Weekly News (April 15, 2020)
This week’s Interest Rate (16th Week)
(Fairway Asset Corp.)
30 Y Rate: 3.490%/ 15 Year Rate:2.875%/ 10 Y Treasury: 0.879%/ FHA:3.490%
Prime Rate:3.0% / Ref IR: 0.00- 0.25%
Conventional rates are getting better, but Government loans(FHA,VA, USDA) still have difficulties.
NY State might hit the Apex of COVID-19 death toll
( The Korea Times 4/14)
- As of 4/13, dealth toll is 10,056 in NY. The increase from previous day was 671 which was below 700 range.bbThe Governor Cuomo announced death toll curve become flat.
- Number of new positives was 1,985 which is the lowest for last 2 weeks.
- In order to prevent re-break, self -quarantine and social distancing are essential, the Governor added.
New York RE Market is facing tough time
(The Korea Daily 4/15)
- According to StreetEasy, NYC rental listings were reduced 57% between 3/16 and 3/27, compared to a year ago. This low profile will continue to the end of this year : It took about 2 years to recover after 9/11 crises while it took 9 month for the 2008-2009 financial crises.
- Rent prices were done 10% during the 2008-2009 crises, but COVID-19 situation will make deeper dip, especially with apartments for low level income. Even with lowered rent, still moving is not increased much.
- Office vacancy will go up and rent will be lowered. Cooling period will go on about a year.
New Inventory and contract signings in Manhattan continued to plunge
(The TRD this week)
- New inventory and contract signings in Manhattan continued to plunge during the third week of the state’s stay-at-home order. The borough’s housing market saw 52 new listings come to the market last week, an 89 percent drop from 476 listings a year ago, according to a report produced by UrbanDigs. The data firm compared the second week of April to the same period in 2019.
- Over the last three weeks — March 22 to April 14 — only 209 new homes hit the market. That’s an 87 percent drop from the same period in 2019, which saw 1,603 new listings.
“Zeus Living” started short-term rent for college students due to shutdown
- Long-term rental company Zeus Living, usually for corporate clients, has launched short term rent for college students who has been moved out from lockdown of their school dormitories.
- Zeus Living has started the business in 6 cities such as San Francisco , Boston, New York, LA, Seattle, Washington DC with 2400 apartment complexes by acquiring investment of $55M from Airbnb and others.
- The company received inquiries from 130 colleges after they announced promotion codes due to COVID-19 situation.
IMF forecasts worst year for the world since the Greta Depression in 2009
(The Record 4/15)
- According to IMF, the global economy might shrink 3% this year – far worse than its 0.1% dip in the Great Depression year of 2009 – before rebounding in 2021 with 5.8%. Far-reaching measures to contain pandemic – lock down, business shutdowns, social distancing and travel restrictions – have brought economic activity to a near-standstill across much of the world.
- World trade will plummet 11% this year and then grow 8.4% in 2021.
Banks set Billions aside bracing for Loan Losses due to Pandemic situation
(The NYT 4/15)
- The economic shutdown the Coronavirus has caused has already forced millions of Americans out of work and threatened the future of thousands of small business, and country’s biggest banks are bracing for the fallout.
- JP Morgan, the country’s biggest bank, added $8.3B to its reserves to prepare for impending defaults – $6.8B increase from the same quarters last year. The bank expected consumer loans – most of them credit cards – to lose $4.4B while commercial loans to small businesses in real estate, retail and oil and gas could lose $2.4B.
- Wells Fargo set aside $4B, which was an increase of $3.1B. The bank said $1B of it potential losses could come from loans to consumers and small businesses.
Laid off employees move to Amazon
- Amazon is focused in the employment market under Pandemic. According to WSJ, Amazon announced to hire 100,000 temp workers, and CEO Bezos said he hopes they can work at Amazon until they get back to work such as restaurants, hotel/motel workers, hourly work, entertainment businesses, etc.
- Already Amazon has hired 80,000 temp workers including former restaurant head chefs, music performers, some owners of small-mid size businesses, etc.