Real Estate News: Real Estate Investing Podcast

Lumber has become a sizzling hot commodity during the pandemic, and when commodities sizzle, so does the price tag. The cost of lumber has shot sky high since April, and that's adding thousands on to the cost of new homes and renovations. For some, it isn't a matter of price. It's a matter of whether you can get the lumber you need. In a report by Fortune, research by Random Lengths shows that lumber prices have soared 134% year-over-year due to a lumber shortage and high demand. www.NewsForInvestors.com

In this Real Estate News Brief for the week ending August 29th, 2020... the Fed unveils a new monetary policy that will allow higher inflation, home sales surge to the highest level since 2006, and the FHFA announced a delay in the new fee on refinance loans. We begin with economic news from this past week, and a new inflation control strategy from the Federal Reserve. Fed officials unveiled the new policy this last week after approval by all 17 committee members. The Fed will now shoot for an "average inflation target" of 2%. www.NewsForInvestors.com

The pandemic isn't the only reason that demand is growing for single-family rentals, but it is one of them. And with an already tight supply of existing homes that can be turned into single-family rentals, the build-to-rent strategy is gaining momentum. There's a new report out from RCLCO Real Estate Advisors that says that demand for single-family rentals will likely outstrip supply for the next ten years, creating "a strong opportunity" for developers, builders, and investors. www.NewsForInvestors.com

The CEOs of Fannie Mae and Freddie Mac are responding to a massive backlash over an unexpected refinancing fee. In a letter to lenders, they wrote that the uproar was unwarranted, saying it won't make much of a difference to a homeowner's monthly payment. And the fee will help the mortgage guarantee companies continue their work of helping others. If you haven't heard of the fee yet, it's a half point surcharge on the cost of a refi that takes effect on September 1st. For the average $280,000 refi, that's about $1400 added into the amount that is being financed. www.NewsForInvestors.com

In this Real Estate News Brief for the week ending August 22nd, 2020... home sales are soaring, rent collection is near normal, and Airbnb bans party homes. We begin with economic news from this past week, and lawmakers that are still battling it out over a new stimulus package. An agreement could be reached soon that includes another $1,200 stimulus check, but the two sides are still about $1 trillion apart on the total amount of a deal. Still being debated are the unemployment bonus, the extension of eviction moratoriums, and new funding for schools and local governments. The Republicans are calling their proposal the Heals Act while the Democrats are calling theirs the Heroes Act. www.NewsForInvestors.com

The job market is undergoing a big transformation right now because of the coronavirus. Many businesses have adopted work-from-home policies, for at least the near term, to keep the virus from spreading at the office. The situation has raised questions about whether we'll see businesses resurrect an upgraded version of the office workspace, and for one big company, that answer appears to be "yes." www.NewsForInvestors.com

We typically steer away from politics in this podcast but a change in the presidency could bring about tax changes that impact real estate investors and high-income taxpayers. Some of our listeners have requested a podcast on what Democratic nominee Joe Biden is proposing if he becomes president, so I thought I'd dedicate this podcast to what we know of his plan. www.NewsForInvestors.com

The death of a California real estate investor has uncovered what appears to be a 30-year-old Ponzi scheme and hundreds of victims who don't know if or when they'll get their money back. Kenneth Casey died suddenly of a heart attack in May which led to a post-death audit and the discovery of financial irregularities at his two companies. In addition to an SEC investigation, investors are now hoping that a bankruptcy filing will help them recover some of the millions that they have invested. www.NewsForInvestors.com

In this Real Estate News Brief for the week ending August 15th, 2020... a new pandemic low for jobless claims, the kind of homes that are pricing higher, and a poll on the future of Social Security. We begin with economic news from this past week, and a stalemate in Congress over a new round of stimulus relief. Both sides are blaming the other for the hold-up while millions of Americans are coming up short on money they need to pay bills. www.NewsForInvestors.com

Refinancing your home just got more expensive. In the midst of the current mortgage refinancing boom because of low rates, Fannie Mae and Freddie Mac just announced a new half point fee. They say it's the result of market uncertainty, but real estate and mortgage industry leaders say it's a money grab that's happening at a very bad time for homeowners. The Federal Housing Finance Agency announced the fee on August 12th saying there would be a new half point fee on most loans backed by Fannie and Freddie starting next month. www.NewsForInvestors.com

Millennials are now the largest generation, and their homebuying years are underway, but they are behind the eight ball when it comes to having the money to purchase a home. Born between 1981 and 1996, they are dealing with their second financial crisis, and many haven't recovered yet from the first one. According to some financial experts, this second career slump could keep them from generating the same kind of wealth as past generations. It may also keep many of them in rental housing for much longer than they expected. www.NewsForInvestors.com

