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Manhattan is now a ‘buyer’s market’ as real estate…

3 July 2024
by admin

Manhattan real estate showing signs of becoming a buyer's market

Manhattan is becoming a buyer’s market as apartment prices fell and inventory rose in the second quarter of 2024, according to new reports.

The average real estate sales price in Manhattan fell 3% to just more than $2 million, according to a report from Douglas Elliman and Miller Samuel. The median price fell 2% to $1.2 million, and prices for luxury apartments fell for the first time in more than a year, according to the report.

The price declines are a result of rising inventory of apartments for sale, which are also taking longer to sell. There are now more than 8,000 apartments for sale in Manhattan, which is higher than the 10-year average of about 7,000, according to Jonathan Miller, CEO of Miller Samuel, the appraisal and research firm.

Manhattan now has a 9.8 month supply of apartments for sale, which means it would take 9.8 months to sell all of the apartments on the market without any new listings, according to Brown Harris Stevens. “Any number over 6 months tells us there is too much supply and we are in a buyer’s market,” according to the Brown Harris Stevens report.

The falling prices and rising number of unsold apartments in Manhattan stand in contrast to the national real estate landscape, where continued tight supply continues to keep prices high. Brokers and real estate analysts say the strong prices in Manhattan post-Covid became unsustainable, and both buyers and sellers are finally capitulating to a higher interest rate environment.

The sun sets on the skyline of midtown Manhattan and the Empire State Building in New York City, as seen from Jersey City, New Jersey, on April 23, 2023.

Gary Hershorn | Corbis News | Getty Images

“The buyers and sellers resolve is weakening,” Miller said. “At a certain point, they can only wait so long before they feel like they have to make a move.”

With the gap narrowing between buyer and seller expectations, more deals are closing. There were 2,609 sales in the second quarter, up 12% from a year ago, according to the Douglas Elliman and Miller Samuel report. That marked the first sales rebound in two years.

“As the second quarter began, New York’s real estate market awakened from the doldrums in which it had languished for the first quarter of 2024. Deals in all price categories began to emerge,” said Frederick Warburg Peters, President Emeritus of Coldwell Banker Warburg.

High rents in Manhattan are also continuing to help sales. The average apartment rental price in May was still upward of $5,100 a month and rents tend to rise in the late summer. Many potential buyers who were waiting out the sales market in rentals are finally deciding to buy, hoping interest rates will start to come down at the end of 2024 or early 2025.

“If people were sitting on the fence, the high rents maybe helped push them into the sales market,” Miller said.

Still, mortgage rates have a more muted effect on Manhattan real estate than the rest of the country since most Manhattan sales are in cash. In the second quarter, 62% of deals were all cash.

While prices fell for all segments of the Manhattan real estate market, the high end is among the weakest, as the wealthy hold off on purchases until after the uncertainty of the elections. The median sale prices in the luxury segment — or the top 10% of the market — fell 11% in the second quarter, according to Miller Samuel. Listing inventory of luxury apartments surged 22%.

“With the high end, this weakness could be the beginning of a trend or just a one-off,” Miller said. “We will have to see what happens in the second half.”

Science & Environment

PSX surges 252 points, continues bullish trend | The…

27 June 2024
by admin

ISLAMABAD:

The Pakistan Stock Exchange (PSX) maintained its bullish momentum on Thursday, with the 100-index rising by 252.61 points, a 0.32 per cent increase, to close at 78,528.25 points. This is up from the previous day’s close of 78,275.65 points.

The trading volume for the day was 283.54 million shares, down from the previous day’s 469.76 million shares. The total value of traded shares stood at Rs11.067 billion, compared to Rs19.777 billion on the last trading day.

A total of 426 companies traded their shares on the stock market. Of these, 211 recorded gains, 150 suffered losses, and 65 remained unchanged.

Read PSX faces post-budget pressure

The top three trading companies were:

WorldCall Telecom: 27.56 million shares traded at Rs1.25 per share.

K-Electric Limited: 21.97 million shares traded at Rs4.67 per share.

