Recent Articles
Jan 8, 2010 | No Comments | Sean Mills
We knew it was coming it was just a matter of time as most states are bankrupt and looking to fill the holes one way or another. I think in California we will see an amendment to the old Howard Jarvis Prop 13 legislation seperating residential from commercial in regards to going after an increased [...]
We knew it was coming it was just a matter of time as most states are bankrupt and looking to fill the holes one way or another. I think in California we will see an amendment to the old Howard Jarvis Prop 13 legislation seperating residential from commercial in regards to going after an increased supplemental tax. As you know prop 13 passed in the late 1970’s put a maximum supplemental tax of 2% annually on real estate in California thereby capping the amount the government could receive from property taxes. Other states have left residential alone due to the large public outcry and have gone after the easier pickings of commercial real estate, case in point Iowa. I will go a little farther and to say not just single family residences will be left alone but 1-4 unit properties. Only time will tell.-Sean
Several major commercial real estate groups are fighting a proposed federal tax provision that they say would have a devastating effect on real estate investment partnerships.
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Oct 16, 2009 | No Comments | Sean Mills
Just a little back up for the last post where I issued the warning about the stock market.-Sean
The Dow Jones Industrial Average closed above 10,000 today for the first time in a year, and more than a decade after first breaking the mark. Since hitting lows in March, the Dow is up an astounding 50%, [...]
Just a little back up for the last post where I issued the warning about the stock market.-Sean
The Dow Jones Industrial Average closed above 10,000 today for the first time in a year, and more than a decade after first breaking the mark. Since hitting lows in March, the Dow is up an astounding 50%, while the S&P 500 has gained 60%.
Before you get your broker on the phone or start trading that dormant online brokerage account, take heed of this warning from Mike “Mish” Shedlock, the blogger behind MISH’S Global Economic Trend Analysis: “Five years from now, I think its quite likely the Dow is not going to be much more than 10,000,” he says.
Source Article
Why so negative?
“We’ve still not solved any of those structural problems” in the housing, banking and debt markets, that caused last year’s crisis, he claims.
Shedlock’s advice: ignore the euphoria, and “take some chips off the table. Now’s just not a good time to be invested.”
Shedlock, also an investment advisor representative for SitkaPacific Capital Management, thinks investors are better positioned in gold and cash.
Sep 29, 2009 | No Comments | Sean Mills
S&P/Case-Shiller released their monthly Home Price Indices for July this morning.
This monthly data includes prices for 20 individual cities, and two composite indices (10 cities and 20 cities). This is the Seasonally Adjusted data – others report the NSA data.
Click on graph for larger image in new window.
The first graph shows the nominal seasonally [...]
S&P/Case-Shiller released their monthly Home Price Indices for July this morning.
This monthly data includes prices for 20 individual cities, and two composite indices (10 cities and 20 cities). This is the Seasonally Adjusted data – others report the NSA data.
Click on graph for larger image in new window.
The first graph shows the nominal seasonally adjusted Composite 10 and Composite 20 indices (the Composite 20 was started in January 2000).
The Composite 10 index is off 31.6% from the peak, and up about 1.3% in July.
The Composite 20 index is off 30.6% from the peak, and up 1.2% in July.
The second graph shows the Year over year change in both indices.
The Composite 10 is off 12.8% from July 2008.
The Composite 20 is off 11.5% from last year.
This is still a very strong YoY decline.
The third graph shows the price declines from the peak for each city included in S&P/Case-Shiller indices.
Prices increased (SA) in 17 of the 20 Case-Shiller cities in July.
In Las Vegas, house prices have declined 55.2% from the peak. At the other end of the spectrum, prices in Dallas are only off about 4.9% from the peak – and up in 2009. Prices have declined by double digits almost everywhere.
The debate continues – is the price increase because of the seasonal mix (distressed sales vs. non-distressed sales), the impact of the first-time home buyer frenzy on prices, and the slowdown in the foreclosure process (with a huge shadow inventory), or have prices actually bottomed? I think we will see further house price declines in many areas.
I’ll compare house prices to the stress test scenarios soon.
