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Weekly News (December 7, 2022)

Mortgage Interest Rates Review

(Fairway Home Loan 12/7/2022)

30 yr fx (%) 15 yr fx (%) FHA (%) 10 yr Tr Y (%) 5 yr Arm (%)

7 yr Arm (%)

A year ago

3.200 2.500 2.750 1.646
A month ago 6.875 5.875 6.375 4.075 6.875

6.875

Last week

6.299 5.499 5.875 3.714 6.375

6.375

This week 6.375 5.500 5.999 3.550 6.375

6.375

Federal Fund Rate: 3.75 -4.00%        Prime Rate: 6.75-7.00%

 

 

More Zombie Buildings in Manhattan: 맨하탄 좀비 빌딩 늘어

(WSJ  12/6/22)

  • According to Castle systems, recently NYC Commercial’s occupancy rate dropped to below 50%. Columbia and NYU research forecasted that commercial building prices will drop 25% till 2029.
  • Meta Platform(Facebook) announced 250,000 sf reduction of office space in Hudson Yard after Meta CEO announced 11,000 worker layoff.
  • KPMG announced 40% reduction of their office space while they are moving into Hudson Yard.
  • Total value of commercial office building in NYC reduce $28.6B which is the first time since 2000.

 

 

Replacing Dead Malls can be a Struggle: 죽은 쇼핑 몰들을 살리기가 쉽지 않아

(WSJ  12/7/22)

  • The long-decaying White Plains Mall is dead and buried, with developers, RXR, set to break ground this week on the 1st phase of a $650M project to build 860 apartment units in its place.
  • There is no-shortage dying malls in the U.S., where aging shopping centers, in particular, have declined due to changing shopping habits,  e-commerce and competition form new malls.
  • But converting enclosed shopping centers remains a difficult feat.
  • The White Plains Mall took 2 years to obtain zoning approvals.

Rendering of White Plains Mall in White Plains

 

 

More Buy-down option in the market: 모기지 바이 다운프로그램 늘어난다

(Korea Times  12/7/2022)

  • In the Mortgage market, “Buy-Down” program is getting momentum fast, which seller agrees to pay the cost of lowering interests rates for first few years amid high interest rates are hindering sales.
  • Most popular type of buy-down program is 2-1 buy-down : 2% lower for the first year and 1% lower for the second year.
  • In San Francisco bay area, about 50% of agents said they have done transaction with buy-down programs and 46.3% in California overall.

 

 

Fed Weigh Rates Higher than 5%: 연방준비위, 기준금리를 5% 이상 까지 예상

(WSJ  12/6/22)

  • The Fed have signaled plans to raise their benchmark interest rate by 0.5% point at their meeting next week, Dec 13-14, but elevated wage pressures could lead them to continue lifting it to higher levels that investors expect.
  • Brisk wage growth or higher inflation in labor-intensive service sectors of the economy could lead more of them to support raising their benchmark rate next year 5% currently anticipated by investors.
  • Fed officials are likely debate next week how much to raise rates in February, with views shaped by how they see underlying price pressure.

 

 

Powell favors a soft-landing: 연착륙 의지 드러낸 파월

(Korea Times  12/4/22)

  • Powell said, in the Brookings Institution seminar in DC on 30th, he believes the economy can still make a soft landing, which is very reasonable.
  • It is hard to declare that Inflation is ended, but it will show decline in a few months in commodity and housing market, both sale and rent.
  • It could be possible that inflation can be controlled without increasing unemployment dramatically.

 

 

Investors Yank Money From Property Funds:상업용 부동산 투자자들, 환매 증가

(WSJ  12/7/2022)

  • Big and small investors are lining up to pull money out of real-estate funds, the latest sign that the surge in interest rates threatens to upend the commercial-property sector.
  • Blackstone Inc. last week said it would limit the amount of money investor could withdraw from its $69B flagship real-estate fund following a surge in redemption requests.
  • Starwood Capital Group shortly after notified investors that it was also restricting withdrawals in a 14.6B fund.
  • Typically, these funds allow investors to withdraw money each month or quarter but only up to a set limit.

 

 

Apple’s New Plan to Move beyond China: 애플사, 중국을 벗어나 다른 지역으로

(WSJ  12/3/22)

  • In recent weeks, Apple Inc. has accelerated plans to shift some of its production outside China, long the dominant country in the supply chain that built the world’s most valuable company.
  • It is telling suppliers to plan more actively for assembling Apple products elsewhere in Asia, particularly India and Vietnam, and looking into reduce dependence on Taiwanese assemblers led by Foxconn Technology Group.
  • Coming after a year of events that weakened China’s status as a stable manufacturing center, the upheaval means Apple no longer feels comfortable having so much of its business tied up in one place.
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Stephen Lee

He has been in Real Estate industry in about 20 years and has been Broker of Record for 9 years. His experience includes residential, commercial, and property management. Prior to involving with Real Estate business, he has been involved in the digital communication equipment industry utilizing his engineering background and education, including running own company. He has established C Land Realty in 2011 which has grown to staffing over 100 Real Estate agents and the annual transaction amount of over $110,000,000 today.

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