Happy Friday, friends! One of our favorite routines is a walk around the neighborhood in the morning. It’s a time we get to talk outside of the house, listen to a podcast together and say hello to all of our friendly neighbors.
The walk route is just under two miles, and Bear makes it roughly 1/10th of the way and then jams on the breaks to let us know she’s had enough. We put her in the bottom of the stroller and I let Scott push it for the rest of the walk.
Along the way there is a small turnoff from the street where we found some ducks that Maven loves looking at and talking to. “Quack quack” was one of the first things she said, so you know she has a special little relationship with those feathered friends.
The other day, we passed by the turnoff without stopping. Maven started screaming but we could’t figure out what was wrong, and then we noticed her tiny little index finger pointing out of the stroller and towards the turnoff. We obviously turned around and spent a few minutes talking with her buds.
Moral of the story: there’s always time for the ducks.
Nearly every day, Compass’s Leonard Steinberg puts together a handful of real estate new bits that are always so interesting I have to share some of my favorites of the week. To receive these every day from Leonard, please click here and include your full name and email address to get on his mailing list.
* The wealthiest 0.01% of America’s households, 40% of their wealth flows from equity in corporations while 29% comes from the pass-through businesses that include partnerships, limited liability companies and sole proprietors. (Marketwatch)
* Nearly 12% of first-time buyers indicated that selling cryptocurrency holdings helped build a down payment for a home in the 4th quarter of 2021, up from 8.8% of buyers surveyed in the 3rd quarter of 2020, and 4.6% of novice home buyers in the 3rd quarter of 2019. (Bitcoin was trading around $67,000 in November 2021, and now its around $42,000…..)
That’s roughly in line with the share of first-time buyers who relied on cash gifts from family for their down payment. 52% of first-time home buyers said they grew their down payment by saving money earned through their paycheck. (Marketwatch)
* U.S. inflation is on track to have closed out 2021 near its highest level since 1982 as robust consumer demand exacerbated pandemic-related supply shortages. Estimates by the Labor Department’s consumer-price index—which measures what consumers pay for goods and services—rose 7.1% in December from the same month in 2020, up from 6.8% in November. Inflation in the world’s rich economies has hit a 25-year high, fueling concerns about the rising cost of living for households and increasing pressure on central banks to raise interest rates. Many expect four interest rate hikes this year to curb this spike. (FT/WSJ)
* The NAR expects 30-year fixed mortgage rates to end 2022 at 3.7%, up from a recent 3.2%, while a consensus estimate collected by NAR forecasts a 5.7% rise in home prices in 2022. The sales price of the median existing home was $353,900 in November. A $300,000 30-year fixed rate mortgage at 3.7% would cost about $1,381/month, about $84 more per month ($1,297/month) than at 3.2%. A $1 million mortgage at the higher rate will cost about $278 more per month…..that sounds manageable when many are experiencing rising wages and asset valuations.
* Morgan Stanley bonuses have raised their bonuses by more than 20%. Bank of America bonuses could be higher by as much as 40%. (CNBC)
* The book EMPTY MANSIONS is being made into a movie. It features the homes of reclusive heiress Huguette Clark who spent the final two decades of her life in a hospital room. One of them – Bellosguardo, a mansion in Santa Barbara constructed during the Great Depression – is now a nonprofit created to manage the 23-acre property as a public space for the arts. The rarely used home is not unlike the homes of the Gilded Age in Newport that have found new lives as museums. Few are owned by individuals forever. Most home ownership is temporary….
* Some mansions don’t survive: The New York City 121-room Clark mansion located at 962 Fifth Ave was demolished in 1927 and replaced with a luxury apartment building (960 Fifth Avenue). The home with a pool and underground rail line to deliver coal took 14 years to build and lasted just 16 years before being demolished…. Some mansions DO survive: Clark’s 34-room, Tiffany-decorated home on West Granite Street, in Butte, Montana is now the Copper King Mansion bed-and-breakfast, as well as a museum. Clark was the namesake for Clark County, Nevada, and the founder of Las Vegas as well as a railroad builder, senator, and gold and copper magnate of the gilded age.
* Private job growth totaled 807,000 for the month, well ahead of the Dow Jones estimate for 375,000 and the November gain of 505,000 according to ADP. Hiring was broad-based, though leisure and hospitality led with 246,000 new positions. Businesses with 500 or more employees accounted for the bulk of the gains in December, adding 389,000 jobs. (CNBC)
* US Home ownership costs rose in the 4th quarter of 2021, with the typical home consuming 25.2% of the average national wage of $65,546. In comparison, the fourth quarter of 2020 saw ownership costs at 21.5%. (ATTOM)
* Richard Hopen of COMPASS Short Hills, NJ has created a Workplace group for agents to learn how real estate will intersect with NFTs, crypto, blockchain, defi, and DAOs.
* If home prices escalate just 2.8% this year (as many predict)and each year thereafter for the next 10 years, home prices could rise about 32% in the next decade. IF.
* According to LinkedIn’s analysis, new company formation in the Miami area surged 45% during the pandemic. Miami now ranks second nationwide for new company formation. All three of the top cities are in Florida, with Orlando barely nudging out Miami for the top spot by 1%.
* The US Equity markets value soared at a record pace in 2021, more than double the rate of prior years, US unemployment is down to 4.2%, average hourly wages rose close to 5%…..yet the government has been given a “D “for the economy in a recent CNBC/Change poll……perception and reality are often vastly different.
* Mortgage applications dropped 40% year over year. 30-year fixed mortgages are now 58 basis points higher than a year ago. (CNBC)
* 151 office buildings, hotels or other commercial properties were converted to apartments in the U.S. in 2021. (Bloomberg)
* Greenwich CT broke records in 2021! There were 1,005 single-family closings in 2021 compared to 863 in 2020, an increase of 16% with the dollar volume up 31% to more than $3 Billion (the highest ever), an increase of more than $700 million year over year! The average price of a home was $2,995,027 (the highest ever), up from $2,667,709 in 2020. July had 143 closings, a record number for one month. The highest single-family sale was $50 million and $4,9 million for a condo! Inventory remains super-low, with only 152 single-family homes and 52 condominiums on the market. Thanks Bill Andruss for this great summary!
* Most in the real estate industry believe that the hyper-escalation of home prices we saw in 2021 will slow in 2022. “Normal” might make for a pleasant change?
