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Weekly News (July 20, 2022)

Mortgage Interest Rates Review (28th Week)
(by Fairway Home Loan)

 30 yr fx

(%)

 15 yr fx

(%)

FHA

(%)

10 yr Tr Y

(%)

5 Yr Arm

(%)

7 Yr Arm

    (%)

A year ago      2.799       2.125     2.490          1.370    
A month ago      5.250       4.250     4.750          2.968     4.500      4.750
Last week      4.999       3.999     4.625          2.908     4.750      4.875
This week      4.999       3.999     4.625          3.019     4.750      4.875

 

Laundry Biz shrinking NY area (뉴욕지역 세탁소 심각한 감소세)
( Korea Daily  7/14/2022)

  • About 2000 laundry biz around NY 5 boroughs are reducing to 1200-1600 according to the association. Among them, Korean owners are 90%.
  • Dry Cleaners Business hit severely during the pandemic while tougher environmental regulation, rent increase put them in worse situation.
  • The Dry Cleaners Association is seeking the financial support from NYC, the state, and the federal government, appealing that the industry was getting much less support compared to the restaurant industry during the pandemic.

 

 

Manhattan Ave. Rent over $5000 (맨하탄 평균 렌트비 $5000이 넘어)
(7/15/2022)

  • Elliman reported that average rent in Manhattan in June reached to $5,058 which is the record high, up 1.7% from last month, and up 29% from a year ago.
  • Studio up 2% from last month to $3,145/ 1Br up 3% to $4,278/ 3Br up 3.4%.
  • Lease transactions up 4.2% from last month to 5,143.
  • Vacancy rate dropped to 1.9% from 6.7% in June last year.
  • High rent in Manhattan pushes rent in neighbor area – rent in NE Queens up 1.7% to $3,352.

 

 

NY & NJ Governors signs MOU for “Gateway” (게이트 웨이 프라젝 청신호)
(New York State Dept)

  • Gov. Hochul and Murphy signed on 5th the Phase One Memorandum of Understanding which outlines sources, uses, and timing of funding for Portal Bridge and the Hudson Tunnel Project.
  • Phase One of the Gateway Program is funded by a combination of federal and local sources. On behalf of the states, PANYNJ’s total commitment for Phase One is $2.7 billion. For Portal North Bridge, federal funding sources total approximately 60% of the total cost, leaving the States’ PNB Commitment of $772.4 million to be split by New Jersey and New York at $386.2 million per state. For the rest of the Hudson Tunnel Project, the States will similarly split the local share 50-50.

 

 

Inflation Hurtles to Highest Since ’81 (6월 인플레이션, 9.1% 로 발표)
(WSJ  7/14/2022)

  • U.S. consumer inflation accelerated to 9.1% last month, a pace not seen in more than four decades, adding pressure on the Fed to act more aggressively to slow rapid price increases throughout the economy.
  • A big jump in gasoline price – up 11.2% from the previous month and nearly 60% from year ago – drove much of the increase while shelter and food prices were also major contributors.
  • The June inflation reading exceeded May’s 8.6% rate, prompting investors to debate whether the Fed would consider a 1% rate increase, rather than a 0.75% rise, later this month.

 

 

Rent Hike Rate in June is highest in 36 years (6월 렌트 상승률 36년만에 기록)
(Korea Times  7/18/2022)

  • Housing costs – rent, the record high in 36 years, contributed to June CPI increased to 9.1% as much as oil prices affected to.
  • As the Fed increased the federal funds rate aggressively, the mortgage interest rates are also affected and the forced out buyers in the housing market were moved to the rent market.
  • Some experts are saying the rent hike will hit the peak and cool down soon because rental complex construction is being increased to 836,000 multifamily housing projects currently which is record high since 1973.

 

 

Global Housing Boom Slows as Rates increased (세계 주택 시장 과열 식기 시작)
(WSJ 7/19/2022)

  • Rising interest rates are slamming the brakes on a global housing boom that spread far beyond the U.S. during the pandemic, heaping extra pressure on central banks.
  • The seasonally adjusted average home price in Canada was down nearly 8% in June from a peak earlier this year. In New Zealand, prices slipped 8% in June from their peak in 2021. Prices in Sweden in May fell 1.6% from the previous month, the biggest monthly decline since the pandemic began.
  • A shrinking real-estate sector means laid-off construction workers and weaker demand for steel and other commodities. Falling home prices hurt household and bank balance sheets, which tends to weigh on other parts of the economy.

 

 

Monthly Residential Construction Slips again (2달 계속 주택 신축 감소)
(WSJ 7/20/2022)

  • Residential construction in the U.S. slowed for the second straight month in June, as both housing starts and the number of building permits issued declined.
  • Housing starts fell 2% to a seasonally adjusted 1.56M, the Commerce Dept said Tuesday. Building permits slipped 0.6% to 1.69M but held 1.4% higher than the figure in the prior year. The drops came as interest rates climbed and a global housing boom faded.
  • Many builders are stopping construction due to inflation, land prices and rising home building costs among other factors, NAHB said.
    (NAR will release existing home sales figures for June today, forecasted 0.9% decline earlier)

Housing starts in U.S. (2019 – Current)

 

 

Fed Leans Toward Another 0.75% Increase, not 1% (연준위가 다시 0.75%  이자 상승쪽으로)
(WSJ  7/18 )

  • The Fed officials have signaled they are likely to raise rates by 0.75% point later this month for the second straight meeting, as part of an aggressive effort to combat high inflation.
  • Some officials pointed to signs that the economic activity was softening as they raise rates at a historically brisk pace. “You don’t want to overdo the rate increases. A 0.75-basis-point hike is huge,” Fed Governor Christopher Waller said Thursday.
  • With another 0.75-point rate at the coming meeting, the Fed will have raised the fed-funds rate by as much as its combined increases between 2015 and 2018. It would lift the rate to a range between 2.25% and 2.5%, closer to officials’ estimates of a neutral rate that neither stimulates nor restricts demand.

 


 

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Stephen Lee

He has been in Real Estate industry in about 20 years and has been Broker of Record for 9 years. His experience includes residential, commercial, and property management. Prior to involving with Real Estate business, he has been involved in the digital communication equipment industry utilizing his engineering background and education, including running own company. He has established C Land Realty in 2011 which has grown to staffing over 100 Real Estate agents and the annual transaction amount of over $110,000,000 today.

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