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  • Builder sentiment fell every single month in 2022. Builders say there’s a silver lining.

    Builder sentiment fell every single month in 2022. Builders say there’s a silver lining.

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    The numbers:  The National Association of Home Builders’ monthly confidence index fell two points to 31 in December, the trade group said on Monday.

    It’s the 12th month in a row that the index has fallen.

    Outside of the pandemic, the December reading of 31 is the lowest level since mid-2012.

    A year ago, the NAHB index stood at 84. The index’s 12-month drop is a new record. 

    But it’s not the biggest drop, the NAHB said. The drop in builder confidence between the end of 2004 and the start of 2009 was sharper; the index fell from 71 to 8 in that span.

    Key details: The three gauges that underpin the overall confidence index were mixed:

    • The gauge that marks current sales conditions fell by 3 points. 

    • The component that assesses sales expectations for the next six months rose by 4 points.

    • And the gauge that measures traffic of prospective buyers was unchanged from last month.

    All four NAHB regions posted a drop in builder confidence, led by the South and the Northeast. 

    Big picture: While builders continue to struggle to find buyers with the current rate environment, they’re also seeing a light at the end of the tunnel.

    Buyers are slowly coming back to the table as mortgage rates are no longer above 7%, and home price growth is moderating.

    And with 62% of builders offering incentives like mortgage rate buy-downs, paying points for buyers, and even price reductions, that luring some buyers, per the NAHB.

    About 35% of builders were dropping home prices in December, the NAHB said, with the average price reduction being 8%.

    What the NAHB said: “The silver lining in this HMI report is that it is the smallest drop in the index in the past six months, indicating that we are possibly nearing the bottom of the cycle for builder sentiment,” Robert Dietz, chief economist at the NAHB, said in a statement.

    “Mortgage rates are down from above 7% in recent weeks to about 6.3% today, and for the first time since April, builders registered an increase in future sales expectations,” he added.

    But the NAHB is expecting “weaker housing conditions” to persist in 2023, and only forecasts a full recovery in 2024, Dietz said. There is still a gap of 1.5 million housing units, they estimated nationwide.

    Nonetheless, the path to recovery is hard, the builders stressed.

    “In this high inflation, high mortgage rate environment, builders are struggling to keep housing affordable for home buyers,” Jerry Konter, chairman of the NAHB and a home builder and developer from Savannah, Ga., said in a statement.

    “With construction costs up more than 30% since inflation began to take off at the beginning of the year, there is little room for builders to cut prices,” Konter added.

    What are they saying? “We think home sales will find a floor by the end of the first quarter, helped by the near-75 [basis point] decline in mortgage rates since late October,” Kieran Clancy, senior U.S. economist at Pantheon Macroeconomics, wrote in a note.

    “But a meaningful recovery is still a long way off, and home prices have much further to fall,” he added.

    Market reaction: The yield on the 10-year Treasury note
    TMUBMUSD10Y,
    3.597%

    rose to 3.57% on Monday morning.

    While the SPDR S&P Homebuilders ETF
    XHB,
    -1.67%

    traded slightly lower during the morning session, as well as big home builder stocks like D.R. Horton Inc
    DHI,
    -1.44%
    ,
    Toll Brothers
    TOL,
    -0.87%
    ,
    and Lennar
    LEN,
    -2.28%
    .

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  • We don’t have ‘too much solid evidence’ that many companies left Hong Kong, CBRE says

    We don’t have ‘too much solid evidence’ that many companies left Hong Kong, CBRE says

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    Marcos Chan of the real estate services and investment firm says the contraction in demand for office space in the city has largely been driven by economic factors rather than the “so-called story that companies are leaving Hong Kong [for] other countries.”

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  • Housing slump likely to continue but some see hopeful signs ahead | CNN Business

    Housing slump likely to continue but some see hopeful signs ahead | CNN Business

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    A version of this story first appeared in CNN Business’ Before the Bell newsletter. Not a subscriber? You can sign up right here.


    New York
    CNN
     — 

    Mortgage rates have ticked down recently, but are still up dramatically from a year ago thanks to the surge in long-term bond yields as the Federal Reserve hiked interest rates.

    While that’s already had a negative impact on the housing market, we’ll get more details this week about how much worse the damage has become.

    A long list of housing data is on tap. On Tuesday the US Census Bureau will report housing starts and building permits figures for November, followed by Friday’s release of new home sales data for the same month. In between that will be the November existing home sales numbers from the National Association of Realtors on Wednesday, as well as weekly data on mortgage rates and applications on Thursday.

    For the past few months, existing and new home sales have been steadily declining because of the spike in rates and the fact that home prices remain stubbornly high for first-time buyers. Housing starts and building permits have been choppier on a month-to-month basis, but those figures are both down from a year ago.

    Still, there are some promising signs that the worst could soon be over. Shares of Lennar

    (LEN)
    , one of the largest homebuilders in the US, rallied after reporting earnings last week. Revenue topped forecasts and the company’s guidance for the number of homes it expected to deliver next year was a little higher than analysts’ estimates as well.

    Lennar investors “may be looking ahead to 2023, perhaps crossing the valley from recession to potential recovery,” according to CFRA Research analyst Kenneth Leon.

    Others in the industry are cautiously optimistic as well.

    According to data from Amherst Group, an investment firm that buys single-family homes to rent out, it’s important to put the recent slide in prices in context.

    Amherst said home prices are still up about 40% from pre-pandemic levels. So even a further drop of about 15% would merely bring them to mid-2021 levels. In other words, this isn’t like the mid-2000s real estate bubble bursting.

    It’s also worth noting that the job market is still strong and wages are growing. What’s more, many consumers still have decent levels of excess savings thanks to pandemic era government stimulus.

    That all amounts to a few good reasons why the housing market could avoid a severe and prolonged slump.

    “The U.S. housing market is still supported by a tight labor market, the lock-in effect of low fixed mortgage rates for existing homeowners, tight mortgage underwriting, low leverage in the mortgage sector, and low housing supply,” said Brandywine fixed-income analyst Tracy Chen in a report this month.

    “We believe we can avoid a severe housing downturn like the one in the Global Financial Crisis,” Chen added.

    Others point out that even though housing sales may remain weak due to high home prices and still elevated mortgage rates, the good news is that most existing homeowners are still paying their monthly mortgage on time.

    Again, that’s a stark contrast from 2008 when many people with subprime loans or borrowers with poor credit histories were unable to keep up with their mortgage payments.

    “Housing is not bringing down the economy. Yes, the housing market has been impacted. But mortgage delinquencies are still low,” said Gene Goldman, chief investment officer at Cetera Investment Management.

    There aren’t a ton of companies reporting their latest earnings this week. But the few that are could give more clues about the financial health of consumers and the state of corporate spending.

    Cereal giant General Mills

    (GIS)
    will release earnings on Tuesday. Analysts are expecting a slight increase in both sales and profit. Consumers may be growing increasingly wary about inflation and the broader economy, but they’re still eating their Wheaties. Shares of General Mills

    (GIS)
    have soared nearly 30% this year.

    Analysts are less optimistic about the outlooks for sneaker king and Dow component Nike

    (NKE)
    , used car retailer CarMax

    (KMX)
    and memory chip maker Micron

    (MU)
    , whose semiconductors are used in devices ranging from cell phones and computers to cars.

    Earnings are expected to decline for these three companies. They won’t be the only leaders of Corporate America to report weak results.

    According to data from FactSet, fourth-quarter earnings for S&P 500 companies are expected to decline 2.8% from a year ago. Analysts have been busy cutting their forecasts too. John Butters, senior earnings analyst at FactSet, noted in a report that fourth-quarter profits were expected to rise 3.7% as recently as September 30.

    Investors are also going to be paying very close attention to what companies say in their earnings reports about their outlooks for 2023. Analysts currently are anticipating earnings growth of 5.3% for 2023. That could be too optimistic… especially if companies start cutting their own forecasts due to worries about the broader economy.

    “Odds of a recession are pretty high,” said Vincent Reinhart, chief economist and macro strategist at Dreyfus & Mellon. “That will have a knock-on effect for corporate earnings. Higher rates and weaker earnings suggest more pain for stocks.”

