Memorial Day – A Time for Remembrance

A select few Photo’s of the World War II Memorial
and the Washington Monument taken from the WW II Memorial
Washington DC

Thank you to all of our veterans and military men and women for your sacrifice. And for your diligence in protecting our freedom and our country. 

1st QT Economic News

"Economic Rebound Slowed Last Quarter" - an article By JEANNINE AVERSAAP - See full article from DailyFinance: http://bit.ly/dbztav  The following excerpts are from the above referenced article by Ms. Aversaap.

 

In previous posts, I have discussed the link between housing, unemployment rate and economic recovery.

• The economy grew at a 3 percent annual rate from January to March
• 9.9% unemployment rate in April 2010
• Economists say it takes about 3 percent growth to create enough jobs just to keep up with the population increase.
• Economic growth would have to be about 5 percent for a full year just to drive the unemployment rate down 1 percentage point.
•  The National Association for Business Economics predicts moderate economic quarterly growth in the 3 percent range through the rest of this year.

So……. If I understand article correctly, the economy is growing but not helping the unemployment rate. I guess this is what they call a jobless recovery.
7-8% unemployment rate would seem to be a logical goal at the moment. Although still high, this is rate is manageable.  

• At 5% economic growth, the 8% unemployment rate goal would not be achieved until 2013.
• At 10% economic growth, the 8% unemployment rate goal would not be achieved until 2012.

Where will the economic growth come from to reach a 5% or an unbelievable 10% growth rate? Ask around and post your thoughts.

 

Next week will be devoted the importance of knowing your local market and forgetting about the above national statistics. I think the national perspective is important to know but the local market impacts your business day-to-day. Do not become frozen in-place.

  

We must become experts in our local markets and act positively.

 

NOW is the time to Rebrand, Reinvent and Re-energize your business.

 

SBA Loans

In yesterdays post , I asked if anyone was going to apply for a SBA loan due to the new incentives for small businesses. Today's report out of Washington DC by the Small Business Administration is that they have again run out of money for their programs and a waiting list has been re-established.

90% government guarantee of a SBA 7 (a) loan.

Government reduced or eliminated fees on 7 (a) and 504 loans.

I applied for and received a SBA loan in 2001 and it worked for me at the time. I think it is time to investigate again. I will keep you posted. Please share your thoughts and opinions on SBA loans - the paperwork is beyond understanding!

AMERICA'S NATIONAL DEBT

Remember trends rather than percent changes:

TOPS $13,000,000,000,000  Trend UP

DEBT PER TAXPAYER - $117,975  Trend UP

US DEBT TO GDP RATIO - 90.3%  Trend UP
 
Now that some breaks may come our way for small businesses or the self employed, raise your hand if you will be applying for a SBA Loan anytime soon.

2009 Top 10 Multifamily Builders : BuildersSurvey

Vanishing Giants - It’s not a mistake: The industry’s longtime major players didn’t make the 2010 rankings.
By: Les Shaver
BUILDER May 2010

The large multifamily builders which traditionally fill the top ten spots have focused their operations on asset management rather than new construction. As this portion of the industry turns around, the competition for mulitfamily zoned land will become strong in many markets. However, in my opinion, approved and unimproved multifamily projects (on the shelf) will satsify the demand in most markets for the immediate future of the housing recovery. I would also expect to see company consolidation through acquisition. The top ten multifamily builders of 2010 may not look much differrent from the above list but will most likely change dramatically in 2011 and beyond.  

Q1 Charlotte Market Reports

LoopNet's Q1 2010 overall sales in Charlotte, NC decreased 74% compared to the prior year.

Over the last 12 months, the price per square foot for:





Office property is down 73%

Multifamily is up 26%

Industrial is down 32%

Retail is up 12%.

Land is down 40%

What is Your Economic Recovery Confidence Rating?

It has been reported that home builder’s confidence level rating increased and housing starts rose to an annual rate of over 670,000 units in April.
The trend is up but far from the average annual start rate of 1,200,000 units.
Builders have reduced inventory and responded to the federal tax credit which spurred sales.
Builders in many markets have re-designed their product line to lower prices.
We can be positive about the increase in starts and a trend up in builder confidence.

As the population continues to increase and family formations are being created every day, there will be a pent-up demand. In the short term foreclosures and short sales may satisfy that demand rather than new home sales. In the lon term, it is new residential construction "with good sales" that jump starts and sustains our economy.

