can accommodate neighborhood growth, on certain large sites around the canal, developers can exempt floor area leased to NYC School Construction Authority for the development of new public schools as new seat-need comes online.The plan includes an easement requirement and new citywide transit bonus available for developers along 4th Avenue in exchange for transit improvements. Historic preservation and tools to keep Gowanus creative and mixed-use.  Five historic buildings were designated as landmarks during the rezoning process, including the Old American Can Factory and Powerhouse Arts.Mid-block areas will remain zoned for industrial and commercial use, with modest additional development rights that do not allow for hotels or self-storage. The new “Gowanus Mix” use group codified in zoning will generate over 300,000 square feet dedicated space for light manufacturing, arts, and non-profits.Community, social service, and workforce development resources.City Hall will expand the MAP (Mayor’s Action Plan for Neighborhood Safety) initiative to Gowanus Houses and Wyckoff Gardens, an investment of approximately $2 million annually. MAP brings together neighborhood residents and government agencies to reduce crime. Strategies including youth development and employment, conflict mediation, sports and arts programs aim to address concentrated disadvantage and physical disorder and promote neighborhood cohesion and strong citywide networks.Investments of approximately $1 million annually in workforce development for local residents, with a focus on NYCHA residents, including dedicated funding for industrial job training.Commitments to street safety improvements at high-crash intersections and a comprehensive traffic study of 3rd avenue and the IBZ to address road safety and truck circulation issues. The City will provide over $10 million for new curb extensions and widened sidewalks, bioswales and other green infrastructure, and street furniture such as benches, wayfinding signs, bike racks, and street trees.Tenant protections including an expanded Certificate of No Harassment program (recently adopted citywide through legislation sponsored by Council Member Lander), resources for tenant outreach, and a tailored rezoning that protects rent-stabilized units.  The full Points of Agreement document will be available at the City Council’s Zoning Subcommittee meeting prior to the vote today. In addition to the public commitments in the rezoning plan, developers in Gowanus have committed to additional affordability and use restrictions to preserve the industrial and arts character of the neighborhood. Affordable artists studios: 10 property owners of large sites along the Canal and bordering Thomas Greene Park have committed to enter an agreement with Arts Gowanus to provide over 150 permanently-affordable artist studios in new developments. Arts Gowanus will match eligible artists with available spaces. A portion of the studios will be available for low-income artists, including NYCHA residents, to rent at a more deeply reduced rate. As a part of the agreement, Arts Gowanus will occupy and manage a Gowanus Community Arts Center, including a gallery. Parks Improvement District: Ten developers have committed to cooperate in the formation of a Gowanus Waterfront Business Improvement District focused on stewardship, access, and public programming of open spaces, especially the new waterfront esplanade along the canal. This entity will provide maintenance, public programming, technical assistance, and environmental and ecological advocacy. The steering committee is expected to hold its first meeting in December 2021, and will flesh out details and develop support with input from community members and stakeholders.  All told, the Gowanus Rezoning’s 3,000 new units of permanently affordable housing, a continuous public esplanade along the waterfront, climate-resilient buildings and landscaping, and use restrictions to preserve arts and industry are among the most aggressive, forward-looking set of requirements ever imposed on developers in the United States.  “Today’s agreement shows that community-led, inclusive, sustainable growth is possible. After nearly a decade of conversations among neighbors, and in partnership with the Department of City Planning and City Hall, this community has created one of the best models for inclusive growth anywhere, with strong attention to equity and affordability, and mindful of the environmental history and future of this area. Debates about development are not easy, but I am truly proud of the way we’ve engaged them here. Together, we are setting the stage for a more diverse, more sustainable, thriving, creative neighborhood that will welcome new residents while improving and preserving the ability of public housing residents, artists, small businesses, and neighbors to continue to thrive here for generations to come,” said Council Member Brad Lander. “The Gowanus Rezoning will be a milestone in land use actions in New York City,” said Council Member Stephen Levin.  “Discussions about the Gowanus neighborhood, one of the most vibrant and historic in Brooklyn, have been ongoing for decades. And today we reach a turning point where those discussions have resulted in action. This rezoning will result in not only new housing including a substantial increase in affordable units, but unprecedented investments in our public housing, improvements in the sewer systems and monitoring of our combined sewer overflows, preservation of manufacturing and light industry, and a commitment to protect our artists and public spaces.  There are so many people that helped bring us here but first and foremost I want to thank the residents of Wyckoff Gardens and GowanusHouse and the members of the Gowanus Neighborhood Coalition for Justice. They provide a guide to making sure we are always focused on what is most important. And of course thanks to all the staff and Councilmember Lander who attended more meetings then we can count in the name of true engagement. This process only begins here and it is up to the future elected officials to ensure that all the promises are met but we couldn’t have given them a better place to start.” The post Gowanus locals reach deal that paves way for rezoning appeared first on Real Estate Weekly......»»

