This week’s Interest Rate (45th Week)
(By Fairway Home Loan )
30 yr fx(%) | 15 yr fx(%) | FHA(%) | 10 yr Tr Y (%) | |
A year ago | 2.875 | 2.375 | 2.625 | 0.886 |
A month ago | 3.090 | 2.237 | 2.750 | 1.605 |
Last week | 3.100 | 2.375 | 2.750 | 1.538 |
This week | 2.999 | 2.250 | 2.625 | 1.434 |
Prime Rate:3.0% / Ref IR: 0.00- 0.25%
- 3% Down payment for 1st home buyer is available.
- 5% Down payment 2-4 units FHA program available
- 15% Down payment 2 families -conventional program available.
- Potential home buyer — Have a pre-approval first before the shop. Now we have 48hour underwriting turn-around times for regular loans.
- 2022 Conventional loan limit:
Conforming SFR : $625,000/ Conforming high balance: $937,500 /Confirming 2 Family: $702,000/ Conforming High Balance: $1,053,000
Amazon will lease “Harborside 1” building in Jersey City
(Korea Daily 11/9 )
- According to Bloomberg News, Amazon will lease 400,000 sf office space in “Harborside 1” in Jersey City, NJ, which is Mack-Cali building. In fact, when Amazon failed to move in LIC, NY last time for their 2nd HQ, New Jersey had offered $500M tax benefits to Amazon to attract them to NJ.
- Amazon bought the Lord & Taylor building in Manhattan where 2000 employees work, and leased a building at 10th Ave near Hudson Yard. Also, they opened distribution center in Carlstadt in NJ (460,000 sf), Lawrence township in Mercer County (340,000 sf), and Edison in Middlesex County (290,000 sf) in 2020.
- Amazon had invested a total of $14.5B in New Jersey after 2010 and about 49,000 jobs have been created through their operation in New Jersey.
LG provides “lifeline”(Donation) to Cresskill School district
(Record 11/10 )
- In the weeks since the remnants of Hurricane Ida devasted Cresskill Middle/High school on 9/1, students and parents have been pleading for help getting back into a real classroom. But with high costs and a lot of red tape, the reopening of the high school appears to be a long wat off.
- LG donated a dozen 75-inch TV sets for use at St. Therese of Lisieux Church, where the district is renting temporary classroom space. It also donated $25,000 to the district.
- Cresskill Superintendent Michael Burke was surprised by the $25,000 gift and said that it could help with renting other buildings to house approximately 1,000 students. “The funds are incredible, which is beyond generous. This leaves me speechless.”
- The building, built on marshland in the 1950’s, was inundated with 3 feet of water, which caused walls and doors to buckle and damaged wiring. The water destroyed the auditorium, gym, media center and countless desks and chairs.
- The district is still looking for other buildings to place students in. The problems come with the building being “educationally approved”.
Not Many Gas Stations in Manhattan
(Korea Times 11/8 )
- In the world, the price of land in Monaco is the most expensive: about $6200/sf. Hong Kong, London and Singapore follows and NY is the 6th
- In Manhattan, land price is about $2800/sf which is the treason that there are not many gas station in the Manhattan. There were only 30 gas stations in the past between 11th St and 51st St, but now they are reduced to 1/3. It is much more lucrative to sell the land and let them build tall buildings.
- In Manhattan, building owners can buy and sell Air Right so that building owner buy the next building’s left-over Air Right and build his/her building higher than the legal limit, which the NYC allowed since 1961.
Zillow Went Big, Now It Has to Down
(WSJ 11/4 )
- While the company’s flop in home flipping doesn’t necessarily mean iBuying industry is doomed, but it highlights the risk. Sometimes a ruler gets too ambitious and has to fall on his own sword.
- In a shareholder letter Tuesday, Zillow described the so-called iBuying business as too risky, too volatile, too narrow and ultimately, too low on potential returns to continue. Proof is an unprofitable third Qt in which it took a $304M write-down on inventory – the result of “unintentionally purchasing homes at higher prices than our current estimates of future selling prices.”
- After Zillow’s flips flopped, is the whole iBuying industry dead in the water? If so, competitors are doing an impressive job of keeping matters under wraps.
- Despite Zillow’s experience valuation homes over the past decade and a half, it turns out that physically buying and selling them is a different ballgame. The industry, moreover, is one to which Zillow was relatively late. By the time Zillow went big on iBuying, pure players Opendoor and Offerpad, for example, had been playing at algorithmic home flipping for several years.
(WSJ 11/10)
- Investors are stepping up their scrutiny of remaining competitors, Opendoor technologies Inc. and Offerpad Solutions Inc., the two biggest players left in the iBuying industry after Zillow Group Inc. pulled the plug on this business.
- “What this is going to do is create a wake-up call for the other iBuying platforms to say, ‘if we are going to remain in the flip business, what do the margins look like?’ “ said Nick Bailey, president of Re/Max Holdings Inc., a real estate brokerage franchiser, and a former vice president at Zillow.
Single-Family Homes, Building or Renting, Are a Hot Investment
(WSJ 11/10)
- Single-family homes built to rent are emerging as the hottest corner of the U.S. property market, as investors respond to booming demand from home-seekers priced out of housing for sale. Rents on homes are rising faster than ever. New household formation is increasing the demand for rentals, as more young people get their own places.
- Traditional home builder like Lennar Corp. and D.R. Horton Inc. have made building rental houses a major component of their business. Giant investment firms like KKK & Co. and Blackstone Group are piling up cash to add already-built rental houses to their portfolios. Crow Holdings, a company with a background in apartment construction, is considering testing the sector, starting with two proposed projects near Dallas and Austin.
- Some analysts and builders are starting to believe the breakneck pace of growth in the sector is unsustainable. Investors are stepping over each other in Sunbelt markets like Phoenix, analysts and builders saying, risking a glut. Land sellers are raising their asking prices.
High Home prices keep marching till the end of next year
(Korea Daily 11/6 )
- Goldman Sacks forecasted that home price will go up 16% till the end of 2022. Home price was up about 20% this year and strong demand will continue to the next year because of still low mortgage interest rates.
- The reasons of that forecast are 1) competitive mortgage interest rates 2) unbalanced supply-demand of housing market 3) Investors’ interests into the market, etc.
- As inflation rises, investors will invest to more housing market in order to lower their burden, which will push home price upward.
- One way to help the situation is loosening the zoning and entitlement regulation, but it is not easy for government and congress together to implement the idea. Also, it is not clear to see a proper grant and assistance for housing policy from the government budget waiting the final approval currently.
GE Breakup Marks End of an Era
(WSJ 11/10 )
- Company that symbolized U.S. manufacturing power splits into three pieces. General Electric Co., the company that for more than a century stood as a beacon of U.S. manufacturing might and management prowess, will split into three public companies focused on aviation, healthcare, and energy, drawing the curtain on an era of business – the dominance of industrial conglomerates.
- GE had 174,000 employees at the start of the year, down from more than 300,000 a few years ago. While still one of top makers of jet engines and power turbines, it no longer males consumer products and has exited banking world. It has a market valuation of $120B, compared with roughly $600B at its peak in 2000, at the time the most valuable company in U.S.