I certainly not an expert but in my opinion, family formations are being delayed due to the lack of jobs.
Let’s watch for statistics on the college graduating class this year – most will return home to live with their parents without a job, just my guess.

It just seems to me that we are in a vicious cycle. Unlike the past four recessions, lowering interest rates was the answer. Today, low interest rates continue to be at historic lows.

“Green jobs” will not be the answer. It is ok to move toward a green economy but it is not a panacea. And, adding federal government jobs will not be the answer. After all, many state and local governments have either reduced headcount or instituted a hiring freeze.

All I can tell you is from my own personal experience.
We have dramatically cut our spending.
We are using my 1980’s phrase: “Nice but not necessary.”

So, what is your confidence level rating on our economic recovery?

Upcoming Series of Webinars

As outlined in my previous blog posts, I will be launching a series of webinars on:

Real Estate Development Basics

Investment Strategies

Land Development Engineering

The intent is to outline opportunities which may be out of your comfort zone, may reinforce your thoughts, or may provide you “the idea”. If you want to ride the wave of change rather than react to trends, you may want to attend one of my webinars – and let your contacts know as well.

All of the webinars will be between 1-2 hours, affordable, and discounted for followers of my blog, for my contacts, and for the members of my LinkedIn Land Development Group.

RelocateAmerica's Top 10 Best Places to Live in 2010

Of the top 10 best places to live in 2010, there are only three of these cities which were selected as areas predicted to have over 3% employment growth over the next four years. (See my previous post.)

Raleigh, North Carolina

Austin, Texas

Charlotte, North Carolina

You may want to consider these three cities to expand your operations, relocate your business or enter a new market. Combining a sense of community and a positive work environment may be just the answer as the economy rebounds. Come on down!

The other cities on the list included:

                                                        Boulder, CO

                                                        Huntsville, AL

                                                        Minneapolis, MN

                                                        San Antonio, TX

                                                        San Diego, CA

                                                        Tulsa, OK

                                                        Washington, DC

We moved to Charlotte in 2005 for many of the reasons outlined in the above articles. In my opinion, Charlotte provides a pro-growth government structure, trend setting design standards, and ample land for development purposes within 10 miles of “Uptown” Charlotte. Come on down!

Blog Titles - Last Week

“The Thirteen Housing Markets that will Never Recover”

Double Dip in some Housing Markets

Job Creation Where?

Government’s Latest Jobs Report

Small Business Owners still Doubtful about Economic Turnaround

Charlotte NC Real Estate Snapshot – March 2010

My blog posts over the past week have been merely reporting of certain facts found through diligent internet research – not really! Actually, information easy to find about the housing industry and jobs – if someone choose to look. This is my 4th recession, early 70’s, early 80’s, early 90’s and late 2000 The mild recession in early 2000 was a blip for housing – we should have known then that there was something historically wrong occurring. This recession is different.

My posts although not positive are intended to provide statistics, data and insight on the housing industry (national trends) to assist you in your rebranding, reinventing and re-energizing you and your business.

Each local and regional market is vastly different and it is all too easy to be influenced by national trends when local trends may be remarkably better. As an example – do you have a new housing development or commercial project under construction in your area? Developers and builders are starting projects but not as many as we have been accustomed to over the past 10 years. Oh well. Shake off the national overview and focus on your local market.

Think about how you do what you do differently.

In my opinion, those that become an expert in their local market and use this time to rebrand, reinvent and re-energize themselves will be the leaders others will want to follow.

What are you doing today to help yourself for tomorrow?

The Thirteen Housing Markets That Will Never Recover

1. Riverside, CA. Housing prices are down 52% and unemployment is at 18%
Joblessness 25%

2. Lansing, MI. Housing prices are off 38% and unemployment is 11.8%
Joblessness 19%

3. Palm Coast, FL. Housing prices down 63% and unemployment is 16%
Joblessness 23%

4. Sacramento, CA. Housing prices down 47% and unemployment is 17.5%
Joblessness 25%

5. Orlando, FL. Housing prices down 49% and unemployment is 15%
Joblessness 22%

6. Fort Meyers, FL. Housing prices are down 65% and unemployment is 14.2%
Joblessness 21%

7. Grand Rapids, MI. Housing prices are down 30% and unemployment is 14.3%.
Joblessness 21%

8. Reno, NV. Housing prices are down 44% and unemployment is 13.3%.
Joblessness 20%

9. Toledo, OH. Housing prices are down 30% and unemployment is 13%.
Joblessness 20%

10. Boise City, ID. Housing prices are down 34% and unemployment is 9.9%
Joblessness 17%

11. Rockford, IL. Housing prices are down 16% and unemployment is 17.9%
Joblessness 25%

12. Las Vegas, NV. Housing prices are down 51% and unemployment is 13.8%
Joblessness 21%

13. Providence, RI. Home prices down 27% and unemployment is 13.2%
Joblessness 20%

By: Douglas A. McIntyre
24/7 Wall St.
Sources: Home Prices: NAR
Unemployment: Bureau of Labor Statistics

