Weekly News (November 1, 2023)

Mortgage Interest Rates Review

United Mortgage Nation  11/1/2023

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

People speak Korean after English and Spanish

영어, 스패니쉬 다음으로 한국말을 많이 사용…

WSJ  10/31/23

• The 3rd most popular language is Korean in Manhattan K-Town, Murray Hills, Rose Hills, and Ridgewood in Queens after English and Spanish language, according to the Visual Capitalist on 28th.
• In general the 3rd most spoken language is Chinese language in NYC after English and Spanish.
• Overall, Korean language is the 3rd most popular spoken language in GA and VA after English and Spanish.

Easy to convert Commercial to Residential

상용 건물 주거용 전환 쉬워진다

Korea Daily  10/28/23

• The Fed Government is supporting commercial building converting to residential to ease house supply in the market.
• The Fed Government will support local governments and developers to get lower rated financing up to $3.5M if they satisfy certain conditions such as allocating low-income units and low-carbon foot print.
• Also The Fed Government announced “the federal guide book of commercial conversion to residential” to ease use variances.
• In NYC, Flatiron building, former the Fuller building, 22 story, 285 ft high, at 175 5th Ave, New York, NY will be converted to 40 luxury residential units. 

Strong Job Market, Savings, Home Values Keep Spending Robust

좋은 노동시장, 저축, 주택가 등이 계속 소비 주도

WSJ  10/20/2023

• Americans’ prolonged spending spree has confounded economists and resulted in a surging U.S. economy. What is keeping their feet off the brakes?
• A strong labor market, resilient savings stockpiles and rising values of their homes have consumers feeling good and willing to spend. Despite complaints about high prices, they are taking their children to concerts, packing movie theaters, booking luxury vacations, buying cars and covering the costs of rent and dinners out.
• While it is hard to pinpoint exactly how long Americans will hold on to the excess savings, many economists say those funds are part of why consumers have continued to spend freely.

Spending in September, change from a year earlier

WSJ  11/1/23

Home Sellers Win $1.8B after Jury Finds Conspiracy Among Realtors

집주인들 승소: $1.8B 받게 될…

WSJ/NYT   11/1/23

• The influential National Association of Realtors and several brokerages were ordered to pay damages to home sellers who said they were forced to pay excessive fees to real estate agents.
• The verdict could lead to industrywide upheaval by changing decades-old rules that have helped lock in commission rates even as home prices have skyrocketed—which has allowed real-estate agents to collect ever-larger sums. It comes in the first of two antitrust lawsuits arguing that unlawful industry practices have left consumers unable to lower their costs even though internet- era innovations have allowed many buyers to find homes themselves online.
• This verdict is by far the group’s biggest setback yet. There are nearly 1.6 million Realtors in the U.S.

• The brokerages such as Home Services of America, KW Realty, Anywhere Real Estate(Former Realogy: CB, Century 21, Sotheby’s International) Re/Max holdings were also defendants.

• Re/Max and Anywhere settled paying $55M and $83.5M respectively before the trial while NAR, KW, Home Services went to the trial in Kanas City.
• Brokerages Stocks slid Tuesday: EXP down 8.7%, Compass down 6.2%, Redfin down 5.7%.

What can happen in the future

– NAR’s reaction àNAR, KW will appeal.

– The president of NAR, Tracey Kasper said “We remain confident we will ultimately prevail” and “This verdict does not require a change on our rules”.

– NAR spokesman, Mantill Williams said the case will not be settled for several years.

– Former president of NAR, Kenny Parcell resigned last summer due to the sexual harassment case.

– More law suits by sellers(Redfin, Compass, eXp,Douglas Elliman) à The damages could top $40B. ( Redfin existed NAR last week)

– Buyer will face more obstacles in a already challenging market(KW)

– Seller will have harder time realizing home values(KW)

– Sellers will pay their side commission and buyers will pays buyer side commission à Buyer need more closing costs beyond downpayment, or forego hiring agents.(NAR)

– Buyer can negotiate buyer side commission.

– Overall, residential commission can be lower than current commission.

– RE Agents will be ever more focusing to listing representation than buyer representation à more difficult situation for regular home buyers.

– More focusing on commercial and business transaction.

– Need more improvement of RE services : Knowledge, Specialties, Investment Strategies, Property Management, etc

– Diversified clientele group : Baby boomers’ liquidation à Alternatives to 1031 exchanges (Young) First Home buyers’ downpayment strategies

– Business development center: Helping Incubating, growing, buying/selling.