In this Real Estate News Brief for the week ending August 8th, 2020... some positive news about mortgage rates, a new disclosure rule for landlords, and where people "hide out" at home. We begin with economic news from this past week that is highlighted by negotiations in Congress for a new economic stimulus package. At the time this podcast was written, the two sides were at an impasse, the $600-a-week unemployment bonus had expired, and eviction moratoriums were ending. www.NewsForInvestors.com

As millions of Americans remain out of work and forbearance programs expire, there are new predictions about a surge in foreclosures. An analysis by ATTOM Data Solutions shows that foreclosures could more than double in the next year because of delinquent loan payments. The analysis includes best to worst case scenarios with the middle case showing a rise from 145,000 current foreclosures to about 336,000 in quarter two of next year. www.NewsForInvestors.com

If you are a real estate investor, you've probably thought about climate change and how it may impact your portfolio. We've been warned about rising sea levels, storm surges, more severe hurricanes, and more destructive wildfires, but one future risk that hasn't gotten as much attention is the risk of a water shortage in areas that don't get much rain or snow. According to a new risk assessment study by the Blackrock Investment Institute, it's a financial risk that many investors may not be factoring into their portfolios. www.NewsForInvestors.com

In this Real Estate News Brief for the week ending August 1st, 2020… we have a sharp drop in the gross domestic product, a real estate market that defies gravity, and a new way to feel like you are taking a vacation with your laptop. We begin with economic news from this past week, and a new record for the U.S. GDP, but not in a good way. The government says the gross domestic product dropped a whopping 32.9% from April to June, on an annualized basis. That's the worst drop in GDP ever, with the closest being in mid-1921. www.NewsForInvestors.com

The pandemic is changing the way people think about money, and how much they feel they need to be wealthy. The Charles Schwab 2020 Modern Wealth Survey was taken in January of this year, before the U.S. was hit by the pandemic, and again in June, several months after the pandemic began. The results reveal changes in both attitudes and behavior, when it comes to money. More than half of the people who participated in the survey say COVID-19 has had a financial impact on them or a close family member. But the sudden economic uncertainty that the pandemic has created, is also having a good effect on how people are handing their money. www.NewsForInvestors.com

If you've thought about buying real estate in a self-directed Roth IRA but would like to get more money into that account, 2020 may be the year to do a Roth IRA conversion from a traditional IRA or 401k. The conversion will trigger a tax event, but due to current circumstances, you might save a bundle of money doing that conversion this year. www.NewsForInvestors.com

Millions of U.S. properties are at substantial risk of flooding, and some say that risk is growing due to climate change. But it hasn't been easy to determine a property's flood risk. Many states don't have flood history disclosure requirements, and FEMA maps don't tell the whole story. A non-profit academic research group hopes to close that information gap with a new visualization tool that calculates flood risk for 142 million properties across the U.S. www.NewsForInvestors.com

Demand for warehouse space is skyrocketing as more and more people shop online, and that is providing another option for struggling malls. Mall owners with vacant space on their hands or retailers with an online presence are turning retail space into warehouse space for e-commerce. And there's plenty of room for this trend to fly. A new report from commercial real estate services firm JLL says we may need another 1 billion square feet of warehouse space by 2025. www.NewsForInvestors.com

In this Real Estate News Brief for the week ending July 25th, 2020... numbers surge for both new and existing home sales, first-time homebuyers may get penalty-free access to retirement accounts, and critics pounce on Airbnb's request for donations. We begin with economic news from this past week, and a real estate market that is not bogged down by the coronavirus. The Commerce Department reported that the pace of new home sales surged 13.8% in June. That's the highest level in 13 years. www.NewsForInvestors.com

An Iowa landlord got caught in an impossible situation. He said "yes" to an emotional support dog, and that dog ended up bothering another tenant who had allergies. The allergic tenant sued because she rented the apartment with the understanding that no pets were allowed, and the court sided with her because she was there first. The case itself has an important lesson for landlords dealing with the conflicting needs of its tenants. This has not been an easy dispute to resolve. The case worked its way to the Iowa Supreme court where Chief Justice Susan Christensen acknowledged that the landlord got himself into a "pickle" trying to satisfy the needs of both tenants. www.NewsForInvestors.com

A crowdfunding company that raised hundreds of millions of dollars from thousands of investors appears to have fallen into a black hole. Prodigy Network was already on shaky ground financially when founder Rodrigo Niño died a few months ago. And now, it's not clear who's running the company. The website is still blazing a message of prosperity, but calls and emails are going unanswered. www.NewsForInvestors.com