Source Article
Sep 22, 2009 | No Comments | Sean Mills
Southern California Apartment Association Trade Show on 09/30/2009
The largest rental housing education and networking event is just around the corner. September 30, 2009 is the date for California’s largest rental housing expo to be held at the Long Beach Convention Center from 9:00 AM to 5:00 PM in Exhibit Hall B.
The event is designed and [...]
Southern California Apartment Association Trade Show on 09/30/2009
The largest rental housing education and networking event is just around the corner. September 30, 2009 is the date for California’s largest rental housing expo to be held at the Long Beach Convention Center from 9:00 AM to 5:00 PM in Exhibit Hall B.
The event is designed and managed by The Apartment Association, California Southern Cities, and looks to be another great day with loads of free information on owning, managing and dealing with apartment housing.
You can discover and learn about all sorts of topics by browsing trade show booths, attending educational programs that will cover topics such as:
- Secrets to Creating Wealth
- Credit Checking in Today’s Market
- Covering Your Legal Bases
- Profitable Employment Practices
- Social Networking 101
- How to Rent to Today’s Tenants (Panel)
- Taking Advantage of a Depressed Real Estate Market
- How to Cut Costs and Put More $$$ in Your Pocket
- Solutions to the Water Problem for Owners (Panel)
- Fair Housing Conversation
- Resident Retention Techniques
- and much, much more…
Sep 22, 2009 | No Comments | Sean Mills
Sept. 21 (Bloomberg) — The recovering housing market may be heading for a relapse as President Barack Obama and Federal Reserve Chairman Ben S. Bernanke consider ending support for the source of the global financial crisis.
The Obama administration is studying whether to let a first-time home buyers’ tax credit expire as scheduled at the end [...]
Sept. 21 (Bloomberg) — The recovering housing market may be heading for a relapse as President Barack Obama and Federal Reserve Chairman Ben S. Bernanke consider ending support for the source of the global financial crisis.
The Obama administration is studying whether to let a first-time home buyers’ tax credit expire as scheduled at the end of November. Bernanke and his Fed colleagues may continue talking this week about how to wind down purchases of mortgage- backed securities, according to Peter Hooper, chief economist at Deutsche Bank Securities Inc. in New York. The two programs have helped stabilize real-estate demand, with new-house sales rising 9.6 percent in July from the prior month, the most since 2005.
Ending these efforts may stifle the housing rebound by depressing sales and pushing up both mortgage-backed bond yields and interest rates on home loans, even in the face of the record-low zero to 0.25 percent short-term rates the Fed has engineered, said economist Thomas Lawler. A weaker housing market would likely dampen the economic recovery and undercut shares of builders including Fort Worth, Texas-based D.R. Horton Inc. and Miami-based Lennar Corp., that have risen 40 percent this year, based on the Standard and Poor’s Supercomposite Homebuilding Index of 12 companies.
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Sep 4, 2009 | No Comments | Sean Mills
As Values Decline, Pension Funds Jump Into Real Estate
NEW YORK — The Queens Center Mall doesn’t seem to have followed the dour shopping-center story line of this recession.
Sales per square foot actually ticked up in 2008 to $876, and year-end occupancy stood at 97.5%. In the food court, 20-year-old shopper Mario Ontaneda, wearing a cap [...]
As Values Decline, Pension Funds Jump Into Real Estate
NEW YORK — The Queens Center Mall doesn’t seem to have followed the dour shopping-center story line of this recession.
Sales per square foot actually ticked up in 2008 to $876, and year-end occupancy stood at 97.5%. In the food court, 20-year-old shopper Mario Ontaneda, wearing a cap and jeans he purchased from stores in the mall, said: “I need to save up, but I’m constantly buying stuff.”
The strong performance of Queens Center Mall, located in New York’s borough of Queens, helps to explain why Cadillac Fairview Corp. agreed to pay $150 million and to assume $167 million in mortgage debt to acquire a 49% stake in the mall last week. Cadillac is owned by the Ontario Teachers’ Pension Plan. Macerich Co., the Santa Monica, Calif., real-estate investment trust, sold a stake in the one-million-square-foot mall as part of a broader plan to reduce debt.
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Sep 4, 2009 | No Comments | Sean Mills
The Wall Street Journal Online edition ran this article today. The Reluctant Landlords….shoot out on the west coast we are seeing a move toward real capital to exploit the deficiencies in low price and higher rents. There are even some flocking back into the buy low and flip model, I will wait this one out. [...]
