What I’m Reading
Gorging: Homebuilders are buying up undeveloped lots at a frantic pace in an effort to meet today’s incredibly strong demand. However, that demand isn’t permanent and the land grab could lead to pain for those participating. Ivy Zelman sums it up perfectly:
“The biggest concern I have is the land grab,” Ivy Zelman, CEO of housing research firm Zelman & Associates, said on the most recent Walker & Dunlop Walker Webcast. “The majority of these homebuilders are going out and buying land and underwriting today’s record-high absorption and price growth. Those numbers are not sustainable, but builders are buying land as if they are.”
Ultimately Flexibility: Tech companies are offering coveted executives a new job – permanent remote work. Bloomberg
Magnet: Rental housing – both SFR and apartments have held up well during the pandemic (with a few noted geographical exceptions). As a result, capital is pouring into the space, compressing yields. While a lot of this is due to asset performance, some is certainly due to how relatively un-investible office, retail and hospitality are currently. Globe Street
Imbalance: Towards mid-2021 construction volume demand is anticipated to outpace labor supply, resulting in wage pressure and potential labor shortages. Cumming Consulting
Contingency Plan: Retailers are paying up to fly items from China in order to avoid shipping delays caused by backlogged US ports. CNBC
Chart of the Day
Demand for Treasuries is not projected to keep up with issuance.
Source: @RobinBrooksIIF
WTF
Hustle and Flow: A man wearing only one sock, boxers, and an undershirt who was arrested for speeding through crash site told arresting officers that he was late for a business meeting at the Ritz Carlton because Florida. NBC 2
Well Hidden: A Missouri woman arrested last month on drug and weapons charges had a small revolver hidden in a body cavity that went undetected during a strip search and two pat downs. The Smoking Gun
Basis Points – A candid look at the economy, real estate, and other things sometimes related.
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