From HousingWire:
Redfin: Middle class buyers are being priced out of housing market
Although housing inventory is increasing, affordability for the typical middle class household is retreating, according to new data from Redfin.
“Homeownership is increasingly out of reach for the typical American,” Redfin Chief Economist Daryl Fairweather said. “Over the last few years builders have focused on luxury homes, and there hasn’t been enough construction of affordable starter homes.”
Redfin calculated housing market data ranging from 2017 to 2018, focusing on the share of affordable active listings that were available to households making the median income across 49 metro areas.
In San Jose, just 14% of homes that were on the market in 2018 were affordable for those making the area’s median household income of $117,000. This is a significant decrease from 2017 when 26% of homes for sale were affordable, according to the company.
Redfin attributes this lack of affordability to gains in home prices and interest rates.
According to ATTOM Data Solutions’ latest affordability report, in the fourth quarter of 2018, the median home price reached its least affordable level since the third quarter of 2008.
“While poor home affordability continues to cloud the U.S. housing market, there are silver linings in the local data as home price appreciation falls more in line with wage growth,” ATTOM Data Solutions Senior Vice President Daren Blomquist said.
In fact, Redfin determined that although the share of affordable homes for sale in these 49 metros fell from 2017 to 2018, a few metros experienced growth in affordability.
These areas included Hartford, Connecticut, where the share of affordable homes grew 19%; Jacksonville, Florida, which increased 9%; and Nashville, where affordable inventory rose 4%.
Furthermore, Redfin notes homebuyers still have housing options in St. Louis, where 84% of homes are affordable to the typical buyer, and Minneapolis and Pittsburgh where 82% of homes meet the average buyer’s budget.
Fairweather said Redfin expects homebuilders to shift their attention to more affordable homes in 2019, which along with rezoning efforts by local governments should reduce this pressure to some degree over time.
first
So isn’t this simply indicative that with all the shortages of labor, wages are not keeping up and hence, some of the low unemployment data while statistically valid isn’t indicative of the real story which is good paying jobs are getting harder to come by?
Nomad,
You are seeing income inequality up close and personal. The entire market is catering to where the money is….the top(including foreign investors). It’s catering to all types of investors as opposed to home owners. So apartment buildings and high end luxury are the name of the game. People buying second or third homes on speculation because they have to do something with all that excess money….can’t put it all in equity market, so they dump it into real estate.
Yes, there are still regular buyers purchasing homes, but the description above has altered the market.
8:35 in related news water is still wet….,
In an absolutely epic Twitter thread (unrolled here) author CZ Edwards lays out an incredibly compelling explanation of spiralling real-estate prices: oligarchs need to launder a lot of oil money — think Russia, Iran, ex-Soviet basket-case states, Saudi — and so they plow the money into offshore Real Estate Investment Trust that then cleans it by outbidding any actual real-estate investors or would-be homeowners, bidding up and snapping up all the property in desirable cities, and then realizing the rental income-flows as legitimate, clean money.
It’s as neat and compelling a way of describing the link between oligarchy and spiraling real-estate prices as you could ask for. Shelter is not optional, so people will spend whatever it takes to get a roof over their heads. Cities are not infinitely sprawlable, so it’s possible to corner the market on places to live in them. Eventually, the parasites will devour the hosts and leave the cities empty shells (ahem, Venice), but by then the money-launderers have sold up and moved on.
And of course, since real-estate is a great way to launder money, real-estate developers are often mobbed up af, which explains a lot about the president and his grifter inner circle.
This is very true. Outside of FINCEN’s trial transaction tracking program in NYC, LA, San Diego, Miami and few other places is next to impossible to really track the movement of laundered money once you use a few seasoned off the shelves US & International corporations.
The whole reason is highly suspected Trump was money laundering is the a bevy of corporations he owned had account at Cyprus banks known to be used by Russian mob/intelligence. So all that was need to ensure payments was a discreet electronic transaction entered by “manager”.
“And of course, since real-estate is a great way to launder money, real-estate developers are often mobbed up af, which explains a lot about the president and his grifter inner circle.”
“And of course, since real-estate is a great way to launder money, real-estate developers are often mobbed up af, which explains a lot about the president and his grifter inner circle.”
The same goes for food and energy. That’s why companies that rent RE, sell food and energy love illegals. Can you imagine what would happen to their markets if you deported all of the illegals?
Shelter is not optional, so people will spend whatever it takes to get a roof over their heads.
As I drive east on Rt 3 I marvel at the growing number of slender and tall buildings rising in midtown, essentially bank vaults for the uber wealthy around the world….to either store wealth, or as previously noted, launder money. I guess at some point, well into the future, they will present some sort of problem.
The “smartest” thing that NYC started to do, first under Bloomberg, was to increase the property tax rates in NYC, property tax now brings in more revenue than the NYC income tax.
