Here is what the article says about housing: ”
New-home sales in 2010 drop to their lowest level in 47 years
Buyers purchased the fewest number of new homes last year on records going back 47 years.
Sales for all of 2010 totaled 321,000, a drop of 14.4 percent from the 375,000 homes sold in 2009, the Commerce Department said Wednesday. It was the fifth consecutive year that sales have declined after hitting record highs for the five previous years when the housing market was booming.
The year ended on a stronger note. Buyers purchased new homes at a seasonally adjusted annual rate of 329,000 units in December, a 17.5 percent increase from November’s pace. Still, economists say it could be years before sales rise to a healthy rate of 600,000 units a year.”
The new housing sales are the big number to pay attention to because they are a trailing indicator of economic activity. The logic goes like this: New Job, New Car, New House!. No new houses means that something is broken and has continued to stay broken for the last 5 years. What does this mean for real estate in your area? It depends on the local economic activity of your area. In Austin we are experiencing slow job growth (2% in 2010) and lower unemployment 7.3 (or something like that for 2010). If new houses are not being built for those new jobs then we should be seeing rents increase or give-a-ways drop off, or a combination of the two. Have we been seeing those things happen?
YES!!!! YEAH for the rental real estate game!