The Unassuming Economist

Conference

• CALL FOR PAPERS — 2024 Conference on Low-Income Housing Supply and Housing Affordability – AREUEA

On the US—developments on house prices, rent, permits and mortgage:    

• Inflation Adjusted House Prices 4.4% Below Peak. Price-to-rent index is 7.9% below recent peak – Calculated Risk
• Understanding Rationality and Disagreement in House Price Expectations – NBER
• Rate-Locked Homeowners Nearly Twice as Likely to Not Consider Selling. A recent Zillow survey found that homeowners who report buying their home at lower mortgage rates are less likely to sell their home and move. – Zillow
• Freddie Mac House Price Index Increased in June to New High; Up 1.7% Year-over-year. Boise leads Cities with 11.7% decline from Peak, Seasonally Adjusted – Calculated Risk
• Asking Rents Negative Year-over-year – Calculated Risk
• How Much will the Fannie & Freddie Conforming Loan Limit Change for 2024? – Calculated Risk
• Unaffordable Prices & Bidding Wars Hold Buyers Back – NAHB

On the US—other developments:    

• How to nudge Americans to reduce their housing exposure to climate risks – Brookings
• Home Insurers Are Charging More and Insuring Less. Industry tries to rebound from years of losses owing to storms, fires and inflation – Wall Street Journal
• Lots of US Homeowners Want to Move. They Just Have Nowhere to Go. Locked into cheaper borrowing costs and unable to find a new place that fits their budgets, countless people are opting to remain in their current homes, adding to an acute shortage of available properties. – Bloomberg
• US Homeowner Equity Climbs to a Record High – Bloomberg 
• Biden-⁠Harris Administration Announces Actions to Lower Housing Costs and Boost Supply – White House
• Housing Affordability Expectations Slide Back, Again – NAHB 
• Some Buyers Remain Engaged, Despite Lower Affordability – NAHB
• Majority of Americans prefer a community with big houses, even if local amenities are farther away – Pew Research Center

On China:

• Top China Housing Official Urges Fresh Property Aid Efforts. China’s housing minister met with developers amid downturn. Beijing has pressed lenders to help builders complete projects – Bloomberg
• China has to stabilize its housing market and address risks to its economy if it wants to avoid ‘Japanification’, JPMorgan says – Business Insider
• China’s Housing Ministry Urges More Property Rescue Efforts – Wall Street Journal
• Beijing, Shenzhen and Guangzhou officials vow support for China’s struggling property market, stocks surge. Authorities in Beijing and Shenzhen to ‘satisfy the rigid demand and improvement demand for housing’ and help ‘stabilised and healthy development’ of housing market. Local newspaper reports say Guangzhou Municipal Commission of Housing will soon roll out loosening measures – South China Morning Post
• China’s property problems appear poised to improve, but can ‘much more risky’ real estate still drive economic growth? Beijing vows restrictive property policies will be further relaxed, but investors do not seem to have the same speculative mentality they used to. Some analysts say the property sector cannot be the ‘old growth driver’ it once was, while others say it will nonetheless remain a critical pillar of the economy – South China Morning Post

On other countries:  

• [Australia] Australian house prices look set to rise despite the rate hikes. This isn’t great given how expensive they already are. Existing mortgage holders are likely to be spared more interest rate rises after the latest RBA meeting, but first home buyers will find the task ever more difficult – The Guardian
• [Canada] Soaring Housing Costs Threaten Political Consequences for Trudeau. Canada’s benchmark house price has doubled since 2013. Immigrants arriving outpace housing units started by 4.5 times – Bloomberg
• [Hong Kong] Hong Kong property prices have room to fall before mortgage peak heralds return of buy-to-let investors. Commercial banks raised mortgage rates for the second time this year as the city’s cost of money rose to the highest level since December 2007. More than half of property sales are to investors who use debt to part finance their purchases and costly debt keeps them away – South China Morning Post
• [Singapore] How to Singapore Home Prices Fell for the First Time in Three Years. Final government figures confirm first drop since early 2020. Tax hikes, high interest rates contributed to slowdown – Bloomberg
• [Sweden] How the ghost of the 1990s property crash returned to haunt Sweden – Reuters
• [Sweden] Sweden House Prices Eke Out Gain, Defying Higher Borrowing Costs – Bloomberg
• [United Kingdom] How UK house prices left the middle class behind. New data confirms that unaffordability is entrenched, with almost all housing now the preserve of the rich – The Guardian
• [United Kingdom] Falling mortgage rates usher borrowers towards shorter-term deals. Many lenders are trimming rates — though not all – FT
• [United Kingdom] UK mortgage approvals rise unexpectedly. Increase comes despite BoE raising interest rates sharply to 5% – FT  
• [United Kingdom] UK house prices fall at fastest rate since 2009 after interest rate rises. Nationwide says cost of a typical home is £260,828 after 3.8% year-on-year drop in July – The Guardian

