Affordable housing by HW freeway

 

26-story senior affordable housing complex planned near Hollywood Freeway

It would rise at the corner of Fernwood and De Longpre

In an application submitted recently to the City of Los Angeles, ABS Properties proposes the construction of a new 26-story high-rise building which would replace the triangular surface parking lot located at 5645 W. Fernwood Avenue and 5636 De Longpre Avenue. The project, dubbed Skyvillage Hollywood, would feature a total of 499 studio, one-, two-, and three-bedroom apartments for seniors on its upper floors and 54 parking stalls in stackers in a basement garage.

ABS is seeking the approval of density bonus incentives permitting relief from local zoning restrictions relating to floor area, open space, and setbacks. The project would include 100 moderate-income units, 394 low-income units, and five manager's apartments.

Cuningham is designing Skyvillage, which would rise approximately 283 feet in height. Plans show a contemporary exterior of fiber cement and metal panels, with cantilevering balconies and solar panels embedded into the side of the building. In addition to private open space, images show a rooftop amenity deck.

At the street level, ABS has proposed realigning the wedge-shaped intersection of Fernwood and De Longpre, allowing the tower to rise on the western side of the intersection rather than the eastern. The ground plane surrounding the high-rise would be improved with a landscaped plaza featuring a community garden, outdoor seating, and water features.

The proposed project sits a block southwest of the intersection of Sunset Boulevard and Western Avenue, which has recently seen the construction of a new (and briefly sentient) Target, and is poised to add roughly 1,000 apartments through a pair of mixed-use projects in the near future.

The Skyvillage property is also bounded by two other multifamily residential developments - Holland Partner Group's 185-unit Ardence & Bloom apartments and the PATH Villas Hollywood supportive housing complex.

Looking for affordable housing? Visit lahousing.lacity.org/aahr and housing.lacounty.gov

California's 2022 state income limits

Click here for additional affordable housing resource

Tech makes it easier

 

Fintech companies are easing the ‘high-friction process’ of buying a home

During the pandemic housing boom, the increase in mortgage applications created a need for faster turnaround times in loan approval and processing.

https://money.yahoo.com/fintech-high-friction-process-home-buying-190958281.html

Fintech companies jumped into the market to fill the void.

According to Citi's Home of the Future research series, there are numerous ways the tech industry can ease the lending and selling process for home buyers.

“There's a lot of process that happens around mortgage lending — looking at borrowers' incomes, documentation, verification, and other aspects of enabling a borrower to get a loan to go buy a house,” Roger Ashworth, head of Citi's research non-agency MBS strategy team, told Yahoo Finance Live (video above), later adding: “Historically speaking, it's been a high-friction process market… anything we can do to streamline that process is certainly appreciated.”

Although the housing market has cooled down with the 30-year fixed mortgage rate at 5.30%, down from 5.70% the week prior, there are still buyers in the market.

Elegant brownstones and townhouses in the West Village. Manhattan, New York City
Credit: Getty Images
With rates changing weekly, home buyers that haven’t locked in rates will need to requalify — making the home buying process even more protracted.

Not only would a more efficient underwriting process be beneficial for home buyers racing against rising rates, it could also help them save $1,000 to $2,000 in costs, Ashworth said.

Fintechs are also trying to make selling your home less stressful.

“When you think about moving from one home to another, you have to sell one home — it's an emotional process [with] a lot of friction involved,” Ashworth said. “There are companies out there looking to streamline that process by providing an instant offer to your home.”

Some of these fintech companies are also coming up with innovative ways for homeowners to tap into equity, which is especially helpful for homeowners that missed out on refinancing with the low mortgage rates from earlier in the year.

“Companies are willing to, instead of taking out a second mortgage, they'll simply purchase a piece of equity for your home, for a share of that home price appreciation going forward,” Ashworth said. “There's a lot of potential market share across the board and a lot of frictions that can be removed in the underwriting process in the real estate transaction process.”

Ronda is a personal finance senior reporter for Yahoo Money and attorney with experience in law, insurance, education, and government. Follow her on Twitter @writesronda

US cities with most economic growth

 The U.S. economy has made a remarkable comeback from the deep dive caused by the pandemic. Consumer spending (fueled by savings and government stimulus money) is strong, the economy recently added the most jobs in nearly a year, and the housing market is booming. According to the Bureau of Labor Statistics, nonfarm employment has grown by 1.5% from January to May, and the unemployment rate is now 5.9%, well below the high of 14.8% seen in April 2020.