My brother’s 3/4 bdr house on S.I, now pays almost $7,000 in property, for someone with $200,000 in income, the city gets another $7,000 or so in income taxes….
History of LLCs used in NYC real estate.
https://therealdeal.com/issues_articles/the-rise-of-the-anonymous-llc/
No different than the Statue of Liberty. As long as they are maintained, they can stand as empty hulks.
1987 Condo says:
January 28, 2019 at 10:14 am
As I drive east on Rt 3 I marvel at the growing number of slender and tall buildings rising in midtown, essentially bank vaults for the uber wealthy around the world….to either store wealth, or as previously noted, launder money. I guess at some point, well into the future, they will present some sort of problem.
Way more opportunity for a NJ politician to grift off real estate deals than being the president.
How about High Property Taxes?
Redfin and so may other institutions like it don’t like to factor in that Property Taxes in most states are as high as having a 2nd mortgage. When you raise taxes, you screw the poor and middle classes because it ALWAYS gets passed down to them.
Property taxes on my “very simple and basic” 3 bedroom apartment in NYC are over $70K/year. Every time they get raised, the politicians are saying “we don’t want the poor and middle classes, here.“
Fake news generators from buzz feed and huff post have been let shlt canned. I guess the Russia hoax story isn’t generating clicks any more. Best news I’ve heard in a while.
Massive new condo development will be finished in two years with the conversion of the old Bank of New York headquarters at one wall street. Supposedly the top floor will have one of the most expensive asking prices ever.
Is RBG’s health the real reason Pelosi cancelled the State of the Union?
https://www.nj.com/news/2019/01/3d-maps-show-parts-of-nj-are-the-most-densely-populated-on-the-planet.html
The fact that Michael Dell purchased an 11,0000 ft2, $100m condo at One57 has little to nothing to do with affordability for the middle class.
What middle class?? Middle class in NYC is $200k per year –
Exactly. At $100m, $10m, or even $1m that space is out of their reach.
Anyone start their 2018 tax return yet. The $10k cap is not fun!
Keep telling yourself that. So Miami and sf became expensive because of middle class buyers competing in the market?
How many of the buyers for One57 will actually live there?
leftwing says:
January 28, 2019 at 5:48 pm
The fact that Michael Dell purchased an 11,0000 ft2, $100m condo at One57 has little to nothing to do with affordability for the middle class.
“Anyone start their 2018 tax return yet. The $10k cap is not fun!”
I am going to do mine in a week or so. Should be interesting,
Man, the last batch of spam bots are a headache.
Absolutely no similarities between bot posts, seemingly random IPs, random field entries, etc etc.
We are smarter than the bots! Well, most of us. Sorry Pumps.
Q: what is this?
Jim Dann says:
January 29, 2019 at 8:33 am
Nice to see your posts getting on the Star Ledger, Phil will bury NJ, including your real estate. I haven’t been to Grim’s website in years. It is good to see(read) posts from years long past. Is JJ still around? His posts were hilarious.
If you have a 10K cap on SALT and say, for an example, 20K on property taxes, how much of a hit would it be or what would be the difference before the cap was implemented? Is there a chart or link that illustrates the proportion of loss/gain?
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I’m surprised Libturd hasn’t commented on the Howard Schultz presidential bid yet.
I know he’s center left, which isn’t my political persuasion at all, but knowing nothing but his announcement speech I’d still take him over Trump or any harder-left Dem.
A fast short cut:
20K prop. taxes – 10k salt ded =10k no longer deductible
10k – your tax rate% = X
10k – X = amount of money higher than last year that you’ll pay Uncle Sam.
NOTsoFast
You forgot the delta based on the =2018 marginal tax rates
Wow. the website cutoff half the message, lets try it again:
You forgot the delta based on the =2018 marginal tax rates.
its still doing this, very strange, Grim. Please check it out. The text should read.
You forgot the delta based on the 2018 and 2018 marginal tax rates.
I give up. The damn service truncates anything after ‘less than’ sign
Let’s not forget that the brackets are lowered significantly. Let’s not play the card that the removal of the salt deduction isn’t offset by the new lower tax brackets. I’m paying almost 10% less…I’ll give up salt to make that trade any day of the week….and I pay high property taxes.
Not FastEddy says:
January 29, 2019 at 10:05 am
A fast short cut:
20K prop. taxes – 10k salt ded =10k no longer deductible
10k – your tax rate% = X
10k – X = amount of money higher than last year that you’ll pay Uncle Sam.
And don’t forget the boost to your stock holdings by the lowering of the corporate tax. If you lose salt, it’s not the end of the world. If they kept salt in place, we would be killing it, and the rise in future debt would be the price.