The Wall Street Journal Online edition ran this article today. The Reluctant Landlords….shoot out on the west coast we are seeing a move toward real capital to exploit the deficiencies in low price and higher rents. There are even some flocking back into the buy low and flip model, I will wait this one out. A trend among the bigger real estate brokers is to harvest their top clients, form a vulture fund and go shopping. -Sean
With housing prices still in the dumps, many Americans are finding themselves in the uncomfortable position of landlord.
Some have been forced to relocate for a job and can’t sell their houses. Others have moved, but are holding on to their previous homes, hoping for prices to rebound before selling. Many are finding that rent checks don’t come close to covering their mortgage payments.
Hard data are scant on how many homeowners are renting out their homes, but anecdotal evidence suggests numbers are up. In one indication of the trend: More homeowners are converting their homeowners insurance to landlord policies that cover the additional risks of leasing out a home. Allstate Corp., the second largest home insurer in the U.S., reported a 27% increase in conversions in the first quarter from the previous year.
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Sep 3, 2009 | No Comments | Sean Mills
One of my partners and I were looking very hard at a deal in the Portland area and the biggest stumbling block with the sellers and listing agent was the vacancy rate for the building. Of course they liked a 5% vacancy rate with a building which had an actual YTD vacancy rate of 8.9% [...]
One of my partners and I were looking very hard at a deal in the Portland area and the biggest stumbling block with the sellers and listing agent was the vacancy rate for the building. Of course they liked a 5% vacancy rate with a building which had an actual YTD vacancy rate of 8.9% and current rate approaching 20%. Needless to say we weren’t buyers based on their numbers.
If you want to figure a good rate look at the unemployment rate in the areas you are interested in, for Portland Oregon area that rate is 13.2%. It makes sense vacancies should trail and track the unemployment numbers especially for a blue collar working class building. Well enough of my rant here is an article from the latest issue of Multifamily Executive.-Sean
Rental Owners Report Soaring Vacancies: People Who Lose Homes Move in With Families Instead of Renting Apartments
Aug. 28–Southern Oregon Rental Owners Association reported a 9.4 percent vacancy rate for June, the highest level in the 20 years that the organization has surveyed its members.
“We knew some of our renters couldn’t afford it and moved in with families,” said association manager Roberta Claudson of SOROA, which consists of rental owners with anywhere from a few rentals to hundreds of properties. “We thought it would be balanced out by people who had lost their homes. But apparently, they’ve moved in with families, too.”
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Aug 28, 2009 | No Comments | Sean Mills
It seems to me we are hearing the same old thing from the experts at the conference, hurry up and get ready because now is the time..-
Sean
Halford joined moderator Jeff Moore, senior managing director of CB Richard Ellis Inc.; Brandon Birtcher, president and CEO of Birtcher Development & Investments; Guy Johnson, president of Johnson Capital; [...]
It seems to me we are hearing the same old thing from the experts at the conference, hurry up and get ready because now is the time..-
Sean
Halford joined moderator Jeff Moore, senior managing director of CB Richard Ellis Inc.; Brandon Birtcher, president and CEO of Birtcher Development & Investments; Guy Johnson, president of Johnson Capital; Martin Pupil, executive managing director of Colliers International; and Tom Sherlock, senior managing director of Buchanan Street Partners during the event’s opening panel.
“I think that cleansing is healthy, but it is going to be a painful cleansing,” said Halford. “But if you can get your mind past that, and if the numbers or values get low enough, people will start sniffing around investing, whereas 90 days ago, they wouldn’t dare even talk about investment.”
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Aug 18, 2009 | No Comments | Sean Mills
HOUSING MARKET
Some saw the housing bubble and sold; trick now is spotting the bottom
Some who sold homes during the bubble are buying again, drawn by deals, despite the possibility of further price drops.Mark Kiesel saw the real estate crash coming.
HOUSING MARKET
Some saw the housing bubble and sold; trick now is spotting the bottom
Some who sold homes during the bubble are buying again, drawn by deals, despite the possibility of further price drops.Mark Kiesel saw the real estate crash coming.
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