Category Archives: Housing

Appalachian Settlers and Their Dwellings

A short film about the Scotch-Irish and German settlers of Appalachia and the unique structures that they built. Narrated by author Katie Letcher Lyle.

China Home Sales Crash

Bloomberg cited a new report via China Merchants Securities (CMSC) that said new apartment sales crashed 90% in the first week of February over the same period last year. Sales of existing homes in 8 cities plunged 91% over the same period.

Wuhan, Hubei, China Sunrise

“The sector is bracing for a worse impact than the 2003 SARS pandemic,” said Bai Yanjun, an analyst at property-consulting firm China Index Holdings Ltd. “In 2003, the home market was on a cyclical rise. Now, it’s already reeling from an adjustment.”

Long before the coronavirus outbreak, China’s housing market has been on shaky grounds amid declining demand, stricter mortgage requirements, and price discounts.

The latest shock: two-thirds of China’s economy has come to a standstill, could generate enough pessimism to pop the country’s massive housing bubble. 

The CPC failed to stimulate the economy last year, with credit impulse not turning up as expected. The virus outbreak has allowed the CPC to scapegoat the slowdown and the inevitable crash.   

Real estate transactions have been forbidden in many cities. This means fire sales could be seen once selling restrictions end.  

E-House China Enterprise Holdings Ltd.’s research institute said four units per day were being sold in Beijing last week, and this is down from several hundred per day during the same period in the previous year. 

China International Capital Corp. analyst Eric Zhang said demand could pick back up in April, assuming the virus outbreak is under control. 

However, residents in major cities are frightened by the virus outbreak and how easily it spreads in apartment buildings

The downturn in China’s property market could get a lot worse, and without proper liquidity from the central bank, once selling restrictions end, it could trigger a liquidity gap where housing prices face a deep correction. 

But remember, the CPC can now blame the virus for a housing market crash or a downturn in the economy. 

Source: ZeroHedge

Why Manhattan’s Skyscrapers Are Empty

Approximately half of the luxury-condo units that have come onto the market in the past five years remain unsold.

In Manhattan, the homeless shelters are full, and the luxury skyscrapers are vacant.

Such is the tale of two cities within America’s largest metro. Even as 80,000 people sleep in New York City’s shelters or on its streets, Manhattan residents have watched skinny condominium skyscrapers rise across the island. These colossal stalagmites initially transformed not only the city’s skyline but also the real-estate market for new homes. From 2011 to 2019, the average price of a newly listed condo in New York soared from $1.15 million to $3.77 million.

But the bust is upon us. Today, nearly half of the Manhattan luxury-condo units that have come onto the market in the past five years are still unsold, according to The New York Times.

What happened? While real estate might seem like the world’s most local industry, these luxury condos weren’t exclusively built for locals. They were also made for foreigners with tens of millions of dollars to spare. Developers bet huge on foreign plutocrats—Russian oligarchs, Chinese moguls, Saudi royalty—looking to buy second (or seventh) homes.

But the Chinese economy slowed, while declining oil prices dampened the demand for pieds-à-terre among Russian and Middle Eastern zillionaires. It didn’t help that the Treasury Department cracked down on attempts to launder money through fancy real estate. Despite pressure from nervous lenders, developers have been reluctant to slash prices too suddenly or dramatically, lest the market suddenly clear and they leave millions on the table.

The confluence of cosmopolitan capital and terrible timing has done the impossible: It’s created a vacancy problem in a city where thousands of people are desperate to find places to live.

From any rational perspective, what New York needs isn’t glistening three-bedroom units, but more simple one- and two-bedroom apartments for New York’s many singlesroommates, and small families. Mayor Bill De Blasio made affordable housing a centerpiece of his administration. But progress here has been stalled by onerous zoning regulations, limited federal subsidies, construction delays, and blocked pro-tenant bills.

