Retail sales are booming. Online sales have hit record highs.
The approximately 80% of Americans who are impacted the least severely by the recession are spending money on presents for others and on themselves. This is clearly an indication that the fear level is subsiding. Not gone, but subsiding.
Enter pent up demand. People are spending money on necessary and luxury items. Not foolishly, but as I like to say ‘they are shopping with their brains. not their wallets." Those days are long gone and lessons have been painfully learned. However, consumers are purchasing even though they are comparing prices and are bragging about where they bought things and how much of a discount they received. But they are buying and this is getting the economy and the money moving.
I believe that the two most interesting item in Diana Olick's ( CNBC) predictions for 2011 concern pent up demand. At some point, people who need to move will find a way to move and real estate transfers will happen. She indicates that "Right now housing starts are running near record lows and still falling, but builders believe pent up buyer-demand is coming. As banks begin to loosen credit to builders ever so slightly, they will jump at the opportunity to start new homes. They still have land, and the big builders especially will not want to be left without inventory when demand starts to bloom again." And, second, office and apartment segments will gain again.
People will always have to live somewhere, and I will always believe that dirt in our great country has great value. I've never seen it as challenged as it has been over the past three years, but every movement begins with the first step. My ear is to the ground.
Do you hear the footsteps?
Twelve drummers drumming.....
The KCM Blog reported that sales of homes in excess of $1M are UP over 6.1% and that this trend for the upper-end market will continue as we move forward. They also quoted an article from The Wall Street Journal indicating that "the number of millionaires is soaring - the number of Americans with investible assets of $1Million or more rose 8% in the 12 months ending in June. There are now 5.55 million U.S. households with investible assets of $1million or more."
Explanations for this resurgence are that the affluent were less impacted by the economy and they understand investment cycles and know how to take advantage of historic low mortgage rates.
Smart money investment encourages confidence. Confidence encourages more investing - less fear.
Eleven pipers pipin.....
CNBC reported some very promising news: The CEO's of some of the largest U.S. companies are much more optimistic than they were about the economy a few months ago. Their expectations remain modest for growth.....but...growth is growth!
No one will begin hiring in earnest until they believe that customers are back and demand will continue to increase, however, every business owner has cut overhead to the bone....and at some point the lines will cross and they will have to begin hiring.
Keep that economic sentiment number rising!
Nine lords a-leaping......
San Francisco is basically about 6 miles in diameter. I was on the west side, Lombard Street, trying to go east toward downtown. After I realized that we had been inching along for quite awhile, it occurred to me that this was not traffic heading downtown. Tourists were lining up for about 5 miles to go down the "Crookedest Street in The World" (Lombard Street, SF). The Golden Gate Bridge was jammed with people walking over, enjoying the spectacular view of the City and the Bay. We haven't seen this in three years. The tourists are back!
Since I sometimes joke that the two main industries in the City are lawsuits and tourism.....it is a wonderful thing to see people enjoying the beautiful City, shopping in the stores, eating in the restaurants etc. Reports are that the stores will post great sales numbers for this season, and the restaurateurs are smiling from ear to ear. Also am hearing that they are hiring ....someone has to take care of our tourists!
Get that money moving!
Nine ladies dancing......
Luxury Real Estate is Selling in Resort Regions
George Harvey, Broker / Owner of The Harvey Team, Telluride, CO. shared some more great news with us. Percentage increases in sales of the luxury resort regions of Colorado are led by Steamboat Springs, which reported an increase of 225% from 2009 (September to September). Vail reports a 142% increase in total sales equaling $287.3M. During the same period, Aspen recorded a whopping $822.0M in sales.
Real estate on the move creates jobs - turn on the spigot full force in 2011!
Eight maids a-milking.....
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