Economy's crystal ball: real estate
Mortgage rates are back in the 4 percent range, taken there by the 10-year Treasury note's drop to 3.42 percent, which has wiped out the whole early-February spike. We have Libya, oil, stocks, housing and the economy to thank, but how those pieces interact is not obvious.
Arriving economic data is obscured by incessant "recovery" cheerleading among business media. Some news is pretty good: both consumer-confidence surveys found three-year highs, which may indicate some hiring.
New claims for unemployment insurance are holding down near 400,000. Every measure of manufacturing is doing well, although scratching in at 15 percent of our economy.
The "wait-a-minutes" are led by today's downward revision in supposedly corner-turning fourth-quarter 2010 U.S. gross domestic product (from 3.2 percent to 2.8 percent).
Growth? Sure. Self-sustaining, accelerating ... not so much.
Wal-Mart's sales in the last 90-days fell 1.8 percent. Orders for durable goods in January (excluding super-volatile transportation and defense) tanked 6.9 percent. The Chicago Federal Reserve's January national index rolled to a minus sign.
If you're in doubt, consider housing. New-home sales dumped 12.6 percent in January. But, the National Association of REALTORS® says sales of existing homes rose 2.7 percent. Hmmm.
A story cooking for months: NAR may have overreported those sales for 10 years or more, high by perhaps a half-million each year vs. CoreLogic (its parent is a title company using real data), and since 2008 resulting in as many as 1.5 million imaginary sales each year.
Nothing intentional, of course -- I first joined the National Association of REALTORS® in 1978 and quickly learned not to trust the association to count to 10 on its toes and get the same answer twice in a row.
If existing-home sales are running below 4 million annually instead of above 5 million, then we have rather more trouble with distressed-inventory absorption than we thought. And market buyers and sellers have left the field or been elbowed from it.
On that subject, NAR said only 37 percent of January sales were distressed ("only" ... sheesh). CampbellSurveys.com, meanwhile, says the distressed fraction was 44 percent in November, and shot up to 49.6 percent in January (California at 66 percent, Florida at 63 percent, Arizona and Nevada at a whopping 72 percent).
Now two things not to worry about: inflation and the Middle East.
Inflation comes in a few well-defined forms. The deadly one is the wage-price spiral, which plagued us in the 1970s and can be stopped only by recession.
The U.S. today is impervious to such a spiral because we have near-zero wage growth. In fact, rising oil prices will slow this economy by crowding out other spending. Note that commodity prices have fallen -- not following oil, instead anticipating slowdown. Same for stocks.
Other inflation forms include the classic money-printing of Zimbabwe and Weimar. The Fed's "quantitative easing" (QE) program does print monetary electrons, but the money cannot make it into wallets because the credit system is still broken. No credit, no money.
The last form, cost-pushed inflation, is temporary -- it is not a structural ramp-up in general prices. That's what this is. Oil is driven by speculators, just as it was in 2008, and all should be reassured that this spike has stopped far short of that run to $150 per barrel.
Middle East ... it takes some serious chutzpah to be relaxed about the place. But, concept No. 1: the Middle East nations need to sell oil worse than we need to buy it, no matter who is in charge over there.
Non-oil economies in the Middle East have never developed, and 10-fold growth in population has made '70s-style embargoes impossible today.
No. 2: Despite U.S. bejabbers about radical Islam, these brave Tunisians, Egyptians, and Libyans are in their streets waving their national flags, not pictures of Osama.
No. 3: Post-revolutionary peoples' governments, no matter how they may roil and rock, are steadier by far than rotten autocracies, especially in dealings with neighbors. Some go sour (Iran), some are in doubt (Iraq), but dictatorships breed anger and extremism, and dictators need to pick external fights with pretend enemies.
Refounded nations, even while struggling to establish representative government, have stabilizing advantages. The greatest of these: pride at self-liberation won hard.
We live in one of those places.