In the past decade, New York City real-estate prices have gone from merely obscene to downright macabre. From 2010 to 2019, the average sale price of homes doubled in many Brooklyn neighborhoods, including Prospect Heights and Williamsburg, according to the Times. Buyers there could consider themselves lucky: In Cobble Hill, the typical sales price tripled to $2.5 million in nine years.

This is not normal. And for middle-class families, particularly for the immigrants who give New York City so much of its dynamism, it has made living in Manhattan or gentrified Brooklyn practically impossible. No wonder, then, that the New York City area is losing about 300 residents every day. It adds up to what Michael Greenberg, writing for The New York Review of Books, called a new shameful form of housing discrimination—“bluelining.”

We speak nowadays with contrition of redlining, the mid-twentieth-century practice by banks of starving black neighborhoods of mortgages, home improvement loans, and investment of almost any sort. We may soon look with equal shame on what might come to be known as bluelining: the transfiguration of those same neighborhoods with a deluge of investment aimed at a wealthier class.

New York’s example is extreme—the squeezed middle class, shrink-wrapped into tiny bedrooms, beneath a canopy of empty sky palaces. But Manhattan reflects America’s national housing market, in at least three ways.

First, the typical new American single-family home has become surprisingly luxurious, if not quite so swank as Manhattan’s glassy spires. Newly built houses in the U.S. are among the largest in the world, and their size-per-resident has nearly doubled in the past 50 years. And the bathrooms have multiplied. In the early ’70s, 40 percent of new single-family houses had 1.5 bathrooms or fewer; today, just 4 percent do. The mansions of the ’70s would be the typical new homes of the 2020s.

Second, as the new houses have become more luxurious, homeownership itself has become a luxury. Young adults today are one-third less likely to own a home at this point in their lives than previous generations. Among young black Americans, homeownership has fallen to its lowest rate in more than 60 years.

Third, and most important, the most expensive housing markets, such as San Francisco and Los Angeles, haven’t built nearly enough homes for the middle class. As urban living has become too expensive for workers, many of them have either stayed away from the richest, densest cities or moved to the south and west, where land is cheaper. This is a huge loss, not only for individual workers, but also for these metros, because denser cities offer better matches between companies and workers, and thus are richer and more productive overall. Instead of growing as they grow richer, New York City, Los Angeles, and the Bay Area are all shrinking.

Across the country, the supply of housing hasn’t kept up with population growth. Single-family-home sales are stuck at 1996 levels, even though the United States has added 60 million people—or two Texases—since the mid-’90s. The undersupply of housing has become one of the most important stories in economics in the past decade. It explains why Americans are less likely to movewhy social mobility has declinedwhy regional inequality has increasedwhy entrepreneurship continues to fallwhy wealth inequality has skyrocketed, and why certain neighborhoods have higher poverty and worse health.

In 2010, one might have thought that the defining housing story of the century would be the real-estate bubble that plunged the U.S. economy into a recession. But the past decade has been defined by the juxtaposition of rampant luxury-home building with the cratering of middle-class-home construction. The future might restore a measure of sanity, both to New York’s housing crisis and America’s. But for now, the nation is bluelining itself to death.

Source: by Derek Thompson | The Atlantic

Sonoma County California Plans To Evict Renters To Buy Million Dollar Housing For Hobos

SANTA ROSA (KPIX) — A controversial plan to solve the homeless crisis has people fired up in Sonoma County where officials plan to spend millions of dollars to buy three properties that would be used to house the homeless.

All three properties have one thing in common. They’re big and have multiple units, but many of those units are currently occupied by tenants.

“I’m sure the tenants have been asked to leave,” said Allen Thomas.  He lives near one of the three properties, 811 Davis Street in Santa Rosa.

Neighbors said it’s counterproductive to evict renters to house the homeless.

“It’s just insanity,” said Karen Sanders, who also lives in Santa Rosa.