Category: realestateSource: realestateweeklyNov 10th, 2021

Bitcoin & The US Fiscal Reckoning

Bitcoin & The US Fiscal Reckoning Authored by Avik Roy via, Cryptocurrencies like bitcoin have few fans in Washington. At a July congressional hearing, Senator Elizabeth Warren warned that cryptocurrency "puts the [financial] system at the whims of some shadowy, faceless group of super-coders." Treasury secretary Janet Yellen likewise asserted that the "reality" of cryptocurrencies is that they "have been used to launder the profits of online drug traffickers; they've been a tool to finance terrorism." Thus far, Bitcoin's supporters remain undeterred. (The term "Bitcoin" with a capital "B" is used here and throughout to refer to the system of cryptography and technology that produces the currency "bitcoin" with a lowercase "b" and verifies bitcoin transactions.) A survey of 3,000 adults in the fall of 2020 found that while only 4% of adults over age 55 own cryptocurrencies, slightly more than one-third of those aged 35-44 do, as do two-fifths of those aged 25-34. As of mid-2021, Coinbase — the largest cryptocurrency exchange in the United States — had 68 million verified users. To younger Americans, digital money is as intuitive as digital media and digital friendships. But Millennials with smartphones are not the only people interested in bitcoin; a growing number of investors are also flocking to the currency's banner. Surveys indicate that as many as 21% of U.S. hedge funds now own bitcoin in some form. In 2020, after considering various asset classes like stocks, bonds, gold, and foreign currencies, celebrated hedge-fund manager Paul Tudor Jones asked, "[w]hat will be the winner in ten years' time?" His answer: "My bet is it will be bitcoin." What's driving this increased interest in a form of currency invented in 2008? The answer comes from former Federal Reserve chairman Ben Bernanke, who once noted, "the U.S. government has a technology, called a printing press...that allows it to produce as many U.S. dollars as it wishes at essentially no cost. By increasing the number of U.S. dollars in circulation...the U.S. government can also reduce the value of a dollar in terms of goods and services, which is equivalent to...inflation." In other words, governments with fiat currencies — including the United States — have the power to expand the quantity of those currencies. If they choose to do so, they risk inflating the prices of necessities like food, gas, and housing. In recent months, consumers have experienced higher price inflation than they have seen in decades. A major reason for the increases is that central bankers around the world — including those at the Federal Reserve — sought to compensate for Covid-19 lockdowns with dramatic monetary inflation. As a result, nearly $4 trillion in newly printed dollars, euros, and yen found their way from central banks into the coffers of global financial institutions. Jerome Powell, the current Federal Reserve chairman, insists that 2021's inflation trends are "transitory." He may be right in the near term. But for the foreseeable future, inflation will be a profound and inescapable challenge for America due to a single factor: the rapidly expanding federal debt, increasingly financed by the Fed's printing press. In time, policymakers will face a Solomonic choice: either protect Americans from inflation, or protect the government's ability to engage in deficit spending. It will become impossible to do both. Over time, this compounding problem will escalate the importance of Bitcoin. THE FIAT-CURRENCY EXPERIMENT It's becoming clear that Bitcoin is not merely a passing fad, but a significant innovation with potentially serious implications for the future of investment and global finance. To understand those implications, we must first examine the recent history of the primary instrument that bitcoin was invented to challenge: the American dollar. Toward the end of World War II, in an agreement hashed out by 44 Allied countries in Bretton Woods, New Hampshire, the value of the U.S. dollar was formally fixed to 1/35th of the price of an ounce of gold. Other countries' currencies, such as the British pound and the French franc, were in turn pegged to the dollar, making the dollar the world's official reserve currency. Under the Bretton Woods system, foreign governments could retrieve gold bullion they had sent to the United States during the war by exchanging dollars for gold at the relevant fixed exchange rate. But enabling every major country to exchange dollars for American-held gold only worked so long as the U.S. government was fiscally and monetarily responsible. By the late 1960s, it was neither. Someone needed to pay the steep bills for Lyndon Johnson's "guns and butter" policies — the Vietnam War and the Great Society, respectively — so the Federal Reserve began printing currency to meet those obligations. Johnson's successor, Richard Nixon, also pressured the Fed to flood the economy with money as a form of economic stimulus. From 1961 to 1971, the Fed nearly doubled the circulating supply of dollars. "In the first six months of 1971," noted the late Nobel laureate Robert Mundell, "monetary expansion was more rapid than in any comparable period in a quarter century." That year, foreign central banks and governments held $64 billion worth of claims on the $10 billion of gold still held by the United States. It wasn't long before the world took notice of the shortage. In a classic bank-run scenario, anxious European governments began racing to redeem dollars for American-held gold before the Fed ran out. In July 1971, Switzerland withdrew $50 million in bullion from U.S. vaults. In August, France sent a destroyer to escort $191 million of its gold back from the New York Federal Reserve. Britain put in a request for $3 billion shortly thereafter. Finally, that same month, Nixon secretly gathered a small group of trusted advisors at Camp David to devise a plan to avoid the imminent wipeout of U.S. gold vaults and the subsequent collapse of the international economy. There, they settled on a radical course of action. On the evening of August 15th, in a televised address to the nation, Nixon announced his intention to order a 90-day freeze on all prices and wages throughout the country, a 10% tariff on all imported goods, and a suspension — eventually, a permanent one — of the right of foreign governments to exchange their dollars for U.S. gold. Knowing that his unilateral abrogation of agreements involving dozens of countries would come as a shock to world leaders and the American people, Nixon labored to re-assure viewers that the change would not unsettle global markets. He promised viewers that "the effect of this action...will be to stabilize the dollar," and that the "dollar will be worth just as much tomorrow as it is today." The next day, the stock market rose — to everyone's relief. The editors of the New York Times "unhesitatingly applaud[ed] the boldness" of Nixon's move. Economic growth remained strong for months after the shift, and the following year Nixon was re-elected in a landslide, winning 49 states in the Electoral College and 61% of the popular vote. Nixon's short-term success was a mirage, however. After the election, the president lifted the wage and price controls, and inflation returned with a vengeance. By December 1980, the dollar had lost more than half the purchasing power it had back in June 1971 on a consumer-price basis. In relation to gold, the price of the dollar collapsed — from 1/35th to 1/627th of a troy ounce. Though Jimmy Carter is often blamed for the Great Inflation of the late 1970s, "the truth," as former National Economic Council director Larry Kudlow has argued, "is that the president who unleashed double-digit inflation was Richard Nixon." In 1981, Federal Reserve chairman Paul Volcker raised the federal-funds rate — a key interest-rate benchmark — to 19%. A deep recession ensued, but inflation ceased, and the U.S. embarked on a multi-decade period of robust growth, low unemployment, and low consumer-price inflation. As a result, few are nostalgic for the days of Bretton Woods or the gold-standard era. The view of today's economic establishment is that the present system works well, that gold standards are inherently unstable, and that advocates of gold's return are eccentric cranks. Nevertheless, it's important to remember that the post-Bretton Woods era — in which the supply of government currencies can be expanded or contracted by fiat — is only 50 years old. To those of us born after 1971, it might appear as if there is nothing abnormal about the way money works today. When viewed through the lens of human history, however, free-floating global exchange rates remain an unprecedented economic experiment — with one critical flaw. An intrinsic attribute of the post-Bretton Woods system is that it enables deficit spending. Under a gold standard or peg, countries are unable to run large budget deficits without draining their gold reserves. Nixon's 1971 crisis is far from the only example; deficit spending during and after World War I, for instance, caused economic dislocation in numerous European countries — especially Germany — because governments needed to use their shrinking gold reserves to finance their war debts. These days, by contrast, it is relatively easy for the United States to run chronic deficits. Today's federal debt of almost $29 trillion — up from $10 trillion in 2008 and $2.4 trillion in 1984 — is financed in part by U.S. Treasury bills, notes, and bonds, on which lenders to the United States collect a form of interest. Yields on Treasury bonds are denominated in dollars, but since dollars are no longer redeemable for gold, these bonds are backed solely by the "full faith and credit of the United States." Interest rates on U.S. Treasury bonds have remained low, which many people take to mean that the creditworthiness of the United States remains healthy. Just as creditworthy consumers enjoy lower interest rates on their mortgages and credit cards, creditworthy countries typically enjoy lower rates on the bonds they issue. Consequently, the post-Great Recession era of low inflation and near-zero interest rates led many on the left to argue that the old rules no longer apply, and that concerns regarding deficits are obsolete. Supporters of this view point to the massive stimulus packages passed under presidents Donald Trump and Joe Biden  that, in total, increased the federal deficit and debt by $4.6 trillion without affecting the government's ability to borrow. The extreme version of the new "deficits don't matter" narrative comes from the advocates of what has come to be called Modern Monetary Theory (MMT), who claim that because the United States controls its own currency, the federal government has infinite power to increase deficits and the debt without consequence. Though most mainstream economists dismiss MMT as unworkable and even dangerous, policymakers appear to be legislating with MMT's assumptions in mind. A new generation of Democratic economic advisors has pushed President Biden to propose an additional $3.5 trillion in spending, on top of the $4.6 trillion spent on Covid-19 relief and the $1 trillion bipartisan infrastructure bill. These Democrats, along with a new breed of populist Republicans, dismiss the concerns of older economists who fear that exploding deficits risk a return to the economy of the 1970s, complete with high inflation, high interest rates, and high unemployment. But there are several reasons to believe that America's fiscal profligacy cannot go on forever. The most important reason is the unanimous judgment of history: In every country and in every era, runaway deficits and skyrocketing debt have ended in economic stagnation or ruin. Another reason has to do with the unusual confluence of events that has enabled the United States to finance its rising debts at such low interest rates over the past few decades — a confluence that Bitcoin may play a role in ending. DECLINING FAITH IN U.S. CREDIT To members of the financial community, U.S. Treasury bonds are considered "risk-free" assets. That is to say, while many investments entail risk — a company can go bankrupt, for example, thereby wiping out the value of its stock — Treasury bonds are backed by the full faith and credit of the United States. Since people believe the United States will not default on its obligations, lending money to the U.S. government — buying Treasury bonds that effectively pay the holder an interest rate — is considered a risk-free investment. The definition of Treasury bonds as "risk-free" is not merely by reputation, but also by regulation. Since 1988, the Switzerland-based Basel Committee on Banking Supervision has sponsored a series of accords among central bankers from financially significant countries. These accords were designed to create global standards for the capital held by banks such that they carry a sufficient proportion of low-risk and risk-free assets. The well-intentioned goal of these standards was to ensure that banks don't fail when markets go down, as they did in 2008. The current version of the Basel Accords, known as "Basel III," assigns zero risk to U.S. Treasury bonds. Under Basel III's formula, then, every major bank in the world is effectively rewarded for holding these bonds instead of other assets. This artificially inflates demand for the bonds and enables the United States to borrow at lower rates than other countries. The United States also benefits from the heft of its economy as well as the size of its debt. Since America is the world's most indebted country in absolute terms, the market for U.S. Treasury bonds is the largest and most liquid such market in the world. Liquid markets matter a great deal to major investors: A large financial institution or government with hundreds of billions (or more) of a given currency on its balance sheet cares about being able to buy and sell assets while minimizing the impact of such actions on the trading price. There are no alternative low-risk assets one can trade at the scale of Treasury bonds. The status of such bonds as risk-free assets — and in turn, America's ability to borrow the money necessary to fund its ballooning expenditures — depends on investors' confidence in America's creditworthiness. Unfortunately, the Federal Reserve's interference in the markets for Treasury bonds have obscured our ability to determine whether financial institutions view the U.S. fiscal situation with confidence. In the 1990s, Bill Clinton's advisors prioritized reducing the deficit, largely out of a conern that Treasury-bond "vigilantes" — investors who protest a government's expansionary fiscal or monetary policy by aggressively selling bonds, which drives up interest rates — would harm the economy. Their success in eliminating the primary deficit brought yields on the benchmark 10-year Treasury bond down from 8% to 4%. In Clinton's heyday, the Federal Reserve was limited in its ability to influence the 10-year Treasury interest rate. Its monetary interventions primarily targeted the federal-funds rate — the interest rate that banks charge each other on overnight transactions. But in 2002, Ben Bernanke advocated that the Fed "begin announcing explicit ceilings for yields on longer-maturity Treasury debt." This amounted to a schedule of interest-rate price controls. Since the 2008 financial crisis, the Federal Reserve has succeeded in wiping out bond vigilantes using a policy called "quantitative easing," whereby the Fed manipulates the price of Treasury bonds by buying and selling them on the open market. As a result, Treasury-bond yields are determined not by the free market, but by the Fed. The combined effect of these forces — the regulatory impetus for banks to own Treasury bonds, the liquidity advantage Treasury bonds have in the eyes of large financial institutions, and the Federal Reserve's manipulation of Treasury-bond market prices — means that interest rates on Treasury bonds no longer indicate the United States' creditworthiness (or lack thereof). Meanwhile, indications that investors are growing increasingly concerned about the U.S. fiscal and monetary picture — and are in turn assigning more risk to "risk-free" Treasury bonds — are on the rise. One such indicator is the decline in the share of Treasury bonds owned by outside investors. Between 2010 and 2020, the share of U.S. Treasury securities owned by foreign entities fell from 47% to 32%, while the share owned by the Fed more than doubled, from 9% to 22%. Put simply, foreign investors have been reducing their purchases of U.S. government debt, thereby forcing the Fed to increase its own bond purchases to make up the difference and prop up prices. Until and unless Congress reduces the trajectory of the federal debt, U.S. monetary policy has entered a vicious cycle from which there is no obvious escape. The rising debt requires the Treasury Department to issue an ever-greater quantity of Treasury bonds, but market demand for these bonds cannot keep up with their increasing supply. In an effort to avoid a spike in interest rates, the Fed will need to print new U.S. dollars to soak up the excess supply of Treasury bonds. The resultant monetary inflation will cause increases in consumer prices. Those who praise the Fed's dramatic expansion of the money supply argue that it has not affected consumer-price inflation. And at first glance, they appear to have a point. In January of 2008, the M2 money stock was roughly $7.5 trillion; by January 2020, M2 had more than doubled, to $15.4 trillion. As of July 2021, the total M2 sits at $20.5 trillion — nearly triple what it was just 13 years ago. Over that same period, U.S. GDP increased by only 50%. And yet, since 2000, the average rate of growth in the Consumer Price Index (CPI) for All Urban Consumers — a widely used inflation benchmark — has remained low, at about 2.25%. How can this be? The answer lies in the relationship between monetary inflation and price inflation, which has diverged over time. In 2008, the Federal Reserve began paying interest to banks that park their money with the Fed, reducing banks' incentive to lend that money out to the broader economy in ways that would drive price inflation. But the main reason for the divergence is that conventional measures like CPI do not accurately capture the way monetary inflation is affecting domestic prices. In a large, diverse country like the United States, different people and different industries experience price inflation in different ways. The fact that price inflation occurs earlier in certain sectors of the economy than in others was first described by the 18th-century Irish-French economist Richard Cantillon. In his 1730 "Essay on the Nature of Commerce in General," Cantillon noted that when governments increase the supply of money, those who receive the money first gain the most benefit from it — at the expense of those to whom it flows last. In the 20th century, Friedrich Hayek built on Cantillon's thinking, observing that "the real harm [of monetary inflation] is due to the differential effect on different prices, which change successively in a very irregular order and to a very different degree, so that as a result the whole structure of relative prices becomes distorted and misguides production into wrong directions." In today's context, the direct beneficiaries of newly printed money are those who need it the least. New dollars are sent to banks, which in turn lend them to the most creditworthy entities: investment funds, corporations, and wealthy individuals. As a result, the most profound price impact of U.S. monetary inflation has been on the kinds of assets that financial institutions and wealthy people purchase — stocks, bonds, real estate, venture capital, and the like. This is why the price-to-earnings ratio of S&P 500 companies is at record highs, why risky start-ups with long-shot ideas are attracting $100 million venture rounds, and why the median home sales price has jumped 24% in a single year — the biggest one-year increase of the 21st century. Meanwhile, low- and middle-income earners are facing rising prices without attendant increases in their wages. If asset inflation persists while the costs of housing and health care continue to grow beyond the reach of ordinary people, the legitimacy of our market economy will be put on trial. THE RETURN OF SOUND MONEY Satoshi Nakamoto, the pseudonymous creator of Bitcoin, was acutely concerned with the increasing abundance of U.S. dollars and other fiat currencies in the early 2000s. In 2009 he wrote, "the root problem with conventional currency is all the trust that's required to make it work. The central bank must be trusted not to debase the currency, but the history of fiat currencies is full of breaches of that trust." Bitcoin was created in anticipation of the looming fiscal and monetary crisis in the United States and around the world. To understand how bitcoin functions alongside fiat currency, it's helpful to examine the monetary philosophy of the Austrian School of economics, whose leading figures — especially Hayek and Ludwig von Mises — greatly influenced Nakamoto and the early developers of Bitcoin. The economists of the Austrian School were staunch advocates of what Mises called "the principle of sound money" — that is, of keeping the supply of money as constant and predictable as possible. In The Theory of Money and Credit, first published in 1912, Mises argued that sound money serves as "an instrument for the protection of civil liberties against despotic inroads on the part of governments" that belongs "in the same class with political constitutions and bills of rights." Just as bills of rights were a "reaction against arbitrary rule and the nonobservance of old customs by kings," he wrote, "the postulate of sound money was first brought up as a response to the princely practice of debasing the coinage." Mises believed that inflation was just as much a violation of someone's property rights as arbitrarily taking away his land. After all, in both cases, the government acquires economic value at the expense of the citizen. Since monetary inflation creates a sugar high of short-term stimulus, politicians interested in re-election will always have an incentive to expand the money supply. But doing so comes at the expense of long-term declines in consumer purchasing power. For Mises, the best way to address such a threat is to avoid fiat currencies altogether. And in his estimation, the best sound-money alternative to fiat currency is gold. "The excellence of the gold standard," Mises wrote, is "that it renders the determination of the monetary unit's purchasing power independent of the policies of governments and political parties." In other words, gold's primary virtue is that its supply increases slowly and steadily, and cannot be manipulated by politicians. It may appear as if gold was an arbitrary choice as the basis for currency, but gold has a combination of qualities that make it ideal for storing and exchanging value. First, it is verifiably unforgeable. Gold is very dense, which means that counterfeit gold is easy to identify — one simply has to weigh it. Second, gold is divisible. Unlike, say, cattle, gold can be delivered in fractional units both small and large, enabling precise pricing. Third, gold is durable. Unlike commodities that rot or evaporate over time, gold can be stored for centuries without degradation. Fourth, gold is fungible: An ounce of gold in Asia is worth the same as an ounce of gold in Europe. These four qualities are shared by most modern currencies. Gold's fifth quality is more distinct, however, as well as more relevant to its role as an instrument of sound money: scarcity. While people have used beads, seashells, and other commodities as primitive forms of money, those items are fairly easy to acquire and introduce into circulation. While gold's supply does gradually increase as more is extracted from the ground, the rate of extraction relative to the total above-ground supply is low: At current rates, it would take approximately 66 years to double the amount of gold in circulation. In comparison, the supply of U.S. dollars has more than doubled over just the last decade. When the Austrian-influenced designers of bitcoin set out to create a more reliable currency, they tried to replicate all of these qualities. Like gold, bitcoin is divisible, unforgeable, divisible, durable, and fungible. But bitcoin also improves upon gold as a form of sound money in several important ways. First, bitcoin is rarer than gold. Though gold's supply increases slowly, it does increase. The global supply of bitcoin, by contrast, is fixed at 21 million and cannot be feasibly altered. Second, bitcoin is far more portable than gold. Transferring physical gold from one place to another is an onerous process, especially in large quantities. Bitcoin, on the other hand, can be transmitted in any quantity as quickly as an email. Third, bitcoin is more secure than gold. A single bitcoin address carried on a USB thumb drive could theoretically hold as much value as the U.S. Treasury holds in gold bars — without the need for costly militarized facilities like Fort Knox to keep it safe. In fact, if stored using best practices, the cost of securing bitcoin from hackers or assailants is far lower than the cost of securing gold. Fourth, bitcoin is a technology. This means that, as developers identify ways to augment its functionality without compromising its core attributes, they can gradually improve the currency over time. Fifth, and finally, bitcoin cannot be censored. This past year, the Chinese government shut down Hong Kong's pro-democracy Apple Daily newspaper not by censoring its content, but by ordering banks not to do business with the publication, thereby preventing Apple Daily from paying its suppliers or employees. Those who claim the same couldn't happen here need only look to the Obama administration's Operation Choke Point, a regulatory attempt to prevent banks from doing business with legitimate entities like gun manufacturers and payday lenders — firms the administration disfavored. In contrast, so long as the transmitting party has access to the internet, no entity can prevent a bitcoin transaction from taking place. This combination of fixed supply, portability, security, improvability, and censorship resistance epitomizes Nakamoto's breakthrough. Hayek, in The Denationalisation of Money, foresaw just such a separation of money and state. "I believe we can do much better than gold ever made possible," he wrote. "Governments cannot do better. Free doubt would." While Hayek and Nakamoto hoped private currencies would directly compete with the U.S. dollar and other fiat currencies, bitcoin does not have to replace everyday cash transactions to transform global finance. Few people may pay for their morning coffee with bitcoin, but it is also rare for people to purchase coffee with Treasury bonds or gold bars. Bitcoin is competing not with cash, but with these latter two assets, to become the world's premier long-term store of wealth. The primary problem bitcoin was invented to address — the devaluation of fiat currency through reckless spending and borrowing — is already upon us. If Biden's $3.5 trillion spending plan passes Congress, the national debt will rise further. Someone will have to buy the Treasury bonds to enable that spending. Yet as discussed above, investors are souring on Treasurys. On June 30, 2021, the interest rate for the benchmark 10-year Treasury bond was 1.45%. Even at the Federal Reserve's target inflation rate of 2%, under these conditions, Treasury-bond holders are guaranteed to lose money in inflation-adjusted terms. One critic of the Fed's policies, MicroStrategy CEO Michael Saylor, compares the value of today's Treasury bonds to a "melting ice cube." Last May, Ray Dalio, founder of Bridgewater Associates and a former bitcoin skeptic, said "[p]ersonally, I'd rather have bitcoin than a [Treasury] bond." If hedge funds, banks, and foreign governments continue to decelerate their Treasury purchases, even by a relatively small percentage, the decrease in demand could send U.S. bond prices plummeting. If that happens, the Fed will be faced with the two unpalatable options described earlier: allowing interest rates to rise, or further inflating the money supply. The political pressure to choose the latter would likely be irresistible. But doing so would decrease inflation-adjusted returns on Treasury bonds, driving more investors away from Treasurys and into superior stores of value, such as bitcoin. In turn, decreased market interest in Treasurys would force the Fed to purchase more such bonds to suppress interest rates. AMERICA'S BITCOIN OPPORTUNITY From an American perspective, it would be ideal for U.S. Treasury bonds to remain the world's preferred reserve asset for the foreseeable future. But the tens of trillions of dollars in debt that the United States has accumulated since 1971 — and the tens of trillions to come — has made that outcome unlikely. It is understandably difficult for most of us to imagine a monetary world aside from the one in which we've lived for generations. After all, the U.S. dollar has served as the world's leading reserve currency since 1919, when Britain was forced off the gold standard. There are only a handful of people living who might recall what the world was like before then. Nevertheless, change is coming. Over the next 10 to 20 years, as bitcoin's liquidity increases and the United States becomes less creditworthy, financial institutions and foreign governments alike may replace an increasing portion of their Treasury-bond holdings with bitcoin and other forms of sound money. With asset values reaching bubble proportions and no end to federal spending in sight, it's critical for the United States to begin planning for this possibility now. Unfortunately, the instinct of some federal policymakers will be to do what countries like Argentina have done in similar circumstances: impose capital controls that restrict the ability of Americans to exchange dollars for bitcoin in an attempt to prevent the digital currency from competing with Treasurys. Yet just as Nixon's 1971 closure of the gold window led to a rapid flight from the dollar, imposing restrictions on the exchange of bitcoin for dollars would confirm to the world that the United States no longer believes in the competitiveness of its currency, accelerating the flight from Treasury bonds and undermining America's ability to borrow. A bitcoin crackdown would also be a massive strategic mistake, given that Americans are positioned to benefit enormously from bitcoin-related ventures and decentralized finance more generally. Around 50 million Americans own bitcoin today, and it's likely that Americans and U.S. institutions own a plurality, if not the majority, of the bitcoin in circulation — a sum worth hundreds of billions of dollars. This is one area where China simply cannot compete with the United States, since Bitcoin's open financial architecture is fundamentally incompatible with Beijing's centralized, authoritarian model. In the absence of major entitlement reform, well-intentioned efforts to make Treasury bonds great again are likely doomed. Instead of restricting bitcoin in a desperate attempt to forestall the inevitable, federal policymakers would do well to embrace the role of bitcoin as a geopolitically neutral reserve asset; work to ensure that the United States continues to lead the world in accumulating bitcoin-based wealth, jobs, and innovations; and ensure that Americans can continue to use bitcoin to protect themselves against government-driven inflation. To begin such an initiative, federal regulators should make it easier to operate cryptocurrency-related ventures on American shores. As things stand, too many of these firms are based abroad and closed off to American investors simply because outdated U.S. regulatory agencies — the Securities and Exchange Commission (SEC), the Commodity Futures Trading Commission, the Treasury Department, and others — have been unwilling to provide clarity as to the legal standing of digital assets. For example, the SEC has barred Coinbase from paying its customers' interest on their holdings while refusing to specify which laws Coinbase has violated. Similarly, the agency has refused to approve Bitcoin exchange-traded funds (ETFs) without specifying standards for a valid ETF application. Congress should implement SEC Commissioner Hester Peirce's recommendations for a three-year regulatory grace period for decentralized digital tokens and assign to a new agency the role of regulating digital assets. Second, Congress should clarify poorly worded legislation tied to a recent bipartisan infrastructure bill that would drive many high-value crypto businesses, like bitcoin-mining operations, overseas. Third, the Treasury Department should consider replacing a fraction of its gold holdings — say, 10% — with bitcoin. This move would pose little risk to the department's overall balance sheet, send a positive signal to the innovative blockchain sector, and enable the United States to benefit from bitcoin's growth. If the value of bitcoin continues to appreciate strongly against gold and the U.S. dollar, such a move would help shore up the Treasury and decrease the need for monetary inflation. Finally, when it comes to digital versions of the U.S. dollar, policymakers should follow the advice of Friedrich Hayek, not Xi Jinping. In an effort to increase government control over its monetary system, China is preparing to unveil a blockchain-based digital yuan at the 2022 Beijing Winter Olympics. Jerome Powell and other Western central bankers have expressed envy for China's initiative and fret about being left behind. But Americans should strongly oppose the development of a central-bank digital currency (CBDC). Such a currency could wipe out local banks by making traditional savings and checking accounts obsolete. What's more, a CBDC-empowered Fed would accumulate a mountain of precise information about every consumer's financial transactions. Not only would this represent a grave threat to Americans' privacy and economic freedom, it would create a massive target for hackers and equip the government with the kind of censorship powers that would make Operation Choke Point look like child's play. Congress should ensure that the Federal Reserve never has the authority to issue a virtual currency. Instead, it should instruct regulators to integrate private-sector, dollar-pegged "stablecoins" — like Tether and USD Coin — into the framework we use for money-market funds and other cash-like instruments that are ubiquitous in the financial sector. PLANNING FOR THE WORST In the best-case scenario, the rise of bitcoin will motivate the United States to mend its fiscal ways. Much as Congress lowered corporate-tax rates in 2017 to reduce the incentive for U.S. companies to relocate abroad, bitcoin-driven monetary competition could push American policymakers to tackle the unsustainable growth of federal spending. While we can hope for such a scenario, we must plan for a world in which Congress continues to neglect its essential duty as a steward of Americans' wealth. The good news is that the American people are no longer destined to go down with the Fed's sinking ship. In 1971, when Washington debased the value of the dollar, Americans had no real recourse. Today, through bitcoin, they do. Bitcoin enables ordinary Americans to protect their savings from the federal government's mismanagement. It can improve the financial security of those most vulnerable to rising prices, such as hourly wage earners and retirees on fixed incomes. And it can increase the prosperity of younger Americans who will most acutely face the consequences of the country's runaway debt. Bitcoin represents an enormous strategic opportunity for Americans and the United States as a whole. With the right legal infrastructure, the currency and its underlying technology can become the next great driver of American growth. While the 21st-century monetary order will look very different from that of the 20th, bitcoin can help America maintain its economic leadership for decades to come. Tyler Durden Tue, 10/19/2021 - 23:25.....»»

