Wall Of Global Capital Continues Searching For Yield
A report from the Colorado Real Estate Journal. “In advance of the Emerging Trends in Capital Markets conference, I posed some questions on capital markets for Pete Schippits, senior managing director and market leader for the Colorado Region of CBRE. Q: How do the capital markets in Denver stack up against other markets across the U.S.? Schippits: With a lack of suitable alternatives, much of today’s ‘wall of global capital’ continues searching for yield in U.S. commercial real estate. This has pushed many foreign and domestic investors out of the gateway markets and into strong secondary markets like Denver, Atlanta, Seattle and others. Last year multifamily dominated Denver commercial real estate investment sales, making up 63 percent of the total $10.1 billion in volume.”
“However, on the fundamentals side (e.g., rents/occupancy/NOIs), there will be areas of softness in all sectors. For example, downtown multifamily fundamentals are flat due to significant supply headwinds.”
The Detroit Free Press in Michigan. “So many new residential units are being built in the greater downtown Detroit that the question naturally arises: Are there really people to fill them all? Businessman Dan Gilbert’s Bedrock real estate arm has at least 1,500 new residential units either under construction or in near-term planning in the greater downtown area. The total of new apartments and condos either recently opened, under construction or in planning pushes toward 5,000 units. And that in a downtown virtually abandoned as recently as 15 to 20 years ago. Many developers scoff at the idea that the greater downtown is getting overbuilt.”
“Aside from the residential market, the downtown boom has raised some fears of overbuilding in other markets. So many new restaurants have opened in and around downtown recently that a bubble probably exists. By the standards of many other post-industrial cities, Detroit is still just beginning its comeback. ‘Of course we’re going to have as many people living in our downtown as Cleveland, and we’re a third of the way there,’ said David DiRita, a partner in the Roxbury Group, which has completed several projects.”
“So fears of overbuilding the downtown area may be premature, at least for now. The next recession might chill things, sharply rising prices could dent demand, and marginal projects with dicey financing can always go bust. But even citing those possibilities feels like a silver lining looking for a cloud. For now, the end of the downtown residential boom still looks a long way off.”
From the Centre Daily in Pennsylvania. “Penn State has reported that its undergraduate and graduate student enrollment at University Park is basically flat, but student housing complexes are being built all over the Centre Region. So what’s happening? Looking at the numbers of new student housing being built, it definitely outpaces both student enrollment and population growth, said Jim May, Centre Regional Planning Agency director.”
“CRPA’s opinion is that developers still think there’s a market here for student housing, he said, and generally, developers are going to do a market study for their projects to get financing and make sure that the projects will work. ‘We’re not quite sure what’s happening in the rest of the market. Our initial impression is people are just simply moving around to newer places. Maybe some of the older units are just having two or three students rather than four or more students,’ May said.”
“About five or six years ago, after the economy started to recover, May said people were looking for new places to put their money. Institutional investors saw it as an opportunity to put money into student housing. Additionally, he said the Centre Region’s housing is older and so the new complexes being built are updating the housing stock to be more in line with students’ and parents’ expectations. May said it’s hard to say whether the market’s been saturated yet. But he said he thinks there’s still room for more growth for a least a few more years. ‘This region has always had a very low vacancy rate,’ he said.”
“The vacancy rate for rental units in the Centre Region is 9 percent, but almost one-third of those are ’seasonal, recreational or occasional,’ according to the Centre Region State of Housing Report 2016 — prepared by CRPA and the most recent available.”
“The majority of vacant rental units — 1,427 — are rented but not occupied, according to the report. There are 210 units that are for rent and vacant.”
From Bisnow. “There are many more jobs nationwide now than qualified people to fill them, and that is a drag on the health of U.S. commercial real estate. ‘Labor shortages result in higher vacancy rates, lower asking rents and greater concessions across markets,’ JLL’s ‘Where Are All The Workers?’ report said. Moreover, the impact isn’t just on the office sector, but also on industrial, retail and apartments. There is also a geographical mismatch between where available jobs exist and where potential labor lives. Increasingly, jobs are becoming concentrated in major metropolitan areas.”
