Latest News

Over recent years we have wrote several articles on the US housing market and how the market was viewed as a Sellers market. This impacted the availability of inventory and we seen price increases across several States in the US, especially on the West Coast. Now we see something is changing with the market and it looks like we could be entering into a Buyers market, we have seen serval indicators of this in the last few months. Over recent years we have seen mortgage rates hitting decade’s highs as the Federal Reserve has been hiking up its policy rates. The National Association of Realtors have said it is no surprise that the slow down of the market would be inevitable. Rick Palacios Jr., Director of Research at John Burns Real Estate Consulting quoted “If we’re right, nationally we’ve already entered the early stages of a buyer’s market. Should supply levels cross above five months we’ll be watching for flat, possibly declining resale prices in some markets, especially where affordability is already very stretched.So the beginnings of the buyer’s market arrived gingerly at around April or May this year based on national numbers. Goldman Sachs have quoted that the US bank expect prices to decelerate for the remainder of this year and then level off sometime next year, not because demand is falling but because mortgage rates are so high, demand is still very high. This situation causes a bit of dilemma for US house Buyers as they may predict that prices will fall in the coming months but then again will mortgage rates go up again ? And how sure are we that prices will fall if demand is so high and inventory is still restricted ? The higher mortgage rates have no doubt put added pressure and frustration on Buyers. On top of increased mortgage rates and uncertainty about the prices, US Buyers are also facing competition from Overseas, buyers from other countries purchased $59 billion worth of US homes in the last 12 months and 44% of them paid in cash and did not need a mortgage. But if the market is cooling down the plus side for Buyers is that overall it gives them some leverage when it comes to negotiating, multiple bids on the same property is not as common as it was 12 months ago. According to a Redfin report published this week, which showed nearly 49.9% of home offers written by Redfin agents faced competition on a seasonally adjusted basis in June. That’s the first time the bidding war rate has been below 50% in almost two years. The only time we really see prices going above the list price is when there are bidding war. Daryl Fairweather, Redfin’s chief economist stated “And we’re back to a place where bidding wars are unusual, not the norm.” But this does not mean we are going to see a crash, Fitch Ratings Rating Agency have stated “some regional home price corrections” in overheated areas. “Despite the prospects of a home price correction, Fitch deems a housing market crash akin to the Great Financial Crisis highly unlikely,” the company said. “The main reasons are because housing inventory is still constrained, and existing homeowners who have benefited from low mortgage rates are unlikely to sell their properties.” Matthew Pointon, senior property economist at Capital Economics, stated in June that he now projects home prices to fall about 5 percent by mid-2023. So if there is a 5% fall in prices does this mean its a Buyers market, not necessarily but it does mean Buyers are in a stronger position now than they were 12 months ago, there is the possibility of some price negotiating but buyers will need to act when sellers agree to these price reductions as no one knows when this situation can change again. The other factor is the rental market, if sales slow down that means the rental pool starts to dry up, therefore we could see increased rents in several cities. The prospect of increased rents is attractive to Overseas investors and therefore they start pushing the demand again and also the overall return on investment etc. The overall consensus you could take is that house prices have pushed the boundaries of affordability but a boom should not end with a bust. This is a great time to enter US housing market with more properties available than 12 months ago and more realistic pricing. As you can seed from our pricing Global Investments Inc have already started negotiating and getting sellers down on their prices. Get in touch now if you would like us to send you our current discounted inventory… Email Invest@globalinvestmentsincorporated.com

Over the last few years we have written several articles on the US housing market and how we seen a shortage of supply leading to a frenzy of rising prices and bidding wars.But now with interest rates on the rise in the US it looks like we are starting to turn a corner, some markets in particular are  starting to slow down.Is this a good thing or a bad thing ? Well it depends if you are the Buyer or Seller ? If you are buying a property it puts you in a stronger position as Sellers need to adjust their expectations. Bill Kowalczuk from Coldwell Banker Warburg said “Sellers have to be more realistic” It is important to note that this cooling down is not across the whole of the US but seems to be in certain pockets in different States. We see the biggest cooling down taking place on the West with California leading the way but we need to bear in mind that cities like San Jose and Sacramneto probably seen the highest levels of over heating in the last few years. According to Federal Reserve data, the average US home selling price during the first quarter of 2020 was $329,000, with that number rising to nearly $429,000 two years later. Real estate agents say bidding wars have become less frequent and inventory is rising. A growing share of sellers are also being forced to trim their asking prices to find