    Monday: Germany Ifo business climate index

    Tuesday: US housing starts and building permits; China sets loan prime rate; Bank of Japan interest rate decision; earnings from General Mills, Nike, FedEx

    (FDX)
    and Blackberry

    (BB)

    Wednesday: US existing home sales; Germany consumer confidence; earnings from Rite Aid

    (RAD)
    , Carnival

    (CCL)
    , Cintas

    (CTAS)
    , Toro

    (TTC)
    and Micron

    Thursday: US weekly jobless claims; US Q3 GDP (third estimate); earnings from CarMax

    (KMX)
    and Paychex

    Friday: US personal income and spending; US PCE inflation; US new home sales; US durable goods orders; US U. of Michigan consumer sentiment; Japan inflation; UK markets close early

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  • Lighten Up: 5 Homes with Striking Light Fixtures – Sotheby´s International Realty | Blog

    Lighten Up: 5 Homes with Striking Light Fixtures – Sotheby´s International Realty | Blog

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    Whether they illuminate a traditional townhouse in Southampton or a chic contemporary residence in Southern California, distinctive light fixtures make each of these homes shine.

    Woolworth Tower Aerie

     Stan Ponte, Joshua Judge | Sotheby’s International Realty – East Side Manhattan Brokerage

    Towering above the city in the illustrious, amenity-rich Woolworth Building, this 2,548-square-foot condominium residence features sophisticated living and entertaining areas, two generous bedroom suites, and exposures in three directions offering sweeping views of the Hudson River and the city skyline. Its centerpiece is an open living and dining room with handsome herringbone floors, a bar, and one of multiple eye-catching modern light fixtures. This space flows to a light-filled kitchen with marble countertops, Dornbracht fixtures, and Miele appliances that include a wine chiller.

    Chic Houston Haven

    Kelley Austin | Martha Turner Sotheby’s International Realty

    Ideal for the entertainer, this striking new home on a prime corner lot exemplifies chic modern design. Its 4,906-square-foot two-level floor plan features engineered French oak floors throughout the study, elegant dining room, family room, chef’s kitchen, primary suite, and three guest bedrooms—all introduced by an entryway with two unique wine vaults and a dramatic globe-like light fixture. The spacious grounds offer a covered Trex deck with an outdoor kitchen that includes a grill, a refrigerator, a sink, and storage.

    Cutting-Edge Contemporary

    Robin Walpert | Sotheby’s International Realty – Santa Monica – Venice Brokerage

    A stunning example of quintessential contemporary design, this new solar-powered five-bedroom was designed for a luxurious environmentally friendly lifestyle. No expense was spared in its creation and outfitting, with a host of superior-quality fixtures that include dazzling glass light fixtures in the double-height living room as well as the adjoining dining area and chef’s kitchen. The serene backyard boasts a pool and spa, a gas fire pit, an outdoor kitchen, a synthetic turf lawn, and drought-tolerant landscaping with a drip irrigation system.

    Polo Club Townhouse

    Holly Hodder | Sotheby’s International Realty – Southampton Brokerage

    This 3,450-square-foot three-level home is a rare find in Southampton Village’s famed Polo Club. In addition to four bedroom suites, it offers a well-equipped kitchen with stainless-steel appliances, a finished lower level with a den or media room, and open living and dining spaces that respect both traditional and modern styles and feature bright, distinctive light fixtures. The main level opens to a charming backyard with a bluestone patio and colorful gardens.

    Los Angeles Oasis

    Marc Noah | Sotheby’s International Realty – Beverly Hills Brokerage

    Recently remodeled, this 7,070-square-foot villa is an inviting oasis in one of the most desirable neighborhoods in Los Angeles. Highlights include a formal living room; a great room with soaring ceilings; a kitchen with Sub-Zero appliances, an island, and a butler’s pantry; an office; four bedroom suites; a theater and game room with a wet bar; and a saltwater pool accompanied by a spacious terrace and an outdoor kitchen. Linking the multiple levels is a dramatic staircase with three captivating round light fixtures.

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

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    Melissa Couch

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  • Rooftop solar: How homeowners should do the math on the climate change investment

    Rooftop solar: How homeowners should do the math on the climate change investment

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    Solar panels create electricity on the roof of a house in Rockport, Massachusetts, U.S., June 6, 2022. Picture taken with a drone. 

    Brian Snyder | Reuters

    When Josh Hurwitz decided to put solar power on his Connecticut house, he had three big reasons: To cut his carbon footprint, to eventually store electricity in a solar-powered battery in case of blackouts, and – crucially – to save money.

    Now he’s on track to pay for his system in six years, then save tens of thousands of dollars in the 15 years after that, while giving himself a hedge against utility-rate inflation. It’s working so well, he’s preparing to add a Tesla-made battery to let him store the power he makes. Central to the deal: Tax credits and other benefits from both the state of Connecticut and from Washington, D.C., he says.

    “You have to make the money work,” Hurwitz said. “You can have the best of intentions, but if the numbers don’t work it doesn’t make sense to do it.” 

    Hurwitz’s experience points up one benefit of the Inflation Reduction Act that passed in August: Its extension and expansion of tax credits to promote the spread of home-based solar power systems. Adoption is expected to grow 26 percent faster because of the law, which extends tax credits that had been set to expire by 2024 through 2035, says a report by Wood Mackenzie and the Solar Energy Industry Association. 

    Those credits will cover 30 percent of the cost of the system – and, for the first time, there’s a 30 percent credit for batteries that can store newly-produced power for use when it’s needed.

    “The main thing the law does is give the industry, and consumers, assurance that the tax credits will be there today, tomorrow and for the next 10 years,” said Warren Leon, executive director of the Clean Energy States Alliance, a bipartisan coalition of state government energy agencies. “Rooftop solar is still expensive enough to require some subsidies.”

    California’s solar energy net metering decision

    Certainty has been the thing that’s hard to come by in solar, where frequent policy changes make the market a “solar coaster,” as one industry executive put it. Just as the expanded federal tax credits were taking effect, California on Dec. 15 slashed another big incentive allowing homeowners to sell excess solar energy generated by their systems back to the grid at attractive rates, scrambling the math anew in the largest U.S. state and its biggest solar-power market — though the changes do not take effect until next April.

    Put the state and federal changes together, and Wood Mackenzie thinks the California solar market will actually shrink sharply in 2024, down by as much as 39%. Before the Inflation Reduction Act incentives were factored in, the consulting firm forecast a 50% drop with the California policy shift. Residential solar is coming off a historic quarter, with 1.57 GW installed, a 43% increase year over year, and California a little over one-third of the total, according to Wood Mackenzie.

    For potential switchers, tax credits can quickly recover part of the up-front cost of going green. Hurwitz took the federal tax credit for his system when he installed it in 2020, and is preparing to add a battery now that it, too, comes with tax credits. Some contractors offer deals where they absorb the upfront cost – and claim the credit – in exchange for agreements to lease back the system. 

    Combined with savings on power homeowners don’t  buy from utilities, the tax credits can make rooftop solar systems pay for themselves within as little as five years – and save $25,000 or more, after recovering the initial investment, within two decades.  

    “Will this growth have legs? Absolutely,” said Veronica Zhang, portfolio manager of the Van Eck Environmental Sustainability Fund, a green fund not exclusively focused on solar. “With utility rates going up, it’s a good time to move if you were thinking about it in the first place.”

    How to calculate installation costs and benefits

    Here is how the numbers work.

    Nationally, the cost for solar in 2022 ranges from $16,870 to $23,170, after the tax credit, for a 10-kilowatt system, the size for which quotes are sought most often on EnergySage, a Boston-based quote-comparison site for solar panels and batteries. Most households can use a system of six or seven kilowatts, EnergySage spokesman Nick Liberati said. A 10-12 kilowatt battery costs about $13,000 more, he added.

    There’s a significant variation in those numbers by region, and by the size and other factors specific to the house, EnergySage CEO Vikram Aggarwal said. In New Jersey, for example, a 7-kilowatt system costs on average $20,510 before the credit and $15,177 after it. In Houston, it’s about $1,000 less. In Chicago, that system is close to $2,000 more than in New Jersey. A more robust 10-kilowatt system costs more than $31,000 before the credit around Chicago, but $26,500 in Tampa, Fla. All of these average prices are as quoted by EnergySage. 

