EconomicsFeature: HAFA – Double Edge Swords AboundThis post first appeared in the April edition of: Cirios Trends: In Search of Real Estate Opportunities. Every six months or so, Washington’s political will seems to coalesce in support of the only issue where there is true agreement across party lines: The housing market is still broken. Sadly, in our view, the Treasury Department’s [...] Around the Bay: Local News BitesThis post first appeared in the April edition of: Cirios Trends: In Search of Real Estate Opportunities. Tower in Pyramid Shadow One Step Closer (San Francisco Business Times) Liberty Hill Development, the developer working on a controversial project to build a 248-unit condo tower adjacent to San Francisco’s Transamerica Pyramid received good news last month, [...] Talking Charts – Local Market AnalysisThis post first appeared in the April edition of: Cirios Trends: In Search of Real Estate Opportunities. As long time readers of this newsletter know, we at Cirios rail against the concept that “it’s a great time to buy,” irrespective of market condition. There is just too much that goes into the homebuying decision to [...] The State of the Markets – March 3, 2010This post first appeared in the March edition of: Cirios Trends: In Search of Real Estate Opportunities. Last month, we discussed the role confidence plays in the housing market. The better Americans feel about the economy (using the stock market as a barometer of the country’s economic fortunes), the more likely they are to go [...] The State of the Markets — February 2, 2010This post first appeared in the February edition of: Cirios Trends: In Search of Real Estate Opportunities. If someone were to wake up from a 5-year coma and ask about the state of our country’s economy, the chart below pretty much sums it up. The past five years in the housing market, the financial market [...] Feature: Real Estate Investing with Your IRAThis post first appeared in the February edition of: Cirios Trends: In Search of Real Estate Opportunities. At cocktail parties and around the water cooler, the familiar refrain that “now is a great time to buy,” is piquing the interest of even the most casual real estate investor. For many, however, taking advantage of “distressed” [...] Cirios Opportunities: Sweet Salvation in South CityThis post first appeared in the February edition of: Cirios Trends: In Search of Real Estate Opportunities. Opportunity Overview: Of the many profitable real estate investment opportunities available in the Bay Area, one which has recently received attention in the media is buying foreclosed homes directly at the public auctions held on the courthouse steps. [...] SPECIAL EDITION: Cirios Trends — A Decade in FluxIn this SPECIAL EDITION, check out: The State of the Markets: A Decade in Flux 10 years that were anything but boring.. Home Prices: A Much Needed Breather After a historic rise, an equally historic fall. Getting Back on Track: Are We There Yet? Many believe the bottom in housing has come and gone. Are [...] The State of the Markets: A Decade in FluxThis post first appeared in the SPECIAL EDITION: Cirios Trends: A Decade in Flux The books are officially closed on a decade which will be remembered for an historic real estate boom in the United States that busted in spectacular fashion, nearly taking the entire world financial system down with it. Of course, the real [...] Home Prices: A Much Needed BreatherThis post first appeared in the SPECIAL EDITION: Cirios Trends: A Decade in Flux << PREVIOUS Life is always so much clearer in hindsight. The graph below shows the US Median Home Price (blue line, as measured by the 6-month moving average of the Median Price, admittedly as arbitrary a metric as any other) graphed [...] Getting Back on Track: Are We There Yet?This post first appeared in the SPECIAL EDITION: Cirios Trends: A Decade in Flux << PREVIOUS We wrote back in June of 2008: “The Holy Grail de jour of financial market prognostication is predicting the bottom in housing. It’s a fool’s errand, however.” Identifying the low point in any asset class is an effort best [...] Recovery: How Long Did it Take Last Time?This post first appeared in the SPECIAL EDITION: Cirios Trends: A Decade in Flux << PREVIOUS The aforementioned warning about historical analogues notwithstanding, let’s take a look at how the housing market recovered the last time there was a persistent decline in home prices. As an aside, one of the most challenging aspects of analyzing [...] Inflation: What is it Good For?This