Inflation’s Coming Back

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Treasury Tsunami Coming—$9 Trillion in Debt Matures Soon link

• The U.S. government must refinance $9 trillion of debt over the next 12 months, putting pressure on Treasury markets just as debt-servicing costs hit a record $3.3 billion per day. Interest payments now consume about 20% of all federal tax revenue.

• Despite stable demand today, long-term risks are mounting: debt is rising faster than GDP, the dollar is weakening, and investors may soon demand higher yields to keep buying. That points to rising long-term interest rates ahead.

• The CBO expects government debt to swell from 100% to 150% of GDP under current policies, creating major fiscal strain and upward pressure on both short- and long-term borrowing costs. This could ripple across both public and private markets.

Apartment demand surges past supply in the Desert/Mountains region link

• Over 85,000 apartment units were absorbed in the Desert/Mountains region over the past year, while only 77,000 new units were delivered—demand outpaced supply by 11%.

• Inventory in the region grew by more than 5%, the second-highest jump in the country after the Carolinas.

• This demand-supply gap has helped stabilize occupancy rates, even as construction ramps up across cities like Phoenix and Denver.

Inflation’s Coming Back—But CRE Might Be in a Sweet Spot link

• Oil prices jumped 20% in early June due to Middle East conflict, while shipping costs from Asia surged 167% since January—both pointing to inflation risks hitting later this year. These trends could pressure the Fed to hold rates steady longer than expected.

• Consumer spending, which makes up 70% of U.S. GDP, is holding for now thanks to stable job creation and rising savings. But retail sales may have been artificially boosted in May due to pre-tariff panic buying.

• Despite rate uncertainty, Marcus & Millichap’s John Chang says most property types in most locations still have a strong investment outlook. He believes we’re in a “comparatively good investment window” for CRE right now.

Nearly 1 in 5 Sellers in Some Cities Are Now Losing Money on Their Homes link

• Nearly 47.5% of post-pandemic home sellers in Austin are at risk of selling at a loss—the highest share among major U.S. metros. In contrast, cities like Providence, RI, have virtually 0% of sellers facing a potential loss.

• Condos are especially vulnerable: 28.7% of condos bought after the pandemic are likely to sell at a loss, compared to just 12.9% of post-pandemic single-family homes. Restrictions on leasing and softer demand are making condos harder to sell without cutting price.

• If home prices drop by 1% nationwide by year-end, the share of homes at risk of loss will rise from 5.7% to 6.4%. For post-pandemic buyers, the risk could spike from 16.4% to 19.1%, showing how thin the equity cushion is for recent buyers.

Sun Belt Surge: Build-to-Rent Homes Exploding Across the South link

• Phoenix leads the nation with 11,500 build-to-rent (BTR) units under construction—nearly 1 in 5 of all BTR homes in the U.S. Dallas and Houston follow, with 5,500 and 4,470 units respectively.

• Over 64,000 BTR units are currently being built nationwide, and 57% are in the Sun Belt alone, signaling a deep geographic shift in single-family rental demand.

• While new project starts are slowing, over 7,500 more units are still in planning, and the sector has more than doubled in five years—jumping from 107,000 homes to 217,161.

Single-Family Rents Climb Again link

• U.S. single-family rents rose 2.9% year over year in April 2025, matching March’s annual growth rate, with a 0.8% monthly bump from March to April. Attached units saw slightly higher gains (2.7%) compared to detached homes (2.4%).

• Rent increases were strongest in the Northeast, Midwest, and Mid-Atlantic, while the South saw the smallest growth—mirroring trends in home prices. This regional divide points to ongoing affordability challenges and inventory constraints in key metros.

• With for-sale inventory tight, more would-be buyers are staying renters—pushing rental demand higher. This is contributing to steady rent growth despite broader market cooling.

Trouble in Florida link

• Florida’s median home price peaked at $423,000 in April 2024—up 61% from early 2020—but has already fallen 3%, with more drops expected as oversupply and high costs scare off buyers. Builders now offer steep discounts, mortgage buy-downs, and closing cost help to keep sales moving.

• Home insurance premiums jumped 45% from 2017 to 2022, with some insurers exiting the state entirely. Combined with rising HOA fees and taxes, the carrying costs are making it harder for owners—especially of older condos—to sell.

• Four major Florida metros (Tampa, Miami, Orlando, Fort Lauderdale) saw some of the steepest net migration declines in the country from 2023 to 2024. Markets like Orlando and Cape Coral are now flagged as "bearish" by analysts due to excessive supply and softening demand.

Motif

Architecture design platform integrating AI to modernize building design software.

AI cracks PDF chaos—CRE underwriting finally goes real-time link

• A new GPT-powered system now extracts data from CRE appraisal PDFs with 97.72% accuracy on rent comps and 95.06% on sales comps, reducing errors and speeding up underwriting. This turns multi-hour manual reviews into minutes-long tasks.

• The platform preserves Excel as the end-user interface, respecting entrenched analyst workflows while adding traceability down to page numbers—critical for compliance-heavy environments like real estate lending.

• Manual PDF data extraction was killing scalability; this solution reversed that by automating rent/sales comp pulls, appraisal data, and unit mix analysis, all while maintaining consistent quality at scale.

AI Is Quietly Killing These Jobs — And Hiring Is Slowing Fast link

• Roles with high exposure to AI, like IT specialists and data engineers, saw job postings drop by 31% since ChatGPT launched, compared to a 25% drop in low-exposure roles like restaurant managers. Employers are already pulling back on hiring where AI can step in.

• Over the last 3 years, the share of AI-doable tasks in online job listings has dropped 19%, mainly because companies are hiring less for roles AI can do—not because tasks have changed. It’s a clear signal of AI-driven job displacement happening now, not in the future.

• Freelance writers were hit early: On Upwork, jobs in writing-related roles fell 2% and earnings dropped 5.2% after ChatGPT launched. Even companies that bragged about AI replacing staff, like Klarna, are now reversing course due to quality issues.

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