Via the Record: ULI Conference Sez Real Estate Outlook Horrible. Nov 2011

[stephendare]

From the Department of "Signs of the Apocalypse"



This extremely insightful article provides a pretty sharp look at the pessimism that has seized real estate markets locally.

Karen Brune Mathis goes on to elaborate, the entire article is worth a read.

Interesting long term quote from Rummel right after the jump.  Kinda Scary in its bland implications, actually.

http://jaxdailyrecord.com/showstory.php?Story_id=534871

Jacksonville was just .02 points from escaping the red-shaded real estate investment ranks of “generally poor” to reach the yellow-tinged tones of “fair.”

“At 4.5, it would be a yellow,” said Dean Schwanke, executive director for the Urban Land Institute Center for Capital Markets and Real Estate and ULI senior vice president in Washington, D.C.

Jacksonville scored 4.48 on a scale of 1-9, low to high, for its attractiveness for real estate investors.

Among the 51 markets scored, Jacksonville ranked No. 40. Washington, D.C., was No. 1 and Detroit, Mich., was No. 51.

Among market areas with under 2 million in population, Jacksonville ranked No. 11. Austin, Texas, was No. 1 in the category for population and No. 2 overall. Las Vegas was last, at No. 18, in the category and No. 49 overall.

Still, Schwanke said Jacksonville’s investment prospects are showing some signs of improvement.

Schwanke was the guest speaker to almost 180 members and visitors at the ULI North Florida “Emerging Trends in Real Estate 2012” program Wednesday evening at the Hyatt Downtown.

The investment rankings were reported in the “Emerging Trends in Real Estate” report from ULI and PwC, the brand name of member firms of Pricewaterhouse Coopers.

The 2011 report was called “The Era of Less.” The 2012 edition is “Facing a Long Grind.”

[Springfield Chicken]

I guess I'm a glass-half-full-kind-of-gal.  I see prices that more affordable than in years, interest rates that I never thought I'd see, ever.  So from a buying perspective, the opportunities are awesome.  If you are a seller, they suck.  But the difference in sucking a little and sucking a lot isn't that much difference in the end.  If you are upside down you're upside down.  And that is all over the country.  We're finding that many people who did a short sale a year ago are now able to get a mortgage again and can now buy more home for a lot less money.  I'm not saying times are great, but it's the old lemon/lemonade thing.  (One too many cliches?)

[dougskiles]

And while the experts are telling us the outlook is horrible (in large part because we are overbuilt), the state legislature is trying to find ways to encourage more growth.

I must have taken a different economics class than they did.

I also wonder why the current property owners aren't screaming about these pending subsidies.  By making it easier to build new stuff, the values of the existing stuff will continue to drop.  The same groups that complain about the government printing money (and devaluing currency) seem to be the ones pushing for continued subsidized growth (and devaluing existing property).

[simms3]

Jacksonville's two saving graces are its extreme level of distressed properties being cleared off the books right now (i.e. opportunities for smaller buyers and opportunistic funds) and its ease of doing business relative to some other cities.  There is no demand for new construction, but Jacksonville did lead the country in Q3 sales of distressed multifamily properties.

Jacksonville is an opportunity for institutional/REITs to get out of this market because it is not a core market and for smaller guys to come in.  It's a recycling opportunity.

[Captain Zissou]

The 8 Healthiest Housing Markets
Daily Real Estate News | Monday, November 07, 2011

Many of the housing markets projected to have the biggest gains into 2012 tend to be the home to major universities, strong private sector employment, or have nearby military bases, according to a list of the healthiest housing markets by Builder Magazine. Builder teamed with Hanley Wood Market Intelligence to compile its annual list of the healthiest housing markets in the country, factoring in housing projections from Moody’s Economy.com. The list was based on projected price appreciation, population growth, income growth, and improving employment picture.

The following are the eight cities that topped Builder’s list, including projected housing permits in 2011 and 2012.

4. Jacksonville, Fla.

2011 Building Permit Forecast: 2,284

2012 Building Permit Forecast: 4,363

Jacksonville has a strengthening employment picture, with a military presence and a growing financial services sector. Employment is expected to increase 3.2 percent in 2012. With stabilizing home prices already, prices are expected to rise 5 percent next year and housing permits are expected to double.

http://realtormag.realtor.org/daily-news/2011/11/07/8-healthiest-housing-markets