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Posts Tagged ‘unemployment impact on housing’

Morgan Stanley Remains Bearish on Housing

Posted by Larry Doyle on January 13th, 2010 1:20 PM |

The equity markets can and will do whatever they want, but when I look at the economy I remain steadfastly fixed on our housing and labor situation. When these cornerstones of our economic landscape not only stabilize but show marked improvements I will become more constructive on our overall outlook. Are we there yet? No way.

Thanks to a loyal Sense on Cents supporter, I am happy to provide Morgan Stanley’s U.S. Housing Outlook for 2010. What are the key points to this report?

1.  Housing transactions have increased and prices have stabilized due to massive government supports.

2.  The bottoming process continues and the trend for housing remains down given the high percentages of homeowners with negative equity, the high rate of unemployment, the lack of a viable Jumbo mortgage market,  and increasing rates of mortgage delinquencies. (more…)

Increasing Vacancy Rates Will Pressure Both the Rental Market and Home Values

Posted by Larry Doyle on October 6th, 2009 11:42 AM |

You do not need to take Economics 101 to understand that an increase in supply of any asset will almost always lead to a decline in prices. This ‘tremendous grasp of the obvious’ in regard to housing runs right in the face of assertions put forth by many real estate brokers and housing experts.

High five to our friends at 12th Street Capital for bringing attention to The Wall Street Journal‘s writing, Apartment Glut Expands:

(Getty Images) Signs advertise apartments for rent in San Francisco in July. Rents declined during the third quarter, usually a strong period for rentals.

Signs advertise apartments for rent in San Francisco in July. Rents declined during the third quarter, usually a strong period for rentals. (Getty Images)

Apartment vacancies hit their highest point since 1986, surging in cities from Raleigh, N.C., to Tacoma, Wash., as rising unemployment continued to chip away at demand during the traditionally strong summer rental months.

The U.S. vacancy rate reached 7.8%, a 23-year high, according to Reis Inc., a New York real-estate research firm that tracks vacancies and rents in the top 79 U.S. markets. The rate is expected to climb further in the fall and winter, when rental demand is weaker, pushing vacancies to the highest levels since Reis began its count in 1980.
(more…)






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