Halfway there

Posted on November 20, 2021 by grim

From MSN:

House Bill Raises SALT Tax Cap; Senate Still To Vote

Among the items passed by the House of Representatives Friday morning in the Build Back Better Act was an increase in the state and local tax (SALT) cap.

The $2 trillion bill, which passed 220-213, increased the cap from $10,000 to $80,000. That would increase the amount that taxpayers can deduct from their tax returns.

The legislation now has to go to the Senate for approval.

The cap was set at $10,000 in 2017 federal Tax Cuts and Jobs Act passed during the Trump administration. Previously, taxpayers could fully deduct state and local taxes.

It was estimated that the reduced cap cost New York homeowners $30 billion, or $2,600 per home.

Posted in National Real Estate, Politics, Property Taxes | 66 Comments

“I really look forward to Republicans attacking me on restoring the SALT deduction for homeowners in my district”

Posted on November 18, 2021 by grim

From the Star Ledger:

Biden bill to bring back property tax deduction for most N.J. homeowners

Following President Joe Biden’s signature Monday on a $1 trillion bipartisan infrastructure bill, the House later this week is expected to turn its attention to a $1.75 trillion proposal that would restore most of the federal deduction for state and local taxes.

While still subject to further changes, the legislation scheduled for a vote by the end of the week would increase the amount allowed to be deducted up to $80,000 through 2030, with the $10,000 cap returning in 2031.

…

The second bill would also for one year also extend the expanded child tax credit for lower- and middle-class families, which was part of Biden’s $1.9 trillion coronavirus stimulus lawthat passed over unanimous Republican opposition.

According to a study released Monday by the Center on Budget and Policy Priorities, a progressive research group, the expanded credit would benefit 1.6 million children in New Jersey and lift 93,000 above the poverty line.

Another 388,400 working New Jersey adults without children would benefit from the bill’s expanded earned income tax credit, the center said.

…

In addition, two-thirds of those taking the deduction in New Jersey, the state with the nation’s highest property taxes, had income between $75,000 and $200,000, according to Internal Revenue Service statistics.

“I really look forward to Republicans attacking me on restoring the SALT deduction for homeowners in my district,” Malinowski said.

Posted in Economics, Employment, New Jersey Real Estate, Property Taxes | 264 Comments

LI hitting a wall?

Posted on November 17, 2021 by grim

From Long Island Business News:

Long Island home prices head lower again

The prices of Long Island homes dropped for the second straight month in October. 

The median price of closed home sales in Nassau County last month was $650,000, down from the $661,500 median price from September and the lowest since June, according to numbers from OneKey MLS. 

In Suffolk County, the median price of closed home sales last month was $520,000, slightly lower than the $525,000 median price recorded in September and also the lowest since June. 

However, the median prices in both counties are still significantly higher than a year ago. The median price of closed home sales in Nassau last month was 10.5 percent higher than the $588,000 median price from October 2020. 

The $520,000 median price in Suffolk last month was up 10.6 percent from the $470,000 median price recorded a year ago. 

Meanwhile, home sales remained brisk in October. 

There were 2,976 homes contracted for sale in Nassau and Suffolk counties in October, that’s up slightly from the 2,931 Long Island homes contracted for sale in September, but down 22.4 percent from the 3,831 homes contracted for sale in Oct. 2020.  

Pending home sales in Nassau climbed 10.6 percent from the previous month, rising from 1,239 in September to 1,373 last month. However, pending home sales in Suffolk saw a 5.3 percent month-to-month decline, falling from 1,692 in September to 1,603 last month. 

Posted in National Real Estate, NYC, Price Reduced | 163 Comments

Real estate is never normal

Posted on November 16, 2021 by grim

From the NYT:

Will Real Estate Ever Be Normal Again?

The third time Drew Mena’s manager asked him about relocating to Austin, Texas, he and his wife, Amena Sengal, began to seriously consider it. They had deliberated each time before, in 2017 and 2018, but landed on a hard no: Drew and Amena had lived in New York for more than 10 years, and they loved it. They owned a two-unit townhouse in the Bedford-Stuyvesant neighborhood of Brooklyn, and they felt lucky to have it, with its yard and the kind of close-knit neighbors who compete to shovel one another’s sidewalks after a snowfall.

