Oversupply Is The Big Fear
A report from the Real Deal. “Banks are shying away from financing new apartment projects as supply starts to outpace demand. This year more than 378,000 new apartments are expected to be completed nationwide, according to real estate researcher Axiometrics Inc. But only 50,000 of the 88,000 apartments completed in the fourth quarter of last year were rented out, the Wall Street Journal reported. ‘Our business has radically changed,’ Toby Bozzuto, chief executive of the Bozzuto Group, which has about eight buildings in New York City, told the newspaper. ‘I haven’t seen anything this seismically different since 2008, when credit dried up.’”
The Chicago Tribune in Illinois. “Magellan Development Corp. is planning to fill a fairly unorthodox position at its newly opened 36-story River North building: live-in musician. The new position is the latest salvo to be fired in the battle for renters in downtown Chicago, where a boom in a luxury residential construction has caused a rental housing glut, and where experts say landlords may soon have to lower monthly rates in order to fill their units.”
“‘With so much new construction everyone is looking for an edge or special identity,’ said Gail Lissner, vice president of Appraisal Research Counselors. Featuring a resident musician can do that without incurring any construction costs or making a commitment that can’t be easily changed, she said.”
The Boston Globe in Massachusetts. “Condo prices in Boston hit fresh highs last year, thanks to sales at several new high-end buildings and the continuing demand for living in the core of the city. But a wave of new units could test the strength of the city’s condo market in the next few years. To date, much of the housing built in the city during the current boom has been apartments, enough to cause rents at the high end of the market to plateau.”
“Data released in early January showed that apartment rental prices fell slightly at the end of 2016 — the first drop since 2010 — amid a surge of new buildings that have opened in Boston and neighboring cities such as Cambridge, Chelsea, and Somerville. Thousands of new condominium units are set to open this year and next, from stand-out towers such as One Dalton in the Back Bay and the Pierce in the Fenway, to more modest buildings in South Boston and the South End. Thousands more are planned or already being built.”
“LINK’s president, Debra Taylor Blair, has heard some fears that there could soon be a glut. But, she said, the steady price growth, along with a historically fast pace of sales, suggest a lot of customers are still looking to buy. ‘Oversupply is the big fear,’ she said. ‘But what these numbers say to us is that there’s a lot of pent-up demand out there to live in Boston.’”
“And Boston’s residential real estate market is often seen as one with little downside risk. Standard & Poors, for example, recently estimated that if another recession hits — even one of the magnitude of the economic downturn that began in 2007 — Boston-area home prices would dip less than 2 percent. Even under the worst-case scenario envisioned by S&P, values in Greater Boston would slip 6 percent, compared to a 27 percent plunge nationally.”
From Houston Public Media in Texas. “You may have heard of the ‘apartment glut’ that’s plagued Houston. In the past three years, developers built around 60,000 – mostly higher-end – apartment units, but because of the slow job growth after the price of oil tanked in 2014, there’s not enough demand to fill many of them. Bruce McClenny, president of Apartment Data Services, said the glut is mostly concentrated on west Houston, where a lot of the upstream oil industry is based.”
“‘And that’s the part of the industry that’s hurting the most right now, so there’s been a lot of job losses,’ he said. ‘And at the same time there’s been a lot of new apartments coming on at the same time. Those two aspects don’t fit well together.’”
“So what will 2017 be like for the apartment market? Probably not much better, McClenny said. ‘There’s another 15,000 (apartments) under construction, (of) that 12,000 will be delivered this year,’ he said. ‘We’re still draining out the supply pipeline.’”
‘Boston’s residential real estate market is often seen as one with little downside risk. Standard & Poors, for example, recently estimated that if another recession hits — even one of the magnitude of the economic downturn that began in 2007 — Boston-area home prices would dip less than 2 percent. Even under the worst-case scenario envisioned by S&P, values in Greater Boston would slip 6 percent’
If you were wondering how developers could get it so wrong, this is an example. Sure, prices of air boxes have doubled since 2010, but these clowns say it would only fall 2%? Go ahead developers, S&P has never let anyone down before.
Ratings agency Standard & Poor’s (S&P) has agreed to pay a $1.38bn (£934m) settlement to US regulators over allegations it knowingly inflated its ratings of risky mortgage bonds.
http://www.bbc.com/news/business-31115174
In Boston the overall price fall in 2007 was lower than the national average, but it was all about the type of property. Condos hurt WAY more than SFHs. Cambridge moved WAY less than Malden.