Category: worldSource: nytOct 20th, 2021

RXR breaks ground for first South Bronx project

RXR Realty has broken ground for its inaugural South Bronx development, a future residential building located at 2413 Third Avenue. Situated next to the Third Avenue Bridge and minutes to the 6 train, the 27-story, 200-unit tower will designate 60 units as affordable apartments for middle income households. It will... The post RXR breaks ground for first South Bronx project appeared first on Real Estate Weekly. RXR Realty has broken ground for its inaugural South Bronx development, a future residential building located at 2413 Third Avenue. Situated next to the Third Avenue Bridge and minutes to the 6 train, the 27-story, 200-unit tower will designate 60 units as affordable apartments for middle income households. It will feature 81 on-site enclosed parking spaces and electric vehicle charging stations and 721 s/f of retail space. The project is slated for completion in 2023.  This summer, RXR and Bank of America closed on a $75.2 million construction loan to fund the development of 2413 Third Avenue. Rendering of the new tower “As the South Bronx continues to grow, it is crucial to see increased direct investment in affordable housing to support vibrant neighborhoods like Mott Haven. I am proud to celebrate the groundbreaking of over 60 affordable units for middle income households that will provide stability and opportunity for Bronx residents. I look forward to seeing continued investment in affordable housing in the South Bronx in order to lift up working families,” said Congressman Ritchie Torres, NY-15.  “We are thrilled to break ground today on our first entry into the Bronx market and celebrate the creation of 200 new apartments and retail space in the vibrant Mott Haven neighborhood. As the South Bronx’s population grows, RXR welcomes the opportunity to meet this demand and provide accessible, smartly designed and amenitized homes,” said Joanne Minieri, Senior Executive Vice President, Chief Operating Officer of Development and Construction, RXR Realty. “RXR is fully committed to working in partnership with the community to increase local hiring and activate the neighborhood through direct investment.” “We are excited to welcome RXR to the Bronx and to the thriving network of Chamber members who are investing in our neighborhoods to create new jobs and opportunities for community partnerships,” said Lisa Sorin, President of the Bronx Chamber of Commerce. Designed by CetraRuddy Architects, a the building will feature an open concept cafe and gallery space on the ground floor, a state-of-the-art fitness center, flexible common area, and electric vehicle charging stations. Units will be equipped with stainless steel appliances, white oak flooring, matte black iron fixtures and subway tiling. The 145,643 s/f development will also feature exterior amenity areas, including landscaped seating areas and lounges, rooftop grilling, dining areas and a gaming space. The tower is centrally located within walking distance of the 4/5/6 transit lines and one block from the Major Deegan Expressway.  “The building design is rooted in the traditions of the vibrant community of Mott Haven. A bold massing creates a sculpted presence that both engages the sky while opening up to pedestrian activity. Art is an integrated design element throughout the interior and exterior to enliven the street and the resident experience. Indoor/outdoor connectivity and integration with nature is an important element that helped form the project, creating gardens and varied outdoor spaces. Authenticity of materiality helps to create a welcoming structure that has the welcome of home,” said Nancy J. Ruddy and John Cetra of CetraRuddy Architecture. The post RXR breaks ground for first South Bronx project appeared first on Real Estate Weekly......»»

Category: realestateSource: realestateweeklyOct 13th, 2021

NYC"s likely next mayor wants to tackle the housing crisis. "We need to look at those sacred cows like SoHo."

Eric Adams, winner of the Democratic primary for mayor, says it's time for rich, exclusionary neighborhoods to add more homes for the poor. New York City Democratic Mayoral Candidate Eric Adams. TIMOTHY A. CLARY/AFP via Getty Images New York City's likely mayor wants to solve the housing crisis with denser buildings in rich neighborhoods. Eric Adams' strategy is a major change from decades of zoning for more housing in poorer areas. Upzoning in "sacred cows" like SoHo and other wealthy areas can even the playing field for homebuyers, he told Ezra Klein. See more stories on Insider's business page. New Yorkers in posh neighborhoods like SoHo may end up getting a lot more neighbors if Eric Adams has his way.After a slim victory in the Democratic primary during the spring, Adams is cruising toward becoming New York's second Black mayor ever and first since David Dinkins in the early '90s. The current Brooklyn borough president has carved out a reputation for being friendly to the real-estate industry, and he sounded very pro-development in a recent podcast appearance.Adams says he's offering a change from the policies that entrenched segregation and gentrification under his predecessors.For years, the city government's solution to skyhigh real-estate prices has been to upzone - construct denser residential buildings - in "affordable" areas, but it's clear now that the upzoning fix hasn't worked, Adams said in a recent appearance on Ezra Klein's New York Times podcast.Adams did not immediately respond to Insider's request for comment.Upzoning in poorer areas did little to actually improve those neighborhoods, while housing remained unattainable in much of the city. The neighborhoods that did improve as a result of upzoning saw poorer residents displaced, Adams said - a trend that's come to be known as gentrification.Instead of building affordable housing in poorer areas, the government should try to level the playing field and target the wealthiest neighborhoods, he added. "I say we need to look at the entire city," Adams said. "We need to look at those sacred cows like SoHo and other parts of the city where we used these methods to keep out groups. We must all share the affordable housing crisis."He said, for example, that upzoning should also apply to neighborhoods "from 34th Street down to 14th Street, from 9th Avenue over to Park Avenue," which would affect the affluent neighborhoods of Chelsea and Gramercy Park, as well as Union Square.Adams' plan hopes to improve more than just New York home affordability. The housing solution "must solve a multitude of problems," including access to schools and grocers, the Democratic candidate said. The lack of affordable housing is central to the city's inequality, and bringing affordable units to market can counter the unevenness that's emerged through the pandemic recovery, Adams said."We're going to integrate access to healthy food, to good transportation," he said. "We are extremely segregated as a city, and our housing plays a major role in that segregation."Upzoning in wealthy neighborhoods is just one part of Adams' housing plan. The likely mayor aims to repurpose government office buildings for affordable housing, as well as allow private offices and hotels to convert into residential buildings. A planned collection of regulatory changes could also create hundreds of thousands of affordable apartments by permitting basement units and single-room apartments, according to Adams' campaign website. Changes are afoot in housing policy beyond New York. Berkeley, California, voted earlier this year to ban single-family residential zoning and pave the way for duplexes on such lots. The Bay Area city introduced the restrictive zoning practice in 1916 but now serves as a first-mover in progressive zoning reform."Part of Berkeley's efforts is acknowledging that what happened was wrong and that we're learning from our past mistakes and we're trying to correct them," Berkeley Mayor Jesse Arreguín told Insider in September.California has since followed suit. Gov. Gavin Newsom signed a bill to eliminate single-family zoning in September, making it just the second state to ban the practice.Adams' extensive fundraising from the city's real-estate industry has been reported on by The City and The New York Times, and his mayorship may open more neighborhoods for development than New York has seen in decades. What will the neighbors think?Read the original article on Business Insider.....»»

Category: topSource: businessinsiderOct 6th, 2021

A former Beverly Hills mayor is so committed to keeping home prices high that he said the freedom to block dense housing deserves to be protected like gay marriage

John Mirisch said California is tolerant of "lifestyle choices" - like homosexuality - and argued single-family zoning deserves the same protection. Musician Ringo Starr and Beverly Hills Mayor John Mirisch speak at a public art dedication for Starr's donated sculpture "Peace and Love" at Beverly Gardens Park on November 02, 2019 in Beverly Hills. Michael Tullberg/Getty Images Choosing where to live is a "lifestyle choice," like choosing who to love, former Beverly Hills mayor John Mirisch said in a column. Mirisch made the comparison while arguing against pro-development housing activists. His passion on the issue sums up the housing market's tension between the conservative status quo and change. See more stories on Insider's business page. A war is being waged over US housing. Beverly Hills, California, is a key battleground, and one of the city's former mayors feels so strongly about protecting home values that he wrote a column comparing it to the freedom to "love whom you love."The column, by John Mirisch in CalMatters, underscores the wide gap between pro-housing advocates and those looking to protect home values. These groups have acquired the monikers YIMBYs and NIMBYs, as in "yes in my backyard" and their "not in my backyard" opponents. Preventing development in your backyard is good for home values, and for Mirisch, that's beyond a policy debate - it's a lifestyle choice."In California we pride ourselves on being very tolerant of a diverse array of lifestyles and lifestyle choices," wrote Mirisch, who remains a member of Beverly Hills' city council. "Dress how it suits you; love whom you love; define yourself in accordance with your own preferences."In a sign that NIMBYs are threatened by the direction of the debate, Mirisch sounds the alarm. "If living in a home with a garden is your thing, you probably shouldn't expect Californian tolerance from a certain group of people who with cult-like zeal will tell you that your lifestyle is bad, wrong, immoral and even 'racist.'"Mirisch is likely responding to the recent spate of victories by YIMBYs, who are largely millennial and Gen Z housing advocates. YIMBYs argue for denser apartment developments, more home construction, and widespread housing availability. The group successfully pushed Berkeley to reverse its century-old history of exclusionary zoning and, just weeks ago, was pivotal in California outlawing single-family zoning.Mirisch specifically decries how the YIMBY agenda is an "elimination of single-family neighborhoods," and said the activist group's ideals would strip Californians of an important lifestyle option.A handful of Mirisch's claims fall short. For one, homosexuality isn't a "lifestyle choice" that can be likened to music preferences or fashion. Also, YIMBYs argue for more housing density, including duplexes on single-family lots, not necessarily eradicating single-family neighborhoods.Mirisch also leaves unaddressed how single-family zoning has its roots in explicitly racist policy from the early 1900s. For example, a CNN investigation from February 2020 found a contemporary Beverly Hills deed that included language restricting occupancy by "any person other than of the white or Caucasian race."Beverly Hills is among the most expensive neighborhoods in the US, with median home prices nearing $4 million at the end of August, according to Zillow. The city is therefore one of the least likely to cave to pro-housing initiatives.Mirisch didn't immediately reply to a request for comment.Mirisch is not alone in his passion on housing issues. Over the last year, outrage over property prices has reached a fever pitch, as the dire housing shortage is keeping millions from climbing the socioeconomic ladder. Millennials are struggling to buy homes just as they hit peak homebuying age.In most cities, the shift to remote work during the pandemic and record-low mortgage rates kicked off a nationwide homebuying spree in 2020. That drove home inventory to all-time lows, and the market broke down as contractors were slow to bring more houses to market.Price growth is cooling on a monthly basis as the pandemic housing mania subsides, but the barrier to homeownership is now permanently higher.Other solutions exist for shaping a more inclusive housing market. Congress is pushing for a historic construction drive, hoping to solve the shortage with an onslaught of new homes.At least one other California mayor is on the side of the YIMBYs. Berkeley Mayor Jesse Arreguín, who once opposed denser zoning, is now among the most vocal pro-housing officials in the US. He told Insider in September that "single-family zoning was established on a foundation of racism in Berkeley and it's the basis upon which our zoning is built."Read the original article on Business Insider.....»»

