Halifax2TheMax said:

tempo_n_groove said:

Shaq says it's "shrinkflation and just another form of robbery"

I typically call Shaq when I want guidance on the economy or economic policy, particularly monetary policy and what the Fed might do and where its all headed. Gotta stay ahead of the curve.

The Juggler said:

tempo_n_groove said:

The Juggler said:

The tide is turning a bit...

They added another 1/2 percent.

Everyone knew they would. Check the 10 year. 

The Juggler said:

mrussel1 said:

The Juggler said:

tempo_n_groove said:

The Juggler said:

The tide is turning a bit...

They added another 1/2 percent.

Everyone knew they would. Check the 10 year. 

The problem is the comments, that the rate hikes are likely not over.  I think the market expected this to be the last one after yesterday's inflation news.  

Yeah but the bond market did not seem to believe everything he was saying though. That is why the 10 yr, after initially jumping up, is now broaching 3.4 again. As he was talking it was going down. If unemployment ticks up to the level he mentioned, that is a recession. They're not going to continue raising rates if we're nearing that level. I bet we see mortgage rates around 5% ish or below a whole lot faster than most people think. 

Logan Mohtashami is a good follow on twitter for this stuff. 

Also, I don't think the market realistically expected yesterday to be the last increase. Likely have just a couple, maybe a few left. 

The company has become one of the nation’s largest landlords in recent years and imposed some daunting rent hikes

Halifax2TheMax said:

Thanks Brandon, really appreciate it! Particularly rich is that Barry spoke at a conference at the Milkin Institute in Beverly Hills.

Rising rents were a crisis for tenants. For Starwood, they were a gift.

The company has become one of the nation’s largest landlords in recent years and imposed some daunting rent hikes

For tenants across the country, the huge rent hikes of recent years have been a burden. For the private investment firms emerging as America’s landlords, they’ve been a bonanza.

Amid a flurry of sales over the past decade, when more than $1 trillion of apartment buildings changed hands, private investors and real estate trusts went on a binge: The proportion of apartments sold to them rose from 44 percent in 2011 to 70 percent in early 2022, according to data and research firm MSCI.

Many of those same firms imposed aggressive rent increases and rode the historic wave of rent hikes to big profits.

Few, however, stood to benefit more than Starwood Capital Group.

A private investment firm led by Florida billionaire Barry Sternlicht, Starwood has been one of the most active acquirers of apartments, and a model for the industry. Over the past seven years, it has amassed a portfolio of more than 115,000 apartments, which by some rankings stands as the nation’s largest such collection.

Private firms rarely disclose specific information about rent hikes, but according to leases reviewed by The Washington Post, prices at some Starwood complexes increased by 30 percent or more.

At Starwood’s Wellington Green in Palm Beach County, Fla., the company raised some rents by as much as 52 percent in 2022; at the Griffin Apartments in Scottsdale, Ariz., it increased them by 35 percent. At the Cove at Boynton Beach, it boosted rents on some units by as much as 93 percent in 2022.

At some Starwood apartment complexes intended for low-income tenants and built with government subsidies, the company increased rents by 10 percent. Though the rents on such units are limited by Department of Housing and Urban Development guidelines, the company began charging higher rent soon after the government lifted the limits, even for tenants who were mid-lease.

“Tenants seem capable and willing to pay these rent increases,” Sternlicht said in early 2022 in a call with investors. “I think this is the strongest real estate market I’ve seen in 30 years, 35 years.”

While Starwood says its prices merely reflect market forces and its own rising costs, the growing role of private investors among the nation’s apartment landlords coincides with a historic wave of rent hikes.

In 2021, rent increases were more than double what they had been any previous year, according to the Yardi Matrix Multifamily National Report, with asking rents jumping by 10 percent or more in 26 major metropolitan areas. The increases continued through at least October 2022, when rents were rising about 8 percent annually.

“When they said my rent was going up, I was like, ‘What in the world?’” said Sakeema Rainner, 29, who with her four children rented a government-subsidized West Palm Beach apartment where she said the rent jumped about 10 percent. “They just don’t care.”

Starwood provided some figures to The Post showing that the company raised rents at an average rate of 17 percent in its top 10 markets from January to September 2022. By comparison, overall rents rose in those same markets at a rate of about 12 percent over that period, according to numbers from CoStar, the data firm, shared by Starwood.

The company raised rents more slowly than competitors in 2021, however, according to the figures it provided: It boosted rents by 6 percent while competitors in those markets raised rates by 12 percent.

In a statement, the company said that it has a legal responsibility to reward its investors and that it is “contending with record increases in operating expenses and interest on our mortgages.”