But now it was August 2020, and the pandemic had changed their calculus. When the city shut down, their daughter, Edie, was 7 months old; Drew and Amena co-parented while working full time, one at the kitchen island, the other at the breakfast table. In May, they escaped to Drew’s family’s cottage in New Hampshire, and gradually their tether to the city began to fray. When the relocation offer came in from Drew’s employer, an asset-management company, they started browsing listings online, and it looked as if they could get a lot more space in Austin. They would certainly save money on everything else, like gas and groceries. The world is ending, they said to themselves. Why the hell not?

Posted in Demographics, Economics, Employment, National Real Estate | 189 Comments

Does expungement create labor market flexibility and economic benefit?

Posted on November 15, 2021 by grim

I’ve got to imagine nearly a million people in this region essentially locked out of labor market flexibility, now being able to seek out new/better jobs, etc – will have a significant benefit on local market economics and poverty rate. Thoughts?

From Gothamist:

NY & NJ Will Erase Nearly A Million Marijuana Convictions. For Some, Clearing Their Record Gets Tricky

Leon Sarvis was in college in 2008, hoping to become a gym teacher, when he said he was convicted in a New Jersey court on charges of marijuana possession and drug distribution for having a scale. Sentenced to two years of probation, he said he was fired from his job working with the disabled. And he gave up on the bachelor’s degree because he knew it wouldn’t help him get a job due to his criminal record.

“That obviously messed everything up,” Sarvis said. “So I had to change focus elsewhere. I drive trucks now—that’s a big field for a lot of people who have convictions.”

Until recently, marijuana convictions in New Jersey and New York posed barriers to jobs, education, even custody of children, particularly for Black residents, who’ve faced disproportionate police enforcement in the war on drugs. But since both states passed legislation legalizing the use of cannabis earlier this year, those convicted on marijuana charges now have an opportunity to wipe their records clean.

…

In New York, which legalized cannabis in September, 198,000 records have already been expunged and another 203,000 convictions are in the process of being expunged and no longer show up in background checks, according to state data.

“When completed, the actions of these measures will have expunged the records of over 400,000 New Yorkers, a staggering reminder of the impact that cannabis prohibition had on so many,” Alexander said.

In New Jersey, which legalized the drug in February, the state Supreme Court’s automated system has expunged, dismissed, or vacated 362,000 marijuana and hashish cases, including possession of marijuana and hashish, and distribution of less than an ounce of marijuana or five grams of hashish. Convictions for possession of drug paraphernalia and being under the influence of a controlled substance are also being removed from records if the cases are linked to marijuana offenses. And at least 1,200 people in the state have been released from probation.

In total, more than 750,000 marijuana convictions are being expunged in both states, wiped out as if the arrests never happened. But some charges may be more complicated to untangle. In New Jersey, for example, if someone faced a marijuana offense along with a non-drug charge, such as assault, the entirety of their criminal record will still be intact, requiring judicial review before such cases can be removed.

Posted in Economics, New Jersey Real Estate | 88 Comments

Quits skyrocket

Posted on November 13, 2021 by grim

From CNN:

A record number of Americans quit their jobs in September

A record 4.4 million Americans quit their jobs in September as the sheer volume of available jobs is empowering workers to have their pick.

Workers are quitting in search for better pay or better jobs, representing a fundamental shift in America’s labor market.”

Labor now has the initiative, and the era of paying individuals less than a livable wage has ended,” said Joseph Brusuelas, chief economist at RSM US. “This strongly suggests that rising wages are going to be part and parcel of the economic landscape going forward.”

The nation had 10.4 million open jobs that month as the worker shortage crisis continues, data from the Bureau of Labor Statistics showed Friday. It was a modest decrease from the 10.6 million open jobs in August.

Jobs particularly increased in the health care and sector and in state and local government.

“The Delta variant is still visible in the September JOLTS report,” said Nick Bunker, director of economic research at the Indeed Hiring Lab, in emailed comments. But he noted “we do know from the October jobs report that the labor market did get on more stable ground.”