During the next downturn I predict the area of pain will be the Seaport district, which is super-disconnected from the rest of the city, and contains towers and towers of overpriced condos and apartments. I think people living in Cambridge/Somerville and the wealthy belt towns like Newton, Brookline, etc will see the 2% decline. But I wouldn’t be surprised to see 50% declines in the Seaport, and also the ‘almost good enough’ towns like Malden, Everett, Chelsea
does Lowell still have Asian gangs?
driving in the Boston area requires a car w a dent on every fender
Hope you’re right about Malden as it appears I have been priced out forever here in Cambridge. Growing up in this area, Malden was solidly working class, gritty blue collar and is now considered “very hot”…in the fall I looked at a small SFH that sold in a day of first open house for almost 40K over asking price.
Phew, at least I can live in a “luxury apartment” in Malden until the market drops (fingers crossed).
Everett, yuk. Oh yay, per Google I just learned I can live in a luxury apartment there as well!
‘almost good enough’ towns like Malden, Everett, Chelsea
These places are pretty rough. Went to a TJ Maxx in Everett a couple of years ago that had an armed guard inside.
Boston, my hometown:
http://www.bostonmagazine.com/news/blog/2017/01/27/boston-luxury-condos-video/
‘Houston, a famously cheap place to live, is becoming more aware that its cost advantage is fading as housing demand outstrips supply. But how much demand for more affordable units is actually out there? Can we put a number on it?’
‘The U.S. Census Bureau provides tools to measure that need, and Kyle Shelton at the Kinder Institute at Rice University has crunched the data to come up with a few answers.’
‘On the demand side, more than 435,000 households make less than 80 percent of the median income in the metropolitan area — or less than $55,440 — and either spend more than 30 percent of their income on housing, live in substandard conditions (lacking a kitchen or bathroom) or both.’
‘As far as supply goes, Shelton counts approximately 90,000 housing units that are supported by public subsidies, whether through rent vouchers, public housing complexes, buildings financed through low-income housing tax credits, or other means.’
‘That means that Harris County needs between about 124,000 and 400,000 new or existing housing units to be less expensive than they are now. “No matter how we slice it, the gap is huge,” Shelton says.’
‘Here’s what that looks like for the most severely cost-burdened population — the 214,665 households spending more than half their income on housing, making less than $55,440 per year.’
‘Because of that imbalance, 29,500 people on the waiting list for housing vouchers in Harris County, and 14,400 people on the list for public housing.’
‘Why isn’t the private market filling that need? The answer is complicated, but basically, housing developers can make better profits on luxury products than on housing for low-wage workers. That’s why we saw a glut of high-end apartments in Houston’s toniest neighborhoods toward the end of last year.’
There’s a bubble in the land prices Kyle.
From what I’ve seen of Houston recently, they can’t even afford the land for sidewalks.
where i grew up it was a law that 1 side of the street must have a fulled paved or concrete sidewalk if it was 3/4 mile from a school.. in reality the closer you got to a school usually both sides were paved.
It ain’t as cheap as it used to be….
“more than 435,000 households make less than 80 percent of the median income in the metropolitan area — or less than $55,440 — and either spend more than 30 percent of their income on housing, live in substandard conditions (lacking a kitchen or bathroom) or both.”
Statistical garbage input = policy garbage output.
‘The high volume Tucson apartments bought by investors in 2016 is expected to continue this year as up to 80 percent of local complex owners’ loans come due.’
‘Many 10-year loans for multifamily projects were generated between 2005 and 2008, when the market was hot and lending accessible, said Art Wadlund, a senior managing director at Berkadia, which last year represented owners on 70 percent of sales of properties with 100 units or more.’
‘Data from ABI Multifamily Apartment Brokerage & Advisory Firm shows 2016 saw $426 million worth of sales of complexes with 100 units or more — a 24 percent increase from 2015. Last year’s $76 million worth of sales of complexes, with 10 to 99 units, was an increase of 42.4 percent from 2015.’
‘Wadlund expects that level of activity to continue in 2017 because not a lot of new market-rate apartments are expected to come online this year. “Half of Tucson’s apartment complexes were built in the 1980s,” he said. “The impact of investors entering the market is that those will be upgraded.”
Here’s another link to the subscription WSJ article:
‘Swelling supplies of apartment units are prompting big banks to pull back from new projects, forcing developers to scramble for capital, in a sign that the U.S. apartment industry headed for a downturn. The apartment sector, which contributes some $284 billion to the economy annually, has been a winning bet for investors since the housing crash, as the economy recovered and more renters sought out units. Since 2010, average U.S. apartment rents have increased by 26%, according to data tracker MPF Research.’
‘But fresh supply is beginning to overwhelm demand. More than 378,000 new apartments are expected to be completed in 2017, a 30-year high, according to real estate researcher Axiometrics Inc. In the fourth quarter of last year, 88,000 units were completed but only 50,000 of those were rented by tenants, according to MPF.’