    The effectiveness of the system may also vary because of things specific to the house, including the placement of trees on or near the property, as we found out when we asked EnergySage’s online bid-solicitation system to look at specific homes.

    The bids for one suburban Chicago house ranged as low as $19,096 after the federal credit and as high as $30,676.

    Offsetting those costs are electricity savings and state tax breaks that recover the cost of the system in as little as 4.5 years, according to the bids. Contractors claimed that power savings and state incentives could save as much as another $27,625 over 20 years, on top of the capital cost.

    Alternatively, consumers can finance the system but still own it themselves – we were quoted interest rates of 2.99 to 8.99 percent. That eliminates consumers’ up-front cost, but cuts into the savings as some of the avoided utility costs go to pay off interest, Aggarwal said. 

    The key to maximizing savings is to know the specific regulations in your state – and get help understanding often-complex contracts, said Hurwitz, who is a physician.

    Energy storage and excess power

    Some states have more generous subsidies than others, and more pro-consumer rules mandating that utilities pay higher prices for excess power that home solar systems create during peak production hours, or even extract from homeowners’ batteries.

    California had among the most generous rules of all until this week. But state utility regulators agreed to let utilities pay much less for excess power they are required to buy, after power companies argued that the rates were too high, and raised power prices for other customers.

    Wood Mackenzie said the details of California’s decision made it look less onerous than the firm had expected. EnergySage says the payback period for California systems without a battery will be 10 years instead of six after the new rules take effect in April. Savings in the years afterward will be about 60 percent less, the company estimates. Systems with a battery, which pay for themselves after 10 years, will be little affected because their owners keep most of their excess power instead of selling it to the utility, according to EnergySage. 

    “The new [California rules] certainly elongate current payback periods for solar and solar-plus-storage, but not by as much as the previous proposal,” Wood Mackenzie said in the Dec. 16 report. “By 2024, the real impacts of the IRA will begin to come to fruition.”

    The more expensive power is from a local utility, the more sense home solar will make. And some contractors will back claims about power savings with agreements to pay part of your utility bill if the systems don’t produce as much energy as promised. 

    “You have to do your homework before you sign,” Hurwitz said. “But energy costs always go up. That’s another hidden incentive.”

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  • How to Use Virtual Tours To Elevate Real Estate Sales

    How to Use Virtual Tours To Elevate Real Estate Sales

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    Opinions expressed by Entrepreneur contributors are their own.

    We’re in the last month of 2022, and not only are we entering a new year, but we’re entering a recession that’s hurting real estate sales across the country. As many other authors and I discussed in previous articles, virtual tours help real estate agents sell more properties, but that’s not up for debate.

    But we’ve found a neat little hack you can do with your real estate content to get free exposure and more eyeballs on your listings to get more sales. It’s all through a process called “geotagging.”

    Never heard of this term before? Don’t worry; let’s learn about how to implement it into your content.

    What is geotagging?

    Geotagging is a technical search engine optimization term used to help rank local content higher on search engines through the exact coordinates of a real estate listing and the type of real estate property. Many business owners implement this strategy to get them to rank higher on local searches; let’s walk through an example.

    John Smith owns a bakery in Philadelphia, and while he has a great virtual tour, video and photos, he’s looking for that extra edge against his competition. He finds the process of geotagging, goes to a free site such as geoimgr.com, finds the coordinates (longitude and latitude) of Philadelphia, adds it to Geo Imgr and then adds in his niche keyphrase for what people search for his type of business, such as “bakeries near me” or “bakeries in Philadelphia.”

    So you’re essentially telling Google what you do “niche” in your area’s coordinates, so Google positions you as such because you’ve organized your content and tagged it as such; it’s a brilliant way to get higher rankings on local searches. In 2023, you’ll need to think outside the box — this is a great example of doing just that.

    Related: How Real Estate Investors Can Prepare for 2023 in 4 Easy Steps

    How does this apply to real estate listings?

    What do brick-and-mortar businesses and real estate listings have in common? They’re both pieces of real estate, so this process works just as well with real estate listings, just like how it does with small businesses such as John Smith’s bakery.

    No one is doing this as a real estate agent. They’re only focused on having great content, although essential to get to the next level; they also need to geotag all of their photos and videos! This is what hotshot realtors do to increase exposure on their listings.

    So how do I optimize my content as a real estate agent?

    It’s easier than you think, so don’t overthink it! Here’s a quick step-by-step guide on how to geotag your real estate content.

    1. Go to Geoimgr.com
    2. Take your current listing content (photos, videos, renderings, 360 tours) and plug them into the groomer.
    3. Google your location coordinates, ex: Philadelphia’s coordinates are (39.9526° N and 75.1652° W).
    4. Enter the coordinates into Geoimgr.
    5. Enter your type of real estate into Geoimgr “single-family home in Rittenhouse (insert your neighborhood)” or “multifamily home south Philadelphia.”
    6. Hit the “EXIF Tag” button, and you’ve optimized your real estate listing content!

    Related: How Virtual Reality is Impacting Real Estate?

    Where do I post my optimized content once I have it?

    Like you would normally do, you’ll post to the multiple listing service, which posts to all the big-name listings such as Zillow, Realtor, Loopnet, Redfin, etc. Since most people search on Google anyway, Google will still give you the benefits of geotagging. The best part about using geoimgr is that you can upgrade your account to get more content optimized for more listings as you become more successful as time goes on.

    Don’t have the time? Fortunately, this process takes less than 10-15 minutes to complete. Learn how to do this process first, then give it to one of your teammates or interns to geotag your content for the foreseeable future.

    Virtual tours are the best marketing tool for your listing, but geotagging is the secret sauce that allows your listings to sell faster and for more money.

    Use this strategy to kickstart your 2023 and find success in your real estate endeavors.

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    Sean Boyle

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  • Luxury Real Estate Headlines: Third week in December 2022 – Sotheby´s International Realty | Blog

    Luxury Real Estate Headlines: Third week in December 2022 – 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.

    Hudson, New York | Four Seasons Sotheby’s International Realty

    Located just a short drive from New York City, the revamped historic home offers a harmonious blend of old and new.

    A Charming Hudson Valley Farmhouse Dating Back to 1810 Seeks $995KDwell

    Hamish Bowles Lists Greenwich Village Apartment for $2.9 MillionArchitectural Digest

    A Thomas Schoos-Designed Condo, Hits The Market For $17 MillionForbes

    Supermodel Alessandra Ambrosio Parts Ways with Her Bright NYC Duplex PenthouseCottages & Gardens

    Hot property: five homes for sale that offer December sunFinancial Times

    An Utterly Private 43-Acre Compound in Wyoming’s Jackson Hole ValleyMansion Global

    Inside a Unique Farmhouse-Turned-Residence in Bavaria Built in 1560 and Listed for $3.1MCottages & Gardens

    The Latest Must-Have Kitchen Staple: A PantryWall Street Journal

    The Most Expensive Condo for Sale in Austin Is Now This $17 Million Aerie – Mansion Global

    $880,000 Homes in Georgia, Massachusetts and OregonNew York Times

    Property: 9 dream homes to put on your Christmas wish listYahoo! Finance

    Winter sun retreats around the worldThe Week

    Priciest Wine-Country Real Estate in the U.S.? You Won’t Find It in NapaWall Street Journal

    $2.2M Modernist Dwelling From the Atomic Age a Rare Treat in the Nation’s CapitalRealtor

    $1.3 Million Homes in CaliforniaNew York Times

    Wolfeboro, New Hampshire, Is an Upscale Lake Town With Colonial OriginsMansion Global

    Retired Racer’s Magnificent Mountaintop Mansion Roars Onto the Market for $24.8MRealtor

    Tuscan Farmhouse on Florida’s Gulf Coast Lists for Nearly $14 MillionMansion Global

    Homes for Sale in New York and New JerseyNew York Times

    Brussels buyers find charming houses and relative affordabilityFinancial Times

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    Melissa Couch

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  • 6 Effective Real Estate Investment Strategies

    6 Effective Real Estate Investment Strategies

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    Opinions expressed by Entrepreneur contributors are their own.

    As a real estate investor, you might encounter varying advice about investing on the internet, social media and from other investors. Some of these sources may claim they know best, but there are many effective strategies for investing in real estate. There isn’t a single strategy that is the best approach for every landlord. In fact, your real estate investing strategy should reflect your personal long-term goals, available resources and current circumstances.

