First Analysis of the current market situation
Second update on gold
Third house prices in South Florida
Fourth National Real Estate
Fifth inverted yield curve is still
Sixth What this means to you
First Analysis of the current market situation
As economy and housing market analyst, you must be patient to see what unfolds, and see if the man forecasts are right or wrong. You never know if they are right orwrong, but must have a sense of humility about them, so I'm not blind to market reality.
In March 2006, my e-book How to thrive in the changing real estate marketplace. Protect yourself from the bell now! said that in the short real estate market will be significantly delayed and a constraint on the real economy. We are currently experiencing the economic slowdown and the feeling that I am not far from recessionso well. History has repeatedly shown that a slower housing market and construction market is almost always a result of economic recession in U.S. history.
Let's see what happens in the following areas to see what we can excel in them, Gold, Real Estate in South Florida, National Real Estate, yields / Finance and see what it means for you:
According to Gold
If you've read thisnewsletter and / or e-books, you know I'm a big fan of investing in gold. Why not? Because I think the dollar is in serious financial risk. But gold has risen against all currencies in the world, not just the U.S. dollar.
Why gold has risen? Gold is a form of currency neutral, can not be printed by a government and a long-term insurance against devaluation. James Burton, CEO of Gold Council, said recently: "Gold is still very important reserve assets by central banks as the only reserve asset that is nobody's responsibility. It 's a defense against unknown situations. This is a long-term inflation hedge and also tried one dollar, when it was owned by a good portfolio diversification of reserves of central bank activity. "
I agree with Mr. Burton to 100%. I think we will still see the gold in a bubble again, and this is why I invested in gold to exploit this potential bubble (Do you really think> Summer prices around the year 2002 – not what you want to buy more real estate, then?)
I have already recommended when gold was between $ 580 and $ 600 a we. At this time, gold traded at around $ 670 an ounce of more than 10% of the levels, I would recommend. But gold has a number of serious technical resistance at $ 670 and do not break that level, perhaps the move is short term. If you are still goingthe level of $ 620 – $ 640, I want at this level as a buyer. I think gold goes to $ 800 one ounce by the end of 2007.
Third Estate in South Florida
Real Estate in South Florida has been hit hard by the recession, as was one of the greatest advances in the housing boom. The combination of rising home for sale in the market, incredible amount of construction in the area and interest rates higherthree major factors slowing down.
For every home sold in South Florida in 2006, an average of 14 does not sell many ads for the service (MLS) data. The number of homes available for sale on the market doubled to about 66,000, while sales fell to its lowest level in 10 years.
Although housing prices was the year 2006, the average price for homes fell in December to ask about 13 percent from a year ago. From 2001 to 2005price of a single family home in Miami-Dade 120 percent increase $ 351,200. It 'also similar to what happened in Broward County. The problem is that wages in this period increased by only 17.6% of Miami-Dade and Broward in 15.9%, according to federal data. This is the second important factor contributing to the delay - real estate prices far exceeded the income of buyers of these houses.
Another factor that helped South Florida's booming station The price was high population growth in Florida. From 2002 to 2005, more than a million new residents moving to Florida and Florida were also more work than any other state. But the three major moving companies reported that 2006 was the first time in years that more people moved from the state of Florida in it. Moreover, the decline in school enrollment, which may be another sign that the middle-class families to leave.
By far, however, in South Florida> Real Estate, which is most affected and will continue to market the building. Because of their lower prices than homes that make sense in judging the financial district of south Florida. But the range of available judges tripled during the past year, and will get worse before they get better. More than 11,500 new condominiums are expected this year and 15,000 next year with most of their home in Miami.
As a result of oversupply, said that prices of condominiumsfrom 12% in 2006 to Miami for $ 532,000. Incentives and price reductions to be replaced. These incentives include payment of all tariffs include free upgrades and more.
The last point to consider that South Florida Real Estate is the rising cost of property insurance and property taxes. This cost has increased more downward pressure on prices of Real Estate.
My strong belief that we are just starting to slow down the show South Florida housing market and prices continue to fall. Due to the fact that many investors, Real Estate revoke, where is the next wave of buyers will come out at current prices? Without a serious influx of new high-paying jobs in the South Florida area real estate prices, just as any activity that falls into a big bubble for only one way to go … book.