“Starwood is one of the world’s premier real estate investors and owner of apartment properties,” the company said in its statement. “Our reputation is extremely important to us both as an investor and a landlord, and it is something we take very seriously. We would not have been able to grow and maintain our portfolio at this size if we acted differently than any other landlord in this space.”

Tenants

Contrary to Sternlicht’s assessment that tenants are “capable and willing” to pay more, those at several Florida apartment complexes owned by Starwood affiliates said they are struggling to pay the higher rates.

Continues…..

https://www.washingtonpost.com/business/2023/01/02/starwood-rents-apartments-private-investors/

static111 said:

tempo_n_groove said:

Halifax2TheMax said:

Thanks Brandon, really appreciate it! Particularly rich is that Barry spoke at a conference at the Milkin Institute in Beverly Hills.

Rising rents were a crisis for tenants. For Starwood, they were a gift.

The company has become one of the nation’s largest landlords in recent years and imposed some daunting rent hikes

For tenants across the country, the huge rent hikes of recent years have been a burden. For the private investment firms emerging as America’s landlords, they’ve been a bonanza.

Amid a flurry of sales over the past decade, when more than $1 trillion of apartment buildings changed hands, private investors and real estate trusts went on a binge: The proportion of apartments sold to them rose from 44 percent in 2011 to 70 percent in early 2022, according to data and research firm MSCI.

Many of those same firms imposed aggressive rent increases and rode the historic wave of rent hikes to big profits.

Few, however, stood to benefit more than Starwood Capital Group.

A private investment firm led by Florida billionaire Barry Sternlicht, Starwood has been one of the most active acquirers of apartments, and a model for the industry. Over the past seven years, it has amassed a portfolio of more than 115,000 apartments, which by some rankings stands as the nation’s largest such collection.

Private firms rarely disclose specific information about rent hikes, but according to leases reviewed by The Washington Post, prices at some Starwood complexes increased by 30 percent or more.

At Starwood’s Wellington Green in Palm Beach County, Fla., the company raised some rents by as much as 52 percent in 2022; at the Griffin Apartments in Scottsdale, Ariz., it increased them by 35 percent. At the Cove at Boynton Beach, it boosted rents on some units by as much as 93 percent in 2022.

At some Starwood apartment complexes intended for low-income tenants and built with government subsidies, the company increased rents by 10 percent. Though the rents on such units are limited by Department of Housing and Urban Development guidelines, the company began charging higher rent soon after the government lifted the limits, even for tenants who were mid-lease.

“Tenants seem capable and willing to pay these rent increases,” Sternlicht said in early 2022 in a call with investors. “I think this is the strongest real estate market I’ve seen in 30 years, 35 years.”

While Starwood says its prices merely reflect market forces and its own rising costs, the growing role of private investors among the nation’s apartment landlords coincides with a historic wave of rent hikes.

In 2021, rent increases were more than double what they had been any previous year, according to the Yardi Matrix Multifamily National Report, with asking rents jumping by 10 percent or more in 26 major metropolitan areas. The increases continued through at least October 2022, when rents were rising about 8 percent annually.

“When they said my rent was going up, I was like, ‘What in the world?’” said Sakeema Rainner, 29, who with her four children rented a government-subsidized West Palm Beach apartment where she said the rent jumped about 10 percent. “They just don’t care.”

Starwood provided some figures to The Post showing that the company raised rents at an average rate of 17 percent in its top 10 markets from January to September 2022. By comparison, overall rents rose in those same markets at a rate of about 12 percent over that period, according to numbers from CoStar, the data firm, shared by Starwood.

The company raised rents more slowly than competitors in 2021, however, according to the figures it provided: It boosted rents by 6 percent while competitors in those markets raised rates by 12 percent.

In a statement, the company said that it has a legal responsibility to reward its investors and that it is “contending with record increases in operating expenses and interest on our mortgages.”

“Starwood is one of the world’s premier real estate investors and owner of apartment properties,” the company said in its statement. “Our reputation is extremely important to us both as an investor and a landlord, and it is something we take very seriously. We would not have been able to grow and maintain our portfolio at this size if we acted differently than any other landlord in this space.”

Tenants

Contrary to Sternlicht’s assessment that tenants are “capable and willing” to pay more, those at several Florida apartment complexes owned by Starwood affiliates said they are struggling to pay the higher rates.

Continues…..

https://www.washingtonpost.com/business/2023/01/02/starwood-rents-apartments-private-investors/

I've had this conversation with people who didn't believe me that corporations were creating the uptick in housing pricing. This article is a pretty damn good example of it.

mrussel1 said:

TSLA down another 14% today (as of now).  At some point they will be worth buying.