Oil and Gas Development Company: 16.93 million shares traded at Rs137.17 per share.

Among the top gainers, Unilever Pakistan Foods Limited saw the highest increase, with its share price rising by Rs104.99 to close at Rs18,396.67. Rafhan Maize Products Company Limited followed, with a Rs67.21 increase to Rs7,650.00 per share.

Conversely, Fatch Industries Limited experienced the largest decline, with its share price falling by Rs11.86 to close at Rs122.54. Dawood Lawrencepur Limited was next, with a Rs7.39 decrease, closing at Rs212.00 per share.

Science & Environment

Cocoa prices are soaring. Candy makers will need to…

15 June 2024
by admin

Dried cocoa beans at the Somos Cacao farm and production facility in Ragonvalia, Norte de Santader department, Colombia, on Friday, March 22, 2024.

Ferley Ospina | Bloomberg | Getty Images

There’s pricing pressure taking hold of a specific corner of global agriculture — and it’s bittersweet.

Prices of cocoa have more than tripled over the last year, creating a big headache for candy makers and other food companies that use the ingredient to make chocolate.

In recent years, the price of cocoa had hovered at around $2,500 per metric ton. But reports of a weaker-than-expected crop set off concerns about supply, sparking the commodity’s run-up in recent months. Cocoa hit an all-time high of more than $11,000 per metric ton in April. The price surge has since eased off slightly, but the crop is still commanding well above what food companies are used to paying.

For now, many of the largest candy companies — Hershey, M&M’s maker Mars, Kinder owner Ferrero and Cadbury parent Mondelez — are likely protected from higher cocoa costs, thanks to long-term contracts that lock in the prices they pay for key commodities to protect them from events just like this. That gives them some lead time to grapple with the issue. But come 2025, they’ll likely end up paying much more for their cocoa.

“This is absolutely impacting the ways in which these companies are managing their businesses, just because the cost impact is so incredibly significant,” said Steve Rosenstock, the consumer products lead at Clarkston Consulting, which advises clients on how to deal with problems such as the soaring cost of cocoa.

Mars declined to participate for this story. Mondelez, Ferrero and Hershey did not respond to CNBC’s requests for comment.

Costly cocoa

West Africa, which grows the majority of the world’s cocoa supply, has been hit by crop disease and lower prices paid to farmers at the point of sale, called farmgate pricing, that push them to grow more lucrative crops such as rubber instead of cocoa. This season’s cocoa crop is expected to experience the largest deficit in at least six decades, according to a Rabobank report from May.

Reuters reported Wednesday that Ghana, the second-largest cocoa producer, is looking to delay a delivery of up to 350,000 tons of beans to next season, sending prices higher again.

A worker picks cocoa fruit at the Somos Cacao farm in Ragonvalia, Norte de Santader department, Colombia, on Friday, March 22, 2024.

Ferley Ospina | Bloomberg | Getty Images

On recent earnings calls, executives from Mondelez and Hershey said they believe market speculation is driving at least some of the surge in cocoa. Prices could come down in September, once more information about the new crop is available — but that doesn’t mean that they’ll return to normal.

The commodity’s climbing cost comes at a tough time for many food companies. Over the last two years, many have raised prices to deal with inflation that touched on a broader array of commodities. As a result, shoppers have become choosier about what they buy and more dissatisfied with the prices they see at grocery stores. Consumers’ focus on value leaves candy companies with little leeway when it comes to pricing to cope with cocoa’s higher cost.

And then there’s shrinkflation, a buzz word that has entered the layperson’s lexicon over the last two years. Companies will cut a product’s quantity or weight while the price stays the same. But consumers have gotten wise to the trick. A YouGov survey conducted in October found that 72% of U.S. respondents had noticed shrinkflation in food products.

Near-term workarounds

As a result, many companies will have to become more creative.

J&J Snack Foods CEO Daniel Fachner has been keeping an eye on cocoa and chocolate prices. The company owns brands including Dippin’ Dots, SuperPretzel and Hola Churros and manufactures products for other companies, such as Subway’s footlong churro. Chocolate is a common flavor in its portfolio, which includes treats such as a chocolate-filled churro.