Note: I added the joblessness rate for each city using the current national difference between unemployment rate of 9.9% and the joblessness rate of 17.1% and used the same relationship for each city. Using home price declines and unemployment rates paints a grim picture for these cities - and this is only a snapshot. The article’s title “...... Markets that Never will Recover”.

Please copy and send this to your contact lists. Don’t you think it is time for help for these markets?

Why not start with JOBS, JOBS and more JOBS first? As housing goes so goes the economy!

Double Dip in some Housing Markets

As per Zillow and their statistical analysis, they have published ten cities which are experiencing a double dip recession in the real estate market. I have selected three cities for comparison and added the unemployment rate as of March 2010.

Columbus, Ohio Unemployment Rate 9.8%
Original Months of Decline: 19
Months Upward Price Trend: 7
Current Months of Decline: 5
Peak Values: $149,800 (July 2006)
Fall from Peak: -8.7%


Providence, R.I. Unemployment Rate 13.2%
Original Months of Decline: 40
Months Upward Price Trend: 6
Current Months of Decline: 4
Peak Values: $303,600 (Oct 2005)
Fall from Peak: -26.5%


Greensboro, N.C. Unemployment Rate 11.5%
Original Months of Decline: 17
Months Upward Price Trend: 6
Current Months of Decline: 5
Peak Values: $141,200 (Sept 2007)
Fall from Peak: -9.2%

Statistics should be verified through the local Realtor® Association. However, the double dip in certain housing markets is a reality. I could conclude that the second trend down has been during 2010. This is not comforting since the sales pace should have increased due to the federal tax credit extension opportunity. An increase in demand and decrease in inventory should stabilize prices. Local markets experience local problems that affect the demand and supply curve.

Check out your local market statistics.

JOB Creation – Where?

TIME Magazine, March 29, 2010 issue forecasted where jobs would best be created and rate of increase once the economy is trending up from the recession. The illustration shows the locations anticipated for job growth. In the article, they also provided an illustration on what type of jobs would be created. It is an interesting prediction but safe forecast. After all, construction is the one industry most devastated by the recession and should rebound. Especially in areas where housing most impacted by the housing “bubble” – Las Vegas, Florida, Atlanta, and southern California. Texas prediction may be related to energy. Southeastern states seem to be the one region having a wide range of positive job gains. Specifically, Charlotte would be an excellent choice for business expansion in home building, commercial construction, and corporate relocations.

The key to such predictions is WHEN? My two cents --- not anytime soon. If there is a positive trend in job creation, it will be slow and unpredictable. However, let’s don’t get lost in national forecasts when local markets will control our future.

We have to do what we do differently. Rebrand, reinvent, and re-energize your business. Positon your business to increase market share as the economy rebounds.

Government’s Latest Jobs Report

The Labor Department published their April jobs report and it is encouraging and discouraging at the same time. Jobs have been added for three consecutive months but the unemployment rate increased from 9.7% to 9.9%. The only reason for this increase is that new job seekers are entering the market. Thus, the “underemployed” is more of an issue than reported and should be a concern.

In April the “underemployment” rate is 17.1% which includes part-time workers and people who have stopped looking. I contend this is even higher due to the lack of reporting of the self-employed. The report also outlines what sector jobs are being added:

Manufacturing 44,000
Restaurants & Bars 21,000
Health Care 20,100
Construction 14,000
Retailer 12,400
Computer Services 7,300

Since I am not an expert but enjoy the statistics, the above job types really lack substance to sustain a recovery. The media cited the positive numbers in construction as a significant turnaround. This represents less than 300 jobs per state! Let’s watch this number as the Labor Department issues subsequent jobs reports.

Will there be a trend up in construction?

We certainly are entering the construction “season”.

Let’s hope this positive movement is a serious trend. If so, is your business ready for the turnaround?

The following two illustrations are from TIME Magazine, March 29, 2010 issue. By the way, please take note of the number of unemployed workers per job opening in construction.