Category: topSource: businessinsiderOct 5th, 2021

A majority in Berlin"s election just voted to strip 240,000 rentals from major landlords and fight the city"s housing crisis

About 56% of Berliners want the German capital to buy apartments from big landlords - a radical new idea for solving the global housing shortage. Protesters attend a demonstration against rent increase in Berlin, Germany, Saturday, April 6, 2019. Slogan in the foreground reads 'Stopp Deutsche Wohnen (housing company)' Michael Sohn/AP Photo About 56% of voters in Berlin, Germany, approved a measure for the city to buy apartments from major landlords. The rule would affect up to 240,000 apartments in Berlin and aims to cool the city's red-hot housing market. The move joins similar measures in other countries to curb skyrocketing home prices. See more stories on Insider's business page. In an unconventional David and Goliath story, pro-housing Berliners just dealt the city's biggest landlords a major blow.Roughly 56% of Berlin voters backed an initiative on Sunday that would force the city government to buy units owned by corporate landlords. The measure could lead the government to buy up to 240,000 apartments from the corporations. The rule targets landlords that own more than 3,000 rental units, meaning property giants like Deutsche Wohnen - which owns more than 100,000 units in Berlin alone - would be most affected.The outcome represents a progressive effort to cool one of Europe's hottest housing markets. Rent prices have surged 13% in the last 12 months, according to Berlin-based real estate firm Guthmann. Years of underbuilding now leave the city with an apartment shortage of 205,000 units, the firm said. With three-quarters of Berlin residents renting, the lack of sufficient housing supply has powered a stifling jump in rent prices.The referendum marks a shift from the free-market model and toward one that views affordable housing as a human right.Public ownership of units would offer more affordable housing options. The proposal's approval also shows Berliners are interested in more drastic steps to cool the market than denser zoning or more building on the city's outskirts.To be sure, the rule is non-binding, meaning the government doesn't have to act in accordance to the initiative. The Berlin government elected on Sunday will have the ultimate say on whether the rule goes into effect.The city's landlords don't expect the referendum to make enough of a difference. Government purchases of privately owned apartments "do not solve the manifold challenges on the Berlin housing market," Rolf Buch, CEO of property giant Vonovia, said in a statement to Reuters.The city's new leading party - the Social Democrats - is also skeptical. The referendum has to be respected, but it won't shore up more supply or fix the market, said the party's mayoral candidate Franziska Giffey, who is set to be Berlin's first female mayor, according to the same election's provisional results.Berlin's housing problems are globalThe Berlin referendum echoes efforts in other countries to boost housing affordability.In the US, lawmakers are pushing forward with legislation that, among many other things, aims to increase home supply. Democrats' $3.5 trillion spending proposal includes $213 billion in funding that's estimated to create 2 million new homes.Separately, President Joe Biden announced in September a series of regulatory changes that seek to build 100,000 new homes and promote denser residential zoning.On the state level, California Gov. Gavin Newsom approved a law on September 16 that outlaws single-family home zoning in the state, clearing the way for the building of duplexes on any single-family lots. The progressive measure immediately allows for the creation of 700,0000 more homes in existing neighborhoods. By comparison, California typically permits 100,000 new homes each year. By banning single-family zoning, the state reversed a century-old status quo that protected property values instead of providing denser and more affordable housing. In Canada, Prime Minister Justin Trudeau proposed a housing plan in September that would end "blind bidding," a process through which prospective buyers can't see what other buyers have offered for a home. Trudeau also plans to ban the buying of Canadian homes for investment purposes, saying Canadians "shouldn't lose a bidding war on your home to speculators." Investor interest has driven home prices higher and exacerbated shortages in housing markets across the world, including the US, Canada, and New Zealand.Read the original article on Business Insider.....»»

Category: topSource: businessinsiderSep 27th, 2021

Multifamily Activity Bolsters Housing Starts, but Single-Family Production Low

Strong multifamily activity pushed overall housing starts up in August but single-family starts have dipped in response to continued supply chain and labor challenges. Total starts increased 3.9% to a seasonally adjusted annual rate of 1.62 million units, according to the latest data from the U.S. Department of Housing and Urban Development and the U.S. […] The post Multifamily Activity Bolsters Housing Starts, but Single-Family Production Low appeared first on RISMedia. Strong multifamily activity pushed overall housing starts up in August but single-family starts have dipped in response to continued supply chain and labor challenges. Total starts increased 3.9% to a seasonally adjusted annual rate of 1.62 million units, according to the latest data from the U.S. Department of Housing and Urban Development and the U.S. Census Bureau. The August reading of 1.62 million starts is the number of housing units builders would begin if development kept this pace for the next 12 months. Within this overall number, single-family starts decreased 2.8% to a 1.08 million seasonally adjusted annual rate, but are up 23.8% year-to-date. The multifamily sector increased 20.6% to a 539,000 pace. The breakdown: Housing Starts: 1.62 million (+3.9%% month-over-month, +17.4% year-over-year) Multifamily Starts: 530,000 Single-Family Starts: 1,054,000 Building Permits: 1.73 million (+6.0% month-over-month, +13.5% year-over-year) Multifamily Permits: 632,000 Single-Family Permits: 1,048,000 Completions: 1.33 million (-4.5% month-over-month, +9.4% year-over-year) Multifamily Completions: 356,000 Single-Family Completions: 971,000 Regional year-to-date data: Midwest: +14% South: +20.2% West:  +23.9% Northeast: +35.96% What the industry is saying: “Total housing starts and housing permits made decent gains in August compared to the month prior, but the focus was on multifamily units. Single-family housing starts fell 2.8% while single-family housing permits, a gauge for future activity, were essentially unchanged after falling in the past four months. Multifamily starts, comprising mostly apartments, increased by 20.6% while multifamily permits rose 15.8%. “There is certainly a housing shortage, as reflected in the low inventory of homes for sale and in low rental vacancy rates. However, a shift toward rental buildings means less access to homeownership over the long run and the accompanying opportunity for wealth gains. Home-price gains will surely moderate after experiencing gains of nearly 20% in the first half of this year. But given the housing shortage and the lack of big increases in the construction of single-family homes, home prices will continue to move higher than most people’s income gains. That’s good news for property owners, but bad news for those wanting to become homeowners.” — Dr. Lawrence Yun, Chief Economist, National Association of REALTORS® “Single-family construction is normalizing at more sustainable levels after an increase in building material pricing. Demand remains strong, but the market is facing increasing housing affordability issues after a run-up in new and existing home prices. Multifamily construction increased in August, with NAHB expecting a solid gain for apartment construction in 2021 after a slight decline last year.” — Chuck Fowke, Chairman, National Association of Home Builders “More inventory is coming for a market that continues to face a housing deficit. The number of single-family homes under construction in August-702,000-is the highest since the Great Recession and is 32.7% higher than a year ago. While some building materials, like lumber, have seen easing prices, delivery delays and a lack of skilled labor and building lots continue to hold the market back.” — Robert Dietz, Chief Economist, National Association of Home Builders “The pace of new construction reflected homebuilder shifts toward higher margin projects amid fluctuating costs. As August saw home builder sentiment dip over concerns of slipping buyer traffic and sales, builders sought permits for more multifamily projects. However, this week’s September sentiment numbers show a rebound is in the works, as residential construction companies work through their order backlog and look forward to increased traffic heading into 2022. Real estate markets are grappling with a decade of underbuilding, which has pushed this year’s buyers to pay record-high prices for a tight number of homes for sale. As millennials—the largest generation in our country’s history—came of age during the last 10 years, new construction volume lagged, creating a shortage of 5.2 million new homes. Moreover, completed new homes have been mostly aimed at the premium segment of the market, with the share of new-home sales priced at or below $300,000 dropping from 43% of total in 2018, to 32% in the first half of 2021. “For builders, demographics offer tremendous potential, as the millennial generation is in its peak household formation years. In a promising recent development for builders and buyers alike, California’s recent legislative move to expand access to more homes through relaxing single-family zoning standards could serve as a model for other states and open the door for an influx of affordable new construction supply.” — George Ratiu, Manager of Economic Research,® “New-home starts recovered in August, following a brief period of decline in July due to supply chain issues. Additionally, the backlog of homes authorized but not started has grown to record levels over the late spring and summer, and as builders are able to secure materials and labor it is not surprising to see starts begin to pick back up. This backlog is a promising metric, and while some of the pipeline of units may be canceled, it is likely that a good share of the backlog will make it to market due to robust housing demand.” — Kelly Mangold, Principal, RCLCO Real Estate Consulting The post Multifamily Activity Bolsters Housing Starts, but Single-Family Production Low appeared first on RISMedia......»»