Let’s not forget that the AMT disallowed the state income tax and property tax deduction, so if you were “lucky” enough to be hit with that you may see a savings as they virtually eliminated those hit by the AMT.
Garbage dump on Tinton Falls-Colts Neck border making headlines.
https://www.nj.com/monmouth/2019/01/it-smells-worse-than-a-septic-tank-hundreds-of-angry-residents-turn-up-to-complain-about-local-dump.html
Dogs are psyched: “Thankfully, they like things that smell bad, so it doesn’t effect them in a negative way.”
Homeowners unhappy: “There’s no way I can sell, because it stinks every day.”
20K prop. taxes – 10k salt ded =10k no longer deductible
10k – your tax rate% = X
10k – X = amount of money higher than last year that you’ll pay Uncle Sam.
This doesn’t make sense to me. Give me an example with real numbers.
On Schultz – A little too much ego for me and though centrist, Starbucks caters to the extreme left. So he will be associated with the extreme left regardless of how he claims to be. Also, can we get someone who is not a fat cat. I can’t stand Starbucks. It’s just a giant facade to sell overpriced, burnt tasting coffee. I would fear that he would run the government the same way. It will be nothing but curtains and mirrors.
On the bright side, he is correct about the need for a combiner rather than another divider.
For very high earners, the loss of the deductibility of NJ state income tax fails is a bigger deal that the slightly lower federal bracket.
Net, it’s a federal income tax hike for NJ people making over half a million or so per year, and a net overall tax hike for this group in high tax states.
As I said when it came out, it’s not a tax break for high income individuals, other than those in Florida, Texas, Wyoming, and some other low/no income tax states. Unless you are in one of the special few lobbying groups/structures that are allowed to use the business tax rates rather than the individual tax rates.
I somehow didn’t get hit with the AMT over the past couple of years despite a high income. I hope they make this new tax law permanent or I have no chance of escaping the AMT in 2025. All the brackets go back to the old system after 2025 unless they renew it. Lots of people will get killed in 2026 if they don’t renew this tax law. You will not have salt, and you will have the tax system return to its normal tax brackets. Of course, the corporate tax cuts are permanent. Which is a huge gift to the 1% at the expense of everyone else.
1987 Condo says:
January 29, 2019 at 10:59 am
Let’s not forget that the AMT disallowed the state income tax and property tax deduction, so if you were “lucky” enough to be hit with that you may see a savings as they virtually eliminated those hit by the AMT.
Libturd,
I knew you’d hate Starbucks with its anti-cheapo ways of separating fools from their money.
Anyone not a “fat cat” will need the political machine money.
I suspect he’d have a better chance than Bloomberg in that niche.
I’ll wait until I see the full disappointing candidate lineup before making up my mind.
Top 1% generally don’t get caught in AMT because they already earn and pay higher rates than the AMT rate. Top 1% are making over $420k, well into the 35% marginal bracket, and those over $500k are into the 37% bracket.
In NJ it’s people who make $200k to $400k per year with big families and big mortgages who typically got into AMT – the not-quite 1% who feel poorer than they statistically are due to spending a high % of their incomes.
I hate Starbucks products and their fake, f.ucking philosophy on life.
Under the category of everything you needed to know….
Schultz is looking at an independent run because the Dems are too far to the LEFT even for HIM. Lol.
https://www.investors.com/politics/editorials/starbuck-howard-schultz-democratic-2020-elections/
re: can’t seell becuase “Garbage dump on Tinton Falls-Colts Neck border.” and “stench from the landfill across from her house”.
Landfill been there for longer than most of the homes and homeowners. I wonder how many asked about it when they were buying? Living off “Shafto road” Who the heck buys a home on a road called Shafto?
Lower your price and it will sell…..
I do like the idea of billionaires more concerned about legacy running for office over lawyers looking to fleece the system. Obviously not ideal but better than what we’ve got.
Eddie, burnt coffee was never my thing. I don’t drink much coffee but I need a quick one on the road I buy McDonald’s coffee because it is cheap and is not burnt.
After the debacle with Bernie/Her, I doubt any candidate not already entrenched in the Dem swamp, would even consider piggybacking on the DNC platform.
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Politics today are ridiculous. Candidates clamoring for redistribution just sounds like it’ll not really attract voters who actually show up at the polls.
“I doubt any candidate not already entrenched in the Dem swamp, would even consider piggybacking on the DNC platform.”
Lib, agree. I think the end game for the ultimate candidate is to remain outside the fray of what passes for the Dem party these days and then get ‘drafted’ late in the game. Few people have the ability to do it, most need the fund raising infrastructure and name recognition in place early to be viable (Gillibrand, Warren, Booker, etc).
Cuomo comes to mind as one who is conspiculously on the sidelines perhaps biding his time to get drafted (while not wealthy he can afford to do so because of name).