“Theoretically, labor could relocate, but as a practical matter, there are barriers to entry for workers — especially the high cost of residential real estate in major metros.”
From The Real Deal on California. “It’s been nearly sixth months since construction wrapped up at Century West Partners’ luxury apartment building in Koreatown. But even with leasing in full force, one subcontractor isn’t going away. A company hired to install drywall at Next on Sixth in Koreatown is suing the development’s contractor, developer and lender for $315,000 in unpaid work, according to a complaint filed last week in Los Angeles County Superior Court.”
“In the lawsuit, San Dimas-based Rockwall Drywall, alleges the contractor, Cobalt Construction, still owes the money for its work on the 398-unit building at 620 South Virgil Avenue. The complex includes units with 9-foot ceilings along with amenities that include a resort-style pool, rooftop grills and a lounge. The seven-story complex, located on the corner of Sixth and Virgil, features a Target retail store on the ground floor, as well as a fitness center, coffee bar, screening room and an indoor simulated golf range. It includes a mix of studio, one-, and two- bedroom units.”
“Century West bought the site in March 2014 for $20.8 million, according to Real Capital Analytics. The firm, led by Michael Sorochinsky, also developed the three-building ‘K2LA’ in the same neighborhood. It’s also behind several residential complexes in Santa Monica and a retail development on Broadway, among others.”
From Mansion Global on New York. “Manhattan’s ultra-luxury rentals cooled off in April, with both the median and average rents for those leases—priced at $15,000 a month and more—posting double-digit declines, according to data compiled for Mansion Global by real estate appraisal firm Miller Samuel. There were 52 ultra-luxury leases signed in April, unchanged from the same period last year. However, the median rent fell 11% to $18,250 per month, while the average rent was also down 10.6% to $21,177, according to Jonathan Miller, chief executive of Miller Samuel.”
“When taking into account landlords’ concessions, Manhattan’s high-end rental market actually was weaker than a year ago, according to Mr. Miller. About 41.4% of all luxury leases in April had a concession, compared to 29.3% in April 2017. Meanwhile, the average concession reached an equivalent of 1.3 months of free rent, rising from 1.2 months a year ago, according to Mr. Miller. The majority of rental developments built over the last five years ’skewed toward luxury, and oversupply in this market forced landlords to offer concessions in order to keep vacancy rate low,’ Mr. Miller said.”
From The Real Deal on New York. “Concessions in Manhattan earned yet another superlative last month, rising to the third highest market share recorded in the past seven-and-a-half years. The share of new leases with concessions hit 44.3 percent in April, up from 28.6 percent at the same time last year, according to Douglas Elliman’s latest market report.”
“Jonathan Miller, author of the Elliman report, noted that concessions were prevalent throughout the market, not just the high end. For instance, 38.3 percent of newly leased studios and 45.9 percent of one-bedrooms apartments came with concessions. At the entry-level sector of the market, concessions are offered because landlords are being too aggressive in driving up rents, Miller said. On the high-end, climbing inventory is the primary reason landlords are offering concessions to renters.”
“‘Somewhat different reasons, but the same result,’ Miller said. ‘The concessions are the vehicle to bridge the gap between landlords and tenants.’”
‘developers still think there’s a market here for student housing, he said, and generally, developers are going to do a market study for their projects to get financing and make sure that the projects will work. ‘We’re not quite sure what’s happening in the rest of the market.’
That’s why you make the big bucks Jim.
‘About five or six years ago, after the economy started to recover, May said people were looking for new places to put their money. Institutional investors saw it as an opportunity to put money into student housing.’
‘There are many more jobs nationwide now than qualified people to fill them, and that is a drag on the health of U.S. commercial real estate. ‘Labor shortages result in higher vacancy rates, lower asking rents and greater concessions across markets,’ JLL’s ‘Where Are All The Workers?’ report said. Moreover, the impact isn’t just on the office sector, but also on industrial, retail and apartments.’
Too many cocktail parties.
There are many more jobs nationwide now than qualified people to fill them
I also saw that article the other day. It’s pure BS. If it was true, employers would hire the first competent candidate they could find. But that’s not happening. Instead there is a deluge of qualified applicants and employers take their sweet time to pick the very best one.
