Weekly News (March 27, 2019)
This week’s Interest Rate
- 30 Y Rate: 4.000%/ 15 Year Rate:3.620%/ 10 Y Treasury: 2.395%/ Prime Rate:5.5%
Ridgefield neighbors object Thermal Power Plant construction in Meadowland
- “North Bergen Liberty Power Plant” will be built in Meadowland swamp area across Ridgefield, which can produce 1,200 MW power and costs $1.5B. The power generated will be transferred to New York City through underneath Hudson River. New Jersey people might have to take damage for environmental contamination out of thermal power plant, which is to produce 2.6M Metric Tons of CO2 gas. This is equivalent to the gas exhaust amount from the biggest power plant “Phillips 66 Bayway” in Linden, NJ.
- 350 demonstrators including Loretta Weinberg (State senator), Anthony Suarez (Ridgefield Mayor), Dennis Shim (Ridgefield Councilman) got together to show strong objection for the plan on 3/21.
Hackensack, NJ is booming for real estate re-development with about 20 projects
- Recently Hackensack town has approved the development project at 150 River St for 654 apartment and 18,000 sf commercial space. The complex will be completed by 2021. The total cost would be $185M and town would expect $1.5M tax annually. Town will provide various tax exemption for next 30 years to the development company Garnet Group in order to attract the development and investment.
- 85 unit apartment will be built at 389 Main St.
- 235 unit apartment will be built at 437-439 and 445-451 Main St.
- At around same time, about 20 small and large development projects are moving forward.
New Jersey might be the best place for NongShim (RaMyun) America factory
- They responded that they would not consider Atlanta, GA as a choice, facing question on rumor they will consider two places between NJ and GA. Their considering factors are 1) Business friendly neighbor(state), 2) Lowe tax, 3) Easy transportation to Canada.
- The cost for a factory would be $100M and they will make a decision within this year.
- NongShim America reached to sales of $156M in 2015 and grew to $$225M in 2018 which means 44.2% growth.
- Market share of NongShim is 15% which is 3rd in US while 1st and 2nd are Japanese products. They have a current factory in East area of LA, CA.
Boutique apartments “Fifty58” open in Paramus in NJ
- Fifty58, the 45-unit luxury development at 58 East Midland Ave, Paramus started tenants moving in three weeks ago. This mixed-use building will have about 7000 sf retail space on the ground floor. The development was possible due to the zoning change in 2016 that allows multi-use and multi-family development from the Fashion Center down Rt 17 to Garden State Plaza.
- The rent is from $3,150 to $4,700 and the complex includes 4 affordable housing units, which can be reached to borough’s Affordable Housing Department (201-265-2100 ext.2220)
- Pet-friendly building is featured with a pool table, gym, two-level private lounge with fire-place, a furnished roof top with BBQ grill, and private covered parking. Interior is equipped with Pedini kitchens, quartz counter tops, balconies for some units.
Helicopter ride service becomes available between Manhattan and JFK at $195
- Helicopter service will take you from Manhattan to JFK in 5 minutes with the speed of 150 miles/hour. The company BLADE provides the service for $195 one way service between 7 am – 7 pm. By downloading application software Blade App, customers can make reservation or customers can use the lounge located between 30th St and 12th Ave.
- They will improve/expand the service in 5 years and the fee will be lowered to around $70-90.
NAR’s recent survey reports now is good time to buy houses on 2/20
- 37% of survey believes strongly now is a good time to buy, which is increased from 34% last quarter. At the same year before it was 38% while 35% of survey answers this is not a good time to buy which was decreased by 2% from last quarter.
- 53% agrees US economy is doing good while 59% agrees US economy is doing good last quarter.
- According to NAR Chief economist Lawrence Yun, 1) inventory is increased and therefore buyer has more choice 2) stable price trend would attract more people to Open House.
- 46% answers that house price will stay flat for next 6 months and it was increased by 2% from last quarter.
- 27% of renters says it will be difficult to get a mortgage approval and 28% says it will be somewhat difficult while 24% says it will be easy.
Real Estate Market looks bright – Increased sales nationwide
- In Febrary, sales is increased by 11.8% from last month, NAR reported, to 5.51M, adjusted yearly rate which is biggest monthly change since 2015. Sales has been decreased continually from Nov last year through Jan this year. Most reason is the lowered mortgage interest rate. Also 41% of sales were sold within a month.
- According to NAR chief economist Lawrence Yun, it happened because 1) lowered interest rate 2) increasing inventory 3) increasing income 4) consumer confidence index recovery.
- Median price nationwide in Feb was increased by 3% to $249,500 from $240,800 in last year.
- DOM in January was 49 while DOM in Febrary was 44.
- New construction is increased, but not enough : shortage of 300K.
- Multi-family/apartment took 1 of 5 in 2001, but changed to 1 out 3 in 2018.
- Income of the age between 25 – 44 is being increased for last 4 – 5 years which becomes positive news for real estate market.
- This year, in general, nationwide, medial price will be increased by 2.2% while sales will be decreased by 1%.
FHA might move to a stronger mortgage standards for first home buyer
- FHA warned on too high LTV, considering credit score and income level on 2/25. Typically FHA loan accept low down payment with MI (Mortgage Insurance). If they decided stronger standards, it will affect 40,000 – 50,000 application yearly. FHA explained that they loosened the standard in 2016 and it is the time to tighten up.
- So far, FHA accept the credit score of 620 and eased the rule of DTI ratio of 43%.