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untanglingwebs
El Supremo
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The Eight States Running Out Of Homebuyers
Posted: January 17, 2011 at 8:37 pm
Print Email Subscribe Follow us on Twitter The single biggest problem in the U.S. real estate market is simple: There are very few homebuyers.
That seems obvious, but the “buyers’ strike” has caused house prices to drop, along with an epidemic of foreclosures. What’s worse, the long depression in real estate is probably not over. S&P has forecast that home prices will drop by 7% to 10% this year. The S&P Case-Shiller Index has dropped for most of the 20 largest real estate markets over the last several months. RealtyTrac recently reported that more than one million homes were foreclosed upon in 2010.
Many economists argue that the housing market may take four or five years to recover. Even if that’s proven to be true, the all-time highs of 2006 may never be reached again.
The devastation in some regions will never be repaired. Parts of Oregon, Georgia, and Arizona have become progressively more deserted. Since jobless rates may never recover, there is little reason to hope that the populations in these areas will ever rebound. Some homes will be torn down in these pockets of high foreclosures in the hopes that reducing supplies will boost prices. Whether that idea will work in hard-hit areas such as Flint, Mich. and Yuma, Ariz. remains to be seen.
24/7 Wall St. looked at a number of the standard measures to find the housing markets facing the biggest problems attracting buyers. After a detailed examination, six metrics were chosen: (1) vacancy rates for 2010; (2) foreclosure rates for 2010; (3) November 2010 unemployment rates; (4) change in building permits from 2006 to 2010; (5) change in population from 2005 to 2010; and (6) price reduction by major cities for 2010. Taken together they create a strong statistical base to describe markets which buyers have largely abandoned.
Several states nearly made it onto the list such as Colorado and South Carolina, but did not get poor enough marks across all of our measurements. Each was among the ten worst for declines in building permits. Colorado had one of the worst foreclosure rates, and South Carolina one of the worst vacancy rates. However, the populations in both states have rebounded enough to make a strong case that their housing markets may recover moderately over time.
The review of the data raises several public policy issues. The most important of these is whether the federal focus on reviving the housing market should be concentrated in the hardest hit regions. The counter to that point of view is that some cities such as Flint or states like Nevada are in such bad shape that they are beyond assistance. Unemployment rates are too high in these areas and perhaps the number of homes on the market is too large.
One thing is certain. The housing recovery will be wildly uneven. A city like New York which has a dense population and large numbers of middle class and upper class buyers who will wait until they believe prices hit bottom will have a rapid recovery soon. Building permits granted in New York City over the last four years have been very low. The supply of apartments is also low. Those forces taken together with an even modest economic recovery will help push real estate prices higher in New York and regions with similar characteristics.
The real estate crisis has gone on for four years. In the states 24/7 Wall St. has chosen here, the crisis will go on much longer.
Click here for our list of 8 states that are running out of home buyers. |
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Wed Jan 19, 2011 8:51 am |
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untanglingwebs
El Supremo
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The Eight States Running Out Of Homebuyers
Posted: January 17, 2011 at 8:37 pm
1. Michigan
>Vacancy Rate: 15.98% (9th Worst)
>Unemployment: 12.4% (Tied for 2nd Worst)
>Population Change (2005-2010): -2.05% (Worst)
Michigan is one of only two states whose population has decreased in the last five years. The state has lost more than 12,000 people, or 2% of its population, since 2005. Most of this population loss was undoubtedly due to the depression in the car industry that lead to the bankruptcies of GM and Chrysler. Flint, once one of the largest car manufacturing cities in America, has lost more than 10% of its population in the past 10 years. The state has the second worst unemployment rate in the country at 12.4%. Michigan has a home vacancy rate of 15.98%, the ninth-worst in the the US. There are large neighborhoods in Detroit which are vacant.