The slowing demand for workers in the leisure and hospitality industry was the cause of the modest decline in available jobs in September. 

“The pace of people quitting across the labor market is remarkable,” Bunker said, “but the concentration among a few sectors is eye-popping. Quits are up the most in sectors where most work is in-person or relatively low paying.”

Posted in Economics, Employment, National Real Estate | 78 Comments

NJ #3 in post-pandemic foreclosures

Posted on November 10, 2021 by grim

From the Philly Inquirer:

Foreclosure starts tick up in Pennsylvania, N.J., and nationwide

Three months after the end of a federal foreclosure moratorium intended to keep people in their homes during the pandemic, foreclosure activity continues to increase across the region and nationwide.

Most foreclosure filings — including default notices, scheduled auctions, or bank repossessions — are on vacant and abandoned properties or loans that were in foreclosure before the pandemic, according to real estate data provider Attom. The moratorium covered about 70% of the nation’s mortgages and about 80% of Philadelphia’s home loans.

Other policies preventing lenders from starting the foreclosure process will expire at the end of the year, when many homeowners will exit forbearance plans that allowed them to delay mortgage payments during the pandemic.

Last month, lenders started the foreclosure process on about 10,800 properties nationwide. That’s up 5% from September and more than double the number of foreclosure starts in October 2020, according to a foreclosure market report that Attom is to release Wednesday.

From September to October, Pennsylvania and New Jersey were among the states with the biggest increases in foreclosure starts.

New Jersey had the third-highest rate of foreclosure activity in the country last month and has consistently been at the top of this list. One in every 3,438 housing units in the Garden State had a foreclosure filing, compared with a rate of 1 in 6,675 nationwide, according to Attom. Only Illinois and Florida had higher rates of foreclosure filings.

Posted in Economics, Foreclosures, New Jersey Real Estate | 362 Comments

Ivy calling Kool-Aid again

Posted on November 8, 2021 by grim

From the Real Deal:

Strong housing demand a mirage, says analyst who called previous crash

Everyone seems to be betting the house on a new home these days. Multibillion-dollar private equity firms. Joe Schmo house-flippers. Even savvy tech firms.

Everyone except Ivy Zelman, that is. The analyst who called the top of the housing market in 2005 is once again waving a red flag. It’s beyond contrarian: She’s pretty much in a category of one.

“The perception that housing is drastically undersupplied and that a strong demographic picture lies ahead is creating a false sense of security,’’ according to a report by Zelman’s firm entitled “Cradle to Grave.’’ “By our math, both single-family and multi-family production are already ahead of normalized demand and estimates of a housing deficit are grossly exaggerated.’’

Posted in Demographics, Economics, National Real Estate, New Development | 241 Comments

NJ (closer to) getting SALT tax relief

Posted on November 6, 2021 by grim

From CNN:

Congress passes $1.2 trillion bipartisan infrastructure bill, delivering major win for Biden

Congress has passed a $1.2 trillion bipartisan infrastructure bill, delivering on a major pillar of President Joe Biden’s domestic agenda after months of internal deliberations and painstaking divisions among Democrats.

The final vote was 228-206. Thirteen Republicans voted with the majority of Democrats in support of the bill, though six Democrats voted against it. 

The bill now heads to the President’s desk to be signed into law, following hours of delays and internal debating among Democrats on Friday, including calls from Biden to persuade skeptical progressive members of the Democratic caucus.

The legislation passed the Senate in August, but was stalled in the House as Democrats tried to negotiate a deal on a separate $1.9 trillion economic package, another key component of Biden’s agenda that many Democrats had tied to the fate of the infrastructure bill.

The legislation will deliver $550 billion of new federal investments in America’s infrastructure over five years, including money for roads, bridges, mass transit, rail, airports, ports and waterways. The package includes a $65 billion investment in improving the nation’s broadband infrastructure, and invests tens of billions of dollars in improving the electric grid and water systems. Another $7.5 billion would go to building a nationwide network of plug-in electric vehicle chargers, according to the bill text.
…

In a sign that a deal is getting closer, House Democrats have also resolved another sticking point: How to deal with state and local tax deductions, according to multiple sources familiar with the matter. Democrats from the Northeast and West Coast have been pushing to loosen the caps imposed by the 2017 tax law.

