Weekly News (February 12, 2020)
This week’s Interest Rate (7th Week)
30 Y Rate: 3.375%/ 15 Year Rate:2.99%/ 10 Y Treasury: 1.651%/ FHA:3.25%/ VA:3.000%
Prime Rate:4.75% / Ref IR: 1.50- 1.75%
NY renters will not have to rental broker fee by tenant law
(The Korea Daily, TRD 2/12)
- NY DOS(Dept Of State) announced the order specifying that tenant should not pay the rental broker fee which has been about 15% of the yearly rent amount as of 2/6/2020.
- REBNY(Real Estate Board of NY) and the New York State Association of Realtors filed the suit against DOS order, claiming that this order is cross-over to the right of legislature body of the State.
- NY court has issued the temporary restraining order (TRO) as of 2/10/202 that the brokers can collect the fee from tenant in the same manner as was customary prior to the issuance of the DOS guideline.
- The NY court will start the hearing of the suit from 3/13/2020.
New Jersey towns, with more Korean population, will get tax increase
(The Korea Times 2/12)
- NJ towns will get tax increase continually, especially those towns with more Korean population between 1% – 5% in 2019.
- Edgewater: 5.3%, Demarest: 4.1%, Palisades Park: 4%, Englewood Cliffs: 4%, Fort Lee: 3.1%, Ridgefield: 2.8%, Paramus: 2.5%, Tenafly: 2.1%, Closter: 1.7%, Leonia: 1.6%.
- Statewide average increase is 2.1%.
- The highest average tax is $21,468 in Alpine and the 2nd place is Tenafly with $21,146.
Gateway Project might be delayed due to lack of Federal Government funding
(The Korea Daily , The Record 2/12 )
- Gateway project of making new tunnels under Hudson Rover and connecting to Portal North Bridge could not been started due to uncertainty of funding so far.
- The Trump administration announced on Monday(2/10) that it had deemed the Portal North Bridge project eligible to receive federal funding while again ruling that the related Hudson River rail tunnel had not met the criteria required to receive grant money.
- The Portal North bridge, owned by Amtrak, is century-old, built in 1910, swing-span rail bridge and the project is to make new two track rail bridge. The bridge carries 150,000- 200,000 passengers daily and busiest train span in the Western Hemisphere. The project cost is estimated $1.8B.
- This project is a complementary project to the more than $11B Gateway project.
- Efforts to fund of these projects have become a political football.
NJ foreclosure is being dropped, but highest state in US for 5 years
(The Korea Daily 2/7)
- According to AtomData Solution, nationwide foreclosure rate is lowest in last 15 years when the foreclosure statistics began. Last year, 493,066 homes were foreclosed, which was drop by 21% from the year before, and 83% reduced from 2.9M foreclosed homes in 2010. Last year’s foreclosed homes was 0.36% of total homes in US.
- New Jersey’s foreclosure rate was 0.82% which was higher than other states.
Following NJ, Delaware was 0.73%, Maryland was 0.66%, Florida and Illinois were 0.63%, and New York was 0.41%.
- Another issue in New Jersey is that number of sales was highest in history, but average price of home sale was about the same level of 2006. US average hone price in 2019 was 25% higher than 2006 price, but New Jersey home price has not reached to that point.
- If New Jersey home price does not improved for longer period, then it might keep the number of foreclosed homes continually.
Low Mortgage IR for longer period is not all good
(The Korea Times 2/8)
- Nationwide average 30 year fixed rate became 3.72% in the 1st week of January this year and it became 3.6% at the 4th 15 year fixed rate became 3.0%, facing toward 2% range soon. 30 year fixed rate is the lowest rate since last Oct. and only 0.25% higher than lowest point in mortgage history.
- Mortgage rate is linked with 10 year treasury yield rate which is dropped continually because of insecurity of global economy and geo-political instability.
- If lower IR continues longer, less sellers want to sell their homes which will offset the increased buying power because of lower IR.
- According to NAR, December 2019 inventory was lowest in last 20 years. If this inventory issue is not resolved, then this year residential market can be affected negatively, warned experts.
2019 home price rose 3.6% nationwide, according to CoreLogic
(The Korea Daily 2/7)
- 2019 home price rose 3.6% while home price rose 5.8% in 2018, according to CoreLogic. In December 2020, home price increase slop will higher again to the level of 5.2%.
- According to CoreLogic, HPI was lowest point in 2011 and it has been improved continually for last 7 years by 63%.
Forever 21 sold at $81M to the creditor group finally
( TRD 2/10)
- The retailer has agreed to an offer of $81M from a group of buyers including Simon Property Group and Brookfield Property Partners, reported WSJ on Monday.
- The deal was made by a slaking-horse purchase agreement.
Other/Tech News : T-Mobile and Sprint are merged, approved by the Court
(The Korea Daily 2/12) – T-Mobile and Sprint were 3rd and 4th in mobile industry
– If this deal is settled, it becomes 3rd biggest company along with Verizon and AT&T in US.
– Foldable phones released on the market
– SamSung’s Galaxy Z Flip: $1380
– Motorola’s Razr :$1500