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"They" usually have the chicken vs egg answer opposite (and wrong also) except in the case of remote suburbs. Good call Bill.
Interesting - we have seen some commodities in construction bounce off the bottom - must review
HOUSING STARTS UP ....BUT
It would have to be at 1 million for an entire year to equal 40% of the last decades peak year.... one month does not make a market, but its a nice sign....
Housing was so low, it was at about 20%.....
Big Data WARS!
Working from the home office, AKA refrigerator, does no good for my belly.
When you consider MOST of the investor buying that is now tapering off is really a wholesale or holding purchase, the end user is the conventional buyer typically.... Conventional purchases improve due to improvements in the economy and personal income..... investors are just looking for alternatives to other crappy returns.
ITs an improving market due to their large export of government services improving due to tax revenue increases.
....vs NAR building a new HQ in Chicago..... who cares
THAT's an indication/result of job formation that will create household formation.
*[But that doesn't mean the housing recovery is over. What matters for jobs and the economy are new home sales, not existing home sales]
What matters for jobs is the local economy..... job formation creates housing demand, which in turn creates more jobs..... but NAHB is confusing the issue by claiming that housing is THE source of jobs...... you don't get to demand housing until you can pay for it or otherwise allocate resources.
using swords and blood
There are correlations between traffic and sales (with lag).... the first step is gathering data.
"We are getting early signals from lock boxes that show a significant change in direction in August," said Lawrence Yun, chief economist for the National Association of Realtors, referring to the small key boxes that hang on the doors of for-sale homes. The number of times they were opened in August dropped dramatically, signaling a big drop in potential buyer traffic.
WELL, I'm glad Yun is using a tool they have.... but does he have 2012 and previous August data to compare to?
Funny I asked the question to our MLS peeps a few months ago about traffic data and they said NO they couldn't provide aggregate traffic data and trends.... bitches.
Nearing normal inventory patterns. Sellers have been raising their prices, investors aren't finding their bargains as much, returning to normal end users (owner occupants with jobs using financing). Could use more employment as home purchases are a little large for the old EBT card..... but I'm sure there's a plan.
I'm confused. When the labor force participation rate is discussed, the justification for the decline is more people retiring than entering the work force. Shouldn't that imply that we have more single family homes than we'll need for a while?
Some for replacement. The current level is extremely low, whereas the previous high burned too much of the economic engine.
What should we do with the retirees anyway? sardine cans?
I remember the lows of 81-82 - bleak - had just finished my BS and looking at the family SF home business... decided to get a job in aerospace and an MBA. Came back in 86, went on my own in 95 and rode the wave.
The new high is just about at the lows of 82 -- looks like a reasonable living ahead.
I don't have a lot of respect for Yun criticizing from the glass house, BUT read about Shiller profiting from options and investments while producing the housing news..... smells.
*I guess Mr. Zuckerman hasn't been following the discussion of current demographic trends. A significant portion of the recent decline in the participation rate is due to baby boomers retiring and other demographic trends (like more younger Americans staying in school). *
Still, it increases the load on the workforce.... youth is staying in school due to lack of other opportunities and "free money" from big gov.... geez, how much of that retired work force is social security or underfunded/overpromised government pension that we're boosting?
95864(Sacramento east suburb)
$1mil+ sales improving
2013-TWELVE first six months
July 1st-8th = THREE
Indication of improving health.
Accountability? he's taking credit there?
CR said : [CR: I disagree that this is good for investors. I think higher rates will slow investor buying because of competing returns on other investments.]
Absolutely. I don't look to heads of internet real estate outfits for my advice either. Investors have been "parking" their good money in RE.
We need some higher interest rates to put some value to the cost of money, to increase returns to seniors, to create some incentive for new business.
So Wall Street created a crappy product to sell to consumers and extract wealth from real estate that they provided the appraisal expertise, they sell the crap to our pension plans, effectively bankrupting them, we bail Wall Street out, and they want more.....
Rob Dawg wrote:
CA electric rates are so blatantly manipulated it astounds me that we sit still for it and that the federal government doesn't step in.
I'm sure the FEDs prefer we subsidize our own crap playing into their hands.
Comrade Troyski wrote:
plus more amenable to PV to pay for it.
Looked at a 5 state study on PV a few months ago... only pays if your rates are high and they subsidize the PV (usually via those high rates). Welcome to CA!
Love it when questionable data sources attack each other..... Zillow... really?
The problem with a declining number is you still have to feed them, etc. The economy works better when the rate is high, paying them for some kind of production instead of butts on the couch.
Hollywood always has the solution... Logan's Run, Soylent Green,etc.
There isn't any move-up market in terms of size.
It's all downsizing with a high level of amenities and extreme interest in location.