‘Now banks are in retreat, forcing developers to look to nontraditional lenders and seek more expensive types of financing to complete projects, said apartment executives, industry analysts, mortgage brokers and bankers. ‘We had fairly robust growth in our construction, real estate construction book, and that’s slowing now,’ said P.W. Parker, chief risk officer of Minneapolis-based U.S. Bancorp, during an earnings call last month. ‘Multifamily is an area that, if you look at the forecasts, there are forecasts pretty broad-based of potential rent declines in a lot of the major cities. So we’re being more cautious there.’
EB-5s to the rescue! (snark)
‘Banks are shying away from financing new apartment projects as supply starts to outpace demand. This year more than 378,000 new apartments are expected to be completed nationwide, according to real estate researcher Axiometrics Inc. But only 50,000 of the 88,000 apartments completed in the fourth quarter of last year were rented out, the Wall Street Journal reported. ‘Our business has radically changed,’ Toby Bozzuto, chief executive of the Bozzuto Group, which has about eight buildings in New York City, told the newspaper. ‘I haven’t seen anything this seismically different since 2008, when credit dried up.’
‘only 50,000 of the 88,000 apartments completed in the fourth quarter of last year were rented out’
And there are hundreds of thousands of apartments on the way this year. That isn’t counting condos.
“live-in musician”
Are they gonna put hookers in the apartments too, like in Soylent Green? I take mine with a six-pack, kthanx.
The article mentions (it’s been reported before) that some of these are dormitory style apartments. Yep, they really think people are going to pay top dollar to live with strangers. And be subject to having those strangers move out and more strangers move in.
This is what I saw, Ben:
The high-rises are like an extension of college dormitory living
Key word being “extension.” Dorm living means the bath is down the hall. All these units have their own bath (and w/d). So this isn’t dorm living; just luxury high-rise living.
The article I posted recently from the Tribune said they were marketing 2 and 3 bedroom unitss the way I described:
The Chicago Tribune in Illinois. “‘Friends.’ ‘New Girl.’ ‘Sex and the City.’ When you watch just about any sitcom that features 20- or 30-somethings, you inevitably see them living in gigantic apartments located in spectacular areas of fun cities — no matter what the characters do for work (if they even have jobs at all). But if you’ve ever hunted for apartments in Chicago, you know that while these spaces might exist, they exist in … let’s call it a difficult-to-attain price range. ‘People can’t afford to live in these high-end, class-A luxury apartments,’ said Aaron Galvin, managing broker and owner of Luxury Living Chicago Realty.”
“For many renters, fiscal realities dictate that it’s not possible to have both the big space and the great location. So they make compromises. In many instances, this means choosing a desirable neighborhood at the expense of living space — sometimes a lot of living space. ‘We have studios that are under 200 square feet,’ said Mark Heffron, a managing partner of Cedar Street Cos. For other people, compromise means embracing a co-living model, renting out a single bedroom in a furnished apartment in which you share the common areas with a few roommates — typically strangers — who also rent single rooms.”
http://thehousingbubbleblog.com/?p=9977
OK, thanks Ben. I always lived in a traditional dorm, a hallway full of rooms with the bath in the hallway, but I have seen some “luxury” (for the time, lol) dorms where you got thrown into the co-living apartment setup described here.
Hey Donk.
I threw one of these deals in the trash last week…noted it as a top-20 worst deals that I’ve seen in 20 years. Super high returns on paper…wouldn’t touch it from an investment standpoint.
There is always going to be an oversupply of land/real estate/housing. Anyone who says housing will go up in price forever hasn’t been paying attention to long term history or hasn’t really run the numbers. Apartments are practically worthless, why would I buy an apartment when I could buy a house? Condos are a byproduct of the mentality of housing being an appreciating asset. It’s only been in the last hundred or so years where people got the idea of housing being an investment.
It’s only been in the last hundred or so years where people got the idea of housing being an investment.
Gee that’s almost exactly the same amount of time that we’ve had a central bank trying to make sure there was always just enough inflation to prevent people from hoarding money.
“Gee that’s almost exactly the same amount of time that we’ve had a central bank trying to make sure there was always just enough inflation to prevent people from hoarding money.”
Spot on, Carl.
What excuse(s) will Yellen the Felon trot out to explain yet another punt on a March interest rate hike?