My guess is Schultz’s end game is to get his name out there as a serious candidate to complement his money. He’s not going to run as an indie. Fools errand, and while I intensely dislike the guy he is no fool. He’ll wait in the wings as an indie and seek to get drafted when the presumptive Dem ticket looks like a sh1t show.
Mark it down, you heard it here first. Cuomo or Schultz at the top of the Dem ticket, entry late in the game.
I do like the trend of examining wealth and perhaps stopping the instances of subsidizing already hugely profitable enterprises. That shit has got to stop.
Schultz is no Ross Perot.
“He’ll wait in the wings as an indie and seek to get drafted when the presumptive Dem ticket looks like a sh1t show.”…..sounds about right.
Perot knew wtf was up. His predictions and that “giant sucking sound” ring more true today than when he said them!!
I’m really concerned with where the mfg. base will end up once the trade wars end.
Typical Republican:
Gilmore, 69, of Toms River, was charged in a six-count indictment with one count of income tax evasion for the calendar years 2013, 2014 and 2015; two counts of filing false tax returns for calendar years 2013 and 2014; failing to collect, account for, and pay payroll taxes for two quarters in 2016, and making false statements on a 2015 loan application submitted to OceanFirst Bank, according to the U.S. Attorney’s Office.
The charges come more than two years after Gilmore’s lawyer, Chatham-based attorney Kevin Marino, acknowledged in an Asbury Park Press story that Gilmore was under federal investigation because of his income taxes.
Perot’s giant sucking sound was in response to the proposed NAFTA agreement. He debated Gore on CNN and Gore labeled Perot as a greedy billionaire only interested in maintaining a monopoly.
What a mistake it was not putting Perot in office. Guy nailed it. Our country would be much better off, but we chose the hard lesson instead.
Blue Ribbon Teacher says:
January 29, 2019 at 12:53 pm
Perot’s giant sucking sound was in response to the proposed NAFTA agreement. He debated Gore on CNN and Gore labeled Perot as a greedy billionaire only interested in maintaining a monopoly.
The major parties have too much to lose. They would pool together every last lobby dollar to make sure an independent does not have a chance. Now that does not mean, the right one could not make it through. Oprah and I’m certain many other celebrities of her ilk could march on through unsc@thed. Heck, Cardi B, could probably make a run at it and have a shot. Don’t forget. We elected Trump.
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I’m going to see a gay Broadway musical tonight with Gator. Wish me and the Choir Boys luck. Gator obtained the tickets on Broadway Roulette. What a really great way to see a show cheap! We’ll see if our seats are in the orchestra or behind a pole at 7pm.
20k prop tax – 10k SALT=10K no longer deductible
If your tax rate=25%, then 25% of 10k or $2,500 more on Fed Taxes
Schultz is okay. I don’t appreciate his take on China. Also, most other countries are out to pick America’s pocket and they hate (or are jealous) of us. He is too conciliatory to the world. I’d say fcuk everyone except Canada, UK, South Korea, and Japan. Everyone else needs to get their reverence in line with reality.
Can you run for office? Need more people that get it.
chicagofinance says:
January 29, 2019 at 2:10 pm
Schultz is okay. I don’t appreciate his take on China. Also, most other countries are out to pick America’s pocket and they hate (or are jealous) of us. He is too conciliatory to the world. I’d say fcuk everyone except Canada, UK, South Korea, and Japan. Everyone else needs to get their reverence in line with reality.
2:05 damn … when did Bruce come out…!?
I thought the “giant sucking sound” turned out to come from Monica Lewinsky in Bill’s office.
I hate to sound like a clown, and there is a lot of decent commentary here. However, the best answer to your question is to complete your taxes as soon as possible. These changes are such a moving target that only a complete data set will yield an worthy answer on which to rely.
Fast Eddie says:
January 29, 2019 at 9:33 am
If you have a 10K cap on SALT and say, for an example, 20K on property taxes, how much of a hit would it be or what would be the difference before the cap was implemented? Is there a chart or link that illustrates the proportion of loss/gain?
ChiFi,
I did a little search and came up with a good estimate. I have a ballpark figure and I appreciate all input from you guys.
I’m not sure Cuomo can even spell independent, or many other multi syllable words for that matter.
Details on US land price trends are out. Perhaps the most granular land price analysis ever done.
I zoomed in on the NJ data. Hudson County land prices are blasting higher, rising 81% between 2012 and 2017. Salem County ugliest, with land prices declining over same time period.
https://www.fhfa.gov/PolicyProgramsResearch/Research/Pages/wp1901.aspx
Anyone have any knowledge on this?
https://nypost.com/2019/01/28/well-have-a-cure-for-cancer-within-a-year-scientists/