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2. Nevada
> 2010 Foreclosures: 9.42% (Worst)
> Unemployment: 14.3% (Worst)
> Decrease in Building Permits 2006 to 2010: -84.39 (Worst)
In 2010, an incredible 9.42% of all housing units in Nevada were foreclosed upon. This is by far the highest foreclosure rate in the U.S., and is nearly twice that of the next-worst state. Nevada also has the highest unemployment rate in the United States, at 14.3%.The recession undermined profits in the gaming industry. Between 2006 and 2010, the state had an 84.3% decrease in building permit requests, the largest drop in the country. This has resulted in the loss of tens of thousands of construction jobs.
[24/7 Wall St.'s Free eLetter - analyst upgrades, downgrades, day trader alerts, dividend trends, IPOs, M&A, and Buffet watch.]
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3. Arizona
> Vacancy Rate: 17.3% (5th Worst)
> 2010 Foreclosures: 5.73% (2nd Worst)
> Decrease in Building Permits 2006 to 2010: -81.36% (4th Worst)
Arizona is among a handful of states most deeply wounded by the real estate collapse. Some 5.73% of properties in the state have been foreclosed upon, the second highest rate in the country, and 17.3% of homes are vacant, the fifth greatest rate in the country. Also, Mesa, Phoenix, and Tucson, the state’s three largest cities, are all among the top five American cities with the greatest percentage of price reductions for homes in 2010, along with Minneapolis and Baltimore. As of December 2010, these cities had 43%, 42%, and 38% of their listings with price reductions, respectively.
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4. California
> 2010 Foreclosures: 4.08% (4th Worst)
> Unemployment: 12.4% (Tied for 2nd Worst)
> Decrease in Building Permits 2006 to 2010: -74.7% (6th Worst)
California’s impact on the housing market is huge. The state is the largest among the 50 in total GDP and housing units. California’s unemployment rate of 12.4% is now tied for second place with Michigan, once the jobless capital of the nation. In 2010, the state had one of the highest rate of foreclosure rates in the country, at just over 4%. New construction has dropped off dramatically as well, with a 74 % decrease in new building permits between 2006 and 2010.
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5. Illinois
> 2010 Foreclosures: 2.87% (9th Worst)
> Decrease in Building Permits 2006 to 2010: -81.32% (5th Worst)
> Population Change: 1.23% (8th Worst)
Although Illinois has a relatively low residential vacancy rate, finding people to buy homes can be difficult. The state’s population only grew 1.23% between 2005 and 2010. This is the eighth worst growth rate in the country. Furthermore, the number of building permits issued since 2006 decreased 81.32%, the fifth greatest drop in the nation. The collapse of the state’s industrial base has been so great that its economy will not recover anytime soon.
6. Georgia
> 2010 Foreclosures: 3.25% (6th Worst)
> Unemployment: 10% (9th Worst)
> Decrease in Building Permits 2006 to 2010: -82.29% (2nd Worst)
The number of building permits issued in 2006 in Georgia was 92,541. In 2010 that number dropped to 16,391. This is the second greatest decrease in the nation during that time. The state’s unemployment rate, at 10%, is above the national average of 9.4%. Also, in 2010, there were 130,966 foreclosures in Georgia, 3.25% of the state’s properties. This is an increase of 53.62% since 2008.
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7. Oregon
> Unemployment: 10.6% (Tied for 5th Worst)
> Decrease in Building Permits 2006 to 2010: -74.08% (7th Worst)
> # of Listings With Price Reductions (Portland): 35% (Tied for 8th Worst Among 50 Largest US Cities)
Oregon’s real estate market has suffered the double blow of a sharp drop in both building permits and price reductions on existing homes. Unemployment is 10.6%, the fifth worst rate in the country. The number of new building permits decreased by 74% from 2006 to 2010. In December 2010, 35% of listings in Portland, the state’s largest city, had price reductions.
