News Alerts. Sept. 24, 2013. Afternoon Edition. #RealEstate

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  1. Misreading housing bubble dynamics | MacroBusiness

    Good researching:

    …a recent Journal of Urban Economics paper by Haifang Huanga and Yao Tang suggests the link between higher house price volatility and non-responsive housing supply (e.g. due to restrictive land use regulations) has become more pronounced in the US [my emphasis]:

    Abstract: "In a sample covering more than 300 cities in the US from January 2000 to July 2009, we find that more restrictive residential land use regulations and geographic land constraints are linked to larger booms and busts in housing prices. The natural and man-made constraints also amplify price responses to the subprime mortgage credit expansion during the decade, leading to greater price increases in the boom and subsequently bigger losses.

    And in a detailed examination of studies in this area, Harvard's Edward Glaeser and Warton's Joseph Gyourko also concluded that tight land/housing supply leads to greater price booms and busts:

    Recent research also indicates that house prices are more volatile, not just higher, in tightly regulated markets …. price bubbles are more likely to form in tightly regulated places, because the inelastic supply conditions that are created in part from strict local land-use regulation are an important factor in supporting ever larger price increases whenever demand is increasing.

    …. It is more difficult for house prices to become too disconnected from their fundamental production costs in lightly regulated markets because significant new supply quickly dampens prices, thereby busting any illusions market participants might have about the potential for ever larger price increases.

    Should economic conditions deteriorate significantly, such as via a disorderly unwinding of the mining boom, the number of Australians opt ing for group accommodation (or the number of young people moving back into mum and dad's) could rise significantly, turning a perceived housing shortage into a surplus.

    Read the source article … misreading-housing-bubble-dynamics/

  2. Hidden single-family rental markets still profitable for investors | 2013-09-18 | HousingWire

    Blomquist [Daren Blomquist, vice president at RealtyTrac] noted that this analysis has identified the top overlooked markets where single-family rentals still make good financial sense but where there is little to no competition from the big players.

    However the "big players" read HousingWire too. We should think though that it would be a question of whether the big players might be concerned with spreading themselves too thin regarding management along with service and other suppliers (contractors, etc.).

    Read the source article … 1-hidden-single-family-rental-markets-st ill-profitable-for-investors

  3. Singapore tipped to become Asia's Integrated Reporting hub – The Accountant

    This is another reason Singapore's real-estate market might fare well.

    The Singapore Accountancy Commission (SAC) is determined to transform the country into the hub of Integrated Reporting (IR) in South East Asia, The Accountant has learnt.

    Integrated reporting

    Read the source article …  /singapore-tipped-to-become-asias-integ rated-reporting-hub/

  4. Consumers prioritize mortgages over other types of debt | 2013-09-19 | HousingWire

    Consumers in financial distress are increasingly placing more value on paying their mortgages first, a reversal of a trend that developed during the housing meltdown.

    With improvements in home prices, the 30-day mortgage delinquency rates are well below credit card delinquencies and could remain that way for the foreseeable future. This is a transition back to a traditional payment hierarchy, where mortgage loans dominant in the minds of borrowers, credit bureau TransUnion said.

    Read the source article … 7-consumers-prioritize-mortgages-over-ot her-types-of-debt

  5. Investors focus on ramping up occupancy rates | 2013-09-18 | HousingWire

    "The opportunities aren't there in terms of the REO channel," he added. The analyst noted that he doesn't expect to see institutional investors taking down big blocks of properties the way they have been the past 12-18 months. "The savvy investors are really focused on non-performing loans," he said.

    Read the source article … 3-investors-focus-on-ramping-up-occupanc y-rates

  6. Phat Dragon: Chinese housing on the boil | MacroBusiness

    … after a modest deceleration in price growth in Q2, the vast majority of cities have residential property markets ostensibly back on the boil. How can this be? Phat Dragon cites the following factors. (1) Completions are no longer keeping pace with demand, as developers have smoothed their construction activity and spent most of 2012 [2012?] with the intent to clear inventory and shore up balance sheets. (2) Bank lending to households has been consistently firm in the year to date, even as credit supply to firms has been extremely variable. (3) With aggregate demand sputtering in Q2, the desire to disseminate tier 1 controls more broadly was not as strong. (4) The equity market has performed poorly throughout. (5) Urban infrastructure is altering the utility of previously marginal real estate on the city fringe and the smart money is taking note.

    Read the source article … phat-dragon-chinese-housing-on-the-boil/

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