    Plus, your investing strategy can — and should — change as your needs change. The success of your rentals isn’t tied to one investing strategy, but rather the skills you’ve built, the tactics you’ve learned and your ability to shift between different strategies when needed.

    Below are six great real estate investing strategies you may use at various points in your investing career:

    Related: Master These 6 Skills to Succeed as a Real Estate Investor

    1. House hacking

    House hacking is a popular investing strategy wherein you buy a property, live in half and rent the other half out. The rental income you receive helps reduce your monthly mortgage payments on the property.

    This strategy works well with duplexes and other multiplexes because you can maintain a clear division between your and your tenant’s spaces. However, some investors also rent out a basement or bedroom from their single-family home (SFH).

    House hacking is a trendy and widely used investing strategy for several reasons. For one, it’s an excellent way to transition to real estate investing for new landlords. This is especially true if you learn to manage your rented unit or bedroom with property management software. Software helps you carefully track your income and expenses while you establish your business. Another benefit of house hacking is that it allows you to get a residential mortgage because you’ll be living on the property as well.

    In the long run, this strategy’s aim is to make it possible for you to move out and transition the property into a full-blown rental.

    2. BRRRR deal

    BRRRR investing is another effective strategy made popular by Brandon Turner on Bigger Pockets. BRRRR stands for buy, rehab, rent, refinance and repeat:

    • Buy: Buy a property at below-market value.

    • Rehab: Renovate and improve the property by adding value.

    • Rent: Rent out the property to cover the mortgage.

    • Refinance: Get the property reappraised, then use cash-out refinancing to secure an advantageous mortgage.

    • Repeat: Use the capital you recovered from the deal to invest in more properties.

    With BRRRR, the idea is to capitalize on a property others may have overlooked due to its low face value or apparent lack of potential.

    To use the BRRRR strategy, target properties that are sound investments despite needing some work. Focus on improvements that increase value: installing hardwood flooring, adding extra bedrooms or remodeling kitchens and bathrooms. The value added from these improvements will improve your property appraisal and help you secure more funds to invest elsewhere.

    Related: 5 Tips for New Investors Who Want to Make Money With Real Estate

    3. Wholesaling/driving for dollars

    Wholesaling is a strategy many investors use to capitalize on great deals. In this strategy, you find a property that will make a good deal, facilitate a sale between a buyer and seller, and then collect the difference between the seller’s price and the amount the buyer pays.

    To succeed with this strategy, you need to be informed about which properties are currently on the market. You can use popular listing sites, the Multiple Listing Service (MLS) or a strategy known as “driving for dollars.” This involves manually searching neighborhoods for properties that look promising.

    One downside of wholesaling is that you need strong marketing and sales skills. If you don’t have this skill set and don’t want to work to acquire it, wholesaling might not be for you.

    4. Flipping properties

    Flipping properties is like BRRRR in that you buy, renovate and improve a property. However, with house flipping, the end goal is to sell the property, not rent it out.

    House flipping works best when you renovate and flip as quickly as possible. The longer you wait to sell, the more mortgage payments you must make. Like BRRRR, house flipping works best with properties listed at below-market value or those that are easy to improve at low costs. This way, improvements can significantly increase the property’s value and lead to quick turnovers.

    One downside to this strategy is that you’ll have higher capital gains taxes because you sold the property so quickly. You’ll also need help to successfully pull off house flipping — specifically, you’ll need a team of builders and renovators and access to high-quality materials at a relatively low cost.

    5. Syndications

    Syndication is often considered a more passive real estate investing strategy. However, with careful decision-making and an active eye on the process, syndication can lead to great gains. The main idea with the syndication strategy is to pool your funds with other accredited investors to buy real estate.

    Here’s how it works: You pay syndicators to locate and manage most deals, then benefit from the profit. Syndication can be public or private. Public syndication is usually operationalized through a syndication marketplace, while private syndication is managed manually by investors.

    Crowdfunding is a specific type of syndication investing that involves accredited and non-accredited investors alike who contribute and profit from deals. If you choose the crowdfunding path, you’ll work with a broader range of investors. You also won’t be expected to contribute as much entry capital as you would with traditional syndication (typically only around $50-$1,000 is required).

    If you choose the syndication route, be picky about who you work with. You want to ensure your investments are in good hands, even if you didn’t contribute as much initially.

    Related: 7 Common Mistakes Made By New Real Estate Investors

    6. Live-in-then-rent

    The live-in-then-rent strategy is a modified house-flipping scenario. Essentially, your property is a SFH (usually) that you live in initially and then turn into a rental after you move out. The main difference between live-in-then-rent and house hacking is that you don’t live in the property and rent it at the same time. Instead, these are two separate phases.

    Live-in-then-rent is a great strategy for people who don’t want to live closely with their renters but still want to participate in real estate investing on their budget.

    With so many ways to invest in real estate, it may seem challenging to devise a strategy that meets all your needs. However, by catering your investing strategy to your particular goals, you can successfully cultivate your real estate business.

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    Dave Spooner

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  • The Grinch comes for retailers | CNN Business

    The Grinch comes for retailers | CNN Business

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    A version of this story first appeared in CNN Business’ Before the Bell newsletter. Not a subscriber? You can sign up right here. You can listen to an audio version of the newsletter by clicking the same link.


    New York
    CNN
     — 

    Weaker-than-expected retail sales in November pummeled market sentiment on Thursday and raised the odds that the Federal Reserve’s inflation-fighting interest rate hikes would push the economy into recession.

    What’s happening: US retail sales, which measure the total amount of money that stores make from selling goods to customers, fell 0.6% in November, the weakest performance in nearly a year. The drop concerned economists who had expected monthly sales to shrink by just 0.1%. It’s also a sharp reversal from October’s sales increase of 1.3%.

    That’s a bad sign for the economy. Just last month Bank of America CEO Brian Moynihan told CNN that the continued strength of the US consumer is nearly single-handedly staving off recession. Consumer spending is a major driver of the economy, and the last two months of the year can account for about 20% of total retail sales — even more for some retailers, according to National Retail Federation data.

    Market mania: The weak report means that spending faltered just as the holiday season started, a critical time for retailers to ramp up profits and get rid of excess inventory. Investors weren’t too happy about that.

    Shares of Costco

    (COST)
    closed Thursday 4.1% lower, Target

    (CBDY)
    fell by 3.2%, Macy’s

    (M)
    dropped 3.5% and Abercrombie & Fitch

    (ANF)
    was down 6.2%.

    The entire sector took a blow — the VanEck Retail ETF, with Amazon

    (AMZN)
    , Home Depot

    (HD)
    and Walmart

    (WMT)
    as its top three holdings, fell by 2.2%. The SPDR S&P Retail ETF, which follows all S&P retail stocks, was down 2.9%.

    Weak sales are likely to continue, say analysts, and if they do, then retailers’ bottom lines and fourth-quarter earnings will suffer.

    “The headwinds of the past year are catching up to consumers and forcing them to be more conservative in their holiday shopping this winter,” warned Morgan Stanley economist Ellen Zentner in a note.

    The Fed factor: November’s report could indicate that consumers are feeling the double-punch of sky-high inflation and painful interest rate hikes from the central bank. This retail sales data adds to recessionary concerns, as it suggests that consumers may be becoming more cautious with their spending.

    “Households are increasingly relying on their savings to sustain their spending, and many families are resorting to credit to offset the burden of high prices. These trends are unsustainable, and the current credit splurge is a true risk, especially for families at the lower end of the income spectrum,” said Gregory Daco and Lydia Boussour, economists at EY Parthenon.

    While American bank accounts are still fairly robust, they’re beginning to dwindle. In the third quarter of 2022, credit card balances jumped 15% year over year. That’s the largest annual jump since the New York Fed began keeping track of the data in 2004.

    “Against this backdrop, we expect consumers will rein in their spending further in coming months,” said Daco and Boussour. “Real consumer spending should see modest growth in the final quarter of the year, but we expect it will barely grow in 2023.”

    Bottom line: If Bank of America’s Moynihan was right, the US economy is in trouble.

    US mortgage rates came in lower once again this week, marking the fifth consecutive drop in a row.