Category: realestateSource: rismediaSep 21st, 2021

Star Equity Holdings, Inc. Announces 2022 First Quarter Financial Results

Reported a 51.5% increase in Q1 2022 consolidated gross profit on a 12.1% increase in consolidated revenues Construction division reported a 191.5% increase in gross profit on a 28.6% increase in revenue Ended Q1 2022 with $15.0 million in cash and cash equivalents OLD GREENWICH, Conn., May 23, 2022 (GLOBE NEWSWIRE) -- Star Equity Holdings, Inc. (NASDAQ:STRR, STRRP)) ("Star Equity" or the "Company"), a diversified holding company, reported today its financial results for the first quarter (Q1) ended March 31, 2022. On January 24, 2022, the Company closed an underwritten public offering (the "January Offering") of 9.5 million shares of the Company's common stock and warrants to purchase up to 9.5 million shares of its common stock. Gross proceeds, before deducting underwriting discounts and offering expenses, were approximately $14.3 million and net proceeds were $12.7 million. Following the sale of a portion of our Healthcare business in early 2021, all financial results for the 2022 and 2021 reporting periods, unless stated otherwise, relate to continuing operations, which include the Healthcare, Construction, and Investments divisions. Q1 2022 Financial Highlights vs. Q1 2021 (unaudited) Consolidated revenues increased by 12.1% to $25.0 million from $22.4 million. Gross profit increased by 51.5% to $4.7 million from $3.1 million. Net loss from continuing operations was $3.7 million (or $0.29 per basic and diluted share) compared to a net loss from continuing operations of $0.6 million (or $0.12 per basic and diluted share). Non-GAAP adjusted net loss from continuing operations was $0.7 million (or $0.05 per basic and diluted share) compared to a loss of $1.7 million (or $0.35 per basic and diluted share). Non-GAAP adjusted EBITDA from continuing operations increased to a gain of $0.1 million from a loss of $0.9 million. As of March 31, 2022, cash and cash equivalents increased to $15.0 million from $13.2 million; net debt, defined as total debt less total cash and cash equivalents, decreased to ($1.7 million) from $3.6 million. Jeff Eberwein, Executive Chairman, noted, "In the first quarter 2022 we reported improved financial and operational performance with a 12.1% increase in revenues and an improvement in margins. Our Healthcare division grew revenue by 0.8% versus the prior year quarter and gross margin improved by four percentage points to 23.7%. Our Construction division grew revenue by 28.6% due to large commercial projects at EBGL and pricing increases that we implemented to mitigate the impact of higher raw materials costs, while gross margin substantially improved due to increased pricing, improved operations, and commodity price risk mitigation. We continue to make progress toward our goal of achieving and maintaining a gross margin over 20% for our Construction division." Mr. Eberwein continued, "With the completion of the January Offering for gross proceeds of $14.3 million, we are now well-positioned to fund high-return internal growth investments and pursue acquisitions, which could be either bolt-ons for our Healthcare or Construction divisions or entry into a new business sector." Revenues The Company's consolidated Q1 2022 revenues increased 12.1% to $25.0 million from $22.4 million in the first quarter of the prior year. Revenues in $ thousands   Q1 2022   Q1 2021   % change Healthcare   $ 13,418     $ 13,307     0.8 % Construction     11,631       9,047     28.6 % Investments     158       158     — % Intersegment elimination     (158 )     (158 )   — % Total Revenues   $ 25,049     $ 22,354     12.1 % Healthcare Q1 2022 revenues increased 0.8% versus the prior year period predominately driven by an increase in revenue from radiopharmaceuticals contracts, as our business continues to recover from the COVID-19 pandemic. Construction Q1 2022 revenues increased 28.6% to $11.6 million from $9.0 million versus the prior year period. The increase in revenues for the Construction division was due to large commercial projects for EBGL business offset by a $0.6 million decrease in revenues for KBS business. Construction division revenues accounted for 46.4% of Star Equity's consolidated revenues in Q1 2022. Construction's backlog and sales pipeline remain at record levels due to newly signed contracts. Gross Profit Gross profit (loss) in $ thousands   Q1 2022   Q1 2021   % change Healthcare   $ 3,176     $ 2,598     22.2 % Healthcare gross margin     23.7 %     19.5 %   4.2 % Construction     1,586       544     191.5 % Construction gross margin     13.6 %     6.0 %   7.6 % Investments     59       93     (36.6 )% Investments gross margin     37.3 %     58.9 %   (21.6 )% Intersegment elimination     (158 )     (158 )   — % Total gross profit   $ 4,663     $ 3,077     51.5 % Total gross margin     18.6 %     13.8 %   4.8 % Healthcare Q1 2022 gross profit increased 22.2% versus the prior year period, mainly due to the increased percentage of high margin large radiopharmaceuticals contracts. Construction Q1 2022 gross profit increased 191.5% from the prior year period, due to an increase in revenue during the period and significantly increased pricing levels. Since mid-2021 we have been implementing higher prices to offset higher input costs in both residential and commercial projects. Operating Expenses On a consolidated basis, Q1 2022 sales, general and administrative ("SG&A") expenses increased by $1.7 million, or 34.3%, versus the prior year period. Most of the increase in SG&A was associated with increased headcount, outside services, and one-time litigation costs. SG&A as a percentage of revenue increased in Q1 2022 to 27.1% versus 22.6% in Q1 2021. Net Income Q1 2022 net loss from continuing operations was $3.7 million, or $0.29 per basic and diluted share, compared to net loss of $0.6 million, or $0.12 per basic and diluted share, in the same period in the prior year. Q1 2022 non-GAAP adjusted net loss from continuing operations was $0.7 million, or $0.05 per basic and diluted share, compared to adjusted net loss from continuing operations of $1.7 million, or $0.35 per basic and diluted share, in the prior year period. Non-GAAP Adjusted EBITDA Q1 2022 non-GAAP adjusted EBITDA from continuing operations increased to a gain of $0.1 million from a loss of $0.9 million in the same quarter of the prior year due to improvements in the Company's operations leading to increased gross profit at the Company's Healthcare and Construction divisions. Operating Cash Flow Q1 2022 cash flow from operations was an outflow of $0.6 million, compared to an outflow of $2.2 million for the same period in the prior year. The decrease in outflows was due to improvements in the Company's operations leading to increased gross profit at both the Healthcare and Construction divisions. Preferred Stock Dividends In Q1 2022, the Company's board of directors declared a cash dividend to holders of our Series A Preferred Stock of $0.25 per share, for an aggregate amount of approximately $0.5 million. The record date for this dividend was March 1, 2022, and the payment date was March 10, 2022. As of March 31, 2022, we have no preferred dividends in arrears. Subsequently on May 19, 2022, the Company's board of directors declared a cash dividend to holders of our Series A Preferred Stock of $0.25 per share, for an aggregate amount of approximately $0.5 million. The record date for this dividend was June 1, 2022, and the payment date was June 10, 2022. In addition, the Company intends to submit to the vote of stockholders at its 2022 Annual Meeting a proposal to amend the Certificate of Designation of the Series A Preferred Stock. This amendment, if approved by the majority of the holders of both the Series A Preferred Stock (voting as a separate class) and common stock, would amend the definition of a "change of control triggering event" to "the acquisition of more than 50% of the total voting stock of the Company." The proposal would also amend the terms of the Series A Preferred Stock such that only the Company, rather than the holders of the Series A Preferred Stock, has the right of redemption in the event of a change of control. Conference Call Information A conference call is scheduled for today, May 23, 2022, at 10:00 a.m. ET (7:00 a.m. PT) to discuss the results and management's outlook. The call may be accessed by dialing 1-877-407-9039 (international callers: +1-201-689-8470) five minutes prior to the scheduled start time and referencing Star Equity. A simultaneous webcast of the call may be accessed online from the Events & Presentations link on the Investor Relations page at; an archived replay of the webcast will be available within 15 minutes of the end of the conference call. If you have any questions, either prior to or after our scheduled Earnings Conference call, please e-mail or Use of Non-GAAP Financial Measures by Star Equity Holdings, Inc. This release presents the non-GAAP financial measures "adjusted net income (loss)," "adjusted net income (loss) per basic and diluted share," "adjusted cash earnings per share", and "adjusted EBITDA from continuing operations." The most directly comparable measure for these non-GAAP financial measures are "net income and basic and diluted net income per share," and "cash flows from operating activities." The Company has included below unaudited adjusted financial information, which presents the Company's results of operations after excluding acquired intangible asset amortization, one time transaction costs, financing costs, gain or loss from loan forgiveness, litigation costs, COVID-19 protection equipment, unrealized gain (loss) on derivatives, non-recurring gain on disposals, and income tax adjustments. Further excluded in the measure of adjusted EBITDA are stock-based compensation, interest, taxes, depreciation, and amortization. A discussion of the reasons why management believes that the presentation of non-GAAP financial measures provides useful information to investors regarding the Company's financial condition and results of operations is included as Exhibit 99.2 to the Company's report on Form 8-K filed with the Securities and Exchange Commission on May 23, 2022. About Star Equity Holdings, Inc. Star Equity Holdings, Inc. is a diversified holding company with three divisions: Healthcare, Construction, and Investments. Healthcare Our Healthcare division designs, manufactures, and distributes diagnostic medical imaging products and provides mobile imaging services. Our Healthcare division operates in two businesses: (i) diagnostic services and (ii) diagnostic imaging. The diagnostic services business offers imaging services to healthcare providers as an outsourced alternative to purchasing and operating their own equipment. The diagnostic imaging business develops, sells, and maintains solid-state gamma cameras. Construction Our Construction division manufactures modular housing units for commercial and residential real estate projects and operates in two businesses: (i) modular building manufacturing and (ii) structural wall panel and wood foundation manufacturing, including building supply distribution operations for professional builders. Investments Our Investments division manages and finances the Company's real estate assets and investments.Forward-Looking Statements "Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements in this release that are not statements of historical fact are hereby identified as "forward-looking statements" for the purpose of the safe harbor provided by Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking Statements include, without limitation, statements regarding (i) the plans and objectives of management for future operations, including plans or objectives relating to acquisitions and related integration, development of commercially viable products, novel technologies, and modern applicable services, (ii) projections of income (including income/loss), EBITDA, earnings (including earnings/loss) per share, capital expenditures, cost reductions, capital structure or other financial items, (iii) the future financial performance of the Company or acquisition targets and (iv) the assumptions underlying or relating to any statement described above. Moreover, forward-looking statements necessarily involve assumptions on the Company's part. These forward-looking statements generally are identified by the words "believe", "expect", "anticipate", "estimate", "project", "intend", "plan", "should", "may", "will", "would", "will be", "will continue" or similar expressions. Such forward-looking statements are not meant to predict or guarantee actual results, performance, events or circumstances and may not be realized because they are based upon the Company's current projections, plans, objectives, beliefs, expectations, estimates and assumptions and are subject to a number of risks and uncertainties and other influences, many of which the Company has no control over. Actual results and the timing of certain events and circumstances may differ materially from those described above as a result of these risks and uncertainties. Factors that may influence or contribute to the inaccuracy of forward-looking statements or cause actual results to differ materially from expected or desired results may include, without limitation, the substantial amount of debt of the Company and the Company's ability to repay or refinance it or incur additional debt in the future; the Company's need for a significant amount of cash to service and repay the debt and to pay dividends on the Company's preferred stock; the restrictions contained in the debt agreements that limit the discretion of management in operating the business; legal, regulatory, political and economic risks in markets and public health crises that reduce economic activity and cause restrictions on operations (including the recent coronavirus COVID-19 outbreak); the length of time associated with servicing customers; losses of significant contracts or failure to get potential contracts being discussed; disruptions in the relationship with third party vendors; accounts receivable turnover; insufficient cash flows and resulting lack of liquidity; the Company's inability to expand the Company's business; unfavorable changes in the extensive governmental legislation and regulations governing healthcare providers and the provision of healthcare services and the competitive impact of such changes (including unfavorable changes to reimbursement policies); high costs of regulatory compliance; the liability and compliance costs regarding environmental regulations; the underlying condition of the technology support industry; the lack of product diversification; development and introduction of new technologies and intense competition in the healthcare industry; existing or increased competition; risks to the price and volatility of the Company's common stock and preferred stock; stock volatility and in liquidity; risks to preferred stockholders of not receiving dividends and risks to the Company's ability to pursue growth opportunities if the Company continues to pay dividends according to the terms of the Company's preferred stock; the Company's ability to execute on its business strategy (including any cost reduction plans); the Company's failure to realize expected benefits of restructuring and cost-cutting actions; the Company's ability to preserve and monetize its net operating losses; risks associated with the Company's possible pursuit of acquisitions; the Company's ability to consummate successful acquisitions and execute related integration, as well as factors related to the Company's business including economic and financial market conditions generally and economic conditions in the Company's markets; failure to keep pace with evolving technologies and difficulties integrating technologies; system failures; losses of key management personnel and the inability to attract and retain highly qualified management and personnel in the future; and the continued demand for and market acceptance of the Company's services. For a detailed discussion of cautionary statements and risks that may affect the Company's future results of operations and financial results, please refer to the Company's filings with the Securities and Exchange Commission, including, but not limited to, the risk factors in the Company's most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. This release reflects management's views as of the date presented. All forward-looking statements are necessarily only estimates of future results, and there can be no assurance that actual results will not differ materially from expectations, and, therefore, you are cautioned not to place undue reliance on such statements. Further, any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events. For more information contact:   Star Equity Holdings, Inc. The Equity Group Jeffrey E. Eberwein Lena Cati Executive Chairman Senior Vice President 203-489-9501 212-836-9611 (Financial tables follow) Star Equity Holdings, Inc.Condensed Consolidated Statements of Operations(Unaudited) (In thousands, except for per share amounts)     Three Months Ended March 31,       2022       2021   Revenues:         Healthcare   $ 13,418     $ 13,307   Construction     11,631       9,047   Total revenues     25,049       22,354             Cost of revenues:         Healthcare     10,242       10,709   Construction     10,045       8,503   Investments     99       65   Total cost of revenues     20,386       19,277             Gross profit     4,663       3,077             Operating expenses:         Selling, general and administrative     6,788       5,055   Amortization of intangible assets     430       438   Gain on sale of MD Office Solutions     —       (847 ) Total operating expenses     7,218       4,646             Loss from operations     (2,555 )     (1,569 )           Other income (expense):         Other (expense) income, net     (6 )     35   Interest expense, net     (190 )     (272 ) Gain on forgiveness of PPP loans     —       1,220   Total other (expense) income     (196 )     983             Loss from continuing operations before income taxes     (2,751 )     (586 ) Income tax provision     (950 )     (2 ) Loss from continuing operations, net of tax     (3,701 )     (588 ) Income from discontinued operations, net of tax     —       6,020   Net (loss) income     (3,701 )     5,432   Deemed dividend on Series A perpetual preferred stock     (479 )     (479 ) Net (loss) income attributable to common shareholders   $ (4,180 )   $ 4,953             Net income (loss) per share—basic and diluted         Net loss per share, continuing operations   $ (0.29 )   $ (0.12 ) Net income per share, discontinued operations   $ —     $.....»»

Category: earningsSource: benzinga9 hr. 21 min. ago

The Navy is tasking "combat-ready" SEALs to develop new ways to take on "the most stressing hard targets"

Allowing "combat-ready forces" to work new tactics and techniques is helping solve "key operational problems" the top SEAL officer wrote recently. A US Naval Special Warfare combatant-craft crewman mans an M2 machine gun during an exercise near Bay St. Louis, Mississippi, April 25, 2022.US Army National Guard/Staff Sgt. Connie Jones US special operators are adjusting to new roles as the military shifts to great-power competition. For Naval Special Warfare Command, that means updating its tactics, techniques, and procedures. Some combat-ready SEALs are now working to solve "key operational problems," the top SEAL officer wrote recently. The US Navy SEALs are developing new ways to remain relevant and prepare for near-peer warfare against China or Russia.After two decades of counterterrorism and counterinsurgency operations in the Middle East, Africa, and Southeast Asia, US Naval Special Warfare Command is going back to the drawing board to come up with new or updated tactics, techniques, and procedures to take on the most difficult targets.Naval Special Warfare Command in is the naval component of US Special Operations Command and is composed of Navy SEALs and Navy Special Warfare Combatant-Craft crews.A US Naval Special Warfare Task Unit Europe member does VBSS training with a Cypriot Underwater Demolition Team, in Cyprus, September 9, 2021.US Army/Sgt. Patrik OrcuttThe SEAL component of Naval Special Warfare is composed of 10 "regular" SEAL Teams — eight active duty and two reserve — two SEAL Delivery Vehicle Teams, which operate stealthy mini-submarines, and two Special Reconnaissance Teams.The Naval Special Warfare Development Group — formerly known as SEAL Team 6 — operationally falls under the secretive Joint Special Operations Command.The SWCC component is composed of three Special Boat Teams that specialize in maritime direct action, maritime special reconnaissance, inserting and extracting other special-operations forces, and Visit, Board, Search, and Seizure operations.Rear Adm. Hugh W. Howard III, commanding officer of Naval Special Warfare Command, described how his Navy SEAL Teams and Special Boat Teams carrying out this shift in a recent article for the US Naval Institute's Proceedings magazine.Developing new conceptsRear Adm. H.W. Howard III at the US Naval Academy in Annapolis, Maryland, January 28, 2022.US Navy/Stacy GodfreyTypically, all available Naval Special Warfare combat-ready units are deployed overseas.However, the head of Special Operations Command, Army Gen. Richard Clarke, recently decided to hold about one-third of combat-ready Navy SEAL platoons and SWCC boat detachments in reserve for "experimentation, concept development, and high-return deploy-for-purpose (DfP) missions," Howard wrote.The reserve elements in deploy-for-purpose status "increase our agility to respond to crises around the globe and — perhaps most critical — provide combat-ready forces to experiment and generate new concepts at lower training risk after they have mastered core mission-essential tasks," the top SEAL officer wrote."Allowing combat-ready forces to experiment with new tactics, techniques, and procedures for the most stressing hard targets and environmental conditions is helping answer the Navy's and joint force's key operational problems," Howard added.Like the rest of SOCOM, Naval Special Warfare Command has continued some missions related to counterterrorism and countering violent extremist groups, but it is shifting more attention and resources great-power competition and to countering the critical systems and capabilities of China and Russia, such as their command-and-control systems and their ability to find and track rival forces.US Air Force Special Tactics operators and US Navy Special Warfare operators perform joint dive training at Souda Bay, Greece, May 25, 2021.US Air Force/Army Staff Sgt. Brandon NelsonReflecting that shift, Navy SEALs and SWCC operators have worked more with the conventional forces of "Big Navy," especially with aircraft carriers, training to help those forces survive and be more effective in combat."We are learning how to integrate our capabilities to complement the F-35 Lightning II, littoral combat ships, Zumwalt-class destroyers, Military Sealift Command assets, and Navy unmanned vehicles," Howard wrote.Naval Special Warfare and "Big Navy" are also working together to test new concepts, technologies, and tactics to enhance the Navy's manned and unmanned capabilities. In a recent testimony to Congress, Howard emphasized Naval Special Warfare's commitment to a closer relationship with its parent branch.Naval Special Warfare's closer integration with "Big Navy" promotes technological and conceptual advancements, including in "maritime reconnaissance and scouting; strike, mine, undersea, and seabed warfare; strategic sabotage against critical infrastructure; and deception," Howard wrote.In addition, Naval Special Warfare is cooperating with the Navy's submarine force to hone its underwater special-operations capabilities. Howard highlighted a training event between Navy SEALs and a Virginia-class nuclear fast-attack submarine in the eastern Mediterranean last year.Naval Special Warfare Command divers train with Virginia-class fast-attack submarine USS North Carolina off of Oahu, June 18, 2021.US Navy/MCS2 Alex PerlmanHoward wrote that Naval Special Warfare has enjoyed "a special relationship with the submarine force" for decades and that the command's clandestine capabilities coupled with advanced stealthy submarines "create an unrivaled asymmetric advantage."The US military's first sub-launched commando raid was carried out during World War II, and in the decades since the SEALs were formed in 1962, SEAL Vehicle Delivery teams and their unique mini-subs have often been paired with US submarines to get SEALs closer to targets and carry out underwater operations.That first sub-launched raid was carried out by Marine Raiders, the Marine Corps' special-operations force. Now, Howard wrote, SEAL and Special Boat teams are "partnering with the Marine Corps on complementary concepts, expeditionary sustainment, and staging for inside force operations in contested battlespace."The changes and initiatives underway reflect the US military's growing concern about a new environment of competition and potentially conflict with capable adversaries that are able to challenge it at every level — something the US hasn't faced for much of the past 30 years.Leaders are responsible for understanding their organizations' strengths and weaknesses and the changes in the landscape around them "and then boldly, fearlessly lead their organizations to adapt," Howard wrote.Stavros Atlamazoglou is a defense journalist specializing in special operations, a Hellenic Army veteran (national service with the 575th Marine Battalion and Army HQ), and a Johns Hopkins University graduate.Read the original article on Business Insider.....»»

