Why are homes so expensive in Canada?
Source: Wall Street Silver, The Economist
44% of office loans carry outstanding loan balances higher than the property value and are at risk of default according to a paper from the National Bureau of Economic Research
Source: Barchart
A record 85% of Americans now say it's a bad time to buy a house, according to Reventure
Two years ago, just ~30% of Americans thought it was a bad time to buy a home. Even in 2008, during the worst housing crisis of all time, this metric did not top 85%. In a market with high rates and supply levels 40% below the historical average, affordability is at all time lows. Source: The Kobeissi Letter
Billions of commercial real estate debt mature this year
Unlike US home loans, CRE debt is almost entirely interest-only. Borrowers tend to have low monthly payments but face a balloon payment equal to original loan on maturity. Source: Dabiel Baeza, TS Lombard
Homelessness in the US has grown to the highest level since the Department of Housing and Urban Development (HUD) started tracking the figure back in 2007
With a record 653,104 people experiencing homelessness at the latest annual count. The number of people experiencing unsheltered homelessness — those living on sidewalks or in abandoned buildings, bus stations, etc. — was up around 47k from last year, while the figure for people staying in emergency shelters, transitional housing programs, or safe havens grew 23k in the same period. Source: Chartr
After 2 years of the most aggressive FED rate hike cycle since the 1980s, the price of US houses (3 years change) is rising at the fastest pace in 40 years...
that sounds a bit counterintuitive at first glance as most surveys show that the housing affordability is at record low Source: BofA
An overview of European real estate price indices by Bloomberg / HolgerZ:
A shortage of housing has led to record real estate prices in ireland. The national property price index has now reached a value of 170.0, which is 3.9% above its bubble peak in April 2007. Property prices have increased by 113% in past 10yrs. Recent Dublin riots exposed the anger of Irish Youth facing a housing crisis resulting from the high housing & rent prices. Note the decline in German house prices (in purple) and steady markets in Italy / Portugal / Spain.
Here's one illustration of the US commercial real estate market meltdown: values of commercial real estate continues to get destroyed in Chicago...
A 155k SF office building in Chicago just sold for $17 million, or $109 per SF The seller took a huge 61% loss, paying $44 million for the building in 2017 Here's a worrying snippet from Crain's: "Thanks to remote work and higher interest rates, real estate investors can buy downtown office buildings on the cheap these days. Add a motivated seller trying to unload all of its office stock and the discount gets even steeper. Many office properties in the heart of the [Chicago] are now worth less than the mortgages tied to them, fueling a historic wave of distress." It will be interesting to see how bad the US commercial real estate meltdown gets (particularly in office) but it's certainly a story to keep an eye on in 2024 as big opportunities emerge". Source: TripleNetInvest