    The 30-year fixed-rate mortgage averaged 6.31% in the week ending December 15, down from 6.33% the week before, according to Freddie Mac. A year ago, the 30-year fixed rate was 3.12%, reports my colleague Anna Bahney.

    That’s a sharp reversal from the upward trend in rates we’ve seen for most of 2022. Those increases were spurred by the Federal Reserve’s unprecedented campaign of harsh interest rate hikes to tame soaring inflation. But mortgage rates have tumbled in the last several weeks, following data that showed inflation may have finally reached its peak.

    The Fed announced on Wednesday that it will continue to raise interest rates — albeit by a smaller amount than it has been.

    “Mortgage rates continued their downward trajectory this week, as softer inflation data and a modest shift in the Federal Reserve’s monetary policy reverberated through the economy,” said Sam Khater, Freddie Mac’s chief economist.

    “The good news for the housing market is that recent declines in rates have led to a stabilization in purchase demand,” he added. “The bad news is that demand remains very weak in the face of affordability hurdles that are still quite high.”

    American regulators have been granted unprecedented access to the full audits of Chinese companies like Alibaba

    (BABA)
    and JD.com

    (JD)
    after threatening to kick the tech giants off US stock exchanges if they did not receive the data.

    The announcement marks a major breakthrough in a yearslong standoff over how Chinese companies listed on Wall Street should be regulated. It will come as a huge relief for these firms and investors who have invested billions of dollars in them, reports my colleague Laura He.

    “For the first time in history, we are able to perform full and thorough inspections and investigations to root out potential problems and hold firms accountable to fix them,” Erica Williams, chair of the Public Company Accounting Oversight Board, said in a statement Thursday, adding that such access was “historic and unprecedented.”

    More than 100 Chinese companies had been identified by the US securities regulator as facing delisting in 2024 if they did not hand over the audits of their financial statements.

    On Friday, China’s securities regulator said it’s looking forward to working with US officials to continue promoting future audit supervision of companies listed in the United States.

    There are more than 260 Chinese companies listed on US stock exchanges, with a combined market capitalization of more than $770 billion, according to recent calculations posted by the US-China Economic and Security Review Commission.

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  • ‘This is a war’: Californians seek affordable housing alternatives | CNN Business

    ‘This is a war’: Californians seek affordable housing alternatives | CNN Business

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    Los Angeles
    CNN
     — 

    At 26, Ixchel Hernandez has become the defender and protector of her family’s modest apartment. In the two decades they’ve lived in their Los Angeles home, the family of four has successfully fought against multiple attempts aimed at pricing and, ultimately, forcing them out.

    “We are human beings with the right to live in our home, and that’s just frankly what every person… in every home and [in] every building should know … they have the right to have their own space, to have their home,” Hernandez said.

    But, across the country, affordable housing is becoming increasingly rare to find. The lack of housing inventory coupled with inflation and zoning inequalities have priced out most families, especially those who start with little-to-no capital of their own.

    Ixchel’s parents moved to the United States from Mexico in hopes of giving her and her brother opportunities and a safe environment. Her father, Jose Hernandez, never wanted to give the family’s various landlords a reason to evict them over the years, and he dreamed of owning his own home one day.

    “Thank God we never failed to pay our rent,” he said. But in order to keep up with rising rents, both parents worked and even opened up their home to another family for a brief time. Ixchel remembers six people crammed into their one-bedroom apartment.

    “It shouldn’t have to be that way where you’re kind of fighting for space or you’re going to have to move so far out of LA to be able to have a home,” she said.

    To purchase a house in more than 75% of the nation’s most populous cities, an average family needs to spend at least 30% of their annual income on housing. In cities like Miami, New York and Los Angeles, that number surges to more than 80% of an average family’s annual income.

    Home ownership for the Hernandez family, and so many others, has felt like a fading American dream. That is until they discovered a Civil Rights era approach that helps promote home ownership, particularly among minority groups, who are disproportionately impacted by the affordable housing crisis. It’s called a Community Land Trust, or CLT.

    The Hernandez family at their home.

    “We’re operated by residents who actually live in our building… [as well as] folks from the communities that we’re serving,” said Kasey Ventura of the Beverly-Vermont Community Land Trust. “My interest in this work, outside of just preserving housing and affordable housing, is preserving culture in a community.”

    A CLT is essentially a nonprofit organization that buys the land on which a building sits, thereby allowing a community’s residents to collectively manage it. Some residents eventually choose to form a co-op with their neighbors and take ownership of their buildings, renting the land.

    The Hernandez family and their neighbors embraced the concept. This year they joined the Beverly-Vermont CLT, one of at least five in Los Angeles and more than 200 nationwide. The process requires neighbors to meet regularly over several months before ultimately unanimously agreeing on various terms so as to finalize the trust. Ixchel now sits on the board of her building’s management; it’s in the final stages of ownership transfer to the co-op.

    “What’s important is that we’re now owners!” said Ixchel’s mother, Guadalupe Santiago. “But it’s also important to remember it was not easy,” her father cautioned.

    “It may not seem like a lot to a lot of folks that have money or come from money,” Ixchel said. “[But] we are just as much trying to build that generational wealth.”

    According to 2019 figures, the United States was roughly 3.8 million homes short of what was needed to house families. That is more than double the number from a decade earlier. California has the largest housing deficit of any other state, requiring an estimated million more homes to meet housing demands.

    “We don’t necessarily view housing as a need that everybody should have. And that’s key… in this work,” said Kasey Ventura, who helps run the Beverly-Vermont Community Land Trust in Los Angeles.

    While CLTs are a solution, Ventura admits there are — and should be — other affordable housing options to adequately address the crisis.

    In Southern California, there is growing demand for construction and rental of ADUs, or Accessory Dwelling Units. Also called “carriage homes,” the converted garages or newly built smaller structures sit adjacent to existing homes and are on the same property. The mostly studio or one-bedroom apartments provide a more affordable option to many who prefer to live or work in areas that might otherwise be too expensive.

    Others have advocated for utilizing unoccupied homes. There are dozens of vacant houses, in some cases, sitting just a few blocks from several homeless encampments lining many Los Angeles sidewalks. However, efforts to transform them into affordable housing in some neighborhoods have proven controversial among existing homeowners.

    Another route undertaken by some companies is Employer-Assisted Housing. Although they have only finished a portion of what they initially pledged, in recent years corporations like Google, Meta and Apple have promised to spend billions of dollars on some 40,000 new homes in California. The initiative began in order to combat soaring home prices in the Bay Area, while also recruiting and retaining talent who needed more affordable housing options, along with a shorter commute to the office.

    “Just to be able to be like, ‘Okay, I’m gonna wake up, take a walk down the street and come to work.’ I mean that’s awesome!” said Matthew Johnson, an employee of Factory_OS in Vallejo, California, which already plans to provide workforce housing options to its workers in the coming years. However, unlike other companies, Factory_OS employees will build their own homes.

    In a space once used to build US Navy submarines during World War II, Larry Pace now operates Factory_OS outside San Francisco. He co-founded the company with Rick Holliday to address the worsening housing shortage.

    Matthew Johnson working at Factory_OS.

    “That we’ve repurposed a building that was once for instruments of war, [so as] to [now] create affordable and supportive housing…. I don’t know how much cooler that can be,” said Pace.

    Factory_OS puts homebuilding onto an assembly line and produces fully finished modular units within two weeks. From insulation and drywall to flooring, fixtures and paint, all of it is prefabricated within the confines of the factory before it’s trucked to a site for assembly.

    “We’ve created an IKEA for the manufacturing of homes,” said Pace. “Then we put the pieces together.”

    When hoisted by a crane and stacked like sophisticated Legos, the modular units combine to make entire apartment buildings. Pace maintains there are massive cost-savings and huge efficiencies in moving homebuilding into a factory setting compared with on-site construction.

    “We’re building houses for the people who need them, for the people who have been struggling to be able to support their families or pay rent or pay bills,” said Johnson, as he placed support beams for a roof of one of the units.

    The 38-year-old Factory_OS employee and father of five was once homeless, and he said he often thinks about the families who will one day live under the roof he’s assembling. w

    “Every morning I wake up, I’m grateful… that I come home from work and there are my kids waiting for me,” said Johnson.

