“If a year was tucked inside of a clock, then autumn would be the magic hour.” – Victoria Erickson

Do you have any fun plans for Fall this year? Whether you enjoy pumpkin picking or hayrides, remember to take a moment to experience the season.

The month of spook-tacular surprises, cozy sweaters, and pumpkin spice everything! We’re falling for all things autumn in this edition of our newsletter. Get ready for some ‘boo-tiful’ updates, ‘gourd’-eous stories, and ‘witch’-ful thinking as we navigate through this enchanting October together!

• Luxury retailers have leased 650,000 sf of new space in the U.S. over the past 12 months, up from roughly 250,000 sf the prior year.

• Known for its young and fit population, Colorado – with 300 sunny days per year and tons of hiking and walking trails – has the US’s lowest diabetes rate, 8.1% as of 2022 along with Alaska, Montana, New Hampshire, Utah and Vermont. The American Diabetes Association put the economic cost of disease at $327BN per year in the US. West Virginia, Kentucky, Alabama, Misisssipi, Arkansas, Tennessee, Florida, Louisiana and Delaware are seeing the biggest escalations in diabetes.

• The average car’s weight has increased from 1.5 metric tons in 1974 to nearly 2 metric tons in 2023 as cars grow in size and electric batteries weigh lots too…..10 million EV’s (including hybrids) were sold in 2022. Older parking garages often do not have the structural needs to carry this weight. The TOP 3 selling vehicles in the US – the FORD F-150, Chevy Silverado and Dodge Ram – all weigh upwards of 4,000 lbs. As does a Tesla Y.

• A report published in the Journal of Photovoltaics showed that emissions-free electricity generation represents about 38% of the global mix as of the end of 2022. The 38% mix is represented by solar, wind, hydroelectric, nuclear, and other non-emitting sources. Non-fossil sources represented 85% of new capacity additions worldwide, and solar accounted for about two-thirds of that total. Solar alone contributed 56% of global capacity additions. In 2022 alone, 25% of the world’s cumulative global solar capacity was installed. The technology moved from 3.6% of the total electricity generation mix to about 4.5% in 2022, (PV Magazine)

• Ticketmaster sold over 295 million event tickets in the first 6 months of 2023, up nearly 18% year-over-year, as many consumers opted to spend on vacations and experiences instead of saving for bigger purchases….like homes. Bloomberg calculations show that the poorest 80% of the US population now have less cash on hand than they did before Covid. (WSJ)

• By the end of this year, more than 1.2 million new rental apartments will have been built in the US since 2020, with nearly 1 million more expected in 2024 and 2025. Among 296 U.S. metro areas studied, the New York area is projected to have by far the most new rental units completed in 2023, 33,001. Dallas expects 23,659 new rental apartments to be completed this year (bringing its 3-year total to just over 100,000, the most of any metro during that period), followed by Austin, 23,434, and Miami 20,906 which also has the greatest demand among all metro areas studied, with an average of 24 renters competing for each apartment. (NY TIMES)

We seem to thrive on averages in the world of real estate. A sobering average many are just beginning to acknowledge is that the 30 Year fixed mortgage rate in the US averaged 7.74% from 1971 until 2023, reaching an all time high of 18.63% in October of 1981 and a record low of 2.65% in January of 2021. That is a wide, wide spread that shows how just like all averages, everything in real estate is hyper-specific, not just hyper-local.

Sometimes when driving to my weekend house in traffic, I bemoan the times we are moving at 3 mph…..followed then by the times I speed along at 60 mph. As I turn off the car upon arrival, it shows my average speed was 32 mph……

In 1981 while rates hit that all time high of 18.63%, they averaged 16.63% that year. By 1986 they averaged down to 10.19%. While these sudden and relatively short bursts of higher rates have happened, we forget that in 2018, the 30-year averaged 4.54%…. 2021 was an anomaly. A highly unusual year. The ultra-cheap money was cheap to offset the damage of COVID lockdowns, the massive recession that hit in 2020.

In 2018, US GDP grew by 2.95%. In 2019, it pulled back to 2.29%. 2020 saw a 2.77% dip…..followed by a 5.95% surge in 2021 and a more sober 2.06% in 2022……averaged over 5 years, GDP grew by 2,096%. On an economy the size of the US (almost $27 TRILLION), 2% is BIG. We often forget just how large the US economy is. Looking back at this 5-year period, the average is rather dull. Look at the ups and downs and they are DRAMATIC!

No-one knows what comes next, whether rates stay higher for longer, or dip next year, or whether a recession hits next year or the following year….. looking back at the past 5 years we should see that the huge spikes and dips that inevitably happen usually don’t last too long, and certainly not forever. Is 8% the new normal? I have no idea. But take one more look at the average for the past 50 years and one thing is certain: 18.61% is NOT normal or permanent….and neither is 2.65%!