A former San Diego colleague had to settle for a 6 month contract gig, after searching for almost 5 months after being laid off.
I remember the dot com days. As long as you weren’t utterly incompetent you could find a new, full time job with benefits after searching for just a few weeks, with the offer arriving just a few days after the interview and not weeks or even months later.
There is no shortage of candidates.
There’s that. But to blame rent concessions and vacancies on unfilled jobs shows the quality of these “experts.” Is it any wonder they are building like there’s no tomorrow?
What’s a few million more excess empty houses on top of the 25 million empty housing units out there?
But to blame rent concessions and vacancies on unfilled jobs shows the quality of these “experts.”
That too. It just goes to show that their projections are worthless.
I don’t even want to think about the city that “wins” the Amazon HQ2 lottery. They’ll start building like crazy, only to find out that Amazon’s hiring numbers were a gross exaggeration.
LOLZ I walked out of a job interview (with one of the 2 company owners) at 4:15pm on a Monday and the offer letter was in my email inbox at 10:00am Tuesday.
I wonder if these guys are hiring:
‘It’s been nearly sixth months since construction wrapped up at Century West Partners’ luxury apartment building in Koreatown. But even with leasing in full force, one subcontractor isn’t going away. A company hired to install drywall at Next on Sixth in Koreatown is suing the development’s contractor, developer and lender for $315,000 in unpaid work’
I wonder if these guys are hiring:
If they are “hiring” they don’t seem to be “paying”.
“There is no shortage of candidates”
No, there is not but the globalists have to justify immigration to say there is a shortage. You wonder if they just advertise these jobs to Americans so they can claim after a while that they could not fill the position with an American. They had no intention to fill the position at least at a market rate. Then, after not filling it they can use a H1-B permit. The person whom they hire with that permit can then be trained and might even be sent back to his or her home country to create an offshore unit. Globalists gaming our system.
Arlington, VA Housing Prices Crater 5% YOY
https://www.zillow.com/arlington-va/home-values/
*Select price from dropdown menu on first chart
‘Of course we’re going to have as many people living in our downtown as Cleveland, and we’re a third of the way there’
Always aim high David:
When you wish upon a star
Makes no difference who you are
Anything your heart desires will come to you
If your heart is in your dream
No request is too extreme
When you wish upon a star
As dreamers do
Fate is kind
She brings to those who love
The sweet fulfillment of their secret longing
I just got this email:
Ginnie Mae today announced that issuance of its mortgage-backed securities (MBS) totaled $34 billion in April.
A breakdown of April issuance includes $32.437 billion of Ginnie Mae II MBS and $1.631 billion of Ginnie Mae I MBS, which includes $1.446 billion of loans for multifamily housing.
MBS issuance for Fiscal Year 2018 to the end of April totaled $251.017 billion. Ginnie Mae total outstanding principal balance of $1.950 trillion is an increase from $1.819 trillion in April 2017.
About Ginnie Mae
Ginnie Mae is a wholly-owned government corporation that attracts global capital into the housing finance system to support homeownership for veterans and millions of homeowners throughout the country. Ginnie Mae mortgage-backed securities (MBS) programs directly support housing finance programs administered by the Federal Housing Administration, the Department of Veterans Affairs, the HUD Office of Public and Indian Housing, and the Department of Agriculture Rural Housing Service. Ginnie Mae is the only MBS to carry the explicit full faith and credit of the United States Government.
Indian housing?
How
Any down payment required?
Sea shells,wampum
Realtors are liars.
I forgot the poem. It’s been a long time
First Quarter Performance Shows US Apartment Market Coming Back to Earth Rent Growth Expected to Moderate as Home Ownership Ticks Up
The high-flying apartment sector, which led all other property types in the economic recovery and became the darling of investors, is coming back to earth.
CoStar’s first quarter multifamily review and forecast predicts apartment rents will still increase but at a much slower pace and, in some markets, occupancy rates for multifamily properties will stall.