Fourth Real> Summer National
In a report published last week by the National Association of Realtors showed that in the last three months of 2006 the house sold in 40 states and the house fell on average nearly half the metropolitan areas of investigation. The median price of previously owned single family in 73 of the 149 metropolitan areas identified in the fourth quarter.
National Association of REALTORS report also said that countries with the largest decrease inthe number of sales from October to December over the same period in 2005 were:
* Nevada: -36.1% in sales
* Florida: -30.8% in sales
* Arizona: -26.9% in sales
* California: -21.3% in sales
Nationally, sales increased by 10.1% in the fourth quarter over the same period a year ago. And the national average price dropped to $ 219,300, up 2.7% from the fourth quarter of 2005.
Slower sales and cancellations of existing orders have caused the numberreally unsold homes increase. The availability of housing in 2006, an average of 6.4 months worth of sales was at 4.4 months worth in 2005 and only four months in 2004 is worth it.
Toll Brothers, Inc., the largest U.S. luxury construction at home, reported a 33% fall in orders during the quarter ended Jan. 31.
Perhaps most important of all, home values fall further decrease their use of equity loans calculator withdrawal. 2006, mortgage equity withdrawal charge of 2% GDP growth.The construction added 1% to GDP growth last year, so it is important that these factors on the health of the U.S. economy is enormous.
The second thing is sub-prime mortgages. Today, subprime mortgages account for 25% of all mortgages, about 665 billion dollars. In addition, approximately $ 1000000000000 in adjustable rate mortgages are eligible for recovery in the next two years and will continue to see foreclosures increasing. For example, foreclosures and five times in Denver. Thisforeclosed homes back on the market and suppress the real asset values.
Center for Responsible Lending estimates that as much as 20% of subprime mortgages in the last two years to go negative. This represents approximately 5% of all homes sold back to the market "fire sale". Even if only half days actually get back the market, will provide general assessments to go down and the possibility of obtaining home equity loans in connection with Reducedfurther.
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Fifth The yield curve is inverted!
The yield curve is inverted. In a normal market, you get more interest (yield) for a longer term investment. But very rarely short-term rates are higher than long-term rates now.
History has shown that a reverseyield curve is the best indication of a recession ahead. Yield since the latter is reversed, and if a judge acts should be in a recession for the third quarter of 2007. Throughout history we have never had an inverted yield curve without a recession within the next four quarters.
The inverted yield curve does not cause a recession, it's just a sign that something is out of whack in the economy.
Sixth What this means to you
One ofTwo things can happen in the future in real estate: Real Estate prices will rise or fall. History has shown that an activity that works on began to come, if we are talking about the Dutch Tulip market, the stock market bubble, the bubble of gold in the early 1980s, or Japan in housing in 1980 and the subsequent decline aged 15 in value.
The picture of the housing market is that they deriveup and down in cycles. E 'in an upward cycle of 10 years and is more likely that the time for them to take down cycle.
It 's the natural cycle of activity:
* The markets go up
* Greed and folly to assume
* An excess of form (ie more than a building)
* A slowdown in the market about assault
This natural cycle is the same principle in the "big picture" as crash diets is "miniature". We also hungry £ 15, we closed the body to losein the short term. only to swing more when you go back to "normal" eating patterns
And speaking of diet, I heard from an old high school friend who lose weight on a diet cookie, which is a high protein food per day and only eat six cookies low fat on days when he is hungry. Although he lost weight on 800 calories a day diet, I do not see how it is healthy to starve yourself, then. He said that when he breaks his diet and eat a soft drink, hasgained eighteen pounds immediately. Talk about your body out of whack! I have the best year (www.mattfurey.com), combined with a diet low in carbohydrates white (no white bread, white pasta, sugar and limited). It works for me.
Set up your portfolio now by reading e-books http://www.myrealestatebubble.com.
*** Disclaimer: This information and related sites do not constitute professional services, including but not limited to investment advice.Consult a financial and / or investment in professional services and advice.
