Happy Friday! Today is National Junk Food Day. No. Just, NO.

1 big thing: Biden goes after rental junk fees

As announced by the White House on Wednesday, the Biden administration is taking steps against junk fees on behalf of renters as they’ve done for hotel guests and airline passengers.

Folks are tired of being played for suckers.

– President Biden at Wednesday’s meeting of his Competition Council

State of play: Florida has no limit on what landlords can charge for an application fee. Tenants nationwide are reporting that they’re being charged high application fees for background checks, plus additional fees for mail sorting, trash pickup, and other services that weren’t disclosed when they were deciding where they could afford to rent.

  • Rental application fees are running as high as $100 in some places, and — when tenants are applying for multiple locations with different management companies or landlords — the burden can be impossible to bear.

  • This compounds when the actual background check costs the landlord $20 or less to run, allowing the landlord or management company to make large profit margins by taking applications from multiple potential tenants for the same rental.

  • Some landlords require that rent be paid electronically and then charge tenants a “convenience fee” for accepting payments in that manner.

  • Some landlords are charging “January Fees” in addition to rent. No one is really sure what those cover.

To combat the effect of such fees:

  • Zillow, Apartments.com, and AffordableHousing.com have all agreed with the White House to disclose all upfront costs.

  • The White House is encouraging state legislatures across the U.S. to examine such fees being charged and pass legislation to regulate the practice.

  • And new research from HUD provides a blueprint for a nationwide effort to address rental housing junk fees.

The big picture: This is not the first time the Biden administration has taken on junk fees. With similar action from the Bully Pulpit, they have brought transparency to total costs for concert and event tickets, hotel charges, and airline fees.

  • No one agrees actually to eliminate or even lower the junk fees, and no laws are passed to prohibit them either.

  • The online sites that sell the services, however, agree to publish the fees upfront so consumers aren’t surprised later by the additional fees.

What’s the highest fee you’ve seen charged for a tenant application?

$100+
$50 – $100
$25 – $50
$0 – $25

Your response is anonymous

Do you think this is a good way to combat junk fees in any consumer industry?

Yes
No

Your response is anonymous

 

2. Economic good news

Chart - Bureau of Labor Statistics, US Dept. of Labor, July 12, 2023 (Pub. USDL-23-1523)

Economic numbers are great across the board, and it looks like that recession that we were fearing isn’t going to happen after all.

Why it matters: Overall, people feel good about their own finances but have an impending sense of doom about the rest of the economy. But is that feeling justified by the numbers?

By the numbers: Price stability is settling back to normal.

  • While prices are still high for some goods and services, inflation is about how quickly prices are rising.

  • In the past month, prices rose by 0.2%, a barely noticeable range for most consumers.

  • This comes in at an annualized 3% inflation rate which is one point above the 2% the Fed is charged with holding.

  • Layoffs have hit the media and technology sectors, but those sectors have the largest megaphones to broadcast the news of those layoffs, so they seem to be widespread. The national unemployment rate is 3.6%, which is the lowest it has been since 1969.

  • The rest of the economy is adding jobs, with over 209,000 created in June. And they’re good-paying jobs because of huge investments in infrastructure and manufacturing.

  • The monthly civilian labor force participation rate is at 62.6% as of June. That’s where it was right before the pandemic.

  • Americans’ bank accounts are an average of 10 to 15% higher than they were in 2019.

  • Consumer sentiment is at a 22-month high.

  • And compared to our counterparts in the rest of the G7, the United States is killing it economically.

Yes, but: The consensus is that the Fed will raise its lending rate again next week, but (we hope) this will be the last increase this year.

  • Some Fed members are concerned that — unless they cause a lot of people to lose their jobs — inflation will keep rising. This kind of thinking could drive us into a recession.

  • But as you can see from the numbers above, that’s not happening. Inflation is no longer increasing at the same rate it was, and numbers are as good or better than they were before the pandemic.

The bottom line: If the Fed can shake its belief that no recovery can occur without major job losses, then we can finally put behind us the previous recession that COVID caused.

Our thought bubble: Economic stability breeds confidence, and confidence stabilizes the housing market along with other sectors.

3. Catch up fast

4. Pic of the day

It's bug season in Orlando. At night, they buzz above the fountains, with the light making them appear to be a synchronized dancing column of teamwork.

Humility is one of the most important traits that a leader, entrepreneur, or anyone else can possess.

Why it matters: If a person is humble, they can accept and use:

  • feedback;

  • setback;

  • failure;

  • coaching;

  • others’ ideas.

More importantly, a humble person can admit mistakes, learn from them, and move forward. It breeds empathy.

Humble people use the words “we” and “our.” They’re not focused on “I’“or “me.” They share the spotlight and, more importantly, shine it on others around them.

The bottom line: Organizations are a reflection of those who lead them. Those led by people who embrace humility as a core cultural value tend to be some of the best places to work and thrive. They also generate happier customers and constituents.

