What I’m Reading
Chugging Along: The Zillow-Case Shiller Housing Price Forecast showed a 12% YoY increase in February, up from 11.2% in January, with the authors of the forecast commenting that there appears to be “no end in sight.” At some point, I have to imagine that rising mortgage rates will slow this down but we clearly haven’t reached that point yet. Either way, this seems bullish for the rental market (both SFR and apartments) which should experience upward rent pressure as affordability strains under the load of rising home prices and interest rates, and falling supply. Calculated Risk Blog
Buildout: Rural data centers could be the big beneficiary of $100 billion earmarked for broadband internet access in President Biden’s $2 trillion infrastructure proposal. Bisnow
Feeding Frenzy: Vacation home buyers made up a massive share of the mortgage market in 2020. However, Fannie and Freddie rule changes could make loans for these sort of properties more expensive. This chart is just, wow:
Tragedy of the Commons: Oversupply of NFTs is likely to eventually kill the boom, just as it always has in collectible markets with no limits on production. Marker
Narrative Buster: Because of its pollution and poverty, Fresno makes regular appearances on lists of America’s worst places to live. Yet since 2017, average rent for homes in Fresno is up nearly 39% to $1,289 a month, according to real estate firm Apartment List. That includes a 12% increase during the pandemic, the opposite of what has occurred in Los Angeles, San Jose and San Francisco, where rents have plummeted. Over the last four years no major US city has seen greater increases than the oft-overlooked central valley metropolis. LA Times
Nowhere to Go: Seniors are staying in their homes longer than ever and many have no desire to ever move to a nursing home. This is creating a major imbalance in the US housing stock as the Baby Boomer generation ages:
“By 2034, 34 percent of households will be headed by someone over 65, a jump from 26 percent in 2018, according to the Harvard center, and the share of households age 80 and over will grow even more rapidly. Yet in 2011, just 3.5 percent of homes had single-floor living, no-step entry and extra-wide halls and doors for wheelchair access, according to Harvard’s latest estimates.”
Chart of the Day
High yield spreads are near all-time lows.
Meanwhile, the market-based probability of a Fed hike in 2022 is approaching 90%.
Source: The Daily Shot
WTF
Drive Through: A heated fight outside of a Maryland Taco Bell resulted in a driver crashing his car into the restaurant. New York Post
Walk of Shame: A man who police saw strolling naked at 1am on a South Carolina street told officers that he was doing a “walk of shame” as penance for cheating on his wife. He then admitted to taking meth and tried to run away from deputies before being arrested. The Smoking Gun
Basis Points – A candid look at the economy, real estate, and other things sometimes related.
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