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  • Black Travelers Less Likely to Have Airbnb Bookings Accepted

    Black Travelers Less Likely to Have Airbnb Bookings Accepted

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    Travelers who are perceived as Black have the widest gap in success in booking rentals on Airbnb compared to travelers seen as white, Airbnb said in a report on the company’s efforts to fight discrimination Tuesday.


    Carl Court I Getty Images

    “Unfortunately, discrimination happens daily in our world, which means it can happen on Airbnb, too,” the company wrote in the report.

    An author on the report, Laura Murphy, former director of the ACLU’s Washington office — who also completed civil rights audits for Facebook — said she appreciated Airbnb’s “tenacity” on the issue, as it is the third report of this type she has led or worked on for Airbnb.

    “I have seen far too many companies commit to meet a moment of injustice, only to see their dedication falter and funds dry up when the press coverage subsided and corporate priorities shifted,” Murphy wrote.

    In 2015, Harvard researchers found travelers whose names seemed to be African American were less likely to have bookings accepted by hosts. Travelers have also shared stories of experiences with discrimination on the platform using the hashtag #AirbnbWhileBlack.

    In the years since then, Airbnb has implemented features like not displaying someone’s profile picture until a booking is confirmed, which it rolled out in 2018. In Oregon, it is testing a feature that only shows a guest’s initials until a booking is confirmed to prevent name-based discrimination.

    But the report touched on some major divides among white, Black, Hispanic/Latino and Asian travelers. The company based the racial analysis on “the race someone might associate with a first name and profile photo.”

    In 2021, Black travelers had a 91.4% percent booking success rate — i.e., the number of times they were able to book the listing they requested. White travelers had a 94.1% success rate; Asian and Hispanic/Latino users both had a 93.4% success rate.

    Black and Hispanic/Latino customers are also less likely than white travelers to be left reviews by their hosts, according to the report. Because they have fewer reviews, they are less likely to qualify for the requirements to “instant book.”

    On Airbnb, a host can decide if they want to allow people to book a property whenever it’s available or if they want to manually approve every booking request.

    Hosts also decide who can instantly book their homes — i.e., if someone has a verified government ID or, crucially, some sort of review history.

    Airbnb said in the discrimination report it will continue to remove barriers to access to instant book, such as allowing hosts to let users who do not have prior reviews instantly book their properties.

    “Instant book is one of the most effective tools to increase the booking success rate across perceived racial groups. Because reservations made with instant book don’t require a review by the host before approval, bookings are more objective,” the company wrote.

    The report discussed other diversity and inclusion efforts, such as the November 2022 launch of its Adapted category. The company uses scans “conducted by leading spatial data company Matterport” to determine if rentals are actually accessible to those in wheelchairs. It launched the category with 1,000 listings, the company said in the report.

    The report added that “going forward” a portion of company executives’ pay “will be based on their teams’ respective diversity plans.” Airbnb cited the NAACP and Color Of Change as partners in the report.

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    Gabrielle Bienasz

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  • Zoning is a bigger headwind to housing than inventory, says Pulte Capital CEO Bill Pulte

    Zoning is a bigger headwind to housing than inventory, says Pulte Capital CEO Bill Pulte

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    Pulte Capital CEO Bill Pulte joins 'Closing Bell: Overtime' to discuss the housing industry as homebuilder stocks hold up.

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  • Mega-Billionaire Ken Griffin Has Moved His Masterpieces to the Beach

    Mega-Billionaire Ken Griffin Has Moved His Masterpieces to the Beach

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    In 2015, the hedge fund titan Kenneth C. Griffin became the first person to spend half a billion dollars on art in a single transaction. David Geffen made a deal with Griffin to sell him Willem de Kooning’s boldly colored abstract masterpiece Interchange for $300 million, and Jackson Pollock’s Number 17A—the splatter painting Life magazine plastered in its pages in 1949, minting Jack the Dripper an American celebrity—for $200 million. 

    Griffin could have scurried away with the masterpieces to one of his homes: a $238 million apartment at 220 Central Park West and a $120 million London mansion near Buckingham Palace, the most expensive apartment in Chicago history, getaways in Aspen and Hawaii, a large chunk of Miami’s Star Island. Instead he let them go on view at the Art Institute of Chicago, placing 20th-century masterworks next to the museum’s iconic impressionist and postimpressionist holdings.

    “My art collection is almost all at the Art Institute of Chicago, it’s been there for years,” Griffin said to David Rubenstein in March 2019, while appearing on his show Peer-to-Peer Conversations. “For me, the fact that 700,000 or a million people a year will have a chance to see some of the greatest works of art of our culture, that I’m fortunate enough to own? I have great satisfaction in that.”

    But at some point over the last few years, those two works, the Pollock and the de Kooning traded in the biggest art sale ever, were quietly taken down from the museum. Their whereabouts were unknown. 

    The Saturday after Art Basel, I took a Brightline train from Miami to Palm Beach to attend openings and cocktails parties that make up the New Wave Art Weekend. At one point I swung by the Norton, the West Palm Beach museum that houses the collection of Ralph Hubbard Norton, a 20th-century steel magnate from Chicago who summered in Florida. I had seen the permanent collection twice in the past two years and thought I knew it pretty well, but after walking out from a gallery of top-notch work by Georgia O’Keeffe, Stuart Davis, and Edward Hopper, I saw a work made the year Norton died, something I had presumed would have been well out of the museum’s acquisitions budget: Mark Rothko’s No. 2 (Blue, Red and Green) (Yellow, Red, Blue on Blue) (1953), which exploded the artist’s market when it sold at Sotheby’s in 2000 for $11 million, or about $30 million accounting for inflation. 

    As the wall text explained, it was at the Norton on loan from a private collection, after having been shown at the Art Institute of Chicago from October 2020 to June 2022. Also new was a peak Roy Lichtenstein masterwork, Ohhh…Alright… (1964), which set an artist record when it sold for $42.6 million at Christie’s, consigned by Steve Wynn, who bought it from Steve Martin. It too was shown at the Art Institute of Chicago, and belongs, the wall text said, to a private collection. And across the hall, an untitled Robert Ryman that was on the walls of the great Chicago museum as recently as 2017 was hanging at the Norton, thanks to a private collection. 

    Sources confirmed that all three came from Griffin. 

    And then, around a corner and installed with little to no ceremony, were two works very much in a private collection, but a collection that everyone knows: Interchange and Number 17A, owned by Griffin. 

    Without fanfare, at least a billion dollars of Griffin’s art departed the second-biggest encyclopedic institution in the country and ended up in Palm Beach. The Norton declined to comment when asked about the new works in its collection, as did the Art Institute, but Griffin provided a statement to True Colors on Thursday. 

    “The Norton is one of our country’s most significant and beautiful museums,” Griffin said. “I hope South Florida families, students and visitors will enjoy and be inspired by these pieces and the thousands of works of art from all over the world displayed at the museum.”

    Griffin was very public about moving Citadel, his hedge fund with over $50 billion in assets, to Miami earlier this year. The prodigal son of the sunshine state—Griffin’s a Boca Raton native and a graduate of Boca Raton Community High School—returned in after decades of support for Chicago, the city he lived in since graduating from Harvard in 1989 and immediately crushed it with his own fund. 

    In departing the Windy City, Griffin left behind the Illinois governor (and fellow billionaire) with whom he publicly feuded over raising taxes on the wealthy and what he claimed was a rising crime rate (JB Pritzker); a hedgie ex-wife who claimed in a yearlong divorce battle that she was forced to sign a prenup that only gave her a $1 million a year (Anne Dias-Griffin); and a gubernatorial candidate that Griffin bankrolled to the tune of $50 million only to see steamrolled in a Republican primary by a Trump-backed candidate (Richard Irvin)

    At the outset of the pandemic, Griffin rented out the entire Four Seasons in Palm Beach, parked off-duty cops outside, and restricted entry to anyone but his employees. He made Citadel’s move official in August, taking space in a building owned by fellow art-collecting billionaire Vlad Doronin, until a new HQ can be built. He’s spent weekends on Palm Beach, where he’s bought up sizable contiguous chunks of the south part of the island. 