One factor in the moderating demand for apartments has been a change in homeownership rates. During the current economic expansion, a decline in homeownership resulted in a growing pool of renters, even as household formation remained strong. But that trends seems to be over now. Homeownership rates, although still historically low, are ticking back up, taking hundreds of thousands of current renters out of the apartment market.
It remains to be seen what effect rising interest rates may have on homeownership rates.
CoStar Group’s first quarter report details the decelerating fundamentals in what has been the star of commercial real estate. The group’s webinar is available in the Knowledge Center at http://www.costar.com.
“The cycle is long in the tooth at this point,” said John Affleck, research strategist for apartments at CoStar. “And the likelihood of a recession in the next few years is a growing possibility. This cycle has been one of the longest in history.”
Should a recession hit, the apartment market is likely to have a soft landing, according to CoStar’s analysis. New construction is set to taper off in the next year, and home ownership is unlikely to return to the pre-recession high of 69 percent of households, leaving a large number of potential renters.
But for multifamily investors and developers, the days of being able to underwrite most properties at 4 percent or 5 percent annual rent growth are likely over. Nationwide, year-over-year rent growth averaged 2.5 percent over the past 12 months ended in March 2018. That growth rate could flatten to as little as 1 percent by 2020.
Several major markets that have added thousands of new units, including Dallas, San Francisco, Chicago, Washington DC and New York, all saw year-over-year rent growth of less than 2 percent in first quarter, according to CoStar research.
And CoStar forecasts that many big markets will see annual rents increase little by year-end. San Francisco’s rents are projected to grow an average of only .8 percent by year-end. Chicago (.7 percent); Washington, D.C. (.7 percent); and New York (.7 percent) should also annual growth of less than 1 percent.
On the flip side, Orlando, with a 6.8 percent average rent increase in the last 12 months, is the leading apartment market for rent increases. Las Vegas (5.8 percent); Sacramento (5.5 percent); Jacksonville (4.9 percent) and the Inland Empire (4.8 percent) round out the top-five markets for rent growth.
But investors still seem to have faith. Sales of multifamily properties were up 10 percent year-over-year in the first quarter, according Lee Everett, senior managing consultant for CoStar Portfolio Strategy. And looking forward, Everett forecasts that rents for mid-quality 3-Star and workforce housing properties are expected to increase and a larger percentage than the top-end 4 and 5-Star rentals. That should attract investor attention.
‘CoStar’s first quarter multifamily review and forecast predicts apartment rents will still increase but at a much slower pace and, in some markets, occupancy rates for multifamily properties will stall.’
This is what doomed these guys. After all the reports we’ve seen of falling rents, skyrocketing vacancy and slow to negative absorption, now they make this huge call?
Softpedalling and feathering while real money bails…. Then the Donkey Stampede begins.
Can I get a footstamp from a DebtDonkey please….
https://www.youtube.com/watch?v=JVG957gzYK8
Hey Donk
2banana’s Law in action…
++++
An “Audible Gasp” Was Heard When The Chicago Fed Unveiled Its “Solution” To The Pension Problem
ZeroHedge - 05/14/2018 - 03:45
An audible gasp went out in the breakout room I was in at last month’s pension event cosponsored by The Civic Federation and the Federal Reserve Bank of Chicago. That was when a speaker from the Chicago Fed proposed levying, across the state and in addition to current property taxes, a special property assessment they estimate would be about 1% of actual property value each year for 30 years.
Homeowners with houses worth $250,000 would pay an additional $2,500 per year in property taxes, those with homes worth $500,000 would pay an additional $5,000, and those with homes worth $1 million would pay an additional $10,000.
Is the Chicago Fed blind to human consequences? Confiscatory property tax rates have already robbed hundreds of thousands, maybe millions, of Illinois families of their home equity — probably the lion’s share of whatever wealth they had.
Property taxes in many Illinois communities already exceed 3%, 4% and even 5% of home values. Across Illinois, the average is a sky-high 2.67 percent, the highest in the nation.
Don’t they understand that people won’t build on or improve property when property taxes are that high? When taxes are 3 percent to 6 percent, any value you add to your home is going to be taxed at that high rate forever. Have they never been to our communities with countless disrepaired, abandoned homes and commercial properties, which are the result?