a buyer.But it is not just on the West we also see cooling down in cities like Albany in New York, El Paso in Texas, Rochester also in New York and Bridgeport in Connecticut. So we can see its the higher priced markets that are being the most impacted as 30 year mortgage rates are approaching 6%.The Federal Reserve reversed course this year after inflation spiked, making the price of food, fuel, housing and other essentials a dominant economic concern. The central bank has bumped up its benchmark interest rate three times in 2022 and signalled that four more increases are pending.So we see that market is cooling in certain areas of the the US but does this mean it is slowing down ? Well it depends how you look at things.Ralph DiBugnara president of Home Qualified, stated “The summer market will stay mostly high because of an increased urgency to buy,” he says. “This urgency is spurred by fears of further rising rates and more homes coming to market, due to more sellers wanting to cash in on the equity they’ve gained over the last few years.”Selma Hepp, deputy chief economist for CoreLogic stated “The market will continue to see relatively strong demand from buyers and an elevated rate of home price growth, despite slowing notably from ultra-hot early spring 2022 conditions” Redfin report published this week, which showed nearly 49.9% of home offers written by Redfin agents faced competition on a seasonally adjusted basis in June. as the market slows, home prices aren’t growing at the same rate as they have been but they are not falling either.When a hot housing market cools down a bit, it doesn’t mean home prices are falling (or even going down). It just means they’re growing at a slower rate. In other words, a cooler housing market is actually good news for both buyers and sellers.But no one can say for sure how the housing market will trend in the second half of 2022. How high will mortgage rates go? how much will buyer demand slow down? how many new units will hit the market and will they be enough ? But either way we are all keen to see what changes will take place in the next six months. 

There is a lot of anticipation over what will happen with house prices for the remainder of this year, inflated prices and rising interest rates have some experts concerned that another housing crash might be on the way. Last year we seen huge increase in house prices even-though there was a global pandemic. This was all brought about by very low inventory levels and low interest rates which actually led to bidding wars in some States, according to Freddie Mac prices overall rose by 16.9% We can not predict exactly what will happen this year but so far the housing experts are saying it looks things are going to stay the same, low inventory levels, more prices rises and fast sales time, the Sellers market continues for another year.  Bob Pinnegar the CEO of the National Apartment Association has stated that affordable housing is still going to remain a key issue this year. Supply chain delays and continued inflation will also impact every facet of the industry, from property managers to renters to owners. But there is one factor we need to take into consideration before concluding 2012 is another bull market and that is mortgage rates. The Federal Reserve is shifting policy to help slow down inflation which will result in higher mortgage rates. We already seen that the average 30 year fixed mortgage rate jumped to 3.56% in January, one of the biggest jumps in nine years. So the big question is will a rise in mortgage rates bring down pricing in this coming year or is they’re still such a shortage of housing that this will not make any difference ? Daryl Fairweather, Redfin chief economist, says, “I expect mortgage rates to slowly rise to 3.6% by the end of 2022.” This, he says, is because the Fed is tapering mortgage backed security purchases and we’ll feel the effects in mortgage rates. Dr. Lawrence Yun, the chief economist at the National Association of Realtors (NAR), forecasts the 30-year fixed mortgage rate to increase to 3.5% by the end of 2022. But even with these increased mortgage rates we need to bear in mind that housing supply is now at its lowest level since the 1970s, due to millennial homeownership and other factors such as rising building prices. And even though the mortgage rates are rising they are sill historically low. Already this year home sales in the U.S. rose in the first month of 2022, while the number of homes for sales was at a record low. House sales jumped 6.7 percent  in January 2022 from a month earlier, the highest rate in 12 months, according to the National Association of Realtors (NAR). Zilllow the online marketing company say the housing market may not reach the incredible heights of 2021, but they expect it will be anything but slow. Zillow’s forecast calls for 11 percent home value growth in 2022, down from a projected 19.5 percent in 2021. It expects sales of existing homes to total 6.35 million, up from an estimated 6.12 million in 2021. The Zillow economists say the market forces that have given sellers the upper hand over the past two years or so (tight supply after years of underbuilding, remote work, U.S. demographics and low mortgage rates) will all persist again this year. They expect bidding wars on many homes, especially as the market heats up during spring and summer. Sue Yannaccone, chief executive officer and president of Realogy Franchise Grouphas said  Real estate is entering a new era. The pandemic-fueled frenzy we saw over the last 24 months is giving way to a new kind of real estate market – one that will be driven by solid and sustainable demand which have not seen for a long time. The changes to Americans’ working and living behavior are also compounded by demographic shifts giving way to a new generation of homebuyers. Making up the largest share of new home buyers in the U.S. and entering their 30s and 40s at a growing rate, Millennials are finally getting off the sidelines of the housing market. So overall it looks like 2022 will not be as crazy as 2021 but there is still no reason for prices to fall anytime soon. In fact you are prepared to enter the housing market 2022 is a great year to do this, the market is more stabilised than 2021 but still prices are increasing. If you would like anymore information on our great US properties please email invest @globalinvestmentsincorporated.com