“It won’t stop us from using chocolate, but it will cause us to think about and say, ‘Now, if we do this innovation with that new pricing, is it sellable?’ And then when we sell it, ‘Is it at a low enough cost that customer could sell it and still make a good margin?'” Fachner told CNBC in May.

One hypothetical solution, proposed by Fachner, could involve cutting back the number of chocolate chips from 12 to nine in a certain product. He also said J&J is looking for any possible substitutes that could work for some of its recipes.

Chocolates are displayed on a shelf at Celine’s Sweets in Novato, California, March 22, 2024.

Justin Sullivan | Getty Images

RBC Capital Markets analyst Nik Modi cited Hershey’s new Jumbo Reese’s Cup as one creative workaround.

“This one has extra peanut butter, so it’s a nice way of trying to get innovation into the market at a premium price, let the consumer feel like they’re getting value, but just changing the product itself to lower the reliance on chocolate,” he said.

For food companies that don’t primarily deal in chocolate, they might start avoiding the flavor, especially when it comes to new products.

“I think more or less, people will try to stay away from chocolate at this point,” Modi said.

The long tail of the cocoa crisis

Why the price of chocolate's key ingredient skyrocketed in 2024

While this year’s spike in cocoa prices has been historic, it likely won’t be the last time food companies find themselves paying more for the commodity. Analysts are already predicting another cocoa shortfall next year, although it would likely be less dramatic than this season’s.

However, systemic issues, such as government-controlled farmgate pricing, and climate change will likely keep hurting the beans’ crop. Plus, the use of child labor and slavery in West African cocoa farms has led to lawsuits and scandal for candy companies.

In the long term, that means many companies will have to look for more permanent solutions. In some cases, that may mean alternatives to cocoa.

“There are examples where companies are increasing the amount of non-cocoa additives, like sugar, more economical things like cocoa butter equivalents, shea butter, palm oil, coconut oil, those types of things,” Rosenstock said.

Justin Sullivan | Getty Images

Recipe reformulation takes about nine months on average, according to a research note published Thursday from Bank of America Securities analyst Antoine Prevot. He said he thinks fast-moving consumer goods companies have been looking at changing their formulas since the beginning of this year, which means the new candy could start trickling out as soon as August.

There are more extreme substitutes, too. Startups such as Voyage Foods and Win-Win have made cocoa-free chocolate using alternatives such as grape seeds and legumes.

At least one candy company isn’t planning any major changes to its formulas.

“We will do some cost tightening, but we’re not going to change recipes or do things that are not necessarily the right thing for the business in the long run,” Mondelez CFO Luca Zaramella said June 4 at a Deutsche Bank conference.

There’s also the potential for diversification with other kinds of snacks. When Kraft spun out Mondelez more than a decade ago, it already had Triscuit, Sour Patch Kids and Wheat Thins snacks in its portfolio, in addition to chocolate products Milka, Oreo, Toblerone and Chips Ahoy.

Other candy companies have followed its lead, adding more salty snacks to their lineups to drive more growth. For example, Hershey bought Amplify Snack Brands in 2017, adding SkinnyPop to its portfolio, and Dot’s Homestyle Pretzels in 2021.

“I don’t think they did it to be less dependent on cocoa — they did it to more easily react to the ups and downs of consumer trends and to be able to really diversify their portfolio,” Rosenstock said. “But the ability to lean on some of the non-chocolate categories, whether it’s salty snacks, jelly beans or gummy products, I think that’s a good way to combat the cocoa crisis.”

Science & Environment

The Covid-19 pandemic worsened a child care crisis, and…

8 June 2024
by admin

Vadym Buinov | Moment | Getty Images

The Covid-19 pandemic brought to the surface both cracks and resilience in the American economy, with child care taking center stage as day cares shuttered, schools went remote and parents attempted to juggle their children with their jobs.