Small Business Owners Still Doubtful about Economic Turnaround

Article by JULIA L. ROGERS, AOL SMALL BUSINESS, Posted: 2010-04-27

Small businesses contribute 50% of the Gross Domestic Product

Small businesses with less than 50 employees responsible for 33% of new job creation

National Federation of Independent Business Organization has a monthly small business optimism index:

Current 86.8 – 18th month below the 90 value

The trend continues down since the index fell 1.2 points last month

1981 Recession – index dipped below 90 for only 3 consecutive months

Many small businesses are builders and developers – in 2008, it was estimated that there were around 1,000,000 builders which are either out of business or have scaled back considerably. As you know, I consider the housing industry to be the leader into and out of a recession. Large companies seem to be improving but not small businesses and not home building. In the home building industry, the large national builders have been gaining market share for years.

As we bounce along the bottom of the recession, is this the start of a paradigm shift in the building industry? Especially when “too big to fail” has been the basis in which public policy is being molded. The positive economic news is good to hear.

But, what about assisting small businesses succeed since their contribution to the economic recovery is significant? Will the army of small volume builders disappear?

Charlotte, NC Real Estate Snapshot – March 2010

Source: Carolina MLS per price range

Closed Units                 Price Range Active                 Listed Units

675                                  < 120K                            5,553

290                             120K - 150K                           3,192

277                             150K - 190K                           3,604

256                             190K - 250K                           3,825

184                             250K - 350k                            3,578

113                             350K - 500K                           2,717

89                               500K – 1M                              2,294

16                                 $1million+                               773

1,900                             TOTAL                               25,536

Remember, the federal tax credit expired at the end of April and units must close by the end of June. I will provide update statistics late this summer to appreciate differences and trends. The supply has stayed relatively constant and the absorption rate remains lackluster. How does your market compare?

You may want to use these Twitter Tools?

Bird Feeder use targeted criteria to locate other users

Twello search public accounts to locate other users

Future Tweets schedule tweets to be sent at a later time

Tweepler save followers in categories

Twibs search for businesses on Twitter

Grouptweet send a message to your contact list

Tinyurl shortens long URL’s and saves for use

I have used tinyurl and it is convenient to use in social networking. I would recommend this approach and it is free. I have not used the other tools but several seem to be worth the effort to learn. If you should know of any other tools, please post for others to consider.

32 Ways to Use Facebook for Business

Posted by Lacie Moore on January 31, 2010 in “How to use Facebook”
Facebook’s not just for keeping tabs on friends and filling out quizzes — it can also be used as a highly effective business tool. It’s great for marketing your products, landing gigs and connecting with your customers. Here are 32 ways to use Facebook in your business.

1. Fill out your profile completely to earn trust.

2. Establish a business account if you don’t already have one.

3. Stay out of trouble by reading the Facebook rules regarding business accounts.

4. Install appropriate applications to integrate feeds from your blog and other social media accounts into your Facebook profile. (Although you should be careful before integrating your Twitter feed into your Faceboook profile, as a stream of tweets can seem overwhelming to your contacts.)

5. Keep any personal parts of your profile private through Settings.

6. Create friends lists such as “Work,” “Family” and “Limited Profile” for finer-grained control over your profile privacy.

7. Post a professional or business casual photo of yourself to reinforce your brand.

8. Limit business contacts’ access to personal photos.

9. Post your newsletter subscription information and archives somewhere in your profile.

10. Connect and share with others Obtain a Facebook vanity URL so that people can find you easily.

11. Add your Facebok URL to your email signature and any marketing collateral (business cards, etc.) so prospects can learn more about you.

12. Post business updates on your wall. Focus on business activities, such as “Working with ABC Company on web site redesign.”

13. Share useful articles and links to presentation and valuable resources that interest customers and prospects on your wall, to establish credibility.

14. Combine Facebook with other social media tools like Twitter. For example, when someone asks question on Twitter, you can respond in detail in a blog post and link to it from Facebook.