In other words, just confiscate wealth from current owners because they will pay, whether they stay or not, through an immediate reduction in home value.
This proposed tax would only address the five state pensions. What about the other 650-plus pensions in Illinois, particularly those for overlapping jurisdictions in Chicago which are grossly underfunded? The Fed was asked that at last month’s seminar and they, without explanation, said they didn’t bother to cover that.
Property can’t leave, so seize it. That’s the basic idea.
the tried to raise retirement age and back track it to age 45. When the courts stopped it it was doom for IL
Pensions are also tied to OT
++++++
Metra Overtime Soars To $119 Million From 2013 To 2017; One Mechanic Earned $366,000 (Chicago)
CBS Chicago | May 10, 2018 at 10:20 pm | Brad Edwards
A Metra track inspector and two mechanics have been paid a total of $1.2 million in overtime in the past five years.
That payout, one lawmaker tells 2 Investigator Brad Edward, is out of control.
“There’s excessive overtime being paid,” says State Rep. David Olsen (R-Downers Grove). “That creates mistrust from taxpayers.”
In all, Metra’s overtime costs soared above $119 million from 2013 to 2017, according to interviews and records. 2 Investigators counted 351 employees who earned at least $100,000 in that span. Topping the list is a mechanic who earned more than $366,000 in overtime.
This should be front page news on every paper in the USA. However I anticipate the actual resulting silence to be deafening.
This is the “fundamantal transformation” you were promised.
It should be obvious that every libtard controlled city or state is driving their municipality to bankruptcy a la thelma and louise and that its by design. So what do they hope to achieve? They get rid of the middle class for one - marxists hate them - leaving a slave class and some parasitic thugs (to do their dirty work) to be lorded over by the shylocks who, after doing this in enough states will have a lock on the senate. Add to this their love of illegals and they will take the house of reps via a soft invasion - this is probably the soros/*berg/(((tribe))) long game theyre playing in order to destroy the country.
The SPLC reads this blog. This isn’t 4chan here.
‘
And if this was the UK, you’d probably be in jail already, LOLZ.
House by house fighting as the front line draws closer to Manhattan…
+++++
New York Rents Plunge 12% In Queens
ZeroHedge - 05/13/2018
Rents there dropped 12 percent from a year earlier, to a median of $2,646 a month after landlord giveaways were subtracted, according to a report Thursday by appraiser Miller Samuel Inc. and brokerage Douglas Elliman Real Estate. Those giveaways were offered on 65 percent of all new leases signed in the area, excluding renewals, a record share in data going back to the beginning of 2016.
“More customers who were originally looking in Manhattan and Brooklyn are considering Queens,” said Hal Gavzie, Douglas Elliman’s executive manager of leasing. “It used to be just 100 percent a different consumer.”
In Manhattan, 44 percent of all new leases came with a landlord concession, such as a free month of rent or payment of broker fees. In Brooklyn, the share was 51 percent, a record for the borough.
This comes just about one month after we reported about downtown Manhattan basically turning into a ghost town due to just the opposite - prices rising and government overreach. Pricing out of tenants in some main downtown areas and shopping districts have caused vacancies in areas that have been occupied for decades.
If you want to see the future of storefront retailing, walk nine blocks along Broadway from 57th to 48th Street and count the stores.
To be sure, none of this comes as a surprise to us - or our regular readers - because in late March we recalled our own 2009 tour of Madison Avenue to discover that it also had turned into a ghost town. Just a week ago we told our readers that the ghost town that was New York’s “Golden Mile” was not surprising: after all the US economy had just been hit with the worst recession since the Great Depression, and only an emergency liquidity injection of trillions of dollars prevented a global financial collapse.
What is more surprising is why nearly 9 years later, at a time of what is supposed to be a coordinated global recovery, a walk along Madison Avenue reveals the exact same picture.
existing rentals?
wow reup negotiations will be tense
RIC
running ads for reits on the tube
not too desperate
Drone pilots’ pay tumbles 90 percent in race to the bottom
https://www.msn.com/en-us/money/smallbusiness/drone-pilots-pay-tumbles-90-percent-in-race-to-the-bottom/ar-AAxfczn?li=BBnbfcN
This is what happens in a mania: everyone jumps in, and prices fall.