In the spring of last year, real gross domestic product (GDP)—a measure of economic activity used to track the health of the country—fell by a record annualized rate of 31.4%, the sharpest contraction in modern U.S. history. In comparison, real GDP fell by less than 9% annualized in 2008 during the Great Recession and took several years to recover. Following the initial COVID-19 shutdowns, GDP has been recovering quickly as economic activity resumes, and is projected to return to its pre-pandemic level later this year.

Alongside the broader economic contraction were massive job losses: non-farm employment initially dropped by 20.5 million in the early stages of the pandemic. Following this unprecedented decline, employment increased sharply in May of last year, but since then, the recovery has slowed with current employment far below pre-pandemic levels. Some cities and states have been affected more than others depending on local economic factors. As such, current unemployment rates vary widely across the country, ranging from less than 3% to more than 10%.

To find the locations with the most economic growth in 2021 researchers at Stessa analyzed data from the Bureau of Labor Statistics, the U.S. Census Bureau, and Redfin, creating a composite score based on the following factors:

Percentage change in total employment from January to May 2021
Unemployment rate from May 2021
Average monthly building permits per capita (averaged over January to May 2021)
Average monthly home sales per capita (averaged over January to May 2021)
Based on these metrics, Utah and Florida are the two states with the most economic growth this year. Both states saw employment grow by 1.5% from January to May and have lower than average unemployment rates (at 2.7% and 5.0%, respectively). At a time when housing is in short supply across much of the country, new residential construction is booming in these states, with 107 and 79 average monthly
Based on these metrics, Utah and Florida are the two states with the most economic growth this year. Both states saw employment grow by 1.5% from January to May and have lower than average unemployment rates (at 2.7% and 5.0%, respectively). At a time when housing is in short supply across much of the country, new residential construction is booming in these states, with 107 and 79 average monthly building permits per 100,000 residents, respectively, far above the national rate of 43.

At the opposite end of the spectrum, Louisiana and Alaska reported the least economic growth so far this year. Louisiana employment actually decreased slightly from January to May while employment in Alaska increased only marginally. Both states have higher than average unemployment rates and lower than average residential construction and home sales per capita.
RELATED

Real estate investors with one to several hundred rental properties all use landlord software to help manage property more smoothly and maximize the potential return of rental property investments. Here are the 10 best landlord software platforms right now

To find the metropolitan areas with the most economic growth, Stessa ranked metros using the same composite score. To improve relevance, only metropolitan areas with at least 100,000 people were included in the analysis. Additionally, metro areas were grouped based on population size.

Here are the U.S. metros experiencing the most economic growth in 2021.

-small and medium metros with most econmic growth

-Large Metros With the Most Economic Growth in 2021.

For details on each see link below:

https://www.stessa.com/blog/cities-with-most-economic-growth/

No crises on housing market?

Rogers Healy Companies CEO and Owner Rogers Healy joins Yahoo Finance Live to discuss the decline in mortgage rates and how it hasn't affected demand, along with how he helped NBA legend Shaquille O'Neal find a new home in Dallas.

https://finance.yahoo.com/video/housing-market-isn-t-headed-195156651.html

- All right, what's ahead for the once hot housing market? Mortgage rates today plummeting to 5.3% on a 30-year, that's the largest drop since 2008. Rogers Healy is the owner of Rogers Healey and Associates Real Estate. He joins us now from Dallas, where it looks like the stash has fallen along with the mortgage rates, my friend. It's tragic.

ROGERS HEALY: He fell off right as I walked in.

- Mortgage rates and mustaches, it's all falling. All right, so we know what happened in 2008.

ROGERS HEALY: It's been a dramatic day.

- I know, I'm sorry for you. Could we see something like 2008, or is there any similarity between these two markets?

ROGERS HEALY: Yeah, you know, and first of all, you never know what's going to happen. I think we've learned over the past few months that it's all, you know, it's all unpredictable. And I think that keeps people like me on my toes. And so I think that, you know, we're still going to be in a pretty stable run here coming up. But you know, what's interesting is the mortgage decrease, as far as the rate today, it's still higher than it was two months ago. So to be above 5% is still substantially higher than it was in late and early spring.

