Perth has the highest-ever number of suburbs in the million-dollar club, after prices in 15 new suburbs recently exceeded the milestone median.
Research from CoreLogic shows there were 56 suburbs in Perth with median house prices above $1 million in May this year, compared to 41 a year previously.
Adding to fears about the affordability of Perth property, the new research shows in the year to May, 13 per cent of sales recorded a price of at least $1 million.
CoreLogic research analyst Kaytlin Ezzy said the suburban median in the million-dollar-club is almost twice Perth’s overall house median of $555,538, following a 5.6 per cent price rise across the metropolitan area in the year to May.
The new million dollar suburbs appear to be popular for many of the same reasons as those that lead the pack — close proximity to water, big blocks, good schools and proximity to the city.
Suburbs close to either the beach or the river include Fremantle, South Fremantle, Hillarys, Karrinyup, Iluka, Como, Alfred Cove, Shelley and Burns Beach.
Good schools and proximity to the city are likely to underpin the popularity of some of the inner-city suburbs on the list, including Gwelup — which increased from $859,5549 a year previously — as well as Inglewood, and Mount Hawthorn.
Como specialist for The Agency, Vanessa Naso, said her patch enjoyed the benefit of a riverside and central location as well as big blocks and good schools.
Nine of Perth’s top 10 most expensive house markets were located in the city’s inner region, with Dalkeith recording the highest median value at $2.96 million.
It eclipsed Peppermint Grove, were the median is $2,824,616, and Cottesloe ($2,689,912)
Yallingup houses in the picturesque south west town remain the west’s only regional market to make the million-dollar list with a current median value of $1,620,473
The research found that nationally, 1,367 or 30.4 per cent of house and unit markets analysed in May recorded a median value of $1 million or more.
“High consumer sentiment, tight advertised supply, and low interest rates fuelled strong home value growth throughout 2021, resulting in a new record high annual growth rate of 22.4 per cent nationally over the 12 months to January,” Ms Ezzy said.
Herbert Street, Waipukurau
The
premises housing one of Hawke’s Bay’s oldest law firms,
other professionals and the world’s biggest submarine
sandwich franchise have been placed on the market for
sale.
The 2,126-square metre site includes a
1,350-square metre industrial-styled office building and is
located at No. 9 Herbert Street in the centre of the Central
Hawke’s Bay township of Waipukurau.
The original
industrial building was converted into an architecturally
designed law office, utilising the design nous of renowned
architects, KebbellDaish from Wellington. The result is an
impressive professional space with a strong underlying sense
of the district’s rural backbone.
KebbellDaish
describe the project on their website as an “idea farm”
which remains an appropriate description of the property’s
current mix of professional tenants who all have strong
roots in the rural community.
The renovation involved
an extensive upgrade of the exterior building envelope and
the construction of pod type offices within the large open
plan space. The extensive use of clear finished timber and
sound control systems in each individual office space
provides an effective and attractive aesthetic. The
macrocarpa flooring, stepped trellis, and baffles all nod to
the rural theme.
The main tenant is DAC Legal which
has been part of Hawke’s Bay’s business community since
1907 when a legal practice was formed by solicitor W C
Hewitt.
Also within the building is convenience food
retailer Subway, which is the world’s largest submarine
sandwich chain with more than 44,000 locations around the
globe – including 246 sites in New Zealand.
A
further tenant is project management consultancy firm
ProjectHaus who work alongside both central and local
government on land management and other projects.
A
branch of The Surveying Company HB is also located in the
building, and is a sub tenant of DAC Legal. The Surveying
Company have successfully completed thousands of land
surveys, subdivisions, and surveying-related activities in
New Zealand.
Rounding out the tenancy schedule within
the building is farming IT consultancy Cloud Farmer who
provides digital solutions for day-to-day farm
recording.
The land and building is being marketed for
sale by negotiation through Bayleys Napier. Salesperson
Kerry Geange said the property offered a true ‘split
risk’ investment opportunity with the five tenants
operating in various industries.
The land is zoned
Business 1 – Inner Commercial under the Central Hawke’s
Bay District Council Plan. The four lead tenancies generate
net annual income of $159,736 plus GST, and
encompass:
- Law practice DAC Legal on a lease
running through to 2024 with two further five-year rights of
renewal. generating annual net rental of $101,250 plus GST,
with rent reviews every five-years - Convenience food
outlet Subway on a lease running through to 2026 with two
further six-year rights of renewal, generating annual net
rental of $30,100 plus GST, with rent reviews every
two-years - Project management consultancy ProjectHaus
on a lease running through to 2023 with two further two-year
rights of renewal, generating annual net rental of $18,386
plus GST, with rent reviews every two-years - Land
surveyors The Surveying Company HB on a sub-lease to DAC
Legal
and
- Farm management IT firm
Cloud Farmer on a lease running through to 2024, generating
annual net rental of $10,000 plus GST.
