Brandon Donnelly — Daily insights for city builders. Published since 2013 by Toronto-based real estate developer Brandon Donnelly. — Page 1044

The Guardian has just published a fascinating article about the reprivatization of property in Warsaw. This is the process by which previously nationalized property is returned to pre-communist owners, or their heirs.

Not surprisingly, the government gets a lot of these sorts of claims, though many of them are clearly bogus. Between 2007 and 2017, Warsaw City Hall estimates that 447 properties, representing about 4,479 dwellings units, were reprivatized.

For some, all of this is restitution for widespread expropriation during the communist era . But for others, it quite simply means eviction. 

The story at the beginning of the article – about a family who is immediately evicted from their apartment and has their belongings thrown out – seems almost hard to believe. One would think that there would be more sensible transition policies in place.

Another negative has to do with the uncertainty that this creates in the market. Why would you buy and/or invest in a property if there was any inkling that it could be taken away from you? You wouldn’t. 

Click here to read, ‘They stole the soul of the city’: how Warsaw’s reprivatisation is causing chaos. If any of you are familiar with the Warsaw property market, please do leave a comment below.

It’s the Christmas and holiday season, which means two very important things. 

One, it’s time for the latest rendition of Urban Capital’s annual Naughty or Nice party. That was last week and it was #7. Here are the obligatory photo booth snaps to prove it happened.

And two, the latest issue of Site Magazine (from Urban Capital) is now out. 

This year I wrote a piece called “The Canada mission”. It’s all about Urban Capital’s pan-Canadian mission to build from coast to coast. How it happened. The challenges. What’s driving it. And what have been the results.

The article includes case studies from Urban Capital’s two newest markets: Saskatoon and Winnipeg. 

One of the things that I didn’t fully appreciate until I started researching for the article was just how pioneering these projects were. At the time, there were no proof points to suggest that the pro formas would work. And this is a leap of faith that Urban Capital has had to make on many of its projects.

Click here to download a PDF of the full magazine.

Aaron Terrazas, who is a Senior Economist at Zillow, recently gave this presentation about the US and Virginia Beach housing markets. (I discovered it through City Observatory .)

There are a bunch of interesting graphs/stats in the presentation. Home values in Virginia Beach, for example, have yet to fully recover from the 2007-2008 financial crisis. They are still 8% below their pre-crisis peak, which was in July 2007. (I presume the presentation is dealing in nominal dollars.)

I’ll give two more examples. 

Below is a chart comparing average home prices for rural (dark blue/purple), suburban (blue), and urban (green) homes. In the late 90′s, suburban and urban homes were roughly equal in terms of average prices. But since then, urban homes have shown greater appreciation. The spread also appears to be widening.

And here is a graph showing the share of mortgage borrowers in a negative equity position. That is, the value of the home is less than the outstanding balance of the mortgage.

Now this is only covers people who have a mortgage. According to this Washington Post article , about 34% of all US homeowners don’t have one. Either they have paid it off or they never had one.

Still, the above numbers stood out to me. They speak to the severity of the financial crisis. At the end of 2011 and the beginning of 2012, over 30% of borrowers were in a negativity equity position. And in Virginia Beach it was more than 1/3 of all borrowers at the peak.

For the full presentation, click here .