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  • Employees asked about their canceled bonuses. The CEO warned them against living in ‘Pity City.’

    Employees asked about their canceled bonuses. The CEO warned them against living in ‘Pity City.’

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    The chief executive of the high-end office-furniture company MillerKnoll has gone viral. And probably not in a manner she would prefer.

    In a leaked Zoom call of a MillerKnoll staff town hall last month, CEO Andi Owen addressed concerns from employees about the company’s decision to withhold bonuses. It quickly descended into her lambasting staff for complaining about the move.

    “Questions came through about, ‘How can we stay motivated if we’re not going to get a bonus?‘ ” she says in the meeting recording. Owen — tapped in 2021 by Fast Company as one of the most creative people in business and celebrated that same year in the New York Times for her navigation of the coronavirus pandemic and swing-state sociopolitics — tells employees of the Zeeland, Mich., company to focus on things the company can control, such as customer service.

    From the archives (April 2021): Herman Miller and Knoll to merge in $1.8 billion deal that will create design leader as companies reimagine office

    “Don’t ask about: What are we going to do if we don’t get a bonus?” she says, growing animated, even, apparently, agitated. “Get the damn $26 million. Spend your time and your effort thinking about the $26 million we need and not thinking about what you’re going to do if you don’t get a bonus. All right? Can I get some commitment for that? I would appreciate that.”

    Though she didn’t specifically identify the significance of the $26 million figure, the company’s operating expenses rose by exactly that amount in its third quarter due to “voluntary and involuntary reductions in the company’s workforce and charges for the impairment of assets associated with the decision to cease operating fully as a stand-alone brand.”

    MillerKnoll’s third-quarterly filing showed that the furniture maker — the product of a 2021 merger of the Herman Miller and Knoll brands, behind products such as the Eames lounge chair and the Saarinen Tulip table, respectively — expects lower sales in the fourth quarter after posting a decline in orders and sales margins in the three months ending March 4.

    Owen recalls in the video that a past employer told her, “You can visit Pity City, but you can’t live there.”

    “So, people, leave Pity City,” she continues, exclaiming: “Let’s get it done.”

    “You have to be a psychopath to say this stuff to your employees when you are taking a massive bonus. Does she think they won’t find out?” asked one Twitter user.

    “Plenty going on here but one of many things that leapt out to me was that mere moments after she went with the ‘be kind to people’ bit, she was yelling at workers,” another said.

    The company said that the widely shared video clip had been taken out of context.

    “Andi fiercely believes in this team and all we can accomplish together, and will not be dissuaded by a 90-second clip taken out of context and posted on social media,” a spokesman said in a statement.

    Owen made $5 million last year. The company has yet to say how much she will make this year. The company this year has expensed $15.7 million in stock-based compensation.

    MillerKnoll shares
    MLKN,
    -2.38%
    have dropped 12% in 2023, compared with the 8% gain for the benchmark S&P 500
    SPX,
    +0.02%    .

    Other MillerKnoll brands include Design Within Reach, acquired by Herman Miller a decade ago and recognized as having made the iconic midcentury designs of Charles and Ray Eames, Isamu Noguchi, George Nelson, and others available to a wider, if affluent, audience without engaging an interior designer; the Danish design brand Hay; and Holly Hunt.

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  • 10 dividend stocks yielding at least 4.5% that are rated ‘buy’ by most analysts

    10 dividend stocks yielding at least 4.5% that are rated ‘buy’ by most analysts

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    During a period of high interest rates, it might be more difficult to impress investors with dividend stocks. But the stocks can have an important advantage over the long term. The dividend payouts can increase over the years, helping to push share prices higher over time.

    When considering stocks for dividend income, yield shouldn’t be the only thing you consider. If a stock’s price has tumbled because investors are worried about the company’s business prospects, the dividend yield might be very high. A double-digit yield might mean investors expect to see a cut to the dividend soon.

    There are many ways to look at companies’ expected ability to maintain or raise their dividend payouts. But one can also take a simple approach to begin researching stock choices.

    At the moment, you can get a bank CD with a yield of close to 5% pretty easily. Here’s a look at current yields for CDs and U.S. Treasury securities and an approach for laddering them not only to protect your cash but to hedge against interest-rate risk.

    For investors who would rather aim for long-term growth to go along with dividend income, or take a relatively conservative approach to growth while reinvesting dividends, a screen of stocks in the S&P 500
    SPX,
    +0.33%
    produces only 10 stocks with dividend yields of 4.5% or higher with majority “buy” or equivalent ratings among analysts polled by FactSet. Here they are, sorted by dividend yield:

    Company

    		 Ticker

    		 Dividend Yield

    		 Expected payout increase through 2025

    		 Share “buy” ratings

    		 April 16 price

    		 Consensus price target

    		 implied 12-month upside potential
    Comerica Inc.

    		 CMA,
    +4.00%         		6.56%

    		 10%

    		 58%

    		 $43.30

    		 $60.53

    		 40%
    Citizens Financial Group Inc.

    		 CFG,
    +4.19%         		5.77%

    		 12%

    		 74%

    		 $29.10

    		 $39.29

    		 35%
    Healthpeak Properties Inc.

    		 PEAK,
    +2.33%         		5.71%

    		 9%

    		 60%

    		 $21.01

    		 $27.69

    		 32%
    Hasbro Inc.

    		 HAS,
    +1.28%         		5.34%

    		 8%

    		 69%

    		 $52.40

    		 $69.27

    		 32%
    Philip Morris International Inc.

    		 PM,
    +0.46%         		5.11%

    		 11%

    		 67%

    		 $99.48

    		 $113.56

    		 14%
    Realty Income Corp.

    		 O,
    +1.30%         		5.04%

    		 7%

    		 56%

    		 $60.77

    		 $70.00

    		 15%
    Fifth Third Bancorp

    		 FITB,
    +3.33%         		4.99%

    		 3%

    		 72%

    		 $26.44

    		 $34.55

    		 31%
    VICI Properties Inc.

    		 VICI,
    +1.58%         		4.82%

    		 12%

    		 95%

    		 $32.35

    		 $37.73

    		 17%
    Organon & Co.

    		 OGN,
    +1.01%         		4.71%

    		 5%

    		 55%

    		 $23.80

    		 $31.89

    		 34%
    Iron Mountain Inc.

    		 IRM,
    +0.82%         		4.69%

    		 15%

    		 78%

    		 $52.76

    		 $56.00

    		 6%
    Source: FactSet

    Click on the ticker for more about each company.

    Click here for Tomi Kilgore’s detailed guide to the wealth of information available for free on the MarketWatch quote page.

    The dividend yields for this group of 10 companies are based on current annual regular payout rates, with all paying quarterly except for Realty Income Corp.
    O,
    +1.30%    ,
    which pays monthly.

    These two oil and natural gas producers would have passed the above screen based on their most recent dividend payments and analysts’ sentiment, however, they pay a combined fixed-plus-variable dividend every quarter, with the fixed portion relatively low:

    • Shares of Pioneer Natural Resources Co.
      PXD,
      -0.77%
      closed at $230 on April 14. Among analysts polled by FactSet, 59% rate the stock a “buy” or the equivalent, and the consensus price target is $257.42. The company pays a fixed quarterly dividend of $1.10 a share, which would make for a dividend yield of only 1.91%. However, the most recent variable quarterly dividend was $4.48 a share, for a combined quarterly dividend of $5.58, which would translate to an annualized dividend yield of 9.70%. The consensus estimate for dividends in 2025 is $4.63 — the analysts are only estimating the fixed portion of the dividend. Pioneer has held preliminary merger discussions with Exxon Corp.
      XOM,
      -1.16%      ,
      according to a Wall Street Journal report.