But I don't think we're headed towards any kind of crisis. I don't think that we have any numbers that support a housing crash. I think that it's going to give people an opportunity that had been waiting the last few years because mortgage rates have decreased. Inventory has increased, and so hopefully, it's going to create a whole different opportunity for people that have been waiting.

- And obviously, we did have a lot of people waiting on the sidelines, and that was for a lack of inventory. And then of course, you add in the mortgage rates and the interest rate hike from the Fed, and that sort of really did put people off. But what are we seeing now that we're seeing inventory is climbing up about 18.7% year over year? But is it going to climb fast enough and at what point to match the demand that's out there?

ROGERS HEALY: Yeah, I think kind of the thing that people aren't really discussing is this is normally a slower time of year. And so when you have interest rates that are higher than they were a year ago, even though inventory is a little bit higher, as well, you know, I think that we're going to have a little bit of circumstances that are unforeseen. But I do think that there has been a really big pickup the last two weeks. And then hopefully, this week and next, we're going to have people come out of the woodwork because the other thing that people aren't really mentioning that often is that rental rates are at an all-time high.

And these people that purchased properties two years ago and prior, they're building at a time that they have to go recoup the costs that they went and overpaid for the land. So I do think we're going to have an influx of buyers between now and probably late November.

- So at that 30-year average, a borrower with a $300,000 mortgage would pay roughly $1,665 a month. That's $383 more per month than just the end of last year. So the question being when are we going to see some softening of these prices?

ROGERS HEALY: Well, I think it goes back to the rental rates. I think that the average rent right now for a two-bedroom across the country is probably closer to $1,900 a month. So on paper, if somebody can afford a down payment, that's a good deal. Even though it's 300 and some odd dollars more expensive, you're building equity. And I think that right now, if average appreciation across the country is say 3% per year, you're buying into money.

So I do think we're going to see a continued not hockey stick like we saw the last 2 1/2 years, but it's going to still be kind of a relative appreciation and people that are still missing out, believe it or not, which means a year from now, two years from now, we're going to have those same people coming back trying to get in something.

- Now, we did see that someone who made a move to Dallas, made a move actually with you, Shaquille O'Neal. Talk about what you're seeing with some of these high net worth people. Like, what are they looking for, and what is that experience like as they have now coming to Dallas, and what is it that they're coming to Dallas for?

ROGERS HEALY: I think the short answer is opportunity. And you know, obviously, our firm has represented a lot of big names, most recently Shaquille O'Neal, like you said. And I think that once people get over the fact that Dallas doesn't have mountains, it doesn't have water, it makes sense. And Dallas compared, to a Chicago, an LA, a New York, an Atlanta, a Miami, or a Vegas, it's a great deal on paper, and it's also centrally located. So we've always had people that are in the pro sports world live here that have no direct connection to Dallas or Texas, but Shaq actually is a native Texan.

And so maybe it just felt like it was the right time. But yeah, you know, it feels like Dallas, all of a sudden, is this next boomtown, and everybody wants to be here. And I get a kick out of it because when you come to visit, you better have friends, or family, or a concert, or a bar to go to because that's our sales pitch. But I think people have appreciated the fact that it's booming and there's opportunity to grow all four ways. And athletes love the controlled climate and love that it's centrally located.

- I'm checking out the stats on the Shaq home, five bedroom, five baths, 5,300 square feet. I was surprised it was actually relatively modest for a guy worth $400 million. What's the big fella looking for, just high ceilings, high doorways?

ROGERS HEALY: Yeah, you know, and I don't know if it's appropriate to get into the details of that, but I'll tell you that people that are worth $400 million are worth $400 million for a reason, and it's probably because they know how to spend and invest their money. So I hope people are saying that about me one day, be like that guy without a mustache, you know, he's got $400 million, and he only spent $2 million on his weekend home. But you know, I think that it all makes sense.

But if I was seven-foot tall, I think ceiling heights would make a really big difference.

- And I want to ask you another thing that has a lot of high ceilings, commercial real estate, things like warehouses. What are you seeing in terms of commercial real estate, and what are some of the specific sectors that are really jumping ahead of the curve?

ROGERS HEALY: Yeah, so in my experience, commercial real estate trends usually are about two to three years behind residential. And so what's happened, even in the last few months alone, is we've seen office space booming, especially in cities like Dallas. And people that are kind of tired of working from home, or they need more space to collaborate, they need more office space. And I think what we saw happen in COVID, the trends for residential, where people didn't want big, open office environments, that's kind of coming back to commercial, as well.

