End of the NJ HQ?

Posted on January 14, 2020 by grim

From the Star Ledger:

N.J. could force employers to pay severance to laid-off workers

Stirred by the plight of New Jersey Toys “R” Us workers who lost their jobs when the Wayne-based retailed filed for bankruptcy and shuttered stores across the country, the state Legislature on Monday passed a bill requiring larger employers in New Jersey pay severance to laid-off workers.

The bill (S3170) would require New Jersey employers with at least 100 employees provide their workers 90 days notice — up from 60 — before a large layoff or a plant closing or transfer that will put at least 50 people out of work. It would also force these businesses to pay their workers one week’s severance for every year of service. The payout increases by an additional four weeks if the employer doesn’t comply with the 90-day notification rules.

More than 30,000 workers nationwide lost their jobs, including some 2,000 in New Jersey, when the famous retail giant closed its doors. Employees were initially let go without severance. Two of the private equity funds that owned Toys R’Us, facing public pressure, have since established a $20 million severance fund and workers won a $2 million settlement.

United For Respect, a nonprofit group advocating for the bill, said that if signed by Gov. Phil Murphy, New Jersey would become the first state with such a severance mandate.

Meanwhile, the New Jersey Business and Industry Association, which represents 20,000 businesses here, has warned the bill will deter companies from locating or expanding in New Jersey.

Posted in Economics, Employment, New Jersey Real Estate|79 Comments

Still strong on LI

Posted on January 12, 2020 by grim

From LI Business News:

Long Island home prices climb on strong sales

Prices of Long Island homes sold last month rose compared with a year ago, boosted by strong demand and a shrinking supply.

The median price of homes contracted for sale in Nassau County last month was $536,000, up 2.5 percent from the $523,000 median price recorded in Dec. 2018, according to numbers from the Multiple Listing Service of Long Island.

In Suffolk County, the median price of pending home sales last month was $393,500, an increase of 6.4 percent from the $370,000 median price of a year ago.

Pending home sales on Long Island were up by 15.2 percent last month, rising from 1,875 in Dec. 2018 to 2,161 in Dec. 2019.

Inventory has declined year over year. There were 9,370 Long Island homes — 4,519 in Nassau and 5,211 — listed with MLSLI at the end of last month, down nearly 5.9 percent from the 9,954 homes — 4,348 in Nassau and 5,606 in Suffolk — that were listed at the end of Dec. 2018.

Posted in Economics, Housing Recovery, NYC|36 Comments

Business growing in NJ?

Posted on January 9, 2020 by grim

From GlobeSt:

Northern NJ Office Market Showing Improvement Heading into 2020

The Northern New Jersey office market showed signs of stability and improvement at the end of 2019 positing positive net absorption, lower availability and higher asking rents, according to a report released by Newmark Knight Frank.

The brokerage firm reports that the fundamentals of the Northern New Jersey are poised to continue to improve steadily entering 2020.

The office market in Northern New Jersey ended the year with stable conditions as availability declined slightly from 21.9% to 21.8% during the fourth quarter. Over the past 12 months, more than 600,000 square feet in net absorption was recorded while availability fell by 60 basis points.

The average asking rent in the Northern New Jersey office market continued to rise, increasing by 1.4% over the past year, though some submarkets are seeing stronger growth, Newmark Knight Frank states in its report. Total inventory shrank by 1.0 million square feet in 2019 in Northern New Jersey as obsolete buildings are getting torn down.

…

The report notes that several submarkets are seeing rents rising faster than the inflationary growth rate typical for most of the market. With the lowest availability rate in Northern New Jersey at 16.7%, Bergen Central saw asking rents for Class A space rise by 6.4% over the past year. In addition to low availability, building upgrades and new amenities, such as those recently completed at Glenpointe in Teaneck, are allowing landlords to start commanding higher rents, Newmark Knight Frank states.

Another area seeing strong rent growth is Newark, where Class A asking rents rose by 4.3% over the past year. Contributing to the rent growth, Downtown Newark is undergoing a revitalization exemplified by the recent completion of Ironside Newark. The development, which is an adaptive reuse of a former warehouse, added 270,000 square feet of new office space to the market in 2019. Meanwhile, the neighboring Gateway Center buildings are undergoing major renovations. These recent developments are helping to improve Newark’s image which is starting to give landlords more pricing power, the report states.

Posted in Economics, New Development, New Jersey Real Estate|113 Comments

Trends 2020

Posted on January 6, 2020 by grim

From Forbes:

The Real Estate Landscape In 2020: An Expert’s Predictions?

