A 227-acre waterfront oasis on a huge private lake in the suburbs of Houston is headed to auction in August with a reserve that’s a fraction of its current asking price.
The home in Magnolia—roughly an hour’s drive northwest from Houston—has been on the market for $19.8 million since June, and will be offered with a $7.49 million reserve when bidding opens online on Aug. 8 through Concierge Auctions. The sale, which will close on Aug. 22, is being handled in cooperation with Lisa Carswell of Carswell Real Estate.
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Emerald Lake Estate, as it’s known, has a laundry-list of outdoor features. From a 9-acre Japanese garden and a 7-acre botanical garden with over 5,000 azaleas, to the miles of walking trails and the sprawling lake that gives the property its name, which is stocked with bass and crisscrossed by 21 bridges that connect to its 10 different islands.
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“This is that rare property that brings with it a slice of natural paradise to enjoy far beyond the four walls of the home itself,” Carswell said. “Lakeside living is already so sought-after for the lifestyle it enables, but in this case, owners have a chance to own Emerald Lake and its beautifully sculpted grounds.”
Inside, the Mediterranean-style primary residence has high ceilings, walls of windows overlooking the picturesque surroundings, and an open-plan living, kitchen and dining area. Plus there are three bedrooms, a wine room and a game room, according to the listing.
There’s also a guest house, a covered boathouse and a private helipad.
Listing records show the home last changed hands in 2017. Texas is a non-disclosure state, so there’s no record of how much the owner—a limited liability company, according to PropertyShark—paid.
Microsoft is to invest 2.2 billion euros ($2.4 billion) in a huge data centre project in northeastern Spain, regional authorities said Wednesday as the area seeks to establish itself as a cloud storage hotspot.
The announcement, which follows other plans unveiled by the US software giant, raises to nearly 6.7 billion euros Microsoft’s planned investment in Aragon, regional leader Jorge Azcon told reporters.
It also follows a similar announcement by Amazon which in May said its cloud computing division would invest 15.7 billion euros to expand its data centres in Aragon, where it currently has three operating.
“This is great news for the Aragonese economy,” said Azcon, highlighting the economic benefits expected from this investment which he believes will have “a knock-on effect” in attracting other companies.
Microsoft had in October announced its intention to build a data centre campus in Aragon to provide “cloud services to European companies and public bodies” without saying how much investment that would entail.
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Citing figures provided by the IDC consultancy, Microsoft said the project with its 88-hectare (217-acre) campus could “contribute to the creation of more than 2,100 technology jobs in Aragon between 2026 and 2030”.
“Data centres will undoubtedly play a fundamental role as the first link in the chain… that will generate investment, innovation and a wider range of digital services in our community,” Azcon said.
For months now, big tech has been increasing its investment in data centres, where servers are housed to store the huge amounts of information used by both companies and individuals.
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This growth is in line with the needs driven by the demand to develop generative artificial intelligence which requires locations with a robust electrical capacity because these data farms consume a vast amount of energy.
In that respect, Aragon is an ideal location given it is a sparsely populated region with ample sunshine and strong wind exposure that is home to both solar and wind farms, and well connected to Spain’s communications networks.
In New Jersey’s Bergen County community of Alpine, the population is small (around 1,700), but the estates are grand.
Only 15 miles from New York City, the residential enclave is perfectly positioned geographically for those who desire big-city amenities and small-town advantages.
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Upscale Alpine offers a “refined” yet “friendly and welcoming ambience,” said Dennis McCormack, a real estate agent at Prominent Properties Sotheby’s International Realty.
With its casual vibe, Alpine makes itself right at home: It’s the kind of place where people walk their dogs or ride their bikes.
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“While residents do value their privacy,” said Taryn Byron, an agent at Corcoran Infinity Properties, “of course, it is a friendly neighborhood.”
Boundaries
Alpine is across the Hudson River from the Bronx and Westchester County’s Yonkers and Hastings-on-Hudson. It borders the New Jersey boroughs of Closter, Cresskill, Demarest, Norwood, Rockleigh and Tenafly.
The most exclusive section of Alpine is Rio Vista, the four streets just off Sylvan Avenue (Route 9W): the Esplanade, Rio Vista Drive, Stone Tower Drive and Tulip Tree Lane.
