Monday Morning Quarterback
(Monday, November 11, 2025)
The Water Wars are Blowing Up (Part 1). There is a water crisis, but nobody seems to care. I write about the water crisis every year, but nobody seems to care. The Colorado River is drying up, but nobody seems to care. Lake Powell and Lake Mead are at their lowest levels in history, but nobody seems to care. Teh California Legislature keeps kicking the can down the road, and the Federal government (when they're open), is ignoring the crisis. Here's the problem. A quarter century of climate change and drought has driven water levels along the Colorado River and its two main reservoirs to historic lows, threatening supplies that support 40 million people and economies from Phoenix to Denver to Los Angeles. Worse, the seven states that share the West's most important river are locked in battle over who must make sharp cuts in their water use to avoid a catastrophe that could hit us as soon as next summer, in which Federal dam managers would have to decide between cutting water deliveries to Arizona, California and Nevada, or losing hydropower production (that is critical to the stability of four region's electrical grid and potentially damaging the nation's largest dams). There are flailing state and local officials, irate farmers, and ranchers, dilapidated dams that were once the pride of American engineering, and an international treaty with Mexico, all affected. Perhaps most notably, the man the administration has tapped to run point on the Colorado River crisis is a George W. Bush-era budget wonk known for his sweet tooth and pet Siamese cats, who is a self-described neophyte to the arcane and fraught world o Western water. State leaders now see Scott Cameron's pick as an indication that (at least for now) the Interior Department plans to step gingerly through the political landmines that surround the question of how to keep water flowing to our cities, farms, tribes, mines, and data centers, rather than blow them up. Just thinking about this crisis makes me thirsty!
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Water Wars (Part 2). As I’ve said, the Colorado River’s problems have been building for decades. Warming temperatures and reduced precipitation have caused its flows to shrink by 20-30% percent over the past quarter century. Prior droughts have been weathered thanks to the nation’s two biggest reservoirs, Lake Mead and Lake Powell. But demand has outstripped supply for so long now, water levels at the lakes are plunging towards record lows. The situation has set off a brawl among the states, who have been harboring grudges and animosity against each other for much of the past two decades and now must agree on new rules to govern the waterway before the current ones expire at the end of next year. If they can’t, the federal government will have to decide unilaterally how to keep the system operating. But even as they continue negotiating, the states are also quietly beefing up their legal teams in preparation for a high-stakes court fight. And they’re lining up their congressional delegations around their battle lines. Meanwhile, California (which has seen federal funding cut by the White House during the shutdown and had its water systems manipulated at the beginning of the Trump administration) holds the largest entitlement to the river out of all seven states and will likely see the most dramatic cutbacks. But Cameron is holding his breath, hoping that the looming water crisis doesn’t get pulled into the administration’s efforts to inflict suffering on its political rivals. “God, no, not when it comes to water. We just can’t have that nonsense happening,” he says. “I pray it doesn’t because it would just make things that are already in dire straits worse.”
US Cities With the Most Skyscrapers. Skyscrapers do more than scrape the sky; they reveal how a nation chooses to grow. This ranking of U.S. cities with the most tall towers highlights five very different models of urban ambition: New York City, Chicago, Miami, Houston, and Los Angeles. Each skyline is shaped by a distinct mix of history, economics, regulation, and geography, from New York’s finance-fueled supertalls to Miami’s height-limited residential boom. Why does density concentrate in some cores while others spill into multiple business districts or coastal corridors?
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5. Los Angeles, California. California’s skyscraper story is anchored by our very own Los Angeles (California’s largest city) and notably the West Coast’s biggest skyline. LA counts 800+ high-rises, including 107 exceeding 300 ft and 88 topping 100 m, with 32 at 150 m+ (placing the city fifth nationally). Two supertalls crown the skyline: Wilshire Grand Center (1,100 ft, 2017), California’s tallest, and U.S. Bank Tower (1,018 ft, 1989). The city’s high-rise era began with the 13-story Braly (1903), but a 1904 height cap of 150 ft (except for 1928’s iconic City Hall) kept buildings low until the limit was lifted in 1957. A major boom from the 1960s to the 1990s produced many downtown landmarks, followed by a residential-heavy surge from the mid-2010s that pushed the core south. Today, tall clusters span Downtown, Century City, Wilshire’s Koreatown/Miracle Mile corridor, Westwood, LAX’s Century Boulevard, Hollywood, and the San Fernando Valley, with additional hubs in Long Beach, Glendale, and Irvine.