 Sellers will expand on home improvements before selling

These will go far beyond staging as buyers become less inclined to buy homes that need work

“They wish to know all costs upfront and mortgage everything at low rates,” Steinberg says. “The work you do after closing is not mortgageable — who has any cash left after closing for home improvements, when pricing is at a premium?”
…

 Smaller, more affordable homes will have extreme competition from first-time buyers, investors and downsizing baby boomers.

“Today, everyone is competing for entry level homes,” Steinberg says. “They have been underbuilt as the industry has focused on the high end, where there is more profit. We need much more affordable housing.”

Millennials and first-time homebuyers are not the only ones looking for small, affordable homes. Downsizing baby boomers are in competition for them, as well, and they often have 100% equity in their homes, so they have a great deal more financial clout than their millennial competitors.

         The first half of 2020 will be busy. The second half will be distracted by the presidential election.

In the spring, we will be optimistic and eager to start new things. But once the presidential election becomes the national obsession, we will not think of much else.

         As climate change continues, recovery technology will be increasingly important.

Recovering from storms, floods, fires and other climate change-driven disasters will require technology to speed things up and minimize damage and disruption.         For example, after Hurricane Sandy, many buildings were retrofitted to locate their systems above ground. Increasingly, homeowners will find that investing in recovery technologies is less expensive that insuring increasingly vulnerable buildings.

          Consumers will become more exposed to the harsh realities of ‘do-it-yourself’ and discount brokerage.

They will also become more aware of misleading claims and the self-serving intentions of those wishing to eliminate real estate agents.

“Sure, you might save a few bucks,” Steinberg says. “But as consumers dig a little deeper, they learn that there are hidden fees and that they have no guidance when they are making big decisions.”

Posted in Economics, National Real Estate|125 Comments

The Exodus

Posted on January 3, 2020 by grim

From CNBC:

People couldn’t wait to leave this state in 2019

Blame it on brutal winters, high taxes or the New Jersey Turnpike: The Garden State is the last place where people want to be.

More than two-thirds of all New Jersey moves were outbound in 2019, according to an analysis from United Van Lines.

About a third of people leaving the state cited retirement as a primary reason for relocating, the moving service found.

United Van Lines analyzed 182,186 shipments last year through Dec. 18. New Jersey had a total of 4,059 shipments, of which 2,779 were sent out of state.

This is the second year in a row that the Garden State led the country in the percentage of departures.

“The economics in that state are a little bit uncertain, so we see people leaving,” said Eily Cummings, director of corporate communications at United Van Lines.

Illinois and New York round out the top three states experiencing the highest percentage of outbound traffic, United Van Lines found.

Leaving New Jersey can make good financial sense for some people, particularly if they’re thinking of retirement.

More than 230,000 residents left the state in 2018, according to Census data.

Consider that the Garden State has an effective property tax rate of 2.13%, and state and local property tax collections per capita are $3,127, according to the Tax Foundation.

That’s the top property tax rate and the per-capita property tax collection in the nation.

Taxes on individual income are also among the highest in the country: New Jersey has a top rate of 10.75%, according to the Tax Foundation.

Posted in Demographics, Economics, National Real Estate, New Jersey Real Estate, Property Taxes|114 Comments

November Pending Sales

Posted on December 31, 2019 by grim

From CNBC:

US pending home sales rise in November

Contracts to buy previously owned U.S. homes rose in November, driven by a surge in new contracts being signed in the country’s West, the National Association of Realtors said on Monday.

The NAR’s pending home sales index, based on contracts signed last month, increased 1.2% to a reading of 108.5. The previous month’s reading was revised upward.

Pending home contracts are seen as a forward-looking indicator of the health of the housing market because they become sales one to two months later.

Compared with one year ago, pending sales were up 7.4%.

Compared to the prior month, contracts increased 5.5% in November in the West. They also increased in the Midwest but were lower in the South and Northeast.

Posted in Economics, Housing Recovery, National Real Estate|128 Comments

Housing Slowing?

Posted on December 30, 2019 by grim

From HousingWire:

Home price growth slows but rent keeps rising at 2019 ends

Both home prices and rents continued to increase as the year reached an end, but one of those two is increasing faster than the other.

Home values in the U.S. grew to $243,225 in November, which was the smallest annual growth since January 2013, according to Zillow.

Annual home value growth has now slowed in each of the past 19 months, Zillow noted, but slowdown has been gradual. 

