Danielle DiMartino Booth Melody Wright Daniel McNamara At what point can we call this a parabolic move in South Florida condo inventory?

“It’s not the buyers that aren’t qualifying. It’s the buildings that aren’t qualifying.”

wsj.com/real-estate/lu…

cc Melody Wright Daniel McNamara

Weekly Pipeline Update

Summary
Loan origination side of things still brutally slow. The only multifamily deals brokers are hounding me on are effectively 100% LTV and 'SOFR 500 range will play'.

Both debt and investment sale brokers starting to discuss the need for 'creative'…

Q1 3008 first reported as negative in July 2009.

Job losses began in 2023’s third quarter. Layoff announcements have departed from seasonal patterns and accelerated into spring. Households awareness of weakening job market evident in University of Michigan surge in expectations for unemployment to rise, double the norm for the any given month.

'166-page inspection report...noted problems in virtually every part of the home. Missing pipes, doors installed incorrectly, insulation too thin, the structural integrity of the roof compromised, and multiple code violations were all noted within the inspection'

H/T: TAG 🦅

The Recession Is Already Here, Argues Danielle DiMartino Booth with Jack Farley of Forward Guidance
Watch this one for the content and the surprise! with @jackfarley96

hubs.ly/Q02wM8270

Not sure if you guys are watching rentals, but in the area I follow we went from literally less than 10 to nearly 200 and it just keeps rising along with price cuts.

🚨99-UNIT, NEWLY BUILT APARTMENT FORECLOSURE SALE IN DC

- $41.4mm loan balance (~$418K per unit).

- Construction began in 2018

- Building delivered in 2021

- The building was developed as condos; however, it is being leased out as rentals

- Given they are condos, each…

Melody Wright Annie Danielle DiMartino Booth There are several startups looking at mortgage defeasement models that would allow the current market value of a 3% mortgage to be split with the borrower. The bank: 'refi from a 400K 3% to a 400K 7% and we will give you 40K. Split the proceeds with your buyer.

Melody Wright Annie Danielle DiMartino Booth The biggest issue with non-banks is that they will stop lending when the model goes upside down. It's like the so called 'Basis trade' that the big hedge funds do. They stop when they feel like it. Banks will be sitting on the sidelines like' what do you want us to do?'

Got Build to Rent?

California has the highest unemployment rate in the nation and we expect that it advanced higher in April

Our Unemployment Radar updates when the state-level data is released later this month

#MacroEdge

Humbled to be in such great company.

MNI SOURCES: Fed, Geopolitics, Feed ECB Caution Over Cuts marketnews.com/policy/central…

Annie Danielle DiMartino Booth So the biggest issue with the nonbanks is that when default starts to rise which is happening now, their expenses will go through the roof. The GSEs will make them repurchase defaulted loans....it's a vicious cycle where liquidity runs dry quickly

Self-driving company Motional eliminated 40% of its workforce, or 550 employees

The ratio of the Conference Board Leading Employment Index and nonfarm payrolls has historically been a great Business Cycle indicator.

In April, the ratio declined further, continuing to signal a labor picture that is slowing more than the headline coincident data like nonfarm…

cc Melody Wright

Danielle DiMartino Booth University of Michigan I would imagine what could behind this are two forces: 1) hiring budgets are frozen and that’s leading folks to worry about what’s around the corner; and 2) education industry hands out contracts in May typically in our area. The post-pandemic stimulus aiding education ran dry…