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Inside Real Estate (Aug 21st, 2019)

Hello Inside Real Estate Readers,

Paring down a Twitter list is not easy! I'd love your help in deciding who should be in a Real Estate Top 100 list. What's most useful to you — real estate reporters, real estate agents who talk about their markets, housing advocates? Some people I have on the list currently include real estate coach Tom Ferry, San Francisco agent Herman Chen, and Patrick Kearns, a reporter at Inman News. 

Thank you,

Deidre

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1. Existing-home sales in July were up by 2.5 percent from the previous month and up 0.6 percent from one year ago to a seasonally adjusted annual rate of 5.42 million. Compared to last year, sales were up in the Midwest and South but down in the Northeast and West. The median price of $280,800 is up 4.3 percent from one year ago, driven by strong gains in the West and South as well as the Midwest, where the median price of $226,300 represents an 8.1 percent increase from one year ago. 

Total housing inventory was down 1.6 percent from 1.92 million one year ago. Unsold inventory is at a 4.2-month supply at the current sales pace, down from the 4.3-month supply recorded in July of 2018. Lawrence Yun, chief economist for the National Association of Realtors, noted that the inventory of moderately-priced homes is inadequate and more home building is needed (see the article below on the missing middle for more about this issue). — MARKETWATCH

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2. The Mountain in Beverly Hills — once the most expensive property listed in the U.S. — was sold at auction for just $100,000. The property was marketed for $1 billion and was most recently listed at $650 million. It was sold back to an entity associated with the Mark Hughes Trust. The trust was the previous owner and was owed around $200 million in debt related to the estate. After a judge denied bankruptcy for the prior owners, the 157-acre property's fate was sealed. It seems likely that the property will be relisted, the only question is, at what price? — WSJ (paywall)

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3. Jargon Watch: Missing Middle. In all the talk of affordable housing, what sometimes gets forgotten is what is termed the missing middle. The missing middle refers to those who are struggling to afford rent or to buy a home but do not meet low-income requirements for public housing. Missing middle housing is also sometimes called workforce housing because the people in this segment include teachers, healthcare professionals, and the people who in general, keep a community running. The problem of the missing middle has been particularly prevalent on the West Coast where the cost of housing has exceeded the limits of a middle-class two-income family. When a household spends more than 30 percent of income on rent or a mortgage, they are often unable to save and are more vulnerable in an emergency. 

Affordability is just one concern for the missing middle; the other issue is inventory. The limited supply of starter homes is also compromised by the growth of large real estate investors. That is one reason for the creation of so many startups that buy a house for cash and then resell it to the actual buyer. Another solution has been housing that is designated for a particular group of people such as teachers. Zoning changes to allow for multi-family homes have also been touted as a potential solution. Some of the candidates in the 2020 presidential election are addressing not just the issues of homelessness but also serving this growing group through downpayment assistance and other programs.

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4. A Boston developer wants to bring a horse track and casino to Wareham, Massachusetts. The $300 million plan calls for a hotel and slots parlor in a former quarry. Wareham Park would be the first casino built in the Southeastern part of the state since a new law allowing casinos went into effect. There are currently two casinos in the state, the Encore Boston Harbor in Everett and the MGM in Springfield. The plan would also bring horse racing back to the state now that Suffolk Downs is closed. As the developer, Tom O'Connell, stated in the press conference, this is "not your father’s racetrack." O'Connell believes he can bring modern racing back to the state and revive the local thoroughbred industry. — WBZ

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5. Uber is building out a large hub in Chicago. The rideshare company has leased over 450,000 square feet in the Old Main Post Office building and will be the anchor tenant. It will be the second-largest location for Uber. The 2.8-million-square-foot post office building first opened in 1921 and a city takeover was approved in 2016. Other tenants include Walgreens, Ferrara Candy, and the Chicago Metropolitan Agency for Planning. Uber is also expanding in Dallas and will move 3,000 people into a new tower at The Epic. — CRAINS CHICAGO BUSINESS

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6. For its fiscal third quarter, luxury homebuilder Toll Brothers reported earnings per share of $1.00 and revenue of $1.77 billion, down 11 percent from one year ago. The results beat analyst forecasts. Deliveries were down 11 percent to 1,994 units. Both contracts and the net contract value were down as well. Toll Brothers is forecasting full-year deliveries of 7,800-8,100 units with an average price of $860,000-$880,000. Although Toll Brothers homes are positioned at the upper end of the new homes market, Chairman and CEO Douglas C. Yearley said in a press release that low mortgage rates, continued low inventory, and strong employment are "providing tailwinds." — BUILDER

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7. Neighbor.com is the latest startup that allows people to monetize their homes. The company allows homeowners to list available storage spaces and is now live in 48 states. Neighbor started in Salt Lake City almost two years ago and has seen 500 percent growth. It raised $2.5 million in 2018 seed round and is currently pursuing additional funding. While there are a wide variety of self-storage facilities in just about every city in the U.S., Neighbor appeals to those who may not need space for a long period of time or are only looking for a small amount of storage. — CNBC

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8. Zenhomes, a Berlin-based property management platform, has raised €13 million ($14.4 million) in a Series A funding round. The platform is designed for smaller property owners and landlords who want to have an online solution for interacting with tenants.  It has a tiered subscription service offering contracts, lead management, and a tenant hotline. Zenhomes operates Vermietet.de, a platform in Germany that allows tenants to pay rent and request repairs. — SILICON CANALS

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9. One of Beijing's most recognizable buildings was auctioned off for $1 billion. Pangu Plaza is located next to the Bird's Nest Olympic stadium in Beijing and has a distinctive curving shape. It is made up of five buildings, the tallest of which forms the head of a dragon. Over 145,000 people followed the auction but only two bidders participated. The building was once owned by fugitive billionaire Guy Wengui who has been in exile since 2014.  The tower was bought by YuCheng Zhiye, a Beijing-based property development, and management company. — SOUTH CHINA MORNING POST

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10. A bright pink house in Manhattan Beach, California, adorned with two giant emoji is now for sale. The Emoji House went viral as part of a dispute between two neighbors. The current owner bought the property in 2018 for $1.35 million and has used it as a short-term rental. The city of Manhattan Beach charged the owner $4,000 in fines for operating an illegal rental. The owner gave the home its current paint job to retaliate against the neighbors that made the complaints leading to the fine. The home is now listed for $1.749 million. — CURBED LA

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Written and curated by Deidre Woollard. Deidre has a background in real estate public relations and runs the largest Facebook group for real estate press opportunities. Tips welcome at deidre@inside.com.

Editor: Kim Lyons (Pittsburgh-based journalist and managing editor at Inside).

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