According to Zillow, the drop in year-over-year growth has not exceeded 0.3 percentage points from one month to the next during this period.

“As we approach the winter holidays, housing, too, is taking a breather,” said Skylar Olsen, Zillow’s director of economic research. “Motivated sellers trying to close before the end of the year dropped their list prices in September and October, with November numbers showing the expected quiet in listing activity.”

Out of the 35 largest metro areas, San Antonio and Washington, D.C. are the only to be growing at a faster annual rate than they were this time last year. 

Meanwhile, San Francisco, San Jose, Las Vegas and Seattle have slowed down the most, with San Jose and San Francisco seeing a decline in year over year home values.

On the other hand, rent growth accelerated for the fifth straight month, up 2.3% annually to $1,600.

But, for-sale inventory fell 6.4% from last year, and there are 102,463 fewer homes on the market than a year ago.

Inventory fell the most in Seattle, which is down 28.8%.

“That quiet is echoed by the slower annual appreciation and the lower-than-normal available inventory. But as we anticipate longer days to come, so too we anticipate some relief for housing,” Olsen continued. “Lifting housing starts and permit numbers, strong jobs reports and the steady progress towards more stable and sustainable home value appreciation all point to a healthier 2020 for housing.”

Posted in Demographics, Economics, Employment, National Real Estate|26 Comments

NJ Minimum Wage Increasing 10%

Posted on December 27, 2019 by grim

Should be interesting given that 6 months ago, minimum wage in NJ was $8.85.On January 1st, it will move to $11 an hour – roughly a 25% increase from a year ago, which would put NJ at the top of this list.

From CBS News:

Workers in half of U.S. states will get a pay raise in 2020

A record number of states, cities and counties are boosting their minimum wage in 2020.

On or around January 1, the minimum wage will increase in 21 states, while another 26 cities and counties also boosting their baseline pay at year-start. Later in the year, an additional 4 states and 23 cities and counties will hike their minimum wages, according to the National Employment Law Project, a worker rights group.

“This is the greatest number of states and localities ever to raise their wage floors, both in January and for the year as a whole,” said Yannet Lathrop, policy analyst at NELP, in a blog post about the increases. 

…

Each of the 21 states that are boosting their minimum wages at year-start, with their new minimum wage and percentage increase.

  • Alaska – $10.19 (3%)
  • Arizona – $12 (9.1%)
  • Arkansas – $10 (8.1%)
  • California – $13 (8.3%)
  • Colorado – $12 (8.1%)
  • Florida – $8.56 (1.2%)
  • Illinois – $9.25 (12%)
  • Maine – $12 (9.1%)
  • Maryland – $11 (8.9%)
  • Massachusetts – $12.75 (6.3%)
  • Michigan – $9.65 (2.1%)
  • Minnesota – $10 (1.4%)
  • Missouri – $9.45 (9.9%)
  • Montana – $8.65 (1.8%)
  • New Jersey – $11 (10%)
  • New Mexico – $9 (20%)
  • New York – $11.80 (6.3%)
  • Ohio – $8.70 (1.8%)
  • South Dakota – $9.30 (2.2%)
  • Vermont – $10.96 (1.7%)
  • Washington – $13.50 (12.5%)

Posted in Economics, Employment, New Jersey Real Estate|51 Comments

Housing still looking good

Posted on December 26, 2019 by grim

From HousingWire:

Home sale prices increased over 5% in the last month

Home sale prices increased 5.2% year over year in November, according to a new report from Redfin.

Now, home sale prices are at a median of $311,600, the largest increase since July 2018, when home prices were up from 5.6% from 2018.

“Given that inventory is falling quickly, we’d expect to see even stronger price growth, especially when compared to last year’s soft market,” said Redfin Chief Economist Daryl Fairweather. 

“The fact that homes are selling faster indicates that there are buyers ready to pull the trigger and take advantage of low interest rates,” Fairweather added. “If lack of inventory and high demand continues, buyers who take a wait-and-see approach could face less favorable conditions in the spring season like bidding wars and faster price growth.”

Home price gains were the biggest in affordable metro areas. There were nine metro areas that saw the biggest gains below the national median for the fifth month in a row.

Homes that were sold in November also spent two fewer days on the market, compared to 2018. The typical home that sold in November went under contract in 45 days, compared to 47 days in November 2018.

The share of homes sold above list price also increased year over year, coming in at 20.7% in November compared to 19.9% a year earlier, Redfin said. 