While employment in the child care sector has made a post-pandemic return to baseline, according to the latest data from the Bureau of Labor Statistics, a shortage of workers and available slots for children in some areas is weighing on the sector.

Costs are also going up for families. A February report from Bank of America showed costs for families increased between 15% and nearly 30% in terms of the average child care payment per household, year on year, during the fourth quarter of 2023. The largest increase was seen among households with average incomes of between $100,000 and $250,000 annually.

Policy advocates argue that child care, including for infants and toddlers, is an economic issue that affects all Americans, not just those with young kids.

Billions in stabilization funds from the American Rescue Plan Act earmarked for the child care sector expired last fall, which could lead to increased costs for families or centers closing their doors.

ReadyNation, an advocacy group of more than 2,000 business executives, lobbies in support of policies and programs at both state and federal levels that support a strong workforce and economy, including child care.

The group released a report in 2023 that found the nation’s infant-toddler child care crisis costs the U.S. an estimated $122 billion in lost earnings, productivity and revenue every year. That is up from $57 billion in 2018, before the pandemic exposed and exacerbated holes in the system for working families and the companies that rely on them.

ReadyNation’s study found a combination of “Covid-19 and insufficient policy action have now significantly worsened the crisis.”

“All taxpayers are impacted by this. We need to realize that the loss of taxpayers is $1,470 every year per working parent because of lower income taxes being paid and lower sales taxes because of lack of purchasing power from people that are unemployed,” said Nancy Fishman, national director of ReadyNation.

Part of the nationwide solution is supporting what the group calls the “workforce behind the workforce” — early child care providers.

“Supporting the early childhood workforce could include such things as making sure child care providers have access to benefits. We all know how much benefits matter, whether it’s health-care benefits, or the ability for them to find high-quality child care for their own children,” Fishman told CNBC. “Programs that support additional training and education for child care providers are important as well.”

Solutions in the Golden State

In California alone, the economic toll including lost earnings, productivity and revenue is an estimated $17 billion, ReadyNation projects. That is higher than any other state in the country, according to the group’s estimates.

While child care jobs in the state have rebounded to a 2020 baseline as of this spring, according to analysis from the Center for the Study of Child Care Employment, other states have seen larger job gains post-pandemic.

Some child care workers in California organized in 2019, with the Child Care Providers United, which today represents more than 40,000 home-based licensed and license-exempt, friends and family, child care providers. The providers are a part of the state subsidy program in California, and the union is a partnership of SEIU Locals 99 and 521, as well as UDW/AFSCME Local 3930.

The group won its first contract in 2021 and gained access to first-in-the-nation retirement benefits.

The union says child care providers currently get reimbursed at a percentage of what it costs them to provide care in the state. Average child care provider pay is $7 to $10 an hour, with many providers reporting no take-home pay, it said.

Providers are currently advocating through the state budget process to be reimbursed for the full cost of providing care to create more dignity in their work, keep providers open and attract new providers to the workforce.

Deborah Corley-Marzett operates an in-home center for subsidized care in Bakersfield, California. She told CNBC she would like to hire more staff to help support her and the children, but it is difficult to find the right fit and offer competing wages in this environment. Low-wage workers in the state’s fast-food sector, for example, just secured a historic $20 an hour minimum wage, pressuring other sectors to keep up.

“I have a staff shortage problem. I literally can’t afford to hire someone to come in and work in the mornings with me right now. I can’t afford it,” Corley-Marzett said. “I don’t have enough children right now. But I can’t physically take on any more children.”

Lawmakers argue progress has been made, but there is more work to do. State Senator Nancy Skinner, a Democrat representing parts of the Bay Area and chair of the California Women’s Caucus, said the group continues to prioritize early child care and education. The group advocated for a $2 billion increase in the state’s spending over the course of the past two years toward early care and education, for a total of $6.5 billion.

The Caucus’ current focus is maintaining steady rate reimbursement rates for child care providers as the state stares down a budget deficit.