The
property is located on a high-profile corner in
Waipukurau’s central business district in close proximity
to the town’s major retailers and service providers.
Herbert Street also comprises part of State Highway 2 which
runs through Waipukurau’s town centre.
The building
is serviced by some 30 car parks for staff and visitors and
it’s zoning underpins intensive commercial activities in
Waipukurau.
The sawtooth design of the building has
been highlighted as a feature allowing for high stud
ceilings and an expanse of natural lighting through the
clever use of part of the sawtooth angled roofline.
A
reconfiguration of some of the front offices and workspaces
has created separate modern work environments comprising a
mix of polished concrete, richly-grained wooden flooring,
closed and open-plan spaces. A feature has been made of both
the trellised steel beams and the original wooden beams
which span the overhead space that is lined with acoustic
dampening material.
Floor to ceiling hush glass runs
along the northern side of the building capturing all-day
sun in the cooler months and the integration of the northern
sawtooth overhang provides protection from the strong HB sun
during the summer months.
Meanwhile, Subway’s
footprint within the building is a replicative foodservice
format and is one of the company’s biggest sites in New
Zealand. The Subway premises include a dining floor,
public-facing food preparation benching, and walk-in chiller
storage units and staff amenities housed in the rear portion
of the premises.
With a population of 4,580 people,
Waipukurau is the largest town in Central Hawke’s Bay and
is only 6km from neighbouring Waipawa. State Highway 2 and
the rail line pass through the town which has a strong rural
support/service industry.
The Central Hawkes’ Bay
District Council identifies Waipukurau as an area of current
and projected growth in line with the district’s
unprecedented rate of growth in the past few years. The
Council forecasts the construction of 1,449 new houses and a
population exceeding 18,000 in Central Hawke’s Bay by
2031.
Click here
for more information on this
listing.
New Zealand
Bayleys is New Zealand’s largest full-service real estate company. We offer expertise in the marketing and sale of a wide range of property, including residential real estate, farms and lifestyle blocks, and commercial and industrial property. This includes tourism and business sales such as hotels and motels. We also cover the real estate markets in Fiji and other Pacific Islands.
Bayleys also provides a complete property and facilities service including property management and valuations teams focused on achieving both Owner and Tenant satisfaction.
No other real estate company can match our breadth of coverage across all market sectors throughout New Zealand.
Aiden He
Rents of Grade-A office buildings in Central and Admiralty have risen over 2 percent in May from a year ago, Knight Frank said.
Rental growth in the two areas outperformed others in the first five months of this year with a moderate rise of 0.4 percent due to strong demand for quality space in the central business district, the property consultancy said in a report.
Tenants continued to take the opportunity to seek Grade-A buildings for workplace upgrades at stabilized rent last month and some sizable companies have created strong leasing demand for co-working space for greater flexibility, said the report.
Fuelled by the popularity of flexible and remote work arrangements, it expects more sizable firms to move into co-working spaces, making this a trend to watch in the next 12 months.
Despite bottoming-out signals in prime locations, rents in decentralized locations are still under pressure, with a high vacancy rate, Knight Frank said. North Point’s vacancy rate rose to 12 percent, and Wong Chuk Hang’s stood at 11.1 percent in May.
It expects overall Hong Kong Island office rents to rebound in the second half, with rental growth of 5 to 10 percent for Grade A offices in 2022 due to the stabilized pandemic situation and recovering economic sentiment.
KANNAPOLIS, N.C. (WBTV) – Private investment continues in the City. Several projects are under construction with others expected to begin soon. Pennant Square Townhomes, located off of S. Main Street, now has three models open and over 40 units have presold.
Stadium Lofts is underway on West Avenue. It will have a restaurant, Towel City Tavern, on the first floor, along with the Kannapolis Cannon Ballers offices and an expanded team store. The structure will also have apartments that will overlook Atrium Health Ballpark. It should open in late 2023.
The former Swanee Theatre is being converted to a live music venue. Plans call for it to open this Fall.
Three major projects along I-85 are also moving forward. Metro 63 is being constructed on Lane Street off I-85. Trammell Crow Company is building this new 755,928 square foot Class A facility. The facility is being built to house a wide variety of logistic firms. It should be completed by 2023.
Lakeshore Corporate Park, will be built on the site of the former Intimidators stadium. Construction will start this summer with the expectation of a company moving in within the two years.
Water and sewer infrastructure is almost complete for the Kannapolis Crossing development. Kannapolis Crossing is at Exit 65 and will include houses, restaurants, businesses, offices and more.
Copyright 2022 WBTV. All rights reserved.
Buying a home is a high-stakes game. But many first-time buyers do not realise the significant financial and legal obligations they are bound to once they sign an Offer to Purchase (OTP).
