Top 20 Reasons for Moving in the Next Year

Good morning, Dwellers! Welcome to another edition of Dwellings Digest, a realtor and investor driven newsletter simplifying real estate, exploring the economy-stock-real estate link, adding a fun twist with niche topics and more. Enjoy!

Quote of the day - Behind every front door is a life waiting to be lived.

In today’s edition - we highlight a significant dip in U.S. jobless claims, hitting a 7-month low at 213,000, signaling potential strength in job growth for November. We also discuss the housing market's recovery, with a 3.4% increase in home sales and prices climbing 4.0% year-over-year, despite rising inventory levels. Additionally, Bitcoin’s price has soared to a new all-time high of $98,374, fueled by optimism over regulatory changes, including the SEC Chair's departure and political momentum for pro-crypto policies. These developments suggest shifting economic trends that could impact both real estate and broader financial markets

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Rates & REITS

Average going rates as of Nov 21 2024

Numbers as of Nov 21 2024

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🏛️ Economic & Market Sentiment

Jobless Claims Hit 7-Month Low as U.S. Job Market Rebounds

• Jobless Claims Plunge to 7-Month Low

  • Initial unemployment claims dropped to 213,000, surpassing expectations of 220,000 and marking a 6,000-claim decline from the previous week. This indicates a potential rebound in job growth for November.

• Housing Market Shows Signs of Recovery

  • Home sales rose 3.4% in October, reaching an annualized rate of 3.96 million units, with prices climbing 4.0% YoY to a median of $407,200 despite rising inventory levels.

• Economic Momentum May Influence Fed Rate Cuts

  • Continuing claims rose to 1.908 million, highlighting slower re-hiring trends. Upcoming labor data could shape the Fed’s decision on a potential third rate cut in December.

Bitcoin jumps back above $98,000 after SEC announces Gary Gensler will step down

1. Bitcoin Soars on Optimism for Pro-Crypto Regulation

• Bitcoin hit a new all-time high of $98,374, gaining +3.58% in a single day, as optimism surged following SEC Chair Gary Gensler's announced departure in January.

• The rally reflects expectations of industry-friendly policies under the Trump administration, including a White House crypto advisory role and plans for a national bitcoin stockpile.

2. Pro-Crypto Political Momentum Builds

• Trump pledged a pro-crypto presidential advisory council and a regulatory framework promoting clarity and growth.

• Ohio elected pro-crypto candidate Bernie Moreno to the Senate, shifting control to Republicans and boosting optimism for supportive legislation.

• The crypto industry spent over $130 million to influence key elections this fall.

3. Industry Awaits Clearer Rules and Market Participation

• Coinbase and other firms stand to benefit from reduced regulatory clashes.

• Hunter Horsley (Bitwise Asset Management) emphasized the need for clear regulation, while Mike Novogratz (Galaxy Digital) called for policy enabling U.S. crypto players to thrive globally.

🎢 Impact on Real Estate

Where Are the Most Million-Dollar Homes?

• Million-Dollar Homes Are Growing Rapidly

  • In 2023, 10.57% of homes in the top 50 U.S. metros were valued at $1 million or more, up from 7.71% in 2022. This represents a 2.86 percentage-point increase, adding 1.32 million homes to the category year over year.

• California Metros Dominate High-Cost Housing

  • San Jose leads with 71.57% of homes valued over $1 million, followed by San Francisco (56.57%) and Los Angeles (36.42%), driven by limited supply and tech-driven wealth. Median home values in these metros exceed $850,000.

• Affordable Metros Still Exist

  • Cleveland, Buffalo, and Louisville rank lowest for million-dollar homes, with shares of 1.09%, 1.16%, and 1.44%, respectively. Median home values in these areas range between $217,000 and $253,000.

🎙️ RE Spotlight

Families Need To Spend 38% of Their Income on Housing - Here is More

• Coastal Housing Burden Hits Highs

  • In San Jose-Sunnyvale-Santa Clara, CA, families need 85% of their income to cover a mortgage on a median-priced home ($1.79M). Similarly dire figures appear in Honolulu, HI (75%) and San Diego, CA (70%), driven by sky-high property values and limited affordability.

• Midwest Offers Relief

  • Affordable housing thrives in Decatur, IL, where families spend just 16% of their income on a mortgage (median price: $134,170). Other budget-friendly markets include Cumberland, MD-WV (18%) and Springfield, IL (18%), showcasing stark contrasts with coastal costs.

• Low-Income Families Face Challenges Everywhere

  • In costliest markets, low-income families need between 127% and 170% of their earnings for housing. Even in the Midwest’s most affordable areas, this figure remains more manageable, ranging from 33% to 39%.

Trump’s Election Boosts Republican Homebuyer Optimism as Democrats’ Hopes Sink

• Homebuying Sentiment Reflects Party Lines

  • 1 in 5 Republicans report being more likely to buy a home post-election, citing economic optimism and trust in the new administration. In contrast, 24% of Democrats are less likely to buy, citing fears of economic instability and rising inflation.

• Independents Remain Unchanged

  • While partisan voters feel strongly, 74% of independents say Trump’s election hasn’t affected their homebuying plans, showing a stark contrast to polarized party views.

• Men and Gen Z Are Most Optimistic

  • 18% of men and 22% of Gen Z report heightened confidence in buying a home following Trump’s win, outpacing women (10%) and older generations like Baby Boomers (6%).

🏰 RE State Zone

Southern California Housing Market Update: Nov. 2024

Note: Data in this release is taken from county records and not from local multiple listing services.

September Home Sales Volume and Annual Changes

September Median Sales Prices and Annual Changes

🏕️ Niche-RE

U.S. Multifamily Market: Class A Rent Growth Forecast to Surge 2.4% Nationally by 2026 - Full Rent Outlook

• Class A Rent Growth Forecast: U.S. multifamily markets are expected to see a 2.4% national year-over-year (YOY) rent increase by January 2026, with key markets like Orlando, Jacksonville, and Tampa leading with growth ranging from 4.0% to 5.7%.

• Declining Supply and Strong Demand: Despite 600,000 new units projected in 2024, the delivery pipeline will drop by 15.2% in 2025 and 53.8% in 2026, ensuring continued high absorption rates and rising rents in many regions.

• Regional Rent Trends: Growth will remain strong in the Northeast, Southeast, and West, with markets like Miami (4.3%) and Seattle (4.4%) seeing consistent above-average YOY rent gains, while the Southwest experiences minimal growth at just 0.2%.

• Market Outlook & Risks: Origin Investments anticipates a bull cycle for rents, but external shocks such as a recession or falling mortgage rates could disrupt the trend. In markets where renting is 40%-50% cheaper than buying, the trend toward a nation of renters remains strong.

The Future of Rent Collection: Best Practices and Digital Payment Insights

• Online Rent Payments Now Preferred by 69% of Renters

  • Digital solutions like property management software and P2P apps streamline rent collection, with benefits like automatic tracking, encrypted security, and reduced administrative costs, making them a top choice for both residents and managers.

• ACH Transfers Offer Stability and Cost Efficiency

  • With lower fees (under $1 per transaction) and automated scheduling, ACH transfers remain the most professional method for rent collection, especially for larger portfolios requiring clear audit trails.

• Leases with Clear Payment Policies Reduce Late Payments

  • Defining due dates, acceptable methods, and late fees in leases upfront can lower disputes by 30%, ensuring smoother operations and higher on-time payment rates.

🖼️ Chart-Tastic

👾 Interesting in Social

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And…that's a wrap on this edition!

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