    Griffin has also gone all in on Ron DeSantis, the Florida governor who, in his successful reelection campaign in November, became the first Republican in decades to carry the once-hard-blue Miami-Dade and Palm Beach counties. Griffin told Politico in a rare interview that his deep pockets would back the heir to MAGA-dom if he ran for president in 2024. Griffin’s already started to flex his political sway, in Florida and elsewhere. He donated more than $100 million to Republican candidates in 2022, and is very much over his next-door neighbor at Mar-a-Lago.

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    Nate Freeman

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  • Office space REITs concentrated in major markets will see big losses, says Don Peebles

    Office space REITs concentrated in major markets will see big losses, says Don Peebles

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    Don Peebles, The Peebles Corp. chairman and CEO, joins ‘The Exchange’ to discuss what investors should be watching out for in office REITs.

    05:26

    Thu, Dec 15 20222:17 PM EST

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  • Video of the Week: A Magnificent Estate in McLean, Virginia – Sotheby´s International Realty | Blog

    Video of the Week: A Magnificent Estate in McLean, Virginia – Sotheby´s International Realty | Blog

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    Featuring curated videos from the most sought-after destinations the world over, discover this  week’s Video of the Week.

    Chicago, Illinois | Mark LowhamTTR Sotheby’s International Realty

    Rugged granite cliffs and panoramic views of the Potomac River set the stage for this exceptional estate which has been described as one of the most beautiful homes on the East Coast. A private lane introduces the gated entrance which reveals the understated, French Provincial architecture of the residence. Timeless materials, including a Vermont Slate roof, copper gutters, and limestone and concrete stucco walls blend seamlessly into the breathtaking natural setting.

    Custom iron doors introduce guests to a circular rotunda with views to the river and beyond. Designed to capture sweeping views from literally every room, galleries extend both direction to the public rooms, including the main salon, dining room and soaring great room. Adjoining the great room, a world class kitchen by Lobkovitch with input from renowned chef, Jose Andres, captures every luxurious amenity, including a breakfast room with 180 degree views of the gardens, outdoor pool and the river. A separate catering kitchen provides a full suite of appliances to satisfy the most discerning host. Nearby, an office with unobstructed river views, a managers office, a full laundry room and coat room lead to the daily garage with parking for 4-6 cars.

    On the opposite end of this level, a spacious salon once again captures uncompromising views of the river to the west and leads to a collectors garage with room for 18-22 cars. This finely finished space also doubles as an exceptional ballroom space for large indoor gatherings. Upstairs, the primary suite encompasses the entire western wing of the 2nd floor and includes a perfectly scaled bedroom with a fireplace, a spa-quality bath, coffee bar, and a dramatic closet and dressing room. A private corridor leads to four additional bedrooms, all with beautifully detailed, en-suite baths and stunning views.

    The lower level of the residence introduced by two separate staircases was designed to surprise and delight. A games room adjoins a dramatic wine room with a quartz crystal wine cellar and wet bar. The nearby media room is pre-wired for electronic black-out shades and features dual retractable screens. Just beyond, an exercise suite captures sweeping views outdoors and overlooks the indoor basketball court outfitted with official NBA Spaulding Basketball hoops, professional flooring, and an exterior entrance. Just a few steps beyond, a sublime indoor swimming pool and spa are equipped with an LED lighting system, adjoining bath and shower, and a separate de-humidification system. An ADA compliant elevator services three levels of the residence, and a smart-house system by Savant controls Lutron lighting, music, HVAC systems, fireplaces, entrance gates, and security systems. A full-house generator, geothermal system for heating and air conditioning, and dual well and septic systems for water and sewer insure flawless operations throughout the estate.

    Outdoors, a covered veranda with built-in heaters, retractable screens, a firepit, and an outdoor kitchen overlook the expansive lawn and gardens. Designed for outdoor entertaining, the central lawn area was designed to accommodate a large tent for 200+ guests. Beyond, an infinity edge pool captures sunset views, and multiple terraces provide ideal vantage points for the truly spectacular views in all directions of the river, abundant wildlife, and the city of Washington beyond. Additional accommodations for guests or staff are provided in two separate quarters: a two-bedroom unit with a kitchen and separate entrance on the lower level, and an additional guest or staff quarters with a separate entrance located above the daily garage. The estates ideal location just 1.5 miles from the Capital Beltway and 10 minutes to Tysons Corner also provides easy access to both Ronald Reagan National Airport and Washington Dulles International Airport. Downtown Washington is less than 20 minutes. The Cliffs is unquestionably the finest new estate offering in Washington.

    Discover tours of luxury homes for sale around the world on our award-winning YouTube Channel

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    Melissa Couch

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  • Mortgage applications rose last week on lower rates

    Mortgage applications rose last week on lower rates

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    CNBC's Diana Olick reports on mortgage applications.

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  • Sotheby’s International Realty Expands in Washington – Sotheby´s International Realty | Blog

    Sotheby’s International Realty Expands in Washington – Sotheby´s International Realty | Blog

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    Sotheby’s International Realty today announced the opening of Vashon Island Sotheby’s International Realty, signifying the brand’s continued expansion in the United States and its seventh affiliated office in the state of Washington.

    The firm is owned and operated by Nicole Donnelly-MartinLinda Bianchi, and Richard Bianchi who bring a collective 85 years of real estate experience. The office will be managed by Glynis Delargy. Headquartered on Vashon Island, an island community nestled between Seattle and Tacoma in the southern part of Puget Sound, the company will service the surrounding area in addition to the Kitsap Peninsula and South Sound regions.

    “The luxury market on Vashon Island is seeing incredible growth,” said Philip White, president and CEO of Sotheby’s International Realty. “The area has seen a significant increase year-over-year in the over $2 million-dollar market, according to local market records. It also possesses the most waterfront footage of any area in King County, making it ideal for those looking to be surrounded by the natural splendor of the Pacific Northwest. Nicole and her team possess strong experience and I look forward to welcoming Vashon Island Sotheby’s International Realty to the network.”

    “Vashon Island Sotheby’s International Realty is a locally owned real estate brokerage focused on the exceptional representation of buyers and sellers on Vashon Island and the surrounding areas,” said Donnelly-Martin. “Local knowledge, combined with high-quality service and unmatched results, sets us apart. Our affiliation with Sotheby’s International Realty enables the homes we represent to also benefit from its renowned global marketing programs, worldwide exposure and exclusive access to a highly qualified global clientele.”

    The company is committed to supporting its local community with active involvement in the Vashon Schools Foundation, Vashon Rotary Club, and St. Vincent de Paul Society Vashon, an international non-profit organization whose mission is to serve the poor and underserved members of Vashon Island. Vashon Sotheby’s International Realty has also pledged a minimum of 1% of its profits to organizations that support its neighbors and local environment.

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    Melissa Couch

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  • Musk’s Twitter reportedly hasn’t paid rent on its office spaces for weeks

    Musk’s Twitter reportedly hasn’t paid rent on its office spaces for weeks

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    Pedestrians walk in front of the Twitter Inc. headquarters in San Francisco, California.

    David Paul Morris | Bloomberg | Getty Images

    In an effort to cut costs following Elon Musk’s chaotic $44 billion acquisition of Twitter, the social media company has stopped paying rent, according to a report from The New York Times.

    Twitter has not paid rent for its global offices or San Francisco headquarters in weeks, the report said, as Musk’s team has been trying to renegotiate the terms of the company’s lease. As a result, Twitter has received complaints from real estate firms like Shorenstein, which owns Twitter’s San Francisco buildings.

    Representatives for Shorenstein and Musk did not immediately respond to requests for comment. Twitter no longer has a communications department.

    Musk said Twitter suffered a “massive drop in revenue” in the days following his $44 billion acquisition of the company. Without providing any figures or evidence, he claimed in a tweet that the revenue drop was the result of activist groups putting pressure on advertisers.

    Though many companies did pause advertising on Twitter, some major advertising giants like Apple and Amazon have resumed spending on the platform.

    Musk has also revamped Twitter’s subscription service, Twitter Blue, with the hope of generating fresh revenue for the company. The service launched Monday after Musk pulled and delayed the launch in November.

    Twitter Blue costs $8 a month for web users and $11 a month for iOS users who purchase it through Apple‘s App Store. The $3 iOS price difference reflects Musk’s recent gripes about Apple’s 30% cut of all digital sales made through apps.

