DID YOU KNOW?
Top Headlines: Delivered by Leonard Steinberg
March 31st, 2022
01 Is a recession inevitable? Easy Fed money for a decade-plus, too much economic stimulus ($4 trillion in 2020 alone) and record low interest rates also for too long were bound to have untold ramifications in the future. That future is now with the highest inflation in 40 years, interest rates having to move drastically up to combat it, high energy costs, geopolitical concerns with China and Russia, and the Fed put being taken away from the stock market. The pandemic recession was the shortest on record, lasting only three months.
02 Home prices in January grew most quickly in Phoenix, Tampa, and Miami, increasing a respective 32.6%, 30.8%, and 28.1% year over year. The slowest gains were seen in Chicago, Minneapolis, and Washington, D.C., where prices increased 12.5%, 11.8%, and 11.2% year over year, respectively.....not exactly slow growth! (Barrons)
03 The US Federal Government announced new plans to spend $3.16 billion to retrofit hundreds of thousands of homes in low-income areas by making them more energy efficient, part of the $1.2 trillion bipartisan infrastructure bill that was signed into law last year to bolster the federal government’s Weatherization Assistance Program, which is designed to upgrade homes by installing insulation, updating heating and cooling systems and switching to new electrical appliances. The weatherization program began in the 1970s as an effort to slash utility bills and has delivered an average of $372 in annual energy savings. (CNBC)
04 Everyone is bemoaning the rising costs of housing around the globe, but there are still many places where housing is still very affordable, although affordability should always be measured relative to incomes too.... Peoria, IL, Macon GA, Youngstown, OH, Erie, PA all have homes under $150k....(Marketwatch)
05 While many blame COVID for the current supply-chain issues slowing home building, many say the problems started many years before because of the GREAT RECESSION: about 50% of private homebuilders in the USA went out of business in 2008/9 and about a third of the industry’s workforce left the industry. The efforts to correct the lending system and stop banks from providing unqualified borrowers with subprime loans not only impacted homebuyers but also smaller private homebuilders who often relied on community bank loans to fund projects. Banks became more risk-averse when it came to lending into real residential construction development purposes, 60% of the nation’s housing stock is produced by privately owned builders. (INMAN)
06 Second-home sales at the start of 2021 were 90% higher than they were in mid-2020, and 77% higher in December despite a typical holiday slowdown. In 2021, the average price of the top 10% of single-family homes in North America was $1.7 million, up 25% over 2020. The highest 2nd-home sales volume is in Franklin County, Fla., called the state’s forgotten coast due to its quieter towns and minimal development. Second is Sevier County, Tenn., home of the Great Smoky Mountains National Park, and Trigg County, Ky., known as lake country. Second homes are no longer the exclusive domain of billionaires! (PENTA)