In this Real Estate News Brief for the week ending July 18th, 2020... home construction is booming for a second month in a row, mortgage rates are at a 50-year low, and drive-in theaters are popping up across the country. We begin with economic news from this past week, and a housing market that is rebounding nicely from the pandemic. The Commerce Department reported that housing starts continued a surge that began in May. They were up 17.3% in June, after a 17% increase in May... www.NewsForInvestors.com

If you want to stretch your real estate investing dollars as far as you can, you may want to look at Detroit. Motor City is the number one large metro for the amount of residential square footage you can get for your money. You might run into some competition as a summer buyer however. There are reports that the Detroit real estate market is booming right now, despite concerns about the pandemic. www.NewsForInvestors.com

Mortgage rates have never been this low. Freddie Mac reported on July 16th that the average 30-year fixed-rate mortgage fell below the 3% mark to just 2.98%. That's the lowest they've been in the 50 years that rates have been tracked. Those low rates are great for buyers, but they are also the results of the current crisis. Mortgage rates tend to drop when investors pour money into the 10-year U.S. Treasury bond. When there's more demand from investors buying up Treasurys, bond prices rise as yields go down (just like in real estate, when prices rise and cash flows decline). Investors who typically buy bonds also buy mortgage-backed securities for the same reason -- for safety, even if the return is lower. www.NewsForInvestors.com

Multi-millionaires around the world are renewing their call for a wealth tax. This time, they say it's needed to help heal the world from this pandemic. There are 83 ultra-wealthy individuals who signed an open letter this last week, asking their respective governments to raise taxes for people like them. They call themselves "Millionaires for Humanity" and say this tax should be imposed "immediately, substantially, and permanently." www.NewsForInvestors.com

In this Real Estate News Brief for the week ending July 11th, 2020... new record-low mortgage rates, where rents are rising, and what to expect from home prices. We begin with economic news for the past week, and some progress on getting back to work. The Labor Department reported that initial jobless claims hit a seasonally-adjusted four-month low of 1.31 million. That's down from 1.41 million the week before last. Those figures don't include benefits handed out through a temporary federal-relief program or state programs. If you include those figures, the total number of people receiving benefits is more like 31.5 million. www.NewsForInvestors.com

Businesses large and small lined up for the government's Paycheck Protection Program, and now many of them may be lining up for an audit. The program was designed to help companies that were hurt by the coronavirus with loans that are forgivable if employees are kept on the payroll. But loans were approved quickly, without a lot of documentation, and now many businesses may have to prove that they truly meet the loan criteria, or give the money back. www.NewsForInvestors.com

Two national reports on rent collection show that most tenants are meeting their rent obligations, although the results are slightly lower than last month. Eviction moratoriums are also being lifted in some markets, making it possible for landlords to address a difficult financial situation with an eviction, if needed. The National Multi-Housing Council keeps track of rent collection for apartments. In the Council's rent collection report for July, it says that 77.4 percent of renters made a full or partial rent payment by July 6th. Property managers usually give renters five days to pay their rent, so they can report "on time" payments by the 6th. www.NewsForInvestors.com

The latest jobs report shows a stunning 4.8 million jobs were added back into the economy in June. That's on top of 2.5 million jobs that were added in May. Both represent the two biggest monthly gains in U.S. history. Although they "shattered expectations" as the White House wrote in a headline, there's more to know about the status of the current job market. The COVID-19 pandemic that shut down our economy put 22.2 million people out of work during the first two months of the crisis. The addition of 8.3 million jobs in the last two months is an impressive turnaround, but it still leaves millions of formerly employed people without a job. www.NewsForInvestors.com

In this Real Estate News Brief for the week ending the Fourth of July 2020... market optimism after a report on pending home sales, good news about jobs, and a new FICO score that could help borrowers with below-average scores. We begin with economic news from this past week, and a report on pending home sales that sent the stock market soaring. They were up a record 44.3% from April to May, according to the National Association of Realtors. That's the largest monthly increase ever. It also followed two months of serious declines, but is evidence of what some economists say will be a "V"-shaped recovery for the housing market. www.NewsForInvestors.com

