With the town of Basalt looking to acquire more property for affordable housing, local officials also want to bring on a professional real estate broker to assist with those future transactions.
Last Tuesday, Basalt voters overwhelmingly supported increasing the town’s debt by $18 million — with a maximum repayment cost of approximately $23 million — in order to increase the town’s supply of affordable housing, complete infrastructure improvements on Midland Avenue and finance green projects like vehicle charging stations.
“We really went the extra mile to reach out to the public to make sure people understood it and understood the rationale for it,” Basalt Mayor Bill Kane said Monday concerning ballot issue 3A’s passage. “I think it paid off. It got pretty strong support from our voters.”
With millions more in the pipeline for future town projects, and a healthy percentage already earmarked for affordable housing property acquisitions, town staff has requested hiring a real estate broker.
“For the land deal side of this, we’re going to need help from a local real estate agent,” Kane said.
Basalt Town Manager Ryan Mahoney said the town issued an request for proposals for real estate broker services several weeks ago but that it garnered only two responses, including one from Ted Borchelt of Sotheby’s International Realty.
Staff has recommended that a contract with Borchelt be approved during tonight’s regular council meeting.
Mahoney declined to comment on who else responded to the town’s RFP seeking real estate brokerage services.
If approved by council and ultimately hired by the town, Borchelt would earn a commission of between 5-6% on real estate transactions.
“We may be doing some property acquisitions and these are properties that are yet to be known or identified,” Mahoney said. “Using the services of a Realtor, in this instance, makes some sense for the town.”
Borchelt declined to comment for this story.
Last December, the Basalt Town Council approved spending $1.6 million on just over 1 acre of land off Highway 82 near Willits to accommodate the town’s new public works facility. At the time, the town did not hire a real estate broker but instead relied upon Town Attorney Jeff Conklin and members of its public works and planning departments to facilitate the sale.
“From a town perspective, it’s pretty normal for attorneys to do land transactions,” Mahoney said. “I would defer to the expertise of our public works director to know what they want and what they need.”
Mahoney stood by the town’s previous decision to purchase the Shelton property but said moving forward — pending council approval — a real estate broker would be utilized in instances concerning affordable housing property acquisitions.
Mahoney also denied that the town was bringing on a real estate broker in response to criticisms over the Shelton property purchase. Instead, Mahoney said it was directly related to 3A’s passage.
“These ‘real estate 101’ norms just were not followed in the [Shelton property purchase],” Stacey Craft, a real estate adviser with Engel and Volkers, said Monday. “A broker and a lawyer complement each other in a [real estate] purchase. But, a lawyer is a lawyer and a real estate agent is a real estate agent and we’re not supposed to cross lines.”
Councilman Bill Infante — the only councilmember to have previously opposed the new public works facility site purchase — believed better properties existed and for significantly less money. At the time, the town’s public works department operated out of a 1-acre space on Fiou Lane in east Basalt.
“You don’t hire a broker unless you’re buying property. So, I suppose there is a proposal to buy property,” Infante said Monday of the town’s new desire to hire a broker. “If this is somehow related to affordable housing, then I think there is going to be a long debate.”
Infante was critical of what he believed to be a lack of specificity in the ballot issue 3A and hoped the town would utilize extreme due diligence on any future property purchases.
He has long been an opponent of the town, itself, operating affordable housing.
“Our experience has been very, very poor and I would use that as the evidence why we should leave to the private sector what the private sector does very well,” Infante said. “We should stick to the purposes for which we have a government which are to oversee, to regulate and to provide the laws that guide private action.”
Red-hot Canadian property market to lose some steam in 2022: Reuters poll
Canada‘s double-digit house price inflation will lose steam next year, but affordability is still almost certain to worsen in one of the world’s hottest property markets, according to a Reuters poll of analysts.
A rush to purchase homes ahead of expected increases in Canadian interest rates https://www.reuters.com/world/americas/bank-canada-q3-2022-rate-hike-expected-q2-rise-possible-2021-12-03 next year is boosting the housing market in the final quarter, with prices skyrocketing 18.2% https://www.reuters.com/article/canada-economy-housing-idCAKBN2I01EP in October compared to the year-earlier period.
Extra froth in the market, driven by investors fueling perceptions that prices will keep rising, has prompted the Bank of Canada https://www.reuters.com/markets/us/canadas-housing-market-higher-risk-correction-says-bank-canada-2021-11-23 to recently warn of an increased risk of a correction.
“Affordability is unlikely to improve next year as prices should march higher, even as interest rates creep upwards as well,” said Rishi Sondhi, economist at TD Economics, who expects house price inflation to slow considerably next year.
