Slip, fall, dump: these are the adjectives ringing in this February’s real estate news. Mortgage rates slip after a month-long rise, California falls behind in home-price gains (has The Golden State lost allure?), and another tech giant decreases its San Francisco footprint. At least the California Apartment Association successfully defeated the ‘Stay in Business Forever Act.’ Sheesh.
Mortgage rates fall slowly after a month-long rise
The average 30-year-fixed rate mortgage fell one basis point from last week, sitting at 3.55%. Economists expect rates to increase gradually in 2022 but still hover close to record-low levels. The MBA and their crystal ball forecast that 30-year mortgage rates will reach 4% by the end of 2022. (Housing Wire)
California falls behind in home-price gains
Last year’s wild surge in California home value trailed mind-blowing gains elsewhere in the country. The continuance of this trend narrows the affordability gap between regions but just modestly. How do we interpret this “underperformance?” If you believe rising values are good, is this a warning shot that California is under economic stress, or is the aspiration to be a homeowner in The Golden State losing appeal? (East Bay Times)
Slack dumps more than 200,000 square feet on sublease market
The trend of San Francisco companies listing their offices is coming with us into 2022. In 2019, Slack HQ moved into a skyscraper across the street from Salesforce Tower, signing what was then the 3rd largest lease that year. Now the 200,000 square foot space is on the market again. Yet another tech giant decreasing its footprint in the city; why aren’t politicians talking about this? (Biz Journals)
CAA and its members defeat AB 854, the ‘Stay in Business Forever Act’
Over the past weeks, California Apartment Association members have fired off thousands of emails to Assembly members urging them to reject AB 854. On January 31st, they saw success. The CAA has officially defeated the ‘Stay in Business Forever Act.’ The act would have prohibited rental housing providers from using the Ellis Act to terminate tenancies, among other inconveniences. (CAA)
Eviction Legislation Gains Steam
As the new year starts to unfurl, the fate of eviction moratoriums across major US cities has attracted a spotlight. With many bans up for expiration, officials are debating whether to extend or adopt new legislation, leading to an inevitable renter-landlord group showdown. While Los Angeles extended its eviction moratorium this month until December 31st, 2022, the Apartment Association of Greater Los Angeles has stated that it will fight its case ‘out’ until the very end.” (Multihousing News)
Housing risk intensifying in the East, Midwest, and California
Despite high demand for homes and pretty low levels of distress due to the government relief applied as a result of the pandemic, the chokehold on certain markets doesn’t seem to be letting up. By the end of 2021, the counties most vulnerable to housing stress were concentrated in parts of California, the Midwest, and New York. Don’t expect this pressure to be released anytime soon. (National Mortgage News)