And on top of that, too, the industrial space, they literally cannot build it fast enough. And you can think about companies like Amazon that need a million square feet per warehouse. There's also companies that need 30,000 and 50,000 square feet. So those markets continue to boom all across the country, especially in the cities that are kind of forever towns, like New York, Dallas, LA, Houston, et cetera. So yeah, I think we've got a solid multi-year run for commercial real estate being at a peak.

- It certainly sounds like you're going to have your hands full. Always good to see you. Rogers Healey there, the Rogers Healey Company's owner and CEO. Thank you.

Fed signals lower hikes?

By Lindsay Dunsmuir and Ann Saphir

(Reuters) -Two of the Federal Reserve's most vocal hawks on Thursday said they would support another 75 basis-point interest rate increase later this month but a downshift to a slower pace afterward, even as both downplayed the risk of higher borrowing costs pushing the U.S into recession.

https://finance.yahoo.com/news/feds-waller-backs-75-bps-173528610.html

"I am definitely in support a doing another 75 basis-point hike in July," Fed Governor Christopher Waller said during a discussion with the National Association for Business Economics.

"Probably 50 in September," Waller added, "and then after that we can debate whether to go back down to 25s or if inflation just doesn't seem to be going down, we have to do more."

At a separate event in Little Rock, Arkansas, St. Louis Fed President James Bullard also said a 75 basis-point hike at the U.S. central bank's next policy-setting meeting on July 26-27 would "make a lot of sense."

The move would bring the policy rate to a range of 2.25%-2.5%, about a percentage point short of the 3.5% level Bullard said he continues to advocate for by the end of the year. Stretched out over the three meetings left after the one this month, his view also points to a slowdown in the pace of rate hikes, though he did not map that out explicitly.

The Fed last month raised its benchmark overnight interest rate by three-quarters of a percentage point, its biggest hike since 1994, as it stiffens its resolve to tame stubbornly high inflation without causing too much economic harm.

Waller's comments had an immediate impact on market expectations, with investors reducing bets on the Fed hiking rates by 75 basis points in September to 13%, down from 23% before he spoke, according to an analysis of Fed funds futures contracts by CME Group, which shows an 80% probability of a 50 basis-point rise at that meeting.

Rate futures traders continue to expect a 75 basis-point hike this month.

OVERBLOWN FEARS

Rising interest rates, inflation and tighter financial conditions have darkened the economic outlook, with recent data on consumer spending and factory output showing signs of a slowdown and sparking recession fears.

Waller was mostly unmoved, citing services data as well as a strong labor market although he acknowledged there are dangers.

"I personally think some of the fears of a recession are overblown," he said. "We're going to get inflation down. That means we are going to be aggressive on rate hikes and we may have to take the risk of causing some economic damage, but I don't think, given how strong the labor market is right now, that that should be that much," he said.

Raising rates to 3% or slightly higher will not send the unemployment rate, now at 3.6%, to something dramatically higher like 6% or more, he said.

Bullard likewise said that labor markets, currently nearly as healthy as they have ever been, could cool quite a bit and still remain strong, and that his "base case" is for a softish landing where growth slows from its soaring pace last year. "Some people are mistaking that for recession" he said.

While GDP, the most widely cited measure of U.S. output, fell in the first quarter and looks on track to fall again this quarter, output by a different measure more reflective of the labor market has remained positive and is expected to stay so.

Economists expect a fresh read of the U.S. labor market on Friday to show employers added 268,000 jobs in June, fewer than the prior month but enough to suggest continued economic growth rather than a stalling of it, let alone a contraction.

Bullard said he expects inflation to fall rapidly as the Fed puts in its rate hikes, though most of the decline will come next year, not in 2022. Bullard said that once the Fed gets rates to 3.5%, it should assess the state of inflation and inflation expectations, and then could tweak policy to suit, including potentially by cutting rates.