Almost like Network “engineers”
And Bitcoin “miners”
Traveling in the NYC area.
Quite a few radio commercial for real estate investments.
“Guaranteed” 20% returns!
“Guaranteed” 25% returns!
With falling rents, empty storefronts, insane property taxes and rising interests rates!
Detroit ,go 5 blocks and squat n an abandoned sfh
Why mess w renting an apartment ?
Detroit ,go 5 blocks and squat n an abandoned sfh
Go another 5 blocks and leave your bones to dry in a wrecked SFH.
Big news in the oil markets today. Brent reached $78.40 and WTI reached $70.96. WTI is actually better oil and use to trade at a higher price then Brent. Shale oil has distorted the market. You can actually ship oil pretty much anywhere in the world for four dollars a barrel. You can expect our oil in storage to fall as oil flows to where the price is highest. Over the last year the amount we have in storage including products has dropped 177 million barrels despite rising shale production. Laterals six years ago might go out 2500 feet now with some Wells they go out 20000 feet. Not the norm but still one well now drains what it use to take four or five to drain. We are running out of drilling places to even drill long laterals. We still have a lot of NG but oil will be played out sooner than many think. The Saudis are not scared of shale oil since they no the truth, peak production is close.
With a globe full of oil and more produced every day, the energy supply is infinite.
The higher the cost of oil goes - the more “reserves” can be found and exploited (because the become cash flow positive)
At a certain price point, making oil from coal (evil!) or algae (green!) is economical
We will never “run out of oil” - but it will become uneconomical at some point
That maybe true 1,000 years in the future but for the next 500 years there’s a globe full of oil and limitless in terms of energy supply.
Actually, there is a limited supply of fossil fuel. It might be more that we will ever consume, but it is certainly not infinite. Even if the entire Earth was made of oil, it wouldn’t be infinite.
Is it any wonder Dan, the oil shill, is back as oil is climbing, yet he was nowhere to be found when it was cratering? We get it, oil pimp.
Sorry I came back prior to oil taking off. You act like I have some control over oil prices instead of being the messenger. I think most people would like information, but I guess ignorance is bliss. Similar people criticize this blog as anti housing when it is just trying to inform people about the risk of overpaying. I am just warning people about buying too big of vehicles etc
‘this blog …is just trying to inform people about the risk of overpaying’
How many times have I encouraged people to buy three shacks. Heck, make it five. I don’t care. I got that way listening to gambling fools for too many years. A lot of people talk about blame. We wouldn’t be in this situation, central banks or no, if the public in general weren’t so greedy for an easy buck. This blog is about the housing bubble. The end.
Amen, Ben. When all this started back in the early 2000s, I was talking to some leasing agent about renting an apt. She started blabbing about how she and her husband had contracted to build a townhouse - but by the time it was finished, it had already appreciated 50k - She was giddy when she told me — So we sold it!!! I was angry with that response - which of course made me the loon in her eyes. When I had to go back to finish my lease, she said - oh I just figured you were having a bad day before.
THEY DON’T GET IT AND THEY NEVER WILL. Greed is intoxicating to most people.
“The end.”
And good night Irene.
When youve got empty pockets, everything appears to be worth 500% more than reality.
” if the public in general weren’t so greedy for an easy buck”
I have to defend the public in general here. Look, American life has been sucking more and more. Few benefits, lots of 3-6 month gig work, everyone is living with mom and they still need a side hustle. Easy low-skill jobs you could get with a GED are now being taken immigrants who live third-world lifestyles on Uncle Sam’s dime and a food bank nickel. Even a good STEM job requires a demanding and expensive college degree which many people can’t afford, and still doesn’t guarantee more than a 5-year job and you’re still competing with H1-B and Apu in Mumbai.