“Many buyers look to real estate agents as their first point of contact to provide them with guidance and information as they traverse the road to homeownership,” said Jackie Smith, head of Buyers Trust, a subsidiary of Ooba Group.
Smith said that estate agents in South Africa are committed to the interests of both the buyer and seller. However, buyers must be responsible and educate themselves on the financial and legal implications that come with signing an OTP.
“OTPs are legally binding and massively expensive for you as a buyer should you try to back out from the deal after signing. Therefore, you must ensure that you are adequately informed and prepared for the decision you’re about to make. Here is a set of questions with will assist you with the decision-making required,” Smith said.
Question 1: Have you calculated your long-term affordability?
Buying a home is a long-term financial commitment, with the most common bond repayment period being 20 years.
“Buyers must think long-term: Are you able to afford the costs that come with buying a property? Will you be able to comfortably afford your repayments every month? Can you still afford the property when there are interest rate increases? Will you still be able to afford the payments in the case of an unexpected life event?” Smith said.
The general rule of thumb is to not spend more than 30% of your gross salary on a bond repayment each month – even if you get approved for a larger bond. This percentage considers possible interest rate hikes and leaves room for living expenses.
“Long-term affordability is the most important issue to consider,” said Smith. “If a potential buyer cannot afford to finance the purchase of the property at a particular price-point long-term, it would be irresponsible for them to go further.”
Question 2: Do you have a deposit and where would you like it to be kept?
There are many benefits to putting down a deposit – Typically around 10% of the purchase price. Having a deposit will reduce the monthly bond repayment amount and can help you to negotiate a lower interest rate with the bank as you have proven your ability to contribute to the total cost of the property.
“It also helps buyers to stand out from the competition when multiple buyers are vying for the same home,” noted Smith
Once you have decided to put down a deposit, you must decide how you would like it to be managed as you have multiple options to choose from.
These options include:
- Paying the deposit into the transferring attorney’s trust account.
- Paying the deposit into the estate agent’s trust account.
- Having a guarantee issued by a secure third-party like Buyers Trust.
“Many estate agents prefer not to manage buyer’s deposits because of the extra admin associated with it and the need to up their security to protect the deposit from cybercrimes such as phishing,” said Smith.
“Thus, buyers should be aware of the third-party alternatives available when it comes to managing the deposit, such as the service offered by Buyers Trust.”
Under Buyers Trust, you receive a competitive return on your investment and deposits are kept safe through the highest level of security measures. A buyer has 100% visibility of their deposit at all times and a free guarantee is issued to the transferring attorney.
Question 3: Do you have money set aside for the extra costs involved?
You as the buyer are responsible for the legal fees of the conveyancer, as well as paying the transfer duty to SARS.
In addition to these costs, you must factor in rates payable to the municipality, fees to the relevant banks and administrative costs incurred in the filing of paperwork.
As an example, here are the extra fees on a R1,500,000 freehold home calculated using Ooba’s transfer cost calculator:
- Bond registration cost (incl VAT): R29,394
- Bank initiation fee (incl VAT): R6,038
- Deeds office fees: R1,371
- Post, petties, FICA other fees (incl VAT): R1,400
Total bond registration cost = R38,203
- Property transfer costs (incl VAT): R29,394
- Transfer duty: R18,750
- Deeds office fees: R1,371
- Post, petties, FICA and other fees (incl VAT): R1,400
Total transfer cost = R50,915
Total extra costs: R89,118
“For more expensive properties. the extra costs involved in buying a home can be more than R100,000,” said Smith. “Given that buyers are legally required to pay these fees once the OTP is signed, it’s crucial that your estate agent sits down with you to make sure that you understand the total costs involved in the homebuying process.”
Question 4: Do you understand the terms of the OTP?
Finally, the somewhat obvious question a buyer should ask themselves before signing a legally binding OTP – do you understand what you’re agreeing to?
As a buyer, your estate agent will be able to explain the OTP carefully to you so you understand what you are going to agree to before you sign. “Pay close attention to the section in every agreement that lists fixtures (attached to the property, such as ceiling fans) that are excluded and chattels (not permanently attached, such as appliances) that are included,” said Smith.
Smith recommends that buyers inspect the property carefully before making an offer. “If you discover significant issues only after the OTP has been signed, you’re potentially stuck with a less-than-desirable property.”
“Finally, your estate agent will be able to help you to stipulate any conditions in the OTP that need to be fulfilled before you can complete the transaction. These could include the sale of your current home, or that the purchase is subject to your bond application being approved. This gives you time to acquire the necessary funding,” she said.
Read: Good news for home loans in South Africa – banks are still lending
Home sellers are increasingly cutting their asking prices as buyers, constrained by higher mortgage rates and overall inflation, have become less willing to jump into the housing market at any cost.