    • Devon Energy Corp.’s
      DVN,
      -0.72%
      stock closed at $55.70 on April 14. The shares are rated “buy” or the equivalent by 55% of analysts and the consensus price target is $67.66. The fixed portion of Devon’s quarterly dividend is 20 cents a share, for an annualized dividend yield of 1.44%. The variable portion of the most recent quarterly dividend was 69 cents a share. The total payout of 89 cents would make for an annual dividend yield of 6.39%. Analysts expect the fixed portion of annual dividends to total $3.61 in 2025, according to FactSet.

    Don’t miss: Buffett is buying in Japan. This overseas value-stock fund is also making bets there. Is it a good way to diversify?

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  • Putting the Japanese Art of Wabi Sabi Into Practice – Sotheby´s International Realty | Blog

    Putting the Japanese Art of Wabi Sabi Into Practice – Sotheby´s International Realty | Blog

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    Dana Lansing – Kurfiss Sotheby’s International Realty

    Is wabi sabi a philosophy or a design style? It’s notoriously difficult to delineate as a concept—so much so that in Wabi Sabi: The Japanese Art of Impermanence, author Andrew Juniper notes that “even the most ambitious Japanese scholars would give it a wide berth and uphold the Japanese tradition of talking about it in only the most poetic terms.”

    Unlike a typical Western understanding of philosophy, wabi sabi can’t be reduced to tenets, axioms, or principles, nor can it be summed up by a set of stylistic rules. Instead, it’s a lived, aesthetic experience that permeates the everyday—making the mundane appear sublime.

    To see the ethos of wabi sabi at work as both a visual style and a lifestyle, look to Villa Terra—a tranquil, 14-acre estate in Bucks County, Pennsylvania.

    An All-Encompassing Sense of Serenity

    Surfaces weathered and textured by time. Craftsmanship bearing the tell-tale traces of the human hand. Natural elements enhanced by objects, plants, and outdoor scenery. These are signature themes of a wabi sabi look, where contrived symmetry and artifice are superseded by a tangible appreciation for materiality and mutability.

    Dana Lansing – Kurfiss Sotheby’s International Realty

    At Villa Terra, a hewn entryway of stone steps leads straight to the heart of the home, where a foyer of simple, elegant furnishings leads to an expansive living room. Look underfoot at the tiles; unlike a typical show home where floors are uniform, every panel here is unique in tone and texture, unifying the organic, artistic, and authentic. The hearth is majestic because of its coarseness, matched by the coffee table—minimalistic in style, but maximalist in substance.

    Embrace the Perfection of Imperfections

    The name “Villa Terra” translates literally to “country house of the earth,” and the kitchen, with its rustic beauty and rough edges, demonstrates this with a distinctly wabi sabi aesthetic.

    Dana Lansing – Kurfiss Sotheby’s International Realty

    Notice how each of the hourglass stools differs slightly in structure, and how they’re neither planar, polished, nor even. Observe how the blemishes on the terracotta floors are flaunted rather than concealed, and how the woven rugs contribute layers of warmth and color without distracting from the functional simplicity of the space.

    The Beauty and Warmth of the Well-Worn

    How can wabi sabi be conveyed in words? “Wabi” (侘) has multiple meanings: simplicity, humility, melancholy, and an appreciation for serenity. Likewise, “sabi” (寂) is rich in possible interpretations, including the recognition that faded and worn-out objects have an intrinsic beauty. Together, they emphasize the value of reality and ephemerality—taking time to take stock of incredible beauty in an imperfect world.

    Dana Lansing – Kurfiss Sotheby’s International Realty

    With its remarkable views of the surrounding environment, Villa Terra’s primary suite invites quiet contemplation. Rugged stonework and raw textiles, juxtaposed with soft blankets and plush pillows, create an ambience of blissful, rejuvenating harmony.

    Admire the Nuances of Natural Textures

    Comfort is crucial. While wabi sabi interiors often appear spare, they’re not meant to be museums—seen but not touched; nor are they monasteries, where purpose overrides pleasure. Instead, they’re well-worn because they’re well-loved and built for a life well-lived.

    Dana Lansing – Kurfiss Sotheby’s International Realty

    The ensuite in Villa Terra epitomizes this, from the luminous wooden paneling of the custom sauna to the rich radiance of the terrazzo surfaces. It’s a space that’s beautiful in form because it’s beautiful in function, infused with an earthiness that feels as fabulous as it looks.

    Celebrate Transition and Transformation

    Wabi sabi is about engaging all the senses, which is why the grounds and gardens of Villa Terra are so spectacular. The breeze blowing through the canopy of the trees and the gentle babbling of Cooks Creek provide a soothing backtrack while enjoying the veranda, fire pit, and sunbathing patio. So too do the therapeutic aromas that change with the seasons, from blooming spring flowers to falling autumn leaves.

    If there’s a lesson to learn from wabi sabi, perhaps it’s that the only true flawlessness can be found in flaws, and the only true timelessness can be found in age. It’s in this spirit that homes like Villa Terra continue to awe and inspire their residents.

    Interested in learning more about features of Japanese design? See these six popular interior design trends.

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    Melissa Couch

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  • Heather Elias to Lead Pearl Certification’s Real Estate Division

    Heather Elias to Lead Pearl Certification’s Real Estate Division

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    CHARLOTTESVILLE, Va., April 17, 2023 (Newswire.com)
    –
    Pearl Certification, the industry’s foremost third-party certification program for high-performing homes, announces that Heather Elias, a real estate and marketing expert, will lead the company’s Real Estate Division as its new Vice President.

    “I’m thrilled to join a purpose-centered company that is striving to transform the national housing market for good,” said Elias. “The ‘north star’ of my nearly two decades of work in real estate has been to do everything I could to improve the industry, and this role gives me a unique opportunity to have a massive impact.” 

    As a true pioneer of the real estate industry’s digital era, Elias was one of the first real estate agents in the U.S. to leverage digital marketing to build a business by blogging about her local area when she became a REALTOR® 19 years ago.

    Prior to joining Pearl, Elias served as CEO of Artisan Consulting, advising numerous proptech companies as they expanded into the real estate industry. Her work included building and launching a national, referral-only real estate brokerage, creating and managing influencer/advocate programs, and developing recruiting and brand strategies for brokerages.

    Elias’s prior roles also included overseeing the social and digital strategy for the National Association of REALTORS® as its Director of Social Business Practice and championing the brand story for Century 21 Redwood Realty, leading the brokerage’s expansion to 12 offices and nearly 500 agents.

    “Pearl is delighted to welcome Heather to a key role in Pearl’s leadership team,” said Robin LeBaron, co-founder and president of Pearl Certification. “She has an exceptionally broad and deep knowledge of the real estate industry, with experience that spans marketing and branding, policy, proptech, and on-the-ground work as a salesperson. Heather’s leadership will be crucial to ensuring that Pearl continues to realize its brand promise — that energy-efficient, high-performing homes are properly valued at time of sale.” 