If you have gold in your financial portfolio, beware of any holdings connected to Kingold Jewelry. It's now at the center of a massive gold fraud scandal. And what adds another layer of intrigue is the company's location, in Wuhan, China, which is the epicenter of the current pandemic. The gold scandal is not connected to the pandemic, but is it creating new shockwaves connected to China. According to a report by Zero Hedge, 83 tons of fake gold were used to secure loans and insurance policies for Kingold. The gold is supposed to be worth 16 billion yuan or about 2.2 billion dollars but it was discovered that the gold bars were just gold-plated copper. It's believed to be the biggest gold counterfeiting scandal in recent history. www.NewsForInvestors.com

The pandemic is giving many of us "shakephobia." Shaking hands is a common way to express good will and is often used during the closing of a business deal. It's also a great way to spread germs, and maybe not a wise thing to do as the coronavirus spreads. I thought I'd dedicate this podcast to ways you can avoid a handshake without offending the person you are greeting. The handshake has been around for a long time. The message a handshake delivers is one of trust, respect, equality, and, in business, agreement. www.NewsForInvestors.com

It's headline news for residential real estate. The National Association of Realtors is reporting a mammoth 44.3% increase in pending home sales for the month of May. That's after a decline during the previous two months when the pandemic was at its peak. Economists see this as a sign of a "V-shaped" recovery that could help lead the economy out of the current recession. The market for existing homes was pretty much at a standstill for two months. Sellers didn't want to list their homes out of fear of the selling process -- that buyers touring homes would bring germs. Stay-at-home orders also kept the number of buyers to a minimum, especially those who wanted to see a home in person before they signed on the dotted line. www.NewsForInvestors.com

In this Real Estate News Brief for the week ending June 25th, 2020... new home sales are surging, real estate investors are feeling optimistic, and a home buyer priority that can make or break a sale. We begin with economic news from this past week, and some promising signs for the housing market. The government reported a big surge in the sale of new homes in May. They were up a seasonally-adjusted annual rate of 16.6%. In May of last year, they were up 12.7%. The Northeast experienced the biggest increase. Sales were up 45.5% in that region. The national median sales price for a new home is $317,900. www.NewsForInvestors.com

Efforts to eliminate signs of racism have swept across the country. From the toppling of confederate statues to the retiring of the Aunt Jemima image by Quaker Oats, individuals and businesses are getting rid of racist symbols. The word "master" is something that's used in the real estate world to describe the main bedroom in a house. In one city, realtors have decided to replace that word on the MLS because it "can" invoke thoughts of slavery. The Houston Association of Realtors stopped using the words "master bedroom" and "master bathroom" on June 15th. Instead, the association is describing those rooms as "primary bedroom" and "primary bathroom."

If you're in the market for a single-family home, chances are you'll have competition this summer. Searches for single-family homes have surged as many more people clamor after the privacy of a home with a yard in the midst of this pandemic. A Redfin report says interest in single-family homes hit a four-year high last month. Tampa is at the top of the list for an increase in single-family web searches, probably due to things like Florida's great weather, low home prices, low taxes, and a friendly business environment. www.NewsForInvestors.com

In this Real Estate News Brief for the week ending June 20th, 2020… competition heats up among home buyers, mortgage rates hit a new low, and what tenants are doing to manage their finances. We begin with economic news from this past week, and testimony from Fed Chief Jerome Powell on the state of the economy. He told members of Congress that some economic data points to a "modest rebound" right now, but he also warned of significant uncertainty about how the recovery may take place. The nation is still at the mercy of COVID-19 as cases rise in some states and new safety measures are put in place. Several states and cities have ordered that masks are worn in public, including California. www.NewsForInvestors.com

There are big changes to the Paycheck Protection Program that benefit independent contractors and sole proprietors. The changes include more lenient requirements for how you spend the money, an easier process for loan forgiveness, and a longer period of forbearance. But the deadline to sign up is approaching at the end of the month, so if you haven't applied yet, the clock is ticking. The deadline to sign up for the Paycheck Protection Program is currently June 30th. That didn't change in the latest update. The changes were authorized in legislation called "The Paycheck Protection Flexibility Act of 2020, which was sent to President Trump's desk for final approval on Friday, June 5th. www.NewsForInvestors.com

The Fed has launched a new lending program to help struggling companies and get people back to work. The Main Street Lending program was announced in March to help small to medium businesses that were doing well before the pandemic, and it's rolling out now at local banks. The loans are not forgivable like those in the Paycheck Protection Program but the terms are generous, and they do fill a lending void for businesses that were too big to qualify for the PPP program. The Federal Reserve Bank of Boston is administering the $600 billion program, but loans are provided through local banks that have registered to participate... www.NewsForInvestors.com