On cross-country:

• 3rd Workshop on Rent Control on June 22 and 23, 2023 – DIW Berlin
• Africa’s housing crisis: developers seek to scale solutions. Africa’s enormous housing shortage has few easy answers. Can innovative construction methods help, or does everything come back to finance? – African Business

On the US—developments on house prices, rent, permits and mortgage:    

• Home Prices in US Rise for Fourth Month With Inventory Tight. Data bolsters case that January was final month of declines. ‘Strength’ of May data bodes well for future, Lazzara says – Bloomberg
• Economic, Housing and Mortgage Market Outlook – July 2023 – Freddie Mac
• How The Housing Bears Got the Last Year All Wrong. The huge mortgage shock didn’t hurt prices and there still aren’t any homes for sale. – Bloomberg
• US consumer confidence races to two-year high; house prices rising – Reuters
• Interest for New Homes Strengthens – NAHB

On the US—other developments:    

• Housing-Market Rebound Poses Challenge for Fed’s Inflation Fight. Demand for homes continues to outpace supply, lifting prices. More stubborn inflation could require higher rates for longer – Bloomberg
• Robert Shiller—who called the 2008 housing bubble—thinks he knows how the housing market will exit its latest period of exuberance – Fortune
• Why We May Be About to See the Shortest Housing Cycle Ever. How long can house prices withstand the gravity of higher rates? – Bloomberg 
• Housing Demand Slows on Higher Rates and Prices – NAHB
• Foreclosure Rates Are Surging: These 10 U.S. Cities Are Where They’re Up the Most – Realtor
• Housing-Market Rebound Poses Challenge for Fed’s Inflation Fight. Demand for homes continues to outpace supply, lifting prices. More stubborn inflation could require higher rates for longer – Bloomberg
• Fannie and Freddie: Single-Family Mortgage Delinquency Rate Declined, Multi-Family Increased in June. CoreLogic: Mortgage Delinquency Rate Drops to All-Time Low in May – Calculated Risk

On China:

• China Holds Off on Major Stimulus as It Signals Property Easing. Politburo promises ‘counter-cyclical’ policy in July meeting. Readout doesn’t include big fiscal, monetary policy loosening – Bloomberg
• China property giants tumble as cash crunch bites – Reuters
• Is China property for speculating? Xi’s Politburo lets real estate off leash after 6 long years. Real estate policies across China will be adjusted faster to help nation cope with ‘setbacks’ from the ebb and flow of economic development in a post-Covid climate. For years, President Xi Jinping said houses were for living in, not speculating – but the Politburo made no mention of that on Monday – South China Morning Post
• China Property Woes Causing ‘Downward Spiral,’ BofA Says – Bloomberg

On other countries:  

• [Canada] How to Fight Inflation When Consumers Think Home Prices Can Only Go Up. The Bank of Canada is running up against optimistic homebuyers in its efforts to tame inflation, offering a glimpse of what might be in store for central banks around the world. – Bloomberg
• [Canada] Why the hot Canadian housing market keeps rising. A game of chicken between central bankers and consumers is playing out in one of the hottest housing markets in the world. – Financial Review
• [United Kingdom] Sunak tilts housing drive to inner cities to meet 1mn new homes pledge. Gove is set to cut red tape as PM insists target will not be met ‘by concreting over the countryside’ – FT
• [United Kingdom] Be angry about the rigged housing market. The UK property market is stacked against parents trapped in rented accommodation, says Karen Murphy – The Guardian
• [United Kingdom] Bomadland: How the Bank of Mum and Dad helps kids buy homes – Bank of England
• [United Kingdom] Generation Rent is at the sharp end of rate rises. Landlords with buy-to-rent mortgages are passing on their pain – FT
• [United Kingdom] The answer to Britain’s housing crisis lies in its towns and cities – not the countryside. The Conservatives are right about making urban areas denser, but their proposed planning reform is an undemocratic mess – The Guardian
• [United Kingdom] Number in temporary housing in England hits 25-year high. Homelessness rising sharply as rental and mortgage costs soar, official figures show – FT
• [United Kingdom] Higher mortgage costs threaten surge of UK buy-to-let property sales. Landlords look to get rid of financial ‘headache’ by exiting rental market, further depressing the housing market – FT

Links to the week’s top housing market stories.