Strategies to invest in RE

 

Buying and owning real estate is an investment strategy that can be both satisfying and lucrative. Unlike stock and bond investors, prospective real estate owners can use leverage to buy a property by paying a portion of the total cost upfront, then paying off the balance, plus interest, over time.

https://www.investopedia.com/investing/simple-ways-invest-real-estate/

Though a traditional mortgage generally requires a 20% to 25% down payment, in some cases, a 5% down payment is all it takes to purchase an entire property. This ability to control the asset the moment papers are signed emboldens both real estate flippers and landlords, who can, in turn, take out second mortgages on their homes in order to make down payments on additional properties. Here are five key ways investors can make money on real estate.

Aspiring real estate owners can buy a property by using leverage, paying a portion of its total cost upfront, and paying off the balance over time.
One of the primary ways in which investors can make money in real estate is to become the landlord of a rental property.
People who are flippers, buying up undervalued real estate, fixing it up, and selling it, can also earn income.
Real estate investment groups are a more hands-off way to make money in real estate.
Real estate investment trusts (REITs) are basically dividend-paying stocks.
1:40
5 Simple Ways To Invest In Real Estate

1. Rental Properties
Owning rental properties can be a great opportunity for individuals who have do-it-yourself (DIY) renovation skills and the patience to manage tenants. However, this strategy does require substantial capital to finance upfront maintenance costs and to cover vacant months.

Pros
Provides regular income and properties can appreciate

Maximizes capital through leverage

Many tax-deductible associated expenses

Cons
Managing tenants can be tedious

Potentially damage property from tenants

Reduced income from potential vacancies

According to U.S. Census Bureau data, the sales prices of new homes (a rough indicator for real estate values) consistently increased in value from the 1960s to 2006, before dipping during the financial crisis.1 Subsequently, sales prices resumed their ascent, even surpassing pre-crisis levels.23 The long-term effects of the coronavirus pandemic on real estate values remain to be seen.

Sales prices of new homes chart
Source: Survey of Construction, U.S. Census Bureau

Mortgage lending discrimination is illegal. If you think you've been discriminated against based on race, religion, sex, marital status, use of public assistance, national origin, disability, or age, there are steps you can take. One such step is to file a report to the Consumer Financial Protection Bureau or with the U.S. Department of Housing and Urban Development (HUD).4
2. Real Estate Investment Groups (REIGs)
Real estate investment groups (REIGs) are ideal for people who want to own rental real estate without the hassles of running it. Investing in REIGs requires a capital cushion and access to financing.

REIGs are like small mutual funds that invest in rental properties.5 In a typical real estate investment group, a company buys or builds a set of apartment blocks or condos, then allows investors to purchase them through the company, thereby joining the group.

A single investor can own one or multiple units of self-contained living space, but the company operating the investment group collectively manages all of the units, handling maintenance, advertising vacancies, and interviewing tenants. In exchange for conducting these management tasks, the company takes a percentage of the monthly rent.

A standard real estate investment group lease is in the investor’s name, and all of the units pool a portion of the rent to guard against occasional vacancies. To this end, you'll receive some income even if your unit is empty. As long as the vacancy rate for the pooled units doesn’t spike too high, there should be enough to cover costs.

Pros
More hands-off than owning rentals

Provides income and appreciation

Cons
Vacancy risks

Fees similar to those associated with mutual funds

Susceptible to unscrupulous managers

3. House Flipping
House flipping is for people with significant experience in real estate valuation, marketing, and renovation. House flipping requires capital and the ability to do, or oversee, repairs as needed.

This is the proverbial "wild side" of real estate investing. Just as day trading is different from buy-and-hold investors, real estate flippers are distinct from buy-and-rent landlords. Case in point—real estate flippers often look to profitably sell the undervalued properties they buy in less than six months.

Pure property flippers often don't invest in improving properties. Therefore, the investment must already have the intrinsic value needed to turn a profit without any alterations, or they'll eliminate the property from contention.

Flippers who are unable to swiftly unload a property may find themselves in trouble because they typically don’t keep enough uncommitted cash on hand to pay the mortgage on a property over the long term. This can lead to continued, snowballing losses.

There is another kind of flipper who makes money by buying reasonably priced properties and adding value by renovating them. This can be a longer-term investment, wherein investors can only afford to take on one or two properties at a time.

Pros
Ties up capital for a shorter time period

Can offer quick returns

Cons
Requires a deeper market knowledge

Hot markets cooling unexpectedly

4. Real Estate Investment Trusts (REITs)
A real estate investment trust (REIT) is best for investors who want portfolio exposure to real estate without a traditional real estate transaction.