Also Read: Another Year of Profits for Airlines
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8. Florida
> Vacancy Rate: 21.03% (2nd Worst)
> 2010 Foreclosures: 5.51% (3rd Worst)
> Decrease in Building Permits 2006 to 2010: -81.37% (3rd Worst)
Unemployment in Florida is 12%, the fourth worst in the country. Approximately 1.1 million residents are out of work. Statistics show that 21.03% of the state’s housing units are vacant. Furthermore, 5.51% of homes have been foreclosed upon. Florida was among five states that had the largest real estate booms from 2000 to 2006. Residential prices in some waterfront areas like Miami and Palm Beach rose by much more than double during that period. New home and condominium construction soared. Many of those residences have never been occupied and are still part of the inventory of homes for sale.
Sources:
1) Vacancy rates for 2010 – American Community Survey (Census Bureau)
2) Foreclosure rates for 2010 – RealtyTrac
3) November 2010 unemployment rates – Bureau of Labor Statistics
4) Change in building permits from 2006 to 2010 – Census Bureau
5) Change in population from 2005 to 2010 – Census Bureau
6) Price reduction by cities for 2010 – Trulia
Douglas A. McIntyre, Michael B. Sauter, and Charles B. Stockdale |
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Wed Jan 19, 2011 8:53 am |
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untanglingwebs
El Supremo
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This data is important as Flint is continuing on their quest of using federal money to create new low-to-moderate income homeowners. There is no certainty these houses can be sold or maintained if sold because of the faltering economy. I have driven past some houses I know were renovated with federal monay and they are vacant. Some are in bad shape.
What do others think? |
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Wed Jan 19, 2011 9:10 am |
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untanglingwebs
El Supremo
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American Cities That Are Running Out Of People
Posted: December 27, 2010 at 11:11 pm
The population of the United States has increased steadily by roughly 2.5 million people every year since World War II. Throughout prosperity and hard times, Americans continue to have families. Many of the country’s regions have expanded to accommodate this population increase. Some cities have grown faster than others as the result of being at the center of some important new technology or job market. Others have lost residents because of failing industries and migration. Nevertheless, some of these cities have continued to grow slowly, or at least remain relatively stagnant, buoyed by the rising tide of the national population.
There are some cities, however, which have experienced such severe hardship and decline that their populations have actually decreased significantly. New Orleans has lost more than a quarter of its population in the past ten years as the result of Hurricane Katrina. The rest of the cities that have lost major parts of their population have seen their flagship industries which include coal, steel, oil, and auto-related manufacturing fall off or completely collapse. America moved away from its status as an industrial superpower in the second half of the 20th century as the services sector rose to replace it. Millions of US manufacturing jobs have moved overseas. Cities such as Rochester, Cleveland and Buffalo declined in population because they were trade hubs, and new modes of transportation removed their geographical dominance. Cities like Flint, Michigan have economies based on a single major industry. In Flint’s case, that industry is auto manufacturing. When that industry began to decline, Flint was unable to diversify to prevent a population exodus.
All of the cities on this list experienced at least one of these devastating problems which have caused tens of thousands, and in some cases, hundreds of thousands of its residents to leave the region for other jobs and other homes. While it has been the primary focus of these cities to create new sources of employment for their residents, it may be years before people return, if they do at all.
Unfortunately, the populations of most of the cities on this list continue to decline and the situation could get worse for years. This loss of residents has caused severe drops in the social services that many of these cities can provide. Property and other taxes have fallen so much that the support that residents of other cities take for granted is at risk in the municipalities on this list. There is no longer any guarantee that they can maintain police and fire departments at reasonable levels. Some of these cities cannot continue to manage large neighborhoods which have become almost deserted as residents have left unoccupied homes behind. Home vacancy rates tell a great deal about how much a city’s population has dropped.
24/7 obtained its population data from the U.S. Census Bureau’s Population Division. Housing Vacancy came from the Census Bureau’s American Community Survey. This is a list of the seven American cities that have lost the most people in the past decade.