The growing number of price cuts, a trend showing up in data from across the nation, is one of the strongest signs yet that the previously red-hot market, fueled by low mortgage rates and all-cash bidding wars, is cooling.
The price reductions don’t mean overall home values are dropping. In the wider U.S., they make up a minority of listings, and most homes still sell for more than the list price.
Industry experts, for now, do not see a plunge coming in the housing market, catapulted to record-high prices in the first two years of the pandemic as many people sought out more space and had new savings to spend.
Values could come down modestly, some experts said, if the Federal Reserve’s actions to tame inflation send mortgage interest rates significantly higher — or tip the economy into recession.
For buyers, the market already feels significantly different from the frenzied competition of several months ago.
“The market is not the same as it was a month ago even,” said Lindsay Katz, a Los Angeles agent at Redfin, the brokerage company.
On Covello Street in the Van Nuys neighborhood of Los Angeles, the owner of a four-bedroom house recently cut the price by $50,000 to $949,900 after the 1950s tract home sat on the market for three weeks.
Other homes in the area are listing even bigger price reductions: a $78,000 cut for a two-bedroom home, and a house with an accessory dwelling unit first listed at $1 million now for sale at $860,000 — a $140,000 price cut.
Katz doesn’t represent the Van Nuys listings, but similarly had to recently cut the price on a four-bedroom home in the Woodland Hills neighborhood by $40,000.
The explanation for the dramatic shift is simple, according to real estate experts. Mortgage interest rates have shot up in recent months, quickly making housing much more expensive.
Monthly mortgage payments for a same-priced home are now hundreds of dollars — sometimes upward of $1,000 — more than what they were at the beginning of the year, when rates were in the 3% range.
The change has placed some buyers in entirely new price brackets and priced others out altogether.
“I have buyers who are now kind of at a standstill,” said Yolanda Cortez, an L.A. area agent at Century 21 Realty Masters.
Some were already looking at homes in the L.A. area at the top end of their budget.
But after interest rates rose, Cortez said, they can now afford only a house in the Antelope or Victor valleys, high-desert communities more than 60 miles from downtown Los Angeles, a nonstarter “because they work in the L.A. area.”
As a result, fewer homes are going into escrow, inventory is rising and sellers are starting to react.
The share of homes listed for sale that took recent price cuts has more than doubled since last year. During the four weeks that ended June 5, 16.2% of listings in L.A. County had at least one price cut, up from 7.5% during the same period last year, Redfin data show.
In Orange, Riverside and San Bernardino counties the share of price drops rose to more than 20% of listings, up from about 7% a year earlier.
Nationwide, there haven’t been this many price cuts since 2019. Homes for sale in Los Angeles and Orange Counties haven’t seen this number of price reductions since late 2018 — the last time mortgage rates shot up. In the Inland Empire, price reductions are at an all-time high in a dataset that started in 2015.
Despite the slowdown, agents say that there are still many eager buyers and that the number of homes for sale remains well below pre-pandemic levels, with bidding wars still breaking out for the best properties.
Tregg Rustad, an agent at Rodeo Realty, said that two weeks ago his client submitted an offer on a Silver Lake house that was hundreds of thousands of dollars above the asking price.
“The buyer didn’t get it,” he said, noting he’s seen similar bidding wars in Santa Monica and Hancock Park.
Still, there has been a marked shift in the environment for would-be home buyers, and other changes are afoot as price cuts become more common.
In the last two years, many sellers ignored offers unless buyers waived certain contingencies, particularly the appraisal contingency that allows a buyer to walk away if an appraisal comes in low.
Now, buyers can leave those contingencies in place and have their offers taken seriously, said real estate agent Derek Oie, founder of Movement Real Estate in the Inland Empire.
Buyers “are not in the driver’s seat,” Oie said. “But they are not being dictated to anymore.”
Carl Izbicki, a real estate agent at RE/MAX Estate Properties in Los Angeles, said homes that used to get about 15 to 25 offers now get three to five.
When the market was on fire, one of Izbicki’s clients, a couple, lost out on about eight homes despite bidding well above the asking price. Last week, Izbicki sent them a list of properties that have been on the market for more than 30 days.
“If they like one of these homes, we are going to offer less,” he said.
In an interview a few days later, Izbicki said the couple did just that, offering about $40,000 less than the asking price on a three-bedroom home in Van Nuys listed at $789,000. They are waiting to hear back.
Michael Simonsen, founder of real estate data firm Altos Research, said that though some buyers are now priced out, others probably have paused their searches for other reasons.
As inventory rises, even those who can still buy are choosing not to, creating somewhat of a self-fulfilling slowdown prophecy.
“Buyers know they can wait maybe until the summer and have more selection,” Simonsen said.