That's what we're seeing... "no place else to get returns, may as well buy a nice retirement house and enjoy it" kind of buying in the higher end.
Housing is a great, almost unequaled economic multiplier.... but I'm not seeing what its multiplying.... yet.
Even here in the Sacramento region, the highest appreciating market in the US, it just seems unsupported by jobs....just fluff from Blackstone and some pent up demand. The high end has some confidence, but its like the stock market and placing futures orders..... waiting for the fundamentals to support the bet.
OMG, someone found the light bulb switch
CoreLogic/S&P/Case-Shiller "Index"? What are we calling it now and are there still real economists involved or is it just pick the best number for clicks and coverage?
Thanks Professor, coming from you... justify my actions over the past year.......Duh!
YEp, empty nesters are a heavy drive on higher end housing.
But really, the demand for new homes is a pittance of the lows over the last 45 years.... THIS is not much demand.
The remaining housing stock is crap for the most part, helped by 5 years of distress and lack of maintenance. let teh banks own that and future land lords.
I'm keying in the 3rd sales tax increase this year in California to my construction estimates (on top of basic increases, impacts of fuel prices, fuel tax increases, etc.)
CA increased sales taxes on 1/1 at 0.25%
Lumber received a special tax of 1% added on 1/1
Sales taxes again increase at the local level 4/1 1/2 %
Think that will total 9-1/2% on lumber.
thank you all so much for burning the tax revenue.... I know those high six figure govt. retirees need our help.
RE: Santa Monica Remodel - aka one wall remaining
This is a really old trick to avoid the costs of tax reassessments, etc. but most of the benefits are long gone. The tax assessor will often look through the trick and reassess the rehabbed at market.... especially if the "value" of the permitted work is >50% of the existing value of the structure.... and lets be honest, most homes needing this kind of work have the majority of value in the land.
The building department will require retrofits that cost much more to do than the cost of beginning with a clean foundation.
Just witnessed a builder dismantle a home over a month by hand, where it would have taken 1-2 days with an excavator.... likely added $20-30K to the bill.
Yup, these highs are so high we've almost reached the lows of the past 45 years.
Conventional sales are up for a few reasons.
Gosh, CR, just read your last post on FNMAE.... my take is the real dilemma for the CEO is "how to maximize my bonus" has has little to do with treasury payback.
I'm a cynic, but bonuses are put in place to encourage certain performance, and sometimes, the people designing that package are working it.
What, are you saying that out beloved Mr. Yun (NAR) has screwed up the data pile only a few months after cleaning it up? SHOCKED
Now all we need is job growth
Nirvana? Dave Grohl is everywhere....
Only in FL....I doubt California's DRE would allow any deposits on an unfunded project.... anyone know different?
Forcasting a 60 day old number? wooo. maybe they'll take my Superbowl bet.
The opportunity to build homes with lumber below the cost of harvest (under $200) aka - the cost of cleaning the parking lot - has passed, but yea, time to crank up the mills and deforestation.
We've got remote zero net energy cabins to build so our supercommuter Prius driving clients can feel good about themselves.
Yes, permit and fee changes as well as code change avoidance,
Seeing a large run in SF luxury home site purchases in December & January, at least escrows opened.... you'll measure it after closing, but there will be more starts in the high end, not for sale.
Always a s***load of permit and housing start manipulation around December/January for tax and profit planning purposes.... multifamily acts different than SF.
wrote on Tue, 2/19/2013 - 7:47 pm (in reply to...)
I have spent quite a bit of time in both.
Lake is by far the scariest.
Yep, start with the inbred, mentally disturbed and violent. Add meth, generic beer and terminal syphilis. And that's in the nice neighborhoods.LAter.
WOW, that's exactly my impression of Lake County.... when I drive by Clear Lake, "Dualing Banjos" plays in my head....
Just goes to show you that idiotic rookie data analysis is more newsworthy than that truth.
Rental real estate must be a new concept to TD Securities.
Bill "...'Just removing multi-family units reduces the "troubling divergence'...."
Elvis wrote on Tue, 2/19/2013 - 2:49 pm
Great news. Many real estate agents have great busts. Otherwise they would never close a deal.
Well, yea, that's part of the fun of working in the field..... but more of a concern is .... how many medical products and drugs are prescribed because of similar skills held by that medical products rep?
The antiquated business model of residential real estate agents and brokerages is the real tax.
Makes a lot of assumptions... that won't happen.
Much of my present business is showing sellers the difference between the Z-estimate and the real value, several times the cost of commission. Next question.
Talked to a soon to be new agent a few weeks ago, CA has a 60+ day lag in processing..... apparently there's never a hurry in CA to create tax generating businesses.