On US

• Housing’s Recession Already Happened – WSJ
• Housing market recession? Not likely. Prepare for hot post-pandemic prices – USA Today
• These Are the 10 Most Overpriced Housing Markets in the U.S. — 5 Are in Florida – Yahoo Finance

On rest of the world

• Global Migration Boom Keeps Housing Costs High – WSJ
• Popping Real Estate Bubbles Will Prove Painful – Bloomberg
• [Australia] House prices will keep rising into next year, says Domain, as immigration boosts demand – The Guardian
• [Australia] Australian house prices set to rise again, despite interest rate pain – AW
• [Australia] Sydney house prices to boom again – MACROBUSINESS
• [Canada] Luxury real estate markets in Canada saw divergent performance in the first half of 2023 – CTV News
• [Canada] Posthaste: The luxury housing market in Canada has undergone a major change – Financial Post
• [UK] UK housing market forecast to avoid slump despite zero growth in prices – The Guardian
• [UK] House prices predicted to fall 12pc with ‘little prospect’ of bounceback – Telegraph
• [UK] Banks, Housing, Markets, and UK CPI – Bloomberg
• [Euro] European home prices fall but don’t bet on a crash – DW
• [Sweden] Sweden Home Starts Indicator Hits 9-Year Low After Price Slump – Bloomberg
• [Germany] New housing construction set to strongly decline – DW
• [Danish] Danish Housing Market Better Than Feared, Mortgage Giant Says – Bloomberg

On cross-country:

• The housing supply problem. A four-part series on housing affordability in the UK and US – FT
• The Global Housing Inspection Report – 2023 Edition – Seeking Alpha
• How to reduce the damage done by gentrification. We cannot let our cities descend into islands of privilege amid seas of disadvantage. With the right policies and investments, a better future is possible – The Guardian

On the US—developments on house prices, rent, permits and mortgage:    

• The 30-Year Mortgage Is Saving the US Economy … or Is It? Long-term fixed-rate home loans help keep the housing market from collapse, but they make the overall economy less dynamic. – Bloomberg
• Higher Interest Rates Hit Home Prices Again. U.S. existing-home prices fell in May from a year earlier by the most in more than 11 years – Wall Street Journal
• Fraudulent Covid Aid Drove Up U.S. House Prices, Report Says. Researchers found that people who defrauded the government for pandemic relief poured money into housing markets, driving inflation in some areas – Wall Street Journal
• Small Mortgages Are Too Hard to Get. A shortage of loans for homes priced below $150,000 bars many American families from homeownership – Pew Charitable Trusts
• Case-Shiller: National House Price Index Decreased 0.2% year-over-year in April. “U.S. house prices rose in April, up 0.7 percent from March, according to the Federal Housing Finance Agency (FHFA) seasonally adjusted monthly House Price Index (HPI®).” – Calculated Risk
• Inflation Adjusted House Prices 3.8% Below Peak. Price-to-rent index is 8.4% below recent peak – Calculated Risk

On the US—other developments:    

• What Is Happening in the Housing Market? Home construction surged in May and prices have ticked up, even with interest rates at a 15-year high. The resilience has surprised some economists. – New York Times
• Only Zoning Reform Can Solve America’s Housing Crisis. By making it impossible to build enough homes in places where people want to live, local governments hurt the economy and democracy. – Wall Street Journal
• Final Look at Local Housing Markets in May – Calculated Risk
• Home Builders Learn to Love High Rates. Low supply of homes is giving builders ample reason to step up construction, despite high interest rates – Wall Street Journal
• Buying a home in the US is expensive – and that isn’t changing anytime soon. Even if there are fewer home buyers and prices have been falling slightly, they’re still much higher than pre-pandemic and for many, more unaffordable than ever – The Guardian
• US existing home sales edge up but prices drop by most since 2011 – Reuters
• Fannie and Freddie Serious Delinquencies in May: Single Family Declined, Multi-Family Increased – Calculated Risk
• New Home Sales increase to 763,000 Annual Rate in May. Median New Home Price is Down 16.2% from the Peak – Calculated Risk

On China:

• How to escape China’s property crisis. Lessons from a city that is flourishing – The Economist

On other countries:  