    To learn more about bringing knowledge of high-performing homes to the real estate industry or to join the Pearl Network, please visit pearlcertification.com/real-estate-pros/.

    About Pearl: Pearl Certification is the gold standard in high-performing home certifications, bringing visibility to the valuable features that make them healthy, safe, comfortable, and energy- and water-efficient. Pearl is the only national sponsor of the U.S. Department of Energy’s Home Performance with ENERGY STAR® program and is a partner with the National Association of REALTORS® Green Resource Council. Pearl has certified and provided appraisal addenda on over 132,000 homes in 44 states and Washington, D.C. Pearl Certified homes sell on average for 5.5% more than comparable homes, according to independent appraiser studies. https://pearlcertification.com/

    Source: Pearl Certification

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  • Homebuilder sentiment rises in April, as builders grab near-record share of the market

    Homebuilder sentiment rises in April, as builders grab near-record share of the market

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    Stacks of bricks outside a home under construction in the CastleRock Communities Sunfield residential development in Buda, Texas, U.S., on Wednesday, May 15, 2021.

    Sergio Flores | Bloomberg | Getty Images

    Builder sentiment in the market for newly built homes rose in April for the fourth straight month, as the supply of existing homes for sale remains scarce.

    The National Association of Home Builders/Wells Fargo Housing Market Index climbed to 45 in April, a 1-point gain. Anything below 50 is considered negative.

    The reading is the highest since September. The index stood at 77 in April 2022.

    Builders in the report cited a lack of listings on the resale market, which gave them an unusually strong edge. New listings of existing homes have fallen about 25% compared with a year ago.

    Slightly lower mortgage rates are also helping demand — though rates are still higher than they were a year ago.

    “Builders note that additional declines in mortgage rates, to below 6%, will price-in further demand for housing,” said Alicia Huey, NAHB chairman and a custom homebuilder and developer from Birmingham, Alabama. “Nonetheless, the industry continues to be plagued by building material issues, including lack of access to electrical transformer equipment.”

    The index has three components. Current sales conditions rose 2 points to 51.

    Meanwhile, sales expectations in the next six months increased 3 points to 50. It marked the first time both of the indicators were positive since June, when mortgage rates really took off.

    Buyer traffic, however, was unchanged at 31. It was the first time it hasn’t improved this year. 

    Builders said one-third of housing inventory is new construction, compared with historical norms of around 10%. Concerns had grown that builders might have more trouble with construction loans after recent regional bank failures.

    But the bevy of new construction suggests that is not the case.

    “While AD&C loan conditions are tight, there is not significant evidence thus far that pressure on the regional bank system has made this lending environment for builders and land developers worse,” said Robert Dietz, the NAHB’s chief economist.

    Sales incentives by builders, including mortgage rate buy-downs, have been successful in boosting demand in recent months. However, the share of builders reducing home prices is still dropping.

    Just under a third of builders reported cutting prices in April, down from 35% at the end of last year.  The average price reduction in April was 6%.

    The share of builders using incentives rose slightly to 59% in April from 58% in March. It was still lower than December’s read of 62%.

    Regionally, on a three-month moving average, builder sentiment in the Northeast rose 4 points to 46. In the Midwest, it rose 2 points to 37.

    In the South, it increased 4 points to 49. In the West, it rose 4 points to 38.

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  • Sweden’s economic gloom goes from bad to worse as government predicts steeper GDP contraction

    Sweden’s economic gloom goes from bad to worse as government predicts steeper GDP contraction

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    People in Sweden are feeling the effects of high inflation and tumbling house prices.

    JONATHAN NACKSTRAND / Contributor / Getty Images

    The Swedish government is now predicting a deeper than expected GDP contraction in 2023, according to data released Monday, worsening an already gloomy outlook for the country’s economy.

    Sweden’s Ministry of Finance estimated in December that GDP would shrink by 0.7%, but it now predicts a 1% downturn as it reassesses the “challenging economic environment.”

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    “We face major challenges, but we will get through them together,” Sweden’s Minister for Finance, Elisabeth Svantesson, said in a press release Monday.

    “Many people are struggling to make ends meet, so it is important for the Government to fight inflation and support those in the most difficult circumstances.”

    Sweden’s government had already described the country’s economic outlook for 2023 as “gloomy” in a report in October 2022, with the expectation that the economy would slip into recession. The latest CPI data shows inflation is finally starting to slow, but wages are limping behind and house prices are facing a serious downturn.

    The European Commission, the EU’s executive arm, echoed the downbeat tone in its latest growth outlook, in which Sweden is the only country where GDP growth is projected to slide into negative territory this year.

    The Commission predicted a drop of 0.8% for 2023, and a gain of 1.2% in 2024, which is the second-lowest estimate after Italy. So, where is the economy faltering?

    High inflation rates

    Sweden’s inflation rate is starting to cool, according to core CPI data released Friday, with the headline rate for March having fallen to 8% compared to 9.4% in the previous month, but the figure remains well above the central bank’s target rate of 2%.

    While March’s CPI data is a sign inflation is moving in the right direction, Swedish households are unlikely to get much reprieve from the figures.

    “People have lower purchasing power than they’ve had for a number of years … So many people struggle with basic things and also cut down on their consumption,” Ola Olsson, professor of economics and vice dean at the School of Business, Economics and Law at the University of Gothenburg, told CNBC before the inflation figures were released.

    The National Institute of Economic Research said last month that it expects inflation — excluding energy — to remain high throughout the year, and it will take until the second quarter of 2024 before it finally comes down below 2%.

    The Swedish think tank also warned it would take until 2025 before the economy clearly turns upward and an expected recession may now not be assumed to have ended until 2026.

    Expenses for homeowners have seen a sharp increase since 2020, according to the Homeowners Index by comparison service Zmarta. Housing expenses, which include costs involving the house and its plots such as electricity and water, tax and interest costs, currently come to 206,039 Swedish krona ($20,000) per year, compared to 116,483 per year as calculated in the first half of 2020.

    The inflation figure is also unlikely to impact the central bank’s interest rate hiking cycle, which unexpectedly started in April last year, according to Swedbank.

    “We maintain after [Friday’s] data that the Riksbank will hike by 50 basis points [on April 26],” the bank said in a note.

    Eroding real wages

    Most European countries are experiencing sky-high inflation, leaving real wages lagging behind. In Sweden, a new two-year wage agreement puts the benchmark increase in real pay at 4.1% for 2023 and 3.3% in 2024 – well below even the latest, slightly lower, inflation rate.

    Jens Magnusson, chief economist of Swedish bank SEB, told CNBC the figures give the Riksbank more time to tame inflation, but they mean Swedish people are losing around six to eight years of real income growth with the new agreement.

    “Households are pressured and we do see that the interest rate hikes have yet to have their full effect on households,” he added.

    The pressure on household income has prompted pay-related strikes across parts of Europe – but not in Sweden, where people accept real wage decline as an inevitability, according to Olsson.

    “There’s been a great acceptance … among people who work that we must have real wage decline this year because otherwise it will be like a wage-price spiral that can get out of hand, which we had in the seventies,” Olsson said.

