Download 11% - Nebraska Investment Finance Authority

Market Overview
January 2011
Total Single Family Sales for Jan-Nov
2007 vs. 2008 vs. 2009 vs. 2010
Douglas and Sarpy Counties
7416
7,000
7425
6524
6097
6,000
5,000
4,000
3,000
2,000
1,000
0
2007
2008
2009
2010
Sales Trends
2009 vs. 2010
-16%
8000
7000
6000
5000
-24%
2009
4000
2010
3000
-11%
2000
+6.5%
1000
+5%
+4%
400,000
600,000
0
75,000
150,000
250,000
Overall
Total Sales
2009 vs. 2010
1200
1100
1000
900
800
700
600
500
400
300
200
100
0
UG
SE
PT
O
C
T
N
O
V
D
EC
A
L
JU
N
JU
AY
M
PR
A
AR
M
B
FE
JA
N
2009
2010
Inventories
Increase in 2010
+12%
3000
2500
2000
1500
+17%
Dec-09
+11%
1000
Dec-10
+13%
500
-7% +3%
0
75,000
150,000 250,000 400,000 600,000 TOTAL
New Construction
Inventories
Increase in 2010
+8%
600
500
400
+4%
300
+19%
200
100
Dec-09
+15%
Dec-10
-16%
-45%
0
75,000
150,000
250,000
400,000
600,000
TOTAL
Median Price
$75,000 - $150,000
1%
Median Price
$150,000 - $250,000
1%
Median Price
$250,000 - $400,000
2%
Median Price
$400,000 - $600,000
2%
Median Price
$600,000 - $2,000,000
11%
Total Sales
Fall ’09 vs. Fall ‘10
700
600
500
2009
2010
400
300
200
100
0
SEPT
OCT
NOV
DEC
Consumer Expectations Survey
AUG
MAY
JULY
NOV
JAN
2007
2010
2010
2010
2011
89.2
85.3
66.6
74.2
80.3
2010-2011
GDP FORECAST
FANNIE MAE
Q3
2.1
Q4
0.7
Q1
1.2
Source: http://www.fanniemae.com/media/economics
Q2
0.9
NATIONAL HOUSING FORECAST
FANNIE MAE
2009
Mean
2010
Mean
2011
Forecast
Mean
5,530,000
5,199,000
5,432,000
CHANGE -6%
CHANGE +5%
Nebraska Economy
Agriculture
Insurance
Manufacturing
Transportation
Housing
Strong
Strong
Down
Down
Down
Never has a “bubble
Unemployment
Lowest Rate in the U.S.
Strong
Nebraska Purchasing Manager Index
70
35.9 35.9
59
60
50
53
47
52
51
50
54
63
63
64
65
63
57
57
56
50
52
40
30
20
10
0
Aug- Sep- Oct- Nov- Dec- Jan- Feb- Mar- Apr- May- Jun- Jul- Aug- Sep- Oct- Nov- Dec09 09 09 09 09 10 10 10 10 10 10 10 10 10 10 10 10
Source: http://www.creighton.edu/business/economicoutlook/index.php
2010 VS. 2009
Non Ag. Business/Finance
+1.5%
Manufacturing
+2.5%
Construction
No Growth
UNL Bureau of
Business Research
1.) Recovery likely to continue
2.) Rick of Double Dip Recession
3.) Weakness in Real Estate sector
“FEARFULLY OPTIMISTIC”
Positives
1. Lower House Prices
2. Higher savings rates
- Lower indebtedness
- Spending in line with income
3. Income growth supports
- Consumption
- Job Growth
- Rising working hours
Positives cont.
4. Business Growth
- Exports
- Technology
5. Fiscal Government restraint
- Divided Federal Gov’t
- Cost restraint Federal and State Levels
- Gov’t cost restraint would encourage
investment
* Domestically
* Internationally
Negatives
• Slow new construction
• Buyers inability to sell existing home to
enable purchase of a new home
• Increased remodeling
• Strong refinance activity
The 2011 Outlook
Omaha Outlook
Employment
Population
Income
New Jobs
Self Employed
Labor Force
Unemployment Rate
+1.5%
+1.5%
+4.5%
7000
Strong Growth
Slow Growth
to 4.5%
Source: UNL Bureau of Business Research
The 2011 Outlook
Real Estate Markets
1. Improving Consumer Expectations
2. Improving Omaha Economic Conditions
3. Moderate but steady increase in activity in
early 2011
4. High Inventories
5. Prices initially soft but firm up as
inventories decline
The 2011 Outlook
HIGH END HOUSING
Market focus on “needs” vs. wants
Conservative buyer behavior
High Real Estate Taxes
Soft Pricing Trends
The 2011 Outlook
1. Dependant on Market Mood
a. Election - Done
b. Tax Laws - Done
c. Diminished expectation of new
“stimulus”
The 2011 Outlook
2. Pent up Demand
a. Build up of buyers who went to the
sidelines
b. New buyers/sellers will move for
typical reasons
c. Could result in an active spring
market
The 2011 Outlook
General Market
Sales fall between 2008 and 2009 levels
Mean for 1st half of 2008 & 2009
693 sales per month in 2008
vs.
806 sales per month in 2009
www.mitchellassociates.com
Thank You