Real Estate Daily News Buzz is designed to give news snippets to readers that our (yet to be award winning) editors thought you could use to start your day. They come from various business perspectives, real estate, government, the Fed, local news, and the stock markets to save you time. Here you will find the headlines and what the news buzz of the day will be.
Thursday, the Dow Jones industrial average lost 252.01 points, or 1.4%, to 17,477.67. The Standard & Poor’s 500 index fell 29.89 points, or 1.4%, to 2,049.62 and the NASDAQ composite fell 85.70 points, or 1.7%, to 5,037.53.
Benchmark U.S. crude jumped $1.14, or 2.9 per cent, to close at $41.08 a barrel on the New York Mercantile Exchange. Brent crude, which is used to set prices for international oils, climbed $1.35, or 3.2 per cent, to $43.84 a barrel in London.
Heating oil rose 5.4 cents to $1.359 a gallon, wholesale gasoline rose 0.3 cent to $1.296 a gallon and natural gas rose 1.6 cents to $2.181 per thousand cubic feet.
Average US rate on 30-year mortgages slips to 3.93 per cent — Average long-term U.S. mortgage rates edged lower this week for a third straight week. Mortgage buyer Freddie Mac said Thursday the average rate on a 30-year fixed-rate mortgage slipped to 3.93 per cent from 3.95 per cent a week earlier. The average rate on 15-year fixed-rate mortgages eased to 3.16% from 3.18%. The key 30-year rate was above its level of a year ago, 3.89 per cent. Despite the recent declines, the rate has increased significantly overall since the end of October, when it stood at 3.76%.
US factory orders rise in Oct., ending streak of declines — U.S. factory orders rebounded in October after two prior monthly declines, helped by rising demand for aircraft, computers and machinery. Factory orders rose 1.5% in October, the Commerce Department said Thursday. This follows monthly declines of -0.8% in September and -2.1% in August. Factory orders have tumbled 7.1% year-to-date.
Citigroup: The Best Predictor of a U.S. Recession Will Resurface Sooner Than You Think “Not much holiday cheer is going around some of Citigroup's research teams. Chief Economist Willem Buiter's base-case scenario is for a global growth recession in 2016. And according to the bank's G10 rates strategists, the most reliable harbinger of an economic downturn is poised to rear its ugly head in the U.S. ‘Curve inversion will likely come more quickly than the consensus thinks,’ wrote the team.” (Bloomberg)
$6B in New Bonds Expected from McDonald’s “McDonald's (MCD -0.8%) is expected to announce new debt issuance of as much as $6B. Sources say the company is considering selling the debt in five different parts. The move by McDonald's, which would follow shortly after a record $4.3B in debt issued last May, could draw out some revisions from ratings agencies. Moody's and S&P Ratings have already expressed concerns on the financial policies of the restaurant operator.” (Seeking Alpha)
Prokhorov Said to Agree on Terms to Purchase 100% of Nets, Barclays Center “Mikhail Prokhorov and real estate developer Bruce Ratner’s Forest City Enterprises Inc. have reached an agreement that will give the Russian billionaire sole ownership of the Brooklyn Nets and Barclays Center, according to two people with direct knowledge of the talks. The National Basketball Association is reviewing the deal, the terms of which weren’t disclosed.” (Bloomberg)
Deutsche Bank Shows the Door to the Old Guard and Reshuffles the Rest of its Team “The loss of key executives, the perceived lack of accountability and the series of regulatory and legal investigations have taken a toll on the collective psyche of employees at the bank, according to former employees and reports from outside investors. An annual in-house survey of employees taken in June by Deutsche Bank exposed the extent to which employee morale had been sapped.” (Commercial Observer)
What You Should Know About Community Banks Loaded With Commercial Real Estate Loans “Community banks provide funding for community development and home building on Main Street USA. The broad category of real estate lending, known as commercial real estate loans, are divided into two categories: construction and development loans and nonfarm/nonresidential real estate loans. Back in the fall of 2005, the Federal Reserve, U.S. Treasury and the FDIC realized that community banks were lending funds to the housing and real estate markets at a pace above what these regulators thought as prudent.” (The Street)
How Crowdfunding Has Changed Real Estate Investing “Crowdfunding has become something of a buzzword among investors these days and it’s been particularly well received in the real estate sector. Though it’s still in its infancy, real estate crowdfunding is rapidly reshaping the way individuals find and invest in properties. This shift has brought benefits not only for investors but also for real estate companies and for the real estate market as a whole. But this rapid growth also means important considerations for investors when choosing a platform to invest their capital with.” (Forbes)
U.S. Steel Sued by Real Estate Firm “A real estate firm hired by U.S. Steel to sell a company-owned condominium in tony Ligonier is suing the struggling Pittsburgh steel producer after it refused to accept two all-cash bids well in excess of the list price. Berkshire Hathaway HomeServices is seeking the $31,800 commission it would have earned if U.S. Steel had accepted the top bidder’s offer of $636,000, according to a lawsuit the real estate firm filed in Allegheny County Common Pleas Court on Oct. 16.” (Pittsburgh Post-Gazette)
Landlords Saying Bah Humbug On Deluge of Packages “At Bailey's Crossing, a luxury rental apartment building in Alexandria, Virginia, delivery people from UPS, Federal Express, Amazon and the U.S. Postal Service are parading in with the carts overflowing from Cyber Monday shopping. They will not, however, bring all those packages, large and small, up to the tenants or to the building's front desk. There are simply too many. With online shopping now making up at least 10 percent of all retail, apartment building mailrooms are bulging, and landlords are balking.” (CNBC)
There’s No End in Sight to Sears’ Huge Sales Drop “Sears tried to downplay the poor showing, saying half the decline in the comparable sales was from apparel and consumer electronics—categories that offer low margins. That’s true, but the problem for Sears, like other department stores and general merchandise retailers, is that those segments still represent a huge percentage of sales, so in essence, the company is saying its basic business still stinks.” (Fortune)
Landlords Illegally Turning Away Renters on Government Aid, Says Stringer “The New York City comptroller says some landlords illegally refuse to rent to tenants who get government aid. Comptroller Scott Stringer made the announcement Tuesday. The Daily News says Stringer called on the city's Commission on Human Rights to go after landlords who openly ignore a 2008 law. The law bars landlords from discriminating against tenants based on their lawful source of income.” (The Associated Press)