Category: topSource: businessinsider22 hr. 39 min. ago

National Rents Hit Their 14th Straight Month of Record-Highs

The U.S. median rental price hit a new high—$1,827—for the 14th month in a row, according to the latest Monthly Rental Report from® released this week. And higher rents are increasingly cutting into households’ budgets for regular expenses and savings, according the portal’s Avail Quarterly Landlord and Renter Survey, also released this week, which… The post National Rents Hit Their 14th Straight Month of Record-Highs appeared first on RISMedia. The U.S. median rental price hit a new high—$1,827—for the 14th month in a row, according to the latest Monthly Rental Report from® released this week. And higher rents are increasingly cutting into households’ budgets for regular expenses and savings, according the portal’s Avail Quarterly Landlord and Renter Survey, also released this week, which further puts a spotlight on the affordability struggles reported by renters. “April data illustrates the perfect storm of supply and demand dynamics behind the continued rent surge, from a low number of available rentals to higher for-sale housing costs forcing many would-be buyers to rent for longer than planned,” said® Chief Economist Danielle Hale. “Renters are being left with few options but to meet higher rents and, in some cases, even offer above asking—whether they can afford to or not. “Avail’s new survey shows rents are not only maxing out renters’ housing budgets but are the biggest strain on their overall finances, even as inflation drives up expenses across the board. For renters trying to stay on budget, making a list of must-have features is key. This will be especially important as, if recent trends continue, we expect the typical U.S. asking rent to eclipse $2,000 by August.” April 2022 Rental Metrics – National Unit Size Median Rent Change over April 2021 Change over April 2020 Overall $1,827 16.7% 21.0% Studio $1,500 17.2% 15.2% 1-bed $1,679 15.7% 19.9% 2-bed $2,062 16.0% 23.8% April rents maintain record-breaking run, despite annual growth cooling slightly®’s April data showed national rents maintained their record-breaking run that began in January 2021, despite posting a slightly smaller year-over-year gain than in March, according to the report. The continued rent surge is attributed to the mismatch between rental supply and rising demand, largely from would-be homebuyers. Some of these aspiring homeowners are staying in the rental market for longer than they may have intended, due to intensifying cost pressures driven by both the longstanding housing supply shortage and more recent inflationary economy. If these trends continue, national asking rents will likely surpass 2022’s forecasted year-over-year growth projections (+7.1%) by end of year. Additional key findings: The U.S. median rental price hit a new high of $1,827 in April, while the annual growth rate (+16.7%) moderated slightly from the March pace (+17.0%). Still, rents continued to rise at a double-digit annual pace, reaching 21.0% higher than in April 2020 right after the onset of COVID. Studio rents grew at a faster year-over-year pace (+17.2%) than one-bedrooms (+15.6%) and two-bedrooms (+15.9%). This is largely due to the ongoing rental market comeback in major downtowns where smaller living spaces are common, with studio rents up double-digits over April 2021 in all 10 of the biggest tech hubs, led by: New York City (29.1%), Boston (+27.4%) and Austin, Texas (+25.0%). In a potential reflection of shifting migration patterns during the pandemic, the five large markets that posted April’s biggest overall rental price gains year-over-year were in the Sun Belt: Miami (+51.6%), Orlando, Fla. (32.9%), Tampa, Fla. (27.8%), San Diego (25.6%) and Las Vegas (24.8%). Avail survey finds renters are struggling to keep up with rising costs  With rental demand on the rise, landlords with limited available units are able to adjust asking rents on both new and renewing leases to reflect the increasingly competitive market. In fact, the majority of landlords surveyed by®’s Avail reported plans to increase rental prices within the next 12 months. This could mean further rental affordability challenges, with many surveyed renters already feeling the squeeze on their finances and savings, as inflation drives up the cost of everything from rent to regular household expenses. Among renters surveyed in April, 66.1% said higher rents and related household costs are their top cause of financial strain—ahead of other expenses like food and groceries (57.3%) and auto and transportation (50.8%). Higher rents are also limiting renters’ ability to save, with more than three-quarters of renters (76.1%) saving less each month than at the same time last year. The typical household surveyed reported being able to save just $50 each month. Of respondents whose rents have gone up on their current unit, 72.9% are considering a move to a more affordable rental. However, lower-cost options are dwindling, with renters who moved in the past year typically paying higher rents ($350) than they did previously. Those who are staying put are trying to cut costs, most commonly on entertainment (67.1%) and food and groceries (62.3%). Additionally, trends among surveyed landlords indicate that renters aren’t likely to see relief any time soon. Nearly three-quarters of landlords (72.1%) plan to raise the rent of at least one property this year, up from 65.1% in the January survey. “Our survey data underscores how renters and landlords alike are feeling the squeeze of inflation and higher costs. For renters in particular, many may understandably feel caught between a rock and a hard place, but remember that there are resources that can help. Doing your research can go a long way in helping you prepare to navigate rent increases and their impact on your family’s finances,” said Ryan Coon, Avail co-founder and VP of Rentals at®. Renters grappling with higher costs can access free financial counseling through the Renter Advantage program, a collaboration between®’s Avail, the National Foundation for Credit Counseling, the Housing Partnership Network, and Wells Fargo. Learn more here. The post National Rents Hit Their 14th Straight Month of Record-Highs appeared first on RISMedia......»»

Category: realestateSource: rismediaMay 20th, 2022

2 reasons the US is in a major housing shortage, construction can"t get done, and houses cost more than many Americans can afford

Spikes in material costs have added $18,500 to the price of an average new single-family home. Plus, the industry is struggling to hire. Construction worker observing a house.Getty Images The US has a severe housing shortage – which means the ones that are available aren't affordable. There are two reasons the US hasn't built enough homes to meet the demand. Materials delays make scheduling projects inconsistent, which makes it hard to retain workers. The US is in the middle of a severe housing shortage – and it's making it even harder for Americans to afford homes.It doesn't look like conditions are improving.According to the Census Bureau, building permits for new residential construction dropped to a five-month low in April. Much of that decline was in single family homes, meanwhile spring homebuyer demand helped push home prices up 15.5% year over year to a median selling price of $424,405. "Builders still have a backlog of uncompleted homes to get through before they can break ground on new projects," Odeta Kushi, First American deputy chief economist, told Insider, pointing out that the number of single-family homes that have been approved for construction but not started is up 8.5% since this time last year, according to Census data. As housing inventory continues to fall short of the 1.5 million homes now needed to meet historically high demand, President Joe Biden announced an initiative that aims to address the crisis. The White House proposes using federal dollars to boost the affordable housing supply. While the move may be a step in the right direction, experts say more will need to be done to attract workers back to the homebuilding industry and bring down prices on supplies — the two key areas causing the nation's dearth of available housing inventory."President Biden's plan to address housing affordability challenges is a welcome development, but the administration needs to focus more on resolving rising lumber and building material prices and supply chain bottlenecks that are raising housing costs far faster than wages," Jerry Konter, chairman of the NAHB, said in a statement. Building materials are hard to find — and they're also really expensive right nowIn 2021, more than 90% of builders reported delays and materials shortages, according to the NAHB. As home builders struggle to find basic materials like lumber or steel, it's delaying and increasing the price of construction projects."Shortages of materials are now more widespread than at any time since NAHB began tracking the issue in the 1990s, with more than 90% of builders reporting shortages of appliances, framing lumber and oriented strand board," NAHB researchers wrote. Even when builders do get their hands on materials, the cost is burning a hole in their wallets. According to the Bureau of Labor Statistics, the prices of goods used in residential construction have climbed 4.9% since the start of 2022  and 19.2% since this time last year. Overall, prices have risen 35.6% since the start of the pandemic – and they're likely to continue rising. Although the Biden administration has moved to lower tariffs placed on imports of Canadian softwood lumber, the NAHB says price spikes have added $18,500 to the price of an average new single-family home, while driving costs up nearly $8,000 for a multifamily home. "Historically high price levels for lumber and other building materials are dramatically affecting home prices and rental costs and threaten the nation's economic stability," Konter said in a statement, adding that supply chain price increases have only added to the ongoing housing affordability crisis.The lack of building materials is driving a construction  labor shortage The US can't build more homes if there's no one around to do the work.During the onset of the pandemic, fear of this virus' spread contributed to the delay of many construction projects. As building came to a halt, thousands of construction workers were either let go or sought out employment in other fields. Supply chain bottle necks  have also "damaged the livelihoods" of workers in the construction industry, resulting in notable job losses, according to scientific research publication IOP Publishing. After all, if workers don't have materials, they can't work — and that means they have to look elsewhere for a paycheck.Although residential building construction employment has now surpassed 2020 levels, the  industry is still facing a chronic labor shortage. According to the Associated Builders and Contractors association, the construction industry will need to attract nearly 650,000 additional workers on top of its normal pace of hiring in 2022. Additionally, the organization expects an estimated 1.2 million construction workers will leave their jobs for other industries by the end of the year."The workforce shortage is the most acute challenge facing the construction industry despite sluggish spending growth," Anirban Basu, ABC chief economist, said in a statement. The less construction workers there to build homes, the longer it will take for the sector to increase its supply of housing inventory. Although buyer demand has shown signs of cooling, the slower pace of construction is likely to keep home prices relatively high – and that could mean the imbalance of supply and demand will remain a  fixture of the US housing market. "A skilled and capable workforce that is adequate to meet our nation's housing demand is vital to home builders," NAHB researchers wrote. "Despite competitive pay, the home building industry continues to experience labor shortages, which impacts housing affordability."Read the original article on Business Insider.....»»