Even hard work isn’t bringing in a buck, not consistently. I can’t really blame people for wanting to get ahead somehow. Of course, they were stupid, and the ones who loaded up on houses deserve to lose them, but I don’t know if this is all pure greed. Maybe it’s the only way to survive.
(same mentality for bitcoin etc)
Black swan buy a F-350 and then buy a big house, do not worry just drive until you can just barely make the payments by working copious amounts of overtime. Just go as big as you can that is how you wil make the big bucks. Do not listen to people that talk about peak oil. They are just trying to get people on this blog to buy oil since the people that could be persuaded to buy on this blog could really move the price of oil. Since there are billionaires on this blog who have no access to market research.( Sarcasm off). Actually, I do think influential people do monitor this blog but they would not follow anonymous advice. They want to know what the people who are not in the .1 percent can figure out.
^^Is this what butthurt looks like?
Oil is indirectly linked to the housing bubble in that the tried-and-true mantra of “drive ’till you qualify” has people building and buying farther and farther away from their job. When you consider that fuel efficiency regs have been rolled back and Americans have been sucked back into the truck/SUV trap, any big run up in gas prices has a disproportionate effect on consumer spending. I read a headline in USA today that the higher oil prices is undoing the impact of the Trump tax credit for a decent swath of middle-income Americans.
I think Dan is right to warn us about the perils of gas guzzlers. Combined with a housing bubble, it is a double whammy.
“I think Dan is right to warn us about the perils of gas guzzlers. Combined with a housing bubble, it is a double whammy.”
No matter the reasons, no matter the consequences… every country rescues their automobile industry.
“I read a headline in USA today that the higher oil prices is undoing the impact of the Trump tax credit for a decent swath of middle-income Americans”
Giveth to fa$le Profit$ what belongs on to them, Giveth to the 1%ter$ what belong$ to the! … & the beat the goe$ on, & the beat goe$ on …
True because it is so tied to economic activity. However, due to large NG reserves and our work with electric vehicles we do not need to tie our future to gasoline guzzling vehicles. Obama missed an opportunity to use NG as a bridge fuel to electric vehicles. Mainly through private initiative a network to fuel NG fueled large trucks has been built. With a little governmental help we can run SUVs and other passenger vehicles on NG. We can Eliminate the need for oil imports and improve the environment until electric cars can be recharged faster and the batteries become cheaper. I do not own any stock in such companies although I do own drillers and shares in LNG. It exports LNG so it would actually be hurt if domestic NG prices increased due to widespread adoption. However with diesel at $3.25 a gallon and it’s equivalent selling for $2.25 (NG) it just makes sense. You can produce electricity with solar, wind, hydro or coal, burning a fuel that is easy to use for transportation is not logical, when it clear that oil is running out.
Incorrect. $/1k btu of #2 is far less costly than NG not to mention the failure of electric cars.
Besides, there is a globe full of oil. An endless supply.
Anyone can go online and check a gallon of diesel vs. a diesel gallon equivalent of CNG (DGE) it will vary a little city to city but you will see the large number of fueling stations in the country and the prices or you can take Mafia’s word. The large price advantage disappeared between the summer of 2014 and the fall of 2017 but has comeback with a vengeance. Places like China and California continued to push it due to environmental concerns with last fall China increasing sales 450 percent but it is being pushed in states like Oklahoma and Utah too. It is one of those rare situations where both economics and environment concerns support the conversation. It is similar to when most northeastern homes moved from home heating oil to NG.
Don’t take my word for it, just do the math.
it is being pushed in states like Oklahoma and Utah too.
Very true. One of my favorite local car dealerships (I almost bought a BMW i3 from this guy a few months ago) specializes in CNG sales. We actually have a few of these specialty dealerships that pick up CNG fleet vehicles. As a side note, I read about a guy on lease hacker getting a brand new $50k BMW i3 on a lease for about $53/month due to him stacking all the rebates:
https://www.bloomberg.com/news/articles/2018-05-14/how-to-lease-a-50-000-bmw-for-less-than-a-subway-pass
Denver, CO 80210 Housing Prices Crater 8% YOY
https://www.zillow.com/denver-co-80210/home-values/
*Select price from dropdown menu on first chart
Come for the weed, stay for the heroin and meth. LOLZ
So will it be a heroin needle that pops the housing bubble in Denver?