Despite the increased prevalence of price cuts, many analysts don’t predict the actual value of Southern California homes to fall soon — absent a recession.
After accounting for price reductions, most sellers are still listing their homes at higher prices than a year ago, and on average, homes are still selling for above the list price, said Taylor Marr, a Redfin economist.
In Los Angeles County, the initial median list price — the price at first listing — for the four weeks that ended June 5 was 9% higher than it was in the same period last year, while the average price drop — which occurs on a growing but still minority number of listings — was 5%, according to Redfin.
Experts said some of the recent price cuts probably came from overeager sellers who priced their properties way over market value to take advantage of what until recently was a very hot market.
Further guarding against value declines, homeowners who don’t need to sell may choose not to in a softening market.
Izbicki, for example, just dropped the price on a two-bedroom condo in Palms by $24,000. If no one offers close to the new list price of $824,000, he said his client plans to rent it out instead.
Many analysts predict home prices will keep rising this year, but by a smaller percentage than they are rising now.
One of the more downbeat forecasts comes from John Burns Real Estate Consulting, which last month predicted that by December 2022, Southern California home prices will have risen by the mid-single digits compared with a year earlier, a marked slowdown from the roughly 20% gain in May.
The consulting firm predicted home prices would then decline by the mid-single digits in both 2023 and 2024 as the Fed’s efforts to fight inflation push the economy into recession.
Rick Palacios Jr., director of research at John Burns Real Estate Consulting, said the research firm is debating whether to adjust its forecast downward because of the jump by mortgage rates above 6%.
Already, “there are not a ton of buyers,” said Heather Presha, a Keller Williams agent who specializes in South L.A. “I wouldn’t be surprised that by the end of the year we are kind of midway to a buyer’s market.”
Home sellers are increasingly cutting their asking prices as buyers, constrained by higher mortgage rates and overall inflation, have become less willing to jump into the housing market at any cost.
The growing number of price cuts, a trend showing up in data from across the nation, is one of the strongest signs yet that the previously red-hot market, fueled by low mortgage rates and all-cash bidding wars, is cooling.
The price reductions don’t mean overall home values are dropping. In the wider U.S., they make up a minority of listings, and most homes still sell for more than the list price.
Industry experts, for now, do not see a plunge coming in the housing market, catapulted to record-high prices in the first two years of the pandemic as many people sought out more space and had new savings to spend.
Values could come down modestly, some experts said, if the Federal Reserve’s actions to tame inflation send mortgage interest rates significantly higher — or tip the economy into recession.
For buyers, the market already feels significantly different from the frenzied competition of several months ago.
“The market is not the same as it was a month ago even,” said Lindsay Katz, a Los Angeles agent at Redfin, the brokerage company.
On Covello Street in the Van Nuys neighborhood of Los Angeles, the owner of a four-bedroom house recently cut the price by $50,000 to $949,900 after the 1950s tract home sat on the market for three weeks.
Other homes in the area are listing even bigger price reductions: a $78,000 cut for a two-bedroom home, and a house with an accessory dwelling unit first listed at $1 million now for sale at $860,000 — a $140,000 price cut.
Katz doesn’t represent the Van Nuys listings, but similarly had to recently cut the price on a four-bedroom home in the Woodland Hills neighborhood by $40,000.
The explanation for the dramatic shift is simple, according to real estate experts. Mortgage interest rates have shot up in recent months, quickly making housing much more expensive.
Monthly mortgage payments for a same-priced home are now hundreds of dollars — sometimes upward of $1,000 — more than what they were at the beginning of the year, when rates were in the 3% range.
The change has placed some buyers in entirely new price brackets and priced others out altogether.
“I have buyers who are now kind of at a standstill,” said Yolanda Cortez, an L.A. area agent at Century 21 Realty Masters.
Some were already looking at homes in the L.A. area at the top end of their budget.
But after interest rates rose, Cortez said, they can now afford only a house in the Antelope or Victor valleys, high-desert communities more than 60 miles from downtown Los Angeles, a nonstarter “because they work in the L.A. area.”
As a result, fewer homes are going into escrow, inventory is rising and sellers are starting to react.
The share of homes listed for sale that took recent price cuts has more than doubled since last year. During the four weeks that ended June 5, 16.2% of listings in L.A. County had at least one price cut, up from 7.5% during the same period last year, Redfin data show.
In Orange, Riverside and San Bernardino counties the share of price drops rose to more than 20% of listings, up from about 7% a year earlier.
Nationwide, there haven’t been this many price cuts since 2019. Homes for sale in Los Angeles and Orange Counties haven’t seen this number of price reductions since late 2018 — the last time mortgage rates shot up. In the Inland Empire, price reductions are at an all-time high in a dataset that started in 2015.