    Plummeting house prices

    Swedish house prices have long been some of the strongest in Europe, but Stefan Ingves, who headed the country’s central bank from 2006 to 2022, has previously warned the country will face its “day of reckoning” thanks to a “dysfunctional” system.

    Riksbank's Ingves: Swedish inflation too high, but set to fall

    House prices then defied economists’ expectations when they experienced a second consecutive monthly uptick in March, according to Svensk Maklarstatistik data, but analysts have warned that a further downturn is still on the horizon.

    “We’re quite surprised by the unchanged price development [at] the beginning of the year in non-adjusted figures … I would call this a false dawn,” Gustav Helgesson, an analyst at Nordea, told CNBC before the latest house price data from Svensk Maklarstatistik was released.

    “We’re not out of the woods,” he added.

    Danske Bank recently revised its previous estimate of a 20% drop in real house prices, peak to trough, to a 25% drop. Prices are currently down by 12% from the peak recorded in February 2022, according to Danske, leaving prices “still only half-way to the bottom.”

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  • Three U.S. banks have reported ‘very solid’ results, says management consultancy

    Three U.S. banks have reported ‘very solid’ results, says management consultancy

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    Octavio Marenzi, CEO of Opimas, discusses recently released earnings by JPMorgan, Citi and Wells Fargo, and the areas of weakness.

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  • Why 5% interest rates might not derail the stock market or the U.S. economy

    Why 5% interest rates might not derail the stock market or the U.S. economy

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    Here’s a thought for investors: If the Federal Reserve raises interest rates to 5% or more would that wreck the economy and stock prices ?

    The U.S. stock market has been rallying to start 2023, clawing back a big chunk of the painful losses from a year ago. The bullish tone has been linked to a view that the Federal Reserve will need to cut interest rates this year to prevent a recession, reversing one of its quickest rate-increasing campaigns in history.

    Doomsday investors, including hedge-fund billionaire Paul Singer, have been warning against that outcome. Singer thinks a credit crunch and deep recession may be necessary to purge dangerous levels of froth in markets after an era of near-zero interest rates.

    Another scenario might be that little changes: Credit markets could tolerate interest rates that prevailed before 2008. The Fed’s policy rate could increase a bit from its current 4.75%-5% range, and stay there for a while.

    “A 5% interest rate is not going to break the market,” said Ben Snider, managing director, and U.S. portfolio strategist at Goldman Sachs Asset Management, in a phone interview with MarketWatch.

    Snider pointed to many highly rated companies which, like the majority of U.S. homeowners, refinanced old debt during the pandemic, cutting their borrowing costs to near record lows. “They are continuing to enjoy the low rate environment,” he said.

    “Our view is, yes, the Fed can hold rates here,” Snider said. “The economy can continue to grow.”

    Profits margins in focus

    The Fed and other global central banks have been dramatically increasing interest rates in the aftermath of the pandemic to fight inflation caused by supply chain disruptions, worker shortages and government spending policies.

    Fed Governor Christopher Waller on Friday warned that interest rates might need to increase even more than markets currently anticipate to restrain the rise in the cost of living, reflected recently in the March consumer-price index at a 5% yearly rate, down to the central bank’s 2% annual target.

    The sudden rise in interest rates led to bruising losses in stock and bond portfolios in 2022. Higher rates also played a role in last month’s collapse of Silicon Valley Bank after it sold “safe,” but rate-sensitive securities at a steep loss. That sparked concerns about risks in the U.S. banking system and fears of a potential credit crunch.

    “Rates are certainly higher than they were a year ago, and higher than the last decade,” said David Del Vecchio, co-head of PGIM Fixed Income’s U.S. investment grade corporate bond team. “But if you look over longer periods of time, they are not that high.”

    When investors buy corporate bonds they tend to focus on what could go wrong to prevent a full return of their investment, plus interest. To that end, Del Vecchio’s team sees corporate borrowing costs staying higher for longer, inflation remaining above target, but also hopeful signs that many highly rated companies would be starting off from a strong position if a recession still unfolds in the near future.

    “Profit margins have been coming down (see chart), but they are coming off peak levels,” Del Vecchio said. “So they are still very, very strong and trending lower. Probably that continues to trend lower this quarter.”

    Net profit margins for the S&P 500 are coming down, but off peak levels


    Refinitiv, I/B/E/S

    Rolling with it, including at banks

    It isn’t hard to come up with reasons why stocks could still tank in 2023, painful layoffs might emerge, or trouble with a wall of maturing commercial real estate debt could throw the economy into a tailspin.

    Snider’s team at Goldman Sachs Asset Management expects the S&P 500 index
    SPX,
    -0.21%
    to end the year around 4,000, or roughly flat to it’s closing level on Friday of 4,137. “I wouldn’t call it bullish,” he said. “But it isn’t nearly as bad as many investors expect.”

    Read: These five Wall Street veterans have 230 years of combined experience. Here’s why they are bearish on stocks.

    “Some highly levered companies that have debt maturities in the near future will struggle and may even struggle to keep the lights on,” said Austin Graff, chief investment officer at Opal Capital.

    Still, the economy isn’t likely to “enter a recession with a bang,” he said. “It will likely be a slow slide into a recession as companies tighten their belts and reduce spending, which will have a ripple effect across the economy.”

    However, Graff also sees the benefit of higher rates at big banks that have better managed interest rate risks in their securities holdings. “Banks can be very profitable in the current rate environment,” he said, pointing to large banks that typically offer 0.25%-1% on customer deposits, but now can lend out money at rates around 4%-5% and higher.

    “The spread the banks are earning in the current interest rate market is staggering,” he said, highlighting JP Morgan Chase & Co.
    JPM,
    +7.55%
    providing guidance that included an estimated $81 billion net interest income for this year, up about $7 billion from last year.

    Del Vecchio at PGIM said his team is still anticipating a relatively short and shallow recession, if one unfolds at all. “You can have a situation where it’s not a synchronized recession,” he said, adding that a downturn can “roll through” different parts of the economy instead of everywhere at once.

    The U.S. housing market saw a sharp slowdown in the past year as mortgage rates jumped, but lately has been flashing positive signs while “travel, lodging and leisure all are still doing well,” he said.

    U.S. stocks closed lower Friday, but booked a string of weekly gains. The S&P 500 index gained 0.8% over the past five days, the Dow Jones Industrial Average
    DJIA,
    -0.42%
    advanced 1.2% and the Nasdaq Composite Index
    COMP,
    -0.35%
    closed up 0.3% for the week, according to FactSet.

    Investors will hear from more Fed speakers next week ahead of the central bank’s next policy meeting in early May. U.S. economic data releases will include housing-related data on Monday, Tuesday and Thursday, while the Fed’s Beige Book is due Wednesday.

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  • Making a Splash: 4 Homes with Lovely Water Features – Sotheby´s International Realty | Blog

    Making a Splash: 4 Homes with Lovely Water Features – Sotheby´s International Realty | Blog

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    Whether dramatic or demure, a water feature brings calming sounds and natural visual appeal to any home. Each of these four properties—from East Coast to West—uses water to turn an outdoor area into an oasis that can be both striking and serene.