We hope you found this helpful — any feedback is appreciated and can be shared by hitting reply or using the feedback feature below.

Be on the lookout for our next issue! 

Happy Friday! Today is National Junk Food Day. No. Just, NO.

1 big thing: Biden goes after rental junk fees

As announced by the White House on Wednesday, the Biden administration is taking steps against junk fees on behalf of renters as they’ve done for hotel guests and airline passengers.

Folks are tired of being played for suckers.

– President Biden at Wednesday’s meeting of his Competition Council

State of play: Florida has no limit on what landlords can charge for an application fee. Tenants nationwide are reporting that they’re being charged high application fees for background checks, plus additional fees for mail sorting, trash pickup, and other services that weren’t disclosed when they were deciding where they could afford to rent.

  • Rental application fees are running as high as $100 in some places, and — when tenants are applying for multiple locations with different management companies or landlords — the burden can be impossible to bear.

  • This compounds when the actual background check costs the landlord $20 or less to run, allowing the landlord or management company to make large profit margins by taking applications from multiple potential tenants for the same rental.

  • Some landlords require that rent be paid electronically and then charge tenants a “convenience fee” for accepting payments in that manner.

  • Some landlords are charging “January Fees” in addition to rent. No one is really sure what those cover.

To combat the effect of such fees:

  • Zillow, Apartments.com, and AffordableHousing.com have all agreed with the White House to disclose all upfront costs.

  • The White House is encouraging state legislatures across the U.S. to examine such fees being charged and pass legislation to regulate the practice.

  • And new research from HUD provides a blueprint for a nationwide effort to address rental housing junk fees.

The big picture: This is not the first time the Biden administration has taken on junk fees. With similar action from the Bully Pulpit, they have brought transparency to total costs for concert and event tickets, hotel charges, and airline fees.

  • No one agrees actually to eliminate or even lower the junk fees, and no laws are passed to prohibit them either.

  • The online sites that sell the services, however, agree to publish the fees upfront so consumers aren’t surprised later by the additional fees.

What’s the highest fee you’ve seen charged for a tenant application?

$100+
$50 – $100
$25 – $50
$0 – $25

Your response is anonymous

Do you think this is a good way to combat junk fees in any consumer industry?

Yes
No

Your response is anonymous

 

2. Economic good news

Chart - Bureau of Labor Statistics, US Dept. of Labor, July 12, 2023 (Pub. USDL-23-1523)

Economic numbers are great across the board, and it looks like that recession that we were fearing isn’t going to happen after all.

Why it matters: Overall, people feel good about their own finances but have an impending sense of doom about the rest of the economy. But is that feeling justified by the numbers?

By the numbers: Price stability is settling back to normal.

  • While prices are still high for some goods and services, inflation is about how quickly prices are rising.

  • In the past month, prices rose by 0.2%, a barely noticeable range for most consumers.

  • This comes in at an annualized 3% inflation rate which is one point above the 2% the Fed is charged with holding.

  • Layoffs have hit the media and technology sectors, but those sectors have the largest megaphones to broadcast the news of those layoffs, so they seem to be widespread. The national unemployment rate is 3.6%, which is the lowest it has been since 1969.

  • The rest of the economy is adding jobs, with over 209,000 created in June. And they’re good-paying jobs because of huge investments in infrastructure and manufacturing.

  • The monthly civilian labor force participation rate is at 62.6% as of June. That’s where it was right before the pandemic.

  • Americans’ bank accounts are an average of 10 to 15% higher than they were in 2019.

  • Consumer sentiment is at a 22-month high.

  • And compared to our counterparts in the rest of the G7, the United States is killing it economically.

Yes, but: The consensus is that the Fed will raise its lending rate again next week, but (we hope) this will be the last increase this year.

  • Some Fed members are concerned that — unless they cause a lot of people to lose their jobs — inflation will keep rising. This kind of thinking could drive us into a recession.

  • But as you can see from the numbers above, that’s not happening. Inflation is no longer increasing at the same rate it was, and numbers are as good or better than they were before the pandemic.

The bottom line: If the Fed can shake its belief that no recovery can occur without major job losses, then we can finally put behind us the previous recession that COVID caused.

Our thought bubble: Economic stability breeds confidence, and confidence stabilizes the housing market along with other sectors.

3. Catch up fast

4. Pic of the day

It's bug season in Orlando. At night, they buzz above the fountains, with the light making them appear to be a synchronized dancing column of teamwork.

Humility is one of the most important traits that a leader, entrepreneur, or anyone else can possess.

Why it matters: If a person is humble, they can accept and use:

  • feedback;

  • setback;

  • failure;

  • coaching;

  • others’ ideas.

More importantly, a humble person can admit mistakes, learn from them, and move forward. It breeds empathy.

Humble people use the words “we” and “our.” They’re not focused on “I’“or “me.” They share the spotlight and, more importantly, shine it on others around them.

