The Real Estate News Brief: The GDP, Inflation & Jobs, Slowing Rent Growth, and a New Salary Disclosure Law
Real Estate News: Real Estate Investing Podcast
Release Date: 10/06/2022
Real Estate News: Real Estate Investing Podcast
In this Real Estate News Brief for the week ending April 15th, 2024... why the latest inflation reports could postpone the Fed’s rate-cutting plan, how inflation continues to impact construction costs, and why homeowners are getting sticker shock from property tax bills. We begin with economic news from this past week that was dominated by two of the latest inflation reports. The Consumer Price Index or CPI came out on Wednesday and the Producer Price Index or PPI came out on Thursday. Unfortunately for everyone wanting a great inflation report, the March CPI was hotter than...
info_outline Will Squatters Take Your Property? New Florida Law Says “NO”!Real Estate News: Real Estate Investing Podcast
Florida Realtors are celebrating a new law that makes it easier for property owners to remove squatters. It’s become a crisis situation across the nation when squatters take control of a property and claim they are the victims. Florida has changed that, but property owners also need to protect themselves from the illegal occupation of their rightful homes... ...You should also know your rights and the rights of squatters (if they have any) for the area where your property is located. If squatters don’t leave when you ask them, you may have to file an eviction notice and...
info_outline Investors Enjoy Sizzling Hot Housing Demand in DALLAS!Real Estate News: Real Estate Investing Podcast
Demand for housing in and around Dallas, Texas continues to soar. While investors have been pouring millions of dollars into creating more affordable housing, the metro is attracting so many people that tens of thousands of homes are still needed. Supply isn’t expected to catch up to demand any time soon. An article in Bisnow says that investors have put a record amount of money into the area, but it hasn’t done much to close the affordable housing gap. Executive director of the Texas Affiliation of Affordable Housing Providers, Roger Arriaga, says: “The demand is excruciatingly...
info_outline The Real Estate News Brief: Rate Cut Predictions, Major Cities Attracting Home Buyers, AI’s Impact on CREReal Estate News: Real Estate Investing Podcast
In this Real Estate News Brief for the week ending April 6th, 2024... more prognostications on when the central bank may cut rates, which major cities are attracting the most home buyers, and why artificial intelligence could have a negative impact on commercial real estate. We begin with economic news from this past week. Fed Chief Jerome Powell expressed caution about when we might see the first interest rate cut. While many economists have been predicting three rate cuts this year with the first happening in June, Powell said it’s too soon to say exactly when it may be appropriate...
info_outline Beware of Scammers Who Use AI to Steal Real Estate!Real Estate News: Real Estate Investing Podcast
With the help of artificial intelligence, there's a new wild, wild west on the internet, where scammers are pretty much free to pick your pocket. Security experts are warning people that you can be scammed out of money or even real estate by deepfake audio or video clips. And there aren’t a lot of safeguards in place right now. The technology is evolving more quickly than security experts can design or implement safeguards. As reported by Bigger Pockets, scammers orchestrated a $25 million dollar heist by impersonating the CEO of a multinational company. Hong Kong authorities say the money...
info_outline The Real Estate News Brief: Another Hot Inflation Report, Rent Growth Turnaround, Fed Listening SessionReal Estate News: Real Estate Investing Podcast
In this Real Estate News Brief for the week ending March 30th, 2024...yet another hot inflation report that we shouldn’t worry about, a turnaround in rent growth, and criticism for the Fed about the impact of high rates. We begin with economic news from this past week. Another inflation report shows that we still have a few bumps in the road to deal with. The government released a report on the PCE for February which shows a sharp increase in prices. The Personal Consumption Expenditure Index was up .3%. That’s slightly below the .4% that Wall Street economists had predicted. The...
info_outline The Real Estate News Brief: Rate Cuts on the Horizon? Home Price Growth vs. Inflation & Indoor Camera Ban for Airbnb RentalsReal Estate News: Real Estate Investing Podcast
In this Real Estate News Brief for the week ending March 23rd, 2024... why the latest Fed meeting provided some assurance about potential rate cuts in the months ahead, what you would pay for a home if home price growth hadn’t outpaced inflation, and how Airbnb is dealing with the use of monitoring devices like indoor cameras. We begin with economic news from this past week. The Fed held rates steady at the March meeting this last week, and suggested that we’re likely to see “three” quarter-percent rate cuts this year. The current short-term interest rate is between 5.25% and 5.5%. If...
info_outline Study: Hundreds of Small Banks Still at Risk Due to CRE LoansReal Estate News: Real Estate Investing Podcast
Regional banks are still under pressure because of their exposure to commercial real estate loans. A new study shows that almost 300 banks are at risk of failure if they don’t get an infusion of cash or merge with another institution. And the risk grows as time drags on with higher short-term interest rates. Consulting firm Klaros Group analyzed about 4,000 banks. It found that 282 or more than 7% of the banks in the study are under stress, and that most of the ones at risk are community banks with less than $10 billion in assets. But it also found that 16 regional banks holding $10 and $100...
info_outline Japan Ends Long History of Negative Interest RatesReal Estate News: Real Estate Investing Podcast
For the first time in 17 years, Japan is hiking short-term rates from negative to positive. Japan has been battling deflation and economic stagflation since the worldwide economic crisis and was the lone hold-out among several countries experimenting with negative rates. This last week, that experiment ended with a rate hike from negative .1% to between zero and positive .1%. The Japanese economy has been suffering through a very long period of stagflation. This has been going on since the late 1990’s but the decision to lower short-term rates happened sometime after the 2007 to...
info_outline The Real Estate News Brief: More Inflation Concerns, Big Change for Home Sales, Single-Family Construction Hot SpotsReal Estate News: Real Estate Investing Podcast
In this Real Estate News Brief for the week ending March 16th, 2024... what the latest inflation reports are telling us, why home sellers might be jumping for joy, and where we’ll be seeing the most single-family construction. We begin with economic news from this past week. Two new inflation reports add to concerns about which way prices are going. The Consumer Price Index and the Producer Price Index both show prices were higher in February with the PPI showing the biggest surprise on the upside. The PPI represents the wholesale cost of goods and services and what we might...
info_outlineIn this Real Estate News Brief for the week ending October 1st, 2022... what’s up with the GDP, inflation and jobs, why rent growth is slowing, and a new law for California job seekers.