15. Before traveling, check contacts locations so you can meet with those in the city where you’re heading.

16. Research prospects before meeting or contacting them.

17. Upload your contacts from your email client to find more connections.

18. Use Find Friends for suggestions of other people you may know to expand your network even further.

19. Look for mutual contacts on your contacts’ friends lists.

20. Find experts in your field and invite them as a guest blogger on your blog or speaker at your event.

21. Market your products by posting discounts and package deals.

22. Share survey or research data to gain credibility.

23. Use Facebook Connect to add social networking features to your web site.

24. Suggest Friends to clients and colleagues — by helping them, you establish trust.

25. Buy Facebook ads to target your exact audience.

26. Read up on Facebook Beacon to see if it might be useful for you.

27. Use Network, Group and Fan Pages Start a group or fan page for product, brand or business. Unless you or your business is already a household name, a group is usually the better choice.

28. Add basic information to the group or fan page such as links to company site, newsletter subscription information and newsletter archives.

29. Post upcoming events including webinars, conferences and other programs where you or someone from your company will be present.

30. Update your group or fan page on a regular basis with helpful information and answers to questions.

31. Join network, industry and alumni groups related to your business.

32. Use search to find groups and fan pages related to your business by industry, location and career.

Start Your e-Newsletter

Steven D. Strauss is one of the country's leading small business experts. The senior USATODAY.com small business columnist and he recently interviewed Eric Groves, the senior VP of worldwide development for Constant Contact.
Constant Contact has perfected relationship marketing and assists small businesses with e-mails, e-newsletters, and other online marketing tools.
Steven Strauss cites “according to Groves, the real secret to connecting online is to create content that engages your audience, that helps them solve problems, and that is interesting and useful.

And, he says, by offering that content as part of a consistent e-newsletter, you not only get permission from your customers to check in with them regularly, but also, they often end up forwarding the e-newsletter on to their network so that you also get some free word-of-mouth advertising.

As Groves says, the important thing is to offer content that people like. Usually, the best
e-newsletter content offers ideas that help the reader.

The actual process of creating your e-newsletter is fairly straight-forward:
- Come up with a great name.
For instance, their free e-newsletter is called Small Business Success Secrets!

- Create your content: You don't have to be a great writer, but you do have to offer something of value. Draft some short articles that both shares your expertise and which you think your customers would find interesting.

- Get them to opt-in: Have a link on your homepage where people can sign up by giving you their email address.

- Create a template: The easiest way to draft and send an e-newsletter is by having a great provider. What you want is a service, i.e. Constant Contact that will give you customizable templates, easy to use tools, database management, the ability to track open rates, and the like.

- Blast it!”

The above was copied from the article by Steven Stauss. You may want to consider an
e-newsletter blasted to your sphere of influence on a regular basis. This would be especially effective with your LinkedIn contact list. Although Constant Contact is selling a service, an e-newsletter idea has merit which can easily be managed once the template has been created. Using current software, this networking tool can be managed without the need for a service group.

Another Alarming Housing Statistic

Real Time Economics is a Wall Street journal blog on economic insight and analysis. On April 24th, the WSJ Blog outlined housing an inventory problem which is very alarming when combined with other factors. Their insight identifies a serious concern compounded by high unemployment. In my opinion, “bubble” prices only become a problem if someone has to sell their home.
In the article written by Mark Whitehouse, the following statistics were highlighted:

As of March 2010, banks had an inventory of approx. 1,100,000 foreclosed homes.

About 4,800,000 mortgage holders were at least 60 days behind on their payments or in the foreclosure process

Based upon the sales pace of foreclosed homes, it would take 103 months for banks to work through the inventory.

Without new jobs being created, an increase in foreclosures could be expected. Also, banks may increase the sales rate of foreclosed homes by lowering prices which will impact appraisals. For those families with jobs but have decided to move, the appraisals will affect the sales price of their home – the vicious cycle continues.

A legitimate question would be “how to you stop this vicious cycle?” The answer is JOBS. However, I would not expect the housing sector adding jobs anytime soon.

Bernanke: Budget Deficits May Push Interest Rates Higher

Posted May 1st 2010 4:40PM by Connie Madon
Filed under: Market Matters, Economic Data, Federal Reserve

“It's an age-old dilemma. Congress loves to spend taxpayer money. The problem is that Congress is spending money that they don't have, racking up huge budget deficits.

Chairman Bernanke warned that high budget deficits could cause interest rates to rise and derail the economic recovery. The White House estimates that the U.S. budget deficit could reach $5.1 trillion over the next five years. This year, the deficit could set a record of $1.6 trillion.”

My editorial comments:

How could interest rates NOT go up? And, Why NOT stop spending?

The real estate industry will be further impacted – this is a vicious cycle only to be broken by constrained government spending. I think investing in hard hats is a good move because it will be a bumpy ride in 2010. Plan accordingly.