What I’m Reading
Center of Gravity: While the Biden tax plan roiled markets over the past few weeks, corporate executives and lobbyists and lobbyists are confident that centrist Democrats in both the Senate and House will ultimately kill almost all of the proposed increases. Politico
Burn Out: Mortgage demand has hit its lowest level in a year after cash out refinances fell 13% month-over-month. This is all expected in an environment where we are coming off of the lowest mortgage rates in history. When it comes in mortgage originations, 2020 is likely about as good as it gets. The Real Deal
Status Quo: The IRS will not be expanding the boundaries of around 8,700 Opportunity Zones despite heavy lobbying from developers. The Real Deal
Compressing: As the pandemic comes to an end, increased buyer activity will likely result in further cap rate compression as sellers continue to hold off, often leading to bidding wars for the few available assets. Globe Street
Taking Over: When people say that the real estate market is insane in the US and can’t get any crazier, I increasingly find myself pointing to Canada. As of Q4, 2020, residential real estate accounted for a whopping 9.3% of the country’s GDP. For context, U.S. residential real estate investment peaked in 2006 at 6.7% of the country’s GDP and it currently sits at 4.3%. In addition, our affordability issues pale in comparison to Canada’s. This is absolutely not a model we should want to follow but it does make the case that the market can get substantially crazier. Visual Capitalist
Chart of the Day
Shot (fun fact: the US population is growing while this chart is falling)
Aaaaand chaser
Source: Goldman Sachs
WTF
Honest Mistake: A man hiking a Missouri trail was shot over the weekend by a hunter who mistook him for a turkey. The Kansas City Star
Anger Management: An “amateur porn star” was arrested for shooting a pellet gun at his ex girlfriend because Florida. The Tampa Bay Free Press
Basis Points – A candid look at the economy, real estate, and other things sometimes related. Visit us at RanchHarbor.com