Charlie Brown, Lucy and the Football
The sheeple must be spoon-fed The Narrative by the oligarchy’s MSM border collies. No contrary sources of information or challenges to The Narrative can be tolerated or allowed.
http://www.zerohedge.com/news/2017-02-22/msnbc-anchor-admits-our-job-control-exactly-what-people-think
It sounds like you’ve been so spoon-fed about your own anti-narrative that you’ve lost some critical thinking skills. Here’s what Mika said:
——
BRZEZINSKI: “Well, I think that the dangerous, you know, edges here are that he is trying to undermine the media and trying to make up his own facts. And it could be that while unemployment and the economy worsens, he could have undermined the messaging so much that he can actually control exactly what people think. And that, that is our job.”
——
She was clearly indicating that the media’s job is to call out Trump on trying to control people by making up facts, not that the media’s job is to control what people think themselves.
Now, that’s what she said here. It might be different in the editor’s smoke-filled office. The media probably *is* trying to control what we think, not by making up facts, but in what they choose to report. For example, recently PBS has been airing lots of oh-the-poor-immigrants stories without much counterbalance. Thing is, PBS website still allows comments on their stories, and the commenters are accusing PBS of one-sided reporting. Who watches the watchers? Hmm, everybody? Might all be one giant game of Rock Paper Scissors.
You are reading in to the words what you want to hear; not what the person actually said. Reading comprehension?
The quote: “And it could be that while unemployment and the economy worsens, he could have undermined the messaging so much that he can actually control exactly what people think. And that, that is our job.”
Like most of us Oxy, you hear what you think should be said rather than exactly what is said. You could be telepathic and maybe the reasonable conclusion is what the reporter was thinking, but it isn’t in the words.
Using the word “that” is very poor communication because it points to something and people can’t see what is being pointed to. Was it the thing that came right before? No way to tell.
I accidentally caught Colbert’s monologue mocking some comments from Monday’s speech referring to “what happened in Sweden”. Easy to find. Colbert was absolutely rabid and extremely vulgar. Ironically, links to video about the riots in Sweden were in yesterday’s HBB thread. It would appear Colbert was as wrong as wrong can be. He will have a hard time controlling exactly what I think…
A rare moment of honesty by Mika. That was the only surprising part of it.
Most people are glad to be told what to think because it is easier that way. Then they resume their daily biological functions of breathing, eating, pooping, etc.
it is 2007 all over again - Fun Yun.
Rising home prices aren’t stopping people from buying homes. The National Association of Realtors (NAR) said Wednesday US existing home sales jumped 3.3% in January — the highest level since a decade ago, when sales slowed down following the subprime mortgage crisis.
But a lack of inventory to meet pent-up demand for new homes could stand in the way of a fully healthy housing market.
“The biggest hurdle is the fact that there aren’t enough homes,” National Association of Realtors’ chief economist Lawrence Yun told Yahoo Finance. “Hopefully as we proceed through 2017, more inventory can show up, homebuilders can build more homes and there would be healthier development.”
more from Yun -
The tight supply in home construction results from a shortage in able construction workers. And, given President Donald Trump’s aggressive ambitions to crack down on undocumented immigrants, homebuilders may have an even tougher time finding workers in the future, according to Yun.
“It’s widely known but less discussed that there are many undocumented workers at construction sites. And with the border being much tighter, it may lead to a greater construction worker shortage unless America can crank out people with the skills in construction, plumbing, lumber framing, and welding,” he said.
The US has approximately 200,000 unfilled construction jobs, which represents an 81% increase over the last two years, according to estimates from the National Association of Homebuilders.
Homebuilders like Lennar (LEN) and Toll Brothers (TOL) have cited a shortage in construction workers as a major reason they’ve had to slow down home construction.
90 million people not in labor force and we are talking about worker shortage?
At least the Silicon Valley shysters have a case that no American wants to sit in front of a computer 10 hrs a day doing some mundane $hit.
Half of those 90 million are senior citizens
http://www.upi.com/133-percent-in-US-are-seniors/75971362689252/
Not half Mike. 35/90 is closer to a third, but hey it’s only math.
The percentage of seniors working has gone up significantly while the percentage of younger people working has dropped alot.
So now we’re down to just 45 (55?) million people to fill 200,000 positions. Gosh, I don’t think we’re gonna make it. However will America survive this catastrophe! *clutch pearls*
65 mill on soc sec (yes, not in labor force)
15 million tweakers and nut cases who will never be hired.
5 mill working under the table
dig for the real news, not fox fakenews
200,000 unfilled construction jobs
Step up, get a job!
told ya, everyone who wants a job, has a job. the gov is not here to get you a job.
And some in college (although many should never be in college). But the point still remains that far too many people have chosen not to work. #1 reason being, the pay is too low.
That was an article from a few years ago. The quote was “Seniors made up 13.3 percent of the U.S. population in 2011″. Using the current population of the country results in 42.4 million. Of course, the percentage has got to be higher now than it was six years ago, so the number’s probably quite close to 45 million. But hey, it’s only reading and common sense. Those aren’t STEM skills, so they must be unimportant.
