Finally! 11 Cities Where Home Prices Are Falling

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A White Paper On Mid-Year Private Equity Outlook in 2024 link

• Interest rates will remain higher for longer due to strong near-term growth, deglobalization, the energy transition, increased defense spending, rising Treasury issuance, and US fiscal deficits.

• With rates higher for longer and growth eventually slowing down, opportunities in private equity will likely continue to emerge among potential distressed companies.

• Ongoing uncertainty and volatility in the broader market call for a flexible, value-oriented strategy in private equity. Strategies with the ability to invest opportunistically across the capital stack are well-positioned to capitalize on the shifting fortunes of companies seeking financing in these turbulent times.

Here’s how bad housing affordability is now link

• Prices in April increased by 6.3% compared to the previous year, with the S&P CoreLogic Case-Shiller National Home Price Index marking the second consecutive month of record highs. Despite rising mortgage rates, prices continue to soar.

• The median sale price is now five times the median household income, making it one of the least affordable housing markets in U.S. history. Homeowners and renters face significant cost burdens, with half of renter households spending over 30% of their income on housing.

• An 11% increase in new listings from March to April pushed total for-sale inventory up by 18% year over year. However, supply remains low compared to demand, and homes priced well are selling quickly, within 13 days on average.

Value Grocery Stores Outstrips Traditional Grocers in Visit Growth link

• In May 2024, Aldi and Grocery Outlet Bargain Market saw year-over-year visit increases of 26.3% and 14.3%, respectively, while traditional grocery chains saw a 7.9% rise. This indicates a strong consumer shift towards value-oriented shopping amidst persistent inflation.

• Aldi and Grocery Outlet Bargain Market use strategies like limited product assortments and private labels to reduce costs, attracting more budget-conscious shoppers. Their expansion efforts, with Aldi opening dozens of new stores, are meeting robust demand.

• Customer loyalty for both chains has increased significantly over the last three years. By May 2024, 30.1% of Aldi's and 30.2% of Grocery Outlet Bargain Market's visits were from repeat customers, up from 28.0% and 27.0% in April 2022.

11 Cities Where Home Prices Are Falling (See Image Below)

Where Goldman Sachs' and Moody's forecast models expect U.S. home prices to go in 2024, 2025, 2026, and 2027

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I kind of want to live in a windmill now!

Link to the listing

That's all, folks.

Cheers,

Vidit

P.S - Read past newsletters here