“We think rate hikes will weigh on, but not upend, demand, as the macro backdrop should remain supportive for sales.”
Average house prices in Canada are expected to rise 18.6% this year, up from a 16.0% rise predicted in an August poll.
But those increases were forecast to slow significantly, to 5.0% in 2022 and 2.0% in 2023, according to the poll of 15 market analysts which was conducted from Nov. 17 to Dec. 6 and released on Tuesday. That compared to rises of 3.2% and 2.6%, respectively, in the August poll.
Only two respondents expected prices to fall in 2023, and by modest amounts.
Asked what would have the biggest impact on house prices next year, nine of 14 respondents said higher interest rates or tighter monetary policy. The remaining five cited supply constraints.
A follow-up question on how many basis points of interest rate hikes would significantly slow housing market activity had a median forecast of 100, with predictions in a range of 75 to 175 basis points.
Canada‘s central bank is expected to start raising interest rates by the end of the third quarter https://www.reuters.com/world/americas/bank-canada-q3-2022-rate-hike-expected-q2-rise-possible-2021-12-03 next year.
“One or two rate increases is unlikely to have a meaningful impact, but if we see four or more rate increases in 2022, this should take some demand out of the market, especially from interest rate-sensitive investors,” said John Pasalis, president of brokerage and research firm Realosophy Realty.
For many first-time home buyers, prices have climbed beyond their reach and a supply shortage of housing units has only aggravated their woes.
“Investors, house ‘flippers,’ and speculators, who according to the Bank of Canada account for over 20% of home purchases, have aggravated the severe demand-supply imbalance, boosted prices even higher and made housing more vulnerable to a correction,” said Tony Stillo, director of economics for Canada at Oxford Economics.
All 15 analysts who answered a question about affordability over the next two to three years said it would worsen.
“Out-of-reach housing prices will invariably lead more Canadians to rentals, especially if they have to live close to where they work. However, people who can work remotely will continue to migrate out of more expensive urban centres and ‘drive until they qualify,'” Stillo said.
(For other stories from the Reuters quarterly housing market polls:)
(Reporting by Swathi Nair; polling by Indradip Ghosh and Sarupya Ganguly; Editing by Ross Finley and Paul Simao)
Grand County real estate transactions, Nov. 28-Dec. 4 – Sky-Hi News
Grand County’s real estate transactions Nov. 28-Dec. 4 were worth more than $21.9 million combined.
• Valquero Subdivision Lot 2, Access Easement/Drainage Easement – Byersview Inc to Triton DG Granby LLC, DGGrand LLC, As Investments LLC, $2,050,000
• 448 Condominiums Unit 303 and Garage Unit 1 – Virga Corporation to Timothy Smith, $634,496
• Wells Minor Subdivision Lot MH-1A – Colton and Jeffrey Powley to Colorado Mountain Resorts Investors LLC, $381,741
• Fairways at Pole Creek PH 1 & Open Space Lot 4 23 – Linda and Donivan Ridgway Jr to Melissa and Joe Penn Jr, $2,480,000
• Eggert Subdivision Lot 5, Block 1 – Marjorie and Robert Noakes to Matthew Herron and Heidi Keyes, $412,250
• Fraser Crossing-Founders Pointe Condominium Unit 4470 – Copernicus LLC to Winter Park Drive 4470 LLC, $480,000
• 448 Condominiums Unit 101 and Garage Unit 5 – Virga Corporation to Jeffrey Vose, $725,944
• Roam Filing 1, Lot 18, Block 5 – Ski Idlewild Property LLC to Hunt Vac Services LLC, $950,000
• Zephyr Mountain Lodge Condo Bldg 1 & 2, Unit 2605 – Scott and Kimberly Balfanz to Scott and Anne Steputis, $850,000
• Zephyr Mountain Lodge Condo Bldg 1 & 2, Unit 2401 – Erik Amy LLC to Jeffrey McDonald, $579,000
• SEC 6 TWP 1N R 76W Partial Legal – See Document – Ellen Pacheco to Samuel and Monika Conger, $600,000
• Ptarmigan Subdivision Fraser Lot 102, Block MH – Fiona Russell to Derek Jotzat, $725,000
• Inn at SilverCreek PH 1, Condo Unit 322 – Glenda Sinardi and Parker Clonts to Charles and Lea Maxwell, $225,000
• Frontier Investment Company Addition to Kremmling Block 6, Lots 1,2,3 – Lodema Reinier, Lodema Cullum to Kelsy and Devin Ailport, $479,000
• Heinis Addition to Kremmling Block 1, Lots 5,7 – Benjamin and Kellie Steinle to Kristina Costa, $440,000
• Base Camp 9200 Second Replat Unit B2 – Sandhills Capital LLC to David and Marla Schmidt, $395,000