Category: topSource: businessinsiderMay 20th, 2022

Deere Reports Second Quarter Net Income of $2.098 Billion

Quarterly earnings rise 17% on increase in net sales of 9%. Market conditions and industry fundamentals support continuation of robust environment. Full-year earnings forecast increased to $7.0 to $7.4 billion, including special items. MOLINE, Ill., May 20, 2022 /PRNewswire/ -- Deere & Company (NYSE:DE) reported net income of $2.098 billion for the second quarter ended May 1, 2022, or $6.81 per share, compared with net income of $1.790 billion, or $5.68 per share, for the quarter ended May 2, 2021. For the first six months of the year, net income attributable to Deere & Company was $3.001 billion, or $9.72 per share, compared with $3.013 billion, or $9.55 per share, for the same period last year. Net sales and revenues increased 11 percent, to $13.370 billion, for the second quarter of 2022 and rose 8 percent, to $22.939 billion, for six months. Net sales were $12.034 billion for the quarter and $20.565 billion for six months, compared with $10.998 billion and $19.049 billion last year. "Deere's second-quarter performance reflected a continuation of strong demand even as we face supply-chain pressures affecting production levels and delivery schedules," said John C. May, chairman and chief executive officer. "Deere employees, suppliers, and dealers are working hard to address these challenges. We are proud of their extraordinary efforts to get products to our customers as soon as possible under the challenging circumstances." Company Outlook & Summary Net income attributable to Deere & Company for fiscal 2022 is forecast to be in a range of $7.0 billion to $7.4 billion, which includes a net $220 million gain from special items in the second quarter of 2022. For further details on special items, see Note 1 of the press release financial statements. "Looking ahead, we believe demand for farm equipment will continue benefiting from positive fundamentals in spite of availability concerns and inflationary pressures affecting our customers' input costs," May said. "The company's smart industrial strategy and recently announced Leap Ambitions are focused on helping customers manage higher costs and increasingly scarce inputs, while improving their yields, through the use of our integrated technologies." Deere & Company Second Quarter Year to Date $ in millions, except per share amounts 2022 2021 % Change 2022 2021 % Change Net sales and revenues $ 13,370 $ 12,058 11% $ 22,939 $ 21,170 8% Net income $ 2,098 $ 1,790 17% $ 3,001 $ 3,013 Fully diluted EPS $ 6.81 $ 5.68 $ 9.72 $ 9.55 Results for the second quarter of 2022 and year-to-date periods of 2022 and 2021 were impacted by special items. For further details, see Note 1 of the press release financial statements.  Production & Precision Agriculture Second Quarter $ in millions 2022 2021 % Change Net sales $ 5,117 $ 4,529 13% Operating profit $ 1,057 $ 1,007 5% Operating margin 20.7% 22.2% Production and precision agriculture sales increased for the quarter due to price realization and higher shipment volumes. Operating profit rose primarily due to price realization and higher shipment volumes / sales mix. These items were partially offset by higher production costs, higher research and development and selling, administrative, and general expenses, and impairments related to events in Russia / Ukraine.   Small Agriculture & Turf Second Quarter $ in millions 2022 2021 % Change Net sales $ 3,570 $ 3,390 5% Operating profit $ 520 $ 648 -20% Operating margin 14.6% 19.1% Small agriculture and turf sales for the quarter increased due to price realization partially offset by the unfavorable impact of currency translation. Operating profit decreased primarily due to higher production costs, a less-favorable sales mix, and higher selling, administrative, and general and research and development expenses. These items were partially offset by price realization.   Construction & Forestry Second Quarter $ in millions 2022 2021 % Change Net sales $ 3,347 $ 3,079 9% Operating profit $ 814 $ 489 66% Operating margin 24.3% 15.9% Construction and forestry sales moved higher for the quarter primarily due to price realization and higher shipment volumes, partially offset by the unfavorable impact of currency translation. Operating profit increased due to a non-cash gain on the remeasurement of the previously held equity investment in the Deere-Hitachi joint venture and price realization. These items were partially offset by higher production costs, impairments related to the events in Russia / Ukraine, and a less-favorable product mix.   Financial Services Second Quarter $ in millions 2022 2021 % Change Net income $ 208 $ 222 -6% The decrease in financial services net income for the quarter was mainly due to higher reserves for credit losses related to the events in Russia / Ukraine, partially offset by income earned on a higher average portfolio. The prior year also benefited from a favorable adjustment to the provision for credit losses. Industry Outlook for Fiscal 2022 Agriculture & Turf U.S. & Canada: Large Ag Up ~ 20% Small Ag & Turf ~ Flat Europe Up ~ 5% South America (Tractors & Combines) Up ~ 10% Asia Down moderately Construction & Forestry U.S. & Canada: Construction Equipment Up ~ 10% Compact Construction Equipment Flat to Up 5% Global Forestry Flat to Up 5% Global Roadbuilding Flat to Up 5% Deere Segment Outlook for Fiscal 2022 Currency Price $ in millions Net Sales Translation Realization Production & Precision Ag Up 25 to 30% -1% +13% Small Ag & Turf Up ~ 15% -3% +8% Construction & Forestry Up 10 to 15% -2% +9% Financial Services Net Income $ 870 Financial Services. Full-year 2022 results are expected to be slightly lower than fiscal 2021 due to a higher provision for credit losses and higher selling, administrative, and general expenses. These factors are expected to be partially offset by income earned on a higher average portfolio. John Deere Capital Corporation The following is disclosed on behalf of the company's financial services subsidiary, John Deere Capital Corporation (JDCC), in connection with the disclosure requirements applicable to its periodic issuance of debt securities in the public market. Second Quarter Year to Date $ in millions 2022 2021 % Change 2022 2021 % Change Revenue $ 651 $ 675 -4% $ 1,294 $ 1,332 -3% Net income $ 159 $ 177 -10% $ 348 $ 344 1% Ending portfolio balance $ 42,543 $ 40,613 5% Results in the quarter decreased due to a higher provision for credit losses and less-favorable financing spreads, partially offset by income earned on a higher average portfolio. For the year-to-date period, net income rose mainly due to income earned on a higher average portfolio and improvement on operating-lease residual values, partially offset by a higher provision for credit losses and less-favorable financing spreads. The prior year also benefited from a favorable adjustment to the provision for credit losses. FORWARD-LOOKING STATEMENTS Certain statements contained herein, including in the sections entitled "Company Outlook & Summary," "Industry Outlook," and "Deere Segment Outlook," relating to future events, expectations, and trends constitute "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995 and involve factors that are subject to change, assumptions, risks, and uncertainties that could cause actual results to differ materially. Some of these risks and uncertainties could affect all lines of the company's operations, generally, while others could more heavily affect a particular line of business. Forward-looking statements are based on currently available information and current assumptions, expectations, and projections about future events. Except as required by law, the company undertakes no obligation to update or revise its forward-looking statements. Further information concerning the company and its businesses, including factors that could materially affect the company's financial results, is included in the company's other filings with the SEC (including, but not limited to, the factors discussed in Item 1A. "Risk Factors" of the company's most recent Annual Report on Form 10-K and the company's subsequent Quarterly Reports on Form 10-Q). Factors Affecting All Lines of Business All of the company's businesses and their results are affected by general economic conditions in the global markets and industries in which the company operates; customer confidence in general economic conditions; government spending and taxing; foreign currency exchange rates and their volatility, especially fluctuations in the value of the U.S. dollar; changing interest rates; inflation and deflation rates; changes in weather and climate patterns; the political and social stability of the global markets in which the company operates; the effects of, or response to, terrorism and security threats; wars and other conflicts, including the current military conflict between Russia and Ukraine; natural disasters; and the spread of major epidemics or pandemics (including the COVID-19 pandemic). Significant changes in market liquidity conditions, changes in the company's credit ratings, and any failure to comply with financial covenants in credit agreements could impact access to funding and funding costs, which could reduce the company's earnings and cash flows. Financial market conditions could also negatively impact customer access to capital for purchases of the company's products and purchase decisions, financing and repayment practices, and the number and size of customer delinquencies and defaults. A debt crisis in Europe, Latin America, or elsewhere could negatively impact currencies, global financial markets, funding sources and costs, asset and obligation values, customers, suppliers, and demand for equipment. The company's investment management activities could be impaired by changes in the equity, bond, and other financial markets, which would negatively affect earnings. Additional factors that could materially affect the company's operations, access to capital, expenses, and results include changes in, uncertainty surrounding, and the impact of governmental trade, banking, monetary, and fiscal policies, including financial regulatory reform and its effects on the consumer finance industry, derivatives, funding costs, governmental programs, policies, and tariffs for the benefit of certain industries or sectors; retaliatory actions to such changes in trade, banking, monetary, and fiscal policies; actions by central banks; actions by financial and securities regulators; actions by environmental, health, and safety regulatory agencies, including those related to engine emissions, carbon and other greenhouse gas emissions, and the effects of climate change; changes to GPS radio frequency bands or their permitted uses; changes in labor and immigration regulations; changes to accounting standards; changes in tax rates, estimates, laws, and regulations and company actions related thereto; changes to and compliance with privacy, banking, and other regulations; changes to and compliance with economic sanctions and export controls laws and regulations; and compliance with U.S. and foreign laws when expanding to new markets and otherwise. Other factors that could materially affect the company's results and operations include security breaches, cybersecurity attacks, technology failures, and other disruptions to the information technology infrastructure of the company and its suppliers and dealers; security breaches with respect to the company's products; production, design, and technological innovations and difficulties, including capacity and supply constraints and prices; the loss of or challenges to intellectual property rights, whether through theft, infringement, counterfeiting, or otherwise; the availability and prices of strategically sourced materials, components, and whole goods; delays or disruptions in the company's supply chain, including work stoppages or disputes by suppliers with their unionized labor; the failure of customers, dealers, suppliers, or the company to comply with laws, regulations, and company policy pertaining to employment, human rights, health, safety, the environment, sanctions, export controls, anti-corruption, privacy and data protection, and other ethical business practices; introduction of legislation that could affect the company's business model and intellectual property, such as right to repair or right to modify; events that damage the company's reputation or brand; significant investigations, claims, lawsuits, or other legal proceedings; start-up of new plants and products; the success of new product initiatives or business strategies; changes in customer product preferences and sales mix; gaps or limitations in rural broadband coverage, capacity, and speed needed to support technology solutions; oil and energy prices, supplies, and volatility; the availability and cost of freight; actions of competitors in the various industries in which the company competes, particularly price discounting; dealer practices, especially as to levels of new and used field inventories; changes in demand and pricing for used equipment and resulting impacts on lease residual values; labor relations and contracts, including work stoppages and other disruptions; changes in the ability to attract, develop, engage, and retain qualified personnel; acquisitions and divestitures of businesses; greater-than-anticipated transaction costs; the integration of acquired businesses; the failure or delay in closing or realizing anticipated benefits of acquisitions, joint ventures, or divestitures; the inability to deliver precision technology and agricultural solutions to customers; and the failure to realize anticipated savings or benefits of cost reduction, productivity, or efficiency efforts. COVID-19 Uncertainties related to the continued effects of the COVID-19 pandemic have adversely affected and may continue to affect the company's business and outlook. These uncertainties include, among other things: the duration and impact of any resurgence in COVID-19; disruptions in the supply chain, including those caused by industry capacity constraints, material availability, and global logistics delays and constraints arising from, among other things, the transportation capacity of ocean shipping containers, and continued disruptions in the operations of one or more key suppliers, or the failure of any key suppliers; an increasingly competitive labor market due to a sustained labor shortage or increased turnover caused by the COVID-19 pandemic; the sustainability of the economic recovery from the pandemic remains unclear and significant volatility could continue for a prolonged period. Agricultural Equipment Operations The company's agricultural equipment operations are subject to a number of uncertainties, including certain factors that affect farmers' confidence and financial condition. These factors include demand for agricultural products; world grain stocks; soil conditions; harvest yields; prices for commodities and livestock; crop and livestock production expenses; availability of fertilizer; availability of transport for crops; trade restrictions and tariffs; global trade agreements; the level of farm product exports; the growth and sustainability of non-food uses for some crops (including ethanol and biodiesel production); real estate values; available acreage for farming; changes in government farm programs and policies; international reaction to such programs; changes in and effects of crop insurance programs; changes in environmental regulations and their impact on farming practices; animal diseases and their effects on poultry, beef, and pork consumption and prices on livestock feed demand; and crop pests and diseases. Production and Precision Agriculture Operations The production and precision agriculture operations rely in part on hardware and software, guidance, connectivity and digital solutions, and automation and machine intelligence. Many factors contribute to the company's precision agriculture sales and results, including the impact to customers' profitability and/or sustainability outcomes; the rate of adoption and use by customers; availability of technological innovations; speed of research and development; effectiveness of partnerships with third parties; and the dealer channel's ability to support and service precision technology solutions. Small Agriculture and Turf Equipment Factors affecting the company's small agriculture and turf equipment operations include customer profitability; labor supply; consumer borrowing patterns; consumer purchasing preferences; housing starts and supply; infrastructure investment; spending by municipalities and golf courses; and consumable input costs. Construction and Forestry Factors affecting the company's construction and forestry equipment operations include consumer spending patterns; real estate and housing prices; the number of housing starts; interest rates; commodity prices such as oil and gas; the levels of public and non-residential construction; and investment in infrastructure. Prices for pulp, paper, lumber, and structural panels affect sales of forestry equipment. John Deere Financial The liquidity and ongoing profitability of John Deere Capital Corporation and the company's other financial services subsidiaries depend on timely access to capital in order to meet future cash flow requirements, and to fund operations, costs, and purchases of the company's products. If general economic conditions deteriorate or capital markets become more volatile, funding could be unavailable or insufficient. Additionally, customer confidence levels may result in declines in credit applications and increases in delinquencies and default rates, which could materially impact write-offs and provisions for credit losses.   DEERE & COMPANYSECOND QUARTER 2022 PRESS RELEASE(In millions of dollars) Unaudited Three Months Ended Six Months Ended May 1 May 2  % May 1 May 2  % 2022 2021 Change 2022 2021 Change Net sales and revenues:    Production & precision ag net sales $ 5,117 $ 4,529 +13 $ 8,473 $ 7,599 +12    Small ag & turf net sales 3,570 3,390 +5 6,201 5,904 +5    Construction & forestry net sales 3,347 3,079 +9 5,891 5,546 +6    Financial services revenues 864 892 -3 1,734 1,776 -2    Other revenues 472 168 +181 640 345 +86      Total net sales and revenues $ 13,370 $ 12,058 +11 $ 22,939 $ 21,170 +8 Operating profit: *    Production & precision ag $ 1,057 $ 1,007 +5 $ 1,353 $ 1,651 -18    Small ag & turf 520 648 -20 891 1,117 -20    Construction & forestry 814 489 +66 1,085 756 +44    Financial services 279 295 -5 577 553 +4      Total operating profit 2,670 2,439 +9 3,906 4,077 -4 Reconciling items ** (111) (119) -7 (195) (226) -14 Income taxes (461) (530) -13 (710) (838) -15      Net income attributable to Deere & Company $ 2,098 $ 1,790 +17 $ 3,001 $ 3,013 *      Operating profit is income from continuing operations before corporate expenses, certain external interest expense, certain foreign exchange gains and losses, and income taxes. Operating profit of the financial services segment includes the effect of interest expense and foreign exchange gains or losses. **      Reconciling items are primarily corporate expenses, certain external interest expense, certain foreign exchange gains and losses, pension and postretirement benefit costs excluding the service cost component, and net income attributable to noncontrolling interests.   DEERE & COMPANYSTATEMENTS OF CONSOLIDATED INCOMEFor the Three Months Ended May 1, 2022 and May 2, 2021(In millions of dollars and shares except per share amounts) Unaudited 2022 2021 Net Sales and Revenues Net sales $ 12,034 $ 10,998 Finance and interest income 796 809 Other income 540 251    Total 13,370 12,058 Costs and Expenses Cost of sales 8,918 7,928 Research and development expenses 453 377 Selling, administrative and general expenses 932 838 Interest expense 187 268 Other operating expenses 328 335    Total 10,818 9,746 Income of Consolidated Group before Income Taxes 2,552 2,312 Provision for income taxes 461 530 Income of Consolidated Group 2,091 1,782 Equity in income of unconsolidated affiliates 6 8 Net Income 2,097 1,790    Less: Net loss attributable to noncontrolling interests (1) Net Income Attributable to Deere & Company $ 2,098 $ 1,790 Per Share Data Basic $ 6.85 $ 5.72 Diluted $ 6.81 $ 5.68 Dividends declared $ 1.05 $ .90 Dividends paid $ 1.05 $ .76 Average Shares Outstanding Basic 306.2 312.8 Diluted 308.1 315.2 See Condensed Notes to Interim Consolidated Financial Statements.   DEERE & COMPANYSTATEMENTS OF CONSOLIDATED INCOMEFor the Six Months Ended May 1, 2022 and May 2, 2021(In millions of dollars and shares except per share amounts) Unaudited 2022 2021 Net Sales and Revenues Net sales $ 20,565 $ 19,049 Finance and interest income 1,595 1,644 Other income 779 477     Total 22,939 21,170 Costs and Expenses Cost of sales 15,613 13,734 Research and development expenses 855 743 Selling, administrative and general expenses 1,713 1,607 Interest expense 417 538 Other operating expenses 638 708     Total 19,236 17,330 Income of Consolidated Group before Income Taxes 3,703 3,840 Provision for income taxes 710 838 Income of Consolidated Group 2,993 3,002 Equity in income of unconsolidated affiliates 8 12 Net Income 3,001 3,014     Less: Net income attributable to noncontrolling interests 1 Net Income Attributable to Deere & Company $ 3,001 $ 3,013 Per Share Data Basic $ 9.78 $ 9.62 Diluted $ 9.72 $ 9.55 Dividends declared $ 2.10 $ 1.66 Dividends paid $ 2.10 $ 1.52 Average Shares Outstanding Basic 306.8 313.1 Diluted 308.8 315.6 See Condensed Notes to Interim Consolidated Financial Statements.   DEERE & COMPANYCONDENSED CONSOLIDATED BALANCE SHEETS(In millions of dollars) Unaudited May 1 October 31 May 2  2022 2021 2021 Assets Cash and cash equivalents $ 3,878 $ 8,017 $ 7,182 Marketable securities 682 728 668 Trade accounts and notes receivable - net 6,258 4,208 6,158 Financing receivables - net 34,085 33,799 30,994 Financing receivables securitized - net 4,073 4,659 4,107 Other receivables 2,306 1,765 1,504 Equipment on operating leases - net 6,465 6,988 7,108 Inventories 9,030 6,781 6,042 Property and equipment - net 5,715 5,820 5,704 Goodwill 3,812 3,291 3,190 Other intangible assets - net 1,352 1,275 1,310 Retirement benefits 3,059 3,601 951 Deferred income taxes 1,104 1,037 1,724 Other assets 2,280 2,145 2,337 Total Assets $ 84,099 $ 84,114 $ 78,979 Liabilities and Stockholders' Equity Liabilities Short-term borrowings $ 12,413 $ 10,919 $ 9,911 Short-term securitization borrowings 4,006 4,605 4,106 Accounts payable and accrued expenses 12,679 12,348 10,682 Deferred income taxes 584 576 533 Long-term borrowings 32,447 32,888 33,346 Retirement benefits and other liabilities 2,964 4,344 5,305     Total liabilities 65,093 65,680 63,883 Redeemable noncontrolling interest 99 Stockholders' Equity Total Deere & Company stockholders' equity 18,904 18,431 15,092 Noncontrolling interests 3 3 4    Total stockholders' equity 18,907 18,434 15,096 Total Liabilities and Stockholders' Equity $ 84,099 $ 84,114 $ 78,979 See Condensed Notes to Interim Consolidated Financial Statements.    DEERE & COMPANYSTATEMENTS OF CONSOLIDATED CASH FLOWSFor the Six Months Ended May 1, 2022 and May 2, 2021(In millions of dollars) Unaudited 2022 2021 Cash Flows from Operating Activities Net income $ 3,001 $ 3,014 Adjustments to reconcile net income to net cash provided by (used for) operating activities:    Provision (credit) for credit losses 45 (24)    Provision for depreciation and amortization 933 1,054    Impairment charges 77 50    Share-based compensation expense 44 45    Gain on remeasurement of previously held equity investment (326)    Undistributed earnings of unconsolidated affiliates (2) 11    Provision (credit) for deferred income taxes 37 (213)    Changes in assets and liabilities:      Trade, notes, and financing receivables related to sales (1,535) (1,124)      Inventories (2,265) (1,193)      Accounts payable and accrued expenses (443) 318      Accrued income taxes payable/receivable (139) 54      Retirement benefits (1,020) (5)    Other (169) (201)      Net cash provided by (used for) operating activities (1,762) 1,786 Cash Flows from Investing Activities Collections of receivables (excluding receivables related to sales) 11,190 10,367 Proceeds from sales of equipment on operating leases 1,035 1,011 Cost of receivables acquired (excluding receivables related to sales) (11,971) (11,359) Acquisitions of businesses, net of cash acquired (473) (19) Purchases of property and equipment (346) (320) Cost of equipment on operating leases acquired (1,004) (764) Collateral on derivatives – net (248) (255) Other (71) (48)      Net cash used for investing activities (1,888) (1,387) Cash Flows from Financing Activities Increase in total short-term borrowings 812 212 Proceeds from long-term borrowings 4,298 3,967 Payments of long-term borrowings (3,625) (3,157) Proceeds from issuance of common stock.....»»