If that 90 million number comes from Zerohedge.com, it may also include toddlers.
It’s OK Mike, we can work through this. Please try to subtract the number of seniors that are in the workforce from the total number of seniors. It’s in your article, you just have to read down a few lines. Take your time. Get help from friends if necessary.
Then we can go to step two.
include toddlers…
Don’t wander off now. Toddlers are not in the of working age statistic in any century.
Butters said that 90 million Americans are not in the labor force. Who knows where that comes from? For all you know, it could include children.
The government is here to suppress your earning potential.
Gee, Blue, there’s plenty of arithmetic that could be done, isn’t there? Perhaps the number is 40%. That’s a truly meaningful difference. There are also millions who retire at 62, so a noteworthy little chunk of those who are not in the labor force are retired, but not technically senior citizens.
The IT industry was built on corporate welfare, so the government enhanced your earning potential.
Toddlers aside, the current LF participation rate for seniors is 20%. Up from around 10% in 2000.
https://www.advisorperspectives.com/dshort/updates/long-term-trends-in-employment-by-age-group
Those (over 16) not in labor force is 95 million. Up from 75 million in 2000.
https://data.bls.gov/timeseries/LNS15000000
The mega trend is more seniors working and less % younger working. The decline in 16 to 25 YOs is eyepopping.
BTW, collecting SS does not mean out of the Labor Force. I have several friends collecting SS and stayed working or returned to work.
From BLS website:
for 2014
people “out of the workforce”
65 yr old and older, both genders, 35,398
Thanks for reminding me about the fact that kids aged 16 and 17 are included in that statistic. That means that some of those not participating in the labor force are high school students. Just disregard that statistic. It’s useless.
Remember…….
Labor Force Participation Rate Plummets To 30 Year Low; Joblessness At Record High
https://data.bls.gov/timeseries/LNS11300000
If you are interested at all, the first link breaks out the 16 to 24 year olds to show what is happening to the post school population. Your interest was in seniors, was it not?
Actually, my interest was in ignoring seniors and kids in such statistics. The one that you want to look at just considers people in the age range 25-54. The official version looks a bit different from the dhsort.com rendering:
https://fred.stlouisfed.org/series/LNU01300060
Another thing to keep in mind is that participating in the labor force is not the same thing as holding a job. If you look at the Employment Population Ratio for the 25-54 age group, which is the portion of that age group which is employed, you’ll see that it has been growing steadily for over 5 years and has recovered 3/5 of what was lost in the last recession.
https://fred.stlouisfed.org/series/LNS12300060
“keep in mind is that participating in the labor force is not the same thing as holding a job.”
I’ll grant you that. Also that being employed in no way implies getting paid as far as the Census is concerned. At least the BLS “data” only looks at payrolls.
The recent covers of both Angies List Magazine and This Old House Magazine had the same cover headline: “Help Wanted!” “Now Hiring!” followed by a story of how old guys in the trades were retiring and young people were not entering into the filed. Of course the magazines didn’t go into it, but the reasons for the shortage are apparent: why go into the trades when an undocumented is just going to get the job. And, high schools severely cut down on shop and trade training in order to fund No Child Left Behind, which focused on college-prep for everyone despite abilities or desires. The message was that American kids were “better.” Maybe that’s how we arrived at a generation of “studies” BAs but not a plumber in sight.
Even so, once Americans realize that there are trade jobs to be had, they can train very quickly. Is the Goon of Apt 401 around? His job is pulling wires in lolzluxury apt. How long did it take him to learn that skill, well enough to hired into a position? If every single skilled undocumented worker was gone, how long would it take to train up a workforce of legals?
By the way, another wrinkle to the housing shortage is that undocumented workers are living in this precious housing, and they can’t afford the mortgage or rent without roomies. Deport enough of them, and the remainder will have to consolidate, freeing up housing for more families.
My first co-op job was pulling wire, commercial sound / security installations. When it comes to pulling wire, once you mastered inserting piece of conduit through a wire spool, you were pretty much trained…
I did it one summer. We were building a new outlet mall. Once we had a really big pull and we hooked the wire up to my truck. True story!
The recent covers of both Angies List Magazine and This Old House Magazine had the same cover headline: “Help Wanted!” “Now Hiring!” followed by a story of how old guys in the trades were retiring and young people were not entering into the filed. Of course the magazines didn’t go into it, but the reasons for the shortage are apparent: why go into the trades when an undocumented is just going to get the job.
If plenty of illegal aliens are available to do the work, there must be no shortage. Perhaps there aren’t enough of them and the employers want to pay them less than what they’re currently paying.
told ya, everyone who wants a job, has a job
Only if you have the right skills.