Price Range
While the average sale price of a single-family home from June 2023 to June 2024 in the borough stands at $4.7 million, Byron noted that current listings range from $2.4 million to $24.5 million.
“Luxury homes in Alpine start at around $5 million,” she said, adding that that’s typically for a 7,500-square-foot house on 2 acres with a pool, a basketball or tennis court and a three- to four-car garage. “Prices can go well into the $20 millions and even up to $30 million.”
In 2023, a house on the Esplanade sold for $11.5 million, the highest sale price in Bergen County for the year, McCormack said.
Housing Stock
The estates in Alpine have custom houses in a variety of architectural styles ranging from contemporary and modern mansions to French chateaus, Neoclassical manors and English Country homes. Generally, they are 20 to 30 years old and are on 2-acre plots.
What Makes It Unique
McCormack said that “Rio Vista Drive stands out for its breathtaking beauty, lush landscapes and prestigious reputation.”
“Food, proximity to New York City, airports both international and private—you can really have it all living here and still maintain a nice balance of a small town with the excitement of the big city so close, and most importantly, privacy,” Byron said.
Luxury Amenities
The exclusively residential community is surrounded by neighboring towns that offer stellar dining and nightlife.
Fine-dining restaurants include the River Palm Terrace, a steakhouse in Edgewater; Sofia, a farm-to-table Italian steakhouse and lounge in Englewood; and Lefkes Estiatorio in Englewood Cliffs, which serves Mediterranean fare with a modern twist using local ingredients.
In addition to access to all the luxury-brand boutiques in New York City across the river, residents shop at several luxury malls that are close to Alpine. The Shops at Riverside is a shopping, dining and entertainment destination in Hackensack whose brand-name boutiques include Tory Burch and Tiffany & Co. Westfield Garden State Plaza in Paramus is anchored by Macy’s and Nordstrom. Closter Plaza, in Closter, has upscale shops and restaurants.
With more than 450 stores, American Dream Meadowlands, a retail and entertainment complex in the Meadowlands Sports Complex in East Rutherford, is the second-largest shopping mall in the country.
The Alpine Country Club offers dining, tennis and golf. The Alpine Marina, a full-service venue on the Hudson River, offers charters and tours and boat, ship and kayak rentals.
Montammy Golf Club, in Alpine, offers not only golf but also tennis and a 45,000-square-foot clubhouse.
The Rockleigh Equestrian Center, which offers boarding and riding lessons, is another nearby amenity.
For outdoor activities, residents go to the Palisades Interstate Park in Alpine, the Tenafly Nature Center and the Overpeck County Park in Leonia.
Residents have the choice of several nearby private schools. The Dwight-Englewood School, an independent co-ed college-preparatory day school in Englewood, enrolls students from pre-kindergarten through 12th grade. The Elisabeth Morrow School, a co-ed day school in Englewood, is for students from nursery school through eighth grade.
Bergen Catholic High School in Oradell is for boys in ninth through 12th grades. The Academy of the Holy Angels in Demarest educates young women in grades six through 12.
Who Lives There
Noting that Alpine is a “melting pot,” Byron said that the borough is home to native New Jerseyans as well as “a multitude of residents from other cultures and countries from all over the world.”
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McCormack added that “the neighborhood appeals to those seeking a luxurious and tranquil lifestyle, including affluent families, executives and professionals.”
Notable Residents
Comedian Chris Rock is a longtime resident of Alpine, according to published reports. Singer/songwriter Stevie Wonder, rapper Lil’ Kim and comedian Tracy Morgan are among the many other celebrities who live there, according to published reports.
Outlook
In Rio Vista Drive, “it’s a strong seller’s market, with high demand for luxury properties driving up prices,” McCormack said.
He noted that houses sell quickly, often within days of listing, and “bidding wars are common.”
Prices, he said, have risen by an average of 5% annually over the past five years. “The real estate market in Rio Vista Drive is expected to remain robust, with continued appreciation in property values. The neighborhood’s exclusive appeal and limited inventory contribute to its long-term investment potential.”
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Calling the luxury residential market in Alpine “stable,” Byron said that prices have increased over the last five years, with the average sold price rising from $2.5 million to $4.5 million since pre-pandemic days.