Multi-Family Turnaround? Los Angeles’ multifamily market saw occupancy fall 40 basis points year-over-year, while rent prices took a slight 0.2% dip quarter-over-quarter, according to Colliers’ third-quarter data. Yet some capital markets experts expect to see a turnaround. Despite the slips, Kitty Wallace, a senior executive vice president with a focus on multifamily at Colliers, says L.A.’s multifamily market is faring a bit better than the U.S. overall – comparing L.A.’s 94.9% occupancy to 93.2% nationwide. Rather than a result of “fundamental issues,” she sees this decrease as a reflection of supply and demand, also noting a snag in population growth because of the recent ICE raids in Los Angeles. Two of the submarkets dragging down L.A.’s overall stats are downtown and Hollywood/Mid-Wilshire, which have 92.9% and 94.1% occupancy rates, respectively. Wallace attributes these lags to overbuilding. Before the pandemic, there were large scale revitalization efforts happening downtown in the multifamily sector. However, when the Covid-19 pandemic hit and downtown’s attractions (such as restaurants, The Broad Museum, the L.A. Philharmonic, the former Staples Center and the like) shut down, people weren’t as interested. “Downtown didn’t come back and all that brand new product had just been built,” Wallace says, adding that Hollywood and Koreatown also experienced this phenomenon to a degree. Because of some hesitation surrounding new construction resulting from both Measure ULA and pressures from market uncertainties, Wallace anticipates occupancy rates will eventually rise in these areas as less projects take off. Last quarter, 2,554 units worth of multifamily construction broke ground along with 5,292 units delivered, Colliers reports. “That’s a good amount for Los Angeles, honestly,” Wallace says.
Foreclosure Activity Increased Annually in Q3 2025. ATTOM real estate data released its Q3 2025 U.S. ”Foreclosure Market Report” which shows a total of 101,513 U.S. properties with foreclosure filings during the third quarter of 2025 up 17 percent from a year ago. The report also shows a total of 35,602 U.S. properties with foreclosure filings in September 2025, up 20 percent from a year ago. “In 2025, we’ve seen a consistent pattern of foreclosure activity trending higher, with both starts and completions posting year-over-year increases for consecutive quarters,” said Rob Barber, CEO at ATTOM. States that had the greatest number of foreclosure starts in third quarter of 2025 included: Texas (9,736 foreclosure starts); Florida (8,909 foreclosure starts); California (7,862 foreclosure starts); Illinois (3,515 foreclosure starts); and New York (3,234 foreclosure starts). Those major metros with a population of 200,000 or more that had the greatest number of foreclosures starts in Q3 2025 included Houston, Texas (3,763 foreclosure starts); New York, New York (3,452 foreclosure starts); Chicago, Illinois (3,144 foreclosure starts); Miami, Florida (2,502 foreclosure starts); and of course Los Angeles (2,321 foreclosure starts). Lenders repossessed 11,723 U.S. properties through foreclosure (REO) in Q3 2025, up 4 percent from the previous quarter and up 33 percent from a year ago. Those states that had the greatest number of REOs in Q3 2025 were Texas (1,288 REOs); California (1,132 REOs); Florida (762 REOs); Pennsylvania (708 REOs); and New York (644 REOs).