7. Rochester, NY
Population: 207,294
Population Change 2000-2009: -12,180
Population Percent Change 2000-2009: -5.55%
Home Vacancy: 15.3%
The City of Rochester was once a booming trade center, largely due to its location at the midpoint between Albany and Buffalo on the Erie Canal. At its peak, the city was the major flour processor in the country, and was home to several key corporations including Xerox and Eastman Kodak. Rochester declined as the usefulness of the canal went out with the advent of railroads and its flagship companies began to lose their relevancy in the larger global economy. Rochester has yet to produce an important replacement industry to drive up the population, and even the success in the 1990’s of Xerox has faded. Between 1950 and 2000, Rochester lost 34% of its population.
6. Pittsburgh, PA
Population: 311,647
Population Change 2000-2009: -22,056
Population Percent Change 2000-2009: -6.61%
Home Vacancy: 14.1%
Known as the “Steel City,” Pittsburgh was once the forge for the American industrial engine from the late 1800′s through the late 1970′s. At its peak, the city was home to more than 1,000 factories, including the mills owned by Pittsburgh-based U.S. Steel, which by itself employed over 340,000 workers during World War II. As the American steel industry collapsed in the 19 80′s Pittsburgh suffered severe unemployment problems. In the past few decades, the city changed to a technology-based economy, but the population is still on the decline. Since 1950, Pittsburgh’s population has declined by more than 50%.
5. Dayton, OH
Population: 153,843
Population Change 2000-2009: -11,961
Population Percent Change 2000-2009: -7.21%
Home Vacancy: 18.9%
For its size, Dayton, Ohio was once one of the most productive and creative cities in the U.S. It produced more patents per capita at the turn of the century than any other. The city was home to several former great Fortune 500 companies, including National Cash Register, Mead Paper and Phillips Manufacturing. Through the first half of the 20th century, Dayton had one of the healthiest manufacturing industries. It had more GM autoworkers than any city outside of Michigan during World War II. In the past 50 years, Mead has merged with West Virginia Paper and moved to Richmond, and GM has closed one plant after another in the city.
4. Buffalo, NY
Population: 270,240
Population Change 2000-2009: -21,970
Population Percent Change 2000-2009: -7.52%
Home Vacancy: 17.2%
Another victim of the Erie Canal boom and bust, Buffalo was the 13th largest city in the country just before WW II. It is now the 70th. Like Rochester, the city was once a premier mill town due to its location to the canal. Massive electricity generation from Niagara Falls improved Buffalo’s industrial capacity, and the city referred to itself as the “City of Lights” for a time because of its power production. The collapse of the canal and improvements in the energy industry which made Niagara Falls less important led to the mass migration from the city which continues to this day. In the 1970′s alone, Buffalo lost more than 100,000 residents, roughly a third of its current population.
3. Cleveland, OH
Population: 431,369
Population Change 2000-2009: -45,205
Population Percent Change 2000-2009: -9.49%
Home Vacancy: 17.5%
Cleveland, the largest city on our list, was once a thriving manufacturing center, as well as an important point of trade because of its connection to several key routes particularly Lake Erie. The city was once home to a sizable auto industry. Most of the largest companies which were once based in Cleveland no longer exist. These include Peerless, People’s and Winton. Cleveland also served as headquarters for John D. Rockefeller’s Standard Oil Company, as well as a key import location for coal and iron shipped from the South and Midwest. The decline of industrial American has hit the city particularly hard, and poverty, a default on municipal debt in the 70′s, and pollution have earned the city the nickname “the mistake on the lake.” In 1948, the city had over 910,000 people; it now has less than half of that.
Also Read: Start Stop Technology Coming To Ford Cars
2. Flint, MI
Population: 111,475
Population Change 2000-2009: -13,266
Population Percent Change 2000-2009: -10.63%
Home Vacancy: 18%
While most of the cities on this list are here as the result of a general decline in industry, Flint’s woes have come almost entirely from one sector – the auto industry. Flint became a boomtown at the turn of the century as it became a divisional headquarters to the major American auto manufacturers, including Chevrolet, Buick, and General Motors. Between 1910 and 1930, the population had more than quadrupled due to the success of the American car business. Since the American auto industry began its decline in the 1980′s, Flint has consistently lost at least 10% of its population each decade. Massive layoffs and plant closings have devastated the city, and unemployment rates remain well into the double digits.