    Subscribers with a verified phone number will receive a blue checkmark once their account is reviewed and approved, Twitter said in a tweet Saturday. Blue users will also be able to edit tweets and get early access to new features. The company says Blue subscribers will “soon” see fewer ads, have the option to post longer videos and will appear at the top of replies and mentions.

    Musk has been a vocal critic of Twitter’s previous system, which granted verification to notable users like politicians, executives, members of the press and organizations to signal their legitimacy. He said the new verification system will be “the great leveler” and give “power to the people.

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  • Inside a Contemporary Tour de Force in Los Angeles – Sotheby´s International Realty | Blog

    Inside a Contemporary Tour de Force in Los Angeles – Sotheby´s International Realty | Blog

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    The list of accolades for Monika Haefelfinger and Scott Utterstrom’s firm XTEN Architecture runs into the dozens. The acclaimed international company based in Los Angeles and Switzerland specializes in custom contemporary constructions that combine the notorious precision of the Swiss with California’s progressive, experimental spirit. Soaring above the city of Los Angeles with the majestic Pacific Ocean in the distance, this striking residence is among XTEN’s award winners—a standing that, with its generous use of glass, crisp clean lines, unique fluid layout, and emphasis on the view—it rightly deserves.

    Los Angeles, California | Bruno Abisror, Joseph CilicSotheby’s International Realty – Santa Monica – Venice Brokerage

    The home’s position, following the contours of its hillside, creates a feeling of being integrated with its natural surroundings, and some 44 floor-to-ceiling sliding glass panels thoughtfully positioned throughout the home blur the lines between indoors and out, capturing the prevailing breezes and “disappearing” to establish an effortless flow between serene interiors and captivating alfresco areas with dazzling outlooks.

    Outdoor living shares top billing here. A spacious yard, numerous decks, a trio of burbling water features, a fire pit, and an infinity-edge waterfall accompany the home, offering a variety of venues for outdoor lounging, dining, and entertaining with one of the city’s most enviable vistas as a backdrop. When illuminated at night, the waters of the alluring swimming pool and spa echo the entrancing blues of the sky overhead.

    The open, expansive living room has two focal points: a striking sculptural indoor-outdoor fireplace and a magnificent view. A dining area adjoins a kitchen with streamlined surfaces of wood and stone and a secluded breakfast patio. A casual living area gives way seamlessly to a stone and grass terrace set into the earth and enveloped by trees and hedges for consummate privacy. Honey-hued hardwood floors flow throughout.

    The carefully cantilevered charcoal-hued concrete staircase rises to the upper level and its two guest suites as well as an inspiring primary suite with a similarly eye-catching fireplace, a well-outfitted walk-in closet, and a glass-railed balcony. The resort-caliber bath boasts a soaking tub and a mirrored dual-vanity wall. Fittingly for a residence in the city widely regarded as the home of cinema, a full wall of glass offers a sparkling, theatrical view.

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

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    Melissa Couch

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  • Vanguard sees a recession in 2023 — and one ‘silver lining’ for investors

    Vanguard sees a recession in 2023 — and one ‘silver lining’ for investors

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    The last 12 months was a year of fast-rising inflation, fast-rising interest rates and fast-rising questions about a future recession.

    Prices went up while stock markets and savings account balances went down, leaving consumers and investors dizzy and their wallets hurting.

    There may be more financial pain, that’s pretty sure — but it might not be as bad as feared, according to Vanguard’s look ahead to 2023.

    The likely recession will not send jobless rates charging sharply higher, sticker shock will fade for the price of goods, and the rise in rent and mortgages will also ease, Vanguard said.

    On Tuesday, inflation data for November showed prices are continuing to cool. Analysts say that makes a 50-basis point increase, rather than a 75-basis-point increase, more likely.

    The good news: This opens up chances for stocks to rebound, the asset-manager added.

    The outlook, released this week, comes as Americans are trying to guess what 2023 holds for their finances while they manage their holiday shopping budgets, and 2022 investments.

    On Tuesday, inflation data for November showed prices are continuing to cool. From October to November, the cost of living nudged up 0.1%, lower than the 0.3% forecast, the Consumer Price Index showed. Year over year, the inflation rate receded to 7.1% from 7.7% in October, according to the CPI data.

    On Wednesday, the Federal Reserve will announce its latest decision on interest rate increases. A 50-basis point increase is widely expected after four jumbo-sized 75-basis point hikes from the central bank.

    Here’s one roadmap for what’s next, as far as Vanguard’s researchers and experts can see.

    Hot inflation will cool

    Inflation rates during 2022 climbed to four-decade highs. There have been signs of easing, such as smaller-than-expected price increases in October.

    “As we step into 2023, early signs of a recovery in goods supply and softening demand could help balance supply and demand for consumption goods and bring prices lower,” the authors noted ahead of Tuesday’s CPI numbers.

    But the cost and demand of services are going to prevent a quick fall, they noted. Signs of slowing price increases are already emerging in rents and mortgages, but they will take longer to ease than prices of consumer goods, the authors said.

    That echoes the view from Treasury Secretary Janet Yellen, who said Sunday there will be “much lower inflation,” absent any unanticipated shocks to the economy.

    But while hot inflation will cool, it will still be warm to the touch. The Fed says 2% inflation is its target goal; Vanguard sees 3% inflation by the end of 2023.

    A recession is very much on the cards

    As “generationally high inflation” slowed economies across the world, the Fed and other central banks have countered with interest-rate increases to tame price increases. That “will ultimately succeed, but at a cost of a global recession in 2023,” according to Vanguard’s report. Vanguard sees a 90% chance of a recession in the United States by the end of next year.

    Vanguard is hardly alone in the recession call, so the question is how bad could the big picture look?

    In Vanguard’s view, it’s not so bad. “Households, businesses, and financial institutions are in a much better position to handle the eventual downturn, such that drawing parallels with the 1970s, 1980s, 2008, or 2020 seems misplaced,” the authors wrote.

    Job losses may be clustered

    For now, the jobless rate in a tight labor market is 3.7%, which is just a little above the lowest levels in five decades. That stands against the headline-grabbing list of companies where layoffs are mounting, notably in the tech sector.

    When a recession, in all likelihood, lands next year, “unemployment may peak around 5%, a historically low rate for a recession,” the Vanguard outlook said. As interest rates climb, the job losses “should be most concentrated in the technology and real estate sectors, which were among the strongest beneficiaries of the zero-rate environment.”

    The unemployment rate going from 3.7% to the 5% vicinity is “a sizable move,” Roger Aliaga-Díaz, Americas chief economist for Vanguard, said in a Monday press conference on the report. “But it is less dramatic of a rise than compared to past recessions perhaps.”

    Spotting the opportunities

    When interest rates go up, bond prices go down. So it’s been difficult for bonds with lower returns and “near-term pain” for investors this year, the Vanguard outlook said.

    “However the bright side of higher rates is higher interest payments. These have led our return expectations for U.S. and international bonds to increase by more than twofold,” the report said.

    Vanguard said U.S. bond return projections could be 4.1% – 5.1% annually over the next year versus its 1.4% – 2.4% return estimate last year. For U.S. stocks, the forecast could be 4.7% – 6.7% annually, while returns in emerging market equities could be between 7% and 9%.

    On Tuesday morning, stock markets are soaring higher on the cooler than expected inflation data, igniting hopes of an end of year Santa Claus rally.

    ‘There’s one silver lining of our outlook for a modest global recession. And it’s the clear silver lining of higher expected returns for investors.’


    — Joseph Davis, Vanguard’s chief global economist

    Still, the Dow Jones Industrial Average
    DJIA,
    +0.30%

    is down nearly 5% year to date. The S&P 500
    SPX,
    +0.73%

    is off 14% in that time and for the Nasdaq Composite
    COMP,
    +0.38%

    is down more than 26%.

    When the market hits bottom is impossible to know, the outlook said — but it noted “valuations and yields are clearly more attractive than they were a year ago.”

    “There’s one silver lining of our outlook for a modest global recession. And it’s the clear silver lining of higher expected returns for investors,” said Joseph Davis, Vanguard’s chief global economist.

    “We’re long concerned that the low rate environment was both unsustainable and ultimately a tax and a headwind for savers and long term investors,” Davis said.

    But even with all the turbulence this year, “we certainly are starting to see the dividends to higher real interest rates around the world in the higher projected returns that we anticipate for investors over the coming decade.”

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