Monday, November 9, 2009
Friday, November 6, 2009
Josh's Blog has moved to www.joshisblogging.com
Check out my new blog address: www.joshisblogging.com
Hurry get over here and check out my new articles!
Hurry get over here and check out my new articles!
Thursday, October 29, 2009
Saturday, October 24, 2009
Wednesday, October 14, 2009
Utah's Economic Recession Bottoming Out
THIS ARTICLE WAS TAKEN FROM UTAH PULSE.COM
Utah's most painful economic contraction since the Great Depression appears close to establishing a bottom, according to the Autumn 2009 issue of Zions Bank's Insight-Economic News of Utah and the Nation released today. Prospects are rising for a return to modest Utah job creation that should be clear within 6 to 9 months.
"Utah's economy should show more signs of life throughout 2010," said Jeff Thredgold, economic consultant to Zions Bank and author of Insight. "Even as the economy stabilizes, however, more vibrant economic conditions seem perhaps 18 to 24 months away."
The five states sharing a border with Utah currently have an average unemployment rate of 9.0 percent, versus 6.0 percent in Utah, while the three West Coast states have an average jobless rate of 11.2 percent. Utah's painful 4.4 percent decline in total employment during the past year has been exceeded by the average 5.4 percent rate of decline among the five bordering states.
The quarterly Insight publication features updates on current and projected economic developments for the state of Utah, the nation, and the global economy. The Autumn 2009 issue also examines the federal deficit. Following are a few highlights from the latest Insight:
As is true across the nation, the majority ofUtah's lost jobs during the past 18 months have occurred in construction and manufacturing. Substantial Utahemployment weakness has also occurred in trade, transportation and utilities and professional and business services.
Only education and health services and the government sector added jobs during the most recent 12-month period.
Utahwill continue to do well in attracting new employers and retaining existing companies in coming years because of the reasonable cost of doing business, as well as a more affordable cost of living than found in many areas across theU.S.The August 2009Utah"cost of doing business" estimate of Moody's Economy.com was 90 percent of theU.S.average. Similar costs forSalt Lake Cityand Provo-Orem were 87 percent and 81 percent, respectively.
The plunge in new home construction acrossUtahand around the nation during the past two years should give way to modest, but continual, improvement in coming years.
Jeff Thredgold's full report:
http://utahpulse.com/files/UT%20Insight%20autumn%2009.pdf
Utah's most painful economic contraction since the Great Depression appears close to establishing a bottom, according to the Autumn 2009 issue of Zions Bank's Insight-Economic News of Utah and the Nation released today. Prospects are rising for a return to modest Utah job creation that should be clear within 6 to 9 months.
"Utah's economy should show more signs of life throughout 2010," said Jeff Thredgold, economic consultant to Zions Bank and author of Insight. "Even as the economy stabilizes, however, more vibrant economic conditions seem perhaps 18 to 24 months away."
The five states sharing a border with Utah currently have an average unemployment rate of 9.0 percent, versus 6.0 percent in Utah, while the three West Coast states have an average jobless rate of 11.2 percent. Utah's painful 4.4 percent decline in total employment during the past year has been exceeded by the average 5.4 percent rate of decline among the five bordering states.
The quarterly Insight publication features updates on current and projected economic developments for the state of Utah, the nation, and the global economy. The Autumn 2009 issue also examines the federal deficit. Following are a few highlights from the latest Insight:
As is true across the nation, the majority ofUtah's lost jobs during the past 18 months have occurred in construction and manufacturing. Substantial Utahemployment weakness has also occurred in trade, transportation and utilities and professional and business services.
Only education and health services and the government sector added jobs during the most recent 12-month period.
Utahwill continue to do well in attracting new employers and retaining existing companies in coming years because of the reasonable cost of doing business, as well as a more affordable cost of living than found in many areas across theU.S.The August 2009Utah"cost of doing business" estimate of Moody's Economy.com was 90 percent of theU.S.average. Similar costs forSalt Lake Cityand Provo-Orem were 87 percent and 81 percent, respectively.
The plunge in new home construction acrossUtahand around the nation during the past two years should give way to modest, but continual, improvement in coming years.
Jeff Thredgold's full report:
http://utahpulse.com/files/UT%20Insight%20autumn%2009.pdf
Monday, October 12, 2009
On the Verge of Recovery…
What would a recovery in the local real estate and housing market look like? What initial changes in attitude, behavior and sentiment would be demonstrated by home buyers? What signs should we be looking for? I believe these questions are key for us to focus on if we are going to be able to forecast or predict the recovery before the local news reports tell us we’re recovered. By then, prices will have started to increase and sellers will have much less motivation to agree to buyer’s terms (closing costs, rate buydowns and other incentives).
