Implode-Explode Heavy Industries news feed

Existing-home sales rise 2.6% in June

Tue, 22 Jul 2014 14:40:12 GMT

``Rising for a third month, sales of existing homes grew 2.6% in June to a seasonally adjusted annual rate of 5.04 million, reaching the highest level since October, the National Association of Realtors reported Tuesday''

The inflection point has arrived in Southern California real estate

Mon, 21 Jul 2014 13:13:09 GMT

``Big money is slowly starting to pull away from the real estate market. We are seeing this in dramatic fashion in Arizona and Nevada... We are seeing ... action happening in places like the Inland Empire and Central Valley where inventory is certainly up and prices are hitting plateaus. The momentum from 2013 is now running on fumes. We also have certain cities being dominated by investors and in many cases money is coming directly from China. Hot money is finding a home in the oddest of places. Yet one thing is certain and that is SoCal real estate is now entering into an inflection point. As this turn unfolds we are going to find out what areas are truly prime and what other areas are all hat with no cattle.''

Crisis in Atlantic City: Trump Casino pulling out

Sat, 12 Jul 2014 20:02:30 GMT

``It appears Atlantic City as a second Las Vegas is becoming history. This New Jersey USA gambling town becomes more and more a ghost town for visitors and tourists. If Trump Plaza closes, Atlantic City could lose a third of its casinos and a quarter of its casino workforce in less than nine months. The Atlantic Club closed in January, the Showboat is closing next month and Revel might do likewise if a buyer can't be found in bankruptcy court''

Realtors and FAA in Battle Over... Drones

Fri, 11 Jul 2014 20:27:19 GMT

``The NRT letter is so sweeping that a homeowner who filmed their own house with a drone for fun, might be told by their realtor that they could not use their photos or videos in their own home listing. It's not clear why NRT would want to issue such a sweeping restriction on the use of images.''

China buys $22bn worth of US homes, leads global pack, As Foreigners Take 7% of US Market

Wed, 09 Jul 2014 19:10:29 GMT

``Chinese buyers spent $22 billion on US homes in the 12-month period ending in March, or about 24 percent of total foreign sales by dollar value, according to a study released Tuesday by the National Association of Realtors (NAR). That's up from $12.8 billion, or 19 percent, on the previous year. Total international purchases of American homes jumped to $92.2 billion, according to the NAR, an increase of $68.2 billion on the year before and $82.5 billion for the year ending in March 2012. Foreign clients made up about 7 percent of transactions in the $1.2 trillion US real estate market.''

Welcome to the Everything Boom, or Maybe the Everything Bubble

Wed, 09 Jul 2014 14:17:25 GMT

Welcome to the Everything Boom -- and, quite possibly, the Everything Bubble. Around the world, nearly every asset class is expensive by historical standards. Stocks and bonds; emerging markets and advanced economies; urban office towers and Iowa farmland; you name it, and it is trading at prices that are high by historical standards relative to fundamentals. The inverse of that is relatively low returns for investors.
...
Prefer a more solid asset? The price of office and apartment building has risen similarly; office space in central business districts nationwide costs $300 per square foot on average, up from $147 in early 2010, according to Real Capital Analytics. In Manhattan, an investor in an office building can expect rent payments after expenses to add up to only a 4.4 percent return, known as the capitalization rate, lower than even in 2007, the top of the last boom.

Downsizing: Why the Market for Heirloom and Secondhand Furniture Has Disappeared

Sun, 06 Jul 2014 15:22:51 GMT

``Whether moving to a smaller abode or simply cleaning out, many people are making an unwelcome discovery: Their prized family heirlooms have turned into junk. Upholstered sofas, formal dining tables and hutches, Victorian-style mahogany and oak furniture, entertainment units, bulky television sets, pianos--all have become almost impossible to sell or, in some cases, give away... When locating from full-size suburban houses to townhomes, many people realize too late that their old furniture will be an awkward fit, says Mr. Brooks, the interior designer. Design elements in new construction, including kitchen islands, built-in shelves and the lack of formal dining rooms help make older furniture feel dated. The sizes are all wrong, he says. "Everything had been scaled for bigger spaces."''

Pending Home Sales Soar 6.1%; But Still Down Y-O-Y

Mon, 30 Jun 2014 16:30:38 GMT

``Compared to May 2013, pending home sales are still down 5.2%.''

UBS: The Secret Reason The Fed Is ‘Tolerating' Bubbles

Mon, 30 Jun 2014 14:11:50 GMT

``One option would be to stop printing money and raise interest rates, the classic maneuver, "which would typically have been seen as the first, and possibly only, line of defense," UBS explains wistfully. But it would wreak all sorts of havoc on the financial markets and deflate the wealth of those who've benefited from the money-printing binge. UBS explains it this way: "with economic activity levels still seen as too fragile in most major countries, central banks have been searching for substitutes."''