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| Homeowners Willing to Tackle Remodeling Projects |
| By Kathleen Lynn |
| RISMEDIA, February 25, 2011-(MCT)-Homeowners who put off renovations during the recession are thinking about spending money on their properties again. Take Barbara Moreno and Robert Ptaszynski of Washington Township, N.J., who delayed plans to add a second story to their ranch house when the recession hit their industries-automobiles and title insurance-hard. Now they're ready to move forward, because they feel more confident about the economy. "Things seem to be-knock on wood-settling down a little bit," Ptaszynski said this week at the Home Show in Secaucus, N.J. Contractors said that customers seem willing to spend again-but cautiously. "People have been procrastinating for almost three years now," said Joe Tighe of Complete Roof Systems in Dumont, N.J. During the recent economic hard times, homeowners were more likely to ask about patching and repairing, rather than replacing, their roofs. But now, they seem more willing to tackle the big jobs, he said. "The general mood I get from people is that they're ready to spend money again," Tighe said. After homeowners slashed their spending during the recession, housing analysts say the remodeling industry is poised for a bit of a revival. According to the Joint Center for Housing Studies at Harvard, spending on remodeling is expected to rise 4-6% this year, as long as the job market and economy continue to recover. "We don't expect spending to rebound to the heights that we saw during the housing boom; that was unsustainable," said Abbe Will, an analyst at the Harvard center. "But we're in a better place now than we were a year ago. As long as the economy continues to improve, homeowners will have more confidence and be more willing to use their savings to make improvements that they've likely been putting off for a couple of years." Tax credits for energy-efficient improvements will also help buoy the market, said Will. And buyers who move into foreclosed properties over the next several years will probably have to spend significant amounts on home improvements, because those properties are typically neglected. Ray Engel of Sierra Landscape Design and Garden Center in Wanaque said he was approached at the home show by several people who said they had bought foreclosed homes and need to update the landscaping. But it's clear that homeowners continue to watch their budgets. "Everybody's looking for a better deal," said Gary Townsend of The Kitchen Guy in Little Falls. Homeowners interviewed at the at the home show, which ran for three days at the Meadowlands Exposition Center, want to make sure their homes work right, not spend tens of thousands on luxury upgrades. Janice Campbell of Cliffside Park, for example, wants to renovate her bathroom because the tub is leaking. "It needs to be done, but it doesn't mean I go overboard," said Campbell, who is retired. "It has to fit within the budget." Similarly, Sharon and David Berger of Teaneck are considering a renovation of their main bathroom, which is original to their 1950s split level, because the shower isn't working properly. "What I'm doing now is getting an idea of what things cost," said Sharon, who runs a promotional advertising business. Several of the contractors at the show said they are benefiting from homeowners' thrift. Lucia Portali Waters of Fabu Designs by Lucia in Hasbrouck Heights said that when times were good, affluent homeowners hired her to paint murals and apply decorative wall and ceiling finishes. Recently, however, she's been painting and refinishing furniture and kitchen cabinets for customers who want to be practical and save money. "They don't want to rip out their cabinets," she said. "They're not replacing; they're refinishing." James Saluzzi of Emerson Construction Corp. in Emerson said he's seen the same thing. He worked recently on updating a kitchen in Old Tappan, where the homeowner had the walls painted, the cabinets refinished and a new backsplash installed. "Five years ago, he would have ripped the whole thing out," Saluzzi said. |
Main Street at Lakewood Ranch
Music on Main Street March 4th
Bring your chair and sit and listen to the evening music. Maybe even dance. From 6 to 9 pm you will be able to relax, shop or dine if you choose to. This is a free event to the public. Every month there is a different band to enjoy. This will benefit a local non-profit organization.
Your dogs are welcome. Management prefers all dogs on a short lease. Need a place to park. The Lakewood Ranch Medical Center is directly across the street.
It is sure to be a great time.
I'll see you on the ranch...
Jim Soda
sodasells@gmail.com / donnasoda@gmail.com
941.809.7759 / 941.961.5857
Lakewood Ranch Homes & Lakewood Ranch Properties / Open House Feb. 27th 1-4 pm
http://www.youtube.com/watch?v=2G66IGZCr8c
Lakewood Ranch Country Club Home.
3 bed. 2 full bath. Lake View. Gmt.Kitchen. Fabulous Lake View. Maintenance Free Area. Pool and Spacious Lanai.....Offered at: $365,000
Furniture Available seperately.
sodasells@gmail.com / donnasoda@gmail.com
941.809.7759 / 941.961.5857
Lakewood Ranch Homes and Lakewood Ranch Properties
13309 Palmers Creek
http://www.youtube.com/watch?v=itTZZE8l0Hw
Lakewood Ranch Country Club Home.Magnificent Country Club Home with decadent appointments. This home offers 5 bedrooms and 4 1/2 baths. A stunning arched custom door with transom leaded glass entry. Designer Draperies. Fabulous Chandeliers and solid casted Spanish Alabaster light fixtures. Diagonal Tile and honey onyx accents on flooring. Exquisite gourmet chef's kitchen. Miele cappuccino/espresso maker, double dishwasher, 6 burner Dacor cooktop with pot filler. Spacious hidden pantry. Top of the line cabinets. Office floors are cherry wood. Sink has a foot pedal for controlling water on and off. Nutone CD Intercom, two-way fireplace from family room to bonus room. Impact resistant Mylar on windows. Another fireplace on outside lanai. Master has 18 JETTED SPA! Expansive double head shower w/fountain views. Private Bidet. Custom closets w/ironing board. Central Vac. 2 wine refrigerators. Butler's Bar with under-cabinet Lighting. Relaxing pool & spa with a long lake view and complete summer kitchen. 2 covered lanai areas. Garage has wall-to-wall built-in cabinets. Entire house has generator and water conditioner. Exterior up lighting sets this home apart and has the utmost perfect curb appeal. Thousands of dollars in lush landscaping. Built in 2004. 3 car garage. 4,207 sq. ft.
sodasells@gmail.com / donnasoda@gmail.com
941.809.7759 / 941.961.5857
Jim Soda - one of the most recognizable and knowledgeble Realtors in the Greater Lakewood Ranch - Sarasota- Manatee Area. From Waterfront Gulf and Bay to exclusive Golf Course properties and condos.
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