Sonoma County leaders plan to buy two properties in Santa Rosa and one in Cotati. They’ll spend roughly one million dollars for each property. One county worker said they’re already in contract to buy the property on Davis Street.

“Million dollar homes; million dollar homes for these transients living on the trail,” said Sanders.

The county wants to get the homeless out of an encampment on the Joe Rodota Trail. Many neighbors of those three properties worry the new neighbors will bring along crime and other quality of life issues.

“I’m not NIMBY, but we’ve done enough,” said Sher Ennis, a neighbor who lives near the Davis street property.

She said she was attacked in her home by a man from a re-entry housing program years ago.  She worries about her safety.

“We don’t know. Are we getting dangerous criminals? Are we getting felons? Or are we getting people who are simply down on their luck,” said Ennis.

Another neighbor supports the county’s plan.

“I don’t think that it makes [the neighborhood] any less safe, no,” said Andrew Atkinson.

He said the county has to act now.

“It’s going to take more than this, I think, to solve the problem. But I’m glad to see they’re trying,” said Atkinson.

Many upset neighbors voiced their concerns at a community meeting Friday night in Santa Rosa. County leaders will talk about the plan to buy the houses and other solutions to house the homeless.

Source: by Da Lin | KPIX CBS SF Bay Area

Los Angeles Homelessness Czar to Resign After Homelessness Grows by 33%

Los Angeles’ head of homelessness announced on Tuesday, December 10, 2019 that he will be resigning after presiding over a 33 percent increase in homelessness during the last five years.

Peter Lynn, the head of the Los Angeles Homeless Service Authority, revealed that he would leave at the end of the year.

According to Paul Joseph Watson of Summit News, LAHSA reportedly spent $780 million with no effect.

The city’s homeless population grew even larger from 2018 to 2019, where it witnessed a 12 percent increase in that period.

Even with these unsavory facts in front of him, L.A. Mayor Eric Garcetti believed he did an amazing job and presided over “historic action.”

Lynn was apparently making $242,000 while homelessness went up along with cases of leprosy, typhoid fever, and even bubonic plague.

A few months ago, Dr. Drew Pinsky said L.A.’s public health infrastructure was a complete mess.

Source: by Jose Nino | Big League Politics

NJ To Become Wasteland: 44% Of Residents Plan To Flee State

Thanks to the highest property taxes in the nation and an unsustainable cost of living, 44% of New Jersey residents plan to leave the state in the ‘no so distant future,’ according to a recent survey from the Garden State Initiative (GSI) and Fairleigh Dickenson University School of Public & Global Affairs.

Committing to a more solid time frame, 28% say they are planning to leave within five years, and 39% say they will do so over the next decade, according to Insider NJ.

Unsurprisingly, Property Taxes and the overall Cost of Living were cited as the main drivers. The results also debunk two issues frequently cited in anecdotal accounts of out migration, weather and public transportation, as they ranked 8th and 10th respectively, out of 11 factors offered.

The desire to leave the Garden State was reflected most strongly among young residents (18-29) with almost 40% anticipating leaving the state within the next five years. At the other end of the spectrum, a third (33%) of those nearing retirement (50-64) plan to leave within the next five years. –Insider NJ

These results should alarm every elected official and policymaker in New Jersey, said GSI’s president, former Chris Christie Chief of Staff Regina Egea. GSI focuses on providing “research-based answers to fiscal and economic issues” facing the state.

“We have a crisis of confidence in the ability of our leaders to address property taxes and the cost of living whether at the start of their career, in prime earning years, or re-positioning for retirement, New Jersey residents see greener pastures in other states.  This crisis presents a profound challenge to our state as we are faced with a generation of young residents looking elsewhere to build their careers, establish families and make investments like homeownership.”

After taxes and a high cost of living, government corruption and concerns about crime and drugs concerned citizens the most. Insider notes that there were no significant differences in responses across income levels.

Source: Garden State Initiative | ZeroHedge