Despite the slowdown, agents say that there are still many eager buyers and that the number of homes for sale remains well below pre-pandemic levels, with bidding wars still breaking out for the best properties.
Tregg Rustad, an agent at Rodeo Realty, said that two weeks ago his client submitted an offer on a Silver Lake house that was hundreds of thousands of dollars above the asking price.
“The buyer didn’t get it,” he said, noting he’s seen similar bidding wars in Santa Monica and Hancock Park.
Still, there has been a marked shift in the environment for would-be home buyers, and other changes are afoot as price cuts become more common.
In the last two years, many sellers ignored offers unless buyers waived certain contingencies, particularly the appraisal contingency that allows a buyer to walk away if an appraisal comes in low.
Now, buyers can leave those contingencies in place and have their offers taken seriously, said real estate agent Derek Oie, founder of Movement Real Estate in the Inland Empire.
Buyers “are not in the driver’s seat,” Oie said. “But they are not being dictated to anymore.”
Carl Izbicki, a real estate agent at RE/MAX Estate Properties in Los Angeles, said homes that used to get about 15 to 25 offers now get three to five.
When the market was on fire, one of Izbicki’s clients, a couple, lost out on about eight homes despite bidding well above the asking price. Last week, Izbicki sent them a list of properties that have been on the market for more than 30 days.
“If they like one of these homes, we are going to offer less,” he said.
In an interview a few days later, Izbicki said the couple did just that, offering about $40,000 less than the asking price on a three-bedroom home in Van Nuys listed at $789,000. They are waiting to hear back.
Michael Simonsen, founder of real estate data firm Altos Research, said that though some buyers are now priced out, others probably have paused their searches for other reasons.
As inventory rises, even those who can still buy are choosing not to, creating somewhat of a self-fulfilling slowdown prophecy.
“Buyers know they can wait maybe until the summer and have more selection,” Simonsen said.
Despite the increased prevalence of price cuts, many analysts don’t predict the actual value of Southern California homes to fall soon — absent a recession.
After accounting for price reductions, most sellers are still listing their homes at higher prices than a year ago, and on average, homes are still selling for above the list price, said Taylor Marr, a Redfin economist.
In Los Angeles County, the initial median list price — the price at first listing — for the four weeks that ended June 5 was 9% higher than it was in the same period last year, while the average price drop — which occurs on a growing but still minority number of listings — was 5%, according to Redfin.
Experts said some of the recent price cuts probably came from overeager sellers who priced their properties way over market value to take advantage of what until recently was a very hot market.
Further guarding against value declines, homeowners who don’t need to sell may choose not to in a softening market.
Izbicki, for example, just dropped the price on a two-bedroom condo in Palms by $24,000. If no one offers close to the new list price of $824,000, he said his client plans to rent it out instead.
Many analysts predict home prices will keep rising this year, but by a smaller percentage than they are rising now.
One of the more downbeat forecasts comes from John Burns Real Estate Consulting, which last month predicted that by December 2022, Southern California home prices will have risen by the mid-single digits compared with a year earlier, a marked slowdown from the roughly 20% gain in May.
The consulting firm predicted home prices would then decline by the mid-single digits in both 2023 and 2024 as the Fed’s efforts to fight inflation push the economy into recession.
Rick Palacios Jr., director of research at John Burns Real Estate Consulting, said the research firm is debating whether to adjust its forecast downward because of the jump by mortgage rates above 6%.
Already, “there are not a ton of buyers,” said Heather Presha, a Keller Williams agent who specializes in South L.A. “I wouldn’t be surprised that by the end of the year we are kind of midway to a buyer’s market.”
After moving to Imperial Beach from Denver, Colorado last November, a dad and two of his sons saw a need for a bike rental store in town and decided to open one to fill the need. IB Rents has been in business for two months now. CJ Eatherton along with 18-year-old Caden and 23-year-old Cody are partners in the new business and working well together splitting their duties.
The family of five was very familiar with the area before moving, having vacationed in Coronado for 14 years. The Eathertons discovered Imperial Beach one year when they rented a house in Imperial Beach on Fifth Street. “We fell in love with the area, it grows on you,” said Caden Eatherton. “We wanted to open a business and saw that there were no bike shops around. We always came to Imperial Beach looking for bikes.”
CJ Eatherton started some market research and was also interested in offering e-bike rentals. IB Rents has two models of RAD Power Bikes, Runner 2 and Mission, in addition to beach cruisers. The shop also does repairs for all kinds of bikes and has a three to five day turnaround.
CJ Eatherton, who is still working full time at his job selling A/C units to hotels and large buildings splits his time and fixes bikes on the weekends. While he is the main bike repairman, he is teaching his two kids as well. “With a family of five I was always fixing bicycles. Then I had an opportunity to buy a handful of bicycles and sell them on Coronado marketplace when we came here from Colorado,” he said. When the idea of moving came about the family was onboard. “The boys were thinking of getting out of the snow,” he said. Eatherton has another son,Ty, who is a teacher.