• Granby West Business Park Block 1, Lots 1,2 – Granby Industrial LTD Liability Co. to Elk Mountain Adventure Properties LLC, $300,000
• Mildred June Weaner Outright Exemption Lot J – Monarch Cabin LLC to Jerry Johnson, $430,000
• Rangeview Subdivision #2, Lot 33 – Randall Claeys and Stephanie Conners to Colin and Krystal Steward, $90,000
• Lake Forest 1st Addn Subdivision Lots 42,43,48,49; Laurent OE Lots A,B – Serge Laurent to Margaret J Blakley Revocable Trust, $800,000
• Meadow Ridge Lodges Court 7, Unit 9 – Eric Stanczak Jr to Rachael Watton, $580,000
• Muddy Creek Minor Subdivision TRT D – Muddy Creek Partners LLC to Areceli and Hugo Gonzalez, $325,000
• Bussey Hills Subdivision Block 7, Lots 7,14 – Michael Blasi and Arthur Aguilar to Heather and Michael Rinaldi Jr, $45,000
• Grand Lake Block 10, Lots 1,2,3 – GLL Real Estate LTD to McCarthy 401K Plan Trust, $1,150,000
• Rendezvous Center Condominiums Lot 3 – Rendezvous VC LLC, Koelbel Company to Brandon Kunz and Keith Jensen, $1,719,000
• Fraser Crossing-Founders Pointe Condominium Unit 3523 – FC 3523 LLC to Geoffrey and Rachel Nuwash, $485,000
• Crestview Place Condominiums Unit 604H – Debra and Robert Reehoorn to Beryl Foster and Robert Henry, $731,400
• East Mountain Filing 11, Lot 25 – Rendezvous Colorado LLC to Duncan, Peter and Suzanne Griffiths, Rochelle Rabeler, $1,465,904
• East Mountain Filing 10, Lot 138 – Rendezvous Homes LLC to Bawcom Living Trust, $1,424,366
Treasury wants more oversight of all-cash real estate deals – North Bay Business Journal
WASHINGTON (AP) — The Biden administration is looking to expand reporting requirements on all-cash real estate deals to help crack down on bad actors’ use of the U.S. market to launder money made through illicit activity.
The Treasury Department was posting notice Monday seeking public comment for a potential regulation that would address what it says is a vulnerability in the real estate market.
Currently, title insurance companies in just 12 metropolitan areas are required to file reports identifying people who make all-cash purchases of residential real estate through shell companies if the transaction exceeds $300,000.
“Increasing transparency in the real estate sector will curb the ability of corrupt officials and criminals to launder the proceeds of their ill-gotten gains through the U.S. real estate market,” said Himamauli Das, acting director of Treasury’s Financial Crimes Enforcement Network.
Das said the move could “strengthen U.S. national security and help protect the integrity of the U.S. financial system.”
The metropolitan areas currently facing reporting requirements are Boston; Chicago; Dallas-Fort Worth; Honolulu; Las Vegas; Los Angeles; Miami; New York City; San Antonio; San Diego; San Francisco; and Seattle.
The U.S. real estate market has long been viewed as a stable way station for corrupt government officials around the globe and other illicit actors looking to launder proceeds from criminal activity.
The use of shell companies by current and former world leaders, and those close to them, to purchase real estate and other assets in the U.S. and elsewhere was recently spotlighted by the International Consortium of Investigative Journalists’ publication of the “Pandora Papers.”
The leaked documents acquired by the consortium showed King Abdullah II of Jordan, former U.K. prime minister Tony Blair and other prominent figures used shell companies to purchase mansions, exclusive beachfront property, yachts and other assets for the past quarter-century.
The tax dodges can be legal but have spawned various proposals to enhance tax transparency and reinforce the fight against tax evasion.
The effort to push for new real estate market regulation comes as the Biden administration on Monday issued its “U.S. Strategy on Countering Corruption.”
The strategy was published as President Joe Biden prepares to host the first White House Democracy Summit, a virtual gathering of leaders and civil society experts from more than 100 countries that is set to take place Thursday and Friday.
The strategy offers broad brushstrokes for confronting corruption at home and abroad. It includes calls for the U.S. government to shore up regulatory gaps, elevating anti-corruption in U.S. diplomatic efforts and bolstering the protection of civil society and members of the media, including investigative journalists, who expose corruption.
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