The existing real estate market is taking off. I’ve been tracking AZ, TX, and FL real estate for investment properties and in my opinion the bottom was a few months ago. Bargain shopping is in full swing and in a few months nothing at the bottom that is worth buying will be left, then we’ll really see other real estate start to pick up as people panick. The $8,000 first time home buyer credit, along with low prices and low interest rates is working.
The bottom at 6600 in the dow has passed. Bargain shopping is in full swing. I hope you guys didn’t miss this.
I don’t think anyone at this point can deny that while unemployment did rise, that some leading market segments are in recovery mode.
Some bank stocks have tripled, and we will know just how profitable some have become depending on this quarter’s report.
Plenty of homes near me are occupied but will be empty in the next couple of months as people continue to walk away from mortgages that can’t afford. Incentives are helping some sales as you note but the home sales recovery is going to be slow.
There was no need for the stimulus bill in the first place. I heard more than one economist claim that the recovery would take place as soon as Summer 09’ and most stated no later that Q1 10’.
Since the “Stimulus” didn’t even start until end of march with the bulk going out 10’ and 11’ Seems to me they were correct.
~Matt
Edit to add: Not to mention that there was very little Stimulus in the “Stimulus” package.
I do not share your optimism. While I agree that there are some data points that are positive, I think there is still much more correction left in the market (we haven’t really seen the full impact of commercial real estate). Plus, the concerted efforts of governments around the world is not only delaying the correction process but is making the situation worse through deficit spending and inflation.
The company I work for serves various end markets (auto, construction, electronics) and we have yet to see any sign of stengthening end market demand. This is true for many of our peers as well.
I hope you are correct, but believe that it will get much worse before it gets better.
I’m with you on this dew. I’m in the commercial real estate business and can tell you that we are just STARTING to feel the hurt here. Many millions of dollars will be lost in the upcoming months, with defaults heading to new levels. It will take at least 12-18 months for just this sector to get cleaned up. I can’t speak for other parts of the economy, but I think we’re just entering the second wave. What’s next? Credit cards, student loans…
We haven’t fixed the banks, just put them on life support (remember we were going to buy the toxic assets)
But its good for first time buyers…get a credit and if they are savvy will buy a home a good price. Rates are at historic lows if you have any equity so you can refinance.
In my opinion, as an investor, some RE markets have hit the bottom and are picking up speed.
Commercial RE is at the tail end of the recovery and will be the last to recover.
At 8.5%, unemployment is high. We have to watch the unemployment reports, but even increasing a few more basis points doesn’t mean the correction hasn’t started.
The stock market was completely overvalued. Assets were artficially inflated. What’s a good number for the DOW or S&P? And why? Its just going to get inflated quite so quickly.
This quaterly report is going to shock a lot of people. Many banks are now profitable. Look at the futures market.
I disagree. The RE is far from over, unemployment will continue to go up and the stock market will still go lower. But we are experiencing a great Bear Market Rally and it’s great to make some money. But to buy and hold is a big mistake IMO.
I wouldn’t call it bargain shopping. People think they got bargain prices but when everything is said and done, the average person will lose more by trying to trade in and out as they are emotional and sell at the bottom only to buy back at “bargain prices” when the trend is confirmed.
What are those leading market segments that are in recovery mode? Maybe the sales numbers that are still way down but beat “analysts” expectations? The RE sales volume when there is still a wave of future foreclosures and pent-up foreclosed inventory? Or are you talking about he banking segment that now indicated to the masses that bottom was in. Had it not been for a change to accounting rules none of those banks would have those massive profits they are bragging about.
We’ll go higher but by end of next week, I think, that the financials will pull back big time. Just wait for 2Q and 3Q numbers to come…and the xmas sales…also don’t forget that upper income RE is taking a dive right now and will continue to do so over the next couple years. More businesses will close and, unemployment will continue to grow and what happens to the wave of unemployed people that will begin to experience the “end” of their unemployment benefits.
Let’s just wait and see the economic reports. Like I said, I think the bottom was March 6 and bargain shopping has started. The P/E ratios (depending on what period is used for the P) are excellent. There is a LOT on the sidelines that is waiting for the right moment. The moment for RE has started, same for stocks. Commercial RE is going to be hurting for a while, but companies have let go of enough staff to be profitable. Capacity is low, so when the recovery picks up real speed the unemployment level will drop substantially.
“The P/E ratios (depending on what period is used for the P) are excellent.”
Well, try looking at future P and let us know if it still is excellent. It would be really interesting to see the sales of ______ (e.g. bikes, anything else for that matter).
People lost jobs - retirement - home values , this all near their retired / older years .
You think a sight " correction " will make them want to play again ?
Consumer confidence is still in the "shit can " that’s the key to all this .
All I see is a few folks buying homes in their kids name, to get the first time buyer
8K .
Anyone who was at or near retirement age and had their money in equity investments is an idiotic. Ead my lips - IDIOT. At that point in your life there is no way anyone should have risk in the investment porfolio.
Anyone who bought a home within the last 4 years bought at an inflated price. A lot of fools invested in real estate thinking they were going to make a killing. Well guess what, inventory built up and demand plummeted.
Yes, people have lost their jobs, but eployment is cyclical. Employment in America is one of the highest in the world, and people are bitching about that?
Look at where the stock market is today and tell me there isn’t improvement.