While in business a short while, the word of the new store is spreading, said Eatherton, especially through the Chamber of Commerce. Now the local hotels are also sending their guests over if they ask for rentals – which is giving the store an influx of customers.
Both locals and visitors are heading to the store for rentals, and IB Rents has been doing a lot of repairs for locals. CJ Eatherton likes working with his kids. “Working with my kids has been good. They help with social media. Cody does the inventory and Caden is at the front desk,” he said.
In addition to renting bikes for all ages and accessories like kids seat, locks and helmets, the store sells beach items – towels, sunscreen, buckets, shovels, boogie boards, skateboards and bike accessories.
The family has settled in Imperial Beach near the estuary. “It’s a neat little town and it’s busy and getting busier,” said CJ Eatherton. “We fell in love with the city.”
Imperial Beach is getting more crowded now that summer is here, and CJ Eatherton said the store has taken a lot of reservations for July starting before the 4th. He recommends calling to reserve bikes ahead of time.
Customer Tim Varley stopped by to check on an e-bike repair. He has taken his kids’ e-bikes to IB Rents before for repairs and has been impressed with how quick the turnaround is. “He is a very nice guy,” he said of CJ Eatherton.
E-bike rentals start at $30, beach cruisers at $15 and kids cruisers at $10. Multi day and weekly rates are available, a military discount of 20% is offered. E-bike riders must be 16 years or older to operate.
IB Rents is located at 235 Palm Avenue. Call (619) 227-7734 or log on www.ibrents.com. Follow the store’s social media on Facebook and instagram.
Vol. 38, No. 25 – Thursday, June 23, 2022
A PAIR of estate agents took going the extra mile to extreme lengths when they jetted and drove close to 3,000 miles to ensure an elderly couple’s move made it over the line.
In a race against time, employees at the Ross Nicholas branch in Highcliffe flew to Spain and back in one day to secure a vital signature, driving hundreds more miles between locations and finally dropping off documents after an overnight trek to Newcastle.
The team pulled out the stops to ensure Arthur Faulkner and his wife, Margaret, who has Alzheimer’s, could relocate about two-and-a-half miles from Mudeford to Highcliffe.
Branch manager George Gosling said: “It was nothing about us losing our fees, or anything. We just couldn’t let our clients down. They are such a lovely couple and so badly needed this move.
“The mad thing was that in this day and age although all other documents could be signed online, the solicitor for this house sale still wanted the original signed paper document.”
The mission began on 9th June when he flew from Bristol to Murcia at 9am before driving another 125 miles to the villa of one of the vendors in the chain, which was hours away from collapsing.
Once the documents were signed, George drove another 137 miles to Alicante, getting on a plane at midnight.
When he touched down in Bristol at 2am he handed over to sales manager Ross Croucher who drove through the night to get the paperwork up to Newcastle by 9am.
Ross said: “We had a 48-hour window – if we didn’t get the documents signed, the whole deal would collapse.
“Our clients, Mr and Mrs Faulkner, are two people in their eighties and the husband is a full-time carer for his wife. They had been waiting months to downsize to a place with no stairs as it was safer for her.
“But they were in a chain which, if this man in Spain did not sign papers in time, would have collapsed – but he couldn’t get back to England.
“So we decided to go out to Spain ourselves then take the documents to Newcastle.”
The Faulkners, who have been married for 63 years and are both 83, were delighted at the service.
Retired butcher Arthur was full of praise for the estate agents, saying: “I have no idea what we would have done if the sale had fallen through. I need my wife to be somewhere safe.
“What George and Ross did is above and beyond. They were just amazing. I will never be able to thank them enough.
“It is unbelievable what they did. It shows just how much they care about people rather than just houses and fees.
“They knew our situation and they really wanted to help. They totally came to our rescue and saved the day.”
He is now planning to treat the estate agents to a bottle of champagne and a fish and chip dinner.
He said: “I cannot wait to welcome them to our new home.
“It was thanks to them that we have it and for me and Margaret it will be such an improvement to our lives.”
WATERTOWN — The housing market recently saw an increase in mortgage rates that hadn’t been seen since the mid-1990s.
USA Today reported June 15 that the federal government increased mortgage rates by three-quarters of a percentage point, the largest such increase since 1994.
Lance M. Evans, executive officer of the Jefferson-Lewis Board of Realtors and the St. Lawrence County Board of Realtors says that people who have been pre-approved for a loan should check with their lender to ensure that the pre-approval amount has not changed after the interest rate increase. He also says that people who have already been locked in on a given rate should ensure that all documents are in to make sure they can make a purchase at that rate.
