April 6th – Take My Money

What I’m Reading

Take My Money: Yield-chasing investors are snapping up single family homes, competing with homebuyers and driving up prices.  The wave of institutional capital hitting this space is massive and has created an environment where prices are rising much quicker than incomes, prompting JBREC to issue a report concluding that:

Limited housing supply, low rates, a global reach for yield, and what we’re calling the institutionalization of real-estate investors has set the stage for another speculative investor-driven home price bubble.

They also concluded that this “bubble” has room to grow, despite inflating quickly.  ITs funny looking back to the not too distant past – like within the past two years, when equity investors still wanted to see a cap rate premium for purpose-built SFR over traditional apartments.  Those days are long-gone now.  

The Wall Street Journal

No One In Charge: Despite the rapid rise of electric vehicle sales in recent years, there is still no such thing as a true EV charging network in the US.  Instead, we have a complicated patchwork of plugs and proprietary software.  Mass adoption is nearly impossible without some form of standardization.  Vice

Under the Radar: While the Suez Canal blockage got all of the headlines, the backlog at the Ports of Los Angeles and Long Beach is actually causing longer delays.  Bloomberg

Unquantified: A new report from Fitch raises questions about whether or not the rental assistance under the American Rescue Plan will keep apartment vacancies low, thanks to a lack of data about the magnitude of delinquencies.  Globe Street

Boxed Out: The mortgage market is on a tear when it comes to origination volume.  However, credit availability is actually near its lowest level since 2014, meaning that it is very difficult to actually obtain a loan if you have anything less than pristine credit.  Wall Street Journal

Out and About: The combination of high adoption rates for pets during the pandemic and economic reopening has led to a bull market in dog walkers who are seeing a substantial uptick in demand.  MSN

Chart of the Day

High yield spreads are at multiyear lows as the spike in treasuries is not really showing up in higher risk yield securities yet.

Image

Source: The Daily Shot

WTF

Honest Mistake: A zoo was caught trying to pass off a Golden Retriever as an African Lion because China. Asia One News

Jacked Up: A man who was performing Botox treatments has been arrested and charged with practicing or attempting to practice medicine without a medical license.  He was also known for pounding Four Loko during patient consultations because Florida.  News 4 Jax

Basis Points – A candid look at the economy, real estate, and other things sometimes related.

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