post first appeared in the SPECIAL EDITION: Cirios Trends: A Decade in Flux << PREVIOUS At the heart of some of the most contentious debates in the otherwise drab world of macroeconomic theory is that of inflation (yes, there are in fact contentious debates about macroeconomic theory). To wit, economics can’t even agree on [...] Inflation and Home Prices: Is the Romance Over?This post first appeared in the SPECIAL EDITION: Cirios Trends: A Decade in Flux << PREVIOUS A cursory look at the long term trends for inflation and home prices reveal strikingly similar patterns. Until, that is, right around 2003 (see dotted line below). (click to enlarge image) In the wake of the short recession caused [...] Home Prices vs. Mortgage Rates: Let’s DanceThis post first appeared in the SPECIAL EDITION: Cirios Trends: A Decade in Flux << PREVIOUS It stands to reason that falling interest rates leads to higher home prices. After all, for every one percent drop in mortgage rates, buyers can afford around 10% more house. Against that backdrop, the chart below makes sense: After [...] Do High Mortgage Rates Kill Home Prices?This post first appeared in the SPECIAL EDITION: Cirios Trends: A Decade in Flux << PREVIOUS Given the widespread expectation for future inflation, and as an extension higher interest rates to combat rising prices, the question above is the most common one we hear from home buyers and real estate investors alike. To try and [...] All Bubbles Burst, EventuallyThis post first appeared in the SPECIAL EDITION: Cirios Trends: A Decade in Flux << PREVIOUS The belief that the Federal Reserve kept interest rates too low, for too long, is one which is now nearly universally held. Well, outside the Fed, that is. Here’s a smattering of quotes which show how the view of [...] A Tale of Two Markets: Underneath the DataThis post first appeared in the SPECIAL EDITION: Cirios Trends: A Decade in Flux << PREVIOUS Since we just spent the last ten pages laboriously scratching the surface of complex macroeconomic trends with a few over-simplified charts, we will now analyze every single US housing market by looking at sales data in two cities. As [...] Historical Macro DataUS Median Home Price 1965-2009 Gray area is “Inflation” period of 1972-1983, 201% total increase in home prices during that 12 year period, or 10.5% annually. (click image to enlarge) Consumer Price Index 1965-2009 Gray area is “Inflation” period of 1972-1983, 147% total increase in CPI during that 12 year period, or 8.5% annually. (click [...] Are Housing Fundamentals Still Deteriorating?This post first appeared on Minyanville. There’s a good amount of buzz surrounding the Wall Street Journal’s piece on the staggering number of homeowners underwater on their mortgages. This, on the same day the Case-Shiller Home Price Index posted its fourth consecutive month-over-month increase. Mixed signals? Possibly. But in reality, these two seemingly disparate data [...] The State of the Markets – 11/3/2009This post first appeared in the November edition of Cirios Trends: Getting to the Bottom of the Housing Market Of the myriad debates ongoing at a time when economics and politics are seemingly two heads of the same freakish snake, the role government should play in directing economic actions dominates an already ideologically charged arena. [...] CIT Puts “Too Big to Fail” to the TestThis post first appeared on Minyanville. We have truly become a bailout nation. As regulators mull over the possibility of rescuing CIT Group (CIT) — a small-business lender that counts over 1 million US firms as customers — analysts debate whether the relatively small firm is deserving of a taxpayer-funded bailout. Or for that matter, [...] Deflation Still Clear and Present DangerBy ANDREW JEFFERY This post first appeared on Minyanville. Deflation, the economic beast many feared would devour the next decade, appears to have been vanquished. Or has it? Superficial signs of renewed inflation are everywhere: Oil prices appear to be stabilizing, and concern is growing about future supply shortages (which, by extension, could lead to [...] Government Reduces Risk – But Also RewardBy ANDREW JEFFERY This post first appeared on Minyanville. In its ongoing attempt to rewrite the rules of what’s quickly becoming our quasi-capitalist nation, the Obama Administration is weighing options that would expand compensation restrictions to all corners of the financial-services industry. According to the New York Times, well-publicized efforts to rein in executive pay [...] |