Episode Details

In this Real Estate News Brief for the week ending April 10th, 2021... an economic forecast from the International Monetary Fund, home price growth around the world, and a survey on having pets at work.

Economic News

We begin with economic news from this past week, and an upbeat forecast from the International Monetary Fund. The IMF raised its 2021 U.S. economic outlook from 5.1% to 6.4%. It expects to see a slowdown next year to 4.4% which is stronger than the Federal Reserve's 3.3% prediction. The IMF also expects that pandemic-related losses for other major economies will be smaller than what we saw after the financial crisis. It is expecting global growth to be just slightly less than the U.S. this year, and about the same next year.

The IMF also expressed support for the Fed's "go slow" policy on interest rate hikes and tapering. The IMF's chief economist, Gita Gopinath, says: "They have pledged to, kind of, given sufficient advance warning if they are going to reverse course… so we expect that would happen."

Weekly unemployment claims jumped higher for a second week in a row. Economists had expected them to decline but the Labor Department reported 728,000 new state claims. That's 16,000 more than the previous week. Before the pandemic, the weekly average was around 220,000. If you combine all the new and continuing benefits from both state and federal programs, the total is 18.2 million. Before the pandemic, there were less than 2 million people collecting benefits.

On a positive note, job growth is surging. The government says there were 7.37 million jobs available in February. That's up from 7.1 million in January. It says that 5.74 million people were also hired in February, and the U.S. gained another 916,000 new jobs in March. Those are all good numbers.

Mortgage Rates

There's also good news on mortgage rates. Freddie Mac says the average 30-year fixed-rate mortgage dropped 5 basis points, to 3.13%. That's after seven weeks of higher rates. Freddie Mac says that mortgage rates are lower because of a "modest decline" in U.S. Treasury yields.

In other news making headlines...

Worldwide Home Prices

Home prices are going up around the world. International property consultant Knight Frank says that average urban home prices went up 5.6% last year. That's up from 3.2% in 2019. Emerging markets are seeing some of the strongest price gains, including Turkey which has a few cities at the top of the list. In Ankara, the year-over-year increase is 30.2%. Ismir and Istanbul are close to that. Turkish inflation is pushing those prices higher, but other countries are seeing double-digit year-over-year increases. Cities in Russia, New Zealand, Canada, and South Korea are all near the top of the list.

U.S. cities with double-digit price growth include Phoenix at 14.4%, Seattle at 13.6%, San Diego at 13%, Boston at 11.4%, Washington, D.C. at 10.3% and Minneapolis at 10.2%.

Higher Property Taxes for Homeowners

As home prices soar, so do home values and property taxes. ATTOM Data Solutions says that U.S. property taxes rose 5.4% in 2020. The average for single-family homes in 2020 was $3,719. That translates into an effective tax rate of 1.1% but researchers say many states have much higher tax rates. The highest is New Jersey with 2.2%. Illinois is second at 2.18%. And, Texas is third at 2.15%. At the low end is Hawaii with a tax rate of .37%.

CA Landlord Accepts Bitcoin for Rent

The Los Angeles-based real estate company Caruso announced that it will accept rent payments in bitcoin from residential and commercial tenants. Developer Rick Caruso founded the company which is known for high-end outdoor malls like The Grove in Los Angeles and a resort near Santa Barbara.

Caruso said during a CNBC interview that he hopes to create a whole ecosystem where tenants and guests can use cryptocurrency to check into a resort, pay re