• [Germany] German house prices fall by record 6.8% as higher mortgage costs deter buyers. First-quarter drop in Europe’s largest property market is biggest since index began in 2000 – FT
• [Hong Kong] Hong Kong may relax mortgage loan-to-value ratios amid sluggish property market: Financial Secretary Paul Chan. The government, along with the Hong Kong Monetary Authority, will balance financial stability and the interests of first-time buyers, Paul Chan says. Chan’s comments come as Hong Kong’s residential market is showing fresh signs of weakness after a short-lived rebound in the first quarter – South China Morning Post
• [Ireland] Irish Home Prices Post First Year-on-Year Decline Since 2020. Average prices slip 0.5% in the second quarter from a year ago. Once-hot market still on edge after quarterly gain of 2.4% – Bloomberg   
• [Ireland] Strong Irish mortgage market unmoved by higher interest rates – Reuters
• [Turkey] Turkish property prices are soaring. A crazy interest-rate policy is mostly to blame – The Economist
• [United Kingdom] The Bank of England Owes Mortgage Payers a Big Apology. UK living standards are being hit by 8.7% CPI and 6% mortgage rates. – Bloomberg
• [United Kingdom] The Guardian view on mortgages: the crunch is coming. Westminster is forever blowing property bubbles. What happens when they burst? – The Guardian
• [United Kingdom] Making downsizing easier could help Britain’s housing crisis. Shuffling the pack by liberating under-occupied homes will have a bigger impact than building new ones – FT
• [United Kingdom] The UK mortgage market may need an overhaul, not handouts. There need to be longer-term questions about the peculiarities of housing borrowing in Britain – FT
• [United Kingdom] Young adults pay heaviest price for Britain’s exploding mortgage timebomb. Rising interest rates expose widening generational gulf, with millennials facing large increases in monthly payments – FT 
• [United Kingdom] Have We Reached the Tipping Point for UK House Prices? As mortgage rates rise, the most vulnerable areas are also the most expensive. – Bloomberg
• [United Kingdom] Why higher rates risk reigniting intergenerational conflict. A cohort of people in their mid-30s have probably been pummelled twice by monetary policy over the past decade – FT
• [United Kingdom] Cut Stamp Duty to fight inflation and expand housing supply. – IEA

On cross-country:

• Better Housing Policies in the Post-COVID-19 Era – OECD
• Madrid’s Rising Property Prices Threaten a Housing-Market Crunch. Spanish capital bucks trend of sliding prices in other cities. Impact of tight supply is also evident in London, Stockholm – Bloomberg

On the US—developments on house prices, rent, permits and mortgage:    

• US Single-Family Rent Growth Continues Yearlong Descent in April, CoreLogic Reports – CoreLogic
• US Housing Starts Surge Most Since 2016, Exceed All Estimates. Beginning construction jumped 21.7% to 1.63 million pace. May starts of single-family dwellings highest in 11 months – Bloomberg

On the US—other developments:    

• Today’s Rate Hikes Threaten to Push Up Tomorrow’s Housing Costs. Fewer builders are starting new homes amid high prices for materials and loans, threatening housing shortages – Wall Street Journal
• The State of the Nation’s Housing 2023 – Joint Center for Housing Studies
• US homebuilders: new construction a rare bright spot in real estate gloom. While sales of previously owned homes are down, prices have held steady – FT
• 3rd Look at Local Housing Markets in May – Calculated Risk
• Lawler: Early Read on Existing Home Sales in May – Calculated Risk
• Economic, Housing and Mortgage Market Outlook – June 2023 – Freddie Mac
• Some More Good News for Homebuilders – Calculated Risk
• America’s housing shortage is keeping home prices high – Axios
• America’s housing tailwind – Axios

On China:

• China Home-Price Growth Weakens as Housing Recovery Falters. New home prices rose 0.1% in May, slowest pace in four months. Slowdown comes as policymakers consider stimulus package – Bloomberg

On other countries:  

• [Australia] Australian PM pledges $1.4 billion for affordable homes – Reuters
• [Canada] Canada’s housing data shows recovery accelerating before rate hike – Reuters
• [New Zealand] Where Housing Prices Have Crashed and Billions in Wealth Have Vanished. In New Zealand, high interest rates have sent property prices sliding nearly 18 percent since November 2021. – New York Times
• [Sweden] Europe’s Worst Housing Market Shows Signs of Life – Bloomberg
• [Switzerland] Swiss Flats Up to 40% Pricier Than What Fundamentals Signal – Bloomberg
• [Turkey] Turkish property prices are soaring. A crazy interest-rate policy is mostly to blame – The Economist
• [United Kingdom] What steps could government take to help mortgage borrowers? As interest rates rise, cash-strapped households need speedy solutions to meet monthly payments – The Guardian
• [United Kingdom] Average mortgage rate for two-year fixed deal edges closer to 6%. Nationwide is latest lender to lift cost of deals as borrowers brace for 13th successive Bank of England interest rate rise – The Guardian
• [United Kingdom] Two of UK’s biggest lenders to raise mortgage rates. Pressure mounts on government struggling to contain cost of living crisis as NatWest and Nationwide push up cost of borrowing – FT
• [United Kingdom] The great British mortgage squeeze. Regaining control over inflation is the best way to support homeowners – FT
• [United Kingdom] First-time buyers struggle as mortgage products cut by 40%. Rising interest rates prompt lenders to clamp down on borrowers with small deposits – FT
• [United Kingdom] Mass UK house repossessions unlikely despite soaring mortgage rates. Regulatory reforms, increased levels of equity and fixed deals should protect many homeowners – FT