Category: earningsSource: benzingaMay 20th, 2022

Parkview Financial Provides $21.5 Million Loan for Vacant Hotel Acquisition and Conversion to Apartments/Retail in Newark, NJ

Parkview Financial announced today it has provided a $21.5 million loan to Broad Street Ventures Urban Renewal, LLC, an entity of Winchester Equities, LLC, for the purchase and conversion of a currently vacant, 13-story, 90,000-square-foot (sf) hotel into a 106-unit multifamily building with a 7,500-sf ground floor restaurant. Located at 810... The post Parkview Financial Provides $21.5 Million Loan for Vacant Hotel Acquisition and Conversion to Apartments/Retail in Newark, NJ appeared first on Real Estate Weekly. Parkview Financial announced today it has provided a $21.5 million loan to Broad Street Ventures Urban Renewal, LLC, an entity of Winchester Equities, LLC, for the purchase and conversion of a currently vacant, 13-story, 90,000-square-foot (sf) hotel into a 106-unit multifamily building with a 7,500-sf ground floor restaurant. Located at 810 Broad Street in Newark, NJ, the project is now underway with completion anticipated for late 2022. Once renovated, the property will include a unit mix of 98 micro-studios each totaling approximately 357 sf and eight one-bedroom units ranging between 664 sf and 695 sf. All of the apartments will come fully furnished with 22 slated for low-income housing. The interiors will feature high-end murphy bed solutions, shelving, storage areas, modern kitchenettes, wine coolers, 65” smart TVs, video conferencing technology, and smart thermostats, among other upgrades. The property will also offer common area amenities such as a fitness center, a spa, laundry facilities on each floor, a co-working lounge, a party room, a café, and the only rooftop bar in Newark with views of New York City. “This will be Winchester Equities’ fifth project in Newark,” said Paul Rahimian, CEO and Founder of Parkview Financial. “Parkview saw this as a favorable opportunity to lend to an experienced developer and owner. We believe that this strategically located asset will be attractive to college students and young professionals within this rapidly growing Essex County submarket.” Located across from The Prudential Center, the property provides excellent access to local transportation such as the PATH train to New York City and the New Jersey Transit train. 810 Broad Street was built in 1912 as the headquarters of First National State Bank and was designed by Cass Gilbert, who also designed the U.S. Supreme Court building in Washington D.C. and the Woolworth Building in New York City. In 2014, the building underwent a $29 million hotel conversion renovation. Winchester Equities recently completed a 63-unit luxury apartment building at 45-53 William Street (William House) and is currently underway on a 60,000-fs multifamily renovation at 303 Washington Street. The post Parkview Financial Provides $21.5 Million Loan for Vacant Hotel Acquisition and Conversion to Apartments/Retail in Newark, NJ appeared first on Real Estate Weekly......»»

Category: realestateSource: realestateweeklyMay 19th, 2022

MarketStreet Enterprises unveils details for Fairgrounds residential project

MarketStreet Enterprises has unveiled details for the project it's building by Geodis Park. The development is set to include more than 300 mixed-income housing units......»»

Category: topSource: bizjournalsMay 19th, 2022

Existing-Home Sales Maintain Decline in April

The downward trend in existing home sales held firm in April as rising price tags and mortgage rates continued to strain buyer activity, according to a new report from the National Association of REALTORS® (NAR). Sales of previously owned homes dipped for the third consecutive month in April, sliding by 2.4% to a seasonally adjusted… The post Existing-Home Sales Maintain Decline in April appeared first on RISMedia. The downward trend in existing home sales held firm in April as rising price tags and mortgage rates continued to strain buyer activity, according to a new report from the National Association of REALTORS® (NAR). Sales of previously owned homes dipped for the third consecutive month in April, sliding by 2.4% to a seasonally adjusted annual rate of 5.61 million. Year-over-year, sales dropped 5.9%. Month-over-month sales activity across all four major U.S. regions was a mixed bag as two areas posted gains while the other two experienced waning last month. However, all four regions saw a dip in sales annually. Single-family home sales were down 2.5% from March to a seasonally adjusted annual rate of 4.99 million. Condos and co-op sales also declined by 1.6% in March to a seasonally adjusted annual rate of 740,000 units in April. According to NAR experts, the combination of higher home prices and mortgage rates has continued to weigh down on buyer activity, who indicated that the decline in sales activity would likely persist in the coming month and return to pre-pandemic levels. At the end of April, housing stock hit 1,030,000 units, marking 10.8% from March but a 10.4% decline YoY. Regional Breakdown: Northeast Existing-Home Sales: 670,000 (+1.5% MoM; -10.7% YoY) Median Price: $412,000 (+8.1% YoY) Midwest Existing-Home Sales: 1.31 million (+4.1% MoM; -2.6% YoY) Median Price: $282,000 (+8.7% YoY) South Existing-Home Sales: 2.49 million (-4.6% MoM; -5.7% YoY) Median Price: $352,100 (+22.2% YoY) West Existing-Home Sales: 1.14 million (-5.8% MoM; -8.1% YoY) Median Price: $523,000 (+4.3% YoY) The takeaway: “As we find ourselves in the midst of a massive housing shortage, NAR continues to work with leaders across the private and public sectors to help close this deficit,” said NAR President Leslie Rouda Smith. “As the nation’s largest real estate association, we are urging policymakers to enact zoning reforms, homebuilder incentives, and other necessary regulations to help correct this situation.” “Higher home prices and sharply higher mortgage rates have reduced buyer activity,” said Lawrence Yun, NAR’s chief economist. “It looks like more declines are imminent in the upcoming months, and we’ll likely return to the pre-pandemic home sales activity after the remarkable surge over the past two years. “The market is quite unusual as sales are coming down, but listed homes are still selling swiftly, and home prices are much higher than a year ago. Moreover, an increasing number of buyers with short tenure expectations could opt for 5-year adjustable-rate mortgages, thereby ensuring fixed payments over five years because of the rate reset. The cash buyers, not impacted by mortgage rate changes, remain elevated.” “Rising mortgage rates, which first crossed the 5% threshold in April, have kept climbing as the Fed adjusts monetary policy to a less accommodative posture,” said Danielle Hale, chief economist at®. “While higher rates are expected to eventually reign in price increases, typical home sale prices grew 14.8% in April as buyers felt pressure on their budgets and urgency to move quickly. “The number of households interested in becoming homeowners remains high, despite waning confidence that now is a good time to buy. This is especially true among younger home shoppers, who are likely to be first-time buyers and are struggling to save for a down payment as rents continue to hit records, as seen in the dip in first-time buyers to 28% in April. At the same time, seller expectations for higher down payments seem to be rising, fueled by a still-competitive housing market and repeat buyers with relatively more equity at their disposal. “Homeowners considering a sale this year still hold most of the cards, but will want to keep on top of a rapidly-adjusting market poised for a reset—a real estate refresh. housing data shows that there were fewer homes actively for sale in April than in the year prior, but by the first week of May, the trend flattened. In the most recent weekly data, we saw the biggest yearly jump in active listings since March 2019, as more homeowners decided to sell and more searchers decided to hit pause. The combination of these trends means home shoppers—at least those who can navigate higher mortgage rates and monthly payments – will have more homes to choose from relative to last year, even as options are fewer than before the pandemic.” “The combination of higher prices and higher mortgage rates continue to negatively impact home sales,” said Joel Kan, AVP of Economic and Industry Forecasting for the Mortgage Bankers Association. “Although the job market is still extremely strong, emerging signs of economic weakness have also added to the overall uncertainty for potential homebuyers. Steep home-price appreciation was particularly impactful on first-time home buyers, who have seen their share of home sales decrease to 28% compared to 31% a year ago.” “Inventory is a key component of housing market conditions, and the limited availability of homes for sale has been adding to upward pressure on prices, delaying some purchase activity. While there was a slight increase in the number of homes for sale to just over 1 million units, this was likely due to the declining sales pace as demand slows. At just over a two-month supply, inventory is still extremely low by historical standards, and the recent slowdown in residential construction activity may prolong this shortage.” The post Existing-Home Sales Maintain Decline in April appeared first on RISMedia......»»

Category: realestateSource: rismediaMay 19th, 2022

Looking Ahead, Experts Parse ‘Overvalued’ and ‘At-Risk’ Markets

In some markets, the numbers are cartoonish. The city of Punta Gorda, Florida—a gulf coast suburb with a population of around 20,000 about an hour’s drive north of Fort Myers—saw home prices rise almost 30% between spring of 2021 and 2022, a third more than the national average. Three states saw average price appreciation top… The post Looking Ahead, Experts Parse ‘Overvalued’ and ‘At-Risk’ Markets appeared first on RISMedia. In some markets, the numbers are cartoonish. The city of Punta Gorda, Florida—a gulf coast suburb with a population of around 20,000 about an hour’s drive north of Fort Myers—saw home prices rise almost 30% between spring of 2021 and 2022, a third more than the national average. Three states saw average price appreciation top 25% earlier this year (Florida, Arizona and Utah) and three metros in California (San Diego, San Jose and San Francisco) saw home price growth outstrip median wages by more than six figures in raw dollar amounts. While experts and economists are still convinced that the current market is nothing like that which preceded the Great Recession, a pullback—small or significant—has long seemed inevitable. When that happens, there will almost certainly be some markets hit harder than others based on the degree prices have been inflated over economic fundamentals. Ken Johnson, a researcher and economist at Florida Atlantic University (FAU), helps lead a project that compares current home prices with a baseline appreciation relying on long-term historical trends, using a methodology intended to offer “practical usefulness” to consumers and real estate professionals. By this measure, 99 out of 100 markets surveyed were overvalued as of last month, with 13 metros seeing current home prices 50% above where they should be, and one city (Boise, Idaho) at 75% overvalued. While eventually, all regions should see their prices fall back to this level, whether that happens abruptly or not depends on fundamentals, and the specific conditions of that market. Eli Beracha, another researcher on the project and a professor at Florida Atlantic University, said in a statement that even at these ridiculous levels, a pull-back won’t mean homes losing a majority of their values, as was the case in 2008. “At the peak of the last housing cycle, we had an oversupply of housing units around the country,” Beracha said. “So when prices began to fall, there was nothing to catch them, and we witnessed a monumental crash. The current shortage of homes for sale will help put a floor under just how far prices can fall this time around.” Johnson said one way to predict which markets will struggle to absorb a downturn is looking at where there is minimal or no population growth alongside the housing price increase, singling out Memphis, Tennessee and Detroit, Michigan as examples of this dynamic. According to Zillow, Memphis home prices were up 22.7% in April. At the same time, the city actually suffered a net loss of households, according to a University of Tennessee analysis. Austin, Texas, with a staggering price appreciation of 40.8% by Zillow’s estimate, also grew in population by 2.3% between 2020 and 2021, according to census data. That might make the city—and others like it—more able to weather a downturn, with a thriving labor market and tighter inventory to bolster the real estate economy. Johnson said the tradeoff is unfortunately that housing will remain inaccessible longer in these areas, while regions that snap back to more reasonable prices will become more affordable in the near future. “Essentially, you have to pick your poison,” Johnson said. “Is it better for you to live in an area with major price declines so housing is more affordable again, or in an area with modest or very small price declines that keep homes out of reach for many middle-class Americans?” Two other analyses have tried to break down this concept of “overvalued” amid historically uninhibited price growth. California-based ATTOM Data Solutions published a list of “vulnerable” markets at the beginning of the year, and CoreLogic more recently identified downturn risk in about 400 home markets across the country, rating them from “very low” to “elevated.” That analysis also singled out markets as overvalued, with 65% of its selected meeting that criteria. Just because a market was overvalued did not automatically leave it at risk for a downturn, according to the researchers. According to CoreLogic, while Austin is overvalued, the risk from a downturn is very low. Conversely, Detroit was rated as “undervalued” based on the increase in local wages, but still at a medium risk for a downtown overall—again based on fundamentals. Another market that is not significantly overvalued according to FAU (7.69% price above long-term estimate), but is at risk of a downturn is Stamford, Connecticut in the New York suburbs. CoreLogic rated this city as a high risk for a downturn in the company’s analysis, and in its most recent Home Price Index, report warned that the area has more than a 70% probability of price decline in the next 12 months. Paul Ferreira, a team leader for RE/MAX with almost 2,000 homes sold in the area, told RISMedia earlier this year that he has been advising clients for several months to hold off on buying out of fear of a downturn. “If they can’t find the property, a lot of these people are starting to sit out the market,” he says, “And I think that’s starting to affect the market—people’s ability to persevere over all these crazy offers.” Sellers are looking at what their neighbors’ home sold for a few months ago and listing at unreasonably high prices, Ferreira explains—but are no longer getting offers at that level, at least not at certain price points. “I’m starting to see a chink in the armor,” he warns. Using local income levels as a barometer can be useful—as both the ATTOM and CoreLogic analyses did—but that metric is also growing more disconnected from the local housing market, according to Jordan Levine, vice president and chief economist for the California Association of REALTORS®. Speaking to RISMedia specifically about the ATTOM report, Levine warned that some of the issues showing up in these numbers would be less acute if remote workers and their incomes were accounted for, and that there aren’t as many “fundamental issues” as were seen in 2008. “That tends to exacerbate the kind of risk factors that show up in those numbers,” he added. The post Looking Ahead, Experts Parse ‘Overvalued’ and ‘At-Risk’ Markets appeared first on RISMedia......»»

Category: realestateSource: rismediaMay 19th, 2022