A trade group enduring a surplus of grief, a central bank that stopped punishing the public and a billionaire’s adieu to the Pacific Northwest. From the wild and wooly world of real estate, here are the hits and misses for the week of Oct. 30 to Nov. 3.
Miss: NAR at a Nadir. To borrow a line from the late Queen Elizabeth II, this could be the annus horribilis for the National Association of Realtors. This week’s courtroom loss in the Sitzer/Burnett case coupled with CEO Bob Goldberg’s earlier than expected departure (he announced his retirement in June with a late 2024 sign-off) significantly chipped away at the confidence in the organization – and the decision to bring in media executive Nykia Wright as interim CEO despite her lack of real estate experience left many baffled. Factor in the lingering residue of the scandalous media coverage from August regarding NAR President Kenny Parcell and 2023 is the year NAR would rather forget.
Hit: Remembering the Pause Button. Kudos to Jerome Powell and his Federal Reserve fun bunch for not following their worst instincts in regard to rate hikes. The Fed took a hint from the hit-the-brakes actions of the European Union and Canadian central banks in pausing the severe rate hike approach to taming inflation – the Bank of England also passed on a hike this week. Hopefully, this can soon become a new normal, to be followed by a backpedaling with rate cuts in 2024.
Miss: It Only Takes One Loan to Screw Things Up. The commercial real estate sector had its share of bad news this week when Trepp Inc. reported the commercial mortgage-backed securities (CMBS) delinquency rate rose 24 basis points in October to 4.63%, the highest level since the end of the Covid-19 pandemic. And if you thought the problem was fueled by the wobbly office market sector, you would be wrong. Trepp primarily attributed this spike to a $930 million industrial loan that showed up as past its balloon date and was not current on interest payments. Ouch!
Hit: Remembering Maui. While it often seems that the federal government has its priorities misplaced, at least the folks at the Federal Housing Administration (FHA) know how to respond to an ongoing crisis. The FHA extended its disaster-related foreclosure moratorium in Hawaii’s Maui County through May 6, 2024, for borrowers with FHA-insured single-family mortgages, including seniors with Home Equity Conversion Mortgages. The moratorium was originally set to expire on Nov. 8 – and while the devastation in Maui is no longer front-and-center in the daily news cycle, the residents of that Hawaiian island are still dealing with the wreckage created by this summer’s wildfires. Thanks, FHA, for coming through to help the good people in Maui.
Hit and Miss: Miami’s Gain is Seattle’s Loss. Amazon founder Jeff Bezos took to Instagram this week to announce he is moving out of Seattle after nearly four decades in the city. Bezos, who began Amazon in the garage of his Seattle home, noted he lived in Miami during his youth and his parents recently moved back there. He also noted the operations of his Blue Origin space company was “increasingly shifting to Cape Canaveral,” adding that “Lauren and I love Miami” (a reference to his partner, Lauren Sánchez). Bezos didn’t mention his recent purchase of a $79 million estate on South Florida’s Indian Creek Island or that he also owns residential property in New York City, Beverly Hills, Texas and Washington, D.C. While he claimed that Seattle “will always have a piece of my heart,” his departure is yet another demerit for a city that was once the epicenter of the digital revolution but is now better known for its woke politicians and none-too-safe streets.
Phil Hall is the editor of Weekly Real Estate News. He can be reached at [email protected].