Below is a link to view the July 2017 client presentation and its notes in entirety. Please contact us if you have any questions regarding the material. We hope to see you next time.
Berkeley, Inc. Semi-Annual Presentation, July 2017
Kelly Simon, a local Treasure Valley real estate agent, has posted the most recent information on housing in the Boise area. We intend to publish this quarterly.With a little luck I'll be able to find someone in the Inland Empire to do the same. Here are a few of her comments on the market:
Inventory in Ada County is at an all-time low. January was the lowest inventory that this valley has seen in 17 years and it is down 20% from last year. There are only 555 re-sale homes for sale versus the 994 homes available at this time last year. The builders in the valley are building as fast as they can to build up their inventory, but with that being said there is only a 2 month supply of new construction versus a 6 month supply of new homes this time last year. This is at least a 9 year low for New Construction inventory in Ada County.
If you have an interest in the size and growth of federal, state and local governments the article posted to our blog will likely fascinate you. All of the specific, verifiable numbers are illustrated and explained.
Given the recent presidential campaign and the president's current rhetoric I found the recent article from the Brookings Institute extremely interesting. It outlines the stats on the size and scope of Federal, State and local government. The most surprising data point is that the number of federal employees has remained relatively steady even though the country's population has steadily increased. State and local government have made up the difference. I suspect it's an effort to push local control. So, state and local governments are given grants and general funding to provide services in their states and municipalities.
10 questions and answers about America's "Big Government"
On January 21 & January 28 Berkeley, Inc. hosted their semi-annual client presentations in Idaho & California. You can view or download the presentation using the link below. The topics of discussion were market conditions & outlook, general economic conditions, & tax law changes. Please let us know if you have questions on the material or would like to discuss something you see.
The Wall Street Journal published a report on the state of the U.S. home sales market. Wow…we’ve reached a peak not seen since February 2007. Existing housing supply, which is now at 4.3 months, is much shorter than the 6-month supply that’s often considered the sweet spot. When the supply duration drops below 6 months, housing prices usually increase since there are more buyers than sellers. For those readers that have experienced tight housing supplies, it’s a bit unusual and surreal. Consider listing your house for $350k and by day-end you’ve recevied 3-5 offers, all well above your asking price. Markets in California and New York City occasionally operate like this, but it’s unusual in the country’s heartland.
US Existing-Home Sales Highest Since February 2007
As can be seen in the article, the housing market continues to be robust, this, combined with low unemployment, reflects a strong economy. It also often reflects an economy that may be reaching a point for a slowdown. Housing is usually a lagging indicator. In other words, by the time that home buyers have enough money to bid up prices, inflation increases and the Federal Reserve will rain on the economic parade by increasing interest rates. This in turn increases the cost of buying a home so fewer buyers can afford a new home and prices decline, once again. Understanding economics can often seem elusive.
While it impossible to predict the economy, for many Americans life has never been better. The devil will be in the details of the Trump administration. He has espoused tariffs and restricted trade while lowering taxes and increasing spending on the military and infrastructure. These goals provide a wonderful basis for increasing budget deficits and, in the short-term, less growth for companies that export their products and services.
Let’s forget politics and economics for a week. Eat too much and enjoy the company of those around you. Happy Thanksgiving.
The Berkeley, Inc. Team
Occasionally we like to post articles that give you some insight into how we form our opinions or stay informed.