What I’m Reading
Exodus: More California companies have already moved their headquarters out of the state this year than in all of 2020. While businesses often attribute their California exit to regulations like high taxes and increasing utility costs, other reasons may sound similar to individuals leaving the state, such as cost of living and housing affordability. These numbers are likely a vast undercount of how many businesses are leaving the state, as it’s not often reported when small businesses choose to leave California. SF Gate
Twilight Zone: The economy is booming but far for normal. Restaurants are short on staff and long on wait times. Prices have spiked for food, gasoline and many services. Shoppers are struggling to find used cars. Retailers are struggling to hire. Beach towns are jammed with tourists, but office towers in major cities remain ghost towns on weekdays, with the promised return of workers delayed by a resurgent coronavirus. New York Times
End of the Road: Almost 9 million people are poised to lose their unemployment benefits this weekend, when federal pandemic-era policies will end. Absent of congressional action, that aid will lapse after Saturday or Sunday, depending on state administrative rules. Lawmakers seem unlikely to extend the policies for a third time given improvements in the economy and labor market in recent months. Will be very interesting to see what the impact is on our incredibly tight labor market. Stay tuned. CNBC
Picking Up the Slack: Single family home rental rates are outpacing even those in the apartment sector. The sharp rise partly reflects increasing demand from people who can’t afford to buy homes. Wall Street Journal If you think this is crazy, just wait until mortgage rates go up.
Pulling the Plug: Sam Zell’s real estate investment trust Equity Commonwealth said Tuesday it was terminating a merger agreement with Monmouth Real Estate Investment Corp. after Monmouth’s stockholders didn’t approve the deal. As a result, Equity Commonwealth will remain 85% in cash, still looking for a big play. Monmouth also received a bid from Starwood, which may or may not be revived. MarketWatch
Chart of the Day
Over the past 40 years the number of sole-person households in the US has almost doubled, and the share of total households has climbed about five percentage points. A combination of population growth, household shrinkage and too little new construction is putting tremendous upward pressure on home prices and rents.
Source: Leonard Kiefer
WTF
Hold Your Fire: A new program is seeking to reduce gun violence by paying people not to shoot one another because San Francisco. Newsweek
Fake it Till You Make It: A purportedly fake high school football team allegedly lied to ESPN in order to get on national television. The best part of this story is that it actually worked. ESPN
Basis Points – A candid look at the economy, real estate, and other things sometimes related.
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