    Lush Brentwood Beauty

     Janelle Friedman | Sotheby’s International Realty – Santa Monica – Venice Brokerage

    This serene sanctuary occupies two lush acres in the heart of Brentwood. In addition to a stylish contemporary residence and a pool house with a bar and a sauna, it includes a tennis and sports court, a gazebo perfect for alfresco dining and games, expanses of green lawn, a dedicated flower and vegetable garden, a pergola with a fire pit, paths that wind through the acreage to a yoga and meditation platform, and a waterfall that links the relaxing spa with the swimming pool below.

    Eye-Catching Upper East Side Style

    Beverly J. Cole | Sotheby’s International Realty – East Side Manhattan Brokerage

    On a lovely tree-lined street between Lexington and Park Avenues, this impeccably renovated 7,200-square-foot townhouse offers an ideal flow for sophisticated living and entertaining. Highlights include five bedroom suites, a state-of-the-art kitchen, a wine cellar, a new elevator, a modern security system, and a spacious, shady arbored garden with a peaceful fountain. The 1899 building is a designated city landmark steps from popular restaurants and shops as well as Central Park.

    Modern Masterpiece

     Simon Beardmore | Sotheby’s International Realty – Brentwood Brokerage

    Perched on the verge of the Brentwood Country Club, this irreplaceable 5,598-square-foot residence exemplifies chic contemporary style. It boasts a spacious primary suite with walk-in closets, a chef’s kitchen with Miele appliances and a butler’s pantry, and a rooftop deck with an outdoor kitchen, a spa, and expansive golf course views. In the open living area, sets of Fleetwood doors offer a wide, picturesque view of the colorful backyard and its tranquil water feature and pool.

    Distinctive Houston Hideaway

    Lisa Marshall | Martha Turner Sotheby’s International Realty

    The light-flooded contemporary interiors of this distinctive 6,139-square-foot Houston home are ideal for entertaining and displaying an art collection. The residence features four spacious bedrooms, living and dining spaces, a wet bar, media and family rooms, and an elevator. Overlooked by the living room, family room, and superior kitchen through oversized windows, the striking swimming pool is accompanied by fire bowls, a summer kitchen, and dramatic deck jets.

    Discover luxury homes for sale and rent around the world on sothebysrealty.com

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  • Some Black families say they are ‘whitewashing’ their homes to get higher appraisals | CNN

    Some Black families say they are ‘whitewashing’ their homes to get higher appraisals | CNN

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    CNN
     — 

    Erica and Aaron Parker first had their Loveland, Ohio, home appraised in 2020. It was a competitive selling market, they had made several renovations to the home, and houses in the neighborhood were generally selling above the asking price.

    The couple expected the house to be valued at the list price of $525,000, but when the initial appraisal came back $60,000 short, the Parkers knew something wasn’t right.

    So they tried a different approach and also hired a different appraiser. The Parkers removed all items from the home that might signal they were Black, including artwork and family photos, and replaced them with photos and memorabilia borrowed from a White neighbor.

    The White neighbor sat in for the couple when the new appraiser came, and the result was a home appraisal of nearly $92,000 more than the first.

    “It was a weird feeling but we felt vindicated,” Erica Parker told CNN. “We were like, ‘Oh my God, we really were discriminated against.’”

    Parker’s account backs recent data showing that homes owned by Black people are significantly undervalued compared to White-owned homes. According to the Brookings Institute, homes in Black neighborhoods are valued at 23% less than those in non-Black neighborhoods despite having similar quality and amenities.

    Advocates for Black homeowners say this bias contributes to the racial wealth gap because it limits the financial returns of real estate for Black families.

    Some say it’s a systemic issue that industry leaders blame on a lack of diversity and a methodology that gives appraisers too much discretion in deciding the value of a home.

    According to the latest data from the US Bureau of Labor Statistics, 92% of property appraisers and assessors in 2022 were White and 4% were Black.

    Lydia Pope, president of the National Association of Real Estate Brokers, says her organization is working to recruit more Black people into the appraisal industry. The association hosts annual summits at HBCUs to encourage students to join the field, and Pope offers workshops and training for people already working in the real estate industry who want to learn how to do appraisals.

    “Our concern is that there aren’t enough Black appraisers in the business,” Pope says. “We just want to make a stand that we have to change the culture of appraising.”

    Pope calls it “disturbing” and “discouraging” that Black homeowners are having to “whitewash” their homes or conceal their race to get a higher appraisal.

    She says appraisers typically assess factors such as the condition of the property, upgrades and the value of recently sold comparable properties nearby.

    Jillian White, a Black appraiser who heads a consultancy that advises homeowners on disputing low appraisals, says, however, that appraisers are able to use their own discretion and opinion to make adjustments to the value of a home, and that leaves room for bias.

    “I think it’s systemic, implicit, explicit and structural,” White says of appraisal bias. “You have all these inflection points where making different decisions can lead to a very different result. The methodology is not so hard and fast that every appraiser is going to come up with the same value.”

    White says the industry needs to implement more guidance and protections so that appraisers have less autonomy in the process.

    Joshua Walitt, president of the National Association of Appraisers – which condemned discrimination among professional appraisers last year – says the methodology is not the problem. Instead, Walitt blames “bad apples” working in the profession for instances of bias.

    And even if there is bias, Walitt says it should have no influence on appraisal results given that these are based on market data.

    “If we follow methods and techniques which is what we focus on in education, then what it does is it pushes aside any bias that a person could have,” Walitt says. “If there is bad behavior then we need to let the investigations go through and take care of that.”

    Still, Walitt acknowledges that there is a need for more diversity in the industry. He says he is committed to expanding recruitment and supports programs such as Practical Applications of Real Estate Appraisal (PAREA) that make it easier for people to gain experience and join the industry.

    The issue of bias in home appraisals has gained the attention of President Joe Biden’s administration, which launched the Action Plan to Advance Property Appraisal and Valuation Equity (PAVE) last year to promote equity in the home appraisal process. In late March, the administration announced progress in this effort including publishing guidance so Federal Housing Administration (FHA) borrowers know how to request a “Reconsideration of Value” if they suspect bias in their appraisal.

    White says she wants Black homeowners to know their options when appraisals come in low. She advises her clients to appeal the first appraisal and if that doesn’t work request a second appraisal. If nothing changes, White says homeowners can file complaints with the Department of Housing and Urban Development, the state appraiser board, or the Consumer Financial Protection Bureau.

    Claims of bias have also to led to successful legal challenges from some homeowners. In March, San Francisco area Black couple Paul Austin and Tenisha Tate-Austin settled a discrimination lawsuit against a real estate appraisal company after their home was undervalued by nearly $500,000. As part of the settlement, the couple is set to receive an undisclosed amount of money and the firm is required to attend housing discrimination prevention training.

    “Having to erase our identity to get a better appraisal was a wrenching experience,” Tate-Austin said in a statement released by her lawyers to the San Francisco Chronicle. “We hope by bringing attention to our case and this lawsuit settlement, we can help change the way the appraisal industry operates.”

    Erica Parker says they ultimately sold the house in Loveland for $507,500 and bought a new home in Westchester, Ohio. However, she filed a discrimination complaint with both HUD and the Ohio Department of Commerce. Neither has yet been settled, she said.

    She says her experience only affirms that racism still exists in real estate.