A REIT is created when a corporation (or trust) uses investors’ money to purchase and operate income properties. REITs are bought and sold on the major exchanges, like any other stock.6

A corporation must payout 90% of its taxable profits in the form of dividends in order to maintain its REIT status. By doing this, REITs avoid paying corporate income tax, whereas a regular company would be taxed on its profits and then have to decide whether or not to distribute its after-tax profits as dividends.7

Like regular dividend-paying stocks, REITs are a solid investment for stock market investors who desire regular income. In comparison to the aforementioned types of real estate investment, REITs afford investors entry into nonresidential investments, such as malls or office buildings, that are generally not feasible for individual investors to purchase directly.

More importantly, REITs are highly liquid because they are exchange-traded trusts. In other words, you won’t need a real estate agent and a title transfer to help you cash out your investment. In practice, REITs are a more formalized version of a real estate investment group.

Finally, when looking at REITs, investors should distinguish between equity REITs that own buildings and mortgage REITs that provide financing for real estate and dabble in mortgage-backed securities (MBS). Both offer exposure to real estate, but the nature of the exposure is different. An equity REIT is more traditional in that it represents ownership in real estate, whereas the mortgage REITs focus on the income from real estate mortgage financing.

Pros
Essentially dividend-paying stocks

Core holdings tend to be long-term, cash-producing leases

Cons
Leverage associated with traditional rental real estate does not apply

5. Online Real Estate Platforms
Real estate investing platforms are for those who want to join others in investing in a bigger commercial or residential deal. The investment is made via online real estate platforms, which are also known as real estate crowdfunding. This still requires investing capital, although less than what's required to purchase properties outright.

Online platforms connect investors who are looking to finance projects with real estate developers. In some cases, you can diversify your investments with not much money.

Pros
Can invest in single projects or portfolio of projects

Geographic diversification

Cons
Tend to be illiquid with lockup periods

Management fees

Why Should I Add Real Estate to My Portfolio?
Real estate is a distinct asset class that many experts agree should be a part of a well-diversified portfolio. This is because real estate does not usually closely correlate with stocks, bonds, or commodities. Real estate investments can also produce income from rents or mortgage payments in addition to the potential for capital gains.

What Is Direct vs. Indirect Real Estate Investing?
Direct real estate investments involve actually owning and managing properties. Indirect real estate involves investing in pooled vehicles that own and manage properties, such as REITs or real estate crowdfunding.

Is Real Estate Crowdfunding Risky?
Compared to other forms of real estate investing, crowdfunding can be somewhat riskier. This is often because crowdfunding for real estate is relatively new. Moreover, some of the projects available may appear on crowdfunding sites because they were unable to source financing from more traditional means. Finally, many real estate crowdfunding platforms require investors' money to be locked up for a period of several years, making it somewhat illiquid. Still, the top platforms boast annualized returns of between 2% and 20%, according to Investopedia research.

The Bottom Line
Whether real estate investors use their properties to generate rental income or to bide their time until the perfect selling opportunity arises, it's possible to build out a robust investment program by paying a relatively small part of a property's total value upfront. And as with any investment, there is profit and potential within real estate, whether the overall market is up or down.

