What I’m Reading
Pressure Valve: Last year, home prices soared across the US while rents stagnated, thanks to a large amount of vacancy in big cities. Now there are signs of price exhaustion in the for sale market and rent versus own ratios have become extremely skewed. As a result, we are seeing the upward pressure of housing costs transfer to the for-lease market where rents are spiking across the country. Bloomberg
Quote of the Day:
There’s a lot of hidden leverage in the world – tiny things that seem inconsequential but operate in a tightly wound system where one flaw can bring everything down. – Morgan Housel
Halted: The EB5 program won a big victory last week when a judge struck down a Trump administration rule that increased the minimum investment from $500k-$900k. However, the victory was short lived as a battle in the Senate over re-authorization of the program hit an impasse that will not be resolved before Congress goes on leave for July 4th. As a result, the program will expire June 30th and new EB-5 investment will be halted until lawmakers come back to the table and hammer out an agreement. The Real Deal
Space Race: New second quarter data from the American Institute of Architects and Yardi Matrix reflect demand for more space increasing dramatically among both homebuyers and renters. Globe Street
Competitive Edge? UBS Group is planning to allow about two-thirds of its employees work from home for part of the week after they return to the workplace. The Swiss multinational investment bank believes that the move will give it an edge over rivals with more rigid office attendance policies. UBS’s move should provide a good A/B test as to whether work from home is viable long term for investment banks. If it is, and UBS is able to poach top talent from rivals, the implications for CBD office markets will not be good. The Real Deal
Chart of the Day
What I find most interesting about the big recent shift in sentiment is that Robert Shiller won a Nobel Prize for proving that exactly the opposite is supposed to happen as prices rise.
Source: JBREC
WTF
Mild Overreaction: After realizing that dipping sauce was not included with his Chicken McNuggets order, an Iowa man called his local McDonald’s and threatened to blow up the restaurant. The Smoking Gun
Packing Heat: A Tennessee couple is facing attempted murder charges after they allegedly opened fire at Burger King employees following a dispute “over a spicy chicken sandwich” which they claimed was too hot. The Smoking Gun
Basis Points – A candid look at the economy, real estate, and other things sometimes related.
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