Home Sellers Get A Reality Check Even As Sales Pace Inches Up. There was listlessness in the housing market this summer. Sellers across much of the country faced one of the slowest real-estate markets in the last decade. With homes taking a lot longer to sell, a rising number of sellers resorted to cutting their asking prices, while others abandoned plans to sell altogether as they get few compelling offers for their properties (a practice referred to as “delisting”). As a result, inventory levels are at their highest since May 2020, Lawrence Yun, chief economist at the National Association of Realtors, told reporters on a call last Thursday. The national housing market remains frozen. Existing home sales rose slightly at end of October but remained at a relatively low level as buyers continued to stay out of the market. Homes are still too expensive for many, with the median price hitting a record high of $435,300. Nationally, elevated mortgage rates remain another barrier. “Given that price increases are very minimal, and incomes are now rising … one can say that things are a little better today [for] buyers as compared to a couple of years ago,” Yun says, adding that buyers are even in a position to negotiate better prices. Price reductions in some parts of our country could also bring more buyers back to the market. Existing home sales rose by 2% in October to a 4.01 million pace from the previous month. [That’s the number of homes that would be sold over an entire year if sales took place at the same rate in every month as they did in August.] The numbers are seasonally adjusted. “We’ve been stuck at these 4 million levels … for the past two and a half years,” Yun says. Home sales are up 0.8% from a year ago. Nationally, 21% of homes were sold above listed price, down from 24% the same month a year earlier. Homes received an average of 2.1 offers. The total number of homes listed on the market in October rose 15.7% from last year, to 1.55 million units. There is a 4.6-month supply of unsold inventory, which is considered by the industry to be a balanced level. All-cash buyers made up 31% of sales, a slightly elevated share. The share of individual investors was 20%, while 28% of buyers were first timers. The NAR data also revealed that listed homes remained on the market for 28 days on average. Last year, homes sold more quickly, in 24 days. Some sellers are responding to the slower pace of sales by cutting prices.
Home Remodeling Costs Outpace Inflation As Labor Prices Climb. If it seems like it’s getting more expensive to replace a broken door, kitchen fixtures or upgrade a major appliance, you’re not wrong. The cost of home repair and remodeling projects is up compared to a year ago and running ahead of inflation overall, according to a report from data analytics company Verisk. The firm’s latest “Repair and Remodeling Index” jumped 3.4% in the April-June quarter compared to the same period last year. That’s a bigger annual increase than the 2.7% rise in inflation in the same period, as measured by the Consumer Price Index. “While costs did continue to rise, they rose at a slower rate than in the first quarter,” said Greg Pyne, vice president of Pricing at Verisk Property Estimating Solutions. Much of the increase in home repair and remodeling costs appears to be driven primarily by higher labor costs for repair and remodeling work, Verisk noted. The second-quarter jump in costs for home improvement products coincided with the Trump administration’s broad rollout of tariffs on imported goods from many of the nation’s major trading partners. But the tariffs didn’t have the expected impact given they were postponed several times and didn’t fully take effect until early August, midway through the third quarter. However, homeowners looking to replace cabinetry could soon see prices increase sharply, following a new volley of tariffs announced by President Trump that includes a 50% import tax on kitchen cabinets and bathroom vanities. The most labor-intensive types of home repair or remodeling work registered the biggest quarterly increase in labor costs. For example, the cost of replacing tile flooring rose 1.2%, while the cost of remodeling a primary bath or replacing vinyl siding, each rose 1% in the April-June period from the previous quarter. The latest index puts costs for repair and than remodeling at almost 62% higher than they were 10 years ago and more than 73% higher than the first quarter of 2013, when the index debuted.
Basic Training Investing Boot Camp. This Saturday, November 22, 2025, 9:00 am to 6:00 pm, will be our semi-annual Basic Training Boot Camp. Everything you ever wanted to know about real estate investing but were afraid to ask. Iman Cultural Center, South Hall, 3376 Motor Avenue (between National and Palms), Los Angeles, 90034.The cost of the Boot Camp is $149.00 per person if paid before November 15, 2025. Thereafter the prices increases to $249.00. (Gold Members and former Boot Campers can attend for FREE, but still need to register.) So don’t wait to register. Plus free parking. Please register at our website: LaRealEstateInvestors.com.
This Week. Looking ahead, investors will continue watching for additional information about tariffs and monitor comments from Fed officials for hints about monetary policy later in the year. With the government shutdown, it will likely be another light week for major economic data. If it is released on schedule, the focus will be on CPI on Thursday. The Consumer Price Index (CPI) is a widely followed monthly inflation indicator that looks at the price changes for a broad range of goods and services.
Weekly Changes:
10-Treasuries: Flat 000 bps
Dow Jones Average: Fell 700 points
NASDAQ: Fell 900 points
Calendar:
Thursday (11/13): Consumer Price Index
Friday (11/14): Retail Sales
Friday (11/14): Producers Price Index
For further information, comments, and questions:
Lloyd Segal
President
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