US commercial real estate prices prices are down sharply this year with offices building prices down ~30%
On top of declining prices, there are nearly $1.4 TRILLION of commercial real estate loans coming due by 2025. Meanwhile, rates on the commercial real estate loans have more than doubled since they were issued. Last but not least, vacancies in commercial real estate are skyrocketing (which means rent revenue is down). The coktail of rising rates on loans that need to be refinanced and declining income looks like a rather toxic one. Source: The Kobeisi Letter
Rice likely to get even more expensive as India imposes additional restrictions
India further tightens rice exports as the government sets a floor price of $1,200 per tonne for basmati rice exports. India also imposes a 20% tax on rice sales abroad. Rice is a staple food for half the world. Source: Barchart, Bloomberg
Zillow expects U.S. home prices to jump by 6.5% over the next 12 months
Source: Barchart, Fortune
The US housing market affordability index is now ~10% BELOW the 2006 lows.
Even if prices fell 30%, housing affordability would still be above pre-pandemic levels. It’s a tough time to be a homebuyer in the US. Source: The Kobeissi Letter
China is more dependent on real estate than any other country
Almost 30% of Chinese GDP dependent on #realestate combined with 50 million vacant apartments is a dangerous mix. Source: FT
The fact that Chinese State property developers are also in big troubles complicates the issue for the China real estate
Mainly, as it reduces their ability to support the sector by taking over incomplete projects by private sector. Source: Bloomberg
Looking at the recent sales transactions, house prices have accelerated significantly in the last 4 months to record levels, now growing at almost a 10% annualized rate
As a remainder, shelter costs / rents jave been putting upward pressure on core CPI and are expected to ease. Really? Source: Tavi Costa, Crescat Capital, Bloomberg
Only 16% of Californians can afford to buy a home, a situation that is unfortunately not unique to the state, but where they are leading the way
Source: Markets & Mayhem, Bloomberg