And fit the right demographic, and aren’t too old.
Don’t forget all the people who can’t move because they’re underwater on their houses. The people aren’t necessarily in the same areas as the jobs needing to be filled (to whatever extent that narrative is even true, which I am very doubtful of). The American population is at its lowest mobility in decades.
If plenty of illegal aliens are available to do the work, there must be no shortage.
The shortage is in the skilled trades: plumbing, electrician, HVAC, fine carpentry, design, foremen, and niche skills like asbestos removal. There is no shortage of paint, drywall, and landscaping. Even if some illegal immigrants had the skills, they won’t risk coming out of the shadows to do the paperwork to get licensed and insured, especially not now.
Right….. thats why firms of all disciplines are cannabilizing each other.
you.don’t.know.what.youre.talking.about.
The only shortage in the trades is a shortage of good-paying jobs. I know people, such as electricians, who have been pushed out of jobs they held for years in favor of temps and contract labor, mostly immigrants.
This whole “shortage of skilled people to do the work” is just another BS narrative.
I think the clearest indicator of worker supply is wages. If wages are going up, then there is a true shortage. Obviously, in some fields wages are going up. But on the whole, real wages, which reflect actual purchasing power, have been flat for most:
1) http://www.pewresearch.org/fact-tank/2014/10/09/for-most-workers-real-wages-have-barely-budged-for-decades/
However… Federal Reserve data paints a very different picture:
1) Real Median Personal Income: https://fred.stlouisfed.org/series/MEPAINUSA672N
2) Median Household Income: https://fred.stlouisfed.org/series/MEHOINUSA646N
What’s the true description of reality? Hard to say. I suspect the less rosy pictures are more accurate just because in 2008, the US first voted for a very different, non-traditional candidate. And ditto in 2016. Elections I think are a good way to see how the population is feeling.
Incumbency rates over the years: https://www.opensecrets.org/overview/reelect.php
I found the House chart somewhat amusing. Shows the benefits of gerrymandered districts I suspect.
homebuilders may have an even tougher time finding workers in the future
Give good pay, benefits, and security (or at least pick 2) and watch how fast the problem solves itself.
It’s a Donkism.
You know how many guys are on the bench right now? There’s no work. Go out there yourself and ask around.
What kind of “no work” is there, HA? Ben has been posting wall-to-wall articles about thousands of apartment units being built. Are there really more workers than work? If so, then whence the 200K shortage?
Donk, An economy can’t be floated building chicken coops and shanties. There’s 100 million able bodied unemployed and chronically underemployed out there.
HA, Ha, ha! Yes, and they all don’t live in the 25,000,000 foreclosed and vacant houses. You are a laugh a minute HA!
or get rid of welfare and 99 weeks of unempl bennies
Didn’t the 99 week thing expire years ago? You know, because unemployment is officially “low”
It’s remarkable he’s lasted so long in this position. He must be quite good at his job, which seems to have very little to do with economics and a great deal to do with the dissemination of propaganda.
Reposting this from a few days ago
http://www.visualcapitalist.com/all-of-the-worlds-money-and-markets-in-one-visualization/
Got $600 trillion? LOLZ
The IMF, funded mainly by US taxpayers, lent billions to Greece knowing full well the Greeks had neither the capability nor the intent to repay the “loan.” Heckova job, banksters.
http://www.counterpunch.org/2017/02/21/finance-as-warfare-the-imf-lent-to-greece-knowing-it-could-never-pay-back-debt/
Thousand Oaks, CA Housing Prices Crater 8% YoY
http://www.movoto.com/thousand-oaks-ca/market-trends/
Oh noez! Kicking out illegals and other grifters might cause housing prices to crash:
http://www.zerohedge.com/news/2017-02-22/could-trumps-immigration-ban-cause-another-housing-crash
32yo engineer and biomed eng. wife making an offer on a 900K house? Guy should be happy he’s dodging that homeless infested, urine smelling and extremely overpriced bullet.
Probably was going to bring their 52 relatives over and get them all on welfare so they can help with the payments. Oh well, back to India, where cattle roam in the streets, next to the corpses in the gutter.
MMMMAAAA-GGGGGAAAAA!
‘Mexico reacted with anger on Wednesday to what one official called “hostile” new U.S. immigration guidelines as senior Trump administration envoys began arriving in Mexico City for talks on the volatile issue.’
‘The U.S. Department of Homeland Security unveiled plans on Tuesday to consider almost all illegal immigrants subject to deportation, and will seek to send many of them to Mexico if they entered the United States from there, regardless of nationality.’