Supposedly meth is making a comeback. Oh, joy. Tweakers are the scourge of the earth. I’ll take falling down junkies any day over fidgeting tweakers.
I still call a 90 - 95% drop in housing prices within 20 years from now. And no, Manhattan isn’t immune from such a drop either.
And there many skulls yet to be lived in…. Very comfortably so….. And all rent-free.
“94,785,000 Not in Labor Force; At 62.9%, Labor Force Participation Stuck Near 38-Year Low”
https://www.cnsnews.com/news/article/susan-jones/no-records-set-august-number-employed-americans-drops-participation-rate
“much of today’s ‘wall of global capital’ continues searching for yield in U.S. commercial real estate”
There it is in a nutshell.
“Wall of global capital.”
’nuff said.
Are you still buying overvalued equities, even as the Fed is finally following through on punchbowl removal operations?
Seems as stupid as ignoring those volcano evacuation orders that have been issued.
Opinion: S&P 500 should be 1,000-plus points lower than it is today, strategist Rosenberg says
By Olivier Garret
Published: May 14, 2018 12:18 p.m. ET
Gluskin Sheff’s David Rosenberg bases his prediction on sluggish U.S. economic growth and overvalued equities
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Red alert: Eruption warning!
10-year Treasury yield creeps back above 3%
By Mark DeCambre
Published: May 15, 2018 7:36 a.m. ET
Retail sales figures top a heavy data calendar
The yield on the benchmark 10-year Treasury note early Tuesday poked above a closely watched level at 3% and government debt rates broadly climbed along with their European counterparts. The yield advance comes amid resurgent worries that negotiations between the U.S. and China remain challenged, stoking fears that a potential trade clash could push prices and inflation higher—a negative for bonds.
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“With a lack of suitable alternatives, much of today’s ‘wall of global capital’ continues searching for yield in U.S. commercial real estate.”
Yellen bucks seeking their toe-tag homes…
please do not fight the FED anymore.
the roofer roll up stocks are tanking
becn - buildrs first source etc
Kyrie Eleison on the readers of this blog.
No shame for debtors who take out mortgages they can’t possibly repay?
We’re fighting the good fight!
Affordable housing, Hawaiian version:
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One cannot help but wonder why anyone would choose to live on the flank of an active volcano. Leilani Estates is located in a Lava Hazard Zone 1, which means that if you build there it is quite possible, if not inevitable, that your home will be destroyed. The main reason, perhaps, is economics. The Puna region, which includes Pahoa, Kapoho, Kalapana, and Leilani Estates, has among the lowest median home values in the Hawaiian island chain. When I called a realtor, Jessica Gauthier, who sells and manages properties in the subdivision, she told me that Puna has long been one of the most affordable districts in the state. “Housing on the Big Island is already a big issue,” she said. “As people are becoming more aware of beautiful places to live, local residents get pushed out, because people with more money come in.” The eruption, she believed, would make the housing situation even worse. Many families cannot afford to relocate. One man, Paul Campbell, who had lived in Leilani Estates for twenty-six years, told me that if he lost his house he believed he would end up homeless.
And yet, Gauthier said, it did not surprise her that so many had chosen to live in the area. The forest is lush, the land has views of the ocean, and there is “something about the rawness of living on the side of the volcano,” she told me. “When you’re focussed on survival, you’re really attached to what’s important in life. The people. Nature. That’s why we stay.” And, though everyone who lived there knew the risk, it was easy to forget. Morrow told me, “I knew there was potential, but you get complacent.” Campbell said, “You don’t think about it until it comes. It just goes to show you nothing is permanent in this world.”
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Left wing slant on it but still has key facts about the man that has undermined true democracy through out the world. The MSM wants you to focus on the few hundred thousand spent on ads by Russia instead of the hundreds of millions spent by Soros to destroy the constitutional republic which is the U.S.
https://www.yahoo.com/news/george-soros-billionaire-bete-noire-nationalists-153934434.html