tag:blogger.com,1999:blog-6616959642391988608.post6606058514482161923..comments2024-03-28T00:18:25.641-07:00Comments on Calafia Beach Pundit: Residential construction still in a bottoming formationScott Grannishttp://www.blogger.com/profile/14028519647946868684noreply@blogger.comBlogger14125tag:blogger.com,1999:blog-6616959642391988608.post-57138243302107505062010-09-22T03:52:01.701-07:002010-09-22T03:52:01.701-07:00We should see housing starts growing rapidly off o...We should see housing starts growing rapidly off of an extremely low base. This means a very small boost to the economy.<br /><br />Housing is an segmented market. There are places where supply and demand are in balance and as the economy creeps forward more and more regions will see a resumption of normal activity. The unemployed construction workers and the firms that would employ them are not Charleshttps://www.blogger.com/profile/00607057013050715435noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-12453241481745668092010-09-22T03:21:00.190-07:002010-09-22T03:21:00.190-07:00Peak overbuilding was January 2006
at 1.823 millio...Peak overbuilding was January 2006<br />at 1.823 million when equilibrium<br />( .90% times nonfarm payrolls) was<br />1.215 million.broderohttps://www.blogger.com/profile/12296214283216386700noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-87493289961989984022010-09-22T02:58:11.537-07:002010-09-22T02:58:11.537-07:00"If nonfarm payrolls are stagnant, shouldn..."If nonfarm payrolls are stagnant, shouldn't housing starts be stagnant? Payrolls in 2010 are not materially different than payrolls in 2000. Shouldn't your model correlate the growth rate?"<br /><br /> I wish i could show you a chart but here goes...Equilibrium is .90%<br />of nonfarm payrolls...Non farm payrolls is 130,311..so .90% is 1.172 million today we are .430.<br />An broderohttps://www.blogger.com/profile/12296214283216386700noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-51368357908450297442010-09-21T16:50:51.627-07:002010-09-21T16:50:51.627-07:00the second quarter number was too high
I'm no...<i>the second quarter number was too high</i><br /><br />I'm not following you. Q2 is Q2, Q3 is Q3. Too high, too low. I don't get it.<br /><br />Now on to your model. If nonfarm payrolls are stagnant, shouldn't housing starts be stagnant? Payrolls in 2010 are not materially different than payrolls in 2000. Shouldn't your model correlate the <b>growth rate</b>?<br /><br />Housing marmicohttps://www.blogger.com/profile/08277071086056574486noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-49120267040972760192010-09-21T11:46:25.846-07:002010-09-21T11:46:25.846-07:00If you believe Scott's post that the worst is ...If you believe Scott's post that the worst is behind us in housing, and if you believe Bob Toll's view that pent up demand is increasing, and you believe the recovery in housing is a matter of timing and degree, one way to profit from being right about those things is to buy the bank stocks. I think they will move upward before we see positive housing numbers (they will lead them). CreditJohnhttps://www.blogger.com/profile/11652253509768573561noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-21196631775842596122010-09-21T10:46:15.009-07:002010-09-21T10:46:15.009-07:00BTW, Zuckerman has op-ed in today's WSJ re hou...BTW, Zuckerman has op-ed in today's WSJ re housing.Benjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-84043060386696070362010-09-21T10:27:47.043-07:002010-09-21T10:27:47.043-07:00Marmico the 3rd qtr Resi number
will be negative b...Marmico the 3rd qtr Resi number<br />will be negative because the second<br />quarter number was too high....<br />Residential investment is now only 2.5% of GDP.....damage has already been done...broderohttps://www.blogger.com/profile/12296214283216386700noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-35437519479314223332010-09-21T10:21:41.836-07:002010-09-21T10:21:41.836-07:00Scott The Stopped Clock Grannis. The system is fix...Scott <a href="http://scottgrannis.blogspot.com/2008/09/housing-construction-cant-shrink-much.html" rel="nofollow">The Stopped Clock</a> Grannis. The system is fixed, huh.<br /><br />The starts data reverses itself next month when the "out-sized" multi-family starts this month falls back to trend next month. Look at <a href="http://www.census.gov/const/newresconst_201008.pdf" rel="marmicohttps://www.blogger.com/profile/08277071086056574486noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-24692965247660699532010-09-21T10:18:39.651-07:002010-09-21T10:18:39.651-07:00Redundant don't you think??Redundant don't you think??broderohttps://www.blogger.com/profile/12296214283216386700noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-263765310361699822010-09-21T10:17:34.937-07:002010-09-21T10:17:34.937-07:00The single unit housing starts to
nonfarm payrolls...The single unit housing starts to<br />nonfarm payrolls ratio has averaged<br />around .90% for the last 20 years...using .90% as an equilibrium point single unit housing starts should be 1.172 million but we are .430...we have<br />been underneath the equilibrium point for well over 3 years. By<br />the 1st quarter of 2011 we will have wiped out the overbuilding starting from the late 1990'broderohttps://www.blogger.com/profile/12296214283216386700noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-85365551982896218442010-09-21T10:17:13.757-07:002010-09-21T10:17:13.757-07:00The single unit housing starts to
nonfarm payrolls...The single unit housing starts to<br />nonfarm payrolls ratio has averaged<br />around .90% for the last 20 years...using .90% as an equilibrium point single unit housing starts should be 1.172 million but we are .430...we have<br />been underneath the equilibrium point for well over 3 years. By<br />the 1st quarter of 2011 we will have wiped out the overbuilding starting from the late 1990'broderohttps://www.blogger.com/profile/12296214283216386700noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-58724337112629476682010-09-21T09:40:07.070-07:002010-09-21T09:40:07.070-07:00I don't necessarily disagree with you. But get...I don't necessarily disagree with you. But getting back to "normal" in six years would still equate to some pretty impressive growth rates. I think the change on the margin (e.g., growth rates) is more significant than the level of starts.Scott Grannishttps://www.blogger.com/profile/14028519647946868684noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-40276465601559284822010-09-21T09:33:52.472-07:002010-09-21T09:33:52.472-07:00Sorry Scott, 6-9 Months is WAAAAAYYY too optimisti...Sorry Scott, 6-9 Months is WAAAAAYYY too optimistic. Many areas have current delinquency rates in excess of 25%, plus there's a lot of people that will not be qualified to purchase a home for years to come. <br /><br />It's going to be more like 6 years before the previous "normal range".<br /><br />I wish it were different, I really do.Sisyphushttps://www.blogger.com/profile/16498785567024020255noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-86447990388622155892010-09-21T09:13:36.311-07:002010-09-21T09:13:36.311-07:00Both commercial and residential real estate are in...Both commercial and residential real estate are in a depression. I am surprised this has not gotten more ink. <br />With core inflation trending towards negative territory, the Fed has a wide-open playing field to be far more stimulative.Benjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.com