The bottom line: Organizations are a reflection of those who lead them. Those led by people who embrace humility as a core cultural value tend to be some of the best places to work and thrive. They also generate happier customers and constituents.

We hope you found this helpful — any feedback is appreciated and can be shared by hitting reply or using the feedback feature below.

Be on the lookout for our next issue! 

About Emily Robertson

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So far Emily Robertson has created 61 blog entries.

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By Joseph E. Seagle, Esq.

👋 Happy Friday! Today is National Endangered Species Day. My favorite formerly-endangered species in Central Florida is the beloved 🦭 manatee. If you haven’t visited a local spring lately, today is a great day to see a manatee.

 

Situation Awareness: Hudreds of Florida real estate lawyers, including yours truly, are attending the Fund Assembly today to get our CLE credits and learn the latest changes in real estate title laws. So if you’re having trouble getting information about a pending closing, this could be why. Fear not, we’ll return to the office on Monday refreshed and better educated.

 

1 big thing: OK, Boomer … sell your house?

Photo: James Hose, Jr.

The Boomer Generation (those born between 1946 and 1964) is the second largest living generation in the U.S., behind the Millennial Generation. But they’re the largest generation of home buyers.

Why it matters: Boomers are also the largest living generation of home sellers, providing a potential middle road in the housing supply chain between new home construction and existing home sales.

How it works:

  • Boomers are unfettered by a mortgage on their current home, having paid them off.
  • They can live anywhere they prefer, seeking out the lowest-cost areas to maximize their retirement funds.
  • Likewise, with the equity they have in their homes, they can often sell their existing home and have plenty of money to buy a smaller home with fewer maintenance demands.
  • And they don’t need a mortgage for that purchase, so interest rates are irrelevant.

Mortgage rates have increased by five points in the past 14 months. Over 50% of homeowners have little incentive to sell because they refinanced into low rates before the increases started.

  • As such 82% of homeowners feel “locked into” their homes because of their current mortgage rate versus what they’d face in a new purchase.

 

  • Boomers, most with no mortgage, aren’t locked into anything and are free to sell and move, opening up a potential supply of homes for other buyers, and a stream of customers for REALTORs who understand what this generation wants in a new home.

 

Yes, but: Baby Boomer mortality rates are estimated to have little effect on housing supply.

More than 4 million existing homes for sale annually over the next decade will come from the aging and mortality of older homeowners.

As of 2019, Boomers owned 32 million homes in the U.S.

Boomers downsizing often compete with Millennials, looking for a home that would be the downsized Boomer’s home but a starter home for the Millennial.

The bottom line: Boomers’ mortality and aging may not generate enough available homes for sale. But downsizing could add to the number of available homes, helping Millennials and other generations to upsize. But robust new construction numbers will be the primary driver of lower prices.

 

2. Prices continue to rise

Illustration: Dall-E

Almost 70% of all metro areas saw home price gains in the first quarter, while 31% — the largest number in decades — saw price declines.

Why it matters: While there is no national housing market because all real estate is local, it helps to watch the national overall numbers on a macro level to indicate where the overall economy could be heading.

By the numbers: Over the past quarter,

  • Mortgage rates ranged between 6.1% and 6.7%
  • The median price of an existing single-family residence dropped by 0.2% to $371,200.00. In the previous quarter, it had increased by 4% year-over-year.
  • Housing affordability improved a bit. The monthly mortgage payment was $1,859, a 5.5% decrease from the previous quarter.

Yes, but: That’s a jump of 33.1% ($462) from Q1 2022.

  • Homeowners spent 24.5% of their income on mortgage payments, up from 19.5% last year at the same time.
  • Mortgages are considered to be unaffordable if payments exceed 25% of the borrower’s income.

State of play: Inventory is still down 40% less than what it was in Q1 2019, a year before the pandemic began, and housing construction starts tumbled last month suggesting that there’s not near-term solution to the lack of inventory.

What they’re saying: With inventory down, multiple offers are not unheard of on affordable homes, especially in the South where sales are stronger than in other parts of the country. Therefore, these price declines are expected to be “short-lived.”

Go deeper: National Association of REALTORs 

3. Catch up fast

  1. Orlando was one of America’s fastest-growing metros in 2022. Orlando Sentinel
  2. Big companies not returning to big office buildings aren’t just hurting their big landlords. It’s also hurting the small businesses that grew up to serve the office workers. NPR
  3. A Cape Coral title agent was sentenced to 46 months in federal prison last week. US Attorney’s Office

4. Pic of the day

Disney announced that it’s closing its Star Wars: Galactic Starcruiser Hotel and Experience at the end of September. Still, this modern version of “R2-JEEP2” charging nearby at the Hilton Signia Hotel parking garage will turn heads long after the Starcruiser goes into dry dock.

We hope you found this helpful — any feedback is appreciated and can be shared by hitting reply or using the feedback feature below.

Have an idea or issue to share? Email us. Be on the lookout for our next issue! 👋

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