“The $2.5 million is now entry-level pricing for a home in need of work,” she said. “New homes are coming on the market at an average of $6 million and are selling, in an average of four to five months, for 93% of their asking price. This shows the strength of the New Jersey real estate market, even at the higher end.”
Annual home-price growth in the U.S. held at a fast clip in March, likely helped by gradually easing mortgage rates as Federal Reserve interest-rate cuts come into view.
The S&P CoreLogic Case-Shiller National Home Price Index, which measures home prices across the nation, rose 6.5% from a year earlier in March, the same as the prior month, according to data published on Tuesday.
“On a seasonal adjusted basis, national home prices have reached their ninth all-time high within the past year, with all 20 metropolitan markets posting positive annual gains for the fourth consecutive month, indicating widespread and sustained growth in the housing sector,” said Brian D. Luke, head of commodities, real & digital assets at S&P Dow Jones Indices.
The Case-Shiller 10-city index rose 8.2% on year in March, following a 8.1% increase in January. Meanwhile, the 20-city index rose 7.4%, a small uptick from the 7.3% in February, in the prior month. Economists surveyed by The Wall Street Journal expected the 20-city index to rise 7.3%.
San Diego posted the highest on-year increase in house prices, with an 11.1% annual gain, followed by New York, Cleveland and Los Angeles, indicating strong demand for urban markets, the data said.
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While the pandemic was a boon for Sunbelt markets, the bigger gains in the last couple of years have been the northern metro cities, with the Northeast region the top performer, Luke added.
The index, which measures repeat-sales data, reports on a two-month delay and reflects a three-month moving average. Homes usually go under contract a month or two before they close, so the March data is based on purchase decisions made earlier last year.
Write to Ed Frankl at edward.frankl@wsj.com
Honda announced plans Thursday to double investment in electric vehicles to $65 billion by 2030 as the Japanese auto giant seeks to go fully electric.
The company is aggressively pursuing a target set three years ago of achieving 100 percent EV sales by 2040.
In April, it announced the largest auto investment in Canada’s history with a new US$11 billion EV battery and vehicle assembly plant.
The company also has a partnership in EVs with Sony, and is exploring collaboration with rival Nissan as they face a “once-in-a-century” upheaval in the car industry.
Analysts have said the move is aimed at catching up with Chinese EV competitors as Beijing-backed automakers such as BYD speed ahead of global rivals.
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“Honda is planning to invest approximately 10 trillion yen in resources… through 2030, when the period of full-fledged popularisation of EVs is expected to start,” a statement said.
The automaker had previously allocated five trillion yen to EV tech in the medium-term.
Honda wants to “establish a competitive business structure with an aim to reduce overall production cost by approximately 35 percent”, it said Thursday.
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And “as of 2030, Honda will reduce the cost of the battery to be procured in North America by more than 20 percent compared to the cost of current batteries”.
By 2030 the company is aiming for electric vehicles and fuel-cell EVs to account for 40 percent of global sales.
The world’s auto giants are increasingly prioritising electric and hybrid vehicles, with demand growing for less polluting models as concern about climate change grows.
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At the same time, however, there has been a slowdown in the EV market on the back of consumer concern about high prices, reliability, range and a lack of charging points.
China overtook Japan as the world’s biggest vehicle exporter in 2023, helped by its dominance in electric cars.
When Honda released its earnings last week, it said it expected overall vehicle sales in the United States and Japan to grow this financial year, but predicted sales in the rest of Asia would ease.
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Honda plans to produce around two million EVs per year by 2030.
Its bigger rival Toyota aims to sell 1.5 million EVs annually by 2026 and 3.5 million by 2030.
Toyota is also hoping to mass-produce solid-state batteries, a potentially hugely important technological breakthrough that could mean faster charging times and greater range.
kaf/dan
Housing Prices Are Stuck Until We Beat Inflation
About the author: Susan Wachter is the Sussman professor of real estate and professor of finance at The Wharton School of the University of Pennsylvania and co-director of the Penn Institute for Urban Research. She is currently an advisory committee member of the Bureau of Economic Analysis of the Department of Commerce.