“We have low unemployment, but many sectors of the economy are looking for workers,” Skinner told CNBC. “If your family is in a situation where you can’t go to work because you don’t have adequate child care, or you can’t afford child care, then you cannot fulfill that job that’s sitting there, vacant and waiting for you.”

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Science & Environment

The Washington Post – Breaking news and latest headlines,…

27 November 2023
by admin

For Israelis, even an extended pause in the Gaza war does not mean peace

Science & Environment

Global investors’ confidence in Pakistan rises | The Express…

23 November 2023
by admin

KARACHI:

Pakistan has won back confidence of global investors as the country risk premium fell significantly from the peak of over 14% in June while its dollar-denominated Eurobond prices rose notably.

Topline Securities CEO Mohammed Sohail said on social media platform X “Pakistan’s country risk premium has fallen significantly from its peak of 14.13% on June 27, 2023 to the current level of 3.35%. This shows building investor confidence in Pakistan post-IMF standby arrangement (SBA).”

The reduction in risk premium signals the revival of global investors’ trust in Pakistan’s equity and debt instruments from the earlier negative stance.

On the other hand, prices of Pakistan’s Eurobonds worth $1 billion maturing in April 2024 surged to 94.08 cents from near 50 cents in June.

Prices of other Eurobonds and Sukuk also maintained their uptrend since the IMF awarded a $3 billion loan programme at the end of June 2023.

Talking to The Express Tribune, Pak-Kuwait Investment Company Head of Research Samiullah Tariq said the fall in risk premium and the improvement in Eurobond prices both suggested that there was no risk of default by Pakistan on foreign debt repayment as compared to high default fears before the SBA.

The government’s decision to let foreign investors in debt and equity markets move their funds in and out of Pakistan despite default risks, has helped revive their confidence.

Read: Pakistan’s Eurobonds jump to multi-year highs

Pakistan has also recently lifted restrictions on foreign companies operating in the country on fully repatriating profits and dividends to their headquarters abroad after improvement in the country’s foreign exchange reserves.

Such companies freely repatriated profits in October, which came after an unannounced moratorium over the past about 18 months.

Though the foreign exchange reserves are still low and financing from global creditors and international investors is not materialising, Tariq noted that the IMF executive board’s approval of the release of second loan tranche of $700 million would encourage other global creditors to unlock the promised funding.

He recalled that the UAE had assured the IMF about two weeks ago that it was committed to providing promised funds to Pakistan. In addition, multilateral and bilateral creditors have pledged around $10 billion in flood relief in Geneva in January 2023.

Published in The Express Tribune, November 24^th, 2023.

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Science & Environment

‘Economy to grow faster, inflation a worry’ – Times…

16 November 2023
by admin

MUMBAI: The momentum of GDP growth will be higher in the third quarter, but the economy is not yet out of the woods when it comes to inflation, according to an RBI report.
“The momentum of the change in GDP is sequentially expected to be higher in Q3 2023-24, with festival demand remaining ebullient. Investment demand appears to be resilient with the government’s infrastructure spending, an uptick in private capex, automation, digitalisation, and indigenisation providing a boost,” the ‘State of the Economy’ report said.
The report is positive on investment demand, which it described as ‘resilient’ with capital goods equity indices among the top performing sectoral indices. “… Capital expenditure by states has surged alongside that of the Centre,” the report said.
On inflation, it added, “We have miles to go, but readings of around 5% and 4.9% in September and October, respectively, are a welcome relief from the average of 6.7% in 2022-23 and 7.1% in July-August 2023.”
According to the report, there is not much cause for worry on the external sector front, given the modest current account deficit — financed by resilient capital flows and one of the ‘least volatile currencies in the world’ — and healthy forex reserves.
The report notes that while the Indian rupee depreciated by 0.2% in October vis-a-vis the US dollar, the domestic currency appreciated by 1% in terms of the real effective exchange rate when measured against 40 currencies during the same period.
“India’s foreign exchange reserves have increased by $28.1 billion during the calendar year 2023 so far, which is the highest among major foreign exchange reserves holding countries,” the report said.