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The Most Neighborly Cities In America

Also, Coworking Spaces Popping Up – Near College Campuses, 16.7 Million Americans Are Renting Alone and more

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Estimated read time: 3 minutes 34 seconds.

Macro Trends

Mild Global Recession Remains Likely link

  • The global economy has seen some improvement, but headwinds intensified in Q3 2023, with China’s slow economic rebound and weaker GDP growth in Canada, Germany, and Italy.

  • The U.S. economy remains resilient, but the rapid rise in interest rates is expected to lead to lower growth. Inflation is below its peak, but achieving the Fed’s 2% inflation target will be challenging, requiring slower wage growth and higher unemployment.

  • China’s weak recovery is impacting global growth, contributing to subdued real estate market activity. The slump in China’s residential real estate market and weakening exports are significant contributors to the slowdown.

Real Estate Trends

U.S. Home Affordability Drops to More Than 10-Year Low in Q3 2023 link

  • U.S. home affordability has plummeted, reaching its lowest level since Q3 2012, with median home prices surging 108% while average wages increased only 26%.

  • The report reveals that 61% of the U.S. counties analyzed are less affordable than their historical averages, indicating a widespread affordability crisis.

  • Despite the affordability crisis, the housing market remains robust with strong demand, low mortgage rates, and a scarcity of supply fueling the price hikes.

Ranked: The Most Neighborly Cities In America, According To A New Report link

  • Madison, Wisconsin tops the list as the most neighborly city in the U.S for 2023, based on factors like charitable donations, volunteering, and crime rates. It also leads the nation in non-profits per 100,000 residents and has high participation in outdoor recreational activities and community events.

  • Minneapolis and Colorado Springs follow, ranking high in volunteering and charitable giving, with Colorado Springs having the highest volunteer rates at 69%. Both cities are recognized for their unique attractions and thriving communities, contributing to their high rankings.

  • The study reveals a positive trend in community relationships, with 85% of Americans planning to stay in their current residence and 45% planning to stay for good. Additionally, 90% of Americans plan to participate more in their neighborhood events, and 94% are willing to help their neighbors in the event of a natural disaster.

Opportunities

Coworking Spaces Popping Up – Near College Campuses link

  • Coworking spaces are increasingly being established near college campuses, with four out of five top U.S. universities having at least one such space within two miles of campus. In total, 926 coworking spaces are located close to the 100 universities analyzed.

  • These spaces offer significant advantages to students, providing real-life office experience and opportunities to connect with companies and established professionals. They serve as a potential platform for students to build networks, find jobs, partners, or clients for their own businesses.

  • The proximity to campuses is not only beneficial for students but also for companies and coworking operators. Companies can target young talent for recruitment before graduation, and coworking operators gain access to a stable client pool with new groups of students each year, potentially becoming a huge benefit with more grads getting hired in remote positions.

Risks

Student loan payments are about to drain $8 billion a month from consumers, and spending will start contracting early next year link

  • The resumption of student loan repayments is predicted to amount to $5.5 billion-$8.2 billion per month, causing a sharp contraction in consumer spending early next year.

  • Fitch forecasts that student loan delinquency rates will rapidly reach or surpass pre-pandemic levels as repayments resume, with real consumer spending expected to contract by 0.8% in Q1 2024 and by 3% in Q2 2024.

  • The resumption of payments coincides with a time when 80% of excess savings from the pandemic have been spent, and other forms of debt, such as mortgage rates and credit card spending, are increasing, with US credit card debt surpassing $1 trillion for the first time in early August.

More Home Sellers Drop Their Asking Price As Mortgage Rates Hit Two-Decade High link

  • Record-high monthly mortgage payments are causing sellers to reduce asking prices, with approximately 6.5% of U.S. homes experiencing a price drop in the four weeks ending September 24, a significant increase from 5.8% a month earlier.

  • Despite the reductions, the median home-sale price has risen by 3% year over year, and buyers are facing the highest monthly payments on record due to elevated mortgage rates, reaching a daily average of 7.65% on September 27, the highest in over two decades.

  • The market is experiencing a delicate balance, with sellers needing to price homes carefully to attract buyers who are unwilling to overpay, and buyers having more room to negotiate and demand concessions due to the high interest rates and increased availability of listings since September.

Something I found Interesting

16.7 Million Americans Are Renting Alone; Salt Lake City Saw the Highest Surge link

  • Between 2016 and 2021, the number of renters living alone surged by 1 million, reaching 16.7 million, marking the fastest growth among renter segments.

  • Baby Boomers and Millennials dominate the solo renting scene, with the former requiring an income just under $50,000 to maintain this lifestyle. In contrast, Millennials, who represent 29.5% of solo renters, have an average income of $55,973.

  • Salt Lake City experienced the most significant rise in solo renters, with a 24.9% increase between 2016 and 2021. Philadelphia and Indianapolis, on the other hand, have the highest proportions of individuals renting alone at 20%.

Location Specific

Miami Moves into the Top Tier of Most Valuable Housing Metros link

  • Miami has ascended to the top five most valuable housing metros, experiencing an 86.6% increase in housing value since May 2020.

  • The city has surpassed Washington, D.C., moving up from its ninth place, joining the ranks of New York, Los Angeles, San Francisco, and Boston.

  • This significant rise in value is attributed to Miami's diverse attractions including its beaches, cruise ships, Art Deco architecture, and vibrant music and food scenes.

One Cool Chart

Housing Market Has Driven Buyers to One City That’ll Surprise You Link

  • Rochester, NY tops the list of America’s hottest housing markets in August 2023, with a modest median list price of $250,000, significantly below the national median of $435,000. This affordability attracts buyers, offering a monthly housing payment of roughly $1,400 compared to the national average of $2,400.

That's all folks. If you enjoyed today's issue, please reply (it helps with deliverability)

Cheers,

Vidit

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