China Builds Its Own Manhattan -- Except It's a Ghost Town

Sat, 28 Jun 2014 14:30:09 GMT

``The skyscraper-filled skyline of the Conch Bay district in the northern port city of Tianjin has none of a metropolis's bustle up close, with dirt-covered glass doors and construction on some edifices halted. The area's failure to attract tenants since the first building was finished in 2010 bodes ill across the Hai River for the separate Yujiapu development, which is modeled on New York's Manhattan and remains in progress.''

In One Picture: Here Are the 43,634 Properties in Detroit That Were on the Brink of Foreclosure This Year

Fri, 27 Jun 2014 19:56:44 GMT

``This mosaic, created with images from Google Maps Street View, shows one of the many enormous challenges facing Detroit as it tries to climb out of debt. As of January, the owners of these properties collectively owed the county more than $328 million in unpaid taxes and fees. Since then, some have paid their debts, entered in payment plans or qualified for assistance. But 26,038 properties, shown with a , remain in jeopardy, and many are headed for public auction.''

Are we running out of rental housing?

Thu, 26 Jun 2014 18:51:37 GMT

``We have certainly bounced off the bottom but we are a far cry from the over 2 million starts back 10 years ago. Much of the excess housing units are being sold off in this low inventory market. The question of course is what happens when you price families out?... Household formation continues to be near a generational low. Until we start seeing this increase, there is little reason to believe that home sales will take off again.''

Two charts that show why the housing market is off track

Mon, 23 Jun 2014 23:49:52 GMT

``Sales were 5 percent below where they were last year, when the housing recovery took off, in part spurred by investors who were buying foreclosures and other distressed properties at firesale prices. Based on the size of the population, a normal sales rate would be closer to 5.5 million. ''

Home sales edge up, signs of stress remain

Mon, 23 Jun 2014 21:18:14 GMT

``"The share of cash-only purchases held firm at 32 percent, despite a drop in investors' share of purchases, signaling that refinancing remains a major hurdle for many families," observed Stephanie Karol, a U.S. economist for forecaster IHS Global Insight. "The share of first-time buyers was the primary cause for concern in this report: it fell 2 percentage points in May to 27 percent. The existing home sales market can only retain its strength for so long if move-up buyers cannot find a first-time buyer to purchase their starter homes."''

The Biggest Story of 2014 -- The Return of the Inflation Trade | Chris Puplava

Mon, 23 Jun 2014 16:01:21 GMT

``An update of the chart above shows that we aren't likely to see a peak in rental inflation until the fall of 2015, which suggests higher inflation will continue and the recent rise is unlikely just "noise". ''

Why Big Real Estate Could Benefit From S.F.‘s Anti-Development Vote

Sun, 22 Jun 2014 16:53:37 GMT

``On Tuesday, city voters -- in a low-turnout election -- approved Proposition B, which would put to a citywide vote every project that exceeds the normal height limits along San Francisco's eastern and northeastern waterfront edge. Any development in the city already faces a grueling public review, but now it also has to face an up-or-down citywide referendum.''

Canary In A Handbag: Why Coach Hit The Skids - David Stockman

Sat, 21 Jun 2014 13:38:57 GMT

``Why is it so easy to build a 550 store retail emporium on operating leases? The answer is financial repression. Mall owners have enjoyed "cap rates" on their debt capital (most of their investment) which has been far below market clearing levels every since the Fed launched into monetary central planning and interest rate pegging.''

Faber: Fed Tactics Have Been 'a Catastrophe' for Economy

Thu, 19 Jun 2014 19:11:36 GMT

``he Fed is boosting asset prices. It leads to less affordability, people can't buy their homes anymore in the lower income group...''

Are Housing Prices About To Take A Tumble?

Thu, 19 Jun 2014 14:43:16 GMT

``We've been told by the National Association of Realtors for at least the last six months that low inventories have been the source of the disappointing home sales. As I have argued in several past articles, however, the deteriorating financial condition of the average household is the real reason for the declining trend in home sales. Moreover, the inventory of both new and existing homes has been rising since the beginning of the year but higher inventories are not stimulating sales. Rising inventories and declining demand will inevitably force prices lower over the course of the summer.''

"Housing Recovery" Rounding The Top As Starts Disappoint?

Wed, 18 Jun 2014 14:53:22 GMT

``It was, in a word, disappointing. It was so disappointing in fact, that both housing starts and permits not only missed expectations, but tumbled from the previous month by the most since January and the great "Polar Vortex" which was the kitchen sink used to explain the collapse in US GDP in Q1. Perhaps it was the early arrival of El Nino?''