Weekly News (May 15, 2024)

Mortgage Interest Rates Review

United Mortgage Nation  5/15/2024

                  Federal Fund Rate: 5.25 -5.50%        Prime Rate: 8.25 – 8.50%  

Re-development in Queens declined

Korea Times  5/8/24 

퀸즈 지역 건설 붐 급격 둔화   

• According to Queens DOB’s recent report, New Building Permits reached to 3,824 which is the lowest since 2016. 
• New building permits hit 13,921 in 2022, and average permits reach annually between 5000- 6000. 
• But, about 30% (1,135) of these projects are concentrated in Willets Point re-development area, which is 1.6 times of Manhattan Inwood area’s 691 permits which is the 2nd place.
• New permit declines are due to most 421-a Tax abatement program have ended.     

Law Spurred by Collapse Roils Florida Condos

WSJ   5/15/24 

• Under the new law, buildings must pass milestone structural inspections no later than 30 years after they are built. In Miami, about 38% of the housing stock is condos, the highest of any major metropolitan area in the U.S., according to Zillow. Of those buildings, nearly three-quarters are at least 30 years old. For those that have large repairs looming, many owners are scrambling to sell before Jan. 1 when building reserves must be fully funded to be in compliance with the law. Condo inventory for sale in South Florida has more than doubled since the first quarter of last year, to over 18,000 units. While the sharp rise in Florida home insurance costs is driving some to sell, most of the units on the market are in buildings 30 years or older.

Special Assessment in Florida condo

WSJ 5/15/24

A recent Florida law means a special assessment of more than $134,000 per unit owner for repairs at Miami’s Cricket Club. BRYAN CEREIJO FOR THE WALL STREET JOURNALAfter originally listing his unit for $350,000, he kept marking it down until finally it sold for $110,000 last month, or 42% less than what he paid for it.

Construction of Rental Houses Balloons

WSJ 5/15/24 

• In 2023, 93,000 new single family homes for rent were completed, according to estimates from housing-consulting firm John Burns Research and Consulting. That was 39% more rental homes than in 2022, and the most in any year ever. The breakneck pace is poised to continue this year before easing by 2025.
• Nationally, rents for both apartments and houses rose more than 20% during the pandemic years. As of 2022, the median American renter spent 31% of his or her income on housing, according to Harvard Univ JCHS. But home sales prices and mortgage costs have risen even faster. In March of this year, the average monthly mortgage payment had ballooned to 38% more than the average monthly apartment rent, according to a report from brokerage CBRE.

New Rental Houses built

WSJ 5/15/24

Housing Price out of control:47% Up in 4 years

Korea Daily/Times  5/15/24 

고삐 풀린 집값… 4년간 47% 올랐다     

• According to Fox News, U.S. house price increased 47% since 2020 for 4 years due to mostly low supply by low new constructions, high mortgage interest rates, and construction cost hike. 
• After 2000, for the same period, house price increased 47.3%, and it went up 80% right before 2007 when financial crises began.
• Realtor.com reported that new house supply declined 34.3% compared to the pre-pandemic era in earlier 2020.
• Recent Zillow survey said most home owners’ willing to sell houses would doubled if the rates would have been 5% or more, but 80% of home owners have under 5% rates.      

Powell Maintains His Wait-and-See Stance on Rates

WSJ   5/15/24 

연준의장 이자률 지켜보기 입장 고수  

• The Fed Chair Jerome Powell affirmed the central bank’s plans to hold interest rates at the highest level in more than two decades as it awaits evidence that a slowdown in inflation will resume after setbacks this year.  “We’re just going to have to see where the inflation data fall out,” he said on Tuesday.
• The Fed is trying to navigate two risks after conducting over the last two years the most aggressive series of interest-rate increases in four decades. One is that they ease too soon, allowing inflation to become entrenched at a level above their 2% target. The other is that they wait until the labor market crumples under the weight of higher rates.

Biden to Hit Beijing with EV Tariffs

WSJ  5/11/24 

바이든 대통령, 전기차 관세벽으로 배이징 공격      

• Higher tariffs, which Biden administration officials are preparing to announce on Tuesday, will also hit critical minerals, solar goods and batteries sourced from China.
• Officials are particularly focused on electric vehicles, and they are expected to raise the tariff rate to roughly 100% from 25%, according to the people.
• As its broader economy slumps, Chinese officials are leaning into clean-energy production in a bid to stimulate overall growth. During a trip to China last month, Yellen repeatedly warned officials in Beijing against the strategy, saying that the rest of the world will take steps to counteract a wave of inexpensive Chinese exports that undercut their own industries.

US Goods Trade with China

WSJ  5/11/24

YouTube Is a Rising Star For American TV Viewers

WSJ  5/15/24 

• Nearly 10% of the time Americans spent in front of TV screens last month was on YouTube’s flagship smart-TV app, Nielsen data show, a sign of continued transformation of the platform. Once a repository of amateur videos, the service owned by Alphabet’s Google has grown into a streaming behemoth with full-length films, highly produced series, sports highlights and live events.
• Today, 150 million people in the U.S.—more than 40% of the population—watch YouTube on connected-TV screens each month, a spokeswoman for the platform said. It has benefited from new features that let viewers shop or chat with one another while watching big events, like a livestream of last month’s Coachella Valley Music and Arts Festival.

Share of U.S. TV-viewing time

WSJ 5/15/24