Lawrence Yun, chief economist for the National Association of Realtors, said in a prepared statement that he expects more increases to come.
“So far, the short-term fed funds rate that the Fed directly controls has risen by 175 basis points,” he said. “But the 30-year fixed rate mortgage has risen even more — by nearly 300 basis points.”
Mr. Yun goes on to say that the payment on a $300,000 mortgage has risen from $1,265 in December to $1,800 now.
“That’s painful and, consequently, will shrink the buyer pool,” he wrote.
The Wall Street Journal reported at the end of May that the S&P CoreLogic Case-Shiller National Home Price Index, which measures the average home prices in major metropolitan areas throughout the United States, rose 20.6% in the year that ended in March. This is up 20% from the yearly rate from the month before and was the biggest annual rate of price growth since 1987, when the index began. The Journal also reports that the inventory of homes on the market nationwide in March was at a below average level, making it “difficult for buyers to compete and pushing prices higher.”
In the north country, generally more properties were sold faster and for a higher median price during the period. However, as of data that ended on May 31, there were fewer properties on the market than the year prior.
In Jefferson County, for the year June 1, 2021, to May 31, 2022, there were 1,994 properties sold, up from 1,926 the year prior. The properties were on the market for about a month less than last year, and the median price is $170,000, up $15,100 from the year prior.
For single-family homes in Jefferson County, 1,580 properties were sold, up 39 from the previous year. The average single-family home was on the market for 46 days, a decrease of 39 days and the median price was $186,750, an increase of $17,750. Houses on the market at the end of May dropped to 376 in 2022 — a 100-house decrease from 2021.
Lewis County saw 364 properties sold during the same time period, which is five less than the year prior. Properties were on the market for an average 79 days, an 80-day difference from the previous year, and the median price of a home was $129,410, a $21,410 difference from the year prior.
Single-family houses in Lewis County saw a decrease of 26 homes sold from the year prior. Houses were on the market for an average 67 days, a 47-day decrease, and the median price was $148,000, an $11,500 increase. Single-family houses on the market at the end of May dropped down to 63 — a 30-house decrease from 2021.
St. Lawrence County saw 1,145 properties sold during the same time period, a 76-property increase from the prior year. The average property was on the market for 124 days, a difference of 57 days, and the average price was $109,000, which is an increase of $16,500 from the year prior.
For single-family homes in St. Lawrence County, there were 931 homes sold in that period, an increase of 40 from the prior year. Homes spent an average 97 days on the market, a 57-day decrease, and the median price of a home was $124,900, a $14,900 increase. There were 234 houses on the market at the end of May, a decrease of 144 from the year prior.
Mr. Evans said that in 2008, even though the nation was going through a recession, the north country housing market “stayed pretty stable.”
“During the recession a few years back that they had nationwide, our housing stayed pretty stable for sales and all that sort of thing when everyone else was plunging,” he said. “For a variety of reasons … one is that we had of course, enough people going and out through Fort Drum and everything else that people were still selling and, of course, buying.”
Shelby L. Morgia, a loan officer with Watertown Savings Bank, said that the interest rate hike hasn’t hit as hard as thought.
“Overall, any time the interest rate increases it means the borrower’s payment is more,” she said. “So therefore, their affordability goes down.”
She said the interest rate increased earlier this month as a way to combat inflation, and that when inflation gets “in check,” or begins to go down, the public could see interest rates begin to plateau. But that might not be until the end of the year, or the first or second quarter of next year.
The average rates in the area are between 5.25% and 6%.
There are many things that presumptive homebuyers should do, Ms. Morgia said.
“I think they need to do their homework,” she said. “I think they need to get with someone they can talk to, someone they can trust, someone that can run them some scenarios, someone that they can have an open conversation with, so that if they decide now is the time, they are well-informed to jump in the pool, so to speak.”
Ms. Morgia said that she wouldn’t be surprised to see at least one more increase.
“The affordability is becoming an issue,” said Amanda J. Miller, owner of Lake Ontario Realty LLC, Chaumont.
She also said that the interest rate hike is resulting in some sellers trying to hurry up and get their houses sold.
Ms. Miller predicted that the housing market should still be strong through the end of the year, saying that because of the trickle-down effect it will take some time to impact all of the homebuyers in the market.
If the economy isn’t performing well next year, Ms. Miller predicts that more homeowners will sell.
“That’s what could potentially even out the marketplace again,” she said.
She doesn’t believe now is a good time to buy.
“I’ve told people if you don’t have to buy, the last two years, it’s probably best to have other options, but if you have to buy, you know you have to buy,” she said.
Despite the recent hike, Ms. Miller says that rates are not going back to where they were in the 1980s, when they were at closer to 18% to 20%.
“Although it’s a shock, it’s certainly nothing surprising, and it’s nothing crazy,” she said.