Bloomberg - Evening Briefing - Housing paralysis sets in

The US housing market has gone from FOMO to just plain fear. Prices are falling from peak levels, with expensive West Coast markets recording the steepest declines. Bidding wars are fading and sellers are ratcheting down expectations. It should all add up to an opportunity for would-be buyers who have been waiting to gain the upper hand after a years-long market frenzy. Instead, they’re facing the worst affordability in almost four decades. The abrupt end to the pandemic housing boom, driven by the Federal Reserve’s aggressive interest-rate hikes, is leading to a sense of paralysis in the market — a sign price declines will accelerate. With mortgage rates at the highest level since 2008, house hunters have gone scarce, priced out or worried about overpaying as America braces for a potential recession. Even big Wall Street buyers are holding fire, waiting for lower values ahead. “Everyone is coming to the view that prices are going to decline,” said Mark Zandi, chief economist for Moody’s Analytics. “Until that happens, nobody is going to buy.” —Natasha Solo-Lyons

Bloomberg is tracking the coronavirus pandemic and the progress of global vaccination efforts.

Treasury yields hit multiyear highs and stocks fell as a parade of central banks joined the Federal Reserve in boosting rates to curb scorching levels of inflation at the expense of economic growth. Ten-year US yields hovered near 3.7%, the highest since February 2011. The S&P 500 closed at the lowest since June, with some Wall Street voices predicting the gauge may soon test its June bottom that stands about 2.5% below current levels. Here’s your markets wrap. 

US asking rents rose in August by the slowest pace in a year, a sign the hot rental market could finally be cooling, according to real estate brokerage Redfin.

A rental unit apartment building in New York. Photographer: Gabby Jones/Bloomberg

President Vladimir Putin’s order to call up as many as 300,000 reservists to fight in Ukraine triggered alarm and demonstrations as Russians were forced to confront the reality of the deadly conflict.

Take Putin’s nuclear threat seriously, but not too seriously, writes Hal Brands for Bloomberg Opinion. “Few think the Russian leader would be foolish enough to escalate radically, but there’s also a strong argument to be made that he’s not bluffing,” he says. 

Vladimir Putin. Photographer: Andrey Rudakov/Bloomberg

The price of copper — used in everything from computer chips and toasters to power systems and air conditioners — has fallen by nearly a third since March. Investors are selling on fears that a global recession will stunt demand for a metal that's synonymous with growth and expansion.

South Korean leader Yoon Suk Yeol was overheard insulting American lawmakers, after briefly meeting President Joe Biden to discuss issues including US electric-vehicle subsidies that South Korea wants to change.

Japan will abolish a slew of Covid border controls from Oct. 11, Prime Minister Fumio Kishida said in New York, in a move that looks set to revive the tourism industry.

• Bloomberg Opinion: An off-ramp for Putin is repugnant but necessary.
• Bloomberg Opinion: Unless rents rise, housing is set up for an epic crash.
• Japan intervenes to support the yen for the first time since 1998.
• Credit Suisse weighs possible US market exit, Reuters says.
• Tesla recalls almost 1.1 million vehicles over window glitch.
• How neuroscientists use brain breaks to boost creativity at work.
• The sneaky genius of Apple’s AirPods empire.

Formula One leaders Max Verstappen, Charles LeClerc, and Sergio Perez will have their work cut out for them when they return to the Singapore Grand Prix Oct. 2 for the first time since 2019. Racing fans, on the other hand, will have a much smoother time in Singapore—especially if they are ready to splash out. After Covid-19 restrictions iced F1 over the past two years, there is a lot of partying to make up for—and plenty of ways to do it. Green Day, the Black Eyed Peas, Marshmello, Kid Laroi, and Westlife will be performing. F1-branded nightclubs that travel the globe to each race will set up shop. Nearby, the Singapore Zoo will offer nighttime safaris, and yacht charters will run nonstop in Marina Bay. 

Singapore. Photographer: Lauryn Ishak/Bloomberg

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