The supply of homes for sale fell 12.1% year over year, which is the biggest decline since April 2013, and the fifth straight month of declines. There were fewer homes for sale last month than in any November since at least 2012, according to Redfin.

Posted in Economics, Housing Recovery, National Real Estate|41 Comments

SALT Cap not long for this world?

Posted on December 22, 2019 by grim

From CNBC:

House passes bill to lift $10,000 cap on state and local tax deductions

The Democratic-controlled House passed a bill on Thursday that would do away with the $10,000 limit on the itemized deduction for state and local taxes for two years.

Legislators narrowly voted in favor and did so largely along party lines: 218 to 206.

The measure, dubbed the “Restoring Tax Fairness for States and Localities Act” or HR 5377, proposes increasing the so-called SALT cap to $20,000 for married taxpayers who are filing jointly in 2019.

It also calls for the elimination of the SALT cap in 2020 and 2021.

The bill, sponsored by Rep. Thomas Suozzi, D-N.Y, along with Reps. Bill Pascrell, D-N.J., and Mike Thompson, D-Calif., marked the latest effort by blue states to fight back against certain provisions in the Tax Cuts and Jobs Act.

…

Though the bill is unlikely to get much further in the remaining weeks of the year, there’s always the possibility it may return in 2020.

“There is no chance that this bill is getting through the Senate, but I think Democrats will continue to talk about the impact of the SALT deduction,” Kaeding said.

Legislators in support of the bill plan to continue pushing.

“This is going to continue to be an issue that comes up every year until we pass and sign it into law,” said Rep. Josh Gottheimer, D-N.J. “It’s a hit to so many parts of the country, a tax hike for my district and for a lot of us in the Northeast and on the coasts.”

Posted in National Real Estate, New Jersey Real Estate, Politics, Property Taxes|46 Comments

Delinquencies at 20 year low

Posted on December 20, 2019 by grim

From CoreLogic:

The States Leading in Nationwide Delinquency Rate Drops

The overall delinquency rate was 3.8% nationwide in September, down from 4.4% a year earlier and the lowest for the month of September in more than 20 years, according to the latest CoreLogic Loan Performance Insights Report. Five states, CoreLogic notes, reported even larger decreases in their delinquency rates.

Year-over-year, the states that logged the largest decreases included: Mississippi (-1.1 percentage points), North Carolina (-1.1 percentage points), Louisiana (-1.0 percentage points), New Jersey (-1.0 percentage points) and South Carolina (-1.0 percentage points). CoreLogic notes that the decreased activity in the Carolinas may be due in part to a recovery from the elevated levels in 2018 in the wake of Hurricane Florence.

While overall delinquency fell, serious delinquency rates have begun to flatten out at low levels. The serious delinquency rate, defined as 90 days or more past due, including loans in foreclosure, was 1.3% in September 2019, down from 1.5% in September 2018. Likewise, the share of mortgages that were 30 to 59 days past due—considered early-stage delinquencies—was 1.9% in September 2019, down from 2.2% in September 2018. The share of mortgages 60 to 89 days past due was 0.6% in September 2019, down from 0.7% in September 2018.

Some of the highest delinquency rates were in metro areas including New York and Miami, though Miami still experienced annual declines. The New York metro had the highest rate at 5.1%, while Miami, with the second-highest rate at 5%, saw a sharp decrease in the overall delinquency rate, falling from 6.1% in September 2018.

Posted in Economics, Foreclosures, National Real Estate, Risky Lending|67 Comments

Idiots in Trenton

Posted on December 4, 2019 by grim

From the Star Ledger:

High-cost, high-tax New Jersey is no place for old men – or old women

You might have seen that Fairleigh Dickinson poll released last week in which a sample of New Jersey residents were asked, “Are you considering a move out of New Jersey in order to improve your standard of living?”

The pollsters reported that 44 percent of New Jerseyans said they have considered leaving the state at some point in their lives.

More important, it showed that a third of those approaching retirement age said they were considering moving out within a mere five years.

The deal called for an increase in the gas tax. That is offset by a small reduction in the sales tax as well as elimination of the estate tax.

There was also a change in the way the state taxed retirement income, a change that created that cliff.

Until that deal went through, the state taxed retirement income as regular income. That was an open invitation for retirees to leave the Garden State for greener pastures, such as Pennsylvania, which excludes pension income from its state income tax, or Florida, which has no state income tax at all.

But there was some good news and some bad news in that 2017 deal.

