iCrowdNewswire Jan 26, 2021 3:41 PM ET
The global pandemic shattered the world order and the US economy suffered its biggest blow since the Great Depression in the second quarter. Although the housing market briefly hit a pause in spring due to uncertainty and widespread stay-home orders, 2020 was still a record-breaking year in the residential real estate market. Despite the pandemic-induced recession, house prices in all the major markets continue to rise. According to economists and market watchers, the residential real estate sector has been highly supportive of the economic recovery of the country so far. It has emerged as a pillar of support for the economy. Although millions were laid off or furloughed it didn’t prevent house hunters from buying homes across the nation. As a result, the housing market saw the highest pace of sales growth since the height of the unprecedented housing boom in 2005. Active Companies in the markets today include Presidio Property Trust, Inc. , Toll Brothers, Inc. , Lennar Corporation , VORNADO REALTY TRUST , SL Green Realty Corp. .
That expansion was driven by negligent lending in the subprime mortgage market and the current housing boom is driven by the intense demand and record-low mortgage rates. Both of these factors were driven by the coronavirus pandemic. Housing prices had already started rising before the pandemic arrived but the pandemic created a rapid acceleration in double-digits. The housing market has seen record-breaking growth since June after briefly put on hold during the outbreak of the pandemic this spring. As prices keep climbing month-over-month, it just shows the resilience of the US housing market in the face of an ongoing economic recession. A report from IBISWorld sad that the market size, measured by revenue, of the Real Estate Sales & Brokerage industry will reach $164.8 Billion in 2021 and expected to increase 0.7% during 2021. It said that: “The market size of the Real Estate Sales & Brokerage industry in the US increased faster than the economy overall… (and) the market size of the Real Estate Sales & Brokerage industry in the US increased faster than the Real Estate and Rental and Leasing sector overall.”
Presidio Property Trust, Inc. BREAKING NEWS: Presidio Property Trust Reports 2020 Model Home Sales Activity – Presidio Property Trust, Inc, an internally managed, diversified real estate investment trust, announced today that, through its affiliated entities, it sold 46 model homes during 2020, and had eight homes for sale in escrow at year-end. 100% of the homes sold in 2020 resulted in a positive investment return. Home sold in 2020 were located in the states of Texas, Florida, Arizona, California, Wisconsin, and Pennsylvania. The average sales price per model home sold was approximately $400,000, and the average holding period was approximately 3 years.
“Our model home business delivered solid performance in 2020,” said Jack Heilbron, President and Chief Executive Officer. “We saw positive model home returns in all geographies and averaged a sale of almost one home per week throughout the year,” said Heilbron. “We collected 100% of the lease payments that we billed to our homebuilder tenants in 2020, showing the strength of the purchase / leaseback model home business, even in the time of COVID. Amortizing mortgages on these properties, coupled with a 3-year holding period, further reduces our risk.”
“Companies such as Hewlett Packard, Oracle, and Tesla chose to move to more business-friendly, lower-tax environments in 2020,” remarked Larry Dubose, President of Dubose Advisors, which manages and operates the purchase / leaseback model home business and is a wholly-owned subsidiary of Presidio Property Trust. “With a more reasonable cost of living and more affordable quality housing options, we are not surprised that the U.S. Census Bureau’s 2020 population estimates are that Texas had the highest population growth of any state. Having the bulk of our business in Texas and Florida, we expect the larger American population trends to translate into continued strong demand for housing in our core markets.” For more information about Presidio Property Trust please visit https://presidiopt.com/
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