Last week, I heard someone complain that the housing market was “bad.” Well, when housing appreciated 10-20% per year, I heard other people complain that the market was “ridiculous.” The truth is that the housing market has never been healthier. Now that the recession has washed away a lot of the speculative excess, housing is affordable again IF you have cash. The problem plaguing the housing market isn’t so much a crisis of confidence on the part of buyers, but the locked up credit market with wide spreads for jumbo and investment property mortgages. Once those spreads narrow, you’ll really see the pace of real estate investment accelerate.
Tag: recession
-
Recession Special
Could really have used a polarizing filter to cut down the reflection in the window. Anyways, I spotted this sign in the window of a Thai restaurant in Millbrae over the weekend.
Special Lunch Dishes Today For Those People Who Are Unemployed.
Any noodle dish with your choice of chicken, pork, beef or veggi $5.50On one hand, it’s really compassionate for them offer a reduced price meal to those who are unemployed. However, if you really have no income flowing in, even a $5.50 lunch may seem extravagant because every dollar adds up.
-
Sign of the Times: Not Hiring
Spotted the “Not Hiring” sign during the weekend. You think a few people have already stopped by to ask about job openings? From what I hear, construction work has come to a dead halt. So, any contractor that is building in this economy will be very popular. Anyways, the sign really means a lot of people are looking for work. Enough at least that it is worth it to the contractor to put up a sign.
-
The Meaning of Gasoline Prices
Five months ago, I had to pay $4.55 per gallon for regular unleaded at the local Valero gasoline station. At the time, gasoline prices were just 10% away from hitting the $5.00 per gallon mark. So, if I was offered a bet on whether gasoline prices would be over $5.00 or under $2.50 in five months, guess which way I would have wagered? However, here we are in the middle of November and regular unleaded is $2.35 per gallon. So, what does this all mean?
Right now, I am not sure. Was it oil speculators that previously drove up the price of gasoline? Or, is the economy that badly off to dry up demand for gasoline? In some parts of the Bay Area, the signs of the real estate deflation are obvious. However, in other cities, housing prices remain pricey. I always thought demand for gasoline was relatively inelastic. Everyone has to drive, right? However, if the demand for gasoline is true off kilter, then we are all headed for trouble times, regardless of which neighborhood we live in.