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ARTICLE SOURCES
PART OF
Real Estate Investing Guide Guide
A Beginner's Guide to Real Estate Investing1 of 34
Real Estate Definition2 of 34
5 Simple Ways to Invest in Real Estate3 of 34
How to Make Money in Real Estate4 of 34
The Most Important Factors for Real Estate Investing5 of 34
How to Find Your Return on Investment (ROI) in Real Estate6 of 34
Real Estate Investment Trust (REIT)7 of 34
5 Types of REITs and How to Invest in Them8 of 34
How to Invest in Real Estate: REIT vs. Direct Real Estate Investing9 of 34
REIT vs. Real Estate Fund: What’s the Difference?10 of 34
Equity REIT vs. Mortgage REIT11 of 34
How to Assess a Real Estate Investment Trust (REIT) Using FFO/AFFO12 of 34
Eyeing a Real Estate Investment Trust? Consider These REIT Risks13 of 34
Captive Real Estate Investment Trust14 of 34
How to Analyze REITs (Real Estate Investment Trusts)15 of 34
Tips for Buying Your First Rental Property16 of 34
Top 10 Features of a Profitable Rental Property17 of 34
Whether to Flip a House or Use Buy-and-Hold18 of 34
How To Calculate ROI on a Rental Property19 of 34
How Rental Property Depreciation Works20 of 34
Add Some Real Estate to Your Portfolio21 of 34
Alternative Real Estate Investments22 of 34
The Best Real Estate Crowdfunding Sites of 202223 of 34
10 Good Habits of Successful Real Estate Investors24 of 34
8 Mistakes That Real Estate Investors Should Avoid25 of 34
How To Value Real Estate Investment Property26 of 34
Investing in Luxury Real Estate27 of 34
Avoid Capital Gains Tax on Your Investment Property Sale28 of 34
How to Prevent a Tax Hit When Selling a Rental Property29 of 34
What Is a 1031 Exchange? Know the Rules30 of 34
Avoiding a Big Tax Bill on Rental Real Estate Gains31 of 34
Key Reasons to Invest in Real Estate32 of 34
The Advantages of Real Estate vs. Stocks33 of 34
Is Real Estate Investing Safe?34 of 34
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Related Terms
Real Estate Investment Trust (REIT)
A real estate investment trust (REIT) is a publicly traded company that owns, operates or finances income-producing properties. Learn more about REITs. more
Captive Real Estate Investment Trust
A captive real estate investment trust is a REIT that is controlled by a single company and is established for tax purposes. more
What Is a Distribution Reinvestment?
A distribution reinvestment takes place when the distribution from a pooled investment trust, such as an REIT or mutual fund, is automatically reinvested in the trust. more
Real Estate Investment Group (REIG)
A real estate investment group (REIG) invests in real estate by buying, selling, and financing properties. Read how to get started investing in REIGs. more
Commercial Real Estate Definition
Commercial real estate (CRE) is property used solely for business purposes and often leased to tenants for that purpose. more
How Hypothecation Works
Hypothecation occurs when an asset is pledged as collateral to secure a loan without giving up title, possession, or ownership rights.

House listings surge

US home listings just surged 19% in a turnaround for the supply-constrained real estate market — but housing affordability keeps dropping like a rock

https://finance.yahoo.com/news/us-home-listings-just-surged-184500513.html

Potential homeowners in the United States received a touch of relief this month as Realtor.com released new data stating home inventory increased by 18.7% in June.

While supply increased, so did the cost of owning a home. The median listing price for active listings climbed 16.9% year over year to $450,000, the report states. And supply is still about half of where it was before the COVID-19 pandemic.

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Supply up in large cities

Housing inventory in the 50 largest U.S. metros overall jumped by 27.9% over last year in June.

Metros that saw the most inventory growth include Austin (+144.5%), Phoenix (+113.2%), and Raleigh (+111.7%) — all cities that saw booming demand for housing during the COVID-19 pandemic.

Homes continue to sell relatively quickly. In the 50 largest U.S. cities, homes spent an average of 28 days on the market — 2 fewer days on the market compared to June 2021.

The share of newly listed smaller homes (up to 1750 square feet) declined year over year, while the share of homes larger than 1750 square feet increased, suggesting that buyers are choosing to purchase less expensive homes.

Interest rates continue to influence purchasing

The Federal Reserve continues to try and dampen inflation by increasing interest rates. This has led to a rise in mortgage rates as well, making it more difficult for homebuyers to afford a home.

This also means many Americans are choosing to wait it out to see if mortgage rates reach a peak, or start to decline.

The Fed’s benchmark rate will end the year at 3.4%, according to the midpoint of the target range of individual members’ expectations. That could lead to more homes on the market in the near future as Americans decide now isn’t the time to buy.

The worst situation in 15 years

Affordability has hit a 15-year low with median home prices climbing to record highs, according to data service ATTOM.

It would take the average American more than one-third of their wages to cover homeownership expenses, higher than the recommended 28%, ATTOM’s data report states.

Of the 575 counties analyzed in their most recent report, 560 were less affordable than the year before. That’s 97% of counties compared to 69% in 2021. This makes it the highest point since 2007, just before the Great Recession and housing crash.

“Extraordinarily low levels of homes for sale combined with strong demand have caused home prices to soar over the last few years,” said Rick Sharga, vice president of market intelligence at ATTOM.

“With interest rates almost doubling, homebuyers are faced with monthly mortgage payments that are between 40 and 50% higher than they were a year ago — payments that many prospective buyers simply can’t afford.”

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