Hi, I'm Kathy Fettke and this is Real Estate News for Investors. If you like our podcast, please subscribe and leave us a review.
Economic News
We have plenty of economic news to report, but first, a few words about Hurricane Ian which has ripped across Florida and South Carolina. Our hearts go out to the families and communities who have been affected. Ian was one of the strongest hurricanes to hit the U.S. and serves as a reminder for homeowners with a high-risk of flooding to check their insurance coverage. (1) Flood insurance is getting more expensive, but it’s better than coming up short after a big hurricane. According to ValuePenguin, the average cost of flood insurance from the National Flood Insurance Program is $985 a year. (2)
The government’s latest revision on the GDP shows the economy shrank .6% during the first half of the year. That’s the same as the previous estimate, but as CNBC reports, there’s still a lot of disagreement on whether the nation experienced or is experiencing a recession. It’s widely believed that two quarters of negative growth defines a recession, but there are other factors to consider in today’s environment that don’t support that. The strong job market is one of them. With unemployment around 3.7%, some economists believe the economy is expanding. And many are predicting growth in the third quarter. There’s also concern that the economy could falter next year, as the Fed continues raising rates to control inflation. (3)
And that’s a big problem. The so-called personal consumption index for August shows a .3% rise in prices. Without food and gas, the core rate was .6% higher. That shows that inflation is still running hot and brings the annual rate of inflation for the PCE from 4.7% to 4.9%. That’s still lower than a 40-year high of 5.3% in February. (4) The Federal Reserve believes the PCE reading on inflation is more accurate than the CPI.
Last week’s jobless report shows that initial claims dropped to their lowest level in five months. Benefit applications were down to 193,000. The number of people already collecting unemployment benefits also dropped. The total is about 1.35 million. (5)
August was a good month for new home sales. The Commerce Department reports a 28.8% surge to a seasonally-adjusted annual rate of 685,000 homes. As reported by MarketWatch, that’s the second-biggest month-to-month jump in new home sales ever. It’s also a big reversal from July, when new home sales were down 8.6%, and full-year sales are expected to be down as much as 20%. Some economists attribute the August surge to home buyers rushing to get into a new home before mortgage rates rise any further. (6)
Existing home sales went in the other direction. The National Association of Realtors says that pending home sales were down 2% in August. Pending home sales only indicate the likelihood of a sale. NAR is expecting existing home sales for the entire year to fall 15.2%. But NAR’s chief economist, Lawrence Yun, expects more home sale activity in 2023. (7)
Home price growth is slowing down as mortgage rates get close to the 7% mark. The S&P CoreLogic Case-Shiller 20-city index was down .4% in July. That brings the annual rate of home price growth down from 18.7% to 16.1%. The national home price index was also down by a smaller .2%. The decline is reportedly the fastest decline in home price growth in the history of this index, and the first time that home price growth has gone down since February of 2012. (8)(9)
Mortgage Rates
Mortgage rates continue to rise. Freddie Mac says the average 30-year fixed-rate mortgage was 41 basis points higher last week, for an average of 6.7%. The 15-year was up 52 points, to 5.96%. Freddie also says there’s a wide range of weekly rate quotes, so it’s important to shop around if you’re looking for a home loan. (10)
In other news making headlines...
Asking Rents Are Climbing
Redfin reports that asking rents were up 11% year-over-year in August to a national median of $2,039 a month. That’s a record high, but it also represents a slow-down in rent growth. Rent growth peaked in March with an annual gain of 19%. (11)
Redfin economists expect the slow-down to continue as a result of a slower economy, and a boost in rental supply. As Redfin economist Taylor Marr points out: “There are nearly a million rental units under construction that will hit the market in the coming months and years.” But that’s still far fewer than the nation needs to meet housing demands.
California Job Ads to Include Salary Info
A new California law will make it easier for job applicants to know what they’ll get paid. Governor Gavin Newsom just signed a salary transparency bill into law. It requires that job postings include pay ranges, and applies to businesses with 15 or more employees.
A few other states have similar laws, but this makes California the largest state to require up-front salary information. The other states include Colorado which requires salary information in job ads, while Nevada, Connecticut, and Washington make salary information available to applicants.
The California law could help build momentum for salary disclosures. One big benefit is the potential impact on the gender pay gap. Currently, California women get about 88 cents on the dollar compared to men. The law goes into effect on January first. (12)
That’s it for today. Check the show notes for links. If you want to keep up with real estate news, please subscribe to this podcast. You can also find out more about how to find and purchase rental properties at our website (newsforinvestor.com). Just hit the “Join for Free” button at the top of the page, for access to our Learning Center and our Investor Portal.
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Thank you! And thanks for listening. I'm Kathy Fettke.
Links:
2 - https://www.valuepenguin.com/average-cost-flood-insurance