The good news is that the first $100,000 of retirement income is exempt from the tax.

The bad news is that if you earn one penny over $100,000 then your entire pension is taxed from the first dollar.

This so-called “tax cliff” has the perverse effect of discouraging people from earning the income they need to survive in a high-tax state like New Jersey.

…

It’s possible to find yourself on the hook for $3,000 or so in taxes for a mere dollar in income.

Posted in Demographics, Economics, New Jersey Real Estate, Unrest|190 Comments

Nobody wants to sell?

Posted on December 2, 2019 by grim

From the Real Deal

Home prices accelerate nationally as owners stay longer

The pace of rising home prices quickened in September and existing home sales ticked up 1.9 percent.

Average home prices in cities across the nation rose 3.2 percent compared with the same period in the previous year, the Wall Street Journal reported. The year-over-year rise in August had been 3.1 percent.

…

The gains mark a two-month departure from a long period of slowinggrowth in home prices.

The gains were more moderate — just 2.1 percent — in the large urban areas tracked by the composite S&P CoreLogic Case-Shiller U.S. National Home Price Index.

A separate report released last week by the Federal Housing Finance Agency echoed those findings, while the National Association of Realtors said existing home sales increased by 1.9 percent in October.

Homeowners are choosing to stay in their homes longer, in part because of a dearth of affordable options and tax abatements for older homeowners, according to a Redfin study, the Washington Post reported. Owners in homes where walkable amenities are available are also less likely to move, and houses with higher walkability scores sell faster, the study found.

Posted in Demographics, Economics, Employment, Housing Recovery, National Real Estate|21 Comments

No recession without housing?

Posted on November 28, 2019 by grim

Home price gains accelerate in September, S&P Case-Shiller Index says

Sales of new U.S. single-family homes unexpectedly fell in October following recent strong gains, but the overall housing market remains supported by lower mortgage rates.

After shrinking for much of this year, home price gains are now growing again.

On a national level, prices rose 3.2% annually in September, up from a 3.1% gain in August, according to the S&P CoreLogic Case-Shiller U.S. National Home Price Index. The 10-City Composite annual increase was 1.5%, unchanged from the previous month. The 20-City Composite rose 2.1% annually, up from 2.0% in August.

Of the 20 cities covered, Phoenix, Charlotte, North Carolina, and Tampa, Florida, saw the highest annual gains, with 6.0%, 4.6% and 4.5% annual gains, respectively. Ten of the 20 cities saw larger price increases in the year ended in September 2019 versus the year ended in August 2019.

Home prices are rising most in the Sun Belt, where housing is generally more affordable than in the East or West. San Francisco was the only city in the composites to show an annual decline in home prices (-0.7%).

“After a long period of decelerating price increases, it’s notable that in September both the national and 20-city composite indices rose at a higher rate than in August, while the 10-city index’s September rise matched its August performance,” Craig J. Lazzara, managing director and global head of index investment strategy at S&P Dow Jones Indices, wrote in a release. “It is, of course, too soon to say whether this month marks an end to the deceleration or is merely a pause in the longer-term trend.”

Other measures of home prices have shown multiple months of reacceleration in prices, and other factors in the housing market point to price strength going forward.

Posted in Demographics, Economics, Employment, Housing Recovery, National Real Estate|33 Comments

No housing crisis yet…

Posted on November 23, 2019 by grim

From MarketWatch:

Existing-home sales rebound 1.9% in October as low mortgage rates continue to provide a lift

Sales of previously-owned homes rose 1.9% in October — the latest housing statistic to demonstrate the upward lift low mortgage rates have provided to the U.S. real-estate market.

Existing-home sales occurred at a 5.46 million seasonally-adjusted annual pace in October, up from a 5.38 million rate in September, the National Association of Realtors said Thursday. On a year-over-year basis, overall sales were up 4.6%.

Economists polled by MarketWatch had expected the average annual rate of existing-home sales to increase slightly more to 5.47 million.

…

The median sales price ticked up 6.2% over the past year to $270,900, as prices increased across all parts of the country. Unsold inventory was at a 3.9-month supply, down from 4.1 months in September and 4.3 months a year ago. Nearly half (46%) of homes sold in October were on the market for less than a month.

Sales volume varied from region to region, the National Association of Realtors reported. Sales rose in the Midwest and the South, but fell in the more expensive regions of the Northeast and the West.

Posted in Demographics, Economics, Housing Recovery, National Real Estate|77 Comments