    “We want the bank and appraisal company to be held responsible for what they did and to prevent this from happening to other people of color,” Parker said.

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  • Justice Clarence Thomas failed to disclose 2014 real estate deal with GOP megadonor, ProPublica report finds | CNN Politics

    Justice Clarence Thomas failed to disclose 2014 real estate deal with GOP megadonor, ProPublica report finds | CNN Politics

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    CNN
     — 

    Justice Clarence Thomas failed to disclose a 2014 real estate deal he made with a GOP megadonor, according to a ProPublica report published Thursday.

    The deal involved the sale of three properties in Savannah, Georgia, that were owned by Thomas and his relatives to the megadonor, Harlan Crow, according to ProPublica, which said that tax and property records showed that Crow made the purchases through one of his companies for a total of $133,363.

    But Thomas “never disclosed his sale of the Savannah properties,” the report said, noting that ethics law experts told the outlet that his failure to report it “appears to be a violation of the law.”

    “The transaction marks the first known instance of money flowing from the Republican megadonor to the Supreme Court justice,” ProPublica said in its report.

    Thursday’s report comes on the heels of a bombshell investigation published last week by ProPublica that detailed Thomas and his wife’s luxury travel with the Crows, which included trips on the donor’s yacht and private jet. The justice also did not disclose that travel, and he later defended the decision not to, saying in a rare statement last week that he was advised at the time that he did not have to report it.

    CNN has reached out for comment from the Supreme Court and Thomas.

    Crow said in a statement to CNN that he purchased the properties to “one day create a public museum at the Thomas home dedicated to telling the story of our nation’s second black Supreme Court Justice.”

    He added that he made the purchases at “market rate based on many factors including the size, quality, and livability of the dwellings.”

    Though two of the properties were later sold by Crow, according to his statement, the real estate magnate still owns the property on which Thomas’ elderly mother lives. Citing county tax records, ProPublica said one of Crow’s companies pays the “roughly $1,500 in annual property taxes on Thomas’ mother’s house,” which had previously been paid by the justice and his wife, Ginni.

    Experts told ProPublica that Thomas’ failure to disclose the 2014 deal raises more questions about his relationship with Crow.

    “He needed to report his interest in the sale,” Virginia Canter, a former government ethics lawyer who now works for Citizens for Responsibility and Ethics in Washington (CREW), told the outlet. “Given the role Crow has played in subsidizing the lifestyle of Thomas and his wife, you have to wonder if this was an effort to put cash in their pockets.”

    The report has already prompted the watchdog group to call for an investigation into Thomas’ decision not to disclose the real estate deal and the various trips and gifts.

    In a letter sent Friday to Chief Justice John Roberts and Attorney General Merrick Garland, CREW said that Thomas may have violated the Ethics in Government Act. The group said Roberts also should investigate whether Thomas violated his “ethical obligations” under Judicial Conference regulations.

    In the wake of last week’s revelations, congressional Democrats have also called for an investigation into the matter and for a stronger ethics code for the justices, and some federal judges have also spoken out.

    Earlier this week, the Senate Judiciary Committee announced it plans to hold a hearing “on the need to restore confidence in the Supreme Court’s ethical standards,” and at least one watchdog group has urged lawmakers to call Thomas as a witness in the upcoming hearing.

    This story has been updated with additional details Friday.

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  • Luxury real Estate Headlines: Second Week in April, 2023 – Sotheby´s International Realty | Blog

    Luxury real Estate Headlines: Second Week in April, 2023 – Sotheby´s International Realty | Blog

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    Highlights from this week’s top news stories on luxury and global real estate, art, collectibles, and home.

    Wilson, Wyoming | Jackson Hole Sotheby’s International Realty

    Located on prime fishing land, this 11,532-square-foot log residence sits on 53.64 acres.

    Historic Georgia Home That’s Hosted Presidents and Celebrities Coming to the Market – Mansion Global

    Don’t miss this showstopper with arena, incredible house and jaw-dropping views – Horse & Hound

    Peak Real Estate: This Tiny Wyoming Community Has Some of the Country’s Priciest Mountain Homes – The Wall Street Journal

    A Pristine, International Style Home Seeks $1.4M in Michigan – Dwell

    8 Best Places to Live in North Carolina — From Big Cities to Small Towns – Travel + Leisure

    Princeton manor designed by Mar-a-Lago architect lists for $4.3M – 6sqft

    Hot Property: Have the Whole Thing in Woods Hole – Boston Herald

    Friendly and Sedate, Nashville’s Oak Hill Offers a Relaxed Lifestyle That’s Close to Everything – Mansion Global

    A Fashion-Forward Milan Apartment Blending Period Details and Fresh Updates Asks $2.3M – Cottages &

    Gardens

    A Texas Castle—Complete With Turrets and Battlements—Lists for $7.85 Million – Mansion Global

    Two of Jackie Kennedy’s Former Georgetown Homes Are For Sale – Town & Country

    Sprawling Artist’s Retreat in New Mexico Desert Offers Inspiration on 11 Acres – Realtor.com

    6 distinctive homes full of color – The Week

    ‘Mountain Retreat’ in Santa Fe Listed for $3.97M – Albuquerque Business First

    Portugal Will Weather the End of Its Golden Visa Program Just Fine – Mansion Global

    Homes for Sale in Connecticut and New York – The New York Times

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    Melissa Couch

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  • Today’s homebuyers have their mortgage rate tipping point, and it’s artificially low

    Today’s homebuyers have their mortgage rate tipping point, and it’s artificially low

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    Today’s homebuyers are exceptionally sensitive to mortgage rates with house prices so high — and they’ve found their tipping point.

    After years of government intervention following the great recession and the first years of the Covid-19 pandemic that kept mortgage rates artificially low, today’s buyers have a skewed view of what “normal” mortgage rates are.

    The majority of potential homebuyers, 71%, say they will not accept a 30-year fixed mortgage rate over 5.5%, according to a survey done in March by John Burns Research and Consulting. The current rate, however, is around 6.4%.

    In addition, 62% of buyers said they believed that a “historically normal mortgage rate” was below 5.5%. The average going back to 1971 is 7.75%, according to Freddie Mac.

    Homes in Centreville, Maryland, US, on Tuesday, April 4, 2023. 

    Nathan Howard | Bloomberg | Getty Images

    “Our consulting team has witnessed this across the country, noting that home builders who choose to subsidize buyers’ mortgage rates, bringing the overall rate down below 5.5%, have been achieving the most success. Many of the largest builders in the country have been buying mortgage rates down below 5.0%,” said CEO John Burns and Maegan Sherlock, a senior research analyst, in the report.

    For most buyers, the mortgage rate determines what they can afford, because generally they are focused less on the home price and more on the monthly payment; that monthly payment is all about the rate.

    If so many potential buyers, however, are saying they won’t buy unless they get a rate below 5.5%, they may be sitting on the sidelines for a while. Mortgage rates have been over 6% for nearly a year and are not expected to move much lower this year.

    An April survey from U.S. News and World Report seems to corroborate these findings: It found that 66% of Americans who plan to buy a home this year said they are waiting until rates fall. 

