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In Areas at High Risk for Wildfires, Relative Affordability Lures Homebuyers
The median sale price of homes in zip codes with a low wildfire risk has increased 101% since 2012, compared with an 88% increase for homes in high-wildfire-risk zip codes, according to a new report from Redfin. This disparity exacerbates the affordability crisis in low-risk areas, forcing homebuyers who don’t have large budgets to look to more fire-prone regions for affordable homes. Redfin’s analysis is based on its own housing market data and U.S. Forest Service data across 2,700 zip codes in California, Oregon, and Washington.
Over the 12 months ending August 2020, homes in high-wildfire-risk zip codes sold for an average of 3.9% less than those in low-risk zip codes—$640,000 compared to $656,000. This is a reversal from eight years earlier. In 2012, homes in high-risk areas sold for an average 2.5% more than in low-risk areas.
Home prices in high-risk areas first dipped below prices in low-risk areas in 2015—three years before the Camp Fire became the most destructive wildfire in California history, destroying over 18,000 structures and killing 85 people.
Double-digit price growth in already expensive West Coast cities has likely driven homebuyers to look in more affordable, but fire-prone areas. For example, Bay Area homebuyers who are priced out of San Francisco, where the median home sold for $1.45 million in September, may feel forced into more high-risk areas such as Santa Rosa, where the median price in September was $690,000, or Sacramento, where the median price was $475,000.
Multifamily Move-Ins Rebounded in September As Leasing Concessions Reached New Peak
Some facets of multifamily leasing stabilized in September while others reflected continued impact from the COVID-19 pandemic, according to the latest report from Proptech firm MRI Software. Notable metrics include a new peak in concession volume, a rebound in move-in volume, and lower lease pricing compared to September 2019.
The firm’s newest report compiles data from more than one million market-rate units (a subset of the total units managed by MRI clients) in January-September 2020 and January-September 2019. Analysis includes both year-over-year and month-over-month comparisons.
Other highlights from the report include:
- Move-in volume was only 3% off that of September 2019, after lagging 2019 by approximately 20% since March.
- Concession volume reached a new high of 21% while the average concession value increased by 13% year-over-year.
- Lease pricing was 3% lower than that of September 2019.
- Traffic exceeds prior year volume.
- Many tenants continue to rely on cards for rent. Card payments have increased by 60% compared to January of this year.
“The rise in move-in volume was a pleasant surprise,” says Brian Zrimsek, Industry Principal, MRI Software. “It indicates potential stabilization in the market. As for the concessions, high volume and value concern me, especially when coupled with lower base rent pricing.”
Trump Condos Fetch a 10% Premium Over Similar Luxury Units, Down From 34% in 2016
The Redfin analysis, which excludes New York City, also finds that 57% of condos in Trump-branded buildings mention ‘Trump’ in the online listing description, down from 78% four years ago
The typical “Trump” branded condo sold for a median of $720,000 this year—9.7% more than a comparable luxury condo, according to an analysis from Redfin. That’s down from a 22% price premium Trump-branded condos fetched in 2019, and a 33.5% premium in 2016, when Donald Trump was elected president. The price premium of Trump-branded condos has declined every year that Trump has been in office.
The Redfin analysis focused on Trump-branded and comparable luxury condos in 10 U.S. cities, with the exception of New York City, where multiple listing service data on sales of Trump properties was incomplete. The research compared the properties by sale price, price per square foot and time spent on market, with results controlled for features such as location, size, views and number of bedrooms and bathrooms. The analysis includes sales of Trump-branded condos and other luxury units in cities including Hollywood Beach, FL; Sunny Isles Beach, FL; Honolulu; Chicago; Jersey City, NJ; Stamford, CT; Las Vegas; New Rochelle, NY; Shrub Oak, NY and White Plains, NY.
The median sale price of the typical Trump-branded condo has declined 17% since 2016, while the price of the typical comparable luxury condo has dropped 1.3%.
Trump properties also take longer to sell; the typical Trump-branded condo spent 118 days on the market before going under contract this year, compared with 78 days for the typical comparable luxury condo.