Thus far in the recovery we’ve seen first time home buyers motivated to purchase homes because of government programs such as the Federal $8,000 tax credit, the $4,000 Utah Home Run Grant and of course the Federal Reserve’s $1,250,000,000,000 (yes that’s one trillion, two hundred fifty billion dollars) Mortgage Backed Security Purchase Program, which has essentially kept interest rates for all of 2009 at the lowest rates our country has ever seen. These programs have been successful, at least locally, as we’ve seen our sales numbers and prices in many zip codes reverse course from 2008 when there was no bottom in sight.
The first wave of the recovery was definitely first time home buyers who decided the government incentives were too great to miss out on, so in the face of uncertain home values and a sketchy employment picture many of them decided to get in.
In the first half of 2009 83% of my purchase business was first time home buyers.
But in July of 2009 something interesting happened, the number of move up or second time buyers increased dramatically. In the third quarter of 2009 (July, Aug and Sept) 47% of my purchase transactions were previous home owners or move up buyers. These were previous home owners motivated to buy not just because of fiscal stimulus from the government. They had been patiently watching the market and decided this was the time to get in and move up to a nicer home.
In the 3rd quarter of 2009 only 53% percent were first time home buyers, a 30% increase in purchases from current or previous home owners.
I think this is a decisive and important change in sentiment for our market. These experienced home owners are saying that they feel good enough about local values, employment and their future that they are willing to risk moving up to a nicer home.
Another very interesting and healthy indicator for our market is the increase in new construction interest. From June 2008 to June 2009 I had not closed one construction loan, nor had I even had anyone ask about building a home. In the last three months I’ve received well over a dozen construction inquiries or applications and closed 4 construction loans. These clients are telling me that the inventory on the market is picked over and what’s left is mostly low quality stuff. After a year or more of watching the market and looking for some half priced bank owned or short sale they’ve become frustrated and have decided to build what they want. This is a similar story to what my Realtor friends who work closely to builders are hearing. It’s a very healthy sentiment change that will bode well for our local market. As interest in new construction increases, values will start to increase.
This change in sentiment that is becoming more and more prevalent has already started to increase values. Year over year most Utah Zip codes are still reporting losses in values, but month over month values are starting to flatten and even increase. Many like South Jordan for the first time in two years. This indicates were on the front edge of a recovery and from a long term buy and hold perspective, this is where the best buys are often found.
We’re not totally out of the woods yet, but things are looking better, much better. Any investment have risks and buying a home is no different, the key here is being aware of what’s going on and being a step ahead of the crowd, the newspapers, and the sellers who will undoubtedly become emboldened as more signs of a recovery emerge.
Thus far in the recovery we’ve seen first time home buyers motivated to purchase homes because of government programs such as the Federal $8,000 tax credit, the $4,000 Utah Home Run Grant and of course the Federal Reserve’s $1,250,000,000,000 (yes that’s one trillion, two hundred fifty billion dollars) Mortgage Backed Security Purchase Program, which has essentially kept interest rates for all of 2009 at the lowest rates our country has ever seen. These programs have been successful, at least locally, as we’ve seen our sales numbers and prices in many zip codes reverse course from 2008 when there was no bottom in sight.
The first wave of the recovery was definitely first time home buyers who decided the government incentives were too great to miss out on, so in the face of uncertain home values and a sketchy employment picture many of them decided to get in.
In the first half of 2009 83% of my purchase business was first time home buyers.
But in July of 2009 something interesting happened, the number of move up or second time buyers increased dramatically. In the third quarter of 2009 (July, Aug and Sept) 47% of my purchase transactions were previous home owners or move up buyers. These were previous home owners motivated to buy not just because of fiscal stimulus from the government. They had been patiently watching the market and decided this was the time to get in and move up to a nicer home.
In the 3rd quarter of 2009 only 53% percent were first time home buyers, a 30% increase in purchases from current or previous home owners.
I think this is a decisive and important change in sentiment for our market. These experienced home owners are saying that they feel good enough about local values, employment and their future that they are willing to risk moving up to a nicer home.
Another very interesting and healthy indicator for our market is the increase in new construction interest. From June 2008 to June 2009 I had not closed one construction loan, nor had I even had anyone ask about building a home. In the last three months I’ve received well over a dozen construction inquiries or applications and closed 4 construction loans. These clients are telling me that the inventory on the market is picked over and what’s left is mostly low quality stuff. After a year or more of watching the market and looking for some half priced bank owned or short sale they’ve become frustrated and have decided to build what they want. This is a similar story to what my Realtor friends who work closely to builders are hearing. It’s a very healthy sentiment change that will bode well for our local market. As interest in new construction increases, values will start to increase.
This change in sentiment that is becoming more and more prevalent has already started to increase values. Year over year most Utah Zip codes are still reporting losses in values, but month over month values are starting to flatten and even increase. Many like South Jordan for the first time in two years. This indicates were on the front edge of a recovery and from a long term buy and hold perspective, this is where the best buys are often found.
We’re not totally out of the woods yet, but things are looking better, much better. Any investment have risks and buying a home is no different, the key here is being aware of what’s going on and being a step ahead of the crowd, the newspapers, and the sellers who will undoubtedly become emboldened as more signs of a recovery emerge.
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