    “Mortgage rates are about twice as high now as they were a little over a year ago, which has exacerbated housing affordability challenges ahead of the spring 2023 homebuying season,” wrote Erika Giovanetti, loans expert at U.S. News, in a column discussing the survey’s findings. “Today’s homebuyers are extremely sensitive to fluctuating interest rates, and a significant drop in mortgage rates would likely make the market more competitive.”

    The U.S. News survey also found that 25% of homebuyers who are holding out for lower rates are waiting until they drop below 5%. Nearly two-thirds of respondents said they’ve had to reduce their housing budgets due to the current level of mortgage rates.

    While some buyers can’t afford the home they might want at today’s rates, others are choosing not to buy simply because they don’t like the idea of a higher rate, even if they can afford it. Older consumers aren’t necessarily more willing to accept higher rates just because they may have experienced them in the past, according to the John Burns report.

    Potential home sellers, likewise, find the current rates to be unacceptable, contributing to the severe lack of supply on the market. New listings in the four weeks ended April 9 were 25% lower than the same week the year before, according to Redfin, a real estate brokerage. That continues an eight-month streak of double-digit declines.

    “Even if the Fed chooses not to hike interest rates next month, which would likely bring down mortgage rates, the limited supply of homes for sale would remain a major obstacle for would-be buyers,” wrote Daryl Fairweather, chief economist at Redfin, in the report. “Rates dipping below 6% would probably pique the interest of more buyers, but enough homeowners have rates in the 3% or 4% range that we’re unlikely to see a big uptick in new listings.”

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  • The fallout from empty offices is coming. Here’s where investors could see the pain

    The fallout from empty offices is coming. Here’s where investors could see the pain

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  • Fears mount that Europe’s commercial real estate sector could be the next to blow

    Fears mount that Europe’s commercial real estate sector could be the next to blow

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    Investors are questioning the health of the commercial real estate sector following a string of recent banking crises.

    Mike Kemp | In Pictures | Getty Images

    Concerns are mounting around the health of Europe’s commercial real estate market, with some investors questioning whether it could be the next sector to blow following last month’s banking crisis.

    Higher interest rates have increased the cost of borrowing and depressed valuations in the property sector, which in recent years reigned supreme amid low bond yields.

    Meanwhile, the collapse in March of U.S.-based Silicon Valley Bank and the later emergency rescue of Credit Suisse prompted fears of a so-called “doom loop,” in which a potential bank run could trigger a property sector downturn.

    The European Central Bank earlier this month warned of “clear signs of vulnerability” in the property sector, citing “declining market liquidity and price corrections” as reasons for the uncertainty, and calling for new curbs on commercial property funds to reduce the risks of an illiquidity crisis.

    Already in February, European funds invested directly in real estate recorded outflows of £172 million ($215.4 million), according to Morningstar Direct data — a sharp contrast from the inflows of almost £300 million seen in January.

    Analysts at Citi now see European real estate stocks falling by 20%-40% between 2023 and 2024 as the impact of higher interest plays out. In a worst-case scenario, the higher-risk commercial real estate sector could plummet 50% by next year, the bank said.

    A reckoning for office space

    The office segment — a major component of the commercial real estate market — has emerged as central to potential downturn fears given wider shifts toward remote or hybrid working patterns following the Covid pandemic.

    “People are concerned that the back-to-office hasn’t really materialized, such that there are too many vacancies and yet there is too much lending in that area, too,” Ben Emons, principal and senior portfolio strategist at U.S.-based investment manager NewEdge Wealth, told CNBC’s “Squawk Box Europe” last month.

    People are trying to understand which banks have lent where, to what sector, and what’s really the ultimate risk.

    Ben Emons

    principal and senior portfolio strategist at NewEdge Wealth

    That has deepened worries about which banks may be exposed to such risks, and whether a wave of forced sales could lead to a downward spiral.

    According to Goldman Sachs, commercial real estate accounts for around 25% of U.S. banks’ loan books — a figure that rises to as much as 65% among smaller banks, the focus of recent stressors. That compares to around 9% among European banks.

    “I think people are trying to understand which banks have lent where, to what sector, and what’s really the ultimate risk here,” Emons added.

    Amid that uncertainty, and what it called stretched valuations, Capital Economics last month increased its forecast for a peak-to-trough euro zone property sector correction from 12% to 20%, with offices expected to come off worst.

    “We see this financial distress, or whatever you want to brand it, as a catalyst for a deeper adjustment in value than we previously expected,” Kiran Raichura, Capital Economics’ deputy chief property economist, said in a recent webinar.

    Risks in Europe less acute than in the U.S.

    Not everyone is convinced of a forthcoming downturn, however.

    Pere Vinolas Serra, chief executive of Spanish real estate company Inmobiliaria Colonial and chairman of the European Public Real Estate Association (EPRA), said the situation in Europe looks paradoxically strong.

    Among the various factors at play, the return-to-office trend has been stronger in Europe than the U.S., he said, while office “take-up” — or occupancy — rates have been higher on the continent.

    “What is striking is that the data shows it’s better than ever,” Vinolas told CNBC via Zoom. “There’s something totally different going on in the U.S. versus Europe.”

    European funds invested directly in real estate recorded outflows of £172 million compared to inflows of almost £300 million seen in January, according to data from Morningstar Direct.

    Westend61 | Getty Images

    As of late 2022, European office vacancy rates stood at around 7%, well below the 19% in the U.S., according to real estate adviser JLL. Within Inmobiliaria Colonial’s portfolio, Vinolas said current vacancy rates were even lower, at 0.2% in Paris and 5% in Madrid.

    “I’ve never seen that in my life. The data on occupancy rates is at the very highest level,” Vinolas said.

    JP Morgan mirrored that view late last month, saying in a research note that fears of a U.S. downturn spreading to Europe were overblown.

    “Fundamentally, we believe that any contagion from either U.S. banks or U.S. CRE (commercial real estate) onto European peers is not justified, given different sector dynamics,” analysts at the bank said.

    Uncertainties and opportunities ahead

    Still, uncertainties remain in the sector, analysts warned.

    Of particular concern is the concentration of funding from non-bank lenders — or so-called shadow banks — which have picked up the slack in the wake of tighter regulation on traditional banks, said Matthew Pointon, senior property economist at Capital Economics.

    Prior to the global financial crisis, Europe’s traditional banks would offer loans of 80% of a building’s value. Today, they rarely go above 60%.

    The challenge will be for those non-sophisticated players, those who have a building that they have to adapt.

    Pere Vinolas Serra

    chief executive of Inmobiliaria Colonial

    “A lot less is known about these [shadow banks], and they may be more vulnerable to rising interest rates for example. So that’s an unknown that could throw a spanner in the works,” Pointon said.

    Meantime, incoming EU and U.K. energy efficiency standards will require significant investment, particularly in older buildings, and could see some real estate owners come under further pressure over the coming years.

    “I think the challenge will be for those non-sophisticated players, those who have a building that they have to adapt to new requirements,” Vinolas said.

    “At that level — which is a large amount, by the way — there could be a huge impact but also huge opportunities,” he added.

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  • The Middle East is the ‘nexus’ of energy and real estate capital markets, says venture capital firm

    The Middle East is the ‘nexus’ of energy and real estate capital markets, says venture capital firm

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    Brendan Wallace, co-founder and managing director at Fifth Wall, says the Middle East is the “natural place” to think about when it comes to the “imperative” to decarbonize the real estate industry.