Developers in St.Louis have their sites firmly set on Midtown St.Louis, several residential and commercial developments have been chosen for this area. The City Foundry opened last August in Midtown and has been a roaring success. Previously a disused site the City Foundry has opened its doors as a contemporary Food Hall show casing chefs from around the city and the region a brand-new stage for their newest and biggest ideas, the City Foundry has now become the biggest attraction in Midtown. Beyond the food hall the development site will expand with hundreds of residential homes and retail spaces. Midtown has its own Corporation called The St. Louis Midtown Redevelopment Corporation and it is led by a dedicated Board of Directors and Staff to oversee the development of the Midtown area. Their aim is to help promote and guide the further redevelopment of Midtown, Saint Louis University and SSM Health worked with the City of St. Louis to develop the St. Louis Midtown 353 Redevelopment Plan which was adopted by Ordinance 70428 and became effective on March 21, 2017. The Redevelopment Plan covers an approximately 400 acre area (the “Redevelopment Area”) generally bounded by 39th Street, Spring Avenue and Vandeventer Avenue on the west; Compton Avenue on the east; Laclede Avenue and Interstate 64 on the north; and Park Avenue and Interstate 44 on the south. There are many development plans in place and these are just some of the ones we can expect over the coming years. The Armory District Project – The historic Armory Building was used by the Missouri National Guard as a location for their training camp. Today, Green Street Properties is taking this building and adjacent land and turning it into a hub of innovation. Office spaces, approximately 1,000 parking spaces, and a potential hotel. Element by Westin Hotel – Midas Hospitality has acquired the headquarters of Habitat for Humanity Saint Louis to make way for a new seven-story hotel with features including 153 extended-stay rooms, 10,000 sq. ft. of retail space, a rooftop lounge and fitness center. The Chouteau Greenway Trail Project – In 1999, McCormack Baron Salzar began plans for Chouteau Lake on the southern edge of downtown St. Louis. This conceptual development paved the way for Great Rivers Greenway’s Master Plan to connect the areas within St. Louis City via lakes, wetlands, and trails for citizens and visitors. The next step in this plan is to create a pedestrian-friendly trail going from Forest Park to Downtown St. Louis via the Midtown neighborhood. Iron Hill Project – Iron Hill will be a vibrant mixed-use destination combining shopping, living, modern workplaces, hotels, entertainment, and diverse dining options. The 850,000 sq ft project will be one of the densest developments to date in the City of St. Louis. The Steel Square Project – In June, 2018, Pier Property Group began converting the Steelcote building into 33 luxury apartments complete with 25 outdoor and 15 indoor parking spaces. This historic 40,000 square foot building, once home to the Steelcote paint company, is being rehabilitated to combine historic charm with luxury living. They estimate that within the next few years, Midtown St. Louis may well be the busiest 400 acres in St. Louis in terms of new development. The St. Louis Midtown Redevelopment Corporation has huge plans for the neighborhood. Saint Louis University has the same shared vision for Midtown by acquiring a 400 acre site in midtown St. Louis as it seeks greater influence over development in the future. The boundaries of the redevelopment area stretch from 39th Street, Spring Avenue and Vandeventer Avenue on the west; to Compton Avenue on the east; and from Laclede Avenue and Interstate 64 on the north; to Park Avenue and Interstate 44 on the south. The area encompasses the future home of a new $550 million hospital and outpatient center that SSM Health is planning to build along south Grand Boulevard, adjacent to the current SSM Health Saint Louis University Hospital. SLU’s plan lays out proposed uses within the redevelopment area which include the following – Medical and educational uses including offices and training facilities for those in the health care and life sciences; classrooms and related instructional, laboratory, research, hospice, nursery and day care spaces; and pharmacy facilities. Office facilities for private, public and non-profit institutions, businesses and agencies; research facilities; retail, dining, entertainment and other services; hotel and conference facilities; recreational and community facilities; and parking. New residential housing near SLU’s south campus, where it’s estimated that 60 to 80 single-family or low-density dwelling units could be constructed on vacant lots in the area. A future connection with the proposed Chouteau Greenway, which would flow through the redevelopment area. Midtown St.Louis is undergoing massive changes and once finished it will be seen as one of the best parts of the cities, properties in around Midtown are likely to soar in value as we have seen in other US cities when the Midtown areas have been developed. If you would like information on any of our great St.Louis properties please contact us at: invest@globalinvestmentsincorporation.com