Under the new SALT deal, deductions would be capped at $80,000 per year over a nine-year time span, according to Rep. Tom Malinowski, who helped cut the deal.

Posted in Economics, Politics, Property Taxes | 90 Comments

Mansions or Middle Class?

Posted on November 4, 2021 by grim

From the Star Ledger:

Your N.J. property tax break would be restored under Biden spending bill

New Jersey homeowners would be allowed to deduct the full amount of their property taxes for the next five years under a provision expected to be included in President Joe Biden’s $1.75 trillion spending bill that expands health coverage, funds child care and preschool and fights climate change.

The provision would end the $10,000 cap on deducting state and local taxes from this year through 2025, when the limit is scheduled to expire anyway under the Republican tax law, according to a person familiar with the provisions who could could not speak publicly about the deal before an official announcement.

While 61% of the benefits of a full repeal would go to those earning more than $200,000, 66% of those using the state and local tax deduction in 2019 made less than that, according to the Joint Committee on Taxation.

Many of those middle-class homeowners live in New Jersey and other high-tax states, most of which send billions of dollars more to Washington than they receive in services.

Earlier in the day Rep. Josh Gottheimer, D-5th Dist. tweeted that there was a deal on SALT but provided no specifics.

“Great news! Here come tax cuts for New Jersey families!” Gottheimer said on Twitter. “Reinstating the State and Local Tax (SALT) deduction will be in the final legislative package. Now, we need to get it to the floor for a vote. We’re going to get this done.”

Still, the full repeal ran into opposition from Senate Budget Committee Chair Bernie Sanders, I-Vt., later in the day.

“What we should not be doing is repealing the SALT for people with mansions who are billionaires,” Sanders told reporters at the Capitol. “You can’t talk about taxing the wealthy and end up giving them massive tax breaks.”

Posted in Economics, New Jersey Real Estate, Property Taxes | 245 Comments

So who is our governor?

Posted on November 3, 2021 by grim

From the Star Ledger:

N.J. election 2021: N.J. governor race still too close to call. Murphy, Ciattarelli waiting for all votes to be counted.

The bitter race for New Jersey governor didn’t end on Election Day.

In a shocker, the contest, once seen as a shoo-in for Gov. Phil Murphy, remained too close to call Wednesday. Results this morning show the Democratic governor and Republican challenger, Jack Ciattarelli, less than 1 percentage point apart, teetering on a razor thin margin in a race that surprised many and burst into the national spotlight.

Posted in General | 193 Comments

Found the inventory!

Posted on November 2, 2021 by grim

From Business Insider:

Zillow is reportedly looking to sell 7,000 homes as its homebuying unit hits turbulence

Zillow’s homebuying unit is having a rough couple of weeks.

The $25 billion property giant spent the past couple of years buying up thousands of homes through Zillow Offers, its instant buyer, or iBuyer, arm. 

The bad news started rolling in October 17, when it announced that it would stop buying homes for the remainder of 2021. Jeremy Wacksman, its chief operating officer, said it was because of “an operational backlog for renovations and closings” that he blamed on “a labor- and supply-constrained economy inside a competitive real estate market.”

That move sent the stock plummeting, as investors had bet on Zillow Offers as a big driver of company revenue. 

Insider then reported October 28 that the majority of its homes in its five biggest markets, in places like Atlanta, Phoenix, and Houston, were listed for less than what Zillow paid to purchase the homes. The numbers were particularly striking in Phoenix, where it’s listing more than 90% of the properties for less than it paid. 
…
“They’re clearly losing money on homes, and the margins will be worse this quarter,” Erickson told Insider’s Daniel Geiger. “They’ll have to write down some of their inventory.”

Posted in Economics, National Real Estate, Price Reduced | 133 Comments

Slow but strong

Posted on October 30, 2021 by grim

From NJ Business:

NJ Home Sales Cool, Prices Remain Hot for Fall

High prices and low inventory have continued to cool sales throughout New Jersey. While New Jersey saw a slight decline in closed sales the past few months, overall sales are up 13.6% since the start of the year.

