What I’m Reading
Overreach: The Biden administration on Tuesday announced a new, targeted federal eviction ban to replace the one that expired over the weekend despite recently admitting that it had no legal standing to do so thanks to an earlier Supreme Court decision. Politico
What strikes me as particularly egregious here is the fact that the president basically admitted that the courts will likely strike this down but he was going to act unilaterally anyway because it would take them time to do so. This comes as no surprise as I never though the ban would be allowed to lapse in the first place. So, once again hyperbolic headlines and small (but dramatic), self reported data sets win out over common sense – at least until this makes its way back in front of the Supreme Court. LOL if you think that this thing is going to be allowed to expire on October 3rd if the courts don’t intervene.
Highway to the Danger Zone: One consequence of the San Francisco pandemic exodus is that former Bay Area residents flooded into rural, more fire-prone areas. San Francisco Chronicle
Feeding Time: So far this year, $24.5 billion of commercial real estate CLOs have been sold this year, more than any full calendar year going back to 2014 as investors continue to look for yield anywhere they can find it. Perhaps even more interesting, the CLO market is outpacing the (typically) much larger conduit CMBS market which totaled $17.3 billion in sales through July 31. If you are wondering why spreads on bridge debt have compressed so substantially in 2021, this is your answer. The Wall Street Journal
Out of Balance: In the early days of the pandemic, housing began to boom thanks to extremely low supply and incredible low mortgage rates. Since then, the boom has largely been driven by a surge in demand according to a recent Federal Reserve research paper based on a stock-flow characterization of supply and demand in the housing market.. The Federal Reserve
Wait and See: We will know a whole lot more about the true employment situation once kids go back to school in a few weeks. Vanguard
Chart of the Day
All of the headlines you are reading about soaring rental growth focus on asking rents for new leases, not renewals – which are almost always substantially lower. It costs landlords substantially to turn units when a tenant moves out, both in terms of down time and readying a unit for new occupancy. Renewal prices currently trail wage gains. Yet another reason that I believe the hyperbolic headlines about a potential eviction crisis (before the administration reversed the moratorium) to be substantially overstated.
Source: Real Page
WTF
That’s Amore: Police responding to a 1 AM domestic disturbance found a couple “covered in spaghetti” following a physical confrontation that resulted in the pair’s arrest on domestic battery charge. (h/t Steve Sims) The Smoking Gun
Stowaway: An iguana that likely crawled through a sewage vent found its way into a family’s toilet because Florida. CBS Local Miami
Basis Points – A candid look at the economy, real estate, and other things sometimes related.
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