Technology is the driving force behind many of today's real estate transactions. Let’s connect to discuss how working together to go digital can give you an edge when buying or selling your home.
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« What Does Manscaping Have to do with Real Estate The information contained, and the opinions expressed, in this article are not intended to be construed as investment advice. Marshall Malone does not guarantee or warrant the accuracy or completeness of the information or opinions contained herein. Nothing herein should be construed as investment advice. You should always conduct your own research and due diligence and obtain professional advice before making any investment decision. Marshall Malone will not be liable for any loss or damage caused by your reliance on the information or opinions contained herein. Marshall Teaches Manscaping....and what that has to do with Real Estate in Birmingham
A few Secrets about Crestwood in March
Median Home value
Many American businesses have been put on hold as the country deals with the worst pandemic in over one hundred years. As the states are deciding on the best strategy to slowly and safely reopen, the big question is: how long will it take the economy to fully recover? Let’s look at the possibilities. Here are the three types of recoveries that follow most economic slowdowns (the definitions are from the financial glossary at Market Business News):
No one can answer this question with one hundred percent certainty. However, most top financial services firms are calling for a V-shaped recovery. Goldman Sachs, Morgan Stanley, Wells Fargo Securities, and JP Morgan have all recently come out with projections that call for GDP to take a deep dive in the first half of the year but have a strong comeback in the second half. Is there any research on recovery following a pandemic?
There have been two extensive studies done that look at how an economy has recovered from a pandemic in the past. Here are the conclusions they reached: 1. John Burns Consulting: “Historical analysis showed us that pandemics are usually V-shaped (sharp recessions that recover quickly enough to provide little damage to home prices), and some very cutting-edge search engine analysis by our Information Management team showed the current slowdown is playing out similarly thus far.” 2. Harvard Business Review: “It’s worth looking back at history to place the potential impact path of Covid-19 empirically. In fact, V-shapes monopolize the empirical landscape of prior shocks, including epidemics such as SARS, the 1968 H3N2 (“Hong Kong”) flu, 1958 H2N2 (“Asian”) flu, and 1918 Spanish flu.” The research says we should experience a V-shaped recovery. Does everyone agree it will be a ‘V’? No. Some are concerned that, even when businesses are fully operational, the American public may be reluctant to jump right back in. As Market Business News explains: “In a typical V-shaped recovery, there is a huge shift in economic activity after the downturn and the trough. Growing consumer demand and spending drive the massive shift in economic activity.” If consumer demand and spending do not come back as quickly as most expect it will, we may be heading for a U-shaped recovery. In a message last Thursday, Chris Hyzy, Chief Investment Officer for Merrill and Bank of America Private Bank, agrees with other analysts who are expecting a resurgence in the economy later this year: “We’re forecasting real economic growth of 30% for the U.S. in the 4th quarter of this year and 6.1% in 2021.” His projection, however, calls for a U-shaped recovery based on concerns that consumers may not rush back in: “After the steep plunge and bottoming out, a ‘U-shaped’ recovery should begin as consumer confidence slowly returns.” Bottom Line The research indicates the recovery will be V-shaped, and most analysts agree. However, no one knows for sure how quickly Americans will get back to “normal” life. We will have to wait and see as the situation unfolds. « How Technology will help the home buying process The information contained, and the opinions expressed, in this article are not intended to be construed as investment advice. Marshall Malone does not guarantee or warrant the accuracy or completeness of the information or opinions contained herein. Nothing herein should be construed as investment advice. You should always conduct your own research and due diligence and obtain professional advice before making any investment decision. Marshall Malone will not be liable for any loss or damage caused by your reliance on the information or opinions contained herein. Some Highlights:
« Will Surging Unemployment Crush Home Sales The information contained, and the opinions expressed, in this article are not intended to be construed as investment advice. Marshall Malone does not guarantee or warrant the accuracy or completeness of the information or opinions contained herein. Nothing herein should be construed as investment advice. You should always conduct your own research and due diligence and obtain professional advice before making any investment decision. Marshall Malone will not be liable for any loss or damage caused by your reliance on the information or opinions contained herein. Ten million Americans lost their jobs over the last two weeks. The next announced unemployment rate on May 8th is expected to be in the double digits. Because the health crisis brought the economy to a screeching halt, many are feeling a personal financial crisis. James Bullard, President of the Federal Reserve Bank of St. Louis, explained that the government is trying to find ways to assist those who have lost their jobs and the companies which were forced to close (think: your neighborhood restaurant). In a recent interview he said: “This is a planned, organized partial shutdown of the U.S. economy in the second quarter. The overall goal is to keep everyone, households and businesses, whole.” That’s promising, but we’re still uncertain as to when the recently unemployed will be able to return to work. Another concern: how badly will the U.S. economy be damaged if people can’t buy homes? A new concern is whether the high number of unemployed Americans will cause the residential real estate market to crash, putting a greater strain on the economy and leading to even more job losses. The housing industry is a major piece of the overall economy in this country. Chris Herbert, Managing Director of the Joint Center for Housing Studies of Harvard University, in a post titled Responding to the Covid-19 Pandemic, addressed the toll this crisis will have on our nation, explaining: “Housing is a foundational element of every person’s well-being. And with nearly a fifth of US gross domestic product rooted in housing-related expenditures, it is also critical to the well-being of our broader economy.” How has the unemployment rate affected home sales in the past? It’s logical to think there would be a direct correlation between the unemployment rate and home sales: as the unemployment rate went up, home sales would go down, and when the unemployment rate went down, home sales would go up. However, research reviewing the last thirty years doesn’t show that direct relationship, as noted in the graph below. The blue and grey bars represent home sales, while the yellow line is the unemployment rate. Take a look at numbers 1 through 4:
Isn’t this time different? Yes. There is no doubt the country hasn’t seen job losses this quickly in almost one hundred years. How bad could it get? Goldman Sachs projects the unemployment rate to be 15% in the third quarter of 2020, flattening to single digits by the fourth quarter of this year, and then just over 6% percent by the fourth quarter of 2021. Not ideal for the housing industry, but manageable. How does this compare to the other financial crises?Some believe this is going to be reminiscent of The Great Depression. From the standpoint of unemployment rates alone (the only thing this article addresses), it does not compare. Here are the unemployment rates during the Great Depression, the Great Recession, and the projected rates moving forward: Bottom Line
We’ve given you the facts as we know them. The housing market will have challenges this year. However, with the help being given to those who have lost their jobs and the fact that we’re looking at a quick recovery for the economy after we address the health problem, the housing industry should be fine in the long term. Stay safe. The information contained, and the opinions expressed, in this article are not intended to be construed as investment advice. Marshall Malone does not guarantee or warrant the accuracy or completeness of the information or opinions contained herein. Nothing herein should be construed as investment advice. You should always conduct your own research and due diligence and obtain professional advice before making any investment decision. Marshall Malone will not be liable for any loss or damage caused by your reliance on the information or opinions contained herein. |
Marshall Is......a third generation realtor. His brothers, parents, and grandfather were all realtors in Alabama. He has spent much of his life as an entrepreneur, having started 4 businesses, and he considers hospitality a key element in everything he does. Marshall will go the extra mile for you. Archives
October 2020
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