In this Real Estate News Brief for the week ending June 13th, 2020… the Fed's plan for the economy, why small businesses are optimistic, and a sudden surge in short-term rental reservations. We begin with economic news from this past week and word from the Fed that the federal funds rate will probably stay right where it is, at zero, for the next couple of years. Fed Chief Jerome Powell said in a news conference after the mid-year meeting: "We're not even thinking about raising rates." He didn't mention negative rates either which is something that other countries have done. Powell also said the Federal Reserve would use a "full range of tools" to support the economy. That includes the buying of Treasuries and mortgage-backed securities to provide lending liquidity to the market. The Fed's current balance sheet is about $7 trillion dollars. www.NewsForInvestors.com

The killing of George Floyd by a Minneapolis police officer unleashed anger across the country over the mistreatment of Blacks throughout American history. Inequality can manifest in many ways and in many parts of our culture, despite laws that outlaw discrimination. Our housing and financial markets are no exception. Although the practice of redlining was banned more than 50 years ago, Redfin says that Black families continue to feel the impact. Redlining came into being in the 1930s. The Home Owners' Loan Corporation rated neighborhoods on their overall likelihood of default or "mortgage security." www.NewsForInvestors.com

The Federal Reserve offered a mid-year update on the economy, after skipping the last update in March due to the pandemic. After a two-day meeting, Fed Chief Jerome Powell delivered his comments in a virtual meeting with reporters. He highlighted the fact that we are in the midst of a difficult and challenging time with great uncertainty about the future. But that said, he offered a potential timeline for a recovery that could make us economically whole over the next couple of years. www.NewsForInvestors.com

In this Real Estate News Brief for the week ending June 6th, 2020... a pleasant surprise about job growth, a forbearance slowdown, and home design that discourages germs. We begin with economic news from this past week and a surprise report on the job market that sent the stock market soaring. The government's job growth report shows a 2.5 million hiring increase for the month of May. That brought the unemployment rate down to 13.3% from a high of almost 15%, because of the pandemic. www.NewsForInvestors.com

The government is doing everything it can to prop up the housing market. But when those props disappear, will we see foreclosures? Investors capitalized on the foreclosure crisis during the Great Recession. Many single-family homes were snapped up at fire-sale prices, and turned into rentals. But, investors hoping for a similar situation may be waiting for quite some time. According to some experts, we will probably see a surge in defaults and foreclosures, but not at such a grand scale and not for several months or even a couple of years. www.NewsForInvestors.com

Some of the nation's biggest landlords are betting on a surge in demand for single-family rentals in the suburbs. JPMorgan Asset Management and American Homes 4 Rent announced a joint venture to build 2,500 new single-family rentals in western and southwestern high-growth markets. They say the deal will capitalize on a post-pandemic desire to move away from apartments in crowded cities. It will also help address a lack of existing home inventory. www.NewsForInvestors.com

It was only a few months ago that cities were worried about how to keep their low-income residents. Now there's concern that the need for social distancing is chasing big companies and their highly-paid employees away. The post-pandemic office environment is going to be different, and there are signs already that businesses are rethinking their office space needs. www.NewsForInvestors.com

In this Real Estate News Brief for the week ending May 30th, 2020... mortgage rates have hit a new record low, landlords keeping tenants with shorter terms, and buyers want homes with outdoor features. We begin with economic news from this past week, and signs of life in the housing market. New home sales were up .06% from March to April, although they were down more than 6% from April of last year. But the increase beat analyst expectations, with the biggest rise in the Northeast. Home sales were up almost 8% in that region. www.NewsForInvestors.com

Choosing between an Airbnb and a hotel will now include COVID-19 risk factors for many people, and at first glance, some travelers may think hotels are better at keeping things clean. But there are several factors to consider when choosing a place to stay overnight, including cleaning and disinfecting procedures. Both lodging options have their benefits and their risks. An article in the New York Times gives hotels the edge over home-sharing services like Airbnb and VRBO. It says that, for years, Airbnb has disrupted the travel industry with more affordable, home-like accommodations, but that COVID-19 is now disrupting the disruptor, in reference to Airbnb. That includes other home-sharing options as well, like VRBO. www.NewsForInvestors.com

States across the nation are giving businesses the green light to reopen, but where are the employees? It seems that a very generous unemployment bonus, authorized by the CARES Act, may be contributing to a decision to remain unemployed. The government is handing out a $600-a-week bonus on top of regular unemployment benefits/ Now, many are getting more from unemployment than they did when they were working. The fact that people are getting this bonus has probably contributed to high rent collection numbers. People have had the money they need to keep up with their obligations. That's the whole point of the extra money, to keep people as close to financially whole as possible. www.NewsForInvestors.com