“For the past two years, the housing market has been an anomaly for a number of reasons,” said 2021 NJ Realtors President Jeff Jones. “The return to a more balanced market after almost a full two years of this competitive, in-demand atmosphere will be slower than potential buyers want and, likely, faster than those on the fence to sell will expect.”

Single family closed sales were down 17.5% in September 2021, to 7,756. Townhouse-condo closed sales were down 8.1% to 2,479, and adult community homes followed suit with a decrease of 14.4% to 729. Yet despite fewer sales, median sales price increased again across all categories in September. The single family median sales price increased 7.3% to $440,000; the townhouse-condo median sales price increased 5.1% to $310,000; and adult communities median sales price increased 26.4% to $303,330.

While listings are down year-over-year, the year-to-date new listings for all markets is down just 1.2% over the same period last year, which points to the market making up ground this fall, when new listings are typically lower.

The number of single family homes for sale remains low, but is still above the historical low of this past winter, which had the lowest number of homes for sale in over a decade, if not more. In September, there were 18,863 single family homes for sale throughout the state, representing a 26.1% decrease, which is typical of the decreases of the past three months.

Posted in Demographics, Economics, New Jersey Real Estate | 139 Comments

Nothing to see here

Posted on October 27, 2021 by grim

From the MPA:

Which housing markets have been most vulnerable to COVID?

The housing markets in Illinois, New Jersey and Delaware counties are more vulnerable to the impact of the ongoing coronavirus pandemic than elsewhere in the US, according to a report by property analytics firm, ATTOM.

The 2021 Special Coronavirus report released last week highlighted county-level housing markets vulnerable to damage from the ongoing COVID-19 virus in the US during the third quarter, based on the percentage of homes facing possible foreclosure, among other factors.

The conclusions were drawn from an analysis of the most recent home affordability, equity and foreclosure reports prepared by the property database curator. Counties were ranked in each category, from lowest to highest, with the overall conclusion based on a combination of the three.

The report revealed that New Jersey, Illinois and Delaware had 26 of the 50 counties that were most exposed to the potential housing-related impacts of the pandemic.

Of these, eight were in the Chicago metropolitan area (Cook, De Kalb, Du Page, Kane, Kendall, Lake, McHenry and Will counties), seven in the New York City metropolitan area (Essex, Hunterdon, Monmouth, Ocean, Passaic and Sussex counties in New Jersey and Rockland County in New York), and two in Delaware – Kent County (Dover) and Sussex County (Georgetown).  

Posted in Demographics, Economics, Foreclosures, National Real Estate | 362 Comments

Hot or Not

Posted on October 25, 2021 by grim

From Bloomberg:

Housing Market Shows Cracks With Price Cuts in Pandemic Boomtowns

No city exemplifies the mania of the Covid-era U.S. housing market better than Boise, Idaho, where prices have surged by more than 30% in the past year. But in a sudden reversal, buyers are now the ones with power. 

Asking prices for houses are being slashed. Bidders no longer have to waive inspections to win over sellers juggling multiple offers. Demand has slowed so much it’s like a light switch suddenly turned off, said Dominic Zimmer, a local Realtor.

“You’re seeing the fear of missing out switching from buyers to sellers,” Zimmer said. “Now sellers are afraid of not scoring the way they saw their neighbors do a year ago.”

The cracks in one of the nation’s hottest housing markets mark an early sign that the U.S. boom — fueled by low mortgage rates and remote-work moves — is losing intensity. While much of the country is still seeing record price increases and plunging listings, in some destinations builders who could hardly put up homes fast enough now have inventory sitting. 

The slowdown is particularly pronounced in areas away from major urban hubs where buyers were seeking affordability and picturesque havens during the pandemic. That demand has ebbed as people have more reasons to stay put this fall, with the return of in-person school and more companies ordering workers back to the office, or at least requiring them to be somewhere in the vicinity. 

Posted in Demographics, Economics, Employment, National Real Estate | 219 Comments