‘Mexico’s lead negotiator with the Trump administration, Foreign Minister Luis Videgaray, said there was no way Mexico would accept the new rules, which among other things seek to deport non-Mexicans to Mexico. “We also have control of our borders and we will exercise it fully,” he said.’
That’s kinda rich, Luis.
32yo engineer and biomed eng. wife making an offer on a 900K house?
In Fremont, too. Jesus, people are stoopid.
An MT Skull results in MT pockets.
I can’t get my test socket design worked on quickly because my vendor has a shortage of engineers.
I think they just don’t want to pay
Also in most tech jobs (Software + Hardware) you don’t need a freaking engineering/science/math degree.
I must be getting old. Engineering, science and math are now excluded from “technology”.
Maybe there’s a difference between tech and technology.
That must be it. Like the difference between Doc and Doctor.
Tech job in today’s vernacular is IT jobs dominant in the valley and everywhere else.
Largely because anyone with basic math skills wouldnt work for these so-called “tech” companies after reviewing their balance sheet or annual report. Especially the blue chips ones, like IBM - just a complete fraud, dead man walking. Anyone with a brain gets out while they still can.
And software and hardware jobs dont need a degree? You think high school is sufficient nowadays? You need to get out of the cave more often, things have come a ways since they came up with fire dude.
Great stuff there, junior. Reminds me of the story about the Windows Vista debacle.
One of my boxes at home is an old Windows Vista box. It’s never given me trouble, not one blue screen of death, while my work provided Win 7 laptop has blue screened twice in less than a year.
Did you see Tesla’s latest cash flow numbers?
They are bleeding cash like never before in their entire history, and have also borrowed more money than ever.
No way that this could ever end badly, LOL!
Meanwhile, Tesla’s market cap is approaching Ford’s. Never mind that Ford is profitable and sells an order of magnitude more cars than Tesla.
I agree, Blue. Traditional engineering, science, and math get almost no respect these days. I still remember being stuck on a shuttle bus and having to listen to the Millenial yahoos Silly-Valley talk about how apps and “content” were going to save the world.
Apps and content, my butt. Do they have ANY idea how many *real* scientists and engineers they depend on just to keep power flowing without blowing something up or fizzling out the electrical grid? Take away the electrical grid and watch the snowflakes melt. Bitcoin too, btw.
Indeed. Writing code that will be around for decades (like say the avionics in an airliner or an operating system kernel) and will have to be bulletproof is much harder than creating some inane mobile app, but if you’re lucky and the app is a hit you might get rich off your stock options at the start up, even though said app might end up forgotten in a few years.
I thought GE lampooned this pretty well:
https://www.ispot.tv/ad/AV0h/general-electric-whats-the-matter-with-owen-big-news
Sorry, this is the better one:
https://www.ispot.tv/ad/AVck/general-electric-whats-the-matter-with-owen-zazzies
What do you mean by test socket design? Discussing sockets is a relatively low level part of TCP implemented by the OS with various languages implementing features on top of the OS.
my net worth is positive today.
Where’s the tennis boy?
He’ posted something up above today.
Aww, jeebus, that picture is priceless. I nearly killed myself laughing.
Labor Force Participation Rate Plummets To 30 Year Low; Joblessness At Record High
https://data.bls.gov/timeseries/LNS11300000
40 years since the Hanson brothers were “puttin’ on the foil” in “Slap Shot”
https://www.youtube.com/watch?v=VHMi-j7W2gM
California Housing Demand Plunges 15% YoY On Growing Housing Oversupply
http://files.zillowstatic.com/research/public/State/State_Turnover_AllHomes.csv
Controlling capital flight from China is like herding cats.
It appears that import invoicing fraud has morphed into export payment fraud. The money still leaks out.
http://www.baldingsworld.com/2017/02/23/changing-nature-of-chinese-capital-flight/
OT
a couple if lefties on this board were pitching TAN n FAN etfs= Butt n Hurt
buy hey, what’s not over priced?
Big doings today, accompanied by the stamping of many little feet from south of the border, the lamestream media and feral youts.
There is some major feet stamping south of the Rio Bravo.
I mean, HOW DARE the USA deport illegal immigrants!?
Meanwhile, Mexican immigration arrests, robs, beats and then immediately deports Central Americans who enter Mexico illegally.
Also, I would strongly discourage anyone from visiting Mexico, even the resort towns. In addition to the chronic lawlessness and its inherent danger, there is now an intense hatred of all things American.
And then there is the BS about unaccompanied minors. Riiiiiight, some 8 year old child, all alone, embarks on a trip from southern Mexico or Central America, crossing the Mexico/Guatemala border, making their way across a hostile Mexican country side, traveling over a thousand miles, without being kidnapped, robbed or worse. Then they manage to cross the US/Mexico, all by themselves.