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  • Average long-term US mortgage rate drops a 5th straight week | Long Island Business News

    Average long-term US mortgage rate drops a 5th straight week | Long Island Business News

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    The average long-term U.S. mortgage rate inched down for the fifth straight week, positive news for potential home buyers and a real estate market that’s been chilled by the Federal Reserve’s series of interest rate hikes the past year.

    Mortgage buyer Freddie Mac reported Thursday that the average on the benchmark 30-year rate ticked down to 6.27% from 6.28% the previous week. The average rate last year at this time was 5%.

    The average long-term mortgage rate hit 7.08% in the fall — a two-decade high.

    The recent decline in mortgage rates is good news for prospective homebuyers, many of whom were pushed to the sidelines during the past year as the Federal Reserve raised its main lending rate nine straight times in a bid to beat back stubborn, four-decade high inflation.

    Though supply remains low, home prices are retreating slightly, another development that could lure buyers back into the market. The national median home price slipped 0.2% from February last year to $363,000, marking the first annual decline in 13 years, according to the National Association of Realtors.

    Rising borrowing costs can add hundreds of dollars a month in costs for homebuyers and cooled off a red-hot housing market. Before surging 14.5% in February, sales of existing homes had fallen for 12 straight months to the slowest pace in more than a dozen years.

    In 2022, existing U.S. home sales fell 17.8% from 2021, the weakest year for home sales since 2014 and the biggest annual decline since the housing crisis began in 2008, the National Association of Realtors reported earlier this year.

    In their latest quarterly economic projections, Fed policymakers forecast that they expect to raise that key rate just once more — from its new level of about 4.9% to 5.1%, the same peak they had projected in December.

    While the Fed’s rate hikes do impact borrowing rates across the board for businesses and families, rates on 30-year mortgages usually track the moves in the 10-year Treasury yield, which lenders use as a guide to pricing loans. Investor expectations for future inflation, global demand for U.S. Treasurys and what the Federal Reserve does with interest rates can also influence the cost of borrowing for a home.

    Treasury yields have fluctuated wildly since the collapse of two mid-size U.S. banks last month. The yield on the 10-year Treasury, which helps set rates for mortgages and other important loans, was at 3.41% Thursday but had been above 4% early in March.

    The rate for a 15-year mortgage, popular with those refinancing their homes, fell this week to 5.54% from 5.64% last week. It was 4.17% one year ago.

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    The Associated Press

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  • Life of Luxury | Always On-Brand in Boston’s Back Bay – Sotheby´s International Realty | Blog

    Life of Luxury | Always On-Brand in Boston’s Back Bay – Sotheby´s International Realty | Blog

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    Michael Carucci – Gibson Sotheby’s International Realty

    Luxury and opulence define the world’s most iconic labels, along with spectacular service. To be a patron of prestigious institutions is to be an insider who’s recognized and appreciated in a way that always feels authentic and personal, and these characteristics have long been associated with the Four Seasons brand of five-star hotels. 

    Towering over Boston’s elite Back Bay neighborhood is the Four Seasons Residences at One Dalton, designed by acclaimed architect Henry Cobb and renowned for being the tallest residential skyscraper in New England. From your perch on the 55th floor, you can settle within the residence’s luxurious embrace and strike out for a leisurely day of exploration.

    Morning: Start with a Spa Treatment

    The first thing you notice when awakening in your climate-controlled primary suite is the scenery beyond your floor-to-ceiling windows. Your home—featuring more than 4,100 square feet of interior space and 11-foot ceilings—offers superior views of the city extending out toward the scintillating blue of the Atlantic, with the landmark Prudential Tower poised to one side.

    From your private foyer, it’s a quick ride down to the second level, where the chic One + One restaurant serves you an energizing breakfast. Then, it’s on to the Wellness Floor and its private collection of amenities featuring yoga and pilates studios, a fitness center designed by Harley Pasternak, and a heated indoor pool with panoramic windows spread over 20,000 square feet. Today, your main focus is the spa, where a massage provides the finishing touch to a perfect morning.

    Noon: Lounge and Browse Leisurely

    Midday approaches, and you’re feeling refreshed. You settle in at 50/50—the private residents’ club lounge on the 50th floor—and look out over the Charles River, and enjoy the world-class interior design by Thierry Despont.

    After a short while, you return to your apartment to make plans for the rest of your day. You access the Four Seasons Residence mobile app and request laundry pick up from your residence while you’re out. From pet care to concierge services to drycleaning pickup, everything you need can be arranged as One Dalton owners enjoy access to all Four Seasons services available at this location.

    It’s then that you head to Zuma on the second floor for lunch. The izakaya-inspired brand has garnered acclaim from London to New York, and One Dalton hosts its 12th and latest restaurant.

    After your meal, you stop by Private Residents Entertainment Gallery for a few swings on the golf simulator, and consider returning later that evening for a screening in the private theater. For now, it’s time to hit the shops, and you continue to the residential lobby, with 24-hour security, valet, and concierge service. As you pass, you enjoy the aesthetics of its porte-cochère entrance, as well as the serene silence ensured by its triple-layer glass façade.

    Copley Place—the popular mall that neighbors such iconic landmarks as the Boston Public Library and Trinity Church—hosts an impressive selection of fashion boutiques, including Gucci, Burberry, Louis Vuitton, Salvatore Ferragamo, and Jimmy Choo. And it’s connected by a sky bridge to the Prudential Center, where you can peruse the apparel at Saks Fifth Avenue and the delicacies at Eataly.

    Night: Apéritifs and Catered Cuisine

    Since The Pru is so close to One Dalton, it takes no time to stroll home, where you stop in at Trifecta for a drink. The street-level lobby bar is well-known in Back Bay, and dazzles with creative cocktails and a comprehensive wine list. The food menu also has some tantalizing specials—but today, with the easy bliss of the day and the beauty of the early evening, you feel like having dinner in your own space.

    Fortunately, in-residence dining service means you can have a restaurant meal while watching the sunset from the marble island’s nook in your contemporary kitchen. When you’re finished, you warm yourself in front of the onyx fireplace and sip a nightcap from your nearby wet bar.

    From beginning to end, today has been a curated experience, courtesy of some of the world’s best brands and designers. And with such an enormous array of wellness services and dining options to choose from, life at One Dalton never loses its thrill.

    Read more from our Life of Luxury series.

    Revisit the day at One Dalton

    One Dalton, The Pru, One + One Restaurant, Zuma, Copley Place, Eataly, Trifecta

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    Melissa Couch

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  • Commercial real estate crash will be as least as bad as 2008 financial crisis, says Patrick Carroll

    Commercial real estate crash will be as least as bad as 2008 financial crisis, says Patrick Carroll

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    Patrick Carroll, Carroll Founder and CEO , joins ‘Squawk on the Street’ to discuss signs of weakness in the housing market, the commercial real estate crisis, and the repurposing office buildings as more people work remotely.

    05:23

    Thu, Apr 13 202312:14 PM EDT

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  • The fight on inflation is starting to work, analyst says

    The fight on inflation is starting to work, analyst says

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    Jeff Taylor, founder and managing director at Digital Risk, discusses the latest U.S. inflation data and the impact of recent banking volatility on the housing sector.

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