The U.S. Federal Reserve has been hoping for rent declines to slow inflation as measured by the consumer price index, where shelter costs make up more than 30% of the index. This hasn’t happened, and the evidence suggests that rents may now be on the increase. While housing has been a major channel for monetary policy to work to bring down inflation, this time around neither rent nor house-price declines are likely to assist.
Housing came to the Fed’s rescue in past episodes of inflation. Historically, the single-family, owner-occupied market has been the transmission vehicle for monetary policy. As the Fed tightened, higher mortgage rates dampened demand, causing declines in housing prices.
Not this time. Mortgage rates have doubled, but housing prices persist at all-time highs and affordability at 40-year lows. And while rents were falling, they are now moderating and, in many markets, rising. What happened?
The hope was that as pandemic bottlenecks resolved and housing supply increased, rents would decelerate. Rental supply in fact surged to more than 500,000 units a year in 2022 from a pre-Covid annual average of 300,000. Observers expected this would slow the pace of shelter costs, as accounted for in the CPI, with a lag. But markets have a mind of their own.
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Lags are due to the way shelter costs are measured in the CPI. Owners are asked to estimate their owners’ equivalent rent, what their home would rent for, at six-month intervals, and renters are asked for their contractual rent. In contrast, newly leased rental units reflect current market conditions, and existing rents take time to catch up. In this case, a helpful lagged effect of market rents on shelter costs was expected due to the supply surge. But that supply surge is currently being absorbed, while current rent and asset-price levels don’t justify new supply.
Rental prices had initially shot up starting in 2021 driven by economic stimulus, an overall recovery in aggregate demand, and the decision of many households and firms to move to the Sunbelt. Rents jumped by 10% in 2021-2022. This kicked off a wave of development. With the delivery of these new properties to market, vacancy increased and rent growth dropped below 2%.
With supply and vacancy growing and market rents decelerating, observers expected rents and OER rates to come down with a lag and lower the aggregate measured CPI inflation rate. The CPI data for May contained some good news: The overall rate of inflation decreased, in part due to declines in energy costs. Consumer prices increased 3.3% in May compared with a year earlier, slowing from April’s 3.4% reading. And for the first time since July 2022, the overall price level stayed flat from the month before. But shelter inflation increased at a rate of 5.4% on an annualized basis, more than offsetting the energy decline.
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Instead of continuing to decline, market measures of rent growth are now once again accelerating. Market rents are likely to move back to their long-term pattern of increasing faster than overall inflation. Since 1980, rents have increased at an average annual real rate of 1%. Rent increases vary by market, with rent softer in the Southeast and stronger in coastal markets (the Northeast and West), and by property type. Overall, recent rent-index numbers in the single-family rental market, which most closely mirrors the OER market, show rents increasing at about the same rate as the CPI year over year from April 2023 to April 2024, at 3.4%. Rent-growth rates had fallen to the 2%-3% range. The high-tier sector, which is disproportionately newly built, was in the lower part of that range. Rent growth fell less for low, low-middle, and high-middle market tiers.
But recently, all of these rent growth rates have trended upward. High interest rates and the Fed’s restrictive policies have decreased rental supply by pushing multifamily asset prices below construction costs. New multifamily housing starts fell back to about 300,000 units in 2024 and, with high housing prices discouraging moving homes, rent growth rates are reaccelerating.
In the owner-occupied space, the locked-in effect is part of the cause of low supply and persistently high prices, as high rates keep inventories low. Equally important are supply-side fundamentals. Construction costs are increasing faster than inflation due to scarcity of developable land, regulations, and labor costs. These cost increases also contribute to the lack of supply in the rental sector.
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The Fed can’t count on weak housing markets to dampen inflation, in the absence of a recession. But that doesn’t mean we’re stuck. Overall, it appears that inflation is once again falling. Economists widely expect the Fed to cut interest rates this year. That will help lower mortgage rates, and will make owner-occupied housing more affordable. Resulting inventory increases will help to meet demand.
Nonetheless, supply-side pressures will persist. Pent-up demand from millennials who have put off ownership will put upward pressure on prices as rates come down. Lower inflation and mortgage rates will help lower housing-finance costs, but we will also need to ease supply-side barriers to make housing more affordable.
Guest commentaries like this one are written by authors outside the Barron’s newsroom. They reflect the perspective and opinions of the authors. Submit commentary proposals and other feedback to ideas@barrons.com.
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