What a crock.
ATT BEN
cc oxide,ethan N VA dwellers
a slick office building in Fairfax,va that sold for $280 sq.ft in 2011 just sold for $65 a 76% hair cut
=?
Armageddon
just a blip?
que’?
There’s a CRE bust upon us, it’s happening. That’s why I’m loading the guns. The first article in this post points the way..
My memory’s a little fuzzy, but it seems to me that CRE lead the way down during the last bust. I remember seeing some newly built strip malls and plazas around here about 2/3 empty at the time.
Ben when you say CRE is busting, do you mean office space or commercial apartments? I know you wanted to snap up apts, but I didn’t think offices were your specialty.
You couldn’t give me an office building.
‘The term commercial property (also called commercial real estate, investment or income property) refers to buildings or land intended to generate a profit, either from capital gain or rental income.’
‘Commercial property includes office buildings, industrial property, medical centers, hotels, malls, retail stores, farm land, multifamily housing buildings, warehouses, and garages. In many states, residential property containing more than a certain number of units qualifies as commercial property for borrowing and tax purposes.’
‘Multifamily – This category includes apartment complexes or high-rise apartment buildings. Generally, anything larger than a fourplex is considered commercial real estate.’
https://en.wikipedia.org/wiki/Commercial_property
“You couldn’t give me an office building.”
The ones I know of that do well require a lot of hours from more people than you would think.
The ones I know of that seem to have a lot of turnover and vacancies are understaffed and slow to respond to problems.
Ben, if it’s not an imposition to ask, what vintage/level/area of multifamily are you pursuing? Core large city, small town, 4-plex, 6 unit and above?
A former colleague used to describe his units as “something I would have lived in during college.” He went to college in the late 80s, so it was nothing like what is lavished on college kids today…
‘Exxon Mobil Corp. disclosed the deepest reserves cut in its modern history as prolonged routs in oil and natural gas markets erased the value of some North American fields.’
‘The equivalent of about 3.3 billion barrels of untapped crude was removed from the so-called proved reserves category in Exxon’s books, the Irving, Texas-based explorer said in a statement. The revision, triggered when low energy prices made it mathematically impossible to harvest those fields at a profit in the near future, included oil sands in western Canada and gas fields in the Rocky Mountains.’
‘The change amounts to the largest annual cut since at least the 1999 merger that created the company in its modern form, according to data compiled by Bloomberg. The previous record cut was a 3 percent reduction taken during the height of the global financial crisis in 2008.’
‘Murica has become Landlord Land, thanks to the Fed and its trillions in QE lavished on Wall Street.
http://wolfstreet.com/2017/02/23/whos-driving-this-new-normal-housing-market/
‘as institutional investors stepped back, smaller investors jumped into the fray in large numbers, “willing to purchase in a wider variety of market landscapes and operate on thinner margins.”
‘To approximate total investor purchases of homes, the report looks at the share of purchases where the home is afterwards occupied by non-owner residents. In 2009, according to this metric, 28% of all home purchases were investor-owned properties. In 2010, it rose to 30%. In 2011, 32%. Then as big investors pulled out, it fell back to 30%. But by 2015, small investors arrived in large numbers, and by 2016, investor purchases jumped to 37%, an all-time high in the ATTOM data series going back 21 years.’
‘So when the industry tells us about low inventories and strong demand in the housing market, it’s good to remember where a record 37% of that demand in 2016 came from: investors, most of them smaller investors. And when the financial equation no longer works for them, they’ll pull back, just like institutional investors have already done.’
‘In what are now deemed the most expensive multifamily rental markets in the world – San Francisco and New York City – the commercial property bubble is already deflating. Read… Here are the Top “Sell Markets” in an Overpriced World as “the Apartment Cycle Draws Closer and Closer to the End”
Organic housing demand left the market in 2002.
Colorado Housing Demand Plummets 22% YoY
http://files.zillowstatic.com/research/public/State/State_Turnover_AllHomes.csv
You’re on crack. Rents have never been higher here.
Are you sure?
Denver, CO Rental Rates Crater 5% YoY
https://www.zillow.com/denver-co/home-values/
Ben,
You’ve got to get these fools under control.
Your blog is becoming almost worthless by way of the sorting through the misanthropic tirades and name calling.
Your
sad sack six
Loud obnoxious members are tainting the site to the position of an actual taint.
Draw in the reigns a bit.
Housing….. It’s all about housing.
Houston, TX Housing Prices Crater 10% YoY
https://www.zillow.com/houston-tx/home-values/
You had me at “misanthropic” dipsh#t.
Why don’t you try this…
https://www.youtube.com/watch?v=5FjWe31S_0g