1. New Orleans, LA
Population: 354,850
Population Change 2000-2009: -128,813
Population Percent Change 2000-2009: -26.63%
Home Vacancy: 21.5%
New Orleans is unique in that its presence on this list is not due to industrial decline, but from natural disaster. Hurricane Katrina flooded 80% of the city, caused by some estimates more than $80 billion in damage, and displaced tens of thousands of residents. The period of widespread homelessness, severe crime, and slow recovery has left the city as a shadow of its former self. While people are trickling back into the city, many will likely never return, and the city has lost more than a quarter of its population in just ten years.
-Michael B. Sauter |
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Wed Jan 19, 2011 9:35 am |
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untanglingwebs
El Supremo
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Home prices fall in major US cities
By ALEX VEIGA, AP
19 hours ago
LOS ANGELES — Home prices are falling across most of America's largest cities, and average prices in eight major markets have hit their lowest point since the housing bust.
The Standard & Poor's/Case-Shiller 20-city home price index released Tuesday fell 1.6 percent in November from October. All but one city, San Diego, recorded monthly price declines.
Eight others sank to their lowest levels since prices peaked in 2006 and 2007: Atlanta, Charlotte, N.C., Las Vegas, Miami, Portland, Ore., Seattle, Tampa, Fla., and Detroit, which saw the largest drop at 2.7 percent from the previous month.
Millions of foreclosures are forcing prices down, and many people are holding off making purchases because they fear the market hasn't hit bottom yet. Many analysts expect home prices to keep falling through the first six months of this year.
"With these numbers, more analysts will be calling for a double-dip in home prices," said David Blitzer, chairman of S&P's Index Committee.
Over the past year, prices have risen in four major metro areas. Prices rose 3.5 percent in Washington, the largest gain. Los Angeles, San Diego and San Francisco also posted gains.
Some of the worst declines have come in cities hard hit by foreclosures.
As of November, average home prices in Las Vegas have fallen 57.2 percent from their peak in August 2006 and are back to where they were in late 1999. Another foreclosure hotbed, Phoenix, is down 53.9 percent from its June 2006 peak. Average home prices there are back to where they were in 2000.Miami has fallen 48.8 percent from its peak in December 2006, and is selling at late 2002 levels.
The 20-city index has risen 3.3 percent from its April 2009 bottom. But it remains well below its July 2006 peak.
Copyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed. |
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Wed Jan 26, 2011 7:33 am |
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untanglingwebs
El Supremo
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Monday City Council report by Assessor William Fowler
For last 3 years,there was a 22% drop in the tax base for the first 2 years. This year there is a 15 to 18 % drop in the tax base and the drops will not be expected to bottom out until the year 2013.
2010 the tax base was $1billion 300 million.
In a report run Monday morning the tax base was $1 billion 125 million, a loss of $175 million.
The assumptions made in the Deficit Reduction Plan sent to the state were made prior to the release of this report, which led council to assume the income projections were too optimistic. Watch Comcast 17 next Sunday at noon to see the discussion.
De;rico Loyd was upset that the administration sent the plan to the state without giving it to council first.
I am told that a letter of support from the communities governing body is always required with this plan. Treasurer Michael Townsend said it was not but that the state is now requiring the letter of support and that is why it was given to council.
Word on the street is no one in the administration knows how to even call to get on the state agenda for the hearing. |
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Wed Jan 26, 2011 7:46 am |
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Dave Starr
F L I N T O I D
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quote:
untanglingwebs schreef:
Word on the street is no one in the administration knows how to even call to get on the state agenda for the hearing.
1-517-666-6639
(1-517-MO Money) |
_________________
I used to care, but I take a pill for that now.
Pushing buttons sure can be fun.
When a lion wants to go somewhere, he doesn’t worry about how many hyenas are in the way.
Paddle faster, I hear banjos. |
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Wed Jan 26, 2011 9:08 am |
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